This bill would create a new tool for DC to expand its dedicated affordable housing stock

A new bill introduced by DC At-Large Councilmember Robert White would allow DC to pay landlords to turn existing units into dedicated affordable housing.

The bill, dubbed the Generating Affordability in Neighborhoods (GAIN) Act, would create a program through which landlords could apply for funding. In return, those landlords would establish affordability covenants for some of their units, setting them aside for households making less than 50% of the median family income (MFI), and keeping the rents low.

The bill, White said in an interview, offers a “market based approach that will allow us to create affordable housing more quickly and less expensively in more areas of the city.” White’s team isn’t aware of other similar programs outside the District.

White’s bill, which lists Ward 1 Councilmember Brianne Nadeau as a cosponsor, was introduced last week. It would have DC officials issue requests for proposals while proactively recruiting landlords to the program. The RFP would include: targets for each ward for the number of units to be available to households under 30% MFI and 50% MFI; the minimum duration of affordability; and the maximum rents for each MFI bracket.

Officials would then choose landlords to award subsidies. Those landlords would place covenants on the land requiring the designated units be dedicated affordable housing for the determined amount of time.

Affordable housing covenants are used in other programs such as DC’s Inclusionary Zoning program to lock in dedicated affordability long term. They typically have both rent limits and income requirements for residents.

Residents living in the affordable units under White’s bill would have to certify their income each year. The bill lays out a process for residents who start earning more money to begin paying market rent; meanwhile, the landlord would put an affordable covenant on another unit to replace it. Landlords would be required to be in “substantial compliance” with housing regulations according to the bill.

There’s no cost estimate yet for the program, but White expects cost estimates to be “very compelling.” He said they are working with the DC Policy Center to estimate how much funding the program would need and how far dollars would go per unit on average. The idea is that it would be cheaper (and faster) than new construction.

In an email sent through staff, White laid out an example of how the program could work:

“[…]according to the rent schedule published by DHCD for Affordable Dwelling Units, the maximum rent for a two bedroom apartment affordable to 50% of MFI is $1,360. I found a unit in Glover Park renting for $1,800. To put a 40 year covenant on this unit, it will cost the District a little more than $210,000. This is a one-time investment, and we’ve locked in affordability for a family of three for 40 years.

White said they expect getting that upfront payment all at once to be the major draw for landlords.

One major benefit to DC, White said, is that it could increase its affordable housing stock without being on the hook for maintenance and repairs down the line — a compelling incentive given the problems DC’s Housing Authority has faced in fixing its deteriorating housing stock.

Another potential benefit White pointed to: the program could allow DC to get more affordable housing into historically exclusive areas like Ward 3, where the District has long fallen short of its housing construction goals due to, among other reasons, restrictive land use. By paying for covenants instead of building anew, DC could create dedicated affordable housing in places where right now, it’s just not getting built.

“We need more housing that real people can afford in this city and we need it as quickly as possible,” White said.