Posted: August 23rd, 2021
On Wednesday, February 19, Houston City Council voted to approve resolutions giving the city’s support to 23 proposed Low Income Housing Tax Credit developments scattered throughout Houston. The Low Income Housing Tax Credit program allows apartment operators to take a credit against their income tax in exchange for agreeing to lease apartments at affordable rents to residents with incomes below a certain percentage of the average income for the area.
The resolution passed to support all 23 proposals, but not without opposition to various projects by various council members – mostly for the proposed communities in their districts.
Houston’s support for affordable housing is not new. Mayor Sylvester Turner has worked hard to ramp up the city’s efforts to provide more housing options for more low-income Houstonians. What is new, though, is the holistic approach of mapping out and passing 20 tax credit support resolutions at one time, with the properties very meticulously dispersed throughout the entire city. The city’s list of supported projects include some in high-dollar neighborhoods that have not been chosen for affordable housing in the past. Two of the properties are in the Heights and one is on Post Oak Boulevard inside Loop 610.
Why is the city looking at these locations, and why now?
A few years ago, Houston began planning a 233-unit affordable housing community on Fountain View, in the Galleria area. At an estimated $53 million, the property was far more expensive that most similar projects. On the one hand, the project would have provided 233 units in a “high opportunity area,” zoned for good schools. On the other hand, that same sum of money could have provided many more badly-needed housing units in areas with lower land costs. Mayor Turner opposed the Fountain View property in favor of other options that would provide housing for more people.
The U.S. Department of Housing and Urban Development immediately launched a five-month investigation, which resulted in a scathing 14-page letter accusing the city of “blocking and deterring affordable housing proposals in integrated neighborhoods.”
“The city’s refusal to issue a resolution of no objection for Fountain View was motivated either in whole or in part by the race, color, or national origin of the likely tenants,” Garry Sweeney, director of HUD’s Fort Worth’s regional office of fair housing and equal opportunity, wrote. “More generally, the department finds that the city’s procedures for approving Low-Income Housing Tax Credit applications are influenced by racially motivated opposition to affordable housing and perpetuate segregation.”
Mayor Turner, an African-American with strong roots among low-income Houstonians, saw the issue very differently. To him, focusing solely on housing in “high opportunity areas” was basically telling low-income Houstonians they should give up on their neighborhoods, and that working to improve the areas where they live would be a waste of money. If they want a better life, by that logic, they should give up on the neighborhoods they know and move somewhere else. Turner, as evidenced by his commitment to the Complete Communities program, is a supporter of investing in low-income communities and turning them into the high-opportunity areas in which HUD wants affordable housing.
Reasonable people can disagree about the best approach to affordable housing, but the most important point may be simply that Houston needs more affordable housing everywhere. With a population of over 2 million, Houston’s roughly 78,000 subsidized units are not nearly enough. As the cost of housing continues to rise faster than wages for unskilled and low-skilled workers, the gap between supply and demand is going to continue to grow.
Meanwhile, the 20 Houston properties supported by Houston City Council for tax credits will now have to compete for those credits with properties all over the state. Out of the 20 supported by the City of Houston, only about 10 are likely to be awarded credits and proceed to construction.
For your assignment this week, write a 2 – 5 page essay about the city’s decision to support these projects. Is this a good idea? Do you think there are better ways to proceed, and, if so, what suggestions would you have if you were a member of the Houston City Council?
Submit in Word. Cite your sources.
Here’s the Houston City Council agenda from that week (Look for Item 41, starting on page 8): http://www.houstontx.gov/citysec/agenda/2020/Feb1820.pdf (Links to an external site.)
If you go to the “online agenda,” for February 18, scroll down and click on Item 41, you can see the “backup” information given to council members: https://houston.novusagenda.com/agendapublic/ (Links to an external site.)
The Houston Chronicle wrote about the leadup to this: https://www.houstonchronicle.com/business/real-estate/article/Two-dozen-mixed-income-projects-seek-tax-credits-15047375.php (Links to an external site.)
…then the upcoming vote: https://www.houstonchronicle.com/news/houston-texas/houston/article/affordable-homes-tax-community-change-income-low-15065977.php# (Links to an external site.)
…and the outcome: https://www.houstonchronicle.com/news/houston-texas/houston/article/Houston-council-support-tax-credits-housing-afford-15068063.php (Links to an external site.)
Here’s a little background on the Low Income Housing Tax Credit program: https://www.nhlp.org/resource-center/low-income-housing-tax-credits/
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