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The Boston Globe

 

Mayor Must Reconsider 'Affordable'

January 02, 2006

By Howard Husock

HE IS KNOWN as the urban mechanic -- with the implication that Tom Menino merely tinkers at the edges of policy and devotes his efforts more to keeping the streets clean and the parks green. But he might just as well be known as the affordable housing mayor, so aggressive has he been in using an array of funding sources to add thousands of subsidized housing units to the city's housing stock. Since 1999 alone, the Menino administration has added more than 4,000 such dwellings to the city's stock -- 65 percent targeted to households earning less than 60 percent of median income, 25 percent to the very poor. And the city has designed its effort in such a way that these units will be ''permanently affordable" -- buffered from the price increases of the open market. Even before this recent push, Boston ranked second among all US cities in terms of subsidized units per capita. After the Menino effort, 20 percent of all housing units in the city are government-subsidized.

City Hall has made clear its intention to continue on this aggressive path, using the sale of city property and fees from private developers to finance still more new ''affordable" housing. As he faces his next four years, however, the mayor might want to ask himself when enough is enough. It is worth his keeping in mind there are costs and risks, as well as benefits, associated with subsidized housing.

Low-income housing is not inexpensive. ''Affordable" units can often cost $250,000 to $350,000 to build, even if their cost to renters or buyers is written down by subsidies such as the federal low income housing tax credit. The question arises as to whether the use of scarce public dollars in this manner is the best way to help the largest number of people. Indeed, Richard Green of George Washington University, has estimated that for each dollar in public funds spent on affordable housing, only 49 cents worth of actual housing is built.

Compare this with the signature Clinton administration program to lift the poor: the earned income tax credit, which directly supplements the income of the working poor. Affordable housing programs reward a lucky few with what amounts to a lottery ticket for a new housing unit; income supplements aid far greater numbers.

Then there is the risk of Boston becoming what I call a frozen city. The city boasts of its efforts to ensure that subsidized units -- both public housing and privately owned units -- stay that way in perpetuity. This sounds like a noble goal but ignores the possibility that subsidized housing might block construction of a higher and better use, one which will generate jobs and property taxes that would benefit far more people. Government is not likely to be able to predict what parcels of land will be valuable for what purposes in the decades to come. Indeed, it is worth questioning whether the land on which the Menino administration built the expensive Mission Main subsidized townhouse project might have been put to better use by the city's contiguous healthcare and medical research industry.

Housing advocates -- and Menino has been honored by the National Low-Income Housing Coalition -- would have us believe that more subsidized housing is always better.

But with 40,000 of its 250,000 total housing units now government-subsidized and reserved for those of lower income, Boston risks creating a system of modern-day poorhouses -- a description which already applies to the public housing system. Our federal public assistance policy today comes with a time limit and work requirement; housing assistance comes with neither, raising the specter of the city facilitating long-term dependency. Indeed, the beneficiaries of housing programs are frequently the same single-parent households that a reformed welfare program has sought to motivate toward upward mobility.

The fact that there are often long waiting lists for new subsidized developments should be discounted; there would be similar long lines if the city began to sell gasoline at 50 cents a gallon. Moreover, subsidized developments are hard to maintain. Indeed, some 754 of the ''new" subsidized units created during the Menino years have been public housing units which had fallen into total disrepair.

So it is that it may well be time for a moratorium on further subsidized housing in Boston. Which does not mean that the mayor, in his new term, should not look for new ways to spur overall housing construction.

Those who seek to build in the city know that the permitting process -- obtaining zoning changes, building permits, and certificates of occupancy -- is lengthy and expensive. The mayor as urban mechanic might consider setting new performance goals for the departments involved and thus making it easier to build. Housing codes, too, might be reviewed to help cut construction costs. Ultimately more housing supply will lower prices across the board, even without more ''affordable" housing.

Original Source: http://www.boston.com/news/globe/editorial_opinion/oped/articles/2006/01/02/mayor_must_reconsider_affordable/?p1=email_to_a_friend

 

 
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