June 9, 2018 — On June 4, Florence City Council approved a partnership with the Neighborhood Economic Development Corporation (NEDCO) and the Willamette Neighborhood Housing Services (WNHS) to seek grant funding for an affordable housing development in Florence. Part of the agreement involves a real property transfer of 1424 Airport Road from the city to NEDCO if the grant funding is approved within the designated timeframe.
“I don’t have to tell the city council that affordable housing is a high priority item,” said City Recorder Kelli Weese. “There is vast community support in the need for housing solutions, and we feel this is an innovative solution with the potential to be replicable throughout Florence.”
NEDCO is a private nonprofit that develops housing, helps with homeownership and focuses on community economic development. It is based in Springfield and provides services in Lane, Marion and Clackamas Counties. It recently announced plans to merge with WNHS, a similar nonprofit that develops affordable renter- and owner-occupied housing in Benton, Linn and Lincoln Counties.
Weese presented on the “Airport Road Affordable Housing Development” proposal and talked about the history of the project.
According to Weese, the city began working with NEDCO on a grant proposal that was due in January. While Florence did not win that grant funding, much of the work for the project will apply to a new Oregon Housing & Community Services Local Innovation Fast Track (LIFT) grant for affordable housing.
“Never to be deterred, we are looking at partnering with NEDCO again for another potential grant alternative,” Weese said.
NEDCO/WNHS will apply to the LIFT grant by the deadline of June 25.
According to the staff report, LIFT grants are specific to programs that develop affordable homeownership units for low- to mid-income families. Half of the allocated funding has a ‘soft’ set aside for rural communities under 15,000 population.
Through LIFT, developers can apply for up to $75,000 per unit to pay for development costs associated with land acquisition, infrastructure development, system development charges, and other costs not associated with the housing units themselves. In return, the homes must be maintained as affordable for at least 40 years and sold and re-sold to homeowners below 80 percent of the area median income (AMI).
“During our earlier grant preparation, city staff and NEDCO representatives reviewed a lot of potential affordable housing locations,” Weese said.
Weese continued, “We eventually chose the old senior center site on Airport Road for the grant proposal because of its central, in town location; availability of utility infrastructure; its proximity to family services like Miller Park, the Boys and Girls Club and the Siuslaw schools; and it is zoned multi-family, is owned by the COF, has a history of intended use for affordable housing … and is kind of a ‘Goldilocks’ site in terms of lot size — it is not too big, not too small and really fits the model of this sort of development.”
The lot size is 1.73 acres, or 73,359 square feet, and is zoned multi-family residential. It is also the current site of the Florence First Harvest Community Garden, but Weese indicated the city is willing to help the garden find a new site.
Representatives from NEDCO and WNHS presented on the organizations’ histories and plans moving forward.
NEDCO Executive Director Emily Reiman explained that once the merger is complete, she will serve as executive director and interim WNHS Executive Director Brigetta Olson will be the deputy director. The new name for the merged nonprofits has yet to be announced.
“We will be, for all intents and purposes, a bigger and better version of what both of us are as community development corporations,” Reiman said.
As organizations that develop housing opportunities and teach a variety of classes on homeownership and fiscal planning, NEDCO and WNHS are looking forward to applying successful affordable housing models to the Florence area.
“Homeownership is a really key method by which working class families have been able to better their financial position over time,” Reiman said. “This is part of America’s history. We know that homeownership is a dream that families are willing to make fairly profound changes in their finances in order to attain that dream.”
She said homeownership has a host of social benefits — including healthier residents, children who do better in school and ability to reinvest in the community — and is the single best way for lower income families to gain assets over time.
“Homeowners are more likely to invest in their community in ways like being engaged in volunteerism, being members of civic associations and running for elected offices because they are permanent and want to be an invested member of that community,” Reiman said.
However, there is a gap between the AMI of working-class families and the affordability of available housing.
According to Reiman, a working-class couple was able to buy their first house in the 1960s for the median cost of what that couple made in a year.
“Since the 1980s, that gap has just skyrocketed,” she said. “Now, we’re looking at home prices that are between five and six times what a median family makes in a year. … Homeownership is becoming progressively farther and farther out of reach for your average working-class or moderate-income family.
“That’s the crux of the problem that we’re trying to solve with the proposal tonight as one piece of it.”
The two organizations utilize several methods to build homes, such as the community land trust model, which legally separates the land from the structures and while a nonprofit holds the land in trust. The individual homes are then sold to low- or moderate-income families.
Olson said, “One way to keep housing affordable is by creating cottage clusters of homes which range in size from 500 to 1,200 square feet, which allows families to grow in workforce housing. These homes are arranged around a common greenspace so it creates a community feel where you know and interact with your neighbors.”
At the Airport Road site, 12 units will be built primarily with working-class families in mind.
“We’re looking at a mix of one, two and three-bedroom units,” Reiman said. “And we are very specific that we do not build tiny houses. Tiny homes are a different industry and they serve a great purpose, but it’s not what we do.”
She added that the typical starter home in the 1950s would have been a similar size.
In addition, there would be plenty of parking in a shared parking lot, as well as a designated storage unit for each house. Shared spaces would include yards, the central greenspace and a pavilion.
Current designs and layouts can be seen in the items distributed at the June 4 council meeting at ci.florence.or.us.
“We really feel like these are livable units that make use of space,” Reiman said. “We’ve been working to design spaces that are efficient to build so there is no material or labor wasted, and are constructed out of durable, high-quality materials.”
NEDCO and WNHS have a plan for outreach to prospective homeowners interested in one of the 12 units, as well as local contractors who may be interested in submitting a proposal to build the units.
“We want to gather some potential homeowners together to run this project by them, see what the feedback is and if this sounds like a community they want to be a part of, as well as see if the houses fit their needs,” Reiman said. “We plan to do a lot of outreach here in the next weeks and throughout the summer to hear from the community what the demand is.”
NEDCO and WNHS will also seek requests for quotations by contractors familiar with working with nonprofits and building multiple units at once.
After some discussion with the council, Councilor Joshua Greene suggested that local contractors could get together to submit a proposal.
“It would be our preference to work with a local contractor,” Reiman said. She added that even if they use contractors from other areas that they have worked with in the past, “Our hope would be that they would be able to use local subcontractors and labor.”
The important part is to create durable and long-lasting units that can retain value for the homeowner over time.
The nonprofits would also like to aim for a quick construction timeline, with homeowners moving in to the completed units in late 2019 or early 2020.
“The timing of this would be at least a year before the houses are actually ready to sell,” Reiman said. “If there are families who income qualify and are interested, but maybe need a little help on their credit or need some time to save, we have time to match them to those services before the houses are built.”
If NEDCO and WNHS were to get the LIFT grant, they would need to have site control of the Airport Road property.
Weese said the city’s buy in could be through the transfer of the property. This could help keep the grant application competitive and show the city’s support of the project.
“How the city could partner is essentially with the land, which is owned by the City of Florence, and is valued at $238,371, according to the 2017 Lane County tax rolls,” she said.
The staff report clarifies that “Site control can be proven with a purchase agreement that is contingent only on the award of LIFT funds – so that the state has assurances that the project can move forward if/when funds are awarded.”
Florence City Council approved the application for the grant and encouraged city staff to proceed with a public hearing for approval of the sales agreement at the June 18 council meeting.
“We just completed a Housing Needs Analysis that shows Florence has a pent-up housing demand of more than 500 units,” Weese said. “Although 12 (new homes) isn’t a lot, it is something to help with that.”
During the public comment period, area resident Brenda Gilmer said she was in support of the project.
“With the city’s decision, you are contributing to the cause of affordable housing, which we all know is necessary to for a healthy community,” she said. “You’ve capped the potential benefit of that property for the future of affordable housing and current and future residents.”
Florence Mayor Joe Henry agreed.
“This is a great step,” he said. “We’ve been working really hard on housing for several years, and we’re making some progress, but not much in the affordable housing range. We hope this can be a model maybe to doing more with (NEDCO/WNHS) and a model that other people can follow.”
People interested in the project are invited to take a short survey at www.surveymonkey.com/r/FlorenceCLT to help gauge community support. In addition, local contractors are encouraged to turn in a request for quotation.