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City Council Meeting April 26

"Affordable Housing" under spotlight
Costs questioned
Marc Knapp who covers City Council

"Affordable housing" was under the spotlight at last night's Council Meeting. It started of with a presentation by the City's Housing and Community Development Department. This was later followed by comments from Don Cameron of the City of Charleston's Housing Authority and questions and comments from Council members George, Fishburne and Shirley relating to the high cost of the City's initiative using the proceeds of a proposed $10 million bond issue.

Presentation by Housing Department
We are not sure why the Department of Housing and Community Development made the presentation. Maybe it was because of the reading relating to the agreement between the City and the Housing Authority to develop a number of properties. We can't say that we learned anything new from the presentation. It covered the need for "affordable housing", the relatively low wages and high real estate costs of the area. It had testimonials from recipients and a host of pictures of projects that had been completed by some of the "affordable housing" providers and the City. It had some breakdown of costs and showed as an example that of 21 Nassau Street which was rehabilitated for $90,400 and sold for $76,000. We don't question these figures but we certainly question as to whether this example is an indication of future levels of costs. Recent projections by the City of development costs for 2 properties on Nunan Street recently sold to Pastors for "affordable housing" will have sales prices of over $120,000. The cost of development, including the cost of the land to the City and the subsidy to be provided by the City, takes the average cost to near $180,000 per unit.

A confusing report
The Housing Department also tabled a Housing Production Status Report. We confess to having problems reading the Department's annual reports. They are often vague, confusing and although many figures are given of housing production and sales, they are often incomplete. The report tabled was no exception. "The report provides a tally of the total number of units produced in the 2004-2005 program year" (to May 31). In the body of the report, it states that 14 of the 81 properties being developed in the Home Initiative program were completed in the program year. Yet we add the figures relating to the completion by providers, and the total comes to 22. In the table of production up to January 12, it shows 19 units completed. So we wonder how reliable are any of these figures?

And how is this for a definitive progress report? It is an extract from the tabled report for the fiscal year "City of Charleston Capital Projects Division - 24 units. Managed in partnership with the Redevelopment and Preservation Commission (RPC) Capital Projects will undertake a focused substantial rehabilitation program in target areas within the Community Development Target area. Rehabilitation will complement other revitalization projects within the City of Charleston. Currently housing staff within the Parks Division are focused on the following - Client recruitment, client marketing and education. The RPC will continue to meet on a monthly basis to review cases and make decisions related to the programs".

Note there is no description of what was done in the fiscal year, only an indication as to what might be done in future. The RPC is the recipient of the major part of funds from HUD generally amounting to over $800,000 a year. And this is the report we get on its activities. Mention might also be made that there have been a number of occasions when there were insufficient members present for the Commission to have a quorum. These meetings were thereby rendered ineffective. (Mayor Riley, it's time to make some new appointments!)

Housing Authority responsible for housing 10% of Charleston families
Mr. Donald Cameron, CEO of the Charleston Housing Authority had some interesting comments on "affordable housing". He said that the Housing Authority, which handles Section 8 and other subsidized housing, was responsible for about 3600 families, roughly 10% of all families living in the City. Yet he said those who qualify for housing provided by the Authority probably would represent 30% of all families. This is obviously a high figure and prompted questions from Council members as to what might the ratio be in other cities. In summarizing the response, it seems that Charleston is very much at the top end of the range, a fact that owes itself to history and the concentration of poor African Americans on the Peninsula

These comments prompted Council member Campbell to suggest the City do more to help raise wages and salaries which in turn prompted Council member George to say that the key was education, without it, there was no hope for raising income levels.

Agreement between City and Housing Authority
Mr. Cameron was at the meeting last night because of the proposed agreement between the Housing Authority and the City. We have referred to this before and the agreement relates to the use of the $10 million proceeds from a proposed bond issue. The issue was approved by voters at a referendum 3 years or so ago. The agreement authorizes the Housing Authority to build up to 64 units on 3 specified sites and binds the City to paying up to $10 million to cover the cost. The units are as follows - 28 units on Daniel Island, 10 units on Romney St (St. Charles Apartments) and 26 units on the William Enston Homes site. All units will be rented and the proceeds of the rents will be used to meet interest payments and amortization of the bonds.

Proposed "affordable housing" was expensive
Council member Fishburne made the observation that "affordable housing" was all well and good. But $10 million for 64 units seemed expensive. This observation was made also by Council members George and Shirley. The cost works out at over $150,000 a unit and as Council member Shirley observed, the private sector can put up units at a cost less than this figure.

We had an earlier discussion with Mr. Cameron about this issue and the explanation is broadly as follows. The William Enston Home development will be expensive. The new units will be almost identical to the existing units on the site. They will be of brick and compliment the existing fabric of the homes. The original units were built in the early 1900's and are very impressive, solid structures. We do not know that cost of each unit but we are sure that it will be well in excess of $150,000 a unit. The Daniel Island apartments are part of a 108 unit development and will be almost identical to the sale- for- profit units that comprise the balance of the development. So again, the cost will be higher than typical "affordable housing" units. However the St. Charles apartments will be relatively cheap and part of a redevelopment.

Real costs would be even higher
The Council members were right to raise the question of the cost. They were unhappy about its high level, but in fact, the average notional cost of the units would be much higher than $150,000. The William Enston site is already owned by the Housing Authority so there was no purchase of land involved. As well, the Housing Authority is creating infrastructure at the Enston site which is not reimbursable. We guess that the land and infrastructure could add a notional $10,000 to the cost of each of the Enston Homes units.

The high costs of "affordable housing" on the Peninsula brought comments from Council members and the Mayor about initiatives in future off the Peninsula, particularly West of the Ashley. Council member Lewis also noted the suitability of the Neck area.

Council unhappy about new ordinance on vested rights
Council also considered an ordinance to amend the City Code relating to Zoning. The City was not happy about this amendment but according to legal opinion, it was virtually forced to making the amendment by newly passed State Law. The amendment relates to vested rights of a property developer. According to Council member George, this change in rights will prove a major headache for the City and its regulatory bodies.

Under the proposed ordinance, a developer will be "vested" for two years with an option for 5 one year renewals. As an example of what this means, assume that a developer gets preliminary approval from the appropriate body to construct a 4 story building.This approval willl now be locked in for 2 years and cannot be changed by the granting body. Theoretically, the developer could sit on his preliminary approval for a total of 7 years by using his extension options. Towards the end of the 7 year period, he could move forward to completion or choose to let the preliminary approval lapse.

Re-appointments to City Zoning Boards, and Planning Commission
And finally, the Council approved the reappointment of a number of members of the Board of Zoning Appeals, and Planning Commission. Edward Pritchard, Vertelle Middleton, Nell Postell and Sheila Wertimer were re-appointed to the Board of Zoning Appeals- Site design. Mr. Leonard Krawcheck was reappointed to the Board of Zoning Appeals -Zoning. Of the 9 members of the Planning Commission, 6 were re-appointed last night. They were Frank McCann, Charles Karesh, Barbara Ellison, Susan Legare, Sunday Lempsis and Keith Waring. All members were appointed for 3 year terms

We note that Mr. Krawcheck has been a member of the Board of Zoning Appeals for more than two decades. We don't question Mr Krawcheck's ability but we ask why there is no infusion of new blood into the Zoning Board. Most of the members of the Zoning Appeals - Zoning have served for many years. What continuity will it have if many retire at the same time? It takes time to build experience and it comes better with tutelage from the more senior members.

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