Debbie Fisher has the Floor
PCHTF Board Members talk about Affordable Housing
Falling back on sage advice to speak to what you know, the sharing of my board member perspective has the overlay of experience as a developer and property manager. One thing I know for sure, a lot has changed over the past 30 years and the need for communities to have a point organization, such as PCHTF, to provide vision, strategic guidance and funding is greater than ever.
Our business, Newbury Management Company, develops and manages multi-family properties, more than half of which are classified as affordable to families or seniors whose income is at or below 60% of the median income. Some of our tenant families pay only 30% of their income and the government subsidizes the balance of their monthly rent.
While subsidies do continue, without a doubt, full rent subsidized projects are not as prevalent as 30 years ago. Housing Assistance Payments Contracts with the government began expiring in the mid to late 1990’s. It was a time when many projects converted to conventional and market rentals, leaving a gap in a community’s ability to provide truly “low-income” housing opportunities. As those affordable housing options disappeared, “preservation” became the buzzword in the affordable housing industry. However, preserving 30-40 year old affordable housing stock is harder and more costly task than creating a new building. Bringing old buildings up to current code with new wiring, energy efficiency measures, ADA compliance requirements (ka-ching$!) can be incredibly expensive.
Developers also compete for a limited amount of funding and oftentimes come up short in balancing the sources and uses. PCHTF offers a source of “soft gap financing” that can help fill the holes in a developer’s financial feasibility without creating additional layers of difficulty or requiring a higher level of must-pay debt. That sort of gap-filler financing is not so easy to find these days. So the importance of this role in getting a project renovated and providing the “preserved”, or new, affordable housing is very evident on the front end of a deal. At completion, when the property is operating, having the Trust Fund financing in place allows the developer to have less “hard” debt to service with the very modest revenue generated by an affordable housing property. This makes it easier on the management side to cover the operating costs and keep the budget balanced. The bottom line is that through their participation in affordable housing development, PCHTF provides support that can take a developer’s vision of creating or preserving affordable housing and bridge a gap that moves that dream into a reality of serving many needy families. That support and stewardship is one of many reasons I invest my time serving as a PCHTF Board Member.