ISU Issues its Report
New Study on Local Housing Trust Funds
AMES, Iowa -- Iowa's State Housing Trust Fund is responding well to the demand for affordable housing in the state, according to an Iowa State University study. However, during the eight years of the program's existence, roughly 70,000 more Iowans tumbled into poverty, creating an affordable housing need that is unmet - and largely unknown.
The Iowa Finance Authority commissioned the ISU College of Design's Department of Community and Regional Planning to conduct the study, which provides an overview and analysis of the state's Local Housing Trust Fund Program (LHTF). The goal of the study was to better understand how the diverse, decentralized LHTFs function and identify their impact on Iowa's housing-burdened population (defined as those who spend more than 30 percent of their gross household income on housing.)
"We found that Iowa's local housing trust funds are hugely beneficial," said Carlton Basmajian, assistant professor of community and regional planning and the study's lead researcher. "Although their total impact is difficult to quantify, their effect goes far beyond affordable housing. They impact local economic development, neighborhood revitalization and the overall reduction of poverty in the state.
"If we want Iowa to remain a good place to live and have a viable, growing economy, we need affordable housing for the workforce," he said.
In 2003, the Iowa Legislature created the State Housing Trust Fund to provide financial assistance for housing projects related to developing and preserving affordable housing for low-income households. Iowa's 24 LHTFs receive about $3 million annually from the State Housing Trust Fund, and can raise funds through private donations and grants. They serve 81 counties and three cities, targeting households at or below 80 percent of Iowa's Median Household Income ($40,338 in 2009).
About the study
The community and regional planning researchers who worked on the study with Basmajian are Doug Johnston, professor and chair; Francis Owusu, associate professor; and Amy Logan, research associate. They presented findings to LHTF administrators and others at a meeting at Iowa State in September. The full report has been submitted to the Iowa Finance Authority.
They also will present a paper based on the research, "Harnessing the Benefits of State Housing Trust Funds: Understanding the Role of Local Administrators in Meeting Affordable Housing Needs in Iowa," at the Association of Collegiate Schools of Planning's annual conference, Oct. 13-16, in Salt Lake City.
During the yearlong study, the researchers gathered information in three phases. First, they analyzed existing socioeconomic and demographic data to understand trends in housing needs and availability throughout the state. Next, they reviewed the plans and bylaws of Iowa's 24 independently administered LHTFs to obtain basic background. Finally, they conducted in-depth interviews with LTHF administrators and/or board members to solicit information and perceptions about fund allocation, decision making and operational issues.
The researchers identified the LHTFs' major activities in Iowa as acquisition and rehabilitation, owner-occupied rehabilitation and repair, homeownership assistance, rent assistance, new construction and homelessness prevention.
Instead of mandating statewide programs, the legislation that set up the LHTFs allowed each one to identify area needs and devise programs to meet those needs. As a result, Basmajian noted, each LHTF has "considerable leeway" in the activities it undertakes.
"Each agency differs in terms of staffing capacity, funding and administration. We wanted to drill down into the decision making," Basmajian said. "We wanted to see how these differences influenced the kinds of housing activities undertaken."
"Iowa's program is more flexible and less structured than in many states -- maybe that's why it is working so well," he said.
Their analysis revealed that the state has experienced a considerable shift in the population's location and demographics.
"Iowa has seen significant population churning -- a serious decline in rural areas and consolidation in urban areas. And poverty has increased, especially since 2001," Basmajian said.
And that means rising demand for affordable housing. Basmajian said the researchers sought to understand the relationship between poverty and housing demand.
"But we found the geography of need was a lot trickier than initially hypothesized," he said. "There's need and there's demand. Need is the iceberg and demand is the tip--the visible need. A lot of folks who need housing never come onto the radar. As great as trust funds are, they have limited money and don't find out about all the cases.
"The other twist is that because of Iowa's significant rural population, the need is even less visible. It's not like in an urban area where people in need are caught up in the web of assistance and know where to find housing resources," he said.
"From our perspective, the big question is the problem of unmet need. There's a big need out there we don't hear about. And the depth of that need remains invisible," Basmajian added.
"Only a tiny amount of money is allocated and affordable housing is a huge problem -- much bigger than I think most people realize," he said. "The local housing trust funds are doing very critical work and they need a lot more money than they have."
The report recommends the LHTFs further leverage their state funding by increasing their grants and donations.
"Without question, the trust funds' impact has been positive. Without this program, many of Iowa's neediest families would likely be without adequate housing," Basmajian said.
Basmajian noted that there is very little research or discussion within the planning profession about housing trust funds in small towns and rural areas.
original link: http://www.news.iastate.edu/news/2011/oct/Basmajian