Local groups offer approaches to greater housing affordability

Nov. 30—CHEYENNE — Local organizations seem determined to continue the conversation about housing affordability, following a recent report that said Cheyenne is in great need of housing of all kinds, but especially for lower- and middle-income people.

Habitat for Humanity of Laramie County and My Front Door, nonprofits that help families in need become homeowners, hosted three public presentations Tuesday in which speakers outlined potential ways to lessen this need. The four possible solutions they outlined were establishing housing trust funds, land banks and community land trusts, and making zoning changes.

These were all ideas recommended by the city's Affordable Housing Task Force in a report unveiled in October.

A study commissioned by the task force, and conducted by U.S. Air Force Academy cadets and their advisors, showed that while the city's population is growing, the number of units affordable for low- and middle-income individuals and families is shrinking. In addition, at least a few hundred workers are expected to move to the city — though temporarily — in connection with upgrades to nuclear missile systems at F.E. Warren Air Force Base.

"We're not covering every solution" to increasing housing affordability, said Dan Dorsch, special projects coordinator for Habitat for Humanity of Laramie County. "The reason we're focusing on these is because we feel these are the solutions that our state and our communities can act upon now to help with the housing crisis."

Dorsch also stressed the difference between "housing affordability" and "affordable housing." Housing affordability "includes the entire housing continuum, from zero all the way up to 100% of AMI, or Area Median Income," Dorsch said. The U.S. Department of Housing and Urban Development considers housing "affordable" if a household spends 30% of monthly income or less on housing, including utilities.

Affordable housing, on the other hand, "fits under the overarching housing affordability and is defined by HUD as housing serving those with AMI of 0% to 80%," and is "often misinterpreted as only subsidized or supported through government programs such as Section 8," according to the task force's report.

"This contributes to "'NIMBY-ism' (not in my backyard) that can hamper housing solutions."

Housing trust funds

Housing trust funds receive consistent public funding and are established to help fund the development and rehabilitation of homes that are affordable to residents.

A national housing trust fund provides $3.2 million each year to Wyoming. That federal funding "is spent, and we're still in a lack of housing and affordable housing, so it's clearly not enough, and we need other options," Dorsch said.

But a state-level housing trust fund could provide "more flexibility and more accessibility for funding on a local level," he said, because federal money often comes with an amount of red tape unmanageable for small nonprofit developers, like Habitat and My Front Door.

A proposal for a statewide housing trust fund died in the Wyoming Legislature's Joint Corporations, Elections and Political Subdivisions Committee earlier this year, but Rep. Dan Zwonitzer, R-Cheyenne, who co-chairs the committee, recently told WyoFile that it would likely be sponsored in the 2023 general session by individual legislators, "probably" including himself.

Cities, counties or other regional designations can also have housing trust funds, creating the potential for even greater local control over how money is spent. Cheyenne's Affordable Housing Task Force has recommended that the city establish such a trust fund as a way to manage funding that comes through an eventual statewide housing trust fund.

Land banks

Land banks, public entities that are usually 501©3 organizations, are "a mechanism to handle properties that are (typically) vacant, abandoned or distressed," said Brenda Birkle, executive director of My Front Door. Birkle also led the Affordable Housing Task Force.

Usually blighted or facing similar issues, "those properties have been rejected by the market. For-profit industry can't make them math out," she said.

That's where a land bank steps in. It acquires that property and takes on the liability, doing the "heavy lifting" in a partnership with a municipality, which would help the land bank do things like clear the title or tax liens, Birkle said.

Then, the land bank has the option to either "develop that property themselves for low- to moderate-income housing, offer it to another nonprofit agency like Habitat to develop for low- and moderate-income housing, or sell it to a for-profit developer with a conditional use of low- to moderate-income housing," Birkle said.

The Legislature's Joint Corporations, Elections and Political Subdivisions Committee has asked for a bill to be drafted based on Nebraska's land banking model, Birkle said.

Community land trust

Cheyenne currently has a community land trust. Birkle described it as "a stewardship approach to homeownership" that creates affordable housing and maintains it "in perpetuity."

"Under a 99-year lease, the owner of a community land trust model owns everything above grade and all the improvements, while an organization like (My Front Door) and others own the land. When the owner goes to sell that property, whatever it appraises for when they bought it and whatever it appraises for when they sell it, they get 25% of that difference," Birkle explained. "With first right of refusal, the community land trust sells it to the next income-qualified buyer below market, forever — with a 99-year lease.

"The benefit about having a land lease is that they don't have to pay for the dirt underneath the home, but by renting it for $50 a month, they get to use the value of that land toward their private mortgage insurance, or PMI, which brings it down even more into the affordability ratio," she continued.

This approach "insulates buyers, to a degree," Birkle said. Homes under community land trusts are deeded to the homeowner, while the land is deeded to the organization.

Zoning changes

Something else Cheyenne has already begun doing is making zoning changes that allow for more housing, such as increasing density (allowing more units on a lot), or reducing requirements for open space and landscape setbacks. The city could also increase the maximum allowed height for buildings.

Other changes could be made to help reduce costs often passed along to renters or buyers, such as allowing greater variation in what materials builders and developers can use on homes. Rather than being required to use brick or stone on a certain portion of the facades of multi-family structures, developers are increasingly asking to use wood or traditional siding, city planning director Charles Bloom said at an October work session, which means less overhead cost.

These potential amendments to Cheyenne's Unified Development Code would likely come before the City Council early next year, Bloom said at the time. Seth Lloyd, a planner in the department, told council members in October that although reworking the code would be a lot of upfront work for city staff, it would likely reduce their workload in the long run.

Hannah Black is the Wyoming Tribune Eagle's criminal justice reporter. She can be reached at hblack@wyomingnews.com or 307-633-3128. Follow her on Twitter at @hannahcblack.