A $9 million redevelopment will help maintain low income housing

Back in the days of the Nixon administration the former governor of Michigan, George Romney, was working as Secretary of Housing and Urban Development. He had big plans for housing for the poor. 

Before his plans were derailed by Nixon, Romney asked for ideas on how to best design such housing.  He initiated the construction of homes in Operation Breakthrough, a revolutionary program that called for public housing that was not concentrated in downtowns, and was close to jobs and schools. To keep them affordable, they used a modular design. 

Some of those affordable homes were built in the Kalamazoo area and soon they are to be renovated so they can continue to be used as low-income housing. The housing complex is one of 10 Operation Breakthrough developments built across the country, most of which are no longer standing.

"We're proud are able to keep this development, and for it to continue to achieve the same mission that was set way back in the '70s," says David Anderson, of LIFT, a Kalamazoo nonprofit that receives federal and state funding to create and manage affordable and stable housing for people with low incomes locally.

The apartment community known as New Horizon Village will not only be completely renovated, but it will get a new name. The apartments will be known as Heather Gardens. 

There will be 79 low-income apartments--20 subsidized housing units for those with disabilities, 43 low-income units, and 16 market rate apartments and townhomes.  

Residents will have access to a playground, athletic fields and a basketball court, a swimming pool, and a community center that is being built.  A community garden also is planned for the property.

In addition to the new community center, there will be a computer lab and residents will be able to meet with those assisting them with job applications or for youngsters to receive help with homework. Some who move in might have additional support services such as case management tailored to their physical or psychological needs. 

The units range in size from one-bedroom apartments to four-bedroom townhomes. Renovations will be extensive on the development, constructed in 1972, which became a LIFT property in 2010. Anderson describes the renovations as a preservation and repurposing. "These are existing units that are desperately in need of rehabilitation." Interior and exterior work, including new roofs are planned.

The renovations are being paid for by $9.2 million in funding from the Michigan State Housing Development Authority (MSHDA), using a combination of Low-Income Tax Credits and other MSHDA funding, including a loan. Anderson explains that the IRS tax credit program has become the single biggest government program to fund low-income housing. 

The project also received a $20,000 grant from the Kalamazoo Community Foundation, which Anderson says "was critical in receiving the LIHTC award from MSHDA."

Anderson says it is difficult to pin down exactly what the gap is between the affordable housing available and that needed by the community. A Kalamazoo County Community Action Agency report from 2013 states that for a variety of reasons low-income housing is in short supply in Kalamazoo.

The number of new homes being built during the study period dropped each year,  from 1,867 built in 2004 to 470 built in 2012. During this same time, the average cost of new homes. for the most part. increased over time--the cost of purchasing a new home in 2012 was over $50,000 more than in 2004. 

"Taken together, these data suggest that both the availability and affordability of good housing options in the Kalamazoo area declined over recent years," the report says. "Additionally, with fewer new home options in the area, it is likely that people looking for homes or who rent homes are choosing increasingly from older existing homes, which are likely more expensive to maintain and less efficient with respect to utilities."

The study goes on to say that an estimated 39,000 people in the county live below the federal poverty line--$22,000 for a family of four. Anderson estimates that there are about 5,000 to 6,000 units of affordable housing distributed among 63 developments in the county. And one-third of those are senior housing. 

Putting it all together, the need for assistance in paying for or maintaining affordable housing in the Kalamazoo area has increased considerably since 2004. 

"Our community has an inadequate supply of affordable housing," says  Suprotik Stotz-Ghosh, vice president of Community Investment at the Kalamazoo Community Foundation. "Through the LIFT Foundation’s efforts, we are pleased to contribute to increasing access to this critical community need. LIFT is well-equipped for this project, with their history of demonstrated success in operating and renovating low-income housing for our community."

LIFT has been working to address the community need for affordable housing since 1966. Over those 50 years, the complete ending of HUD created subsidized housing due to political decisions has had a profound effect on the availability of housing, as has the increase in homelessness, Anderson says.  

The investment in assisting people with housing has remained fairly static. Over the course of time, the country has moved from public housing -- government owned and managed housing -- to privately owned and managed, he adds, interjecting "there's nothing wrong with that."

The problem that has arisen, however, is that at a time when homelessness is on the rise there has been no growth in the voucher program intended to give low-income residents a choice in where they live. 

"In Kalamazoo County, you cannot even get on the waiting list to get a voucher. The list closed in 2006," Anderson says. The list opened for one day that year and has been closed ever since. 

"All the places where you could sign up, there were lines around the block, as if the Rolling Stones had come to town. They accepted many, many applications and that list still exists. People have been on that list for a decade."

From there, Anderson moves to national housing policy. "In an age when we are noting that there is stagnation in income growth you have to address it one way or another." When costs increase and income does not grow, Anderson says, "that drives a further need for affordable places for people to live. Housing is a commodity like anything else. You have to pay people to build it and you have to keep it up and it's an investment."

What is surprising to many is that federal housing programs subsidize more high-income families than those with lower incomes through the $100 billion government spending program for mortgage interest deductions.

The nonpartisan Center on Budget and Policy Priorities says that more than three-quarters of federal housing spending in 2012 (counting both federal outlays and the costs of tax expenditures) went to homeowners.  And although 55 percent of the nation’s households are renters, renters received less than one-fourth of federal housing subsidies.

"We subsidize housing in this country for every income," Anderson says. "We allow people to deduct their mortgage interest when they buy a house. Who does that help the most? That doesn't really help a family that bought a $40,000 house. Their interest is going to be so small it would be better for them to take a standard deduction. Who it helps is people who buy $1 million homes and who pay large amounts of interest on that mortgage. I'm not saying it's a bad idea -- we just don't think of it that way."

At a time when the Kalamazoo Gospel Mission is housing people who have lived there for years, Anderson says he hopes people recognize that shelter is not permanent housing. Affordable housing has to be supported if people are unhappy about the numbers of people now in local shelters.
"Decent, safe, affordable housing is a critical component of quality life and it is the basis for all else," Anderson says. "If you have a place that you can afford, and your not worried about it, you can go to work, you don't have to move all the time and your kids can succeed in school. I hope people can continue to recognize how important that this."

Kathy Jennings is the managing editor of Southwest Michigan’s Second Wave. She is a freelance writer and editor.
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