WILMINGTON — Every year, the City of Wilmington creates an actual plan to distribute federal funds to support affordable housing. The plan gives an overview of just how difficult it is to find affordable places to live. It also gives residents have a chance to weigh in the plan before it is finalized next month.
This year’s plan acknowledges long-term issues, as well as more recent strains on region’s renters and homeowners, including two hurricanes and a global pandemic. It also makes some modifications to earlier plans, shifting money towards Homebuyer Assistance Loans (HOP).
From bad to worse
Over the last decade, the annual plan has acknowledged the increasing pressure put on the housing market; as Wilmington’s population grows and its available acreage shrinks, luxury-range housing has squeezed out affordable units, leaving almost half of the region ‘cost-burdened’ (i.e. spending more than a third of their income on housing).
The numbers laid out by the action plan tell the story pretty clearly:
- At least 45% of renters are cost-burdened, along with 29% of homeowners
- Housing prices have increased 22% over the last six years, while the affordable housing supply has decreased
- Rents increased 7.4% in 2019, outpacing the national average
- Wilmington’s population is expected to increase a third over the next 18 years, from 233,595 in 2019 to 311,381 in 2037
- Over half the jobs in Wilmington and New Hanover County are ‘lower paying,’ with earnings “below the income needed to afford [the] units available”
Those conditions have only been exacerbated by recent natural disasters, including Hurricane Florence, which damaged or destroyed over a thousand affordable housing units.
“Eighteen months since the September 14, 2018, landfall of Hurricane Florence, the city and region continue to recover, especially lower income households. At least 1,200 rental units are estimated to have been damaged from the storm, displacing lower-income households. As of the writing of this plan, several affordable housing developments for low-income households are still under repair and residents remain displaced, including subsidized housing at Jervey Homes (100 units) and Cape Fear Apartments (91 units). Another affordable development, The Glenn (500 units), has been demolished and will be replaced with new market-rate housing,” according to the city’s plan.
While around 200 units at the Market North developed have reopened with subsidized rent, in general, the combined forces of market pressure and hurricane-related housing loss “leaves low-income households, including those displaced by the hurricane, with few options for affordable housing.”
The plan notes that, right now, Covid-19 is an unknown but potentially negative factor in the housing equation. Long-term unemployment, and economic damage to non-profits that usually help provide housing solutions, could worsen an already tough situation.
This year’s plan
Wilmington’s plan, as required by federal law, lays out the use of U.S. Department of Housing and Urban Development (HUD) funding for jurisdictions receiving Community Development Block Grant (CDBG) and HOME Investment Partnership Program funds, among other HUD fund
“In accordance with that letter, the plan allocates $1,040,399 CDBG and $692,384 HOME. In addition, the plan identifies prior-year funds of $630,826 CDBG and $1,589,723 HOME that are allocated to activities in progress as of March 20, 2020. Finally, the plan recognizes Revolving Loan/Program Income of $1,587,231.69 prior years and $950,362 for FY2019/20, and $674,704 General Funds allocated for public service activities, including the Continuum of Care,” according to the plan.
The plan also includes ‘reprogramming’ — that is, changing where certain funding goes — with an emphasis on homeowner assistance programs (HOP).
“Adoption of the FY2020/21 Annual Action Plan (AAP) authorizes the reprogramming of CDBG Funds allocated to various projects and programs as follows: $517,825 from CDBG Revolving Loan Fund for Owner-Occupied Housing Rehabilitation Loans to Homebuyer Assistance Loans, aka HOP; $83,335.13 from prior year Activity Delivery to HOP at $33,335 and $50,000 to Limited Assistance Grants; $123,155.79 from Cape Fear Habitat for Humanity to HOP; $9,731.45 CDBG Public Facilities project with Community Boys & Girls Club to HOP; and $1,252.67 CDBG Public Services program with Coastal Horizons to HOP. These changes address prior year funds that have not been expended and reprogram funds to active programs.
You can find a complete version of the draft annual action plan here.
For those who would like to weigh in during the Public Comment Period, email the Wilmington City Clerk’s office at penny.spicer-sidbury@wilmingtonnc.gov no later than 5:00 p.m. on Friday, May 8, 2020.
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