Council president pushes for extension of affordable housing bill

Economic downturn has limited development, impact of measure, advocates say

September 21, 2010|By Yeganeh June Torbati, The Baltimore Sun

The Baltimore City Council will consider extending a 2007 law aimed at providing affordable housing in new city developments, though supporters acknowledge that the initiative has had little impact in the midst of a deep housing downturn.

Housing advocates praised the Inclusionary Housing Act when it was passed during the heady housing boom, when glitzy Ritz-Carlton condominiums in the Inner Harbor were being touted as signs of a redevelopment rebirth throughout Baltimore. At the time, affordable housing supporters said the legislation would ensure that low- and middle-income residents wouldn't be lost in the shuffle.

The act required developers of projects of at least 30 units that receive public subsidies to set aside 20 percent of the homes as low-cost units. Though the measure was backed by a coalition of religious organizations, unions and urban advocacy groups, it had a hard time making it through the council because some believed it would chill development.

The final bill included a sunset provision with 2012 as the expiration date, a condition that City Council President Bernard C. "Jack" Young said he hopes to overturn this year.

"My inclusionary housing bill is positioned to have a profound positive impact on the lives of Baltimoreans by ensuring that people from all economic backgrounds have access to decent and affordable housing," Young said in a statement.

But a protracted downturn in the housing market and deep recession have gouged the city's real estate prices in the past two years, leaving a glut of houses for sale — and for cheap.

For example, the developer of the Ritz-Carlton Residences secured a loan this year to refinance the project after dozens of units remained unsold.

The Union Mill development in Hampden is the only project subject to the 2007 law that has been built since the law was passed, providing 10 units of affordable housing, said Lester Davis, a spokesman for Young's office. Two other developments built since 2007, but not subject to the law, voluntarily included some affordable housing, he said.

On Monday, Mayor Stephanie Rawlings-Blake announced the redevelopment of the Barclay/Old Goucher area, which would provide 72 units of affordable housing. But that development is also not subject to the 2007 law.

"Development has slowed," Davis said. "A lot of things have stalled."

In fact, the median price of a home sold in Baltimore this year was $82,000, a 44 percent decline over last year. The average sold price was under $137,000, a 25 percent decline over 2009, according to RealEstate Business Intelligence, which provides market statistics for the Mid-Atlantic region.

Despite the housing downturn and decline in prices, bill backer Mel Freeman, executive director of the Citizens Planning and Housing Association, said he believed there still is not enough affordable housing in Baltimore.

"The benefit is that this law does provide an opportunity to have more low-income housing," he said.

Freeman argued that removing the sunset provision will finally give the measure enough teeth to have an impact.

"Getting it removed does allow the law to actually create some affordable housing," Freeman said. "The provision has been in place but no one's been doing anything."

He said he also thinks some developers have been biding their time to launch new projects in Baltimore until the requirement expires.

But Joseph T. "Jody" Landers III, executive vice president of the Baltimore Greater Board of Realtors, said the sheer number of houses in Baltimore on the market, and the low prices at which they are selling, has kept developers away in favor of more robust markets in Baltimore County.

"We're not out of this housing downturn yet," Landers said. "This city in particular has always had more affordable housing and now it's more affordable than it's been for the last 10 or 12 years."

june.torbati@baltsun.com

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