Housing need cost burden and policy tools
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The source document
The county’s agenda for Board of County Commissioners, May 21, 2024
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What was said
Machine transcription of 24m of recording, with speaker names inferred from voice matching. 19% of 70 lines carry a name. It shows what was said, not what was decided, and both the words and the names can be wrong.
So, first, I just want to thank you for giving me this opportunity and giving my students the opportunity to work with your wonderful staff. It's been a great experience for all of us. Now, my role today is largely to paint a broad picture of housing need and some approaches you might take to address it. We do have a written report of 70 or 80 pages, so that will have all the details that you could possibly want. But today I'm going more big picture. picture and some of the your staff uh the department heads are gonna fill in in a more granular granular level. So
I guess the good news is that Pasco County must be an amazing place to live. And I say that because people keep coming here. So that's the good news. The maybe not so good news is that it leads to rising housing costs. The increasing price of housing is felt everywhere, but certainly among renters, definitely among home buyers, but the ones who feel it most, as we'll discuss today, are those earning lower than average incomes. These residents are important members of your community. They're
your healthcare workers, they're your cashiers, they're your teachers, they're even your county employees. And so it's important that we make sure that they are. part of the county's feature. Now it's important to understand that improving the county's housing situation does not have one solution. You need to have a variety of tools in your policy toolbox, and you have to be creative in figuring out which tool best addresses which question. So, for example, there are some tools that are great for incentivizing market rate housing. And so that's going to be less on the
subsidy side and maybe more on the land use side. to serving people at 80% of the area median income or lower, AMI as we say, then probably just land use tools won't be enough. And that's when you need to have other kinds of subsidies and incentives to make the to make it pencil out for people at lower income. So, to start, I want to make sure that we are all on the same page about what some of these terms mean. So, as Kathy mentioned, when we talk about affordability, the federal definition for many, many decades has been
that if you are paying more than 30% of your gross income for your housing costs, your housing is not affordable. You are considered cost-burdened if you're paying over 30%. And so on this slide, you can see what affordable housing looks like based on different household incomes. Now, let me just clarify that to make this sort of a simple overview, I'm just doing averages of median income. So Marcy will provide a table that sort of breaks this down more by family size, but just on average, you
can see what different income levels are, what you can afford to pay at that 30%. Affordability threshold and so what income what what rent you could afford or housing costs you could afford based on that income. And what you'll see as we go along is that there's a disconnect between what people at 50 or 80 percent of AMI can pay and what people uh what what rents and housing costs actually are in the county. And the next two slides further explore. This concept
of affordability as it applies to your residents. These slides are asking who in Pasco County is cost-burdened. In other words, who is paying more than 30% of their income for their housing. So if you look at this slide, which is about renters, you'll see that clearly those under 80% of AMI are the most affected. And the lower we go with income, then the more More people are cost-burdened. And so by far the majority of Pasco County's cost-burdened population, which
is the column on the right, are people who are earning 80% AMI or lower. That's, I think, 80, 84% or so of all cost-burdened folks or renters are in that category. And that doesn't change much when we look at homeowners. So homeowners also, while many people may be feeling a pinch if they're looking for housing now, those earning higher incomes are usually able to make it work in a somewhat affordable way. But lower income people here, even among homeowners,
are squeezing their incomes to try to afford housing. I also wanted to take a brief look at who are the people earning these 80% AMI or lower wages. And so you can see that these are people, not just unskilled laborers, but also teachers and bank tellers and building inspectors. You know, I've often seen people talk about affordable housing as something undesirable, and the people who live in affordable housing. are stigmatized, but
all of us every day not only are uh encountering people but are dependent on people who are at these income levels. And so I think it's important to make sure that they are included in any plans we have for housing in the county. And so this uh slide is a snapshot of on average what it costs to buy or rent today and who can afford it. Now, again, if you've lived in your residence for a longer period of time, you probably have much more affordable housing. Your rent is lower, you
you bought it at much less, your interest rate was lower. But today, if you're looking for an apartment or looking for a house, these are the averages, and these are the incomes you need to be able to afford that average rent or that average home cost. Now, the next couple of slides are maps, and they address the question of where in the county do we find the greatest housing need. And so, with some exceptions, our cost-burden renters, and the slide is renters, tend
to be concentrated on the eastern and western boundaries of the county, largely in and around the municipalities. So when you look at this map, you'll see the very dark red census tracts. In those census tracts, 75% or more of all renters are cost burdened. So, like basically everyone is cost burdened in these census tracts. The dark orange, 50 to 75% of renter households are cost burdened. Still a very large number. So you can look at that map and sort
of see geographically. What we are talking about.
Now, here's a map with cost-burdened homeowners. You can see that they are more dispersed. And also, I want to point out that the scale on this map is different. So that the dark red census tracks on this map, these are homeowners who are cost burdened. And the dark red means 30% or more of homeowners are cost burdened. Why are the scales so different? Just because on average homeowners are more affluent and less likely to be cost burdened. So it's just
a different scale of need. Um And then this map I'm I've um I've put here because I think it's really interesting how much of a correlation there is between areas with older housing stock. And areas where high levels of cost burden. Because what's that is showing you, because here again the darker colors are older housing. And so what you see is that the areas where we've seen the most, the highest cost burden, biggest housing need,
are also the areas where the oldest housing stock is located. And so, what that means, it's relevant to policy because it means your poorest households are living in the oldest, most in need of repair, most dilapidated housing. And you'll see that when we talk about policy, we will focus on that source of problem. If people's housing is in very poor shape, to the point where it becomes unlivable, then that uh decreases the amount of
Also, I want to note that this particular map, which is there's like basically a dot for every property, includes mobile homes. 17% of your housing units are mobile homes. And what I found interesting and somewhat surprising is that the vast majority, almost all of them, were built before 1994. Now, why is that significant? Because 1994 is when we see new higher standards. standards for mobile homes. So anything built prior to 1994 was built to an older standard. And that's what
you have in terms of your mobile housing stock. Now let's look ahead because when we're talking about building housing and planning for housing, we're not talking about what are we doing for the need today, we're talking about what are we doing for the need tomorrow. So, what does the future hold? There's always uncertainty when we plan for the future. We don't know exactly what will happen, but we can look at trends and project ahead with some confidence. So this slide is the projected employment and its power. And Hernando County together, but
Hernando County is about 20% of this, so it's mostly Pasco. And what you can see looking to 2030, I've put here the 10 fastest growing job titles and the wages associated with them. And so some of these faster growing areas are fairly high wage, but the majority of them are low-wage jobs. Retail and weight staff and lawn service and that sort of thing. And so what that means is that a lower income group
will be here in the decade to come. And I know that you are all working very hard to bring in higher value employers, employers like Moffitt, but even when you're bringing in a Moffitt for every MD and PhD they Higher, there will be three to five support workers who make a lot less than the MDs and the PhDs, and they need to live here too. And then also, this is sort of consistent to what we see when we get data from the University of Florida
Schimberg Center. This is looking at cost burden, looking ahead to 2050. The top row is projections for percentage of renters that will be cost burdened, and you can see that remains in the 40 to 50 percent range. And the bottom row are homeowners, and we're looking At between a quarter and one fifth of homeowners likely to be cost burdened if current conditions continue looking ahead to 2050. Um so what else do we see when we look ahead? This is probably not a
surprise to you because your your planners tell you this all the time, but your population will keep growing. And so looking at these projections, it looks like you're going to gain a couple of hundred thousand people in the next couple of decades, and they need to live somewhere. And so if we assume two to three people per household, so if you're gaining 200,000 individuals, you're looking at 80 or 90,000 new housing units you need. Now that's over a long period of time, but don't forget that's just to house the newcomers. We
still have the deficit of housing for lower income people that exist today, and we still have older housing that could be going into disrepair that needs to be replaced. So that's a lot of new housing. And if we're looking ahead to let's say 2040, you know, the planning for that starts today.
Did you know we're supposed to hold off on questions? questions. Yeah. Hold
on questions. I'll
write it down for you.
Okay. So now we get to policy. So what approach can the county take to address some of these deficits? Now as I said to start, I wish I could say it's like you do this one thing and housing problems go away. But housing is super complex. You all know that. So it's a multifaceted approach, and I'm just gonna give sort of headlines of a couple of strategic areas that I think are good to look at. Yeah. Um and um and don't worry if I'm going quickly because I'm gonna go th into through each
of these bullet points. So the first sort of gets at what we had talked about a little bit before with the age of housing in which lower income people live. And that is making sure that we retain the affordable housing stock that we have. So part of that is going to be sort of market-based affordable housing. Sometimes in the field it's called naturally occurring affordable housing. In other words, it's not subsidized, it's not rent restricted, it just happens. To be lower cost. And so to maintain that housing supply,
which is where most low-income people live, we need to look at rehab and other ways that people stay housed, even if they encounter some kind of financial difficulty. Now, the county already has a homeowners rehab program and also has a program to help people out if they are in tax arrears. And so that you don't need to reinvent the wheel, but I think those programs should be serving more people. I think they should be broader and should be more robust. Even perhaps consider, let's say, helping people with homeowners'
insurance, which these days may be more than their property taxes. And so helping people pay that homeowner's insurance could mean that they're able to maintain their homes even if a storm comes.
The other thing I think we need to do regarding affordable housing maintenance is making sure that the current assisted housing stock you have remains affordable and habitable. So, as most of you know, when you have assisted housing, it's usually funded by the state or the federal government. There's some kind of a contract that runs several decades that says we will give you a subsidy and you will keep Rents low. Well, those contracts end. And so you have housing that was built 10, 20, 30 years ago
where the contracts are going to expire. And so to make sure that those remain affordable and remain in good enough condition to be habitable, it often takes some local government action to make that happen. You don't want to have affordable housing kind of dropping out the bottom as you're trying to put more in on the top. So the other thing I think is sometimes we just need to give money to people. And you already do this because you have a down payment assistance program. And that's to help homeowners who qualify buy a
home. So we're ex suggesting expanding that, thinking about different ways to make it more accessible to more people. Considering the rapid increase in the price of a typical starter home, it may be that the limits you have on it now are just not realistic. And so those are things that we've discussed. The other thing I wanted to mention is rental assistance. During the pandemic, then you used the federal ERAP program to provide rental assistance. You worked with nonprofit partners to do that, and that
kept people from being Evicted. So those particular federal funds are gone, but there's other federal funds that could be used for that. Now, not everyone is wild about the idea of handing people money because they didn't pay their rent. But let me just point out that sometimes people are getting evicted because they had you know lower hours one month and couldn't pay a month's rent, and so over $800 or $1,000 they're getting evicted. So when you think about it in terms Of being cost effective, sometimes paying two months' rent means that the
landlord's not incurring expensive court costs, a family is not ending up having to move in a sort of a forced way, and if that family were to end up homeless, you're not spending $2,000 on them, you're spending $20,000 and more. So a well-targeted emergency rental aid program can, in fact,
Yeah. Now, also, you don't have to be an economist to know about supply and demand affecting the cost of things. So, right now, you have a short supply of housing, at least at certain price points. And so that means that the costs of housing are going to go up as your population increases. And so it's important to make sure that we always have our eyes on the prize, which is building more housing. And that means making sure housing Housing can be built at every price point. Now, building for people at over 100%
of income or 120% of AMI, that doesn't require subsidies, but it may require some other policies I'll get to in a sec. But building for people who earn 80% of AMI or less usually requires some kind of subsidy. And so incentives like waivers or bonuses can help bridge the gap between what people can pay. And what a developer will tell you is important for them is is what they need to make uh to make something work. And um that gets me to my next point, which is one of the things that's really
key to any kind of local housing policy is using land strategically. We are not making more land. We have what we have. And so we need to make sure that what land we have that is in any way appropriate for affordable housing or for housing is used for that purpose. Also, you all have amazing amounts of open space and recreation space. You don't want to give that away. You also have agricultural land. You don't want to give that away. And so what that means is that the land you have
that is possible for building needs to be used really efficiently. So one thing that I mention is thinking about surplus public land.
I know you don't have CRAs, but municipalities do. School district, there are a lot of local and State agencies that hold land that can be declared surplus. And when you use surplus land to sort of have RFPs to build affordable housing, it's great for the county because you get have a lot of sway over what gets built there. You have a lot of carrots and sticks you can use when it's your land, and that can make sure that the projects are affordable. And so I would encourage you to look closely at what land. and could be deemed
surplus, and then to you look at mechanisms like community land trusts or land banks as ways to hold and manage housing. But perhaps even more importantly is the other part of using land efficiently is thinking about zoning. Um and um you you know r regulations are important. We don't want people to, you know, building wetlands and all that, but we don't want to have regulations that unreasonably prevent us from building housing. And you are not likely to meet all of your housing and
affordability goals if the only thing you can build in Pasco County is a detached single-family home. You just won't get to the number of units you need at the price point you need. And so there are ways to introduce greater density, and I know density can be a scary word in many situations, but it doesn't have to be scary in practice. You don't have to look like Miami Beach or Manhattan to have greater density. So you may have heard terms like missing middle or gentle density. And these refer to
housing types like accessory dwelling units or ADUs. Duplexes and triplexes that can be integrated into a single family home neighborhood without changing the neighborhood's character. But to get housing at scale, you still need more multifamily housing. And so you especially need that around areas that are convenient transportation routes and near employment centers. You do not want a situation where your lower wage workforce has to commute 45
minutes from three counties over. You want them here. And so to uh to do this you need to think about where you can accommodate more density because uh denser housing with smaller footprints is always going to be less expensive. If large-scale upzoning is not realistic, then at least think about density bonuses, which you can use and negotiate for affordable housing units in exchange for those bonuses. And finally, of course, scaling up your housing policies requires that
you have the appropriate partnerships and staff capacity to carry out new and expanded programs. You can build on existing partnerships with housing nonprofits. You can develop new collaborations. I've heard others like David Lambert mentioned talking to employers. Employers have a huge interest in affordable housing. If I'm the CEO of a hospital, I need to have people who don't earn a ton of money and they need to be working around the clock. And so I need to have them living nearby so that they
can get to their midnight shift. And so working with these employees. To see what they might have available in terms of surplus land or resources or simply support that they can give in various ways. Also, we're talking about making programs more robust and expanding programs. And of course, you need to make sure that you have the staff in place that can handle those new responsibilities and that there's training for existing staff so they can take on new tasks if that is indeed what is required.
The goal is a healthy housing market. We want housing options for the doctor and the home health aid, for the CEO and the receptionist. And there are multiple tools and strategies the county can use to get there. Thank you very much. Um do you want to do you want me to take questions now? Okay, so I'll stay here for your questions. Ms. Darkey? Yes, I wrote it
down. When you said we were 80,000, we were in need of 80,000 units, um, is that above and beyond what we've Um may not what we've encumbered but maybe haven't pulled permits. I mean we
No, it's not. I'm I'm just looking at the population projection and saying that two hundred thousand people are going to need eighty thousand units. So there may if you've already permitted eighty thousand units then y then you know that takes you part of the way
we may not have permitted them but we may have given them um approvals to move forward. What's the right planning order? Entitlements. Right. I would Wonder how many entitlements we have out there that Our potential.
Say that some of them may be potential, but most of those units. are not restricted to being affordable.
No, no, yeah. But but she didn't say we need eighty thousand affordable units. But
just to accommodate new incomers you would need about eighty to ninety thousand new units.
We don't I just don't have another I just wondered if that was above and beyond what we've entitled. But it it sounds like it isn't. So but thank you. I loved your presentation. Yeah. quadruplexes that I just saw up in Louisville. Um when we get to us talking. So
Yeah, yeah. I mean the fact is when you look at really well designed quadruplexes and ADUs, I mean they look right. Nobody would say, Oh my god, I don't want that in my neighborhood. Yeah. You didn't it you didn't mention the word ADU? Um I you know what I skipped over something where I had meant to mention it. So I I did want to mention that a lot of the your your neighboring counties and municipalities have recently um permitted ADUs. You all have that just in very few master plan areas where people can have like an apartment over a garage, but for countywide you we can't have you can't
build an ADU. Yeah, I've been asking and asking and asking,
and I think
it's in the
works, but for a couple years I've been Starkey, we we're gonna cover that later in the presentation. Okay.
Yeah. But anyway, yeah, I think um St. Pete, um city of Tampa, and some other counties have now uh included. And they have different a different range of regulations about size and appearance and all these things to make it more consistent with the neighborhoods they're in.
I think you find out in in Pasco. Most of the houses, new homes being built, are way over three hundred thousand dollars. I mean they're four hundred thousand, five hundred thousand and not affordable for most people. I mean it takes two red winners working in a in a home bringing in good pay to be able to afford one of those houses. Absolutely. We uh We need a lot of housing that is affordable for our workers that are coming in for jobs we're bringing in. uh all over
the county. We don't have the housing for them yet, but we have to be and that's why we're having this meeting, 'cause we know we need workforce housing. So
thank you, Chairman
Mariano?
Thank you.
Okay, thank you.
Thank
you, Dr. Strong.
So we're gonna bring Marcy Esperg up and then follow Marcy will be the two David, David Ingall and David uh Goldstein. So okay.
Welcome Mercy.