By Ann E. Marimow
Washington Post Staff Writer
Wednesday, July 12, 2006; B01

Montgomery County officials took steps yesterday to address the scarcity of affordable housing by trying to make it easier for middle-class workers to buy and rent homes in Maryland's largest jurisdiction.

Unlike past programs that have targeted the county's poorest residents, the initiative approved yesterday is aimed at helping workers, such as teachers, firefighters and county employees, who are increasingly being priced out of the housing market in one of nation's wealthiest suburbs.

The measure, passed unanimously by the County Council, would lead to the construction of as many as 2,500 units over 20 to 30 years in urban areas surrounding Metro stations, officials said. Many in the building industry opposed the measure, calling it a costly mandate.

After the 9 to 0 vote, the measure's sponsor, council member Steven A. Silverman (D-At Large), called it a "modest step." But, he said, "This is an acknowledgment that we've moved well past an affordable housing crisis into a middle-class housing crisis."

The new program would expand the county's trendsetting initiative, which has created 12,000 units for lower-income residents since the mid-1970s. Home builders have been required to set aside 12.5 percent of large new developments for people who earn 65 to 70 percent of the Washington area's median income.

In a 100-unit condominium building, for instance, developers must include 13 so-called moderately priced units. Under the new program, the developer would be compelled to set aside an additional 10 percent of the remaining 87 units -- or nine units -- for "workforce housing." That is housing affordable to people who earn 80 to 120 percent of the area median income -- about $89,000 for a family of four.

"It's another rung in the ladder," said Rebecca Wagner, executive director of the Community Ministry of Montgomery County, an interfaith coalition that helps poor residents find housing.

Participation would not be limited to public employees, although preference would be given to people who live and work in the county or have a pending job offer. A family of four could earn as much as $106,000, and based on estimates from County Council staff, afford to pay $315,000.

Barbara Favola, chairwoman of the Washington Area Housing Partnership, said she was unaware of any other local government in the region that has tried to help homeowners at that income level. Local officials, with limited resources, are "torn between targeting people who really have no options versus folks who have some options. We need a range of options," Favola said.

Council member Tom Perez (D-Silver Spring) sought to temper expectations among Montgomery residents who intend to enter the eventual housing lottery.

"I don't want to create the misimpression that we've solved the problem," he said. "There is no one magic fix."

The success of the program depends heavily on volatile factors such as the cost of construction, financing and the economy, said Elizabeth B. Davison, director of the county's Department of Housing and Community Affairs.

After the vote, Davison said she expected County Executive Douglas M. Duncan (D) to sign the measure. She said, however, that some issues still need to be worked out to make the program a reality.

"It's very hard to know whether we'll get workforce housing, or if the effect would be to kill off any kind of development at those locations," she said. "That's the unknown question."

Representatives of the development community have said the burden imposed by the mandate would force the industry to subsidize the less expensive units or pass on the costs to other occupants.

"Enough is enough," said Robert H. Metz, an attorney for the builders and developers. "It's very unfair."

He questioned the premise that middle-class workers with families would want to live in high-rise buildings near Metro stations.

Jim Humphrey of the Montgomery County Civic Federation also challenged the assertion that the program could result in 2,500 units. The council, he said, has given developers too much lead time to submit plans before the new requirements would apply. He predicted a "tidal wave" of building proposals for areas near the Bethesda and Silver Spring Metro stations before the December deadline.

Humphrey's analysis projects as many as 600 new units by 2014, largely in the neighborhoods surrounding the Shady Grove, Glenmont and Forest Glen Metro stations.

"This isn't a real solution to the problem of housing affordability; this is just a good-sounding program to tout while running for reelection," he said, in a reference to Silverman, who is running for county executive.

The price of housing has emerged as an issue in the contest to replace Duncan. Former council member Isiah Leggett, who is challenging Silverman in the Democratic primary for county executive, called the measure "more style than substance." He said he would have held out for a more sweeping approach to creating affordable housing.

Silverman responded that he is "building on what we've had in the county for 30 years."