A bill to establish an independent city housing corporation was introduced last week by D.C. Council Chairman Sterling Tucker. Its primary function would be financing the development and rehabilitation of multifamily rental units for low- and moderate-in-come families.
The Tucker bill differs from those already before the Council in that it would set limits on developers' and landlords' profits, tenants' rents, and homeowners' downpayments and monthly payments. It differs from an earlier Tucker bill that alos extended to commercial development.
Efforts have been made since 1975 to create a housing corporation similar to those set up by most states. Failure to do so has cost the District the special Section 8 rental subsidy funds it would have been eligible to receive from the Department of Housing and Yrban Development.
Efforts to create a corporation have been thwarted by opponents who point to the chaos that engulfed the New York State housing corporation when it found itself borrowing short and lending long a few years ago.
Tucker modeled his proposed housing fund, which takes income and cost standards in consideration, after the Massachusetts Housing Finance Agency. This agency been perhaps the most successful in the country in development multi-family housing with a specified percentage of low and moderate-income households in each project.
the District fund is designed to compliment, not supplant, private sector development and public housing. A quarter of the rental units constructed, rehabilitated or financed through the fund would be reserved for families with incomes low enough to qualify them for public housing. The latest count of public housing showed that the city has 11,918 units, while there is a waiting list of 7,770 households for such housing. Applicants now waits up to seven years for public housing.
The fund would make 90 per cent loans to commercial sponsors (and 100 per cent loans to non-profits sponsors) at below-market rates. Profits would be limited to 8 per cent a year. The units, however, would be exempt from rent control.
At least half of the sale units financed by the fund, would be required to be reserved for families of moderate income. Downpayments would not be allowed to exceed 10 per cent of the price and all monthly payments - including mortgage, taxes and utilities - could not exceed 35 per cent of the purchaser's income.