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Today Meyer Memorial Trust announced a combination of nearly $6 million in grants and loans to establish the Oregon Housing Acquisition Fund. This statewide fund will be used to preserve and create affordable homes for 25,000 Oregonians.
“This project brings together an unprecedented team of partners to preserve and create affordable housing in our state,” said Meyer Memorial Trust CEO Doug Stamm. “We expect it to improve housing access for the most vulnerable Oregonians.”
Access to affordable housing is one area Meyer Memorial Trust selected for special focus following a year long strategic planning process to determine how Oregon’s largest private foundation could help address the state’s most intractable problems.
About three-quarters of Oregon’s very low income households spend more than 30% of their income on rent or mortgage payments. In the U.S., housing is considered “unaffordable” when more than 30-35% of household income is used for monthly housing costs.
To date, the fund has secured almost $33 million in pledges or expressions of interest. Funders include Enterprise Community Partners, the Collins Foundation, Tom and Bob Walsh, Oregon Housing and Community Services Division, and the City of Portland. A number of banks have also expressed interest in capitalizing the fund.
MMT and its partners plan to grow the fund to $50 million.
Between now and 2013, 7,300 rent-subsidized apartments in Oregon are at risk of converting to market rates due to expiration of government subsidy contracts. "Affordable housing developers struggle to meet the demand for homes because they lack rapid deployment capital to buy suitable buildings and sites," Stamm said. "The Housing Acquisition Fund is a response to these problems. Funds will be used to preserve 6,000 existing apartments and support creation of 1,200 additional affordable homes."
Ann Lininger, Director for Program-related Investing at MMT, helped to convene the Housing Acquisition Fund steering committee over several months while it developed this concept. The steering committee includes representatives of Network for Oregon Affordable Housing (NOAH), Oregon Housing and Community Services Division, the City of Portland, Enterprise Community Partners, the Community Development Law Center, Northwest Housing Alternatives (a nonprofit developer), Community Alliance of Tenants, Wells Fargo, Housing Works (the central Oregon housing authority), a former HUD executive, and private developer Tom Walsh. “This is a team effort that culminates work underway in the housing sector for years,” said Lininger.
According to Lininger, Oregon is in the forefront of statewide efforts to address the problem of affordable housing preservation. The recent transfer by Harsch Investment Properties of the 235-unit Clay Tower Apartments to Cedar Sinai Park was an early victory in the preservation effort and a significant contribution to this work by the Schnitzer family, she noted.
“It costs half as much to preserve and renovate an existing affordable apartment as it does to build a new one,” said Stamm. “By preserving affordable homes, we reuse and recycle important housing resources. This project is cost-effective and environmentally sustainable at the same time.”
“Through the leadership of owners like the Schnitzers and Walshes – and with the concerted effort of Oregon’s government, nonprofit, and private sectors – we can safeguard these subsidized apartments and the families who rely on them,” said Stamm.
NOAH will administer the Fund. The Neighborhood Partnership Fund is creating the Fund’s database and website. Gerding Edlen helped develop parameters for the Fund’s green building incentive program, which Enterprise Community Partners will administer.
“This is the right team, and this is the right strategy,” said Stamm. “This project holds promise to leverage significant support from out-of-state sources. The project’s green building element will reduce operating costs at affordable housing projects and safeguard tenant health. Most important, the project will preserve and create homes for 25,000 low-income Oregonians.”
The Housing Acquisition Fund’s six-year goals include:
• Preserve at least 80% of the 7,300 federally rent assisted apartments that are at risk of conversion to market rates between 2007 and 2013.
• Safeguard the almost $25 million in annual federal rent subsidy to Oregon associated with those units.
• Finance acquisition of land and buildings on which 1,200 additional units will be developed.
• Establish a cost efficient green building incentive program that will minimize operating costs and maximize indoor air quality in 1,000 apartments.
Fund partners are working with the state to secure the permanent financing for projects the Housing Acquisition Fund will support. At the February special legislative session, the Oregon Housing Alliance will seek financial support for preservation work.
“In some parts of Oregon, these subsidized apartments represent the only low-cost housing available,” Stamm said. “If they disappear, families could be forced to leave their communities in search of affordable housing. The Housing Acquisition Fund aims to keep Oregon home – for the holidays and beyond.”
This is the first part of MMT's Affordable Housing Initiative strategies. Further efforts will be announced as they are developed.
