Stepping Up: How Cities Are Working to Keep America's Poorest Families Housed

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June 16, 2015
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Stepping Up: How Cities Are Working to Keep America's Poorest Families Housed

June 16, 2015

Having a place to call home is a signature component of the American dream. But for far too many people, finding safe, decent, affordable housing is extremely stressful. The United States simply does not have enough affordable housing. And nationally, the situation is only getting worse.

This story is not about just counting homes. The affordable housing shortage has real consequences for families because millions of them pay more than they can afford to have a place to live, often at the expense of food, health care, and other necessities.

For extremely low-income families—those households earning no more than 30 percent of their area’s median family income—this pain is severe.

According to data from the Census Bureau and the US Department of Housing and Urban Development (HUD), only 28 of every 100 extremely low-income renter households in the United States were able to find decent, affordable homes in 2013. This stark decline from 2000, when 37 of every 100 could find housing, reflects both a loss of units and an increase in extremely low-income families.1

Without federal housing assistance, the situation would be even worse: the share of families who could afford adequate housing in 2013 would have fallen to 5 percent.

The first federal programs to tackle housing affordability were created in the late 1930s. Over the next decades, those programs allocated resources to big cities with big needs.

Since the 1990s, however, federal resources devoted to housing extremely low-income renters have slowed. And growing cities—mainly in the south and west—have suffered.

The national picture could get bleaker. In recent years Congress has cut, and shown additional interest in trimming, federal spending for housing assistance programs.

The data’s message is clear. No matter where you look , federal programs are not enough. As a result, state and local governments must do everything they can to preserve existing affordable housing units while finding ways to produce more.

Counties around the country face their own challenges when addressing affordable housing needs. These variations exist, in large part, because counties have different federal, state, and local assets to work with. Both the tools and counties’ ability to wield them reflect particular histories, political climates, and levels of local engagement.

Suffolk and Travis Counties—homes to Boston and Austin—are very different. The most obvious difference is that Massachusetts is very supportive of affordable housing, while Texas is not. Another is that Boston benefits from its legacy of federal rental assistance, while Austin has experienced more recent growth and is unable to keep pace with rapidly increasing need. But both are using multilayered strategies—some proven, some promising—to tackle their local affordability challenges. And both are determined to face an increasingly daunting task.


1. The research used the household as the unit of analysis. "Household" and "family" are used interchangeably in this feature. 

(Photo above) The Brooklyn borough of New York is shown in this Tuesday, April 20, 2010, aerial photo. Mayor Bill de Blasio has an ambitious plan to build or preserve 200,000 affordable housing units over the next 10 years for lower-income New Yorkers, a staggering number that would house more people than such cities as Atlanta or Minneapolis. Photo by Mark Lennihan/AP.

The Strength of a Legacy

On the border of the Boston neighborhoods of Roxbury and Dorchester, neatly tucked between the orange, red, and silver commuter train lines, sits a classic red-brick building accented with white windowpanes. Inside the Wilshire Apartments’ 29 units live 20 extremely low-income families who receive a federal housing subsidy known as Section 8 project-based rental assistance.

In Boston, this program helps families who generally earn less than 30 percent of the area’s median income—$29,550 for a four-person household in 2015—pay for rent and utilities. These families are typically much poorer than that: on average, Boston households receiving HUD programs had $16,261 in income in 2013.

If not for the efforts of Boston’s affordable housing community working in concert with dedicated local, state, and federal partners, the families living in the Wilshire Apartments would not be Section 8 beneficiaries. Instead, the building likely would have been snapped up on the open market years ago and converted into market-priced apartments that these families could never afford.

Building new properties in Boston that can meet affordable housing needs is difficult; construction is generally expensive, and vacant property is hard to find. Plus, this older, congested northeastern city has very tight zoning restrictions.


aerial view of the Boston neighborhood Roxbury

Aerial view of the Boston neighborhood of Roxbury in 1925. Photo courtesy of the Boston Public Library (CC BY-NC 2.0).


Thus, finding multilayered and creative strategies to keep existing housing affordable, reimagine it and the land it sits on, and expand it to serve more extremely low-income families have been central and persistent goals for the key housing players in the city and state.

To be sure, the county’s success to date is hard-earned and by no means accidental. Despite these efforts, nearly half of Suffolk’s extremely low-income families lack affordable housing.



Right Place, Right Time

Thanks to the state’s deep commitment to affordable housing, Suffolk is the top-performing large American county when it comes to providing housing for extremely low-income families. Another four Massachusetts counties place in the top 10 large counties with the smallest affordable housing gaps.

Suffolk was able to provide affordable and adequate housing for nearly 51 percent of its 74,262 extremely low-income families in 2013. This share is almost double the national average, and it’s nearly 3 percentage points better than the county was able to perform in 2000.

This is definitely a good news/bad news kind of issue. It’s all relative. These five Massachusetts counties, including Suffolk County, are doing better than the rest of the country, but the fact is the best is still pretty poor.


Roger Herzog
Executive director, Community Economic Development Assistance Corporation (CEDAC)

The seeds of Massachusetts’s relatively strong performance were sown in the ’50s, ’60s, ’70s, and ’80s. During these four decades, the state became an early beneficiary of HUD’s programs, developed effective state-run platforms, and created CEDAC to help produce and preserve affordable housing.

Under HUD’s fledgling programs, the federal government offered financial incentives for developers to build affordable housing; in return, the developers committed to keeping that stock reasonably priced for several decades. Section 8 project-based assistance and federal low-income housing tax credits were critical resources added later to the state’s affordable housing toolkit.

Massachusetts also invested its own resources. It created state public housing and state housing voucher programs, both entirely distinguished from their federal counterparts. The state also crafted its own low-income housing tax credit program during the late ’90s. Massachusetts even put together state financing for affordable housing—similar to HUD’s Section 236 program—called Section 13A.


Boston Housing Authority map of Archdale Road Housing Development, circa 1950s. Photo courtesy of City of Boston Archives (CC BY-NC 2.0).


“The state has historically, and continues to, put money into affordable housing, into vouchers, and into state public housing, which isn’t the norm across the country,” said Rebecca Koepnick, director of neighborhoods and housing at the Boston Foundation.

Given these opportunities, many counties in Massachusetts, including Suffolk, went all in. During those early decades, Boston built as many as 40,000 units for low-income and extremely low-income households.



Waves of Risk

Though HUD’s programs and Massachusetts’s willingness to use them boosted the number of affordable housing units in Boston early on, before long a significant portion of this supply came under threat.

The deals struck by housing developers and HUD allowed developers to pay off their mortgages after 20 years and rent the units on the open market, with no further requirements to lease to low-income tenants.

By the late 1980s, many Boston neighborhoods—including those with HUD-subsidized units—had recovered from the economic stress of previous decades. Many developers were tempted to opt out of the HUD programs and rent to higher-paying middle-class tenants looking to move back into the city.

This temptation to opt out was assuaged with national measures that created new incentives for developers to stay committed to their deals with HUD. But Boston took it even further. This first crisis prompted the development of what has become a very strong network of organizations—such as CEDAC—working to preserve affordable housing in the capital city.

“The preservation interest was triggered, particularly, by the circumstances of high rents and programs running out of contract terms, such that the housing was at a risk,” said Amy Anthony, who was the secretary of the Massachusetts Executive Office of Communities and Development from 1983 to 1990. “We hit that sooner than most places, because we had such active early development on the private developer side in early federal programs.”

Anthony is the founder of the Preservation of Affordable Housing (POAH), a nonprofit developer working in nine states and the District of Columbia to preserve and improve affordable housing.


South Boston triple-deckers are seen in the foreground with the downtown Boston skyline looming in back, Wednesday, January 15, 2003. Photo by Elise Amendola/AP.


Nonprofits, together with smaller developers known as community development corporations, mission-driven for-profit developers, and some financial intermediaries, form a strong fabric of organizations working in Boston to buy at-risk properties, expand their capacity, and ultimately keep them affordable.

This is an amenity few other cities have, and it has been helping Boston since the first wave of risk crested.

A second wave of risk followed in the late 1990s, when a lot of housing units with HUD Section 8 project-based rental assistance came up against their agreement expiration dates. City and state officials, CEDAC, and the developers collaborated, strategized, organized tenants, and negotiated with private owners. As a result, much of the project-based housing stock was preserved using available public resources.

A third wave of risk is playing out now. Agreements are again approaching the limits of their 40-year mortgage terms, and Boston is again having to find ways to meet this challenge.




With declining federal funds for public housing, the Boston Housing Authority is looking for support outside its normal ecosystem. Using a HUD program known as the Rental Assistance Demonstration, the authority is looking to lure more private-sector dollars into public housing.

“I am, quite frankly, very disappointed that the feds have taken a hike on funding [public housing],” said William McGonagle, administrator of the Boston Housing Authority. “Having said that, I would say that I am cautiously optimistic that through this vehicle we can … find ways to invest in public housing and maintain affordability over the long term.”

McGonagle also hopes to build in long-term affordable housing guarantees whenever public lands are leased to private builders looking to develop residential buildings. 

Another asset that allows Boston to navigate this ever-perilous risk of losing affordable housing is an early warning system set up and managed by CEDAC.

The system is essentially a fine-tuned database that provides detailed information about all the publicly financed, privately owned affordable housing in Massachusetts. Using this information CEDAC, the state, Boston, tenant organizations, and developers can strategize about the best time to buy expiring affordable housing and preserve it.


Girma Bealy, a member of the Roxbury Tenants of Harvard, talks on his cell phone during a break between plenary sessions at the Housing Boston 2012 conference in Boston Friday, April 27, 2007. South Boston and the financial district, in the distance, are shrouded in fog and rain. Photo by Stephan Savoia/AP.


Boston has another thing going for it: the Massachusetts Department of Housing and Community Development, CEDAC, and the MacArthur Foundation in 2009 created a fund that provides bridge loans to affordable-housing buyers looking to preserve properties, so they can act quickly when the alarms go off and these properties come to market.

An additional edge: the state legislature in November 2009 passed a law known as Chapter 40T that—among other things—gives the state the “right of first refusal” when owners of affordable housing properties are selling them without a commitment to maintaining affordability. In other words, the state gets first dibs if it wants to preserve the affordable housing.

Chapter 40T’s presence was integral to preserving the Wilshire Apartments for extremely low-income families. The apartments are about to be renovated and upgraded, but their future as stable homes for those in need is secure going forward.

Policy tools and the savvy players in Massachusetts and Boston that figured out how to combine and use them have led to Suffolk’s relative success. This legacy of benefits was available to counties like Suffolk because they were population centers when public investment came online and was significantly greater than it is today. For cities and counties that have grown large since that time, it is a whole different ball of wax.

Reenvisioning Austin

Head southwest from Boston nearly 1,700 miles as the crow flies and you’ll arrive in Austin, a chic Texas city known for its artsy culture, funky vibe, and easy-going ways. But it’s also undergoing some turbulent growing pains that include rapidly escalating housing costs.

In 1965—the year HUD was created and around the time Massachusetts began hardwiring itself to take on affordable housing—Austin was a sleepy little state capital/college town with a modest population of 214,117. That number more than doubled between 1965 and 1990, and it has nearly doubled again since, reaching 865,504 in 2014.

Austin is now America’s 11th most populous city. And, as the fastest growing city in the United States, its migratory inflow isn’t expected to slow down anytime soon. Despite these patterns, until recently Austin didn’t see itself as a big city, with big-city issues to tackle. So it didn’t cultivate a strong network of developers, lenders, and other organizations devoted to preserving or building new affordable housing.

Nor was Austin large enough, or sufficiently motivated, to attract the federal support for affordable housing that more established cities like Boston received in the latter half of the 20th century.

Texas state politics do not support the creation of robust state programs that fund affordable housing projects or interventions in housing markets. In fact, in several cases, the state legislature took housing policy tools away from Austin.

We don’t feel the love at the state level. There is not a tremendous amount of support in the state budget for affordable housing.


Betsy Spencer
Director, City of Austin’s Neighborhood Housing and Community Development

But within important city offices, urgency is building to confront this issue head on. Mayor Steve Adler and every member of the city council, except one, ran in 2014 on a platform of keeping Austin affordable.

“If we don’t do this now, in the next couple of years, it’ll be too late,” Spencer added. “We’ll be San Francisco. Now is the time.”



A New Day

As the recently sworn-in mayor took to the podium for his inaugural State of the City address on April 13, he knew it would be a pivotal moment for his administration—and for the policies he hopes will make Austin a more affordable place to live.

“We’ve got big-city economic pressures,” Adler told the audience. “If our artists, service workers, teachers, and longtime residents can’t afford to live here, we can’t be the Austin we’ve always intended to be. We have to make housing affordable for families at all income levels and at all stages of life.”


6th street in downtown Austin.


Indeed, Travis County, where Austin is seated, was able to provide housing for only 15 percent of its 48,057 extremely low-income renters in 2013—a rate 10 percentage points lower than the national average.

What’s more, an independent evaluator contracted by Austin released a report in 2014 showing the city needs at least 48,000 rental units dedicated to extremely low-income residents.

Clearly, both the city and the county have their work cut out for them.

HUD programs—such as public and Section 8 housing—and a federal housing tax credit program offer Austin some external support for its low-income residents. But the city also has a few tools of its own.

The biggest to date are general obligation bonds authorized in 2006 and 2013 specifically to finance affordable housing projects. The $55 million raised in 2006 was leveraged into $200 million and used to build 3,417 units for residents that earn less than 50 percent of the area’s median income. The $65 million raised in 2013 is still being put to work.

Austin also has a slew of density bonus programs that aim to convince for-profit developers to include a certain percentage of affordable housing units in their projects. In exchange, developers receive permission to construct bigger buildings with more units.

In addition, a small housing trust fund contributes, and policymakers hope it will soon generate $1 million a year to spend on affordable housing. When the city sells property and it is redeveloped, 40 percent of the new property’s tax base goes into the fund. The recent redevelopment of the Seaholm Power Plant and the Mueller community are examples of this policy at work.

Austin’s housing authority distributes roughly 5,400 Section 8 vouchers, has an additional 1,000 affordable units to offer through a subsidiary, and is bringing several more buildings into the fold.

“We’ve got a ways to go,” said Michael Gerber, president and CEO of the Housing Authority of the City of Austin. “There is a lot of room to improve, but there are a lot of very fine minds in the nonprofit sector and among policy development organizations … that are also putting a lot of energy into this and that’s exciting.”

Austin has some good tools and some skilled craftspeople. But the city needs more.

“We will continue to employ bonds and incentive programs … but they are not nearly enough to meet a gap this size,” Mayor Adler added. “We must also harness Austin’s innovation to bring more resources to this issue.”



Zenobia Bechtol, 18, and her 7-month-old baby girl Cassandra play in the dining room of her mother's apartment, where they live, Wednesday, December 14, 2011, in Austin, Texas. Photo by Erich Schlegel/AP.


Austin is rethinking the way it addresses affordable housing. Many of the city’s key players sit on a steering committee—spearheaded by HousingWorks Austin—to carry out one of Mayor Adler’s top ambitions: the establishment of a “strike fund” that would chip away at the problem by preserving 20,000 affordable units and building new units over the next 20 years.

The articulated aim of the fund is to seed it with about $1 million from the 2013 bond sales, then add $20 million to $30 million of private investment. From there, the fund would be managed and grown by a community development financial institution. Developers could use money from this fund to quickly enter Austin’s hot housing markets and snap up properties that could be preserved or used to build future affordable housing projects.

“We know that we need additional sources of funding,” said Mandy De Mayo, executive director of HousingWorks Austin and a steering committee member. “We really need to do a better job of leveraging those funds with private capital.”

Steering committee member Elizabeth Mueller—a community and regional planning professor at the University of Texas—used a HUD sustainable communities grant to develop a metric that helps the city identify and prioritize transit corridors containing ’70s- and ’80s-era unsubsidized, old, and cheap housing units. Once identified they can be targeted for acquisition and preservation before they get too expensive.

Ann Howard—the executive director of the Ending Community Homelessness Coalition (ECHO)—believes that Austin already has the ingredients to generate more private capital investment for such ends.

We don’t [yet] have the mature philanthropic community that old cities have, [but] Austin is home to the largest venture capital–type programs in the state of Texas. So there is plenty of money here to help try these new models of funding, and we’ll just have to be able to harness that.


Ann Howard
Executive director, Ending Community Homelessness Coalition (ECHO)

ECHO has gotten off to a good start: it recently received a small subgrant from the Corporation for Supportive Housing to study the feasibility of using a “pay for success” transaction to develop supportive housing units and wraparound services for Austin’s homeless residents. These grants are financed through the Social Innovation Fund, a program of the Corporation for National and Community Service, and they include matched funding from other external funders.

The steering committee also believes that the key to attracting more capital is promoting the holistic benefits of affordable housing. If Austin can house low-income residents while reducing commute times, energy bills, trips to the hospital, or lost workdays, then overall cost-savings will occur, and social investment will follow.

“We have to talk about this in a broader way or we’re just not going to go anywhere,” Mueller said. “We have the attention of people who could really make some big things happen, but it hasn’t happened yet. As we say in Texas, we’re fixin’ to do it.”


A Way Forward

In Austin and Boston, local players are using focused efforts, creativity, and coordination to make a difference. But these innovative actors cannot close the housing affordability gap using only local strategies and resources.

Building new units, as Austin is doing, is only part of the battle. Making new units affordable to the poorest families requires subsidies; rent income alone will never pay for these properties’ ongoing operating expenses. Even in a county like Suffolk—with its legacy of infrastructure and institutional knowledge, as well as a very supportive philanthropic community and state—the outcomes for extremely low-income families would be dismal without federal support.

Federal housing assistance remains a fundamentally critical element to closing the housing affordability gap. Without that support, the safe, decent, affordable housing that so many Americans dream of will always be out of reach.



The Assisted Housing Initiative is a project of the Urban Institute, made possible by support from Housing Authority Insurance, Inc. (HAI, Inc.), to provide fact-based analysis about public and assisted housing. The Urban Institute is a non-profit, nonpartisan research organization and retains independent and exclusive control over substance and quality of any Assisted Housing Initiative products. The views expressed in this and other Assisted Housing Initiative commentaries are those of the authors and should not be attributed to the Urban Institute or HAI, Inc.


As an organization, the Urban Institute does not take positions on issues. Experts are independent and empowered to share their evidence-based views and recommendations shaped by research.