Sixty-seven households struggling to afford a home could soon receive relief as new housing is built, purchased or rehabilitated after the Spokane City Council approved spending an additional $9 million to support 10 construction projects.
The nine projects, valued at a total of $42 million, range from the construction of a 35-unit affordable housing development for seniors to the acquisition of a four-family home to house seniors or people at risk of homelessness. In total, the projects are expected to create or rehabilitate up to 149 housing units.
With the exception of a project to rehabilitate a 17-unit housing complex for the chronically mentally ill, the city is not fully funding any of the projects, but is paying between 9% and 82% of the project costs. Additional funding to support the projects is expected to come from a variety of sources, including additional state, federal and local grants, as well as from the developers themselves.
More than $5.8 million of the city’s funds come from its affordable housing fund, often referred to as the 1590 fund in reference to the state law that allowed cities to increase sales taxes by 0.1 percent to support affordable housing. That fund, which brings in about $6 million annually, has previously supported five other projects that have built or rehabilitated a total of 204 housing units, according to city spokeswoman Erin Hut.
The remaining funds provided by the city come from a federal grant from the U.S. Department of Housing and Urban Development.
The city expects its support will help create 67 housing units, costing an average of about $135,000 per unit. Some projects will cost the city significantly more to create affordable housing than others, such as a $468,000 project to build a three-bedroom, three-bathroom single-family home in the Grandview/Thorpe neighborhood that will be available to an individual or family earning 60 percent or less of the area median income, which is $41,100 for a single-person household or $58,200 for a family of four, for example. The city will provide $327,000 in HUD grants for this project.
“I was a little shocked that we financed a single-family home for just over $400,000,” City Councilor Michael Cathcart said in an interview Monday.
Another $10.2 million project to build a new four-story, 85-unit apartment building will receive about $926,000 from the city’s affordable housing fund. A presentation to the City Council claimed that the city funds will help create 36 to 43 affordable housing units at a cost of about $23,000 per unit.
Thirty of the units, partly financed by the city, are not new housing but the renovation of existing buildings.
Funding was approved by a 5-1 vote, with Cathcart voting against. He argued that city staff had not followed city regulations when looking for projects to fund, citing a lack of focus on mixed-use projects that could have included ground-floor retail, for example, or projects that would lead to homeownership.
“This is important because (through home ownership) we create intergenerational wealth,” Cathcart said. “We have to be smart about how we build, the efficiency and the cost per unit. If we get all of this right, we can contribute to intergenerational financial stability rather than just providing one-time financial support.”
A project funded through the city’s affordable housing fund aims to provide single-family homes for families earning less than 60% of the area median income. The city provided $1 million for a nearly $3.3 million project that will purchase and rehabilitate seven homes that will later be sold to eligible households.
The city has another first-time home buyer assistance program that covers up to 25% of the down payment, which has helped 19 families or individuals purchase their first home. But that program was funded by expiring federal pandemic relief funds, so the city’s affordable housing fund is currently the only pot of money remaining to encourage homeownership for lower-income residents, Cathcart said.
