Montgomery County should take strong steps to expand the availability of affordable housing, MHP’s Chris Gillis told the County Council at a Feb. 6 hearing on the fiscal 2021 capital budget.
“MHP’s top priority in the County Executive’s proposed capital budget is additional funding to support the acquisition, development, and renovation of affordable housing, and to grow the Housing Initiative Fund (HIF) to $100 million annually by 2022,” said Gillis, MHP’s director of policy and neighborhood development.
He noted the Urban Institute estimated that Montgomery County needs to create an additional 20,000 units of housing for households with incomes of $55,000 or less by 2030 to meet residents’ needs. This would require producing about 2,000 units a year for low- to moderate-income households. But at current funding levels, the county is only producing about 600 units a year, making it likely the need will not be fully addressed.
Gillis praised the County Executive’s proposal to create a new Affordable Housing Opportunity Fund. The fund would be capitalized with $10 million in county dollars for each of the next two years with the intention of leveraging additional private capital to make $40 to $50 million available to loan to developers. But he urged
caution in how funding is structured and priorities are set.
“All affordable housing projects in Montgomery County require some level of gap financing and we worry that if the HIF doesn’t increase by a commensurate amount or more, it will create a serious bottleneck on the trust fund. It potentially sets up a scenario where the lion’s share of the HIF is being used to support preservation to the detriment of new production, which is no less important.”
Gillis added, “We recommend that the Council increase funding for the HIF by $10 million in FY21. These additional resources will ensure that we don’t repeat past mistakes and put us on the path of getting to $100 million by the end of 2022.”
Read his full statement here.