Concepts

The Problem

This forum was occasioned by a national and local crisis. Housing is one of those elementary needs to which most of us believe all people are entitled. Our nation's and our city's supply of housing is aging and deteriorating significantly. It is true that we see new housing being constructed all around us at a tremendous rate. However, that new housing, and indeed even the purchase and rental rates for existing housing, are rapidly being priced out of the range of all but a fortunate few.

Census data for 2000 also shows that, for the 29,675 households in Evanston:

• 22.9% of them had income between $25,000 and $50,000
• 13.2% of them had income between $10,000 and $25,000
• 8.5% of them had income of less than $10,000

The US Department of Housing and Urban Development (HUD) creates a standard called "Fair Market Rates" for rentals of existing housing. The current FMRs for Evanston are:

For years, the conventional wisdom on budgeting has been that people ought to pay no more than 30% of their income for housing. HUD, the primary source of supplemental funds for both renters and purchasers, figures the costs of utilities into its assessment of that 30% . Thus a 2-BR apartment priced at FMR (including utilities) would be barely within the "affordable" range for a household with an income of $43,000.

In 2000, more than 25% of Evanstonians were actually spending more than 30% of their income on housing .

All of the concepts and structures to be discussed at this forum represent attempts to resolve the gap between what Evanstonians (present and future) have available to spend and the currently uncontrolled costs of commercially available housing.

Affordable Housing

Much of the discussion at this forum will be about "affordable housing". The term's meaning is set by a bit of reverse logic, several algorithms and census statistics. Housing is determined by HUD to be "affordable" when its cost (including utilities, again) represents no more than 30% of a household's actual income. However, HUD determines annually the Area's Median Income (AMI) levels for various size households and spins off a number of specific limits from those. Evanston's calculations are based on the AMI for the Chicago metropolitan area. The chart on the next pageshows some of the latest HUD numbers.

To make housing affordable for the low/moderate income person/family, a developer or owner (which might be a non-profit organization), must financially package the property so that the end cost is low enough to be "affordable" for at least a portion of the unit owners/renters. This is usually accomplished by using several pots of money which are available for this purpose. Primary sources of funding are federal HOME dollars, CDBG grants administered through the local municipality, state dollars through IHDA (Illinois Housing Development Authority) or another Housing Trust Fund and other public sources available through the local community. In addition, developers can use low-income housing tax credits, municipal zoning incentives, privately donated monies or reduced interest loans from financial institutions. If a developer uses a piece of property within an existing Community Land Trust, that further reduces the cost and assures perpetual affordability. At every level, funds are limited and it requires dedication, patience and creativity to produce a final affordable project.

The above subsidizes the unit cost; Section 8 vouchers (which apply only to rental situations) subsidize the person/family. If an owner agrees to accept a Section 8 family, the family pays no more than 30% of its income for rent and the federal government pays the difference between that amount and the lesser of the contract rent or the FMR. Units must not have higher market rents than the "Fair Market Price" established for the area.

The first step in becoming a community that prizes a diversity of income is to assure that the City of Evanston has a strong public policy which supports, mandates and offers incentives to all those in the housing field. The second step is to devise tools, which will allow affordable housing to be developed or maintained. We hope that this forum will be the beginning of an advocacy movement to tell our city and community leaders that affordable housing is possible if there is a will to make it happen.

Get involved!

We're looking for people who want to get involved in planning for Evanston's affordable housing future.

To find out what you can do, call or write us.