City of Detroit unveils $203 million ARPA fund affordable housing strategy

The new seven-part plan is expected to provide opportunities for Detroiters to have greater access to higher quality affordable housing. // Image bank

The City of Detroit announced a $203 million Affordable Housing Plan that officials say will take significant steps to address housing insecurity using several new strategies, many of which are funded by the city’s share funds from the American Rescue Plan Act.

The plan was created over several weeks of meetings between Detroit Mayor Mike Duggan; City Council members Mary Waters, Angela Calloway and Latisha Johnson; and Detroit housing staff. It includes seven new initiatives aimed at increasing the quality and accessibility of affordable housing.

The plan will convert long-vacant apartment buildings and land bank homes into affordable rental housing and provide additional housing support resources, mortgage down payment assistance to increase homeownership, a fast placement for high-paying jobs, and more.

The $203 million investment is for 2022 only and is in addition to previously announced affordable housing initiatives and does not include future annual allocations for affordable housing and preservation in Detroit.

“We have worked tirelessly to create and preserve affordable housing in this city for years and prevent the large-scale displacement of residents, as seen in other major cities,” Duggan said. “Despite the progress we made, we needed to do more to meet the need for quality and deeply affordable units.

“This plan represents a true partnership between the City Council, this administration and our community partners to deliver affordable housing to Detroit residents faster while improving the safety and quality of existing rental properties in the city. I believe the plan we have developed is one of the most comprehensive strategies for providing affordable housing in the country.

Here is an overview of the seven elements of the plan:

Detroit Housing Services – $20 million in ARPA funds

A Central Detroit Housing Services Division will be created, providing a range of services to Detroit’s most at-risk and needy residents. This new division will include a network of at least six neighborhood housing service centers operated by nonprofit providers that will serve as one-stop resources to connect current and future Detroit homeowners to a full range of programs, including including housing advice and foreclosure prevention services. .

A new helpline will also offer assistance for those seeking to avoid housing displacement, as well as emergency response for those facing immediate homelessness and connections to additional housing resources.

“The new Housing Services Division will build internal capacity to help residents directly and will also work with our nonprofit partners to put more resources into the hands of more people who need them,” says David Bowser, Associate Director of Housing and Neighborhood Services for the city’s Housing Revitalization Directorate (HRD).

“HRD is dedicated not only to creating and preserving affordable housing, but also to connecting Detroit residents to housing resources, addressing homelessness and housing issues that could lead to homelessness, and ensuring residents are connected to the tools and support programs available to them. ”

Detroit Housing Commission Apartment Building Rehabilitation – $20 Million in DHC Funds

The Detroit Housing Commission (DHC) will use $20 million from the sale of the Brewster-Douglass site to acquire 10 to 12 vacant apartment buildings in city neighborhoods, rehabilitate them, and then lease units at very affordable rates from 30% of the median income of the zone ( AM I).

“We know that many for-profit developers don’t tackle these small 20 or 30 unit buildings, so this initiative will restore these neighborhood eyesores that dot our city into beautiful, very affordable housing,” said Sandra Henriquez, CEO of DHC. .

Detroit Land Bank Affordable Homes Program – $3 million in ARPA funds

This initiative will begin with 20 to 50 homes owned by the Detroit Land Bank Authority (DLBA) that will be sold to local community development organizations (CDOs), which will use city grants to rehabilitate the properties.

The properties will then be leased for at least 10 years at 50% to 60% AMI, rates considered deeply affordable, with the option for the tenant to purchase the property and become a landlord.

“The DLBA is thrilled to partner with the city and CDOs on this creative opportunity to add deeply affordable housing to Detroit neighborhoods,” said DLBA CEO Tammy Daniels. “We know that many Detroit residents need options beyond the small apartments traditionally offered as affordable units, and using Land Bank homes gives families flexibility and room to grow.”

More Affordable Housing and an Accelerated Approval Process – $132 Million in ARPA, State and Federal Funds

Detroit City Council will work with HRD to streamline the council approval process for affordable housing developments that include units for rent at 60% AMI or less. The current process often requires nine or more steps to obtain Board approval. In addition to accelerating the process, the plan includes funding for 1,600 new affordable housing units in at least 30 individual developments, with 250 of the units designated as permanent supportive housing with a range of services available to Detroiters making the transition out of roaming.

Down Payment and Homeowner Assistance Programs – $13 million in ARPA funds

This program will help 600 Detroit residents who are currently renters become homeowners through a down payment assistance program. A third of those helped will receive funding and support to become owners of the homes they currently rent through capital improvements and homeownership advice. The others will receive down payment assistance to purchase homes they are not currently renting.

Programs to bring more than 1,000 rental units into compliance – $5 million in ARPA funds

Through a series of programs, $5 million in funding will be used to bring rental housing into compliance with tenancy codes so Detroit tenants get the quality housing they deserve and the city needs. A

A second-floor rental rehabilitation program will transform vacant second-floor apartments in commercial corridors into affordable housing. Property management and improvement training programs will be offered to small landlords, who can then apply for matching grants to renovate their properties and bring them into compliance with the Rent Registration Ordinance.

Self-sufficiency support for people facing rising rents – $10 million in ARPA funds

With rents rising as demand for housing in the city grows, the city’s Detroit at Work program can help residents by immediately placing them in high-paying jobs or “earning to learn” programs, including programs literacy and GED.

HRD is on track to meet the Duggan administration’s goal of preserving 10,000 existing affordable housing units and developing 2,000 new affordable housing units. Since 2015, more than 6,500 affordable units have been preserved and 1,400 are new construction, the vast majority of them below the 60% AMI deeply affordable rate. Of these units, 96% of affordable preservation projects and 70% of new construction affordable units were at 60% AMI or less.

“Our ultimate goal is to provide housing stability and security for all Detroit residents, from potential homeowners and buyers to renters to our most vulnerable residents, those who are homeless,” said Julie Schneider, Director of HRD.

“In our mission to secure that future for all residents, we must deploy all available tools and launch innovative strategies to increase our supply of affordable housing, reallocate vacant properties, and help residents realize their dreams of home ownership. the property. The $203 million affordable housing plan harnesses public funding and the collective power of partnerships to fulfill this mission.

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