[Durham INC] March Meeting Minutes

[Pat Carstensen]

Please let me know about any additions or corrections.  Thanks, pat



March Delegate Meeting of the InterNeighborhood Council of Durham

Via Zoom

March 23, 2021



Attending the meeting were:

Neighborhoods

Autumn Ridge – Leo Cruz

Bragtown – Constance Wright, Vannessa Evans

Colonial Village – Charles Giamberardino

Cross Counties – Pat Carstensen

Falconbridge – Richard Ford

Forest Hills – Sarah Morris

Long Meadow – Eric Hamilton

Morehead Hill – Rochelle Araujo

Northgate Park – Keith Cochran, Debra Hawkins

Old West Durham – David Eklund

Trappers Creek / Greymoss – Will Wilson, EIleen Sarro

Trinity Park – Philip Azar, Mimi Kessler

Tuscaloosa-Lakewood – Susan Sewell

Watts Hospital Hillandale – Tom Miller


Visitors

Annette Smith -- Durham Parks and Recreation

Yonah Freemark -- Urban Institute, on housing affordability and land use

DeDreana Freeman




President Will Wilson called the meeting to order, and those present introduced themselves.

We are still looking for a Vice-President. Philip Azar moved to approve February minutes, Rochelle Araujo seconded, and the minutes were approved.  We agreed to move the April meeting to April 20th to avoid a conflict with the Planning Commission meeting.


Affordable Housing Discussion -- Yonah Freemar, Senior Research Associate, the Urban Institute, gave an overview of what academics are finding out about affordability and zoning code.  Affordability is defined by HUD as spending less than 30% of income on housing (rent, mortgage, utilities, etc.).  Currently only 35% of the low income households can afford their housing by this measure, because of more poverty, less subsidy, and increasing cost.  Areas are relatively cheap because there is less interest in living there.  Gentrification can happen relatively quickly in places like Walltown because they suddenly become attractive.  Communities with more housing generally have lower costs.  In Durham’s most popular neighborhoods, it is hard to add housing due to zoning codes, making the costs higher.  There are nuances, however.  FIrst, more construction can be related to more demand, becoming self-propelling, so cost of housing in the neighborhood still increases, although the overall cost in the larger community goes down.  We are just starting to get results from studies of the changes in zoning code that allow alternatives to single family homes.  What we are seeing is a small (maybe 10%) increase in the cost to buy a house as the cost of land goes up, at least in the short term.  In theory, in the long-term, more housing and housing choices should give moderate-income families access to the more desirable neighborhoods.  Furthermore, the volume of new housing construction may not meet the demand for housing in Durham, changing zoning doesn’t address income issue and we still do not have tools to address economic disparities caused by racist policies.  The institutional ownership of single-family homes (that is, ownership of rental homes by profit-seeking entities) is another factor.  In concept, if you build more expensive housing, people who can afford more will move there and free up older housing for more moderate-income folks; the process (called “filtering”) is slower than building directly for moderate and low-income households.  However, options for building directly for affordability tends to either mean building at the edges of the urban area (with all the issues of sprawl and infrastructure costs) or having subsidies.  The puzzle with subsidies is how much to spend the limited subsidy amounts we have to create moderately-priced housing (where the limited funds go further) or housing for the lowest-income households (where the need is greatest).  Developers need incentives to build for moderate income households, by for example, getting land from the city.  Downtown became attractive after the city poured resources into it, without realizing how equity would be affected; what would have been better -- and may be appropriate if we wanted to develop other new nodes -- is to somehow reserve opportunities and promote equity so that those who have lived there get more benefit of the growth, not just being displaced.  New duplex apartments tend to rent for significantly more than older ones.  Disinvestment in some communities and expensive housing in others is much too complex to be handled with just zoning policy; some cities are doing better at transformative planning that addresses the weaknesses of the market.  There is a lot of interesting information on the Urban Institute (urban.org) website.  Yonah’s prepared remarks are in Appendix A.


OLD BUSINESS

Autumn Ridge / Willow Hill Rezoning -- Sometime in February, homeowners were notified about proposal to develop 516 units (60% townhomes, 40% single family) on 146 acres, currently heavily wooded and zoned RR,  in North Durham.  The developers have told the group of concerned neighbors that they won’t scale it back as their business plan requires the full size.  There are 3 other developments in the area.  The roads are currently 2-lane and there are a number of creeks that come down from that area, so there are lots of issues.  The developers aren’t offering any solutions, and ideally the PDR will eventually have a bunch of commitments to deal with the issues -- but the neighborhood shouldn’t have to become experts to figure out what commitments to ask for.  Their website is at https://saynotorezone.org.


Committee on equity for cultural and historical non-profits -- As funding has become tighter, the governing bodies have concentrated the limited funds on entities where they have a stake in the buildings.  The city and county have a cultural advisory board, and we could have them speak about the need to a new master plan and re-looking at the funding patterns.  Will will consult with Annette about getting a presentation.


Comp Plan Revision -- Public hearing is April 27th; there is no other business at that Planning Commission meeting.  We can submit our document to the Planning Commission, and should have a couple speakers to hit the highlights.  The committee will get back together to plan.


Bylaws Revision Update -- We have gotten the formal agreement from the Duke Law Clinic to work with us and the committee is making progress.


Development project updates

  *   The Planning Department is re-looking at how they and developers engage the public.  Respond to their survey.  There’s a lot of bad stuff in the omnibus change text for the UDO.

  *   Autumn Ridge/Willow Hill -- discussed earlier

  *   Black Meadow Ridge.-- Board of Adjustment has an item on its agenda about this.


INC Vice President needed -- Will’s family will be moving out of his neighborhood, which may mean he can’t continue as President.  In any case, we need a vice president so someone needs to step up.


There was nothing to report from the Communications and Internet Committee.


Treasurer’s report -- Nine neighborhoods have paid dues.  Susan paid the Post Office box bill.  That leaves $5501.39 in the bank.


Neighborhood Reports

  *   Northgate Park is starting its season of food-truck pop-up events each month, plus there is one on April 6th and for CInco de M

  *   John Schelp is doing a virtual history tour in March.

  *   The planned Golden Belt parking structure needs some “adjustments.”


Adjourn.



Appendix: Speech for InterNeighborhood Council of Durham

Yonah Freemark

March 23 2021



Thank you for the opportunity to talk with you all tonight.



As some of you know, I’m originally from Durham and as a result I jumped at the opportunity to be able to discuss matters related to affordable housing – an issue that is near and dear to my heart, and also my professional background now that I am a researcher and head of the Fair Housing Practice Area in the Metropolitan Housing and Communities Policy Center at the Urban Institute in Washington.



David Eklund and Will Wilson asked me to speak about issues related to zoning policy, housing supply, and the affordability of market-rate housing, and I am under the impression that some of you may have seen some academic research that I conducted on the subject in recent years.



So I’ll try my best to give a concise overview of this issue as a whole over 15 minutes or so—then we can open it up for questions and a conversation if that is useful.



What do we mean by housing affordability? Let’s start with that.



The U.S. Department of Housing and Urban Development defines affordability as paying less than 30 percent of your income for housing—either rent or, if you’re an owner, for your mortgage and property taxes. About half of Durham households rent and the other half own their homes.



Affordability has been worsening in Durham—there is no question about that. And the situation has been particularly troubling for very low-income families—those who earn less than about $25,000 a year. There are about 14,000 families in Durham—that’s about one-tenth of the county—who earn that little.



Unfortunately, only about 35% of those families are able to afford the homes they live in, either because of public subsidies or just cheap market-rate units. That is a much worse situation than in 2000, when 50% of very poor families could afford the housing they lived in.



Now, communities like Durham are hardly alone in experiencing this problem of housing affordability, because it has a number of sources: Too few federal housing supports, inadequate supply of new housing units, and increases in poverty are chief among them.



The fact that communities like Durham are highly segregated by race and by class makes matters worse. You have certain communities with what people often describe as higher quality schools, better public services, and less crime, and those are the communities that are both expensive and that have the most demand to live in them. On the other hand, you have communities that are relatively cheap—but because of other conditions in the city—like schools, services, and crime—there is less interest in living there.



You also get situations where certain communities—like Walltown, perhaps—suddenly become popular and gentrify quickly, replacing a largely low-income Black population with a wealthier, whiter one. These types of changes provide upwardly mobile families the ability to invest in what appears to be an affordable home to them, but in the process, lower-income, typically minority households are left unable to pay.



So what can we do about this? Many cities across the U.S. have been focusing on altering their zoning codes to address this problem. I know that Durham’s planning department, too, has been discussing zoning changes as a mechanism to induce more affordability.



The concept behind zoning changes has a number of premises. For one, many zoning codes throughout the country were originally enacted to enforce strict racial and class segregation. As a result, you had communities that were strictly defined as only open to the construction of single-family homes, for example, which is the reason why, in most of Durham, you see block after block after block of single-family homes alone, with no apartments of any size in between.



Some argue now that we must change the zoning code in order to ensure that we rid our communities of this stain of racist policymaking.



Others point out that, on average, communities with more housing units available generally have more affordable housing. The idea is this: When there is a greater supply of housing, if there is demand for that housing, the prices go down overall. This is one reason why, for example, the Houston metropolitan area is cheaper than other places: It is simply easier to build more housing there, and as a result, more people are able to buy into housing at a reasonable cost.



To the contrary, in some of Durham’s most popular neighborhoods, the fact that little new housing can be built—the fact that only single-family homes are allowed—means that many of those communities steadily become more and more expensive as demand creeps up and supply doesn’t follow.



Now, this doesn’t mean that new housing specifically is less expensive, but the theory is that, if you allow more housing to be built, eventually housing will quote-on-quote filter down to moderate- and low-income families, making it possible for them to afford units that were previously unaffordable.



As a result, proponents of zoning change suggest several possibilities, mostly related to encouraging more neighborhood housing production. The idea is that, if you allow developers to build apartments in now single-family-only neighborhoods, or if you allow homeowners to build what are called accessory dwelling units, you’ll eventually end up with more housing available and thus, the demand will be met by supply. The end result will be more affordability.



This basic economic principal of supply meeting demand is not something that can be contested: If there are more homes available in a community, controlling for the demand for homes, the average home will be cheaper. There is little question about that.



There are a few elements of this conversation, however, that require more nuanced analysis. The first is that, just because you allow more homes to be built in a certain neighborhood does not mean that that neighborhood, in and of itself, will become cheaper. The reason for this is that more construction can be associated with more demand to live in a certain neighborhood.



An example of how this might work would be downtown, where, despite thousands of new housing units over the past two decades, more people want to live downtown—there’s a bit of a self-propelling effect there. As a result, downtown homes are more expensive now than they were when I was growing up.



But to say that this indicates a failure in the principal of demand and supply would be wrong—it’s just that we have to take into account considerations of scale. Even if downtown becomes more expensive with new construction, overall in the county, housing will become less expensive. This is because more interest in living downtown means less interest in living in places like American Village or Forest Hills, or what have you.



The second issue we need to examine is what happens when you execute a zoning change. It turns out that this is the focus of much of my research, which hinges on using what are called econometric methods to examine how policy change results in changes in the housing market.



The truth is that we are at the beginning of research on the impacts of zoning change. What we know so far—partly informed by my own research in Chicago, but also by new research in places as far-flung as Minneapolis and New Zealand—is that the immediate impact of zoning changes that allow more housing construction is actually higher housing costs.



Now, the reason for these higher housing costs isn’t too hard to identify: When you allow a land owner to build more on a plot of land, that land becomes more valuable.



This raises some concerns. Does this mean housing becomes less affordable for the people in certain communities? Well, the answer is, we’re not entirely sure. We do know that, in the period following a zoning change that allows more construction, the cost of housing for homebuyers goes up. It goes up a bit—we’re talking maybe a 10 percent change, once you account for other variables at play.



We don’t really know if the increases in costs of land get translated into higher rents.



But the increased value does suggest that what will eventually happen is more housing will be built. Some of my colleagues at the Urban Institute showed that a careful reform of the zoning code there to allow for the construction of backyard cottages resulted in a massive increase in their construction. This suggests that, over time, zoning changes that allow more housing to be built will, actually, result in more housing construction. And more housing construction should mean, eventually, cheaper housing on average.



In theory, the wider availability of more types of housing in more neighborhoods should mean, eventually, the creation of more equitable, integrated communities. The ability of a moderate-income person residing in an apartment to live adjacent to an upper-middle-class family residing in a single-family home should give them access to many of the neighborhood amenities that the upper-middle-class family is able to take advantage of.



But the speed at which these changes occur is not yet clear. So zoning changes of this sort cannot be the only way that cities like Durham push for greater housing affordability.



Indeed, the reality is that no single policy will come close to resolving the sorts of housing affordability problems that communities like Durham face. It is true that new housing supply is likely to be associated with less housing costs over the long-term, on average, but costs are more likely to reflect overwhelming and rising demand to live in Durham—a problem that cannot be easily solved by the volume of new housing construction that we’re talking about here.



Moreover, no market-rate housing is ever going to be able to meet the affordability demands of the lowest-income members of our community. Those households will continue to need significant subsidies—whether through the federal, state, or local governments—in order to address the fact that they simply do not have access to the income necessary to afford comfortable, convenient homes at all.



Finally, we still don’t have the tools to deal with the vast patterns of economic and racial segregation that define our communities. These patterns make their way into the housing market, perpetrating perceptions of neighborhood quality, reducing the wealth of low-income people of color, even as they allow higher-income, largely white families to build wealth.



No zoning change is going to be particularly effective at reducing disparities between neighborhoods, especially for those communities that have faced systemic disinvestment over the decades.



Thanks – and I look forward to our discussion!






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