AGENDA #4b
to: Roger L. Stancil, Town Manager
from: J.B. Culpepper, Planning Director
Loryn Clark, Housing and Neighborhood Services Coordinator
subject: Response to Petition from Orange Community Housing and Land Trust
date: March 3, 2008
The purpose of this memorandum is to respond to a petition from Orange Community Housing and Land Trust to modify the guidelines of the Town’s affordable housing programs to: (1) eliminate the first-time homebuyer requirement; and (2) eliminate the requirement that buyers live or work in Chapel Hill for one year (see Attachment 1).
The attached resolution would grant an exception to the Town’s first-time homebuyer requirement for an existing Greenway condominium owner. The resolution also refers this petition to the Council Committee on Affordable Housing for consideration.
On February 11, 2008, the Orange Community Housing and Land Trust submitted a petition to the Council requesting that Council consider eliminating two restrictions to its affordable housing policies: (1) the first-time homebuyer requirement; and (2) the requirement that buyers live or work in Chapel Hill for one year prior to receiving assistance. According to the Land Trust, the proposed modifications would address the immediate need of a Greenway condominium senior citizen homeowner that needs to move to a bottom-floor unit due to health constraints. This buyer would need approximately $10,000 in subsidy from the Town’s Housing Loan Trust Fund to complete this move. The Land Trust believes that the proposed modifications would also assist with the sale of the condominium units that have been approved for Greenbridge, East 54 and Lot 5 that will be available for sale beginning in 2009.
In May, 2007, the Land Trust requested that the Council amend the Affordable Housing Fund guidelines to waive the employment or residency requirement if a home is not sold after being marketed for ninety days. In response, on June 27, 2007, the Council adopted a resolution to modify the guidelines of the Affordable Housing Fund to include that if a home is not sold after it has been actively marketed for ninety days, the home could be sold to a household that has lived or worked in the Town or Orange County for six months. Orange County adopted the same regulation for its Affordable Housing Bond Program.
For many years, it has been the Council’s policy that affordable housing assistance through the Town was for first-time homebuyers that live or work in Chapel Hill or Orange County for one year prior to receiving assistance. These policies were developed in response to concerns that there were not sufficient affordable housing opportunities for people currently living or working in the community who had not been able to purchase homes. Though not a federal requirement and not written into the eligibility requirements of the local Housing Loan Trust Fund, these policies have been applied to all of the Town’s affordable housing programs.
We agree that removing these restrictions could increase the pool of applicants to purchase the over one hundred condominium units that the Land Trust will begin selling in 2009. The issue of removing the first-time homebuyer requirement was raised during the discussions about the Draft Comprehensive Affordable Housing Strategy in December, 2007. It was suggested that people who meet the income requirements and currently live in this community or other areas might be interested in downsizing from their larger homes to a condominium.
We understand that the Land Trust has an immediate need to remove the first-time homebuyer requirement for the owner of a Greenway condominium. Based on the information provided by the Land Trust, we recommend that the Council grant an exception to the first-time homebuyer policy for this particular case. Before eliminating the homebuyer and residency requirements as requested by the Land Trust, we recommend that the Council refer this petition to the Council Committee on Affordable Housing for further discussion.
We recommend that the Council grant an exception to the Town’s first-time homebuyer policy for a Greenway condominium owner to purchase a first floor unit. We also recommend that the Town provide subsidy to the Land Trust from the Housing Loan Trust Fund to reduce the sales price of the unit for this buyer. Finally, we recommend that the Council refer this petition to the Council Committee on Affordable Housing for further discussion.