Category: Resources

Testimony before the Hon. Muriel Bowser, Chair, Committee on Economic Development and Housing Council of the District of Columbia regarding: DHCD Performance Oversight – Inclusionary Zoning

Posted on by Ted Van Houten

Please accept these comments on behalf of the Coalition for Smarter Growth. We are a regional organization based in the District of Columbia focused on ensuring transportation and development
decisions are made with genuine community involvement and accommodate growth while revitalizing communities, providing more housing and travel choices, and conserving our natural and historic areas.

We would like to comment on DHCD’s administration of the Inclusionary Zoning program. We have been involved with Inclusionary Zoning (IZ) since its beginning in 2003 and remain committed to ensuring that this important affordable housing program delivers on its promise. We are gratified that IZ is finally becoming a reality on the ground given the delays in issuing regulations, the housing market collapse, and extensive grandfathering. The start up of this program has faced many serious challenges, but we believe all these challenges can be overcome. We first want to remind the Committee of the importance of this affordable housing tool that produces below market rate units in matter of right developments throughout the city with no cash subsidy from the District. Of unique importance, IZ creates below market rate units in neighborhoods where few or no affordable units are likely to be produced in the future. This is a valuable affordable housing tool practiced by hundreds of jurisdictions throughout the country, including Montgomery County. This approach is credited with achieving economic integration is ways that other affordable housing programs are unable to achieve.

Montgomery County’s experience is instructive for looking at D.C.’s pathway to successful implementation. The county has produced over 13,000 IZ units since 1976. Due to short affordability terms, currently only 2,600 units are still affordable at 65 percent area median income (AMI). In addition, another 1,573 IZ units that were purchased by the county’s housing authority are rented to lower income families (this is through a provision in the county’s law that D.C.’s prohibits). The county’s IZ program provides nearly half of its affordable housing production. Among the changes the county has made to its program over the years are: extending the affordability term to 30 years for ownership and 99 years for rental; allowing income targeting to rise from 65 percent AMI to 70 percent AMI for high rise construction, and elimination of a troubled buy-out provision that allowed fees in lieu of on-site construction of units.

Administration of D.C.’s IZ program requires urgent and specific attention to ensure that as the over 900 units come online in the next 5 years, implementation will be smooth for all parties. We now face three key administrative challenges that can be fixed: severe understaffing, FHA rules, and overly rigid administrative regulations. Below are our recommendations for these key challenges.

Administrative problems that must be resolved immediately

1. Severe understaffing –1-2 overworked staff members are struggling to launch a new IZ program and provide oversight for roughly 2,000 affordable dwelling units (ADUs) already built or in process, created by PUDs (in lieu of IZ) and public land dispositions. Staff will be difficult to retain and attract if capacity is way below a realistic workload. Program applicants and developers will also not get the assistance they require.

Recommendation: Budget more staff and contract to a qualified homeownership organization
experienced in permanent affordability:

a. Add 2 additional staff positions;
b. Contract with a nonprofit group experienced in managing the homeownership purchase process and stewarding permanently affordable homes. Given the extra challenges of affordable home purchasing in a post-2008 economy, more assistance to homebuyers is needed to speed up the sales process. A nonprofit experienced in selling and stewarding permanently affordable homes could manage the homebuyer recruitment, preparation, qualification, selection and placement process. This nonprofit can also provide effective relationships with mortgage lenders and developers to secure financing, along with ongoing stewardship, enforcement, and resale assistance. This kind of close working relationship with buyers and owners is likely going to be more effectively created through a nonprofit dedicated to successful affordable homeownership and permanent affordability than a government agency;
c. Sustain housing counseling assistance for IZ applicants.

2. FHA conflict with local covenants regarding foreclosure – The Zoning Commission has revised the regulations to conform with FHA rules, and DHCD is working to get FHA’s final approval. After FHA clarifies its acceptance of the D.C. program, DHCD needs to educate mortgage lenders and recruit them to offer mortgages for IZ units. Bank of America, for example, reviews and approves IZ programs for their mortgage lending. DHCD should ensure that D.C.’s IZ program gets onto Bank of America approved list, along other lenders’ lists.

3. Rigid regulations – The administrative regulations are currently being revised but it is urgent that we expedite these revisions given the many barriers they place to an efficient matching process for applicants and units. Given the difficulty matching qualified and interested applicants to units, we suggest suspending overly prescriptive lottery requirements until a lottery is needed to fairly allocate a unit among a larger pool of qualified applicants.

Policy issues for future consideration

Beyond the immediate administrative issues that should be our top priority, longer term policy issues should be considered to fine tune the program. The robust recovery of the housing market in D.C. over the last few years demonstrates that IZ is not a deterrent to housing production. For example, over 4,500 housing unit permits were issued in 2011. This is 64 percent greater than the last peak in the market in 2005 when over 2,750 permits for housing units were issued. D.C. housing production has gone from a few percent to more than half of the region’s residential output.

The experience to date on the development review and financing phase of IZ is that the economics work. Over 900 IZ units are in the pipeline at various stages of development approvals, and construction, with a handful of completed projects. This development pipeline demonstrates that financing for projects subject to IZ is not a problem. IZ policy standards have also contributed to creating approximately 1,000 affordable dwelling units (ADUs) through PUDs since the mid-2000s.

We flag the following policy issues for further assessment, as we act immediately to fix the administrative problems discussed above.

1. Income targeting: Current income targeting is at 80 and 50 percent AMI. Given that market conditions have changed since 2006, is income targeting still at the right levels? How many 50 percent AMI units can we expect to produce? How effective is the 80 percent AMI income targeting in providing units sufficiently below market?

2. Condo fees – while IZ standards have avoided the problems that early ADUs experienced before IZ policies were developed, unpredictable rises in condo fees could pose a problem in the future.

Recommendations:

a. Require par value assessments for condo fees for IZ and ADUs: Rising condo fees over time are potentially a problem even though IZ incorporates an initial fee based on what is projected to be a realistic fee to ensure that the overall housing payment by the buyer does not exceed a certain percent of her or his income. To avoid future excessive increases in condo fees, we suggest requiring that at least for IZ units and ADUs, par value tied to the affordable price of the unit be the basis for assessing the condo fee rather than a square footage basis. This will allow condo fees to rise as inflation and costs rise without subjecting the owner to a rapid escalation that would make the condo fee too expensive for the affordable unit owner.
b. Initial fee setting: This is already addressed by IZ regulations but could affect a building as a whole if a developer sets fees too low to support ongoing building costs. Given this problem for all condo owners, we recommend strengthening consumer protection against lowballing condo fees. Enabling OP and DHCD to comprehensively collect data on condo fee rates from existing buildings would provide these agencies the information they need to appropriately set condo fee rates as a part of the purchase price of an IZ unit or ADU. Secondly, consumer protection for condo purchasers can be improved by changing how the verification of the initial condo fee is set. Currently a certified third party is paid by the developer to verify the fee. We suggest charging the developer a fee that would have been paid to the third party, and have the city contract with a third party directly to verify the condo fee.

Overall, IZ is a sound policy that requires focused attention to address the administrative hurdles to a smooth-running program. The program promises to provide a substantial new source of below market rate housing throughout the city. While the program faces challenges, it is worth the effort. We thank the D.C. Council for its long-standing support for this innovative affordable housing policy.

Thank you for the opportunity to testify.

Cheryl Cort

Policy Director

The Smart (Growth) Crowd Weighs In

Posted on by Ted Van Houten

My smart growth buddies have issued a critique of the compromise transportation-funding deal. Among the highlights in the press release issued jointly today by the Coalition for Smarter Growth and the Piedmont Environmental Council:

Cutting gas taxes by up to one-third reduces the tie between transportation use and funding. “Transportation, unlike our schools, is like an electric utility, yet the primary fee—the gas tax—hasn’t been increased in 27 years. Transit users have been paying increased fares, year after year, yet road users would see a reduction in daily travel costs under the bill, leading to a potential shift from transit to driving, more driving and more congestion.”

The proposal feeds wasteful spending.  “The Virginia Department of Transportation (VDOT) is squandering most of the $3 billion in borrowed funds authorized by the General Assembly in 2011 and we can expect more of the same.” Hard-to-justify projects include the Charlottesville Bypass, the Coalfields Expressway and the Route 460 Connector. Another $1.25 billion in funds raised by the tax restructuring will be lavished upon a Northern Virginia Outer Beltway.

The proposal offers no statewide funding for local road needs.  “VDOT has zeroed out funding for local roads over the past few years. Instead, the bill will make Northern Virginia and Hampton Roads increase sales taxes and wholesale gas taxes to pay for local roads. This is a major step toward devolution and passing on the cost of local roads to Northern Virginia and Hampton Roads.”

The compromise pushes all new transit funding — the 0.3 cent addition to the sales tax — into the General Fund, forcing it to compete with schools, health care and other public services.  “Dulles Rail should long ago have been funded through the Transportation Trust Fund. It should not be a bargaining chip to get Northern Virginians to agree to taking General Fund revenues.”

Bacon’s bottom line: I agree with most of this critique — the General Assembly compromise enables a dysfunctional Business As Usual. I do take exception with one point, however. I believe that all modes of transportation should stand on their own two feet, so to speak. I don’t believe in subsidizing rail or mass transit any more than I believe in subsidizing roads. We need to create a level playing field — put each mode on a user-fee basis — and let the most economical mode win.

Would it then be impossible to finance new rail projects? Not necessarily. We could make rail more viable if we could figure out how to tap a portion of the real estate value created by rail projects to help finance the construction. That’s where we need to concentrate our energy, not how to stick non-users with the bill.

Photo courtesy of Bacon’s Rebellion

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New bus rapid transit proposal centers around Route 355

Posted on by Ted Van Houten

Route 355 is the only road in Montgomery County that could support a two-way bus lane, county planners said Thursday as they presented a scaled-back bus rapid system to the county’s Planning Board.

Planners are pitching a 78-mile system that would include eight corridors in the center and downcounty regions. Some would include new lanes in the current medians, one of which is a two-lane system and others that call for a one-lane track, and mixing the buses in with existing traffic.

The new version is about half of the 160-mile system proposed by a task force appointed by County Executive Ike Leggett. A report from the New York-based Institution for Transportation and Development Policy suggested that system would not have enough riders.

The buses in the new system would run down Route 355, Colesville Road/Route 29, Georgia Avenue, New Hampshire Avenue, Randolph Road, Veirs Mill Road, University Boulevard and the proposed North Bethesda Transitway between Old Georgetown Road and Interstate 270.

But Route 355 is the only road that could hold two lanes down the median and provide enough bus riders to make the new construction worth it.

Master Planner Larry Cole pitched building the bus system on Route 355/Rockville Pike and U.S. 29/Colesville Road first because these are the roads predicted to have the most riders and they can stand alone without other corridors feeding into them.

Some commissioners questioned why some corridors were chosen over others and what the methodology was behind determining ridership and congestion. There was also discussion of what was more beneficial for drivers and potential BRT riders: dedicated curb lanes or bus lanes in medians?

Planning commissioner Norman Dreyfuss asked whether Cole had considered creating new median lanes for cars instead of the buses to alleviate congestion on certain corridors and keep buses on the curb for pedestrian safety.

Cole said county staff was still working on the specifics of the system.

Area transportation advocates backed the plan, saying county planners are being realistic about the service they can provide the county.

“The staff’s analysis is both rigorous and practical,” said Stewart Schwartz, executive director of the Coalition for Smarter Growth. “And results in a network that can be effectively implemented.”

A public hearing is scheduled for March 18.

Photo courtesy of Washington Examiner

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Planners Say Rockville Pike Could Handle Major Bus Rapid Transit System

Posted on by Ted Van Houten

Montgomery County planners think Rockville Pike is the county’s best candidate for a “true” Bus Rapid Transit route, meaning the traffic-clogged artery could support a two-lane median busway similar to major systems that serve millions of riders in other countries.

The finding came today in a briefing from planners in front of the Montgomery County Planning Board and a little more than a week after it was revealed that an outside consultant found a potential 150-mile BRT system in Montgomery County would not have enough riders.

Today, planners presented a modified 87-mile BRT system they said would attract more riders than the outside report from the New York-based Institution for Transportation and Development Policy suggested.

“ITDP’s report’s focus is on which corridors are best suited to high-quality “true” BRT with frequent all day service. The report finds that MD355 is the best candidate for this treatment, but expresses a concern that if future BRT ridership is only double the existing bus ridership, it would be very low compared to other BRT operations nationwide,” reads the Planning Staff’s memo. “ITDP did not do any ridership forecasting however, whereas our transportation modeling work has shown that the forecast 2040 ridership on MD355 is far higher and we are confident that we should begin planning for a two-lane median busway for most of this corridor.”

The Planning Staff briefing also found that the proposed North Bethesda Transitway BRT route (with a previously estimated daily ridership of 8,000 to 10,000 riders) was a corridor that could stand alone, without the benefit of a county-wide network.

The Coalition for Smarter Growth, a D.C.-based nonprofit lobbying for smart growth initiatives and transit funding, had supportive words for the latest proposal.

“The planning staff’s network is smaller than the full Transit Task Force proposal but also much larger than the Institute for Transportation and Development Policy (ITDP) proposal.  The staff’s analysis is both rigorous and practical, and results in a network that can be effectively implemented,” Coalition for Smarter Growth Stewart Schwartz said in a statement.

Daily ridership projections by 2040 presented at a Coalition for Smarter Growth meeting last week show between 44,000 and 49,000 riders for a southbound MD 355 system and between 22,000 and 34,000 riders for a northbound MD 355 system. The projections for the North Bethesda Transitway range from 4,000 daily riders to 10,000.

Photo by Juanman 3 via Wikipedia; route map via Montgomery County Planning Department

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Why the Transportation Bill is Bad Public Policy and a Bad Deal for Virginia

Posted on by acustis

VIRGINIA – “Look beyond the deal specifics and look at the real implications of the announced deal on HB2313, and you’ll see a bill that represents bad fiscal policy and bad transportation policy,” said Stewart Schwartz, Executive Director of the Coalition for Smarter Growth. “It’s a bad deal for Virginia. Without reforming VDOT spending the statewide component of the funding will be wasted, and all Virginians will have to pay for this waste. On the same day that the conference committee announced a deal proposing about $850 million per year in additional transportation funding, we learned that VDOT is wasting yet more of the $3 billion in funds approved by the General Assembly in 2011,” said Chris Miller, President of the Piedmont Environmental Council. “Yesterday, in a presentation to the Commonwealth Transportation Board, VDOT said it would allocate $869 million in borrowed federal funds to Route 460 and the Coalfields Expressway, two of the most wasteful projects to ever be proposed in Virginia. Then there is the $1.25 billion or so they propose to waste on the Charlottesville Bypass and the NoVA Outer Beltway. ”

Montgomery Planners Propose 78-Mile Rapid Transit system

Posted on by acustis

Today, Montgomery County planning staff present to the Planning Board a 78-mile version of the proposed Rapid Transit System, based on several months of data-driven modeling and analysis. The Rapid Transit System would be a premium, reliable transit service using dedicated lanes as much as possible to bypass traffic, running frequently throughout the day, and stopping at enhanced stations featuring real time arrival information and efficient boarding like that found on Metro.

Advocates Form Coalition To Push For Purple Line Funds

Posted on by Ted Van Houten

A new coalition is advocating for dollars for state transportation projects, including the planned 16-mile Purple Line light rail that would connect Bethesda with New Carrollton, The Washington Post reports.

Get Maryland Moving, a coalition of groups, including the Montgomery County and Bethesda-Chevy Chase chambers of commerce, Purple Line Now, Action Committee for Transit, and the League of Women Voters of Maryland, is pushing for state legislators to make new revenue for transportation projects a top priority this legislative session, according to the group’s website.

Maryland Senate President Thomas V. Mike Miller Jr. (D-Dist. 27) of Chesapeake Beach has proposed a 3-cent gas tax that would raise about $300 million for transportation projects, Patch reported.

But without a tax increase to fund the Purple Line, the project—along with Baltimore’s Red Line and the Corridor Cities Transitway through the Interstate 270 corridor—could be put on hold, Maryland transportation officials have said. Montgomery County officials and transportation advocates have argued that deferring the funds in the state’s transportation funding plan could stall the projects and make them less competitive for federal dollars.

Get Maryland Moving is encouraging Maryland residents to contact their legislators and sign a petition supporting transportation funding. The petition reads:

“No funding solution this year means that critical capital projects such as the Purple Line, Red Line, and MARC upgrades may be delayed for years or decades. We call on our leaders to take a different path: to invest in our future by securing funding for critical transit projects, road maintenance, and other investments to support smart, sustainable growth for Maryland.”

Photo courtesy of MTA

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Group Introduces New Coalition To Push Transit Funding

Posted on by Ted Van Houten

A new collection of transit advocates yesterday began a push to get Annapolis lawmakers focused on transportation funding and a member of the group fueling the effort yesterday night asked for support from a Bethesda Advisory Board.

Kelly Blynn, of the D.C.-based nonprofit Coalition for Smarter Growth, told members of the Western Montgomery County Citizens Advisory Board that without transit projects such as the Purple Line light rail in Bethesda or a Bus Rapid Transit system along Rockville Pike, Montgomery County could not handle the over 200,000 more people coming to the county by 2030.

The Coalition for Smarter Growth spearheaded the “Get Maryland Moving” campaign, which it introduced on Tuesday.

“Maryland’s economic competitiveness is at risk if the state fails to invest adequately in maintenance, local roads and modern transit systems,” Coalition for Smarter Growth executive director Stewart Schwartz said in a statement. “These transit investments are essential for providing relief from peak hour congestion, for supporting economic development, and for reducing air pollution and greenhouse gas emissions.”

Blynn came looking for allies at the Advisory Board meeting on Tuesday and described the group’s three-legged approach toward improving local traffic issues: investment in the projected $2.4 billion Purple Line, Bus Rapid Transit (still far from its final design) and Metro system improvements.

Supporters of the “Get Maryland Moving” campaign include the Greater Bethesda-Chevy Chase Chamber of Commerce, Action Committee for Transit and and Purple Line Now.

With no state funding in sight, Purple Line design work by the Maryland Transit Administration could be stopped, which local lawmakers say would derail the process. The 16-mile light rail from New Carrollton to Bethesda, with stops in College Park, Silver Spring and Chevy Chase, among others, would bring 15,000 riders a day to the Bethesda station, according to MTA projections.

County leaders say this is the year to get a gas tax hike in the General Assembly that could cover the state’s share of the cost. They are pessimistic that leaders would agree to a gas tax hike in 2014, an election year. So far, Gov. Martin O’Malley (D) hasn’t made achieving transportation funding a priority, to the chagrin of Montgomery leaders such as Councilman Roger Berliner (D-Bethesda-Potomac).

The “Get Maryland Moving” campaign includes a petition to spur action from O’Malley and others on the issue.

Photo courtesy of Get Maryland Moving

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NCRTPB votes to consider new access roads for Dulles airport

Posted on by Ted Van Houten

The National Capital Region Transportation Planning Board voted unanimously Wednesday to approve studying multiple proposals for new access roads on the west side of Dulles International Airport.


Dulles International Airport. Photo: Wikimedia Commons/Joe Ravi CC-BY-SA-30

As a critical hub for trade and commerce, Dulles needs more access roads for cargo trucks, planners say.

Advocates argue that more access roads could mean more cargo trucks, which could mean more trade in an international economy.

“If we don’t improve access to it and the other airports, we’re going to find our economic growth declining,” says Leo Schefer, Washington Airports Task Force president.

But not everyone is in agreement. Opponents point to the price tag, potentially hundreds of millions of dollars.

“At a time when we’re starved for transportation dollars, why are we diverting so much money to these roads on the backside of the airport instead of fixing 66, finishing paying for Dulles rail, revitalizing Route 1 in Fairfax, just dozens and dozens of projects that have not been funded,” says Stewart Schwartz, Coalition for Smarter Growth executive director.

In the hundreds of public comments, residents who oppose the proposed access roads call this a foot in the door toward the creation of what they call an “outer beltway.”

But board chair and Loudoun County Supervisor Scott York says that is not the plan.

“I hope all would understand that this is about supporting the growth of the international airport,” York says.

“The real goal is additional road investment on the backside of the airport to open up the rural areas of Loudoun County and Prince William County to more development,” Schwartz says. “Which is gonna mean more traffic upstream as well.”

Today’s vote means transportation planners will study several alternatives, including the two new access roads or possibly doing nothing at all.

VDOT will then select a preferred alternative before the board votes in July on its long-range transportation plan.

Photo courtesy of Wikimedia Commons/Joe Ravi CC-BY-SA-30

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New group pushing for Maryland transportation funding

Posted on by Ted Van Houten

Transit advocates from the Washington and Baltimore regions have formed a new group to push for additional state transportation funding, including money to build a light rail Purple Line between Montgomery and Prince George’s counties.

The group, called Get Maryland Moving, is asking the Maryland General Assembly and Maryland Gov. Martin O’Malley (D) to make new revenue for transportation projects a top priority for this legislative session. The group includes Purple Line Now, the Red Line Now PAC in Baltimore, the Maryland League of Women Voters, state environmental groups, and the Greater Bethesda-Chevy Chase Chamber of commerce.

A 16-mile Purple Line would connect Bethesda and New Carrollton, with 21 stations in between. A 14-mile light rail Red Line would connect western Baltimore County with eastern parts of the city.

Maryland transportation officials recently revealed that they would cut off state funding for more detailed design of both transit projects after June 30, unless the General Assembly passes some kind of tax increase to fund new road and transit construction. Transit advocates say they worry the projects could stall for years and jeopardize the state’s quest for highly competitive federal transit construction aid.

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