Detroit partnership aims to preserve affordable housing in the city

Candice Williams
The Detroit News

Detroit — The City of Detroit has formed a partnership with six organizations to preserve affordable housing in the city, improve housing stock and prevent displacement.

The effort announced Monday is called the Preservation Partnership and was launched by the city’s Housing & Revitalization Department. It is part of the city's goal in recent years to preserve 10,000 existing affordable housing units in the city by 2023. It also includes creating new affordable housing.

The effort comes as the city is at risk of losing thousands of properties with expiring low-income housing tax credits at the end of 15-year compliance or renewal periods through 2023.

Detroit Mayor Mike Duggan

Organizations on the Preservation Partnership team are: Enterprise Community Partners; United Community Housing Coalition; a partnership between Cinnaire and CHN Housing Partners; Data Driven Detroit; Elevate Energy; and Community Investment Corp.

Mayor Mike Duggan said Monday that of the 10,000 affordable housing units in the city, 6,000 have yet to renew commitments to remain affordable housing. 

“Rents in the city are continuing to rise which means deals get harder to make every year because the incentives to remove low-income folks get more profitable every year," Duggan said Monday during a press conference announcing the partnership. "...Some of the apartment owners were most able to make the transition and extend already did it. Some of the ones that were more challenged still remain so we sat down, looked at this and said to get the next 6,000 preserved we need some more help.”

The federal government began the low-income housing tax credit program in 1986 to offset dollar-for-dollar a developer’s tax liability. This gives a developer an incentive to provide housing at below-market-rate rents for households that make less than 60% of the area median income. Those households pay 30% of their income.

The credits, available through the Michigan State Housing Development Authority, come with a 15-year compliance period with the option to renew for another 15 years. According to MSHDA, so far no developers with a low-income housing tax credit property have opted out of the extended use period.

According to the city, the Preservation  Partnership team will focus on identifying multi-unit buildings that have no commitments to remain as affordable housing and are at risk of being redeveloped with higher rents or converted to market-rate rents. The team will work to maintain affordable housing through either the renewal of low-income housing tax credits or by coordinating new or restructured financing. Housing renovation will also be part of the mix.

The Preservation Partnership team will cost the city about $1.6 million to run over the next three years and will be funded in part by Neighborhood Stabilization Program dollars, said Donald Rencher, director of the Detroit Housing and Revitalization Department. 

The partnership follows the city’s launch of its Affordable Housing Leverage Fund in 2018 to raise funding for existing units and to create additional housing units. The Preservation Partnership will connect developers with that fund and other available funding resources, Rencher said.

The announcement Monday afternoon took place at Conner Creek Senior Apartments, run by American Community Developers, one of the largest providers of affordable housing in the city. In 2019, ACD took over the east side property and extended its affordability commitment through 2042.

Joan Bell, a resident of Conner Creek Senior Apartments, said it's important for low-income seniors to have a nice, affordable place to live during retirement. Bell, 83, said that after working 40 years for Hudson's department store, her low social Security earnings qualified her for a housing assistance voucher, known as Section 8.

"A lot of people, especially on low income, they need help," Bell said. "A place like this helps people be able to live the quality of your life."

Enterprise Community Partners will lead the team in prioritizing projects. The work will also include addressing the affordable or low-income properties that are in need of repairs or upgrades. 

“The Preservation Partnership underscores the City’s commitment to making sure that all Detroiters have access to not only affordable places to live, but safe and quality ones, too,” Rencher said. “By tackling a number of issues regarding affordability in our city all at once, and by bringing this incredible team together, we will make Detroit a better place for more people to call home.”

Twitter: @CWilliams_DN