Florida affordable housing funds likely to get shifted

Florida’s 25-year-old solution to affordable housing — funding down-payment assistance and subsidized rentals with real estate taxes — operates with half the money it had a decade ago, even as Floridians are further stretched to pay the rent.

When the housing market peaked in 2006, 95 percent of the real estate sales taxes designated for affordable housing were spent as directed by a 1992 state act. But that share has dropped to 67 percent, according to the Florida Housing Coalition — and the program’s revenues have dwindled by more half during the last 10 years, from $433 million to $200 million.

Now, for the 10th year in a row, the Legislature plans to spend only a portion of its pot of affordable-housing dollars on affordable housing.

Jaimie Ross, president of the Florida Housing Coalition, said Florida’s “homegrown” way to entice investors to build and rehab affordable housing depends on the state sticking to the requirements of what’s known as the Sadowski Act.

Meanwhile, state leaders, including state House Speaker Richard Corcoran, say the fund has become too large and serves not just those residents with no housing options, but also people who work and are seeking better accommodations than they can afford on their own.

As federal tax reform looms, Floridians need the funds more than ever to pay for housing needs that might go unmet as the world of affordable-housing financing changes, she added.

Any of the trust fund dollars not spent on helping house needy Floridians usually goes into the general fund to pay for a wide variety of state programs and operational costs.

The fight for affordable-housing dollars is particularly tough this year because legislators are asking for a smaller share of those dollars than in recent years. In the past, the Senate has asked for full funding, but this year, they requested just over half of about $300 million of those funds as they seek sources to pay for state programs and operations in the general fund.

Lake Mary resident Jacqueline James, 55, earns $13 an hour in the medical profession and says she will no longer be able to afford her aging apartment as the monthly rent rises above $800 in coming months. She said she has looked for subsidized rentals, but her income disqualifies her.

The state, she said, should expand affordable housing to help working Floridians who struggle to cover rising rents.

“I’m barely making it, and I don’t have anyone else to help me,” she said.

The funds intended to help Floridians come from taxes on every real estate sale in the state. The state increased what’s known as the documentary stamp tax on sales a quarter century ago. Seventy percent of the money goes to a local government trust fund to support programs across Florida. It can be used to rehab houses and apartments, build new homes and provide down payments to first-time buyers.

If Central Florida got its entire share of Sadowski funds for the State Housing Initiatives Partnership (SHIP), the four-county region could anticipate $23.68 million in the coming budget year to be used primarily for down payment assistance.

Affordable housing programs are increasingly at risk on both a state and national level. President Donald Trump recently proposed $6.2 million of budget cuts to the U.S. Department of Housing and Urban Development, which oversees homeownership, low-income housing assistance, fair housing laws, homelessness, aid for distressed neighborhoods and housing development.

Housing advocates in Orlando last week said any corporate tax cuts at a national level could chill interest from investors who now purchase tax credits that finance rent-restricted apartments throughout Central Florida and the rest of the state.

Despite prospects for losing funding, needs have mounted for more housing choices in a region where wages have not kept pace with rent increases. Florida’s extremely low-income residents have seen the state’s rental shortage grow from 254,869 units in 2000 to 441,565 by 2015, according to the National Low Income Housing Coalition.

Metro Orlando, with Orange, Osceola, Seminole and Lake counties, ranked behind only Las Vegas, Nev., and Los Angeles for its lack of housing options for very low-income residents, according to a recent report by the coalition. In addition, Metro Orlando median rental prices grew 23 percent during the last decade, as median income for the region edged up just 6 percent, according to data from U.S. Census and Zillow, respectively.

In the Legislature, a Senate budget plan would spend 55 percent of the state’s estimated $292 million affordable housing trust fund on home-purchase and rental programs. In years past, state senators sought for all of the trust fund dollars to pay for affordable housing. This year’s House spending plan would direct just 15 percent of the Sadowski funds to affordable housing.

Budget committees plan to spend an additional $111 million from a related fund, which expires this year.

But affordable housing advocates say those funds are already earmarked for housing programs.

“Our position is that each year, this entire amount should be appropriated for housing,” said Mark Hendrickson, president of the Hendrickson Company. “The need is sufficient to use both the $111 million from the Guaranty Fund and the $290 million in the Housing Trust Funds.”

mshanklin@orlandosentinel.com or 407-420-5538

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