The City of San Antonio will receive up to $19.5 million from the U.S. Department of Housing and Urban Development during the 2018 fiscal year for a variety of affordable housing projects along with related infrastructure and support programs. The future of such grants, however, is uncertain as President Donald Trump’s budget blueprint calls to cut them entirely.
After approving those grants on Thursday, City Council also approved plans for a 296-unit affordable housing complex on the city’s Northwest side, largely funded through the San Antonio Housing Trust. The project received neighborhood support and opposition, causing tension among some Council members. Both discussions on Thursday emphasized San Antonio’s need to develop a comprehensive housing strategy, many Council members said.
The money from HUD will go through four different federal entitlement programs: $12.2 million for Community Development Block Grant (CDBG), $4.9 million for HOME Investment Partnerships Program (HOME), $1.41 million for Housing Opportunities for Persons with AIDS (HOPWA) Program, and $1.03 million for the HEARTH Emergency Solutions Grant (ESG).
The City will allocate 44 existing staff members to various departments to facilitate grant implementation, but the “biggest challenge,” according to Deputy City Manager Peter Zanoni, is finding contractors willing to carry out the construction and rehabilitation work that the CDBG and HOME grants call for.
The City has received complaints about “shoddy” work at affordable housing projects, Zanoni said, and is working on finding contractors that can follow the strict federal regulations attached to the money, can afford to wait to get paid until after the project is complete, and can deliver a high quality product.
This is a tall order for the construction industry, he said.
“Unfortunately with the federal grants, that’s how they work,” said Veronica Soto, director of the City’s Neighborhood & Housing Services Department, explaining the federal regulation that doesn’t pay developers for a project until it is complete. “We’re working to get more contractors in the pipeline.”
Residents interested in applying for federal assistance can find out more at the City’s Grants Monitoring and Administration website here. Under “Public Notices,” contractors can find request for proposals and qualifications for various grant projects.
Soto and staff of the newly established department plan on pulling financial and nonprofit institutions together to help streamline the process. Her department also oversees implementation of the $20 million allocated to Neighborhood Improvements through the 2017 Municipal Bond.
On average, HUD funds about 25 single-family rehabilitation projects per year, Zanoni said, but the City has not always taken full advantage of funding. This year, the City has $6.5 million – which includes rollover funding from previous years’ CDBG and HOME grant – and could rehabilitate approximately 81 homes at $80,000 each. But again, they’ll need to find qualified builders to do it.
“We need to ramp up production,” Zanoni said. “We need more contractors.”
There is plenty of demand, Soto said. Not counting the hundreds who have been approved, “we have 45 applicants waiting [to receive housing assistance] … and a waiting list of 250 people that want to see if they can qualify.”
Construction firms have difficulty complying with regulations and so do residents, she said. “The regulations are strict about what a homeowner needs to have,” such as deeds for the home and insurance. Another challenge her department faces is connecting residents to resources that can help acquire these documents.
But Soto and her staff “enjoy a challenge,” she told City Council, which unanimously approved the measure. Councilman Manny Pelaez (D8) recused himself from the vote.
Councilman Rey Saldaña (D4) attributed some of the hurdles between families and access to housing resources to the City’s and private partners’ own lack of experience with affordable housing.
“This is a muscle we have not really exercised much,” Saldaña said.
It’s a muscle that may experience a degree of atrophy if Trump’s budget includes further cuts or elimination of entitlement programs that allow for the limited affordable housing stock that San Antonio has.
Several members of COPS/Metro spoke in favor the federal grant programs. The nonpartisan coalition that advocates for various policies and projects is taking on affordable housing as one if its top priorities and has been working to bring home rehabilitation resources to residents.
Walker Moore, interim lead organizer for COPS/Metro, told the Rivard Report later that this renewed advocacy for maintaining affordable housing took shape months ago. When the organization hosted an accountability session for candidates vying for City Council, Nirenberg and others committed to fund such programs.
COPS/Metro helps City Council stay on the right side of “a number of issues,” Nirenberg said Thursday.
If the HUD grants are defunded, Zanoni told the Rivard Report, those 44 staff positions would go away. Employees could get rededicated throughout other City departments as they have interchangeable skills. But without federal funding, some positions would be removed immediately or through attrition.
The largest portion of CDBG funds, $4.8 million, will go toward paying off a $57 million capital improvement loan HUD gave the City in 2006 – a kind of “cash advance,” Zanoni said. San Antonio would still be on the hook for paying back the remaining $28.6 million balance with $4.5 million minimum payments each year through 2026.
Click here to download Zanoni’s presentation to Council.
Council also unanimously approved $35 million in multi-family housing revenue bonds from the San Antonio Housing Trust to go toward a $58.5 million affordable apartment complex in District 7 on Thursday. Mayor Ron Nirenberg stepped off the dais at the time of the vote.
The 296-unit Trails at Leon Creek, located off of Bandera Road and Mainland Drive, will be owned and operated by Pedcor Investments, an Indianapolis-based affordable housing developer.
Several citizens signed up to speak against the project, citing school district capacity, traffic concerns on an already busy street, and a lack of community engagement from former Councilman Cris Medina and current Councilwoman Ana Sandoval (D7).
Sandoval told Council and citizens gathered that she learned an “incredible” amount from this particular project and felt she had put in the work to communicate with City staff and the community about their concerns.
City staff explained that the nearby Northside Independent School District’s middle and high schools had plenty of room to accommodate more students, and that the City is working with TxDOT on a plan to alleviate traffic on Bandera Road.
City staff cited the seven project-related public meetings that have taken place since December 2016 as opportunities for community feedback and engagement, but it was Councilman Greg Brockhouse (D6) who delivered the most compelling evidence that the City and Sandoval did their due diligence.
He attended several of the meetings as the project is adjacent to District 6.
“I saw her get attacked and humiliated” for taking a position on the project, Brockhouse said. “Personal attacks against someone just trying to do their job.”
Despite that, he said, Sandoval remained professional and engaged the very people who attacked her.
“I witnessed grace under a lot of that pressure,” Brockhouse said.
Later on in the discussion, Pelaez called out some of the citizens whom he felt simply didn’t want low-income neighbors moving in.
What he heard, Pelaez said, is “I don’t want to live next to undesirables,” noting that the people who need affordable housing are senior citizens, veterans, and families. High density, affordable housing projects often encounter a NIMBY (Not In My Back Yard) reaction.
“Shame on all of you,” he said to the audience – some of whom protested that he misinterpreted their opposition.
But shame is not what the Council should bring to the conversation, Brockhouse said.
“You can come safely to this chamber and disagree,” Brockhouse said, referring to Pelaez’s comments. “That doesn’t make you phobic or a hater.”
City Council should foster and facilitate a space to have “graceful disagreement,” he said. “Out of the conflict of dialogue comes better policy.”
Since taking office in June, Nirenberg has dissolved the Council’s Housing Committee, forwarding housing conversations to the Comprehensive Planning Committee.
When he announced the change in July, the mayor said the Housing Commission would have “a sharper focus on developing a comprehensive housing policy.
“Housing cannot be removed from a conversation about equitable and planned growth. Having a focus on housing as a pillar of a healthy city is important.”