Philadelphia City Council has made significant progress on a crucial piece of legislation integral to Mayor Cherelle Parker’s expansive $2 billion housing initiative, which aims to address the city’s pressing affordable housing crisis.
The Council granted preliminary approval to a bill on Thursday that authorizes the city to borrow $800 million in bonds through a service agreement with the Philadelphia Redevelopment Authority.
This funding is expected to be combined with additional public funding and around $1 billion from city land and assets to help construct and preserve 30,000 housing units.
Hours of negotiations culminated in the advancement of four zoning bills designed to support the administration’s goals under the Housing Opportunities Made Easy, or H.O.M.E., initiative.
All five measures are anticipated to receive final approval during a vote on June 12, aligning with Parker’s goal of launching her housing strategy alongside the city’s upcoming budget, which is due by July 1.
Given Philadelphia’s status as the poorest large city in the United States, the administration’s officials stress the urgency of the H.O.M.E. proposal.
“We have a crisis and we want to address it now,” said Tiffany Thurman, Mayor Parker’s chief of staff, during a May budget hearing.
Thurman commented on the administration’s commitment to move forward without being immobilized by delays.
The bond legislation would allocate the $800 million to support over three dozen existing programs focused on creating and preserving housing, providing rental assistance to low-income tenants, removing vacant properties, and preventing homelessness, among others.
Highlighted among these initiatives is the Basic Systems Repair Program, which offers free repairs for homeowners unable to afford necessary fixes, addressing issues like plumbing, electrical, and heating.
Additionally, the H.O.M.E. funding includes the Shallow Rent Program to assist cost-burdened tenants who risk eviction.
If the full Council approves the measures, the Philadelphia Redevelopment Authority plans to execute the borrowing in two phases of $400 million each, beginning in the fall.
The second tranche would occur two years later, contingent upon the pace of spending, according to Finance Director Rob Dubow.
“The capacity exists to swiftly distribute these funds,” Dubow emphasized.
The legislation also establishes oversight mechanisms for the Council and the City Controller’s Office regarding the expenditure of the bond proceeds.
Following amendments, the Parker administration is mandated to present quarterly program statements and budgets for approval by the Council.
The final version of the ordinance sets up a “Project Review Team,” made up of two individuals appointed by the mayor and two by the Council president, who can alter allocations within a 10% threshold of annual spending on H.O.M.E.
Significantly, the bill permits the sale of 1,000 parcels of city-owned land without legislative approval from district council members, which aims to expedite the development process by pre-approving properties for redevelopment.
During the hearings, Councilmember Isaiah Thomas expressed concerns regarding the administration’s funding strategy, advocating for a more measured approach to the $800 million bond authorization.
Thomas asserted that caution is necessary, particularly as the city faces diverse fiscal needs and potential reductions in federal funding.
His perspective underscores the complex financial landscape within which the city is operating.
Conversely, Councilmember Jamie Gauthier, who is not a member of the Finance Committee, voiced support for Mayor Parker’s ambitious bond initiative.
She stressed the critical need for substantial investment to alleviate the housing crisis and preserve the unique character of Philadelphia.
“I don’t always agree with the mayor on philosophical or ideological issues. However, I firmly support her on this issue,” Gauthier stated, underscoring the urgency for action on housing.
Ultimately, the Council moved forward with allowing the full $800 million to be borrowed.
Director Dubow noted that the total cost of the loan, including interest, is projected to be approximately $1.3 billion over time.
As part of the zoning legislation approved by the committee, minimum parking requirements for certain multifamily developments will be eliminated, and a new residential zoning district will be created.
The adjustments aim to lower construction costs in high-demand areas and streamline the approval process for stacked townhomes.
Moreover, zoning restrictions will be eased in the 5th Council District, facilitating taller and denser housing developments in key neighborhoods such as Center City, Fairmount, Fishtown, and North Philadelphia.
The situation continues to evolve, with updates expected as the Council progresses toward the final vote on these pivotal housing measures.
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