Philadelphia’s Mayor Cherelle Parker’s administration celebrated a significant achievement as City Council approved essential legislation to support her ambitious H.O.M.E. initiative.
This landmark housing proposal, which seeks to create and preserve 30,000 housing units during Parker’s term, is underpinned by an $800 million bond.
With confidence in the associated funding, the administration plans to couple it with additional public resources and an estimated $1 billion worth of city land and assets.
The anticipated funding is set to begin flowing in the fall, coinciding with the recent passage of the city’s $6.8 billion budget.
H.O.M.E., an acronym for Housing Opportunities Made Easy, was formally launched back in February, reflecting a core commitment made by Parker to prioritize housing issues in Philadelphia.
Parker has vocalized that, following public safety, addressing the ongoing housing crisis is the pivotal issue facing the city.
The administration highlighted that Philadelphia is grappling with a dire housing shortage, estimated at around 17,000 units, alongside significant challenges caused by the aging housing stock.
“We have a crisis and we want to address it now,” stated Tiffany Thurman, chief of staff to Parker.
“We don’t want to be paralyzed by inaction.”
This initiative targets several key objectives: facilitating the construction of new housing, incentivizing revitalization projects, combating housing instability, and enhancing access to rental assistance and mortgages.
According to the plan, 13,500 new units will be constructed while 16,500 existing units will be preserved, with the majority of these affordable to families earning less than $100,000 annually.
Furthermore, over 20,000 units are designated for families earning about half that amount.
Parker stressed her resolve to collaborate closely with City Council to promote policies that create pathways to self-sufficiency without fostering divisions between income classes.
However, some advocates for affordable housing have expressed reservations regarding H.O.M.E., arguing that it may not adequately support those in dire need of deeply affordable, safe, and habitable housing.
In parallel, the Philadelphia Housing Authority is developing a separate plan to significantly transform and create housing units for the city’s lowest-income residents.
The $800 million bond will fuel more than three dozen housing programs, existing ones that will receive expansion, as well as new initiatives aimed at enhancing the city’s housing ecosystem.
An estimated $500 million from the total bond is allocated to six primary initiatives, which include gap funding for affordable housing development and preservation.
Additionally, the Basic Systems Repair Program, a long-standing initiative, will receive funding to provide free repairs to low-income homeowners, allowing them to address critical issues in their homes.
The administration intends to raise eligibility limits for this program to cover households earning up to 100% of the area median income, which translates to roughly $119,400 a year for a family of four, expanding the support base significantly.
Moreover, the funding aims to enhance the Turn the Key program, which provides city-owned land to facilitate the creation of affordable housing for first-time homebuyers.
The land is essentially donated to developers, allowing homes to be priced between $190,000 and $280,000, thus making them more accessible.
In addition to these programs, the One Philly Mortgage initiative is set to offer 30-year fixed-rate loans to first-time buyers earning up to 120% of the area median income.
The plan also looks to expand the Philadelphia First Home program, which assists first-time homebuyers with covering down payment and closing costs.
Measures will be put in place to deliver rental assistance to tenants struggling to keep up with costs, as well as financing options for landlords needing to make necessary repairs to their properties.
Regarding the financial implications of the bond, the Parker administration is working under a service agreement with the city, planning for the Philadelphia Redevelopment Authority to issue the $800 million in two phases.
The first tranche is expected to be realized in the fall, with the second contingent upon the authority’s spending pace, anticipated in two years.
When accounting for interest, the combined cost of the two tranches is projected to total approximately $1.3 billion, with average annual interest payments reaching around $25 million over a span of 20 years.
Director of Finance Rob Dubow described issuing bonds as a strategy for long-term investments, illustrating the critical nature of housing as such an investment.
While City Council widely backed the H.O.M.E. initiative, some members voiced concern regarding the upfront authorization of the entire $800 million amount, emphasizing other pressing fiscal needs beyond housing, like education and poverty.
Councilmember Isaiah Thomas remarked that the two years prior to the second tranche could be used to identify and resolve potential issues.
In terms of accountability, the legislation that Council passed includes oversight measures, ensuring that spending of the $800 million bond is monitored.
The Parker administration will need to submit program statements and budget reports to Council on a quarterly and annual basis for approval.
Furthermore, the final ordinance establishes a Project Review Team composed of two mayoral appointees and two appointed by the City Council president.
This team will have the authority to adjust program funding allocations as long as such changes do not exceed 10% of the annual H.O.M.E. spending; any larger modifications will require legislative approval.
During a recent public appearance, Parker reassured citizens that her administration is committed to fulfilling the objectives laid out in the H.O.M.E. initiative, stating, “We are going to make good on our commitment.”
As the city steers toward implementing this comprehensive housing strategy, the question looms: will the H.O.M.E. initiative adequately meet the pressing housing needs of Philadelphia’s diverse communities?
image source from：https://whyy.org/articles/mayor-parker-housing-plan-approved-philadelphia/
