Asheville City Council’s Housing Business - TribPapers

Asheville City Council’s Housing Business

Asheville – Chuck Warner set the stage for much of what would be on Asheville City Council’s agenda. In the three minutes allotted to individuals for public comment on the consent agenda, he did what he could to explain, in principle and theory, why raising property taxes to pay for affordable housing made no economic sense. Unfortunately, trying to teach the halls of power about supply and demand is about as easy as teaching vector calculus to a wall.

Most significantly, the city council unanimously approved granting Homeward Bound $2 million to acquire the Days Inn on Tunnel Road to create permanent supportive housing (PSH). PSH is designed for the chronic homeless, those with mental health issues; especially, addiction. It provides medical care, counseling, and whatever other social services somebody might need to remain off the street. The shelter the city was supporting at the Red Roof Inn, by way of contrast, was more for hard-working and generally successful individuals who drew a short COVID-19 straw. The latter was never intended to be provided for more than a couple of months.

The Days Inn has 128 guest rooms, but Homeward Bound is only going to convert 85 into PSH. Homeward Bound will move its headquarters into the building and have several professionals requiring office space for both administration and patient visits. The total cost of converting the inn into PSH, with kitchenettes installed in every guest room, was estimated to be $6.9 million, with another $6.5 million needed to cover acquisition costs. The acquisition costs were to be paid by the City of Asheville, Buncombe County and the Dogwood Health Trust, each granting $2 million; an unnamed private donor contributed $500,000. 

Operational costs were projected to run around $1,166,062 annually, with revenues around $1,321,900 and much of the project’s income to be paid with housing vouchers. Without citation, the staff report said PSH projects like this can save the city $17,000-$37,000 per person per year. The city’s payment, which Homeward Bound requested be made in the form of a grant, is funded by the American Rescue Plan Act (ARPA).

Councilwoman Kim Roney was delighted to see the city decommission a hotel and convert it into a locationally efficient PSH. Councilwoman Gwen Wisler asked what would happen if one of the other parties contributing to the acquisition were to back out, and she was told they were all on board.

During public comment on the issue, Sherry Warner asked if the inn help the homeless in Asheville or be a regional hub for the homeless—Mayor Esther Manheimer said it would be the latter. Mel Noyes scolded council and told them to defund the police.

In Other Matters –

Council improved incentives of about $51,899 a year for sixteen years for Millstone Management. Millstone wants to build an 86-unit apartment complex on Long Shoals Road. The incentives are in exchange for rent-controlling 17 units as affordable to persons earning no more than 80 percent of AMI for 20 years. Additional points were scored in the city’s Land Use Incentive Grant program for building in a locationally-efficient area with high incomes and using solar panels.

Next, council unanimously approved the sale of two single-family residential lots, currently owned by the city, to the Asheville Buncombe Community Land Trust, for $1 each. The lot on West Chestnut Street is appraised at $100,000; the one on Lufty Avenue, at $85,000. The lots will be used to build affordable housing valued at $130,000 for families earning no more than 60 percent of AMI. Should the buyer decide to sell later, he would have to sell to an income-qualified family.

Wisler asked how a home deed restricted against gaining equity was supposed to create wealth. She was told a selling homeowner would get a portion of the “shared equity.” Councilwoman Sandra Kilgore asked what would be done to remove the appearance that there’s an inside track for city leaders to give their great home deals to friends.

By way of the consent agenda, city council unanimously approved extending contracts with two hotels that have been housing persons displaced by COVID-19. The extensions would be paid with ARPA funding. The Ramada Inn in Fairview would receive an additional $538,168, and the Econo Lodge on Tunnel Road would get another $92,850. Then, Sunrise Community for Recovery and Wellness will receive another $244,213 for providing social services to those staying at the inns, bringing total city expenditures on this initiative to date to $1,761,637.

The council unanimously approved authorizing staff to apply for a Federal Transit Administration Areas of Persistent Poverty grant to fund community engagement and planning for including affordable housing, or even a low-barrier shelter, in an expanded transit center downtown. 

Developing the plans would meet all objectives for qualifying projects; namely, “[improved] system condition and service reliability, enhanced access and mobility, accelerating innovation, emission reductions, barriers to low income housing, racial equity and [lowered] barriers to opportunity, and environmental justice.”

Lastly, council approved entering into an interlocal agreement with Buncombe County for a Homeowner Grant Program. Should the property tax increases needed to cover any of the above affordable housing solutions force anybody out of their homes, the city is setting aside $150,000, or about 0.75 cents on the tax rate and more if necessary, for taxpayer assistance. The county is setting aside $200,000.

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