by Michael Lyle, Nevada Current
September 20, 2021
The Nevada Housing Coalition is asking the state to invest $500 million from the American Rescue Plan Act into affordable housing with a large focus on building units for the most vulnerable renters.
The coalition released recommendations Sept. 13 and suggested Nevada invest $275 million specifically to build more multi-family rentals with dedicated funds toward units supporting people earning below 30% of area median income (AMI) and those in need of intensive services.
“It is our greatest deficit, and an area we haven’t invested in because it’s the most expensive to build,” said Christine Hess, the executive director for the Nevada Housing Coalition.
Hess added if Nevada used ARP dollars as the coalition recommended, it would be the first time the state made a targeted investment to develop units for the most vulnerable renters.
“It’s really investing in those hard-to-build units,” she said, explaining that creating housing for renters making below 30% of area median income and permanent supportive housing units requires “very heavy subsidies and services to come alongside them for sustainability.”
The Nevada Housing Coalition estimates the state has an 84,000-unit deficit for extremely low-income renters, or those earning less than 30% AMI. In total, the state lacks more than 105,000 affordable units.
Hess said these renters “are often in the workforce, but also include seniors on fixed incomes or those with disabling conditions.”
About 82% of those renters, the group notes, pay more than half their income on rent, adding that there are only 20 affordable and available homes per 100 such renter households.
With an infusion of $275 million, the coalition estimates the state could build 1,710 units. The recommendation suggests 750 units go toward incomes under 30% AMI, 700 for units for incomes of 60% AMI or lower, and 260 units for permanent supportive housing.
The group is emphasizing the need to include funding for housing that also includes supportive services or permanent supportive housing, which is an intervention that can help those experiencing homelessness, or who have no income, access additional resources while housed.
“In our analysis we are proposing 260 units of permanent supportive housing that includes not just building the actual structure but includes operations and services to make them sustainable,” Hess said.
According to the Corporation for Supportive Housing, which helped with data collection for the coalition, Nevada needs 7,828 supportive housing units to assist people who experience homelessness chronically, are coming out of prison or jail or getting treatment for substance abuse.
Funding provided by ARP means Nevada could use unprecedented funds to begin addressing its housing deficits, Hess said.
Of the $6.7 billion total Nevada received from the federal relief package, $2.7 billion was allotted toward direct aid the state can use how it wants and $1.04 billion was directed toward localities. ARP funds also include $338 million specifically for housing.
“These funds represent for our state an opportunity to really transform not just how we invest in affordable housing, but how we approach and prioritize affordable housing for all Nevadans and our state going forward,” Hess said.
Nevada Treasurer Zach Conine is conducting a statewide listening tour, which started Aug. 3, to collect ideas for how the state could use ARP dollars to fix systemic problems.
Over the past few months the coalition, which consists of non-profit organizations, social service providers, businesses and banks, asked its members to provide feedback on how Nevada should address its affordable housing crisis.
“One of the biggest things for the team was really just asking and listening so we could best capture and represent the perspectives of those working in the fields, those experts, those boots on the ground and what they’re seeing,” Hess said.
While there are often numerous barriers to creating affordable housing, including political will and logistical obstacles from land availability to zoning restrictions, financing is one of the most difficult parts, which is why a significant portion of the recommendation included money for creating new units.
In addition to investments in building multi-family units, the Nevada Housing Coalition recommends the state allocate:
- $125 million to preserve existing affordable housing stock;
- $50 million to invest in land through Community Land Trusts;
- $50 million for creating more affordable for-sale homes along with expanding down payment assistance, especially for groups hardest hit by the pandemic.
“Something new that developed from the conversations, discussions and feedback was the fact that land rose to the top so much that it became its own area of funding,” Hess said. “The task force is recommending 10% of our recommendation be designated for an investment in land, because land is such a barrier to development. This would be new for the state. We don’t have current programs that invest in that.”
The state is at risk of losing 7,500 affordable units in the next five years.
Lawmakers passed Senate Bill 12, which gives localities and tenants a 12-month notification before affordable housing units transition to market rate, but the legislation didn’t provide funding for preservation efforts.
With an infusion of $126 million, the analysis projected 1,625 units could be rehabbed or acquired.
Hess said these recommendations are part of the coalition’s first phase. It is developing a follow-up phase to work with experts in order to “dig into potential ways to leverage the American Rescue Plan dollars in the most effective ways with other funding sources.”
“While we have estimates of how much housing we can produce, they are just estimates to show we are doing some analysis,” Hess said. “The next phase we’ll be getting into how we think we can maximize these dollars against other funding sources.”
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