Expert Panel Helps Dallas Take Steps Toward a New Housing Policy

Published by Mark Shelburne on Monday, March 28, 2016 - 12:00am

During the first week of March, dozens of people in Dallas worked together toward a common goal: examining existing housing policy and practice and identifying a path forward for providing affordable rental homes and affirmatively furthering fair housing. And while some of the factors and questions considered were specific to Dallas, other local governments might also benefit from replicating the process and learning from the outcomes.

Background

The Urban Land Institute (ULI) is a 37,000 member association focused on land use and real estate development. One of its main programs is providing advisory services panels. ULI says these expert panels give “independent, timely, candid, and unbiased input” to assist with challenges, opportunities, problems or other tasks.

The city of Dallas asked ULI for help in developing a new housing policy. There were three catalysts for this effort.

  1. As many readers know, Dallas was the setting for last summer’s Supreme Court disparate impact decision. While the legal holding was national in scope, the underlying facts were local.
  2. Soon after the ruling, the U.S. Department of Housing and Urban Development (HUD) issued its final rule on the duty to affirmatively further fair housing. All recipients of federal housing funds, including large cities, will have to comply with the revised process.
  3. In 2014, the city entered into a voluntary compliance agreement with HUD in response to a complaint filed by a developer.

The Task

Together these realities led the city to seek input on its approach to housing. Specifically, ULI was charged with:

  • interviewing stakeholder groups,
  • evaluating existing housing policies,
  • reviewing best practices of other municipalities, and
  • presenting suggestions for inclusion in a new housing policy.

ULI asked 10 professionals to serve on the panel, including me. The panelists were from varied backgrounds: consultants, developers, an equity investor, university professor and Stockton Williams of the ULI Terwilliger Center. Tony Salazar, president of west coast operations for McCormack Baron Salazar, served as the chair.

City staff provided extensive briefing materials so panelists could prepare in advance. After arriving, the group toured many different types of properties and neighborhoods, ranging from deep poverty to very high income.

Possibly the most important aspect of the panel’s work took place on day two. The panelists split up and interviewed more than 70 different people serving in various capacities: elected officials, city staff, other government officials, advocates, trade associations, nonprofits and local developers.

Over the next two days panelists met from dawn until dusk discussing what had been learned and next steps for the city. The group also spent considerable time drafting recommendations. Altogether each panelist spent 60 hours or more preparing, interviewing, participating in meetings, writing and following-up. On March 4, the panel made a presentation to the city council’s housing committee.

Recommendations

The panel made several recommendations, including:

  • creating a temporary chief executive officer of housing and community investment,
  • establishing a housing trust fund with dedicated revenue sources,
  • identifying a limited number of housing and community revitalization focus areas, and
  • expanding housing choices in high opportunity areas

The last two of these are examples of the continuing national conversation about where to invest limited subsidy resources.

The panel suggested choosing a few communities to revitalize based on having at least three of these features: major employers, existing housing, quality schools, healthcare, transit options and shopping. The group agreed that Dallas should plan and select catalytic projects in these areas.

In high opportunity areas, the city should work with other institutions/agencies to assess real estate owned and also independently acquire land for mixed-income development. There should be attempts to increase the placement of Housing Choice Voucher holders in such areas. Options include leasing to a partner entity and engaging an apartment listing service (e.g. SocialServe.com).

Conclusions

The intersection of fair housing and affordable rental housing production programs presents myriad, complex challenges. On the one hand, governments have a responsibility to overcome historic patterns of segregation and create choices for all residents. On the other, some areas of a city need to be revitalized, some people do not want to move out of their neighborhoods, NIMBYism can be difficult to overcome, and land cost in opportunity areas is often very high.

Simply put, there are no easy answers. The situation calls to mind the H.L. Mencken quote, “Explanations exist; they have existed for all time; there is always a well-known solution to every human problem — neat, plausible, and wrong.”

Importantly, the difficulty does not allow or excuse inaction. Accepting federal housing funds means being a good steward of the resource and agreeing to affirmatively further fair housing. Both require thoughtful, deliberate decision making.

Dallas has taken a big step in this direction. Other cities may be well served to replicate variations on the same approach. Interested parties should contact me to learn how Novogradac & Company can assist.