For more than two years, Pittsburgh Councilman Danny Lavelle has been working to create a fund to develop and preserve affordable housing in the city. Last week, he and his fellow board members at the Urban Redevelopment Authority took their first step toward realizing that goal with a unanimous vote to administer what they are calling the “Housing Opportunity Fund.”
Lavelle thanked the board members for their diligence and hard work, but reiterated his desire to “front load,” possibly with loan or grant money, which would be paid back though increased realty transfer tax revenue dedicated to the fund.
“That way we can put a large amount of resource toward a project now, instead of waiting until the tax revenue filters in,” he said.
The increase in the city’s realty transfer tax, from 4 percent to 4.5 percent, was approved by City Council Dec. 17 and is projected to raise about $6 million of the $10 million to be designated to the fund annually. The city has yet to identify a source for the remaining funding.
However, as URA Executive Director Robert Rubinstein noted in his report, the transfer tax is scheduled to increase to 5 percent in 2020, and it is anticipated that the increase alone will be sufficient to raise the housing fund’s $10 million budget.
According to figures released by the Affordable Housing Task Force, the city faces a shortage of about 17,000 affordable units. Currently more than 23,000 Pittsburghers spend more than 50 percent of their monthly income on housing.
In addition to building and preserving both affordable for-sale and rental units, the housing fund monies can be made available for foreclosure prevention, home rehab and repair projects for low-income owners, and even closing-cost assistance for first-time homebuyers.