February 13, 2024

Hon. Robert White
Chair, Committee on Housing 
Council of the District of Columbia
John A. Wilson Building
1350 Pennsylvania Ave. NW, Washington, DC 20004

RE: Performance Oversight for the Department of Housing and Community Development (DHCD) and Housing Production Trust Fund (HPTF)

Dear Chairperson White and members of the Committee:

Please accept these comments on behalf of the Coalition for Smarter Growth. The Coalition for Smarter Growth is a nonprofit organization that advocates for walkable, bikeable, inclusive, and transit-oriented communities as the most sustainable and equitable way for the Washington, DC region to grow and provide opportunities for all.

HPTF is an invaluable resource

We wish to express our strong support for the HPTF, and urge the Council to remain committed to this essential tool for addressing our acute housing affordability challenges. Without it, we would be so much farther behind, leaving thousands of families without the homes they now enjoy. DC’s strong commitment to preserving and producing affordable housing is one of the leading efforts in the country. While our housing affordability challenges are severe, the HPTF provides irreplaceable capacity to address our needs. 

Since 2015, the fund has produced 11,758 units at an average subsidy per unit under $150,000. The fund finances the construction, rehabilitation, and acquisition of affordable housing. A recent 100-year projection of continued support for the HPTF with annual allocations at or above $100 million show that DC would achieve nearly 165,000 units over this period. This is a substantial contribution to our city’s affordable options. 

Preserve the HPTF investment by requiring in perpetuity covenants 

The value of this investment is reinforced by the priority that DHCD gives to permanent affordability covenants. We ask the Council to build on this priority and strengthen it by not only preferring in perpetuity terms, but requiring all HPTF dollars are for preserving affordability in perpetuity. In perpetuity is already required for affordable housing in public land dispositions.

Fund 30% MFI operating costs by bridging the gap between 50% and 30% MFI cost.

HPTF was not set up to meet its obligation to provide homes to households at the 30% median family income level. We recommend that an innovative funding mechanism be created inside HPTF to fund the operating costs of extremely low income units by providing an operating subsidy that bridges the gap between 50% MFI units and 30% MFI units. This would complement existing LRSP funding which focuses on lower income households.

Address the LIHTC crisis with transparency and engagement by DHCD & HFA

Lastly, we wish to express our dismay regarding the crisis in 4% Low Income Housing Tax Credits (LIHTC). Due to DC hitting its bond cap, no more 4% LIHTCs can be allocated. This was a sudden and shocking announcement in August of 2023. We fought for innovative affordable housing projects that were approved at the Zoning Commission. But in the wake of the August announcement, we learned these projects were on the brink of collapse due to no advance notice provided by DHCD and DC HFA that no new LIHTCs would be available, and no information was provided about when this would change. Some of these projects have been lost, others are hanging on with great uncertainty, and could be lost at any moment. 

DC HFA has provided little information about what it is doing to work on the problem and has not communicated about when tax credits are projected to be available again. While DHCD is not directly at fault for this, we urge the Council to work with DHCD and HFA to create a new level of transparency to ensure that our robust affordable housing development sector and tenant associations seeking to buy their buildings can anticipate future funding availability. 

Thank you for your consideration. 

Sincerely, 

Cheryl Cort
Policy Director