New Plan to Push for Taxpayer-Funded Affordable Housing

    By  Plano Citizens’ Coalition
     
On Monday November 12, the recently completed Housing Trends Analysis and Strategic Plan was presented to the City Council during the preliminary open meeting. There was no action taken during the council meeting. However, attention needs to be directed at the implications this plan would have for Plano’s future should it be approved in its current form.
     
The Housing Trends Analysis and Strategic Plan primarily seeks to address what could be a housing affordability issue throughout Plano in the near future. In a memorandum to the City Manager, the Director of Neighborhood Services stated that “the City is encouraged to be specific and intentional about the tools that may be used to address the housing concerns highlighted in the report.” While region-specific approaches were not elaborated upon within the plan itself, the memorandum also suggests that the City “include mixed-income housing (rental and ownership) for the redevelopment of Collin Creek Mall, the Oak Point Area, and four-corner retail.” Other provisions found within the plan were summarized in the memorandum such as “assemble land for the purpose of redevelopment that includes workforce housing” and “create a public-facing campaign for the down payment assistance program”.
          
The Housing Trends Analysis and Strategic Plan was initiated in March earlier this year. The plan was prepared for the Neighborhood Services Department by a Denver, CO based consultant, Economic & Planning Systems, Inc.  It consists of a study of current supply and demand trends found in Plano’s housing market. Also included are the findings of the Housing Survey conducted by the City of Plano last May. Along with the study, possible policy tools are discussed. The nature of the policies listed is particularly concerning.

Under “Policy Options” on page 21, the plan includes a policy tool referred to as “Housing as Infrastructure”. This idea treats housing as part of the infrastructure the city is responsible for providing in some form. Affordable housing would be funded through the use of general obligation bonds. The plan pointed to Austin as an example of a municipality that practices such a policy on page 153. Austin voters approved a bond for $65 million in 2013 to contribute towards affordable and workforce housing. Also mentioned, is the fact that Austin voters were to consider another bond package on November 6 that included $250 million for affordable housing. Voters approved this measure along with a number of other propositions. If Plano were to approve a similar bond of that magnitude, the Interest and Sinking Property Tax rate (which funds the debt service of general obligation bonds) could very likely be raised. In other words, this policy tool advocates for citizens paying for affordable housing through a portion of their property taxes. The plan correctly notes that “some tools require political will”.
 
Another provision floats the possibility of further regulating the development industry through “land use controls”. Outright blame for affordability issues are assigned to housing developers. The plan claims their prices “are sometimes seen to be a part of the problem”. The plans lists policies such as inclusionary zoning, commercial and residential linkage programs as a solution. As explained on page 142, inclusionary zoning requires developers to set aside a portion of new housing construction as affordable to households at specified income levels. Commercial and residential linkage require developers to pay a fee to be used by a city to construct affordable housing. Ironically, despite suggesting such policy tools, the plan notes that mandatory inclusionary zoning and linkage programs are illegal in the state of Texas. Voluntary inclusion zoning is, however, legal. In this version, developers are asked rather than required to include affordable housing. They are often offered incentives to do so.

The plan references the City’s recent actions regarding the Envision Oak Point Plan as well. It even calls for creating more area specific plans similar to Envision Oak Point throughout the City in anticipation of future redevelopment. Furthermore, as mentioned in the memorandum, it discusses the possibility of establishing an ‘inventory’ of sites with redevelopment potential. A policy tool called “upzoning” could also be utilized. Upzoning is a practice that involves rezoning in order to guide areas that consist mostly of residential to increasingly commercial. It is controversial in the sense that it often leads to congestion and higher population density, negatively impacting residents living in the vicinity of where upzoning occurs. It is unclear where upzoning would be implemented within Plano, as the plan does not elaborate any further.

Under “Policy Direction” on page 29, the plan considers increasing the supply of market rate housing. It blatantly suggests doing so by encouraging a greater number of housing that is “affordable by design” such as townhomes, or greater density housing product types. The plan calls for additional funding and regulatory support for workforce and low-income housing.

The Housing Trends Analysis and Strategic Plan is correct to point out that the number of jobs in Plano has outpaced the growth of residential development. Perhaps this is the root of affordability issues in the short term, as demand exceeds available supply. That could in part, unfortunately, be the result of deliberate attempts by the city government to expand the number of jobs within the City through repeated use of economic development incentives.  Ultimately, how the plan goes about addressing that phenomenon is problematic. The policy tools suggested, if taken seriously, will amount to an unprecedented intervention by the local government into the City’s housing market. Massive costs could be imposed upon taxpayers to fund new programs designed to implement affordable housing. City property taxes have already increased 39.7% over the last five years for the average home. Indeed, this is one affordability issue that the plan fails to address at all. The first step the City of Plano could take to encourage greater affordability is halting the massive increases in property taxes and slashing wasteful spending. Many residents are at great risk of being taxed out of their own homes. It is also difficult to determine the duration and extent of any widespread difficulty to afford current housing prices in Plano. Short of outright clairvoyance, there is little knowledge as to how the housing market will behave in the long run. This plan is an overreaction by the City government and is, in reality, a means to take advantage of a momentary economic situation and increase the City’s power to influence continued development. It should be noted that City Staff pointed out during the 2018-19 budget process that property values appear to be beginning to stabilize. Whether or not this increase in power of government is intentional is irrelevant as this is the consequence of an increased regulatory scope and further costs assessed upon the public. It is not a coincidence that the Housing Trends Analysis and Strategic Plan favors higher density housing developments. This plan is the realization of the vision belonging to the current City Council majority. It is the latest in a series of measures to increase government spending, move towards a central planning style of development, and generally expand the role of local government.  

Plano Citizens’ Coalition believes in a vision for Plano defined by a free market and minimized cost of government. The zoning process exists to minimize conflicts and functionality issues as developers with diverse interests and goals utilize their land holdings in close proximity to one another. It is not a tool for elected officials to use to reconfigure our community as they see fit. What costs that are assessed upon the taxpayers should strictly be confined to public safety, infrastructure, and other basic services. This plan is fiscally irresponsible in the sense that it adds to what is forfeited unnecessarily in a manner that is not directly beneficial to all of those from whom the funds were acquired. PCC implores the City Council to be proactive and abstain from authorizing any market intervention that could have far reaching consequences for the community. It is worth noting that within Appendix A of the Housing Trends Analysis and Strategic Plan is a staggering number of comments received from participants of the Housing Survey that reflected a sense of urgency concerning rising property taxes, dissatisfaction with the excessive proliferation of high-density residential developments, and a desire for open space in the form of parks. It is time for our city government to begin listening to those that it is supposed to serve and turn back from what could become an irreversible loss in the qualities and characteristics that make Plano a great community to be a part of.