Affordable Housing Trust Fund
INTRODUCTION TO THE AFFORDABLE HOUSING TRUST FUND
In November 2016, City voters approved a Charter Amendment to create the Affordable Housing Trust Fund. Article I, Section 14 of the City Charter establishes the Trust Fund, sources of revenue, administration and oversight, membership and roles and responsibilities of the Commission, income requirements permitted uses and affordability periods.
The Fund is intended to support both rental and for-sale affordable housing for very-low and low-income households. The Trust Fund requires that all revenue be used to help those with incomes at or below 50 percent of the Area Median Income (AMI) as established by the Department of Housing and Urban Development (HUD) (approximately $46,000 for a household of four in 2018) and that at least half of the funds be used to help those with incomes at or below 30 percent of the Area Median Income (approximately $27,000) for a household of four in 2018.
City Council Bill 18-0221, Ordinance 18-215, Recordation and Transfer Taxes, “Yield” Excise Tax – Dedicated Proceeds to the Affordable Housing Trust Funds, was signed into law on December 12, 2018 and became effective in January 2019. The legislation provides a long-term source of funding through a .06 percent excise tax on the transfer of real property valued at or above $1 million and a 0.15 percent excise tax on the recordation tax for real property transactions value at or above $1 million. Approximately $13 million per year is expected to be generated through the proposed new excise taxes.
The City allocated additional funds to support the Trust Fund as follows:
|FY2023 and subsequent years||$7 million|
The Trust Fund will be administered by the City’s Department of Housing & Community Development (DHCD) and overseen by an advisory commission that includes representation from housing advocates, developers, financers and others with expertise in housing and community development. The Commission is charged with making recommendations to DHCD regarding policies, rules and regulations pertaining to the implementation, expenditures, and operation of the Fund.
AFFORDABLE HOUSING TRUST FUND COMMISSION
The Affordable Housing Trust Fund Commission is overseen by a 12-member commission whose membership is included in the Charter requirements:
- Experience in the fields of housing, community development, planning, social services or public health – member is specified as appointed by the Mayor
- Member of the lending community with experience in community development and affordable housing finance
- HCD Commissioner or Designee
- Resident who rents and is at 30 percent or less of AMI
- Resident homeowner and is at 50 percent of less of AMI
- Homeowner who received assistance through an affordable housing homeownership program
- Social Service provider
- Representative of Homeless Service Board
- Low income/fair housing advocate
- Nonprofit affordable housing developer
- Homerbuilders or realtor association
Commission members who represent specific income classifications are required to be City residents.
Commission members are appointed by the Mayor and confirmed by the City Council. Members are appointed to service until December 2020, concurrent with the term of the Mayor. The Mayor appoints a President of the Commission. Commission members are subject to the City’s terms and requirements for all Boards and Commissions, which can be found in Article IV, Section 6 of the City’s Charter.
CLICK HERE TO READ MORE ABOUT BOARDS AND COMMISSIONS (under development)
The Commission serves in an advisory capacity, helping to establish a meeting schedule and spending policies for Affordable Housing Trust Funds. The Charter requires that the Commission submit an annual report to the Mayor and City Council outlining how funds were spent and residents who were assisted. The Commission also ensures that the Fund is audited every four years by a certified public accounting firm.
The Affordable Housing Trust Commission is subject to the requirements of the Maryland Open Meetings Act which requires that meetings be open and accessible to the public, that meetings be advertised, and that agendas along with the minutes from those meetings also be available to the public. The Act also requires that the Commission designate one member who receives training in the Open Meetings Act requirements and ensures that the Commission is in compliance.
Commission meetings are open to the public, however, there is no legal requirement that the public be permitted to participate in meetings. DHCD will publish a meeting notification on its website and in public places of each meeting of the Affordable Housing Trust Fund Commission that includes the date, time, and location along with an agenda. The agenda could include items that may be considered as part of a closed session that would not be open to the public.
DHCD will make minutes available on its website, following their approval by the Commission.
THE NEXT MEETING OF THE AFFORDABLE HOUSING TRUST FUND COMMISSION WILL BE HELD ON TUESDAY, JULY 23, 2019, 6-8 p.m. (EDT).