Kansas City Council to weigh easing affordable housing rules
The Kansas City Council will consider easing affordable housing requirements for private developers on Thursday after a measure pushed by Mayor Quinton Lucas won its first approval.
Dozens of opponents along with the KC Tenants advocacy group filled council chambers Wednesday to protest changes to the city’s housing and incentive policies.
Lucas unveiled a legislative package last week that would relax recent rules that require most residential development projects seeking city incentives to set aside a certain share of new units designated as affordable.
The proposal would also fundamentally change the approval process for tax-incentive projects by allowing the city manager to approve them rather than the city council and economic development boards that now exercise oversight.
A committee approved part of the package on Wednesday, forwarding it to the full city council for consideration. This piece aims to roll back from an ordinance enacted in 2021 that requires one-fifth of units in most taxpayer-subsidized apartment buildings to be affordable. Half of these must be affordable for families earning 70% of the region’s median income and the other half for those earning 30%.
Last week’s proposal would change that. In exchange for incentives, developers would set aside a fifth of their units for those earning 60% of the region’s median income.
At this rate, the city would consider a one-bedroom apartment that costs $1,172 a month affordable for a single person.
Opponents say those numbers are unrealistic for working-class renters.
Lucas is pushing for change because he says the 2021 rules just don’t work.
Kansas City’s Economic Development Corporation saw an influx of requests for incentives in the months before the new rules were implemented. But he hasn’t seen any applications for projects with incentives that fall under affordability rules since.
“Unfortunately, since that time we haven’t seen unit production,” Lucas said Wednesday.
But critics say the mayor is giving up too soon.
Developers rushed in 31 applications for incentives for multi-family projects in 2021 before the new rules took effect. Only eight applications had been received in the previous three years, said Geoff Jolley, executive director of Local Initiatives Support Corp., a nonprofit community development group.
Jolley said those projects are still in various stages of development. With so many projects in the pipeline, the policy hasn’t really been tested yet, he said.
“We are prematurely revising an order that hasn’t even had time to come into effect yet,” he said.
Jolley worked on a committee of community members and developers who have been studying the city’s incentive policies for months. At first, developers were reluctant to book affordable housing because there was no dedicated funding to help developers build affordable housing. Now the city has an affordable housing trust fund, but developers have not attempted to access it, he said.
“We created the mechanism and they don’t want to use it,” Jolley said.
Last month, the city made its first allocations from the housing trust fund. It plans to spend $8 million on 14 affordable housing projects undertaken by nonprofits and neighborhood groups.
Councilman Dan Fowler, who represents the city’s 2nd Ward, defended private developers, who he says can’t make money under the city’s current affordability rules.
“The thing is, developers are in this business to make money,” he said. “I don’t blame them. Few of us would go to work if we weren’t paid.
The mayor’s plans have faced opposition from local tax jurisdictions who bear the brunt of development tax breaks and from KC tenants, who say the proposals undermine the city’s commitment to creating truly affordable housing for the most vulnerable tenants.
“This ordinance does nothing to create affordable housing in Kansas City. All of this just creates profits for the promoters,” said Mary Allison Joseph, a staff member at Trinity United Methodist Church in Midtown and a member of KC Tenants.
KC Tenants says the city’s definition of affordability is out of whack because the numbers used are inflated. The median area income set by the federal government on which the city is based is the average income of homeowners and renters in the metropolitan area, in rich and poor areas. A better yardstick would be Kansas City’s average renter income, according to the group.
“1200 per month for a 1 bedroom apartment? They are crazy,” said Sabrina Davis, a leader of the tenant advocacy group, on a media call Tuesday opposing the mayor’s plans.
In pushing for policy change, Lucas has publicly referenced his family members, including his mother, who have struggled to find affordable housing. He said he wanted to see affordable options across the city, not concentrated in a few areas.
But critics say it’s unclear what population the mayor’s new threshold would serve – or even if there’s a need at those levels.
A family of three earning around $53,000 a year, for example, would qualify for a subsidized two-bedroom apartment that rents for $1,319 a month.
Kansas City Public Schools has asked the mayor to put his proposal on hold until his board can consider the implications. School leaders have for years been asking for more influence over how city officials give incentives to developers, which can rob schools of potential future property tax revenue.
KCPS tracked a spike in the number of approved incentives within its boundaries. The school system says the amount of property tax abatements increased by 60% between 2017 and 2020. Officials estimate that developer incentives cost schools $37 million in 2021.
The school system also fell short of the affordability threshold proposed by the mayor.
“KCPS teachers have some of the highest starting salaries in the Metro,” said Kathleen Pointer, senior policy strategist for the school system. “And $1,200 for a bedroom is unaffordable to them, as it is to many city workers.”