The board of Pittsburgh’s Urban Redevelopment Authority approved a new program Thursday that seeks to protect existing affordable rental housing in the city.
Under the Housing Preservation Program, the URA will be able to loan money to developers, both non- and for-profit, who want to buy and rehabilitate affordable units.
A 2016 report found that Pittsburgh had a shortfall of more than 16,000 units of affordable housing — a number that has only grown in the intervening years. While it’s important to build new affordable housing, policy makers, residents, and advocates (in particular, Pittsburgh’s Preservation Working Group) have long stressed the need to create new ways to preserve the affordable homes that already exist.
URA board member and state Rep. Sara Innamorato applauded the program, calling it a smart use of funds.
“I know … how expensive it’s becoming to put the shovel in the ground,” she said. “Using these dollars, we’re getting a significant return on investment in preserving the existing structures.”
In a report to the URA board, staff described the supply of housing as “rapidly aging,” and “at risk of becoming market rate.” A particular concern is the expiration date of restrictions on subsidized apartments, which requires homes to be rented at affordable prices for a set period of years. Once that period ends, owners can either redevelop the buildings or sell them to the highest bidder: Either process can lead to higher rents or the loss of units entirely.
One high-profile example of the latter phenomenon was the redevelopment of the Penn Plaza Apartments in East Liberty. More than 100 units of housing had degraded and were ultimately demolished.
Nearly $9 million of federal pandemic relief money will be used to fund the Housing Preservation Program. Only projects of five or more units will be eligible, and loans will be capped at $1.5 million.
The URA’s guidelines state that at least half of the final units must be available to people who make 80% or less of the area median income, or AMI, and that priority will be given to projects that are affordable at half the AMI. Developers must commit to keeping the units affordable for 40 years.
