Ferndale Outlines Ways to Improve Affordable and Inclusive Housing
(Drew Saunders, Aug. 31, 2020)
Ferndale, MI -The City of Ferndale is moving forward with plans to address affordable housing in the city, accepting the Community Affordability And Inclusive Housing Action Plan, which is expected to be included in the next Master Plan update.
“The data proves we have changing demographics. Stagnant housing does not respond to the needs of the community and I think this gets us moving in the right direction,” Ferndale Mayor Melanie Piana said.
LSA Planning compiled the report, which found that Ferndale is increasingly attracting more people who live alone, than families. There is need for both owner-occupied homes and rental units, at a range of costs so that even those who work locally can afford to live here.
LSA found over that two-thirds of residents thought that there was not “sufficient housing options for individuals and families of all economic backgrounds” in the city. Indeed, they found that a quarter of Ferndale residents spent more than 30 percent of their incomes on housing, which was the definition of being burdened by the cost of housing.
They came to their conclusions through a community survey, focus groups, a community meeting last February and six advisory group meetings held since last September, which helped form the plan that was presented August 24.
To improve housing inclusivity, LSA recommended several options to the council.
The CAIHAP recommends allowing the transition of single family homes into multi-family unit buildings like duplexes and triplexes. This is an easy way to increase the number of units available, particularly when smaller, single-person spaces are needed.  It also allows homeowners to bring in revenue with their properties.
Other options included selling or leasing city-owned land for developers to build low-income housing, promote Voluntary Inclusionary Housing, adaptive reuse, a first time home buyer program and the establishment of a local housing trust fund.
With a trust fund, local funds “are critical for filling the gap between the cost of delivering market-rate housing and the cost of delivering housing at affordable prices and rents.” This would help the city leverage state and local funding tools, and gives the city more influence on new housing stock.
“When local funds are  used  to  support  affordable  housing  development,  the  City  has  more  influence  on  this  new housing stock; specifically ensuring it aligns with the housing priorities of the community” the CAIHP states. “A local source of funding, other affordable housing initiatives (e.g., adaptive reuse, density bonus) will not be as successful as they could be. In addition, a local housing trust fund provides a lot of flexibility for the City on how funds can be used, whether it be for gap-financing, home rehabilitation, down payment assistance, renter resources, etc.”
Voluntary Inclusionary Housing is a cocktail of incentives to include a set percentage of affordable housing in a market-rate housing development, through changing density and parking regulations in exchange for a certain number of affordably-priced residential units.
In Ferndale, this is already on the books. If a development is built on city land with more than 25 units, then a quarter of the units have to be for affordable housing. How are the units are priced depends on household income, according to the CAIHAP. The CAIHAP recommended modifying it by expanding where this type of housing can be done, include buildings with four or more units and by changing layout and affordability criteria.
Giving homeowners the ability to improve their properties through “no and low-interest loans” or grant programs is another strategy. The CAIHAP recommends that these federal funds are most effective for people making up to four-fifths of the Area Median Income, a measure of the wealth demographics of a given area.
“Funding for single-family rehabilitation programs can come from several sources, including the federal CDBG [Community Development Block Grants] and HOME programs, administered by Oakland County that can loan as much as $18,000. The state’s Housing Development Authority repair program also provides loans of up to $25,000,” The CAIHAP said.
Another strategy – adaptive reuse – is exactly what it sounds like, converting commercial or industrial buildings into residential buildings. The CAIHAP suggested that buildings nearest transit “corridors” along Woodward Avenue and 9 Mile Road would be ideal.
First time home-buyer programs use subsidizes the loans of low or mid-income households through a variety of federal and non-profit housing efforts, to expand the pool of homeowners across tax brackets. The CAIHAP suggested multiple state and Oakland County programs available, as well as non-profit affordable housing ventures like Venture Inc; Habitat for Humanity of Oakland County and programs through DTE Energy.
A Local Housing Trust fund is simply a pool of money generated by any number of funding sources to preserve or subsidize low-income housing. The CAIHAP suggested that having a locally funded source would give the city more “leverage” over what affordable housing would actually look like, and  that it would likely generate more income.
The last proposal, Payment-in-Lieu of Taxes, in-which a property owner agrees to pay a fine instead of taxes, which is about fifty percent of what the tax would normally be, in exchange for the development of affordable housing units. This would be for a set number of years, and not be permanent.
“It won’t happen overnight. We need partners in the county, state, the federal government – a federal government that doesn’t remove federal housing regulations to make sure people have access to affordable housing,” which Mayor Piana said would hurt Ferndale.
Not only does having a variety of housing options help keep Ferndale a vibrant, economically stable community for all, it also helps right some of the racial injustices of the past.
Councilwoman Kat Burner-James said that single family housing, along with red lining, were “powerful tools in the segregating that exists today” and that it would “take some serious work and attention to undo that. This is a step forward in implementing and bringing to life our commitment to anti-racism.”
Strategic planning for the city begins soon, providing even more opportunities for the public to weigh in on these ideas.
“With our strategic planning session coming up in just a few weeks, there will be more opportunity to discuss how we would like to further implement this plan going forward. It is a living document that can be altered as we go,” Mayor Pro Tem Raylon Leaks-May said.
The City of Ferndale’s affordable housing efforts are distinct from the Ferndale Housing Commission, which is an independent organization that primarily uses funding from the Federal Department of Housing and Urban Development (HUD) to maintain public housing.  They too are going through a transformation as they explore partnerships that would allow them to reorganize their properties to add more low-cost rental units while also shoring up the resources to make improvements to the properties that need them.  The FHC is separate from the city, but the efforts and the goals are the same – ensuring that Ferndale is a community for everyone regardless of income levels.
For more information, view the Community Affordability and Inclusive Housing Action Plan