More funds for housing much needed
By Jody Sullivan
One of the many activities of the Newport County Chamber of Commerce is to monitor the legislative session on behalf of our businesses and our communities. Understanding how the budget and proposed legislation will impact economic growth is important to our members.
While affordable housing may not immediately seem a topic of interest and importance to the business community, it plays a key role in the overall economic health of our community and our state.
The business community understands the necessity of having a quality stock of affordable homes for the work force. A sufficient supply of affordable housing ensures that people can live in the communities where they work, helping local economies. The rate of pay for many jobs in Newport County and Rhode Island makes it impossible to afford the average price of rent in the communities where these job opportunities exist. In Newport, for example, the average price for a two-bedroom rental is $1,311. That is $521 more a month than the average private- sector wage, causing many Rhode Island workers to live in neighboring Massachu-setts, taking their wages — and purchasing power — with them.
For the past four years, Rhode Island has been working toward increasing the supply of affordable housing, with all the accompanying economic benefits. In 2006, voters overwhelmingly passed a $50 million affordable housing bond to be disbursed at $12.5 million a year over the course of four years. The bond, also known as Building Homes Rhode Island, resulted in the development of 171 affordable apartments and nine affordable home ownership opportunities in Newport County alone. Overall, the program helped to create more than 1,300 long-term affordable homes in 30 of the state’s 39 communities — some 300 more than originally anticipated.
The program is providing quality homes for low-wage workers, individuals with disabilities, young working families, the formerly homeless, veterans and the elderly. But more than that, Building Homes Rhode Island has helped area businesses, communities and the state’s economy overall.
HousingWorks RI conducted an economic analysis of Building Homes Rhode Island using IMPLAN, an input-output economic modeling tool used by 40 states to measure the economic impact of various industries. The analysis found that:
? The $50 million disbursed at $12.5 million a year over four years has multiplied nearly 16 times throughout the state economy, generating about $800 million in total economic activity.
? Construction activity supported by Building Homes Rhode Island dollars accounted for nearly 60 percent of the total estimated cost of residential construction permitted in Rhode Island from 2007 through 2010 — a lifeline for our construction sector when it most needed it.
? At a time of record-high unemployment numbers, Building Homes Rhode Island supported 6,100 jobs in Rhode Island, generating nearly $300 million in wages.
The homes developed through Building Homes Rhode Island are just one part of the continuum of affordable home choices needed throughout the state. The Neighborhood Opportunities Program is a unique, statefunded program that was designed to provide homes for low-wage working families and individuals with disabilities. Program funding allows rents to be set at a level that is both affordable for renters and sustainable for owners.
Senate President M. Teresa Paiva Weed, D-Newport, has in the past championed the program as it provides funds to cover the difference between the rental costs affordable to very low-wage Rhode Islanders and the cost to owners of operating the rental units.
Working together, Building Homes Rhode Island and the Neighborhood Opportunities Program can provide a full continuum of housing options for Rhode Islanders, but only if the state maintains its investment in these proven programs.
The funds from the housing bond passed in 2006 have been fully spent, but Gov. Lincoln D. Chafee included a $25 million housing bond in his budget for fiscal 2013. We encourage the General Assembly to move this measure forward to voters in November to ensure the state can maintain the momentum of Building Homes Rhode Island. The Senate has been very supportive of the creation of new affordable housing units and once again Sen. Weed will be advocating for inclusion of a housing bond in the fiscal 2013 budget. We greatly appreciate the continued support of the Senate president.
This affordable housing bond could be a part of a comprehensive housing policy enacted and funded by the state. Our economy needs this investment. Our neighboring states of Massachusetts and Connecticut have increased such investments as a driver for economic growth and Rhode Island must do the same.
Jody Sullivan is the executive director of the Newport County Chamber of Commerce.
Copyright © 2012 Edward A. Sherman Publishing Co. 05/29/2012