Efforts to create deeply affordable housing to meet the needs of Arlington’s lowest-earning residents face significant headwinds, according to a recent presentation to the Arlington Planning Commission.
Most current efforts around affordable housing focus on households with incomes of at least 60% of the area median income (AMI) — leaving out a large swath of people earning less.
Making housing available to those below the 60% AMI threshold is “an issue that has been very important to this commission,” Planning Commission chair Tenley Peterson said during a Monday presentation.
“We often see affordable housing provided at 60% of AMI, and we know that it is very important that it be available at 30%,” she said.
The current area median income in Arlington is about $164,000 for a family of four, but households earning 30% of the AMI have a total income of less than $49,000. Housing guidelines seek to have people pay less than a third of their income in housing costs.
“Creating units available at the 30% AMI level can be really challenging to finance and hard to support during property operations,” said Anne Venezia, the county’s housing director.
She laid out the challenges on multiple fronts:
- For developers, having more units focused on lower-income residents makes it difficult to meet annual operating costs, which in Arlington now average nearly $11,000 per apartment unit even before taxes and borrowing costs are factored in. Units rented to those at 30% AMI “barely pay for themselves,” Venezia said.
- For the county government, subsidizing the construction of apartments affordable to those earning 30% of AMI can cost up to $180,000 more per unit than for those to be rented to those in the 60% category. That, in turn, reduces the number of units that can be supported by the county’s Affordable Housing Investment Fund (AHIF).
Trying to turn existing 60% AMI affordable units into 30% units “can be even more challenging,” Venezia said.
As a result, Arlington currently has a gap of about 8,000 units that county leaders want to see available to the 30% income group. If there is any silver lining, recent data-gathering efforts suggest that while the gap is not shrinking, it isn’t significantly growing, either.
Venezia, who has been housing director since 2020, said the county government is not abandoning the effort to create units serving the lowest income groups.
“We are still interested in doing this, and we try to maximize these units when and where we can,” she said.
County officials try to support the 30% AMI income group in various ways, county housing officials said, including providing direct housing grants for those in market-rate units and supporting eviction-prevention efforts.
Those initiatives have limits, too. The county government currently has no funds available for emergency rent and utilities assistance, with new applications on hold until Nov. 1.
There was no formal action for the Planning Commission to take coming out of the presentation. Commission member Tony Striner said it “gave us all a better understanding” of the challenges involved.
The discussion ultimately turned to the question of whether Arlington’s development process is too convoluted and uncertain for developers, when compared to those in surrounding Northern Virginia localities.
“I’ve heard, and I don’t know how true it is, that developers prefer those systems [elsewhere] because there’s more certainty up front — they know what they’re going to be dealing with,” Commission member James Lantelme said of regional competitiveness.
In contrast, “ours is fairly opaque, and no developer going in with a new project really knows how it is going to come out on the other side,” Lantelme said.
In Arlington, developers seeking increased density or other zoning changes often must complete what can be a long process to determine what community benefits local leaders will seek in exchange. Committed-affordable housing has to compete with transportation and several other priorities in that process.
Lantelme wondered whether Fairfax, Falls Church and Alexandria might be getting new development that Arlington should have.
“Our location is certainly better than theirs, but are we putting up roadblocks?” he asked. “The more development, the more housing we would get — and we want housing.”
The discussion came as members of another advisory panel — the Housing Commission — are asking County Board members to press the General Assembly for additional local powers to create affordable housing.
While supportive of more local powers, Board members have been wary of mandates from Richmond that would remove local regulatory power over land-use decisions.
