The need for affordable housing is increasingly prevalent in Wisconsin. Data suggests that poverty has been on the rise over the last 30 years while wages have stagnated or decreased. With rising housing costs, especially in new construction, securing affordable housing across the state is more important than ever.
Broad reforms to how Wisconsin addresses affordable housing are necessary for the long-term success of the programs. Creating a formalized incentive and repercussion structure to encourage cooperation and consolidation of planning and implementation across the state would also be a relatively inexpensive start.
I’ve written before that one of the largest challenges public housing authorities confront is positioning new affordable housing stock, especially in larger metro areas. Typically, the developers and municipalities juggle the often competing goals of building units affordably, placed in proximity to amenities like transit, parks and garnering neighborhood support. Due to federal regulations requiring local support for projects, a “Not in my backyard” attitude plagues affordable housing developments, as evidenced in Madison’s continued fight over downtown housing and the homeless day shelter.
A large detriment to successfully placing affordable housing is that federal law currently allows each community to establish its own public housing authority and some municipalities develop a public housing authority for the sole purpose of preventing public housing from materializing. While communities can be a great resource for identifying and solving local housing problems, other communities — particularly affluent suburbs — created public housing authorities with the intent to obstruct potential construction.
California has developed a substantial and effective response to this fragmentation in a formalized Regional Housing Need Allocation process. According to California state law, each local government in California must incorporate a “Housing Element” as part of their general plan, which includes a statement on how the community plans to meet the forecasted housing needs for each income level. This ensures that planners look ahead to future needs and put into words how they can provide affordable housing for all income levels including the very poor and very wealthy. Even the most obstinate and unwilling communities incorporate affordable housing into their planning at some level.
If these communities still are unwilling or unable to actually incorporate the affordable housing they allocated, a community can “buy” the opportunity to give excess affordable housing units to neighboring communities. This “cap and trade” system of housing allows communities who welcome affordable housing development to gain a financial incentive to build. Communities who oppose development must pay a penalty for not paying their share of the regional needs.
Why can’t we do this in Wisconsin?
To combat increasing fragmentation of resources, I propose Wisconsin develop a program to mimic California’s regional quota based system that could be layered onto existing affordable housing organizations — potentially public housing authorities or even simply county boards — for minimal disruption.
This approach has several advantages, including an existing framework for success and established best practices. Additionally, the formerly obstructionist communities would still have recourse in the new system to not build affordable housing if they do not wish to pay through neighboring communities to take their housing stock. Verona could spend money to continue rejecting affordable multi-family building apartments and Madison could use that additional funding to better support homeless support systems.
There are a few drawbacks with this program, mostly in the logistical and oversight areas. The Department of Administration, which houses the state-level housing administration in Wisconsin, would need to create rules for how the demographic forecasting is conducted as well as rules for how the local entities must comply. Additionally, there would need to be procedures for following up and approving the housing plans once they are drafted and a monitoring mechanism would need to be created to ensure compliance or to collect fees for non-compliance.
To combat these additional costs, it may make more sense to pilot this program in a few select areas like Dane County, Brown County or Milwaukee County and develop some Wisconsin-specific best practices for growing the program.
Housing is an enduring and pervasive problem that cannot be fixed through one or two reforms alone. But, by mandating that all municipalities take forecasted need into account and prepare a plan to address those needs, it will help local administrators achieve better results.
Adam Johnson ([email protected]) is a master’s candidate at the La Follette School of Public Affairs.