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Editorial: Iowa City needs to act on affordable housing

BY DI EDITORIAL BOARD | OCTOBER 03, 2014 5:00 AM

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One of the most contentious issues in Johnson County over the past several years has been action (or lack thereof) on affordable housing. In Iowa City, the use of TIF funds for the high-rise Chauncey building brought the topic to the forefront of civic discussion. Should the city invest in areas lacking affordable housing or take a more general approach in using the funds for economic development?

It’s a question that ultimately comes down to the demand of the housing market and how much the city and county are willing to adjust the grasp of its “invisible hand.”

Regardless of the reasons behind it, the need for affordable housing has certainly received its share of recognition locally. On Thursday, participants of an Iowa Valley Habitat for Humanity workshop discussed the need for affordable housing throughout Iowa City and Johnson County.

The workshop was no isolated event. It received a wide array of sponsors, from the cities of Iowa City and Coralville to Hills Bank and Trust, as well as a host of churches and other religious institutions. The message is clear: Affordable housing is an issue worth investing in.

Johnson County’s local rental vacancy rate is only 0.5 percent, and the county’s renters are the most cost-burdened in the state, according to the University of Iowa Public Policy Center. The definition of cost-burdened is spending more than 30 percent of one’s monthly income on housing, a category that between 53 and 67 percent of Johnson County renters fall into. Currently, there are more than 2,000 residences paying more than 50 percent of their income on housing.

Michael Bodaken, the president of the National Housing Trust, said assistance from the federal government has not been able to offset the need. “For every new [affordable housing] unit in Johnson County, we lose two,” he said.

The supply of affordable housing simply isn’t there, and the demand is certainly high. The overriding economic conditions in the county have created an affordable-housing shortage, in large part because the meaning of “affordable” has not remained the same.

From 2000-12, housing values in Johnson County rose a value of 15.6 percent, but the median income decreased by 7 percent during the same period. The number of people in poverty in Johnson County has increased, too, with 8 percent of families in poverty, along with 17.6 percent of individuals.

But even with dire numbers such as these, local governing bodies aren’t bereft of solutions. One option discussed at the workshop is the Low-Income Housing Tax Credit, which uses tax policy to help develop affordable rental houses. This can go hand in hand with TIF funding.

With the problem of affordable housing in Johnson County becoming exacerbated in recent years, its apparent the market is not acting to solve the issue on its own. Through the use of tax funding, the city and county can create incentives to develop more affordable housing, and the Daily Iowan Editorial Board urges them to do so.


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