Friday, Nov. 26, 2004 | 11:11 a.m.
It's been more than eight months since the Bureau of Land Management put procedures in place to make land available at discounted rates for affordable housing.
But no local entity has yet taken advantage of the program.
The idea looks good on paper: Release land at below-market value -- in some cases discounting by as much as 95 percent -- to local governmental entities, including housing authorities, so affordable housing can be built.
It's a simple idea that becomes a not-so-simple proposition when federal and local governments and the business world intersect.
The provision for affordable housing is in the Southern Nevada Public Lands Management Act of 1998. That section provides that land can be released -- at reduced prices -- to jurisdictions statewide for affordable housing. The BLM and Department of Housing and Urban Development have worked for years on how to actually facilitate the release of land for that use and finally came up with guidelines in April.
But officials with the local cities, the county and their housing authorities said while promising, there are still more details that need to be worked out and elements of the program just end up raising more confusion. Officials with some of the entities said they have no interest in the program at all and feel local governments shouldn't have to buy the land.
The need for affordable housing has become more acute in the past couple months as the prices of valley homes have skyrocketed. A recent study by Hanley Wood Market Intelligence indicated that only 24 percent of people in the Las Vegas Valley could afford a new home and almost 41 percent of Las Vegans had the ability to buy a resale home in the second quarter of this year.
That's compared with 48.5 percent of Las Vegans who could afford a new home and 60 percent who could afford an existing home in the second quarter of 2003.
Merv Boyd, assistant field manager of land sales and acquisitions at BLM, acknowledged that the land program is a complicated process and there are still some questions that need to be worked out.
"It's not because they are not working on it. It's complicated and it takes time to go through the process," Boyd said.
Under the guidelines, the process starts with a city or county government or local public housing authority that identifies land that could be used for affordable housing. Among the materials they must submit to the BLM is a package of information that describes the affordable housing project, which can be for-rent or for-sale multi- or single-family housing, a description of the target population, and construction schedule.
The type and scope of the project depends on how much the land will be discounted.
The affordable housing would be made available to families whose incomes do not exceed 80 percent of the median income for the area, with adjustments for smaller and larger families. However, there is a provision that the Secretary of Housing and Urban Development can establish income ceilings higher or lower than 80 percent of the median income for the area because of prevailing levels of construction costs, area rents or unusually high or low family incomes.
Cities, counties and their housing authorities can either build the project themselves or partner with a nonprofit entity or for-profit developer, Boyd said.
For now the city of North Las Vegas and its housing authority and the city of Henderson will not be taking part in the program.
"I attended the early sessions, but I was so disgusted I stopped going," said Don England, chief executive of the Housing Authority of the city of North Las Vegas. "The BLM in my estimation is strictly trying to make a profit off the land and they are not interested in affordable housing any more than the man on the moon."
Gregory Rose, North Las Vegas city manager, said no one has come to the city with "an express interest in affordable housing" on BLM land.
England said unless there are subsidies from other sources, he does not believe affordable housing will be attainable at today's land prices, even if the land is discounted.
Appraised land prices at the last BLM auction, held in June, ranged from $62,000 an acre to $396,000 an acre. Most of the 71 parcels sold at that auction sold for double their appraised value.
The city of Henderson, which has long been looking for ways to help its residents obtain housing, also has no immediate plans to take part in the land-for-affordable housing program.
"The formula and the process they put into place doesn't work for us," Skeet Fitzgerald, director of Henderson's Neighborhood Services division, said. "We really want to have affordable housing throughout the community so as not to create future pockets of poverty."
Doug Kuntz, Henderson's affordable housing coordinator the city is still interested in some form of inclusionary zoning, which would strive to mix different income levels and housing products within a neighborhood.
The BLM plan does allow for a mix of affordable and market-rate homes, but the percentage allotted to affordable houses would help determine the end price of the land.
Kuntz said the city thinks the land will still be too expensive, even at somewhat reduced prices, to make affordable housing work.
"I brought up paying $1 an acre, and that wasn't favorably received by the BLM," he said. "I can understand when you make $247,000 an acre, I can see where that's a great benefit to them. But we're all going to pay if we're not able to do something."
Douglas Bell, Clark County Community Resources Management manager, said the county is interested in the program but questions the thinking behind having to purchase the land.
"Why does the government have to pay the BLM for that land?" he said. "If local governments are expected to buy land, it's an inordinate burden to own and control that land."
While Kuntz said his $1-an-acre idea was scoffed at, the BLM has given away land in the past for affordable housing uses.
Under the Clark County Conservations Public Land and Natural Resources Act of 2002, land was provided to the city of Las Vegas for a 90-unit affordable senior assisted-living center.
Prior to the BLM policies being set in April, there were about 750 acres identified throughout the Las Vegas Valley for affordable housing uses, Boyd said. While the law doesn't allow for reservations of land, the BLM has honored the requests of local municipalities and housing authorities interested in the program to hold off on selling that land until its decided whether or not it will be used for affordable housing, he said.
Betsy Fretwell, deputy city manager with the city of Las Vegas, said the city is looking into the possibility of affordable housing on 41 BLM-owned parcels throughout its jurisdiction.
"We are actively developing a process right now to make that affordable housing provision spring to life," she said.
Fretwell said the city envisions a mix of multifamily and single-family housing, but it is too soon know exactly what the affordable neighborhoods might look like.
There are issues that still need to be worked out, but Fretwell said despite those concerns the city is trying to move forward with the program.
"You never know until you try," she said. "If we can't make it work, then we'll go back and tweak the regulations this way or that way. We're hoping we'll be successful right out of the gate."
Clark County is very interested in the program but has yet to adopt any formal policies at the county level so that it can take part.
Bell said his staff is working with the county's Comprehensive Planning department to find parcels to reserve for consideration in the future.
Bell said an important part of making the program work is making the entire process easy and affordable for the governments and its partners to develop.
"Time is money to them. We can't afford for it to take 10 years; we won't have developers show up at the table," he said.
Bell said prepackaging of land, zoning and financing should be in place so developers can move forward on the projects. Another issue that could complicate things is the social services and schools that may be needed if new communities are built, he said.
"Building affordable housing is anything but an easy task."
Bell said there are some questions, such as how deals can be structured, that still need to be worked out.
In an attempt to make the process easier, Ken LoBene, HUD field office director, said he has been meeting with local housing authorities to explain the program and help start the process. It is also meeting with the BLM to work through questions that have arisen. HUD will also work with the BLM to review the projects once they are proposed.
"We met with the Las Vegas housing authority and gave them a presentation and let them know we can provide technical assistance all the way through the process," LoBene said.
Officials with the Clark County and Las Vegas housing authorities said they are very interested in the BLM program.
Parviz Ghadiri, executive director of the city of Las Vegas housing authority, said his group is going to apply for lands and is looking into different ways to fund projects.
"We're going to do it, definitely," Ghadiri said. "Especially after the price of housing has escalated; we need more affordable housing, no question whatsoever."
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