Tempe’s affordable housing initiative
Feb. 16, 2022
In January 2021, Tempe approved a new initiative to keep housing prices affordable in the city. January marks a year since Tempe established Hometown for All, which created a dedicated funding stream to support affordable and workforce housing in Tempe. To date, the initiative has raised approximately $6 million to support affordable housing. We talked with Tempe Mayor Corey Woods.
According to the 2019 Tempe Affordable Housing Strategy, 11 thousand new housing units will be required by 2040 just to maintain current levels of availability.
A “personal passion” of the mayor, according to Woods himself, the program is rather unusual in that it does not use any of the most common methods to increase the supply of affordable housing, largely because many of those have been banned by the Arizona legislature.
“49 out of 50 states have something they call tax increment financing, which is used to many times address blighted areas and build affordable housing. We are the one state where we don’t have that tool. Rent control is something that they have in many states across the country. We don’t have that tool,” Woods said. “The Hometown for All program was frankly a response to that. It was trying to find a way, despite some of the legislative preemptions to make sure we could find a way to get to those 11 thousand units by 2040.”
Instead, the program directly purchases land, or remediates lots already owned by the city, before partnering with affordable housing developers to construct new dwellings.
The money for the program comes from several different sources. 50% of certain permitting fees are directed into the program, as well as profit from public land sales. A sizeable portion, however, comes from voluntary contributions from developers themselves.
According to Woods, the response has been “extremely overwhelming.”
“I think they’re very happy to contribute to getting more affordable housing in our community, but have some structure and some certainly around the process,” Woods said.
One part of this structure is a set of standards passed by the Tempe City Council, specifically defining what qualifies as affordable or workforce housing, terms that are defined in many different ways by different organizations.
“One of our concerns is, with developers frankly now knowing that we really care about this, we didn’t want them coming to us and just saying something was workforce or saying something was affordable without someone being able to be the arbiter for that,” Woods said
One of the most significant barriers to most affordable housing initiatives, local opposition by residents who don’t want the housing built in their own neighborhood, has not been a significant issue, Woods said.
“It’s something supported by the vast majority of our residents, so that makes it lot easier,” Woods said.