City‐level housing trust funds: Lessons from key case studies

Abstract

AbstractThe United States needs more housing. The need for the creation of new housing and rehabilitation of existing housing stock at price points that middle‐ and working‐class families can afford has created a pent‐up demand revealed in housing assessment reports across the country. Housing trust funds have been increasingly used as one tool among other efforts to meet this proven need for more affordable housing (affordable housing is understood to mean paying less than 30% of household income on housing costs, otherwise stated as the 30% of income affordability threshold). This paper explores this important tool, overviewing crucial information needed by scholars of affordable housing as well as policymakers, housing advocates, and other stakeholders to understand and act in the use of this vehicle to support affordable housing. Little research exists on understanding the way housing trust funds are constructed and used looking across specific funds. There exists an even greater gap in investigation of the efforts of housing trust funds at local levels. Thus, this paper examines housing trust funds in a comparative manner and does so using city‐level, as opposed to state or federal‐level, funds. There exist key lessons that can be learned from cities around the country that are already engaged in such work. There are three crucial aspects that define successful housing trust funds: funds must be rooted in empirical data on housing needs and feasibility, supported by a dedicated revenue stream drawing ideally from multiple sources is indispensable and management of the fund should be established in context with other efforts at providing and retaining housing at affordable prices. The combination of housing trust fund dollars with other efforts, made stable by dedicated sources of revenue and ongoing research makes them a tool that is a successful addition to work done on supplying the demand for housing at needed price points.