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DALLAS, TEXAS

Affordable Housing and Mixed-Income Strategies


A ULI Advisory Services Panel
FEBRUARY 28 - MARCH 4, 2016

Dallas Texas
March 2016

About the Urban Land Institute

The mission of the Urban Land Institute is to provide


leadership in the responsible use of land and in
creating and sustaining thriving communities
worldwide.

ULI is a membership organization with nearly 40,000


members, worldwide representing the spectrum of
real estate development, land use planning and
financial disciplines, working in private enterprise and
public service.

What We Do:
Conduct Research
Provide a forum for sharing of best practices
Write, edit and publish books and magazines
Organize and conduct meetings
Direct outreach programs
Conduct Advisory Services Panels
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The Advisory Services Program


Since 1947

Dallas Texas
March 2016

15 - 20 panels a year on a variety of land


use subjects
Provides independent, objective candid
advice on important land use and real
estate issues
Process
Review background materials
Receive a sponsor presentation &
tour
Conduct stakeholder interviews
Consider data, frame issues and
write recommendations

Make presentation
Produce a final report
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Dallas Texas
March 2016

The Panel
Chair

Philip Payne
Principal and CEO, Ginkgo Residential
Charlotte, North Carolina

Tony M. Salazar
President - West Coast Division
McCormack Baron Salazar
Los Angeles, California

Meaghan Shannon-Vlkovic
Vice President and Market Leader, Enterprise
Community Partners
Atlanta, Georgia

Panelists
Kent Collins
Principal, Centro Development, LLC
Austin, Texas
Nancy Montoya
Principal, TTA
New Orleans, Louisiana
Dionne Nelson
Principal and Chief Executive Officer
Laurel Street Residential
Charlotte, North Carolina

Mark Shelburne
Senior Manager, Novogradac & Company LLC
Raleigh, North Carolina
Jake Wegmann
Assistant Professor, Community and Regional
Planning Program, University of Texas at Austin
Austin, Texas
Roger L. Williams
Principal, RW & Associates, LLC
Potomac, Maryland
Stockton Williams
Executive Director, Terwilliger Center for Housing
ULI-the Urban Land Institute
Washington, DC

Sponsor
City of Dallas

Dallas Texas
March 2016

Mayor and City Council


Karl Zavitkovsky

Bernadette Mitchell
Heather Lepeska
Timothy Glass

Thanks to the more 70 individuals for participating in the


ULI Panel interview process.

The Assignment

Dallas Texas
March 2016

The City asked the Urban Land Institute to assemble a panel of housing,
land use and economic development experts to:
Interview stakeholder groups identified by the City and ULI;
Review the Citys existing housing policies and practices;
Review best practices of other municipalities related to the
development of affordable and mixed-income housing; and
Present to the Housing Committee suggested policies and practices
for inclusion in the Citys new housing policy.

Dallas Texas
March 2016

Dallas Texas
March 2016

Summary of Major Recommendations

Muster the political will to address the affordable housing crisis


Create a Chief Executive Officer of Housing and Community
Investment
Create a Housing Trust Fund with dedicated revenue sources
Identify a limited number of housing and community revitalization
focus areas
Expand housing choices in high opportunity areas
Create a predictable, transparent and efficient housing policy
Citywide
Enough Planning Time to Act

Dallas Texas
March 2016

Dallas Texas
March 2016

Growing Diversity

Source:
NeighborhoodPlus
Plan, p. 8
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Dallas Texas
March 2016

Growing Diversity But Growing


Inequality of Opportunity

Source:
NeighborhoodPlus
Plan, p. 8
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Dallas Texas
March 2016

Source:
NeighborhoodPlus
Plan, p. 13

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Dallas Texas
March 2016

Source: NeighborhoodPlus Plan, p. 14

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Dallas Texas
March 2016

Dallas
City Hall

Source: NeighborhoodPlus Plan, p. 14

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Dallas Texas
March 2016

Different Neighborhoods, Different Housing


Conditions

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Different Neighborhoods, Different Housing


Conditions

Dallas Texas
March 2016

Booming multifamily construction


High-opportunity stability

Aging multifamily concentrations


Gentrification
Emergence
Working-class vibrancy
High vacancy
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Different Neighborhoods, Different Housing


Conditions

Dallas Texas
March 2016

Booming multifamily construction


High-opportunity stability

Aging multifamily concentrations


Gentrification
Emergence
Working-class vibrancy
High vacancy
Source: Jake Wegmann

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Different Neighborhoods, Different Housing


Conditions

Dallas Texas
March 2016

Booming multifamily construction


High-opportunity stability

Aging multifamily concentrations


Gentrification
Emergence
Working-class vibrancy
High vacancy
Source: Google Maps Streetview

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Different Neighborhoods, Different Housing


Conditions

Dallas Texas
March 2016

Booming multifamily construction


High-opportunity stability

Aging multifamily concentrations


Gentrification
Emergence
Working-class vibrancy
High vacancy
Source: Google Maps Streetview

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Project-By-Project Development Approvals

Source: www.dallascityhall.com

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Dallas Texas
March 2016

Why Does This Matter?

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Dallas Texas
March 2016

Why Does This Matter?


Individual councilmembers have few political
incentives to negotiate for affordable housing within
their districts.
.

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Dallas Texas
March 2016

Why Does This Matter?


Individual councilmembers have few political
incentives to negotiate for affordable housing within
their districts.
.

Without a transparent, consistent entitlements


approval process, Dallas is missing out on
opportunities to trade upzoning for affordable
housing.
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Dallas Texas
March 2016

Why Does This Happen?

Opaque, inconsistent process for project review,


approval, and accountability

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Dallas Texas
March 2016

Why Does This Happen?

Opaque, inconsistent process for project review,


approval, and accountability
Council-manager structure of city government

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Dallas Texas
March 2016

Why Does This Happen?

Opaque, inconsistent process for project review,


approval, and accountability
Council-manager structure of city government
Two-year election cycles

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Dallas Texas
March 2016

Why Does This Happen?

Opaque, inconsistent process for project review,


approval, and accountability
Council-manager structure of city government
Two-year election cycles
Aldermanic privilege

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The Tools, Funding Mechanisms and Partners

Dallas Texas
March 2016

Maximizing and leveraging tools will be critical to successful implementation


of housing strategies. The panel heard

List of resources available to developers


Mixed-income & single family
Inform & incentivize developers

Affordable multifamily & single family preservation program


Naturally occurring affordable housing
LIHTC and other subsidized properties

Aging in place housing approaches


New construction and repair programs

Creating a flexible source of funding (i.e., Housing Trust Fund)

City and institutionally owned land = development opportunity

Inclusionary zoning or payment in lieu program for mixed-income strategies in


distressed and higher income areas.

Community engagement process is critical for success


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Tools, Funding Mechanisms and Partners

Dallas Texas
March 2016

Current toolbox includes

Multifamily mortgage finance


HUD, Fannie Mae and Freddie Mac

Low Income Housing Tax Credits (LIHTC)


9% and 4% LIHTC
Qualified Allocation Plan (QAP)

HOME Federal Funding


Gap financing, rental and mortgage assistance

Community Development Block Grant (CDBG)


Youth & senior programs, housing assistance, repairs,
mortgage assistance, homeownership, infrastructure
improvements

HUD 108 Loan Guarantee Program


Economic development, housing rehab, public facilities
and other physical development for revitalization

Lancaster Urban Village, Dallas

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Tools, Funding Mechanisms and Partners

Dallas Texas
March 2016

Current toolbox includes

New Market Tax Credits


Administered by Dallas Development Fund (under Economic Development)
Spurs economic development in underserved neighborhoods

Public Private Opportunity Fund


General Obligation Bonds (GO Bonds)
Supports economic development that creates jobs and private investment
Mixed use & residential must be reviewed on a case-by-case basis and
require 20% affordability

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Tools, Funding Mechanisms and Partners


Current toolbox includes
Tax Increment Financing (TIF)
Special purpose districts (18 of them citywide)
Supports improvements and subsidizes eligible projects within the district
Subsidy for residential requires a set aside of 20% of the units at 80% of AMI
($56,300 for a family of 4)

Land Bank Authority


Vehicle to acquire unproductive, vacant and developable lots
Properties acquired through tax lien foreclosure
Sold to nonprofits and for-profits for deed restricted resale to families earning
<= 115% AMI

Dallas Texas
March 2016

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Tools, Funding Mechanisms and Partners

Dallas Texas
March 2016

Building collaboration and capacity through partnerships will be critical for


collective impact

Partners
Dallas Housing Authority (DHA)
Dallas Independent School District (DISD)
Dallas Habitat for Humanity
The Real Estate Council (TREC)
Community Housing Development Organizations (CHDOs)
Inclusive Communities Project
Dallas Area Rapid Transit (DART)
Community and Service Organizations
For-profit developers

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Dallas Texas
March 2016

Enough Planning

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Dallas Texas
March 2016

Enough Planning Time To Act!!

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Dallas Texas
March 2016

Enough Planning Time To Act!!


Plan

Responsibility

Consolidated Plan

City Manager

NeighborhoodPlus

City Manager

GrowSouth

Mayor

Dallas Housing Authority Five-Year Plan

Dallas Housing Authority (DHA)

buildingcommunityWORKSHOP plan

City Manager

Middle-Income Housing Proposal

The Real Estate Council (TREC)


North Texas Community Development
Association

Housing For All

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Dallas Texas
March 2016

Dallas Texas
March 2016

PRINCIPLES

GO BIG
Vision
Leadership
Political Will
Innovation
Goals and Metrics

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Dallas Texas
March 2016

PRINCIPLES

GO COMPREHENSIVE
Housing Only Part of Solution
Work in Both Economically Distressed and High Opportunity
Areas
Public / Private Partnerships
Land Banking

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Dallas Texas
March 2016

PRINCIPLES

GO LONG-TERM
Commitment Beyond Terms and Cycles
Consistent and Transparent Policies and Procedures
Accountability
Data-Driven Analysis Reporting

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Dallas Texas
March 2016

PRINCIPLES

GO REGIONAL
Include the City of Dallas and Adjacent Regions in Affordable
Housing and Economic Opportunity Initiatives

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Dallas Texas
March 2016

PRINCIPLES

GO SUSTAINABLE
Financial and Economic
Environmental
Sustainable
Resilient
Healthy

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Dallas Texas
March 2016

RECOMMENDATIONS

Establish an Independent Housing and Community Investment


Task Force
Appoint a CEO to Lead the Task Force
Establish a Housing Trust Fund Financed by Dedicated Revenue
Sources
GO Bonds / Payments In Lieu / Fees / Other?
Explore Inclusionary Housing Requirements with Payments in Lieu
Pursue a Public and Institutional Land Use Strategy
Expand Housing Choice Voucher Opportunities

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Dallas Texas
March 2016

RECOMMENDATIONS
For TIF and Other City Funded Projects:
Create a Sliding Scale to Allow Affordable Units at Below 80%
AMI
Require Affordable Units or a Payment in Lieu
Require Voucher Acceptance
Use Upzoning to Create More Affordable Units
MF-1(A), MF-2(A), MV-1, MV-2 Increase Density and Height
Limitations
51A Greater Utilization of Form Based Zoning

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Dallas Texas
March 2016

Implementation: Taskforce Concept

Dallas Texas
March 2016

Independent Led by a highly-respected civic leader as Chief Executive Officer of


Housing and Community Investment
No or minimal salary
Reports to City Council and Mayor
Team includes a day-to-day manager and team of consultants from Dallas best
business and nonprofit organizations

Supported by City staff and a community stakeholder group


Urgent change agent with a data-driven approach
Goal-oriented and efficient
Work likely accomplished in approximately 18 months
Serve as a model for trust between key constituents
Brings together the various plans and recommendations for housing
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Dallas Texas
March 2016

Implementation: Taskforce Roles and Responsibilities

Set clear and transparent goals and objectives with City Council approval

Create a stakeholder group including:


Community leaders
Real estate and business community
Healthcare and education providers

Assess and recommend changes to the housing and community investment policies,
procedures and structures
Based upon data driven criteria and
Including benchmarks and measurements

Implement changes as approved by City Council

Review and approve of all housing and community development decisions prior to
presentation to City Council for approval

Success measured by a scorecard of objectives and reported quarterly


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Implementation: Taskforce Organization

Dallas Texas
March 2016

Mayor and City Council


City Manager

City Departments/Staff

Taskforce CEO
Taskforce Manager
Consultant Team

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Implementation: Improvement in Priority Areas

Identify priority neighborhoods for focused improvement

Dallas Texas
March 2016

Select based upon the existence or ability to develop major systems


At least three systems should be required
Major employers
Existing housing redevelopment
Quality school opportunities
Healthcare providers
Transit options
Major commercial/retail anchors

One priority neighborhood in core Southern Dallas recommended, such as Lancaster corridor,
Frazier, UNT@Dallas, SW center mall, Cedars or Wynnewood Village.

One priority neighborhood that builds upon the current momentum near the downtown core,
such as West Dallas, Fair Park or Bishop Arts

Plan and select catalytic projects in these areas that provide the opportunity for true
revitalization
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Implementation: Affordable Units in High Opportunity Areas


Assess current land holdings and independently acquire land for mixed-income
development in high opportunity areas

Work with other institutions/agencies to create joint development plans (e.g. DART, DISD,
Dallas County Hospital)
Obtain a memorandum of understanding between key partners for better coordination
of development activities
Success will be limited if mixed-income developments dont effectively leverage
transportation, education and healthcare

Increase the placement of Housing Choice Voucher holders by leasing to a partner entity
that then subleases to voucher holders
Partner could serve as a guarantor and streamline the rental process
Program can be modeled after corporate rental program

Dallas Texas
March 2016

Engage a third party listing service for a more transparent and comprehensive tracking of
available affordable units (e.g. SocialServe.com)

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Dallas Texas
March 2016

Implementation: Housing Trust Fund

Management Options:
City/Dallas Housing Finance Corporation DHFC
Community Development Financial Institution (CDFI)
Nonprofit

Potential Funding Sources:


General Obligation Bonds
Sell approval for housing in the next bond issue
Communicate the importance through a coordinated marketing campaign
Seattle: Levy campaign
Charlotte: Chamber led campaign
Perform an outside analysis of viability of linkage fees and payment in lieu of
providing affordable units
Re-directing TIF funds from projects that opt out
Allocate a portion of CDBG or other existing City HUD allocations
Foundation and Corporate grants
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Implementation: Housing Policy Changes Quick Wins

Dallas Texas
March 2016

Explore continued opportunity to develop Low Income Housing Tax Credit (LIHTC) projects
Make written comments to Qualified Allocation Plan
Move forward existing applications for preservation projects
Work with other cities and developers with similar concerns

Establish a compliance monitoring team to track affordable units in existing and future projects
Establish appropriate affordability periods for units in city-funded projects
Identify and redeploy funds from stalled projects

Increase code inspections and review of housing stock


Develop a GIS-based system of prioritizing, documenting, monitoring and correcting code
violations

Evaluate the possible use of homestead preservation districts

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Dallas Texas
March 2016

Best Practice: Leadership and Political Will

Dallas Texas
March 2016

Housing NOLA Plan: launched 2015


Managed by Greater New Orleans Housing Alliance, in partnership with the City,
Foundation for Louisiana, local business and community leaders.
5-year goal to create 5,000 affordable units by 2021 focused on 80% AMI and
below ($48,000). New development in opportunity areas.

City has approved $16 million in current budget, approved a density bonus,
seeking state legislation to provide additional dedicated revenue.
Affordable housing is one of the top priorities of my administration, and we are
pleased that many of the Citys initiatives are reflected in Housing NOLA.
Mayor Mitch Landrieu
Takeaway for Dallas: Set bold goals, commit real money, exercise political will.

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Best Practice: Dedicated Revenue Source


Charlotte Housing Trust Fund: established 2001

Dallas Texas
March 2016

Gap financing to support development serving households earning 60% AMI and
below ($38,500).
Capitalized by a portion of proceeds from City GO bonds, backed by property taxes.
Has committed $93 million, leveraged $544 million in total development, produced
5,542 units.
Most recent bond issue (2014) passed with 60 percent of the vote two-year
campaign led by Chamber of Real Estate and Building Industry Coalition, Greater
Charlotte Apartment Association, American Airlines, and others.

Takeaway for Dallas: Include housing in the GO bond, build a coalition to make the
case to voters.

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Best Practice: Inclusionary Housing with Incentives


Palm Beach County Workforce Housing Program, established 2004

Dallas Texas
March 2016

Requires new developments to provide units serving household earning 60 120


percent AMI in exchange for additional density allowances on a sliding scale.
Developers have flexibility to meet requirements by paying an in lieu fee, building unit
offsite, or purchasing and deed-restricting market -rate units.
To date more than 1,400 affordable/workforce units approved as part of 36 developments
+ nearly $900,000 of in-lieu fees collected from 3 developments.
Palm Beach County has worked tirelessly to bring all of our housing partners to the table
in an effort to increase the availability of workforce housing in all areas of the county.
Palm Beach County Administrator Verdenia Baker
Takeaway for Dallas: Generate inclusionary development with incentives, engage the
private sector.

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Best Practice: Strategic Use of Public Land for Mixed-Income


Montgomery County (MD), since late 1980s

Dallas Texas
March 2016

Maintains a comprehensive county land inventory and has facilitated mixed-income


housing on multiple county land holdings.
All capital improvement projects or agency plans to redevelop or dispose of countyowned land are required to assess the potential for affordable housing.
County Council has passed legislation that expresses a preference for at least 30
percent affordable housing on public land.
Current sites considered for future mixed-income: new police station, former police
station, a former public fire safety- training site, and a future fire station.
Takeaway for Dallas: Seize the opportunity in land ownership to support mixed-income
development.

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Best Practice: Regional Housing Opportunity

Dallas Texas
March 2016

Chicago Regional Housing Initiative, 2011 - 2014


9 regional housing authorities manage a consolidated pool of rental assistance
available through a single application for developments in opportunity and revitalization
communities across the region.
The Metropolitan Planning Council, a regional planning organization, coordinates
application process and helps broker developments.
Initiative has provided assistance to 467 apartments in 30 developments across the
region made up of nearly 2,000 mixed-income multifamily developments
Knowing that we need low- and high-skilled labor to be able to converge around jobs,
we need people of different incomes to be able to live around the region.
Marisa Novara, Metropolitan Planning Council

Takeaway for Dallas: Regional collaboration to expand housing opportunity can work.

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Best Practice: Comprehensive Community Redevelopment


The Villages of East Lake (Atlanta), since 2001

Dallas Texas
March 2016

Mixed-income community of 1,500 market rate and affordable units.


Prior to a comprehensive redevelopment:
o 96% poverty rate,
o 90% of residents had experienced violent crime
o 5% of 5th graders met state math standards
o No new real estate investment in decades

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Best Practice: Comprehensive Community Redevelopment


The Villages of East Lake (Atlanta), since 2001

Dallas Texas
March 2016

Mixed-income community of 1,500 market rate and affordable units.


As a result of redevelopment
o Area has attracted more than $175 million in new investment
o 70 % public housing residents employed or in school or job training
o Crime down 73% violent crime down 90%
o 98% students met or exceeded state standard
Takeaway for Dallas:
Comprehensive community
development can work.

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Best Practice: Sustainable Development

Dallas Texas
March 2016

Austin S.M.A.R.T Housing Program, since 2000


Encourages accessible, mixed-income development by providing development fee
waivers and an expedited review process for developers who set aside 10% of housing
units as affordable.
The program has produced 15,351 units affordable to households earning 80% of MFI or
less.
TOD requirements: a bus route located within mile of the development for multifamily/
mile for single family.
The Green Building program rates single family homes, multi-family residences, and
commercial structures regarding siting, energy, water, materials, indoor air quality, and
education and innovation.
Takeaway for Dallas: Sustainable mixed-income development can work.

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Dallas Texas
March 2016

Dallas Texas
March 2016

Summary of Major Recommendations

Muster the political will to address the affordable housing crisis


Create a Chief Executive Officer of Housing and Community
Investment
Create a Housing Trust Fund with dedicated revenue sources
Identify a limited number of housing and community revitalization
focus areas
Expand housing choices in high opportunity areas
Create a predictable, transparent and efficient housing policy
Citywide
Enough Planning Time to Act

71

Dallas Texas
March 2016

Questions

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