KMUW | By Celia Hack
The for-profit and nonprofit developers will ultimately sell or rent the homes to low-income households.
The Wichita City Council voted Tuesday to award $1.3 million in COVID recovery funds to nonprofit and for-profit housing developers to buy and renovate 33 single-family public housing units.
Wichita Habitat for Humanity, a local nonprofit, received $640,000 for the rehabilitation and sale of 16 houses on North Piatt.
Large Enterprise, a California-based business, received $440,000 for the renovation and rental of 11 properties in northeast and southwest Wichita.
Residential Housing Solutions, a local business, received $240,000 for the renovation and sale of six houses on North Minnesota.
The homes the developers will buy are public housing units the city is in the midst of selling.
Wichita has 352 in total, many of which have already been sold to homeowners or investors without restrictions on future sale price or rent. The city reports that many of the houses require “much needed rehabilitation.”
But Wichita set aside roughly 60 homes that it hopes to keep affordable long-term. In May, the city opened a call for proposals from developers to buy, renovate and then sell or rent the properties.
Using its COVID recovery funds, Wichita offered $40,000 per unit to help buy and rehabilitate the homes. But developers are required to keep the units affordable long-term by participating in federal rental assistance or homeownership programs, which limit the maximum income of participating tenants or homebuyers.
The properties are clustered in two neighborhoods: about 40 in northeast Wichita and about 20 in southwest Wichita, near Pawnee and Meridian. All but four of the homes the city awarded funds for Tuesday are in northeast Wichita.
“This really was an effort to be able to evaluate: If we had a concentrated investment of funding in these neighborhoods, what type of overall neighborhood improvement and growth would we see?” Sally Stang, the city’s housing and community services director, said at the City Council meeting.
Individual purchase agreements for each house, as well as contracts for rental assistance or down payment assistance, still need to be brought before City Council.
How the funding got awarded
After the city opened its call for development proposals in May, the city received qualified applications from four developers.
In August, each developer pitched their plans to the Affordable Housing Review Board, which forwarded their recommendations to the City Council.
Board members unanimously approved awarding Wichita Habitat for Humanity all of the funds and houses it requested.
Board member Rebekah Starkey Keasling said she appreciated that the nonprofit is moving its headquarters to northeast Wichita, near the public housing units Wichita Habitat for Humanity plans to buy.
“We know that these houses are going to cost more to fix up than they’re going to make, most likely,” Starkey Keasling said. “And the fact that Habitat has a plan, and that they’re not here to make money on it, they’re here to help with home ownership.”
The board also unanimously agreed to award all six homes that Residential Housing Solutions requested. Several board members said they approved of the business’ commitment to the community and neighbors.
The board voted to fund just 11 of the 16 houses Large Enterprise requested. One board member, Jack Silvers, voted against the decision. Silvers said he didn’t think the business had enough experience.
“They did a municipal water district project … in Orange County. This says they’ve redone seven houses,” Silvers said. “It doesn’t seem like an awful lot of experience to me.”
The board rejected one developer, Washington, D.C.-based Project Prosperity. Both homes the developer was seeking had also been requested by Wichita Habitat for Humanity, which the board prioritized.
History of the city’s single-family public housing
Wichita’s decision to sell its single-family public housing units came after years of uncertainty around the future of the city’s – and country’s – public housing stock.
Nationwide, cities have struggled to maintain their public housing as the federal money Congress allocates for the units has failed to keep up with need. Public housing in the U.S. needs billions of dollars in repairs, a reality that means many of Wichita’s public housing units are dilapidated.
In 2017, the city pursued a federal program that converts public housing properties into privately-owned properties where tenants receive federal rental assistance. This type of project allows local housing authorities to get private financing to rehabilitate housing units that need lots of repairs.
After two years pursuing the conversion program, the city found it couldn’t secure financing for its single-family public housing units. The homes were too scattered throughout the city.
The city regrouped in 2021, when $72.4 million in federal money from the American Rescue Plan Act came to Wichita. The city put $5 million of it toward the affordable housing fund, which was meant to help developers buy and rehabilitate the public housing units.
The affordable housing fund provided the funding for the awards to Wichita Habitat for Humanity, Residential Housing Solutions and Large Enterprise.
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This article was republished here with the permission of: KMUW