Rural Nelson Meeting Wednesday, April 2, 2003 Conny Roussos opened the meeting and asked everyone to introduce themselves. He then introduced the panel on Affordable Rural Housing - Mr. George Krieger, Executive Director of Nelson County Community Development Foundation and Mr. Bernie Murrens, President of Nelson County Habitat for Humanity. Conny noted that part of Rural Nelson's mission statement is to support affordable housing. This involves making sure residents are not left out as not all can afford the million dollar home. Mr. Krieger said that NCCDF was formed in 1986 by concerned citizens wanting to leverage assets to aid folks looking for affordable housing. He said that NCCDF had built 72 houses in Nelson and converted 110 since 1986 and was now also involved in the development of the Nelson Center. Mr. Krieger said that the definition of affordable housing depends on whom you talk to. He said that for NCCDF, affordable housing was housing within the budget of citizens making 80% or less of median income, which is $38,700 in Nelson now. He said that most recipients are actually between 60-70% of median income. He listed four reasons why affordable housing is needed in Nelson: 1. 40% of Nelson citizens qualify as low or moderate income and need housing opportunities; 2. Existing substandard housing is unsafe, costly for the occupant and generates little or no revenue for the county; 3. The increasing price of land in certain parts of the county makes affordable housing more difficult; and 4. Overall lack of decent, affordable rental properties in the county. Mr. Krieger said that most federal programs dictate that housing costs not exceed 30% of a family's gross income. In fact though, at a recent state conference on housing, Governor Warner reported that more than 30% of Virginia citizens are paying 50% or more of their gross income towards housing. Mr. Krieger said that housing costs include rent or mortgage, utilities, insurance, taxes, maintenance and upkeep. Impediments to achieving affordable housing include availability and affordability of land and the costs of infrastructure for the land, especially on marginal land. He said that NCCDF tries to address the availability of down payment and closing cost assistance. He said that the program tries to identify applicants that will be suitable for the program, as they do not want to put people in a position to fail. They try to work with families to do budget classes, etc. He said that it is difficult to attract local contractors to do affordable housing when you are asking them to keep their profits as low as possible to make the home more affordable. NCDDF has tried to cultivate a couple of contractors by giving them as much work as possible. Mr. Krieger noted seven possible strategies to mitigate the impediments to affordable housing: 1. Low-cost development loans and financing for construction and infrastructure; 2. Participation by housing authority, non-profit or other NGO in housing development; 3. Donated land by local government, possibly tax-delinquent property; 4. Waived connection fees for water and sewer; 5. Zoning ordinances that require new development served by public water and sewer to set aside a portion of lots for affordable housing; 6. Cooperative ventures between local government and the private sector to stimulate development that creates affordable housing where served by public utilities; and 7. Creative development strategies that economize on infrastructure costs, i.e. cluster development, allowed and encouraged by local regulations. He then reviewed some of the homeownership and rental development programs of NCCDF and said that the group is developing plans to build 8 rental units in the county over the next 5 years. He said that discussion of rental housing usually carries the perception that we will be attracting low-income people from outside the county, but noted that there are many here in Nelson in need of rental housing. Noting our population of approximately 14,500, Mr. Krieger was asked how many are in substandard housing. He said that in a government study done in 1988, 33% lacked indoor plumbing although he was not confident of the survey results. He said that 2% have been rehabilitated between the 1990 and 2000 census. He said that he would guess that 20% would be a safe estimate of the number of substandard homes. Mr. Bernie Murrens, President of Nelson County Habitat for Humanity, said that the group had been active in Nelson for 10 years and built 10 houses. He said that they are hoping to build two houses this year. Mr. Murrens said that the typical applicant is between the 50th and 75th percentile of median income and that the neediest person gets a house first. The applicant has to be able to pay for the home, as the program is not a charity. The program requires sweat equity. He said that Habitat has a family selection committee that makes the final decision from the 25-30% of applicants that will qualify. He said that Habitat looks at the economics - the need, the willingness to work and whether the family can pay for it. The group has to be able to leverage everything available to help the family succeed. Habitat has a Support Committee and each family has a sponsor to help them succeed. He said that help from the Food Pantry, the RVCC Treasure Chest, free medical care for children and other programs all leverage the family's ability to pay. The group raises all of the money for each house and accepts no government funding. They are flexible on the length of the mortgage with no interest on the loan and can make it affordable for families willing to work with Habitat. He said that Habitat is trying to break the cycle of poverty and is in the business of building families and making more productive citizens. Mr. Murrens was asked the cost of a typical Habitat home and said $43.00/sq. ft. with a 1,000/sq. ft. house costing $43,000. He said that all 10 houses built by Habitat volunteers still have the original owners living in them. Mr. Murrens said that the program is dependent on donations, which can be made directly to the local Nelson County Habitat for Humanity at P. O. Box 338; Nellysford, VA 22958. ------------------------------------------------------------------------ This report, sent to over 525 Nelson County citizens, was made possible by the generous donations of Rural Nelson members and supporters. Kim T. Cash Field Officer Rural Nelson, Inc. P. O. Box 401 (622 Front Street) Lovingston, VA 22949 434.263.5000 Email: info@ruralnelson.org www.ruralnelson.org