Falls Church’s Economic Development Authority, the influential, semi-autonomous body tasked with advancing the cause of economic development in the Little City, voted unanimously at its monthly meeting Tuesday night to participate in the City’s dialogue over plans to improve its affordable housing stock. It voted to submit a letter to the F.C. City Council urging the formation of an ad hoc committee on affordable housing.

“There is urgency to this issue as the current trends are moving in the wrong direction,” a draft letter from the EDA board approved Tuesday states. “In order to develop a comprehensive approach, the EDA is recommending the establishment, by the City Council, of an Ad Hoc Committee featuring all the City’s interested public and private parties, civic organizations, faith-based groups, and more that would come together to tackle this issue and outline a variety of possible solutions,” it added.

A sentence was added to the letter at the meeting stating the EDA’s view that affordable housing solutions are not undertaken at the expense of on-going market-based economic development issues.

But it recognizes that “housing and economic development issues are intertwined in many ways, including but not limited to the benefits of a diverse population, including diverse economic backgrounds, the impact on hiring and retaining employees, and the impacts on community, education, transportation and the quality of life for residents, business owners and employees of City businesses. The increasing regional costs of living impact residents and therefore affect businesses and business opportunities. The recent, and forecasted, decline in market affordable housing in the City impacts the entire community.”

Over the summer months, the issue of “affordable housing,” also described as “affordable living,” rose to the level of an urgent concern, not only in the deliberations of the Falls Church City Council, but also on a regional and national level. A severe shortage of affordable units has caused the problem to be described as a “crisis” in a lot of the deliberations.

As reported last month, the regional Council of Governments adopted the conclusions of a report by the Urban Institute indicating that there is an urgent need for 374,000 new housing units in the region by 2030, a 31 percent increase over previous projections, and that three fourths of the units will need to be “affordable” for low and middle income families. It decided not to set goals by individual jurisdictions in the region, but nevertheless sounded a noisy alarm intended to spur local jurisdictions into action. The Urban Institute, in its report, entitled, “Meeting the Washington Region’s Future Housing Needs,” indicated that the three greatest threats to continued economic growth in the region are traffic gridlock, a shortage of qualified workers and a lack of affordable housing.

The second and third threats are interrelated. If there is no affordable housing available, qualified workers will locate in places where it does exist. “Housing shortages can undermine worker productivity, increase the difficulty businesses face in attracting and retaining employees, and discourage businesses from locating in the region,” the report stated.

It added that someone earning an income of $54,300 or less needs to be able to afford housing at $1,300 or less. But since 2010 only 10 percent of the new housing units built here have fallen into that price range. That rate needs to increase to 38 percent, according to the institute report.

Thus, the EDA has raised the issue in a number of its recent monthly meetings, and finally agreed upon a letter Tuesday night that acknowledges the need, but denying it should take the lead role. Instead, it called for the ad hoc committee which could have an advisory role over whatever pool of financial resources are put to the issue by the City Council.

It would also weigh in on the matter of whether the City should continue its current practice of requiring a certain percentage of units in new mixed-use projects to be provided by the developer at an affordable rate.

Bob Young, a local developer who chairs the EDA, opined at Tuesday’s meeting that he is inclined to prefer taking a cash proffer from developers to deposit into an affordable housing fund over the current policy.
Others chimed in, noting that the small number of units the current policy calls for can not keep up with the urgent demands for hundreds of new units. If the percentage of units that must be offered at affordable rates is increased, it also deters new development, it was noted.

To date, the City has five approaches on the table.

The first is to set up a fund and to pay into it with the goal, in particular, of continuing an arrangement with The Fields, an apartment complex in the West End, that is currently due to expire by 2027, with the option to use that fund to receive proffers from developers in lieu of a percentage of affordable units on site.

The second is to shift City policy from asking developers to set aside a percentage of proposed units for affordable housing to the cash proffer option that would, among other things, allow for leveraging accumulated funds to build a kitty.

A third is to revise parking minimums at mixed-use projects to improve the ability of developers to maximize the use of their properties and enable greater participation in affordable housing proposals.

The fourth is the encouragement of market rate affordable housing, as in the case of the nearly 100 “micro units” that developers of the West End development project are planning as a component of their dense development of 10.3 acres adjacent the West Falls Church Metro.

The fifth is the introduction of changes in the City’s zoning laws to better incentivize the opportunity of single family homeowners in the City to build small “accessory dwelling units” on their property, often called “granny flats” because they could be used to provide housing for aging family members.

That option is likely to be the subject of more serious deliberations by the City Council and Planning Commission this fall. Major changes in zoning laws to encourage such developments were voted unanimously by the Montgomery County, Maryland, Council to address the affordable housing issue.

Support for the granny flats option was expressed more than once at Tuesday’s EDA meeting.

Among other things, it might be a preferred option for many single family homeowners to remain in their existing homes while deriving increased income from their property. That would be preferable to selling lots to interests seeking to build “mega-mansion” housing at $1.2 million or above. That has already happened on more than 130 residential properties in the City and more than 2,000 properties are eligible for similar outcomes.

In addition, energy efficiency programs as contained in the state’s Senate Bill 966 enabling Dominion Power to offer discounts can also contribute to the affordability of housing, Tim Stevens noted. Council members Letty Hardi and Phil Duncan were also present at Tuesday’s meeting.

At the Oct. 21 meeting of the F.C. Planning Commission, the director of Arlington County’s affordable housing programs will speak to offer his expertise and experience on ways to move forward on the matter.