Business and community leaders are putting $100 million into a new “Housing Action Fund” to boost development of affordable housing in Franklin County, officials announced on Monday.
Financed entirely by private-sector contributions and investments, the fund will offer low-cost loans to developers who commit to certain affordability requirements.
“We know that more than 54,000 people in central Ohio live at or near poverty and spend more than half of their income for housing,” Columbus Mayor Andrew J. Ginther said in a news release. “As the city and region continue to grow, we must make sure that residents who work in the region can afford to live here, too.”
The fund is to be managed by the Affordable Housing Trust for Columbus and Franklin County. Steve Gladman, president of the trust, said the new fund will finance both new construction and rehabilitation or upgrades of existing properties.
“Developers are looking at various models,” he said.
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City and county officials expect that the fund will lead to the creation of at least 2,150 additional units of rental housing. All rents should be affordable to residents with incomes at or below 120% of the county’s area median income as determined by the U.S. Department of Housing and Urban Development, which is about $93,600 for a family of four.
At least 51% of the units are to be affordable at 80% or below of the county median — $62,400 — for a four-person household — while the fund will give priority and incentives to projects that average 60% or below of the median, or $46,800.
“We’re looking at housing that’s affordable. That’s typically measured as no more than 30% of your income,” Gladman said.
Among those contributing to the fund are Huntington National Bank, Fifth Third Bank, the Columbus Foundation, Heartland Bank, Nationwide, NiSource and Park National Bank.
Steve Steinour, president and CEO of Huntington National Bank, led the effort to gather banks to participate in the fund. That effort took about a year.
“Nothing has ever been done of this size in Columbus,” Steinour said on Monday.
Steinour said he suggested the effort to help nonprofit groups.
“It’s important for us how the economy and neighborhoods go here, the health and vitality of the neighborhoods we serve,” Steinour said.
Asked about how this fund helps Huntington, Steinour said, “It is not a direct benefit. Doing the right thing helping others is also good business.”
Steve Schoeny, director of the Columbus Department of Development, said the idea is for the fund to be both nimble and flexible so that projects can get underway quickly. No particular areas of the county will be targeted, and there is not a focus on specific demographic groups, such as seniors or families with children.
“There are needs everywhere,” Schoeny said. “I can’t tell you the list of communities that are expressing interest, but you will be shocked by the breadth of communities that want to participate in this discussion about affordable housing. It affects every community in central Ohio. I don’t want us prejudging that.”
Housing advocates have long agreed that fast-growing Franklin County falls short on affordable housing. The city said a Builders Industry Association study shows that about 8,000 units are built each year in Columbus, far below the 14,000 needed across the city and county.
“We’re really excited about this,” Schoeny said of the new fund. “This is another piece of the pie, another note in the drumbeat. The term ‘progress’ is important, because we will never be done with this work.”