Philly Council bill would give nonprofits first dibs on buying affordable housing

By: - November 3, 2019 6:30 am

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By Michael D’Onofrio

PHILADELPHIA — A bill floated in City Council would give nonprofits first dibs on certain affordable housing properties when they come up for sale.

The legislation would require some owners of affordable housing properties to inform city agencies and the councilmember who represents the district where the property is located years in advance of the expiration of their affordable housing restrictions, which allow them to sell the properties or flip the units to market-rate.

The timeline would allow city and state agencies and non- and for-profit developers dedicated to maintaining affordable housing to purchase the property or match offers from outside bidders. The qualifications for these developers, however, have yet to be defined in the bill.

At-large City Councilman Derek Green, a Democrat running for re-election on Tuesday, said a lack of notice about these availability of these units often thwarts nonprofits from purchasing them.

“This is a way to try to preserve the units that are affordable and let them stay affordable,” said Green, the main sponsor of the bill.

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The bill would set new policies for dwellings that contain four affordable housing units and that received a federal Low-Income Housing Tax Credit, the most significant resource for creating new rental units for lower-income households, and other publicly supported affordable housing programs.

Green did not have figures for how many properties in the city his proposal would affect.

Under the bill, the owner of one of these properties would inform the city at least 24 months before their affordable housing restrictions end. Owners would notify the Philadelphia Housing Authority, the councilmember who represents the district where the property is located, and Community Legal Services of Philadelphia.

The bill would require the city to forward the notice to an approved list of eligible nonprofits and organizations, and post the notice on a city website.

Owners also would have to inform all tenants living in the affordable housing units, directing them to seek legal assistance from Community Legal Services.

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After providing notice, the bill would place the sale of the property on hold for 180 days while the owners market the property and take bids. The bill would require an owner to inform the city of any offers.

Nonprofits and other groups would have 60 days from receiving a notice to make an offer on the development or match an offer from a bidder.

All residential buildings sold through this process would trigger a 45-year affordability restriction for the property through the city.

Fines would range between $200 and $1,000 a day for violators.

Green had no co-sponsors for the bill. The first-term councilman has until the final City Council session on Dec. 12 to hold a hearing and get the legislation passed, or the bill is scrapped to make way for a new City Council to take over in January.

Other cities and states across the country have passed similar legislation, including Washington, D.C.; Portland, Oregon; California; and Maryland.

Philadelphia lost more than 37,000 low-cost rental units priced under $750 between 2000 and 2015. Each year, 22,000 evictions are filed in the city, affecting one in 14 renters.

In recent years, buildings containing affordable housing units have sold with little notice, leaving low-income residents scrambling to find new housing.

Last year, low-income tenants living in two private West Philadelphia apartment buildings — the Dorsett Court and Admiral Court — were ordered to leave ahead of a sale. In 2017, more than 200 tenants in the Penn Wynn House in the Wynnefield, which received public subsidies, were evicted to make way for renovations and increased rents.

Green said the issues at the Penn Wynn House and others were examples of the huge increases in rental costs happening throughout the city.

“We need to maintain as many affordable units as we can,” he said.

Michael D’Onofrio is a reporter for the Philadelphia Tribune, where this story first appeared.

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