Low-income residents could be on the move

South Metro Housing Options wants to sell or demolish 71 homes

Posted 7/15/19

Jackie Chavez was finally starting to feel settled. Chavez, 28, spent her younger years moving from place to place in east Denver, with her young children in tow. Three years ago, she landed a …

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Low-income residents could be on the move

South Metro Housing Options wants to sell or demolish 71 homes

Posted

Jackie Chavez was finally starting to feel settled.

Chavez, 28, spent her younger years moving from place to place in east Denver, with her young children in tow.

Three years ago, she landed a two-bedroom duplex in north Littleton, after three years on a waiting list through South Metro Housing Options, which administers federally-funded, low-income housing in the Littleton area.

Chavez pays 30% of her income in rent, which has ranged from $800 a month when she moved in, to $78 a month during a recent bout of unemployment, and will soon rise when she starts her new job as a dental assistant.

It took a while for Chavez, who is raising her three kids on her own — ages 7, 5, and three months — to feel at home after so much roaming.

Keeping her rent at a third of her income — a commonly-cited threshold to maintain a healthy personal budget — helps ensure a good life for her children amid Denver’s sky-high housing prices while she establishes herself in life, she said.

On the tree-lined cul de sac overlooking Powers Park, just blocks from her kids’ elementary school, Chavez hoped to stick it out for the long haul.

“We’ve felt so lucky to be here,” said Chavez, bouncing her baby daughter Serenity on her knee. “It feels so much safer than everywhere else we’ve been.”

But Chavez and her kids may soon find themselves moving again.

SMHO is looking to sell off or demolish its 71 single-family and duplex homes, which are scattered around Littleton and represent about half of its portfolio of public housing.

Chavez’s duplex is one of 12 units that may be torn down to make way for a large multifamily, low-income housing complex in coming years.

SMHO, which also administers hundreds of Section 8 housing vouchers that cover most of recipients’ rent, is increasingly struggling to keep up with its “scattered-site” housing in the face of fluctuating and dwindling federal funds, said executive director Corey Reitz.

“They’re older units,” Reitz said. “The upkeep on them is challenging. That will only continue, and keeping them up-to-date is difficult. We’ve been talking about this for a while.”

Moving away

SMHO is planning to ask the federal Department of Housing and Urban Development for permission to divest itself of the scattered site housing, under a recently streamlined process called Section 18.

If HUD accepts SMHO’s application, which could happen as early as October, SMHO would begin working with residents on a months-long move-out process before selling or demolishing the homes. Families with children in school would be allowed to finish the school year, Reitz said.

Residents of the 71 homes would be given moving assistance and Tenant Protection Vouchers, which are effectively identical to Section 8 vouchers and can be used anywhere in the country, Reitz said. Residents who meet certain criteria — and whose houses aren’t slated to be demolished — could be eligible to buy their homes from SMHO, which Reitz called the “best-case scenario.”

Though many of the plan’s details are far from hammered out, Reitz said many of the homes could become deed-restricted properties, meaning they could only be sold for below market value going forward, giving a foothold to young families hoping to buy into an increasingly unaffordable suburb.

The proceeds from the sales would go into a fund to acquire, develop or redevelop affordable housing units in the near future, Reitz said.

Initial reaction from residents has been mixed, Reitz said, with some tenants excited at the prospect of being able to move closer to family with a more portable housing voucher.

“I think this program has the potential to be very positive for the community,” Reitz said. “We’re certainly concerned about current residents, and we’re taking the time to hear feedback and make sure their needs are met through this process.”

Changing trends

SMHO is not alone among public housing authorities in shifting away from scattered-site housing, said Dr. Ed Goetz, a professor of urban planning at the University of Minnesota, who studies public housing policy.

“It happens for essentially the same reason,” Goetz said. “Most housing authorities find themselves cash-strapped, primarily because Congress has been knowingly underfunding public housing budgets for years. They’re not getting enough money to do maintenance or make upgrades.”

Scattered-site housing became popular in the 1970s, Goetz said, with the idea that residents would become more integrated into communities than they would in large-scale public housing projects.

“Nobody had to be the wiser” that their neighbors were in federally-owned housing, Goetz said.

The flip side is that the homes are more expensive to maintain, because of non-standard components like doors and windows and because of the added travel time for maintenance crews between units, Goetz said.

Though the White House’s current budget proposal calls for deep cuts to public housing, each of the last several presidential administrations have sought cuts, Goetz said.

Section 8 funds, however, tend to be far more stable, Goetz said, though the outcomes for residents transitioning to Section 8 from public housing can be spottier.

“In some places, it’s tough to find landlords that will accept Section 8, or to find units that are well-maintained,” Goetz said.

Residents, many of whom are elderly or disabled, may find themselves on the hook for higher costs like utility payments that were subsidized in public housing.

“Research seems to indicate that when people make that transition, some experience economic insecurity,” Goetz said.

Keeping an eye on things

Uprooting 71 Littleton families is a daunting and delicate task, said Littleton Mayor Debbie Brinkman, and one she hopes the city will keep a close eye on.

“You’ve got 71 families that may not otherwise have been able to live in Littleton,” Brinkman said. “These people are important assets in our community. They’re in our schools. They have jobs here. They’re active, engaged citizens.”

Littleton City Council appoints SMHO’s board, Brinkman said, and SMHO is the property manager for Geneva Village, Littleton’s city-owned senior housing complex that offers below-market-rate rents.

Littleton partners with SMHO on a variety of housing efforts, but otherwise does not have direct oversight, Brinkman said.

Brinkman said she hopes SMHO is open, communicative and helpful to affected residents.

“You’re talking about people’s homes,” Brinkman said. “If they have to quit their jobs or move their kids to a new school district, that’s scary. I don’t want to see anyone living in fear.”

The net result of SMHO’s efforts could be positive for the area, said Linda Haley, the division manager of Arapahoe County’s Housing and Community Development Services Division.

Though the county is not officially endorsing or involved in SMHO’s plans, Haley said the idea of turning some of the scattered-site homes into deed-restricted properties is a great one.

The need for affordable, for-sale housing is “big and ugly,” Haley said. “There’s a huge shortage of affordable housing on every front. And if this plan raises capital to develop additional housing, all the better.”

SMHO is bound by legal requirements to provide relocation assistance for all displaced residents, Haley said.

“I don’t want to make this seem like it won’t be a difficult process for tenants, but there’s a process in place to make sure they have as soft a landing as possible.”

Haley said her office is happy to lend expertise and stay in close communication as the process moves forward.

For Jackie Chavez and her three kids, though, the process is about waiting.

“Right now,” Chavez said, “we’re just thankful we have a roof over our heads.”

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