By Emily Toepher, West Valley View, August 14, 2015
BRIAN SWANTON, Arizona market president of Gorman and Co., speaks Tuesday at the groundbreaking for Madison Heights, Avondale’s new housing project on Dysart Road and Madison Street. The project is the first in the state to take advantage of a new federal program called the Rental Assistance Demonstration program. View photo by Jordan Christopher
AVONDALE – A rental housing project in Avondale will increase the number of affordable units for low-income residents and be the first in Arizona to use a new federal program.
Developers broke ground Tuesday on the two-story Madison Heights project at 1103 N. Sixth St. in Avondale, which will have 143 units and should completed in December 2016. The state-of-the-art, environmentally friendly, multi-family development will replace 77 existing dilapidated units on the property, which were built in 1973 and have evaporative coolers.
“It was painfully obvious that this wonderful housing project had outlived its economic and physical usefulness,” said Mike Trailor, director of the Arizona Department of Housing. “These days, for people to be living in substandard housing with swamp coolers in Arizona when it’s 113 [degrees] is not a very good situation.”
To qualify for the housing, residents must earn at or below 60 percent of the area’s median income. The amount is adjusted by family size and a variety of other factors, but roughly equals $20,000 to $40,000 a year, said Brian Swanton, Arizona market president for Gorman and Co., one of the project’s partners.
“We don’t leave any of our citizens behind,” Avondale Mayor Kenn Weise said. “The revitalization of historic Avondale and this project really do show that Avondale is one community, one mind and one voice.”
The new housing units have varying floor plans, and the property will feature on-site amenities, including a computer lab, fitness center and multipurpose community room with free before- and after-school programming. It will also offer services such as job training, job search assistance and job placement, Trailor said.
“This isn’t just about putting a roof over people’s heads; it’s about addressing their greatest needs and helping them to overcome the fears and burdens they’ve carried with them for years,” he said. “I’m a big believer in sustainability, but in our culture, sustainability starts with having a job. So helping people get employed and helping them seek their greatest potential is a real important part of what we do.”
Several residents are still living in the current units, and will be given the option to return to the property at their same rental amount once the new buildings are complete, Swanton said. Demolition on the exiting units will start Sept. 1. Most of the residents already chose to relocate to other public housing in the last 12 to 18 months, and no new units were rented out in that time, he said.
1st to use federal program
The project is the first in Arizona to take advantage of a new federal program called the Rental Assistance Demonstration program, designed to redevelop the nation’s aging stock of public housing. It allows public housing agencies to leverage public and private debt and equity in order to reinvest in the public housing stock. The program is cost-neutral and does not increase the budget of the Department of Housing and Urban Development.
Which is particularly useful since the country currently has a $26 billion backlog of capital needs, said Ophelia Basgal, regional administrator of HUD.
“The amount of money they get on an annual basis for capital funding simply wasn’t sufficient to address this kind of backlog,” Basgal said.
Through the program, units move to a Section 8 platform with a long-term contract that, by law, must be renewed, and ensures the units remain permanently affordable to low-income households. Residents continue to pay 30 percent of their income toward the rent and maintain the same basic rights they possess in the public housing program. The RAD program has allowed local communities across the country to raise more than $989 million in new capital funding, which affected almost 18,000 units, she said.
About 170,000 affordable housing units have been lost to sale or demolition, and the backlog threatened the loss of 10,000 more units each year because of disrepair, Basgal said.
RAD started with a limit of 60,000 units, but Congress raised the cap last year to 185,000 and President Barack Obama has asked Congress to lift the cap entirely, she said. A bill currently before Congress would also reduce home funds dramatically, cutting about 93 percent or $13.3 million of funding in Arizona, Basgal said.
“When you’re here and you see what a difference it makes, it’s important to know that’s being talked about,” she said.