PORTLAND, OR—When most people buy a home or sign a lease for a conventional rental property, they can expect to see an inspector maybe once a year, less often in most cases.

But if you reside in what is defined as “affordable housing,” you might as well make up a spare bedroom for the inspectors. Studies done in the states of Washington and Oregon revealed that those who manage and reside in affordable housing properties frequently are forced to undergo compliance inspections annually from multiple agencies—all with essentially the same inspection checklist.

HDC's Robin Boyce, left, with Barbara Gibbs of Meyer Memorial Trust (photo Erin Houlihan)

“Someone might have to let as many as six inspectors a year tromp through their apartment – inspectors from the Housing Authority, from the State, from the City, from other investors,” says Margaret Mahoney, Director Of Property Management at REACH CDC in Portland.

While residents are inconvenienced, property managers of those buildings have to schedule each inspection and then waste time and money filling out complicated, duplicative reporting forms for each funder. The result? Higher rents for those who can least afford to pay more.

In Oregon, this is where the Housing Development Center enters the picture. The nonprofit developer offers a wide range of services to builders, owners and managers of affordable housing projects. Its staff also uses its collective experience to change housing policy and the way things work in the marketplace, something most for-profit developers don’t do.

HDC’s team is especially adept at asset management—addressing practices and processes at properties that are underperforming. HDC has built a reputation for bringing efficiency, sustainability and better operating costs to project after project. It also facilitates a property and asset management working group for nonprofit owners, sponsored by the Oregon Opportunity Network. This working group led the initial study to quantity the costs of compliance. HDC was the obvious choice to take the lead on the streamlining initiative.

“The streamlining initiative will make the public dollars targeted for affordable housing do what they’re supposed to do: improve housing and related services for the people who need them,” said Robin Boyce, executive director, Housing Development Center.

The state of Washington had taken on the job of streamlining affordable housing inspections some years ago. Without much of a roadmap, it proved to be a long, thorny undertaking. But Oregon Housing and Community Services was watching, and once Washington had a handle on the process, HDC and nine public and private funders were ready to test it in Oregon. In 2009, HDC led a team of lenders, property managers, and owners that studied the issue and created a plan to address it.

On March 31, Portland’s Housing Development Center streamlining coalition and others prominent in the affordable housing industry met to announce the results of the first year of the project, and to set the agenda for Year Two. The luncheon took place at Station Place, a property owned by REACH CDC and located in Portland’s decidedly unaffordable Pearl District. But the event was held just minutes away from Madrona Studios, another affordable housing project that benefited greatly from HDC’s expertise. The room was packed with participants in the project:  housing execs, lenders, funders of the initiative, bureaucrats, affordable housing facility owners and managers—all committed to streamlining.

Everyone involved wants it to succeed, so they can all spend more time improving living conditions for affordable housing residents instead of filling out duplicate forms. (Oregon’s Meyer Memorial Trust, one of the most prominent foundations in the state, gave streamlining its endorsement by providing crucial financial support for the project.) The research phase of the project (involving 20,000 affordable units across Oregon) found that providers spend up to 10% of their total project operation costs just on complying with overlapping government rules – an average of $8 million dollars a year.

“We manage over 6,500 units of affordable housing,” says David Bachman, CEO at Cascade Management in Portland. “It uses a lot of resources, filling out up to eight annual financial reports and demographic data forms for each funder or lender. Those reports are typically in a different format from each other.  In addition, scheduling an average of four inspections for each unit consumes even more staff time, not to mention the burden it places on residents.”

Currently, the Oregon team is field-testing the plan it created in 2009 on 28 properties across the state. It’s rolling out the strategy with a select few affordable housing facilities to see what works and what needs fine-tuning. The plan hinges on getting all the agencies involved to coordinate their efforts – which they’ve spent the last year doing. If the pilot project goes well, new rules might be adopted statewide next year. The savings could reduce housing providers’ compliance costs by half, which could mean shifting $4 million dollars a year towards helping residents and improving and preserving affordable housing.

“Everybody wins – the residents, the funders, the housing providers,” said Molly Rogers, the Housing

Molly Rogers of HDC, right, chats up Alissa Brumfield of the Portland Housing Bureau (photo Erin Houlihan)

Development Center manager supervising the project. “And ultimately our communities win, because it means more resources can go towards giving people the opportunity to build better lives by having a place to call home. Oregon would be only the second state in the U.S. to streamline – we could be a model for the country.”

“We’re reducing the complexity of housing compliance for our government and nonprofit partners,” says local federal housing director Doug Carlson, who participates on the Funders Workgroup of the project. “By cooperating, we can save a lot of money and spend it where it belongs: on ensuring everyone has a safe, decent place to live, while at the same time, meeting the program requirements of federal, state and private housing lenders.”

Jesse Beason, of Portland's Proud Ground

Portland, OR–This city has long demonstrated a sensitivity toward the role housing plays in peoples’ lives. From its progressive and compassionate attitude toward the homeless to its innovative affordable housing community, Portland is the nation’s test kitchen for properly and humanely housing low income individuals and families.

Despite the collapse of the international housing market in 2008, the city scored two major recent coups: the  2009 rehabilitation and preservation of the historic Nuevo Amanecer housing project in nearby Woodburn; and the completion this year of the renovation of an aging motel into the chic yet affordable Madrona Studios. (Both projects benefited from the expertise of the Housing Development Center.)

But affordable rental properties are one thing. Affordable home ownership is quite another matter. Yet here again, Portland has produced an organization that has demonstrated how to successfully transition low-income families from a rental to an ownership situation.

Since 1999, Proud Ground has provided affordable home ownership opportunities for people who live and work in the community.  And to date, after placing 130 low-income families into homes that they own, Proud Ground has never suffered a single foreclosure.

Working with community partners, lenders, builders and others, Proud Ground:

• prepares families and individuals for homeownership;
• helps them purchase existing homes;
• builds new affordable homes;
• offers homeowners tools to be successful;
• ensures the permanent affordability of the homes in its portfolio.

Proud Ground, formerly Portland Community Land Trust, was founded in 1999 by a coalition of community housing advocates and the City of Portland to fulfill a role that the market could not – providing low and moderate-income households with opportunities to buy homes at affordable prices. The founders recognized that Portland wouldn’t be so livable if only the well-off were homeowners.

Since then, Proud Ground has helped more than 130 families realize the dream of home ownership, at a median home price over the years of $119,900. Today, the median price of a Proud Ground home is around $135,000, versus about $230,000 for a market-rate home in Portland.

Proud Ground has more than 115 permanently affordable homes in Portland, and has distributed $7.6 million in grants to make those homes affordable. To make those same homes affordable today would require approximately $10.3 million – more than $2.7 million in additional investment.

Proud Ground is governed by a volunteer board of directors, one-third of whom are Proud Ground homeowners.

Proud Ground is the largest organization using the community land trust model in the Northwest. As such, it helps low and moderate-income families buy their first home.

Jesse Beason, its executive director, joined me for some repartee about the unique and successful mission of Proud Ground. Before taking the helm at Proud Ground, Jesse served as Senior Policy Director for Housing & Planning for Sam Adams, then a Portland Commissioner. Today, Adams is Mayor of Portland.

Q: What differentiates Proud Ground and other community land trusts from other affordable housing organizations?

We use homeownership as an opportunity to empower families to build a better life, while also helping build strong, divers communities. But we also ensure that the opportunity to own a home affordably will exist for future generations.

With prices out of reach for many families, we operate from the premise that the best way to ensure that our children – and their children’s children – have the chance to buy a home, is to keep homes affordable. So, a home bought through Proud Ground is affordable today and it will be affordable tomorrow.

In exchange for a reasonable purchase price (about $60,000 to $100,000 less than a market-rate home), homeowners ensure that future buyers also have a chance to own an affordable home by limiting the home’s appreciation. This way, owners enjoy increasing property values and the other rewards of homeownership – and they gain equity – while passing the affordability on to the next owner. It’s a win for them and a win for our community.

Q: What other affordable home ownership models are similar to Proud Ground’s?

In Portland, we’re pretty unique. But there are over 240 organizations like ours across the country doing similar work. They are often separate nonprofit organizations like ours, but some are part of larger housing or community work. In fact, some chapters of Habitat for Humanity use our model.

Often, housing agencies or nonprofit organizations have second mortgage programs which reduce the price of a homeowner’s primary mortgage. But they often don’t do anything to help with the long term affordability of the home.

Q: How do you define success in this field?

Ever-increasing opportunities for families to own their home at a price they can sustainably afford.

Q: Given that your homeowners would probably not get a traditional mortgage in today’s housing environment, do many of them have to be foreclosed on at some point?

Not a single one of our homeowners has experienced foreclosure. Zero. Our families get traditional, 30 year fixed-rate mortgages at great rates. No sub-prime, adjustable-rate, interest-only hocus pocus. They know they’ll have a stable payment for the next 30 years.

Q: That’s a pretty stunning statistic: 0%. What is Proud Ground’s role in helping its homeowners meet their mortgage obligations?

Well, we make it affordable. That’s the biggest role we play. Other than that, families take full responsibility for paying their mortgage – but we remain their partner in homeownership after closing. We serve as a resource for our homeowners, whether it’s questions about selling their home or the name of a good plumber. If folks are facing hard times we can discuss their options and connect them with other resources in our community.

Q: 50 years ago, could families like the ones that are your homeowners have been able to buy a home in the traditional way? In other words, is it more difficult today for a family to own a home than it was for their parents or grandparents?

Absolutely it’s more difficult. In fact, when you adjust for inflation and interest rates, the cost of the average home in America was the same for our grandparents as it was our for our parents. Can you imagine? For fifty years we had steady prices. It is only in the last fifteen years that homeownership has moved beyond the grasp of many working families. And despite the downturn, I can assure you it’s no more affordable for a large number of Americans.

Q: Is the current post-meltdown climate making it more difficult for Proud Ground to help families enjoy home ownership?

Thankfully, no. While we are somewhat affected by the lack of access to credit to build new homes, our families are accessing mortgages without a problem.

Q: What does home ownership do for your families besides provide them with safe, well-built shelter?

The benefits are incredible. There are of course the tangible benefits. Our families avoid private mortgage insurance and pay reduced property taxes. They build equity and have stable payments.

But there are a large number of intangible benefits that history shows us make all the difference in a family’s prosperity. Children of homeowners are more likely to own homes and attain higher levels of education than children of renters. Just think of what it means to send your kid to the same elementary school year after year. A renter doesn’t have that security.

The community also benefits. Owning a home gives residents a stake in the community and a sense of rootedness in their neighborhoods.  A large presence of homeowners in a neighborhood increases the number and diversity of businesses in the neighborhood and stimulates economic investment.

Q: Talk about a couple of your clients: a typical one and a real all-star.

All of the families we serve are all-stars! Our 100^th homeowners, Kara and David, bought their home two years ago. Since then, they’ve had their first child, added chickens, planted a garden. Anita and her children moved eight times in about as many years. That kept her focused on planning for the next few months. And now, as she says, she finds herself laying in bed thinking of what it’ll be like in ten, twenty years. That’s what ownership can do: make you dream big.

Q: Is the Proud Ground model replicable in other cities and towns, or is Portland a unique housing environment? What conditions allow a community land trust to flourish?

The model can serve communities large and small. And it does. There are organizations serving island communities in Washington, the rural south of Kentucky and urban Chicago. All you need is the will of your residents and the capacity and resources to invest in the families and homes you’ll serve. Certainly easier said than done, but incredibly possible.

Q: Are there any obstacles—government regulations, bank policies, lack of understanding of your mission—to continued growth for organizations like yours?

Organizations like ours have been operating under the radar for some time, so there’s certainly a lack of awareness. But our biggest hurdle is how resources are allocated here. On a national level, we give folks with vacation homes a tax break, but can’t make a first home affordable for today’s average working family. We have great programs with great track records to ensure that affordable rental opportunities exist, but we haven’t yet focused those efforts on the next step—ownership.

The good news is that our current crisis offers the chance to put sustainable and responsible homeownership at the center of the conversation.

This is the second article to appear here from The Press Institute, a nonprofit based in San Francisco. The Press Institute has created a worldwide news service composed primarily of female reporters in developing nations. This story was reported and written by Tara Bhattarai and edited by in country news editor Samir Ghimire and Cristi Hegranes, executive director of The Press Institute. Please visit The Press Institute web site for information on how you can support this amazing organization.

by Tara Bhattarai, Friday – March 19, 2010

A mine defusing expert at work in Nepal.

KATHMANDU, NEPAL — It was 8:30 a.m. on May 14, 2007 when Sunita Ghale, 21, and five friends went into the forest near their village to collect mushrooms for their families’ dinners.

The search for mushrooms led the group into the middle of the forest.  When they decided to return home, they realized they had lost their way. Ghale says she remembers wandering through the forest for more than three hours in search of the path back to her village in the Lamjung district of western Nepal. Finally, they saw a telephone tower in the distance. As they approached the tower, they realized they had stumbled across a military base.

Ghale says they were elated to see the camp after having been lost for so many hours. As they approached the base to ask for directions, Ghale’s friends say they heard a loud blast and watched as Ghale flew into the air and landed a distance away.

She stepped on a landmine.

”When I gained back my consciousness after sometime, I saw a leg separated from a body,” she recalls. “I had never thought that it could be my own leg. There was a pool of blood around me and I fainted seeing it.”

While she was unconscious, security forces brought her to Birendra Army Hospital, by helicopter, in Kathmandu for treatment.

Ghale is one of the thousands of Nepalis who have been hurt or killed by landmines and improvised explosive devices, or IEDs, that were planted by the Nepali Army and Maoist insurgents during the decade long conflict between 1996 – 2006. Statistics collected by the Ban Landmines Campaign in Nepal, an NGO working to remove all hidden explosives, revealed in 2007 that 1,370 people were killed by landmines in Nepal between 1998 and 2006, when the conflict formally ended. The report estimates that as many as 3,248 people were handicapped or injured by landmines during the same period. And more than 200 people have been injured or killed by landmines and IEDs since the conflict ended.

A Treaty Ignored

The Unified Party of Nepal, also known as the Maoists, launched an armed conflict against the royal government of Nepal in February of 1996. Their stated aim was to end monarchical rule and establish Nepal as a republican state. After nearly 10 years of armed conflict between the Maoists and the Royal Army, the government of Nepal and Maoist leadership signed a peace treaty and formally declared the end of the war in November 2006. Per the treaty, both parties agreed they would not lay any new landmines and would inform each other, within 30 days of signing the agreement, the location of any remaining landmines that were set up during the conflict. The terms of treaty mandated that both parties would help to destroy all remaining explosives within 60 days or January of 2007.

Ghale stepped on a landmine more than four months after all explosives were supposed to be removed and destroyed. And today, some three and a half years after the terms of the treaty are overdue, less than half of the minefields in Nepal have been cleared.

You can read the complete story here.

Cristi Hegranes is one of the people who will usher in the return of serious journalism. I met her on a dreary afternoon in Portland some months ago. A mutual friend insisted I had to meet her. She had come up from San Francisco to elicit Portland’s support for her fledgling nonprofit, The Press Institute. Her energy and dedication to the pursuit of journalism grabbed me by the throat and shook me for about an hour. I became a convert to her vision that day.

Cristi Hegranes

The Press Institute is an international nonprofit organization that brings responsible, investigative journalism to communities throughout the world. The Press Institute trains journalists in the developing world, operates news desks in 22 countries and collaborates with organizations dedicated to human development and responsible journalism.

Cristi Hegranes, an award-winning journalist and nonprofit leader, and an eight member board of directors operates this amazing news service. Its in-country news desks are staffed by local women and men who have completed The Press Institute’s Certified Reporter Training program, ensuring they are responsible, solutions-based storytellers with strong source access and unique story angles.

I agreed to help her get her reporters’ stories out there. In the coming days, you will find their stories on this site. I have cleverly connived with Cristi to force you to go to The Press Institute site to read the entire story. But hey, that’s the world we live in these days. Give The Press Institute some linkin’ love. They are doing something that is in short supply these days: original reporting. In some cases, they are risking their lives to do it. Here’s a story from The Press Institute’s Zimbabwe correspondent, Gertrude Pswarayi.

Basic Rights Denied to Sexworkers

by Gertrude Pswarayi, Tuesday – March 16, 2010

BULAWAYO, ZIMBABWE — Locked in a filthy cell that was built for eight inmates, but filled with more than 25, Nyasha Maphosa, 32, a sex worker based in the town of Gokwe in the Midlands province, writhes in agony as the torture of the previous night takes its toll on her diminutive figure. She has endured 48 hours of detention after being picked up by the Zimbabwe Republic Police patrol team. The charge: loitering for the purposes of prostitution.

At her shabby one bedroom cottage, a day after her release from detention, Maphosa relived her ordeal, berating the police officers for their cruelty.

Zimbabwe sex worker

“I was just leaving the pub with two female friends when a mounted patrol team ordered us to stop for questioning,” says Maphosa. “Two of the officers were familiar to me because they were my casual clients,” she claims. “Initially I thought they wanted to do business. I was surprised when they handcuffed us and took us to the charge office,” Maphosa added.

At the charge office, Maphosa and her friends were told that they were under arrest for loitering for the purposes of prostitution. No statement was recorded by the police. Maphosa denies any allegation that she had broken the law. And, she says her stay in custody was horrific. Police officers would occasionally visit the cell and take her and her friends to another office where they would ridicule them and order them to do demeaning and painful acts such as demonstrating sexual acts, sleeping on wet floors and forcing them to relieve themselves in the presence of the officers.

“At one point during the night, a male constable took us into an office. He said that since we were prostitutes, he wanted us to show him how we do it with our clients,” claims Maphosa.

She says that she and her friends were also ordered to crawl on the floor where sand had been scattered, an ordeal that lasted for nearly 30 minutes.

“After performing the degrading acts in front of the police officers, we were taken back to the cell,” she says.

During that same night Maphosa says that some woman constables visited the cell and started to call her and her friends all sorts of names, scolding them for infecting men with sexually transmitted diseases and spreading HIV.

To read the rest of the story, please click here.

My good friend and former colleague at the Portland Business Journal Jana Hughes has written a thought-provoking essay in response to my posts on the Madrona Studios project in Portland. To say we disagree about the project’s merits … Well, it would be correct, we do. Nonetheless, I thought her views were worth sharing with a wider audience. Jana dropped out at 14, left home at 16, and quit stripping when she found out she was pregnant (at 19). She spent the following 13 years working in offices, performing tasks that required progressively less “measured perkiness” and progressively more “critical thinking.” Jana’s paid tasks now require “decision making.” Her current project involves financing a degree in History and Economics, luring small birds into her backyard, and witnessing the teenage years of a kind, thoughtful and talented young lady she still calls roo. She occasionally posts at her personal blog.

Jana Hughes

Re: D.D. Cook’s recent post, “Portland’s affordable housing community raises the bar again.”

More like raising the barrier to entry, I’d say. It is so sad that the Madrona is good news. Bear with me, please.

Commenter Bob says, “Why not support a living wage instead of affordable housing? That way we aren’t ultimately subsidizing corporate profits.”

I have to ask: What do you consider a “living wage”? How much you are willing to pay for your groceries, your widgets, and your next tune up at a Jiffy Lube?

Whenever you talk about “raising the wages,” you are also talking about “raising the prices.” Yes, profits to corporations are large; they are capitalistic institutions, and their corporate charter is to maximize profits. Labor being the lion’s share of production cost, low wages make consumer prices lower.

(This is not the thread to thought experiment about what might happen to prices if health care costs were not part of the employers cost of production or a tirade on viva la revolution, citizen – as much fun as that would be, we live in this world right now, and we are constrained to its realities.)

When commenter Bob mentions that there are two separate issues at play here, welfare housing for those not working, and a place where a low wage worker can afford to live, I want to agree wholeheartedly.

I read the headline thinking that when Dan referred to affordable housing, he wasn’t going to be talking about subsidized housing. But I’ve run some numbers, and….. low income subsided housing and affordable housing for the ‘working poor’ are in this case, indistinguishable. That is why I have a problem calling this good news.

Let me explain by looking at the Madrona Studios. Can we agree that the market this project is aiming to serve is folks who would otherwise be sleeping under bridges with a bottle in their hands? Seems plain enough to me, since they’ve placed the detox center in the lobby (ok, ok, Dan- that’s an overstatement, the Hoopers detox center probably has a separate entrance, around the corner or something).

Still, the picture painted for me by these stories is one of someone moving from the detox center, steadily up the floors into their very own studio as their addiction comes under control. (Temptation to relapse with junkies all around at all hours is a valid concern, but I’m really trying not to digress.) Noble, and necessary- drunks under bridges are not good for general social welfare, giving them dry beds is ok with me.

How these homeless, crawling out of addiction folks will pay the rent on these units is, I imagine, via their disability checks or their section 8 housing vouchers. They will qualify for food stamps, and voila, no more dying in the streets!

There are undoubtedly enough people in these dire straights in Portland metro to fill the Madrona many times over. The building was falling into disrepair and blight, now it has a good practical use. So, great! This is a wonderful place to keep our unfortunates (ah, word choice) off the streets at night.

But let’s look from the perspective of the so-called “working poor.” Does this housing complex represent a benefit for the low earners who ARE working? I’ve run through some numbers.

The rents on these studios (Studios. a 10×10 room and a kitchen and a toilet, noise leaking in from all 4 sides) range from $400 to $490, depending on the view, utilities included. Let’s call it $450.

Income restrictions on the units put a max for single occupancy income at $24,500 per year. This pencils out to a full time worker earning $11.50/hr – good retail, basic services – a wage more difficult to procure these days than you might imagine, practically a kings wage to many.

But these lucky ones can live in a studio apartment for about 27% of their income.

Traditional wisdom used to recommend 25% of income toward housing (utilities included, which the Madrona provides). That recommended percentage has been upped to 33% by ugly long-term economic forces I need not detail here.

So our $11.50/hr. worker, after paying rent, will have a little over $1000/mo. left over (assuming 20% payroll deductions, about what I saw come out of my checks at that wage -after declining the luxury of medical insurance).
This could be that hard first step out of the poverty trap!

… $125/week for food, $100 month for a bus pass, $50 a month for laundry quarters… that’s a few hundred dollars left over at the end for savings, education, entertainment (Don’t they deserve a little fun? They are, after all, working hard for their dollars). But, oh, those nickels and dimes that add up, so quickly, under the mystery heading “incidentals.” (Heaven forbid an accidental overdraft at $35 a pop, again, I digress).

A frugal life, a careful life, but not impossible for a clean hardworking soul with some old-fashioned determination and drive.

To do so at the Madrona, however, they will still need to tromp through the lobby of a building that also houses a detox center. Poverty being relative, the way we compare and rank ourselves to our surroundings, these ‘working poor’ are no better off for their labors.

Remember – this is not a Walmart cashiers starting wage we’re working with. This is a Walmart department manager or pharmacy tech, an entry-level cna, or a technical support rep at the call center (in Beaverton). Those jobs may not require a 4 year degree, but they do require skills and knowledge, sometimes a certification, and represent what could, in an ideally distributed world be called a career- if only they would pay the rent and put food on the table.

But here’s the rub… these jobs pay $11.50 an hour. That is what they pay. They will adjust for inflation, and barely match the increase in the cost of bread, but that is what they pay because that is the portion of the cost of production calculus that these ’some skills required’ positions merit. We need people to do them, but raising their wage to $15 or $20 an hour would only spread the increased cost over everything they touch. They would be right where they are now, no better, maybe even worse.

What are their other options?

A craigslist search on ’studio’ with a max price of $490 returns only 55 results. Many of them are $150-200/week rooms – overshooting the $490 per month price tag, the rest are far away from the central city (Oregon City, Wilsonville — adding hours each day of commute time to that $11.50/hour job if it’s in Portland proper). None of them are lovely places to live. Shared bath kind of situations.

So our $11.50 worker is left to pay upward of half their income, maybe even more, for a place that makes them feel like they aren’t junkies themselves. Because you don’t work your ass off every day to have to step over angry lumps wrapped in blankets on your way out the door to catch that 6:15 bus.

I do not mean to disparage… too much… it really is a good idea to turn old useless hotels into places where people can stay dry at night. But when they put Hoopers in the same building the Madrona became 176 units of great news for junkies. That’s what it is, and that’s ok… but that’s all it is.

Charging $450 a month for housing the alcoholics does not do anything to move the cost curve of housing in Portland relative to wages. The cna’s and pharmacy techs and tech support reps that are just squeaking by are no better off.

That’s why, imho – saying this is great news for affordable housing is….hell, Dan, it’s just bullshit…. once you get over the ‘living wage for everyone’ fantasy and see the reality of what wages are compared to how much it really costs to live indoors, the price for housing the folks who are going to live at the Madrona still is too high.