Sussex County Council checked progress on the moderately-priced housing initiative at the Feb. 1 council meeting.
At council’s bequest (last October), County Administrator Bob Stickels put together a committee to study the topic.
The committee included representatives from citizens groups, manufactured housing associations, Habitat for Humanity, InterFaith Mission, real estate professionals and various state and county agencies.
The committee had refined some of the program standards.
1) Applicant must be a permanent resident of Sussex County, for at least three years.
2) Applicant must be employed in Sussex County for at least the previous year.
3) Income cannot exceed 175 percent of the median – median family income is currently $49,700, so the max would be $86,975.
4) If the applicants sell one year later, they have to give back 90 percent of their profits, two years later, 80 percent…in ten years, no penalty.
5) Developers will be given consideration (up to plus 10 percent bonus densities, expedited application and public hearing processes) for projects with 30 percent or more moderately-priced housing.
6) The houses should be scattered throughout the development, not clumped.
7) They can be single- or multi-family, or manufactured homes.
8) The committee recommended the establishment of a fund to help with down payments, graduated based on income.
A handful of developers also attended the committee meeting (Caldera Properties, Carl M. Freeman, Dyer-McCrea Ventures and others).
Stickels outlined their comments, adding, “No one was in disagreement that there was a need for a program like this.”
However, the developers were strongly opposed to a mandatory program.
They recommended administration through an agency other than county government itself, perhaps the Sussex Land Trust.
Developers noted the necessity of a cooperative effort with lending institutions, which would have to complement the effort with affordable financing.
Lit Dryden, a Delaware real estate agent and broker for the past 30 years, took that a step further.
He cautioned council that the program couldn’t be predicated simply on income.
For instance, one applicant might have more available cash for the down payment, and be able to leverage better financing.
In addition, Dryden noted the wide variety of mortgage instruments on the market today (adjustable rate mortgages, buy-downs) and the variability of the prevailing interest rates themselves.
Under certain conditions, people within the moderately-priced housing income range could wind up with houses that weren’t so moderately priced.
“Developers are going to price at the highest possible point,” Dryden stated – not to pass judgment, but merely to illustrate the nature of the market.
Unless the program set a max cap on home value, he said it would be difficult to satisfy the targeted purchaser group.
Council Member George Cole questioned whether the initiative was anything more than a “feel-good” program.
Council Member Lynn Rogers advised further study, and said he hoped to gather more information at the National Association of Counties (NACO) meeting in March.
Stickels asked council’s pleasure. “Do you want a program, or just leave it to the Delaware Housing Authority, or do you want an ordinance,” he asked.
Council Member Vance Phillips suggested a go-ahead, saying, “This doesn’t have to be a full-blown program that’s going to change the landscape of Sussex County — it can be some pilot programs that we may want to tweak later.”
In the end, the consensus was to reconvene the committee to iron out a few more details.
However, with this year’s county budget looming large, and Stickels busy on other committees, council voted to pass the torch to Bill Lecates (Director, Sussex County Community Development and Housing Division).