The CHA responds

The following are responses offered by Chicago Housing Authority officials to questions raised by The Chicago Reporter for its “Six More Years” Web exclusive.

In the letter that opens the tentative 2007 annual report, it is mentioned that a decline in federal funding has forced the CHA to adjust its budgets and move its “Plan for Transformation” deadline back to 2015. Will the U.S. Department of Housing and Urban Development continue to support the CHA’s Plan through 2015?

The CHA is in the process of asking for an extension of our agreement and we are hopeful that we will obtain approval before the end of the year.

Are CHA-earmarked “Moving to Work” funds guaranteed beyond 2009?

An extension of the CHA’s “Moving To Work” Agreement would apply to all provisions of the agreement-including things like level funding for capital subject to congressional appropriation and the ability to block grant all funding streams. The CHA both has funds and expects additional funds for use in the capital program. For example, the CHA has over $100 million unused HOPE VI funds, which will leverage 100s of millions more in public and private funding. In addition, the CHA expects to get approximately $100 million annually in capital funds and another $100 million annually from other government sources.

The letter also states that, “The design of [CHA] public housing units in mixed-income communities is of a higher quality than originally envisioned because we are committed to ensuring that those units are indistinguishable from adjacent market rate homes.” What specific features were not originally envisioned? How much more do they cost to add?

A number of elements related to quality and aesthetics contribute to increasing the cost of units. Examples in our case include the following: At nearly every new development the exteriors of the buildings are all-masonry for both rental and homeownership units and there is little or no distinction between rental and homeownership buildings on the exterior. The developments are each individually designed with a large variety of building facades, rooflines, brick types, etc., within each block so that they integrate seamlessly within the surrounding community and do not appear as one monolithic distinct development separate from the neighborhood. The buildings incorporate sustainable design elements that render them much more environmentally friendly than has typically been the case. Furthermore, in most cases the designs go beyond accessibility codes, making the developments more accessible to people with disabilities.

Also, in typical CHA developments, all rental units “float.” [This means that] in any given year a rental unit can be either a public housing unit, an affordable unit, or a market-rate unit. Accordingly, the interior finishes and features inside rental units have to appeal to all three categories, and public housing, affordable and market-rate rental units are indistinguishable in all respects as a result.

These and other elements add tens of thousands of dollars to the cost of each unit over and above and beyond the typical affordable housing unit. The cost of producing a unit varies from site to site and is also a function of the size of and number of bedrooms in units in a particular development-as well as being a function of material and design costs.

In the late 1990s, many numbers were floated about how long the Plan for Transformation would take. Looking back, would it have made more sense to allow 15 years instead of 10 from the very start?

No one has undertaken a redevelopment plan of this magnitude. Given the conditions the buildings were in, combined with a federal mandate to demolish 14,000 units, the CHA had to create an aggressive Plan. Given lessons learned along the way, the CHA believes it is better to extend the Plan and do things the right way, than keep to the 10-year timeframe and make costly mistakes.

By the end of 2009, CHA will have rehabilitated or constructed 20,000 public housing units and an additional 5,000 affordable and market-rate units. That is substantial progress. Delays in the timeframe occurred for a variety of reasons, some of which we have no control over. The primary reasons include: construction and labor costs have risen dramatically in recent years (note Dan Ryan project costs article in the Chicago Tribune). Second, federal funding has been cut back. Third, the CHA enhanced building materials and building design standards to meet market expectations.

In addition, the CHA slowed the pace of relocation, too, so that families did not have to move during the coldest months of the year. The CHA also took on additional projects not included in the original Plan. For example, the CHA is working on the rehabilitation or redevelopment of its six City/State properties, which, in total, included 929 project-based Section 8 rental units. These units were not originally part of the Plan for Transformation and are not part of the 25,000-unit count. Since they are adjacent to or on mixed-income sites and in serious disrepair, the CHA has decided to redevelop/rehab these sites. Currently, the CHA is acting as the developer for the rehab of three of those sites, rehabbing a total of 337 units, with a total redevelopment cost of $66.8 million.

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