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HUD   >   Recovery   >   Impact   >   Success Stories   >   Region 10   >   bellingham

Think “high rents” and you probably think of New York or San Francisco, Chicago or L.A.  But not Bellingham, a city of nearly 90,000, north of Seattle and just 20 minutes from the Canadian border.

Think again.  Thirty years ago, reports the City in its 2008-12 Strategic Plan, more than half its families were homeowners.  Only 48 percent do now and, proportionally, a third more families rent in Bellingham than in the state of Washington as a whole.

Lots of those renters are having trouble.   It starts, plain and simple, as a supply problem.  There are, for example, about 1,600 subsidized rental units and another 1,900 rental vouchers in Bellingham.  A lot, right?  But, Kie Reylyea of The Bellingham Herald reports, the wait for these units “can be as long as 6 ½ years.” 

Bellingham’s residential vacancy rate is just a smidgeon over 2 percent, even after an almost 32 percent increase in the City’s housing stock from 1990 to 2000.  Its vacancy rate is just half the statewide average and a fifth the nationwide rate. 

Scarce supplies of anything, of course, mean higher prices for that thing.  That’s certainly true in Bellingham.  Even before the national economy went south almost 59 percent of renter households spent more than a third of their income on rent with more than a third spending more than 50 percent.

The City’s well aware of the problem. This year it’s allocated more than $600,000 in HUD funds to rehab – and extend the useful lives – of five Bellingham Housing Authority apartment buildings with 223 units. It’s also committed more than a quarter-of-a-million dollars to help at least 20 elderly or low-income homeowners bring their houses up to code, thereby preserving stock.  And it’s partnering with the Kulshan Community Land Trust to acquire property to develop as affordable single-family homes that will, because of land trust requirements, remain so for generations to come.

And, yes, it’s committed to building new affordable housing.  Like the Housing Authority’s  51-unit Walton Place One apartment for working families just down the block from the transit center and convenient to job opportunities in.  From the get go, the Authority knew it would succeed, so much so that even before Walton Place One opened in July 2009,  work had already begun on the 40-unit Walton Place Two on a parcel next door then occupied by “an old an unattractive warehouse.”

The Authority’s always enjoyed considerable success in developing housing downtown.  Initially, the same would be true for Walton Place Two.  It won a Green Communities grant from the Enterprise Community Partners and a $5.8 million Washington Works grant.  The City, as usual, also stepped forward, providing HUD HOME funds and, just as importantly, waiving certain design and permitting requirements that could have added costs or made the project “undoable.”

Everything was set and the only outstanding question was whether Wall Street investors would buy the Low Income Housing Tax Credits that were the last component to the financing package.  In good times, they would have.  But, by 2009, the economy had gone south and credits that normally would have up to 90 cents on the dollar, brought only 70 cents.  The project stalled.

Fortunately, the President and Congress passed the American Recovery and Reinvestment Act, including the HUD-administered Tax Credit Assistance Program to “jump start”, affordable housing developments stalled or, even, scuttled because of investor skittishness.  Walton Place Two fit the bill. 

The almost $1.2 million in TCAP funds awarded by the Washington Housing Finance Commission, Authority Executive Director John Harmon told The Herald, “leveraged the rest of the money,” with every $1 it provided guaranteeing another $10 in investment in downtown housing.

And once the Authority closed the gap and got the go-ahead, it wasted no time. “Construction workers are putting the finishing touches” on the project, The Herald reported in January.  Residents should move in February.

“We tend to think of housing shortages as a big-city problem,” said HUD’s Northwest Regional Administrator Mary McBride.  “But it’s a problem everywhere.  What’s impressive about Bellingham is the creativity and tenacity of its efforts to preserve and expand the supply.  They never accept “never” as an answer.” 

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