Heartening Start for Affordable Housing : Agency’s Momentum Will Help Ease Urgent Need

Orange County, where dwellings are among the costliest in the nation, is now home to an innovative nonprofit agency aimed at developing low-cost residential projects. The new Affordable Housing Clearinghouse, which will aim to foster cooperation between lenders and housing advocates, could not be more welcome.

Sixteen lending institutions donated $162,000 in seed money--from $4,000 to $50,000 each--to get the clearinghouse under way; others are expected to come on board in the near future. An executive director is being sought and specific projects are under discussion. So much has happened in so few months, in fact, that housing advocates say they feel almost breathless. It’s an encouraging start.

The inception of the clearinghouse came when a group of housing advocates, brought together by the Orange County Human Relations Commission, met to talk about what could be done to foster more affordable housing for the elderly and disabled and low-income families. The county’s housing situation has long been a serious concern to social services agencies. Orange County’s median housing prices are much higher than surrounding counties and rentals also are costlier. The lack of low-priced housing is blamed in part for the county’s estimated 10,000 homeless people.

Under federal law, banks and savings and loans already are required to assess the needs of the communities in which they operate and help provide loans to affordable-housing projects. But that can be risky, especially for smaller lenders. Meanwhile, the good intentions of nonprofit housing advocates often are stymied by government regulations or hampered by a lack of knowledge about how to go about getting financing for identified projects.

In order to put the pressure on lenders, the federal government now makes available previously private information on how lenders have complied with low-cost housing requirements. In other localities across the nation, that has resulted in incidents in which housing advocates have sought to publicly embarrass banks and savings and loans that haven’t satisfactorily complied.

In Orange County, nonprofit agencies took a different tack: They invited lenders to help them find ways to foster affordable-housing projects. The response was gratifying and the upshot was a separate nonprofit agency unlike any in the state.

Clearinghouse leaders say they won’t wait for projects to come to them but will seek them out from community groups, lenders and government agencies. Once screened for viability, the clearinghouse will try to put together a financing package. They hope to increase the chances of building projects that might be considered too risky by spreading that risk among lenders.

Board members for the new agency say they expect to see a project on the drawing boards within a month. In addition, workshops are planned to help nonprofit organizations get their projects through the bureaucratic maze.

The clearinghouse offers a positive, no-nonsense approach to the frustrating problem of building and preserving low-cost housing. At a recent press conference announcing creation of the clearinghouse, one member said she was impressed by lending institutions that saw it not as “another charity to support” but a viable entity for business development. She added that lenders moved so quickly on the idea that nonprofits had to race to keep up.

It is important to keep that momentum going. The need for low-cost housing is urgent.