After what was shaping up to be a contentious legal fight, an agreement between Charleston officials and the Charleston Citywide Local Development Corp. turned out to be a big win for affordable housing in the city.
In March, Charleston Mayor John Tecklenburg and former Mayor Joe Riley sued LDC over funds tied to a 1984 deal that helped finance the construction of the Charleston Place hotel.
The city initially gave $10 million in federal grant money to the LDC, which was then loaned to Charleston Place developers. When that money was paid back with interest — a total of more than $22 million — to the LDC in 2016, city officials reasonably asked for their share back.
LDC apparently had planned to use it for small business loans across the Lowcountry and elsewhere in South Carolina, however, and negotiations turned problematic, prompting the lawsuit. Fortunately, the situation was resolved relatively quickly.
The resulting deal, which was approved last month, allocates $10 million for Charleston’s attainable and workforce housing efforts alongside $9 million for the LDC to loan out for similar projects and about $3 million for the LDC’s other small business loan initiatives.
Taken together, the deal nearly doubles the $20 million that Charleston voters approved for affordable housing in 2017.
That would ideally translate into hundreds more apartments, townhomes and other residences targeted at people earning between 30% and 120% of the area median income, or between $22,000 and $89,000 for a family of four.
This is crucial because home values in the Charleston area and particularly within city limits have risen much more quickly than salaries over the past several years. The median home price stands just over $300,000, which is out of reach for families earning the average income.
So far, seven housing developments with a total of at least 630 units have been slated for the $20 million from the 2017 referendum, according to director of Housing and Community Development Geona Johnson.
The LDC funds are expected to provide additional assistance for those and new efforts.
It’s important that the city get as much bang as possible for those bucks. A Charleston County housing task force estimates that the region needs as many as 5,200 new housing units — about half affordable and about half market-rate — over the next 10 years to keep up with expected demand.
Even if those numbers are wildly overestimated, housing is likely to remain a daunting challenge for the foreseeable future.
It’s also important that new homes not exacerbate existing problems like flooding and traffic congestion, both of which are priorities for Charleston’s affordable housing initiatives.
Proposed projects were ranked on a variety of criteria including proximity to transit and walkable amenities and environmental sustainability and resiliency. Half of the planned units are downtown, where home prices and rents are particularly high.
Even with the extra funding from the settlement with LDC, Charleston will still have a lot of work to do to keep up with demand for affordable housing. But the housing built with that money will make all the difference in the world for a few hundred families.