Nine years—that’s how long it’s taken D.C. to produce 11 pages of pledged regulations to save affordable homes.
In her annual State of the District Address last March, D.C. Mayor Muriel Bowser promised that her administration would begin to implement a 2008 city law designed to preserve low-income housing that is at risk of disappearing.
The law, Bowser explained, allows D.C. to “purchase, not take” such properties. “This will be the first time we have a strategy in the rules, and the funding in the District to use” the District Opportunity to Purchase Act, Bowser said.
The funding is still up in the air, but the rules are at last on paper. Last Friday, the D.C. Department of Housing and Community Development released proposed regulations for DOPA, as the law is also known. Through DOPA, D.C. can buy residential properties with five or more rental units where at least one-quarter of the units are affordable for families earning up to half of the area median income. Currently, that equals $55,150 a year for a household of four.
Although the regulations have yet to be finalized, they’re poised to become another tool at D.C.’s disposal to keep its existing affordable housing stock in the midst of citywide gentrification. The D.C. Fiscal Policy Institute found in 2015 that from 2002 to 2013 the District lost about 50 percent of its units that were renting for under $800 a month. Those units represented the bottom fifth of the rental market, and they shrunk in total from nearly 60,000 to 33,000.
DOPA would theoretically stem this tide by letting the District partner with trusted developers to redevelop for-sale properties that have a sizable number of affordable apartments, “on an expedited basis,” according to DHCD. The law mirrors and complements D.C.’s unique Tenant Opportunity to Purchase Act, which allows tenant associations to buy their buildings or “assign” their purchase rights to third-party developers when landlords move toward sales.
Under the proposed rules, tenant associations would have to exhaust, forego, or decide not to exercise their TOPA rights before D.C.’s DOPA rights would trigger. Owners would have to inform tenants and D.C. of their intent to sell.
DOPA has sat on the books since 2008, when then-Ward 8 Councilmember Marion Barry introduced legislation to establish it, and the D.C. Council unanimously approved it. But in the aftermath of the economic recession—during which the District’s affordable housing funds decreased—three mayoral administrations, including those of Adrian Fenty and Vince Gray, did not establish the required regulations and administrative processes to realize DOPA.
That didn’t prevent other paperwork from arising. According to UrbanTurf, DHCD received 121 DOPA notices from fiscal year 2013 to fiscal year 2015, chiefly for properties in Ward 4, in the same way that it receives TOPA notices.
Housing advocates pressed for action. A 2014 report by the Urban Institute recommended instituting a framework for DOPA as an “immediate action” for then-Mayor-Elect Bowser. A D.C. Preservation Network paper also urged the District to “implement DOPA without further delay.” And last year, Claire Zippel, an analyst for DCFPI, called DOPA “a potential game-changer in the city’s ability to preserve affordable housing” in testimony to the Council on DHCD.
“I see a time down the road when DOPA is going to save a lot of units,” Steve Glaude, who directs the Coalition for Nonprofit Housing and Economic Development and headed community outreach for Gray, told City Paper in 2015.
In 2016, a “housing preservation strike force” formed by Bowser and composed of advocates, District officials, and community organizations included DOPA regulations as one of six recommendations to maintain low-cost housing.
But to promote this goal through DOPA, officials have more work to do. For starters, DHCD must solicit developers via requests for proposals, and clear qualified developers for participation in DOPA projects. Selection criteria are to include developers’ records managing rental housing, their financial resources, and various legal requirements.
The District also has to figure out how to fund the law, which could cost millions of dollars per project—depending on a particular property’s asking price, condition, size, location, operating expenses, vacancy rate, and rents. In choosing whether to pursue a DOPA deal, DHCD would consider these factors to assess the terms of a given sale.
The draft rules provide the District 30 days to inform a property’s owner and tenants of its interest in acquiring that property, a minimum of 150 days to negotiate a sale contract, and 60 days to settle after a sale contract is ratified.
Future rents would be subject to allowable increases under D.C.’s rent control laws, but would otherwise remain at the prices they were as of the date a landlord notified the District, in writing, of its intent to offload a given property.
To make DOPA a reality and an effective safety net for affordable housing, the District may have to designate more money for its Housing Production Trust Fund. The HPTF provides gap financing for both new construction projects and preservation projects, including those under TOPA. The Bowser administration and the Council have allocated $100 million a year to the fund. That’s supported thousands of units, but advocates have demanded more funding.
Nonetheless, last March, the D.C. Auditor found problems with DHCD’s management of the fund, including unpaid loans, uncertified income requirements, and missing documentation. The audit covered 14 projects over 16 years.
Public comments on the draft DOPA regulations will be open until Jan. 22, and DHCD says it will host a briefing on them at its Anacostia headquarters on Jan. 9. The department says it expects to finalize the rules in “spring 2018.”