Action Plan

The Action Plan for Program Year 1995 (July 1, 1995 to June 30, 1996) includes projects that address each of the needs and priorities in the Five Year Strategy. More than 25 projects comprise the one year action plan. The Action Plan included applications for $1,485,000 in Community Development Block Grant (CDBG) and $724,000 HOME funds.

Citizen Participation

The Salem City Council appointed a ten member Housing and Community Development Advisory Committee to develop the plan. The HCD Committee established an extensive citizen participation process to develop the new strategic plan. An important vehicle for citizen participation was the involvement of Salem's neighborhood associations. All nineteen neighborhood associations were provided information about the new plan. Staff attended neighborhood meetings as requested. Housing and social services agencies were invited to submit data and to appear before the committee. As result a number of priorities were added to the Five Year Strategy and several projects were included in the first One Year Action Plan.

The Salem-Keizer urban area is the center of an MSA which puts pressure on the existing housing as newcomers look for housing in competition with those already in the area.

Salem-Keizer is a community of older neighborhoods, an institutional and administrative center, the center of a growing MSA, potentially a location for high speed commuters, and one of the centers of a rich agricultural area with a large number of low-income farmworkers. All of these factors have an impact on the existing and future supply of housing which is affordable and supportive of the existing and future needs of a growing population.

The combined 1990 population for the cities of Salem and Keizer was 129,670. In 1994, the combined population was estimated to be 142,525. This represents nearly half (46%) of the total population of Marion and Polk counties.

Salem and Keizer both grew at a very rapid rate (20.8% and 17.7%, respectively) during the 1980's. Both cities grew at more than twice the statewide growth rate of 7.9% for the decade. With the exception of the recession in the early 1980's, the area experienced steady growth from 1980 to 1990. The growth trend has continued since 1990. Salem grew 8.5% since 1990, and Keizer has grown 15.5% in that period. Salem is growing at a considerably slower rate than for 1980-1990. The Keizer growth is only slightly below it's ten year growth rate.

The total share of minority groups in both Salem and Keizer has increased during the past decade. All minority populations in Salem and Keizer increased by at least 50%. Most notably, Salem's Hispanic population doubled and the Asian/Pacific Islander population almost tripled. In Keizer, all minority populations, except Asian/Pacific Islander, at least doubled. However, in 1990, all minority populations combined constituted less than 8% of the total population of Salem and Keizer.

Conditions

Perhaps the most significant change between 1980 and 1990 in the Salem-Keizer housing market has been the general tightening of vacancy rates, even though the total number of units in the market increased by 16% over the decade. Minimum vacancy rates of 2% for owner-occupied housing and 5% for rental housing are commonly considered necessary to avoid a constricted housing market.

Substandard units include all those rated in the survey as fair (one or more repairs needed), and poor (major repairs or renovation needed), and units that are boarded up, partially burned, or in similar distressed condition. Substandard units suitable for rehabilitation include only those rated as fair. Approximately 9% of both renter- and owner-occupied housing within Salem is considered to be substandard. An equal 8.5% of the total rental housing and owner-occupied housing within the city is suitable for rehabilitation. This equates to 93% of the substandard housing being suitable for rehabilitation. This probably represents a minimum number of units in need of rehabilitation.

Typically, a greater percentage of multi-family rental units are in need of rehabilitation than are owner-occupied units. The fact that there is a greater number of substandard owner-occupied units than renter units is presumed to be due in part to Salem's mandatory multi-family inspection program in which all units are physically inspected every five years. There is no mandatory inspection program for one to three-unit properties.

The higher rates of substandard housing units in Salem as compared to Keizer are due to several key variables. First, and foremost, Salem's housing stock is older and more diverse. Second, a larger percentage of Salem's housing stock is renter-occupied as opposed to owner-occupied units. Third, Salem's population is more diverse and includes more people with lower incomes, thus there may be more delayed maintenance of Salem's units than Keizer's. Finally, the housing condition survey used an external windshield survey; thus more of the maintenance problems were noted than might otherwise be the case, and internal problems were obviously not a consideration in that condition survey.

In Salem, 31% of all households have some type of housing problem, with 78% of very low income households and 71% of low income households having housing problems. Low income, large related households (5 or more persons) are particularly susceptible, with over 95% of these households having housing problems.

One-quarter of all households in Keizer are identified as having some type of housing problem. The percentages of low and very low income households with housing problems both exceed 75%. As in Salem, large related households are most affected by housing problems. The definition of "any housing problem" is broad and subjective, but this information is helpful in identifying areas where a large percentage of housing units have problems and to determine the extent that lower income households need housing rehabilitation assistance.

Housing Market Conditions

Construction activity in the Salem-Keizer area has been healthy in recent years, although the location of construction has been predominantly outside the central portions of the City. As discussed earlier, much of the newer multi-family units under construction have been in the higher rent range, providing no relief to lower income individuals. In addition, rents for existing units are currently increasing by at least 3% annually. Monthly rents exceed 30% of total household income for approximately four out of ten households in Salem and three out of ten in Keizer.

A low vacancy rate for rental units also contributes to the increased rent levels. With between 7.5% (Keizer) and 9% (Salem) of the renter-occupied units considered substandard, it is fair to assume that these units are in the affordable range. The low vacancy rate combined with high rents creates a situation where there is little incentive for the owner to repair units. Tenants may be reluctant to request repairs, assuming that owners may further increase rents. The market clearly is in need of additional low and moderate-income rental units.

According to the 1990 Census, the median value of owner-occupied homes in Salem is $60,300; often considered a relatively affordable figure. However, it must be noted that a $60,300 home, assuming a 10% down payment of $6,030 (often beyond the means of a first-time home buyer), requires a monthly payment of approximately $450. It should also be noted that the third quarter median sales price of all homes in Salem and Keizer was $92,839, according to the Salem Multiple Listings Bureau. The supply of affordable owner-occupied homes in good condition is small. Salem's Single Family Rehabilitation Program helps in repairing existing owner-occupied units, but at an average of forty units annually, it cannot dramatically impact the substandard housing stock. The Single Family program also does not assist the first time homeowner (because equity is seldom high enough to qualify for assistance), except for potential repairs to an already purchased substandard unit.

Affordable Housing Needs

Analysis of priority needs information demonstrates that more than 70% of all very low income households in Salem have cost burdens exceeding 30% and more than 25% of all households have cost burdens exceeding 50%. Similar percentages apply in Keizer and suggest that affordable housing for low income households is difficult to obtain.

The number of low and very low renter households exceeds the number of housing units affordable to them. Of particular note, the number of very low income households exceeds the available supply by over 1,900 households.

The supply of affordable rental units for those with severely low, very low and low incomes, combined, exceeds the number of households in those categories, combined, by slightly more than 6,800 units. Approximately 63% of the combined severely low, very low and low income households have 30% rent burdens. 24% of these households combined have 50% rent burdens; by and large, those with the lowest incomes have the most severe rent burdens.

It should be noted at this point that most residents of assisted housing are either very low or low income households, and that almost all of them would not be included among the households with a rent burden in excess of 30%. (A small number of Section 8 voucher recipients may have a 30%± cost burden.)

Similarly, among the low income owners, in spite of what appears to be an adequate supply of housing to meet their needs, 59% have a cost burden of 30%±, with severe cost burden problems (50%±) for these low income owners falling sharply to 28%. It is interesting to note that the percentage of low income homeowner households with severe cost burdens slightly exceeds that for renter households. The non-elderly owners have a higher percent with cost burdens, though they are greatly outnumbered by the number of elderly owner households with cost burdens.

What this indicates is that equilibrium does not exist between household income and affordable housing. The five-year projection is for no major changes in this "affordability gap."

Homeless Needs

Homelessness is a growing problem in the Salem-Keizer area. As poverty is a potential indicator of homelessness or potential for homelessness, the 1990 Census shows that 14% of all households in Salem and 7% in Keizer are living below the poverty level.

Public and Assisted Housing Needs

The City of Salem, through the Salem Housing Authority (SHA), administers a variety of publicly assisted housing programs for low income families and individuals. Families who are displaced, living in substandard housing, or paying more than 50% of their income for rent receive statutory occupancy preferences for publicly assisted housing. Homeless families may receive an occupancy preference by virtue of their homelessness.

At this time, there are no known assisted housing units in the City of Keizer. However, Keizer is within the boundaries of operation of the SHA and individuals receiving housing assistance through the Section 8 voucher programs can rent housing in Keizer, and there are Section 8 tenants living in Keizer.

There are 501 units of public housing in Salem, owned or managed by SHA, making the SHA the largest provider of housing in the Salem-Keizer area.

Barriers to Affordable Housing

The primary barrier to implementation of the plan is inadequate communication among the various entities who will have responsibilities to carry out portions of the plan. As indicated elsewhere, reduction of these barriers is an important element in the Five Year Priority Needs developed by the Committee.

A focus on affordability and incentives to encourage market participation in housing for low and moderate income households will be supported. The Salem Department of Community Development will promote efforts in this area. Considerable activity is already underway to foster institutional cooperation to implement this Housing and Community Development Plan. Additional efforts will be made to enhance this activity.

Fair Housing

The YWCA of Salem has received funds for a comprehensive fair housing education and counseling project which will respond to the community's need. The project will serve Salem, Keizer, and six surrounding counties. The project will provide a variety of housing services, including mortgage default counseling, homebuyer counseling, housing locator and assistance, and assistance with housing discrimination complaints. The YWCA will accomplish this through an existing network of housing providers. The project cost is estimated at approximately $288,000, for an 18 month project. Federal funds will be about $156,000 of that amount with the remainder provided by in-kind services and revenue from other sources.

Lead Based Paint

Minimal anecdotal information is available on the incidence of lead-based paint hazards in the Salem-Keizer area. According to the 1994 CHAS, a total of 8,738 low-income owner-occupied households and 10,142 low-income renter households in Salem are estimated to reside in units that have potential for lead paint hazards; and there are 1,015 very low income renters living in pre-1940 housing units--representing those probably most at risk. In Keizer, 1,945 owner-occupied units and 1,545 rental units may have lead-based paint hazards; there are only 148 very low income renters in Keizer living in pre-1940 housing.

As indicated above, a small number of persons have been identified from screening at local health clinic in the community. Records from the Oregon Department of Health related to testing of individuals for levels of lead in their blood indicated that approximately 40 persons were above the acceptable level. These persons were self selected.

As indicated above, the Salem Housing Authority has tested all 337 public housing units in the Salem-Keizer for lead-based paint. Except for minor areas in four units, all units tested negative.

Community Development Needs

1. Infrastructure improvements including but not limited to lighting, walkways, street rehabilitation, and recreational facilities are needed in some neighborhood locations.
2. A wide distribution of affordable housing in the community using infill sites where possible.
3. Rehabilitation of existing housing, where necessary, is an important neighborhood need.
4. A variety of community based services including social services, services related to jobs, and transit services are needed in neighborhoods.

Coordination

The Housing and Community Development Plan was prepared by the City of Salem Department of Community Development The Plan was adopted by the City of Salem and the City of Keizer. Marion and Polk Counties were included in the consultation process.

Vision for Change -- Overall Goals

The overall five year needs and priorities are presented as a continuum of care moving from homeless persons through permanent housing with supporting neighborhood improvements.

The potential total number of households assisted during the five year period is estimated as follows:

The estimate shown above includes 35 households each year assuming that each household is on the program for only one year.

Sixty (60) percent of these units would be targeted to households with a cost burden of greater than 30% of income. An additional twenty (20) percent is targeted to households with a cost burden greater than 50% of income. Persons with "physical defects" and households that are overcrowded are allocated 10% each. Of course, these categories can overlap.

In the renter population, resources are allocated 40%-small families, 40% large families, and 20% elderly. Again, the small family and elderly populations could need the same type of housing.

Housing and Community Development Objectives

1. Infrastructure improvements including but not limited to lighting, walkways, street rehabilitation, and recreational facilities are needed in some neighborhood locations.
2. A wide distribution of affordable housing in the community using infill sites where possible.
3. Rehabilitation of existing housing, where necessary, is an important neighborhood need.
4. A variety of community based services including social services, services related to jobs, and transit services are needed in neighborhoods.

Housing Priorities

1. Additional affordable units need to be produced in all portions of the housing continuum which includes shelters, transitional housing, and permanent housing.
2. Populations which have needs for additional units include but are not limited to homeless families or families at risk of becoming homeless, children and juveniles, and housing with services for seriously mentally ill persons (SMI).
3. Training opportunities and technical assistance should be provided for Nonprofit 501(c)(3) organizations to improve their capacity to develop and manage affordable housing programs.

Non-Housing Community Development Priorities

1. Projects which are currently in the Capital Improvements Program (CIP) should be analyzed to determine eligibility for CDBG funding and possibly repositioning on the CIP list. Additional projects submitted by neighborhoods should be considered for inclusion on the list as funding becomes available.
2. Neighborhood safety issues should be addressed to the extent possible based on project eligibility and availability of funds.
3. Priority neighborhoods should be established based on criteria which select low income neighborhoods and the neighborhoods desire to stabilize itself as indicated by neighborhood input.
4. A mix of housing types and price levels should be located in neighborhoods.
5. Affordable housing should by distributed throughout the community to the extent feasible.
6. Infill sites should be used to the extent feasible.
7. A neighborhood based homebuyer program should be encouraged.

Anti-Poverty Strategy

The anti-poverty strategy is best represented through the combined efforts of agencies which serve the Salem-Keizer area, working with and assisting households who are low income, homeless or threatened with homelessness. The emerging goals of this strategy include:

• mobilization of human and material resources from local, state and federal sources;
• capacity building through coalitions of public and private service providers;
• prevention through early intervention; and
• encouragement and empowerment toward independence and self-sufficiency.

Housing and Community Development Resources

Community Development Block Grant (CDBG) program funding can be utilized for neighborhood revitalization; provision of residential care facilities and other forms of special needs housing; and activities to aid very low and low-income families including the rehabilitation of rental or homeowner units, provision of emergency housing repair loans or grants, housing-related counseling services, and assistance with site purchase and other front-end costs associated with packaging housing projects for special needs and very low/low income households.

The Federal Home Loan Bank offers three programs to fund affordable housing, including the Affordable Housing Program, the Community Investment Fund and the Challenge Fund.

The Family Self-Sufficiency Program authorized by the National Affordable Housing Act, directs local housing authorities to use Section 8 assistance together with other public and private resources to provide supportive services to enable families to achieve economic independence and self-sufficiency.

Federal Low Income Housing Tax Credits (LIHTC) are available and can be sold to investors to generate below market rate private funding for new and rehabilitated rental housing projects and homeownership opportunities.

The HOME Investment Partnerships Program is a flexible grant program available to cities, urban counties and states. Funds can be utilized for acquisition, rehabilitation, new construction, tenant-based assistance, home buyer assistance, planning and support services.

The Mental Health and Developmental Disabilities Services Division of the Oregon Department of Human Services provides grants to be used in conjunction with other grants (federal and state) and low interest loans to provide affordable rental housing for SMI persons who have very limited incomes.

The Oregon Housing and Community Service (OHCS) Department offers the Federal Low Income Housing Tax Credit program and Low-Income Rental Housing Fund.

The primary local government providers of assisted housing services are the City of Salem Department of Community Development (DCD) and the Salem Housing Authority (SHA). Both agencies utilize federal and state funds and programs; and the SHA has utilized private funding in the development of housing projects.

Coordination of Strategic Plan

There are a growing number of nonprofit organizations in the area. These organizations are important as coordinators and advocates for housing as well as services to low income households in the community. One of the major recommendations of this plan is to strengthen these organizations and provide support to increase their capacity during the five year period. Private financial institutions will be encouraged to provide additional affordable housing.

In the area of intergovernmental cooperation, the Cities of Salem and Keizer are members of a HOME consortium. The Salem Housing Authority can operate in both Salem and Keizer. Oregon Housing and Community Services (OHCS) also works in Salem and Keizer.

Description of Key Projects

Housing priorities are addressed by the following programs and projects:

1. The single family, homeowner occupied housing rehabilitation project is continued in 1995 at an increased funding level.
2. The homebuyer project for 1995 supports the expressed priority need to expand homeownership opportunities throughout the community and to preserve existing housing stock.
3. Several projects will increase the supply of affordable housing. These include the Salem Self Help Housing, Habitat for Humanity, Salem Housing Authority-Parkway Village, and Chemeketa Non-Profit Housing, Inc. projects.
4. Special needs housing requirements are addressed in several projects as well in 1995. Projects which address this area of need include Alphabet House, Shangri-La, and Spruce Villa projects.
5. Chemeketa Non Profit and Salem Community Development Corp. are jointly sponsoring a project to construct a 3 bedroom rental house.

Non-Housing Community Development Needs and Priorities are also addressed in the Salem One Year Action Plan. Projects are included in the plan which address needs for infrastructure rehabilitation and improvements such as walkways, street lighting, rehabilitation of recreational facilities, and the special project for removal of architectural barriers. The City also allocates Community Development Block Grant funds to public service activities.

Locations

The housing projects meet the twin objectives of preserving existing affordable housing in low income neighborhoods and dispersing additional affordable housing and special needs housing throughout the community.

The non-housing community development needs are located in the eligible neighborhoods. These projects will support efforts of the Neighborhood Associations in low and moderate income areas to improve their neighborhoods. These projects encourage neighborhood residents to take other actions which will improve the neighborhood.

Lead Agencies

The lead agency is the City of Salem Department of Community Development. The Department is working with the City of Keizer as part of the Salem-Keizer Consortium and numerous non profit agencies.

Housing Goals

The total number of units to be assisted was multiplied by an estimated cost per unit to arrive as a five year dollar estimate. Each annual goal would be 20% of the five year goal. This annual goal represents approximately 145 units that would be assisted each year in all programs.

Maps

MAP 2 depicts points of interest and low-moderate income areas.

MAP 3 depicts points of interest, low-moderate income areas, and minority concentration levels.

MAP 4 depicts points of interest, low-moderate income areas, and unemployment levels.

MAP 5 depicts points of interest, low-moderate income areas, unemployment levels, and proposed HUD funded projects; in addition, a table provides information about the project(s).