Commissioners fund affordable housing in budget agreement

Commissioners Mike Hamby, Jesse Houle and Dexter Fisher have hashed out a budget agreement to fully fund the local government’s affordable housing investment strategy and other priorities while keeping property tax rates flat.

Mike Hamby
Commissioner Mike Hamby

View a PDF of the agreement.

Budget negotiations have been calm this year compared to last year, when Hamby and Houle crafted separate budget proposals in the weeks leading up to the vote. That led to a split commission, putting an immense amount of pressure on freshman Commissioner Tiffany Taylor to break the tie and make the final decision on the Athens-Clarke County budget. 

This year, Hamby and Houle are making an effort to ease tensions between them to make things easier for their colleagues. They sat down together with Fisher to develop a budget proposal they could all support.

Table of Contents

Hamby, Houle and Fisher’s agreement
Affordable housing
Capital projects
Other programs
Paying the bills
Next steps

Hamby, Houle and Fisher’s agreement

The budget agreement resulting from talks between Hamby, Houle and Fisher funds nearly every priority commissioners have, including the affordable housing investment strategy and various capital needs, while keeping tax rates flat at 12.45 mils.

Property taxes are measured on a thousand-point scale (i.e. “per mil”) instead of on a more typical hundred-point scale (i.e. “per cent”). 12.45 mils is the same as 1.245 percent.

Commissioner Jesse Houle
Commissioner Jesse Houle

Affordable housing

The big-ticket item in this proposal is an extra $4 million for affordable housing in addition to the $1 million acquisition “strike” fund already included in Mayor Kelly Girtz’s recommended budget. When combined with a payment in lieu of taxes from the Athens Housing Authority, the $5 million allotment will fully fund the local government’s affordable housing investment strategy for fiscal year 2025.

The affordable housing budget will be spent in three different ways. 

First, the acquisition strike fund will allow the local government to make loans to nonprofits and other community partners so they can buy up vacant properties across Athens that might not be in the best shape. After some renovation, the plan is for these townhomes, duplexes and apartments to be maintained by nonprofits like the Athens Land Trust as permanently affordable housing. 

“Affordable” rent in this context is defined by the local government as costing 30% or less than the monthly income of someone who makes at most 80% of the area median income.

When the nonprofits pay back their loan to the acquisition strike fund, the local government could loan the money out again to purchase another property. Commissioners have decided to allocate $1 million to this fund in fiscal year 2025.

The second part of the local government’s affordable housing plan is a gap financing fund for multifamily affordable housing projects. These projects often rely on the federal low-income housing tax credit to build affordable housing at a profit, but even with this tax credit sometimes this sort of development has difficulty making sense for investors. 

Dexter Fisher
Commissioner Dexter Fisher

Commissioners have decided to allocate $2 million this year towards the gap financing fund to subsidize affordable housing construction. As recommended in the affordable housing investment strategy, this fund has the potential to be leveraged many times over to provide the funding needed to build a significant amount of new affordable housing.

Finally, commissioners have also decided to allocate $2 million to a single-family affordable housing fund to encourage the development of new single-family homes for low or moderate-income first-time homebuyers. The single-family fund could also provide financial support to those families through downpayment assistance and financial literacy programs.

Capital projects

Commissioners also plan to finance one-time capital needs that are growing ever more urgent. 

They’ve decided to support the new judicial center project with an extra $1 million to help make up for construction cost increases. They’ll allow for the purchase of some new county vehicles, they’ll buy high-caliber body armor for police and they’ll also support solar energy upgrades, landscaping, pedestrian safety, traffic signal replacements and many other needs. They will also fully fund the local government’s commitment to the proposed Center for Racial Justice and Black Futures with $750,000 ($100,000 from the county’s general fund and $650,000 from the American Rescue Plan).

Other programs

Other funding increases include the public defenders’ office, which will get an extra $246,000 in this agreement. The ACC library will get $265,000 in additional funding, the District Attorney’s office will get an extra $90,000 (to make up for a lost grant) and the ACC Fire Department will get $700,000 to be shared with other public safety agencies to fund the impacts of their new collective bargaining agreement.

The ACC Sheriff’s Office will get funding for a salary study which Sheriff John Q Williams hopes will result in the raising of deputy pay to the equivalent of police officers. Deputies will get an increase to their hiring bonuses immediately, making their bonuses equivalent with the police department.

Paying the bills

In total, the new expenses come to $10.4 million more than what Girtz recommended in his budget draft. Fortunately, new projections from the finance department show that the local government will raise $1.7 million more next year than anticipated, but that still leaves a gap of $8.7 million.

The vast majority of the $8.7 million will come from the local government’s “rainy day” reserve fund without making it up in taxes.

Millions of dollars had been accumulating in the reserve in recent years due to skillful budgeting by the ACC Finance Department and accumulated interest from federal American Rescue Plan funding. Commissioners are proposing to drain their reserve fund almost down to the minimum required by ACC policy, which is two months of government operating expenses.

The reserve fund exists because it helps the local government maintain services in the case of a sudden emergency or economic recession.

The large reserve fund balance this year has helped commissioners avoid a sharp debate on whether or not to raise property tax rates, which would be politically unpopular.

Next steps

Commissioners will vote on this budget proposal at their meeting on June 5. 

If tradition holds, commissioners will hear from a number of angry homeowners at this meeting who will ask for lowering the property tax millage rate. No commissioner has strongly advocated to lower the rate as of yet with the exception of Commissioner John Culpepper, although several commissioners said that’s what they would prefer. Culpepper has indicated that this is his top priority, but he’s been absent from most budget discussions so far.

Typically, there would be very little chance for anything to change at this point in budget negotiations, but anything is possible this year including a last-minute attempt to lower the millage rate.

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