Tax Dollars Wasted on Market-Rate Homes

We are in the midst of a debate about affordable homes in Montgomery County. Good.

Most people would acknowledge that Norristown and Pottstown have historically welcomed working-class families – namely, people with low-to-moderate incomes (less than $100K for a household of four, for instance). We could probably say the same for most of MontCo. Yet one of the more troubling revelations from September’s airing of Norristown emails was this exchange about “affordable housing” in the county seat:

“Other than affordable housing, is there anything possible for us?” Municipal Administrator Crandall Jones wrote in February to Jayne Musonye, director of planning and municipal development.

She answered, “I am reluctant to recommend using these funds …for fear of imposing ‘affordable’ requirements that goes against our vision for future housing in Norristown. Other funding sources address housing for the homeless population or people with disabilities.”

Jones responded, in a written statement to the Philadelphia Inquirer, that he and Musonye were not speaking for themselves.

“Anything we … articulate as the position … of the municipality results from the municipal council having deemed it so, not because any of our individual positions," he stated.

At the Montco 30% Project, we define homes as affordable based on the percentage of your income that goes toward rent or the mortgage. That figure, according to the federal government and policy experts, should be 30 percent or less. But in MontCo, more and more people are “cost-burdened.” Nearly 50 percent of renters spend more than 30 percent of their income on their housing, according to the county’s Homes For All report (2019).

Obviously, inflation has made that situation worse during recent years.

Priorities in Land Development: Tax Dollars Wasted

Based on recent actions by Norristown Council, such as redeveloping the grounds of the county’s only year-round homeless shelter and entertaining land development plans for market-rate housing near the courthouse, it looks like the strategy is to pursue rapid gentrification and revitalization. From a policy perspective, that is Council’s prerogative. Nonetheless, the Montco 30% Project believes that taxpayer dollars should not go toward subsidizing market-rate housing because that amounts to corporate welfare.

For example, Royersford’s riverfront redevelopment proposal along the Schuylkill River has already received approximately $2 million in RACP financing from Pennsylvania for site engineering and other preliminary site work. The vision, as put forth by owner Rick Lewis, is for a mixed-used public gathering place – complete with a restaurant/brewery, trail connections, pickleball court, and luxury apartments. Sounds good, right?

Here's an important question: In exchange for state funding, did Pennsylvania require any units to be set aside at below market-rate (aka: affordable)? No.

In Norristown, the story is similar – at least on paper. At 1 West Main Street (PNC Building), 24 market-rate apartments were built on the top floor, with another 20 underway on the second and third floors. Norristown is looking at bringing in a “food hall” on the ground floor. Again – much like Royersford – nothing wrong here, except that $800,000 in taxpayer money (from RACP) was poured into this site.

Rents at 1 West Main range between $1,175 and $1,750, according to Apartments.com.

When your money is spent, we should get apartments that are affordable. The chart below illustrates different percentages of area median income (AMI). For a household of four people, the AMI for the Philly metro area is $100,583. So, for an affordable development, such as Cornerstone at Pennbrook, most applicants are capped at 60 percent AMI. Anything above that, and they earn too much to live there (a few units will be market-rate at the proposed 60-unit Cornerstone).

Montgomery County needs more of this everywhere, including Norristown and Pottstown. Don’t let anyone tell you that this is “Section 8” because it is not. Section 8 refers to Housing Choice Vouchers, which we covered in a previous post.

The last word goes to a health care worker in MontCo who was previously homeless.

“Our residents need to be informed about what the wide range of homelessness looks like. Our residents need to understand the shame students face when there is no money for laundry or showering because the family car needs fueling up. Our residents need to see the greater picture of what other families face when living among communities that boast high income levels, educational resources and the opportunities that are within easier reach for those more fortunate. Our residents need to understand that accessibility to affordable housing in our Montgomery County school districts is a huge issue.”