Winston-Salem city leaders to vote on implementing affordable housing development guidelines on Monday

After months of planning and deliberation, Winston-Salem city leadership is set to vote on an ordinance that will shape affordable housing development in the years to come.

Since 2018, the city has funded 1,659 units to the tune of $46.9 million, using mostly ARPA and other grant funding sources. Most of the units are located in the Northeast Ward. 

Starting in May, the city has been working to update the affordable housing development project selection process at the request of council. The process has been suspended during that time. City staff have built a manual for developers; they will also offer training sessions for developers so they can learn how to submit a “responsive” proposal that can be considered by the city, according to the city’s Neighborhood Services Director Shantell McClam. The city will evaluate the viability of each proposal and then determine which funding sources the proposals are eligible for.

Now, the guidelines are ready for approval.

The move to approve them, as well as allocate $2 million toward this program, seemed like it would go through without a hitch, receiving an Oct. 14 recommendation from the four city councilmembers on the community development, housing and general government committee. During that meeting, Mayor Pro Tempore DD Adams said that in comparison to other cities that have already made headway on this, Winston-Salem is “out of step.” But when it moved to city council on Nov. 4, it stalled, with city leaders moving the decision to their Nov. 18 city council meeting.

What is the program?

The city has developed two processes: The Low-Income Housing Tax Credit (LIHTC) program and the city-owned lots and funding assistance program. According to the city’s Affordable Housing Ordinance, every multifamily project funded under the LIHTC program will have an affordability period of at least 30 years. These developments will be large scale or multifamily projects. These projects will cost an average of $15-20 million; this process allows developers to request gap financing. Sixty-five percent of the units funded must be affordable housing, or serve households that make 80 percent or below of the area median income. Winston-Salem’s AMI is $81,900, according to Fannie Mae’s AMI lookup tool. Of those units, 20 percent will be designated for tenants that make 30 or less AMI, 30 percent for those making 31-50 percent AMI and 50 percent for those making 51-80 percent AMI. The remaining 35 percent of the units will go to people who qualify for workforce or market rate housing. 

For developers who want to apply for the city-owned lots and funding assistance program, which will produce smaller scale or single family projects, average project costs will range from $750,000 to $2 million. Developers can request lots and gap financing.

Developers who want financial assistance from the city for their projects can pitch proposals that would develop housing on a minimum of three lots. However, McClam clarified during a Nov. 13 information session that that didn’t apply if the developer is looking to subdivide a property or increase its density with duplexes, triplexes, etc. There’s no maximum amount for lot requests.

During the city council meeting, East Ward Councilmember Annette Scippio expressed concern over the minimum lot requirement, worried that they wouldn’t be “motivating people to get into the development process.”

“It seems that we are favoring people who are already established.” That made her “uncomfortable.” McClam reiterated that they would be extending a hand to developers by offering proposal submission training.

These guidelines will apply to developers who are looking to build new as well as rehabilitate older housing. Projects must be completed within a two year time frame.

Developers also need to make sure that their properties are being built near resources such as grocery stores, emergency services and transportation. Some councilmembers have argued that downtown needs more housing, such as Northeast Ward Councilmember Jeff MacIntosh. But the problem is that development isn’t being encouraged in downtown spaces because there aren’t resources such as grocery stores, he said. Instead, housing gets pushed to the suburbs where there are more resources. But pushing housing further away puts a strain on transportation services, he argued. There’s a Food Lion around half a mile to the east of Highway 52, a Publix two miles west. But there’s nothing really substantial in the center city. It does seem like a “chicken and egg, kind of a Catch-22 deal,” MacIntosh went on. 

“If you’re going to attract a grocery store, you’ve gotta have rooftops,” he said.According to the city’s downtown plan, which was approved in December 2023, over 4,000 housing units have been built downtown during the last 20 years. However, most of them are “mid-rise garden-style apartments for rent at a price that is too expensive for many to afford.” The plan recommends advocating for more affordable housing and pursuing the development of a greater variety of housing types, including “high-rise, townhomes, and single-family home types suited for an urban environment.”

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