The city’s housing shortage hasn’t gone uncovered. According to a recent report, Greater Columbus needs to build as many as 19,000 new homes per year in order to keep up with annual job growth. However, the current rate of construction is just over 8,000 annually. Columbus’ Department of Development and the Mid-Ohio Regional Planning Commission say that we need to drastically increase those numbers to maintain an adequate housing supply and keep prices down.
Columbus City Council and the Department of Development have been expanding one method in particular to increase the city's housing supply: the Community Reinvestment Area program (CRA). The main purpose of the policy is to incentivize the construction of more apartment complexes, but the property tax abatement program actually incentivizes the building of overpriced housing in low-income neighborhoods.
“Tax-abated properties are selling for much higher sales prices than local real estate values and are most likely only affordable to high wealth households,” Ohio State University’s Jason Reece and Vicky Abou-Ghalioum wrote in a 2020 study, which found the average tax-abated, two-bedroom house sold for $434,000 and required a household income of more than $130,000.
The study also found that these abatements stripped the communities of resources, particularly public schools, which rely on property taxes for their funding. “While the abatement programs have helped spur an influx of high wealth households into abatement areas, they degrade the public resources available to the nearly 30,000 children (of which more than half live in households with income under the poverty line) in abatement areas,” Reece and Abou-Ghalioum wrote.
“Columbus seems to be striving in every way to live up to the legacy of its namesake,” Linden community member and Communist Party organizer Scott Gann testified at the sole hearing for the CRA’s expansion to Dublin. “Taking advantage of the rich cultural traditions of our neighborhood in order to sell them off, leaving the people who built these places with nowhere to go.” (Columbus City Council approved the expansion in its final session in 2022.)
The CRA program provides a 100 percent property tax abatement for 15 years to projects that set 20 percent of their units below market value at a price the city deems affordable. The city currently defines affordable rent as 30 percent of the area median income for Columbus ($57,800), or $1,455 per month.
This definition of affordable housing has been contested by community groups such as Affordable Housing Columbus (AHC), which said these numbers don’t add up in a presentation at Capital Law.
“This is not designed for anyone living in Linden,” Mitchell Toomey from AHC said.
While the area median income in Columbus is $57,800, the median household income in South Linden is $28,610. A CRA housing development constructed in Linden would result in 10 percent of the units priced at $1,455 per month and 10 percent priced at $1,174 a month. These prices far exceed 30 percent of the area median income of Linden (roughly $715.25 per month).
“This is the affordable housing plan from the city,” Toomey said. “It’s ridiculous.”
The city's predicted population growth is predicated on a jobs boom in places such as New Albany, which attracted the Intel plant in part by granting the company a 100 percent, 30-year tax abatement. But New Albany and other nearby suburbs don’t have a plan to house the workers they’re pulling in.
“We have a housing system that has not been thought of regionally for what we need, and it has been these individual communities that determine their destiny within their boundaries [that] has led us to an overall infrastructure that’s not particularly diverse in housing typologies,” Erin Prosser from Columbus’ Department of Development said at a panel discussion about Intel’s impact on housing. “Our jurisdictional partners need to come to the table and have a conversation about how we build a 21st-century city.”
Columbus is continuing to look for other methods to make up for the housing shortage. Voters approved a $200 million bond issue to increase affordable housing stock for those making less than $50,000, but it’s unclear how effective this will be. “We simply do not have enough places for people to live,” Mayor Andrew Ginther said in announcing the bond issue in July.
The issue isn’t unique to Columbus. Cities across the country are experiencing housing shortages while continuing to subsidize higher-end housing. “Whose needs are not met by this policy?” Toomey said. “The most susceptible people. … This is just a program of gentrification.”
