Amid skyrocketing rent and home prices and a relentless supply shortage, advocates are hopeful that an infusion of hundreds of millions of federal relief dollars can finally make a dent in Nevada’s affordable housing crisis.
The state legislature’s Interim Finance Committee on Thursday voted to allocate the first half of a $500 million investment in affordable housing that Gov. Steve Sisolak announced in February, sending $250 million in American Rescue Plan Act funds to the Home Means Nevada initiative to pay for new affordable housing units and preserving units already in the affordable housing tax credit program.
“This isn’t a question of should we or shouldn’t we. Instead it’s a question of what happens if we don’t invest in housing. The answer presents itself everyday in our current environment,” Bill Brewer, executive director of the Nevada Rural Housing Authority, told the committee of lawmakers. “We are at a place of crisis because of decades of uphill challenges. But we have a once in a lifetime opportunity to reduce this incline.
The affordable housing issue in Nevada has been building for years, and has become acutely problematic since the onset of the COVID-19 pandemic.
Nevada ranks last in the nation when it comes to affordable housing availability for extremely low-income households — those who earn 30 percent or less of the area median income — according to data from the National Low Income Housing Coalition. The state has just 20 affordable rental units available for every 100 extremely low-income households, an overall deficit of more than 84,000 affordable units for those residents, according to the coalition’s data.
Waiting list for housing
Frederick Haron, chief administrative officer of the Southern Nevada Regional Housing Authority, said the agency has a waiting list of approximately 29,674 applicants for the authority’s programs.
The housing dollars allocated Thursday will “move the needle and begin to close the gap between the affordable housing need and the current housing stock,” said Arielle Edwards, government relations manager for Nevada HAND, a nonprofit affordable housing developer.
Rental rates and home prices have accelerated at astronomical levels in Southern Nevada. A report released last month by Zillow showed that Las Vegas had the 4th highest rental rates out of 50 metro areas tracked, with the average rate jumping nearly 33 percent from February 2020 to February 2022.
Home prices meanwhile continue to hit record levels, climbing to $460,000 in March — a mark that was 26.7 percent higher than March 2021.
It’s not just an issue in Clark County, either.
The cost to rent a modest, one-bedroom apartment in Northern Nevada has doubled over the last six years, said Heidi McKendree, the interim executive director for the Reno Housing Authority.
“We do have a crisis and it needs to be addressed,” Assemblywoman Maggie Carlton, D-Las Vegas, said.
How the money will be used
The funding for the Home Means Nevada initiative will go mostly to build new affordable housing units and preserve already existing units, Steve Aichroth, administrator of the Nevada Housing Division, told the committee.
“This initiative will allow for the new construction and preservation of desperately needed affordable homes, create and reinforce homeownership opportunities for our Nevada family, and secure land opportunities for future development of affordable homes,” he said.
The preservation aspect would involve rehabbing and refreshing units that were built using the affordable housing tax credit, he said. Units built with those credits must meet certain affordability measures for 30 years.
Aichroth said that the funding will let the state renovate thousands of those units that are nearing 20 years old since being built. By doing so, it will restart that 30-year clock for meeting the affordability requirements.
Edwards, from Nevada HAND, said it has 700 affordable housing units under construction or rehabilitation currently, and that it is “ready with projects in the pipeline that potentially benefit from these funds.”
Other programs approved
The finance committee allocated a total of $585 million in federal relief dollars from the American Rescue Plan on Thursday, including the $250 million for the housing initiative.
Lawmakers also approved $203 million that, along with other federal grants, will go toward projects to expand access to broadband internet across the state.
Several nonprofits will also receive a chunk of the funding that was approved Thursday, including a $2.6 million grant for the Legal Aid Center of Southern Nevada and $100,000 for Safe Nest.
The finance committee staff said there is roughly $1.3 billion of unallocated relief dollars remaining at the state level.
Contact Colton Lochhead at email@example.com. Follow @ColtonLochhead on Twitter.