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The focus of this issue of
My View is on Community Land Trusts (CLTs) because there are
now 10 CLTs in the state of Washington, in cities, towns and rural
communities. Not surprisingly, all of our CLTs are based in areas
that have seen stupendous growth, both in terms of population and in
the skyrocketing of median home prices.
       
What are community land trusts? One frequent
misconception is that they’re involved with preserving land from
development. In fact, CLTs are affordable housing-focused
organizations. They’re set up to help homebuyers secure affordable
homes and achieve an equity return on their investment, while
preserving affordability for the next homebuyer. That’s one reason
the CLT model is so compelling: it offers an affordable home now
and preserves that affordability for future buyers.
CLTs accomplish this by keeping the land on which these homes sit in
permanent stewardship. The appreciation of the land is taken out of
the price equation. And, when homeowners are ready to sell, the
price is determined by the CLT according to a formula that allows
the next buyer to also pay a below-market price. (please
see "By the book")
I was originally skeptical about the CLT model’s ability to produce
housing on a large scale. But my appreciation of CLTs as a practical
model for meeting high-capacity needs for affordable housing was
kindled during a tour of the Burlington Community Land Trust
(BCLT) in Burlington, Vermont about ten years ago.
Answering Broad Housing Needs
In Burlington, Vermont
Founded in 1984, BCLT is currently the largest CLT in the U.S. and a
looked-to pioneer, with 2,500 members, more than 370 single-family
shared-appreciation homes and condos, 125 coop apartments, and 380
rental apartments on land trust property. BCLT, with help from the
municipality of Burlington, the Vermont Housing and Conservation
Board, and many other partners, has purchased and rehabilitated
houses and apartments, built new homes, created transitional
housing, secured condo affordability covenants and much more. BCLT
has had extraordinary success in housing a large number of people in
a city of about 40,000 and a metropolitan area of approximately
200,000.
For Washington, It Started
in the San Juans
“Ours is a values-based system that recognizes land as a shared
resource, which we want to steward in a way that meets community
needs.” Lisa Byers, Executive Director, OPAL
The Community Land Trusts on Orcas and Lopez islands are the
“grandmothers” of Washington State CLTs, and have served as an
inspiration and sounding board for those that have been founded
since. Interestingly, the impetus for bringing community land trusts
to Washington State can be traced to a single individual, Peter
Fisher.
In the late 1980s, Peter noticed that many of his friends were being
forced to leave Orcas Island because they couldn’t afford to live
there. Concerned, he began searching for models in other parts of
the country, discovered the CLT concept and started to spread the
word among like-minded people in the San Juans.
Orcas Island Property:
OPAL executive director Lisa Byers,
Bonnie Brae neighborhood of Eastsound."
In 1989,
OPAL (Of People and Land) formed on Orcas and the
Lopez Community Land Trust (LCLT) came together on Lopez
Island. What’s notable about these two organizations is how
their housing projects reflect their distinct philosophies.
OPAL’s Executive Director Lisa Byers explains, “Ours is a
values-based system that recognizes land as a shared resource, which
we want to steward in a way that meets community needs.”
Correspondingly, on Orcas, the first project was a cluster of
single-family houses built around a communal village green. Opal
Commons was completed in 1994.
While Orcas is a tourist destination with a strong arts community,
Lopez’s economy is based in “farming, fishing and forestry,” says
Sandy Bishop, executive director of LCLT. Sandy believes that
basic difference is reflected in the Lopez group’s philosophy and
projects. Lopez emphasizes housing cooperatives, compared to the
single-family ownership model on Orcas.
Sandy Bishop, Lopez Community Land Trust, Executive Director
Lopez projects rely on a large percentage of sweat equity, whereas
Orcas was able to tap into USDA’s rural housing assistance programs
to make the homes affordable. Last but not least, LCLT also focuses
significant resources on agricultural issues: projects include the
Lopez Community Farm and the first USDA-approved mobile meat
processing unit.
 The San Juan experience shows the flexibility of the CLT model. It
is adaptable to communities with different needs. But the question
that really interests me, from a statewide affordable housing
perspective, is: “Can the model work in a large town or urban
context to provide a significant number of housing units?”
The Innisfree Property: Completed 2 years ago, the crew is made
up of volunteers, residents building their own homes, some lead
carpenters and Americorps.
Kulshan CLT Ramps Up Growth
Incorporated in 1999, the
Kulshan Community Land Trust (KCLT), based in Bellingham,
has shown how much can be accomplished in a relatively short space
of time when communities and elected officials work together for a
common cause. Executive Director Paul Schissler, who was one
of three co-founders of KCLT, says that his organization’s successes
in Whatcom County come from having “almost all of the right
ingredients. People here care,” he asserts, “and local elected
officials are looking to find a way to address a worsening problem.
We can’t change the global trends that are affecting wage rates, but
as a community we can affect the cost of housing so that people can
afford to live here.” Another key ingredient: a willingness to try
different approaches to securing homes to increase capacity.
“The challenge is having supply respond to demand—how can we scale
up this approach? As a state and as a community we can set ambitious
goals.” Paul Schissler, Executive Director, Kulshan
Community Land Trust
For Paul, the growing recognition that Whatcom County is a wonderful
place to live has created “a painful irony. We started with a great
setting,” he says, “and people who live in this community have
contributed to make it even more appealing.” In the 4th quarter of
2005, the median price for a home in Whatcom County was $289,900—up
25.7% from same quarter of 2004. By contrast, Paul emphasizes, half
the households in Bellingham are earning incomes less than the
$50,000-a-year median.
It took about two years for KCLT to enlist members and secure
funding to get rolling as an organization. They opened a small
office in 2001 and settled on an initial two-pronged program of
homebuyer education and scattered-site home acquisition. With a
scattered site approach, a qualified homebuyer can buy a home on the
open market; the home must meet certain criteria, including price,
and the property goes into stewardship. In 2002, KCLT acquired its
first seven houses. They’re now up to 45 scattered site homes, and
10 condos with affordability covenants. In the CLT framework, condo
affordability covenants basically work the same as a ground lease
under a house.
The City of Bellingham has been a strong partner with KCLT. Right
now, KCLT is in the development stage of building its first new
homes in Bellingham—14 of them on less than one acre. This is an
innovative pilot demonstration project encouraged by the City to
take advantage of increased density to house more families and
increase affordability. This Enterprise development will have eight
units with a zero lot line, five single-family detached homes, and
one “carriage house” above a shared community space.
The challenge, says Paul, “is having supply respond to demand—how
can we scale up this approach? As a state and as a community we can
set ambitious goals.” He points to the comprehensive plans for both
Whatcom County and Bellingham; both have adopted the goal that every
neighborhood and every community will have a healthy mix of housing
types in terms of ownership, size, and price. “That goal is without
a definite number,” he says, “but KCLT’s strategy is to increase its
affordable housing stock this year and every year.”
Preserving Community and Culture
Leavenworth’s SHARE CLT is a part of a larger organization in
Leavenworth, Upper Valley MEND (Meeting Each
Need with Dignity). SHARE, like so many CLTs, grew out
of a growing sense of urgency over the availability of affordable
housing. In the case of SHARE, one of those willing to do something
about it was
Executive Director Carl Florea.
Carl Florea, Executive Director, SHARE CLT
Carl moved to Leavenworth 21 years ago to serve as pastor of a local
Lutheran church. He increasingly saw homes that “could have been
starter first homes” taken off the market. “That was disturbing to
me,” he says. “I didn’t want to lose a sense of diversity in our
community.” Carl and a friend continued to attend city planning
meetings to raise housing issues. “We kept saying, ‘we should be
doing this as a community.’”
In 1997, Carl attended a conference where Lisa Byers was doing a
presentation on CLTs: “A light went on: I said, ‘that’s it.’”
SHARE was founded the following year, and this organization has just
completed its second 10-home neighborhood development in
Leavenworth, in addition to two rental units, which serve as homes
for families on the wait list for the homebuyer program. Carl is
gratified at the level of support that SHARE has received from the
local community.
SHARE CLT Executive Director Carl Florea
and Aldea Village resident
Ana Rosario
In a very real sense, Carl explains, Leavenworth is “cursed by our
beauty.” Beauty can be a blessing in that it draws outside money,
especially in a tourism economy like Leavenworth’s. The downside of
this is that tourism economies don’t offer a high wage base, and
communities like Leavenworth are seeing more and more homes go to
retirees from wealthier economies or to second homes.
For Carl, SHARE’s work in securing affordable homes is “all about
community preservation. If you don’t preserve affordability in
housing, then people who work here will have to live elsewhere. For
me, that doesn’t define what community is.” Affordable
homeownership is an important part of the broad needs of a thriving
community, Carl stresses. He points out that Leavenworth could also
benefit from more affordable rental homes for families as well—and
that SHARE would definitely look to partner in that effort. “We
believe in what we’re doing,” he says.
Sam Hendricks, Executive Director, Vashon Household
Sam Hendricks, executive director of Vashon Household,
has a similar point of view, even though Vashon Island is not
a tourist economy. “Our organization,” Sam says, “is looking at a
housing market that can only be described as out of control. It is
changing the character of our island. The regular folks are being
driven off: working families, retail workers, craftspeople,
teachers, healthcare workers, tradespeople. They can’t afford to
purchase a home here with little or no equity. $430,000 is now the
price of a median home—$300,000 for any kind of house that is
habitable.
“What we’re really doing with this CLT is staking a claim,” Sam
stresses. “We’re not just giving a few families a leg up: If the
housing market doesn’t work, we’re going to create our own market
mechanism, to create affordable housing and keep it affordable for
our kids and our grandkids. We are fighting to preserve the
fundamental culture of our island.”
Vashon Household got its start in 1991 and is currently Vashon
Island’s biggest developer. Most of the island is zoned for one
house per five acres, so the organization has been confined in large
part to developing new homes near the town center, where the zoning
is less restrictive. Since Vashon Household’s founding, says Sam,
they’ve completed three projects and have three in development, all
within this multi-family zone. This includes a nine-unit home for
residents with disabilities; 21 subsidized apartments for low-income
seniors; and five homes in a co-housing community. The three
developments in progress are 26 town-home rental units for
low-income families; Sunflower CLT, a 14-home King County-designated
green design project; and Roseballen, which will house 19 families.
Roseballen is Vashon Household’s most ambitious project to date. The
homes themselves are being created barn-raising style by the
families themselves; the sweat-equity component of the project is
made possible through a partnership with Northwest Housing
Development. The development is on 20 acres, with 11 preserved as
open space with environmental covenants. Four-and-a-half acres are
leased out long term to local low-income organic farmers, which
gives that land a 90% agricultural land tax break. The environmental
set-aside acreage gets a 70% tax break.
Vashon Household Executive Director Sam Handricks shows some of
the first resale-restricted homes built on Vashon Island by his
organization; these homes' resale prices are restricted by covenant.
“We have to act absolutely as aggressively as we can. We’re acting
now to nail down the last remaining developable Vashon properties,”
says Sam. When the current three developments are completed, “118
families will be living in Vashon Household homes. That’s a lot, but
it’s not enough.” Currently, Vashon Household is negotiating on
another property and looking at other options for preserving
affordability, including group homes.
Partnerships Make a Difference
In a large urban area like Seattle, the very qualities that have
helped CLTs in rural communities and small towns—a close-knit
populace, for example, that recognizes the value of diversity and
affordability and will come together to preserve that—can work
against them. It can be that much harder to get the momentum needed
to achieve success on a large scale in a city.
“We have to build up capacity to do larger-scale projects. Our
challenge is can we grow quickly enough.” Sheldon Cooper,
Executive Director, Homestead CLT
Homestead CLT (HCLT) is currently Seattle’s only CLT.
Incorporated in 1992, the organization has had some tough breaks,
and nearly went under early on when funds couldn’t be assembled
quickly enough to get an initial project off the ground. Since
Sheldon Cooper took on the role of executive director in
1999, however, HCLT has been turning itself around, building
partnerships and gaining momentum. The organization is strongly
focused on homebuyer education to ensure that buyers understand the
CLT model as well as their financial requirements. And HCLT is
utilizing a buyer-driven scattered-site approach to add as many
homes as it can to its stewardship.
HCLT started its scattered-site program in earnest last year, adding
seven homes; two more are in the closing process. Unfortunately,
says Sheldon, “it’s a race against the market. There’s a lot of
competition for these homes.” Typically, HCLT’s homebuyers can just
barely break into the Seattle market; the homes with sticker prices
they can afford, even with up to $80,000 in purchase assistance from
HCLT’s Advantage program, frequently get lost in bidding
wars. But HCLT and its homebuyers are persevering.
And late last year, HCLT began a dialogue with Habit for Humanity
and the City of Seattle on a partnership to create seven new homes.
“This is a very exciting piece for us,” Sheldon says. The City of
Seattle has several vacant parcels, which it will convey toward the
goal of permanently affordable homeownership. Habitat will select
the families and provide mortgages; Homestead will be the steward of
the land.
Sheldon acknowledges that the funding environment for HCLT “is not
easy. Like all nonprofits, we have to knit together all the numerous
sources.” The City of Seattle has offered additional support to
HCLT’s efforts with funding out of its housing levy. Plus HCLT is
receiving federal dollars. But on the operating side, there’s the
typical nonprofit’s lament: “We’re a small organization with a small
staff. It’s a boot-strap approach,” Sheldon emphasizes. “We have to
build up capacity to do larger-scale projects. Our challenge is can
we grow quickly enough.”
The Northwest
CLT Coalition: Thinking Strategically
One way in which CLTs in our region are tackling the challenge of
how to grow enough to meet the needs of their communities: they’re
pooling resources and sharing their expertise. The members of the
Northwest Community Land Trust Coalition
encompass the 10 Washington State CLTs, plus two CLTs in Oregon
and one in British Columbia. Since 2000, they’ve met twice a year
for two-day stints to compare notes and mentor one another. Members
discuss tactics for building public awareness, expanding and
developing funding sources, and building more stable, sustainable
organizations.
More recently, the Coalition has organized itself formally as a
501(c)3, and is increasingly thinking about long-term tactics. The
group hired consultant Melora Hiller to help them create a
strategic plan and devise a fund-raising strategy. “Right now, one
of the challenges for the Coalition,” Melora says, “is to think
strategically about where CLTs can and should grow. Can existing
CLTs expand to broader geographic areas?” Members’ overarching
questions are: “How can we develop dedicated funds to support our
CLT members—and how can we produce more affordable housing?”
Melora Hiller, consultant
Melora and the Coalition are exploring whether, for example,
providing centralized back office services would create efficiencies
for members. She points out that a revolving loan fund to serve
members’ affordable housing efforts is on the organization’s wish
list, though they’re still exploring how that would be funded and
who would manage it. What is clear is that the Coalition has
provided tremendous support to its members. Every CLT director I
spoke with affirmed its clear value to his or her organization, from
technical assistance to morale building to creative brainstorming.
Currently, the Commission is working with Melora and the Coalition
in providing legal research on how CLTs can get fair tax appraisals
and assessments to help keep down operating costs. Coalition members
are advising groups in Chelan and Port Angeles that are looking to
create CLTs in those communities. And the Coalition-founded CLT
Academy inaugurated its first CLT training seminar earlier this
month in Seabeck, Washington: a three-day intermediate-level
workshop on how to apply the CLT model. The conference, underwritten
by the Lincoln Institute of Land Policy, was sold out.
A New National
Trend: Blockbuster CLTs Poised to Grow
John Emmeus Davis, who visited Washington State this month as
a trainer for the Coalition’s CLT Academy, is a co-founder and
partner in the consulting cooperative Burlington Associates in
Community Development and a former housing director and
Enterprise Community coordinator for the City of Burlington,
Vermont. He’s also one of the nation’s leading experts on CLTs.
John Emmeus Davis, Burlington Associates in Community Development
Not only does John have a broad historical perspective on how CLTs
have developed in this country; as an advisor on many ambitious
fledgling CLT projects, he’s got a great vantage point on what we
can expect to see from CLTs in the coming years.
“Since the millennium, several dozen CLTs have been launched,” John
says. “The rate of formation has been quite high.” Interestingly, of
these new organizations, four are projected to be huge in terms of
the number of affordable homes they will make available. “Burlington
CLT is the largest CLT in the country,” he affirms, “but these new
CLTs could go past us quite rapidly.” Here’s some of what John is
seeing:
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The City of Chicago has just formed
a citywide CLT. It will serve as an affordability steward for
both owner-occupied housing on leased trust land and
owner-occupied housing on which the City will place long-term
affordability deed covenants. This CLT will be the affordability
“bank” for both.
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Sarasota County in Florida
is targeting the development of 3,000 units of owner-occupied
housing on CLT-held land in the next five years.
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In Delaware, Diamond State CLT,
created through an alliance between the Delaware State Housing
Authority and the Delaware Housing Coalition, an advocacy group,
has launched a strategic planning process similar to Chicago’s.
This represents the first
statewide CLT. Diamond State CLT will act as a steward of
affordability for units that are on leased land, as well as
units created through inclusionary zoning, or financed through
the state housing authority with a deed covenant placed on the
units.
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The City of Irvine, California just
last month made public its goal of 9,700 units of affordable
housing by 2025 representing approximately10% of the city's
housing stock, which will be encumbered with long-term
affordability covenants. This will be accomplished largely
through the creation of the Irvine Community Land Trust.
Critical Mass
Is Important
“Critical mass is important,” says John. “My partners and I are
working with a number of CLTs on analyzing sustainability: what are
the costs of stewardship versus revenues, and where is the
break-even point.” What they’ve found is that the number depends on
the market, the turnover of units, and the resale formula used by
the CLT. “But no matter which way we’ve done these,” he says, “that
number usually comes out to between 200 and 300 units. Under that
number, you’re probably not able to collect enough fees to meet your
own costs as stewards. Only a handful of CLTs in the U.S. have grown
to the point where at least the stewardship part of their function
is self-sustaining.”
However, as John Davis points out, “CLTs are part of a family of
models or mechanisms that are designed to perpetuate the
affordability of owner-occupied housing.” He points to limited
equity coops, limited equity condos and deed-restricted
owner-occupied housing as well. “If you add the CLT to that family
of models of resale restricted owner-occupied housing, it’s a pretty
substantial portfolio: quite a large number of units.”
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For more information on CLTs, a good place to start is an overview
and analysis of the Burlington Community Land Trust’s home resales,
written by John Emmeus Davis and Amy Demetrowitz: “Permanently
Affordable Homeownership: Does the Community Land Trust Deliver on
Its Promises?” This performance evaluation can be downloaded from
Burlington Associates’ website:
www.burlingtonassociates.com.
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By
the book: A look at Kulshan Community Land Trust's first home resale