Delaware introduces housing package to reduce expenses and promote affordable housing growth

State lawmakers in Delaware have proposed policy solutions to address the ongoing housing crisis affecting residents across the country. These solutions focus on reducing development costs and encouraging the construction of affordable housing units.

Sen. Russ Huxtable, a Democrat from Lewes, is spearheading a comprehensive seven-bill package called “The Housing Agenda.” Last fall, he conducted a listening tour to address the housing issues in Delaware.

During his visit to Wilmington, Georgetown, and other areas, the senator actively engaged with state officials, housing developers, community advocates, and the general public to gain valuable insights into the pressing issue of the crisis and to explore potential solutions.

“Housing plays a vital role in the lives of individuals, families, communities, businesses, and the overall economy. The current situation in Delaware and across the nation is a crisis that affects all these aspects,” stated Sen. Huxtable during a press conference held on Thursday.

According to data from the National Low Income Housing Coalition, the state is currently facing a shortage of approximately 21,000 affordable housing units. This shortage is part of a larger nationwide deficit of around 6 million affordable housing units.

According to the 2023 Housing Needs Assessment, Delaware is expected to require 24,400 new units by 2030, equating to an annual demand of 2,400 units. This projection reflects the growing need for housing in the state.

To meet these needs, the package incorporates Senate Bill 22, which promotes the development of new housing units by introducing the Delaware Workforce Housing Program. Taking inspiration from the state’s successful Downtown Development District initiative, this program offers qualified investors the opportunity to receive a grant reimbursement of up to 20% of their capital costs.

According to Senator Huxtable, this proposal takes into account the specific housing requirements of all three counties in Delaware, as well as their individual municipalities. What sets this policy apart is that it goes beyond the geographical boundaries established by the Downtown Development District program, allowing for a more comprehensive approach that aims to strike a harmonious balance throughout the state.

According to the expert, a crucial step in addressing the affordable housing crisis is the establishment of sustainable and stable programs. These programs should be designed to attract individuals and organizations that have the capacity to develop affordable housing. By signaling a reduction in costs and potential subsidy sources, the housing sector can effectively draw in those who are dedicated to creating affordable housing options.

The Housing Agenda also includes Senate Bill 25, which aims to reduce project costs by excluding the 2% realty transfer tax on contracts for the development of affordable housing units.

The legislation also enables New Castle and Sussex counties to use the funds collected from lodging taxes for programs dedicated to workforce and affordable housing within their respective counties.

Sen. Huxtable has introduced a policy that aims to make the state’s Residential Foreclosure Mediation Program and Office of Foreclosure Prevention and Financial Education permanent. These programs were initially established during the 2008 fiscal crisis. By making them permanent, the Lewes Democrat believes that thousands of Delawareans at risk of foreclosure can be assisted in preserving their homeownership.

To complement the range of possible housing solutions, there are proposed bills aimed at addressing various issues. One such bill looks to establish a Housing Repair and Modification Fund, providing aid to low-income homeowners in need of assistance with home repairs. Additionally, there is a bill seeking to prevent landlords in manufactured housing communities from imposing rent hikes when health and safety violations are present. Furthermore, there is a proposal to increase the housing supply in high-density areas by mandating counties and jurisdictions to develop ordinances allowing for the construction of at least one accessory dwelling unit per single-family home.

According to Sen. Huxtable, the current package to address the housing crisis is a dynamic one. However, more efforts are required to fully tackle the issue. The crisis not only affects individuals in need of a suitable and affordable home, but also the communities that require a balanced housing approach. By achieving this, we can ensure a stable workforce that is sustainable for future generations.

The senator emphasized the interconnectedness of the seven bills and recognized them as a significant initial measure. However, they also acknowledged the need for additional efforts to effectively tackle Delaware’s housing crisis.

The Housing Agenda’s components have received support from both chambers of the General Assembly, gaining bipartisan backing. After their introduction on Thursday, each bill was referred to the Senate Housing and Land Use Committee for further examination.

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MBS Staff
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