Public private partnerships (PPP) for developing and managing affordable housing have demonstrated a powerful allegiance to profit before public good in several western countries. Indeed, everywhere you look these days, private developers are the tail wagging the affordable housing dog.
Subsidies or tax credits such as the Low Income Housing Tax Credit (LIHTC) in the U.S. are offered to entice private developers to build housing and offer it at below market rates for decades at a time.
Eventually the tax credits expire. Private partners by and large have:
- come to the government with their hand out to maintain the housing as affordable, or
- offered the housing at market rate, depleting the stock of affordable housing and driving out tenants who can’t afford the higher rents.
The current federal government, despite a US history of massive housing initiatives in earlier times, is committed to small government and the notion that ‘private enterprise can do it better and cheaper.’ This in spite of clear evidence that public private partnerships are completely unable to make a dent in the need for affordable housing, particularly when it comes to housing for the working poor and people who are homeless.
So what about a third alternative — non-profits?
Thanks to their commitment to tenants rather than profit, non-profits are neither inclined to withdraw their services, nor abandon tenants by putting the housing they manage on to the free market.
It might seem unusual that a country would choose to fight a war of any kind, let alone a war on unaffordability, by relying on the good will and commitment of pop-up gangs of idealists. Nevertheless, the potential for non-profits to make a difference in the development and management of affordable housing is certainly worthy of consideration.
Just such consideration is offered by an article in the Washington Monthly: The Case For Nonprofit Housing Developers
A more city-specific article in The Tyee addresses non-profit possibilities in the Canadian city of Toronto: How Non-Profit Housing Developers Could Ease Toronto’s Affordability Crisis
