By Jason Warner and Alison Goebel

On August 23, Ohio Senate President Matt Huffman (R-Lima) announced the creation of a special Select Committee on Housing. The committee is chaired by Sen. Michelle Reynolds (R-Canal Winchester) who is joined by Sens. Terry Johnson (R-McDermott, Vice Chair) Andrew Brenner (R-Delaware), Louis Blessing, III (R- Colerain Twp.), and Hearcel Craig (D-Columbus, Ranking Member). The committee was created to hold hearings to learn what additional steps the state can take to encourage homeownership while removing barriers that entrepreneurs encounter as they work to revitalize neighborhoods.

To date, the committee has conducted four hearings, all in Columbus. Many of the witnesses who are practitioners or represent membership organizations raised concerns about rising costs of construction, insufficient supply, the lack of affordably-price housing, and issues facing renters. Advocates suggested a variety of solutions to the complex challenges facing Ohio.

On September 26, GOPC provided testimony before the committee. You can read the full testimony submitted on behalf of our Executive Director Alison Goebel on our testimony page, and an abbreviated version of the testimony is below.

To view all of the hearings to date, visit the Ohio Channel Website which has an archive of previous hearings. Future hearings will be held across the state of Ohio, providing Ohio citizens and local activists the opportunity to share their knowledge and views with lawmakers. Check back for updates about when these hearings will take place.

Chair Reynolds, Vice Chair Johnson, Ranking Member Craig, and members of the Senate Select Committee on Housing, thank you for the opportunity to provide testimony.

My name is Alison Goebel, and I am the Executive Director for the Greater Ohio Policy Center (GOPC). We are a statewide non-profit research and policy organization that champions revitalization in Ohio. Much of our work focuses on and occurs in Ohio’s ‘legacy cities,’ which are also sometimes know as rustbelt cities.

Housing is the number one concern for the dozens of communities we work with. Local leaders know that homeownership is a critical component to their long-term success.

Ohio Needs Silver Buckshot

The solutions I am about to discuss assume there is no silver bullet and that we need silver buckshot. This means, we need an all-of-the-above approach to preserving and increasing housing options, especially homeownership options in Ohio.

Housing Happens in Vibrant, Stable Neighborhoods

I want to focus first on recommendations to help stabilize and increase vibrancy in Ohio’s neighborhoods because risky markets do not attract developers. Mitigating blight, and thus helping depressed housing values bounce back will help new homes be developed in Ohio.

Five state policy recommendations we have to help increase vibrancy in Ohio’s neighborhoods are these:

1. The state, through revised code provisions, should require rental property owners to provide actual ownership and management contact information when recording real estate transactions. Senate Bill 76 (SB76) has provisions that do that and we encourage the Legislature to pass a version of SB76 that retains this language.

2. Continue to explore methods to limit purchases by institutional real estate investors that are rapidly converting single family homes into rentals. SB76 is a step in that direction and we will continue to need others, perhaps additional transfer or filing fees on investment purchases.

3. Make it easier to create municipal or county housing courts. Housing courts have a dedicated judge that hears civil and criminal cases related to housing. Ohio’s 3 housing courts were created through the state’s Revised Code. Empowering local jurisdictions to create housing courts without approval by the General Assembly would make it easier for local governments that want to pursue criminal charges against entities responsible for blight and unsafe living conditions.

4. Continue funding blight removal AND property rehabilitation. Land banks have effectively utilized federal and state demolitions funds. As a result, many counties have eliminated the worst of the worst and now face the dilemma of tearing down properties that are salvageable, but expensive. Future blight mitigation funds allow for demolition AND property rehabilitation.

5. Continue to provide grant funding for brownfield remediation. Brownfields are environmentally contaminated sites, such as former auto factories or asbestos-laden schools. These sites are ripe for new development once remediated. For example, Harrison West, a dense residential neighborhood south of the Ohio State University, is built on a former margarine factory that received brownfield remediation funds in the early 2000s.

Homeownership will be Easier to Achieve when Development Costs are Lowered

Switching gears, I now want to talk about the high cost of development and how it makes homeownership difficult in Ohio. Here are 5 recommendation we have to lower costs or reduce development timelines:

1. Create a grant program to help local communities modernize their zoning codes. A grant program could help communities update their zoning codes, which will help reduce the time and paperwork needed to build housing the market wants, such as granny flats in single family neighborhoods.

2. Help communities utilize pre-approved building designs. Pre-approved building designs are architectural designs that a city or county pre-emptively approves for use within their jurisdiction or select zoned areas. GOPC and the Ohio Realtors Association are investigating how pre-approved building designs can cut red tape for infill development projects. Funding to a) help communities zone for pre-approved building designs or b) close development financing gaps on pre-approved architectural designs will help bring more homes to market more quickly.

3. Create the Ohio Community Transformation Fund. This program would provide grants to Community Development Financial Institutions (CDFIs) for lending and technical assistance to real estate projects that cannot access traditional bank loans. This Fund would provide grants to experienced financiers that know how to coach borrowers and leverage other dollars.

4. Establish a loan loss reserve for small-dollar mortgages and home improvement loans. Intermediaries and local housing agencies need a fund to help underwrite small-dollar mortgages and home improvement loans that banks will not or cannot handle.

5. Replicate Minnesota’s Community Land Trusts Homebuyer Initiative Program. This program helps moderate-income homebuyers buy existing homes that are just out of their price range. The program helps moderate income families buy homes just out of the reach. In return, the family puts the land that the house is on into a community trust—so that the family can earn equity on their home purchase, but the house remains affordably priced for future purchasers.

Conclusion

Chair Reynolds, I will stop there with my suggested silver buck shot. I thank you for the opportunity to be here today and am happy to address any questions.