Tagged: Louisville Affordable Housing Trust Fund

Dozens of residents and community activists filled City Hall on Thursday to urge the Louisville Metro Council to boost funding for affordable housing, but an ordinance seeking to pay for the initiative is losing support.

Several people spoke in favor of legislation that seeks to put nearly $10 million into the fund by increasing the city's tax on insurance premiums by one percentage point.

Affordable housing advocates who testified before the council spoke of skyrocketing rent and mortgage costs, the high number of homeless public school children and the need for new units.

"We can’t let school kids continue to be homeless, and let this problem go unsolved. So there are people who are in agreement that we need to do something and figure out how to fund the trust fund, and work together to figure out how to do that," Rachel Hurst, executive director of the Affordable Housing Trust Fund told WFPL.

But the prospects are grim now that a majority on the council have said they do not support the proposal.

Council President Jim King, D-10, and Councilman David Yates, D-24, have both said they will not vote for the ordinance. And after two of the original seven co-sponsors withdrew their support this week, another supporter—Councilman Brent Ackerson, D-26—announced he is also backing off the bill.

A second Democratic Louisville Metro Council member is pulling their sponsorship of a proposal to raise the city’s tax on insurance premiums to give affordable housing initiatives a consistent revenue stream.

Councilwoman Madonna Flood, D-24, was listed as one of original seven lawmakers backing the legislation, which seeks to increase the tax by one percentage point and raise an estimated $9.7 million for the Affordable Housing Trust Fund.

But Flood now opposes the idea and says supporters put her name on the ordinance without her consent.

"No one called to discuss with me an ordinance being filed at that particular time. We talked in generalities," says Flood. "They were gathering support, but I had a ton of questions that I asked folks about that and for some reason my name appeared on the ordinance."

Louisville Metro Councilman Rick Blackwell, D-12, is pulling his support of an ordinance to help pay for the Affordable Housing Trust Fund by raising the city’s tax on insurance premiums.

The proposal was introduced by Democratic lawmakers this week, and seeks to increase the tax by one percentage point to raise an estimated $9.7 million.

Supporters argue going from a 5 to 6 percent rate represents a small increase per month for average residents.

In an e-mail message sent Feb. 11 to Councilwoman Tina Ward-Pugh, D-9—the bill's chief sponsor—the Jefferson County attorney’s office said it is "unconstitutional" to designate public funding exclusively for affordable housing

Any new revenue would have to go through the general fund first, and that is unraveling the bill's support.

"I think it’s problematic if it’s not a dedicated source. That’s what people had signed on for," says Blackwell. "It was supposed to be a way to take care of some of the issues in our neighborhoods with the abandoned and foreclosed on homes. And if it’s not dedicated to that I think you’ll have a hard time keeping sponsors and keeping people on board to vote for it."

Louisville Metro Council President Jim King says it isn’t practical to raise taxes for the Affordable Housing Trust Fund, despite Mayor Greg Fischer’s suggestion.

The council set up the trust fund to give grants and loans for affordable housing activities, such as new construction, home rehabilitation, payment assistance and emergency repair. But the fund has struggled to find an adequate revenue stream since it was first formed in 2008.

After months of saying that residents had no appetite for higher taxes, Fischer told The Courier-Journal his administration supports a one percent increase of the insurance premium tax to pay for the trust fund if council members agreed.

But King says raising taxes of any kind would be a burdensome to residents and small businesses in a tough economy.

"I would have to say that I didn’t expect (Fischer's) comment because I wasn’t aware he was interested in adding anything to that tax. But I don’t think that the council as a whole is in a position to support that right now," he says.