City directors discuss need for more affordable housing in Fort Smith; look at options

NWA Democrat-Gazette/DAVID GOTTSCHALK  Fort Smith City Building City Hall Fort Smith downtown offices.
NWA Democrat-Gazette/DAVID GOTTSCHALK Fort Smith City Building City Hall Fort Smith downtown offices.

FORT SMITH -- City directors are seeking ways to add affordable housing and renting opportunities in Fort Smith.

Candyce Gabucci, the city's director of community development, gave the directors a presentation about current affordable housing options during their meeting Tuesday and explained how it pertains to community development block grants and the Home Investment Partnership Program that Fort Smith participates in.

The U.S. Department of Housing and Development defines affordable housing as housing for which the occupant is paying no more than 30% of gross income, including utilities.

When collecting public input for her department's 2021-25 consolidated plan, the top five priorities requested all related to affordable housing, Gabucci said.

"We have housing assistance. That includes down payment and closing cost assistance," Gabucci said. "Housing rehab, which supports programs that assist homeowners with repairs, housing development and reconstruction, and then emergency assistance such as utility and rental assistance, and lastly emergency home repairs. So currently, four out of five of these programs are offered under our community development block grant as well as the Home Investment Partnership Program."

Gabucci said community members can use the block grant money for acquisition of property, demolition, renovation of single-family, owner-occupied homes and new construction of single-family homes.

She said the block grant is mainly used for housing assistance, which serves eligible low-income residents in Fort Smith by helping pay for code or health and safety projects in their homes such as heating and air, electrical, plumbing issues or building wheelchair ramps.

Gabucci's department has an application process and accepts projects based on eligibility and amount of funds. She said there is a little over $250,000 in national Housing and Urban Development money allocated for these projects.

"Under the umbrella of affordable housing, the city of Fort Smith receives the Home Investment Partnership Program funding," Gabucci said. "This program addresses affordable housing through home funds. The department receives a yearly formula based allocation from HUD, so it is all federally funded. For the 2023-2024 program year, the city of Fort Smith received $462,538 in home funds, $416,285 of those funds are allocated for affordable housing."

Gabucci said a portion of the money was given to the Crawford Sebastian Community Development Council to construct single-family housing. She said the council is Fort Smith's only Community Home Development Organization, which is a private, nonprofit, community-based organization developing affordable housing.

Caleb Brown, director of home ownership for the Crawford Sebastian Community Development Council, said the council offers home ownership programs for people in Crawford, Sebastian and Franklin counties.

"We have our city of Fort Smith new construction program, down payment assistance, our home buyer education program, housing counseling and the mutual self help housing program," Brown said. "We also have two rental development projects, Stone Brook of Van Buren and Stone Ridge of Fort Smith. Within the city of Fort Smith, we focus on these programs, starting with housing, counseling and home buyer education."

Brown said the council also gets money from Arkansas Development and Finance Authority loans, which are partially forgivable and allows them to keep housing and rent costs low. He said since fiscal 2022 ended the council has completed four houses and expects to close on another by the end of the month.

"For these houses, we've got $147,510 average home investment, so that's coming out of the grant funds and previous program income. Our average subsidy, which Candyce mentioned has been increased to $40,000, was $26,714. The amount of money that goes back into the program after CSCDC resumes our fee and we pay the city their administrative fee $93,665, so 63% of the national investment is returned to the program," Brown said.

Ward 3 Director Lavon Morton said these are the types of things Fort Smith needs. He said he thinks the board would agree they want to do what they can to help facilitate this program and make it bigger so it can be used by more people.

Ward 2 Director Andre Good asked if another Community Home Development Organization was created in the area, would that be additional money or would the money be split with the Crawford Sebastian council.

It's tough to say, and it depends on what the federal government wants to fund, Gabucci said. In the past the Fort Smith Housing Authority was considered a development organization and ended up competing for that money for construction, she said.

"So I think the housing authority decided that rather than both agencies competing for all the funding, they would work as partners and CSCDC would apply for the funding, and then the housing authority helps to construct those new homes," she said.

Good asked if the city could create a program where they buy or receive blighted properties from homeowners and sell it to the council to help increase the number of affordable houses built.

"We can work that out and provide the basis for the land," City Administrator Carl Geffken said. "Or even if it's a home, we have the option when filing liens to take ownership of that home. The city used to do that and wound up with a bank of homes because it didn't have a program in place, but that could be something that CSCDC, besides building new homes, can renovate older homes."

The city should be careful when it comes to taking over property, At-large Director Neal Martin said.

"I think that can get us into some situations," Martin said. "But we've got to be able to incentivize removal of blighted properties. Whether that's through the developer, whether that's through the owner, whatever, we've got to figure out a way to do that."

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