Crime, New Orleans' crumbling infrastructure and poverty always top Mayor Mitch Landrieu's list of shortcomings in his annual State of the City address. His 2016 address, delivered last week on the roof of the Whole Foods Market in Mid-City, was no different. But amid contentious debates over the future of short-term rental companies like Airbnb and the increasing creep of property developers, gentrification, rising rents and deplorable housing conditions — all wrapped in stagnant wages and dwindling jobs — Landrieu released a five-year plan for more affordable housing.
According to the plan, the city will "build or preserve" 7,500 affordable housing units by 2021 — with 4,000 units available by 2018, followed by an additional 3,500 units in the ensuing three years.
"People are flocking here, but rising demand and job growth means that housing costs have risen by 50 percent since 2000," Landrieu said in a statement. "Now, due to a broader loss of income-affordable rental units along with low-wage jobs and inadequate public transit, many New Orleanians pay more than 50 percent of their income just on housing costs. That is unacceptable and unsustainable. ... We must ensure that working people do not get priced out of New Orleans — they are the backbone of our City."
More than 55 percent of New Orleanians live in rental housing, according to a recent report from the New Orleans Redevelopment Authority and the Center for Community Progress. That's nearly 20 percentage points higher than the national average (36 percent) and an all-time high for nearly 50 years. In its recent "State of the Nation's Housing" report, Harvard's Joint Center for Housing Studies found that thousands of households in the New Orleans area are cost-burdened, spending 30 percent or more of their income on housing. In New Orleans, 80 percent of people earning less than $15,000 a year spend more than half their income on rent.
The Landrieu administration characterized the city's current housing crisis as having "fewer public resources due to federal and state budget cuts, coupled with loss of 'income-affordable' units, low-wage jobs, and inadequate transportation options" along with a rental market driven by "those who returned to New Orleans following Hurricane Katrina, families who lost wealth during the 2008 Recession, and demographic groups like Millennials" who have deferred "homeownership due in part to higher home values."
According to Landrieu's plan, the city will increase affordable housing by focusing on city-owned property and other public land, reserving tax-adjudicated properties in "target neighborhoods," and by increasing its use of "priority bids" at sheriff's auctions and public sales.
The city plans to increase the availability of "workforce housing" for two income levels: "service workers, artists, and culture bearers, who may require a deeper housing subsidy," and "teachers, educators, and public safety officers, who may not be served through existing city programs." The city will work with the Finance Authority of New Orleans to help homebuyers with down payments and closing costs, and with local employers on incentives for employees to live closer to their jobs. It also will work with the Regional Transit Authority to provide more public transit options in underserved neighborhoods.
The administration pledged to push for changes to the Comprehensive Zoning Ordinance to demand more affordable units in market-rate developments. The city also wants to ensure "long-term affordability" in units receiving federal subsidies. The city says 1,200 subsidies expire by 2021, and nearly 4,900 expire by 2031.
As for the conditions of private rentals, the city will push for a rental registry program, which housing advocates have urged the City Council to put in place, but those plans were dropped last year. According to the Greater New Orleans Fair Housing Action Coalition, of the more than 62,000 rental properties in the city, nearly 50,000 have needed some kind of major repair. In 2015, the city inspected 15,000 properties for code violation complaints.
But that private market also is getting smaller. Airbnb alone lists more than 4,000 short-term rentals in New Orleans, and more than 70 percent of those listings are entire homes.
Landrieu has pushed the New Orleans City Planning Commission to keep whole-home short-term rentals on the table as it plans for legalizing short-term rentals such as those listed on Airbnb. While the City Planning staff has kept the door open for those types of rentals in its reports to the commission, the commission has rejected them — and so have many residents, businesses, hospitality industry workers and members of the City Council.
"New Orleans lacks a comprehensive policy to regulate and limit the use of short-term rentals," the report says. "The City can ensure its policies balance the evolving nature of the sharing economy within New Orleans with the City's goals to preserve affordable rental housing and prevent displacement. Regulating short-term rentals through thoughtful, clear policy would accomplish both."
Plans for this already are in progress. The City Planning Commission is expected to vote on short-term rental changes in August, and the City Council then will decide whether to adopt suggested changes in the law. "Under this approach," the report reads, "all short-term rental operators would need a license to operate a rental property, with the fewest restrictions on owner-occupied properties and those in commercial districts."
The plan also will expand housing efforts for people experiencing homelessness and vulnerable populations, like people living with HIV/AIDS. The city has claimed it is the first in the U.S. to effectively eliminate homelessness among veterans, using a "housing-first" model praised by first lady Michelle Obama. The city expects to do the same for families by 2018.
Landrieu's term as mayor ends in 2018, leaving the rest of the plan up to his successor.