The program will target low- to moderate-income households looking to invest in their first home
By RORY CONLON — city@theaggie.org
On Jan. 21, the Davis City Council approved the framework for a future down payment assistance program targeting first-time homebuyers.
Assistant City Manager Kelly Stachowicz delivered a presentation on the draft ordinance that would provide this framework. She stated that approving the ordinance would mark the beginning of the process, with more program-specific guidelines coming along later.
“What an ordinance would do is put the signal [out] to the public and others that the down payment assistance program is something the council is interested in and has the intent at some point to go forward with,” Stachowicz said. “It may also help to show the city’s commitment to this type of program, as we are seeking different kinds of funding sources.”
The program would target low- to moderate-income households that make no more than 120% of the area’s median income. Program beneficiaries would have to live in the home they purchase, prohibiting them from renting it out as an investment property.
Stachowicz said the down payment assistance amount, yet to be decided, would be paid off when the buyers eventually sell the home.
“At such time the household decides to sell the property, […] that down payment assistance funding is repaid to the city with the proportionate amount of the equity that it’s earned,” Stachowicz said. “That money coming back to the city would be used to fund the next household looking to get into the market.”
Co-chair of Interfaith Housing Justice Davis Vera Sandronsky publicly supported the program. She revealed that a down payment assistance program had been in the works for years.
“Volunteers from the community developed a draft down payment assistance program and met with city staff back in [the] fall of 2021,” Sandronsky said. “With Measure Q’s passage, there is [a] new urgency for the city to move forward and to make a downpayment assistance program a reality in Davis. I encourage you to allocate one million yearly to this program.”
Davis resident Elaine Roberts Musser listed nine criticisms of a down payment assistance program, ranging from a risk of foreclosure, which would lead to loss of the city’s investment, to the duplication of the same type of program at state and federal levels. Musser said the city needs to do more research before moving forward.
“The city has dipped [its] toe into providing affordable housing assistance before, namely [Davis Area Cooperative Housing Association]( DACHA), and it was an unmitigated disaster,” Musser said. “I would know, because I represented the homeowners in that case. It’s a shameful part of the city’s history. Let’s not have a repeat performance.”
Former City Council Member Dan Carson urged the city council to reject the proposal and send it back to the Fiscal and Social Services commissions for review before adopting it. Carson said there are several problems with the proposal.
“There’s no estimate here about what it would cost to give these grants out and spend literal decades overseeing the operation of this program,” Carson said. “We don’t know why you should be allowing city funds to be used for people who don’t live in the city of Davis. Not a unit of housing would be generated by this program to satisfy the city’s very significant obligations to meet state requirements to increase the amount of affordable housing.”
Council members amended the ordinance to legally require funds to be used toward the purchase of a home in Davis. In their comments, council members also agreed that the program guidelines should be reviewed by the Fiscal and Social Services Commissions.
City Manager Michael Webb referenced a Dec. 17 meeting where the council formed two subcommittees, one specific to pavement management and investment and another that would look into other funding needs and priorities on a city-wide level. He gave a rough timeline for when commissions could develop a budget for the down payment assistance program.
“The work of the subcommittee on fiscal [priorities] would continue over the course of the next couple months, culminating in March or April [with] budget priority recommendations coming back to the council and the staff for those new net revenues [from Measure Q],” Webb said. “At that time, it’ll become more evident to what extent there may be a component of that funding that the council wants to set aside for affordable housing, and then of that, if there’s a sub-component for a down payment assistance program.”
The city council approved the ordinance and also directed city staff to start developing specific guidelines for a down payment assistance program in tandem with the Fiscal subcommittee working on a report for the overall city budget.
Written By: Rory Conlon — city@theaggie.org
