CITY OF PEORIA, IL
Affordable Housing Plan

The firm was engaged by the City of Peoria to prepare an affordable housing plan to be incorporated into the City’s consolidated plan to guide future spending of entitlement funds. The overall goals of the plan are to optimize the investment of entitlement funds, leverage private and non-entitlement funds, provide a housing product mix to meet the needs of the community, create productive partnerships, and preserve existing neighborhoods.

We assessed demand based on the changing age and income of the households in the City. We then evaluated supply of rental and owner housing in terms of the standard of 30 percent of income for housing costs, and an income threshold below which households cannot afford home ownership. Taking into account subsidized units and vouchers, this analysis showed that there is a gap in the market for affordable rental housing units, and a surplus of affordable for-sale housing units.

We also reviewed the quality of the housing stock neighborhood competitiveness. We found that energy efficiency, lead-based paint, and antiquated electrical, heating, and water facilities were the primary housing quality problems.  In terms of neighborhood competitiveness, we found that the City has a strong park program, but the target area lags behind other areas in terms of crime, school quality, and infrastructure conditions. 

We then reviewed the City’s current spending of entitlement dollars, current housing programs, and leverage. We found that the City’s current housing programs were focused on owner-occupied housing while the need appears to be in affordable rental housing. We also noted that most programs were structured as grants or forgivable loans, with little or no leverage of non-City investment.

We recommended three areas of focus:

• Neighborhood Stabilization: Encourage the creation and expansion of neighborhood organizations and CHDO’s; work to establish employer assisted housing programs; support home ownership programs; implement a “value insurance” program in certain areas; coordinate infrastructure investment; and coordinate public services.

• Total Quality Management of Existing Housing: Comprehensively review codes and enforcement procedures, and consider adding an energy code, rehabilitation code, and appearance code; systematize code enforcement procedures; provide financing for retroactive code provisions; establish a housing advocacy program; establish a landlord-tenant ordinance; expand home maintenance courses and fairs; and support neighborhood clean-up efforts.

• Leverage Resources for Affordable Housing Development and Investment: Change the City’s role from being the primary funder of affordable housing to being the funder of last resort through the creation of partnerships--with banks, financial institutions, developers, foundations, area businesses/employers, and nonprofit housing/neighborhood groups. Initiatives suggested included:

• Lender-based Rehabilitation Financing Program for Both Landlords and Homeowners

• In-fill For-sale Housing and Acquisition Rehabilitation Program Based on Neighborhood Market Value

• New Rental Housing Development, Including Providing Financial Incentives to Market Rate Developers to Include Affordable Housing Units Within Market-Rate Projects

• Additional CHDOs and Other Nonprofit Housing Organizations

• Shallow Rental Assistance

• Expanded Emergency Homeowner Assistance for Low Income Households

Key action steps for implementation were provided.