COM 0463.005 2004-2006 - Laserfiche WebLink

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1?;02:05 FRI 19: d9 F9S 808 906 8S?2 {VP. 5HIPMAN _ _ ~i,~,12 -2- Jecemba 2,2G0~ W.H. SIIIPMAN, LTD. of public servants (i. e. police and fire perswmel) to mainland locales ti*~here they can find higher quality housing at lower prices while earning higher salaries. Rousing affordability is affected by many factors including: • Available Income • Interest hates • Supply of Housing • Demand for Housing Individual communities such as ours are not well able to conU~ol hen of these Eactor.~: Interest Rates that are set by national market forces and Demand in a market that u fluid locally, nationally and internationally. That leaves us to focus our attention primarily on Supply and Income over which we have somewhat more but stiL' limited control. I am concerned L•hat by Crying to increase housing supply by requiring businesses to either build an affordable house for every fourth employee or to pay an afordabh housing credit of about $So,ooo the result will be to discourage businesses from expanding, building or renovating. This will likely depress income available frai housing -not increase the supply of housing. An example may illustrate the Pont: Example: A business finds its quarters to be cramped and izlef3cient. c rimer-. determine that the business must either shrink (to a more faciiitq efricien~. si>e) or expand. Expansion requires moving to an industrial park and buildtn>; ne•, ' facility. The expansion wtiIl allow it to employ flee same number o[ ~:mrlc;e~_s bw: produce more products. The cost to expand includes: • Land cost • Moving Cost • Construction Cost • Permitting Costs The company currently employs 32 employees. If the :permitting costs iuclud; paying an affordable housing credit of $400,000 (32/4 " $50,000) the cost of expansion may very well be too high. If so, the decision maker will decide to shric ~ the business resulting in job ions rather then bold a nee+~ facility. In this ese th goal of adding to the housing stock by charging an affordable housing credit : esults in no housing credits paid and some jobs lost. Whoever lost a job is n..w Ics able to purchase or even rent a home. Income available fur housing has shn;nk housing supply has not increased.