It’s not making mistakes that so typifies the zealotry of Modern Progressivism ideology, it’s the inability to recognize, admit, and take measures to avoid repeating those mistakes which is so breathtaking. Here in Orange County, we have the latest example of Progressive government meddling gone wrong in the housing market. Specifically, we have news of the impending bankruptcy filing for that Chapelboro Progressive darling of a “green” urban mixed use real estate development, aka Greenbridge.

While the local Progressive media bemoans the fate of Greenbridge, once again there is no analysis as to how the failure of Greenbridge is not a private business failure, but in fact the failure of a publicly subsidized marriage of crony capitalism and affordable housing public policy. That’s right. If it wasn’t for local public moneys ostensibly set aside for affordable housing, then Greenbridge couldn’t have gotten the private capital financing to proceed.

How is that possible? Most private capital financing of real estate developments with a heavy residential component require pre-sales of a substantial percentage of units before moneys are released to fund the major construction. After all, the Bank of America lent the Greenbridge developers (Mr. Timothy Toben and company) over $43,000,000,000. The bank wanted some assurances that the public would buy what was being offered.

What were the pre-sales in Greenbridge? No one is saying. However, Greenbridge admits that of the 36 condominimum units sold to date, fourteen (or about 40%) were affordable housing units.

Affordable housing (AH) units, what are they? These are units priced at below market rates. They are never purchased fee simple outright by the buyer. Rather they are purchased through the auspices of the Community Housing Trust (CHT), formerly known as the Orange County Housing and Land Trust. Run by Mr. Robert Dowling, the CHT takes public moneys to subsidize overseeing AH properties. Neither fish nor fowl, CHT lives off public moneys ostensibly to serve a public purpose, but is not a public entity scrutinized by the public.

In reality, most of the residential “sales” of Greenbridge were sales subsidized with public moneys and public coercion. (Does anyone seriously believe that the Greenbridge developers would have discounted residential units at below market rates, but for the power of a Progressive government to withhold regulatory approval of the Greenbridge project?) In reality, public subsidies provided the illusion of demand for a private enterprise.

But that’s not how Mr. Toben sees it. ”We bailed out these banks. We've brought them out of insolvency. And what do they do but drive us into insolvency. It is really to me such a great frustration.” Is that as much frustration as that created for fiscal non-ideologues seeing public subsidies propelling Mr. Toben’s project forward on a bubble?

What will happen to those CHT units? Will CHT be assessed specially on those units? Who knows? Never fear, your tax moneys will bail CHT out. Why isn’t there a policy that public dollars for AH units should be the last money into a project, should take the least risk, and not vice versa?

You can always count on Progressives using government subsidies to create financially sustainably unsustainable programs. Just as government subsidies and meddling with Fannie Mae and Freddie Mac (with the infamous NINJA loans) brought about a housing bubble, local public AH moneys have done the same with Greenbridge.

The failure of Greenbridge will send ripples through the local housing market, e.g., the public-private 140 West Franklin (Lot 5) development. Don’t worry. You local taxpayers are good for paying the bill for cleaning up the mess.

Affordable housing is a favorite social engineering tool of Progressives. It combines income redistribution (taxing to pay for the housing) with contrived socioeconomic mixing (placing affordable housing in higher value residential areas). The image often used in Orange County to justify affordable housing is the proverbial African-American UNC housekeeper. A woman of modest education works hard to clean up the detritus of North Carolina’s privileged youth. She is said to be owed a decent place to live in Chapelboro, one she can afford with modest income but while working to her economic potential. Heaven (and Progressive social justice) forbid that she drive ten miles to an affordable neighborhood.

Contrast that image with the reality featured in the local real estate advertiser. A couple in their mid-thirties with one child is able to move into a home in the Claremont subdivision where twin townhomes start at $350,000. They do so with the assistance of the Community Home Trust (CHT), formerly known as the Orange County Housing and Land Trust, the fiefdom of local affodable housing czarMr. Robert Dowling. CHT is NOT a private bank or a credit union. CHT is the publicly funded affordable housing arm of Orange County, Chapel Hill, and Carrboro. (Don't look for the local media to point this fact out.) CHT receives public moneys (through your property taxes) from Orange County, Chapel Hill, and Carrboro to purchase homes and land. It then resells the residential buildings while holding onto the land.

The couple has moved into a 1550 square foot townhome on a 2000 square foot postage stamp lot in Claremont. However, their new home is curiously valued by Orange County. The building has a value of about $180,000, and the land is valued at about $69,000, for a total value of about $249,000. However, for taxes owed the County, the value is listed at about $121,000. So not only has the County provided moneys to CHT to purchase the housing, it then devalues the housing so that less than market rate real estate property taxes are owed on the housing. Who makes up the difference? Everyone else who doesn’t live in subsidized affordable housing, including working class people living in modest homes. That's why the Pulp calls it “affordable hosing”.

Surely the couple must be people of modest income gathering abilities, right? Not exactly. They are college educated and not starting out in their careers. The husband is a credit analyst at Credit Suisse. The wife is a program manager at Pathfinders International, a non-profit organization that works to improve sexual and reproductive health around the world. Curiously, Pathfinders is based nowhere near Chapelboro. It’s based in Watertown, Massachusetts.

That’s right, the couple moved from Massachusetts to Carrboro to take advantage of the lower housing cost from the Boston area. Apparently, they telecommute. Homes were too expensive for them in Boston. They would have had to buy an older home and fix it up. Here they can buy just the house and it’s new, courtesy of your tax dollars.

How this couple can be considered to be in need of a public subsidy is known only to local Progressives and the CHT. Perhaps they simply enjoyed their income and went into debt, saving little for the future and buying a home. Perhaps they choose to take less income than they can make to pursue their passion. For them, government is there to bail them out with affordable housing.

So what happened to the African-American UNC housekeeper? No one seems to know. Perhaps she's too busy working trying to pay her local taxes to subsidize the Boston couple moving to Carrboro.

In most of North Carolina, a town that sits on thousands of cheap rental apartment units would not consider itself to have a problem with affordable housing.

However, Carrboro is most certainly not like the rest of the towns in North Carolina. Here, in a predominantly rental apartment community, affordable housing becomes affordable hosing of taxpayers.

At a recent town governance meeting, the Boa again demonstrated its keen grasp on the physical realities of Carrboro. Mayor Mark Chilton said, “We have a lot of people who are hurting at a lot lower income levels than we’re currently reaching. Our current system doesn’t ever encourage anybody to create affordable rental housing for people who live on social security/disability income.”

Really, what about the thousands of rental apartments that start at $600 per bedroom a month? Aren’t they affordable housing?

Alderman Jacquie Gist supported Mr. Chilton, saying, “We’re doing great at reaching graduate students and not that great at reaching truly, truly poor people and we got to turn that around. The Orange County partnership on homelessness is slowly working on that, but I’m tired of putting money towards grad students.” Pulpsters will remember that a few years ago Ms. Gist suggested welcoming the homeless into Carrboro with wine and cheese accompanied in the background with sonorous string music.

Mr. Chilton didn’t reserve all of his concern for the working poor. According to Mr. Chilton, the town should be worried about those making as much as $60,000 a year. “At a hundred percent of area median, you’re really stuck. You don’t qualify for any subsidy. You don’t qualify for any help.” As someone living on a trust fund, Mr. Chilton understands the pain of living within one’s means. (See N&O Affordable Hosing Story.)

Representing the not-visibly-employed in Carrboro, Alderman Sammy Slade offered his wisdom. “There’s also a way of seeing how we compare to other places, and how we are a place that doesn’t allow for people…with more means to be in this community.” Did Mr. Slade really run on a platform of increasing tenement housing for the not-visibly-employed?

No word on whether or not the Boa will ask for a special town law capping market housing pricing, thereby enabling more people to live in Carrboro.

No word on how much more “make work” will be created to keep the overstaffed Developer Service Department looking busy rather than reducing the staff to meet actual need.

No word on whether or not Carrboro will adopt the 140 West Franklin parking garage model, where non-affordable housing unit owners park in a private gated garage area, but affordable housing unit owners park in the public garage area. (See Article VI of the Development Agreement.)

With municipal elections coming, Pulpsters know that the affordable housing whipping boy will be drug out yet again. It doesn’t matter that housing prices have moved down for almost two years. The expansion of local tax exempt bureaucracies is vital to the local economy.

In a spirit of cumbayah cooperation, the Pulp imports a suitably progressive answer to the affordable housing crisis. The Pulp looks to the Orient for the newest affordable housing mantra. More specifically, it looks towards India, land of mystery, land of excitement.

Tata, the same Indian conglomerate that brought India the pleasure of the 100,000 rupee ($2500) Nano car, is now bringing Indians the thrill of owning a ~300,000 rupee ($7800) Shub Griha house.

Here is the floor plan of the studio/efficiency condominium, all 283 square feet of it.

For those wishing to splurge, for about 550,000 rupees ($13,400), one can get a capacious 465 square feet.

In true Chapelboro progressive land use planning, Tata is densely developing these units in a master-planned, open spaced community with a homeowner’s association assuming much of the municipal maintenance role.

Here’s a look at the Shub Griha master plan. Notice the open space, 70%! Notice the density, 1182 units on a spacious 44 acres. Tatas everywhere!

Yes, the answer to the affordable housing problem in Chapelboro is as close as looking at a bodacious set of Tatas!

People vote not only with a ballot, but also with their bucks. A Carrboro apartment owner (Tar Heel Companies of North Carolina or “THC”) has just voted to remove its capital from Carrboro's municipal jurisdiction after being villified by the town elected officials.

The “good news”? By selling out, about 255 affordable housing units are being created in Carrboro by the Boa's latest innovative affordable housing policy, unequal enforcement of property rights. Town government distaste for non-pal property owners can be combined with their taste for affordable housing for people of the right diversity.

Last July, the Pulp told the Abbey Court story, an apartment complex of about several hundred units located off NC 54 in Carrboro on Jones Ferry Road. Boa members very publicly intervened with the ability of THC to control who parks in their privately owned apartment complex.

Near to Abbey Court is a makeshift day worker pickup location. The complex is also near a bus stop and has been used as an unofficial park-and-ride lot. The Abbey Court manager has been facing problems with cars in the complex that don’t belong to renters. In response, the manager has made the mistake of enforcing parking rules that included requiring official parking stickers issued by the complex and enforcing the parking rules by towing away offending vehicles.

In most towns in North Carolina, such enforcement would be no cause for government intervention. But Carrboro isn’t like most towns. When a car owner facing his car being towed in Carrboro endangers a child by stuffing them into the hooked up car, neither Mayor Chilton (who was present) nor the police intervene for the safety of the child.

In response to this incident, the Boa met in a highly unusual summer recess meeting on 31 July 2008. After much breast beating over the apartment complex owner’s exercise of control over a situation ignored by town officials, the chaotic state of parking at Abbey Court, the Boa was constrained by home rule limitations on their authority to passing an ordinance limiting towing fees to $50 in Carrboro. The ordinance also limited retrieval fees to $100 and $20 a day for storage.

On 4 August 2008, the carnage at Abbey Court continued with renters continuing to endanger towing truck operators who are complying with the law. Mr. Jesus Sanchez Basurto, 25, claimed he didn’t realize that a tow truck driver had put a boot on his car. He got into his car and tried to drive it away from the tow truck before it could hook up his car. When the car wouldn't move, Mr. Basurto opened his car door to see why the vehicle wasn't moving. He left the car in reverse. It lurched backward and ran up on the curb. Somehow he was pulled under his own car, and the car ran over his foot. The towing truck operator did nothing beyond having already put on the boot.

THC got the message loud and clear. Don’t expect to have the right to maintain control over your apartment complex without the Boa strangling that right.

THC has responded by deciding to remove its investment from Carrboro. It's test marketing six Abbey Court two bedroom, one bath condominiums at prices ranging from $54,500 to $59,500 (“as is”) or remodeled units for $79,500. (See Chapel Hill Herald Abbey Court Sale Story.)

Showing Carrboro town government’s concern for THC, Mr. James Harris, Carrboro's ED guru, said ”I'm just hoping they will follow through”.

No word on the next apartment complex owner the Boa will chase out of town, creating more affordable housing.

No word on reaction from Mr. Robert Dowling on the creation of affordable housing units in southern Orange County that he doesn't control.

No word on whether or not Abbey Court will be renamed “Carrborini Green”.

What better way to grow and perpetuate a non-governmental, tax exempt organization (NGO) than to use the current chaos from the excesses of junk mortgaging to pull at the heartstrings of local governance officials. On 4 February 2009, Robert Dowling, the executive director of Orange Community Housing and Land Trust did so, bringing in an unfortunate person facing foreclosure this month.

In the words of Housing Lord Dowling, ”In these difficult times, our focus has changed. We are seeing more homeowners who are delinquent and looking at foreclosure.” Mr. Dowling’s answer to the current mortgage mess is to give more money to OCHLT. He wants an increase in OCHLT funding from the town of Chapel Hill from the current $201,386 to $230,000, or an increase of about 14%. How this increase paid for by Chapel Hill town taxes will help a person in foreclosure distress is unclear.

Not to be outdone, Ms. Delores Bailey, director of Empowerment, Inc., yet another non-governmental, tax exempt organization, asked for $200,000 in federal block grant funds to purchase more property for Empowerment, Inc..

Which then brought to the town feed trough yet even another non-governmental, tax exempt organization. Showing her considerable marketing skills, Ms. Susan Levy, executive director of Habitat for Humanity in Orange County, asked for $450,000 in federeal HOME and CDBG funding for Phoenix Place, a “green” development of approximately 50 homes. (See Chapel Hill Herald Housing Feed Trough Story.) No explanation is given as what makes a “green” development, but it sounds nice.

Multiple requests for more NGO feeding begs yet another question be asked of the Chapel Hill governance board. Why are you funding these NGOs when the town has its own housing empire backed by 18 full time town employees?

Extent of the Town Public Housing Empire
Chapel Hill is a town of less than 75,000 with an above average regional median income. Yet, it maintains an impressive public housing infrastructure of 336 units. Tenant rents (about $403,000 or about $100 per unit per month) are subsidized by federal housing grants to the tune of $1,161,069 per year (or about $288 per unit per month). In that manner, local residents aren’t aware of the true cost of public housing. A federal tax increase isn’t the same as a local tax increase to most citizens.

To maintain this public housing empire, Chapel Hill employs 18 full time employees, in addition to private contractors. The town pays housing employee salaries of about $1,000,000 annually, or about $55,000 per employee. For the actual housing units, the town pays $127,000 for utilities, $52,000 for liability insurance, and $282,000 for maintenance. That’s a total operational cost of $1,640,629 per year or about $4882 per housing unit ($406 per unit per month).

If you do the math ($100 plus $288 per month in, $406 per month out), then you can see that the town subsidizes each housing unit to the tune of $18 per month. (All numbers are based on the reported Town FY 2008-2009 Housing Budget.)

What the town doesn’t report on is the value of such housing. The town owns public housing units in the following locations: AMP 1 - Lindsay, Craig Domains, Trinity, Pritchard Park, Church/Caldwell, North Columbia Street; and AMP 2 - S. Estes, S. Roberson, Colony Wood, Eastwood, Oakwood, Rainbow Heights. However, it doesn’t report on the variety and average size of each unit. That way, you can’t tell if the private rental marketplace is more efficient or not.

Extent of the Town Housing Loan Trust Fund
Chapel Hill contributes “feudal tithes” annually to Lord Dowling’s empire, along with the town of Carrboro and Orange County. In FY 2006-2007, the town was budgeting $106,180 for the loan trust fund. By FY 2008-2009, the town had increased that amount to $201,386, an increase of 89% in two budget cycles.

Extent of the Town Block Grant Largesse
In addition to supporting Lord Dowling’s empire and running its own housing empire, the town dispenses federal block grants to “rehabilitate” certain neighborhoods. The town’s 2007 project ordinance budget provided $596,282 to rehabilitate public housing, assist in home ownership, and revitalize the Northside and Pine Knoll neighborhoods. Nowhere does the town report on the actual number of residents benefited by these grants. By not doing so, the town makes an assessment of program effectiveness and efficiency impossible.

Pulpsters are familiar with the local Orange Progressive lament for not having enough affordable housing located within the high cost of living zone (aka high taxes without high service levels) provided by the towns of Carrboro and Chapel Hill (“Chapelboro”) politicians. (See Peeled & Sliced Archives.) The greatest local progressive political minds have been on top of the situation since the turn of this century.

What are the results of six years of intense focus on affordable housing policy by OPie boutique governments? The answer is that affordable housing policies have made housing less affordable, a spiral in which the more subsidies are applied, the more unaffordable the housing in general becomes. (Of course OPie apologists will proclaim that the need for affordable housing would be worse without their input.)

Within the city school district, in 2001 the average price of a new single family detached (SFD) home was $393,445. The median price (the price point at which half the homes sold where above or below) was $364,000. The average price was only 9% greater than the median price. The median income was about $43,000. The median price was about 8.5 times the median income.

By 2007 the average price of a new SFD home was $805,707. The median price (the price point at which half the homes sold where above or below) was $764,894. The average price was only 5% greater than the median price. The median income was about $55,000. The median price was about 14 times the median income.

In just six years, the cost of affordable housing to new single family home projects in Chapelboro (there’s no free lunch) contributed to a rise in median housing prices of 110%. In contrast, median income rose by a comparatively paltry 28%, although in line with income rises elsewhere in the country.

Have the OPie commishes been able to maintain the torrid pace of Chapelboro? The commishes haven’t implemented much of the aggressive Chapelboro affordable housing policies. Has there been a difference?

Within the county school district, in 2001 the average price of a new SFD home in the county was $233,626. The median price (the price point at which half the homes sold where above or below) was $228,000. The average price was only 3% greater than the median price. The median income was about $43,000. The median price was about 5 times the median income.

By 2007 the average price of a new SFD home in the county was $337,775. The median price (the price point at which half the homes sold where above or below) was $284,968. The average price had climbed to 18% greater than the median price. The median income was about $55,000. The median price stayed at about 5 times the median income.

In the same six years that saw Chapelboro SFD homes become even more unaffordable, rising from 8.5 times median income to 14 times median income, the cost in the county outside Chapelboro saw a rise in median housing prices of 25% versus Chapelboro's rise of 110%.

“Amazingly”, the OPie jurisdiction without the more costly affordable housing policies had median housing prices move with median income, which rose by 28%.

Median Affordability Index is the multiple for the median income to equal the median SFD prce.

One of the Orange progressives mantras is that housing is just plain unaffordable for “too many” locals. That phrase “too many” isn’t quantified, but rather is felt in one's progressive heart in a progressive way.

Pulpsters know that the progressive answer is to create a non-governmental, tax exempt organization that becomes self-absorbed in perpetuating itself. (See Peeled & Sliced Affordable Housing.) The local hallmark tax exempt, government grant institution for affordable housing (yes, there’s more than one) is the Orange Community Housing Land Trust (OCHLT).

The OCHLT business model is to get government money to pay salaries, pay expenses, and also to buy houses. Maintenance? Oops, OCHLT now needs government grants for that too! These houses are flipped to less than 80% median income buyers, with the retention of a ground rent by OCHLT.

What’s a ground rent? The buyers never own the land their house sits on. They own the building, not the land. This is the favorite mechanism used by the landed gentry of English cities to maintain control and power. Most of central London is based on the wealth and power building of feudal ground rents.

OCHLT goes one better. They include a restriction that prevents the owner from selling to anyone except someone approved by… you guessed it, OCHLT! They also include a restriction as to how much equity the owner can realize, despite what the moves in the housing market. OCHLT “serfs” can only get 1.5% gain per year of “service”.

So who can qualify for an OCHLT ground rent home. In a recent sales pitch on the wonders of the OCHLT in a Chapel Hill real estate advertiser ( Chapel Hill News OCHLT Promotion), OCHLT executive director Mr. Dowling puts forth that a family of three with an income of $51,350 in Chapel Hill or Carrboro needs government help in buying a home. Of course, the help he has in mind is buying a home owned by the OCHLT in perpetuity, giving Mr. Dowling a job, in perpetuity.

Is a local family earning about $51,000 in trouble? According to Mr. Dowling, a former New York City banker and above median income earner, it is. That family earns less than 80% of the local median income.

So what can this economically disadvantaged family buy without Mr. Dowling’s help? What can they buy where they get all of the equity value increase over the years? According to a web based real estate database ( Trulia) the median home price in the Carrboro 27510 zip code area (historic Carrboro) for July to September 2008 was $182,500. (Half the homes sold for less than $182,500.) According to standard mortgage guidelines that family can afford at least a $150,000 mortgage. With a ten percent down payment, they can afford at least a $165,000 house.

Amazingly, local governance boards don’t ask the OCHLT how they qualify the $50,000 economically disadvantaged family. Are two potential income earners in the family? Has one simply elected not to work? Has one simply elected to earn less than their income potential because the OCHLT program is available? What is the net worth of the potential income earners in the family? Are any trustafarians (receiving money now or in the future) in the family? According to Mr. Dowling, it’s first come, first served… in perpetuity. All paid for by local taxpayer grants to OCHLT… in perpetuity.

No word from Mr. Dowling as to why local institutions will pay living family wages if they know the OCHLT stands ready to support a family on non-living wages?

In particular, no word from Mr. Dowling on why the hundreds of local tax exempt organizations would pay a living family wage if they know the OCHLT stands ready to support a family on non-living wages?

In March 2008, the Pulp reported on the Boa providing a cornucopia of monetary gifts to Roberson Square, one of the many developer pal groups concentrating on densifying the Carrboro historic district.

The developer pal party continues with an even denser project.

On 26 August 2008, the Boa approved the Butler project off Brewer Lane. As approved, the current 3400 square feet of commercial use (sf) will balloon to a lower floor of 22,170 sf of office space capped by four residential floors, totaling 57 units in 76,793 sf (for an average size of about 1350 sf). Underneath will be a two story parking garage with 136 spaces, thus adding another 40,000 sq ft to the project total (about 140,000 sq ft). Pulp readers should remember that the Roberson Square project approved in February 2008 had more commercial/retail space (about 32,000 sf) but less residential space (only 18 units in about 33,000 sf for an average size of about 1800 sf).

Of course, an affordable housing component has been leveraged out of the developer for the yet another southern Orange tax-exempt organization, the Orange County Housing and Land Trust empire that continues to grow. Mr. Robert Dowling, head of OCHLT, having recently received a 25% salary increase in bad economic times, approved by the Boa and paid for by local taxpayers is not happy with the gift of five units.

The Boa reduced the originally proposed nine units (total of 6750 sf) to only five units, so long as the developer pays $100,000 to the OCHLT town fund for each of the four units not built. At 750 sf, Mr. Dowling considers the originally proposed affordable housing units too small in size, likely to attract young single people, not the true low-income residents Mr. Dowling wishes to attract. In Mr. Dowling’s words on young single people,”They're not bad people, but they're temporarily low income. And as a result this is transitional housing for them.” So four of the five units to be built will be upped to about 1000 sf each.

As with the Roberson Square project, The Butler ”virtual children” will play in the courtyard used by the ground floor businesses in lieu of real recreational facilities. Again, this project is designed to retail at a nominal $250 per sf.

Again as with Roberson Square, the Carrboro Developer Service Department (aka town planning staff) orchestrated a plan to change the “rules” for The Butler. According to the town planning staff, there’s no problem with The Butler being built (all almost 140,000 some sf) on the existing about .9 acre site without additional area logistical staging and construction parking. Supposedly, historic business district parking and traffic flow will not be adversely affected.

More importantly, the infamous town zoning PILOS (”payments in lieu of”, see were brought out in full force. Town staff recommended granting the developer PILOs for a reduction recreational facilities, as well as for the need for affordable housing from 9 units (comprising about 7000 sf) to five units comprising about (5000 sf). (See Pulp PILO Virtual Affordable Housing Debate.).

Ordinarily, existing zoning laws would require a project of this magnitude to have 149 parking spaces, and not the approved 136 parking spaces, a difference of 13 parking spaces. These missing spaces would require (even in the newly downsized parking space limits approved recently by the Boa) the developers to convert an additional 5100 sf of the about 140,000 sf total project developed area from what is now revenue producing area into parking. At a sales revenue value of $250 per sf, the Boa approval of reduced parking is worth about $1,275,000 to the developer.

Perhaps more interesting is the parking algorithm in existing zoning ordinances. The table below compares the physical attributes of Roberson Square versus The Butler. Even though The Butler has three times the number of residential units found in Roberson Square, parking spaces are barely doubled. Such is the genius of the Boa. Such is the “parking plan” of the Boa. (See Pulp Parking Values Story.) If the residents of The Butler don’t cocoon themselves in Carrboro without a car, then an additional 30 parking spaces should have been required, carving out from revenues an additional $2,947,500 of footage.

How much do the $400,000 PILO fees “cost” the developer? By paying these fees, the developer can free about 2000 sf into full revenues. That space will yield (at about $250 per square foot) $500,000. The developer gets more.

No word from the Carrboro Developer Service Department on who will pay for the public parking garage needed for yet another dense growth limited parking jewel.

PILOs are the social engineering tool de jour in Carrboro for attracting “the right kind of people”, i.e., those who agree with the Boa, and reducing the reality based population in Carrboro. But if you’re not a stenographer, then the nuts and bolts of PILOs portends fatter profits for developers… with ordinary citizens, aka financial mules, getting the screws.

After the Boa passes the The Butler CUP building permit, Alderman Gist is reported by the Chapel Hill News to say, ”What I'm sensing now is 'community as commodity'. People build community and then other people come in and profit from the community that others created and built.” However, one is touched by Alderman Gist's concern with protecting Carrboro residents with which she agrees, it must be balanced by her lack of interest in protecting the neighbors of intrusive developments such as Pacifica or Winmore. In those cases, her sense of concern was dominated by her not liking or agreeing with those financial mules who also built their communities in Carrboro.

No word from Mr. Dowling on the real “bad people”, those who can afford housing in Carrboro without his assistance.

Like the proverbial camel poking its nose ever deeper into the desert tent, a tax supported, local non-profit bureaucracy keeps pushing further into the public purse in order to fund affordable housing. The Orange Community Housing and Land Trust (OCHLT), through its 25% annual pay increase executive director, Mr. Robert Dowling, recently attended the Fall 2008 “Assembly of Government” meetings, aka the local turf battle and catfight for Orange Progressive politicians.

Pulp readers know that the affordable housing crisis is based upon the the declared belief that the inability of “lower income” people to live near median income residents creates an imbalanced society that hurts Orange County, not financially, but psychologically. For OPie purposes, someone making 80% of the median income is “lower income”. OPies do not take into consideration if that person's income is ascendant. For example, perhaps they are beginning their career path and will make more than median income during the term of their occupancy, or they are trustafarians living off trust incomes without really having to work, or they have made life choices temporarily reducing a two income family status to a one income family status.

Creating Your Publicly Funded Lifetime Job
After declaring a crisis loudly to the “stenographer pool” (aka the local media), crack, local, wannabe, tax exempt bureaucrats swing into action.

The first step in creating your lifetime job is to announce that government is not equipped to manage an affordable housing program.

The second step in in creating your lifetime job is to advocate in front of each local governance board for the adoption of a zoning requirement for developers to provide for a percentage of smaller size housing in a development, the smaller housing being equated to less expensive housing for lower income residents.

The third step in creating your lifetime job is to advocate for funding yet another tax exempt (read non-profit) non-governmental organization in southern Orange, in this case the OCHLT, to assist “lower income” (less than 80% of the median Orange County income) residents in finding housing.

The fourth step in creating your lifetime job is to get appointed to the OCHLT at a modest salary, with testimonials from local OPies.

The fifth step in creating your lifetime job is to advocate in front of the local governance boards for funding to support your bureaucracy’s operational costs.

The sixth step in creating your lifetime job is to advocate in front of the local governance boards for capital funds to buy housing and to rehabilitate into managed lower income housing, the right to own the property being retained ultimately by your bureaucracy.

The seventh step in creating your lifetime job is to advocate in front of the local governance boards for yet more funding for your bureaucracy to oversee developer-built affordable housing.

The eighth step in creating your lifetime job is to advocate in front of local governance boards for the adoption of a PILO (payment in lieu of) financial structure for developers. PILOs enable developers to give money to the town instead of building lower income housing mixed in with higher income housing. Effectively the raison de etre of an affordable housing crisis has evaporated (the need to mix socio-economic classes), leaving only the solution to a different crisis (the need to fund your lifetime job).

The ninth step in creating your lifetime job is to ask local governance boards to funnel PILO moneys to your bureaucracy to buy yet more bureaucratically controlled housing. (See Pulp Right to Shelter Story.)

There is no final step, as bureaucracy is never ending.

Flawed Program Bureaucratic Job Insurance
Even in the current depressed local housing market, there is one constant. Averaged over a long enough period of time, all maintained housing goes up in value. Apparently, OCHLT and its abetters (the local governance boards fo Orange County, Carrboro, and Chapel Hill) forgot to include this constant in their collective wisdom of funding the OCHLT housing empire. Four two bedroom, affordable housing units in Vineyard Square in Chapel Hill went up for sale in the Summer 2007. Under the terms of the OCHLT created program, homes that were bought by lower income residents for about $92,000 had increased in value to about $100,000 over several years. OCHLT can buy back the housing at the $100,000 price.

There’s only one problem, OCHLT can’t qualify lower income homebuyers at that $100,000 price. According to Mr. Dowling, by the time you figure in higher tax rates, home owners association dues and a stagnant median income standard, Mr. Dowling says, “many potential owners are priced out”.

Put simply, the OCHLT is in a financial mode of negative cash flow even with regards to selling its permanent stable of OCHLT owned housing. It can only sell the units it bought about five years ago at a loss of about 10% of capital because median income isn't increasing apace with housing costs.

Compounding a failed business model is the fact that OCHLT puts lower income residents into housing that they cannot afford to maintain. Only after having established an empire requiring his lifetime assistance has Mr. Dowling included the cost of maintenance by lower income homeowners into the model. He now estimates that over the next 25 years (taking him comfortably into retirement) OCHLT will need at least $1,500,000 in maintenance grants to OCHLT borrowed homeowners.

PILOS of Cash to the Rescue
No need to worry. Here’s where PILOs come to the rescue. Mr. Dowling wants local governance boards to fund the maintenance grants through PILOs, in yet another local, financially imbalanced, Ponzi scheme.

Chapel Hill Councilor and public micturator defender Mark Kleinschmidt says, “I think it speaks better of us when we find other ways of taking care of our affordable housing non-profits that don't take away from the ultimate goal of putting units on the ground.,” He’s also concerned that PILOS interfere with ”getting units on the ground, having a place for people to live.”

Showing continued trouble in adopting a “facts optional” approach to governance, Chapel Hill Councilor Matt Czajkowski counters Mr. Kleinschmidt’s visions by saying, ”My notion is, we've got a problem, we don't see any other source of funding and therefore we should try to fix the problem right now by accepting payment-in-lieu.” See the Herald Sun PILO Sory.

Failure Is Its Own Reward
No word from the Assembly of Government on the causal relationship between the failure to include maintenance costs in a funding program and the awarding of a 25% annual pay increase for such failure.

In a continuing series of incremental moves designed to shelter the end goal, the town of Carrboro edges closer to a de facto citizen’s “right to shelter” from their government. On 9 September 2008, the Boa adopted changing the town affordable housing policy to permit homeowners to seek emergency repair grants (not loans), from the town of Carrboro.

The first step in a right to shelter was the declaration of an affordable housing crisis. The Boa declared that the inability of “lower income” people to live near Carrboro median income residents was said to be creating an imbalanced society that hurt the town, not financially, but psychologically. For Boa purposes, someone making 80% of the median income is “lower income”, even if that person's income is ascendant, e.g., they are beginning their career path and will make more than medan income during the term of their occupancy, or they are trustafarians living off trust incomes without really having to work, or they have made life choices temporarily reducing a two income family status to a one income family status.

The second step in a right to shelter was the adoption of a zoning requirement (now 17%) for developers to provide for a percentage of smaller size housing in a development, the smaller housing being equated to less expensive housing for lower income residents.

The third step in a right to shelter was the funding of yet another tax exempt (read non-profit) non-governmental organization in southern Orange, the Orange Community Housing and Land Trust (OCHLT), to assist “lower income” (less than 80% of the median Orange County income) residents in finding housing.

The fourth step in a right to shelter was the funding of OCHLT to buy housing and to rehabilitate into managed lower income housing, the right to own the property being retained ultimately by OCHLT.

The fifth step in a right to shelter was the funding of OCHLT to oversee developer-built affordable housing.

The sixth step in a right to shelter was the adoption of a PILO (payment in lieu of) financial structure for developers whereby the developer could give money to the town instead of building lower income housing mixed in with higher income housing. Effectively the raison de etre of an affordable housing crisis had evaporated (the need to mix socio-economic classes), leaving only the solution to a different crisis (the need to create a right to municipally governed shelter).

The seventh step in a right to shelter was funneling of PILO moneys to OCHLT to buy yet more housing.

The current eighth step in a right to shelter is the granting of giveaways to lower income residents for housing repairs.

Under a cobbled together process that the Boa dare not have introduced in one fell swoop, government money funds an organization that can put people into housing they can’t afford to maintain, and then picks up the housing maintenance costs as well. As reported by the Daily Tar Heel, OCHLT executive director and 25% annual pay increase recipient, Robert Dowling, “What Carrboro is doing is recognizing that there is a need amongst low income people for funding to help make their homes habitable. With affordable housing, it’s not unusual for homes that are sold to lower-income people to fall into disrepair over time, because to maintain a home is expensive. It’s easier to get someone into a home … than it is to allow them to be successful in being a homeowner and maintaining the home.”

Under the adopted “process”, a resident simply asks the crack Carrboro Economic and Community Development department for a home maintenance grant, saying what the money will be used for and why they should get it. In the words of the ED head, Mr. James Harris, “We know about these situations but sometimes we just can’t do anything about it. All properties are priorities to somebody.”

Ultimately, the Boa will decide to whom to give money, apparently on a “case-by-are-they-my-voting-friends-case” basis, as there are no guidelines or objective criteria for determining who should get how much money.

No word on why the Boa didn’t offer low interest FEMA type loans for housing emergencies as opposed to outright giveaways that promote not maintaining one's home.