Two weeks ago, the Dothan Housing Authority voted unanimously to invest $26 million through various sources into the Johnson Homes complex near Range Street.
To take advantage of one of those resources — tax credits — the DHA must form a limited liability corporation. Essentially, the Dothan Housing Authority, a public organization, has privatized itself for the project.
While I personally have no quibbles with improving the quality of life for all walks of life — like a $26 million investment would do — it caused me to ponder how a maneuver like this impacts the housing market. Capitalism serves as the backbone theory of the American economy — and some could view the privatization of a government entity as providing an unfair market advantage.
After all, the government sets the rules in which our (quasi?) capitalistic society operates.
To address any concerns, I asked two local officials with a vast knowledge of the housing market — DHA Executive Director Samuel Crawford and Mayor Mark Saliba. Crawford, a retired fire chief, has been addressing Dothan’s affordable housing issues for years, even before he became the DHA’s director.
Saliba, meanwhile, has been a homebuilder since graduating from college in 1982. Both said the same thing: Private entities aren’t necessarily addressing the affordable housing needs in the Dothan area today.
An affordable housing study the city conducted last year reflects that. Part of the findings noted the city lacks “price-appropriate” housing for those making less than $21,000 and those making more than $45,000.
Saliba and Crawford offered varying reasons why that shortage exists. Saliba said the federal regulations related to some affordable housing programs make it difficult for private companies to fully embrace that side of the market.
“Affordable housing is a difficult fix,” he said. “It’s an area that the private sector doesn’t mind (governmental privatization) because it’s so difficult with the regulations.”
Crawford pointed to market conditions as another reason for the void.
“Developers and realtors don’t want to develop affordable housing,” Crawford said. “We’re not in the profit business. We’re in the housing business.”
Saliba applauds the DHA’s new approach to public housing as the Johnson Homes initiative is only part of some major transformations in the organization. He sees no problem with the maneuvers as long as the federal government maintains the protections currently offered to residents in low-income housing assistance programs.
Saliba has confidence that locally the programs will work as they should.
“Around here they’ll get those protections,” he said, adding that local leaders will choose the right partnerships necessary to facilitate the transformations properly.