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Delaware grapples with housing shortage as a task force weighs local control against urgent demand

A new housing task force has begun work to address the complex issue of affordable housing in Delaware.
Delaware Public Media
A new housing task force has begun work to address the complex issue of affordable housing in Delaware.

How to handle the affordable housing crisis in the First State has been among the top issues during the 2024 election, but work on the issue is already underway in Delaware.

This week, contributor Paul Kiefer takes a closer look at that work and what options it may provide a new Governor and General Assembly with to address this complex issue.

DPM contributor Paul Kiefer reports on the Delaware housing task force's work to address the state's housing crisis

The fight over how to fix America’s housing crisis has largely been fought in local zoning boards and city councils. But as the scale and costs of the crisis become clearer, a growing number of state governments are stepping in to coordinate responses.

One of those efforts is currently playing out in Delaware, where policymakers, advocacy groups, and trade associations — all part of the state’s new Affordable Housing Production Task Force — are in the early stages of negotiations over a collaborative response to the state’s escalating housing shortage.

But why now?

“Hindsight is 2020 but you know, things really changed during the pandemic. And one change was that developers pulled a lot of building permits and started building a far greater number of housing units in Delaware than we had seen on average in previous years. So, great news. Everybody wants to come to Delaware,” said David Edgell, Director of Delaware’s State Office of Planning Coordination.

He adds the state’s residential construction boom has one glaring problem.

“Unfortunately, we're kind of stuck in this, you know, lowest common denominator type of zoning is common, which is, you know, everything is single family until you ask to change it,” said Edgell.

He’s referring to detached single family homes — a style of home that made up more than 80% of all new residential units permitted in Delaware since 2020. By 2021, median prices for single family homes in the state approached $300,000.

In a 2023 Housing Needs Assessment, the Delaware State Housing Authority found that the state’s housing supply has shortages at both ends of the price spectrum. While it receives less attention than the shortage of units affordable to the lowest-income Delawareans, DSHA Chief Strategic Advisor Caitlin Del Collo says that the shortage of units at prices affordable to the highest-income Delawareans can have trickle-down effects.

David Edgell, Director of Delaware’s State Office of Planning Coordination.
David Edgell
David Edgell, Director of Delaware’s State Office of Planning Coordination.

“We know that we have very high income renters who are down renting — renting units that are cheaper than what they can afford. That creates scarcity for people that make less money than them, and it just puts this downward pressure on the market,” said Del Collo. “So we're being squeezed from both sides. And so that's why you know that we need to increase supply. But it can't just be supply for market rate. It can't just be supply for extremely low income. We need to be able to increase it across the board to meet the needs of all those households.”

In other words, Del Collo says, the solution to Delaware’s housing problems is building more housing — and more types of housing. By her agency’s estimate, Delaware is short roughly 14,000 units of housing affordable to the lowest-income households and more than 20,000 units affordable to the highest-income households.

All parties involved in the state’s Affordable Housing Production Task Force seem to agree that the solution will involve building more housing.

But that’s a delicate process, and not everyone on the task force sees eye-to-eye about what stands in the way.

“Our state enabling statutes for zoning are, like many other states, they're based on a 1926 you know, standard state enabling legislation that was promoted by the US Department of Commerce, of all places,” said Edgell. “So it's, it's kind of regimented — you get districts, and you've got regulations per district and all these kind of things.”

Edgell argues the century-old approach to zoning — one that treats single family homes as the default in most residential areas — often leaves developers interested in building other forms of housing that could be more affordable to the average Delawarean waiting for months or years for approval from a local zoning board.

“We don't want to go through a six month, one year, two year process that costs time and money and legal fees and things, and then maybe at the end, we don't even get to do what we'd like to do,” said Edgell.

Elsewhere in the country, state governments grappling with their own housing shortages have opted to intervene in local zoning rules. Last year, Montana lawmakers voted to allow duplexes and accessory dwelling units, or ADUs, to be built in most residential areas statewide — a move recommended by that state’s own housing task force. That law prompted a lawsuit by neighborhood advocacy groups opposed to density increases and state interference in local control

State Sen. Russ Huxtable (D-Lewes), who sits on Delaware’s task force and led the General Assembly’s efforts last year to shore up affordable housing construction and maintenance programs, pointed to a similar bill introduced by Delaware lawmakers last year — a bill he considers a starting point for the state’s efforts to lower barriers to expanding housing supply.

“I think we started it with our ADU ordinance last year, right? We introduced an ordinance that required jurisdictions to create their own ADU ordinance,” said Huxtable.

The bill never made it to Gov. Carney’s desk, but Huxtable says that its introduction alone was enough to move the needle in some Delaware towns.

“Just by the introduction of that bill, several jurisdictions have started to look at their ADU ordinance and start revising their own."
Democratic State Sen. Russ Huxtable

“Just by the introduction of that bill, several jurisdictions have started to look at their ADU ordinance and start revising their own,” he said. “So sometimes it doesn't necessarily take an act of the state legislature.”

But state Sen. Gerald Hocker (R-Ocean View), Huxtable’s Republican counterpart on the task force, argues that state rules — not zoning rules controlled by local governments — are to blame for the state’s housing shortage.

“I've gone through so many zoning approvals, and that is not as costly — outside of cutting down your density — as DelDOT and stormwater and and all the other state regulations. Zoning approval is usually County, and they're a lot easier to deal with in the state,” said Hocker.

Like Huxtable, who previously worked for an affordable housing developer, Hocker speaks from experience.

“I'm in the process and now getting all the zoning and all the approvals to build a workforce housing project. We have 26 acres, and we had a plot plan that we thought would get approved. Because of buffers and storm water and all that, they cut the density down there. I forget how many, 20 some units, when you take 20 some units out of the mix of the same final call site plan costs and all that adds that much more to the project,” said Hocker.

He says the costs of keeping up with required infrastructure updates and DNREC rules can pile up, reducing incentives to build the denser, more affordable forms of housing his businesses need to attract employees.

“I run supermarkets — two supermarkets. I heard a guy from Pennsylvania I thought was going to come to work for me. He was in the process of giving his notice, and he couldn't find a formal place to live here, so he turned down the job,” said Hocker.

And Delaware’s League of Local Government, which also holds a seat on the task force, is also firmly opposed to top-down approaches to expanding the state’s housing supply — approaches that might, for instance, involve the state requiring all municipalities to allow some forms of multifamily housing in all residential areas, as states like Washington have attempted in recent years.

In a prepared statement, League of Local Government Director Kevin Spence told Delaware Public Media that municipal governments are willing to make adjustments and work alongside state partners, so long as they aren’t required to cede control.

Sen. Russ Huxtable represents the 6th Senate District.
Russ Huxtable
State Sen. Russ Huxtable (D) represents the 6th Senate District.

The league does not support a top down approach, but instead it reinforces Home Rule, which supports local autonomy when it comes to most issues, including affordable housing,” he said “Among those solutions, the league has been encouraging decision makers to provide a list of housing options from which local municipalities could choose which best fit their local needs and demands. What Works in blades doesn't necessarily work in Newark, for example.”

Nobody on the task force — Huxtable included — is eager to upend Delaware’s reverence for local control.

“I don't think the legislature should just come and say, ‘hey, boom, this is what we're doing. I've got the votes. I'm passing this I don't care what your feedback is.’ No, I think we care what the feedback is. We do it carefully,” he said.

And state agencies like the Office of Planning Coordination are preparing to play a support role as municipalities weigh their options.

Edgell argues so-called “form based codes” are one such possibility. Compared to the century-old approach to land use on the books today in Delaware’s municipalities, he says form-based codes offer a simpler path to approving denser, more affordable housing.

"That code might say things like, ‘on this street, two story mixed use buildings. You've got apartments up top and you've got retail down below.’ Or it might say, ‘in this area of town, we're having, we're going to have row houses or townhouses. Your townhouse has to be three stories and 10 feet from the street. Go forth and build it.,’" said Edgell.

Allowing municipalities to streamline their codes, Edgell adds, would likely require some clever legal maneuvers to work within the state’s enabling statutes for local zoning — or a change to state laws.

At a task force meeting last month, Del Collo offered another half-dozen options for municipalities to consider: New Jersey’s model for mediating land use disputes between municipalities and developers, for example, or versions of the density bonuses offered by Sussex County.

And while the agency is generally tasked with supporting affordable housing development, DSHA Director of Housing Development Stephanie Griffin says her office may even be able to help support projects that meet demand from Delawareans at the middle of the income spectrum.

“We don't typically fund market rate development. It can be layered in. So, we have instances of mixed income developments where the capital stack does include DSHA funding, which typically finances the affordable units, and then there's other funding sources that come in and help finance the more market rate ones,” said Griffin.

Most importantly, DSHA’s Del Collo says, the state needs to give municipalities a chance to take stock of the crisis and learn from other jurisdictions around the country experimenting with fixing their own housing shortages.

“Time I think, is a really helpful ingredient in getting communities to understand what the possibilities are."
DSHA Chief Strategic Advisor Caitlin Del Collo

“Time I think, is a really helpful ingredient in getting communities to understand what the possibilities are,” she said.

Edgell shares that optimism; he believes the task force is a sign that local governments and private sector partners are open to solutions.

“I think each local government can look at their comprehensive plan and look at their land use and find areas where they would like to encourage that. Their plans actually say they'd like to encourage that. It's just going that next step, and actually, you know, changing the ordinances and letting them do that.” Edgell said. “They haven't really had a chance to think about it and see, you know, what impact their local land use regulations or processes have on the production of housing that's affordable to the average Delawarean.”

But Hocker is not as hopeful.

“No matter what the task force does and what, no matter what the task force recommends under our existing General Assembly, I don't have much hope,” he said.

So far, the solutions he favors — namely rolling back state regulations requiring things like forest buffers around new housing developments — haven’t received much attention from the task force.

His discontent points to the growing possibility that efforts to address Delaware’s housing shortage could become bogged down by partisan politics.

The partisan battle lines on housing policy have yet to fully crystalize in Delaware’s gubernatorial race.

In a debate hosted by Delaware Public Media and the Univ. of Delaware earlier this month, Republican candidate and House Minority Leader Mike Ramone offered familiar talking points about local control and deregulation when asked about strategies to boost affordable housing production.

“In the state, our job isn’t to write up the regulatory zoning and all. Our job is to create the business cycle that goes faster,” he said.

Affordable housing was among the topics Delaware's gubernatorial candidates, Democrat Matt Myer and Republican Mike Ramone, discussed during their debate at the University of Delaware in October.
Evan Krape
/
University of Delaware
Affordable housing was among the topics Delaware's gubernatorial candidates, Democrat Matt Meyer and Republican Mike Ramone, discussed during their debate at the University of Delaware in October.

Democratic candidate and New Castle County Executive Matt Meyer — whose administration has experimented with strategies like offering density bonuses and expedited review for affordable housing developments — responded to the same question by arguing the state could streamline housing production by centralizing the regulatory agencies involved in the process.

“What I saw when leading the county is that when an investor comes who wants to invest in affordable housing, you have local jurisdictions pointing at the Department of Transportation, which then points at DNREC, which then points at the fire marshal,” Meyer said. “We’re going to create a single office that businesspeople can go to, that housing developers can go to, that will streamline the process. You go to Philadelphia, 1.6 million people, there is a single government. In Delaware, a million people, there are 50 or 60 governments. We need to make sure they’re working together.”

While the question didn’t stir any sharp disagreements between the candidates, as housing policy debates seep into the platforms of presidential campaigns, the risk of partisan polarization on the subject becomes all the more acute. Over the past year, the Trump campaign has staked out a position in opposition to zoning reforms and housing density increases, arguing that those tactics constitute a “war on the suburbs.”

And at a rally in Charlotte, North Carolina in August, Vice President Kamala Harris embraced the cause of supply-side fixes to the nation’s housing crisis.

“We need to build more housing in America. And so we are going to cut red tape and work with the private sector to build 3 million new homes by the end of my first term,” said Harris.

But for now, Delaware’s Affordable Housing Production Task Force will remain a bipartisan undertaking. The Task Force will report its findings and recommendations to Delaware’s next governor in March 2025.

Corrected: November 6, 2024 at 11:20 AM EST
This story has been updated to properly attribute the following quote:

"We don't typically fund market rate development. It can be layered in. We have instances of mixed income developments where the capital stack does include DSHA funding, which typically finances the affordable units, and then there's other funding sources that come in and help finance the more market rate ones"

The person quoted was DSHA Director of Housing Development Stephanie Griffin. It was previously attributed to DSHA Chief Strategic Advisor Caitlin Del Collo
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Paul Kiefer comes to Delaware from Seattle, where he covered policing, prisons and public safety for the local news site PubliCola.