Universal Sales Pitches to the Voters on Debt for Affordable Housing

Two multimedia pieces addressing Rhode Island ballot question number 7 — to borrow $25 million through bond sales for affordable housing — are starkly different.  Both are essentially given over to advocates for the new debt, but in one case, the journalist does a reasonable job of raising possible objections, if not quite going so far as to play devil’s advocate.

That example is Ted Nesi in this week’s edition of his still-new show Executive Suite.  Both of Nesi’s guests, Nellie Gorbea, executive director of HousingWorks RI, and John Marcantonio, executive director of the Rhode Island Builders Association, are advocates for the debt, but the host gives some voice to the taxpayers’ and homeowners’ concerns.

More significant, though, is that Nesi’s phrasing leads both guests to raise related issues that begin to offer clues about other — more causative — problems in Rhode Island public policy.  Marcantonio argues that state and (especially) local regulation are prohibitively high.  “In a low-regulated state, the average cost of regulation for a house is around 14%” of the total cost of building, he says.  “In a highly regulated state like Rhode Island —if it’s not the most, it’s close to it — it can be up to 36% of the total cost of the house.”

For her part, Gorbea points out that both Massachusetts and Connecticut include affordable-housing investments in their regular budgets.

Combine those two ideas, and a little thought might bring you to the conclusion that bonds — beyond adding even more additional structural costs to the general operation of Rhode Island — continually ease the pressure on elected officials and appointed bureaucrats to fix the underlying problems.  Housing is important, so the government should make room for it in its bloated budget.  And regulations have costs with which communities really should learn to grapple as the busybodies strive to create their perfect communities.

In contrast to Executive Suite, Flo Jonic’s Rhode Island Public Radio piece on the topic is more in keeping with NPR-style advocacy.  In well-produced audio, we meet two single mothers who might (or might not) gain homes through the program, one of whom refers to “a lot of cold-hearted landlords out there.”  The factual matter of real interest in the piece comes from RI Housing Director Richard Godfrey, who says the 2006 bond for the same purpose was “matched” 8 to 1 with other money, while this bond would be matched 5 to 1.

The interested listener may wonder what these other sources of money might be, because Godfrey makes clear that it’s not lined up, but rather must be sought and is not guaranteed.  One source, I believe, can be additional bonds at the local level, when cities and towns add to their own debt to claim the “matching” funds seeking matching funds from the state.

Really interested listeners may also wonder where these estimates come from.  Secretary of State Ralph Mollis’s voter guide claims that question 7 is “expected to be matched by approximately an additional $225,000,000 in funding from other sources.”  That’s actually 9 to 1.  I have an email out to Mollis’s office about this discrepancy, but whatever the answer, one begins to worry that there might be a bit too much unanimity across government, advocacy, and media on these sorts of issues of public concern.

For my part, I continue to question how it could possibly be economically healthy to pump hundreds of subsidized low-cost housing units into a market that is unceasingly losing value even as its inventory continues to climb.