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Housing task force report just part of what's needed

October 27, 2005

Members of Washington County's Workforce Housing Task Force on Tuesday suggested that restructuring the county's excise tax and allowing manufactured housing in residential areas could make it easier for working families to purchase homes here.

We believe the solution will be more complicated than that. If the County Commissioners are serious about getting this done, they will have to commit some serious money to solutions.

In Tuesday's presentation, the task force suggested that instead of a flat excise tax of $13,000, the tax should instead be assessed on a square-footage basis.

Under that scenario, someone building a home of less than 1,000 square feet would pay $100, while the owner of a 6,000-square-foot home would pay $26,715.

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This proposal suggests two questions: Will someone who can afford a 6,000-square-foot home balk at the higher fee, or just fold it into their mortgage financing? And, if the purpose of the higher fee is to assist in the creation of affordable housing, shouldn't at least some of the fee be dedicated to that purpose?

In regard to manufactured housing, there is no doubt that homes built in factories and delivered to building sites for assembly are cheaper than so-called "stick-built" homes. Any zoning prohibition on them in residential areas should be amended out of the county zoning ordinance.

But in our view, the problem is not the type of housing, but the fact that with building lots averaging more than $50,000 per acre, there is little incentive for builders to place lower-cost homes on such lots if there are buyers willing to pay for more elaborate homes.

To get affordable housing, county government could do three things:

  • Encourage first-time buyers to look at existing homes that need work and provide tax credits for repairs to those who meet certain income guidelines.

  • Require developers to include a certain percentage of affordable homes in large subdivisions, much as is done in the Moderately Priced Dwelling Unit program in Montgomery County, Md.

  • Issue bonds to purchase tracts of land which could be devoted exclusively to the construction of new, manufactured housing.


The bonds would be repaid by purchasers of the homes, who would agree that when they sold, their profit would be limited to the increase in the inflation rate. Any proceeds in excess of that would go back to the program.

If this last suggestion seems like a radical step, consider that in the early 1980s when mortgage interest rates hit 16 percent, another group of County Commissioners issued bonds to provide lower-cost mortgages for local buyers.

Between early 1982 and May 1983 when interest rates began to drop, the county loaned out $5.6 million to 150 homebuyers who felt lucky to get mortgages at 13.87 percent.

That board of County Commissioners responded in part because area builders and real estate agents protested that the high interest rates were killing their businesses.

Will the current board respond to the needs of would-be homebuyers? We await their decision with great interest.

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