Affordable senior housing will be part of the social safety net going forward and could even help solve federal budget woes, says a nonprofit organization that’s utilizing government programs and grants in a concerted effort to meet the upcoming “tremendous need” for affordable housing as the nation’s senior population expands.
National Church Residences, based in Columbus, Ohio, is the largest sponsor of the Department of Housing and Urban Development’s Supportive Housing for the Elderly (Section 202) program, with a growth strategy that includes participating in tax credit programs along with other federal housing programs and local housing grants.
Their efforts are similar to those of California-based GHC Housing Partners, a private company that’s buying up Section 8 housing (government-subsidized rental apartments for low-income people, including seniors) to “reshape the face of affordable housing” and fill a widening gap between the amount of available affordable senior housing and the growing number of seniors who will potentially need it.
A new model under development places housing and community services under the same roof, and NCR is “very actively” involved in trying to situate adult day care either in or close by senior housing, says Tom Slemmer, president and CEO of NCR, naming an Ohio project where 100 units of senior housing are being co-located with an adult day care center.
“We’re really engaged in community-based services, trying to develop the intersection of housing and services while solving some of the federal budget problems,” he says. “A lot of it is driven by demographic problems with the costs of healthcare escalating.”
Cost-effectiveness of supportive services
The Supportive Housing for the Elderly program shares similarities with the assisted living concept in that it provides housing with supportive services for the elderly. Slemmer says his company is “most interested” in HUD’s Assisted Living Conversion Program and has been a leader in receiving grants for converting housing units into affordable assisted living to allow elderly residents to age in place.
He says that through the program, “HUD is trying to demonstrate that housing with services can be a lower-cost option than a nursing home.”
Assisted living comes with a much lower price tag than nursing home stays, which are often funded by Medicaid. In 2011, assisted living facilities cost an average $41,714 a year—significantly less than the $78,110 cost of a semi-private nursing home suite, according to a MetLife Mature Market Institute study.
Even though assisted living generally costs less than nursing home care, it’s primarily private pay and can pose a burden for many. Virtually all of NCR’s completed projects and communities for low-income seniors are 100% occupied, according to Slemmer, pointing toward the need for more affordable senior living options.
Fighting for funding
However, the nonprofit is being forced to deal with those federal budget woes it’s seeking to solve, which can affect the availability of funding. Similar to many other government departments, HUD’s funding has been cut in recent appropriation bills, affecting its various senior housing programs and making it harder for organizations like NCR to carry out projects.
“[Funding] was zeroed out last year, and there was a big struggle in the appropriations process to get it funded for the future,” says Slemmer.
But it may be in the government’s best interests to preserve its senior housing programs.
“Senior housing is a bargain because it’s providing lower-cost options for seniors,” Slemmer says he’s been telling appropriators. “It will be part of the social safety net going forward, but we’re producing less today than we ever have in the last 50 years.”
That’s a big concern for those in the senior housing field, Slemmer continues.
In the Pipeline
Despite funding struggles, five NCR projects have been awarded $27 million since 2009, and Slemmer says his organization has been using tax credit programs as well as HUD’s Section 223 loan program.
NCR is using capital advances through HUD’s Section 202 program to build a 66-unit project at the King’s Dominion in Lubbock, Tex., and other Section 202 projects are being planned for Pittsburgh, Pa. and St. Louis, Mo.
In Atlanta, Ga., the nonprofit is using Low Income Housing Tax Credits (LIHTC) to build the 100-unit Baptist Gardens senior housing community, while the 48-unit Betmar Village is being financed with a mix of Section 202 funds, bond financing, and LIHTC.