The need for affordable housing is surging in cities across the nation, according to leading mayors.

High housing costs, low-paying jobs, and foreclosures are the top reasons driving the growing demand, report the mayors in a survey conducted by Affordable Housing Finance. Twenty-three big-city mayors took part in the survey, with 21 of them leading municipalities that are among the nation's 50 largest.

“As people lose their jobs, lose their homes, and suffer from the current national economic crisis, there will be continuing demand for additional units, especially rental units,” says Louisville, Ky., Mayor Jerry Abramson.

None of the surveyed mayors foresee demand waning in the year ahead. The best that a few can hope for is that the need will stay level.

Abramson and other mayors stand on the front line of the issue, as they are among the first to see the lines of people waiting for affordable housing and to witness the growing number of homeless on their streets.

Mayors are important to affordable housing developers because their vote can lift or sink proposed projects not to mention determine how limited public funds are spent.

“Even though housing policy is made in Washington and housing finance matters are frequently addressed at the state level, housing has to happen at a physical place, so it really falls on local officials to be the prime movers with respect to the location, the supply, the production, the approvals, the quality, the adequacy of affordable housing,” says Henry Cisneros, who was a four-term mayor of San Antonio before becoming the nation's housing chief.

When taking the mayor's seat in 1981, Cisneros' mantra was “jobs and economic development.” His view expanded after seeing the impact of housing on a city.

“More and more local officials have recognized that the most durable form of economic development is a community of homes,” says Cisneros, who was secretary of the Department of Housing and Urban Development under President Bill Clinton. “Every one of those rooftops is a family budget, an income, a market for commercial products.”

The best mayors are those with a comprehensive strategy to address the full spectrum of housing needs, he says, citing the efforts of several mayors, including Thomas Menino in Boston.

When a mayor sets a strong agenda for affordable housing, it can be the catalyst for the whole city structure to move, according to Cisneros, who's now executive chairman of CityView, a firm that builds workforce housing.

Changing face of need

In addition to seeing increasing demand, the surveyed mayors are finding their homeless populations and others in need of affordable housing dramatically changing.

Leaders in Boston, Indianapolis, Las Vegas, Louisville, Minneapolis, Phoenix, San Francisco, Jacksonville, Fla., and Gastonia, N.C., all note that more families are struggling to find housing.

“The homeless population is changing as the effects of foreclosure and job loss become realized,” says Minneapolis Mayor R.T. Rybak. “More and more families are being served at local shelters, and the demand for these services is higher. This reverses a trend of few families being served as documented as little as 18 months ago.”

Gastonia, with a population of about 70,000, is the smallest city to take part in the survey. Mayor Jennifer Stultz co-chairs the U.S. Conference of Mayor's task force on hunger and homelessness, along with San Francisco Mayor Gavin Newsom. Her area has also been hard hit by the economic downturn, with layoffs and plant closings pushing the unemployment rate in Gastonia County to an all-time high of nearly 12 percent. That's resulted in more large families and single-parent families in need of help.

Other changes are also being observed.

In Austin, home of the University of Texas, there is a drop in recent college graduates living in the city. One explanation is that these young adults are moving away as housing becomes more expensive in the city.

A growing number of seniors need affordable housing in Columbus, Ohio; Long Beach, Calif.; and San Jose, Calif. And in Long Beach and Washington, D.C., officials cite increased pressure for special-needs housing.

Money for housing

Thirteen of the surveyed mayors expect to increase or at least maintain current levels of funding for affordable housing this year. Several cite having dedicated funding sources such as a housing trust fund, a general obligation bond, or a housing levy.

Officials in six cities remain uncertain if less money will be available for affordable housing, while four mayors expect some program cuts or changes this year.

Many cities rely heavily on federal Community Development Block Grants (CDBGs) to support their housing and community development efforts.

“It is unfortunate how dramatically CDBG funding has been cut federally over the last six years,” says Austin Mayor Will Wynn, who is coming to an end of his term. “While I am proud that we are generating funds locally, the fact that it now has surpassed federal funding presents an ongoing challenge for Austin in continuing to rise to the challenge of providing affordable housing.”

In Columbus, funding for homeowner rehabilitation has been significantly affected by cuts in CDBG income, says Mayor Michael B. Coleman. Average cuts in this area are at about 40 percent.

Under the White House's budget plan, CDBG would be fully funded at about $4.4 billion in 2010 and would be revised to better target assistance to distressed areas. In recent years, the program has been funded at around $3.6 billion.

Most effective programs

Cities have created different policies and programs to encourage affordable housing production.

For five mayors, one of the most effective tools has been inclusionary zoning ordinances or similar policies that require or offer strong incentives to include affordable housing units in market-rate projects. For example, Sacramento adopted an ordinance in 2000 that has produced more than 1,500 affordable units in little more than five years, according to Mayor Kevin Johnson, who was elected in November. Eight cities reported having such programs.

City leaders tout other strategies as well. In Houston and Columbus, officials have concentrated their resources in the neediest neighborhoods. And, in Gastonia, the city has assisted three nonprofit organizations to become affordable housing developers.

Other mayors report that their most effective programs have been those that have raised money for affordable housing.

The San Francisco Redevelopment Agency dedicates 50 percent of the tax increment generated through real estate activities to affordable housing. The state requirement is 20 percent. In another move, the city has created the HOPE SF Fund, a $95 million locally financed version of the federal HOPE VI program, to help rebuild distressed public housing.

A few cities, including Austin and Phoenix, have passed large general obligation bonds that have raised money for housing projects, and Seattle residents have regularly voted for a property tax measure for affordable housing.

The mayors were also specifically asked about homelessness. Twenty-one of the 23 cities have 10-year plans to end homelessness. Only Boston and Charleston said they did not, although Boston plans to spend more than $26 million on programs for the homeless this year, one of the highest amounts among the participants.

The surveyed cities expect to spend about $11.2 million on average for programs specifically for the homeless this year. Cities that are among the nation's 50 largest were counted in this calculation.

Leaders in Charleston, Denver, Gastonia, Houston, San Jose, and Seattle said Housing First or rapid rehousing programs have been among their most effective strategies for reducing homelessness. The Housing First approach calls for placing homeless individuals into apartments quickly. The immediate focus is on stable housing and then services. Even more cities are getting behind permanent supportive housing. Indianapolis and Washington, D.C., said they are shifting toward these long-term developments and away from transitional housing or shelters.

Mayors' wish lists

The mayors have strong opinions of what they would like to see developers do more of in their cities.

Not surprising, the most popular answer, cited by seven mayors, is leverage additional private funds or tap new funding sources.

Five mayors report that they want developers to build more infill projects or within their downtown neighborhoods. Dallas Mayor Tom Leppert and Phoenix Mayor Phil Gordon both cite their desire for more transit-oriented developments along their light-rail systems.