Neil: Hope that GA finally gets housing right

Dover City Councilman Fred Neil represents the 3rd District.

Not one single member of the Delaware legislature knows the aggregate total of annual rents that are sucked out of the state’s economy, expenses claimed or income tax paid. Don’t believe me? Ask your state senator or representative. The amount of money is staggering.

Those of us who own homes on leased land have the worst of it, as community owners bewilder, baffle and bamboozle our elected officials into thinking they are going broke. Spending less than $500,000 on my senior community of 223 homes in 2023, RHP Properties, a Michigan-based corporation, took $1.8 million out of Delaware. If a tree must be removed, RHP will not allow a homeowner to plant a new one because, when it grows to 6 inches around the trunk and 25 feet high, RHP must take care of it.

The problem facing Delaware and the nation is the lack of affordable domicile units, which doesn’t permit capitalist competition to lower rents. The tenant rentals from money allocated from all sources to build affordable housing is being bought from the original developers by private equity at a tremendous profit. The tenants then pay for the property with compounded rent increases that guarantee investors income, with no benefit to Delaware taxpayers.

There is a hope that House Bill 442 — which would set up a task force to develop workforce housing; is sponsored by Rep. Kendra Johnson, D-Bear, and Sen. Russ Huxtable, D-Lewes; and passed the Senate Housing & Land Use Committee on June 18 — will map out a housing plan with a better outcome. When I served on a task force for leased-land housing, I could not get an agreement that landlords provide a written receipt establishing the date rent was paid. This is important on leased land because, if you are late in paying rent four times during the year, you can be forced to move from the community. There is no way to stop a landlord from holding a check later than the deadline four times if the landlord wants to force you out. Only Dover has a receipt requirement.

Each year, Housing Alliance Delaware presents the sad figures of the cost of apartment rents. Legislators attend the annual meeting and say the “right” things about housing but never consider how they can reverse annual unwarranted excessive increases. Should our legislature come out of its befuddlement and pass HB 442, maybe here will be a chance Delaware can start to reclaim what was meant to be affordable domicile units.

If we go to the public utilities route by establishing a board to review all tenant rentals, we need to ignore the landlords’ bull about how much loot they are making. It is none of our business because affordable housing, by any other name, is essential to our economy and way of life. Do you think your landlord cares about that? Don’t they have to show their gross income for tax purposes? What are they hiding?

Pay the landlord a profit. It can be significant but not outrageous, based on the annual expenditure for operating expenses and maintenance.

Require that any housing/rentals built to be affordable with Fannie Mae, Freddie Mac or public money must be sold to an organization dedicated to affordable housing, such as NeighborGood Partners or the Martin Luther Foundation (Luther Village group), if the developer wants to sell.

You readers have a big stake in this because that increasing annual rent money leaving the state’s economy costs you money. Businesses won’t be forced to raise minimum wages. Single parents won’t have to work multiple jobs to keep roofs over their heads and can supervise their kids. Families can spend more in local businesses. Those are just a few benefits of what the HB 442 task force could launch.

Reader reactions, pro or con, are welcomed at civiltalk@iniusa.org .