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Triple Bottom Line Redistribution in Mixed-Income Housing Through Transition Spaces

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Though the LIHTC promote the presence of sustainability features, they are extremely time consuming, expensive, and competitive to win. Developers tend to build green to increase their chances of winning the tax credits, often overlooking the full potential of the LIHTC. Though scholars and urban planners agree that mixed-income housing benefits people from lower incomes through proximal role-modelling and promotion of tolerance, case-studies show limited economic integration of the middle-income tenants and the poor. Transition spaces are spaces that need community interaction and issues of safety can be addressed through their design. There is a huge opportunity here as developers are willing to implement any positive design change that benefits the community and existing LIHTC talk vaguely about transition spaces and credits are given for improved health and economic growth but how it can be achieved through design is not specified. This research proposes a new model that takes a soon to be developed mixed-income housing development and proposes various design interventions to be implemented in the transition spaces of the housing, by equally distributing strategies for environmental, social, and economic growth thereby increasing their chances of winning the LIHTC that will create an equitable model for social justice.
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PLEA SANTIAGO 2022
Will Ci ti es S ur vive?
Triple Bottom Line Redistribution in Mixed-Income Housing
Through Transition Spaces
AFSHAN REHMAN ¹
¹ Carnegie Mellon University
ABSTRACT: Though the LIHTC promote the presence of sustainability features, they are extremely time
consuming, expensive, and competitive to win. Developers tend to build green to increase their chances of
winning the tax credits, often overlooking the full potential of the LIHTC. Though scholars and urban planners
agree that mixed-income housing benefits people from lower incomes through proximal role-modelling and
promotion of tolerance, case-studies show limited economic integration of the middle-income tenants and the
poor. Transition spaces are spaces that need community interaction and issues of safety can be addressed
through their design. There is a huge opportunity here as developers are willing to implement any positive design
change that benefits the community and existing LIHTC talk vaguely about transition spaces and credits are
given for improved health and economic growth but how it can be achieved through design is not specified. This
research proposes a new model that takes a soon to be developed mixed-income housing development and
proposes various design interventions to be implemented in the transition spaces of the housing, by equally
distributing strategies for environmental, social, and economic growth thereby increasing their chances of
winning the LIHTC that will create an equitable model for social justice.
KEYWORDS: LIHTC, 3BL, mixed-income housing, affordable housing, sustainability
1. INTRODUCTION
Using sustainability as a factor to increase the
price of real estate has been used to gain
competitive advantage and for developers to
improve their portfolio. Though the inclusion of
sustainability creates long term value generation
and causes short term increase in profits, it is
feeding into the corporate system of where only the
rich can afford to be sustainable. The Return on
Investment (ROI) for green rated buildings is a
minimum of 14% but the rent increases by 13.8%
for a LEED or an ENERGY STAR building when
compared to a non-certified building in the same
metropolitan area (Fuerst. et al, 2011). As of 2013,
44 million Americans were burdened by the cost of
housing (Metcalf. et al, 2018) and there is a great
need to combat escalating rent for good quality
affordable housing in the US.
This problem of unaffordable housing and
increase in premium of green rated houses is
making sustainability inaccessible to the poor.
Higher construction costs and formation of new
trends related to green features cannot be afforded
by the poor. The original intention of sustainable
development is to foster equal growth and eco-
technologies should not hinder social equity. The
term ‘sustainable housing’ becomes inappropriate if
it becomes inaccessible to the lower income public.
This issue is being addressed by the Low-Income
Housing Tax Credits (LIHTC). The federal
government issues tax credits to the state
government and state housing agencies awards
credits to developers of affordable housing. The
current budget in 9.5 billion dollars per annum and
under Biden’s administration this is going to
increase to 64 billion dollars with extra emphasis on
safety, health, and energy efficiency.
Though there are many models proposed for
mixed-income development, there are negative
social and spatial consequences due to
unwillingness to share space and vertical capitalism
(Darcy. et al, 2010). The current model will be
unpacked to overlap social justice with the real
estate development model through a tool that
helps architects and developers analyse different
sustainability credits available in the LIHTC and
select additional design interventions to equally
distribute credits in 3 different focuses of
environment, equity, and economy. This research
presents a hypothesis that this gap can be
addressed through the transition spaces of the
housing unit. Sustainability used as a different social
housing model will reduce class segregation and
create an equitable model for the urban space. By
creating and analysing this model, developers can
promote the value of human health, economic
growth, and socialization.
2. METHODOLOGY
To propose a solution to combat inequality in
mixed-income housing through sustainability, the
process is divided into 2 stages pre-design and
design. The pre-design stage involves
contextualizing the research by identifying the
LIHTC in Pennsylvania, doing case-studies of existing
mixed-income housing units in Pittsburgh, breaking
down the existing sustainability rating systems and
interviewing the stakeholders involved in affordable
housing. The design stage involves developing the
design taxonomies based on the stakeholder
interviews and developing the final toolkit.
2.1 LIHTC in Pennsylvania
The research is contextualized by studying the
LIHTC in Pennsylvania (PA). The current annual state
cap is 10 million dollars per year (Novoco, 2021) for
PA which is calculated based on population
(population x $1.755). The qualified allocation plan
(QAP) for Pennsylvania includes 6 sustainability
rating systems such as National Green Building
Standard, DOE Zero Energy Ready, Enterprise Green
Communities, LEED Homes, LEED BD+C (New
Construction) and Passive House. The states that
are similar to Pennsylvania in terms of sustainability
rating systems are Illinois and Virgina (Novoco,
2021). There are also several states in the United
States that do not have any LIHTC program enacted
yet.
2.2 Case Studies
Figure 1:
Images from Cornerstone project case study.
The Cornerstone Project at East Liberty (Tai +
Lee Architects, 2021) was designed by Architect
Yoko Tai from Tai + Lee Architects and was
developed by McCormack Baron Salazar.
The Sandstone Quarry project at Fineview was
designed and developed by Trek Development (Trek
Development Group, 2021) and was earlier a site to
the Old Allegheny Dwellings.
Figure 2:
Images from Sandstone Quarry case study.
2.3 Break-down of Sustainability Rating System
A previous research by Kasper Guldager Jensen
and Harpa Birgisdottir breaks down the content of
different sustainability rating systems used across
the world into 3 focuses environmental,
economic, and social aspects (Jensen et. al, 2019).
The break down shows that the focuses in all the
rating systems are not equally distributed.
The same concept was used to divide the credits
under the 6 sustainability rating systems in the
Pennsylvania Qualified Allocated Plan (QAP). Ony
credits related to transition spaces were marked.
The LIHTC has compulsory thresholds (Novoco,
2021). The thresholds related to transition spaces
were marked and divided into 3 focuses. It is
observed that the break-down for the LIHTC and the
6 sustainability rating systems under each focus is
not equally divided. The LIHTC thresholds mostly
focus on social credits and passive house
certification only talks about the environment. The
focus on economic growth is very limited in all the
rating systems.
2.4 Stakeholder
To propose the design interventions the design
had to be ground to reality. For this it was
important to know what the stakeholders think
about the gaps present and how it can be resolved.
To understand who should be interviewed, a
stakeholder diagram was mapped out. The
stakeholders that have the most influence are the
architects, developers, and market rate tenants.
The value of a well-structured and well-designed
mixed-income housing can be reaped by tenants
living at subsidized rate, developers and in the long
run, the entire community.
2.5 Interview
The first interview was with an architect, Yoko
Tai (Tai + Lee Architects, 2021). Her expertise lies in
mixed-income housing. Yoko has been working
primarily with a private, not for profit developer
McCormack Baron Salazer and from her personal
experience felt that the developer cared a lot about
sustainability and social justice. Their designs for
mixed-income housing always include colourful and
grand lobbies, and utmost care is taken to design
the staircases, roof decks and patios. Her project at
East Liberty called Cornerstone is tactically designed
for sunlight, visibility, and safety.
The second step was to interview both a non-
profit and a private developer. Linda Metropolus
runs a non-profit called Metropolus Development
(Metropolus Org., 2021). In her work experience
she always concentrated on making the mixed or
low-income housing healthier, quieter and more
thermally comfortable. 2 of her projects have
community rooms that doubled up as an art space
and a computer room. Though these spaces were
used a lot by the lower income group, it was noted
that there was a lack of interaction between
communities of different income groups.
The third interview was with a private developer,
Bill Gatti from Trek Development (Trek
Development Group, 2021) who hired a director of
mission culture and people to overlook all the
housing projects. They concentrate on strategically
designing spaces for safety by using a lot of glass
and windows. They make sure to add luxurious
amenities to attract the market rate tenants to use
these spaces. They also confirmed that transition
spaces are not susceptible to get value engineered
and they would rather cut down their budget by
changing external cladding, HVAC system, light
fixtures, etc.
The last stakeholder interview was with an
architectural coordinator who worked with
McCormack Baron Salazer (McCormack Baron
Salazer, 2021) for years. He talks about the
importance of visual connection to outdoor spaces
for self-policing and agrees that interaction spaces
need more attention.
Figure 3:
Word Cloud of words associated with Transition Spaces.
Note: From these interviews, a word cloud of design
aspects that the stakeholders felt were related to or
important to transition spaces was developed. Some of
the words include well-lit, safe, grand. The transition
spaces addressed would be staircase, corridor, courtyard,
lift lobby, outdoor deck, foyer, and entrance.
2.6 Developing the taxonomies
In the penultimate step, taxonomies were
developed for transition spaces and were
categorized into 3 focuses environment, social
justice, and economy. 3 other focuses were
developed that lied at the intersection of the
previously mentioned 3 focuses.
Figure 4:
Environmental Taxonomies.
Some of the environmental taxonomies include
having access to views, having access to nature,
improving indoor air quality, using materials for
thermal and acoustical comfort, etc. The
taxonomies that have an overlap between
environmental and social are places where
residents are allowed to interact with each other
and with nature.
Social taxonomies address issues of safety and
inclusivity. Issues of safety are tackled with visibility
and universal design elements are recommended
for inclusivity.
Figure 5:
Social Taxonomies.
To show influence on economic growth through
design; shared kitchen, urban farming, and flexible
spaces to promote home businesses are proposed.
Figure 6:
Economical Taxonomies.
2.7 Creating the tool
To build the final toolkit, the users were first
identified. They were architects, developers, and
sustainability consultants. The next step was to
decide the platform on which the tool will be built.
The 3 options were a standalone app, Microsoft
excel and a website. Despite having a boring user
interface, Microsoft Excel (The Microsoft
Corporation, 1985) was identified as the best option
as it is used by everybody in the industry and has no
learning curve.
The idea was to develop a toolkit that does 2
things it helps architects of a soon to be
developed mixed-income housing unit design
transition spaces that negate social and spatial
disparities. It will also help the developers propose
various design interventions to be implemented in
the transition spaces of the housing, by equally
distributing strategies for environmental, social, and
economic growth thereby increasing their chances
of winning the LIHTC. It has 2 parts analysing the
existing green rating systems and understanding the
gap and the second part is to fill the gap with design
suggestions.
3. RESULTS
3.1 Tool-Kit
The final toolkit developed on Microsoft Excel
(The Microsoft Corporation, 1985) currently works
only for Pennsylvania, LIHTC and for newly
constructed low-income housing units. It is an 8-
step process and helps the user analyse different
options available to evenly distribute the triple
bottom line in the affordable housing unit.
In Step-1 the user must select the state that they
are constructing the affordable housing in.
In Step-2 the user must select the sustainability
rating system they are opting for in order to
increase their chances of winning the tax credits.
The credits for the selected sustainability rating
system related to transition spaces populate the
screen and when the user clicks on each credit, a
pop-up window opens that shows the detailed
requirements of each credit. Each credit is pre-
classified as one focus, either environment, social or
economy.
Figure 7:
Step-1, Step-2 and Step-3.
In Step-3 the user must double click on the
credit that they want to opt for in their final design.
Based on the number of credits selected in Step-
3 and the category of focus it belongs to, the break-
up is shown in Step-4 which also includes the LIHTC
thresholds.
In Step-5 the user can select up to 5 taxonomies
in the environmental category. The drop-down
menu shows different options available for design
interventions and the taxonomy image changes
accordingly. Like Step-3, the user can double click
which credit they are opting for.
In Step-6 the user can select up to 5 taxonomies
in the social category. The drop-down menu shows
different options available for design interventions
and the taxonomy image changes accordingly and
the user can double click their preferred design
intervention.
Figure 8:
Step-6.
In Step-7 the user can select up to 5 taxonomies
in the economy category. The user can double click
their preferred design intervention.
In the final step, the user can see the updated
percentage break down of the triple bottom line
that includes existing LIHTC thresholds, selected
sustainability rating system and selected proposed
new design interventions for the mixed-income
housing unit. For better visualization there is a
before and after graph. If the user is not satisfied
with the break-up, they are allowed to go back and
update their selection by selecting or unselecting a
certain taxonomy.
Figure 9:
Step-8.
3.2 Implementation on a case-study
Below are some examples of how the design
suggestions or taxonomies are superimposed on an
existing site of an already constructed mixed-
income house. It shows that the design
interventions can be done without much change to
the architectural layout. Some examples are - Views
from windows should have access to nature, water
features can be added wherever possible and
community areas should be illuminated at night for
safety.
Figure 10:
Execution on a case study.
Detectable flooring for the visually impaired,
flexible spaces to promote home businesses,
encouraging tenants to avoid excessive use of
energy and water and space for composting waste
are some examples in the economical taxonomy
category.
4. CONCLUSION
To reiterate why this tool is important, it creates
an awareness of all the options that are available to
evenly distribute the triple bottom line by designing
for wellness, resilience, and community integration.
By analysing the options that are available one can
not only increase their chances of winning the LIHTC
but also understand the actual potential of its
intent.
Figure 11:
Importance of the tool.
ACKNOWLEDGEMENTS
This section, if included, appears right after the
main body of the text and is headed
“Acknowledgments.” This section includes
acknowledgments of help received from associates
and colleagues, credits to sponsoring agencies,
financial support, and permission to publish. This
template has been updated from PLEA 2020
Conference.
REFERENCES
1. Darcy, M. (2010). De‐concentration of
disadvantage and mixed income housing: a critical
discourse approach. Housing, theory and society, 27(1), 1-
22.
2. Fuerst, F., & McAllister, P. (2011). The impact
of Energy Performance Certificates on the rental and
capital values of commercial property assets. Energy
policy, 39(10), 6608-6614.
3. McCormack Baron Salazer (2021).
https://www.mccormackbaron.com/
4. Metcalf, G. (2018). Sand castles before the
tide? Affordable housing in expensive cities. Journal of
Economic Perspectives, 32(1), 59-80.
5. Metropolus Organization (2021).
https://www.metroplus.org/
6. Microsoft Excel, Microsoft 365 (1985). The
Microsoft Corporation. https://www.microsoft.com/en-
us/microsoft-365/excel
7. Novoco (2021). Affordable Housing Resource
center. https://www.novoco.com/resource-
centers/affordable-housing-tax-credits/lihtc-
basics/about-lihtc
8. Tai + Lee Architects (2021).
https://taipluslee.com/
9. Trek Development Group (2021).
https://www.trekdevelopment.com/
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G., Jensen, K. K., & Birgisdottir, H. (2019, February).
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