CEO Blog: ‘Univerally-Mandated’ Universal Design?

Recently I was invited to the state capitol by area legislators to testify before a house committee in Jefferson City about a proposal (House Bill 1737) that would require all new state-supported affordable housing in Missouri to meet Universal Design standards. The legislation is being advanced by well-intentioned advocates for people with disabilities to help meet the special accomodations that often become necessary in their housing options.

For those who may not know, Universal Design and its accompanying market opportunities are one of the few bright points in the residential construction industry right now.  Of all the professional designations offered by the National Association of Home Builders, the Certified Aging in Place Specialists, or CAPS – which is based on the principles of Universal Design) is the second fastest growing designation program in the country – just behind the certified green professional designation. Between 2005 and 2009, the number of people taking CAPS designation classes more than doubled. Thousands of builders are ahead of demand on this, even building the future of their businesses around it.

One example of where Universal Design is being incorporated voluntarily with great success is Sustainable Housing Solutions in Springfield. This HBA member specializes in construction of new affordable housing – housing made possible in part by state tax credits. I wanted to know what owner Debra Shantz-Hart though about HB 1737, as it could directly affect her company’s work.

Here is what Debra said: “We think that all projects should be evaluated on a case by case basis—-for example, we are doing a version of universal design on our upcoming senior housing project.  We have planned and budgeted for it but there were trade-offs in our design in order to bring the project in at affordable level.”

Debra reminded me what should be that the most important characteristic of affordable housing: that it remain affordable. While Universal Design serves an important purpose, it also adds a significant cost to construction projects. This bill’s requirements could add anywhere from 5% to 10% to the hard costs of a typical affordable housing construction project.

Of course, the entire reason the state is involved in affordable housing at all is that, in the normal course of the marketplace, there are some of our citizens who simply would not be able to afford to buy or rent a home otherwise. So, the state offers incentives and tax credits to get housing built that these citizens can, with help, afford to live in.

Well-intentioned requirements like HBA 1737 one jeopardize good affordable housing developments by causing the project not to “pencil out.”  And that has potential consequences for the broader economy. On average, 100 single family homes built equates to 284 fulltime local jobs. The ripple effect of these jobs and the construction activity is felt by our state’s economy, as well as by local economies. Government revenues are up when construction is strong; and they are down when construction is weak.

Affordable housing construction is a big part of the overall picture. In Greene County, one affordable housing single family project (Fulbright Springs) constituted 14% of all the single-family new homes permitted in 2009.

Mandating that all of these units should be built using Universal Design would undermine the whole reason the state assists in getting these affordable units built in the first place. The increased cost would lead to one of only three possible outcomes: 1) these affordable housing units wouldn’t get built; 2) they get built, but go unsold or unrented; or 3) the state steps in to increase its subsidy for affordable housing.

None of these are attractive options when there are much more productive ways of ensuring that adequate Universal Design housing is available, even in affordable housing developments.

Universal Design can be incorporated more efficiently through incentives than through mandates. For example, projects using Universal Design could be given priority in the selection process.  Or, builders who set aside a portion of their development as Universally Designed units could be rewarded with greater densities or more total units. These incentives would increase the availability of Universal Design projects without undermining the fundamental purpose of affordable housing: that it be affordable. They also would not require additional subsidy dollars the state doesn’t have, just to make up for what would be its own self-inflicted affordability gap.

While incentives like these or others would be helpful; I am not certain that even they are really necessary. The industry already is enthusiastically and voluntarily responding to what it believes is a growing and important niche within residential construction in Universal Design. This might be one of those instances where government shouldn’t do for the people what the people seem prepared to do better for themselves.

Following my testimony, I was encouraged to receive positive feedback from the legislators who sit on the committee that is hearing the bill. I believe the HBA’s case was well-received and had an important positive effect on the proceedings. As often is the case, the HBA brought the only testimony against the bill in its current form (many more testified in favor). If not for the work of the HBA, legislators would have heard no counterpoint to this proposal. And that could lead to some very bad decisions now and in the future.

And, lest you think this is only an isolated piece of legislation that has little to do with your business, consider this: while this particular bill applies only to subsidized housing, advocates at the hearing made no secret of their ultimate goal of requiring ALL new housing to be built to Universal Design standards. They see this bill only as the first step toward the ultimate goal of “universally-mandated” Universal Design.

So, the HBA will continue to work toward cooler heads prevailing. Our goal remains common-sense solutions that won’t needlessly damage the market for new homes. At its core, that is the purpose of an association like ours: strength in numbers. The HBA’s testimony is given weight only because of your membership in it. And, in turn, as a member, you receive benefit from the successful advocacy of the association. Put even better by Benjamin Franklin in the early days of the American Revolution: “We must hang together or we shall surely hang separately!”

Matt Morrow
Chief Executive Officer
Home Builders Association of Greater Springfield