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Council revises affordable-housing proceeds policy to prioritize HOME match
Summary
Council declined to adopt the full Special Revenue Fund policy as drafted and instead approved a revision directing proceeds from municipal land sales/leases (when designated by resolution) to be used as the city's contribution for HOME matches; council asked staff to return with clarified language.
After extended debate about sustainability and oversight, Statesville City Council voted to revise the proposed Affordable Housing Special Revenue Fund (SRF) policy so that proceeds from specified land sales or leases would be allocated to the city's HOME-match contribution unless and until the council directs otherwise.
Mr. Pierce presented the SRF policy and explained primary allowable uses: production of affordable housing, rehabilitation, and down-payment assistance; he also described proposed administrative controls including application matrices, reporting and monthly financial updates. The policy language allowed the council to decide case-by-case which sales or leases would be placed into the fund.
Multiple council members expressed concern that the SRF, as drafted, could become a recurring budget line or shift long-term obligations to the general fund. One council member warned that without limits the fund could become "a line item budget that will go on forever." Another said the policy lacked measurable deadlines and oversight tied to defined benchmarks.
Rather than adopting the full policy as written, councilmembers Amy and David offered an amendment (later approved) to revise the policy so that proceeds identified by council resolution from municipal land sales or leases would be dedicated to the city's 25% HOME match. The revised direction passed after discussion; staff was instructed to redraft the policy language and return it to council for final approval.
Why it matters: the SRF is intended to create a dedicated vehicle to fund affordable housing uses and to provide a transparent process for handling proceeds from city property sales; tying proceeds to the HOME match was intended to protect programmatic alignment and address council concerns about accountability.
Next steps: city staff and the city attorney will revise the SRF policy language to incorporate the council's direction and bring the updated draft back to council for a subsequent vote.
Quote: "If the home fund is something we want to go to, it will go to that," a council member said during the debate.
