Developer subsidies, buy‑back guarantees and priority permitting: presenter outlines strategies to scale affordable housing

Joseph Dukes, founder and chief of Palmetto Community Developers, told the committee that scaling affordable housing requires municipal creativity to change the financial math for developers.

Dukes described a Florence project in which the city banked land and offered a $250,000 developer subsidy that helped produce roughly 10 homes. The city also agreed to a one‑year buy‑back guarantee for unsold units, which Dukes said gave lenders and developers confidence that the project would not fail and helped the loan committee approve financing.

“You have to give the developers a reason to consider doing affordable housing,” Dukes said, describing incentives such as front‑of‑the‑line permitting and city‑provided subsidies to improve debt‑coverage ratios for projects that otherwise "don't pencil." He emphasized that infrastructure — water and sewer availability — is frequently the decisive barrier in rural and exurban locations.

Dukes also explained his firm's approach to working with land‑rich, cash‑poor families: technical assistance, predevelopment planning, and referrals to lenders and CDFIs so owners can preserve land while generating revenue. He urged covenants and design controls to retain affordability over time and encouraged municipalities to think in terms of public‑private partnerships.

The presentation was followed by council and public questions about the Florence example, infrastructure costs and how municipal guarantees or subsidies are structured. Dukes said his company can tailor services — from technical assistance and underwriting to full development support — based on what a municipality requests.

Committee members thanked Dukes for practical examples and noted the difficulty of making affordable housing work without public incentives and upfront public capital.