Wilmington debate centers on $20M neighborhood stabilization plan and how $16.8M for affordable housing will be spent

Chair Michelle Harley convened the Wilmington City finance committee on April 27 to question the administration’s plan to move $20 million from the tax stabilization reserve toward neighborhood stabilization projects, including a $16.8 million tranche intended to increase the supply of affordable housing.

Director of Real Estate and Housing Bob Weir told council the administration expects the $16.8 million to support a mix of large developments and small infill projects and that the city will not itself build housing but will instead offer land access, predevelopment grants, infrastructure work and fee caps for developers. “We are looking at…over 200 units,” Weir said, estimating a per-unit subsidy averaging “under a $100,000,” with some subsides lower and some higher depending on income targets.

Council members pressed for far more specificity. Councilmember Darby and others asked how many rental and homeownership units the funds would produce and for how long units would remain affordable. “We need to define affordability,” Vice Chair Bracey said, urging the council to spell out minimum affordability periods and carve-outs for the lowest-income households. Multiple members proposed minimum affordability terms of 10–15 years rather than a five-year baseline.

Weir said the length of an affordability requirement will be tied to the level of subsidy and that mortgage-and-lien provisions will be used to hold recipients accountable. “These funds would be secured by a mortgage and note on the properties,” he said. He added that the department will apply a developer-fee cap and run a needs-based review during application scoring.

Several council members also asked how the administration planned to divide funds between “small” and “large” projects: the administration defines small projects as nine units or fewer and large projects as more than nine. Weir said many of the infill and lot-based efforts should be handled by small local or minority contractors supported with predevelopment assistance and fast‑track permits, while larger non‑profit developers would be expected to leverage low-income housing tax credits and other subsidies.

On oversight, council members referenced prior concerns about land‑banked or subsidized units being sold above stated affordability levels. Councilmember Owens asked what recourse the city would have “to recoup our dollars if they’re not being used for what they are intended for.” Weir and legal staff said remedies include recorded liens and legal enforcement when an owner breaches an affordability covenant, but acknowledged that enforcement can become protracted and may require litigation.

The hearing also explored alternatives to drawing down the tax stabilization reserve, including financing through capital/bond issuances. Administration staff warned that bond funding would increase total costs (interest) and could delay projects because the capital budget is set on a multi‑year schedule; the administration said the tax stabilization reserve currently exceeds minimum policy levels but cautioned against repeatedly using the reserve to close recurring budget gaps.

Councilmembers and the administration agreed to continue discussion in a follow-up session focused exclusively on the design, subsidy formulas and accountability mechanisms for the $16.8 million. The chair said additional budget follow-ups and a public presentation of draft subsidy criteria will be scheduled before a final vote.