Amid Mayor Muriel Bowser’s proposed reductions in spending on housing production – and a looming deadline to build 36,000 new units of housing across the city – Ward 1 Councilmember Brianne Nadeau unveiled a slate of proposals Tuesday designed to beef up the District’s ability to preserve existing affordable housing and develop under-utilized lots of land. 

Dubbed the Prioritizing Public Land Purchase Act of 2023, the bill would give D.C.’s Department of Housing and Community Development the broad authority to acquire land underneath multi-family rental buildings when the properties go up for sale, helping subsidize the cost of the acquisition for tenants hoping to collectively buy their building. 

The law would also give D.C. the right of first offer to buy many commercial and residential buildings for sale, including everything from office complexes to vacant and blighted homes.  Nadeau’s proposal does not regulate D.C.’s management of the properties it acquires or mandate a particular level of its involvement in redeveloping them, opening the door to a myriad of development structures. It could, for example, sell a parcel of land to an affordable housing developer, or help finance an office-to-condo conversion. 

“It feels to me like, over the years, even though we say we care about affordable housing, we’ve just been chipping away at the issue and working along the edges. One thing we can make a big difference on is the cost of land acquisition for tenants and ownership of public land, so we can actually produce more affordable housing,” Nadeau says. “In Ward 1, [an issue] for us is always infill – how do you find smaller pieces of land you can do things in? We’re almost finished with developing public land in Ward 1. There are a few huge projects [in progress] on U Street but not a lot more to do. It comes back to, how do you utilize resources that do exist?”

Nadeau’s proposals complement two existing laws, the Tenant Opportunity to Purchase Act and the District Opportunity to Purchase Act, which give renters and the D.C. government the opportunity to buy rental apartment buildings up for sale. 

But the high costs associated with acquiring and managing multifamily apartment buildings, particularly for the income-burdened households meant to benefit from the policies, means that TOPA has often proven more useful as a tool that allows tenants to negotiate buyouts or weigh in on who ultimately buys their building, rather than as a mechanism to prevent displacement. “More and more we see folks taking a buyout because it takes so much time to negotiate [a purchase],” Nadeau says. “Stakes are really high because of the cost of land.” City data indicates that D.C. processed nearly 1,400 TOPA notices in fiscal year 2022, financing eight projects through the Housing Preservation Fund.

Because Nadeau’s bill would effectively allow D.C. to split the cost of a building acquisition with tenants – and because land costs can account for up to half of property value – she hopes the price reduction would help facilitate more TOPA deals that result in tenants buying their apartment buildings. (While the D.C. government would continue to own the land purchased through these deals, it would enter into at least a 50-year ground lease with the building’s owner or developer. The bill does not identify a funding source for the land acquisition.)

Under the latter half of Nadeau’s proposal, the D.C. government would also be able to make an offer on TOPA-exempt properties that come on the market, like commercial buildings and single family homes – though it would only have a short window of just five days to do so. Sellers wouldn’t be obligated to accept the District’s offer, and as a sweetener, they wouldn’t have to pay the deed and recordation tax associated with building sales, which can run thousands of dollars for high-value homes. 

Yonah Freemark, the research director of the Urban Institute’s Land Use Lab, says he doesn’t believe there is another jurisdiction in the country with a similar policy on the books. “Across the U.S., one of the big challenges in making space for affordable housing has been the lack of publicly owned land. This proposal would provide some means to fill that gap,” Freemark told DCist/WAMU in an email about the proposal. Nadeau’s bill also comes as D.C.’s portfolio of developable land continues to dwindle.

It is also meant to breathe new life into the District Opportunity to Purchase Act, a law fully implemented in 2018 but that the city has still never exercised. Nadeau says she believes the D.C. government has the capacity to manage her vision for an expanded program. “And I’m hoping to have the buy-in,” she says. The five-day timeline is significantly shorter than the timeline applied to residents of a large apartment building trying to buy a building under TOPA; tenants have a month or more to register their interest in purchasing the building, then 120 days to enter into a contract. Critics of the policy have argued that this extended timeline makes building sales unreasonably burdensome by throttling the sale process.

Within one year of acquiring a new parcel of public land, the D.C. government would also face a legal requirement to exercise any zoning change required to build the maximum number of units allowed in any given area.

The bill echoes a proposal floated by Bowser in her budget support act that would allow the D.C. government to buy land underneath rental or owner-occupied housing, entering into a ground lease with the owner with the intent to secure its long-term affordability.

It comes as Bowser also proposed reducing funding for the Housing Production Trust Fund, D.C.’s main tool for building and preserving affordable housing. (Yesim Sayin Taylor,  executive director of local think tank D.C. Policy Center, told DCist/WAMU in March: “If our goal is to increase affordable housing, we may have to look for ways that are different from the Housing Production Trust Fund. It is very expensive to build new housing; preservation is much cheaper. And perhaps we’ll have to prioritize preservation.”)

After Nadeau formally introduces the bill, it will be referred to the Council’s housing committee, whose chairman At-Large Councilmember Robert White can decide whether to hold a hearing and markup.

“We need to be focused on what the next steps are for affordable housing in our community and housing preservation in our community. This gives us some tools to do that,” Nadeau says. I’m optimistic that with the new committee chair moving forward proposals, this is going to be viable in a thoughtful way to approach housing needs in the city.”