Community Dividend

Ninth District community developers use green innovations to help make housing affordable

For affordable housing developers, the goal of "going green" is not only to provide permanent shelter and community stabilization at a lower cost, but to provide low-income families with long-term reductions in overall living expenses.

Deborah Booth Summers - Freelance Writer

Published October 1, 2010  |  October 2010 issue

Low-income families have long struggled to balance the costs of shelter, food, health care, and utilities. An emerging green movement in affordable housing aims to make the balance easier to achieve.

In the context of building and home design, "green" commonly refers to practices that conserve natural resources in the short and long term, improve the quality and longevity of structures, and promote the health and well-being of occupants. Affordable housing developments are incorporating green features like Energy Star appliances and straw bale insulation that reduce utility bills; air quality improvements that reduce health care expenses; and community and personal gardens that provide local, organic produce at little cost. For affordable housing developers, the goal of "going green" is not only to provide permanent shelter and community stabilization at a lower cost, but to provide low-income families with long-term reductions in overall living expenses.

Research confirms savings

A 2005 study conducted by New Ecology, Inc., in Cambridge, Mass., and the Tellus Institute in Boston, confirms there are long-term cost reductions for residents of green affordable housing.* The study analyzed actual and projected costs of 16 green affordable housing developments across the country. The analysis revealed that the average financial benefit to residents, in terms of utility costs over the life cycles of the developments, would be $12,637 per housing unit. In addition, the green buildings provide benefits to residents that the study did not quantify, such as improved health and quality of life.

One criticism of green building is that innovative technologies such as solar water heaters often cost more to purchase and install than standard systems. The higher costs add up to a "green premium" that can make green construction more expensive up-front than conventional construction. As the New Ecology study notes, the green premium can be a barrier to affordable housing development, since affordable housing funders prefer to allocate dollars to the projects that have the lowest initial costs. The study reveals that, on average, the 16 projects cost 2.4 percent more to build than conventional affordable housing. However, on average, the developers and owners would see per-unit savings of $2,725 in operation and replacement costs over the life of the property. For the majority of the 16 projects, the long-term savings would equal or outweigh the green premium. The findings suggest that green building can be a cost-effective way for affordable housing developers to pursue their mission of helping low- and moderate-income families.

Green projects in the spotlight

Many Ninth District community development organizations also see long-term benefits to building green. The three organizations spotlighted below—homeWORD in Montana, Home Matters in Minnesota, and SAFE Homes in North and South Dakota—offer models for incorporating green, cost-saving features into affordable housing.

HomeWORD bound

In Billings and Missoula, Mont., homeWORD emphasized environmentally friendly features in affordable housing long before "green" was a national buzzword. HomeWORD was established in 1994 to address rapidly increasing housing prices and stagnant wages in Montana's two largest cities. It aimed to provide affordable housing and instill other positive changes in the lives of low-income families. HomeWORD plans to have a total of more than 220 developed units by 2011, and its Home Ownership Centers in Missoula and Billings have offered guidance and advice to more than 4,000 households and helped 700 families purchase homes since 1997.

Though homeWORD's homebuyer education programs and financial assistance partnerships with local foundations provide essential aid to Montana's poorest residents, innovation in sustainable, affordable housing is the organization's hallmark. "Sustainable," in this context, refers to practices that can be maintained over the long term without causing a net depletion of resources.

"We've strived to be innovative in each of our ten projects," says Andrea Davis, long-time Montana resident and executive director of homeWORD. "For instance, we helped introduce the state to straw bale housing and land trusts."

HomeWORD's green practices have earned the organization local and national awards, such as the 2006 Home Depot Foundation Award of Excellence for Affordable Housing Built Responsibly in Rental Housing and the 2007 Sonoran Institute's Best of the Northern Rockies Award.

"We attribute our successes to our many partnerships with local and regional organizations," says Davis. "And of course, our community members. Some of our best ideas have come through our charrette process, where community members help design our projects."

One of homeWORD's projects involves community-based agriculture. Orchard Gardens, a 35-unit affordable housing development located on the outskirts of Missoula, features Energy Star appliances, dual-flush toilets, and on-demand water heaters to reduce utility costs. The development also includes orchards, a bike trail, covered bike parking, and a community farm. A local organization called Garden City Harvest runs the farm and sells the produce to local families.  Through this partnership, homeWORD provides families with affordable rental housing and Garden City Harvest provides local, organic fruits and vegetables to low- and moderate-income families in Missoula.

HomeWORD considers the initial investment in more energy-efficient materials and appliances a necessity for reducing costs in its multifamily complexes. These materials reduce maintenance and operating costs for homeWORD and translate into lower rent payments for tenants.

Green building efforts in and around Missoula are highlighted in homeWORD's Summer Sustainability Tours for contractors, developers, renters, and homeowners. HomeWORD advocates for the incorporation of sustainable, green building concepts into housing grant and loan policies and programs at the state level and works across state lines to promote green building through the Rural Collaborative.

According to Davis, homeWORD approaches affordable housing holistically. "We believe that we cannot build for the future by destroying the environment," she says. More than just a space in which to live, homeWORD's projects create a palpable sense of place for tenants. "People are proud to live in our communities. The beauty of where you live translates into many parts of your life."

Home Matters matters

Home Matters began as a partnership dedicated to modeling best practices in energy-efficient, affordable housing in southeast Minnesota. Three Rivers Community Action, Northfield Housing and Redevelopment Authority, RENew Northfield, Blue Cross and Blue Shield of Minnesota Foundation, and Greater Minnesota Housing Fund quickly realized that changes in the housing market offered another opportunity for the partnership: neighborhood stabilization.

"Our initial concept was to demonstrate how to create healthy, green, and affordable housing in a neighborhood of Northfield. The unfortunate rise in foreclosure rates allowed us to contribute to stabilizing neighborhoods around the area," says Jenny Larson, community development director of Three Rivers Community Action.

Home Matters uses funding from partners to renovate foreclosed homes and incorporate affordability and green features into otherwise unloved properties. At a model home at 311 Cherry Street in Northfield, the partnership's outreach arm offers tours, seminars, demonstrations, and other events to educate the community on healthy and green renovation. To date, more than 300 people have attended events at the model home. The Home Matters blog at www.home-matters.org features articles and updates about green construction, indoor air quality, and local events on sustainability and affordable housing.

Gap financing, down payment assistance, homebuyer education, and assistance from funding partners including the Greater Minnesota Housing Fund, the Federal Home Loan Bank of Des Moines, Minnesota Housing, and Northfield Housing and Redevelopment Authority help people with incomes below 80 percent of the statewide median become homebuyers. But one ongoing challenge is that while partner organizations and state programs provide financing options to assist buyers with the upfront costs of purchasing a home, the buyers may end up struggling with monthly utility bills, especially in cold winters.

According to Larson, by balancing the purchase costs with the long-term operating costs and benefits, Home Matters enables families to continue to prosper while owning a home. That, in turn, helps stabilize neighborhoods.

"There is always a balance between up-front cost and long-term health benefits and energy savings in selecting improvements for the renovations," she says. "We determine a budget for every renovation and make decisions within that budget that address our priorities of health, safety, energy efficiency, and stabilization."

Innovative and cost-saving technologies in Home Matters' properties include solar water heaters, an air-source heat pump, Energy Star appliances and SolaTube lighting, and upgraded insulation. Green features that are not necessarily cost-saving but contribute to community goals of being more environmentally friendly include cabinets built of lyptus—an easily replenished hardwood product made from eucalyptus trees—and a kitchen floor made of marmoleum, a natural material made from linseed that resembles linoleum. Home Matters also focuses on reducing allergens to improve air quality and lower health care costs for homeowners.

"Not all remodels will have all of these features, but all our new homeowners will experience much lower operating costs than your average home. We're preventing empty homes from turning into blighted neighborhoods, and we're turning households into homeowners," says Larson.

Other community organizations are beginning to follow suit. First Homes, an organization in Rochester, Minn., dedicated to affordable housing for first-time buyers, has begun using Home Matters as a model in its purchase of foreclosed properties in downtown Rochester. Out of nine purchased properties, First Homes has renovated seven and sold one. Through Home Matters, Three Rivers Community Action plans to purchase and renovate ten homes in Northfield and twenty additional homes throughout southeastern Minnesota in 2010 and 2011.

Straw bales and SAFE Homes

For tribes in South Dakota, North Dakota, Wyoming, Nebraska, and Iowa, green construction not only builds affordable housing—it builds communities that respect local resources.

In 1994, Native Americans from 15 tribes in the Northern Great Plains formed the Intertribal Council On Utility Policy (COUP) to address utility- and telecommunications-related issues and their role in achieving the goal of more resilient communities. In 2003, working with Greenweaver, Inc., One World Design, and the Development Center for Appropriate Technology, the Intertribal COUP formed Sustainable Affordable and Efficient (SAFE) Homes and its Train-the-Trainers program.

SAFE Homes helps the Intertribal COUP participating tribes address rising energy costs and unemployment. The Northern Plains region experiences a 150-degree annual temperature range; thus, energy needs and expenses for homes are great. The high unemployment rate on many reservations also poses a formidable challenge to the Intertribal COUP's goal of building prosperous communities through sustainable housing.

SAFE's Train-the-Trainers program provides experts on sustainable housing technologies to train the instructors at tribal colleges' building-trades programs. The program focuses on straw bale construction, a building method in which modular, high-density bales of straw are used to form the walls of a structure. The walls are then plastered or stuccoed to create a sealed, smooth finish. The Train-the-Trainers classes cover all aspects of straw bale construction, from blueprint analysis to hands-on building. Students even construct entire homes and in 2009 provided the campus of Sinte Gleska University in Mission, S.D., with a new Buffalo Management Program house.

"It makes sense to have the college's buffalo management program, which tries to bring the buffalo back in a sustainable way, to be housed in a sustainable way with local clays and local resources," says Bob Gough, secretary of the Intertribal COUP. "The building reflects the local environment and local values and puts housing back into the hands of the community."

Straw bales are an abundant local resource in the Northern Plains and are one of the most efficient and inexpensive forms of insulation available. Overall, the up-front costs of straw bale construction are similar to those of conventional construction, yet the potential for long-term energy, health, and environmental savings is immense. By using a locally sourced material that keeps long-term costs down, the Intertribal COUP hopes to prevent the transfer of local wealth from reservation communities.

"Straw bale houses aren't just affordable in up-front costs—they can save 70 to 75 percent in energy costs. This keeps money in local people's pockets from month to month," says Gough.

Federal housing programs administered through the U.S. Department of Housing and Urban Development and U.S. Department of Agriculture support and fund straw bale housing. SAFE Homes funding partners also include the U.S. Department of the Interior's Office of Indian Energy and Economic Development, the South Dakota Community Foundation, and the Untours Foundation.

According to Gough, "The government allocates a little over a million dollars per tribe per year for housing, and we're looking at using local resources to keep dollars and jobs in the local community." He adds, "Everyone on the Rosebud reservation appreciates that we're not just coming to build a house and leaving, but we put skills and knowledge in the hands of local teachers who will be there long after we leave."

Fulfillment through innovation

As the organizations profiled here demonstrate, green innovations in affordable housing are gaining a foothold in the Ninth District. HomeWORD's award-winning efforts in Montana illustrate ways to bring green technologies and creative land use to affordable rental housing. Home Matters in southeast Minnesota combines creative financing and public education with sustainable technologies to enrich the lives of not only new low-income homeowners, but the community at large. The Intertribal COUP's SAFE Homes Train-the-Trainers straw bale construction program brings income and revenue to tribal communities and skilled jobs to tribal college and university students.

From solar water heaters to straw bale walls, community development organizations are using technology and energy-efficient materials to fulfill their dedication to long-term housing cost reduction, neighborhood stabilization, expanded work opportunities, and healthy living. Green housing may present more up-front costs for community development professionals and builders, but the long-term savings can help them more than recoup those costs while providing low-income families with affordable places to call home.

Deborah Booth Summers is a freelance writer who lives in Rochester, Minn. She recently earned a master's degree in communication studies from the University of Minnesota.

Sources: New Ecology, Inc., and the Tellus Institute, 2009; The Costs and Benefits of Green Affordable Housing, published by New Ecology, Inc., and The Green CDCs Initiative, 2005.


* William Bradshaw, Edward F. Connelly, Madeline Fraser Cook, James Goldstein, and Justin Pauly, The Costs and Benefits of Green Affordable Housing, New Ecology and The Green CDCs Initiative, 2005.

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