STATE OF THE ISLAND: Building Homes, Strengthening Families

Hafa Adai!
 A lot of information was researched in order to produce the Governor’s State of the Island Address.  As part of our commitment to transparency and accountability, we are sharing this information with you. In the following attachment you will find statistics and trends that illustrate the current state of Guam, and how our situation has changed over the years.  We will release this in a series of reports over the next several days.
 Last week, we sent you information on crime. Today, we are sending information that helped Guamanians own homes and strengthen their families. The report you will read tells you about the growth and success of our housing and land programs. You will see how many Guamanians are building homes they own, on land that was owed to them and their ancestors.
This is an excellent resource for academics, students, and anyone interested in the true picture of Guam
People’s Living Conditions                                      
Many Guamanian families who fall under the middle to low economic segments – working minimum wage jobs or pulling two jobs just to make ends meet – often can’t afford to rent or build an affordable home. Even with attractive mortgage loan rates from institutional lenders of 6.5 percent to 8 percent for a 30-year payment period.
 
This dilemma is widely seen throughout the island as two sometimes three generations of families occupying a single household just to survive – because the cost of living on Guam is relatively high in comparison to the United States by 35%. This is in correlation to consumer prices of goods and services on Guam and in the U.S. – price of utilities, foods, mortgages, rent, oil, and fuel.
 
Since the island relies heavily on the importation of resources, the costs for these goods and services become greater for Guamanians than our stateside counterparts. These costs also reflect the increase of construction prices for building materials that affect Guam’s families, who are looking to build an affordable home.
 
According to the Guam Housing Corporation (GHC), a modest size home on Guam (3 bedroom 1 bathroom house) ranges between $65 to $90 per square foot. The average price tag to build a simple home on Guam, excluding the price of land, connection of utilities, sewer, water, power, etc. costs approximately $ 78,000 to $150,000. Low to mid-level rentals range from $900-$1,200 for a two-bedroom apartment or condominium and $1,200 to $1,700 for a three-bedroom house.
 
The financial hardships Guamanians face every day with the inflation of goods and services makes it difficult to accomplish their goals in renting or building a home. Thus, many families resort to the government of Guam for assistance with subsidized housing through the Guam Housing and Urban Renewal Authority and GHC’s low-income family housing programs.
 
GHURA                                                                          
From Fiscal Year 2011 to present, statistics indicate that GHURA has helped house approximately 3,034 families (9,102 people) – based on an average household size of 3 – through the Authority’s Public Housing program, Housing Choice Voucher/Section 8 program, and Guma Trankilidat program.
 
These federally funded programs allow GHURA to assist in alleviating the financial burdens on families with low-incomes, the elderly, and persons with disabilities. In addition, GHURA provides affordable rental housing in a variety of sizes and types, from two-bedroom to five-bedroom single-family houses, and one-bedroom units for the elderly.
 
Currently, GHURA has 750 public housing units of which 82 of those units are for the elderly. Additionally, GHURA has 49 elderly units located throughout Guam. This makes the total units for the elderly to be 131. The Government of Guam receives funds from the U.S. Department of Housing and Urban Development (HUD) to administer housing for low-income residents at rents they can afford. GHURA administers these funds for the Government of Guam.
 
 

The U.S. Dept. of Housing and Urban Development (HUD) HOME Investment Partnership Grant (HOME) funds a wide range of activities that build, buy, and rehabilitate affordable housing for rent or home ownership. The grant may fund activities to provide direct rental assistance to low-income families. The program’s flexibility also allows States and local governments to use HOME funds for grants, direct loans, loan guarantees or other forms of credit enhancement, or rental assistance or security deposits.
 
 
 
Housing Choice Vouchers (HCV)                                     
Every year, GHURA administers 2,545 rental vouchers to be utilized by eligible individuals and families to afford privately owned rental-housing units across the island. Annually, Guam receives over $32 million for the operations of this program and payments to landlords of these privately owned units and tenant utility allowances.
 
For the past three years, GHURA’s HCV/Section 8 Program reported that eighty-one percent of the program’s participating families are led by female head-of-households and nineteen percent are led by male head-of-households. The average annual household income for these families recorded was $7,064.
 
Forty-four percent of these families were placed in three-bedroom units; 28 percent in two-bedroom units; and 18 percent in four-bedroom units. The remaining 10 percent placed in one or six bedroom units. Approximately 98 percent of all the families receive some form of general assistance or Temporary Assistance for Needy Families (TANF); 59 percent receive income through wages; 33 percent receive child support; 2 percent own businesses; 19 percent receive social security benefits; 4 percent receive income from other sources; and 27 percent receive non-cash items from various sources.
 
Eighty-nine percent of these recipients are reported as Pacific Islanders, which includes migrants from the Freely Associated States. Nine percent are of Asian descent and the remaining 2 percent are White, Black, American Indian, or other.
 
At the end of FY 2011, the Authority had 703 units leased with an occupancy rate of 93 percent. For the fiscal year ending September 30, 2011, the Authority received $3.96 million in Operating Subsidy funds and $2.07 million in Capital Fund Program funds for our Public Housing program. The Research, Planning and Evaluation Division is responsible for carrying out the modernization/capital improvement program for the Public Housing program. Thirty-four units were taken off-line for modernization, maintenance, or repair during FY2011. The 34 units were completed in FY2012 and are now in service.
 
Of the 2,545 rental vouchers, 175 vouchers benefit persons with disabilities through the government’s Non-Elderly Disabled Voucher program (formerly known as the Mainstream Program). This program assists individuals with disabilities who face difficulties locating suitable and accessible housing in the private market. One hundred thirty-three vouchers are used to support the Family Unification Program, available to families who lack adequate housing resulting in the threat of imminent separation of children from their families.
 
The Veterans Affairs Supportive Housing Program (VASH) provides 30 vouchers to assist homeless veterans who also may receive case management and clinical services provided by the U.S. Office of Veterans Affairs. Additionally, project-based vouchers are utilized for the 49 homes of the Guma’ Trankilidat Program. Guma’ Trankilidat housing in Tumon is open to elderly persons 62 years and older, and adult persons with disabilities.
 
Progression                                                     
Since the beginning of this administration, Guam’s supply of affordable housing has increased with the completed construction of 162 new affordable homes through the Low Income Housing Tax Credit Program and HUD funding. These new homes include Ironwood Heights Phase I and II (132 units), Ten Renewal Homes (10 units), Renaissance Homes (10 units) and Sagan Linahyan (10 units). Most, if not all of these units are already occupied – housing 486 people.
 
 

 
There are currently 393 units under construction for three awarded LIHTC projects, which includes Summer Green Residences, Summer Homes Residences, and Summer Town Estates Senior Elderly Affordable Housing developments. One hundred fifty-three of those units (Summer Green Residences and Summer Town Residences) will be completed by December 2014. The remaining 240 units will be completed by December 2015.
 
 
 
 
Guam Housing Corporation                                             
From July 2012 through December 2013, GHC has assisted 151 Guam families who are first-time homeowners, with down payment assistance and/or closing cost for their mortgage loans – $1.2 million. Guam Housing Corporation’s – Housing Trust Fund Act (HTF) provides locally funded grants as well as enable GHC the capability to pursue various funding sources to administer and manage its programs which includes the First-Time Homeowners Assistance Program, Direct Loan Program, 6 percent Loan Program, Community Affordable Housing Action Trust (CAHAT), Rural Housing Loan Program, and VA Loan Program.
To date, GHC has 449 families participating in various loan programs used to buy or build a home. All of which were unable to get financial assistance from commercial banks – costing a principal balance totaling $30.9 million. In addition, GHC owns 117 houses and 24 apartment units that provide rental opportunities for low to moderate-income families.
As the lead agency in the Affordable Housing Coordinating Council (AHCC), GHC provides the direction of programs and grants with government of Guam agencies and the participation and investment with the private industry. With these efforts, the “Guamanian Dream” of homeownership for the people of Guam has become a reality for many, and an opportunity for many more in the future.
 
The Guam Housing Corporation has established the following goals:
 

1. 1.  Continue negotiations with FHLB (Federal Home Loan Bank) & other financial institutions in “lending capital” for GHC programs (Le.,Regular Loan Program, 6% Loan Program, CAHAT) so we can issue more mortgages to Guamanians.
2. 2.  Pursue and promote alternative building materials, structure, and design to lessen the cost of constructing safe, sanitary, and very affordable, low cost housing.
3. 3.  Continue coordination with partnering GovGuam agencies (DLM, CLTC, GALC) to provide available, developable land to recipients that qualify for homeownership financing and programs (VA, USDA, SUTA)
4. 4.  Work with GHURA and federal agencies with funding sources and layering of grants and programs in development of affordable housing.
5. 5.  Achieve statutory authority to finance the building of new homes by funding “Housing Trust Fund” for GHC programs &initiatives (i.e. FTHAP – First Time Homeowners Assistance Program)
6. 6.  Remove barriers that impede the development of affordable housing. (i.e., amend SDC to exclude “affordable housing”)
7. 7.  Administer the Mortgage Credit Certificate (MCC) program.
8. 8.  Continue MOU with GHURA to construct 200 affordable homes/units for rent or homeownership through the As- Atdas project. Initial investment capitalization of $2.3 million dollars (GHC – $1 mil; GHURA – $1.3 mil).
9. 9.  Develop 65 unused lots with available infrastructure for affordable housing (rental & home ownership) in Sagan Linahyan.
10.  Pursue and apply on “grants.gov” as funding becomes available for development of affordable housing.
11.  Share personnel resources between partnering agencies for training, development, and compliance of housing funding and programs.
12.  Continue support of the annual Guam Affordable Housing Symposium, its members, agencies (local & federal) and industries in the promotion and development of affordable housing for all the people of Guam and the Guamanian Dream of homeownership.

 
 
Moving Forward                                                             
As Guam’s population (159,358 residents – 2010 Census) continues to grow each year, GHURA and GHC are anticipating an increase in affordable housing applicants as well. According to current statistics, there are 4,231 families (12,693 people) who have been placed on GHURA’s HCVP/S8 waiting list–all of whom are anxiously waiting for an opportunity to be situated in public housing units.
 
To mitigate the amount of applicants on the waiting list, the administration has put together an Affordable Housing Strategic Plan of projects through GHURA and GHC. These proposed projects include the development of Chamorro Land Trust Commission Single Family lots (164 units); Department of Land Management and CLTC Land Transfer lots (59 units); Guam Housing As-Atdas lots (200 units), and more Sagan Linahyan units (10 units). These proposed units could be used to house 1,299 more people – based on an average household size of three persons.
 
The anticipated population growth has also influenced GHC to explore alternative building systems – by proposing the development of metal homes instead of the traditional concrete house. These proposed metal homes are considered to be the best solution to for Guam’s low-income families. GHC deems that the metal homes would be more cost efficient and affordable for first time homeowners or individuals who are looking to build.
 
GHC together with CLTC have recently agreed to designate 10 lots in Dededo at the Sagan Linahyan Subdivision, for the development of the first 10 metal model homes.
The building designs for these metal homes vary from single room units to four bedroom units. GHC projects the overall construction cost of a single to four-bedroom metal home ranges between $16,000 to $120,000.
 

 
 
Land Return                                                                   
Today, land ownership on Guam is divided into three major categories: Federal Government, Government of Guam, and private individuals and corporations. According to the Bureau of Planning, the Federal Government controls 32 percent of the island’s total land area as military reservations. The Government of Guam owns approximately 20 percent, and the remainder, about 48 percent, is under private ownership.
 
Despite the financial hurdles many Guamanians face in building an affordable home, they often encounter issues with real estate. Either they don’t have the means to purchase land to build a home on, or they lost their once owned property to the local or federal government. For these reasons, many residents seek the government’s help in resolving property issues and ownership. They also request for an opportunity to buy, lease, or loan government parcels of land for their social, cultural and economic development.
 
The Chamorro Land Trust Commission and Guam Ancestral Lands Commission were established to resolve these property issues and to ensure the well-being and advancement of the Chamorro people by way of residential, agricultural and commercial land distribution. The Commissions are tasked with the responsibility to administer effective and responsible use of our public lands to lessees who exercise good judgment in its use, maintenance and productivity.
 
Between FY 2011 and FY2014, CLTC has leased 46 acres of land for residential use (117 leases) and 124 acres of land for agricultural use (95 leases). Majority of the program’s applicants are farmers requesting to lease government Trust land from CLTC throughout the island for farming development. This allows them to utilize the island’s abundance of natural resources to its maximum potential.
 
 
GALC Land Summary                                                     

 
 
In addition, DLM’s Land for the Landless Program has deeded 10 acres of land (45 deeds) to eligible individuals. The Land for the Landless Program was made available to Guam residents in 1978, providing more than 1,650 lots in Dededo, Talofofo, Umatac, Inarajan, Agat and Merizo that has benefited about 1,036 families – 237 acres in total. Applicants were able to purchase these government deeded lots for $2,500 over a 10-year period. Although the program was considered to be a success, some of its applicants were unable to meet the obligations of their contract. As a result, the defaulted contracts for the Land for the Landless applicants were terminated. CTLC is still in the process of collecting revenues from the 443 Land for the Landless unpaid accounts.
 
Between FY2011 and FY2014, GALC released a total of 879 acres of land to the heirs of their rightful owners.

PDF: SOTI 2014 Housing Report