CMM Economic Development & Housing 3 — Questions and Answers
Question 1: A city's economic development office is performing a 'gap analysis' for a proposed mixed-income housing project. What are they assessing?
- The difference between the city's current and target population growth rates
- The financial shortfall between development costs and achievable revenues that requires public subsidy (Correct answer)
- The gap in zoning between commercial and residential districts
- The difference between existing housing stock and projected demolitions
Correct answer: The financial shortfall between development costs and achievable revenues that requires public subsidy
A financial gap analysis in development determines how much public subsidy is needed to make a project financially feasible when costs exceed achievable market revenues.
Question 2: Which housing strategy focuses on providing rental assistance vouchers that allow low-income households to rent privately-owned units in the market?
- Public Housing Program
- Section 8 Housing Choice Voucher Program (Correct answer)
- HOME Tenant-Based Rental Assistance
- LIHTC Rental Subsidy
Correct answer: Section 8 Housing Choice Voucher Program
The Section 8 Housing Choice Voucher Program provides rental subsidies directly to eligible households, who then find housing in the private market.
Question 3: A municipality uses 'eminent domain' for economic development. Under the 2005 Kelo v. City of New London Supreme Court ruling, what was affirmed?
- Eminent domain can only be used for public facilities like roads and parks
- Government can take private property for economic development purposes that benefit the public (Correct answer)
- Property owners must receive above-market compensation when eminent domain is used for development
- States are prohibited from using eminent domain for private economic development projects
Correct answer: Government can take private property for economic development purposes that benefit the public
Kelo v. City of New London affirmed that economic development can constitute a 'public use' justifying eminent domain, though many states subsequently passed laws restricting this use.
Question 4: What is a 'Business Improvement District' (BID)?
- A federally designated zone offering tax credits for business investment
- A defined area where property owners pay a special assessment to fund supplemental services and improvements (Correct answer)
- A municipal department responsible for issuing business licenses
- A zoning overlay that permits higher-density commercial development
Correct answer: A defined area where property owners pay a special assessment to fund supplemental services and improvements
A BID is a defined geographic area where property owners collectively fund and manage supplemental services such as cleaning, security, and marketing beyond what the municipality provides.
Question 5: Which metric is commonly used to measure housing affordability at the regional level and is published annually by HUD?
- Median Market Rent (MMR)
- Area Median Income (AMI) (Correct answer)
- Fair Market Rent (FMR) only
- Housing Opportunity Index (HOI)
Correct answer: Area Median Income (AMI)
Area Median Income (AMI) is HUD's annual estimate of the midpoint income for a metropolitan area, used as the basis for determining affordable housing income thresholds.
Question 6: A city wants to revitalize a contaminated former industrial site. Which federal program specifically supports the assessment and cleanup of brownfield sites?
- Superfund (CERCLA) Program
- EPA Brownfields Program (Correct answer)
- HUD Choice Neighborhoods Initiative
- EDA Public Works Program
Correct answer: EPA Brownfields Program
The EPA Brownfields Program provides grants and technical assistance for assessing, cleaning up, and redeveloping contaminated brownfield properties for productive reuse.
Question 7: What does 'workforce housing' typically refer to in the context of municipal housing policy?
- Housing exclusively for municipal government employees
- Housing affordable to households earning between 60% and 120% of AMI, often teachers, nurses, and first responders (Correct answer)
- Subsidized dormitory-style housing located near employment centers
- Housing units reserved for workers in federally funded construction projects
Correct answer: Housing affordable to households earning between 60% and 120% of AMI, often teachers, nurses, and first responders
Workforce housing targets the 'missing middle' income range—households earning too much for subsidized housing but too little to afford market-rate housing in high-cost areas.
CMM Economic Development & Housing 3
A city's economic development office is performing a 'gap analysis' for a proposed mixed-income housing project.
What are they assessing?