Glossary
Affordability
The federal Department of Housing and Urban Development (HUD) defines an "affordable dwelling" as one that a household can obtain for 30 percent or less of its income.
Area Median Income
The area median income (AMI) is defined as the middle income for all households in a region, meaning the mid-point between the highest income earner and the lowest income-earner. The median income in the Seattle Metro Region is close to $100,000 for a family of four. Eligibility for different housing programs is restricted based on income thresholds based on AMI - so, for example to be eligible for certain rental housing programs your household must earn less than 60% of AMI, or $48,150 for a 2-person household.
Community Controlled Financial Institutions
Financial Institutions that come from and is accountable to community rather than private banks or corporations. Examples include public banks, which are owned by the government rather than private investors, and which can leverage government assets for community. Other examples include Real Estate Investment Cooperatives (see below), Community Development Financial Institutions (CDFIs), and Community Development Credit Unions.
Community Control of Land
Communities can assert control over land and development practices to ensure long-term affordability, community uses, etc., by passing policies to set rules for development, or by negotiating legal agreements with developers, called community benefits agreements.
Community Land Trusts
A Community Land Trust is a non-profit organization that separates land into two parts: the land and the structures, sometimes called improvement. The CLT holds the land and sells the structures to a separate entity. As a condition of the sale, owners are limited in the amount of equity they can earn upon sale which keeps the structure affordable permanently. Community Land Trusts have democratic governance across multiple properties and generally have a tripartite governing structure that includes members of the non-profit, residents, and community members.
Community Self-determination
The basic right of a community- whether cultural or other identity- to determine their own future.
Cooperative
Business or housing that is democratically owned by the people who work or are members of the cooperative. In a housing cooperative, each owner owns a ‘share’ of the building and makes decisions together.
Cultural Anchors and Community Owned Businesses
Land, spaces, organizations and businesses that are by and for BIPOC and ethnic communities, preserving and celebrating culture and tradition
Democratic Decision Making
Instead of one leader making a decision for the rest of the community, the community comes together to make decisions by vote or consensus. Each member has an equal voice in making the decision.
Displacement
When people, businesses, and institutions with more money and economic power force people with less money and less power out of their neighborhoods and communities to relocate elsewhere. In the US, displacement has historically harmed communities of color the most, as a direct result of a legacy of colonization, slavery, explicitly and implicitly banning people of color from owning land, etc.
Gentrification
A profit-driven racial and class reconfiguration of urban, working-class and communities of color that have suffered from a history of disinvestment and abandonment. The process is characterized by declines in the number of low-income, people of color in neighborhoods that begin to cater to higher-income workers willing to pay higher rents. Gentrification is driven by private developers, landlords, businesses, and corporations, and supported by the government through policies that facilitate the process of displacement, often in the form of public subsidies. Gentrification happens in areas where commercial and residential land is cheap, relative to other areas in the city and region, and where the potential to turn a profit either through repurposing existing structures or building new ones is great.
Land Acquisition and Preservation Funds
Public and/or community-driven funds that allow community groups to flexibly acquire land. These funds would be focused on land and housing at risk of being sold on the speculative market, land in BIPOC communities, and cultural and commercial space serving BIPOC communities. Funds are flexible, and led by and for community.
Land Banks
A land-bank is a government or quasi-government entity that acquires and holds land for specific purposes, including permanent affordability. Governments have special privileges when it comes to acquiring and holding land, including: holding property tax free, ability to clear title and back taxes, and to set priorities around how the land is used. Land banks can support community stewardship of land by acquiring and holding land until community groups are ready for acquisition and can sell them the land at a moderate price or give land away for free.
Limited Equity Cooperatives
In a limited equity cooperative, residents purchase a share of a ‘cooperative corporation’ that owns the land and structure. Each share entitles its owner to live in the building. In order to maintain permanent affordability, the LEHC limits the amount of equity a shareholder can earn upon resale of their share, when they choose to vacate their unit, keeping it permanently affordable.
Limited Equity/ Restricted Resale
A permanently affordable ownership model that restricts the amount of equity or profit an owner can make in the name of ensuring that the next owner can buy at an affordable price.
Mutual Housing Association
Non-profit organizations set up to own and operate multiple buildings on behalf of its renters. The tenants participate democratically in managing their buildings and making decisions. Unlike a cooperative or community land trust, tenants in mutual housing associations do not own a share or gain equity when they leave. However, getting into an MHA is usually cheaper than buying into a coop.
Non-Profit Development
Mission-driven housing development that reduces the cost of rent through public subsidy and public and private financing. Typically, non-profit developments provide housing that is “income restricted,” meaning you have to qualify for the housing based on the earned income of your household.
Permanent Affordability
Land and buildings that are permanently removed from the real estate market and from speculation by private companies or individuals.
Real Estate Investment Cooperative
A real estate investment cooperative raises small amounts of money from many people in a community to buy land and buildings and then make them permanently affordable to residents and small businesses. Community members buy a share of the cooperative - as little as one hundred dollars - and after a few years, can get it back with a small increase. And, like other cooperatives, share owners govern the organization. Every members get a decision making vote and decide how the cooperative should invest its resources. Examples: NYC Real Estate Investment Cooperative www.nycreic.com
Real Estate Community Investment Trust
Similar to an investment cooperative, a real estate community investment trust that allows residents within a certain geographic area to pool their resources to co-own an income-producing real estate like a strip mall or apartment building. The shares are guaranteed by a bank and the trust will buy-out any shareholder at any time if they would like to cash out or if they move out of the geographic eligibility area. The RECIT model gives small investors the opportunity to access dividend-based income and protects investors from loss.
Speculation
Buying land or developing property now, with the expectation of a significant gain in value in the near future.