By Adam Pagnucco.
In Part One, we explained how the county’s Housing Initiative Fund (HIF) is intended to be used to preserve and construct affordable housing. Today, we will look at the HIF’s revenues and net transfers over time today.
Let’s start with revenues. There are three types of them: recordation taxes, investment income and other, which includes rental income and smaller items. The chart below shows how these three revenue streams have behaved since FY06.
These revenues have increased a lot since the Great Recession. The recordation tax hike of FY17 was no doubt helpful and Council Members Kristin Mink and Will Jawando introduced another one in March. In FY22, the HIF received $28 million in tax revenues and $37 million in total revenues, both probably record amounts.
Another important source of money for the HIF, although it’s not called revenue, is net transfers from other funds. The county has many segregated funds that are supposed to be used for dedicated purposes, but it transfers millions of dollars between them every year. The HIF is a net beneficiary. It receives millions from the general fund every year, which more than makes up for its net transfers out to the debt service fund. The HIF often, but not always, gets net transfers from the capital projects fund too. The chart below shows net transfers from other funds into the HIF since FY06.
The county government has more control over transfers than revenues and it has been making large net transfers into the HIF, including $64 million in FY19 and $50 million in FY21.
Mortgage repayments to the HIF have also increased over time as the chart below shows. These repayments have increased to $27 million in FY21 and $36 million in FY22, probably the top two years in the history of the HIF.
Now let’s add up the revenues, net transfers, mortgage repayments and property sales, which comprise the total inflows to the HIF. The chart below shows their combined amount in nominal dollars and real, inflation-adjusted 2022 dollars using the Washington-Arlington-Alexandria CPI-U as a deflator.
Whether it’s in nominal or real dollar terms, the HIF has received much more money under County Executive Marc Elrich than in the 13 years prior to his tenure. He is justified in claiming credit for that. In Part Three, we will look at how it has been spent.