Deets On Housing (aka The Budget to End Housing Insecurity)
Housing For All
Too many younger Americans will never know the experience of home ownership if we continue down this path.
We need a change. A drastic one. NOW.
Homelessness should not exist in a nation of wealth and technology.
But… We do need to rethink what a “house” is in the 21st century in light of climate change.
We need to start building DOWN using 3D-printed homes technology. A good chunk of home electrical usage is climate control.
Building into the Earth solves housing and helps us reach net zero.
We can make Green Homes For All a reality.
At the time of this writing on December 7, 2021, Kansas City, MO has approximately 3,000 houseless individuals in the metro area.
While the city hypes up a “tiny homes” proposition, the data is coming out that tiny homes aren’t as dependable as they claim to be.
We need a real plan to address the houseless crisis and get people the help they need.
This is that plan.
Step One: Purchasing Hotels
Kansas City’s three largest hotels – The Marriott, the Westin, and the Sheraton – share a combined 2,307 rooms and an additional 105 suites. Those three hotels alone would (temporarily) house ~2,500 out of the ~3,000 houseless.
As a municipality, Kansas City has the power to eminent domain these businesses – especially in a pandemic – for fair market value.
The Marriott was recently purchased in November 2021, but as far as I can tell the purchase price is undisclosed.
So, let’s work backward.
The previous owners invested $65 million into the property.
The previous owners purchased the hotel in 2010 for $101 million. Since the pandemic wiped out most hotel real estate gains over the past decade, we can virtually ignore inflation.
So… $101 million + 65 million = $166 million. Let’s round that up to $170 million to assess fair market value.
Now let’s do the math:
$170,000,000 / 971 rooms = $175,077.24 per room. We can apply that template to the other hotels:
Westin: 720 rooms x $175,077.24 = $126,055,612.8
Sheraton : 717 rooms x $175,077.24 = $125,530,381.08
Total cost to eminent domain these hotels: $421,585,993.88
Once established, we can bring in community health workers to get the newly-housed established with Missouri Medicaid and other entitlement programs.
Step Two: Emergency Staffing Hotels
Those in transitional housing at the hotels will need medical care and on-site safe-use rooms. Let’s staff each hotel 24/7 with an on-site RN.
365 days x 24 hours a day = 8,760 hours/year x 3 locations = 26,280 hours/year
26,280 hours/year x $40/hour = $1,051,200/year
We will also need an EMT on-site 24/7 at each location:
26,280 hours/year x $20/hour = $525,600.
Annual Budget for emergency staffing: $1,576,800
Step Three: Permanent Housing
Kansas City has ~334 vacant lots. These lots cost the city ~$1.6 million a year in maintenance fees.
Let’s clear and build.
334 lots x $1,266 per cleared lot = $422,844.00
334 lots x $37,700 per 1,500 sq ft 3D printed house: $12,591,800.00
Total for permanent housing: $13,014,644
Once established, we can move renters of these new units onto a Pay As You Earn rental plan.
If a property can be quickly and affordably brought up to code, bring the property up to code and enter the unhoused into the above Pay As You Earn plan.
This route can also replace the abysmal Land Bank Initiative failure.
Cost To End Houselessnees in Kansas City
Step One: $421,585,993.88
Step Two: $1,576,800
Step Three: $13,014,64
Total Cost: $423,175,808.52
Savings from Ending Houselessness
America spends ~ $35,578 per year per houseless person. That estimate can be upwards of $83,000 per year per houseless person.
Featured: Can 3D printing become a solution for the housing shortage? – PBS February 23, 2022
3,000 houseless individuals x $35,578 = $106,734,000
Saved from abandoned lots = $1,600,000
Total saved annually = $108,334,000
Paying to End Houselessness in Kansas City
Kansas City received ~$15,521,139.00 in 2020 from HUD to address houselessness. That is enough to cover Steps two and three, but we still need the $100 million to purchase the hotels.
For that $100 million, we’re going to need a little more help.
And that help comes in the form of the GSA’s Office of Real Property Utilization and Disposal. This step initiates the process of eminent domain by pushing the property to market while giving the city the right of first refusal. This step doesn’t necessarily help pay for the properties, but this step can keep third properties from sweeping in and buying the property from under the city.
While I would love to go the route of existing grants to pay for this, many of those will have already expired. So, that leaves taxes.
The Missouri corporate tax rate is 4%. Conversely, California recently raised its corporate tax rate to 9.6%. Kansas City currently has a 1% corporate tax rate.
I propose that we get on par with California and raise the city’s corporate tax rate from 1% to 5.6%.
Currently, Kansas City takes in ~$50 million/year in corporate taxes at a 1% tax rate.
At 5.6%, Kansas City would take in ~ $280,000,000/year from corporations.
An increase of $230,000,000 per year.
This comes at virtually no cost to the corporation – as they can in turn deduct that tax payment from their Federal Taxes.
Since the existing HUD funds cover the costs to clear the land and build the 3D-printed houses, we can initially devote the entire increased corporate taxes to the hotels.
$423,175,808.52 / $230,000,000 = 1.84 years to pay off the eminent domain costs.
Guaranteed Housing For All
We can extrapolate the above for a rough estimate of how much it would cost to permanently end housing insecurity for the entire State of Missouri.
Cost to end housing insecurity in Kansas City: $423,175,808.52
Unhoused population in Kansas City: 3,000
$423,175,808.52 / 3,000 = $141,058.60 to provide housing security per housing-insecure individual.
There are ~6,179 unhoused citizens in Missouri.
$141,058.60 x 6,179 = $871,601,089.40
So… Just a shade under a billion dollars could potentially permanently end housing insecurity for the entire State of Missouri.
Extrapolate that further:
$871,601,089.40 x 50 States = $43,580,054,470
Or, alternatively:
$141,058.60 x 580,466 unhoused nationwide = $81,879,721,307.6
Granted, that’s averaging fifty States, but we could end housing insecurity nationwide for ~$40 billion – $80 billion.
HUD is currently spending almost $70 billion annually on broken programs that keep people on the streets.
With the budget re-appropriated, we could end housing insecurity in the United States in as little as 1-2 years.
It seems like a small investment to me.
- Deets
Written On November 25, 2021