Linda Oddonetto, the City's Economic Director, standing on G-Hill overlooking Globe. Photo by LCGross
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Community leaders say housing studies crucial for future growth

The state of the housing market in the Globe-Miami area has been a topic of debate for years, if not decades, and solutions seem to be elusive if the region is to experience the growth community leaders hope and plan for.

The City of Globe has gathered the resources to contract with Central Arizona Governments (CAG) to create an updated—and updatable—housing study to use as a tool for future development.

“We need to update every 3-4 years for a quality baseline,” says City of Globe Economic Development Department (EDD) Director Linda Oddonetto. “If we do this one right, a future update won’t be as big a lift.”

The proposed study is an outgrowth of an effort by the EDD to create a community economic plan through a grant from the Rural Community Assistance Corporation (RCAC). While the $45,000 study is not completely funded as yet, Oddonetto predicts it will be “well underway” by the end of 2019.

Funding so far has been provided by Freeport-McMoRan, the City of Globe, Cobre Valley Regional Medical Center, the Board of Supervisors and Oddonetto expects to get additional funds from the Southern Gila County Economic Development Corporation, one of the five “bed tax” groups that receives tax revenues from the city.

Across the board, both critics and supporters of the concept believe it is an important tool to have. In order to qualify for any type of affordable housing grants, or for potential developers to obtain financing, an up-to-date study is required.

Since 1992, there have been a number of housing studies done for various purposes. Across the board, past studies have pointed to the condition of housing in the area as contributing to what’s being called a crisis situation. Water and sewer infrastructure, as well as geographic features that make the area an attractive place to live but limit the amount of buildable space, can also be a problem for potential builders.

One recent study, done by Griffin Consulting in Mesa, was initiated by the Gila County Industrial Development Agency (IDA) and published in June 2014.

That study was specific for a mid- to low-income level apartment complex that was never built, due in large part to insufficient infrastructure at the location between Fry’s and Highway 188 on the north side of Highway 60. 

Globe Workforce Apartments was intended to create housing for local workers and seniors in an attempt to address a lack of rental units in the Globe-Miami corridor.

The location is on a cleared hill behind the Travelodge Motel and would have been optimal for residents in need of nearby services and on a limited income.

The 4-acre site would have provided 200-250 apartments for a “general occupancy/family apartment complex” to include both market-rate and affordable units, provided the builder received tax credits for including low-income housing.

“We looked at several large portions of land and tried to create a workforce study the builder could use,” says former IDA President Fred Barcón. “The city didn’t have one, so the IDA went out to find [someone] who could provide it.”

The study cost $15,000 and was specific to the project, proposed by Redbridge Development Partners, a national builder that works with under-served communities and specializes in public-private partnership development.

In addition to challenges with water at the site—there would have to be a substantial investment to bring the piping system up to current fire code—the study determined a lift station would have to be built to tap into the Globe wastewater system, at a cost of at least $250,000.

Other issues included the age of existing housing and a high proportion of seasonal residences that, while not technically vacant, are not available to the market. 

Vacancy rates in Globe-Miami in 2012 were estimated at 18.2%, with 583 of Globe’s 3,351 housing units and 186 of Miami’s 881 unoccupied. “Seasonal, recreational or occasional” use accounted for 30.4% of those vacancies, but those were not considered “of concern relative to the health of the area housing market.”

More than 1,000 residential units were considered “substandard.”

Fred Barcon points to the area once considered for a development project involving 200-250 apartments. Photo by David Abbott

Be that as it may, without a current study that delves into the minutiae of the market, from future employment opportunities to the community’s approach to increasing housing stock, the situation will remain in crisis.

“People who are coming in to invest need it,” Barcón says. “We’re running off investors. It’s not that we’re doing economic development wrong, but there is a stigma of not working with investors.”

A more current, but narrower study, the “Copper Triangle Housing Assessment,” prepared for Resolution Copper by Elliot D. Pollack & Company, of Scottsdale, in 2016 was specific to the Resolution Mine project. Although most of the economic benefit will be to the west in the East Valley and Superior, the Resolution study looked at population demographics and the state of housing in general.

The Resolution study determined that by the year 2050, Gila County would experience a 0.1% population loss after significant increases from 2000-2015.

During that time span, Globe’s population dropped 1.4%, from 7,486 to 7,430. Miami, though, saw an increase of 11.7%, while Claypool, Central Heights-Midland City both recorded nearly 20% increases in population.

The Median year houses were built on average in Globe was 1965 and the median in Miami was 1942. 

The Resolution study pointed to a common problem cited in most studies of the area—including the Preliminary Engineering Report for the Tri City Regional Sanitary District—about a debilitating lack of plumbing that includes nearly 7% of Globe units and nearly 12% in Miami.

Further, a stakeholder meeting held in May 2017 found that:

  • There is a limited supply of quality rental housing and what is available is usually subsidized for low and moderate income residents.
  • There is a limited inventory of quality homes on the market and most for‐sale homes are not move‐in ready.
  • The local housing market is not competitive with new housing in Apache Junction, Mesa, Florence and Gold Canyon.
  • Globe, Superior and other cities are landlocked with a marginal supply of land that can be developed for residential uses.
  • Many local employees preferred to live in Apache Junction, Mesa, Florence and Gold Canyon and commute to work because of the newer housing stock, amenities, good schools, etc.

Two additional studies completed by the University of Arizona Drachman Institute for Land and Regional Development, done in 1992 and 2006, largely echoed those findings. The May, 1992 assessment stated that, “The housing problem in Globe-Miami is not one of vacancy—it is a problem in the availability (or supply) of good quality housing for the full range of households currently living in or likely to move to the Globe-Miami area.” 

The 2006 study asserts, ‘The dramatic number of homes that are in need of rehabilitation or have degraded beyond the point where rehabilitation is a feasible option, clearly indicates that rehabilitation and infill development should be priority strategies for the Globe-Miami area.”

There are those who think there is a housing shortage in low-income and rental housing, but that the market is not bad for a certain size and price point and any tweaking could ruin the equilibrium. 

Oak Realty Agent Eric DuFriend points to communities such as Queen Creek and San Tan Valley that overbuilt and are experiencing what he terms “market crashes.”

“What if [the study] comes back and there’s no shortage? If we build 20, 50 or even 100 units, supply might exceed demand and flood the market,” says DuFriend, who is an advocate for addressing the abandoned house issue and rebuilding with infill. “Globe is a great market, where you can find an affordable house…. Globe needs to reinvent itself.”

Oddonetto sees the problem as one that reaches far beyond the confines of Globe-Miami and that every community can benefit from increased housing supplies. She related a recent case where a mineworker from Graham County bought a house in Globe because he could not find what he was looking for closer to the job.

“There is truly a need for more housing stock and we need quantifiable data if we want to see growth,” she says. “Our goal is create a tool that all community stakeholders can use for their respective projects.”

As to the housing crisis, Oddonetto thinks the area may already be behind the curve considering at least one aspect of the market, employee leakage, which happens when workers live in other places, but commute to the Globe-Miami area.

“When should we have considered it a crisis? Capstone has 60% leakage at Freeport,” she says. “Maybe when hit 30%, we should have looked at it. Major employers need information.” 

 

Part 1: Growing Pains: Housing

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