City leaders wrestling with the budget have a fairly simple decision to make: Dedicate regular contributions to the city's Affordable Housing Trust Fund, and decide how to spend it later.

The possibilities, as discussed in a Monday City Council study session, seem to be as numerous as Ashland's growing homeless population. The specifics would depend on how much money is in the fund, how it is invested and whether it can leverage grant money from outside sources.

Housing advocates say cities with active trust funds average $6.50 in outside funding for every $1 of local money going in.

Housing and Human Services Commission Chairman Rich Rohde said small amounts of money could fund "micro-grants" targeting the greatest need. Larger sums could support affordable and low-income housing projects.

Portland is proposing a "granny flat" project that would build tiny houses in homeowners' backyards at city expense. Each home would be occupied rent-free by a homeless family for five years, after which it would revert to the property owner, who could rent it out at market rates.

That may be a bit ambitious for Ashland — Portland is estimating each home could cost $75,000 — but it illustrates the range of possibilities.

It also would increase density — something the city essentially committed to when it decided not to expand the city limits.

City councilors asked detailed questions about the suggestions, but the details are less important at this point than the commitment. Feeding the fund is just the first step.