Inclusionary Zoning: for community/ neighborhood groups

1. Inclusionary Zoning:for community/ neighborhood groups Smart Growth / Smart Energy Toolkit

2. Definition Inclusionary zoning - a local initiative that requires a portion of housing units in a new real estate development to be reserved for affordable housing

3. The Problem • Home prices are rapidly rising; • Affordable housing needs are not filled; • Only 39 out of 351 Massachusetts municipalities met state’s 10% affordable housing requirement; (as of 2005) How can zoning best work with local real estate markets to advance the affordable housing goals of a community?

4. Benefits of Inclusionary Zoning • Expands housing opportunities; • Increases economic diversity; • Prevents sprawl; • Improves transparency in development process; • Distributes affordable housing equitably; • Strengthens economic competitiveness of Massachusetts.

5. Benefits of Inclusionary Zoning Expands housing opportunities • Meets housing needs of individuals at all income levels; • Enables individuals to live and work in the same community. Brookline, MA

6. Benefits of Inclusionary Zoning Increases economic diversity • Promotes mixed-income neighborhoods; • Increases demographic, ethnic, and cultural diversity; • Reverses exclusionary development patterns. Roxbury, MA Andover, MA

7. Benefits of Inclusionary Zoning Minimizes sprawl • Integrates affordable housing into existing developed areas; • Promotes denser infill development through density bonuses and other incentives; • Encourages rehabilitation and preservation of existing structures.

8. Benefits of Inclusionary Zoning Improves transparency in development process • Codifies requirements and incentives associated with residential development; • Increases predictability of residential permitting; • Improves municipal-developer relations.

9. Benefits of Inclusionary Zoning Distribute affordable housing equitably • Promotes regional planning; • Encourages Massachusetts municipalities to develop more affordable housing. Concord, MA Scituate., MA

10. Benefits of Inclusionary Zoning Strengthens economic competitiveness of Massachusetts • Provides housing to individuals at all income levels; • Helps to retain local workforce; • Helps to attract new residents. Amherst, MA

11. Key Policy Considerations • Income level that affordable housing serves; • Mandatory or voluntary zoning provisions; • Amount of affordable housing provided; • Alternatives to on-site development; • Incentives offered to developers.

12. Policy Considerations Income Level • Who qualifies for affordable housing? • Low income household defined as a percentage of area median income (AMI); • HUD Income Limits for Massachusetts. • What is an affordable unit? • Rent  30% gross income; • Mortgage payment  30% gross income.

13. Policy Considerations Mandatory v. Voluntary • Mandatory inclusionary zoning – affordable housing units required as part of every new or rehabilitated residential development; • Voluntary inclusionary zoning – affordable housing not required in by-right development; incentive programs encourage affordable housing development. Mandatory inclusionary zoning is the most effective tool for increasing affordable housing stock in a community.

14. Policy Considerations Amount of Housing Provided • Market demand for affordable housing; • Unit cost of affordable housing; • Number of new units that trigger affordable housing requirements. What percent of new housing units should be affordable?

15. Policy Considerations Incentives • Types of Incentives • Density bonuses; • Expedited Permitting; • Increased Design Flexibility; • Tax Breaks. What combination of incentives will spur the most affordable housing development?

16. Policy Considerations Development Alternatives • Types of Development Alternatives • Fee-in-lieu payments; • Off-site development; • Other waivers or hardship provisions; • Reduce financial burden and risk to developers. • Do development alternatives significantly reduce the number of affordable housing units built?

17. Keys for Success • Zoning compatible with local real estate market; • Supportive neighborhoods; • Supportive development community; • Strong regulatory authority; • Long-term planning. Provincetown, MA

18. Case Studies • Barnstable • Brookline • Cambridge • Marlborough • Newton • Northampton Over 100 communities in Massachusetts have passed inclusionary zoning provisions Brookline, MA

19. Additional Resources • Taking the Initiative: Affordable Housing Strategies Guidebook (3/2003), Guidebook for Local Housing Partnerships (9/2004), and MHP’s Housing Needs Workbook (6/2003), three useful publications for housing partnerships www.mhp.net/community_initiatives/municipalities/housing_partnerships.php • Inclusionary Zoning: Lessons Learned in Massachusetts, Inclusionary Zoning: Guidelines for cities and towns, and Zoning for Housing Affordability, three publications for affordable housing www.mhp.net/vision/zoning.php • The Impact of Inclusionary Zoning on Development www.bpichicago.org/rah/pubs/impact_iz_development.pdf

20. Additional Resources • Mass Dept. of Housing and Community Development www.mass.gov/dhcd/ • Mass Housing Partnership www.mhp.net/ • Town of Barnstable ADU Program Paulette Theresa-McAuliffe, 508-862-4683 • Portland, Oregon ADU Program Mark Bello, mbello@ci.portland.or.us • Santa Cruz, California ADU Program www.ci.santa-cruz.ca.us/hcd/ADU/adu.html