Zoning Change Would Require Affordability

In round two of a planned zoning-code overhaul, the Elicker Administration is seeking to require developers to include affordable units in new and rehabbed apartment complexes — with a focus on the city’s ​“core.”

That latest zoning-reform pitch is included in a proposed ​“inclusionary zoning” ordinance text amendment and map change submitted to the Board of Alders this week by City Plan Director Aïcha Woods.

The proposed land-use-law updates will next be heard and voted on by the City Plan Commission before returning to the alders for further public hearings, debate, and a potential final vote.

If approved, the local zoning changes would require new and significantly rehabbed downtown-adjacent apartment buildings with at least 10 residential units to set aside between 5 and 10 percent of their dwelling units at rents affordable to tenants earning no more than 50 percent of the area median income (AMI). That currently comes to around $45,800 for a family of four. Those city center apartment buildings must also use ​“prioritize” housing tenants with federal Section 8 rental subsidies in an additional 5 percent of the building’s units.

Outside of the city center, the proposed zoning updates would require new and significantly rehabbed larger apartment buildings with 75 units or more and that are located to set aside 5 percent of their housing units at that same 50 percent AMI affordable rental rate.

The policy allows developers to ​“buy” their way out of the requirement.

“This policy will require and enable the inclusion of affordable housing in market rate developments that currently do not have any requirements for affordable housing,” Woods wrote in a cover letter submitted to the alders alongside the proposed zoning update. ​“Developers who specialize in affordable housing may also avail themselves of the incentives and provide additional levels of affordable housing based on other available subsidies.”

The inclusionary zoning proposal marks the most comprehensive and substantive set of suggested policy changes to date on an issue that featured prominently in the Affordable Housing Task Force’s 2019 recommendations report, that was debated and ultimately pulled from the city’s commercial corridor rezoning project that same year, and that the Elicker Administration studied with the help of Harvard student researchers soon after the mayor took office in early 2020.

It also comes soon after Woods’s City Plan Department introduced a separate set of zoning reforms designed to promote affordable housing development by making it easier to build garage, basement and attic apartments and by dropping the minimum lot size requirement citywide to 4,000 square feet. The City Plan Commission is holding a special public hearing on Wednesday at 6 p.m. to discuss those zoning-update proposals.

Click here, here, here, here, here, here, and here to read the inclusionary zoning ordinance documents submitted to the Board of Alders.

How It Would Work

The proposed zoning code updates include two key parts: a change to the city’s zoning map, and a change to the text of the city’s zoning laws.

First, the updates would add a new ​“inclusionary zoning overlay” to the city’s current zoning district map. That overlay would divide the city into three ​“markets” emanating from the city center:

• A Core Market, which covers all of Downtown, the Ninth Square, Wooster Square, and the eastern half of Dixwell. ​“The Core Market represents locations where the majority of new market-rate development is occurring today, rents are highest, and where the majority of new market rate development is anticipated,” the proposed ordinance amendment reads.

• A Strong Market, which includes the northern part of the Hill, Dwight, the rest of Dixwell, the southern half of Newhallville, Prospect Hill, East Rock, Mill River, the westernmost sliver of Fair Haven, Long Wharf, and Westville Village. ​“The Strong Market represents areas that have potential to support new market-rate development today and in the immediate future.”

• And the rest of the city, which the proposed inclusionary zoning overlay does not cover, including such neighborhoods as Edgewood, Beaver Hills, Amity, most of Westville and Newhallville and Fair Haven and the Hill, Quinnipiac Meadows, Fair Haven Heights, West Rock, the East Shore, and Morris Cove.

The proposed zoning text amendments would then set different affordable apartment set-aside requirements based on the size and location of the apartment building.

The inclusionary zoning ordinance as drafted would apply to ​“all new construction and any rehabilitation, conversion, or renovation of existing buildings that is valued greater than 50% of the existing assessed value of the property,” and that meets any of the following criteria:

• In the city center’s ​“Core Market” area, any apartment building with 10 or more residential units must set aside no less than 10 percent of the total number of dwelling units at rents affordable to tenants earning no more than 50 percent of the Area Median Income (AMI) as defined by the federal Department of Housing and Urban Development (HUD). Those developments must also ​“prioritize an additional five percent (5%) of the total number of dwelling units for persons or families with Housing Choice (Section 8) vouchers. If tenants with Housing Choice vouchers are not able to be placed and proper documentation is approved by the City, a unit with Housing Choice priority may be rented at no more than 80% AMI until vacancies recur, at which time Housing Choice tenants will be re-prioritized.”

• In the city center-adjacent ​“Strong Market” area, any apartment building with 10 or more residential units must set aside no less than 5 percent of the total number of dwelling units for renters earning no more than 50 percent AMI.

• Outside of the ​“Core Market” and ​“Strong Market” areas, any apartment buildings citywide with 75 or more residential units must set aside no less than 5 percent of the total number of dwelling units for renters earning no more than 50 percent AMI.

“This Inclusionary Zoning Policy goes well beyond many similar policies in other cities around the country as it is targeted specifically to the Area Median Income (AMI) levels that reflects the levels of greatest need in the City of New Haven at 50% AMI and below,” Woods wrote in the cover letter of her proposed ordinance amendment submission to the alders. ​“It also includes a deeply affordable component at 30% AMI levels achieved through prioritizing voucher recipients.”

The proposed law would restrict these set-aside units at the mandated income-restricted rental rates for a minimum of 99 years. The affordable units would have to be evenly distributed throughout the relevant development, and they must consist of a mix of unit types and sizes that matches the overall mix of unit types and sizes in the overall building.

The proposed law would also exempt from having to comply with this new ordinance all public housing authority properties, senior living facilities, student housing, and rooming, boarding or lodging houses.

Bonuses For Compliant Developments

The proposed zoning law update does include some perks for developers who abide by the new set-asides. (There is also a provision of the proposed law that allows for the voluntary participation of owners of apartment buildings with less than 10 units near the city center, or less than 75 units outside of the ​“inclusionary zoning overlay.”)

• One of those perks comes in the form of a Floor Area Ration (FAR) bonus. FAR refers to the ratio of a building’s total floor area to the size of the lot on which the building sits. The higher the allowable FAR, the larger a building can be.

An inclusionary development is entitled to a bonus in FAR of up to 25 percent over the permitted FAR in the underlying zone in which the property is located, the proposed ordinance amendment reads. The building may still be limited in size by height restrictions and other bulk area requirements independent of that district’s FAR limit.

• Inclusionary developments also do not have to provide any minimum amount of parking otherwise required for residential uses ​“but may elect to include parking as part of the development.” Sections 29 and 45 of the city’s zoning ordinance, as they relate to parking minimums for residential buildings, are waived for compliant inclusionary developments.

• Inclusionary developments are also entitled to a density of 600 square feet for the average gross floor area per dwelling unit, regardless of the density limits of the underlying zone. ​“This reduction is applicable to all structures, regardless of age and lot size, whether conforming or nonconforming, so long as they are permissible under applicable building codes.”

• And inclusionary zoning developments can take advantage of tax abatement benefits that would come to a 10-year, 30-percent abatement per affordable unit for ​“core market” developments, and a 10-year, 5 percent abatement per affordable unit for ​“strong market” developments. Woods estimated in an accompany fiscal impact statement that the former would cost the city roughly $70,000 to $80,000 per unit over the 10-year term of such an abatement, while the latter would cost roughly $30,000 in that time.

That same fiscal statement estimates that private developers would have to cover rent over the course of a 30-year period to the tune of $414,000 to $486,000 per unit for 50 percent AMI-affordable units in the ​“strong market,” between $288,000 and $360,000 for 80 percent AMI-affordable apartments in the ​“strong market,” and between $324,000 to $360,000 for 50 percent AMI-affordable apartments in the ​“core market.”

Buy-Out Option

The proposed inclusionary zoning ordinance does include a key provision that allows landlords and developers to pay their way out of providing affordable housing as defined by the proposed local law.

That buy-out clause is in a section entitled ​“Payment in Lieu of Development Affordable Housing Units.”

Developers in the ​“core” and ​“strong market” areas can, instead of providing the requisite affordable set asides, make a ​“payment in lieu of constructing the affordable housing obligation” to the city’s Affordable Housing Trust Fund.

“The amount of the payment in-lieu figure is based upon a tiered payment-in-lieu system that will be reassessed every 3 years from the effective date of this Section’s adoption,” the proposed ordinance reads. The fees will be detailed in a new city Affordable Housing Manual that will be on file with the City Plan Department and the Livable City Initiative.

“In advance of Site Plan Review by the City Plan Commission, the developer must supply the Affordable Housing Agreement, deed restriction, and Payment in Lieu of Agreement to the Director of the Livable City Initiative.”

A fiscal impact statement submitted by Woods to the alders states that the per unit fee for developers looking to opt out of the affordability requirement would be between $210,000 and $225,000 for buildings in the ​“core market,” and between $168,000 and $176,000 per unit in the ​“strong market.”

“Progressive” Landmark Or ​“Wildly Insufficient”?

After the Independent published this article about the new proposed inclusionary zoning policy, mayoral challenger Karen DuBois-Walton and Mayor Justin Elicker issued dueling press releases about the current administration’s efforts to promote affordable housing through the submitted zoning change.

“The mayor’s new plan for inclusionary zoning is wildly insufficient,” DuBois-Walton said. Before launching her official mayoral challenge, DuBois-Walton ran the city’s public housing authority for 14 years, sat on the city’s Affordable Housing Task Force, and has been a longtime advocate at the local and state levels for the creation and preservation of affordable housing.

“More than half of New Haven families are rent-burdened and our city is short 25,000 affordable units,” she continued.

“Requiring five- to ten-percent affordability in new market-rate developments isn’t a serious proposal to actually improve affordability in the city. Moreover, the tax abatements built into this proposal continue to cut into city revenue while protecting profits for large-scale developers.

“A meaningful zoning improvement would create more opportunity for small-scale, local developers and ensure that tax abatements generate more than minimal affordability.”

DuBois-Walton’s campaign sent out that press release at 1:16 p.m.

The mayor’s office sent out a press release at 3:41 p.m.

“This proposal has the potential to make our community more affordable and more equitable,” Elicker said. ​“It’s one of the most progressive Inclusionary Zoning policies in the region and focuses most on income levels of highest need. This policy will help the city provide high quality housing choices for all residents in all neighborhoods.”

“I’ve long said my vision for New Haven is a city where everyone can thrive no matter which neighborhood they’re from – and this proposal will help us make significant progress toward that vision. I look forward to working with the Alders to pass this ordinance. I’d like to thank city staff and community members for the work they put into drafting this ordinance. In particular I’d like to thank City Plan Director Aicha Woods for her work. Our team worked in a collaborative and inclusive way to get to what we believe is the best proposal to balance the needs for the creation of additional affordable units in our city and our ability to attract investment.”