Charlottesville to Make New Housing Units LESS affordable

Sometime after 10:00 pm this evening, Charlottesville’s Planning Commission will likely pass the “Affordable Housing Zoning Text Amendment” which will require 5% of the square footage in certain projects (Special Use Permits and Rezonings) be offered as “affordable”, or offer cash equivalent. 

The concept is that applicants that wish to receive additional density will do so at a cost of providing affordable housing.  The reality is the economic result of this action will be an increase of cost of the 95% of the project [or 100% if the cash option is used] to subsidize the non market rate units [or cash equivalent].

In his July 30 Memorandum to the Charlottesville Planning Commission, Neighborhood Planner Nick Rogers delineates the standard of review required for such a change:

The Planning Commission must make an advisory recommendation to City Council.  Council may amend the zoning ordinance upon finding that the proposed amendment would serve the interests of “public necessity, convenience, general welfare, or good zoning practice.”  [Italics in original-nw]

Rogers continues in his analysis:

Staff has not yet developed an effective strategy for implementing or monitoring the 30-year, long term affordability Innovative Ideas are being used throughout the country in similar situations, such as a community land trust, a limited-equity cooperative, or resale-restricted individual ownership.  ….. Given the current economic downturn, and the minimal number of qualifying projects in discussion, staff is comfortable that a solution to guarantee the 30-year term of affordability can be generated in the near future.

In owner-occupied situations, the initial sale of the unit can be ensured affordable by requiring the developer to submit documentation that the sale price was at or below the 60% income threshold to obtain a certificate of occupancy.  Deed restrictions that require compliance with the 30-year affordability term offer another solution.  However, based on preliminary feedback from the development community,most developers will likely opt to use the cash formula.

….Cash contributions made to satisfy this ordinance’s requirements would aid Council’s strategy to raise “significant resources” for the City’s Housing Fund.

Charlottesville is actually a little late getting in on this stealth new home buyer tax.  Governor Kaine signed the requiring enabling legislation earlier this year.  Albemarle County [which has had such authority] has mandated affordable housing in its new projects for a number of years. As The Free Enterprise Forum predicted when Albemarle considered their ordinance, the costs have been passed on to the end user.  In addition for those new affordable units that have come on-line, it has been VERY difficult to find buyers that meet the income restrictions with quality credit history to permit financing.

Charlottesville City Council has stated their vision for affordable housing to offer housing “that is affordable and attainable for people of all income levels, life stages, and abilities”.   If this is a stated community goal, why is the cost burden being placed clearly on the new residential unit buyer?  

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