Adapted from comments to the Charlottesville Planning Commission May 9, 2017
By. Neil Williamson, President
The Free Enterprise Forum often speaks of unintended consequences of proposed legislation. We believe staff’s current recommendation regarding regulations around forgiving developer fees heads Charlottesville in the wrong direction.
Please let me explain.
In 2003, fourteen years ago, the US Department of Housing and Urban Development said:
Most housing professionals agree that concentrating assisted-housing for low- and very low-income Americans in dense, urban areas is not an effective use of scarce affordable housing resources. Over the past decade, professionals in the affordable housing industry have turned increasingly to mixed-income housing as an alternative to traditional assisted-housing initiatives. Mixed-income housing is an attractive option because, in addition to creating housing units for occupancy by low-income households, it also contributes to the diversity and stability of American communities.
There have been numerous successful mixed-income developments nationwide. State and local governments have developed incentive programs and initiatives to promote mixed-income housing. In the past decade, the U.S. Department of Housing and Urban Development (HUD) has provided support for public housing authorities to de-concentrate traditional public housing in favor of the development of mixed-income housing. In addition, HUD funding from the HOME Investment Partnerships Program can also be a valuable resource for states and local jurisdictions to finance mixed-income housing initiatives, or to develop, design and implement new mixed-income housing programs that address local housing needs. HOME funds are specifically designed to be flexible in order to meet local housing needs.
In practice, I have seen Charlottesville intentionally moving toward more mixed income neighborhoods as a tapestry of price points for the communities being developed.
Why then would staff recommend the following:
To ensure the affordable units are actually provided in new developments, staff recommends no Certificates of Occupancy be issued until the City confirms the affordable units have been developed and the developer has entered into an agreement with the City that these units will remain affordable for a specified period of time.
While this may look good on paper, the reality is that by DEMANDING the developer build the affordable units prior to receiving certificates of occupancy for the market rate units virtually guarantees the affordable units will not be mixed with market rate rather will be concentrated in one portion of the project. Further, by positioning the affordable units first in the pipeline this well intentioned requirement would create significant financing challenges for the development project as a whole.
If the Planning Commission is committed to mixed income communities that are truly mixed, the Free Enterprise Forum requests that you strike this language and move forward with the concept of development fee forgiveness as a small step to address the larger housing affordability crisis in our region.
Neil Williamson, President
Neil Williamson is the President of The Free Enterprise Forum, a privately funded public policy organization covering the City of Charlottesville as well as Albemarle, Greene, Fluvanna, Louisa and Nelson County.
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