Affordable Housing and Sustainable Communities: An Affordable

Affordable Housing and Sustainable
Communities: An Affordable Housing
Ordinance from Start to Finish
James E. White, Esq., AICP
Johanna M. Lundgren, Esq., AICP
Dr. James C. Nicholas
Edward Koconis, AICP
Affordable /Workforce Housing
Mandatory Mechanisms: Inclusionary
Zoning and Affordable Housing Linkage
Fees
 Inclusionary Zoning:






Mount Laurel, NJ
Montgomery County, Maryland
Napa, CA
Tallahassee, FL
Linkage Fees


Pitkin County, CO
Teton County, WY
Florida

Affordable Housing Measures Passed:





Affordable Housing Measures Failed:




Village of Islamorada: Hybrid Inclusionary Housing
Requirement/Linkage Fee
Coconut Creek, FL: Linkage
Winter Park, FL: Linkage
Monroe County, FL: Linkage
Collier County, FL: Linkage
Lee County, FL: Linkage
Marathon, FL: Linkage
Pending:

Broward County, FL currently proposing linkage fee
(*List is not inclusive)
Florida Keys Affordable Housing
Problem
Need resident
workforce to ensure
sustainable local
economy.
Workforce
priced out of
rental and
ownership
options
Affordable Housing Disappears

Trailer Parks and Less-Expensive Homes
Fall Prey to Redevelopment
What is affordable housing ?
In general, the income eligible household is said to be
living in affordable housing when it spends no more
than 30% of its income on either rent or mortgage
payments.
Affordable Housing Is A Legal Obligation
The Florida Legislature has recognized the public
purpose in ensuring housing affordability and
furthering affordable housing as a compelling state
interest in a number of ways.
Local Government Comprehensive Planning and
Land Development Regulation Act
Chapter 163, Part II, F.S.
(Growth Management Act)
The requirements for comprehensive planning for
housing are found in Section 163.3177(6)(f), F.S.



Housing all current and anticipated residents
Providing adequate sites
Eliminating substandard housing
Florida Statutes, Chapter 163.3202(3)
Florida’s Growth Management Act encourages local
jurisdictions to adopt
“…innovative land development
regulations which include provisions such as transfer of
development rights, incentive and inclusionary zoning,
planned-unit development, impact fees, and performance
zoning.
Inclusionary Zoning
What is inclusionary zoning?
The term refers to local ordinances or guidelines that
require or encourage residential developments to
include a certain percentage of affordable housing.
Inclusionary Zoning
A typical inclusionary zoning ordinance will set forth a
minimum percentage of units to be provided in a specific
residential development affordable to households at a
particular income level, generally defined as a percentage of
the median income of the area.
This share of units allocated to such households is termed a
“mandatory set-aside.”
The goal of such a process is to establish a relatively
permanent stock of affordable housing units provided by the
private market, to be maintained as affordable.
Inclusionary Zoning: Advantages



Simplicity.
By relying on the private or non-profit sector to actually build
affordable housing, inclusionary zoning can foster an effective
collaboration between government and the non-government
sector.
Inclusionary zoning ordinances generally provide for an “in
lieu fee” provision, allowing a developer to pay a fee
determined to be equivalent to the provision of the required
number of affordable housing units.
Inclusionary Zoning in Florida




Tallahassee-Leon County
Florida Home Builders Sue Tallahassee in February 2006
(Florida Homebuilders Association, et al. v. City of
Tallahassee)
Challenged as a taking of private property without
compensation.
November 2007 decision upheld adoption of inclusionary
zoning.
Affordable Housing
Linkage/Mitigation Fees
What are linkage/mitigation fees ?
Linkage fees are a means for local governments to collect
monies to help support affordable housing construction. These
fees, collected from non-residential and sometimes marketrate residential development, are placed in a trust fund used to
provide for the construction and maintenance of affordable
residential units.
Affordable Housing
Linkage/Mitigation Fees
 Legal
Issues:
Under Florida law, there must be a rational relationship
between the linkage/mitigation fee imposed and the impact of
new construction on the need for affordable housing.
Development of Residential Units
Development of Non-Residential Buildings
Creates demand for labor
Construction
Workers
&
Operations and
Maintenance
Workers
Construction
Workers
&
Workers at New
Development
Many workers earn lower wages
and can’t afford local housing
Demand for
Workforce
Housing
Demand for
Workforce
Housing
Affordable Housing
Linkage/Mitigation Fees

Local governments must determine the need new residential
and non-residential developments create for housing that is
affordable to the workforce, as a legal basis for establishing a
workforce housing mitigation program.

Workforce/Affordable Housing Support Study. A “nexus”
or support study provides the required background and
technical documentation for the workforce housing need
created by new development and remodels, develops a
methodology for determining housing need, and provides
statistical support for mitigation fee calculation.
Affordable Housing
Linkage/Mitigation Fees
Key Considerations for the establishment of a
Linkage/Mitigation Fee Programs:






What does the support study allow?
Which type of development will pay the fee ?
How much square footage of development should be exempted
from fees?
How much will each type of development pay ?
What is the timeline for payment of the fees ?
What will the funds be used for ?
Village of Islamorada’s Steps to Ordinance
RESIDENTIAL
SURVEY
Collection of Data on
Residential Job Generation
SUPPORT STUDY
IMPLEMENTING
LEGISLATION
Inventory and Analysis of
Workforce Need
Generated by
Development
Ordinance Update
Work Sessions to
Present Support
Study and
Implementing
Legislation
Linkage Between Development and Workforce
Housing Need
# Construction
Workers
Required to Build
Residential Units
(per Square Foot)
+
# Operations and
Maintenance
Employees
Needed to Service
Residential Units
(by tenancy and
square foot)
=
Workforce Housing
Need Generated by
Residential Unit
Overview of Workforce Housing Study
Identifying Linkage Between Development and Workforce
Housing Need
$$ Cost of
Prototypical
Workforce
Housing Unit
for Construction
and O&M Workers
_
$$ Cost of Housing
That Is Affordable
to Construction
and O&M Workers
=
$$ Subsidy
Required to
Afford Workforce
Housing Unit
Workforce Housing Study Results
Workforce Housing Need Generated by
Residential Development – Full Time Residents
Operations & Maintenance of Full-Time
Resident Units
Construction
Total
Workforce
Housing
Units
Needed
(Constructio
n & O&M
Employees)
Total
Workforce
Assistance
for
Employees
(Constructio
n & O&M
Employees)
Employees
Housing
Units
Needed
Housing
Assistance
for
Construction
Employees
Employees
Housing
Units
Needed
Housing
Assistance
for
Operations
and
Maintenanc
e
Employees
500
0.015
0.009
$495
0.000
0.000
$0
0.009
$495
750
0.023
0.014
$742
0.000
0.000
$0
0.014
$742
1,000
0.030
0.019
$989
0.013
0.008
$232
0.027
$1,221
1,500
0.045
0.028
$1,484
0.045
0.029
$814
0.057
$2,297
2,000
0.060
0.038
$1,978
0.078
0.049
$1,395
0.087
$3,373
2,500
0.075
0.047
$2,473
0.110
0.069
$1,977
0.117
$4,450
3,000
0.090
0.057
$2,967
0.142
0.090
$2,558
0.147
$5,526
3,500
0.105
0.066
$3,462
0.175
0.110
$3,140
0.176
$6,602
4,000
0.120
0.076
$3,956
0.207
0.130
$3,722
0.206
$7,678
4,500
0.135
0.085
$4,451
0.239
0.151
$4,303
0.236
$8,754
5,000
0.150
0.095
$4,945
0.272
0.171
$4,885
0.266
$9,830
Unit Size
(FT2)
Workforce Housing Study Results
Workforce Housing Need Generated by
Residential Development – All Other Units
Operations & Maintenance of All Other
Residential Units
Construction
Unit Size
(FT2)
Employees
Housing
Units
Needed
Housing
Assistance
for
Operations
and
Maintenance
Employees
Total
Workforce
Housing
Units
Needed
(Constructio
n & O&M
Employees)
Total
Workforce
Housing
Assistance
for
Employees
(Constructio
n & O&M
Employees)
Employees
Housing
Units
Needed
Housing
Assistance
for
Construction
Employees
500
0.015
0.009
$495
0.019
0.012
$342
0.021
$837
750
0.023
0.014
$742
0.035
0.022
$633
0.036
$1,375
1,000
0.030
0.019
$989
0.051
0.032
$924
0.051
$1,913
1,500
0.045
0.028
$1,484
0.084
0.053
$1,506
0.081
$2,989
2,000
0.060
0.038
$1,978
0.116
0.073
$2,087
0.111
$4,065
2,500
0.075
0.047
$2,473
0.148
0.094
$2,669
0.141
$5,141
3,000
0.090
0.057
$2,967
0.181
0.114
$3,250
0.171
$6,218
3,500
0.105
0.066
$3,462
0.213
0.134
$3,832
0.201
$7,294
4,000
0.120
0.076
$3,956
0.245
0.155
$4,413
0.231
$8,370
4,500
0.135
0.085
$4,451
0.278
0.175
$4,995
0.260
$9,446
5,000
0.150
0.095
$4,945
0.310
0.196
$5,577
0.290
$10,522
Determining Need Generated by NonResidential Development: Need Study
Step 1: Classify all non-residential development
into 8 land use categories
Step 2: Determine individual employee and
household earnings per land use category
Step 3: Determine amount of building space
provided per employee for each land use
category
Step 4: Calculate demand for workforce housing
units per 1,000 square feet of development for
each land use category
Land Uses:
Governmental
Industrial
Institutional
Office
Retail
Tourist
Residence
Other
Overview of Workforce Housing Study
Identifying Linkage Between Development and Workforce
Housing Need
$$ Cost of
Prototypical
Workforce
Housing Unit
for construction
workers and
employees
(by land use
category)
_
$$ Cost of Housing
That Is Affordable
for construction workers
and employees
(by land use category)
=
$$ Subsidy
Required to Afford
Workforce Housing
Unit
(by land use category)
Workforce Housing Study Results
Need for Workforce Housing Generated by Non-Residential
Development
Construction
Land Use
Workforce
Housing Units
Needed
Post-Construction
Workforce
Housing
Assistance
Needed
Workforce
Housing
Units Needed
Workforce
Housing
Assistance
Needed
Total
Workforce
Housing Units
Needed
Total
Workforce
Housing
Assistance
Needed
Per 1,000 Square Ft
Governmental
0.019
$989
0.601
$56,928
0.620
$57,918
Industrial
0.019
$989
0.837
$77,898
0.856
$78,888
Institutional
0.019
$989
0.821
$79,210
0.840
$80,199
Office
0.019
$989
1.121
$74,983
1.140
$75,972
Retail
0.019
$989
0.921
$105,501
0.940
$106,490
Tourist
0.019
$989
0.952
$120,955
0.971
$121,944
Citizen Participation and Workshop Process
Workforce Housing Citizens Advisory
Committee
 Local Planning Agency Workshops
 Village Council Workshops

“Hybrid” Inclusionary/Linkage Ordinance
Residential Development
Affordable housing mitigation is calculated
using multiplier determined through
Study. If mitigation does not amount to
“unit”, a fee is due.
 If a “whole unit” is required, developer
required to mitigate through provision of
housing on-site.
 Fee in-lieu may be contributed if actual
construction impracticable
Village of Islamorada’s Resulting Ordinance:
“Hybrid” Inclusionary/Linkage Ordinance
Nonresidential Development
All employee generating development
which is not exempted shall provide
affordable housing for 30% of the number
of households generated by the employee
generating development.
Timeline
Workforce and Affordable Housing
Committee Established and Charged with
Developing Recommendations (6/2004)
 Village Council Directs Staff to Begin
Preparation of a Mandatory Inclusionary
Housing Ordinance / Dr. James C. Nicholas
& Clarion Group Retained (12/2006)
 Study Completed (2/2007)
 Ordinance Adopted (9/2007; effective
date 12/31)

Affordable Housing Goal

Affordable housing goal. To address this
serious community problem and to
maintain the long-term sustainability of
the village’s and county’s economy, as
well as the character of the community,
the village council has established the goal
of providing housing in the village to 30%
of the generated local workforce and their
families, at prices they can afford.
New 4,750 s.f. home
First look for how many affordable units
would be required. Calculate amount by
determining unit need between 5,000s.f.
and 4,500s.f. unit: 0.0873-0.0780 = 0.0093
New 4,750 s.f. home
First look for how many affordable units
would be required. Calculate amount by
determining unit need between 5,000s.f.
and 4,500s.f. unit: 0.0873-0.0780 = 0.0093
Then multiply the difference (0.0093) by the percentage of
the unit needed by the incremental amount (250/500 =
50%)
New 4,750 s.f. home
First look for how many affordable units
would be required. Calculate amount by
determining unit need between 5,000s.f.
and 4,500s.f. unit: 0.0873-0.0780 = 0.0093
Then multiply the difference (0.0093) by the percentage of
the unit needed by the incremental amount (250/500 =
50%)
Then add that amount (0.0093* 50%) to the need of the
smaller unit (0.0780)
(0.0093*50%) + 0.0780 =
0.0827 units mitigation required
Since this is less than one unit an in-lieu fee must be
calculated
New 4,750 s.f. home
Calculate the difference between a
5,000 s.f. and 4,500 s.f. dwelling unit:
$5,417 - $4,864 = $553
New 4,750 s.f. home
Calculate the difference between a
5,000 s.f. and 4,500 s.f. dwelling unit:
$5,417 - $4,864 = $553
Then calculate the incremental size of the unit between the
4,500 s.f. and 5,000 s.f. unit, in this case the increment is
500:
250/500 = 50%
New 4,750 s.f. home
Calculate the difference between a
5,000 s.f. and 4,500 s.f. dwelling unit:
$5,417 - $4,864 = $553
Then calculate the incremental size of the unit between the
4,500 s.f. and 5,000 s.f. unit, in this case the increment is
500:
250/500 = 50%
Then add the incremental amount to the amount of the
smaller unit to get the total fee for the new 4,750 s.f.
dwelling:
($553 *50%) + $4,864 = $5,140.50
Redevelopment of 20 Unit Hotel
(500 s.f.
1,000 s.f.)
Each of 20 rooms would increase 500 s.f. for a
total of 10,000 s.f.
Then calculate Units Needed (10,000 * 0.00019) = 1.9 Units
Redevelopment of 20 Unit Hotel
(500 s.f.
1,000 s.f.)
Each of 20 rooms would increase 500 s.f. for a
total of 10,000 s.f.
Then calculate Units Needed (10,000 * 0.00019) = 1.9
Units
The remaining 0.9 unit requirement =
[(10,000/1.9)*0.9]= 4,736sf
Then calculate the in-lieu fee amount: (4,736*$16.45
s.f.)= $77,908
Redevelopment of 20 Unit Hotel
(500 s.f.
1,000 s.f.)
Each of 20 rooms would increase 500 s.f. for a
total of 10,000 s.f.
Then calculate Units Needed (10,000 * 0.00019) = 1.9
Units
The remaining 0.9 unit requirement =
[(10,000/1.9)*0.9]= 4,736 sf
Then calculate the in-lieu fee amount: (4,736*$16.45
s.f.)= $77,908
Therefore, the total mitigation would be 1 unit plus
$77,908.
Questions and Discussion