Bob Geary covers affordable housing initiatives

Click for larger image • North Hills East, the massive mixed-use development under construction in Raleigh, could have bus transit in its future. But the city didn't require affordable-housing units in exchange for a rezoning that allowed higher density. A task force says that policy must change. Photo by Bob Geary

Pushing Raleigh on affordable housing initiatives
It's time for inclusionary zoning, advocates say
11 FEB 2009 • by Bob Geary | INDYWEEK.COM

A task force appointed by the City Council wants Raleigh to become the first major city in North Carolina to employ inclusionary zoning as a way of boosting its supply of affordable housing.

Inclusionary zoning—which would require that large housing developments include some percentage of units affordable to low-income buyers—is a critical tool given Raleigh's worsening shortage of such housing, task force members and advocates say.

"The question is, are we going to include people of different income levels in all developments of a certain size?" asks Chris Estes, a task force member and the executive director of the N.C. Housing Coalition, an advocacy group. "Not doing so now has led to a variety of problems, including concentrations of poverty, lack of entry to jobs and the whole school reassignment issue."

A new housing analysis published by the Wake County Human Services Department shows roughly 46,000 Raleigh households (35 percent) are paying too much for their housing, using the generally accepted federal standard that housing should cost no more than 30 percent of family income. The main reason: There's not enough housing available at lower prices.

Most of those overpaying are renters with incomes below 50 percent of the median household income for the Raleigh-Cary metro area, which in 2006 was $69,800 a year. At the low end, for families with incomes below 30 percent of the median—$21,000 a year or less—the housing shortage is growing by some 1,300 units annually, according to the county's analysis.

The latter is a countywide figure, but other data in the study indicate that fast-growing Raleigh, which has accounted for about two-fifths of Wake's new housing this decade, is a major contributor to the affordable-housing problem, not the solution.

Lack of housing options has also hobbled Raleigh and the county's ability to serve a growing special needs population, including persons with mental, developmental and physical disabilities, according to the report. Some 10,600 such folks live in the county on incomes below the federal poverty level, which is $9,310 for a single person, $18,850 for a family of four—and most of them depend on services only available in Raleigh.

Thus the task force, created in connection with the development of a new comprehensive land-use plan for Raleigh, is preparing to recommend that the City Council take a series of aggressive steps, including:

Writing new zoning laws for transit-oriented development near commuter rail or bus stops, requiring "housing diversity and affordable housing choices."

Using incentives to encourage all new mixed-use developments, regardless of location, to be "mixed-income" as well.

Creating a new local funding source (a tax or impact fee) to help fund affordable housing—along with a land trust or other vehicle to assure that it remains affordable.

Targeting more of the existing funding—which includes federal housing funds as well as periodic city bond issues—to housing that's affordable at the lowest income levels, rather than to those at or near the $69,800 median.
The task force is chasing a moving target. When it met last week, it was still debating exactly how to word its recommendations, which are intended to be included in the comprehensive plan. Meanwhile, however, the comprehensive plan, issued in draft form in December, is being rewritten by the city's planning staff in anticipation of a public hearing March 3.

Task force members were divided on whether to call for "mandatory" or "voluntary" inclusionary zoning, but most were either in the first camp or else searching for a policy that would require results—actual affordable units in all large developments—without using red-flag words like "require" or "mandatory."

Their fear is that the City Council, which shelved an inclusionary zoning initiative by Councilor Thomas Crowder five years ago and has shown no inclination to take it up again, will reject any policy that seems to lean too hard on developers, especially in today's sad-sack economy.

"I'd like to see us make some progress on this issue," said member Gregg Warren, executive director of the Downtown Housing Improvement Corporation (DHIC), a city-supported low-income housing developer. "I think if we say 'mandatory,' we're going to get shot out of the saddle."

"As a builder, 'mandatory' to me means where else can I [build] where it isn't required?" member Richard Gaylord added. "It's something my heart wants to do, but my pro forma [financial statement] won't allow it."

On the other hand, Gaylord said, if Raleigh ties an inclusionary zoning requirement to incentives like density bonuses or other subsidies that would boost the returns to investors, not cost them money, they'd be better received.

According to Estes, most communities that have inclusionary zoning do just that, allowing builders to go taller or denser in exchange for including units they agree to sell at prices affordable (with payments of less than 30 percent of household income) to low-income buyers.

About 400 communities around the country have inclusionary zoning ordinances, but only a handful are in North Carolina. Davidson, the college town near Charlotte, was the first to adopt a mandatory ordinance in 2001. Chapel Hill has a non-mandatory program with guidelines that encourage developers to include 15 percent affordable units in rezoning applications, which are otherwise not likely to be approved.

"You can always work backwards," said Claude Trotter, a former city planning commission member, "but if we're not out there pushing for it"—an ordinance with teeth, that is—"you'll never get it." Trotter urged the group to "hold firm" for a mandatory approach.

One group that is pushing is Congregations for Social Justice (CSJ), a two-year-old coalition of 35 faith-based groups and 19 nonprofits in Raleigh that has made affordable housing one of its two top priorities. (The other is alternative, community-based corrections programs.)

Alan Reberg, a minister at Raleigh Mennonite Church and chair of CSJ's housing committee, has been a regular attendee at the task force meetings. CSJ helped persuade the City Council to create the task force; he thinks it's worked well, and should be succeeded by a permanent affordable housing commission that can advise the city on what an inclusionary zoning ordinance should say, and what else it should do to tackle a serious problem.

"With 46,000 households paying too much, I mean, good night!" Reberg said. "The shortages are horrendous, and the city and county do—I want to say they do a good job, but it's just woefully inadequate.

"And it's a job government can't do all by itself," he added, which is why an inclusionary policy is vital. "We need every segment of housing providers contributing, because no one sector is going to be able to pull it off."