Despite clamor for more units in exchange for increased density, watered-down Affordable Housing Incentives ordinance reaches city council

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This week the City Council will be briefed on the Mendenhall Administration’s latest revisions to incentivize residential developers with increased units in exchange for a portion of those homes being rented (or sold) below market rate.

Achieving the right weight on the scales so that regulatory incentives can produce public goods like affordability within a market rife with incentives to maximize profit on tight margins is delicate, complex, and perhaps futile.

The City Council will get their hands on the levers at Tuesday afternoon’s work session on the Affordable Housing Incentives ordinance.

Their discussion will likely reveal whether the council’s seven members consider sufficient the latest terms hammered out by the Administration after public comment and stakeholder feedback.

Among those revisions are concessions to both neighborhood preservationists and developers. Affordable housing advocates look the losers.

What’s new?

First, take a look at our review from this June.

Here’s how the City Council’s Staff report presents the updated incentive and reward structure:

Make sure to page through the two slides. The second shows the requirements for the large majority of city zones.

As it reads, the categories are: 1) Type A: single-family zones, 2) Type B: RMF-30 (recently rewritten) and other largely irrelevant RMF zones which are currently being phased out (-35, -45, -75), and 3) Type C: Every other zone. Yes, every other zone.

In all those zones, the affordability requirements for added density will be at most 20% of the units at 80% AMI. As the Administration’s staff report notes, “we had to decrease the percentage of affordable units in most categories.”

In addition, properties in Institutional zones will be allowed to build single-family homes and duplexes. Not quite like California’s recent YIGBY (Yes In God’s Back Yard) legislation, which permits multi-family housing on church property as long as 100% of its units are below market rate.

Imagine if LDS stake center and ward house parking lots were 100% affordable housing. This is the 33rd Ward at 453 S. 1100 E. in Salt Lake City.

And in a reversal—a likely concession to “neighborhood character” activists—existing front-, side- and rear setbacks will be retained—as well as current lot coverage maximums.

The requirements for setbacks and front yards are the average of the existing setbacks on the block face (R-1 and Foothills), and 20’ in RMF zones.

Side yards in R-1 are mandated at 4’ on one side and 10’ on the other, allowing a driveway for cars. In RMF, they are 10’.

Parking minimums for single-family zones, previously at one per unit if the property was not located within a quarter mile of transit, have been eliminated.

What’s fair, what’s effective?

In all the categories other than R-1, Foothills, and RMF, the options to satisfy the affordability requirements through combinations of 5 or 10 percent of the units at “deeper affordability” are multiple.

Is that effective public policy?

If a developer can now build a four-plex in a single-family zone on the condition that one of those units is offered at 80% AMI, is that a sufficient public good in exchange for the increased value for a property owner?

The Planning Commission and City Council received strong and repeated demands from affordable housing advocates to increase the percentage of affordable units in the incentive formula.

But Planning’s latest report offers the opposite. In discussion with their stakeholder group, “Staff and members of the development community presented information on the feasibility of the existing incentive proposal and the viability of requiring more deeply affordable units and/or a greater percentage of affordable units. “

As a result, in the newest proposal, “Options for a lower percentage of more deeply affordable and larger units are provided.”

This, despite Planning acknowledging in its materials that public feedback encouraged more affordable units be required in the deal.

Administration and enforcement

A number of questions raised by City Council staff revolved around the need for increased staff to administer a program serving both renters and property owners.

For renters, Does the city want to become a resource, a clearing-house of sorts, for people looking for affordable housing? Notably, a comprehensive listing of below-market-rate rental units in Salt Lake City or Salt Lake Valley doesn’t seem to currently exist.

On the enforcement side, How to make sure property owners benefitting from the program are delivering the public goods that the law requires?

Both outsourcing functions and increasing internal capacity at City Hall are on the table. Planners are recommending yearly self-certifying by property owners of their affordable units and tenants.

You can link to the city’s materials and Tuesday’s City Council meeting here.

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Posted by Luke Garrott

Luke Garrott, PhD, has published in The Salt Lake Tribune and the Deseret News, and written features for the Salt Lake City Weekly City Guide and The West View. A former two-term councilman in Salt Lake City's District 4, he lives in Downtown Salt Lake City and grew up in the Chicago area.