Inclusionary zoning could bring more affordable housing to Athens

UPDATE (4/5/2022): The mayor and commission passed the inclusionary zoning policy described below unanimously.

The mayor and commission is considering a policy called “inclusionary zoning” which would encourage developers to build more affordable housing in Athens. This policy, if passed, would change Athens’ zoning code to provide incentives for developers to include some affordable units in new apartment complexes.

How inclusionary zoning works

Athens wouldn’t be the first city in Georgia to take this approach to help keep rental prices affordable. Cities like Atlanta and Decatur already have inclusionary zoning ordinances which actually force developers to include 10% or more affordable units in new developments in some areas (such as the Beltline). 

Mandatory inclusionary zoning like this might be straightforward and effective, but since state law prohibits rent control of any kind, it’s probably illegal. We don’t yet know if these ordinances will hold up in court, but the ACC Planning Commission decided to play it safe by proposing an entirely voluntary program for Athens.

Benefits for developers

If passed by the ACC Commission, Athens’ voluntary inclusionary zoning program will come with some major perks for developers. For example, participating developers would be allowed to build more housing units per acre of land than normally allowed in our zoning codes. The density bonus is quite large (50% in most zones as shown in the chart below), so that could be a big boost for their profit margins.

Another perk of participation is that developers would be allowed to build 20% fewer parking spaces than otherwise required, as long as the new development is within 1,500 feet of an Athens Transit bus stop. Finally, apartment complexes in the downtown area would be allowed to allocate less space on the ground floor to commercial uses than they’d be otherwise required.

Developers who don’t want to build affordable housing could still gain advantage of these benefits by paying into an affordable housing fund. To gain the benefits, they’d have to pay between $135,000 and $165,000 for each affordable unit they would have been required to build. The local government would then use the money to construct affordable housing themselves, and the developer would be free to take advantage of the various perks, including building at a higher density. 

However, paying into the fund would only be an option for potential developments in the downtown commercial zone as the proposal currently stands.

Benefits for Athens

In exchange for the benefits listed above, developers would pledge to keep some of the units in their new apartment complex “affordable” for at least 20 years (or to the longest period the commission could legally require – this is still being researched). According to the US Department of Housing and Urban Development, “affordable” housing is defined as costing at most 30% of the tenants’ income.

The inclusionary zoning policy under consideration would require that rents in affordable units be kept affordable for those making at most 80% of Athens-Clarke County’s area median income for at least 20 years. They might even be required to go as low as 60% of the area median income, depending on how many affordable units they build. If only 10% of the units in a participating development are affordable, then they must be affordable for someone making only 60% of the area median income (i.e. someone with very low income). If at least 15% of the units are affordable, then they would be allowed a lower level of subsidy and could be kept affordable only for those making 80% of area median income.

In general, the deeper the subsidy developers offer, the fewer affordable units they would be required to build.

Only tenants with income in this range (or lower) would be allowed to rent the units. The owner of the complex would be responsible for verifying the income of prospective tenants, which would be reassessed yearly to see if they continued to qualify for the program. Owners would not be able to reveal this information to anyone. Also, no discrimination against tenants in the affordable units would be allowed; these units would be identical to and would have the same access to amenities as those elsewhere in the complex.

Commissioners discuss

There was broad agreement among commissioners on the inclusionary zoning proposal at their meeting last Tuesday. This proposal also comes unanimously recommended by the ACC Planning Commission, who worked for over a year in coordination with Commissioners Mariah Parker and Tim Denson to craft the proposal. No commissioner spoke in opposition to the plan, and some strongly praised the idea.

“This is a significant step for us to take in terms of addressing affordable housing,” Commissioner Carol Myers said.

Mayor Kelly Girtz agreed, saying “everyone who worked on this deserves a gold medal.”

But that doesn’t mean there wasn’t any disagreement on the finer details of the proposal. Parker, for example, wanted to let developers in any zone pay into the housing fund in lieu of actually constructing the affordable housing themselves, not just those in the downtown zone. Parker said that having local government control over the housing fund would give them more flexibility and would allow affordable housing to be constructed in a more democratic way.

Denson, on the other hand, wanted to keep the responsibility of constructing affordable housing on the shoulders of developers, rather than giving them an option to make payments in lieu of construction. He said that building housing as a government would be a more complex task and would slow down the goal of providing an affordable place to live. “The easiest way to produce affordable housing is to have the folks who are building it, to go ahead and build it,” he said.

Despite his strong support for the program, Denson acknowledged that the proposal “is not perfect.” He stressed that the concept would be reevaluated on a yearly basis and could be updated to make it more effective in the future. Nevertheless, he maintained that it was important to pass this version as soon as possible.

“Because of how many potential developments are waiting in the wings… we needed to move quickly to get something that was ready to go,” Denson said, referencing the many apartment buildings being planned for construction in Athens.

In recent years, the commission has been negotiating with every developer on an ad hoc basis to try and get some affordable housing included in new developments. This proposal, if passed, would standardize and streamline those negotiations.

Next steps

The vote on the inclusionary zoning proposal was scheduled for March but had to be delayed until April because a required legal notice was not printed in time.

This error didn’t bother Commissioner Melissa Link, who is grateful for the extra time because of how important she feels this proposal is. “I feel like we as a body need to have multiple conversations about it and really dig into it. It’s something that’s so important that we all need to give it our full attention,” Link said. “This is work that should have started six, eight or ten years ago. It’s something I had been begging for under the previous administration.”

Heather Benham, Executive Director of the Athens Land Trust, told APN that while she agreed the proposal was ”a great first step,” she wanted to see more work being done to make home ownership more affordable as well. The current proposal only affects multi-family developments like apartment complexes. However, Denson says the commission will be expanding their work on affordable housing to include home ownership soon.

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