Atlanta Development Authority to Push Inclusionary Zoning in Atlanta
With additional reporting by Matthew Charles Cardinale
(APN) ATLANTA — At the July 21, 2014 Work Session on Affordable Housing, convened by Atlanta City Councilman Andre Dickens (Post 3-at-large) on behalf of the Community Development/Human Resources Committee, the Atlanta Development Authority (ADA, doing business as “Invest Atlanta”) announced its intentions to advocate for Inclusionary Zoning in Atlanta.
Inclusionary Zoning (IZ) is one of several recommendations that came out of a new report, “A Housing Strategy for the City of Atlanta,” authored by HR&A Advisors and Enterprise, Inc.
IZ is a market-based policy that has been adopted to address affordable housing challenges in cities and counties across the U.S., and has led to the development of thousands of housing units.
Some examples of jurisdictions that have a mandatory IZ policy include Boston, Massachusetts; Montgomery County, Maryland; Seattle, Washington; and Washington, D.C..
The basic premise of IZ is that in areas covered by IZ policies, developers of multifamily affordable housing must include a certain percentage of affordable rental units in their developments.
“We want to talk about a subject that a lot of people don’t want to talk about, which is Inclusionary Zoning, and so that was something we really want to talk about in this session, because we think that is something everybody has shied away from,” Dawn Luke, Managing Director of Housing Finance for the ADA, said.
“But in some parts of town, there is not enough money to incentivize, so you have to do it in other ways, and that’s one of the policy decisions we talked about,” that the Council will have to make, Luke said.
“We’re looking at… inclusionary housing policy, how can we move forward with inclusionary housing policy for consideration here within the City of Atlanta. We, in the Department of Planning and Community Development are currently looking at a rewrite of our zoning ordinance, so as a part of that Invest Atlanta will submit a proposal to the City for consideration for looking at Inclusionary Zoning,” Terri Lee, Deputy Commissioner, Department of Planning and Community Development for the City of Atlanta, said.
Councilmembers present at the Work Session were Chairman Dickens, Ivory Lee Young (District 3), Cleta Winslow (District 4), Felicia Moore (District 9), CT Martin (District 10), Joyce Sheperd (District 12), and Mary Norwood (Post 2-at-large).
Presenters included Luke; Lee; Derrick Jordan, Interim Director, Office of Housing, Department of Planning and Community Development for the City of Atlanta; and H. Granvel Tate, Principal, 1025 Advisors, Inc.
“Affordable Housing is a critical issue for the sustainability and livability of Atlanta. I called the Council Work Session to help us gain a common understanding of the successes, challenges, and opportunities we have to ensure Atlanta continues to be an affordable and wonderful place to live. The meeting showed how the Office of Housing and Invest Atlanta are currently collaborating for a Housing Strategy that works,” Councilman Dickens told Atlanta Progressive News.
The report found that more than thirty percent of Atlanta households earn less than 25,000 dollars per year; and 23 percent of Atlantans live in poverty.
The report also found that tens of thousands of Atlanta households are cost-burdened, meaning that they pay more than thirty percent of their income towards rent.
This includes more than 25,000 renter households subsisting on 20,000 dollars or less per year; about 13,000 renter households making between 20,000 and 34,999 dollars per year; and 5,000 renter households making between 35,000 and 49,000 dollars per year; about 2,000 renters households making between 50,000 and 74,999 dollars per year; and a couple hundred renter households making more than 75,000 dollars per year.
The total number of cost burdened households includes is approximately 75,000, according to the report. And the greatest need is to provide for housing units that are affordable to families making 20,000 dollars or less per year.
The report also found that the number of Atlanta residents who are housing cost burdened has increased significantly since 2000; that over the last twenty years, housing prices have grown faster than incomes; and that currently in Atlanta, the lowest cost housing is concentrated in neighborhoods with the fewest jobs.
The Housing Strategy report listed several public policies that would be required to implement the Housing Strategy:
– Changes to TAD [Tax Allocation District] Policies to require developers to create workforce housing;
– Priority tax lien purchase for the LBA [Land Bank Authority]
– Tax incentives for affordable housing development
– New zoning incentives and requirements based on proven models in other cities
– Inclusionary Housing policy that requires all new residential developments to have affordable/workforce housing component
“Workforce housing” is a term sometimes used in the place of “affordable housing,” but among Atlanta’s powers that be, it is typically used to refer to housing affordable to nurses, teachers, and firefighters, but not baristas, waiters, and sales associates, despite the fact that the latter are, in fact, part of our workforce.
The ADA has a tendency to support what they call “workforce housing,” which means affordable at 80 percent AMI, even though the greatest need is with families making 30 percent AMI and below.
The Housing Strategy also calls for new funding sources, noting that many of the existing funding sources for affordable housing have been shrinking [such as federal dollars], while other sources have been completely or nearly depleted [Housing Opportunity Bonds, Beltline Affordable Housing Trust Fund].
These funding sources include:
– New issuance of the successful Housing Opportunity Bonds
– Funding to increase LBA (Land Bank Authority) capacity to acquire and rehabilitate vacant, blighted properties
– Creation of Housing Trust Fund from a variety of sources [payment in lieu of, dedicated millage, per unit levy]
The Area Median Income (AMI) in Atlanta is 46,000 dollars, although the AMI for the Metropolitan Atlanta area is 64,000 for a family of four, according to the report.
According to the report, a single person making up to 13,500 dollars per year would still make less than 30 percent of Metro AMI for a one-person household. By APN’s analysis, that person could spend 375 dollars per month on housing.
A single person making up to 22,550 dollars per year would still make less than 50 percent of Metro AMI for a one person household, and could afford to pay 625 dollars per month on housing.
A single person making up to 27,060 dollars per year would still make less than 60 percent of Metro AMI for a one person household, and could afford to pay 752 dollars per month on housing.
A single person making up to 34,050 dollars per year would still make less than 80 percent of Metro AMI, and could afford to pay 946 dollars per month on housing.
According to Tate, there is a growing disparity in Atlanta between market rate rental costs and what Atlantans are able to afford.
Tate pointed to the report, which noted that some new housing being brought online in the Old Fourth Ward–likely the old City Hall East development, Ponce City Market–is even higher than the current market rate.
The market rate for a studio apartment in Atlanta is currently 955 dollars, and thus is more than even a single person making 80 percent of AMI on housing could afford without being cost burdened.
Ponce City Market studio apartments are renting for 1,130 dollars per month.
During the Work Session, it was also revealed that the Fulton County Development Authority has been undercutting the ADA on lease purchase bonds because the ADA requires “workforce” housing to be included, whereas the FCDA does not require an affordable housing component.
Because of Fulton County’s tax abatement policies, allowing a 50 percent reduction in property taxes that increases over a ten year period, developers will almost always seek out an abatement through the county rather than utilizing the ADA.
The Housing Strategy’s goals include: to increase Atlanta’s population by ten percent; reduce the number of families who are cost burdened by ten percent; reduce the number of vacant blighted structures by ten percent; produce or rehabilitate 10,000 residential units for a range of incomes; generate 100 million dollars for affordable housing construction or rehabilitation; and ensure 10,000 new units meet sustainability standards.
“The Work Session solidified something we observe daily which is that there are a lot of new housing units being developed near job centers but they don’t have enough–sometimes no– affordable units planned,” Dickens told APN.
“Lastly, another outcome of the work session was that citizens, developers, and government, need to know that the face of those in need of affordable units includes hardworking people like teachers, city employees, as well as police and fire personnel,” Dickens said.