Nuts and Bolts of Inclusionary Housing (Part I)

Let's get down to basics: Should your jurisdiction adopt an inclusionary housing ordinance, and if so, how? This workshop examined the factors you should consider when deciding whether to adopt an inclusionary housing ordinance and the questions you must address if you decide to create one. Should the program be mandatory or voluntary? How do you choose the threshold number of units to trigger the ordinance? What should be exempt from the ordinance? Who should the target market be? How do you ensure long term affordability? Should you have an in-lieu provision? How do you implement a program? How do you build broad-based support for inclusionary housing?

Jacky Morales-Ferrand, Director of Housing and Neighborhood Development City and County of Denver, Colorado
Christopher Anderson, Manager, Single Family Housing Programs Montgomery County, Maryland
Susannah Levine, Senior Policy Analyst Business and Professional People for the Public Interest Chicago, Illinois
Steve Sanders, Interim Director, Land Use, Housing and Environment Program Institute for Local Government Sacramento, California

Getting Started: The Inclusionary Housing Campaign

Getting an inclusionary housing policy adopted requires the commitment of a diverse set of community actors. This workshop featured several cities that are waging or have recently won comprehensive, multi-faceted inclusionary housing campaigns. Prominent advocates from those cities discussed effective strategies for education and outreach and how to build a campaign that will generate "buy in" among the broadest set of stakeholders.

Adam Gross, Director, Regional Affordable Housing Initiative Business and Professional People for the Public Interest Chicago, Illinois
Amanda Brown-Stevens, Field Director Greenbelt Alliance San Francisco, California
Cheryl Cort, Policy Director Coalition for Smarter Growth Washington, DC
Bibi Hidalgo, Housing Director Citizens Planning & Housing Association Baltimore, Maryland

Making it Work for the Developer

"It just doesn't pencil out." The most common complaint regarding inclusionary housing ordinances is that they place too great a burden on developers. But if inclusionary housing doesn't work for developers, it doesn't produce affordable units. That's why nearly all inclusionary housing ordinances offer developers benefits that help offset the cost of providing affordable units. Top professionals discussed the variety of tools available for making inclusionary housing work for the developer, such as density bonuses, expedited permitting, fee waivers, and regulatory reform. They shared developer's perspective on how to make an inclusionary housing ordinance work well. Conference participants discovered why some for-profit developers are among inclusionary housing's most ardent advocates.

Douglas Moritz, President DOMO Consulting Washington, DC
Craig Adelman, Vice President for Affordable Housing AF Evans Development, Inc. Oakland, California
G. Allan Kingston, Principal Kingston Advisors Culver City, California
Linda Mandolini, Executive Director Eden Housing Hayward, California

Building Effective Coalitions

A wide range of groups has an interest in inclusionary housing, from housing advocates and faith-based groups to large public- and private-sector employers. But to turn that interest into political support, you need to build an effective coalition. Participants learned techniques for bringing together a diverse alliance of interests to win a campaign founded on principled consensus, and troubleshoot the challenges that inevitably emerge with leaders who have been through -- and succeeded in -- the process.

Dwayne Marsh, Associate Director PolicyLink Oakland, California
Cheryl Cort, Policy Director Coalition for Smarter Growth Washington, DC
Tom Walsh, Coordinator Balanced Development Coalition Chicago, Illinois

Administration of an Inclusionary Housing Ordinance

You got an inclusionary housing ordinance on the books! Congratulations. Now the rest of the work begins. Administering inclusionary housing can be complex and time-consuming. Experienced administrators discussed what to anticipate, pitfalls to avoid, and partnerships that can make it easier.

Rick Jacobus, Partner Burlington Associates in Community Development Oakland, California
Bonne Gaebler, Housing Administrator City of Petaluma, California
John Payne, Acting Deputy Director Department of Housing and Community Development Fairfax County, Virginia
Annabel Yurutucu, Housing Officer City of Sunnyvale, California

Withstanding Legal Challenge

The last thing you want to do with your inclusionary housing ordinance is slog through defending it in court. But you can improve your odds by drafting an ordinance that takes into account the most common legal challenges. Legal experts discussed how to protect against takings and equal protection challenges. They also covered other legal issues such as enabling legislation, nexus studies, waivers, and fee-in-lieu provisions.

Conference Handouts
Nicholas Brunick, Attorney Applegate & Thorne-Thomsen, P.C. Chicago, Illinois
William Kennedy, Managing Attorney Legal Services of Northern California Sacramento, California
Kevin Walsh, Associate Director Fair Share Housing Center Cherry Hill, New Jersey

Inclusionary Housing Design and Production

Developers are often reluctant to include affordable housing in market rate developments because they aren't comfortable producing a product that is outside their usual design and production parameters. This session provided examples of how affordable housing can be designed to fit aesthetically within market-rate developments and identify pitfalls to avoid.

John Payne, Acting Deputy Director Department of Housing and Community Development Fairfax County, Virginia
Peter MacKenzie, Partner David Baker + Partners Architects San Francisco, California
Terry Eakin, Chairman EYA, LLC Bethesda, Maryland

Affordable to Whom? Target Market and Price Points

How much good has an inclusionary housing ordinance done if most of the local workforce can't afford the units it generates? Determining whom an inclusionary housing ordinance will serve can be as complicated as it is critical. How do you decide who to house? How do you serve your target market while ensuring that developers are not unfairly penalized? How do you settle on an income mix that will create and sustain strong, successful communities? Experts from around the country addressed these difficult questions.

Bernie Tetreault, President Innovative Housing Institute Baltimore, Maryland
Valerie Feldman, Attorney Legal Services of Northern California
Art Rodgers, Senior Housing Planner Washington, DC Office of Planning
David Rusk, Affordable Housing Consultant Washington, DC

Balancing Affordability and Wealth Creation

Inclusionary housing ordinances can produce vital community assets and valuable personal assets. Should the programs seek to preserve these community assets, or allow residents of the affordable units to reap the full rewards of homeownership? This session examined various techniques for balancing these two important goals, including resale provisions that utilize shared appreciation formulas and community land trusts.

Carla Robinson, Research Director National Housing Institute Montclair, New Jersey
John Davis, Visiting Fellow, Lincoln Institute of Land Policy; Partner Burlington Associates in Community Development Burlington, Vermont
Dev Goetschius, Executive Director Housing Trust of Sonoma County Petaluma, California
Myrna Melgar, Director of Homeownership Programs San Francisco Mayor's Office San Francisco, California

In-Lieu Fees and Alternatives to Providing Affordable Inclusionary Housing Units On-Site

Inclusionary housing ordinances sometimes provide developers with alternatives to building affordable housing on-site. This session reviewed a few of those options, but focused primarily on the in-lieu fee. Prominent professionals examined when in-lieu fees are appropriate and how to calculate and use them. They also discussed whether an in-lieu fee is a "backdoor impact fee" and if so, how to adopt one that can withstand a legal challenge.

Douglas Porter, President Growth Management Institute Chevy Chase, Maryland
Elizabeth Davison, Vice President Robert Charles Lesser & Co. Bethesda, Maryland
Janet Smith-Heimer, Managing Principal Bay Area Economics Emeryville, California

Finding the Money for Deeper Affordability

Financing affordable housing is always a challenge. Financing projects that serve lower-income households is even trickier. Private developers and a not-for-profit organization told how they pulled it off together, using tax-exempt bonds, low-income housing tax credits and "soft second" sources of financing. They discussed ownership structure, types of units, acquisition phase and permanent phase financing, private placement versus credit enhancement for bonds, gap financing, cash flow rental assistance, and the economic and public purpose benefits to governmental and not-for-profit agencies.

Margo BeVier Stern, Esq., Partner Ballard Spahr Andrews & Ingersoll, LLP Washington, DC 202-661-7620
David Jefferson, Executive Director Rockville Housing Enterprises Rockville, Maryland
Beth Mullen, Office Managing Principal Reznick Group, P.C. Sacramento, California

Integrating Inclusionary Housing in Smart Growth and New Urbanism Projects

Affordable housing is a key tenet of smart growth and new urbanism. But with the exception of HOPE VI projects that require both new urbanism design and affordability, there are few examples of new urbanism that include affordable housing. The reason for this is a lack of inclusionary housing policies to require affordability at the front end or inadequate policies to maintain affordability. This session focused on why and how inclusionary housing ordinances should apply to new urbanism development and all smart growth initiatives and provided examples of how it can be done.

Jaimie Ross, Affordable Housing Director 1000 Friends of Florida Tallahassee, Florida
Shelley Poticha, President and Chief Executive Officer Reconnecting America Oakland, California
Doug Porter, President Growth Management Institute Bethesda, Maryland

Plenary Session: The California Experience

The state of California has been a laboratory of inclusionary housing innovation and experimentation. More than 100 jurisdictions have adopted inclusionary housing ordinances in diverse market contexts and some programs have been in place for many years. During this plenary session, conference participants heard about the significant role that inclusionary housing has played in promoting housing affordability, creating and maintaining vibrant neighborhoods, reducing traffic gridlock, and strengthening families and communities. They also learned about problems programs have encountered and the steps that have been taken to address legal and implementation challenges.

Kalima Rose, Senior Director PolicyLink Oakland, California
Nico Calavita, Professor Graduate Program in City Planning, San Diego State University San Diego, California
Fran Wagstaff, President Mid-Peninsula Housing Foster City, California
Rob Wiener, Executive Director California Coalition for Rural Housing Sacramento, California

Inclusionary Housing in the Urban Context

Cities and other urbanized areas can present special challenges for inclusionary housing programs. How can you integrate affordability into major redevelopment plans? How can lower-income residents pay monthly and special assessments for condominium units? How do you create affordable units in high-cost high-rise construction projects, especially where cost offsets like density bonuses may not be a viable option? Does inclusionary housing require a different approach in weaker housing markets? Where there's a will, there's a way. Key players from San Francisco, Baltimore and New York City discussed how their cities have adopted winning strategies to address these thorny issues.

Rafael Cestero, Senior Vice President'Enterprise Community Partners, Inc.'New York, New York
Bibi Hidalgo, Housing Director'Citizens Planning & Housing Association'Baltimore, Maryland
Doug Shoemaker, Deputy Director Mayor's Office of Housing City and County of San Francisco, California

Affordable Housing Research Trends

Inclusionary housing programs seek to create stable mixed-income neighborhoods. But research suggests that it is very difficult to create such neighborhoods. What does research tell us about local, state and federal efforts to support mixed-income communities and maintain affordability for the long-term? Two of the nation's foremost housing researchers discussed the impact of zoning and other regulations on the cost of housing and the racial composition of neighborhoods, and the impact of and benefits for families of programs and policies aimed at creating mixed-income communities.

Erika Poethig, Program Officer MacArthur Foundation Chicago, Illinois
John Quigley, Professor Department of Economics, University of California Berkeley, California
Margery Turner, Director, Center on Metropolitan Housing and Communities The Urban Institute Washington, DC

Regional and State Approaches

Inclusionary housing is an invaluable local policy. But it can be even more powerful if it is part of a broader state or regional effort to address affordable housing needs. California, Florida, New Jersey, and Illinois have taken steps to push all local jurisdictions to address regional housing needs. There are also interesting region-wide efforts to address affordable housing needs. Policy experts and practitioners discussed the importance of regional and state efforts that can maximize the impact of inclusionary housing programs.

Nicholas Brunick, Attorney Applegate & Thorne-Thomsen, P.C. Chicago, Illinois
Geeta Rao, Policy Director Non-Profit Housing Association of Northern California San Francisco, California
Jaimie Ross, Affordable Housing Director 1000 Friends of Florida Tallahassee, Florida
Kevin Walsh, Associate Director Fair Share Housing Center Cherry Hill, New Jersey

New Research on Inclusionary Housing

Inclusionary housing debates can be contentious and divisive, with advocates on both sides sometimes staking out extreme positions. Opponents argue that it produces little affordable housing and reduces the supply and drives up prices of market-rate homes. Supporters, on the other hand, sometimes promise more than they can deliver. As is often the case, the reality is much more complex. Eminent researchers shared the latest findings on the impacts of inclusionary housing and discussed what they mean for your community.

Jeffrey Lubell, Executive Director Center for Housing Policy Washington, DC
Nico Calavita, Professor Graduate Program in City Planning, San Diego State University San Diego, California
Paul Peninger, Research Director/Co Policy Director Non-Profit Housing Association of Northern California San Francisco, California
David Rusk, Affordable Housing Consultant Washington, DC
Jenny Schuetz, Research Fellow Furman Center for Real Estate and Urban Policy, New York University New York , New York
Robert Wiener, Executive Director California Coalition for Rural Housing Sacramento, California