denver’s housing strategies and revisions to the inclusionary housing ordinance robin kniech,...
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Denver’s Housing Strategies and Revisions to the Inclusionary Housing Ordinance
Robin Kniech, Councilwoman At Large
November 18, 2014
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Inclusionary Housing is just one tool in Denver’s Approach to Affordable Housing
• Homeownership
• “Workforce” or moderate affordability
Five Year Affordable Housing Plan
• Diverse set of strategies that will help build and preserve housing at all levels of affordability, including housing for the homeless and deeply affordable rental housing for seniors, low-wage workers, etc.
Other programs for affordable housing including the Revolving Loan fund, a tool to help close a financial gap for projects receiving federal tax credits, a down-payment assistance program to help qualifying homebuyers purchase in the Denver Metro Area, and a mortgage credit certificate program to help qualifying homeowners increase their usable income
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Denver’s Housing Plan
• 2 year stakeholder process, most significant updates since the ordinance was originally passed in 2002
• Stakeholder committee comprised of public sector representatives, and experts in real estate, finance, and housing development
• Two phases of ordinance revisions– Phase One adopted by Council in June 2013– Phase Two adopted by Council in August 2014
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Process to Revise Denver’s IHO
History of the IHO
What is the Inclusionary Housing Ordinance (IHO)?
• Adopted by City Council in 2002
• Created a unified affordable housing approach to address severe housing shortage of moderately priced homes
• Requires that all developments of thirty (30) or more detached for sale single family dwelling units and all for sale attached or multi-family projects of thirty (30) or more units include a minimum number of moderately priced units.
– Developer Requirement – 10% affordability– Restricted sale price– Income eligible buyers
NOTE: GVR and Stapleton have separate agreements that are not governed by this Ordinance, but they do receive subsidies through it
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IHO Basics
Who are the families
the ordinance was designed to help?
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Income Level 1 (person) 2 (persons) 3 (persons) 4 (persons)
100% AMI $53,700 $61,400 $69,100 $76,700
< 80% AMI < $42,950 < $49,100 < $55,250 < $61,350
Ordinance Revisions
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items in red indicate revisions
Both the Current and Revised IHO treat all neighborhoods the same when building on-site: 10% of Units Affordable*
* Wherever built in City, high cost structures with elevators allowed to sell affordable units at 95% AMI to compensate for higher construction costs.
2014 Ordinance Revisions
“Zones” for Cash-in-lieu or Incentives
Zones based on Need/Transit
Distribution:LOW = 25%MEDIUM = 60%HIGH = 15%
IHO Variation Based on Statistical Neighborhood Zone
Zone *Cash in Lieu *Cash Incentives
High 70% of Sales Price
$25,000per unit
Medium 50% ofSales Price (Existing)
$6,500per unit
(Existing adjusted by inflation)
Low 25% of Sales price
$2,500per unit
* Except within ½ mile of transit, which receives the medium incentive
Tiering Cash in Lieu and Incentives by Zones
IHO Variation Based on Statistical Neighborhood Zone
Cash In-Lieu Cash Subsidy
$2,500
$6,500
$20,000-$149,879
-$99,919
-$49,960
-$175,000 -$150,000 -$125,000 -$100,000 -$75,000 -$50,000 -$25,000 $0 $25,000 $50,000
-$175,000 -$150,000 -$125,000 -$100,000 -$75,000 -$50,000 -$25,000 $0 $25,000 $50,000
Low
Medium
High
More Flexibility to Get More Homes and/or Reduce Burden
Provide expertise and support to developers willing to explore other ways to build housing Denver needs than the 10% formula requirement. Could be on-site or off-site.
These “outside of the box” solutions could create better outcomes for all parties (developers, City, families needing affordable housing, etc.):
– Rental housing vs. for-sale
– Deeper affordability
– Fewer units but with more bedrooms
– Leveraging the Ordinance units with other projects/subsidies
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Ordinance Revisions
Denver City Councilwoman At-Large
Robin Kniech
(720) 337-7712
www.denvergov.org/robinkniech
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@kniechatlarge
Robin Kniech, Denver City Council At-Large