Rule Change Would Make ‘Affordable’ More Affordable

By Andrew Gorosko

Planning and Zoning Commission (P&Z) members intend to update the town’s affordable housing regulations to bring the rules into compliance with recently revised state law, and thus decrease the local cost of  “affordable housing.”

If the P&Z makes the regulatory changes, the sale price of new affordable housing units for most of the eligible buyers would drop from approximately $146,600 to about $116,000.

“Affordable housing” is a technical term used by the state Department of Housing. A complex set of formulas is used to calculate affordability, and who is eligible to acquire affordable housing, based on income.

Community development director Elizabeth Stocker October 5 told P&Z members the town would benefit by changing its affordable housing regulations to comply with recently revised state laws on affordable housing.

“You should probably move forward now on these [regulations],” Ms Stocker said, adding that acting quickly on the changes is important.

P&Z member Lilla Dean said the revised state regulations are better rules than the town’s regulations.

P&Z member Heidi Winslow said the town is currently in “jeopardy” in terms of its affordable housing rules.

Ms Winslow said a developer could apply to the town to build affordable housing under the town’s current affordable housing rules, which require a lower percentage of affordable housing in affected residential complexes than the state rules now require.

Ms Winslow urged that the P&Z revise the town regulations soon to bring them into compliance with the state rules. After those changes are made, the P&Z could then refine its affordable housing rules, she said.

Past sale prices of affordable housing units to eligible buyers in town have been pegged at a maximum of approximately $146,600.

Under the terms of the new state law on affordable housing, which took effect October 1, the maximum sale price would drop to approximately $116,000, according to Ms Stocker.

The intent of the revised state law is to make affordable housing “more affordable,” Ms Stocker said.

The state’s affordable housing regulations apply to the sale prices of new units, the resale prices of existing units, and to rental prices.

Memorandum

Ms Stocker provided P&Z members with a proposal for changes to the town’s affordable housing regulations.

If the town rules are changed to bring them into compliance with the state rules, the town rules would then require that 30 percent of the units in an affected housing complex be set aside as affordable housing, compared to the current 20 percent set-aside requirement.

The new rules would preserve the “affordable” status of the units for 40 years, instead of the current 20 years.

 The new regulations would require that at least 15 percent of the designated affordable units be set aside for persons and families whose income is at or below 60 percent of the area median income, and that the remainder of the affordable units be set aside for those people whose income is at or below 80 percent of the area median income.

The new regulations also would change the definition of “median income,” so that the lesser of the “area median income” or the “state median income” is used in calculating local affordable housing prices.

Affordable housing regulations typically provide developers with a financial incentive to create affordable housing, known as a “density bonus.”

Such a density bonus allows developers to build housing units at a higher construction density than normal, provided that a specified percentage of housing units is designated as “affordable housing.”

Affordable housing units are sold to buyers who meet income eligibility requirements at sale prices which are lower than prevailing market prices.

The Borough Zoning Commission does not have zoning regulations on affordable housing.