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2011 NC Planning Conference Development Recovery Incentives that Support Sustainable Development

2011 NC Planning Conference Development Recovery Incentives that Support Sustainable Development Asheville, NC Panel Discussion Shannon Tuch - Planning & Development Jeff Staudinger - Community Development Robert Griffin - Building Safety. Objectives & Goals.

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2011 NC Planning Conference Development Recovery Incentives that Support Sustainable Development

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  1. 2011 NC Planning Conference Development Recovery Incentives that Support Sustainable Development Asheville, NC Panel Discussion Shannon Tuch - Planning & Development Jeff Staudinger - Community Development Robert Griffin - Building Safety

  2. Objectives & Goals Fulfill City Council’s Strategic Goals • Affordable • Fiscal Responsibility • Job growth & Community Development • Green & Sustainable • Multi-modal Transportation Fulfill goals and objectives of numerous adopted plans • Comprehensive Plan • Affordable Housing Plan • Wilma Dykeman Riverway Plan • Economic Development

  3. Economic Forces & Response • 2008 – The economy collapses and lending markets freeze → Leads to a dramatic drop in development activity • 2008-2012 Permit Extension Act keeps permits alive • Planning functions shift from development activity to long range planning • Focus → How to support and incentivize development (Not just any development though . . .)

  4. Strategies • Grants • Low Interest Loans • Cost Sharing for Public Infrastructure • Fee Rebates • Increased Density Strategies focused on sustainable development projects only!

  5. Grants & Loans Jeff Staudinger Director of Community Development City of Asheville

  6. Land Use Incentive Grants Required elements • Energy Star Certification • Assume all legal costs if challenged • 20% equity participation by party requesting incentive • The proposed development must consist of two or more dwelling units • Inside city limits, within ¼ mile of the following major highways to the end of the City’s corporate limits

  7. Sustainability Area - Map

  8. Land Use Incentive Grants Public Benefit Points Green Building/ Energy: • Energy Star Certified 5 • HB Silver 10 • LEED Silver or HB Gold 20 • LEED Gold or HB Platinum 30 • LEED Platinum 40

  9. Land Use Incentive Grants Public Benefit Points Affordable Housing Must agree to 10 year affordability, with rents at 80% of area medium income: 10%+ affordable 10 20%+ affordable 20 30%+ affordable 30 40%+ affordable 40

  10. Land Use Incentive Grants Public Benefit Points Workforce Housing Must agree to 10 year affordability criteria for rents at 120% of area medium income: 25%+ workforce 5 50%+ workforce 10 75%+ workforce 15

  11. Land Use Incentive Grants Public Benefit Points

  12. Land Use Incentive Grants Public Benefit Points Mixed Use and Transit Orientation Includes a minimum 20% non-residential 5 Within the Sustainability Bonus area 10 Brownfield Redevelopment 15

  13. Land Use Incentive Grants Formula • This policy provides that every 10 points can earn one year of economic incentive. • Equivalent to city property taxes in excess of currently assessed taxes for one year annually applied. • Dated from the date of release of all occupancy permits and certification of all green building/energy standards designated for the project.

  14. Land Use Incentive Grants Formula • Every 10 points can also earn a 10% reduction in the following fees and charges: Zoning Permit, Building Permit, Driveway Permit, Grading Permit, Plan review fees and Water service connection fee. • This reduction is in addition to the existing fees rebated for affordable housing projects. • Affordable housing projects eligible for the 50% fee waiver are not eligible for additional fee waivers for points garnered for housing affordability, although they can benefit from the “green” additional points

  15. Land Use Incentive Grants Example Proposed mixed use/apartment project Riverside Dr. • 200 apartments (180,000 square feet) • 40,000 square feet commercial (office and retail) • Gold LEED • 10% (20 units) “affordable” housing • 25% (50 units) “workforce” housing

  16. Land Use Incentive Grants Example Threshold:  Minimum Energy Star  Eligible Area  20% Equity  Two or More Units

  17. Land Use Incentive Grants Example Green/Energy Benefit • 30 points: Gold LEED Housing Benefit • 15 Points: 10% affordable 25% workforce Mixed Use/Transportation Benefit • 10 points: 20% non-residential Sustainability Bonus Area Total Points: 55

  18. Land Use Incentive Grants Example • Pre-development Tax Value: $250,000 • Post-development Tax value: $25,000,000 • Pre-Development Annual City Tax: $1,050 • Post-development Annual City Tax: $105,000 Grant: $103,950 per year for 5.5 years: $571,725

  19. Land Use Incentive Grants Example Permit Fees: $250,000 Grant: 55% of eligible fees = $137,500

  20. Land Use Incentive Grants Example Total grant = $709,225 2.8% of development costs

  21. Affordable Housing Trust Fund Basic Stats • Created in 2000 • $7.7 million loaned • 751 affordable rental and homeownership units funded (672 Rental; 79 Homeownership) • 617 units have been completed

  22. Affordable Housing Trust Fund • $600,000 annual investment in prior years • $300,000 annual investment in each of past two years due to budget constraints • In FY 2010-2011, closed $600,000 in loans, for the production of 72 affordable units.

  23. Affordable Housing Trust Fund • Restructured in 2010 • Rental Housing highest priority • Single-family housing limited to construction loans only

  24. Affordable Housing Trust Fund Current Goals & Priorities: • Rental housing • Lower per-unit subsidies • Final planning and zoning approval • One-bedroom and efficiency (studio) units • Multi-family properties • Projects along transit corridors • Higher density and large-scale developments

  25. Affordable Housing Trust Fund Eligibility: • A minimum of 20% of the total project units must be affordable • Permanent Financing- The required period of affordability for all long term financing will be directly proportional to the loan term (i.e. Developers requesting a 20 year loan term will be required to keep rents affordable for 20 years).

  26. Affordable Housing Trust Fund Eligibility:

  27. Affordable Housing Trust Fund Terms: Loans are fully amortizing except: • Loans for rental housing restricted to families earning less than 60% of the area median income, and with rents affordable to that population, may be amortized at 0.00% interest or interest-only at 2% with principal deferred for up to 20 years. • Interest on construction loans may be deferred until the loan principal is due.

  28. Affordable Housing Trust Fund Terms: • All permanent financing for rental housing will be in the form of secured loans for a term up to thirty (30) years. • The Housing Trust Fund will not make grants, forgivable loans, or indefinitely deferred loans. • All construction loans will be due and payable 24 months from the date of closing.

  29. Affordable Housing Trust Fund Terms:

  30. Affordable Housing Trust Fund Housing Trust Fund website http://go.usa.gov/8tf

  31. Cost Sharing & Rebates Robert Griffin Director of Building Safety & Development Services Center City of Asheville

  32. Public Infrastructure: Water Two Options for Participation Option 1 50% rebate of water connection fees for “Green” projects • Tap & Meter for single family homes • Meter for Commercial projects (fees vary based on size of meter)

  33. Public Infrastructure: Water Option 1 Example: • Single Family - Tap & Meter = $2,303.00 Total rebate = $1,151.50 • Commercial 2” drop-in meter = $9,813.80 Total rebate = $4,906.90

  34. Public Infrastructure: Water Option 2 – Cost sharing for new public water line Infrastructure • Water is an enterprise fund and water revenue must be reinvested in water infrastructure • $200,000 of water fund money set aside every year, projects must compete for available funds • Development must meet 80 points from evaluation form • Must include 5 or more residential units • Minimum 20 year investment payback • 50% of infrastructure cost or $100,000, which ever is less

  35. Public Infrastructure: Water Option 2 Example: • New 70 unit apartment building • All units are “affordable”, scores 90 points on evaluation form • Requires new water line extension from main road along new road • New line estimated cost is $220,000 • City participation = $100,000

  36. Permit Rebates Two Types of Rebates Offered “Green” Rebates & “Affordable” Rebates

  37. Permit Rebates Green Rebates Upon issue of CO and verification: • Healthy Built Home = $100 • Energy Star Rating = $100 • Geo Thermal installation = $50 • Solar installation = $50 • Wind Generator installation = $50 • Storm water collection for yard sprinkler = $50 • Rebates are cumulative (withhold $75 for processing)

  38. Permit Rebates Affordable Housing Rebates Fees are paid in full with 50% rebated upon project completion (CO) & verification: • Applies to For-sale, Rental, and Rehab projects • Includes Building, Engineering, Sewer, Water, and Zoning fees

  39. Permit Rebates Affordable Housing Rebates – For Sale Units • Must meet NC State Building Code (manufactured housing included only if it is attached to a permanent foundation and titled as real property) • Sale Price Restrictions: 0 BR $115,000 1 BR $125,000 2 BR $145,000 3 BR $160,000 4BR $170,000 • Must provide copy of settlement statement and appraisal

  40. Permit Rebates Affordable Housing Rebates – Rental Units • Can be single family or multi-family • Set aside for tenants below 80% AMI • Requires affordability for a minimum of 10 years (monitored through a local, state or federal program)

  41. Permit Rebates Affordable Housing Rebates – Rehab Units • Applies only to single family or multi-family • All single family units must be verified to belong to those with an income below 80% AMI • Multi-family structures must include a minimum of 3 units that are occupied by tenants with an income below 80% AMI

  42. Density Bonus Shannon Tuch Assistant Director of Planning & Development City of Asheville

  43. Density Bonus • Named: “Sustainable Development Projects” • Offers increased density in exchange for affordable and/or green building. • Changed from a Conditional Use Permit application to a Use-by-right application. • Has eligibility requirements and includes mandatory and optional elements.

  44. Density Bonus Negotiated Process • Worked closely with the Mayor’s task force on Affordable Housing to develop concept and standards • Draft is shared with other stakeholders (Coalition of Asheville Neighborhoods) • Public hearing process provided input from CAN and the larger community – altered final product

  45. Density Bonus Eligibility Requirements • Project site must be located within 1/8 mile of key transportation corridors. • Must be a minimum of 5 units & must be energy star certified

  46. Density Bonus - Map

  47. Density Bonus – 1st Draft Map

  48. Sustainability Area - Map

  49. Density Bonus Mandatory elements • Good Neighbor Agreement • Design compatibility standards • Deed restrictions on affordable units • Certification of LEED or Healthy Built units • Parking • Building orientation & design • Pedestrian orientation/multi-modal features

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