The topic of affordable housing has been discussed for years in our city.
Recently, a consulting firm conducted a housing study in Naperville from which the City Council reviewed the findings in their September 2020 Affordable Housing Workshop – and now, are looking to hire a consultant to spearhead getting systems in place to meet the recommendations of the plan.
To ensure the business community voice is incorporated into this discussion, the NACC convened a roundtable discussion last month and is moving forward with a smaller working group to examine this complex and often controversial issue through many lenses of stakeholders, including those of real estate developers and their attorneys, real estate financing organizations, our school districts, and nonprofits who serve lower income families.
A term that is often associated in the discussions of affordable housing is inclusionary zoning ordinance or “IZO.” Inclusionary zoning ordinance (also known as inclusionary housing) refers to municipal and county planning ordinances that require a given share of new construction to be affordable by people with low to moderate incomes. The intent of IZO is to ensure that, moving forward, municipalities will have a systematic method of creating more housing stock for low to moderate income families. The complexities around an IZO are the questions of what is a reasonable number of units to require being designated as affordable housing based on a given real estate development plan. In addition, should incentives be offered to developers that offer affordable housing units voluntarily (such as height, density, and setback variances) instead of mandating designated housing units through an IZO?
Many municipalities offer a “fee in-lieu” clause in an IZO – which, simply put can provide an avenue for the real estate developer to pay additional funds toward supporting affordable housing programs/developments elsewhere in the city without having to provide the affordable housing component to their proposed development design. Complexities for this alternative include how the formula for this fee gets calculated. Will “fee in-lieu” be offered on all developments approved by the city or those developments meeting set criteria, and if that is the case, what does that criteria entail to be equitable?
There are cities around the country that boast of affordable housing ordinances increasing the available housing offerings to low or moderate income residents, while continuing to cultivate real estate development investment in their area. Other areas report that poorly designed IZO plans decimated real estate investment in their area. It is an important decision that we must get right.
The Naperville Area Chamber of Commerce will continue to tackle this complex issue by continuing to convene stakeholders, offer forums, and formulate position statements for city council to ensure real estate developers continue to invest in our community while ensuring that our diverse community continues to thrive.
If you want more information on the IZO and affordable housing discussion, or other policies impacting our business community – please reach out.
