Could a little relief be coming to Fredericksburg renters?
The city is in the early phases of considering a Density Bonus Program, which would permit developers the ability to build more units than zoning allows in exchange for including a proportional number of affordable units for “low-income” households. The state of Virginia sets that ratio of market-price to affordably-priced units that localities can offer developers under these programs.
According to Planning Commission member Adam Lynch, the city’s staff is currently eyeing the 17% affordable units / 30.5% density bonus option.
If enacted, a hypothetical 100-unit development would be allowed (by-right) to build 30 additional market-price units if the developer agrees to make 17 other units available for an “affordable” rent, which in this case would not exceed 30% of the median income, including utilities.
In this instance, “low income” is defined as any household (either individual or family) with an annual income 80% or less of the area median where the development is proposed. The state also sets those prices for a minimum of 15 years and up to a maximum of 50, giving pricing control to local governments and housing authorities. Virginia offers a different table of density bonus program rates for “very low-income” households at 50% or less of the area median income.
The Density Bonus Program may be new, but the approach isn’t.
In 2019, Mitchell Properties voluntarily included four affordable apartments in their 24-unit Hanover House complex on Sophia Street in exchange for a special exception permit for the building’s height, floor plan, commercial space and residential density. That includes a studio, one bedroom and a pair of two bedroom units as “affordable” to those making 50% of the area median income (or very low income, as defined by the state).
Developers are allowed to offer a number of affordable units on a proposed development, but staff is prohibited from directly asking or conditioning the approval based on any promise of affordability.
What makes a density bonus program different than the existing tax credit / low income communities around town?
Eligibility.
The purpose of density bonus programs is to provide affordable options to working class households at 80% of the median income, where tax credit communities are required to rent to households at much lower income percentages relative to their area.
Density bonus programs date back to 1961, with California the first to enact a statewide density bonus program in 1976. There are a number of ways these programs have been instituted: in addition to the increase allowances of market-priced units, other approaches have included reduced open / green space and parking requirements as well as bonus height allowances and flexibility on design standards.
A potential density bonus program in Fredericksburg is still a matter of “if,” not “when.”
Density bonus programs are optional and their implementation varies by locality. Lynch says that the specific proposal and approach is currently under discussion by staff in the city’s Planning Department. They would have to draft an ordinance, which would then need to be approved by city council.
With ongoing discussions about both affordability and density in recent months, how the idea of a density bonus program would be received remains to be seen. But the idea is one of the more substantive suggestions that have been proposed to confront the increasing cost-of-living within the city.
Disclosure: hyperbole is a tenant of Mitchell Properties.
Affordable housing is much needed