Inclusionary Zoning

What is inclusionary zoning: Inclusionary zoning (IZ) or inclusionary housing policies call for new housing developments to include a percentage of affordable housing units within the development. Inclusionary zoning works well when the housing market is strong in an area. One of its primary benefits is the deconcentration of poverty.

Programs generally include eligibility requirements for potential affordable housing residents and provisions for continued affordability of the units. Policy considerations for designing effective inclusionary housing programs include the inclusionary percentage—how much is required; the income levels targeted; alternatives to construction on-site; developer incentives; and length of affordability.

One of the most successful IZ programs in the nation is the Montgomery County, Maryland Moderately Priced Dwelling Unit (MPDU) Program, enacted in 1974 and administered through the County's MPDU Office. This program requires that between 12.5% and 15% of the houses in new subdivisions of 20 or more units be MPDUs. The requires that 40% of the MPDUs be offered to the Housing Opportunities Commission (HOC) and other non-profit housing agencies for use by low and moderate income families. In the summary and history section, the adoption process for the ordinance is described, along with changes made to the ordinance since 1974. (A sample project built under the MPDU Program is Timberlawn Crescent.)

• Enterprise Foundation Resource Database: Inclusionary Zoning: Program Design Considerations (with a program design checklist). This publication discusses many of the major considerations involved in designing an inclusionary zoning program, including appropriate markets for inclusionary programs; mandatory versus voluntary programs; the nexus argument; qualifying individual households; percentage and types of affordable housing required; continued affordability controls; on-site and off-site provision of housing; payments in lieu of providing housing; regulatory agreements and enforcement; and compensating benefits to developers.
• Nonprofit Housing Association of Northern California and the Home Builders Association of Northern California published a brief in July 2005 entitled On Common Ground: Joint Principles on Inclusionary Housing Policies. In this brief, these organizations express their belief that increasing the housing supply is critical, and that the community needs to maximize the limited resources available for affordable housing. For inclusionary zoning this means that the "traditional" way of implementation may not be the most effective. They have provided a number of guiding principles for communities considering adopting or amending inclusionary housing programs.
• Nexus studies: From a legal standpoint, an inclusionary zoning ordinance must have an argument showing a relationship between: (1) the construction of higher-priced housing or commercial properties and (2) the lack of affordable housing and the social and economic ills that have resulted from that. The nexus argument must be made with great care so the ordinance will stand up to potential lawsuits. It can take the form of a report referred to by the ordinance. Communities that have completed nexus studies include City of Belmont, MA; Contra Costa, CA; San Luis Obispo County, CA; Santa Fe NM: Sebastopol, CA; Garfield County, CO; and NAPA, CA.
• Offsets: In order to help offset the cost to the developer of providing affordable housing, communities adopt incentives, including: density bonus, waiver or reduction of development fees, waivers or adjustments to development standards, and expedited development approval.
• The California Institute for Local Government – the nonprofit research arm of the League of California Cities – is a source of research and information for California's local officials. The Institute specializes in addressing issues of topical and practical concern to local agencies in California. In 2003 the Institute published the California Inclusionary Housing Reader, which is designed to assist local leaders in deciding whether an inclusionary housing ordinance is right for their community. The report includes an explanation of inclusionary zoning; the pros and cons of IZ; experiences of local governments that have adopted IZ programs; a summary of legal issues; and a sample ordinance.
• Inclusionary Zoning Drafting Tool: The Chicago Metropolitan Mayors Conference, created in 1997, includes 272 mayors from six counties surrounding Chicago. The Caucus, which provides a forum for discussion, cooperation and consensus, addresses major issues including housing. One of the publications offered by the Mayors Conference is an inclusionary zoning program drafting tool: Mayor's caucus Drafting tool
• Inclusionary Housing Toolbox steps for developing an inclusionary housing program
• Policy Link Inclusionary Zoning Resources a comprehensive look at inclusionary zoning.
• BPI Chicago Inclusionary Zoning page includes publications, policy briefs, matrices, and local examples.
• Inclusionary Zoning: Guidelines for Cities and Towns, prepared for the Massachusetts Housing Partnership Fund
• Inclusionary Housing Slide Show
• Affordable Housing Ordinances sample ordinances, including linkage, inclusionary zoning, density bonus
• Woodland California inclusionary housing agreement
• Sacramento Housing Alliance, SACOG slide show
• BPI Chicago matrix of inclusionary zoning programs
• Calabasas inclusionary zoning/linkage resolution
• Chicago, IL inclusionary zoning
• Fremont CA inclusionary zoning
• Contra Costa Co. CA inclusionary zoning
• Walnut Creek CA inclusionary zoning