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Inclusionary Housing:
A Viable Solution for Opportunity and Progress
What is it?..Where Does it Come From?
Over 25 years ago, wealthy Montgomery County, Maryland, outside Washington, DC, adopted its Moderately Priced Dwelling Unit (MPDU) ordinance. The "MPDU" mandate was the nation's first inclusionary zoning law.
In any new housing development of 50 or more units, the county council ruled that at least 15 percent of the housing must be affordable for the lowest one-third of the county's households. As compensation, developers could receive a density bonus of up to 22 percent. By law, the county public housing authority could buy one-third of the affordable units.
In the decades after the advent of the ordinance, for-profit homebuilders produced almost 11,000 MPDUsÙtwo-thirds purchased by young teachers, police officers, retail and service workers. Over 1,500 MPDUs, scattered in more than 200 middle class subdivisions, were purchased by the housing authority.
The result? Montgomery County became one of the nation's more racially and economically integrated communities. Ensuring housing for a diversified labor force also was key to successfully diversifying the county's job base. (David Rusk, Innovative Housing Institute)
How Does it Work?
Key elements of Inclusionary Housing are:
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A threshold number of market-rate units that activates
the inclusionary requirement for a corresponding percentage of affordable units;
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A requirement that the affordable units are comparable
in quality and aesthetics to the market rate units, so that even if they are smaller
or of a different type, they will blend into the community.
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Incentives to assist the private sector in providing
affordable units, such as density bonuses, financial subsidy for construction, or
down payment assistance to the affordable homebuyer;
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A provision for payment in-lieu when the nature
of the development makes it infeasible to include affordable units; and
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A housing trust fund as the depository for payments
in-lieu, and a mechanism for using those dollars to provide affordable housing within
the community. (Jaimie Ross, 1000 Friends of Florida)
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South Florida has to change the "rules of
the game". While we have seen tremendous economic growth and expansion, we've
seen the cost of housing explode for low to moderate income folks. Increasingly,
a greater and greater number of people are living further and further away from
where the jobs are, in poorer and poorer communities.
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The real estate boom is displacing entire neighborhoods
as new developments and gentrification of communities drive up sales prices and
rents. Inclusionary housing would create affordable set aside housing units thereby
providing opportunities for households at a variety of income levels to remain in
their neighborhood, or move into a wealthier community where there was nothing affordable
before.
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South Florida has 43 "Extreme Poverty Census
Tracts", those census tracts where more than 40% of the population lives below
the poverty line. In 1980, there were only 22 Extreme Poverty Tracts.
- A minimum wage worker would have to work 117 hours per week in Miami Dade and 115 hours in Broward to afford a two bedroom rental unit at Fair Market Rent, currently at $781 per month in Miami Dade and $767 in Broward.
What it Could Do
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No policy would have a greater impact than mandating
"fair share" mixed-income housing as a modest proportion of all new developments.
Across metropolitan America there are twice as many poor whites as there are poor
blacks or poor Hispanics. Poor whites, however, rarely live in poverty-impacted
neighborhoods. Only one of four poor whites lives in a neighborhood where poverty
rates exceed 20 percent (and 1 of 20 in neighborhoods with poverty rates higher
than 40 percent).
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By contrast, the numbers are reversed for poor
minorities. Three of four poor blacks (and half of poor Hispanics) live in poverty-impacted
neighborhoodsÙand one-third of poor blacks live in high-poverty neighborhoods.
This racially skewed concentration of poverty drives up crime rates, drives down
local school test scores, depresses local property values and often drives up tax
rates of fiscally stressed city governments.
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Research demonstrates that "mainstreaming"
poor minorities into middle class communities (as most poor whites are) slashes
crime and delinquency, boosts school performance, narrows the "segregation
tax" that minority homeowners pay in the value of their homes and eases fiscal
burdens on city governments.
- In sum, inclusionary housing policies offer the opportunity for the creation of affordable housing in economically and socially mixed communities. The end result is the production of affordable housing and integrated neighborhoods, not slums.
Want to Learn More?
Contact the Coalition or visit the following web sites: ours at www.floridacdc.org/; The Innovative Housing Institute at www.inhousing.org; or 1000 Friends of Florida at www.1000friendsof florida.org.