DWELLING ON DENSITY / EXPLORING AFFORDABLE HOUSING DEVELOPMENT IN THE CITY OF BERKELEY

Transcription

1 DWELLING ON DENSITY / EXPLORING AFFORDABLE HOUSING DEVELOPMENT IN THE CITY OF BERKELEY THE PROBLEM Affordable housing in Berkele is produced in two was: BAY AREA b private developers mixed into market-rate projects, and through government-funded nonprofit development projects. Priorit Development Areas Ba Area Plan ing for the latter comes from fees on private development leveraged with count, state, and federal sources. All of these funding sources have depleted in recent ears. PRIORITY DEVELOPMENT AREAS Adeline Street/ South Shattuck Strategic Plan Downtown Berkele/ Downtown Area Plan San Pablo Avenue/ West Berkele Project South Shattuck/ South Shattuck Strategic Telegraph Avenue/ Southside Plan Universit Avenue/ Universit Avenue Strategic Plan Miles The Ba Area s population is exploding. With an expected population growth of 24% b 2040, and pursuant to California Senate Bill 375, Berkele has adopted a high-densit, transit-oriented growth-management strateg around identified Priorit Development Areas (see map above). With most of its land alread developed, Berkele is now facing the complicated task of accomodating its share of regional population growth while expanding availabilit of affordable housing. Development fees Other sources $ $ Count State Federal $ Berkele is considering a local polic change that would grant a densit bonus to developers in exchange for paing fees that would be used to fund affordable projects. How should Berkele expand the suppl of affordable housing using the densit bonus plan?

2 DEFINITION OF KEY CONCEPTS DENSITY Residential densit is defined as the number AFFORDABILITY Residential affordabilit is defined as 30% or less of household income spent on rent of dwelling units per acre (du/ac) INCLUSIONARY 100% AFFORDABLE ASSOCIATED PROBLEMS FLOOR AREA RATIO [FAR] HOUSING HOUSING Ratio of total floor area of structures on a lot to Inclusionar 100% Affordable total square footage of lot LOT USE $ Parking spaces 4-10 du/ac Single Famil Dwelling Lack of communit Peripheral location Building Services Parking spaces du/ac Townhouses No in-building services Ghettoizing the poor Parking level entrance du/ac Apartments Below market rate (BMR) units Less affordable Length build process ZONING CONCESSIONS Reductions in certain zoning regulations, such as: open space parking setbacks height limits BELOW MARKET RATE (BMR) UNITS INCOME BRACKETS Units that are reserved as affordable housing. Rents Extremel low Income 30 % Area Median Income DENSITY BONUS for below-market-rate units are set as 30% of the Ver Low Income 50 % AMI An increase in the number of residential units on a income of target tenant group (see Income Brackets Low Income 80 % AMI parcel beond what the zoning ordinance allows table to the right). Moderate Income 100 % AMI

3 BERKELEY DEMOGRAPHIC OVERVIEW SNAPSHOT OF BERKELEY DEMOGRAPHICS AT A GLANCE DENSITY COMMUTER POPULATION Total Population 116,768 Median Age 31 27% of Berkele s Population is Workforce emploed b UC Berkele 23% Median houshold Income $61,960 Average Household Size 2.17 Renter/ Homeowner Population 59%/41% 2010 Census Data, Berkele Element ,000 10,000-15,000 15,000-30,000 30,000-70, , ,000 52,330 Workers commuting into Berkele dail BREAKDOWN BY RACE 11, 197 Work & live in Berkele 5% 11% 19% 55% White African American Asian, Native Hawaiian/ Pacific Islander 27,176 Berkele residents working elsewhere Two or More Races 10% Hispanic Latino 2010 Census Data 48% of commuters to Berkele make <50% of AMI 2010 Census Data, Berkele Dail Planet 36% of Berkele residents make <50% of AMI Data from LEHD BERKELEY OVER TIME POPULATION GROWTH NUMBER OF UNITS BUILT UC BERKELEY STUDENT % OF INCOME SPENT ON HOUSING (In Buildings with 5+ Units) POPULATION GROWTH , ,768 29, , , , , s 1970s 1980s 1990s , Census Data, American Communit Surves Cit of Berkele - Consolidated Plan for & Communit Development (2010) Berkele Element (2009) UC Berkele Census Data in Berkele has become more expensive over time; construction has declined while demand, especiall from students, has increased.

4 POLICY BACKGROUND STATE DENSITY BONUS LAW 1979 California passes Densit Bonus Law Grants a % increase above local limits on the allowed number of residential % of total units in project that are reserved for: moderate income low income ver low income Densit bonus granted units for a project along with two zoning concessions in exchange for 10% 5% 1990 Berkele creates inclusion of below market rate (BMR) units. Local governments cannot den a densit bonus to proposed projects that meet the state s criteria. 10% 5% 10% 15% 20% 25% 30% 2008 California passes Senate Bill % 20% 11% 35% BERKELEY S CURRENT PATHS TO AFFORDABLE HOUSING 2009 California Superior Court effectivel bans Inclusionar Zoning for rental residences 10% ver low income 20% low income 50% accessible for seniors INCLUSIONARY DISINCENTIVES Reduced rent INCENTIVES Densit bonus from BMR units Mitigation fee exemption 2011 Berkele creates Mitigation Fee $28,000 mitigation fee per unit 100% AFFORDABLE DISINCENTIVES Per-unit mitigation fee INCENTIVES 100% market- rate rents PROPOSED CHANGES 2013 Association of Ba Area Governments pass Sustainable Communities Strateg Berkele Cit Council is 2015 Changes proposed to Berkele densit polic reviewing a proposal that, if passed, would grant a 35% densit bonus to developers who pa the housing mitigation fee as well as a densit bonus fee. 35% $ + & $28,000 $10,000 densit bonus per unit fee per base unit fee for the developer for affordable housing California s densit bonus polic reduces Berkele s discretionar control over zoning and densit, and gives developers incentives to include affordable housing on-site. The proposed changes could create an enticing local alternative.

5 COMPARISONS: SAN FRANCISCO & SANTA MONICA SAN FRANCISCO DEMOGRAPHICS DENSITY STANDARD The San Francisco planning code standards outline maximum dwelling unit densit based on zoning district and building use. AFFORDABLE HOUSING POLICY Residential developers building 10 + multifamil units must choose from the following options: Include 12% BMR Build affordable housing offsite, within 1 mile radius of market rate project Square Miles 47 Population 837,442 Median Income $75,604/r Renters/ Owners 65%/35% Median Rent as Median Share of Monthl Income 37% Maor s Office of and Communit Development SANTA MONICA DEMOGRAPHICS DENSITY STANDARD The Santa Monica municipal code outlines maximum dwelling unit densit based on zoning district and building use. AFFORDABLE HOUSING POLICY Residential developers building multifamil housing must choose from the following 4 options: Inclusionar units Build affordable housing off-site, within.25-mile radius of market rate project Square Miles 8 Population 84,084 Median Income $71,400/r Renters/ Owners 72%/28% Median Rent as Median Share of Monthl Income 26% Donate, sell, or option land to cit or non-profit hous- San Francisco and Santa Monica both have instituted housing policies not present in Berkele, namel set densit standards and a radius requirement for off-site affordable housing.

6 DWELLING ON DENSITY / DISTRIBUTION OF AFFORDABLE HOUSING % of Berkele renters are overpaing for rent. While sheer AVG. MARKET RENT* production of housing is necessar, it s important to look at the distribution of affordable housing, both geographicall and economicall, to ensure that that production is equitable. Belowmarket-rate units should be available within Berkele s economic centers, and should meet the needs of the lowest income groups. HOUSEHOLD INCOME NECESSARY TO AFFORD AVG. MARKET RENT 2014 $1,765 $2,171 $70,600 $86,840 *3-person, 2-bedroom Berkele 2010 & 2015 affordable housing nexus studies GEOGRAPHIC DISTRIBUTION INCLUSIONARY HOUSING UNITS MAPPED ECONOMIC DISTRIBUTION JOB DISTRIBUTION (jobs per sq mi) 22,450-35,076 12,001-22,450 5,617-12,000 1,407-5, ,407 INCOME DISTRIBUTION 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 75, ,000 BERKELEY POPULATION BY INCOME BRACKET # of households MODERATE & UPPER INCOME 9,565 LOW INCOME 4,305 VERY LOW INCOME 3,650 EXTREMELY LOW INCOME 7, American Communit Surve data # MODERATE-INCOME UNITS b TYPE 0 to 19 units # LOW-INCOME UNITS b TYPE 20 to 39 units 168 units 24 units 100% AFFORDABLE HOUSING UNITS MAPPED 0 units 33 units # VERY-LOW-INCOME UNITS b TYPE 126 units # EXTREMELY-LOW-INCOME UNITS b TYPE 0 units 0 to 19 units 20 to 39 units 255 units 40 to 59 units 60+ units 248 units Job distribution data from LEHD, income distribution data from 2013 ACS 100% affordable housing, in contrast to inclusionar units, is distributed outside job centers and provides more deepl affordable units. Moderate income units are not produced b either categor.

7 DWELLING ON DENSITY / NEIGHBORHOOD AMENITIES AMENITIES MLK Jr Wa AREA e Shattuck Av INCLUSIONARY UNITS TRANSIT Bus Routes Bart WALK, BUS, BIKE SCORES Virginia St Hearst Ave Ave Universit Institution Residential Units Commercial Mixed Use Residential Recreational MLK Jr Wa e Shattuck Av LAND USE a Bancroft W Education Communit Center Park Grocer Virginia St Hospital AMENITIES St TRANSIT M.L.K Jr Wa AREA Ave Universit Sacramento AFFORDABLE UNITS Hearst Ave Cultural Institution Blake St Dwight Wa Bus Routes Bart Ave o l b a San P WALK, BUS, BIKE SCORES a Bancroft W 59 Blake St Russel St Education M.L.K Jr Wa S Sacramento t Ashb St Communit Center 88 Institutional Residential Units Commercial Mixed Use Residential Recreational Mixed Use Light Industrial Park Dwight Wa Ave o l b a San P LAND USE 99 Grocer Hospital Cultural Institution Alcatraz There is significantl better access to neighborhood amenities, public transit, and retail in the area with a high concentration of inclusionar housing than in the area with a high concentration of 100% affordable projects. Russel St

8 IN-BUILDING AMENITIES INCLUSIONARY HOUSING BUILDING TYPOLOGIES AMENITIES & SERVICES QUOTES Set our home apart from the rest - Hillside Village Apartments Acton Courtard (70 Total Units, 20 BMR) Allston Place (60 Total Units, 12 BMR) Workout Facilities Communal Outdoor Courtard/ Terrace We go to great lengths designing ammenities and choosing locations that put everthing within reach. - Avalon Berkele Washer-Drer In-Unit A home that suits our personal needs - Equit Residential (Gaia Building) Berkele Central (118 Total Units, 23 BMR) Pet friendl In-building Access to car-share services 100% AFFORDABLE HOUSING BUILDING TYPOLOGIES AMENITIES & SERVICES QUOTES Our mission is to create and preserve affordable housing...to build communit and enrich lives - RCD Ashb Lofts (54 Units) Margaret Breland Homes (28 Units) Communal Outdoor Courtard/ Terrace Computer Work Space Artists Thrive in Live/Work Lots at 800 Heinz Ave. - The Berkele Dail Plant, August, 2005 It offers more than just an apartment home, it offers a worr-free lifestle. - Harriet Tubman Terrace Website Helios Corner (80 Units) On-Site Workshops Wheel-Chair Friendl [We put an] emphasis on high-qualit design that looks like a market-rate building - SAHA Homes Both emphasize clean, modern designs.100% affordable projects put a strong emphasis on empowering residents through communit activities, while inclusionar buildings focus on giving residents access to services on a more individual level.

9 DWELLING ON DENSITY / PRODUCTION OF AFFORDABLE HOUSING SCENARIO EVALUATION A tpical affordable housing project costs $350,000-$400,000 per unit to build ing sources: 20-25% SCENARIO A: 10-unit building 75-80% 10% Meets BMR unit req. 1 unit BMR SCENARIO B: etc. $2 million Pas ($28,000/unit) to cit $100,000 of cit funding produces 1 unit of affordable housing 20 unit BMR CONCEPT-TO-OPERATION TIMELINE INCLUSIONARY HOUSING I. Concept II. Pre-Development I. Concept & Securing Financing 3-6 ears III. Development IV. Construction II. Pre-Development 100% AFFORDABLE HOUSING V. Operation III. Final Design IV. Construction V. Operation ears It takes more time to build 100% affordable housing projects; however, ou get more units per development with this approach.

10 HYPOTHETICAL COST & REVENUE ANALYSIS This is a hpothetical analsis of the costs a 50-unit proposed development might incur related to affordable housing requirements under 3 scenarios. Scenarios A and B look at the current densit bonus polic, and Scenario C looks at the proposed changes. PROPOSED DEVELOPMENT: BANCROFT APARTMENTS 2124 Bancroft Wa IMPLICATIONS FOR AFFORDABLE HOUSING Pa Include Seek # of # of ADDED REVENUE TOTAL ANNUAL mitigation BMR densit MR BMR FEES / COSTS FROM DENSITY REVENUES FROM fee? units? bonus? units units BONUS RENT SCENARIO A Current polic: Pas mitigation $1.2 million one-time mitigation N/A $1.11 million $1.2 million fee fee SCENARIO B Current polic: Builds on-site housing 58 5 $63,000 annual cost* $400,000 $1.43 million SCENARIO C Proposed polic: Pa mitigation + densit $2.4 million one-time mitigation & densit bonus fees $400,000 $1.51 million $2.4 million bonus fees * Cost here means the difference between revenue from inclusionar units at market rate minus inclusionar units at below market rate Under the proposed polic change, Scenario C produces more units in aggregate while incurring greater costs on developers. However, the increased revenues would absorb that cost in under five ears.

11 LOOKING AHEAD PROPOSED DEVELOPMENTS SUMMARY OF ANALYSIS Priorit Development Areas Proposed market-rate development Proposed 100% affordable housing project The lack of communit issue was qualitativel supported, but needs further research. Spatial analsis shows 100% affordable projects are primaril in peripheral locations outside job centers. Services In-building services exist in both cases, but address different needs. No noticeable income difference between market-rate and 100% affordable development neighborhoods. Extremel low income housholds are underserved b inclusionar housing. Moderate income households are underserved b both. 100% affordable housing projects have a slightl lengthier build process, but result in more affordable units per development. RECOMMENDATIONS RECOMMENDATION #1: Conduct a feasibilit stud to determine a tipping point for inclusionar requirements & fees under the new polic, in order to encourage a mixture. Look especiall at was to promote unit production RECOMMENDATION #2: Develop sstems for gathering and analsing data on below-market-rate unit production, location, and affordabilit to allow for a holistic and adaptive affordable housing strateg. for moderate-income households. RECOMMENDATION #3: Create mechanisms for earl communit engagement between developers and communit members around new proposals. RECOMMENDATION #4: Conduct a stud on the effects of high-densit developments on neighborhoods and incorporate communit education.