Date: 11/5/2005 2:28:29 P.M. Eastern Standard Time
Sent from the Internet (Details)
NB - So in Madison, they start with IZ, then go to Tifs, which starts with T and
that rhymes with P for Pilots, which is the same thing, but it's all trouble.
Tif/Pilot is what they are doing on Hudson Yards, where taxes to cover the city's
needs are being shifted to the outer boroughs. But as in Chicago and other cities,
when there's too much Tif, the tax base becomes undermined. No one has given
a serious look at comparing the incremental benefit of a small amount of IZ housing
with the net loss of affordable housing and small retail due to the larger buildings
being built. The only people who really benefit from IZ - or from Tif/Pilots are the
politicians who try to claim they are doing something.
Click here: madison.com
Is inclusionary zoning working here?
By Lee Sensenbrenner
November 5, 2005
When author David Rusk visited Madison and laid out his vision for mixing relatively affordable housing into every new residential development, he said the success of the idea depended on a firm deal between builders and the city.
Builders, he said, could not suffer under the policy called inclusionary zoning. They had to be granted permission to build in new ways that would offset the burden of providing lower-cost housing, whether this meant building taller, laying foundations closer to the street or putting duplexes in neighborhoods that had previously been only single-family houses.
In turn, Rusk said, the city would gain economic diversity in neighborhoods with new construction, keep working families that might otherwise flee the city for cheaper housing and potentially begin to ease concentrated pockets of poverty.
Rusk, a former mayor of Albuquerque who has seen inclusionary zoning successfully used in many parts of the country, spoke in Madison three years ago, just as Mayor Dave Cieslewicz was preparing to run for his current job.
When he did, Cieslewicz campaigned partly on Rusk's ideas, and about nine months into his first term, Cieslewicz had passed an inclusionary zoning law, an accomplishment that many considered unlikely and made Madison the only city in the state to have such an ordinance.
Now, roughly a year and a half after the law took effect, the first wave of IZ units are on the brink of ownership, but the law behind them has an uncertain future.
The mayor said he will submit a revised version of the inclusionary zoning ordinance on Tuesday, while a sizable minority of City Council members are calling for its repeal. Affordability vs. design: In downtown developments, the exchange of special zoning allowances for affordable housing units has not been a clear trade-off, according to Alexander Co. manager Matt Meier, because virtually every project in central Madison has to have special zoning allowances.
"The zoning downtown hasn't been updated or applied for decades," he said. Instead of a rigid system of zoning codes, any development in the city faces a test of committee approvals, balanced against the plans and concerns of the neighborhood.
So instead of being guaranteed the right, for example, to build a couple extra stories if inclusionary zoning units are included, what often happens is that a developer builds what the city and neighborhood will accept and then asks for tax incremental financing assistance to cover the costs of providing units below market prices. In TIF districts, taxes generated by the increased property values go toward needed improvements until the improvements are paid for.
But, as Meier said, getting that assistance is a political battle and "it's getting more and more difficult to procure TIF funding."
The Alexander Co. was among the downtown developers that didn't initially object to IZ, but Meiers said now that the way the law is being applied in Madison is "taking its toll."
At the same time that TIF agreements are becoming more difficult, the developers who are avoiding requests for public assistance to comply with IZ are running into criticism that their projects are too tall, too close to a street or are otherwise violating some aspect of their neighborhoods.
Consider an eight-story project proposed to replace a single-story optometrist's office and some parking lots at 425 W. Washington Ave. It would provide 40 residential units, some 12,000 square feet of office space and 2,500 square feet of retail space, along with a green roof planted with trees and bushes.
So far, it's been unanimously rejected by one oversight panel, the Urban Design Commission. The neighborhood plan calls for a building there that's about four stories tall.
"I think that actually is a textbook example of the conflict here," Cieslewicz said.
"It would probably be the greenest building in the city," said Ald. Zach Brandon, "but in order to make it work, it needs to be eight stories."
Brandon is among the seven City Council members now calling for the repeal of inclusionary zoning, because, he said, the city "does not have the political will to make it work."
As he laid it out, the city is unwilling to bend its guidelines for housing height and density to provide affordable housing and instead relies on cash handouts to get developers to comply with the law, which he said is unacceptable. When TIF funding has been awarded, the city has paid about $35,000 to $70,000 to subsidize many of the IZ units built in the last year.
Ald. Brenda Konkel, who was one of the primary proponents of inclusionary zoning, has also been critical of projects that exceed neighborhood density standards.
"Are we just going to build everything in a big shadow downtown?" she said. "There's giving a developer leeway, and there's letting a developer build something that's twice as big as everything else."
"Just because it's IZ-compliant doesn't mean they can do whatever they want," she said. The debate ahead: Cieslewicz said that he has no universal answer on whether to side with affordable housing requirements or conform to neighborhood plans, but that the conversation on which way the city should lean is beginning.
In the case of 425 W. Washington Ave., he said the "answer is shaded toward affordable housing," but so far he is not calling for guaranteed rights for developers who comply with IZ.
He said vetoing any attempt to repeal the law was "an option," and that "the law so far has been extraordinarily successful."
Since it was introduced, 359 affordable housing units have been approved. The first six to have accepted offers are part of a project nearing completion on the 800 block of Williamson Street, according to Brad Murphy of the city's Planning Department.
Changes to make the law function better, Cieslewicz said, were always expected. And the ones he will propose Tuesday streamline the process of buying and selling a unit, and provide further flexibility for developers.
Among his proposed revisions is the abandonment of a complex schedule that determined how much equity the owner of an IZ unit could take when it was sold. Under the current law, the owner cannot take any advantage of how much the home has appreciated if it's sold within two years. After that, the owner is allowed 5 percent of the market equity per year of ownership until the 11th year.
Cieslewicz called this system "too cumbersome."
"It doesn't allow people to achieve enough equity," he said. In its place is a plan to have the city take out a second mortgage on IZ units equal to the gap between what they are sold for and their market price. The city would then still have the option of keeping the unit in the affordable housing pool when it's sold, and the seller would not be so tightly restricted.