NYC Needs Guaranteed Inclusionary Zoning

With Voluntary Program, only 2 - 3% of units are affordable.

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Today the Association for Neighborhood and Housing Development (ANHD) and Council Member Brad Lander released two reports that review the effectiveness of New York City's inclusionary zoning (IZ) program. The reports recommend putting in place a guaranteed program to strengthen the voluntary program and increase affordable housing production citywide.

Council Member Brad Lander released a report, "Creating Affordable Housing Through Inclusionary Zoning in New York City," that reviews the performance of the program from its inception in 2005. ANHD released a white paper, "Guaranteed Inclusionary Zoning: Ensuring Affordability is a part New York City's Future," that lays out a road map for the next administration to create significant affordable housing through a citywide, guaranteed inclusionary zoning program.

The current voluntary program must be improved to ensure that truly affordable housing is created in communities undergoing new development. ANHD Executive Director Benjamin Dulchin said "when the City rezones a neighborhood to include an allowance to build taller and denser, it means the value of a developer's land is increased dramatically with the stroke of a pen. Many communities have asked that these types of rezonings include assurances that create housing affordable to the local community - especially since they can lead to secondary displacements pressures and the loss of rent-regulated housing. Zoning is a public tool that creates private value - it can, and should, be an effective tool for permanent affordable housing as well."

ANHD's Guaranteed Inclusionary Zoning report outlines a plan to require that all large and medium sized developments set 20% of units as affordable housing without accessing City funds. Developers who seek City or State subsidies for affordable housing or who request a zoning change could be required to expand affordability beyond the 20% baseline or affordable at lower-income levels.

ANHD's analysis found that the City could reasonably generate 4,000 affordable units per year by instituting guaranteed inclusionary zoning, which would create approximately 32,000 affordable units over the next 8 years. This is in contrast to the current voluntary program's average of just 400 affordable units per year. At an ANHD co-sponsored Mayoral housing forum in June, several of the candidates expressed their support for a guaranteed inclusionary zoning program.

ANHD's report includes requiring additional protections against tenant harassment by developers, a critical provision St. Nick's Alliance and others fought to put in place in the 2006 Greenpoint-Williamsburg rezoning. The report lays out inclusionary zoning program changes designed to streamline the building process, and allow for a variety of alternate options making it easier for developers to use. Additionally, the ANHD report calls both for improved tracking of inclusionary zoning development and regular reports on the impact of the expanded policy. Council Member Lander will be introducing legislation in the City Council that requires the City to report regularly on the inclusionary zoning program's results.

Council Member Lander and ANHD point out the importance of bringing inclusionary zoning to all of New York City - and guaranteeing the creation of permanently affordable units. "As New York City housing prices continue to rise, many of our low- and middle-income neighbors are struggling to find affordable housing," said Council Member Brad Lander. "In Manhattan's West Side and North Brooklyn, our report found that inclusionary zoning has made a real difference by building thousands of new affordable units. But other neighborhoods have been left behind, seeing mostly development of more expensive new housing. We need to make inclusionary zoning a citywide program and ensure that affordable housing is a guaranteed part of new developments."

Michelle de la Uz, Executive Director of Fifth Avenue Committee saw firsthand the impacts of 2003 Park Slope rezoning which brought massive redevelopment and little affordable housing to the neighborhood. "The affordable housing crisis has reached epidemic proportions in NYC. Too many poor, working class and, even middle class families are stretched to their financial limits due to high rents or are being displaced from their homes and communities all together. Our City's response to this crisis has to match the scale of the problem. Guaranteed Inclusionary Zoning is crucial to that scaled response to ensure the city is diverse, vibrant and affordable to all."

Without requiring developers to include affordable housing, the City housing market has continued to squeeze out affordable housing and local residents are being priced out of their communities. "Communities see large-scale development happening in their neighborhoods, but aren't seeing any affordable housing included." said Barika X Williams, Policy Director at ANHD. "Communities want a stronger tool, and that's Guaranteed Inclusionary Zoning."

A Guaranteed Inclusionary Zoning policy can be critical to the City's affordable housing production in the future. "The requirement to include affordable housing as a component of up-zoning or rezoning of areas which then give a boost in value to properties made ripe for development, provides a highly needed public benefit for this windfall to the private sector. " said Deborah Howard, Executive Director, Pratt Area Community Council.

New York City's current inclusionary zoning program is a voluntary, incentive-based program gives developers the option to build affordable housing in designated areas of New York City. If a developer agrees to make a certain number of the units affordable in their development (or create or preserve affordable housing elsewhere in the community), they are allowed to build more than zoning would otherwise allow, and in many cases receive a tax break and other City subsidies.

The Lander report finds that:

• Overall, inclusionary housing represents less than 2% of all multifamily building permit applications in NYC during these years.
• On the West Side & the Brooklyn waterfront, inclusionary zoning program has proven to be an effective and efficient means of generating affordable housing units.
  • On the West Side, an impressive 19% of total units were inclusionary housing (1,441 affordable units).
  • In Greenpoint/Williamsburg, 13% of total units were affordable housing created through the program (949 affordable units).

• However, outside of those two areas, very few inclusionary housing units were created, even where there was significant development.
  • In the other two dozen designated areas where inclusionary housing was permitted only 6% of all residential development was affordable housing created through the program (Bed-Stuy, Harlem 125th Street, Lower East Side, Jamaica, Harlem River Waterfront, and Riverside South). Some neighborhoods with inclusionary zoning that have seen robust development since rezonings have not seen any usage of inclusionary zoning.
  • While the areas eligible for inclusionary zoning include many of the fastest-growing parts of the city, they collectively contained only 13% of all new multi-family development citywide.

• The program has generated 2,769 affordable housing units since 2005.
  • This is twice the number of units that the old R-10 inclusionary program created in a much longer time period (since 1987).
  • Of these affordable housing units, 77% were newly constructed, rather than preservation of existing affordable housing.

"The affordability of New York City's housing stock, particularly in Manhattan, is one of the primary issues facing our city, as low and moderate-income individuals are being priced out of our neighborhoods at an alarming rate," said Council Member Gale A. Brewer. "A Guaranteed Inclusionary Zoning program could generate thousands of units of affordable housing, and is the best way to maintain the neighborhood diversity that makes New York the greatest city in the world. Developers can and should do more in exchange for rezoning deals, and this proposal is a great way to ensure that permanent affordable housing continues to be built in our city."

Joan Byron, Director of Policy at the Pratt Center for Community Development said "the up-zoning of vast stretches of New York real estate has created a tremendous windfall for developers, many of whom bought and held land in anticipation of exactly this type of massive unearned gains. Guaranteed Inclusionary Zoning would ensure that a small fraction of those gains, created by public action, are used to create a public benefit - permanently affordable housing and stable manufacturing space that will help keep neighborhoods economically diverse."

"Guaranteed Inclusionary Zoning is the last hope for the creation of large amounts of permanently affordable housing in NYC," said Harvey Epstein, Associate Director of the Urban Justice Center. "I applaud Council Member Lander and ANHD for their work." Today's reports outline the steps the next Mayor must take to expand inclusionary zoning and make affordability a guaranteed part of development for New Yorkers.

The ANHD report is available at online here and Council member Lander's report is available via this link.

Blogger -   Barika Williams

ANHD blog team:  Benjamin Dulchin, Moses Gates, Ericka Stallings, Jaime Weisberg, Barika Williams. Anne Troy, editor.