Support a mix of housing choices, including affordable housing

• Conduct regular housing needs assessments to direct the mix of housing in the community

• Preserve existing housing to maintain housing stock

• Create local financial incentives to encourage affordable housing

• Adopt local inclusionary zoning ordinances

• Encourage employment / housing linkage programs

• Create local mitigation fee programs to provide incentives to build affordable housing

Case Study: Truckee, California

Faced with escalating home prices and a thriving second home market, the Town of Truckee’s City Council updated their General Plan’s housing element to include an employee linkage program and an inclusionary housing program in March 2005. The Truckee regulation requires 15 percent of housing in new residential developments are affordable to households with incomes less that $77,000.

Development, such as retail and offices, resulting in new jobs must provide new housing to accommodate half of the new employees expected to be generated by the project. Workforce Housing Association of Truckee Tahoe (WHATT) assists the town efforts to produce and monitor workforce housing.

Case Study: Mammoth Lakes, California

A significant portion of the Town of Mammoth Lakes economy is based on service and tourism, which tends to provide lower incomes. Mammoth Lakes also has disproportionate median house price compared to average annual personal income.

In order to address this proportion, the town has implemented several policies in an effort to provide a range of housing options for employees in Mammoth Lakes. The town council adopted affordable housing mitigation regulations in 2001. The town backed the council by passing an ordinance to increase the Transit Occupancy Tax the following year, which earmarked one-tenth of the tax revenues for affordable housing mitigation. The tax generates $600,000-700,000 annually.

Mammoth Lakes Housing Inc., a nonprofit housing development was established with the mission to “cause the creation of workforce housing for a viable and sustainable community.” Two of the town’s biggest employers – Mammoth Mountain Ski Area and Intrawest Corporation – as well as the Town of Mammoth Lakes provided the start up funds.

The town then revised its affordable housing mitigation regulation in 2004 address the impact of new development based on the supply of affordable housing.

New developments must submit a housing mitigation plan in order to accommodate the accompanying housing needs. Affordable housing rates are determined by a ratio according to development type: commercial, industrial, multiple-unit residential and single-family residential. The formula estimates the number of full-time equivalent employees for each development type and then requires affordable housing is provided for the estimated.

Developers are compensated for their efforts by receiving up to a density bonus of 25 percent. Mammoth Lakes offers an additional local density bonus if all housing units fits state low- and very low-income affordability levels.

Mammoth Lakes Housing helped facilitate the beginning of 48 new apartments and 24 condominiums began construction in 2004. All the condominiums were sold to the Mammoth Lakes Workforce or in escrow by late 2006; the workforce had leased all the apartments as well. Another 68 units are slated for completion in 2007.

To facilitate the growth of affordable housing, Mammoth Lakes adopted an Affordable Housing Overlay Zone where all units must be for very low-, low- and moderate-income households. Additionally the Town Council may waive any or all fees normally imposed by the Town on development projects. Development standards for parking are relaxed in this zone, and additional zoning concessions may be requested.

Case Study: Montgomery County, Maryland

With rising prices and demand for housing, Montgomery County, Maryland, northeast of Washington D.C, adopted an inclusionary housing program in 1974 that required developers of 50 or more units of housing to make 12.5-15 percent of the units affordable. The policy dovetailed with an earlier decision by the county to create rural zones in order to preserve active agricultural lands. The county realized the direct linkage between a mix of housing choices and maintaining agricultural lands. By providing affordable housing units within developments, it could direct growth to specific areas that were not changing prime agricultural lands to residential lands.

Developers receive a density increase of up to 22 percent for their participation. Fears of real estate speculation on affordable housing is partially assuaged because the county controls the selling price for 10 years and the rental rate for 20 years to ensure affordability. When affordable units are eligible to be resold at market rates, the county shares in the profits.

The law permitted Montgomery County’s Housing Opportunities Commission (HOC) to have the ability to purchase one-third of the affordable housing units. Amongst its wide-ranging duties, the HOC is authorized to acquire, own, lease and operate housing as well as providing for the construction and renovation of housing.

As of June 2006, Housing Opportunities Commission owned and managed 6,740 units throughout Montgomery County. The inclusionary housing program has resulted in the creation of more than 10,000 units in 300 neighborhoods.