ITHACA, N.Y. — It’s finally happening. Members of the city of Ithaca Common Council will have their first look at the proposed inclusionary zoning law at their meeting Wednesday night.

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Inclusionary zoning is a tool used in some cities to encourage home builders and developers to build affordable housing. In exchange for setting aside a certain percentage of housing units for lower-income families, zoning laws may be relaxed. For readers unfamiliar with the topic, the Voice has done write-ups on the topic here and here. Mayor Svante Myrick highlighted an inclusionary zoning law as one of his policy goals during his “State of the City” address back in January.

As proposed, the inclusionary zoning law would be triggered by most residential construction, conversion or renovations, including any new home or apartment construction, renovations that create new units in existing homes (accessory apartments, subdividing a house), and converting a rental property into condos. Projects without residential components, like hotels and academic buildings, would not be affected by the law.

The law mandates that 15% of units be set aside for those making 60% of Area Median Income (AMI), or 10% of units for those who make 50% of Area Median Income. We’ll get more into those numbers in just a bit.

The affordable housing components could be achieved with a few different options – building them into the project, building them at a city-approved location within 0.5 miles of the project, payment into a city-run affordable housing fund, or converting existing units into affordable housing.

In exchange for building affordable housing units, developers may forego parking requirements, add one floor in certain neighborhoods (Waterfront, Enterprise and Urban Mixed-Use areas identified in the Comprehensive Plan), and be exempt from parts of the city’s site plan review, if the project is in an area with form-based design standards (which is only Collegetown at this time).

So that’s sort of the big, nutshell explanation of it. Now for a few specifics.

Affordable housing is defined as housing rentable by those making 50%-60% of area median income (AMI), or purchasable by those making 80% of AMI. The city defines AMI as $54,100/year for an individual, so 50% of that is $27,050/year, 60% is $32,460/year, and 80% is $43,280/year.

A person making $27,050 a year makes about $2254 a month before taxes. If they wanted a studio, they would be expected to pay up to $680/month, 30% of their income. If they want a 1-bedroom, then the contribution would go a little higher, up to $739/month, 33% of income. The numbers adjust for number of members in a household and size of the unit, as seen in the table above, copied from the law itself. Rents on affordable units would need to stay affordable for 50 years.

New homeowners, whose annual income would have to be 80% of AMI ($43,280) or less, would be required to sell their home at an affordable price if sold within the first 15 years of ownership. Purchasable units are defined using a principal, insurance, taxes, and interest (PITI) ratio of 37% of monthly gross income, and a down payment on a house/condo of 5% (curious what those mean? We explain it here).

If the builder opts to pay a fee instead of building the affordable housing units, then they pay at least $100,000 to a city-run affordable housing fund for each unit they were obligated to build. For larger projects, it’s $100,000 multiplied by 20% of the unit total – so a 20-unit building would need to pay $400,000 instead of $300,000.

New units would have to look and be finished out the same as the higher-priced market-rate units, but they could be up to 20% smaller.

Oh, and just so it’s clear – students don’t qualify for affordable housing units. For sale or rent. No subletting either.

Those are just some of the details. There’s a lot more meat to the law than one article can manage, so a link to all the stipulations and rules can be found here.

Expect a lot of debate over the details of this inclusionary zoning law, from the length of the affordability period to the size to the benefits allowed, to whether this law is even a good idea. It’s clear this will generate a lot of paperwork both for developers and city officials; and the city will have to take precautions to make sure things like the proposed affordable housing fund aren’t raided to pay for other programs. Also, some parts will need to be clarified; it’s not totally clear just what one has to do or pay if they build an in-law apartment onto their house.

It’s a ways out before the Common Council votes to enact the new rules, but everything has to start somewhere. The Voice will be following up with a report from Wednesday’s meeting.

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Brian Crandall

Brian Crandall reports on housing and development for the Ithaca Voice. He can be reached at bcrandall@ithacavoice.com.