Denver’s Housing Strategies and Revisions to the Inclusionary Housing Ordinance Robin Kniech, Councilwoman At Large November 18,

Inclusionary Housing is just one tool in Denver’s Approach to Affordable Housing Homeownership “Workforce” or moderate affordability Five Year Affordable Housing Plan Diverse set of strategies that will help build and preserve housing at all levels of affordability, including housing for the homeless and deeply affordable rental housing for seniors, low-wage workers, etc. Other programs for affordable housing including the Revolving Loan fund, a tool to help close a financial gap for projects receiving federal tax credits, a down- payment assistance program to help qualifying homebuyers purchase in the Denver Metro Area, and a mortgage credit certificate program to help qualifying homeowners increase their usable income 2 Denver’s Housing Plan

2 year stakeholder process, most significant updates since the ordinance was originally passed in 2002 Stakeholder committee comprised of public sector representatives, and experts in real estate, finance, and housing development Two phases of ordinance revisions –Phase One adopted by Council in June 2013 –Phase Two adopted by Council in August Process to Revise Denver’s IHO

History of the IHO What is the Inclusionary Housing Ordinance (IHO)? Adopted by City Council in 2002 Created a unified affordable housing approach to address severe housing shortage of moderately priced homes Requires that all developments of thirty (30) or more detached for sale single family dwelling units and all for sale attached or multi-family projects of thirty (30) or more units include a minimum number of moderately priced units. –Developer Requirement –10% affordability –Restricted sale price –Income eligible buyers NOTE: GVR and Stapleton have separate agreements that are not governed by this Ordinance, but they do receive subsidies through it 4

IHO Basics Who are the families the ordinance was designed to help? 5 Income Level1 (person)2 (persons)3 (persons)4 (persons) 100% AMI$53,700$61,400$69,100$76,700 < 80% AMI< $42,950< $49,100< $55,250< $61,350

Ordinance Revisions 6 items in red indicate revisions

Both the Current and Revised IHO treat all neighborhoods the same when building on-site: 10% of Units Affordable* * Wherever built in City, high cost structures with elevators allowed to sell affordable units at 95% AMI to compensate for higher construction costs Ordinance Revisions

“Zones” for Cash-in-lieu or Incentives Zones based on Need/Transit Distribution: LOW = 25% MEDIUM = 60% HIGH = 15%

IHO Variation Based on Statistical Neighborhood Zone Zone *Cash in Lieu*Cash Incentives High 70% of Sales Price $25,000 per unit Medium 50% of Sales Price (Existing) $6,500 per unit (Existing adjusted by inflation) Low 25% of Sales price $2,500 per unit * Except within ½ mile of transit, which receives the medium incentive Tiering Cash in Lieu and Incentives by Zones

IHO Variation Based on Statistical Neighborhood Zone Cash In-LieuCash Subsidy

More Flexibility to Get More Homes and/or Reduce Burden Provide expertise and support to developers willing to explore other ways to build housing Denver needs than the 10% formula requirement. Could be on-site or off-site. These “outside of the box” solutions could create better outcomes for all parties (developers, City, families needing affordable housing, etc.): –Rental housing vs. for-sale –Deeper affordability –Fewer units but with more bedrooms –Leveraging the Ordinance units with other projects/subsidies 11 Ordinance Revisions

Denver City Councilwoman At-Large Robin Kniech (720) Robin Kniech, Denver City Council At-Large