Attachment 1

STRATEGY:  Develop and implement necessary regulatory and administrative functions for establishing affordable housing strategies in all applicable development review applications.

• Create a tracking and monitoring system that displays critical affordable housing data in a visual, geographic format
  • The Office of Housing has tracked some housing data on a regular basis over the past year.  The current data collected on sales of new and existing houses and rental properties will be refined and data related to residential projects in development review will be collected and tracked. Data collection will be coordinated with the County’s GIS initiative and the Community Development department.  Quarterly reports will be presented to the Housing Committee and provided as information to the Planning Commission and the Board of Supervisors as well as being posted on the County’s website.  The Housing Committee and Office of Housing will develop an annual report to the Board that summarizes conditions, current sales data, current development data, and activities that have had an impact on affordable housing.

• Reconsider density limits, why they are not being utilized – look for housing opportunities, holes in the current market
  • The current density bonus provisions have not been beneficial in producing affordable housing.  There are likely two main reasons for this.  First, few if any proposals come forward requesting more density than allowed by right.  Secondly, if a developer requests the thirty percent (30%) bonus, all additional units would have to be affordable.  Even if a developer requested and received the bonus, there is nothing other than sales price and rent limits in the provision that would require the units to be available to low- to moderate-income households.  In addition, for sale units would only have to be affordable at time of initial sale and rental units would have restricted rents for no more than five years.

Recommended action:  The zoning ordinance should be amended to revise the current density bonus to provide increased density of up to 100% of that allowed by zoning district or the upper density limit specified in the Comprehensive Plan, whichever is less with a maximum allowed density not to exceed eighteen (18) dwelling units per acre.

EXAMPLE:  A ten acre site is zoned R-4 with a Comp Plan Density of three to six dwelling units per acre.  The applicant proposes a density increase to six units per acre or a total of sixty (60) units.  The proposed density bonus would allow this increase without rezoning if the applicant develops 10 of the additional 20 units as affordable.   NOTE: If the Comp Plan upper density had been 12 units per acre in this example, the density bonus would have been limited to 8 units per acre or 100% of the zoning district.

The request and approval for the increased density would require that one half additional units be affordable and give the County or its designees a 90-day priority marketing period.  During this period the sale or rental would be restricted to low- to moderate-income households.  By using County funds to provide downpayment assistance, the County or its designee would have first right-of-refusal for a subsequent sale.  If the County or its designee does not exercise this option, the downpayment assistance with interest will be repaid at the time of sale. If the designated affordable units are for rent, the owner/manager would be expected to enter into an agreement with the County specifying the maximum rents and eligible household incomes of tenants.  The Office of Housing would monitor compliance through annual reports.

• Eliminate barriers, provide procedural incentives for those in compliance with the standards
  • The Department of Community Development is cataloging all requirements and issues related to the development review process.  This information will be provided to the Board of Supervisors in May for review, discussion, and guidance on what, if any, of the issues may not be important to the review process or that could be waived if the project has an affordable housing component... 

STRATEGY:  Set specific targets for the development of affordable units for low-and moderate-income families with sufficient flexibility to allow for negotiation based on the development’s size, location, timeline, and nature of surrounding area.  At a minimum, 15% of all units developed under rezoning and special use permits should be affordable as defined by the County’s Office of Housing and Housing Committee or a comparable contribution should be made to achieve the affordable housing goals of the County

• Identify specific “proxies” for the 15% target that promote the county’s concept of affordable lifestyles
  • This recommendation is not under consideration at this time as most proxies discussed (limited transportation needs, live close to work, energy-efficiency, and low-maintenance structures) are not controlled or likely to be controlled by the County.

• Allow a phased-in approach to the target that allows a close match between affordable housing created and families prepared to purchase
  • Recommendation:  The number of affordable units will be calculated on the additional units provided as a result of the rezoning.  Additional units shall be those that exceed units allowed by the zoning district or by-right.  Although a development may propose a higher percentage of affordable units, in no case shall more than 15% of the total developed units be expected to be proffered in seeking rezoning.

Total additional units            Percent of additional units to be proffered (all fractions rounded up)

1-3 units                              0%

4-11 units                            25%     

12-20 units                          30%

21-35 units                          35%

36-50 units                          40%

>50 units                             45%

• Establish an “in lieu of” system that is simple and easy for developers to use in their initial planning and financial modeling
  • Recommendation:  The County should develop a proffer system that allows developers to contribute cash or other comparable non-cash contributions to support affordable housing initiatives in lieu of developing affordable units.  Until such a system is developed, the amount of $1725 per residential unit proposed for development should be used to determine a cash or cash-equivalent proffer to support affordable housing initiatives.

The cash amount is calculated using the 2004 median sales price of new homes sold, $175,000 (the affordable target), 10% representing sharing of developer/builder profit, the number of proposed units, and 15% of the proposed units.  The calculation follows:

2004 median sales of new homes sold     $290,000

            Less                                         $175,000

DIFFERENCE                                      $115,000

            Times                                                 .10 (contribution of profit)

Contribution per units                             $ 11,500

            Times 15% of total units                                    9 (assuming 60 units)

Total cash proffer                                  $103,500

            Divided by total units                 _____60

Per unit proffer                                   $   1,725

NOTE:  In this example, the contribution of cash proffers would likely assist six homebuyers with downpayment assistance under the current Homebuyer Assistance Program.

• Establish a policy on the minimum size of a project to be subject to affordable housing goals. Should there be a minimum number of units in a development before the policy is activated?
  • For proffering units, see previous section.
  • For cash or cash-equivalent proffers all projects would use the suggested amount in the previous section regardless of size.

STRATEGY:  Develop strategies and mechanisms including security instruments for the initial sale of affordable units to promote long-term affordability and protect direct monetary investments from public resources.

• Create Housing Trust Fund and associated programs with dedicated source(s) of funding (recapture investment and share equity on resale)
  • The Office of Housing has developed a Homebuyer Assistance Program using general funds appropriated by the Board of Supervisors and federal HOME funds currently available. The program will be coordinated with other resources including those available through the Piedmont Housing Alliance.  The program provides junior mortgages which are deferred and carry an interest at 6%. The funds including interest will be repaid by borrower not later than upon the sale of the property.  The appropriated funds and the future repayment will be used to begin capitalizing a housing trust fund.
  • As more funding is available through the Albemarle Affordable Housing Fund, general fund appropriations, and proffers, additional programs may be recommended by the Office of Housing and the Housing Committee for expanding activities in a trust fund..

• Connect the housing trust fund to the cash proffer option
  • All cash proffers for affordable housing will be appropriated to a housing fund overseen by the Office of Housing and Housing Committee.  The Office of Housing may execute agreements with other entities for the management of the fund.

STRATEGY:  Expand existing partnerships/programs and create new alliances with the private sector including nonprofit and for-profit housing providers and lenders.

• Promote community development financial institutions
  • The Office of Housing and Housing Committee will look at options for the management of housing fund programs striving to improve the capacity to serve low- to moderate-income households and leveraging available public funds to the greatest extent possible.  One option is entering into a management agreement with Piedmont Housing Alliance (PHA), an existing CDFI and helping PHA improve its capacity as a nonprofit lender.
  • The Office of Housing will seek opportunities to use available resources including CDBG, HOME, and the Albemarle Housing Initiative Fund to leverage partnerships with private developers including nonprofit housing organizations.

• Review models from other communities
  • Recommendations included in this document are modifications of two existing programs in the Commonwealth – the Counties of Fairfax and Loudoun.  We do, however, see major differences in development activities in these jurisdictions and Albemarle.  Albemarle continues to receive requests for developments with densities less than outlined in the Comprehensive Plan compared to the much higher density requests in the Northern Virginia area.

STRATEGY:  Seek additional resources including those through the state and federal governments for the development and/or financing of affordable housing.

• Consider dedication of property tax (1 cent) or some other form of dedicated revenue stream from local funds for Housing Trust Fund to support workforce housing.

§         The County of Albemarle currently contributes $250,000 annually to the Albemarle Affordable Housing Fund for investment toward affordable housing projects and programs.

§         The Office of Housing and Housing Committee should prepare a case based on demand supporting an increase in local general funds for affordable housing initiatives in future County budgets.

§         The County should look for opportunities that involve public/private partnerships, specifically those involving nonprofit organizations that may be eligible for Community Development Block Grant Funding to support development of affordable housing.

§         The County should continue to support rental projects seeking Low-income Housing Tax Credits particularly those targeted to those populations where there is a documented increase in demand for affordable rental units.

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