Affordable Housing Work Session



Housing Committee Recommendations for Policy Revisions



Messrs. Tucker, Elliott, Davis, White





June 13, 2007


ACTION:     X                             INFORMATION:   



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On June 1, 2005, the Board of Supervisors adopted Resolutions of Intent to amend the County Zoning Ordinance as well as the Comprehensive Plan to reflect the recommendations of the Albemarle County Housing Committee for implementation of the County’s Affordable Housing Policy. The Resolutions resolved to:


1.    Amend density bonus regulations in the Zoning Ordinance to allow a 100% increase in density with one-half of the additional units being affordable.

2.    Establish the basis for calculating the number of affordable dwelling units to be proffered based on the additional dwelling units allowed after the rezoning.

3.    Establish a formula for calculating the cash or cash-equivalent proffers for a rezoning in lieu of proffering the recommended number of affordable dwelling units.


Subsequent to the adoption of the resolution, the Planning Commission, in consultation with staff and representatives from the Housing Committee conducted a series of work sessions and one public hearing to consider the recommendations.


August 2, 2005 – work session to present the three recommendations

October 11, 2005 – work session on the three recommendations 

January 31, 2006 – work session limited to discussion of the density bonus proposal 

August 15, 2006 – public hearing on the density bonus (revision to the Zoning Ordinance) 

August 29, 2006 – work session to provide the Commissioners information on housing issues and existing initiatives

October 24, 2006 - work session to get input from developers/builders and the real estate community


Based on the level of work and input received to date on these initiatives, the Office of Housing and the Housing Committee are recommending that the density bonus zoning text amendment and the amendment to the County’s Affordable Housing Policy proceed as recommended below.



By June 30, 2010, working in partnership with others, increase affordable housing opportunities for those who work and/or live in Albemarle County.



The recommendations that follow were developed through work with the ad-hoc Affordable Housing Policy Advisory Committee and the Board-appointed Housing Committee.  A number of interest groups were represented in the discussions including developers, lenders, and nonprofit housing providers/agencies.  The focus of the work was the development of implementation strategies/guidelines for the Affordable Housing Policy.  The groups provided staff direction on the three issues noted in the “Background” section of this summary.


During the discussions, the issue of initial and long-term affordability was brought forward; therefore, a fourth recommendation is included in the following set of proposals.  While the concept of retaining long-term affordability in the housing stock created through the policy is desirable, there does not appear to be any means for the County to enforce any long-term affordability provision unless this is addressed in a developer’s proffer.  


1.  Density Bonus

The current density bonus provision in the Zoning Ordinance allows for an increase in units of up to 30% but requires that all of the additional units be affordable.  The provision sets maximum sales prices and maximum rents but does not address eligibility of owners/occupants.


Should the Zoning Ordinance be amended to continue to allow a density bonus, but require that only one-half of the additional units qualify as affordable housing?  Should the Zoning Ordinance be amended to add eligibility requirements for purchasers and tenants?

The Housing Committee recommends retaining the 30% density bonus but requiring only one-half of the additional units be affordable as defined by the County’s Affordable Housing Policy.  In addition, the Committee recommends adding language that limits ownership and occupancy to those households at or below 80% of the area median income.


2.  Calculating the number of affordable units     (NOTE:  The following recommendation differs from proposal 2 included in the Background section of this summary.  A new resolution of intent may be necessary prior to proceeding.  The proposed sliding scale is a result of discussions with the Board during work sessions on North Pointe.)


The Neighborhood Model seeks a mixture of housing types and affordability.  In many of the rezoning requests that include affordable housing proffers, 15% of the units are affordable (<$191,000) and the projected market price for the other units is often in excess of $300,000, creating a gap in the availability of what is described as “workforce housing” or moderately-priced housing.  In addition to the gap in moderately-priced units, there is also a portion of the population that may desire to be homeowners but cannot afford the “affordable units”.  Approximately sixty percent (60%) of housing counseling clients would require units selling for under $160,000.


Should the Affordable Housing Policy be amended to allow credits for the provision of housing available to households having other income levels?

The Housing Committee recommends the following scale for calculating credit toward the affordable housing goals by recognizing housing at various price ranges providing additional flexibility to developers.  To preserve the intent of producing affordable housing, at least 50% of the units proffered must be at or below 65% of the VHDA limit.


Credit Factor

% VHDA Limit

Current Selling Price



























3.  Cash or cash equivalent Proffers


Should the Affordable Housing Policy be amended to further define “comparable contributions”?

The Housing Committee has recommended that a reasonable cash proffer be defined as an amount needed to provide a 10% down payment on an affordable unit.  With affordability proposed to be defined at 65% of VHDA’s maximum sales price for first-time homebuyer programs, it is recommended that reasonable “comparable contributions” in lieu of an affordable unit be defined as up to 6.5% of the same index, which is currently $19,100.



4.  Promoting initial and long-term affordability


Can the affordability goals be met with housing units that have an affordable selling price or an affordable appraised value?

 At least two developments that proffered affordable units have since indicated that their units will be appraised at levels significantly higher than the proffered sales price.  Thus, the units are not affordable although the developer/builder is providing an affordable opportunity to the first purchaser by subsidizing the sale. The Housing Committee believes that the intent of the Affordable Housing Policy is to increase the supply of affordable housing. Therefore the Housing Committee recommends using appraised value rather than selling price in determining whether a unit meets the County’s goals.  The Committee further recommends that units appraised for not more than 5% above the defined affordable price should be considered as meeting the intent of the policy without any further action required.


Should credit towards meeting the Policy goals be given for units that appraise for an amount higher than the defined affordable selling price but sell at or below the affordable selling price?

The Housing Committee recommends that housing units appraised for an amount greater than 105% of the affordable sales price but not exceeding 120% of the affordable sales price be considered as meeting the Policy goals if:


A.      The sales price is equal to the appraised value with a “net price” to the purchaser in an amount that  is at or below the defined affordable sales price, and


B.      The builder

i)         places a deed restriction on the property in a manner that limits future sales prices so that the unit will remain affordable, or

ii)       takes back a junior deed of trust for the difference between the appraised value and the defined affordable sales price, assigns that deed of trust to the County, and restricts those funds to be used by the County for affordable housing.







The Housing Committee and staff recommend that the Board of Supervisors approve the Housing Committee recommendations for amending the density bonus provisions in the Zoning Ordinance and the Affordable Housing Policy in the Comprehensive Plan and direct staff to prepare the necessary amendments and set a public hearing by the Planning Commission by August 15, 2007. 


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