Albemarle Supervisors discuss incentives for housing plan

The Albemarle County Board of Supervisors continued a conversation earlier this month about how to incentivize developers to build units to be sold below market value. The six-member Board last discussed the matter in February and pushed back on the idea of creating an overlay district in the county’s zoning ordinance. (previous coverage)

“The main question today that we would like some feedback on after listening to the information that’s provided is [whether] an affordable dwelling unit program something the Board would be interested in and staff reviewing?” asked Stacy Pethia, the county’s Housing Policy Manager. (view her presentation)

The General Assembly has already granted Albemarle enabling authority to pursue such a program, which would allow the county to require a certain percentage of units be rented or sold at affordable prices to households at 80 percent or lower than the median income. This requirement would be triggered by a rezoning or a special use permit. 

Pethia’s presentation described how an Affordable Dwelling Unit program would work differently than current practice

Supervisors adopted the Housing Albemarle plan last July but delayed much of the implementation until these details could be worked out. 

Before they got too deep into the conversation, Pethia said the U.S. Department of Housing and Urban Development has now released updated calculations for area median income for 2022. 

“That is now $111,200 annually and to put that into perspective, that is a 19 percent increase over last year’s area median income increase,” Pethia said. 

The median income for the Washington metropolitan area is $142,300 and the median income for the Lynchburg metro is $78,900.  We’ll come back to this in future stories about housing. (find the calculations for your favorite metro area)

Pethia said after the work session in February, staff opted to come forward with the affordable dwelling unit program that is authorized under state code. 

“And the enabling legislation really doesn’t place many restrictions on what the county can do and what that program looks like,” Pethia said. “It does require we provide density bonuses but beyond that we are pretty open in the percentage of the affordable unit set-asides that we may require, the depth of that unit affordability, the length of the affordability for those units, and we also have the opportunity to include additional incentives within that ordinance above and beyond the density increases.”

Pethia said there are about 500 such programs across the United States. Commonalities between them include:

  • An identification of how many units the locality needs to be affordable
  • standardized amount per unit for developers to pay into a fund rather than build units
  • The right for the locality or its designee to purchase or rent affordable units that are actually constructed. 
View the presentation

Several localities in Virginia have such a program, such as Loudoun County. 

“They adopted their ordinance in 1999 and do require 6.25 to 12.5 percent of the units in projects to be affordable housing,” Pethis said. “Those units need to be affordable for 15 to 20 years depending on whether they are for sale or rent.” 

Pethia said around 2,500 units have been created under this policy in Loudoun. Fairfax County has a similar ordinance and has created nearly 3,000 units. 

For Albemarle, Pethia said county staff are recommending density bonuses, requiring 20 percent of total new units to be affordable as per Housing Albemarle, allowing non-profits to purchase “affordable” units for which the developer can’t find a qualified buyer, and a cash-in-lieu fee is a developer doesn’t want to build the units. 

Such a program is not yet ready and Pethia wanted feedback on whether they should proceed. 

Supervisor Ann Mallek had this question. 

“Is there a way that we can put a hold on new applications until we get this process adopted?” Mallek said. “I’m very concerned that another 5,000 units will come in in application that we will somehow be forced to accept the applications and then we will lose the opportunity to get a much better result.” 

Supervisor Bea LaPisto-Kirtley said she supported the idea of the creation of a waiting list of people and families who are eligible to rent or purchase affordable units due to their income level. 

“The waiting list would be extremely important to have a waiting list otherwise I can see this whole project failing if we don’t have a waiting list of qualified income buyers,” LaPisto-Kirtley said. 

Supervisor Ned Gallaway said that he did not want to see a list of stiffly-written incentives that might preclude flexibility. 

“I hope we don’t get caught in the trap of saying that even if we put an example of incentives our, or encouraged incentives, or whatever the wording is, that we’re saying that that’s it, and that we have a process in place that allows for consideration of other incentives,” Gallaway said. “Each project will be different. Each spreadsheet is different.” 

Gallaway also supported the cash-in-lieu program in order to be able to pay more funds into the county’s affordable housing trust rather than rely on surpluses. 

A more detailed plan will come before the Board of Supervisors for a work session in August followed by a public hearing in September. 

Before you go: The time to write and research of this article is covered by paid subscribers to Charlottesville Community Engagement. In fact, this particular installment comes from the May 19, 2022 edition of the program. To ensure this research can be sustained, please consider becoming a paid subscriber or contributing monthly through Patreon.

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