Charlottesville City Council gives direction on affordable housing spending

In March 2021, Charlottesville City Council adopted an affordable housing plan that called for a new Comprehensive Plan and a new zoning code to reduce barriers to new construction. The plan also called for a moral commitment to spending at least $10 million a year on housing for at least ten years.

Every budget passed since then has met or exceeded that commitment with pushes from at least one City Councilor that the city needs to spend even more. Every year, the city puts out a request for developers who may want to use municipal dollars to help subsidize rents or sales prices.

On January 5, 2026, Charlottesville City Manager Sam Sanders briefed City Council on three submissions that came through in the latest cycle.

“They are submitting this information without any expectation of funding,” Sanders said. “They are invited to identify a request for funding so that we have some sense of what it is that they are looking for us to do.”

In general, the affordable housing plan also recommends city investments go toward helping households with incomes toward the lower end of the area median.

This year’s requests are:

• Community Services Housing asked for $900,000 to renovate 40 existing units with half targeted between 40 percent and 50 percent of area median income (AMI) and 20 units at 60 percent. Staff put the highest priority on this request.
• Brick Lane Better Communities sought $1.75 million to assist with redevelopment of the Holiday Inn on Emmet Street into 192 units with 19 of them reserved for households below 60 percent of AMI. That amount is required anyway under the city’s inclusionary zoning rules. Staff put the medium priority on this request.
• Preservation of Affordable Housing once again requested funds to help with the financing of construction of an 170 unit building at 1000 Wertland Street that would have all 60 units reserved for 60 percent of AMI. Staff put this as the lowest priority. This is one of three sites the University of Virginia has agreed to donate land for affordable housing projects. In this case, the land belongs to the University of Virginia Foundation. UVA has previously stated they will not contribute financially to the project.

Councilors all indicated support for the Community Services Housing funding, but had some debate over the other two.

Councilor Jen Fleisher said she would support some level of funding for 1000 Wertland because the location would mean someone could live there without a car.

“I’ve seen UVA raise a million over than they need in capital projects before,” Fleisher said. “So I have faith that they can maybe do that here if maybe we contributed.”

City Councilor Natalie Oschrin said the location for the 1000 Wertland project is ideal and suggested talks with UVA might lead to it moving forward.

“If there’s time, I mean, it’s worth negotiating,” Oschrin said, “Not necessarily if it’s going to be straight cash, but like what other alternate options do they have to make this process project better.”

Mayor Juandiego Wade said he would also support negotiations.

Fleisher said she could support the Brick Lane project as well given the wide range of incomes that would be served in the conversion.

City Councilor Michael Payne said he thought the Holiday Inn project might go forward even without city funding and that ten percent of units below 60 percent AMI would not be enough to get his vote.

“I don’t think it would be a good investment for the city at those AMI levels,” Payne said. “The 60 percent would be required no matter what.”

Payne said he would prefer the city purchase existing housing stock that is currently affordable rather than move into new construction. He suggested one place to look would be Hearthwood on Michie Drive which could lose affordability requirements in the near future when low-income housing tax credits expire.

“One thing I’m really thinking about is the fact that Hearthwood’s affordability period is going to be ending,” Payne said. “That’s 200 units, I think over 300 people who live there who are going to be at immediate risk of displacement.”

Sanders said that is on his mind as well and one potential is to use a contingency fund in the capital improvement program that comes from prior surpluses.

The next question Sanders had for Council regarded Kindlewood, the name for the multi-phase redevelopment of the old Friendship Court into new units. The overall agreement between the city and Piedmont Housing Alliance calls for there to be 425 places to live when the work is complete.

Phase 4 is being planned now and the city has already programmed $4.5 million for what was to have been 130 units. Sanders said there is a funding gap.

“Available funding today will allow for 85 to 95 units,” Sanders said. “And if that happens, that means the delivery of units total 380 to 390, falling short of the original agreement.”

Piedmont Housing Alliance is seeking an additional $3 million, but Sanders said an alternative would be to lower the total amount. Deputy City Manager James Freas explained why the cost has increased.

“A component of that is that to get to the level of density, get basically that 130 units onto that portion of the remaining property, you pretty much have to go into structured parking,” Freas said.

Wade said he could live with the lower number of units.

“I’m not in the camp of the additional funds for that,” Wade said. “ I would rather put it towards another affordable housing project.”

Payne said he would like to see more information about phase 4 and reminded Council that the project was developed with input from residents. He said they still need to be involved.

“A huge part of the Kindlewood project is the approach of residents being directly involved in decisions and that flowing from one of the lessons of Vinegar Hill of involving community members directly rather than making decisions for them,” Payne said. “I think if information is given to residents, they’re smart enough to understand the trade-offs.”

Payne said he could support a fewer number of units given that the plans were made during the pandemic and construction costs have increased.

Sanders will reveal his recommended budget on March 2.

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