N-FBC Affordable Housing Amendments: 1. Area Median Income Limits - - PowerPoint PPT Presentation

N-FBC Affordable Housing Amendments:

• 1. Area Median Income Limits for Ownership Units
• 2. Cash Contribution for Commercial Uses

NAIOP

February 26, 2020

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Affordable Housing Master Plan

• Goal 1.2.1 - Incentivize the

production of moderately- priced ownership housing through land use and zoning policy

• AHMP recommends

encouraging the production

• f 80% to 120% Area Median

Income (AMI) units

Background - Guidance for Housing Ownership

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Area Median Income (AMI) – Current Levels (2019)

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Household Size 60% of Median 80% of Median 100% of Median 120% of Median 1-Person $51,000 $68,000 $85,000 $102,000 2-Person $58,260 $77,680 $97,100 $116,520 3-Person $65,520 $87,360 $109,200 $121,300 4-Person $72,780 $97,040 $121,300 $145,560 5-Person $78,660 104,880 $131,100 $157,320 Source: Median Income as adjusted by US Department of Housing and Urban Development

Existing N-FBC Requirements

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Consistent AMI limits for Rental and Ownership Housing

• Affordable units up to 60% AMI
• 30-Year term
• Alternative AMI options dependent
• n site location in East or West

Columbia Pike

Challenges of Limiting Affordable Units to 60% AMI

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For Ownership Units:

• Limited pool of eligible purchasers
• Tight mortgage credit requirements
• Ability to keep pace with yearly increases in condo fees,

utilities, taxes, etc.

• Ability to pay for unforeseen maintenance/repair expenses

Challenges of Limiting Affordable Units to 60% AMI

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Example: 3-person Household with income of $65,520 (60% AMI):

• $65,520/12 months = $5,460 monthly gross income
• Assumed Debt:
• Car loans and credit cards: $500/month
• Student loans: $300/month
• Mortgage for 2br condo in Arlington: $1,800/month

(includes condo fees, taxes, etc.)

• Total Debt: $2,600/month
• Resulting Debt-to-Income Ratio (DTI): $2,600/$5,460 = 48%
• This household would not qualify for a traditional mortgage

N-FBC (Ownership) Development Projects

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• Carver Homes

(Sold 2017)

• 6 ADUs up to 60% AMI
• No N-FBC condominium developments anticipated though 2020

Pike Development History (2003-2019)

• 19 total developments approved
• Over 3,400 total residential units
• Of the 3,400 total residential units,
• nly 150 were ownership (or 4%)

Neighborhoods FBC Project Summary

• 4 total developments approved
• Total of 885 residential units
• 468 market rate units
• 417 affordable units
• Of the 417 total affordable units,
• nly 6 were ownership (or 1%)

Past FBC AWG Feedback

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Staff met with the FBC AWG in June 2017 to discuss an earlier version of this amendment:

• Original recommendation for ownership units included:
• At least half of the units to be up to 100% AMI; and
• The remainder to be up to 120% AMI
• FBC AWG expressed concerns the proposal limited access to

affordable units earning up to 80% AMI

• Staff, at the time, was asked to consider lowering the range to

capture residents from the lower AMI levels

(New) Proposed Affordability Tiers for Ownership Units

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Total Number of Affordable Units Required Units Up to 80% AMI Units Up to 100% AMI Units Up to 120% AMI 1 1 2 1 1 3 1 1 1 4 2 2 5 2 2 1 6 2 2 2

• No less than 1/3 of required units shall be affordable to households earning

up to 80% AMI, no less than 1/3 shall be affordable up to 100% AMI, and the remainder shall be affordable up to 120% AMI.

• If there is only one required unit, it shall be affordable up to 80% AMI.
• If there are two required units, one shall be affordable up to 80% AMI and
• ne shall be affordable up to 100% AMI.

Hypothetical Examples Utilizing This Tiered Approach

(New) Proposed Affordability Tiers for Ownership Units

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Hypothetical example assuming recent N-FBC project in Arlington View was proposed as market rate condos:

• Existing Units: 33
• Proposed Units: 77
• “Net Gain” of Density: 44 units
• Minimum Affordable Requirement:
• 2.3 factor applied to 44 unit ‘net gain’
• Minimum of 11 affordable units

Existing N-FBC Requirements:

• All 11 units would be at 60% AMI levels

Proposed N-FBC Requirements:

• 4 units would be at 80% AMI
• 4 units would be at 100% AMI
• 3 units would be at 120% AMI

Recommendations for Ownership Units

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• Establish equally tiered affordability levels up to 80% AMI,

100% AMI, and 120% AMI

• Extend affordability term from 30 years to "life and use of the

existing improvement as a residentialdwelling unit"

Affordable OWNERSHIP Units Existing N-FBC Proposed N-FBC AMI Level 60% AMI Tier at up to 80% AMI, 100% AMI & up to 120% AMI Affordability Term 30 Years For the life and use of the existing improvement as a residential dwelling unit Affordable RENTAL Units Existing N-FBC Proposed N-FBC AMI Level 60% AMI 60% AMI (no change) Affordability Term 30 Years 30 Years (no change)

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Cash Contribution for Commercial Uses

• The N-FBC affordable housing requirement currently does

not address commercial development scenarios.

• Recent proposal for a site in Foxcroft Heights contemplated a

hotel development (among others)

• There are seven sites within the N-FBC Revitalization District

that could redevelop as commercial uses.

• Designated as “Urban Mixed Use” or “Urban Storefront”

frontages in the Building Envelope Standards

Background - Commercial Cash Contribution

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• When commercial uses are proposed, the same commercial cash

calculation as required in Site Plan projects - Zoning Ordinance section 15.5.8.C.4 (“base ordinance calculation”) should apply.

• 2019 Cash Contribution Rates* are:
• $2.01/SF of Gross Floor Area (GFA) for the first 1.0 Floor Area Ratio (FAR);
• $5.36/SF of GFA above 1.0 FAR.
• For mixed-use residential projects, the existing affordable (on-site)

unit contribution would apply to the residential portions of the

• development. The cash contribution will apply only to the

commercial portion of the development.

• A cash contribution will not be allowed for residential uses.

* Indexed to the Consumer Price Index for Housing in the Washington-Arlington-Alexandria MSA.

Recommendation – Commercial Cash Contribution

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Recommendation – Commercial Cash Contribution

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Hypothetical Foxcroft Heights site on Orme St and Columbia Pike

Hypothetical example using 53,300 sq. ft. site in Foxcroft Heights, designated with a “Urban Mixed Use” BES frontage, and currently occupied by 12 residential units Scenario 1: Mixed-Use Project

• 30,000 sq. ft. of retail & 140 residential units
• 39 on-site affordable units required
• $60,300 cash contribution required

Scenario 2: Hotel Project

• 161,000 sq. ft. of commercial space
• No on-site affordable units
• $684,400 cash contribution

Existing aerial image Neighborhoods Area Plan Rendering

Next Steps

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• February 2020: Staff work on text amendment language
• March 2020: Zoning Committee of the Planning

Commission (ZOCO) and Housing Commission (info item)

• April 2020: Request to Advertise
• May 2020: Planning Commission, Housing Commission

(action item), and County Board meeting

Backup Slides

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Western Subarea Regulating Plan

Mixed-Use Frontages - NFBC

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Central Subarea Regulating Plan

Mixed-Use Frontages - NFBC

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Eastern Subarea Regulating Plan

Mixed-Use Frontages - NFBC