Boston’s affordable housing development policy has resulted in the construction of more than 3,600 income-restricted condominiums and apartments since it was enacted in 2000.
The one-size-fits-all approach is no longer effective to address the region’s current housing affordability crisis, according to city officials who unveiled changes that would increase fees for developers who don’t want to include affordable units on-site. The new policy applies to proposals filed after Jan. 1.
The new inclusionary development policy (IDP) divides the city into three zones based upon the top, middle and bottom third of median sales prices from 2013 to 2015, using data supplied by The Warren Group, publisher of Banker & Tradesman.
“It’s an opportunity for us to capture the benefit in every community, rather than treat somebody in Jamaica Plain the same as you treat a downtown high-end luxury tower,” Mayor Martin Walsh said at a press briefing Tuesday. “It’s really about maximizing the opportunities.”
The minimum percentage of on-site affordable units in new developments will remain at 13 percent throughout the city, but would rise from 15 to 18 percent in two-thirds of the city if developers opt to pay into a fund to support generation of affordable housing off-site.
The current $200,000 off-site fee will rise to $380,000 per unit in zone A, which includes the highest-priced neighborhoods from the Fenway to the Seaport, as well as harborside properties in East Boston and Charlestown.
In Zone B, which includes comparatively moderate-priced neighborhoods such as Allston, Jamaica Plain and South Boston, the fee would rise to $300,000. The fee would remain at $200,000 in the rest of the city, known as Area C. But it would open the possibility that rentals would be made available in that area for tenants making up to 100 percent of the area median income, up from the current 70 percent cap.
The program currently restricts affordable units to rental households making a maximum of 70 percent of the area median income, or $48,250 for a single-person household and $68,950 for a family of four. Maximum rents for the income-restricted units range from $961 for microapartments to $1,781 for four-bedroom units.
For condos, the income restrictions range from 80 to 100 percent of the area median, with the top range equal to $98,500 for a four-person household. Maximum sales prices for one-bedroom condos range from $173,900 in 80 percent restricted income properties to $225,700 for those at the 100 percent median income range.
The city has collected a total of $79.4 million in payments from developers to support off-site units, with another $39.4 million in payments outstanding. Another $22 million is expected to be paid by developers of projects that have been recently approved by the BRA but haven’t yet broken ground.
A task force and city-appointed consultant, Pam McKinney of Boston-based Byrne McKinney & Assoc. Inc., met with affordable housing advocates and developers over the past six months trying to fine-tune a formula that will maximize affordable housing production without providing financial disincentives for new development.
Walsh has set a goal of permitting 53,000 housing units by 2030 in the city. There are currently 4,000 multifamily units under construction in Boston and developers are seeking permits for thousands of additional apartments and condos, although most of the activity has been concentrated in higher-cost neighborhoods.
“Some of this also is about having developers start to look at other areas of the city,” Walsh said.
