What about Inclusionary Zoning?

I should have been more pleased than I was after the City Council meeting on 8/ which brought the Cleveland-Holloway parcels back into the normal public process. What bothered me about the meeting (aside from the patronizing attitude of Catotti and Cole-McFadden) was the ongoing pablum about the city's valiant fight for affordable housing. The trouble with this story is that the empress has no clothes; if our representatives really cared about affordable housing - rather than funding their favorite non-profits - we would have an inclusionary zoning policy.

Inclusionary zoning essentially mandates that all new development in a jurisdiction, typically over a miniumum threshold (such as 50 units) includes a certain number of units that meet affordability goals for some percentage of the area median income. This is the most basic description - every policy varies to some degree depending on the jurisdiction. While 'voluntary' programs exist, they are ineffective.

Many jurisdictions have avoided inclusionary zoning policies because they want the playing field to be even amongst various municipalities. They fear that if they enact inclusionary zoning, growth will flee to another municipality.

Inclusionary zoning certainly hasn't hurt Chapel Hill's growth. (Actually Chapel Hill doesn't have inlcusionary zoning per se - they require approval of all rezonings to be consistent with the comprehensive plan, and the comprehensive plan calls for affordable housing.) Although you wouldn't know it, a big development like Meadowmont includes affordable units. The units are managed through the Orange County Land Trust, which helps assure that the units are permanently affordable. Predictably, other municipalities in North Carolina with effective planning departments, such as Davidson, NC, also have inclusionary zoning. (Davidson requires 12.5% of new units to be affordable.)

The traditional method of addressing the market failure in affordable housing was for the Federal government to build public housing units. Primarily because of the intense concentration of poverty, this turned out poorly. But the Federal government also migrated during the 1970s and 1980s to providing Community Development Block Grants (CDBG) to local governments to provide housing - and direct funding to housing companies that had non-profit status and a stated commitment to providing low-income housing.

The next realization - which occurred during the late 1980s and 1990s, after Wla w book The Truly Disadvantaged was that we had created, and were continuing to create economic segreation through housing policy. While we were creating low-income housing, this housing continued to be geographically uncoupled from market-rate housing. The geographic segregation of housing by income continued to create areas of concentrated disadvantage.

This was the impetus for the 1990s HOPE VI program - a new wave of housing construction directly funded by the government, designed to replace the concentrated public housing of the mid-20th century with mixed-income, owner-occupied and rental, well-designed housing. It has been a very successful program - now defunded by the Bush administration.

Thus low-income housing, which had been shunted to housing contractors during the 1970s and 1980s, once again began to fall under the purvey of urban planning.

The other strategy for correcting the market failure that created geographic/economic segregation was to create policy either requiring or inducing large scale housing developers to build more affordable units. This might be enacted through inducements, such as density bonuses (which allowed developers to build at higher densities if they included affordable units), or requirements, such as inclusionary zoning.

The evidence is that inclusionary zoning is effective in producing affordable units, with caveats . Generally, the units built do not address very low-income (VLI) housing needs..

In Durham, while we have worked to build mixed-income communities with the HOPE VI program and the Barnes Avenue project, we have not effectively addressed the old issue of geographic and economic segregation perpetrated by the for-profit and non-profit housing companies.

One of the problems with this is that a significant portion of our council seems to be under the impression that non-profit businesses are somehow inherently more noble than for-profit businesses, rather than acknowledging that both types of businesses are, in-fact, in business to sustain themselves as well as produce their product. As such, non-profit housing providers have a vested interest to produce enough product to continue to pay the salaries of their employees and garner further profits/funding. Thus, the imperative of an affordable housing non-profit is to produce more low-income housing. If there was no longer a need for affordable housing - or this housing was being provided by the private sector - the non-profits lose business and need to lay people off. There is thus a perverse incentive for the affordable housing businesses for the need to be dire and unrelenting.

I obviously take a far less romantic view of non-profit businesses. I think they can be populated by good people doing great things, good people doing misguided things, and not-so-good people doing utterly self-serving things - just like for-profiit companies. For the most part, I think our affordable housing businesses in Durham are staffed by really good people who believe in what they do - but who often have a far too-circumscribed view of the elements of a sustainable and viable city.

Which should be the job of the city/county government. I don't take a particularly romantic view of government or free market either. From my perspective, each has its good points and bad points. Ideally, these complement each other. The free market does the things that the government is particuarly bad at


(Courtesy Durham County Library)
(Courtesy Duke Archives)