Affordable housing and inclusionary zoning study examines paths to inclusive communities

Inclusionary zoning—programs that encourage the creation of affordable housing units when new development occurs via developer incentives and zoning bonuses—first emerged outside of Washington, D.C. and San Francisco in the mid-’70s. But since 2000, the use of these tools to build more inclusive communities has skyrocketed.

The rapid expansion led researchers Emily Thaden and Ruoniu Wang of the advocacy group Grounded Solutions to attempt to get their arms around how inclusionary zoning is and isn’t working in this country; how it’s being set up, differences among local, state, and federal programs, and trends that may help show where such programs are headed in the future, and how to make them more efficient.

According to their new study, Inclusionary Housing in the United States: Prevalence, Impact, and Practices, released by the Lincoln Institute of Land Policy, these policies have rapidly spread across the United States in recent years. Roughly 70 percent of such programs have been adopted since 2000, including 72 in the last six years, with more than a dozen under consideration. In the most comprehensive study of its kind, Thaden and Wang identified approximately 886 jurisdictions in 25 states that have policies in place responsible for nearly 200,000 affordable housing units and $2 billion in fees (both are likely underestimates due to missing data at the local level).

Cataloging and understanding the breadth of such programs, which ask developers to reserve a certain percentage of a new housing development as affordable, wasn’t easy. Perhaps the most important aspect of the research was bringing together disparate data sets to create a fuller picture of inclusionary zoning.

But Thaden and Wang’s work also led to some interesting findings about how these programs have worked, and the areas of inquiry needed to design better programs in the future.

The landscape, not surprisingly, was very diverse. Inclusionary zoning programs differ wildly across the country, varying in a number of key ways: mandatory versus voluntary contributions, a focus on homes verses rentals, on-site construction versus fees for additional unites elsewhere, and programs that target certain income groups and geographic areas (i.e. specific neighborhoods versus entire cities). The types of incentives given to developers vary considerably, as well.

The research found that programs also differ considerably across different states: localities in New Jersey, California, and Massachusetts, all of which have state-wide inclusionary zoning policies, account for nearly 80 percent of such programs in the U.S.

While Thaden and Wang didn’t reach conclusions about the perfect program, arguing that local needs requires a variety of approaches, they did find that local programs tended to be structured for better long-term results than state or federal programs. Most federal affordable housing programs cover a five- to 30-year window, meaning they only require affordability be considered for that time frame. Many local programs were more robust, lasting 40 years or more in many cases.

“The embrace of long-term and lasting affordability requirements by local governments illustrates their commitment to preserve the affordable housing stock in their communities as well as the more prudent use of public and private investment in affordable housing,” wrote Thaden and Wang.

The authors felt that city staff and stakeholders are either uncertain about the impact of these types of policies on development, or without comparisons or data, end up “reinventing the wheel” instead of learning from other localities with more experience with the issue. They hope this data is the first step in research that offers guidance and helps shape more thoughtful policy.

The study didn’t answer every question about the impact and efficacy of such programs—can proper fee structures do a better job of pushing developers to add housing in asset-rich neighborhoods? What’s the relationship between the relationship between the monetized value of incentives and the production of affordable housing?—but helps set a baseline for future research and inquiry. In addition, chronicling how different localities ensure compliance and upkeep can help future policymakers design more and better means of inclusionary zoning, and ideally, better cities and neighborhoods for everyone.