Consultants looking at the financial issues around a proposed change to the city’s inclusionary zoning policy presented preliminary findings to the Somerville Planning Board last night. They told the board that a poorly designed policy could stifle development for as many as four years.
Somerville Senior Planner Lori Massa said that currently the ordinance requires 12.5 to 17.5 percent of units be set-aside while granting density bonuses in most neighborhoods (the exception being the Residence A and Residence B zoning districts, which comprise 60 percent of the city’s land area, according to the RA/RB Report, and which have far smaller affordability requirements). Furthermore, the inclusionary development kicks with projects of eight units or more and reserves housing for people making up to 80 percent of the area median income.
She said that the proposal being considered would raise the top set-aside to 20 percent, add an income tier over 80 percent of AMI and make every fifth unit of affordable housing created be for that third tier.
Eric Halvorsen, a consultant with RKG Associates, presented the research they’ve done on the financal side of affordable development. He said that increasing the percentage of affordable units set-aside in new projects would have a big impact on small developers, while decreasing the threshold for the policy from eight to six units would encourage small projects — saying that the current policy had already led to a number of seven-unit developments.
Among other findings, Halvorsen said that parking had a signifigant impact on the financial equation, with the cost of building it getting up to $30,000-$35,000 per space. He said that right now the Somerville market was normalized to existing regulations and changing them could scare off developers, and potentially reduce property values because they wouldn’t be willing to pay current asking prices for developable land.
“I don’t see a reduction in property values being a horrendous thing for market rate units in this city,” said board member Michael A. Capuano.
Massa said that to make the increases in inclusionary units more palatable, the staff was looking at a policy where the units would be added on top of the density bonus.
The Planning Board also approved three planning amendments for Partners Healthcare’s offices at Assembly Square, the only one of any signifigance being approval of a childcare center for employees on Grand Union Blvd.