Officials considering incentives on affordable housing

Officials considering incentives on affordable housing

Nearly 800 residential units now being proposed citywide

PAWTUCKET – Finalizing local rules on affordable housing will take plenty of creative thinking, say those doing the legwork.

City Councilor Terry Mercer, who heads up the ordinance subcommittee and ad hoc economic development and neighborhood improvement committee, which are meeting together to discuss affordable housing requirements, said the joint committee is “nowhere near” ready to finalize a proposal.

On the table are potential incentives to compensate developers for creating more affordable housing, said Mercer.

At a May 15 workshop, the committee heard from for-profit and nonprofit developers, he said, and the for-profit developers offered plenty of concern about a proposed 10 percent affordable housing mandate.

The city is considering developing new requirements for the Transit-Oriented Development (TOD) zone around a future new train station off Main Street, but could also expand those requirements citywide.

According to Mercer, for-profit developers Colin Kane, Aurora Leigh and Seth Zeren all offered feedback that a 10 percent requirement would “put a damper on the likelihood of projects moving forward,” either within the TOD or citywide. They came at it from a standpoint of economic equality, he said.

“Many of their projects don’t quite pencil out as it is,” said Mercer, never mind with additional requirements.

Charging $2,400 or $2,500, even for a very nice unit in Pawtucket, simply isn’t feasible, according to the developers, and there’s no comparison here to Boston.

“They’re not paying regardless of how nice they are,” he said.

Nonprofit developers, including Brenda Clement of Housing Works R.I. and Andrew Pierson of Pawtucket Central Falls Development, were more enthusiastic about having a requirement for a minimum amount of affordable housing, calling for balance and equity while also acknowledging the issues facing developers.

At the May 15 meeting, officials got an update on the number of residential units that are currently in the pipeline for the city. Planning Director Sue Mara said there are four projects currently with building permits, involving 102 total units, and another nine projects through the planning and zoning process, for another 683 units.

Zeren said at the May 15 meeting that he’s not a fan of inclusionary zoning requiring affordable housing. The symbolism is powerful, he said, but the cost hurts development.
Clement said if there are incentives for local inclusionary housing, then there need to be local benefits.

Pierson noted that there are $50 million in public subsidies for development around the train station, so there needs to be a public benefit. He said he understands incentives are needed.

Kane said he has done three projects with inclusionary affordable housing. Pawtucket has plenty of it, he said, and doesn’t need more. The math doesn’t work in Pawtucket, he said. Private developers can’t be responsible for affordable housing.

Leigh, who is doing a number of residential projects around the coming train station, said private developers are taking the risk with their projects and need higher-income residents. Pawtucket has plenty of affordable housing now, she said.

Mara noted that the city is close to the state goal of 10 percent affordable housing.

Councilor Meghan Kallman, an advocate for more affordable housing and against gentrification forcing lower-income residents out, said many city residents can’t afford $900 for monthly rent. She’s seeking more information on available options.

Mercer said he would like more information on off-site offsets and incentives used elsewhere, including Fall River, Mass.

A number of options are available, said Mercer, including possible extensions of tax treaties and easing density requirements. One possible option being discussed is to offer up city-owned foreclosure properties in exchange for development of affordable units.

For affordable housing, residents have to be at 80 percent of the area median income to qualify for it.

The committee will likely meet one more time next week before hopefully coming up with recommendations, said Mercer.