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Home My Public Portal About2020_11-23_Staff Memo_AffordableHousing ADU-Residential DevelopmentMeeting Document Date of Council Meeting: November 23, 2020 TOWN OF LEESBURG TOWN COUNCIL WORK SESSION Subject: Affordable Housing/ADU- Residential Housing Staff Contact: Susan Berry Hill, Director Council Action Requested: Work session discussion requested by Council regarding affordable housing. Staff Recommendation: Staff recommends no further discussion or action regarding affordable housing issues at this time. However, staff recommends discussion of affordable housing within the context of the draft policy in the Legacy Leesburg Town Plan in the spring of 2021. This would also include discussion of implementation strategies for addressing unmet housing needs in Leesburg. Commission Recommendation: None at this time. Fiscal Impact: None at this time. Work Plan Impact: None at this time. Executive Summary: On October 26, 2020, Council requested a work session discussion of the Town’s current policy on affordable housing and regulatory requirements for developers who propose residential projects. Background: The Town Plan contains policy for housing in Chapter 7. The housing goal states: Leesburg will have a high-quality housing stock that accommodates future population and workforce, and will be diverse in terms of building types and affordability levels. The housing objectives in the Town Plan emphasize housing to meet all income levels and diversity of housing types. The objectives stress that the Zoning Ordinance should permit a diversity of housing types and not restrict affordability through excessive lot size requirements or other regulation. Diversity in housing should address accessibility and special needs populations, first-time buyers, and empty nesters. The provision of diverse housing should not come at the expense of converting vacant land that is designated for business uses nor should it convert exiting non-residential buildings for residential purposes. These Town Plan policies and objectives provide the basis for regulation in the Zoning Ordinance to address affordable housing. In the 2008 timeframe, Council adopted provisions in Article 3 of the Zoning Ordinance for inclusionary zoning with new residential development. Section 3.17 contains these requirements and requires developers to provide a percentage of proposed housing as affordable housing. Key provisions include: Applies to projects that are 24 units or more, receiving public utilities, and are at least 1 unit/acre. Bonus density of 20% can be requested when 12.5 % of the units are provided as affordable. 50% of ADU’s shall be provided with 50% of the market rate units. 100% of ADU’s shall be provided with 75% market rate units. The Town entered into a Memorandum of Agreement (MOA) with Loudoun County on May 29, 2009 to administer the Affordable Dwelling Units (ADU’s) that have been accepted through residential land development proposals in Leesburg. This agreement committed that the Town would accept no more than 30 affordable units per Section 3.17 of the Zoning Ordinance and that the County would agree to administer 30 units. Administration of the ADU program includes, but is not limited to, identifying general specifications and construction costs; identifying for-sale costs and rental costs; determines the eligibility of applicants to buy and rent units; and undertakes modifications to regulatory provisions governing affordable units as needed. Initially, the Town accepted ADU’s primarily in the PMW Farms development. As the number of ADU approached the 30-unit cap in the MOA, Town staff found that application of the ADU Ordinance in Section 3.17 had to be suspended until such time as the cap was increased in the MOA. On March 26, 2018, the MOA was updated by the Town and Loudoun County to increase the number of units the County would administer up to 120 units. Today, projects that have proffered ADU units include PMW Farms, Church and Market, and White Oak. The ADU ordinance continues to be applicable to all residential projects per the criteria in the Ordinance. Staff has not identified other issues with the ADU ordinance, and will continue to administer the ordinance provisions consistent with the MOA with the County. The broader issue of affordable housing is increasingly problematic in Loudoun County and the Towns. It was a key issue during the Loudoun County update of the comprehensive plan. The adopted 2019 Comprehensive Plan contains policy language to heighten the importance of the issue, and calls for a strategic approach to address housing affordability. As an implementation step, in 2020 Loudoun County established an office dedicated to addressing unmet housing needs through the development of a strategic plan. The County has begun their process by collecting and analyzing data about housing needs in Loudoun County. Housing needs are measured in terms of housing costs as a percentage of Average Median Income (AMI). AMI in Loudoun County is $126,000. The housing needs continuum spans from the greatest needs including homelessness and those residents who need federally supported housing vouchers. The spectrum then spans to programs that address housing needs that are often labeled “affordable”, “work force”, or “attainable” housing. This portion of the housing needs spectrum ranges from 30-70% of AMI. The County is developing an Unmet Housing Needs Strategic Plan to address all housing needs. The goal of the Unmet Housing Needs Strategic Plan is to define how the county will address unmet housing needs in a systematic and comprehensive way with integrated programs. They note that there is no one tool that will address all the housing needs. Specific tools should be selected to meet the specific needs. Attachment 2 is a one-page description of Loudoun County’s Unmet Housing needs initiative. Like the County, work on the Legacy Leesburg Town Plan project has identified affordable housing as an issue in Leesburg. The project team includes a consultant who has provided general market information and analysis for Leesburg regarding housing. The market study found that there is an affordability gap in Leesburg. Given income levels of renters in Leesburg, rents are about double what is considered affordable. The inventory of residential homes for sale continues to be low forcing up the price of housing and limiting affordability. Public input received through the Legacy Leesburg Town Plan project validated the market study and indicates that housing affordability is a big concern to many people. Empty nesters are finding limited existing housing opportunities to downsize and remain in Leesburg. Millennial children of empty-nesters noted that they cannot afford to move to Leesburg to be closer to parents. Further anecdotal input also indicates housing affordability is a concern for businesses in Leesburg who have a problem hiring staff due to the fact that workers cannot afford to live here. The Town’s Economic Development Department staff have heard from the retail, restaurant, and hospitality sectors that there is not enough affordable housing in Leesburg. As such, this will be a key issue identified in the Legacy Leesburg Town Plan, and it will likely be identified as an action step to work on after the Plan is adopted. Proposed Legislation: None at this time. Draft Motions: 1. I move to resume discussion of unmet housing needs in Leesburg within the context of the review of the Legacy Leesburg Town Plan in 2021. OR 2. I move an alternate motion. Attachments: First Amendment to the MOA between Loudoun County and Leesburg to Administer ADU’s in Leesburg, dated March 26, 2018. Loudoun County Unmet Housing Needs initiative Affordable Housing /ADU – Residential Development November 23, 2020 Page 3