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HomeMy Public PortalAbout10-14-2014 Housing_Text_Amendment for 14 October 2014_201409221027302732TOWN OF WATERTOWN Department of Community Development and Planning PLANNING BOARD Administration Building 149 Main Street Watertown, MA 02472 Phone: 617-972-6417 Fax: 617-972.6484 wwwwtertown-ma.gov Planning Board Report Board Members: John B. Hawes, Jr., Chairman Linda Tuttle -Barletta Jeffrey W. Brown Fergal Brennock Neal Corbett This Report provides the Planning Board's recommendation to the Honorable Town Council for the Council's public hearing on Zoning Ordinance text amendments to change the Affordable Inclusionary Zoning requirement of Section 5.07. ZONING AMENDMENT: Section 5.07 of the Ordinance DATE OF FIRST READING: RECOMMENDATION: DATE OF PLANNING BOARD HEARING: I. PUBLIC NOTICE A. Procedural Summary: As required by the Watertown Zoning Ordinance § 9.22, notice was given as follows: August 12, 2014 Adoption of Amendment September 8, 2014 • Published in the newspaper of record (Watertown Tab) on 8/22/14 & 8/29/14; • Posted at the Town Administration Building on 8/14/14 and, • Mailed to Parties of Interest on 8/14/14 B. Planning Boara Public AVotice "Consider a recommendation to the Watertown Town Council to change affordability requirement for projects having more than five (5) residential units from ten percent (10%) to twelve and a half percent (12.5%), and to change gross floor area of affordable units from a defined minimum size to the minimum square footages as required by the Department of Housing and Comnumity Development. The proposed text amendment would also make house -keeping clarifications such as correcting spelling errors," II. DESCRIPTION A. Nature of the Request The Watertown Housing Partnership (WHP) reviewed the recommendations of the 2014 Housing Production Plan (HPP), and at their meeting on May 20, 2014, discussed the proposed text changes implementing the adopted HPP and reconunended the following initial actions with a vote of 5-0, with the understanding that there are other implementation steps to follow: • Change affordability requirement from ten percent (10%) to twelve and a half percent (12.5%) for Zoning Amendment — September 10, 2014 Inclusionary Zoning Planning Board Report all projects with more than five (5) residential units. This would increase the percentage of units required and remove the unit exemption for small mixed use projects of 6 to 15 units to be the same as other housing projects • Require the minimum size of any affordable unit to be within 20% of the median size of like units but not be smaller than the minimum size set by the Massachusetts Department of Housing and Community Development (DHCD minimums are currently 1 bd= 600 s.f., 2bd= 850 s.f. and 3 bd = 950 s.f.) • Make housekeeping clarifications such as correcting spelling errors and abbreviations III. ANALYSIS AND FINDINGS The Housing Production Plan lays out methods to bring Watertown closer to the State's goal of having ten percent of the Town's housing stock as affordable. Watertown is currently at 6.5%. If the affordable housing set aside for residential projects is not increased, Watertown will never catch up to the State's goal, as the overall pool of housing stock will also increase. Changing the affordable set aside requirement from 10% to 12.5% does not create a substantial impact on developers, and helps implement the Town's goal of 10% affordable units. The proposed changes to unit sizes would still ensure that affordable units be similar in size to market rate units by requiring them to be within 20% of the size of the market rate units within a project. This also allows for our requirements to be more flexible and consistent with State regulations. IV. PLANNING BOARD RECOMMENDATION AND VOTE The Planning Board held a public hearing on the proposed zoning text amendment on September 8, 2014. The Board asked those in attendance for comments. Jennifer Van Campen, Director, MetroWest Collaborative Development, and resident of Watertown submitted a letter in support of the proposed text amendment. She noted an example of a 280 -unit project, that if required to set aside 12.5%, then the Town's percentage of affordable housing would increase from 6.5% to 6.6%. Watertown's Inclusionary Zoning Ordinance is very clear and straightforward. It provides a cheaper, effective and more efficient way to develop residential projects than Comprehensive Pennits, which would require 25% set aside. Councilor Tony Palomba, spoke in favor of the proposed text amendment. Watertown is facing a large number of developments in the next few years. Increasing the set aside to move the needle towards meeting the State's ten percent goal is good. Paul Fahey, Member, WHP, as well as a former Town Council Member and former Planning Board Member. Proposed text amendment strikes a balance for sensible development. The Planning Board voted unanimously in favor (5-0) to recommend adoption by the Honorable Town Council of the proposed text amendments to Section 5.07 of the Zoning Ordinance. Attached to this Report is a copy of the proposed Zoning Amendment showing the proposed language changes. Page 2 of 2 SECTION 5.07 AFFORDABLE HOUSING REQUIREMENTS (a) Intent and Purpose The purposes of this Section are to encourage the expansion and improvement of the Town of Watertown's housing stock; to provide for housing choices for households of all incomes, ages, and sizes; to prevent the displacement of low- and moderate -income residents; to produce affordable housing units in order to meet existing and anticipated employment needs within the Town; to provide opportunities for conventional residential and mixed -use development to contribute to increasing the supply of affordable housing; and to establish standards and guidelines in order to implement the foregoing. (b) Definitions 1. AFFORDABLE HOUSING PROGRAM Collectively, Section 5.07 and other provisions of the Watertown Zoning Ordinance that pertain to the development and preservation of affordable housing in the Town of Watertown. 2. AFFORDABLE HOUSING RESTRICTION A deed restriction, contract, mortgage agreement, or other legal instrument, acceptable in form and substance to the Town of Watertown, that effectively restricts occupancy of an affordable housing unit to qualified purchaser or qualified renter, and which provides for administration, monitoring and enforcement of the restriction during the term of affordability. An affordable housing restriction shall run with the land in perpetuity or for the maximum period of time allowed by law, and be enforceable under the provisions of Chapter 184, Sections 26 or 31- 32 of the General Laws. 3. AFFORDABLE HOUSING FUND A fund account established by the Town for the purpose of creating or preserving affordable housing in the Town of Watertown. 4. AFFORDABLE HOUSING UNIT A dwelling unit that is affordable to and occupied by a low- or moderate -income household and meets the requirements of the Massachusetts Department of Housing and Community Development, Local Initiative Program, for inclusion on the Chapter 40B Subsidized Housing Inventory. 5. AREA MEDIAN INCOME The median family income for the metropolitan area that includes the Town of Watertown, as defined in the annual schedule of low- and moderate -income limits published by the U.S. Department of Housing and Urban Development, adjusted for household size. 6. COVERED DEVELOPMENT Any development required to provide affordable housing in accordance with Section 5.07. 7. ELIGIBLE HOUSEHOLD A low- or moderate -income household that purchases or rents an affordable housing unit as its sole residence. 8. INCLUSION UNIT An affordable housing unit built on the same site as the market -rate units in a covered development under Section 5.07. 9. LOCAL INITIATIVE PROGRAM A program administered by the Massachusetts Department of Housing and Community Development (DHCD) pursuant to 760 CMR 45.00 to develop and implement local housing initiatives that produce low- and moderate -income housing, with or without a comprehensive permit as defined in Chapter 40B, Section 20 through Section 23 of the General Laws. 10. LOW- OR MODERATE -INCOME HOUSEHOLD A household with income at or below 80% of area median income, adjusted for household size, for the metropolitan area that includes the Town of Watertown, as determined annually by the United States Department of Housing and Urban Development (HUD). 11. MARKET -RATE DWELLING UNIT All dwelling units in a development subject to this Section 5.07 that are not affordable housing units as defined herein. 12. MAXIMUM AFFORDABLE PURCHASE PRICE OR RENT A purchase price or monthly rent that complies with the regulations and guidelines of the DHCD Local Initiative Program and the Watertown Planning Board, except that developments subject to Section 5.07(j)(3) shall comply with the maximum purchase price or rent requirements of that section. For homeownership units, the maximum affordable purchase price shall account for the monthly cost of a mortgage payment, property taxes, insurance, and condominium fees where applicable; and for rental units, the maximum affordable rent shall account for the monthly cost of rent and utilities. The household income used to compute the maximum affordable purchase price or rent shall be adjusted for household size, considering the household size for which a proposed affordable unit would be suitable under guidelines of the Local Initiative Program or any successor affordable housing program established by the state. 13. SMALL-SCALE INCLUSION DEVELOPMENT A covered development that provides 6 or more up to 10 dwelling units. 14. SUBSIDIZED HOUSING INVENTORY The Department of Housing and Community Development Chapter 40B Subsidized Housing Inventory as provided in 760 CMR 31.04. (c) Applicability (1) Section 5.07 applies to any development, whether new construction, conversion, adaptive reuse or expansion of an existing structure, involving the creation of more than five dwelling units or more than five (5) lots for residential use, and —to —any mixed -use development involving the creation -of -mare -than -fifteen (15) dwelling -units. Assisted living, outside of the Assisted Living Overlay Zone, Section 5.11, shall be considered institutional and shall be exempt from Section 5.07. Developments may not be segmented to avoid compliance with this Section. "Segmentation" shall mean any development, whether new construction, adaptive reuse or redevelopment, or any division of land that would cumulatively result in an increase by five or more residential lots or dwelling units above the number existing on a parcel of land or contiguous parcels in common ownership twenty-four months prior to the application. Where such segmentation occurs, it shall be subject to this Section as a covered development. A subdivision or division of land shall mean any subdivision as defined in the Subdivision Control Law, G.L. c.41, Sections 81 K-81 GG, or any division of land under G.L. c.41, Section 81P, into lots for Proposed Text Amendments to Section 5.07 of Watertown's Zoning Ordinance Draft as of September 8, 2014 as Recommended by Watertown Housing Partnership and Planning Board Page 2 of 6 residential use. (2) This Section does not apply to the rehabilitation of any building or structure, all of or substantially all of which is destroyed or damaged by fire or other casualty or a natural disaster; provided, however, no rehabilitation nor repair shall increase the density, bulk or size of any such building or structure which previously existed prior to the damage or destruction thereof except in conformance with this Section. (d) Basic Requirements (1) Projects having more than five (5) units:' No special permit for a development requiring a special permit and no building permit for a use permitted as of right, shall be issued for a development subject to this section unless the Petitioner provides at least ton percent (-1-4-°/e) twelve and one-half percent (12.5%) of the total dwelling units in the development as affordable housing as described herein and otherwise consistent with this Section. (2) Nothing in this Section shall preclude a developer from providing more affordable units than the minimum requirements. In no instance shall any permit or special permit approval create less than one affordable housing unit, and for purposes of this Section, any calculation of required affordable housing units that results in the fractional or decimal equivalent of one- half or above shall be increased to the next highest whole number. (3) Affordable units shall be made available to eligible low- or moderate -income households at purchase prices or rents that comply with the Massachusetts Department of Housing and Community Development (DHCD) Local Initiative Program regulations, 760 CMR 45.00, or any successor program as may be determined by the Special Permit Granting Authority (SPGA) in consultation with the Watertown Housing Partnership (WHP). (e) Methods of Providing Affordable Units (1) A covered development with more than five (5) and up to ten (10) units, shall have the option of providing an affordable unit on site or making a cash payment. A covered development with more than ten (10) units shall provide the affordable units on site. However, approval for cash payment in lieu of on -site affordable units may be granted by the SPGA in certain exceptional circumstances. The SPGA must find that the developer has clearly demonstrated that providing such unit(s) on -site would create significant hardship and that a cash payment in lieu of on -site unit(s) is in the best interest of the Town. Any request for alternative means of compliance shall be reviewed by t the Watertown -Housing Partnership-WHP, which shall then make its recommendation to the SPGA. (2) The SPGA shall authorize that an alternative method of compliance be used, in accordance with the following: (A) Cash Payment: The SPGA may grant a special permit to provide affordable housing through a cash payment to the Watertown Affordable Housing Fund, in lieu of providing one or more of the affordable units required under this Section; provided, however, that a fee in lieu of affordable units may be authorized only for a covered developments with more than five (5) and up to ten (10) units of for rental, for -sale or homeownership units. The cash payment shall be equal to the difference between the fair market value for a typical market -rate housing unit and the price of the affordable housing unit consistent with DHCD LIP Guidelines and shall be in accordance with a schedule of affordable housing payments as outlined in Section 5.07(h)(6) and 1 Text in bold black type in (d)(1) appears this way in the Ordinance now. Proposed Text Amendments to Section 5.07 of Watertown's Zoning Ordinance Draft as of September 8, 2014 as Recommended by Watertown Housing Partnership and Planning Board Page 3 of 6 (f) (g) guidelines adopted and amended from time to time by the SPGA, following a public hearing, in consultation with the Watertown —Housing —Partnership WHP and the Watertown Department of Community Development and Planning. Location and Comparability of Affordable Units (1) Affordable units shall be proportionately distributed throughout the building(s) in a covered development. (2) Affordable units shall be indistinguishable from market -rate units in exterior building materials and finishes; overall construction quality; and energy efficiency, including mechanical equipment and plumbing, insulation, windows, and heating and cooling systems, as determined by the Building Inspector (3) Affordable units may differ from market -rate units in type of appliances, finishes; however, the affordable units shall be comparable to the base market -rate units in such instances. (4) Affordable units shall have the same gross floor area as the average median market - rate units of the same number of bedrooms within a margin of 20%; provided; a--ene bedroom -affordable -unit shall -be not Icss than 800--square-feet, a two -bedroom -not lees than -1 000 -square feet, any ^ thr^ -bedroom-not less than 1350 -square feet that units are not less than the minimum square foot required by DHCD. If the 20% margin -results in a higher gross floor-ar-ea-average than the -minimum -noted -above, the higher -square footage -shall be -required. The bedroom mix in the affordable units shall be proportionate to the market -rate units, unless the SPGA authorizes a different mix by special permit upon the recommendation of the WHP. Dwelling-units-exceeding-2TG00-square feet shall -be -exempt from -the calculations-i-r}determining t c "average" size of dwelling -units -within -the project. (5) The SPGA may adopt regulations or guidelines to further define comparability of the foregoing requirements. (6) The Watertown Housing -Partnership WHP shall provide the Applicant Petitioner and SPGA as provided in 5.07(j) with its recommendations with reference to the Petitioner's proposal in meeting the requirements for affordable housing. Affirmative Marketing and Local Preference Policy Affordable units shall be made available for purchase or rent to eligible low- or moderate -income households under an affirmative marketing plan that complies with federal and state fair housing laws, and fair housing and local preference guidelines established by the Watertown Housing Partnership. No building permit for a covered development shall be issued unless the Department of Community Development and Planning (DCDP) has determined that the Petitioner's affirmative marketing plan complies with this requirement. The affirmative marketing costs for the affordable housing units shall be the responsibility of the Petitioner. (h) Preservation of Affordability (1) Affordable units provided under this Section shall be subject to an Affordable Housing Restriction that contains limitations on use, occupancy, resale and rents, and provides for periodic monitoring to verify compliance with and enforce said restriction. Affordability restrictions shall be contained in applicable affordable housing restrictions, regulatory agreements, deed covenants, contractual agreements, land trust arrangements and/or other mechanisms to ensure compliance with the affordability requirements of this Section 5.07 (collectively, "Affordable Proposed Text Amendments to Section 5.07 of Watertown's Zoning Ordinance Draft as of September 8, 2014 as Recommended by Watertown Housing Partnership and Planning Board Page 4 of 6 Housing Restriction"). (2) The Affordable Housing Restriction shall run with the land and be in force in perpetuity or for the maximum period allowed by law, and be enforceable under the provisions of Chapter 184, Section 26 or Sections 31-32 of the General Laws. (3) The Affordable Housing Restriction shall provide that initial sales and rental of affordable housing units and their subsequent re -sales and re -rentals shall comply with federal, state and local fair housing laws, regulations and policies. (4) The Affordable Housing Restriction shall provide that in the event that any affordable rental unit is converted to a condominium unit, the condominium unit shall be restricted in perpetuity in the manner provided for by Section (h)(1) above to ensure that it remains affordable to households in the same income range as prior to the condominium conversion. (5) For a covered development that provides Inclusion Units: (A) No building permit shall be issued until an Affordable Housing Restriction has been executed by the Petitioner and the SPGA and the Petitioner provides evidence acceptable to the Director of Community -Development and Planning DCDP that the agreement has been recorded at the Middlesex County Registry of Deeds. (B) For a rental, for -sale or homeownership unit, the Department of Community Develepmennt and D1-.�aFmi„g DCDP shall not sign off an authorize or sign off on a Certificate of Occupancy until the applicant Petitioner submits documentation acceptable to the Director of Germanity-Developmentand-Warning DCDP that an affordable housing deed rider has been signed by affordable unit homebuyer and recorded at the Middlesex County Registry of Deeds. (6) For a covered development that provides affordable housing through a cash payment in lieu of affordable units: (A) For a covered development having 10 units or less that provides affordable housing through a cash payment in lieu of affordable units; the following reduced percentage (%) of the difference between fair -market value and affordable housing unit as described in Section e. 2. A. shall apply: 10 units — 100%; 9 units- 90%; 8 units — 80%; 7 units — 70% and 6 units — 60%. (B) The Departmcnt of-Gemmua,,#y-Development--and-Planning (DCD&P) shall not sign off on Certificate(s) of Occupancy for Unit 6 until the appiieant-Petitioner pays 50% of the required fee; or payment in full if it is a 6 -unit covered development. Before a certificate of occupancy can be issued for Units 7-10, the appllsant-Petitioner must pay the remaining 50% or payment in full for covered developments having 7, 8, and 9 units and provide evidence to the Director of DCDP that the cash payment has been paid in full to the Affordable Housing Fund. For projects above 10 units, the remaining fee must be paid prior to the issuance of the Certificates of Occupancy for unit 11 and above. (7) All legal documentation in connection with the affordable housing units shall be in the standard form provided by the Town of Watertown, as approved by legal counsel to the Town. If the Petitioner proposes to use documentation other than that provided by the Town, any and all costs associated with review by legal counsel to the Town shall be paid by the Petitioner. Proposed Text Amendments to Section 5.07 of Watertown's Zoning Ordinance Draft as of September 8, 2014 as Recommended by Watertown Housing Partnership and Planning Board Page 5 of 6 (1) Submission Requirements and Procedures Projects requiring the provision of affordable units under this Section must submit a proposal as to the method of meeting the affordable housing requirements with the application for zoning relief and a copy to the Watertown Houinn P r-ship-WHP. TheWatertown-Housing Partnership WHP shall, in writing, provide the applicant -Petitioner with their recommendations no later than forty (40) days from submission. The SPGA may adopt additional submission requirements and procedures not inconsistent with this Section, following a public hearing and consultation with the Watertown -Housing -Partnership WI-IP. Q) Special Regulations for Inclusion Units (1) Use Regulations: Developments with Inclusion Units shall comply with Section 5.01, Table of Use Regulations; provided, however, that a covered development with not more than ten (10) multi -family units shall be a permitted use when at least -1-O% 12.5% of the units are Inclusion Units as defined hereunder, in which case the development shall qualify for review as a Small -Scale Inclusion Development. (2) Small -Scale Inclusion Development Submission Requirements and Procedures: No building permit for a Small -Scale Inclusion Development shall be issued until the SPGA has approved a site plan in accordance with Section 9,03 and the provisions of this Section. The SPGA may adopt regulations for submission requirements and procedures not inconsistent with this Section, following a public hearing. (3) Cost Offsets and Affordability Requirements: Inclusion Units shall be exempt from the minimum lot area per dwelling unit and/or maximum floor area ratio, as set forth in Section 5.04, provided that the Inclusion Units comply with the following affordability requirements: (A) Rental Units: For the affordable units, the maximum affordable rent shall be affordable to a household with income at or below 65% area median income (AMI), adjusted for household size; provided, however, that the SPGA may grant a special permit for a development in which the affordable unit rents are, on average, affordable for a household with income at 65% AMI. For example, in a development with two Inclusion Units, the maximum rent for each unit may be that which is affordable to a household with income at 65% AMI, or one unit may be affordable to a household with income at 50% AMI and the second unit may be affordable to a household with income at 70% AMI. However, no affordable unit in a rental development shall be priced for affordability to a household with income exceeding 80% AMI. (B) Homeownership Units: For the affordable units, the maximum purchase price shall be affordable to a household with income at 70% AMI, adjusted for household size. (4) Local Initiative Program Requirements. The Petitioner shall be responsible for preparing and complying with any documentation that may be required by DHCD to qualify affordable units for listing on the Chapter 40B Subsidized Housing Inventory. (k) Severability If any portion of this Section is declared to be invalid, the remainder shall continue to be in full force and effect. Proposed Text Amendments to Section 5.07 of Watertown's Zoning Ordinance Draft as of September 8, 2014 as Recommended by Watertown Housing Partnership and Planning Board Page 6 of 6