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Webinar Q & A: Strategic Investment to Shape and Incentivize Development

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Q&A: Does Your Vision Pencil Out? Part One

By: Community Builders Admin

Date: Dec, 22 2017

Originally airing December 20th, 2017, in the first half of our series Does Your Vision Pencil Out? Alex Joyce took a critical look at the influence of land use policies on development costs, and how they shape project type and design.

Check out a recording of the webinar here.

There were a few questions we were not able to address during the live session. Those questions are presented below, and responses are edited for length and clarity.

Do you have a good example of a community that has written ADUs into zoning? What are some best practices for mitigating impacts?

Seattle and Portland both have good ADU ordinances, with recent updates. Seattle allows two ADUs – one within the primary structure and one as a separate unit (e.g., above a garage or a detached backyard cottage). In Colorado, the city of Durango has a good (and recently updated) ADU ordinance. The town of Crested Butte, CO updated their code to allow ADUs in the 1990s and today offers density breaks and fee waivers in exchange for keeping units as long-term, affordable rentals. The website accessorydwellings.org has an excellent model code resource. Waiving impact fees and parking requirements are often necessary to jump-start a successful ADU program. Another strategy is working with local banks and lenders to understand ADUs and prepare loan packages that support their financing. This can help individual homeowners to afford them.

The most important “impacts” to consider are how neighbors will experience the change from the street – if the change is minimal, then the impacts will be perceived as minimal. With this in mind, it's important to survey existing ADUs in your community and how they relate to existing houses and the street.

I was a bit concerned about the reference to relaxing requirements for "sprinkling" existing buildings. Isn't conformance with a national fire code required?  What are the liability concerns that a municipality would be taking on by relaxing a fire safety requirement?

Good question, and striking the right balance is important here. There are ways that fire suppression can be incorporated into building retrofits that may not require extensive sprinkling, such as enhanced fire rating between units and ensuring sufficient egress. Sprinkling systems can be incredibly cost prohibitive in a retrofit situation, so focusing on the outcome, which is fire safety, and examining multiple construction options that achieve that outcome but are more cost-effective is a worthwhile exercise.

Can you share some other examples of cities that are getting it right from the Midwest and other regions?

I've worked on initiatives in Chicago and Kansas City and have read about initiatives in Des Moines, Nashville, Atlanta, and Vancouver BC that sound promising. I realize those examples are not all from the Midwest, but they are all very different politically and culturally. There are many good lessons to learn from communities throughout the country. A firm that I've worked with, Opticos Design, is doing great work helping communities retool zoning to allow for a broader range of development types. My role has been to market-test zoning standards to ensure they are financially feasible.

As one attendee pointed out, the best way to show people in your community a great local example is to look to your traditional neighborhoods and historic districts. Community Builders and other organizations use walking tours to show how missing middle housing types and other traditional development types are already present in most neighborhoods. A visual example can be powerful.

Are you aware of Property Tax Incentives used in Idaho for infill development? I’m curious if there are any barriers in Idaho state code. We have an urban renewal agency (URA) collecting TIF revenue – could that be used to reimburse taxes on a project?

Each state and even local governments have their own rules and regulations around tax abatements and the specific powers of URAs. Obviously, a tax abatement is most impactful if it includes all the major taxing agencies–city, county, and school.  Authorizing this may require an intergovernmental agreement. In many states, URAs can reimburse projects for tax payments – which has the same impact on project finance as an abatement or exemption. 

Do you know if receiving an impact fee waiver for a project would trigger prevailing wage requirements for construction?

Prevailing wage laws vary from state to state, but in Oregon, Impact Fees (called System Development Charges in Oregon) are exempt. Understanding what types of incentives and subsidies trigger different conditions is important. Seasoned staff at redevelopment agencies can help advise you on what landmines to avoid.

Resources mentioned in the webinar:
Portland Residential Infill Project: https://www.portlandoregon.gov/bps/67728
Envision Tomorrow – A scenario and feasibility planning resource: envisiontomorrow.org

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By: Community Builders Admin

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