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MD: Zoning a Path to Affordable Housing

The Baltimore City Council is considering a bill that would require developers to include affordable housing units in all of Baltimore's residential projects. Under the proposal, up to 20 percent of all housing units would be reserved for low to moderate income people. Baltimore is not the first city in Maryland to consider such a proposal. Montgomery County, MD, in an effort to combat the loss of affordable housing, requires between 12.5 and 15 percent of the total units in every new subdivision or high-rise building be sold or rented at specified, affordable prices.

Passed in 1974, Montgomery County is the leading example of mandatory inclusionary zoning. Inclusionary zoning aims to increase the availability of affordable housing by requiring developers to make a percentage of housing units in new residential developments available to low and moderate income households. In return, developers receive non-monetary compensation, such as zoning variances, expedited permits, or density bonuses that can reduce the cost of construction.

Inclusionary zoning ordinances have produced over 11,000 affordable units in the Greater Washington D.C. metropolitan region. Furthermore, households from varied racial, ethnic, and economic backgrounds have benefited from the inclusionary zoning programs. The programs have also successfully promoted economic integration with widespread placement of affordable units.

Several states, including Massachusetts, New Jersey, Minnesota, and California, have adopted legislation supporting inclusionary zoning. As of March 2003, a 30 year survey of inclusionary zoning policies in California found there were 107 cities and counties in California using inclusionary zoning. The study also found that of the inclusionary jurisdictions, 80 percent of them believe that the inclusionary program stimulated the production of affordable housing that would not have been built otherwise.

In New Jersey, a historic fight for affordable housing reached the state's Supreme Court. Southern Burlington County NAACP v. Township of Mount Laurel and subsequent cases fought against the land use regulation in place in the Township of Mount Laurel on the grounds that low and moderate income families were unlawfully excluded from the municipality. The New Jersey Supreme Court ruled that municipalities may not, through a system of land regulation, make it physically and economically impossible to provide low and moderate income housing. In response to the Supreme Court's ruling, the legislature passed the New Jersey Fair Housing Act, which created the Council on Affordable Housing to establish regulations obliging each municipality to provide a specific number of affordable housing units. With the Fair Housing Act, New Jersey took an important and brave step to ensuring that people had access to affordable housing.

Massachusetts uses a combination of tools to promote affordable housing, including a precedent-setting statute that allows developers of affordable housing to sidestep zoning and all other local regulations. Nearly a third of all municipalities in MA have gone even further by adopting zoning provisions explicitly intended to promote affordable housing.

In Montana, cities facing massive growth from wealthy outsiders who squeeze workers out of local housing markets have begun to look to inclusionary zoning, with one local official rebranding it as "workforce zoning" because of the group of people it is intended to protect.

There has been resistance, however, in all of these locales by developers opposing further inclusionary zoning regulations. Not surprisingly, developers claim that inclusionary zoning prevents them from making money on affordable housing. This criticism appears weak under scrutiny, and, in fact, inclusionary zoning may actually help to accelerate development. A study by Business and Professional People for the Public Interest concluded that inclusionary zoning did not slow development and also cites a Bay Area Economic study that states housing projects within inclusionary zoning areas still maintained a 10 percent profit margin for the private developer.

Unsurprisingly, protecting workers who actually run a city and ensuring long-term economic balance within a local area actually strengthens communities.

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