Corte Madera eases affordability rules to spur construction
Corte Madera is adjusting its affordable housing requirements in a move to boost development in town.
The update, which replaces the town’s inclusionary housing ordinance, reduces the number of homes developers have to reserve for low-income residents and reestablishes in-lieu fees. The Town Council unanimously approved the ordinance at its meeting last week.
“The purpose of this ordinance is to ensure that our policy is achieving its desired purpose, which is the creation of affordable units,” Martha Battaglia, senior planner, told the council at its May 17 meeting.
Under the new regulation, developers are required to sell or rent 20% of the housing in new projects at below-market rates, down from 25%. The decrease matches the recommended threshold for Bay Area communities, Battaglia said.
It is designed to strike a balance that encourages new construction, while not unduly impacting overall housing production. Battaglia said the town received feedback from developers that the 25% threshold made construction unattainable for certain projects.
The affordability requirement would now kick in for projects that include two or more residences. The previous ordinance triggered affordability requirements with construction of a single unit.
The ordinance provides some flexibility for rental projects with one option providing more residences in the very-low-income bracket and the other boosting low-income homes.
For example, under option one, a 20-unit rental project would require the developer to set aside two very-low-income units and two moderate-income units. In the second option, a project the same size would require three low-income units and one moderate-income unit.
If the 20% threshold equals a fraction, the developer could pay that fraction in in-lieu fees or round up the number of affordable units.
The new in-lieu fees will be based on the affordability gap, which is the difference between the cost of construction and the rental or purchase price. The fee will increase or decrease annually based on the California Construction Cost Index.
Previously, the in-lieu fee was based on construction costs from 2003, when the ordinance was first adopted, and has become outdated.
In-lieu fees for this year will be $289,905 for a for-sale single-family home, $203,088 for a for-sale condominium or townhome, and $362,817 for a rental property.
“Really, the strategy here is to try to require as many affordable units — as housing is getting built through private development — as we can,” said Adam Wolff, planning director.
Wolff said the town has about $550,000 in its affordable housing fund. That fund is supplemented by in-lieu fees and commercial building fees. The fund is used to support construction of affordable housing.
One project, proposed by Mack Namakian, for three apartments at 645 Tamalpais Drive, will be exempt from the new rule, because the application was completed prior to the new ordinance taking effect.
The ordinance is set for a second reading at the June 7 council meeting. It will be imposed 30 days after adoption.