Crisis Or Caution? Worcester Affordable Housing Law Sent To Council For Approval

WORCESTER, MA — A key Worcester City Council subcommittee has recommended the city adopt an inclusionary zoning policy that's in line with what an affordable housing coalition has asked for — but the final version of the policy still faces another vote later this month that may change key provisions.

On Wednesday, the council's Economic Development Subcommittee met for a final debate on the inclusionary zoning (IZ) ordinance, which would mandate that each new development in Worcester include affordable units.

The city's Executive Office of Economic Development proposed an IZ policy that's more conservative than what affordable housing advocates — aligned under the Worcester Together Affordable Housing Coalition — had wanted.

Peter Dunn, Worcester's chief development officer, said the goal was to make the IZ policy flexible at first to keep property developers interested in building here.

"Rather than coming out and doing something that is so restrictive and walking that backwards," he told councilors on Wednesday.

But members of the Worcester Together Affordable Housing Coalition say the city is in an affordability crisis and needs a policy that reflects the urgency.

The city's suggested IZ policy offers developers two main options: set aside 15% of units of a given project as affordable for people earning 80% of the area median income (AMI), or set aside 10% of units that are affordable for people earning 60% of AMI. A third option would be to pay a fee — proposed as 3% of the cost of a project's building permit — to avoid building any affordable units.

The Worcester Together coalition's proposal would require developers to set aside 5% of units at 60% AMI and 5% at 80% AMI. That policy might generate overall fewer units, but it would guarantee that each development would include units affordable for people earning lower incomes at 60% AMI.

The city's policy, which groups like the Worcester Regional Chamber of Commerce and Worcester Business Development Corp. back, does offer incentives to developers to select the 60% AMI option. But Steve Teasdale, a member of the coalition and the director of the Main South Community Development Corp., said he fears developers would avoid the 60% option because that would mean opening up buildings to lower-income people — an element of "classism" not considered in the city's proposal.

"The city has to make a recommendation that is prudent from the administration's point of view," Teasdale said Wednesday. "The coalition is making a recommendation that is prudent for meeting the needs of rental households struggling to live in this city."

The coalition also highlighted that, of the thousands of rental units proposed or under construction in Worcester, just 6% are planned to be affordable. The majority of units planned in Worcester will be "market rate" — in other words, set as high as the market can bear. Studio apartments at the new 145 Front St. building downtown, for example, are renting for more than $1,800 per month as of this week, and two bedroom units are approaching $3,000 per month.

The council's Economic Development Subcommittee includes District 1 Councilor and chair Sean Rose, District 4 Councilor Sarai Rivera and At-Large Councilor Khrystian King. Rose has said he supports the city's proposal, but King and Rivera have sided with the housing coalition.

King said he feels the city may have already reached its recent development peak. The new IZ policy may only catch the tail end of a development boom that might get undercut by other market factors, like trouble in the banking industry and high interest rates.

At Wednesday's meeting, King moved to amend the city's policy to include the coalition's 50-50 split proposal between 60 and 80% AMI, among other provisions they had asked for. That amendment passed in a 2-1 vote with Rose voting no.

That amendment will be passed on to the full city council for a vote at the March 28 meeting. Other councilors, including Mayor Joseph Petty, have signaled they favor Dunn's proposal, which may mean the IZ policy could revert during a final vote. The policy will require an eight-vote majority to pass.

"I hope this doesn't create sides or draw lines in the sand," Rose said. "We want to create a policy that doesn't have unintended consequences."