Affordable Housing Bonus Program Expanded in Philadelphia

The city of Philadelphia launched a height and density bonus in 2018 to create incentives for the development of affordable housing, but so far the results have proven underwhelming.

2 minute read

October 5, 2021, 6:00 AM PDT

By James Brasuell @CasualBrasuell

Philadelphia Construction

Fernando Garcia Esteban / Shutterstock

"Philadelphia City Council on Thursday overwhelmingly passed a bill that backers hope will encourage developers to build more affordable housing units in desirable areas," reports Aaron Moselle.

The bill tweaks the city's voluntary Mixed-Income Housing Bonus program, launched in 2018, which has so far underperformed expectations. The program "allows developers to construct larger buildings than allowed under zoning regulations if they agree to build affordable housing units or contribute to the city’s Housing Trust Fund," according to Moselle. "The fund provides money for new affordable homes, as well as the preservation and repair of existing homes."

"Since launching, the program has resulted in developers building fewer than two dozen affordable housing units, with the majority of developers who got the so-called bonuses to build extra floors or floor space opting to contribute to the trust fund instead of building on site," adds Moselle.

The bill's modification to the program will allow developers allow developers of smaller projects (i.e., less than ten units) to be granted mixed-use bonuses of height and density if they build affordable housing on site.

"The measure also includes a provision designed to encourage the preservation of active commercial corridors. That provision bars developers from getting a mixed-use bonus if they are also getting a zoning variance for residential use in a ground-floor commercial space."

More details on the new ordinance and the existing program are included in the source article. A soundbite by Mo Rushdy, the treasurer of the Building Industry Association, expressing skepticism that the bill will achieve the expected benefit for affordable housing in the city, is also included.

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