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HomeMy WebLinkAboutEconomic Development Staff Report - 7th & Aspen Page | 1 To: Director of Community Development Fr: Brit Fontenot, Director of Economic Development Date: September 25, 2024 RE: Approval of Affordable Housing Plan for Project #24191 7th and Aspen Master Site Plan and Project #24192 7th and Aspen Site Plan Pursuant to Sec. 38.200.010.H, BMC, as the duly appointed Director of Economic Development, I am the review authority for an affordable housing plan submitted pursuant to 38.380.040. I hereby approve the attached Affordable Housing Plan for the 7th and Aspen Master Site Plan and Site Plan (the “Project”). If you determine the application is appropriate for approval, I request you include in your approval of 7th and Aspen Master Site Plan and Site Plan the following conditions: 1. BMC 38.380.040.E. The applicant and owner, if different, must consent to the City recording a summary of the affordable housing plan immediately following conditional approval of the 7th and Aspen Master Site Plan and Site Plan. 2. BMC 38.380.060.D. The applicant and owner, if different, must record and provide to the City of Bozeman a Notice of Restrictions for the Affordable Housing Plan and a Declaration of Restrictive Covenants that implements the affordable housing plan immediately following conditional approval of the 7th and Aspen Master Site Plan and Site Plan. The summary of the Affordable Housing plan and the restrictive covenant must be recorded prior to issuance of a building permit for the 7th and Aspen Master Site Plan and Site Plan. The proposal is utilizing the Deep Incentives allowed pursuant to BMC 38.380.030.B, which were created to incentivize the increased production of affordable housing to meet the goals of the adopted Bozeman Community Plan and the Community Housing Action Plan. Deep Incentives are available to projects for which the minimum percentage of homes meeting the criteria for affordability is 50 percent. Pursuant to 38.380.030, “Applications for development of affordable homes that comply with the requirements of this division qualify for and must be awarded the incentives applicable to the type and tenancy of affordable housing being provided and requested by the developer. Staff reviewed the Affordable Housing Plan for the 7th and Aspen Master Site Plan and Site Plan for compliance with every requirement of the Affordable Housing division of the code and found that it complies with all code requirements. Therefore, the requested incentives must be awarded. A compliant Affordable Housing Plan must include the following information. a. The total number of affordable homes, and market rate homes in the proposed development. • The 7th and Aspen Affordable Housing Plan includes 17 affordable units restricted at 50% AMI, 29 units at 60% AMI in Phase 1, and 50 units restricted at 80% AMI Page | 2 in Phase 2. Phases 1 and 2 of the project will provide 96 total units, while Phase 3 of the project will provide approximately 75 units, which means that at least 50 percent of the units in all 3 phases meet the affordability criteria for the use of the Deep Incentives pursuant to Table 38.380.020-1. b. The table in 38.380.020-1 to be applied to the affordable housing plan. • The 7th and Aspen Affordable Housing Plan references Table 38.380.020-1 – Affordable Homes Required for Deep Incentives. To be eligible for Deep Incentives, the requirements of Table 38.380.020-1, including providing at least 50 percent of the homes within the multi-household dwelling for sale or rent at percentages of AMI. This project meets the requirements because the development proposes at least 50 percent of the dwellings be priced at 80 percent of AMI or less, in accordance with requirements found in the table. c. The number of bedrooms in each proposed low-income affordable home, and market rate home in the development. • The 7th and Aspen Affordable Housing Plan stipulates that Phases 1 and 2 of the project will have 96 units, 100 percent of those units are proposed as affordable units. The proposed project meets the code requirement. With the inclusion of 75 market rate units in Phase 3, the overall project will need to meet requirements related to 38.380.040.2.b requiring that the “mix of bedrooms per unit in affordable homes must be as similar as possible to the mix of bedrooms per unit of the market- rate homes in the development.” d. Whether each affordable home will be offered for rental or for sale. • The 7th and Aspen Affordable Housing Plan provides that all affordable units will be offered for rent. e. The location of affordable lots or units in the development. • The 7th and Aspen Affordable Housing Plan provides an exhibit (7th & Aspen Mixed-Use Affordable Housing Action Plan) showing the locations of the 96 affordable units. f. The applicable AMI and maximum rental or sales price applicable to each low-income affordable home. • Because each of the affordable units will be offered for rent, the maximum rental price allowed is 80 percent of Area Median Income (AMI). The Department of Housing and Urban Development (HUD) is required by law to set income limits that determine eligibility for assisted housing programs. These income limits are set at certain percentages of an area’s median family income (MFI). MFIs are also often referred to as area median incomes (AMI). Page | 3 o The 7th and Aspen Affordable Housing Plan provides that 17 of the units will be offered at 50 percent of AMI. Given the current AMI, a one bedroom unit will be offered for rent for $986, a two bedroom will rent for $1,183 and a three bedroom will be offered at $1,368 per month. o The 7th and Aspen Affordable Housing Plan stipulates that 29 of the units will be offered at 60 percent AMI. A studio unit will be offered for rent for $1,105, a one bedroom will rent for $1,184, a two bedroom will rent for $1,420, and a three bedroom will be offered at $1,641 per month. o The 7th and Aspen Affordable Housing Plan stipulates that 50 of the units will be offered at 80 percent AMI. A one bedroom will be offered for rent for $1,684, a two bedroom will rent for $1,893 and a three bedroom will be offered at $2,103 per month. g. A description of the requested incentives from section 38.380.040. • The 7th and Aspen Affordable Housing Plan includes a description of the requested incentives from section 38.380.040. These incentives include an additional stories of height, block frontage standards, façade standards, and roofline modulation. h. Any other information that is reasonably necessary to evaluate the compliance of the affordable housing plan with the requirements of this division, as determined by the review authority. • The information provided with The 7th and Aspen Affordable Housing Plan satisfies the requirements of 38.380.040.A.1 and is adequate to evaluate the compliance of the affordable housing plan with the requirements of this division as explained by this staff report. i. If the development is to be constructed in phases. • All of the units meeting the affordability criteria are being provided in the first two phases of the development with market rate units only being offered in the third and final phase of the development. Pursuant to 38.380.040.A.i.(2), the Applicant must update the Affordable Housing Plan to reflect the market rate units in Phase 3. “As the number of low income affordable homes for each later phase is finalized, the developer must submit an update to the affordable housing plan including or updating the information required in this section. The review authority shall review and approve, approve with conditions, or deny the update using the criteria in this section.” BMC 38.380.040.A.2. requires that the Applicant meet the following development standards for affordable homes. a. The number of affordable homes must meet or exceed the minimum standards needed to qualify for the applicable incentive in section 38.380.030. • This application proposes to utilize Deep Incentives. Minimum standards for Deep Incentives are found in Table 38.380.020-1 and require that a project supply at least Page | 4 50 percent of the total homes as affordable homes at a price no greater than 80 percent of AMI for a duration of at least 30 years. The 7th and Aspen Affordable Housing Plan shows 96 units, or more than 50 percent of the project’s units, will be priced at or below a rent that is affordable for households making at or below 80 percent of the area median income. The duration of the affordability of the units will be satisfied by recording a deed restriction requiring the affordable units to remain affordable at rent of no greater than 80 percent AMI for a period of 30 years. b. The mix of bedrooms per unit in affordable homes must be as similar as possible to the mix of bedrooms per unit of the market-rate homes in the development. • The 7th and Aspen Affordable Housing Plan stipulates that the project will have 96 with 100 percent of those units proposed in Phase 1 and Phase 2 as affordable units. BMC 38.380.040.A.2.b. The proposal meets the requirement that the mix of bedrooms in the affordable homes is as similar as possible to the mix of bedrooms in the market-rate homes. Pursuant to 38.380.040.A.i.(2), the Applicant must update the Affordable Housing Plan to reflect the market rate units in Phase 3. “As the number of low income affordable homes for each later phase is finalized, the developer must submit an update to the affordable housing plan including or updating the information required in this section. The review authority shall review and approve, approve with conditions, or deny the update using the criteria in this section.” c. Access to shared amenities and services by residents of the affordable homes must be the same as to those in market rate homes in the development. • The proposal meets the requirement that all units have access to shared amenities. The Applicant must confirm continued compliance with this criterion with their updated Affordable Housing Plan for Phase 3. d. If the development is to be constructed in phases, and the developer has requested affordable housing incentives, at least 75 percent of the dwelling units in each phase must be affordable homes, unless the city has received adequate legal or financial assurance that any shortfall during earlier phases will be constructed before approval of the final phase of development. • 100 percent of the affordable housing units will be constructed in Phase 1 and Phase 2 of the project. The review authority has approved the Affordable Housing Plan for the 7th and Aspen Master Site Plan and Site Plan and finds that the plan includes all information required for the City to confirm compliance with the standards and criteria in BMC 38.380, including the standards in 38.380.030.B – Incentives Available. The Applicant requests the following incentives from BMC 38.380.030.B – Incentives Available: • One additional story of height (38.380.020 – 1.3.c) • Exemption from the following (38.38.020 – 1.3.f) ▪ Special residential block frontage standards along internal pathways (38.510.030.J) ▪ Maximum façade width standards (38.530.040.E) Page | 5 ▪ Roofline modulation (380.530.040.F) The Affordable Housing Plan has been incorporated by reference in the Site Plan documents.