New Orleans is facing an affordable housing crisis. As of 2015, 56% of renters and 30% of homeowners are cost burdened, meaning they are spending more than 30% of their income on housing. Moreover, from 2000 to 2013, home values and rents have gone up by over 50%, while wages have remained stagnant. We can and must meet this crisis head-on using a combination of tools in our toolbox. One of these tools is mandatory inclusionary zoning, a local policy that taps the economic gains from rising real estate values to create affordable housing for lower income residents. The policy seeks to capture a portion of the higher value by requiring that developers include affordable units in their market-rate developments. This is a practice that cities around the country have enacted, and New Orleans is in the process of studying its applicability to our city. The City Planning Commission has produced a study, requested by City Council, which has been completed and will soon be presented to City Council. Senate Bill 162 not only sought to deny New Orleans the ability to continue to explore this policy, but in fact to remove this vital tool as an option for any local government in Louisiana. It would have decrease our ability as a city to make the decisions we must to protect our most vulnerable citizens. We opposed this bill to allow for equitable housing policies. The bill died in House Committee with a 7 to 8 vote thanks to the tireless work of public officials and advocates.
Inclusionary zoning is needed because federal housing programs are shrinking. Historically, affordable housing developers have relied heavily on federal dollars to fund the purchase of land and to pay for construction. With federal funding drying up, local solutions are becoming more important across the country, especially local solutions where the market growth can help pay for more affordable homes.
Inclusionary zoning is one step towards addressing economic segregation. Economic segregation is where peoples with low incomes live in one part of town and people with high incomes live in a different part. The wealthier parts of town receive more investment, and often contain more neighborhood services, and access to higher-paying jobs. Children who grow up in neighborhoods with very high poverty rates have a proven harder time succeeding in their future careers. Inclusionary zoning proposes housing policies that help ensure people with lower incomes still have quality housing choices with access to public transportation and neighborhood services.
Last year, New Orleans underwent a lengthy study process to create an inclusionary zoning policy that is feasible for our city and would create much-needed affordable units. This study, called the Smart Housing Mix Ordinance Study, recommends requiring 12 percent of units in multifamily developments to be rented or sold below market rate in hot-market areas of the city that. The study also recommends offering developers an incentive package to ensure that their projects are profitable.
Senator Appel’s Bill 162 was a direct attack on New Orleans’ policy to respond to our residents’ needs. Ironically, this bill, submitted by a Metairie Republican Senator and overwhelmingly supported by Republicans in Committee and on the Senate floor, violated one of the Republican’s stalwart beliefs that decisions are best made locally. What is more, many of the Senators who voted in favor of the bill in this Legislative Session voted in favor of Senator Gray’s bill allowing for inclusionary zoning in 2006. We need to be utilizing all the tools possible to tackle the affordable housing crisis, not taking them out of the toolbox before they have even been used. Now that this obstacle has been removed, we need to work as a city to implement this valuable tool.