In the Zone with Clementa Amazan – Episode 3

Written by: Clementa Amazan

'In the Zone with Clementa Amazan' is a video series that discusses the bonuses provided by the city that allow for additional height, floor area, and density, a terrific option for developers trying to avoid the variance process. In episode 3, we will be covering changes for the Mixed-Income Housing Bonus.

On May 20, 2021, District Council Members Maria Quinones-Sanchez and Jamie Gauthier introduced bill number 210474, which was amended on June 24, 2021. As we discussed prior, sections 14-702-2 through 14-702-4 of the Philadelphia Zoning Code established a Mixed-Income Housing Bonus that provides bonuses for gross floor area, building height, and housing unit density if the property owner designates a certain portion of dwelling units as affordable under the Philadelphia zoning code.

Under the law, property owners can instead make a payment to the city of Philadelphia’s Housing Trust Fund to receive the Mixed-Income Housing Bonus rather than including affordable units. To do so, the property owner must sign an agreement with the city’s Department of Planning and Development, also known as CPD, and make the payment before the building permit may be issued. Payments are generally calculated based upon the zoning district, the category of the bonus, and the level of affordable housing that is being offered.

The payment in lieu option will now only be available for real estate development projects with at least 10 residential dwelling units. Previously, real estate development projects with at least 4 rei units were eligible to take advantage of the payment in lieu option. 

In addition, the calculations have drastically increased. For example, if a developer has a 5,000 square foot CMX-2 property, which is permitted 10 dwelling units as of right, under the moderate-income, two additional units would be permitted and the estimated payment in lieu would be $163,000, about. Under low income, 5 additional units would be permitted and the estimated payment in lieu would be $265,500. However, under the current law, the estimated payment in lieu for the moderate-income level would be $100,000 and the estimated payment for the low-income level would be $150,000. As you can see, there have been drastic changes in both the properties that are eligible, as well as the payment that must be made for said properties. 

So, also there have been changes for the Mixed-Income Neighborhood Overlay District, which we will be discussing in our next episode.

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