County adopts housing regulation

By Sam Harvey
Staff Reporter

Sussex County Council adopted the ordinance, opening the program to requests for proposal (RFPs), at the Jan. 17 council meeting.

It is perhaps difficult to argue against moderately-priced housing, but Council Member George Cole did cast a dissenting vote, making it 4-1.

“I’m going to be politically incorrect today,” he said. “I think I stated, early on, that if the only solution to the housing problem is to give developers more density – they’ll play along with your game.”

He suggested the program wouldn’t help the people most impacted by the rising cost of housing, and the income brackets that would benefit didn’t really need the help. In any event, Cole remained skeptical that any developers would sign up. (Participation is on a voluntary basis.)

As evidenced by the vote, he received no second for that opinion — his colleagues praised the Moderately-Priced Housing Committee members for their work. Council Member Vance Phillips said he considered their ability to reach consensus a real accomplishment, due to the committee’s diverse makeup (development community on the one side, housing initiative people on the other).

Council Member Finley Jones said he believed developers would step forward to participate, and he refuted Cole’s assertion that the program wouldn’t help working-class families.

The MPHU program grants developers bonus densities for building a portion of residential projects within the reasonable grasp of households whose breadwinners earn median income, more or less.

The numbers come down from the U.S. Department of Housing and Urban Development (HUD), and they change all the time. At the moment, median household income in Sussex County is pegged at:

• One-person household, $38,600]

• Two-person, $44,100

• Three-person, $49,600

• Four-person, $55,100, and so on in stepwise fashion.

Mortgage payments on MPHUs are supposed to be feasible for families earning as little as 80 percent of median income, up to 125 percent of median. Whatever income brackets developers want to accommodate, they have to earmark at least 15 percent of the total residential units they’re building specifically for those brackets.

If they’re willing to build for prospective homebuyers earning less than 80 percent of median (Tier C), they receive a 30-percent density bonus.

For the middle bracket, 80 to 100 percent of median household income (Tier B), they earn a 25-percent density bonus, and for Tier A (median to 125 percent of median) they receive a 20-percent density bonus.

Other incentives include expedited project review and fee waivers. From the ordinance, “council is authorized to modify the provisions of the County’s Zoning Ordinance and the County’s planning and zoning regulations and processes as needed to achieve the Density Incentives and the specific design elements … of approved MPHU projects.”

However, these projects can only be built in town centers, developing areas or the Environmentally Sensitive Developing Area, and where served by public water and sewer.

There are numerous eligibility requirements quite apart from the income guidelines, and stringent restrictions on participants’ ability to realize windfall appreciation (although Community Development and Housing Director Bill Lecates said people could build a little equity in the units).

As it stands, this setup would remain in place for a 20-year “control period.”

Responding to committee member Bob Minatoli’s comment that the economics of developing MPHUs only in development districts (and not in the lower-density parts of the county) would be “formidable,” Phillips recommended opening up the outlying areas.

As Minatoli had pointed out, council would still have the means to approve or disapprove individual project, through the RFP process. However, that motion died for a lack of a second and council’s 4-1 vote was to approve the ordinance as written.