Title
Resolution to Annually Update Formula Calculation for a Per-Unit Contribution Amount for Affordable Housing Contributions for Planned Unit Development Districts
Memorandum
REVISED - MEMORANDUM
Attached for City Council review and approval is a resolution updating the formula calculation for the affordable housing contribution provisions of the Planned Unit Development Ordinance. This resolution implements Section 5:80(6)(e)(ii) of the PUD ordinance.
The formula for the PUD affordable housing contribution is set by Council resolution on an annual basis at the beginning of each fiscal year. The Council resolution establishes a per-unit contribution that offsets the difference between the cost to purchase a moderately priced housing unit in the current Ann Arbor market and the sales price that is affordable to a lower income household.
In developing the affordable housing contribution formula, Community Development staff targeted a moderately priced home for the area at the 43rd percentile of all residential property sales (excluding vacant land and commercial property) from a three- month period. The 43rd percentile for the period of February, 2007 to April, 2007 was
$212,500. The affordable sales price to a lower income household of four at 80% of the Area Median Income (AMI) is currently $119,200. The difference between the two figures represents a $93,300 gap in affordability, which will be used as the amount of contribution required per unit from the developer, in lieu of providing the units on-site. For PUDs of up to 9 dwelling units, a pro-rated formula contribution is proposed.
The $93,300 is an increase of $4,300 from the current cash-in-lieu contribution amount of $89,000.
PUD affordable housing contributions will be deposited in the Ann Arbor Housing Trust Fund, where they would be available to non-profit and for-profit developers to subsidize the cost of new or rehabilitated residential units to make them affordable to lower income households....
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