As you have probably heard, New Castle County (NCC) Council recently approved Substitute #2 to Ordinance 14—109 to enact their new Traditional Neighborhood Housing program. This replaces the previous workforce housing program.
The new ordinance mandates that most new residential rezonings (greater than 25 homes) must contain at least 10-20% moderately priced dwelling units (MPDUs). It also allows a density bonus for subdivision plans that voluntarily contain MPDUs.
We applaud the sponsor Councilman Hollins for his efforts and focus to create more housing for low and moderate housing. During this process, HBADE testified at the Planning Board hearing, worked with Councilman Hollins and NCC officials in meetings and correspondence, and testified at the County Council meeting prior to the vote.
In the end, HBADE remained neutral toward the ordinance. We believed that although the ordinance that passed was an improvement over the originally drafted bill, we asked Council to consider several other provisions, most notably that the mandatory provision in rezonings be made voluntary. The ordinance received a great deal of debate among Council members and ultimately passed as written in Substitute #2 by a vote of 9 in favor and 4 opposed.
For existing communities or subdivision plans approved under the original workforce housing laws, they are not impacted by this ordinance and operate under the original stipulations, conditions and sun-setting provisions.
Thanks to our members Kevin Whittaker, Dev Sitaram, and Kevin Kelly for their help during our interactions with the County to help improve the ordinance. One major improvement we encouraged was that the affordability period for a home to remain an MPDU was lowered from 15 years to 10 years.
The major provisions of the new bill are these:
- In new residential rezonings, it is mandatory that 10-20% of the total number of homes must be MPDU’s.
- The MPDUs must remain afford-ably priced (sales and resales) for moderate income buyers for a period of 10 years.
- Developers that voluntarily include MPDUs in subdivision plans can achieve up to 20% density bonus in exchange for half of the density bonus increase dedicated to MPDUs.
- A contribution shall be made for all dwelling units that are not designated as MPDUs on all Traditional Neighborhood Housing Program plans. The contribution is $12 per $1000 building permit construction valuation which is deposited into the County Housing Trust Fund. The original ordinance was written such that all subdivision plans appeared to be subject to this additional cost but the substitute #2 approved ordinance made clear this is not the case.
- MPDUs must remain afford-ably priced for 10 years.
- If builders are unable to sell their new homes to an MPDU qualified buyer for a period of one year, they may rent the home.
- In the case of resales to subsequent buyers of MPDUs, if the seller during the 10 year period is not able to resell the home to an MPDU qualified buyer with the home on the market for 180 days, they may then sell it at a market rate.
- There are other provisions governing payments-in-lieu of MPDU’s, providing MPDUs offsite, and provisions to address buyer income eligibility and pricing and qualifications.
This is a very broad overview. Anyone with questions should contact NCC Land Use department or NCC Council website for a copy of the approved ordinance for complete details.