To increase the supply of affordable housing, Boston Mayor Michelle Wu announced Thursday that she is moving to change the administrative structures that govern citywide development.
The proposals come as Wu enters her second year in office and seeks to make good on a campaign promise to revamp zoning and development.
In a closed-door press briefing, the mayor characterized the measures as one slice of a broader strategy to address Boston’s “most pressing challenge”: Affordability.
“We want to ensure that we are boosting affordability through every possible tool and achieving a balance that empowers us to continue growing as a city,” Wu said.
The Inclusionary Development and Linkage Policies are two tools the city uses to pressure developers into contributing space or money for affordable housing relative to higher-cost dwellings. Both schemes have created thousands of income-restricted units that are intended to be more affordable.
The Inclusionary Development Policy — which currently requires a portion of units or a fee from market rate housing projects of 10 units or more — would change to apply to projects of 7 units or more and demand a fifth of said projects’ square footage rather than their units.
Calculating the demand in terms of square footage would, administration officials said, provide developers increased flexibility to build more family-sized units and allow the city to integrate an additional set aside for low-income renters who hold housing vouchers.
Wu’s recommendations would also limit developers’ option to pay cash to the city instead of building actual affordable units.
Meanwhile, the Linkage Policy — which charges large-scale commercial developers fees to create housing and job training programs — would lower its trigger threshold from 100,000 square feet to 50,000 square feet. Lab developments, which have bloomed across the city in recent years, would also see higher fees than other commercial developments.
Both policies would become embedded in the city’s zoning code.
The proposed changes would also expand the scope of the IDP and make it applicable to future developments that are built “as of right,” or without zoning relief. Projects in the pipeline before the policy changes take effect would still be exempt, officials said Thursday.
The announcement came one week after the Boston City Council passed a resolution signaling a desire for deeper affordability and a lower trigger threshold for inclusionary development. The council will need to approve Wu’s recommendation to that policy, meaning she could be headed for a tussle over its details.
Developers have emphasized the need for predictability amid a quickly shifting economic climate.
Wu administration officials said they would address that concern with clear and consistent development and payment timeline requirements.
Asked about the threat of slowed housing production, Wu pointed to the researchers she tapped earlier in the year to examine both Linkage and IDP.
“The goal of doing it this way with a multi-month feasibility study, is to really analyze all of the comps and ensure that we are considering this current moment’s economic situation,” she said. “We’ve done a year of homework through economic analyses, market research, conversation with those from every angle on the ground. This is a very doable ask of those who are building in the city.”
Responding to the mayor’s recommendations Thursday, Greg Vasil, head of the Greater Boston Real Estate Board, agreed that the city’s housing challenges require new approaches.
“While we are traditionally skeptical of government regulations placed on the real estate industry, we hope that policies like IDP reform may prove successful if they allow the real estate industry creativity and flexibility in their approach to zoning,” Vasil said. “Ensuring that the real estate industry may creatively and flexibly approach zoning is critical to driving increased production in the Greater Boston area — one of the most important steps needed to help us address the housing crisis.”
Wu said the increased demands would be offset by still-forming practices. Some of those include: a potential tax abatement for certain projects, a scorecard that ranks developments according to how they address the city’s challenges, such as climate resilience, affordability and “equity criteria”; and exclusive access to a potential new permitting ombudsman who would shepherd certain projects through the multistep approval process.
Pam Kocher, head of the city’s good governance watchdog, the Boston Municipal Research Bureau, released a statement emphasizing the need to observe how the proposed changes will impact the market.
“Attention to feasibility will be critical as the City seeks to ensure Boston’s ability to retain its position as an appealing market for doing business and pursues its goals to achieve an affordable, equitable and resilient community,” she said.
Wu administration officials said the policy changes would move forward through public comment and agency votes over the next six months. Engagement meetings for the public to weigh in on both sets of proposals will begin next month.
