A different type of affordable housing for Harrisonburg

What if some of the larger apartment buildings that have been approved never get built? Is there a plan B to build more affordable housing in the city?

In 2019 I wrote a piece titled What’s Driving Harrisonburg’s Affordable Housing Crisis And How Our Community Can Work To Change It. I suggested several local, state and federal policies to address the shortage of housing in general, and more specifically, the lack of available affordable housing. Since that time, Harrisonburg City Council has approved rezonings for several medium and high-density residential developments across the city. At least two of those approved developments were designated as affordable. Yet the monthly housing costs in Harrisonburg have only gone up.

The industry definition of “affordable housing” is monthly rent or mortgage payments that are no more than 30% of a household's monthly income, which makes it a moving target as income tends to lag behind rising costs of living. When council members and developers talk about new affordable housing developments, they’re generally referring to projects funded at least in part by public subsidies like low income housing tax credits (LIHTC) or private subsidies like Habitat for Humanity projects.

The vast majority of housing development in the US, however, is what developers call “market rate.” Another way of saying market rate is: the highest price buyers and renters are able to pay, given what other options are available nearby. An objection I often hear in opposition to rezoning requests for large, unsubsidized multifamily developments is that they are “luxury apartments” that will do nothing to help people in need of affordable housing. While we can (and I will) argue about what constitutes “luxury apartments” as opposed to simply “new construction,” it is true that developers generally want to get the best possible return on their investment.

One of the more banal questions asked of developers is if their unsubsidized housing project will be “affordable.” If the land was purchased at market rate and the labor and materials used to build the housing are market rate, and there aren’t any public or private subsidies helping to pay for affordable housing, then the housing will be market rate. That’s why most of the new housing that actually gets built is market rate. I’ll save inclusionary zoning (IZ) for a future post, but regardless of whether you support or oppose IZ, it’s not currently an option for Harrisonburg under Dillon’s Rule in Virginia.

When I’m asked “when are they gonna build that development that was approved last year,” my short answer is “the process takes time.” But very few of the larger projects that have been approved by City Council since I joined Planning Commission eight years ago have broken ground. You wouldn’t know it by reading local headlines about City Council decisions, but rezonings don’t necessarily result in construction. While Council has the power to stop certain housing developments from being built by denying land use change requests, they don’t actually propose or build the housing (Council did allocate $2 million of the City’s ARPA funds for a Housing Development Fund to expand the supply of affordable housing).

A developer’s rendering of the Armada Hoffler market-rate project in what is currently the Regal 14 parking lot in Harrisonburg. The 250-unit apartment was approved by Council in 2022.

The investors financing the developments ultimately have the final say on if an approved housing development actually gets built. That’s one thing both market rate and subsidized housing projects have in common — if the financing falls through for any reason, it may never get built. The 80-unit affordable housing proposal on Lucy Drive was approved by Council in 2022, but didn’t successfully acquire the necessary Section 42 tax credits to make the development feasible. The 250-unit market rate Armada Hoffler apartments in the Regal 14 parking lot were approved by Council in 2022. The site still looks like this:

We can blame the banks, the labor market, a long approval process, supply chain issues, insurance companies, or the Federal Reserve. Whatever the reason, several of the larger projects that have been approved by City Council over the last eight years are not currently being built. To be clear, some of them might still get built, but most of these land use approvals were paired with special use permits that expire if the developer hasn’t “diligently pursued” the process within a set number of years.

Proposed layout of an 80-unit affordable housing development that Woda Cooper successfully had rezoned, but never built.

It’s also possible that a different multifamily project could be built on those rezoned parcels by-right, because the rezonings don’t expire. In the meantime however, people can’t live inside a rezoning or a special use permit. The actual brick-and-mortar housing needs to be constructed.

How might we become less reliant on these larger developments for increasing housing supply in Harrisonburg?

Affordable housing subsidies vs. affordable housing types

A few months ago Strong Towns founder Charles Marohn visited Harrisonburg and spoke about The Housing Trap — the title of his book, and a term for the situation many cities find themselves in today, with a conflict of interest between housing as shelter and housing as a financial product. The Strong Towns solution to the housing crisis is small-scale, incremental development. Incremental infill projects can help provide some of the “missing middle” housing we need without relying on multi-million dollar financing deals or large out-of-town developers. Incremental development can provide an alternative to the boom-and-bust nature of big-time housing development.

An illustration from Densifying in Place: Five Proposals for Inclusive Infill Housing in Charlottesville, showing a narrow house built between two detached single family structures. By Patrick Sardo et.al.

There’s an important distinction between affordable housing subsidies and affordable housing types. Backyard casitas (ADUs), basement apartments, multiplexes, smaller houses on smaller lots, single-room occupancies, manufactured housing — these are all examples of housing with comparatively low land and construction costs per household. The construction of these dwellings doesn’t necessarily have to be subsidized in order for them to be affordable. The problem is that our current zoning ordinance prohibits these missing middle options in the most parts of the city. Many potential infill developments are further made infeasible by the off-street parking requirements in our zoning ordinance.

An affordable housing plan B for Harrisonburg

While I still hold out hope that the larger affordable housing projects will eventually get built, the city is not ultimately in control of those outcomes. However, the city is in control of our own zoning ordinance. We need a plan B for Harrisonburg that removes the barriers to building more affordable infill housing — by-right rules that allow “small-time developers” to build housing on smaller lots without relying on high-stakes financing deals that might fall through.

There are right ways and wrong ways to legalize affordable housing types. The history of the ADU ordinance in Boise, Idaho serves as an example of both. Boise had previously “legalized” accessory dwelling units in their zoning ordinance, but had restrictions on who could live in the units, how big they could be, and each unit required two off-street parking spaces. Very few property owners in Boise pursued building backyard cottages until the city revised the ordinance late last year, removing the owner occupancy requirement, increasing the size a unit can be, and removing the parking mandate.

In the three-and-a-half months since its new zoning code took effect on Dec. 1, 2023, the City of Boise had 27 people per month apply for permits to build accessory dwelling units (ADUs) on their property ... That compares to a permit rate of just over 3 per month in the 12 months before the new code took effect. The rate of permit applications for ADUs under the new code is nearly nine times the rate of approvals in the year before the new code took effect. (Next City)

Putting too many rules and restrictions on building different types of affordable housing is unlikely to result in a meaningful increase in construction. Removing the off-street parking requirements is a crucial element that makes many of these smaller developments pencil out. We can learn from the successes and failures in other cities and towns in the US, and adapt them to suit our needs. This can be done in Harrisonburg as we rewrite the zoning ordinance (a process that is still ongoing). We need more affordable housing in the city. Legalizing incremental infill development of affordable housing types will lower the barriers to building it.