Pittsburgh has 90 neighborhoods, but only four of them require large housing developments to include affordable units for lower-income people.

Mayor Ed Gainey wants to expand that mandate, known as “inclusionary zoning,” to all parts of the city.

Gainey’s administration is pushing for a blanket strategy, arguing that affordable housing is needed citywide.

Not everyone agrees with that approach. On Tuesday, City Council member Bob Charland introduced a competing vision.

He wants to leave it up to residents of each neighborhood to decide whether to force developers to include affordable housing, though his bill doesn’t spell out the process.

Charland said neighborhoods should make their own choices because each is unique.

“We’re empowering neighborhoods to choose their path if they want to be an inclusionary neighborhood or not,” Charland, D-South Side, said.

Inclusionary zoning is meant to boost the supply of affordable housing. Some critics, however, have argued that it can actually disincentivize development.

It’s in effect only in Bloomfield, Lawrenceville, Polish Hill and much of Oakland. City Council and the Planning Commission determine which neighborhoods to include.

The plans promoted by Gainey and Charland look to create housing for people at different income levels, and Charland’s provides more help for developers.

Below, TribLive explores the different facets of both plans

Affordability

Gainey’s bill would require new and renovated housing developments with 20 or more units to designate at least 10% of them as affordable housing for people making no more than half the area median income.

That’s about $35,400 for an individual or $66,800 for a family of eight.

Under Charland’s proposal, developments in areas with inclusionary zoning would have three options: Use the same set-aside for the lowest-income residents; tag 15% of units for households making between 51% and 80% of the area median income; or target 20% for workforce housing for those earning between 81% and 120% of the area median income.

Jake Pawlak, director of the Office of Management and Budget, criticized Charland’s proposal for including housing for people making more than the median income.

The focus, Pawlak said, should be on the poorest residents who are most in need of housing help.

“The so-called ‘Inclusionary Housing’ bill that Councilman Charland introduced in Council today would hinder our efforts to make housing more affordable in the City of Pittsburgh,” Gainey said in a statement, arguing Charland’s proposal favors corporate interests over working families.

Charland, however, said the city needs to bolster its supply of housing at all income levels.

Working-class people, he said, shouldn’t have to move to the suburbs to find housing options they can afford.

Charland also pointed out that the city sometimes struggles to recruit workers because they can’t afford to live in the city, and many city jobs have a residency requirement.

The proposals also differ in how long those housing units would need to remain affordable. Gainey is proposing 99 years. Charland is suggesting 20.

Currently, the city’s inclusionary zoning policy requires units remain affordable for 35 years.

Incentives

Charland’s bill offers robust incentives for developers building affordable housing.

His bill would require that the city, the Urban Redevelopment Authority and the Housing Authority of the City of Pittsburgh cover the funding gaps developers face when they set aside some units as affordable housing, rather than renting them at market rates.

Incentives could take the form of cash payments, tax breaks or waived fees, Charland said.

Pawlak lambasted that portion of Charland’s proposal, calling it a “blank check to developers.”

“We have grave concerns about the effect that it would have on housing affordability, but also on the city’s finances, which is a particularly interesting topic coming from Councilman Charland” who has been outspoken in his concerns about the city’s fiscal health, Pawlak said.

But Charland argued that inclusionary zoning without financial help could deter development and stall new housing.

“The current inclusionary zoning program does not create more affordable housing than it restricts,” Charland said.

Pittsburgh Chief Economic Development Officer Kyle Chintalapalli, who also chairs the redevelopment authority’s board, said the city already provides some financial help for projects being constructed with mandated affordable housing.

An existing citywide incentive for developers meeting inclusionary zoning guidelines — whether they’re in one of the four neighborhoods or not — provides a tax break of up to $250,000 per year for up to a decade on he assessed value added by renovation or new development.

Charland’s proposal includes provisions that would allow developers building in parts of the city where inclusionary zoning is not mandated to abide by its requirements voluntarily in exchange for financial help and other incentives, like additional height allowances.

Gainey’s bill would allow developers to build on smaller lots, put more units in than what is currently allowed, and eliminate minimum requirements for parking spaces.

Effect on renters

Charland’s proposal would tweak a provision in the existing zoning code that can displace residents who get pay raises or better-paying jobs.

“Our current inclusionary zoning bill has a cruel practice where if you start making more money than the inclusionary zoning guidelines, then you are kicked out of the building,” Charland said.

His proposal would permit those people to stay in their homes, even if their income increases. Those units would still count toward the required amount of affordable units on the site.

Inclusionary zoning in Lawrenceville

Housing advocacy group Pro-Housing Pittsburgh on Tuesday released a report studying the impacts of inclusionary zoning in Lawrenceville, the first neighborhood in the city where it was implemented.

David Vatz, who leads the group and co-authored the study, said the organization wanted to better understand whether Pittsburgh’s inclusionary zoning policy actually created more affordable housing.

Their verdict wasn’t favorable.

According to the study, construction rates of buildings with 20 or more housing units in Lawrenceville dropped by roughly 32% per year after inclusionary zoning was implemented in 2019, compared to prior years dating back to 2012.

The study compared that to two other city neighborhoods with similar base zoning, topography and business districts — but no inclusionary zoning requirements. The Strip District and South Side Flats saw construction rates increase by 36% and 18% respectively, during the same time frame that Lawrenceville saw construction wane.

“To us, that’s a pretty big indictment of IZ (inclusionary zoning) policy,” Vatz said.

But Pawlak argued that there had been a major development boom in Lawrenceville just before inclusionary zoning was implemented, and it was natural for that to cool.

Vatz criticized Gainey’s proposal to roll out the controversial policy citywide, arguing it could stall more development and make housing less accessible and more expensive.

But he voiced support for Charland’s bill, arguing its provision to fill funding gaps created by the affordability requirements would ensure it didn’t deter developers.

Vatz also backed Charland’s notion of tackling affordable housing through mandates on a neighborhood-by-neighborhood basis because different parts of the city have different zoning and see different amounts and types of development.

Potential compromise

The two bills in many respects are wholly incompatible.

But Pawlak said there’s at least one area where compromise is possible.

Charland has proposed to exempt from inclusionary zoning requirements any development built within an existing tax incentive district.

Pawlak said the mayor’s office is considering exempting developments Downtown, where such a tax district is in place.

Chintalapalli said the administration also could consider more generous tax breaks for projects that include affordable housing.

What now?

Gainey’s legislation is set to come before the Planning Commission next week. After the commission votes, it will move to council for a final vote.

Gainey’s measure is part of a broader zoning package that also proposes to legalize accessory dwelling units and permit multi-family developments around certain transit hubs.

Council next week will likely vote to send Charland’s bill to the Planning Commission after which it will head to council.

Charland and Pawlak said it is unclear whether council could consider both measures at the same time.

It is unclear what would happen to neighborhoods that already have inclusionary zoning under Charland’s bill. It‘s also unclear how the proposals would impact developments already working through the approvals process.

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