“Some of Pittsburgh’s top developers and building owners have a message for City Council: Ditch the rush to expand affordable housing mandates citywide [through “inclusionary zoning”] for a more comprehensive approach” the Post-Gazette reports.
And as reporter Mark Belko tells it, during a private meeting recently, “they urged council members to avoid a one-size-fits-all approach and to give neighborhoods the ability to craft their own solutions.”
Gee, imagine that.
And allow us to translate: The concept of “inclusionary zoning” in pursuit of “affordable housing” does not work.
The entreaty “came as the city Planning Commission prepares to take up competing [City Council] bills related to affordable housing at a public hearing later this month,” Belko notes. “One proposed by Mayor Ed Gainey would expand citywide affordable housing mandates known as inclusionary zoning,” now limited to a handful of neighborhoods and performing poorly, as predicted.
But the nub of “inclusionary zoning’s” rub remains this (per strongtowns.org):
“It reduces the overall number of units built by making development less profitable,” which results in the cost of below-market units being “passed onto the market-rate units in order to compensate for reduced profits.”
Additionally, “inclusionary zoning” and “affordable housing” can create an “incentive to block projects because activists want ever greater percentages of ‘affordable’ units.”
In a 2019 study, Emily Hamilton, of the Mercatus Center at George Mason University, concluded that “inclusionary zoning has the perverse effect of increasing housing prices.”
But, “No studies of its effects indicate that it increases housing supply or contributes to broadly lower prices. It benefits a small portion of low- and moderate-income households rather than targeting aid at the households that need it most,” she found.
Hamilton also stresses, as many developers do, that “serious improvement to housing affordability requires substantial land-use policy reform that will allow significantly more housing construction, including low-cost housing typologies.”
“Under land-use policy that allows new housing to be built in response to increasing demand, inclusionary zoning would be a clear tax on construction … .”
Hamilton reminds that even under vastly liberalized housing policy, some households will struggle to afford shelter.
“But taxing housing construction with the goal of creating more abundant housing for people of relatively low income levels doesn’t make sense,” she says.
“Rather than using inclusionary zoning to appear as if they’re pursuing housing affordability, policymakers who are actually concerned about affordability should reform exclusionary [emphasis added] zoning and provide targeted support to those households that need it,” Hamilton concludes.
The less-fettered marketplace indeed can do much to make housing more affordable. But that won’t be possible if government policies tie developers’ hands behind their back then criticize developers for not developing. Then, and with great hubris, government-types call this “greedy.”
There’s a competing proposal being considered by city planners in hopes of adding to Pittsburgh’s affordable housing stock, by Councilman Bob Charland. But while ostensibly leaving it to individual neighborhoods to decide what mandates, if any, to impose, it’s just as market perverting as Gainey’s citywide inclusionary zoning plan.
Again, per the P-G:
“It also would require the city, the Pittsburgh Urban Redevelopment Authority, or the Housing Authority to ‘fully fund’ any financial gaps in projects involving the creation of affordable housing.”
But forcing taxpayers to cover the cost of a dubious public policy choice does not make said policy “affordable.” It only confirms that the policy is flawed and the work of sophists.
As City Council President R. Daniel Lavelle told the P-G, it would “literally almost bankrupt us.”
And the people who pay for such things, too — taxpayers.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
