Developers seeking incentives to build apartments in Kansas City will soon have to include affordable units or pay into the city’s housing trust fund.
City Council members voted unanimously Thursday in favor of the legislation — with some changes to the original. They were scheduled to vote on the issue last week, but postponed after an outcry from developers claiming the legislation would kill business for apartment builders in town.
Leaders in Kansas City have talked for years about ways to offer more affordable housing, and the City Council previously considered similar legislation offered by Mayor Quinton Lucas, then a councilman, but it stalled out more than a year ago.
“This is not the end-all of the discussion of affordable housing,” Councilwoman Andrea Bough said. “We have a lot of work to do moving forward, and we will commit to continue that work.”
As of April 8, developers receiving incentives must set aside 20% of the units in the building — half of those affordable to families earning 70% of the area median income and the other half to those earning 30%.
Cities around the country impose similar requirements. And some, under a policy called “inclusionary zoning,” require it for all construction, not just projects receiving tax incentives.
But the council voted unanimously to add an amendment that includes exemptions. The legislation won’t apply to projects receiving low-income housing tax credits or involving historic buildings.
It also grandfathers in projects that have already applied for incentives, as long as they are awarded within three years after the legislation takes effect. The amendment also says the council could consider “alternative means” of providing units for those earning 30% of the area median income.
“Our goal today … is to say that folks are listening and working on ways to make sure this could be the best ordinance it can, but that it is time,” Lucas said. “It is time to vote. It is time to commit for this city to progress on affordable housing.”
Developers who don’t fulfill the affordable housing requirement must pay 110% of the construction cost of those units into a housing trust fund. Kansas City has long discussed the affordable housing crisis its residents face, but has not committed significant new resources to fix the shortage.
When Lucas ran for mayor, he envisioned a $75 million housing trust fund that has not been filled.
Often, the incentives Kansas City considers are for developers building market-rate or luxury apartments with one or two bedrooms. But the city also faces a shortage of units large enough for families.
That’s where, Councilwoman Melissa Robinson previously noted, the ordinance is silent. The city needs comprehensive reform and a study to identify the types of units it needs and where.
The legislation was supported by several local advocacy groups, including the Urban Neighborhood Initiative, led by Dianne Cleaver, who submitted testimony to the council.
“Every day that we delay in instituting equitable housing policies is a day that opportunities for affordable housing for real people in dire need are lost,” Cleaver wrote to council members. “It is also a day more people live in unhealthy housing, are without stable housing or are effectively or literally homeless.”
Developers and construction firms who submitted testimony to the City Council worried the legislation would kill business in Kansas City, especially considering a council committee is expected to hear legislation reforming the city’s incentive programs next week.
“While I appreciate the need to incentivize the development of affordable housing, I think the ordinance, as currently written, will actually hinder all multi-family residential development and result in less overall economic growth and development in Kansas City,” Richard Wetzel, a partner at Centric construction, wrote to council members.
Thursday’s legislation also includes a provision requiring developers to agree that neither they, nor any successive owners of the apartments, will “engage in any discriminatory housing practices” as defined by the city code, including discrimination based on source of income. That’s designed to require landlords to accept tenants receiving federal assistance through a Section 8 voucher.
Some landlords don’t accept such tenants, making it difficult to find housing because recipients are only given a few weeks to secure a lease once their Section 8 vouchers are approved.
But the city’s requirements on whether landlords must accept the vouchers are unclear.
KC Tenants, which advocates for the city’s renters, pushed for a citywide ban on “source of income discrimination” as part of the Tenant Bill of Rights the council passed in 2019. But before it passed, the council added language saying it would not require landlords “to participate in an otherwise voluntary benefit or subsidy program,” muddying the question of whether the city code actually required landlords to take Section 8 vouchers.
More than 100 other cities and states have passed such protections.