OLR Bill Analysis

sHB 6880 (as amended by House "A")*

AN ACT CONCERNING THE AFFORDABLE HOUSING LAND USE APPEALS PROCEDURE.

SUMMARY

This bill makes several changes to the affordable housing land use appeals procedure (“procedure”) (see BACKGROUND). The bill makes it easier for municipalities to qualify for a moratorium from the procedure by:

1. expanding the unit types that count toward the moratorium;

2. establishing “bonus” housing unit-equivalent (HUE) points for certain unit types;

3. lowering the minimum number of HUE points smaller municipalities need for a moratorium; and

4. lowering the minimum number of HUE points municipalities with at least 20,000 dwelling units need for a moratorium, if the municipality previously qualified for a moratorium and adopts an affordable housing plan.

The bill also:

1. requires municipalities to adopt an affordable housing plan every five years;

2. makes an additional type of mobile manufactured homes count toward the 10% exemption threshold (see BACKGROUND);

3. extends, from four years to five, the length of second and subsequent moratoria for municipalities with at least 20,000 dwelling units;

4. changes the definition of “median income” applicable to the incentive housing zone (IHZ) statutes, conforming it to the affordable housing land use appeals procedure statutes; and

5. makes technical and conforming changes.

*House Amendment “A” adds the provisions (1) establishing a municipal affordable housing planning requirement; (2) concerning resident-owned mobile manufactured home parks; (3) lowering the moratorium eligibility threshold for municipalities with at least 20,000 dwelling units; and (4) increasing the length of second and subsequent moratoria for municipalities with at least 20,000 dwelling units.

EFFECTIVE DATE: Upon passage, but the definition of “median income” does not apply to IHZs that the Department of Housing (DOH) approves, or approves grants for, before passage. The bill sunsets on September 30, 2022 the moratorium-related provisions concerning IHZ units, bonus points, and the lowered threshold for smaller municipalities.

MUNICIPAL PLANNING REQUIREMENT

The bill requires each municipality, at least once every five years, to prepare or amend and adopt an affordable housing plan. The plan must specify how the municipality will increase the number of affordable housing developments in its jurisdiction. The bill does not specify which municipal body must adopt the plan.

In preparing their plans, municipalities may hold informational meetings or organize other activities to keep residents informed. If a municipality holds a public hearing on a plan's adoption, at least 35 days before the hearing, it must (1) file a copy of the draft plan and any amendments thereto in the town clerk's office and (2) post the draft on the municipality's website, if one exists. Similarly, after a municipality adopts its plan, it must file it in the town clerk's office and post the plan on its website, if one exists.

Municipalities must regularly review and maintain their plans, making geographical, functional, or other amendments as needed. If a municipality does not update its plan at least once every five years, its chief elected official must submit a letter to the DOH commissioner explaining why. The bill does not establish any penalties for failure to comply with its affordable housing plan requirements.

RESIDENT-OWNED MOBILE MANUFACTURED HOME PARKS

The bill defines “resident-owned mobile manufactured home parks” and (1) requires DOH to count homes in them as part of a municipality's affordable housing stock (i.e., toward the 10% exemption threshold) and (2) makes such homes eligible for HUE points toward a moratorium.

Under the bill, “resident-owned mobile manufactured home parks” are parks with homes located on land that at the time a loan for the purchase of the land is issued, is subject to deed restrictions requiring 75% of the units (presumably, parcels of land) to be leased to households earning 80% or less of the median income and of these income-restricted units, either:

1. 40% to be leased to households earning 60% or less of the median income or

2. 20% to be leased to households earning 50% or less of the median income.

The bill specifies how many points homes in these parks are eligible for (see Table 1 below). It does not specify how long the required deed restrictions must last.

By law, unchanged by the bill, mobile manufactured homes with deed restrictions restricting the sale or rental of such homes to low- or moderate-income people (1) are counted by DOH toward a municipality's affordable housing stock if deed restricted for at least 10 years and (2) qualify for HUE points toward a moratorium if deed restricted in accordance with the law (generally, a 40 year restriction).

MORATORIA

By law, a municipality is eligible for a moratorium from the procedure each time it shows it has added a certain number of affordable housing units since the last decennial census. Newly built set-aside and assisted housing developments count toward the moratorium, as do units subject to certain deed restrictions. Moratoria are not applicable to certain assisted housing development proposals.

Five Year Moratoria

Under current law, a moratorium lasts for four years. The bill lengthens the duration of a moratorium for municipalities with at least 20,000 dwelling units, as of the last decennial census, and that previously obtained a moratorium under CGS 8-30g. Under the bill, in these municipalities, second and subsequent moratoria last five, rather than four, years.

Lower HUE Points Requirement

Under current law, a municipality is eligible for a moratorium if it shows it has added affordable housing units, measured in HUE points, equaling the greater of (1) 2% of the housing stock, as of the last decennial census, or (2) 75 HUE points.

The bill lowers the 2% standard to 1.5% for municipalities that have adopted an affordable housing plan and have at least 20,000 dwelling units, if the municipality is applying for its second or subsequent moratorium under CGS 8-30g.

Effective upon passage and through September 30, 2022, the bill lowers, from 75 to 50, the minimum number of HUE points municipalities need to qualify for a moratorium. (In practice, this affects smaller municipalities.)

Calculating HUE Points Toward a Moratorium

Homes in Resident-Owned Mobile Manufactured Home Parks. The bill establishes a schedule of base points specifically for homes in resident-owned mobile manufactured home parks, based on the occupants' income, as shown in Table 1. (Under the bill, it is unclear whether the points are allocated based on occupancy on the day the municipality applies for a moratorium, or at another point in time.)

Table 1: Points for Homes in Resident-Owned Mobile Home Parks

Unit Type

Base HUE Point Value (per unit)

Owned or rented homes occupied by households earning 80% or less of the median income

1.5

Owned or rented homes occupied by households earning 60% or less of the median income

2.0

Owned or rented homes not otherwise eligible for points

0.25

*Median income means the lesser of the state median income or the area median income, after adjustments for family size.

Under existing law unchanged by the bill, mobile manufactured homes that meet the statutory requirements are eligible for base HUE points, which vary depending on home affordability, population served, and ownership type (see BACKGROUND).

Incentive Housing Development (IHD) Units. Effective upon passage and through September 30, 2022, the bill allows income-restricted (“restricted”) units in an IHD to count toward a moratorium and applies existing law's base points schedule to them (see BACKGROUND). An IHD is a residential or mixed-use development located within an IHZ in which at least 20% of the units are restricted.

By law, IHD units must be deed-restricted for at least 30 years, which is 10 years fewer than the minimum 40 year period that units, other than assisted housing developments, must generally be deed restricted for to qualify for HUE points under the law. (In practice, however, most assisted housing developments are also deed restricted for at least 40 years.)

Bonus HUE Points. By law, certain rental family units in set-aside developments are eligible for bonus HUE points. Bonus points are awarded on top of the base HUE points a unit receives.

Effective upon passage and through September 30, 2022, the bill makes three additional categories of units eligible for bonus HUE points. The bill establishes a quarter-point bonus for restricted family units (1) with at least three bedrooms or (2) in an IHD. Restricted elderly units receive a half-point bonus, if at least 60% of the restricted units counted toward the moratorium are family units (i.e., elderly units do not receive a half-point bonus if they make up more than 40% of the restricted units counted toward the moratorium). Table 2 shows the bonus HUE points under current law and the bill.

Table 2: Bonus HUE Points

Unit Type

Bonus HUE Point Value (per unit)

Current Law

Bill

Owned or rented restricted family units in an IHD

No bonus

0.25 bonus

Owned or rented restricted family units with at least 3 bedrooms

No bonus

0.25 bonus

Owned or rented restricted elderly units, if at least 60% of restricted units used toward the moratorium are family units

No bonus

0.50 bonus

Rental family units in a set-aside development, if the developer applied for local approval before 07/16/1995

Bonus equal to 22% of the total points awarded to such development

No change

IHZ: DEFINITION OF MEDIAN INCOME

The bill conforms the definition of “median income” applicable to IHDs to the definition applicable to the affordable housing land use appeals procedure statutes. Under current law, restricted units in an IHD must be affordable to individuals earning 80% or less than the area median income (AMI). The bill instead requires restricted units in an IHD to be affordable to individuals earning 80% or less of the AMI or state median income (SMI), whichever is less. The new definition of “median income” does not apply to IHDs in IHZs that DOH approves, or approves grants for, before the bill's passage.

An IHZ is an overlay zone allowing developers to build, as a matter of right, high-density housing close to existing or planned infrastructure. By law, DOH may make grants to municipalities that adopt, or are working to adopt, IHZ regulations (CGS 8-13m et seq.).

BACKGROUND

Affordable Housing Developments

Under CGS 8-30g, “affordable housing development” means a housing development that is (1) assisted housing or (2) a set-aside development. “Assisted housing” means housing that receives government assistance to construct or rehabilitate low- and moderate- income housing, or housing occupied by individuals receiving rental assistance (e.g., Section 8). A “set-aside development” is a development in which, for at least 40 years after initial occupancy, at least (1) 15% of the units are deed restricted to households earning 60% or less of the AMI or SMI, whichever is less and (2) 15% of the units are deed restricted to households earning 80% or less of the AMI or SMI, whichever is less.

The Affordable Housing Land Use Appeals Procedure

The procedure is a set of rules requiring zoning and planning commissions to defend their decisions denying affordable housing developments or approving them with certain conditions. In traditional zoning appeals, the developer must convince the court that the municipality acted illegally, arbitrarily, or abused its discretion by rejecting his or her proposed development. The procedure instead places the burden of proof on municipalities. By law, a developer cannot appeal under the procedure in a municipality (1) in which DOH determines at least 10% of the housing stock is affordable or (2) that obtains a moratorium.

The following dwellings count toward the 10% exemption threshold:

1. assisted housing,

2. housing currently financed by Connecticut Housing Finance Authority mortgages,

3. housing subject to deeds or conditions restricting the sale or rental to low- or moderate-income people, and

4. housing that consists of mobile homes or accessory apartments subject to similar deed restrictions.

Schedule of Base HUE Points

Base HUE points are weighted based on unit affordability, population served, and ownership type. Table 3 shows the types of units that count toward a moratorium and their HUE point value, as established in CGS 8-30g.

Table 3: Base HUE Points

Unit Type

HUE Point Value (per unit)

Owned or rented market-rate unit in a set-aside development

0.25

Owned or rented elderly unit restricted to households earning no more than 80% of the median income

0.50

Owned family unit restricted to households earning no more than:

80% of median income

1.00

60% of median income

1.50

40% of median income

2.00

Rented family unit restricted to households earning no more than:

80% of median income

1.50

60% of median income

2.00

40% of median income

2.50

*Median income means the lesser of the state median income or the area median income, after adjustments for family size.

Related Bill

sSB 535 (File 199), reported favorably by the Housing Committee, also makes changes to the affordable housing land use appeals procedure and an IHZ statute.

COMMITTEE ACTION

Housing Committee

Joint Favorable Substitute

Yea

10

Nay

3

(03/07/2017)