- New funding source for creating affordable housing
- Establishing Tax Increment Financing Area
- Culmination of years-long planning effort
ARLINGTON, Va. – The Arlington County Board today adopted a set of financial tools to help preserve the affordability of the 6,200 existing market rate affordable homes along the Pike as it is transformed to a more walkable, transit-oriented neighborhood.
The financial tools – Tax Increment Financing (TIF) and the Transit Oriented Affordable Housing (TOAH) fund – are key elements of the financial tools package that will help the County reach the ambitious affordable housing goals identified in the Columbia Pike Neighborhoods Area Plan.
“Arlington County is absolutely committed to ensuring that even as Columbia Pike transforms into a 'Main Street' for south Arlington, it will remain diverse and affordable,” said Arlington County Board Chairman J. Walter Tejada. “Adopting these innovative new tools will help us meet our goal of preserving existing affordable homes and creating more.”
The County Board voted 5 to 0 to adopt a resolution to establish a Transit Oriented Affordable Housing Fund (TOAH). The Board also voted 4 to 1 to establish a Tax Increment Financing (TIF) area for the defined revitalization districts (commercial and multi-family residential areas).
Creative financing tools
One of the primary ways Arlington is able to provide affordable housing is by partnering with developers taking advantage of the federal Low Income Housing Tax Credit (LIHTC) program. The tax credit award process is highly competitive and takes into account many factors, including the total cost of building a project.
The TOAH fund will enable the County to help affordable housing developers reduce costs and increase their competitiveness for tax credits.
Dedicated funding for affordable housing on the Pike
The Columbia Pike Tax Increment Financing is envisioned to be the primary revenue source for the TOAH fund.
With the TIF, 25 percent of the new tax revenue growth generated by new development and property appreciation in the defined commercial and multi-family residential revitalization districts will be dedicated to affordable housing along the Pike.
“It is only right that a portion of the additional property taxes the County will realize from new development along the Pike will be used to preserve the Pike's affordability,” said Tejada.
The Columbia Pike Increment Financing Area is the County's second TIF area. The first TIF area was established in 2010 with the adoption of the Crystal City – Pentagon City – Potomac Yard TIF area. TIF is a funding mechanism used by many local governments to support redevelopment projects.
Transfer of Development Rights
On a related action, the County Board voted 5 to 0 to adopt amendments to the Policy Guidance for Transfer of Development Rights (TDR) and a Zoning Ordinance amendment to include TDR regulations under the Columbia Pike Neighborhoods Form Based Code. The adopted TDR tool will help implement the Columbia Pike Neighborhoods Area Plan goals for preservation of affordable housing within two historically significant garden apartment complexes and the preservation of public open spaces.
These implementation tools are part of the package of tools developed to carry out the goals identified in the Columbia Pike Neighborhoods Area Plan. In November, the Board adopted a new Form Based Code for the Pike's residential areas. Developers and property owners who choose to use the FBC, and who meet the requirement that 20 to 35 percent of their new units will be affordable for households earning between 40 to 80 percent of the Area Median Income (AMI), will be allowed to add more density than permitted under by-right zoning.
The Columbia Pike Neighborhoods Area Plan provides a framework for future public and private investment decisions to match the community's goals for the Pike. Those goals include ensuring the community is diverse and offers a mix of housing options for current and future residents, while the neighborhood is transformed into a “green” neighborhood with sustainable buildings, great public spaces and shopping, new streets, more walkable sidewalks, more attractive landscape and better access to various modes of transportation.
The ambitious plan seeks to find the right balance among goals of maintaining a mixed-income community with the preservation of affordable housing, improving the urban form of buildings and public space, and preserving historically significant buildings. Since the late 1990s, Arlington County has partnered with residents, community leaders, and owners of businesses and property along the Pike to plan the corridor's revitalization.
To learn more, visit the County website to read the staff report. Scroll down to Item 23 on the Agenda for the December 14, 2013 Regular Meeting.
Learn more about revitalization efforts on Columbia Pike.