Kansas City may soon demand affordable housing from developers seeking tax incentives
Kansas City’s lucrative tax incentive deals designed to spur apartment construction may soon come with a major condition: that developers include affordable units or pay fees to City Hall.
A City Council committee on Wednesday unanimously passed legislation that would require those developers to set aside 20% of the units for cheaper rent. Half of those must be affordable to residents earning 70% of the area’s average income and the other half for those earning less than 30% of the average.
Developers who don’t fulfill that requirement must pay 110% of the construction cost of those units into a housing trust fund.
The full City Council will consider the proposal next week. It’s a program long in the making.
Mayor Quinton Lucas proposed a similar ordinance in 2018 when he was a councilman representing the 3rd District at-large and chaired the housing committee. But it was held again and again. That particular piece of legislation hasn’t been considered since 2019.
Lucas and Councilwoman Melissa Robinson, 3rd District, introduced the new legislation in December.
Lucas said in a statement following the vote that he was “elated” to see it pass unanimously.
“It is a vital and overdue step in providing housing for families and individuals at all income levels in Kansas City,” Lucas said. “At a time when so many lack access to safe, quality and affordable housing, this legislation shows that Kansas City cares about all people as we develop our city for the future.”
Robinson said that the legislation was a “baby step” in the right direction, but that the city needed to move toward “inclusionary zoning,” requiring developers to build affordable units even if they don’t receive tax incentives.
Robinson said the legislation would be especially helpful in Midtown as development springs up along Main Street in anticipation of the streetcar extension, which is expected to open in 2025.
“We don’t want to outgrow affordability for the average family, and this gives us an opportunity to keep that in focus and mind to the extent that we’re giving out incentives,” she said.
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, Robinson noted, the ordinance is silent. The city needs comprehensive reform and a study to identify the types of units it needs and where.
Councilman Dan Fowler, 2nd District, said in December that he was concerned about asking for more affordable housing from developers while the city is considering reforming its incentive programs.
He supported the measure Wednesday but said it may require more incentives from the city to get developers to build affordable units.
The proposal is the first major housing reform the City Council has considered since the Tenants Bill of Rights passed last year.
But Tara Raghuveer, who founded the tenants rights group KC Tenants, said in other large cities, similar programs have not yielded large scale construction of affordable units.
“This is not the type of program that tends to lend the biggest, most systemic change that we need,” she said.
Jenay Manley, a leader in KC Tenants, said in a statement the city “too often leaves people who are impacted by housing insecurity out of policy conversations.”
“And it shows. Affordability should be defined according to what people need, not what is affordable for developers to build.”
Manley said half of the affordable units built through the proposal “are definitely not affordable for the people who need homes.”
Kansas City officials have said the most severe housing shortages are among the lowest-income families.
The 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 assistance from the federal government through a Section 8 voucher.
Landlords are not required to participate in Section 8. In many cases, that makes it difficult for recipients to find housing. They are only given a few weeks to secure a home once their vouchers are approved.
KC Tenants pushed for a more encompassing version of the policy in 2019 when the City Council passed its Tenant Bill of Rights, but the housing committee “unceremoniously left it on the cutting room floor,” KC Tenants said on Twitter in December.
Before the bill of rights passed, the city’s housing committee added language saying the city would not require landlords “to participate in an otherwise voluntary benefit or subsidy program.” That’s the part of the code the proposal references.
At the time that language passed, Brandon Weiss, then an associate professor at the University of Missouri-Kansas City, said that muddied the question of whether landlords would have to accept vouchers and other forms of assisted payment.
In December, Weiss, now an associate professor of law at American University, told The Star the proposal “falls short” of a broad ban on such practices, like the laws passed in more than 100 other cities and states. He said the projects that would fall under the rule represent a “very small percentage of the overall housing stock.”
Robinson said she supported a broader ban.
