2023 -- S 0876

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LC002753

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

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A N   A C T

RELATING TO TOWNS AND CITIES – ZONING ORDINANCES

     Introduced By: Senators Gu, Kallman, Britto, and Tikoian

     Date Introduced: March 30, 2023

     Referred To: Senate Housing & Municipal Government

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 45-24-46.1 of the General Laws in Chapter 45-24 entitled "Zoning

Ordinances" is hereby amended to read as follows:

     45-24-46.1. Inclusionary zoning.

     (a) A zoning ordinance requiring the inclusion of affordable housing as part of a

development shall provide that the housing will be affordable housing, as defined in § 42-128-

8.1(d)(1); that the affordable housing will be of comparable size and quality to the market-rate

housing; that the affordable housing will constitute not less than ten percent (10%) of the total units

in the development; and that the units will remain affordable for a period of not less than thirty-

years (30) from initial occupancy enforced through a land lease and/or deed restriction enforceable

by the municipality and the state of Rhode Island.

     (b) A zoning ordinance that includes inclusionary zoning may provide that the affordable

housing must be built on-site or utilize one or more alternative methods of production, including,

but not limited to, off-site construction or rehabilitation, donation of land suitable for development

of the required affordable units, and/or the payment of a fee in lieu of the construction or provision

of affordable housing units. For all projects subject to inclusionary zoning, density bonuses and

other incentives shall be established by the community and shall apply to offset differential costs

of below-market units.

     (c) This fee in lieu of the construction or provision of affordable housing shall be the choice

of the developer or builder applied on a per-unit basis and may be used for new developments,

purchasing property and/or homes, rehabilitating properties, or any other manner that creates

additional low-or-moderate income housing as defined in § 45-53-3(9). Notwithstanding anything

to the contrary in this section, when the size of a development triggers a requirement in a zoning

ordinance for one or more affordable housing units, the unit(s) shall be created. Payment of a fee

in lieu of the construction or provision of affordable housing units is permissible only to pay for

fractions of units (i.e. when only a fraction of one full unit is required or for fractions of units

beyond one or more full units).

     (1) For In order to pay for a fraction of an affordable single-family homes and

condominium units unit, the fraction will be multiplied by the per-unit fee for the development.

The per-unit fee shall be the difference between the maximum affordable sales price for a family

of four (4) earning eighty percent (80%) of the area median income as determined annually by the

U.S. Department of Housing and Urban Development and the average cost of developing a single

unit of affordable housing. The average cost of developing a single unit of affordable housing shall

be determined annually based on the average, per-unit development cost of affordable homes

financed by Rhode Island housing over the previous three (3) years, excluding existing units that

received preservation financing.

     (2) Notwithstanding subsection (c)(1) of this section, in no case shall the per-unit fee for

affordable single family homes and condominium units be less than forty thousand dollars

($40,000).

     (d) The municipality shall deposit all in-lieu payments into restricted accounts that shall be

allocated and spent only for the creation and development of affordable housing within the

municipality serving individuals or families at or below eighty percent (80%) of the area median

income. The municipality shall maintain a local affordable housing board to oversee the funds in

the restricted accounts and shall allocate the funds within two (2) five (5) years. The municipality

shall include in the housing element of their local comprehensive plan, if applicable, the process it

will use to allocate the funds.

     (e) As an alternative to the provisions of subsection (d), the municipality may elect to

transfer in-lieu payments promptly upon receipt or within the two-year (2) five-year (5) period after

receipt to the housing resources commission, the Rhode Island department of housing, or Rhode

Island housing for the purpose of developing affordable housing within that community.

     (f) Rhode Island housing shall report to the general assembly and the housing resources

commission the amount of fees in lieu collected by community; the projects that were provided

funding with the fees, the dollar amounts allocated to the projects and the number of units created.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TOWNS AND CITIES – ZONING ORDINANCES

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     This act would provide that affordable housing shall be of comparable size and quality to

market-rate housing and further provide that when there is a requirement for one or more affordable

housing units triggered by the size of a development, the units must be created.

     This act would take effect upon passage.

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