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RATIONALE 1P Allowing developers to access additional height or density in exchange for a A greater fee -in -lieu or providing more onsite affordable housing units than required could simultaneously promote greater housing density, provide funding for the City's inclusionary housing program, and increase ➢ Housing Goals development feasibility. DESCRIPTION CAREFUL CALIBRATION A financial analysis conducted during this Housing Plan demonstrated that residential projects could contribute a higher fee -in -lieu in exchange for additional height or density under the City's existing inclusionary program. The City should consider adding a voluntary inclusionary program option in defined areas where additional height or density may be appropriate. The analysis indicated the fee could be up to $12.17 per square foot for rental units and $14.36 per square foot for for -sale units, depending on height and parking requirements. As part of this action item, the City should also evaluate height or density bonuses for projects that provide onsite affordable housing units and clarify that the fee in lieu is optional for all residential projects versus mandatory. Exhibit 26: Potential Fee Adjustments, Multifamily Housing Development Source: ECONorthwest Encourage the program's use by creating enough incentive for the developer by ensuring 30%- 50% of the financial benefit from the height bonus goes to the developer rather than opting for the highest viable fee (effectively cancelling out any financial incentive achieved through the height bonus). Three stories (120 units, 117,000 sf), existing parking $4.72 per sf (current) $9.24 per sf (current) requirements Four stories (160 units, 157,000 sf), existing parking $6.24-$6.84 per sf $10.18-$10.56 per sf requirements Four stories (160 units, 157,000 sf), reduced parking $10.04-$12.17 per sf $ 12.90-$ 14.36 per sf requirements It's important to note that there are many tools the City can developers to unlock additional density. Flexibility in site standards is key to making projects work across a wide variety of site shapes and sizes. Other incentives might include reduced open space and parking, increased lot coverage, or a higher Floor Area Ratio. ACTION 1.2 BENEFITS SUMMARY INCOME LEVEL GEOGRAPHIC ACTION TYPE HOUSING PRODUCTION COST SERVED SCALE Incentive/Policy Low -Moderate Citywide Change Louisville Housing Plan Part 4: Housing Strategies and Actions 32