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Mayor Cantrell’s Mandatory Inclusionary Zoning Housing Policy Takes Effect

NEW ORLEANS – Mayor LaToya Cantrell today announced the start this week of the City’s Mandatory Inclusionary Zoning Housing Policy, a long-awaited, landmark change to the City’s zoning code that requires developers to build affordable housing units in neighborhoods with some of the highest housing costs in the city. With the policy taking effect, New Orleans becomes one of the first cities in the Southeast to implement a mandatory inclusionary housing program.

The policy, which takes effect Thursday, July 1, mandates that developers provide affordable housing units in new construction or rehabilitated housing that contains more than 10 housing units in the CBD, French Quarter, Marigny-Bywater, Treme, Mid-City, and Lower Garden District.

(Access the map at https://property.nola.gov/ and click on the Mandatory Inclusionary Zoning layer tab.)

This applies to all new multi-family rental developments, whether stand-alone or mixed-use buildings. Beginning Thursday, these developments will be required to set aside either 5% or 10% of rental units for New Orleanians making 60% of the Area Median Income or approximately $42,060 for a family of four. Based on 2021 HUD income limits, the maximum rent for a two-bedroom unit would be $946.50 per month.

These units must remain affordable for 99 years. In exchange for providing affordable housing units, developments are entitled to development bonuses, parking reductions, and financial incentives in the form of a tax abatement. For those who would rather pay a one-time fee, there is an option to do that as well. Developments located outside the mandatory areas are eligible to take advantage of the incentives by opting into the voluntary inclusionary housing provisions.

“Due to the hard work of our City’s housing advocates and development partners, the City Planning Commission, the City Council, and my Administration, affordable housing for our residents will be required in some of our highest opportunity neighborhoods when we implement the City’s first-ever Mandatory Inclusionary Zoning ordinance. Every resident deserves a safe place to live and thrive and this program will provide housing opportunities to those residents who are vital to our city’s economic vitality. This program is for residents who are often excluded from being able to live in the neighborhoods close to employment and services,” said Mayor Cantrell.

Research has shown that the resources that come with living in high-opportunity neighborhoods help reduce the intergenerational persistence of poverty. Interventions such as inclusionary zoning have proven to dramatically change a family’s ability to provide their children with upward mobility by providing fairness and equitable access to neighborhoods with more resources.

“As Councilmember for District B, one of my top priorities has been to promote and maintain affordable housing opportunities that keep New Orleanians in their neighborhoods. Throughout the city, access to affordable housing is in a critical state. This comprehensive set of policies is aimed at attacking the zoning and economic aspects of the crisis with both incentives and mandates for new developments,” said Jay H. Banks, City Councilmember, District B.

“Solving the affordable housing crisis requires multiple interventions, implementing inclusionary housing requirements is a major step in bringing affordable housing to high opportunities areas that have become off-limits to low to moderate-income households,” said Marjorianna Willman, Director, Office of Housing Policy and Community Development.

“New Orleans families have sustained many environmental and economic disasters over the last 16 years increasing the need for affordable housing and economic opportunity. The inclusionary housing policies launched by Mayor Cantrell’s Office and the City Council are designed to stimulate the creation of more affordable housing in core areas of the city. Such a large initiative requires multi-agency collaboration and Finance New Orleans is eager to play its role. Finance New Orleans is providing value to this initiative by providing public financing tools for developers including property tax abatements, housing bonds and green infrastructure financing. The end goal is to increase the ongoing availability of affordable and sustainable housing for New Orleans families,” said Damon Burns, CEO, Finance New Orleans.

“We’ve been working on the Smart Housing Mix since 2015 and it’s even more necessary now because of how the pandemic has exacerbated our housing crisis. It’s also exciting to finally see it implemented because it is a vindication of the idea that if we want a city where the people who make our culture can still afford to live, then everyone has to pitch in,” Cashauna Hill, Executive Director, Louisiana Fair Housing Action Center.

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