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1 | HR&A Advisors
1 City of Anaheim Affordable Housing Program Options
February 15, 2024
Prepared for the City of Anaheim
Descriptions of Techniques to Increase
Housing Supply in the City of Anaheim
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2 | HR&A Advisors
2 City of Anaheim Affordable Housing Program Options
Agenda
Introductions 3
Candidate Housing Supply Techniques 6
Land Use, Zoning, and Regulatory Reforms 12
Funding and Financing 19
Other Programs or Policies 26
Appendix 31
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3 | HR&A Advisors
3 City of Anaheim Affordable Housing Program Options
Introductions
01 3
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4 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Our team members bring extensive experience analyzing and developing affordable housing programs across California and elsewhere in the U.S.
PAUL SILVERN
Partner-in-Charge
ADA PENG
Director
ANNA GALLICCHIO
Senior Analyst
INTRODUCTION | HR&A Advisors
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5 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options HR&A’s national Housing Practice addresses housing market and housing affordability issues at three mutually reinforcing levels.
5 INTRODUCTION | HR&A Advisors
HOUSING STRATEGIES
Creating strategies and plans
based on local needs,
priorities, and market
conditions
HOUSING POLICIES &
PROGRAMMING
Designing policies,
programs, and regulations that
align community goals with
market conditions
HOUSING TRANSACTIONS
Advising on the development
and preservation of housing
developments
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6 City of Anaheim Affordable Housing Program Options
Local Context
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7 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options There is a significant need for production of both affordable and market rate housing over the next 5 years in Anaheim. 2021-2029 targets set Anaheim’s RHNA allocation at 17,453 units.
Local Context| Housing Production Need
2021 – 2029 RHNA Targets
Income Category
(AMI = Area median
Income*)
Number of
Units
Percent of
Total
Very Low (<50% of AMI) 3,767 21.6%
Low (50% to 80% of AMI) 2,397 13.7%
Moderate
(80% to 120% of AMI) 2,945 16.9%
Above Moderate
(>120% of AMI) 8,344 47.8%
TOTAL 17,453 100%
For Anaheim's 2021-2029 Housing Element Update, the City's RHNA allocation is 17,453 housing units, with the following income level breakdown:
• Median gross rent in Anaheim was $1,955
in 2022.
• Only 3% of all homes were vacant and
available to be occupied in 2022.
• 52.6% of all renters and 29.2% of
homeowners in Anaheim in 2021 were
"cost burdened," or paying more than
30% of their income on rent.
American Communities Survey (ACS 5-Year), 2021 and 2022. *Orange County's current AMI for a family of four is $103,000 DRAFT
8 | HR&A Advisors
8 City of Anaheim Affordable Housing Program Options
Candidate
Housing Supply
Techniques
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9 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options HR&A developed a list of plausible techniques to increase housing supply in Anaheim. The list is intended to assist staff in developing recommendations to be provided to the City Council for more detailed evaluation of preferred approaches.
Housing Techniques | Techniques for Housing Production
Land Use, Zoning,
and Regulatory
Reforms
Funding and
Financing
Other Programs
and Policies
• Expanding By-Right Housing Zones (upzoning)
• Allow Flexibility in Design, Development and/or Zoning • Workforce (Moderate-Income) Housing Incentive Programs • Incentive Zoning (mandatory and/or incentive-based)
• Affordable Accessory Dwelling Units and JADUs Programs • Office, Hotel and Retail Conversion Incentive Programs • Local Housing Trust Fund
• Housing Loan Fund
• Expanded Property Tax Relief to Support Moderate-Income Housing • Post-Redevelopment Tax Increment Financing Measures
• Affordable Housing on Public and Faith-based Owned Land • Standardized Development Agreement Strategy
• Land Bank
• Maintain Housing Dashboard
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10 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Evaluating each potential housing supply technique will require an iterative process of decision-making that is responsive to the local context and focused on four conditions.
Housing Techniques | Evaluation Criteria
Alignment
How should this technique be
designed to address
Anaheim's goals?
Feasibility
What are the barriers to
successful implementation?
Implementation
How long will it take to implement
the tool? And how complex is it?
Impact
Can the technique efficiently and
effectively achieve Anaheim's
goals? Is the tool worth pursuing?
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11 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Housing Techniques | Categories
Land Use and Regulatory Reform Affordable Housing
Production
Market Housing
Production
Expanding By-Right Housing Zones (upzoning)
Allow Flexibility in Design, Development and/or Zoning
Workforce (Moderate-Income) Housing Incentive Programs
Incentive Zoning (mandatory and/or incentive-based)
Affordable Accessory Dwelling Units and JADUs Programs
Office, Hotel and Retail Conversion Incentive Programs
Expand and Sustain Funding
Local Housing Trust Fund
Housing Loan Fund
Expanded Property Tax Relief to Support Moderate-Income Housing Post-Redevelopment Tax Increment Financing Measures
Other Programs and Policies
Affordable Housing on Public and Faith-based Owned Land Standardized Development Agreement Strategy
Land Bank
Maintain Housing Dashboard
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12 City of Anaheim Affordable Housing Program Options
Land Use, Zoning,
and Regulatory
Reforms Tools
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13 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Expand By-Right Housing Zones (Upzoning)
Pros
• Potential Impact: Streamlines the process for
developing multifamily housing in high-
opportunity areas.
• Complexity: Reduces bureaucratic hurdles,
expediting housing development.
• Key Actors: Empowers developers to create
more housing without extensive approvals.
Cons
• Costs: May lead to increased property values,
affecting affordability in surrounding areas.
• Scale/Location: Limited to designated high
resource areas.
• Primary Beneficiaries: Can inadvertently
benefit developers more than lower-income
residents if not carefully managed.
Under administrative approval for by-right development, local governments can approve projects meeting underlying local zoning requirements through administrative approval.
This may include:
Expanding residential allowances in commercial zones
Allowing missing middle (upzoning single family or low-density residential zones)
Upzoning multifamily zones to higher density
Considerations
Applicability: Identify areas suitable for rezoning to allow multifamily development in more neighborhoods, particularly those that are or will be served by transit.
Implementation: Revise approval processes to limit and focus discretionary control and reduce approval times, and conform regulations with recent changes in State law.
Unintended Consequences: It is critical to establish mechanisms to mitigate displacement pressure in lower-income neighborhoods.
Definition
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14 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Allow Flexibility in Design, Development and/or Zoning Regulations
Pros
• Potential Impact: Encourages innovative
housing designs and efficient use of land,
increasing overall housing supply.
• Complexity: Simplifies and speeds up the
development process by reducing barriers.
• Costs: Potential to lower development costs,
making projects more financially viable.
Cons
• Scale/Location: Effectiveness varies depending
on local community standards.
• Primary Beneficiaries: While intended to aid
developers and eventually renters/buyers,
there's a risk of benefiting developers more than
intended without proper oversight.
• Timeline: Changes in design and other
regulations can be contentious, potentially
leading to delays in adoption and
implementation.
• Relaxing or eliminating existing development regulations (e.g., use of bird glass, tree preservation, green building standards, historic review, parking requirements, etc.) can be used as a general policy to increase housing supply or as a condition for the provision of affordable units.
• These changes may allow for improved project feasibility due to reduced costs associated with meeting specific design and zoning requirements.
Considerations
Implementation: Establish understanding of what city administered design or zoning requirements are particularly challenging and decide which can be reduced or simplified to make it easier to meet requirements, and consider new State requirements for "objective design standards."
Flexibility: Potential to reevaluate some restrictions on height, density, setbacks, and parking to ensure that multifamily and mixed- use development is feasible by-right without a special use permit.
Definition
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15 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Workforce (Moderate-Income) Housing Incentive Programs
• Workforce housing or moderate-income housing serves households making between 80% – 120% of area median income, depending on the jurisdiction. • This may include:
• A workforce housing incentives program is a zoning designation that allows developers the opportunity to build projects under alternative standards in exchange for including affordable units
• Alternative design standards or density bonus may also be applied for moderate-income units.
Considerations
Applicability: Determine what developments, developers or zones would be allowed to pursue workforce housing through the program. Implementation: It is important to weigh the public benefits with the potential expenditure of funding for these programs.
Funding: Consider pairing zoning or design standard incentives with tax relief, as described in the recommendation “Expanded Property Tax Relief to Support Moderate-Income Housing.”
Pros
• Primary Beneficiaries: Targets moderate-
income workers, often overlooked in housing
policies.
• Potential Impact: Encourages development
near public transportation and job centers.
• Complexity: Streamlines the approval process,
expediting development.
Cons
• Costs: Incentives and streamlined processes
may lead to reduced public input and oversight.
• Scale/Location: Effectiveness depends on the
availability of suitable development sites.
• Timeline: Relies on new development, which
can be a slow process.
Definition
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16 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Incentive Zoning (Mandatory and/or Incentive-based) Incentive zoning policies require and/or incentivize developers to include affordable homes as part of market rate developments, often in exchange for incentives such as density bonuses, tax abatement, fee reductions or waivers, or expedited review.
Considerations
Incentives: Decide on the structure and extent of incentive to offset lost income due to capped rental income for affordable units. Applicability: Determine which residential developments will be subject to the policy (e.g., developments with 10 units or more). Also, the target affordability level and mix of affordable units. Implementation: Offer flexible implementation options (e.g., on- site, off-site or cash payment in lieu of providing affordable homes).
Policies can be either mandatory or voluntary but tend to be most successful if affordable unit production is mandatory or incentive- based.
Feasibility: Proposed program details should be supported by financial feasibility analysis.
Pros
• Primary Beneficiaries: Low to moderate-
income individuals gain access to affordable
housing in high-opportunity areas.
• Potential Impact: Increases the availability of
affordable units within market-rate
developments.
• Timeline: On-site affordable housing can be
delivered relatively quickly as part of new
development projects.
Cons
• Costs: May increase development costs,
potentially leading to higher prices for market-
rate units.
• Complexity: Requires careful balancing to
ensure incentives are sufficient to offset lost
income
• Scale/Location: Impact may be limited to areas
with significant new development and will vary
with the condition of the real estate market.
Definition
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17 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Affordable Accessory Dwelling Units (ADU) and Junior ADU Programs
Pros
• Primary Beneficiaries: Homeowners and
renters benefit from increased naturally-
occurring and/or deed-restricted affordable
housing options.
• Complexity: Offers a straightforward,
individual-based approach to increasing
housing.
Cons
• Costs: Initial construction costs can be
prohibitive for some homeowners.
• Scale/Location: Impact may be limited based
on homeowner participation.
• Timeline: Dependent on individual
homeowner decisions and actions.
• Potential impact: Low production change.
Accessory Dwelling Units or Junior Accessory Dwelling Units are additional living quarters located on single-family lots, with the living spaces independent from the primary home. They can be built as separate structures or as a part of the primary structure. ADUs support affordability by creating new, lower cost rental opportunities on underutilized land and helping existing homeowners stay in their homes through additional rental income. Affordable ADU programs can further incentivize the production of deed-restricted ADUs with the right types of incentives (i.e., funding subsidy, increasing the number of allowed ADUs) Considerations
Implementation: Conform regulations with recent changes in State law.
Definition
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18 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Land Use and Regulatory Reform | Office, Hotel and Retail Conversion Incentive Programs
Conversions of office, hotel, or retail spaces is a national trend to fill underutilized buildings and create much-needed housing opportunities. These conversions frequently involve the reorientation of the buildings’ interior for small apartments.
This may include:
General plan/zoning code updates or overlays to allow for residential that is accompanied by relaxed design regulations, parking requirements, funding subsidies, or tax abatements
Identification of sites well suited for office to residential conversions and proactively work with developers
*
Considerations
Implementation: Improve appeal of conversions by loosening density restrictions or other requirements.
Market Dynamics: Conversions become more appealing for developers when demand for commercial space is weak (e.g., low occupancy rates and annual daily rates (ADR) for hotels; defaults) and financial subsides are available (e.g., property tax reductions).
Definition Pros
• Potential Impact: Utilizes existing structures
for housing, reducing need for new
construction.
• Key Actors: Provides opportunities for
property owners to repurpose underused
spaces.
• Complexity: Streamlines the process of
conversion.
Cons
• Costs: Conversion can be expensive, requiring
significant investment.
• Scale/Location: Limited to areas with suitable
existing commercial properties.
• Timeline: Conversion projects can be time-
consuming due to renovations and zoning
changes.
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19 City of Anaheim Affordable Housing Program Options
Funding and
Financing Tools
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20 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Housing Trust Fund or Loan Fund A Housing Trust Fund or Loan Fund are primary ways for local jurisdictions to support new affordable housing supply in their community.
Potential Funding Sources to be Explored:
Affordable housing development fees, sales of public
assets, private capital donations, local bond and/or
new tax measures.
Additional Relevant Public Funding Sources:
Future REAP funding, HUD Pro Housing and other State
grants, HCD Housing Trust Fund Matching Program,
MHSA Housing Program.
Housing Trust Funds across the U.S. leverage up to $10 of other federal, private, and philanthropic funding for
each $1 of financing supporting a project.
A Housing Trust Fund or Loan Fund in Anaheim could
provide gap financing to incentivize the creation of
denser and better-quality housing.
Housing Fund
Grants or Low-interest
loans are provided to
develop projects
Once projects are
developed and
generate revenue, they
repay the loans. That
money can then be
spent on additional
projects.
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21 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Local Housing Trust Fund
Housing Trust Funds are a source of flexible local grant and loan funding that does not carry federal restrictions and can be used to support affordable housing activities determined by local priorities. A Housing Trust Fund is the primary way for local jurisdictions to support housing in their community, by dedicating money towards a range of local housing programs.
Housing Trust Funds are almost entirely public and are flexible in terms of program goals, priorities, and expenditure terms.
Considerations
Implementation: Develop a robust funding plan, including capital for investments and annual operating funding sources.*
Applicability: Determine whether a Housing Trust Fund should support rental affordability, affordable homeownership, eviction prevention, homelessness mitigation or any combination of goals.
*There are two funds that operate in Orange County, the Orange County Housing Trust (Private) and the Orange County Housing Finance Trust (Public - OCHFT). Special requirements and use of the OCHFT increase complexity to partner with this fund.
Pros
• Primary Beneficiaries: Offers broad support
for a range of local housing programs,
benefiting low-income households.
• Potential Impact: A flexible funding source
that can address various aspects of the
housing crisis.
• Costs: Local funding allows for targeted
investments in community-specific housing
needs.
Cons
• Complexity: Managing and allocating funds
across diverse programs can be
administratively challenging.
• Scale/Location: The impact may be limited
by the amount of funds available in the trust.
• Timeline: Funding allocation and project
implementation can be a slow process.
Definition
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22 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Housing Loan Fund
Housing Loan Funds are a pool of private and public funding that can be loaned to affordable housing projects with firm repayment expectations. Housing Loan Funds tend to focus on gap funding for acquisition and development (i.e., narrower than Housing Trust Funds). May be used for small-scale infill financing, which typically cannot access larger funding sources, or mezzanine gap financing for LIHTC projects, to fill financing gaps
.
Considerations
Funding: Identify funding source(s) to be committed.
Implementation: Design streamlined development approval process that aligns with key deadlines of the LIHTC allocation cycle. Also assess if public land available to support LIHTC development.
Capacity: Identify underwriting capacity of Anaheim staff to assess proposals and ensure public dollars are maximizing public benefit. Applicability: Determine what will be eligible, and how funds will be awarded, disbursed, and administered (including repayment terms).
Pros
• Primary Beneficiaries: Supports developers
in creating affordable housing, indirectly
benefiting low-income residents.
• Potential Impact: Bridges funding gaps,
making affordable housing projects more
financially viable.
• Costs: Low-interest loans reduce the
financial burden on developers and leverage
other sources.
Cons
• Complexity: Managing a loan fund requires
careful financial oversight and risk
assessment.
• Scale/Location: Impact is dependent on
developers' willingness and ability to
undertake affordable housing projects.
• Timeline: The process of loan application
and approval can add time to project
initiation.
Definition
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23 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Commercial Linkage Fees
Commercial Linkage Fees, a category of developer impact fees, are tools used to generate affordable housing revenue by local governments. They are fees that are paid by developers of commercial development projects to mitigate the impacts of worker demand for affordable housing.
In California, linkage fees must be based on the findings of a "nexus study" and other requirements of the Mitigation Fee Act.
Considerations
Structure: Important to determine the fee levels that balance need for affordable housing without deterring commercial development. Market Dynamics: Strength of commercial market greatly impact success of the program.
Fee Determination: Many jurisdictions chose to set fees below maximums found during nexus studies to avoid legal interventions.
Pros
• Primary Beneficiaries: Generates dedicated
funding for affordable housing.
• Potential Impact: Directly links economic
development with affordability in housing.
• Flexibility: Offers a source of funding that
is flexible and can be leveraged with other
sources.
Cons
• Cost: May disincentivize commercial
development if fees are perceived as too high
or burdensome.
• Scale/Location: The effectiveness depends
on rate of commercial development and
varies depending on market conditions.
• Timeline: Funds accumulate overtime and
may not align with immediate affordability
needs.
Definition
Further information: HCD Impact Fee Study
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24 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Expanded Property Tax Relief to Support Moderate-Income Housing
Projects serving households earning less than 80% of AMI and owned by non-profits are already eligible for property tax relief associated with the Welfare Tax Exemption.
This could be expanded to produce middle-income projects (i.e., 80% -120% AMI). Local governments can reduce, waive, or reimburse local property tax payments for specific mission- motivated building owners or builders.
Considerations
Implementation: Determine the amount of benefit or tax exemption (e.g., full or partial/capped benefit, and what requirements will exist for for-profit developers.
Applicability: Establish income thresholds or identify specific development typologies to receive expanded tax relief (e.g., $55K income threshold or properties rented solely to low- or moderate- income persons or families).
Pros
• Primary Beneficiaries: Directly supports projects
serving middle-income households for whom
there are no public subsidy programs.
• Potential Impact: Makes affordable housing
projects more financially feasible.
• Costs: Tax relief can be a cost-effective way for
local governments to encourage affordable
housing development.
Cons
• Complexity: Implementing and managing tax
abatement programs requires careful planning
and administration. County property tax share
may also be needed to scale impact.
• Scale/Location: The impact may be limited if few
projects qualify for or apply for the relief.
• Timeline: Tax relief benefits are typically realized
over the long term, impacting long-term project
feasibility more than immediate funding needs.
Definition
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25 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expand and Sustain Funding | Post-Redevelopment Tax Increment Financing Measures
Tax Increment Financing Measures are value capture revenue tools that use taxes on future gains of real estate values to pay for new investments. Affordable housing is one allowed investment areas of Enhanced Infrastructure Financing Districts (EIFDs), Affordable Housing Authorities (AHAs), and Neighborhood Infill Finance and Transit Improvement Districts (NIFTI 1 and 2). Tax Increment Financing (TIF) was employed by local redevelopment agencies as a key funding resource. With the dissolution of redevelopment entities in 2012, an array of TIF instruments have persisted post-redevelopment, including those found above.
Considerations
Partnership and Approval Process: Important to consider participation, as it is voluntary for taxing entity to participate. Market Dynamics: Review existing market strength, ability to capture a significant portion of property tax, and number of property owners within the zone.
Further Information: OPR California TIFS Tools Report
Pros
• Potential Impact: Enables significant
investment in housing infrastructure,
particularly for affordable housing.
• Primary Beneficiaries: Low-income
households benefit from increased affordable
housing development.
• Costs: Utilizes future tax increments as a
funding source, minimizing immediate fiscal
impact.
Cons
• Complexity/Feasibility: Getting approval,
setting up and managing tax increment
financing districts is administratively complex.
• Scale/Location: Effectiveness depends on the
economic growth and tax increment in the
designated area.
• Timeline: Long-term financing strategy, with
impacts and benefits accruing over many years.
Definition
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26 City of Anaheim Affordable Housing Program Options
Other Programs
and Policies
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27 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Other Programs and Policies | Affordable Housing on Public and Faith- based Owned Land
Developing affordable housing on public or faith-based owned land involves the planning for the use, lease, or sale of land to support affordable housing. Strategies can take several forms, including:
Identifying suitable sites for affordable housing and making them available at a subsidy to developers and preparing sites for development; Implementing a local ordinance to align with SB-4 and ensure compliance with the Surplus Land Act;
Disposing sites (including those not suitable for housing) at market price and using proceeds to support other affordable housing efforts.
Considerations
Implementation: Provide additional funding to create mixed-income development, which are typically more challenging to fund compared to fully subsidized housing. Affordability Level: With Surplus Land Act, private developments on public land must meet a minimum 25% of on-site affordable units for lower-income households to qualify for exemption for market rate development, while local jurisdictions are able to require a higher percentage if the local market supports the financial feasibility. New California law provides more flexibility for 100% affordable projects.
Definition Pros
• Primary Beneficiaries: Provides affordable
housing options specifically for low-income
families.
• Potential Impact: Maximizes the use of
public assets to address housing shortages.
• Complexity: Streamlines the development
process by utilizing government-owned
land.
Cons
• Costs: May involve trade-offs in the use of
public land, potentially affecting other
public services.
• Scale/Location: Limited by the availability
of suitable public land for development.
• Timeline: Involves complex planning and
potential bureaucratic delays in land
disposition.
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28 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Other Programs and Policies | Standardized Development Agreements Development agreements are legal agreements between developers and jurisdictions that provide development flexibility not typically achievable through zoning ordinances. They allow for alterations to and the freezing of zoning requirements of a project, typically over an extended time period, in exchange for public benefits.
While there will always be a need for negotiations, it is helpful to set a clear baseline expectation of community benefits to streamline the process and provide clear guidance to developers on the types of projects desired by the local jurisdiction.
Considerations
Applicability: Establish criteria to determine basic feasibility (size, shape, uses, environmental constraints) and priority (zoning, utilities and roads, high-opportunity locations, meets minimum value).
Community Benefits: Typical community benefits could include on-site affordable housing or in-lieu fee, open space, land donation, workforce investment, etc.
Pros
• Potential Impact: Streamlines
development agreements, reducing time
and uncertainty.
• Complexity: Offers a clear framework for
developers and local jurisdictions.
• Key Actors: Balances developer flexibility
with community benefit requirements.
Cons
• Costs: Standardization might limit the
ability to negotiate unique community
benefits.
• Scale/Location: Applicability and
effectiveness depend on local development
contexts.
• Timeline: While streamlined, still involves
negotiation and legal processes.
Definition
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29 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Other Programs and Policies | Land Bank
Land banks, typically run by local governments or nonprofits to acquire, hold, manage, and redevelop property. Local governments can provide technical assistance or funding for the establishment or implementation of land banks. Land banks typically receive land through the tax foreclosure and auction process when a property owner loses ownership of a property for failure to pay property taxes to the jurisdiction, or sometimes from donations. Some banks have access to acquisition funds to purchase properties on the market, and private owners and municipal governments can also transfer land into a land bank.
Land banks can also be used to reserve land for future affordable housing development in high-demand areas.
Considerations
Market Dynamics: Assess existing market strength for various building typologies, and where the City could consolidate what entities hold property. Constraint: Land banks do not necessarily drastically change housing supply for larger building typologies and tend to serve smaller sites.
Definition Pros
• Potential Impact: Effectively addresses vacant
and abandoned properties, revitalizing
neighborhoods.
• Primary Beneficiaries: Benefits communities
by converting underutilized land into
affordable housing.
• Complexity: Provides a structured approach to
managing and repurposing land.
Cons
• Costs: Acquiring and maintaining properties
can be costly for land banks.
• Scale/Location: Most effective in areas with a
significant number of tax-delinquent
properties.
• Timeline: The process of acquiring, managing,
and redeveloping properties can be lengthy.
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30 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Other Programs and Policies | Maintain a Housing Dashboard A platform to provide up-to-date housing metrics and
analysis to stakeholders, providing a way for local
governments to communicate progress in achieving
affordable housing goals.
Housing dashboards may include components to assist
with streamlined zoning and development processes, or
maintaining and tracking housing production status.
Considerations
Implementation: Determine data needs that are
important for housing stakeholders, and strategies to
use the data to advance their work
Goals: Establish the audience and main purpose(s) of
the dashboard.
Definition Pros
• Potential Impact: Enhances transparency and
accountability by tracking and reporting on housing
targets and achievements.
• Primary Beneficiaries: Stakeholders, including
community members and policymakers, benefit from
accessible information on housing development progress. • Complexity: Streamlines the communication of complex
housing data, facilitating better-informed decision-making.
Cons
• Costs: Requires initial and ongoing investment for
platform development, maintenance, and data
management.
• Scale: Effectiveness can be limited by the quality and granularity of the data collected and presented.
• Timeline: May take time to establish accurate tracking systems and for users to adopt and integrate them into
their workflows.
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31 | HR&A Advisors
31 City of Anaheim Affordable Housing Program Options
Appendix
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32 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Expanding By-Right Housing Zones
(upzoning)
Under administrative approval for by-right development, local governments can approve projects meeting underlying local zoning requirements through administrative approval.
Allow Flexibility in Design,
Development and/or Zoning Allow flexibility in design and zoning codes to improve project feasibility.
Workforce (Moderate-Income)
Housing Incentive Programs
Workforce housing or moderate-income housing serves households making between 80% – 120% of area median income, depending on the jurisdiction.
Incentive Zoning (mandatory and
incentive-based)
Incentive zoning policies require and/or incentivize developers to include affordable homes as part of market rate developments, often in exchange for incentives such as density bonuses, tax abatement, fee reductions or waivers, or expedited review.
Affordable Accessory Dwelling Units
and JADUs Programs
Accessory Dwelling Units or Junior Accessory Dwelling Units are additional living quarters located on single-family lots, with the living spaces independent from the primary home.
Office, Hotel and Retail Conversion
Incentive Programs
Conversions of office, hotel, or retail spaces is a national trend to fill underutilized buildings and create much-needed housing opportunities.
Land Use and Regulatory Reform| Potential Techniques
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33 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Local Housing Trust Fund
Housing Trust Funds are a source of flexible local grant and loan funding that does not carry federal restrictions and can be used to support affordable housing activities determined by local priorities.
Housing Loan Fund Housing Loan Funds are a pool of private and public funding that can be loaned to affordable housing projects with firm repayment expectations.
Expanded Property Tax
Relief to Support
Moderate-Income Housing
Projects serving households earning less than 80% of AMI and owned by non-profits are already eligible for property tax relief associated with the Welfare Tax Exemption. Local governments can reduce, waive, or reimburse local property tax payments for specific mission-motivated building owners or builders.
Post-Redevelopment Tax
Increment Financing
Measures
Tax Increment Financing Measures are value capture revenue tools that use taxes on future gains of real estate values to pay for new investments. This may include EIFDs, AHAs, NIFTI 1 and 2.
Expand and Sustain Funding | Potential Techniques
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34 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Other Programs and Policies | Potential Techniques
Affordable Housing on
Public and Faith-based
Owned Land
Developing affordable housing on public or faith-based owned land involves the planning for the use, lease, or sale of land to support affordable housing.
Standardized Development
Agreement Strategy
Development agreements are legal agreements between developers and jurisdictions (sometimes community advocates are also involved) that provide development flexibility not typically achievable through zoning ordinances. They allow for alterations to the zoning requirements of a specific parcel of land, typically in exchange for public benefits.
Land Bank
Land banks, typically run by local governments or nonprofits to acquire, hold, manage, and redevelop property. Local governments can provide technical assistance or funding for the establishment or implementation of land banks.
Maintain Housing
Dashboard
A platform to provide up-to-date housing metrics and analysis to stakeholders, providing a way for local governments to communicate progress in achieving affordable housing goals.
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35 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Housing Techniques | Examples
Land Use and Regulatory Reform
Expanding By-Right Housing Zones
(upzoning) Santa Monica, City of Los Angeles, San Jose
Allow Flexibility in Design,
Development and/or Zoning
Santa Monica, City of Los Angeles, Numerous additional local and regional jurisdictions across CA.
Workforce (Moderate-Income)
Housing Incentive Programs Culver City
Incentive Zoning (mandatory and/or
incentive-based)
Santa Monica, Culver City, City and County of Los Angeles, Carlsbad, Palo Alto, Pasadena, San Clemente, Lake Forest, Cyprus, Brea
Affordable Accessory Dwelling Units
and JADUs Programs
Los Angeles, San Diego, San Jose Pre-Approved ADU Plan Program, Encinitas Permit- Ready ADU Program
Office, Hotel and Retail Conversion
Incentive Programs City of Los Angeles Adaptive Reuse Ordinance DRAFT
36 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Housing Techniques | Examples
Expand and Sustain Funding
Local Housing Trust Fund San Jose, Santa Monica, West Hollywood, San Diego, Pasadena Housing Loan Fund L.A. County Housing Innovation Fund, City of Los Angeles New General Fund
Commercial Linkage Fee Numerous local and regional jurisdictions across CA.
Expanded Property Tax Relief to Support Moderate-
Income Housing Southern California Association of Governments (in consideration) Post-Redevelopment Tax Increment Financing Measures City of West Sacramento Other Programs and Policies
Affordable Housing on Public and Faith-based Owned
Land
Montgomery County MD, City of Raleigh, City/County of Los Angeles
Standardized Development Agreement Strategy Santa Monica, West Hollywood, Los Angeles Land Bank Los Angeles
Maintain Housing Dashboard Jurisdictions in Maine, Michigan, Indiana DRAFT
37 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Appendix | Glossary of Key Terms
Naturally Occurring
Affordable Housing
(NOAH)
Raleigh Housing
Authority (RHA)
Subsidized
Area Median Income (AMI)
AMI represents the midpoint in the distribution
of household incomes within a certain
geographic region. HUD publishes annual AMI
levels for regions, adjusted for family size. The
HUD-provided AMI is used to determine
applicants’ eligibility for both federally and
locally funded housing programs where
participation is dependent on income levels.
Community Development Block Grant (CDBG)
The Community Development Block Grant
program, authorized by the federal government
in 1974, provides annual grants to participating
state and local jurisdictions, called “non-
entitlement” and “entitlement” communities,
respectively. HUD determines the amount of
each grant by using a formula comprised of
several measures of community need, including
the extent of poverty, population, housing
overcrowding, age of housing, and population
growth lag in relationship to other metropolitan
areas.
Cost-Burdened
A household is considered cost-burdened when
30% or more of their household income is spent
on gross housing costs (can apply to renters or
homeowners).
Housing Dashboard
A housing dashboard makes information about
housing needs and trends (by municipality,
metro area, or county) more widely accessible. It
provides a snapshot of a housing market,
demographics, jobs, and housing construction
data. It also enables users to quickly generate
reports to understand key issues (for instance,
across population, housing, and jobs) and
provide information to others.
Extremely Cost-Burdened
A household is considered extremely cost-
burdened households when 50% or more of
their household income is spent on housing
costs (can apply to renters or homeowners),
often leaving them with very little to cover
remaining household costs.
Low Income Housing Tax Credit (LIHTC)
The LIHTC Program is a federal program that
provides a dollar-for-dollar tax credit to support
the development of affordable rental housing.
The LIHTC program distributes federal income
tax credits to developers through state housing
finance agencies, which are responsible for
determining which projects receive tax credits
under the state’s allocation. There are two
general types of credits that can be awarded. 9%
LIHTC are higher-value credits that cover a
greater percentage of projects’ development
costs and are awarded on a competitive basis.
4% LITHC cover a lower percentage of projects’
development costs and are generally awarded to
any projects that meet specific programmatic
requirements and are financially feasible. 4%
credits are usually paired with tax-exempt bond
financing to make up the difference.
Mortgage Loan Pool
A mortgage loan pool allows participating
financial institutions and funders to jointly fund
a program that originates mortgages with
favorable terms to help low-income first-time
homeowners access homeownership. Such a
program both expands options and access for
these homeowners and helps to minimize risk to
banks who participate in offering
nonconforming mortgages, such as those with
lower down payment and other flexible
guidelines.
Naturally Occurring Affordable Housing
(NOAH)
Naturally occurring affordable housing is
housing that is priced by market forces at levels
that are affordable to low-income residents.
Housing is traditionally considered affordable if
the total housing cost (rent or mortgage plus
utilities) for the household represents no more
than 30% of its income. NOAH housing often
makes up a significant portion of a jurisdiction’s
affordable housing stock, in addition to publicly-
subsidized housing.
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38 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Appendix | Glossary of Key Terms
Naturally Occurring
Affordable Housing
(NOAH)
Raleigh Housing
Authority (RHA)
Subsidized
Public Housing
Public housing is a type of affordable housing
that has been traditionally owned by a local
government agency or authority. In most places,
this is a public housing authority. HUD provides
federal aid to local housing authorities to operate
housing for residents, who pay rents that they
can afford. In the United States today, there are
approximately 1.2 million households living in
public housing units, managed by some 3,300
housing authorities (HUD).
Public Land Disposition
Planning for the disposition of public land to
support affordable housing can take several
forms, including: identifying suitable sites for
affordable housing and making them available at
a subsidy to developers, and selling some sites
(including those not suitable for affordable
housing) at market price and using proceeds to
support other affordable housing efforts.
Public-Private Partnership
A collaboration between a government entity and
a private sector organization to jointly develop
and finance affordable housing projects. The
government often provides land, funding, tax
incentives, or other forms of support, while the
private sector partner can contribute financing,
expertise, and resources to design, build, and
manage the housing development.
DRAFT
39 | HR&A AdvisorsCity of Anaheim Affordable Housing Program Options Appendix | Area Median Income (AMI) in the City of Anaheim, 2023 Orange County AMI Level (2023)
AMI 30% 50% 60% 80% 100% 120%
1 Person 26,850 44,750 53,700 71,600 89,500 107,400
2 Person 30,660 51,100 61,320 81,760 102,200 122,640
3 Person 34,500 57,500 69,000 92,000 115,000 138,000
4 Person 38,340 63,900 76,680 102,240 127,800 153,360
5 Person 41,400 69,000 82,800 110,400 138,000 165,600
6 Person 44,460 74,100 88,920 118,560 148,200 177,840
7 Person 47,550 79,250 95,100 126,800 158,500 190,200
8 Person 50,610 84,350 101,220 134,960 168,700 202,440
Source(s): Novogradac Rent and Income Calculator, Orange County 2023, 1 Person +1 Based Calculation DRAFT
40 | HR&A Advisors
40 City of Anaheim Affordable Housing Program Options
February 15, 2024
Prepared for the City of Anaheim
Descriptions of Techniques to Increase
Housing Supply in the City of Anaheim