The Kenney administration is looking to close a loophole
that allowed a Philadelphia developer to back out of a promise to include
affordable housing in the new One Water Street apartment complex and, instead,
make a $3.75 million payment to the city’s housing trust fund.
PMC Property Group, a Philadelphia firm founded by Ron
Caplan, received a 48-foot density bonus for One Water Street that allowed it
to construct five additional stories in exchange for including 25 affordable at
the project. Now nearly complete, the developer decided it would not include
those affordable units, instead opting to make the payment.
Controversial on many fronts, the switch by the developer
appeared as though the city was caving, allowing PMC to simply renege on the
deal and setting a precedent in which others could do the same in the future so
long as they paid up.
Mayor Jim Kenney said in an interview Thursday on WHYY’s
Radio Times that the deal struck with PMC was a “reasonable solution” since it
looked as if the city wasn’t on very strong legal footing to force the
developer to incorporate the affordable housing into One Water Street.
“Our code was insufficient to keep that from happening.
That is going to be corrected,” Kenney said on Radio Times. “We had some
question whether we could win that in court.”
A provision in the zoning code allows developers to get a
height or floor-area bonus and, in exchange, can include affordable units in a
project, incorporate public art or retail into it or contribute to the
Philadelphia Housing Trust Fund.
"If any developer in the future decides that they
are going to offer or pledge moderate-income housing in their development, they
will not be able to get other points to get out of that deal. This was one and
done and we’re going to fix that situation going forward," Kenney said.
“The code doesn’t care what you do,” added Karen Guss,
spokeswoman for the Philadelphia Department of Licenses & Inspections. “The
code doesn’t care if you do affordable housing units or pay into the fund. It
considers both of these as providing for affordable housing.”
Regardless the Philadelphia Association of Community
Development Corporations was pleased with the outcome and cited it as an
example of Kenney “holding a developer accountable to the zoning code, but also
to equitable development in the interest of low- and moderate-income
Philadelphians for whom the mixed-income housing density bonus was created.”
The $3.75 million PMC paid to the Philadelphia Housing
Trust Fund will go toward constructing affordable housing.
Lauren Hitt, a spokeswoman for the mayor, said in an
email on Friday confirmed Kenney wants to close the loophole, but exactly how
that will be accomplished isn’t known at this time.
“We’re exploring a couple of different options,” Hitt
said.
Source: Philadelphia
Business Journal
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