Inclusionary zoning (IZ) is a market-based, land-use housing policy that enables lower and moderate-income households to live in new, private developments in middle- or upper-income communities. IZ policies encourage real estate developers to include units that are sold or rented at below-market prices into market-rate developments in exchange for incentives designed to offset the costs. By integrating affordable units into market-rate projects, IZ creates opportunities for households from diverse socioeconomic backgrounds to live in the same communities and allows people of all incomes to have access to the same amenities, services, and opportunities, such as good jobs, good schools, transportation, and healthy living environments. More inclusive, mixed-income communities reduce concentrated poverty in other areas by giving low- and middle-income families and residents more opportunities to live in low-poverty neighborhoods and communities. Reducing concentrated poverty benefits the entire community by reducing crime rates, dropout rates, and teenage pregnancies, and increasing educational outcomes, economic opportunities, and public health outcomes. Additionally, reducing concentrated poverty through the expansion of mixed-income communities can open more neighborhoods to market-rate development opportunities. Ensuring that everyone has access to high-quality housing is more than just a numbers game: place matters.

Inclusionary Zoning programs vary widely in their structure. They are preferable to traditional one-size-fits all affordable housing programs because they can be customized and flexible to adapt to each community’s unique housing market and needs. Mandatory ordinances require any new development over a predetermined threshold of units to “set aside” a certain percentage of units as affordable, or pay an “in-lieu-of” fee into a local housing trust or program. Voluntary programs are sometimes seen as more feasible politically, but produce far fewer affordable units and must offer substantial subsidies to the developer. Both mandatory and voluntary programs have different set-aside requirements, affordability levels, and control periods, and offer developers incentives to offset costs, such as density bonuses, expedited permit approval, reduced parking requirements, and fee waivers. Inclusionary Zoning is a local policy tool, and should not be mandated, implemented, or prohibited at the state level. Local communities deserve to have local control and decide which tools are necessary to address local housing markets, housing needs, fiscal and economic realities, and political priorities.