Madison’s Inclusionary Zoning Program is an accomplishment claimed by the Cieslewicz administration. The plan to mandate ‘affordable housing units’ in new construction is adopted in January 2004. The Developer Guidelines (pdf) outline nines steps, each with a controlling city department, required to build housing units in town. Two years later, developer Terrance Wall reviews building permits and concludes Mayor Dave and the socialist kids achieve the complete opposite of what they desired.
How Inclusionary Zoning backfired on Madison: Inclusionary Zoning, Madison’s well-meaning program to increase the supply of affordable housing, has had a starkly perverse impact on the local housing market: Vacancy rates have declined and rental rates have increased, producing exactly the opposite effect that IZ advocates wanted.
Why? Because IZ has scared away apartment developers from Madison. … In the pre-IZ period of 2001 to 2003, developers built 3,257 housing units (of all types) in Madison, compared to only 1,954 units from 2004 to 2006. That’s a 40% decrease in the IZ era.
Only two market-rate rental buildings with IZ units have been built, and both were for student housing. The other new apartment buildings have either been exempted from the IZ requirements or paid a fee in lieu of providing affordable units. Think about that: No non-student, market-rate apartment projects with affordable IZ units were built from 2004 to 2006.
Madison’s Inclusionary Zoning ordinance has, in the end, proved to be little more than a political charade that has not only failed to accomplish its objective, but has worsened the local housing market. It is a do-gooder mandate gone bad.
