PEABODY — The City Council has stricken a provision from Peabody's zoning regulations that allowed developers to pay a lump sum of money to the city in lieu of including below-market-rate housing in their condominium or apartment developments.
The inclusionary zoning buyout option was intended to give flexibility to developers and the city, which could use payments to fund affordable housing programs or directly develop housing for low-income residents. But City Council President Arthur Athas highlighted its limited impact during a meeting last week.
"We have actually nothing to show for it," he said.
Since 2002, the council has approved two buyouts, one for the 446-apartment community on Dearborn Road, and one for a development near downtown called Riverwalk Place. The latter complex was never developed and all permits for the project have expired. The city received more than $1 million from a development known now as the Highlands at Dearborn.
With roughly half of that money, Peabody has launched a low-interest loan program to encourage the redevelopment of three abandoned properties on Park Street. If successful, it will add four units to the city's affordable housing stock.
Councilors didn't see that as an adequate return, considering the Dearborn Road development would have provided 67 lower-income units if the buyout option wasn't utilized.
Affordable housing is a pressing concern in Peabody. Councilor Jim Liacos pointed out that the city's affordable housing stock is expected to fall below 10 percent after the 2010 census. Now, with 10.4 percent of its housing stock considered affordable in the eyes of the state, Peabody has more leeway to reject or control so-called 40B development. The 40B refers to a state law that allows a developer to skirt most local zoning rules if a portion of a development is set aside for affordable homes.
Peabody's Community Development office opposed doing away with the buyout option. Removing it "could act as a deterrent to developers, financiers and others in the future and hold back quality projects from being done in Peabody," planner Nate Jones wrote in a memo to the council.
Councilor Rico Mello said he could see the advantage the buyout gives developers but not the benefit it offered the city.
The vote was 8-2, with Dave Gamache and Barry Osborne objecting. Getting something was better than nothing, they both said. "We might as well take the money," Osborne said.
Mayor Michael Bonfanti could veto the change. He said yesterday that he was still contemplating his response.
"(The inclusionary zoning buyout) is still a worthy concept; on the other hand, it hasn't worked as well as we would have liked," Bonfanti said.
He said he would have preferred the council to study the issue more in committee before voting.
