CityLab Takes a Look Inside Jersey City’s Affordable Housing Plan

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The Atlantic’s CityLab takes a deep look at Jersey City’s affordable housing plan, which in a nutshell uses clever tax incentives to steer mixed-income development in all of Jersey City’s neighborhoods.

“Where many urban areas in the country have affordable housing condensed into one area and market rate elsewhere, we think a healthy city has both market rate and affordable touching every corner of the city,” Mayor Steven Fulop tells CityLab.

So how does this all work? For starters, the city is broken down into zones. Tiers 1 and 2 cover neighborhoods that are very developed (such as the waterfront/Grove area). To build here, builders have shorter-term property tax abatements. (Tax abatements are exemptions or subsidies that reduce the cost of construction). Meanwhile, tiers 3 and 4 cover neighborhoods where the city wants to lure developers (such as Journal Square). To get developers to build here, the city offers longer-term abatements. Each tier — regardless of neighborhood — requires builders to construct or fund some affordable housing in the city.

“What makes the Jersey City plan innovative … is that it varies the level of the tax incentives for development based on the market characteristics of the neighborhood,” Alan Berube, senior fellow and deputy director of the Brookings Institution’s Metropolitan Policy Program tells CityLab via email. “Too often cities fail to use these incentives strategically, or they spread them around like peanut butter.” —CityLab

(Provost Square image via SLCE Architects)