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Kansas City Will Limit Tax Breaks To Housing Developers Who Don't Include A Few $500 Units

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Carlos Moreno/KCUR 89.3
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In 2018, Cordish Company agreed to build 100 affordable units in the Midland Building at 13th and Baltimore in exchange for subsidies on the parking garage for its luxury Three Light high-rise.

The Kansas City Council approved a measure Thursday that some consider to be the first minimal step toward addressing the city’s affordable housing crisis.

The Kansas City Council voted 12-0 Thursday to require residential developers seeking economic incentives to provide a minimal number of affordable units.

Mayor Quinton Lucas, who co-sponsored the measure with Councilwoman Melissa Robinson, praised advocates who have argued passionately for several years that Kansas City needs to do more to address a severe affordable housing shortage.
“It is time to vote,” Lucas said. “It is time to commit for this city to progress on affordable housing.”

The ordinance requires that multi-family projects seeking tax incentives should set aside at least 10% of those units for residents earning 70% or less of the area median income, with monthly rents $1,000 or less, and 10% for those earning 30% or less of area median income, about $500 to $700 per month depending on family income and apartment size.

Developers who can’t achieve that housing set-aside would make a payment of 110% of the construction cost of those units to the city’s Housing Trust Fund.

The measure was modified Thursday to exempt historic restoration projects and projects receiving state or federal low-income housing tax credits.

The law’s effective date is also delayed 60 days, to March 29, so the council can explore alternative ways of providing the extremely affordable units in the form of funding, vouchers and other means and so stakeholders can keep working on that challenge.

“This is very significant,” said Councilwoman Andrea Bough. But she added it’s not the end, and additional policy steps will be needed.

“We have a lot of work to do moving forward and we will commit to continue that work,” she said. “The goal here is to ensure that affordable housing is built.”

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Carlos Moreno/KCUR 89.3
Workers attach a beam to the framework of apartments being constructed at Berkley Riverfront. The construction is part of a Port KC program that requires projects include a minimum of 15 percent of units designated as affordable at 70 percent of area median income.

Councilwoman Katheryn Shields said recent discussions have highlighted the need for a more robust voucher program to help needy residents afford their rents.

“That’s part of the work that will be done in the next 60 days,” she said, “is actually perfecting a program that allows for that kind of assistance to be available to our most vulnerable city residents.”

The affordable housing debate reached a fever pitch in 2018, when Kansas City agreed to subsidize the luxury Three Light apartment project downtown, where rents were slated to be about $1,600 per month.

The City Council subsequently adopted an ordinance defining “affordable” as about $1,100 per month.

Many people felt that definition of more than $1,000 per month was still too high, especially for families making less than $45,000 per year.

The council’s affordable housing vote tees up another debate over broader incentives provided for developers. A proposed reform measure that further caps tax abatements and limits the timeframe is slated for a council committee debate in early February, but it would exempt affordable housing projects.

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