San Diego City Hall. Photo by Chris Stone

The San Diego City Council approved a plan Tuesday that provides incentives for builders to create more housing for low- and moderate-income residents.

Proposed by Mayor Kevin Faulconer as part of the “Housing SD” plan, the Moderate-Income Housing Density Bonus won unanimous approval from council members.

“The need for more housing that hardworking San Diegans and their families can afford is abundantly clear,” Faulconer said. “As we continue to implement reforms, we’re making it easier to build and incentivizing the production of housing for those with low or moderate income. This new program will spur more housing for working San Diegans who want to live near transit and job centers.”

The new bonus is intended to be used in tandem with the Affordable Housing Density Bonus program, which the council approved in 2016.

The way it works is that once a project maximizes the existing affordable housing density bonus of 50%, it can then use the new moderate-income program to obtain an additional 25% density bonus as long as 10% of pre-density units are deed-restricted at 120% area median income (AMI) or lower.

 Moderate income is defined as 81-120% of AMI. Low income is defined as 51-80% of AMI. The median income for San Diego is $92,700.

The city’s Regional Housing Needs Assessment called for 15,462 housing units to be built from 2010 to 2020 reserved for moderate-income households, but only 34 had been constructed through 2019. The moderate-income program establishes various incentives for those types of projects that exceed the city’s affordable housing requirements and agree to construct more affordable homes.

— Staff report

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