Instead of forcing reluctant builders to sprinkle moderate-income houses among high-priced units, Howard County officials are considering allowing them to be built in other locations, or in alternate forms - if the county can get more affordable units from the deal.
County planning director Marsha L. McLaughlin said getting land where middle-income homes could be built, or letting a builder provide two or three condominium apartments instead of one house, could help more people afford a home, while satisfying builders' complaints. If those or similar ideas are adopted, they would likely require changes in county law, however.
"I think eventually where we're heading is some legislation," she said.
McLaughlin and county housing director Leonard S. Vaughan said builders are working behind the scenes to find ways to fulfill their legal obligation to build affordable housing without including the units in expensive developments. Zoning laws grant builders the right to build more homes in return for providing lots for moderate-income homes in mixed-use, high-density and planned senior communities.
"[Developers are] leaning on Leonard and on us," McLaughlin said. "If they had their choice, they'd rather write Leonard a check. We're struggling for ways to give them flexibility," while still achieving the county's housing goals.
The county doesn't want just cash, she said, because money without buildable land won't help, and developers are better at finding land than the county.
Vaughan said that quality, slightly smaller, no-frills homes are what the county wants, instead of oversized units loaded with expensive features and options. With land, the county could develop a larger middle-income community, leaving the builders to reap what he called "significant profits" from their upscale projects in the red-hot real estate market.
A planned 25-unit apartment building for low-income seniors on county-owned land in Ellicott City could be an example of the kind of exchange under discussion.
Developer Paul Revelle's firm, called Revellopment, and builder Dale Thompson agreed to build the Tiber-Hudson apartments on Mount Ida Drive at cost, and they are contributing $1.2 million toward the construction. A groundbreaking is scheduled for Jan. 25.
In exchange, they'll be freed from their obligation to build 14 moderate-income units at their upscale Scott's Glen senior housing complex across Cedar Lane from the Hickory Ridge Village Center in Columbia. Revelle said homeowners association fees of up to $300 a month at Scott's Glen would place a large burden on moderate-income buyers, and perhaps create a legal burden for the developers.
"We think it avoided the problem of a condominium association with two types of owners fees. It could be a legal problem," Revelle said.
Vaughan said the sharply higher home prices are shutting more middle-income families out of the market, and are also putting a growing strain on the county's already small moderate-income home program.
The county defines a moderate-income house as priced at no more than $189,500 for buyers with incomes under $54,900. Howard's average home price in 2004 was $367,000 and new homes routinely sell for more than $500,000.
Still, builders are complaining they are losing money putting lower-priced homes amid much more expensive, but identical units, while high homeowner association fees and property taxes burden the middle-income buyers.
The issue was the central topic at a meeting of the county's Housing Commission and Housing and Community Development board last week. Members talked about other options, too - such as building apartments or townhouses as part of office or commercial developments, or getting builders to help with school construction.
"We need some really innovative thinking here to solve these challenges," said housing board member Michael G. Reimer, who also urged involving the County Council members in the discussions.
"We need to encourage them to look at the problem from our side, too," he said.
Thomas Ballentine, a lobbyist for the Homebuilders Association of Maryland, said moderate-income housing programs may seem helpful, but "in the long run those kind of programs are damaging to housing consumers. Price controls on a portion of housing stock force market-rate buyers to buy at higher prices."
But Vaughan told the board and commission members that higher home prices are driven by the hot market, not by higher costs.
McLaughlin said the county's "dialogue with the development community" will continue through the winter.