By Glenn Rolfe

GEORGETOWN — Sussex County leaders are pursuing an express lane for development committed to economical housing for the area’s workforce.

The goal — which would require approval of a new ordinance — is to incentivize development of housing with a percentage earmarked for workforce-level rental scales in the Coastal, Developing and Town Center growth areas of the county.

“(What) we are looking to do is create a new permitted use for workforce housing,” said County Assistant Attorney Vince Robertson at an Oct. 26 presentation to County Council. “What that means, and what’s important for you to understand, is that if it’s a permitted use, that means it’s permitted. There is no public hearing for each application. It doesn’t go to Planning & Zoning for public hearing. It doesn’t come to County Council for public hearing. It’s permitted. It’s allowed. They (only) come in for site plan review.”

The maximum density proposed for this permitted use would be up to 12 units per acre. Of the total units that are proposed for a participating development, 30% must be set aside for workforce housing.

“Of those 30%, they will be targeted to 80% of the area median index,” explained Brandi Nauman, Sussex County’s housing coordinator and fair housing compliance officer.

While rent would be substantially less for workforce housing units, the trade-off for developers would be density and fast-track buildouts, with no hearings required at the Planning & Zoning Commission or County Council levels.

“Do you think that these changes will be enough of an incentive that the private sector is going to say, ‘This is the way to go’?” asked County Councilman John Rieley.

County Administrator Todd Lawson replied, “Everyone that developed these recommendations that you heard from … based it on a housing expert, a housing consultant that said, ‘Here is what you should consider.’ One of the considerations is exactly what we put forward. This is market-based, incentive-based. Being able to come in and have clarity on what they can build and where they can build, it seems to be something that housing experts will tell you will drive this in that direction.

Mr. Lawson said he expects the initiative to be beneficial.

“They are building these types of homes today. They are just at market rates. We’re trying to build an incentive that would allow them to come in under an AMI rate that would allow a workforce to live where they work.”

When asked if the incentive was enough, he continued, “We built this recommendation on local developer feedback. I would suggest if we move to the next step, which potentially would be going to an ordinance level, we’re going (to) hear if this would incentivize or not.”

County Council President Michael Vincent said the density factor would be a big help.

“I (also) would think that a big help is being able to walk back there and get a permit and not coming to public hearings,” he said.

The workforce program is not geared toward minimum-wage workers but a general workforce, such as nurses, health care workers, police officers, teachers and similar-wage earners.

Seeds for this initiative were planted in the 2018 comprehensive land-use plan, which led to analyses on housing needs by LSA, which was contracted by the county.

Councilman Mark Schaeffer asked what these units would rent for.

As an example, Ms. Nauman offered data for Coastal Tide Apartments, at present the only affordable-housing project in the Sussex County Rental Program: Rent for a one-bedroom unit is $595 at Coastal Tide, compared to the equivalent market rate of $1,525. Two-bedroom units run $715 (compared to $1,725), and three bedrooms are rented for $825 (compared to $1,995).

“That is specific to Coastal Tide,” said Ms. Nauman. “(Rent rates) would be very similar going forward with this proposed initiative. I just wanted that to be a frame of reference. So the Sussex County Rental Program will sort of govern that Coastal Tide project, but any new projects that would be producing affordable-rental units would be under the parameters of the proposal that was given on Oct. 26.”

Currently in the county, 80% of AMI for a household of four is about $60,100. For a two-person household, it’s $48,100, and for one person, it’s $42,100, said Ms. Nauman. She noted that AMI is updated annually by the U.S. Department of Housing and Urban Development and that these figures are “specific to Sussex County.”

If this proposal is approved, applicants’ data from the property management company would be sent to Ms. Nauman’s office and subsequently audited to make sure all requirements are met.

“For noncompliance, we are proposing financial penalties, which would be deposited to our Sussex County Housing Trust Fund,” she said. She added that no public money is involved.
A good portion of eastern Sussex is designated as Coastal Area. Additionally, the bulk of municipalities in the county would have workforce housing options through the Development Area and Town Center designations.

Workforce housing buildings can be four stories and no taller than 52 feet.

Mr. Robertson noted that LSA planners have suggested a higher density than is customary in Sussex County.

“But one of the things that everybody agrees (on is) … what makes it workable is that you have to have enough density to make the workforce housing units economically viable,” he said. “If you’re going to have affordable rents within those units, you have to have significant market rate density to make that project economically work.”

Councilwoman Cindy Green reminded her colleagues that workforce housing is not a substitute for affordable housing, which is a separate county program.

“We have been talking about this workforce housing, and it seems to be moving in a positive (direction). It doesn’t make the affordable housing go away,” she said. “I just want to make sure we are not avoiding the affordable housing at the same time.”

What’s next?

The next step would be development of an ordinance.

Mr. Lawson suggested that, given the approaching holiday season and limited number of meetings remaining in 2021, council’s options would be to hold off until next year or to begin ordinance development now.

Councilman Vincent recommended that the county team start drawing “the ordinance up and bring it to us.”