2025 -- H 6175
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LC002664
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S T A T E O F R H O D E I S L A N D
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2025
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A N A C T
RELATING TO TOWNS AN D CITIES -- ZONING ORDINANCES
Introduced By: Representative June Speakman
Date Introduced: April 04, 2025
Referred To: House Municipal Government & Housing
It is enacted by the General Assembly as follows:
SECTION 1. Section 45-24-46.1 of the General Laws in Chapter 45-24 entitled "Zoning 1
Ordinances" is hereby amended to read as follows: 2
45-24-46.1. Inclusionary zoning. [Effective January 1, 2025.] 3
(a) A zoning ordinance requiring the inclusion of affordable housing as part of a 4
development shall provide that the housing will be affordable housing, as defined in § 42-128-5
8.1(d)(1); that the affordable housing will be of comparable size and quality to the market-rate 6
housing; that the affordable housing will constitute not less than fifteen percent (15%) of the total 7
units proposed for the development; and that the units will remain affordable for a period of not 8
less than thirty (30) years from initial occupancy enforced through a land lease and/or deed 9
restriction enforceable by the municipality and the state of Rhode Island. A zoning ordinance that 10
requires the inclusion of affordable housing as part of a development shall specify the threshold in 11
which the inclusion of affordable housing is required, but in no event shall a minimum threshold 12
triggering the inclusion of affordable housing be higher than ten (10) dwelling units. The total 13
number of units for the development may include less than fifteen percent (15%) affordable units 14
after the density bonus described in subsection (c) of this section is determined. 15
(b) A zoning ordinance that includes inclusionary zoning may provide that the affordable 16
housing must be built on-site or it may allow for one or more alternative methods of production, 17
including, but not limited to: off-site construction or rehabilitation; donation of land suitable for 18
development of the required affordable units; and/or the payment of a fee in lieu of the construction 19
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or provision of affordable housing units. 1
(c) Density bonus, zoning incentives, and municipal subsidies. For all projects subject 2
to inclusionary zoning, subject to applicable setback, lot width, or frontage requirements or the 3
granting of relief from the same, a municipality shall allow the addition of one market rate unit for 4
each affordable unit required and the minimum lot area per dwelling unit normally required in the 5
applicable zoning district shall be reduced by that amount necessary to accommodate the 6
development. Larger density bonuses for the provision of an increased percentage of affordable 7
housing in a development may be provided by a municipality in the zoning ordinance. The total 8
number of units for the development shall equal the number originally proposed, including the 9
required affordable units, plus the additional units that constitute the density bonus. Local 10
regulations shall provide for reasonable relief from dimensional requirements to accommodate the 11
bonus density under this section. A municipality shall provide, and an applicant may request, 12
additional zoning incentives and/or municipal government subsidies as defined in § 45-53-3 to 13
offset differential costs of affordable units. Available zoning incentives and municipal government 14
subsidies may be listed in the zoning ordinance, but shall not be an exclusive list. 15
(d) Fee-in-lieu. To the extent a municipality provides an option for the payment of a fee-16
in-lieu of the construction or provision of affordable housing, and an application seeks to utilize 17
fee-in-lieu, the use of such fee shall be the choice of the developer or builder applied on a per-unit 18
basis and may be used for new developments, purchasing property and/or homes, rehabilitating 19
properties, or any other manner that creates additional low- or moderate-income housing as defined 20
in § 45-53-3(9). Notwithstanding anything to the contrary in this section, when the size of a 21
development triggers a requirement in a zoning ordinance for one or more affordable housing units, 22
the unit(s) shall be created. Payment of a fee in lieu of the construction or provision of affordable 23
housing units is permissible only to pay for fractions of units (i.e. when only a fraction of one full 24
unit is required or for fractions of units beyond one or more full units). 25
(1) Eligibility for density bonus. Notwithstanding any other provisions of this chapter, an 26
application that utilizes a fee-in-lieu, off-site construction or rehabilitation, or donation of land 27
suitable for development of the required affordable units shall not be eligible for the density bonus 28
outlined in this section. 29
(2) An application that seeks to utilize a fee-in-lieu of the construction or provision of 30
affordable housing must be reviewed by the planning board or commission and is not eligible for 31
administrative review under the Rhode Island Land Development and Subdivision Review 32
Enabling Act of 1992, codified at §§ 45-23-25 — 45-23-74. 33
(3) Amount of fee-in-lieu. For affordable single-family homes and condominium units, the 34
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per-unit fee shall be the difference between the maximum affordable sales price for a family of four 1
(4) earning eighty percent (80%) of the area median income as determined annually by the U.S. 2
Department of Housing and Urban Development and the average cost of developing a single unit 3
of affordable housing. The average cost of developing a single unit of affordable housing shall be 4
determined annually based on the average, per-unit development cost of affordable homes financed 5
by Rhode Island housing and mortgage finance corporation (RIHMFC) over the previous three (3) 6
years, excluding existing units that received preservation financing. In order to pay for a fraction 7
of an affordable single-family home or condominium unit, the fraction will be multiplied by the 8
per-unit fee for the development. The per-unit fee shall be the difference between the maximum 9
affordable sales price for a family of four (4) earning eighty percent (80%) of the area median 10
income as determined annually by the U.S. Department of Housing and Urban Development and 11
the average cost of developing a single unit of affordable housing. The average cost of developing 12
a single unit of affordable housing shall be determined annually based on the average, per-unit 13
development cost of affordable homes financed by Rhode Island housing over the previous three 14
(3) years, excluding units that received preservation financing. 15
(i) Notwithstanding subsection (d)(3) of this section, in no case shall the per-unit fee for 16
affordable single family homes and condominium units be less than forty thousand dollars 17
($40,000). 18
(4) Use of fee-in-lieu. The municipality shall deposit all in-lieu payments into restricted 19
accounts that shall be allocated and spent only for the creation and development of affordable 20
housing within the municipality serving individuals or families at or below eighty percent (80%) 21
of the area median income. The municipality shall maintain a local affordable housing board to 22
oversee the funds in the restricted accounts and shall allocate the funds within three (3) years of 23
collection. The municipality shall include in the housing element of their local comprehensive plan 24
and shall pass by ordinance, the process it will use to allocate the funds. 25
(e) As an alternative to the provisions of subsection (d), the municipality may elect to 26
transfer in-lieu payments promptly upon receipt or within the three-year (3) period after receipt. A 27
municipality shall transfer all fee-in-lieu payments that are not allocated within three (3) years of 28
collection, including funds held as of July 1, 2024, to RIHMFC for the purpose of developing 29
affordable housing within that community. 30
(f) Both the municipalities and RIHMFC shall report annually with the first report due 31
December 31, 2024, to the general assembly, the secretary of housing, and the housing resources 32
commission the amount of fees in lieu collected by community, the projects that were provided 33
funding with the fees, the dollar amounts allocated to the projects, and the number of units created. 34
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SECTION 2. This act shall take effect upon passage. 1
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO TOWNS AN D CITIES -- ZONING ORDINANCES
***
This act would require that the inclusion of affordable housing as part of a development 1
shall provide that the affordable housing will be of comparable size and quality to the market rate 2
housing. If there is a requirement for one or more affordable housing units triggered by the size of 3
a development, the units shall be created. The average cost of developing a single unit of affordable 4
housing would be determined annually based on the average, per unit development cost of 5
affordable homes financed by Rhode Island housing over the previous three (3) years. 6
This act would take effect upon passage. 7
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