The incentive for the University Marketplace project is on the City Council’s agenda for its meeting Tuesday night. Previous discussions raised questions for which council members wanted answers before voting on it.

University Marketplace is a 340,000-square foot mixed-use project that Hawthorne Retail Partners of Charlotte plans to build on the former Regency Plaza site near South Square. The project would include 330 residential apartments, 15 percent of which would be “affordable” for households with incomes below the area median.

More low-cost housing, particularly outside the inner city and particularly near planned future transit stops, is a priority for the city government. University Marketplace serves all three goals.

However, when the University Marketplace incentive came up at a City Council work session last month, council members wondered just what “affordable” means, and how to pay the difference between what qualifies as affordable and the housing Durham really needs.

Consultant’s report

City council members had been “sensitized” – as Councilman Steve Schewel put it – to low-cost housing by a consultant’s report that found Durham has too little truly low-cost housing and needs to provide it beyond the inner city.

Hawthorne proposes to make 15 percent of its units “affordable” – meaning renting for no more than 30 percent of the gross income for a household having incomes less than 80 percent of the area median.

According to the U.S. Department of Housing and Urban Development, Durham’s AMI is $68,700 for a family of four. Eighty percent of that is $54,950 (see bit.ly/RqHwFc), so the family’s affordable rent would be $1,374 per month.

“That doesn’t seem that affordable,” Schewel said during the work session.

Federal standards

Three days before that session, council members heard a consultant’s report that a lack of housing at 50 percent AMI – $859 a month for a four-person household – and a concentration of minority residents in the inner city are impeding Durham’s meeting federal Fair Housing standards.

The report, “Analysis of Impediments To Fair Housing Choice For the City of Durham,” is required by HUD every five years. The 2012 report included eight “impediments,” and immediately begged the question of what the city is going to do about them. University Marketplace re-started the conversation.

One idea is for the Durham Housing Authority to cover the difference between affordable rent at 50 percent and 80 percent, which would not affect the developer’s income. Bell has another idea, too.

“I’m not so sure the developer couldn’t do it,” he said. “Take a little less? I don’t think that level of conversation has gone on enough, especially for a developer coming in asking for an incentive.

“You ought to take that extra step.”

Questions remaining, a public hearing on $1 million for University Marketplace remains on Tuesday’s agenda.

“We’ll still have it,” said City Manager Tom Bonfield, “then decide what to do when we get there.”