Tempe Council describes new development bonus program for affordable housing

Tempe City Council has taken a significant step towards addressing affordable housing in the community by advancing a new development bonus program during their joint meeting on May 19, 2025. This initiative aims to incentivize developers to include affordable housing units in their projects, aligning with the city’s long-term general plan.

The program allows developers to gain additional density and height in their projects in exchange for committing to a percentage of affordable units. Specifically, developers can achieve up to 30% of their units as affordable housing, with requirements based on area median income (AMI) levels. For instance, if a project allows for 25 additional units, developers would need to ensure that a portion of these units meets affordability criteria, which could range from 25% to 75% of the total units based on income levels.

Councilor Burrage raised an important question regarding the inclusion of HUD renters and voucher systems in this program. The response confirmed that developers could incorporate these forms of affordable housing, highlighting the program's flexibility to cater to various community needs.

The city has identified over 7,154 properties across more than 1,400 acres that are eligible for this program, indicating a broad opportunity for affordable housing development throughout Tempe. The zoning districts involved range from lower density areas allowing 10 units per acre to higher density zones that can accommodate up to 25 units per acre.

To ensure compliance and maintain affordability, the program will require developers to sign a covenant with the city, guaranteeing affordability for a period of 30 years. This will be monitored through annual self-reporting and audits, ensuring that the commitments made by developers are upheld.

In addition to the development bonus program, the council discussed potential zoning changes to facilitate affordable housing, including the introduction of a new zoning district that would allow for higher density developments.

This initiative marks a proactive approach by the Tempe City Council to tackle the pressing issue of affordable housing, aiming to create a more inclusive community while also supporting sustainable development practices. As the program moves forward, it is expected to play a crucial role in shaping the future of housing in Tempe.