WHEN IT WAS adopted in the 1970s, Montgomery County's program to ensure a reasonable supply of affordable housing was a national model, hailed as both pragmatic and progressive. It required developers to set aside 12.5 percent of new apartments, townhouses or houses for households with low or moderate incomes; in return, the county granted developers concessions to help make their projects profitable. The program produced scores of imitators and worked so well that from 1973 to 2002, the county generated more than 11,000 affordable houses, condos and apartments -- over a quarter of all those produced by the scores of so-called "inclusionary zoning" schemes that sprang up around the country.
But the factors that helped make the program a success three decades ago -- plentiful open land and reasonable real estate prices -- no longer pertain. The stock of below-market-value units occupied by eligible buyers and renters has dwindled as price controls lapsed and price-controlled dwellings reverted to the open market. Today just 3,000 families -- less than 1 percent of county households -- live in affordable units created by the program, down from 6,300 during the construction heyday in the 1980s.
The market is the primary catalyst here, but that doesn't mean the county should throw up its hands. There is a crushing demand for affordable dwellings in Montgomery, and not just for the indigent; families of four with incomes of $50,000 have been all but shut out of the county by soaring housing prices. Last winter, when a team of officials was commissioned by the County Council to study the problem, there were nine times as many people on the waiting list for affordable housing as there were houses and apartments available.
One problem is that under rules set by the county, price controls have lapsed too quickly; houses can be resold at market rates after just 10 years. The county has also gotten into the self-defeating habit of allowing developers to buy their way out of the program by making negotiated (and often modest) payments into a public housing fund rather than providing houses or apartments at below-market rates. That should stop.
As the council's study acknowledged, however, the program's success has always depended on striking a balance between requiring affordable housing and giving developers the opportunity to realize a decent profit. Under current market conditions, that may mean providing additional incentives for developers. Five council members have proposed allowing developers to add a floor or two to new apartment buildings as inducement for them to provide affordable units. That comes at a price -- namely, traffic -- but may make sense for carefully selected buildings in downtown cores and adjacent to Metro stations, such as Bethesda or Wheaton. A longer menu of possible tweaks to the affordable housing program will be weighed by the council, and the merits of each can be debated. What's certain is that promoting affordable housing is urgent in a place that prizes diversity and relies on a growing workforce.