S.C. cities and counties soon could require developers to build affordable housing units into their residential projects.
A proposal giving local governments that authority moved forward in the S.C. Senate Wednesday, despite the objections of home builders and real estate agents who said the “forced charity” would be burdensome and ineffective.
The bill — sponsored by state Sen. Marlon Kimpson, D-Charleston — comes amid what activists and city officials say is an affordable housing crisis in South Carolina.
Priced out of the housing market by rising property values and rental rates, more than 80,000 low- to moderate-income South Carolinians need affordable housing, S.C. Community Loan Fund chief executive Michelle Mapp told the Senate panel Wednesday.
Kimpson’s bill would let cities and counties require developers to set aside up to 25 percent of the units within any future residential development to be priced as affordable housing. Developers could skirt that requirement by paying a fee.
Charleston Mayor John Tecklenburg and officials from Greenville and Beaufort told a Senate panel Wednesday that rising housing prices are forcing residents to live far from where they work. That, in turn, clogs commuter roads and exacerbates traffic problems, they said.
But home builders and real estate agents say the bill would cause more harm than good.
David Black, with the Home Builders Association of South Carolina, cited a 2004 study by a right-leaning think tank that found similar regulations in 45 cities led to a 31 percent dip in new construction.
Black asked what other industries are subject to “forced charity.” Car dealerships are not forced to offer low-income cars, and grocery stores are not required to donate to food banks, he said.
Lindsay Jackson, with the S.C. Association of Realtors, said the cost of offering housing at below-market prices would be passed on to consumers and landowners. “These policies can exacerbate the affordable housing problems they are designed to address.”
The real estate group is forming a task force to address the affordable housing shortage, Jackson said.
Affordable housing advocates said offering developers incentives to voluntarily build less expensive housing has not worked.
“It is important for this bill to have some teeth to it,” said Tracy Doran, president of the Lowcountry-based Humanities Foundation.
The bill is unlikely to pass this year after missing a crucial deadline to pass the full Senate. However, it could be taken up again next year.