HDIP CITY COUNCIL PRESENTATION - FEBRUARY 15, 2017Proposed Housing Development Incentive Program
(HDIP) Zone and Plan for Downtown Salem
Salem City Council Public Hearing:
Subcommittee on Community & Economic Development
Co-Posted with Committee of the Whole
February 15, 2017
Tom Daniel, AICP, Director of Planning & Community Development
Andrew Shapiro, AICP, Economic Development Planner
Overview
1.What is HDIP?
2.How does HDIP incent
market rate housing?
3.HDIP approval process
4.Proposed HD Zone
5.Why should the City
adopt an HDIP Plan and
Zone?
6.Questions / Comments
What is HDIP?
•Established in 2012 by the Commonwealth of
Massachusetts
•Intent: increase residential growth, expand diversity of
housing stock, support economic development, and
promote neighborhood stabilization in designated
areas in Gateway Cities
•Focus: creation of multi-unit market rate housing
How Does HDIP Incent Market Rate Housing?
The program provides two types of incentives:
1.Local Tax Increment Exemption (TIE) Agreement
- Comparable to a TIF
- Base property tax is paid in full; portion of the
resultant post-development increase is exempted
2.State Tax Credit for “Qualified Substantial Rehabilitation
Expenditures (QSREs)”
- Max award: 10% of QSREs; capped at $2M
HDIP Approval Process
Set HD Zone
boundaries and
approve Plan
City applies for
and receives
DHCD approval
Developers can
apply to certify
housing projects
within HD Zone
Execute TIE Agreement
Preliminary Certification
Conditional Certification
Tax credits allocated
Final Certification
Proposed Downtown Salem HD Zone
HD Zone Boundary Delineation:
Why should the City adopt an HDIP Zone and Plan?
To undertake activities and initiatives to
accomplish public or private
redevelopment of vacant or underutilized
land and buildings, public open space and
the infrastructure of streets, sidewalks and
utilities consistent with the other purposes
within this Salem Downtown Renewal Plan.
-“Plan Objectives,” Page E-7, Salem
Downtown Renewal Plan, 2011
Why should the City adopt an HDIP Zone and Plan?
•Population to increase by 1,500 to 3,700
people
•Number of households to increase by 10 to
14%
•Average household size to decrease to 2.2
•Salem will need to produce between 1,900
and 2,700 multi-family housing units in order
to keep pace with future demand
Why should the City adopt an HDIP Zone and Plan?
Current and Future Redevelopment Projects:
•District Court redevelopment by Diamond Sinacori
- Over $850K in hazardous materials removal costs identified
- LDA executed and project began local permitting
•Superior Court and County Commissioners Buildings
- Legislation signed by Governor to convey properties to SRA
- Properties will require significant hazmat abatement and
restoration
•City-owned parcel adjacent to MBTA Station
- Planning Department working with Arrowstreet Architects
on pre-development study of parcel
Questions / Comments?
1
2
3 4 and 5
Proposed HD
Zone Parcels:
1.65 Washington
Street (District
Court)
2.252 Bridge
Street
3.32-50 Federal
Street (Salem
Superior
Court)
4.29 Federal
Street
5.15 Federal
Street