Philly City Council to consider tax break measure to add more affordable housing

Council President Clarke speaks at a podium in City Hall.

City Council President Darrell Clarke discusses a tax break proposal to encourage developers to include affordable housing units in their buildings on Dec. 15, 2022. (Tom MacDonald/WHYY)

Tax breaks for developers who add affordable housing units is up for consideration by Philadelphia City Council.

The break would go to developers who put aside 30% of multi-unit dwellings for affordable housing. Council President Darrell Clarke introduced the measure Thursday morning and said that for now, it would only apply to parts of his district and Councilmember Cindy Bass’s district.

“If a developer, as an example, builds 50 units and takes advantage of the incentive, 30% of that 50-unit development would be affordable housing,” Clarke said. “So we’re using that tax abatement to incentivize the building of affordable housing.”

Maria Gonzalez, president of the Pennsylvania Association of Community Development Corporation, believes the incentive will create additional affordable housing in areas that have suffered for decades from lack of investment.

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“The creation of new affordable housing is very effective for reducing vacancy rates, eliminating blight, increasing home values, boosting the confidence of long-term residents, and to attract new investments,” she said.

The 10-year tax break would be on the cost of construction or the improvements in blighted neighborhoods.

“This is something that is very important, we know that more and more people are being pushed out of their homes,” said Councilmember Bass, a co-sponsor of the bill. “Affordability is through the roof right now, even for working professionals, even for folks who are financially more savvy, even for folks who are earning higher incomes.”

Earlier this week, city leaders broke ground on a development of eight new affordable

homes that will sell for $230,000. It’s part of a $400 million neighborhood preservation initiative spurred by City Council.

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Broke in PhillyWHYY is one of over 20 news organizations producing Broke in Philly, a collaborative reporting project on solutions to poverty and the city’s push towards economic justice. Follow us at @BrokeInPhilly.

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