By Dr. Jonty Cogger, Attorney at Ndifuna Ukwazi
The Stellenbosch Municipality has published a draft Inclusionary Zoning Policy for public comment (due on the 8th of May 2023). It is a welcome and monumental feat towards redressing the scars of apartheid spatial planning, but where is the Cape Town policy which was promised in November 2019?
When the policy is finalised, Stellenbosch will be the second municipality in South Africa (after Johannesburg in 2019) to adopt inclusionary housing as a land use planning tool. It’s also the first Western Cape municipality to publish a draft policy after the Western Cape Government adopted a Framework Policy as guidance to local municipalities late last year. Other municipalities expected to follow suit are George and Paarl.
What inclusionary zoning does is incentivise the inclusion of affordable homes in private developments for working class people typically in the ‘Gap market’ – i.e., earning too much for a full government subsidy (R3 500 per month) but not enough to complete on the open property market (R27 000 per month).
Inclusionary zoning obliges private developers to contribute towards spatial restructuring by including affordable housing in new residential developments in exchange for additional development rights. It’s a win/win for developers and the public in that it increases affordable homes and integrates communities but also compensates a developer by granting incentives like additional development rights, fast tracking, development charges holidays, and reduced parking requirements. Until now, developers have benefited from a host of public infrastructural amenities in well-located areas (higher zoning, access to good schools, healthcare etc) without any reciprocal obligation to contribute towards the public good.
It cannot be over-emphasised how important inclusionary zoning is for spatial restructuring and redressing racial segregation. During the post-apartheid-era, government-subsidised housing has primarily been built in peripheral locations whereas the private sector has catered for the luxury market in previously “whites-only” areas. The stark spatial division in Cape Town and Stellenbosch (as with many other towns and cities) is evident in how exclusionary residential markets are located in well-off areas, inaccessible and unaffordable to the majority of residents.
There are broadly two options for inclusionary housing contributions in the Stellenbosch policy. The first is a mandatory requirement applicable to ‘well-located priority development areas’ (such as Adam Tas Corridor, Stellenbosch Town, Klapmuts and Franschhoek) where an overlay zone will be in place. A mandatory 20% affordable units in any development with more than 20 proposed residential market-rate units will be required in the priority development areas. A mandatory 30% of affordable housing will be required for residential development in an overlay zone to be implemented in the Adam Tas Corridor. Developers may voluntarily contribute affordable housing for developments with 20 residential units or less if they wish to benefit from incentives offered in the inclusionary zoning policy.
Typically, developers can contribute towards inclusionary housing in three ways: 1. by building units in the development (on-site), 2. building units in another development in a well-located area (off-site); or 3. paying a monetary fee (fees-in-lieu). The Stellenbosch policy has made on-site the primary option in the mandatory contributions (i.e., Adam Tas Corridor, Stellenbosch Town, Klapmuts and Franschhoek). Off-site will apply to voluntary contributions or developments that are not well-located to ensure that it still contributes towards providing affordable homes in better locations of Stellenbosch (areas identified as such in the Spatial Development Framework). Fees-in-lieu will also be an option in a voluntary contribution or if negotiated by the Stellenbosh municipality as part of a mandatory contribution (determined on a case-by-case basis).
The affordable housing can be rented or sold by the developer and are protected from being released on the open market for a period of 30 years. In terms of the policy, the affordable homes cannot be used for student accommodation or for transient guests (home lodging, bed and breakfast, hotel, tourist accommodation establishment, tourist dwelling unit, etc.)
The policy also includes a measure of flexibility that allows private developers to negotiate the size and form of inclusionary housing contribution based on feasibility or practical restrictions. This is particularly important since it debunks the notion often given by the Cape Town Mayor, Geordin Hill-Lewis that inclusionary housing will somehow scare away developers. This is clearly not an insurmountable problem for Stellenbosh who is willing to intervene in exclusionary markets that are unsustainable, inefficient and a burden to the public fiscus.
It begs the question of not only why it has taken so long for Cape Town to adopt a policy but also why it is content on allowing spatial inequality to endure. Stellenbosch has produced an excellent policy. It shouldn’t take 4 years to develop a policy whereas Stellenbosh only took less than 3 year. It is hoped that the publishing of the Stellenbosh policy will jolt Cape Town into urgent action to catch up with its sister municipality.
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Property Wheel.