Earlier this month, Nashville residents told Metro Council they want the city’s help getting community needs met.
They say the rezoning of an East Nashville property that used to be home to the Riverchase apartments, should be used as leverage until they can get a community benefits agreement that’s on their terms.
“I would suggest a deferral or a no vote to allow displaced Riverchase residents direct consultation on the potential CBA,” organizer Melissa Cherry said at the meeting.
“This entire real estate transaction falls far short and will undermine the future of CBAs,” resident and Laborers’ International Union of North America staffer Ethan Link said.
His organization was at the negotiating table with Stand Up Nashville trying to get an agreement from Texas-based developer CREA. Instead, there’s a tentative agreement with The Urban League that goes into effect if rezoning happens.
A city lawyer warned the council against voting based on a community benefits agreement happening. That’s because a state law strips the city of power to help its residents in this way.
In 2016, Nashville attempted to create a trade-off with property owners and developers. If they ask for more zoning rights, the city would require they set aside a percentage of units at a cheaper price. In exchange, the developer would’ve been able to build to the maximum height of the subdistrict.
This pre-empted law is called inclusionary zoning, and it got a lot of pushback from the Beacon Center, a think tank that promotes competition between private businesses without restrictions.
In the next legislative session, the state of Tennessee stepped all over it.
“What this does is prevent the city from coming in and mandating through zoning changes that there has to be low-rent housing,” the sponsor of the law, Ferrell Haile from Gallatin, says. “If they want low-rent housing, and they need it. The city needs it. There’s no question about that. But let’s do it as the city itself.”
The state’s move gives property owners and developers more power to do things their way. While the city can only stand by and give them treats for doing it.
“MDHA can do certain pieces. Metro can do certain pieces. And we desperately need the private market to do certain pieces,” Councilmember Burkley Allen says. “So the potential is there, but it’s still something that we’re trying to work out the process for.”
This gets tricky when two entities can’t agree and need a referee because the city is limited in playing that role.
In the case of Riverchase, after months of zoning being held up, the developer has flexed its muscles in negotiating and threatened to ditch building affordable units and move forward with townhomes at market rate.
It’s been six years since the state law passed, and the city is still testing out tools to meet community needs while staying in line with the state. In May, the city passed a law to reduce property taxes on some new apartment buildings that agree to charge less rent for people earning low incomes for a specific percentage of units.
Over the last few years, the city has used federal funds to fund affordable housing and homelessness programs. Later this year, the city will decide if housing should get a second consistent stream of money, which continues the city’s uphill climb to build enough units to meet demand while competing in an expensive private market.
In 2022, the average Nashvillian is 10 to 20% worse off than last year.
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