HPC_MEMO AFFORDABLE HOUSING DEVELOPMENT BONUS PROGRAM 012726.DOCX

MEMORANDUM
TO:
Historic Preservation Commission members
FROM:
Ryan Levesque, Deputy Director Community Development - Planning, Jacob Payne, 
Principal Planner, Community Development
DATE:
February 11, 2026
SUBJECT: Tempe’s Draft Affordable Housing Development Bonus Program
BACKGROUND:
Affordable housing is important to many people in Tempe. The City is considering a new voluntary 
program that would provide long-term affordable housing by allowing more dwellings to be built in multi-
family, commercial and industrial areas already designated for growth, with some units being 
designated for affordable housing.
Arizona Revised Statues Section 9-461.16 restricts cities from requiring, conditioning or imposing on 
private development to provide affordable housing. This section, however, does allow cities to adopt 
voluntary incentive programs to increase the supply of affordable housing. Several cities in Arizona 
have adopted their own versions of a bonus program to achieve these guaranteed affordable units.
Key Points:
Some key points in the proposed Ordinance include:

In return for designating a percentage of dwelling units for households within a certain income 
range, new developments receive a bonus in density, building height, and reductions in required 
parking.

The program functions as an opt-in Overlay Zoning district, which would be added through a 
staff-level process once proper documentation is received to confirm the project’s guarantee on 
the affordable housing.

The bonus in residential density is derived from, and limited to, the Projected Residential 
Density for that property as shown in the voter-approved Tempe Tomorrow - General Plan 
2050.

This program would be voluntary, with eligible sites being those with multi-family, commercial, or 
industrial zoning. The program would not be available to sites zoned for single-family.

The affordability of the units would be guaranteed for 30 years, through a deed restriction which 
would be recorded onto the property.

Depending on which range of affordability the units will be (i.e. 80%, 65% or 50% of the Area 
Median Income) the amount of units required to be affordable in development varies, with 
developers choosing which level of affordable housing they will offer in the development.

Establish a new R-6, multi-family zoning district. Creating the R-6 district does not change 
zoning anywhere in Tempe. Instead, it establishes a new option in the City’s zoning code that 
could be requested through a separate rezoning process in the future. If adopted, projects in the 
R-6 district would be eligible to participate in the bonus program.

The program would exempt locally registered historic properties from being eligible for the 
Bonus Program, and the utilization of the General Plan 2050 Projected Land Use and 
Residential Density Map for calculating bonuses renders Cultural Resource Areas (CRA) 
ineligible for the Bonus Program.
Draft Affordable Housing Development Bonus Program Ordinance:
Based on direction from the City Council and research into other bonus programs developed by our 
peer communities, the Community Development Department is seeking to implement this Affordable 
Housing Development Bonus Program into the Tempe Zoning and Development Code.

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The Ordinance would have the effect of creating a new Zoning Overlay District, one that would be 
requested to “opt-in to” by developers or property owners seeking to redevelop within Tempe. This 
Overlay would grant additional density, building height, and reduced parking standards. In return, 
development opting to use this bonus program would be required to dedicate a certain percentage of 
the “extra” units gained from the bonus as housing for families/individuals within certain income ranges. 
This affordability would be guaranteed through a covenant recorded with the County.
The Overlay District’s opt-in procedure would differ from a standard rezoning. This rezoning would 
occur on an administrative level, reviewed and approved by City staff. In order to opt-in, staff would first 
confirm documentation for the commitment for the affordable units necessary and review the building 
design to ensure compliance with pertinent Codes.
Sites would only be eligible to opt-in to the Overlay if they are zoned multi-family, industrial, or 
commercial and have been designated for higher residential density in the Tempe General Plan 2050 
than what the property’s current zoning allows for. The bonus in density would be based on, and limited 
to, that density that the General Plan 2050 calls out for that individual property. A General Plan 2050 
designation of Cultural Resource Area (CRA) would make a property ineligible for a bonus.
Also within this Ordinance is the creation of a new zoning district, R-6. The R-6 zoning district would be 
a high-density multi-family zoning district, allowing up to 45 units per acre. This new zoning district was 
noted as a future zoning within the General Plan 2050, and corresponds to the highest, solely 
residential density projected in the Plan. If adopted, the R-6 zoning would not be present on any 
property in Tempe but instead would be available for developers to request to rezone to, through 
standard rezoning processes. The new R-6 district could also be eligible to opt-in to the Affordable 
Housing Development Bonus Program.
Staff welcomes comments and suggestions from the Historic Preservation Commission on this topic.
Thank you!
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