Land Use Incentive Grant (LUIG) Program

Last updated or reviewed on February 1, 2024

What is the Land Use Incentive Grant?

The Land Use Incentive Grant (LUIG) Program was created in 2011 to incentivize the inclusion of affordable housing for individuals and families in developments. The City of Asheville hopes to encourage all developers to fulfill their mission as well as ours by keeping Asheville a vibrant and affordable place to live. If you are considering adding affordable units to your development or preserving and protecting affordable housing, please read the policy and guidance in its entirety.

LUIG policy – July 2021

 

Eligible Uses/Criteria

LUIG uses future projected tax revenue to help fund affordable rental units for households at or below 80% AMI: 

  • The incentive is for rental housing – minimum of 2 units.  
  • Baseline LUIG requirement is 20% of units must be affordable.
  • Vouchers must be accepted for at least 50% of the affordable units. 
  • Affordable is defined by 80% AMI (can be lower).
  • Affordability period of at least 20 years. 
  • In mixed use developments, residential use must be at least 70% of rentable square footage. 
  • Must be located within the city limits.
  • Incentive will only grant city taxes, and does not include county property taxes.

The program has evolved over time with different requirements and tax benefits. The last policy revision (June 2021) added converting existing market rate units to affordable units as an option.  

Staff will be pursuing potential policy revisions with the Housing & Community Development Committee and Policy, Finance & HR Committee in 2023-4.  Additional eligibility and criteria information is listed within the policy. 

 

How does the Incentive work?

Take a look at our Introduction to Land Use Incentive Grants presentation. 

 

Application Process

  1. Staff highly recommends a meeting between staff and the applicant before an application is turned in.  This can prevent mistakes and revisions being required and delays due to poor applications.   
  2. Applicant turns in application and submits $300 application fee at least 4 weeks before any public meetings to be held.  For Conditional Zoning projects, it is recommended to turn in the application at the same time (or earlier) as submitting plans for TRC review.  Failure to do so may result in delays in scheduling the Conditional Zoning hearing at City Council. 
  3. Staff reviews application, evaluates matrix and what is being offered 
  4. Reviews information with applicant, talks through any issues or gaps in information, then prepares a report with a recommendation  
  5. Housing & Community Development Committee (HCD) Review, makes recommendation to Council, for strategic goal alignment regarding affordable housing. 
  6. Policy, Finance & Human Resources Committee review, makes recommendation to Council, in their role of financial oversight. 
  7. City Council will hold a public hearing.  For Conditional Zoning (CZ) projects, it will usually be the same evening as the CZ hearing.  Council usually votes the same evening as the public hearing but may elect to continue the item for further information or deliberation.
  8. Once Council approves the grant, staff will work with the applicant to draft the grant agreement document and Deed Restriction.
  9. Documents are executed and restrictions are recorded before the project is built. 
  10. Payments are made as reimbursements to property owners after they have paid their taxes.   
  11. Property owners have to submit documentation of their tax payments, showing that they have rented units to qualified households, and that rents are within the guidelines. 

 

Contact Information

Sasha Vrtunski, Affordable Housing Officer
svrtunski@ashevillenc.gov