Financial Feasibility Analysis
STRATEGIES
CONSIDER PAYMENT IN LIEU OF UNITS IN CERTAIN CIRCUMSTANCES
¢ A payment in lieu of units allows for the city to elect to receive a cash
payment to the Housing Trust fund instead of having the units delivered
Payment in lieu strategies oftentimes are used to avoid affordable units
being concentrated in select areas
The approach also is common to alleviate an additional financial burden
when a ‘partial unit’ is calculated
¢ 75-unit development with a 10% IZ requirement = 7.5 units
¢ A payment in lieu allows for a cash equivalent to be paid for the 0.5 unit
RKG recommends Nashua use payment for partial unit calculations
¢ Current value differential between 80% AMI and market rate about $36,000
City also can consider special exception in mitigating situations
¢ This would be exclusive decision of the city
¢ Situations such as avoiding concentrations or to capitalize the Housing Trust
fund for an impending project
ASSOCIATES INC
UNIT VALUE DIFFERENTIAL
FROM MARKET RATE UNITS
MARKET RATE
-$35.940
80
%
AMI
p= -$62,370
p= -$115,230
50
%
AMI
