In March 1999, San Luis Obispo adopted the first inclusionary housing program in the County.  The new program was designed to expand the number and type of dwellings affordable to households in the City. 

The program is part of the City's Municipal Code (SLOMC 17.91) and requires most new residential and commercial development to contribute to affordable housing, either by constructing affordable housing with the project or by paying an “in-lieu” fee to the City's Affordable Housing Fund to help affordable housing development throughout the City. 

The program applies to both residential and commercial development. 

Affordable Housing Fund (AHF) 

The City's Affordable Housing Fund (AHF) was established in 1999 through the adoption of the City’s Inclusionary Housing Ordinance. The ordinance allows for a fee to be paid “in-lieu” of the provision of required affordable housing units and the funds are placed in the AHF. The City then uses those fees in a variety of ways to make more affordable housing available in the community. These funds are awarded at the City Council’s sole discretion, based on previously adopted criteria. Requests for AHF support are evaluated by staff and forwarded to the City Council for consideration

Affordable Housing Incentives

If you're thinking about developing housing in San Luis Obispo, the City offers a range of affordable housing incentives that may be of interest. The Affordable Housing Incentives are part of the City's Municipal Code (Ch. 17.90) and describe benefits available to affordable housing developers.  Incentives include residential density bonuses, fee reductions or waivers, city installation of off-site improvements, direct city financial assistance, subdivision, zoning or other exceptions to city standards and other incentives that may be negotiated between the City and developer. 

Community Development Block Grant (CDBG)

The Community Development Block Grant Program is an annual, flexible program providing communities with resources to address a wide range of unique community development needs. The program works to ensure decent, affordable housing; to provide services for members of our community; and to create jobs through expansion and retention of businesses. 

CDBG grants are awarded by the US Department of Housing and Urban Development (HUD) and provide funds for projects and programs that benefit low- and moderate-income households, businesses and community-based organizations. Applications for the 2020 Funding Year are available online.

Program Overview

CDBG activities must, by law, meet federal objectives and rules. HUD has three broad national objectives:

1. To benefit persons and households with incomes below 80 percent of area median incomes;

2. To aid in the prevention or elimination of slums or blight; and

3. To meet urgent community development needs that pose a serious, immediate threat to public health or welfare, such as floods, earthquakes or other disasters.

CDBG-eligible activities include: acquisition of real property for affordable housing, construction or rehabilitation of certain public facilities, site/building clearance and demolition to support affordable housing, provision of certain types of public services, removal of architectural barriers for the disabled, housing rehabilitation, historic preservation, code enforcement, special economic development activities, planning studies and grant administration.