Chapel Hill wants to be more attractive to developers. Could these changes work?

Residents will get a chance Wednesday to tell the Chapel Hill Town Council what they think about adding more homes to existing neighborhoods and further streamlining public hearings and town reviews for large projects.

There could be tradeoffs to allowing smaller in-fill lots and larger duplexes, cottages and accessory dwelling units, including less tree canopy and more stormwater runoff. Removing minimum parking requirements could increase the number of drivers parking on the street, town staff said

But Chapel Hill’s controversial Housing Choices strategy, which rezoned single-family neighborhoods in 2023 to allow duplexes and a second, smaller home on existing lots, isn’t working, staff said.

“Considering Chapel Hill’s chronically high land costs coupled with today’s high material costs and labor shortages, it is extremely difficult for homebuilders to generate a reasonable return on their investment” under the current rules, they reported.

The town has been working for several years to attract more low- and middle-income housing and to streamline its lengthy development approval process.

Expanding the conditional zoning process in 2018 let the council negotiate with developers for affordable housing and to address neighborhood concerns like traffic. But large projects can still take years, from a concept plan to an official application, with more reviews after the council’s approval.

The latest changes would let developers file an official application without first submitting a concept plan for council review. Similar changes approved in 2022 sought to fast-track projects with at least 25% affordable housing units.

The council already reduced the role of advisory boards in 2023 and last year disbanded nine of its roughly 20 advisory boards.

The council meets at 6 p.m. Wednesday and could vote in November on the proposed changes, which stem from an ongoing update to the town’s land-use management ordinance (LUMO), which regulates how and where the town grows and was last revised in 2003.

Wednesday’s agenda also includes discussion of a vacant council seat and two residential projects: 115 Chapel Point Road at Carraway Village and East Lakeview at 5640 Old Chapel Hill Road.

Here’s a closer look at the proposed changes:

How could town development processes change?

Site Plan Reviews

• Developers could apply for a zoning compliance permit from town staff, instead of submitting a site plan to the Planning Commission.
• Staff recommends an exception for Northside and Pine Knolls, historically African-American neighborhoods that have rules for the size and location of homes.
• The Planning Commission supported the change, including for Pine Knolls and Northside.

Concept Plan Reviews

Developers submit concept plans for large projects to get feedback from staff, public and council before submitting an official application. It can add a year or more to the process, along with additional costs.

• The change would eliminate concept plan reviews for conditional zoning and special use permit applications, affecting most large projects.
• Only a slim majority of Planning Commission members supported the change. Others recommended waiting to see if concept plan changes implemented in 2023 will address developer concerns about the extra time and money invested.

Conditional Zoning

Conditional zoning lets the council negotiate specific concerns with a developer that wants to build a more dense and/or taller project. It allows the council to consider public opinion, in addition to facts and evidence.

• The change would let developers submit a less detailed plan to the council and get it approved after one public hearing, instead of two.
• Town staff would review more detailed construction plans before issuing permits.
• The Community Design Commission would no longer review the exterior details of approved projects like building materials, landscaping and streetscapes.
• The change would update a list of “minor modifications” that staff can approve without council input.
• The Planning Commission supported some changes, but worried about limiting public input and the council’s ability to get more information from staff or development experts. The board also noted potential issues with making accurate changes on the same night as a hearing and vote.

Special Use Permits

Special-use permits (SUPs) let developers pursue projects that zoning may not allow, but that could work with conditions, such as a daycare with limits on traffic and parking in a single-family neighborhood.

The approval process is quasi-judicial, requiring the council to only consider facts and expert testimony. It became less common after the town expanded the use of conditional zoning in 2018.

• The change would let developers add new residential and commercial uses to a site with an approved SUP. The new uses must be allowed under existing zoning rules.
• The change would largely affect projects approved before 2018.
• New land uses would only require town staff approval.

How could changes affect neighborhoods?

The changes would eliminate minimum parking requirements and facilitate smaller housing options, including for homebuyers.

• Duplexes could have more than four cars and, similar to single-family homes, use up to 40% of the front yard for parking.
• Larger duplexes (up to 5,000 square feet), cottages (up to 1,500 square feet) and accessory dwelling units (up to 1,000 square feet) would be allowed.
• Accessory dwelling units could be built on a “sublot,” within an existing lot. 
• Property owners could ask town staff to subdivide their lots, including on land with limited or no access to road frontage
• Builders who add homes to existing neighborhoods on local streets would not have to add sidewalks, bike lanes, or curb and gutters.
• Homes could share driveways.

What are other proposed changes?

• Manufactured home parks would become a permitted use. The town’s existing mobile home parks were built before being annexed into the town and have remained non-conforming uses, limiting the owner’s ability to improve and expand them.
• Create more options for signs in residential areas.
• Allow multiple permitted uses on the same property. The town’s current land-use rules require developers to identify a primary use, which “makes mixed-use development unnecessarily difficult,” staff said.

Tammy Grubb

The News & Observer

919-829-8926

Tammy Grubb has written about Orange County’s politics, people and government since 2010. She is a UNC-Chapel Hill alumna and has lived and worked in the Triangle for over 30 years.