Cost to the Jurisdiction
Inclusionary zoning programs result in few "hard costs" for jurisdictions beyond the costs of administering the program. However, some cost offsets provided to builders (e.g., fee waivers) can result in lost revenue. Therefore, it is important to quantify the amount of lost revenue and assess the benefit of the trade off. Also, when jurisdictions acquire affordable units from developers, they may incur further costs by providing subsidies to lower income families. When all the factors are weighed, nearly all jurisdictions have found inclusionary zoning to be a viable and cost-effective strategy for producing affordable housing.
Cost to Developer
Builders contribute to the stock of affordable housing in a jurisdiction since their developments benefit from the public investment in infrastructure (e.g., transportation, sewage, etc.). Furthermore, developers are given compensation for building units. Jurisdictions set compensations at a level that allows builders to profit or break even from the construction of affordable units.