Chapel Hill, N.C. — Town officials have proposed requiring developers to set aside 15 percent of new projects for affordable housing, but a representative for area home builders said the idea could be illegal.

Chapel Hill's Town Council has already implemented the 15 percent requirement when a developer needs a special-use permit, and an ordinance proposed by town planners would make the set-aside rule apply to all developers, including renovations to existing plans that add units to projects.

"We think that just adds to the value our community to have a more diverse community and to offer a wide range of housing opportunities here," said Loryn Clark, housing neighborhood services manager for Chapel Hill.

Garrett Davis, a planner for Chapel Hill, said he would like to live in town but can't afford it.

"(I'm) just looking at the mortgage calculator on the (Multiple Listing Service) site. That's kind of what's kept it off the short list so far," Davis said.

Chapel Hill officials said almost 47 percent of town employees live more than 10 miles from the center of town, including some as far away as Burlington. Only 3 percent live within a mile of the intersection of Franklin and Columbia streets, officials said.

In return for dedicating part of projects to affordable housing, developers would be allowed to build bigger or more units.

Nick Tennyson, executive director for the Homebuilders Association of Durham, Orange & Chatham, said the idea of adding more space or units likely won't work in traditional subdivisions.

"It's hard to make projects work when you are doing 15 percent of them effectively without any profit built into those houses," Tennyson said, adding that he questions the legality of the proposal.

"Nobody has granted Chapel Hill or any other jurisdiction in North Carolina the right to limit the price of housing," he said.

Clark said a committee that studied the issue feels the town is within its rights. There has also been a suggestion to give Chapel Hill employees the first crack at the affordable homes.