Tuesday’s night council meeting has an agenda item that pertains to affordable housing in Oakley. There is nothing like a discussion on affordable housing to fill up the council chambers. I originally posted this article in March of 2009.
Here is a brief background on the agenda item followed by the original post. The original post does not contain a discussion of what a density bonus is.
Corporation for Better Housing (CBH) owns and manages an affordable family and senior community on a 17.81 acre site at the west end of Carol Lane. There are six buildings approved in a campus-like environment with a gated entry, common landscape areas, oak tree grove, and both family and senior community centers for the residents. CBH has submitted a Density Bonus application that would allow for up to an additional 105 units within a total of three four-story buildings on the project site.
Tuesday night’s Council meeting will include an item on the Housing Element update. State law requires cities and counties to update their General Plan Housing Elements every five years in order to periodically address the changing housing needs of their communities and to establish action plans to meet those goals. The State requires that a complete and approved draft be submitted by June 26, 2009.
In every update we have done in the past the State has required that we plan for more affordable housing and this one is no different. The state has determined that we need to provide for an additional 88 units. The city is not required to build affordable housing only to provide, in our zoning ordinance, a sufficient amount of land at appropriate density levels to meet the State’s requirements. Some of the most difficult decisions that have been made and will be made in the future by the City Council involve determining where to zone for affordable housing in the City of Oakley.
So, exactly what is “affordable housing”?
Affordable housing is not Section 8. Section 8 is a Federal program administered by the County Housing Authority who contract with home owners to rent their home to qualified tenants. The Section 8 program pays the difference between 30 percent of the household annual income and fair market rent charged by the landlord. Households with incomes of 50 percent or below the area median income are eligible to participate in the program.
In one sentence; housing is considered affordable if it costs no more than 30% of the monthly household income for mortgage or rent and utilities. To help determine what is affordable in various locations we need the locations median income (for Oakley it is around $89,000) and economic income categories. For planning purposes, the Department of Housing and Community Development has established income definitions based on the Median Family Income (MFI) within California counties. The following table presents income categories applicable to Oakley.
Affordable housing simply means that there must be available dwelling units costing no more than 30% of gross household income to households at or below 80% of the city median income.
So why did we need “affordable housing”? Without going into the debate as to why, the sad reality today is that a substantial proportion of California families can’t afford to pay market prices for housing. To meet these needs State law requires every city and county in California to adopt a plan to make adequate provisions for the housing needs of all economic segments of the community.
Affordable housing is generally built by a non-profit organization using a myriad of tax credits and grants. The process for financing these projects is well beyond my skill set. But, I can list some of the organizations that have provided financing: Low Income Housing Tax Credits (LIHTC), Affordable Housing Program of the Federal Home Loan Bank of San Francisco, California Association of Local Housing Finance Agencies (CAL-ALHFA), California Tax Credit Allocation Committee (TCAC), Citigroup Public Finance and local redevelopment agency funds.
Since 1976 California law has required that not less than twenty percent (20%) of the redevelopment tax increment must be set aside for “increasing, improving, and preserving the community’s supply of low and moderate-income housing”, within the redevelopment area. These Tax Increment Set-Aside (TISA) funds are held by each agency in a separate Low and Moderate Income Housing Fund until used. Redevelopment agencies use TISA funds in a variety of ways most frequently in partnership with nonprofit housing development corporations in projects that combine TISA and other funding streams.
What happens if we don’t comply with HCD revisions to the City’s Housing Element? When a jurisdiction’s Housing Element is found to be out of compliance with State law, its General Plan is at risk of being deemed inadequate, and therefore invalid. Because all planning and development decisions must be consistent with a valid General Plan, a local government with a non-compliant General Plan may not proceed to make land use decisions and approve development until it brings its General Plan—including its Housing Element—into compliance with State law. A Housing Element is considered out of compliance if: 1) It has not been revised and updated by the statutory deadline, or 2) its contents do not substantially comply with the statutory requirements.
Several affordable housing advocate organizations have sued California jurisdictions for housing element non-compliance. Litigants include California Affordable Housing Law Project (CAHLP), California Rural Legal Assistance, Public Interest Law Project, Legal Aid of Marin County, and Legal Services of Northern California. These law suits generally have resulted in two types of consequences: building moratoria and the payment of legal fees. In the recent past judges have stopped all development, including some ongoing projects until the housing element was in compliance.
Pleasanton was sued in 2006 by housing advocates for failing to meet its affordable housing requirements. That case has not yet been resolved.
In another case in 2003, CAHLP and Sonoma County Housing Advocacy Group sued Santa Rosa. Under the terms of the settlement, Santa Rosa is committed to simplifying the approval process for higher density housing developments, to specify a site for a 40+ bed homeless shelter and assisting with its acquisition, to establishing an affordable housing trust fund, and to imposing a fee on new commercial and industrial development to support development of housing for facilities’ workers.
Recently the City of Pittsburg was sued by the CAHLP and Public Advocates, Inc. The settlement committed Pittsburg to produce 990 units of affordable housing over 9 years. 396 of these units must be affordable to very low income residents. 200 of these must be built with 4 years. The City also agreed to provide incentives for construction of larger units, and units affordable to extremely low income residents, and to provide a preference that ensures that people who live or work in Pittsburg will benefit from the new units.