At last Tuesday night’s Council we appointed the 2014- 2022 Housing Element Update Ad-Hoc Citizen Advisory Committee. Their role will be to re-evaluate the City’s existing housing sites, and policies and programs to meet updated State laws, housing needs, and establish new quantified objectives and then provide direction to the City Council for updating the Housing Element. One of the components of this process will include ‘Affordable Housing’.
So, exactly what is “Affordable Housing”?
Affordable housing, in this context, 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 do 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), and Citigroup Public Finance.
What happens if the HCD does not certify our update 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.
I originally posted this a number of years ago and when I updated for today I forgot to update the Pleasanton issue. You can read what happened in Pleasanton here https://romickinoakley.wordpress.com/2012/01/11/judges-ruling-could-affect-where-and-how-much-housing-is-created/
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 within 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.