Davis City Council Questions: Question 5 – Affordable Housing

This is our fifth of eight questions.  The candidates get exactly 250 words.  The answer was due at 9 pm on Thursday.

Question 5: Everyone says they want affordable housing.  But with the loss of Redevelopment funding, actually building it is difficult.  If elected, how would you change the affordable housing ordinance and what policies would you pass to ensure that affordable housing can get financed and built at the level you advocate?


District 2

Dillan Horton

A couple of years ago the City Council made a decision to essentially nullify their affordable housing ordinance and specifically the provisions that require a percentage of affordable housing to be built in new developments.

Many thought that this provision was an obstacle to building any housing at all. Though I recognize that some developers said that these affordable housing thresholds were financially unworkable in housing developments, this decision over time will reduce the stock of affordable housing in the City of Davis.

I believe the best way for the city to start improving the situation is to recommit to its own affordable housing ordinance. This will help expand the stock of affordable housing built in future development projects.

As market-rate housing expands, so should the availability of affordable housing. The city should also encourage more developers to contribute to the housing trust fund. This would give the city resources to finance the building of additional affordable housing or to provide other kinds of support for those struggling to afford rising housing costs.

At some points in the past developers have used the option of housing trust fund contributions to get out of obligations to build affordable housing units. To avoid this, the city should use this option in conjunction with the building of affordable housing units, along with making sure that developer contributions are fair for the community and have an actual impact addressing housing needs.

Colin Walsh

The loss of redevelopment funding is regrettable, but affordable housing is continuing to be built across the state with other sources of funding and mechanisms. The end of redevelopment agencies has not been the end of affordable housing construction.

The first step is to do an independent, in-depth study that looks at what level of inclusionary housing is actually achievable. We need a solid understanding of what can work so that the city is not relying on subjective claims by developers of what does or does not “pencil out.” The city needs an independent arbitrator of how affordable housing can be included so we can maximize affordable units in future projects.

Secondly, I would like to look into restoring the suspended Middle Income Ordinance to provide affordable workforce housing. I think the most impactful example built in Davis has been the Dos Pinos housing cooperative. I would like to see more projects like Dos Pinos.

Third, Davis impact fees are currently based on unit numbers and not unit size. I would like to see impact fees based on square footage rather than number of units. It doesn’t make sense that a 1-bedroom apartment and a 5-bedroom apartment pay the same impact fees.

Lastly, the goal should be to restore, or get closer to the 25% requirement of the suspended affordable housing ordinance and to strengthen affordability requirements in mixed use development.


District 3

Lucas Frerichs

Davis has built nearly 1,500 units of permanently Affordable units since the inception of the Inclusionary Housing Ordinance in the early 1990s.  Most recently, Creekside Commons (90- 1 &2 BR units) has opened within the last few months, and Mutual Housing @5th (38 units) will be under construction shortly. Other land dedication sites are on the horizon, including the four acres at BrettonWoods, etc.

The vast majority of the units constructed have been built using the land dedication tool, as well as funding from a variety of local, state and federal sources.  The loss of Redevelopment dollars has significantly hamstrung local governments’ ability to contribute and construct Affordable housing.

We’ve had to look for additional tools to help create Affordable housing, and I’m proud that we were able to find a way for students to utilize some of these units (coming soon -Lincoln40 & DavisLive). We’ve also found a way to have developers create an ongoing funding source to provide affordable units (3850 Chiles Rd- not yet under construction).

It is time to reexamine the city’s inclusionary housing ordinance.  I’d propose a focused & intense stakeholder effort that includes a Council subcommittee,  City Commissioners, (Social Services & Planning),  housing advocates (Sac. Housing Alliance, Mutual Housing CA, Neighborhood Partners, Legal Services of Northern CA) and the public, among others. I’d like to see a suite of recommendations from this stakeholder process for the Council to consider, prior to making necessary changes/upgrades.

Larry Guenther

Changes to the Affordable Housing ordinance: removal of the exemption for mixed-use buildings, an actual number for minimums in the Downtown (to be determined by the Social Services Commission using evidence and input from local developers), update the in-lieu fee, and include the recommendations from the Social Services Commission.

By its nature, new construction is expensive, though residential rents have gone up a lot faster than materials costs. Refurbishing existing housing stock to Affordable Housing is a good way to make more headway on this issue and would be a more efficient use of the Affordable Housing fund.

Also, there is affordable housing that is not officially designated Affordable. Many of the older apartment complexes—many near downtown—are heavily populated by working families. We must not trade this for new construction with what can be defined as “Affordable.” The University Commons project is an example of defined “Affordable Housing” that is actually more expensive than existing market-rate housing. This is a somewhat shameful use of an equation to make a project look good.

Additionally, Affordable Housing numbers should be “net” numbers. For example, the Lincoln 40 project removed housing that was less expensive than the Affordable Housing associated with that project. Again, using math to make things look better than they are should not be City policy.

Long-term affordability—increasing limited-equity ownership opportunities (a la Dos Pinos, etc.) allows a much broader swath of the economic spectrum to gain equity and improve their economic station.


District 5

Josh Chapman

The City should enforce the existing ordinance and be consistent in its expectations from developers. In the current environment, projects and modifications to affordable housing are approved on an ad-hoc basis, which creates great inconsistencies in affordable housing inventory. Affordable housing requirements exist for proposed development projects and enforcing these requirements would create more certainty for developers and add to the affordable housing supply.

Approval of the Downtown Plan with a focus on densification and building up would create more opportunities for affordable housing units. If we truly value equity and inclusivity, then the best way forward is to have a diverse plan that leads to more affordable units on the ground.

Expanding the Housing Trust Fund will support a wide variety of affordable housing development. Slight increases in development impact fees, allocating Transient Occupancy Tax (TOT) dollars to this fund, and re-exploring the $50 social services parcel tax that was proposed by Mayor (Robb) Davis are several options to explore. While as a small business owner I recognize the economic impact of the pandemic on all businesses, cities of comparable size in California have much higher in-lieu fees and this is a realistic approach to building more affordable housing.

Council should work to address the anti-development culture. There is a tremendous amount of misunderstanding about how much affordable housing single development projects generate. A social services parcel tax, which would generate $1.5 million a year, will open new and more sustainable ways to fund affordable housing.

Kelsey Fortune

Things like affordable rent by the bed allows property owners to charge higher prices for a unit by increasing the occupancy of a two bedroom to four people for instance. This is unacceptable. The current affordable housing ordinance offers too much flexibility and opportunities for developers to get around providing units at affordable prices. Building market rate housing in Davis will make money. Period. Rents and housing appreciation are so high, and vacancy rates so low that we can and should ask more of developers and current development.

I would recommend a simplified affordable housing ordinance for rentals that includes the following or something similar.

  1. 25% of rented units going to households making less than 120% of Yolo median income with price capped at 75% of market rate and
  2. 10%* of rented units going to households making less than 80% of Yolo median income with price capped at 50% of market rate.

This should be for new development as well as existing rentals. Anyone who owns 4 or more units is subject to (1) and anyone who owns 10 or more units is subject to (2). If a property does not comply in each month, fees would apply. For example, a fee of $1000 per occupied out of compliance unit.

Connor Gorman

The ideal (and most affordable) way to build housing in Davis (and elsewhere) would be through democratically controlled and publicly funded projects. At the moment, however, most projects in Davis are private and for-profit. Despite this, we still can, and must, hold these projects and their developers accountable to the needs and standards of the City, especially around affordability.  Using capitalist market forces (potentially in conjunction with densification) to address affordability might have some limited uses under the current economic and political system but direct pressure and requirements need to be a major component of our affordability plan.

One way to begin doing this is by strengthening our affordable housing ordinance, preferably by increasing the required percentages of Affordable units in housing developments but, at the very least, by closing loopholes.  One major loophole that needs to be addressed is developers paying in-lieu fees rather than actually building Affordable housing.  These fees are beneficial to both the City and the developer under certain circumstances but need to be increased substantially.  Furthermore, actual construction of Affordable units must be prioritized.

Another major loophole is by-the-bed “Affordability” in doubles where it’s questionable whether this is really any cheaper than renting a single market-rate room and splitting the cost between two people (I would be fine with by-the-bedroom, which is different than by-the-bed, Affordability under applicable circumstances though).  Finally, I think any Affordability plans need to involve Affordability that’s representative of the project’s bedroom arrangement.

Rochelle Swanson

Talking to voters across District 5 and the City, it is clear there are numerous definitions of “affordable.” We need to utilize the Housing Element process to get a mutual understanding of the term.

There is state defined Affordable (capital A) and “market-rate” affordable. I would advocate updating the Affordable Housing Ordinance based reflective of the data gathered during the Housing Element Update, including community input as to what is the right focus.

Personally, I think we need to be more thoughtful about placement of Affordable housing in relation to the type of housing—extremely low, very low and low income.

The breakdown of the 30% required Affordable units for new developments should be distributed according to location and availability of services. Not only should Affordable housing in Davis be distributed throughout the City, it should also be located near grocery stores and community amenities.

My focus is on people and not simply a door count. As to funding, we should maintain a set threshold of an agreed upon percentage within new developments along with an option for in-lieu fees where location and use is incompatible.

In addition to in-lieu fees, I want to explore real investments into a Housing Trust Fund to augment Affordable housing and provide down payment assistance for market-rate affordable.

Potential sources include leveraging city property, a portion of TOT, and a dedicated fee from real estate transactions, as well as lobbying the state to revisit redevelopment around affordable housing.


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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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41 Comments

  1. Chris Griffith

    You know why not let the virus be its own cure.

    The reason why we have an affordability problem is because we have a university here in the republic of Davis so why not let the University be in charge of housing and let them build all this housing why should it be the burden of the city? If the university can’t supply enough housing then they should limit the amount of students that go to UC Davis of course that’ll never happen that would make your heads explode so therefore they would never be a housing shortage.

    1. Alan Miller

      No no no no . . . . have the City deal with it but City can’t subsidize so we call on the state and feds who subsidize ‘A-fordable’ housing everywhere so less is built and all cost more and gets filtered off massive dollars by giant bureaucracy, but what little is left has small percentage that are ‘A-fordable’, unless there is exception for stacks or pay into in lieu fund . . . all a big joke — make the U do and/or let the market do it — but this isn’t local this is fed/state policies that are poison as everyone now trained that money from God (Gov’t) is infinite, so we just fighting for our tiny sliver, like it’s gonna get bigger, and it’s not, until right before the balloon gets over over inflated and goes BOOM POP BOOM and it’s all over follllllllks.   (but hopefully you’ll be dead and only our grand-children will suffer)

      1. Alan Miller

        That certainly ain’t true — they rather s@ck at it; maybe the best solution is instead of building on U land, the U turns over W. Vill land to City for annex and a private developer builds with no restriction except build for students.

        1. Richard McCann

          Alan

          Go over an look at the platted parcels in the NE corner of the West Village property that has been vacant for a decade as evidence of using that approach can’t work with UCD.

        2. Alan Miller

          That’s how they did West Village,

          They did?  So the City is getting the tax revenue?  That was my first reason why . . .

          they still had to pay prevailing wage.

          But WHY?  My understanding is this was still being done by the U and they chose the developer and had all their labor restriction which sent the costs through the roof, and therefore the mega-high rents.

          What I was suggesting is City gets land, opens for developer proposals, no LSA’s, and City gets tax revenue.  Is that impossible to happen?

        3. Alan Miller

          Alan – has UCD built their faculty housing?

          I’m gonna make like a debating VP candidate and not answer the question asked, but rather, answer a question of my own choosing.

          Answer:  “Yes, Ms. NPR, I do like Avocados”.

    2. Richard McCann

      We don’t ask other large employers to build housing for their business. And UC is not a housing agency. It’s not particularly good at building and maintaining housing–look at how it has let its married student housing on various campuses fall into disrepair until they were forced to refurbish it.

      Davis exists because of UCD. We are in a symbiotic relationship which extremely beneficial to Davis. If you don’t appreciate that relationship, you can move to Woodland or Dixon and see what it’s like without a UC campus. That relationship means that we must provide the support to UCD that is appropriate. We need to negotiate with the campus to appropriately allocate costs, but we cannot dictate to UCD how to run a system that benefits the entire state and is not just about Davis.

      1. Chris Griffith

        We don’t ask other large employers to build housing for their business..

        Shame on the City of Davis.   I the old days farmers supplied housing to farm workers, Mining companies supplied housing to miners they even built the schools for the children.

        Ya know Frank Lloyd Wrights school in Scottsdale Arizona was designed  and built rock by rock by students. Why cant U C Davis

        pitch in and help towards student housing?

         

  2. Chris Griffith

    Just an idea…

    The UC campus sits on 8.3 Miles of land that equates to somewhere around 5,300 acres if  UC Davis would donate just a few hundred acres to the to a special nonprofit of its choice and that nonprofit built housing for the UC Davis campus to circumvent the Davis Bacon Act which is the prevailing wage and then that nonprofit could donate back the built product in this case say apartment buildings it would be a win-win the housing cost would be much cheaper and it would save a whole lot of money by bypassing the prevailing wage act and if maybe just maybe someone could convince the city of Davis to wave the building fees that would be another way of saving money and maybe we might find some really smart students that UC Davis that might even be able to draw up a set up blueprints for this campus housing and that would even save more money… Just a thought 😊

    1. Bill Marshall

      sits on 8.3 Miles of land that equates to somewhere around 5,300 acres 

      This morning a CNN reporter pointed out how many “cubic tons” of debris had been removed from Lake Charles, LA after the last hurricane… ‘fake news’, to be sure!  Can’t fathom a cubic ton…

      Will assume you meant “square miles”… a mile is a measure of length… acres, and square miles are measures of area…

      But your math is correct if you meant ‘square miles’…

      Not sure if your methodology as far as Davis-Bacon would work… famous, certified [precedent setting!] case where a City got ‘busted’, because they required a developer to build a public library, then upon completion, ‘gift’ it to the City (or have the City reimburse the developer for actual costs… the situation is about 40 years ago)… the Courts found it to be a blatant, egregious effort to skirt ‘prevailing wage’ requirements… the City had a plan to build a library… but they got caught…

      1. Chris Griffith

        I can tell you that the department of employment and social services located on the corner of beamer and cottonwood Street in woodland California was owned by Yolo county that said property was sold for a nominal fee to accompany called Pantoniee construction I think I have the spelling correct on that name

        They built the building leased it back to the county and then eventually sold it back to the county with a good lawyer and a little creative thinking outside the box things like this can happen.

         

        And yes I meant square miles I typically don’t type I talk to my little candy bar phone and it spews out stuff 😊

    2. Ron Oertel

      I appreciate some of your thoughts on this blog, as well as your work on “Family Guy”.  😉

      In general, I also wouldn’t count on this blog (e.g., the author) putting forth information that is “complete”.

      1. David Greenwald

        “In general, I also wouldn’t count on this blog putting forth information that is “complete”.”

        Really Ron? We have control over the answers given by candidates for council? Or do you just like taking cheap shots for the hell of it these days?

          1. David Greenwald

            It’s still a cheap shot.

            Let’s substitute Ron’s name for this and see if he thinks he would ask us to pull the comment. “In general, I also wouldn’t count on “Ron” (e.g., the “commenter”) putting forth information that is “complete”.” I submit, that if someone had posted that, that you would send Don and me an email asking for its removal – correct?

        1. Ron Oertel

          I wouldn’t, either.  Though I try to put forth links to actual facts.

          My comment (in this case) referred to the assumptions regarding prevailing wage.

          1. David Greenwald

            You’re not addressing the point – if someone had posted that about you, you would ask us in an email to remove it – correct?

        1. Ron Oertel

          In this case, another commenter questioned the application (requirements) of prevailing wage on campus.  In other words, it may not always be required.

          Also seems strange that this isn’t a concern regarding other (non-residential) proposals, on campus.

          Beyond that, there’s the question of the impact that may or may not have, as well as the “fairness” of requiring prevailing wages for workers.

        2. Ron Oertel

          And perhaps more importantly, there are assumptions put forth in David’s statement which are not supported (e.g., even if prevailing wage is required).

        3. Ron Oertel

          Without even reading further:

          David: “in the case of West Village.”

           
          But again, this is likely a complex issue (regarding requirements, impacts, etc.), beyond one-liners.

          It is not, however, a “potshot”.

          If rent on campus is “too expensive”, it would either not be built, or would remain vacant. They will charge “prevailing rent”.

        4. Ron Oertel

          Just skimming the link that David posted:

          Under the Master Lease, Developer initially pays UC no rent for the land. When segments are completed Developer and UC will enter into “sub-phase” leases that will require Developer to pay UC rent in amounts increasing over time. 3 Developer will offer residences for sale to faculty and staff with resale prices tied to the cost of living index. If faculty and staff do not buy the residences, Developer may sell them to the general public. Developer will manage and rent the apartments to students at market rates. Developer is allowed to sublease the mixed-use space for uses that include retail stores, restaurants, banks, and laundromats. UC agreed to lease back 70 percent of the mixed-use space. UC constructed the off-site infrastructure

        5. Alan Miller

          Yes – they reached a stipulated agreement with labor in the case of West Village.

          And if you wonder who’s paying for that, take a look at the cost for a student to rent a room at West Village (I’m too lazy to look it up for y’all, but it’s a lot).

        6. Alan Miller

          Here’s one example (to be fair, this might include food and appears to be a luxury studio that is about the size of a tiny house; but also in comparison, there are 2-bedroom houses that go for less than this in town, even some if-you’re-lucky 3-bedrooms that are close):
          SPACIOUS Floor Plans – VIRIDIAN A1
          790 SQ FT | 1 BEDROOM/ 1 BATH
          Starting At:$2,265/MO
          LEARN MORE

        7. Keith Olsen

          to be fair, this might include food

          I remember paying for the food plan my daughter’s freshman year at UCD.  It was okay for a while then I started getting calls, “I need more money”.  I would ask why?  She would say “for food”.  I’m like but all your food is covered.  She would respond, “Dad, you can’t expect me to eat that stuff”.   So yes, I sent more money.

  3. Ron Oertel

    “Labor Code section 1771 generally requires the payment of prevailing wages to workers employed on public works.”

    So (just skimming it again), it appears that the document that David provided a link to also describes some situations in which that may NOT apply.

    But again, there is not necessarily a direct correlation between costs and rent.  If projected rent doesn’t “pencil out” (to cover costs), then developments generally don’t get built. Unless subsidized in some fashion (e.g., no cost for the use of UCD land).

    It is likely a more complex issue than what is presented on here.

    Maybe UCD should “open its books” (e.g. regarding housing), given that it’s publicly-funded. Maybe they already have?

  4. Ron Oertel

    I’m interpreting the document that David provided to mean that only “publicly-funded” developments are subject to “prevailing wage”.

    If that’s correct, perhaps he can explain the logic behind his claim that publicly-funded (publicly-subsidized) costs are passed on to renters.

    1. Don Shor

      We have discussed this before. Here’s a link to one of my comments on the topic:
      https://www.davisvanguard.org/2020/03/sunday-commentary-affordability-of-housing-on-campus-could-be-the-next-local-housing-crisis/#comment-420782

      Housing is considered an auxiliary activity, and is expected to be self-supporting.

      — Auxiliary enterprises bear all direct costs and, to the extent required under the University’s direct costing policies, a share of their own indirect costs, such as utilities, custodial services, and other maintenance and business services. —

      I seem to recall that the housing at UCD is managed by private contractors and that the rent rates they charge are set in the terms of their contract with UCD or UCOP (Office of the President), at least for the minimum. So they may have little room to modify rates downward. Changing the policy to allow more students per bedroom was probably the only thing they could do (and did) and I’d imagine that required some contract discussions with UCD.
      Bottom line: UC expects to make money on housing. It isn’t part of their core mission to house their students.

      Memo for quotes above: https://policy.ucop.edu/doc/3410196/AM-A783-1

      1. Ron Oertel

        Thanks, but we have NOT discussed this before – regarding what I asked in my comment.

        For the moment, I won’t challenge your comment regarding their desire to “make money” on housing, as it’s a separate point (and I’m also not sure of its accuracy). I’m not actually seeing that in your quote.

        I’ve got other stuff to do for now, but I’ll see if David responds, later.

  5. Ron Glick

    “Housing is considered an auxiliary activity, and is expected to be self-supporting.”

    But they could change the policy. The Governor claims to want to address housing shortages. He could start by building subsidized low cost housing at UC. It requires two things. A change in UC policy and money.

    1. Don Shor

      But they could change the policy. The Governor claims to want to address housing shortages. He could start by building subsidized low cost housing at UC. It requires two things. A change in UC policy and money.

      UC Office of the President, at the behest of, or acquiescence by, the Board of Regents, could change the policy. Governor has almost no sway over UC policy. The state funding of UC is less than 15% of its budget, and he is only one regent.

  6. Ron Glick

    I thought this was the most thoughtful article I’ve seen during the campaign. The responses were different but they all gave good answers. I was sad to see that nobody pointed out that the CC failed to take up the Affordable Housing provision in MeasureJ/D. Its another reason to vote no on D.

  7. Bill Marshall

    Re:  Alan M’s 6:32 post

    I see the problem to ‘affordability’… 790 SF 1 bdr/1 bath unit… WOW!

    I spent ~ 20 years growing up in a 2 bdr, 1 bath house, inc. kitchen, dining room/alcove, living room, 1 car garage… total = 850 SF… fit fine for me and my parents… felt  “roomy” enough…

    1. Bill Marshall

      I hope Alan was referring to a house, not an apt unit… would have to add some WOW!’s if 790 sf is the ‘new normal’ for anything less than a house.

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