By David M. Greenwald
Davis, CA – The city council on Tuesday night will determine what the new “permanent” affordable housing ordinance will look like. Staff continues to recommend 15 percent—split evenly between extremely low (30% Annual Median Income), very low (50%), and low (80%).
While I think that’s entirely reasonable for infill, I think we should discuss whether peripheral and its ability to have land dedication sites should have a higher threshold.
As staff explains, in 2017 when Governor Brown signed a 15-bill housing package into law which included AB 1505, overturning the 2009 Palmer decision and restoring the legal authority of cities and counties to require affordable housing in rental development projects, it came with a limitation.
In the past, as staff explains, “the City of Davis was able to require that 35% of all units be made available as affordable housing.” At the time, “the economics of development were different.” Staff notes that larger projects were “able to take advantage of greater economies of scale due to the size of the project.”
Staff notes, “Land dedication for the purposes of providing affordable housing is much simpler on a large, multiacre property than on an infill project site.”
Staff therefore concludes “to require more than 15% inclusionary units, is both legally and practically difficult. AB1505 requires that the City of Davis be able to demonstrate that a project, constructed in Davis today, would be able to come to fruition with anything more than a 15% inclusionary requirement.”
So basically, 15 percent is as high as the city can mandate on what are essentially non-discretionary projects. Those are projects that council basically has no discretion over—such as anything now in the downtown that adheres to the Downtown Plan, for example.
Not only does the council not have the ability to go higher for those projects, it doesn’t make a lot of sense to do so, even if they could. And yes, the Builder’s Remedy has a 20 percent threshold for affordable, but the city’s 15 percent ordinance has both extremely and very low components, whereas the 20 percent Builder’s Remedy threshold does not.
At the same time, on the larger peripheral projects, the city could in fact demand more than just 15 percent affordable.
This is a point that a number of folks have made recently. One idea is creating a Measure J exemption for high affordable projects. Groups that have summitted alternative frameworks for peripheral housing including the students and Corbett’s group have talked about a 25 percent minimum for peripheral projects.
“The Council should require 25 percent for annexed land,” David Thompson recently posted. “As a city, we are knowingly planning to lessen the doors for the poor. A few more acres set aside for VLI and LI units would go a long way to being welcoming and inclusionary but not on the cards.”
Thompson noted, “When David Taormino asked me to do the affordable housing for Bretton Woods I said I would if he doubled the land required for affordable housing. David provided land for 150 VLI and LI apartments instead of the required 68.”
On a land dedication site, there are advantages in that the developer only has to provide the land to an affordable housing developer, usually some sort of non-profit. They can then tap into state and federal funding for affordable housing as well as grants and put together the funding needed to provide the housing.
This is what eventually happened at Creekside which became housing for those in danger of becoming homeless—though that came together over 20 years after Mace Ranch was completed.
Clearly, even on a few acres, an affordable housing developer can get the funding to put dense, low-income housing in place.
As City Manager Mike Webb pointed out to me, “15% represents the floor, not the ceiling, for discretionary project (which include anything under Measure JRD).”
He said, “(It) may be possible to go higher with land dedication depending on the project, but that will be up to a specific project review and DA, economics and land area.”
He continued, “The key to land dedication is density… to achieve higher unit count in a senior only complex where all the units are very small singles or very small doubles is fairly easy.”
But what happens if you want affordable housing for families? And you have to build more traditional 1-3 bedroom type housing—which could be apartment or condos or it could be townhouses or even detached single family homes—it becomes much more challenging.
That doesn’t mean we cannot go higher than 15 percent for such projects, but it does seem that the city wants to have that sort of discretion to decide.
As Mayor Will Arnold has put it as times, it’s a “balancing act.”
If you can’t build the project, 25 percent of zero is still zero. For every project not built, we get no affordable housing at all.
At the same time, if you leave the number at 15 percent as a minimum, many projects will simply stop there, say they met the city’s standard and call it a day.
My suggestion: set 25 percent as the target for peripheral projects with a preference towards land dedication sites. But give the applicant the flexibility to get creative and set 15 percent as the absolute floor.
I also, once again, would suggest that the council look into an array of options to avoid a Measure J vote altogether, that would include projects with high levels of affordable—I would say the floor there might be 40 percent with a certain percentage set for extremely and very low, so the applicant can’t satisfy the requirements with ADUs at 80 percent AMI.