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HomeMy WebLinkAbout7/11/2017 Item 1, Cooper Christian, Kevin From:Allan Cooper <allancoope@gmail.com> Sent:Tuesday, July To:Codron, Michael; Dietrick, Christine; E-mail Council Website; CityClerk Subject:HOUSING LAW AND POLICY FORUM OVERVIEW Attachments:107_11_17...housingpolicy.pdf Dear Michael and Christine - Would you kindly forward the letter attached below to the Council so that it can be included in the correspondence file for today's meeting? Thanks! - Allan 1 To: SLO City Council Re:Housing Law And Policy Forum Overview From: Allan Cooper, San Luis Obispo Date: July 11, 2017 Introduction Many residents in San Luis Obispo who work to preserve the quality of their environment support increasing the supply of so-called “work force housing”. This is fundamentally good for the environment as it could reduce long commutes in and out of our work centers . However the 1 City Council holds these same citizens hostage to a pro-ratio allocation system that supplies a paltry number of work force housing units in return for too many high-end housing developments and too many tall buildings housing mixed use commercial development. The late George Moylan, who served 18 years as the former Executive Director for the Housing Authority of the City of San Luis Obispo and its nonprofit affiliates, had correctly said that the private sector could never adequately address San Luis Obispo’s chronic shortage of work force or affordable housing. This shortfall would have to be primarily met through public assistance. Problem Identification The State - through a State-required regional housing needs allocation (RHNA) process - mandates that we, through our Housing Element, identify and address our existing housing needs. In this sense, the State is mandating that we address our jobs-housing imbalance because if we don’t we and the State will be burdened with increasing transportation infrastructure and air pollution costs associated with urban sprawl. But this mandate has become the private sector’s and the City’s “Trojan Horse” with which they can justify a 25% increase in our population from 46,730 to 58,626 by 2035 (and this in comparison to a 10% 2 increase in population which took place between 1990 and 2014). In exchange for providing affordable housing, the developer is exempted or deferred on a per unit basis all planning, engineering, building review, permit processing, development impact and water/sewer hook-up fees. In exchange for providing affordable housing the developer receives a density bonus, exceptions to development standards, city funded off-site improvements and even direct financial assistance. In exchange for providing affordable housing the developer receives reductions in parking standards, building setbacks and exceptions to limits on height and lot coverage. This statement is somewhat speculative as there is currently no way to determine all the 1 reasons why people choose to commute to their work in SLO from neighboring communities. And of course the days of "company towns" are long gone and we can no longer force people to live near where they work. Even live-work housing is questionable because of the transitory nature of employment these days.  The city’s updated land use and circulation element (LUCE) estimates the city’s population at 2 build-out in 2035 at 58,626. 
 I’ve heard that one Council member believes that growing to 58,626 by 2035 will do everything we want it to do: create workforce housing, create affordable housing and reduce commuting. But with a projected population increase of 11,000 or more people, we will receive a mere 220 3 more affordable housing units, a mere 22% increase over what we currently have assuming all new development capitalizes on City incentives. And these 220 units will become available to today’s 4,905 working households currently living at or below the poverty level. The wage 4 earners within these households work primarily in the food prep, food servicing, healthcare support, grounds maintenance and personal care employment sectors. In other words, our 5 Based on a U.S. census figure of 2.48 persons per household and based on the most hopeful 3 scenario that 5% of the housing built to accommodate these additional housing units will be dedicated to very low income residents (thereby making the project eligible for density bonuses, etc.) See: http://www.census.gov/quickfacts/table/VET605214/0668154,00 This may be a conservative figure and it is highly speculative. Based on U.S. Census data, 4 24.2% of SLO’s population is under 18 and over 65. This means 35,421 residents are working age or between the ages of 18 & 65. However, according to SLOCOG, only 6,700 of these 35,421 working age residents hold jobs in San Luis Obispo. The remainder are either students or retired residents. Census data also indicates (erroneously implying that our entire labor force reside in San Luis Obispo) that 60.5% of the population is in the labor force which equals 28,272 in the labor force. Subtracting SLOCOG’s figure of 6,700 workers residing in SLO, one can surmise that 21,572 of these workers reside outside of San Luis Obispo (SLOCOG estimates a higher number of 24,300). However, it is hard to determine what percentage of these 21,572 or 24,300 non-resident workers are at the poverty level and would therefore benefit from inclusionary housing located in SLO. So I’m not including a number for this demographic group. However, census data indicates that 32.4% of the population or 15,140 residents are at the poverty level. Dividing 15,140 residents by the average household size of 2.48 would mean that 4,905 households are at or below the poverty level. It’s hard to say what proportion of these 4,905 households (if not all) are rentals occupied by students who are supported by their parents or retired persons residing in homes or mobile homes they own free and clear. I’m assuming, however, that that number is equal to or exceeded by the unaccounted for number of out-of-town commuter households who are living at or below the poverty level SLO County data: sales earn on average $16.19/hr. and comprise 11.4% of the workforce; 5 food prep and servicing earn on average $11.34/hr. and comprise 11.1% of the workforce; healthcare support earn on average $15.33/hr. and comprise 2.4% of the workforce; grounds maintenance earn on average $12.75/hr. and comprise 4.2% of the workforce; personal care earn on average $12.76/hr. and comprise 3.4% of the workforce. These poverty level employment groups add up to 32.5% of the County’s working population. SLO City data is comparable in that 32.4% of the resident population (not working population) live at or below the poverty level. If one were to apply the County’s pro ratio of 32.5% to San Luis Obispo’s endogenous and exogenous working population of 31,000 (SLOCG’s figure) one could surmise that 10,075 workers or 4,063 working households live at or below the poverty level. This number is lower than the 4,905 households previously cited but the order of magnitude comparison with the scant 220 affordable housing units still applies. government programs that help developers build affordable housing will barely meet a fraction of the need. Doesn’t this sound like we’re “giving away the store” in the name of inclusionary housing? And given imminent cataclysmic climate change and its impact on future water shortages here in California, should the City now feel it is justified in pushing population growth beyond 1% per year between now and 2035 simply because our population growth over the past 24 years has averaged 0.42% per year? Even without considering the “water issue”, San Luis Obispo’s recent history of slow growth has demonstrably enhanced our quality of life through protecting the small town ambience and historical charm that most of us wish to preserve. Solutions Public housing, i.e., housing built by government directly instead of government giving developers incentives, should be the most favored alternative. We should not be dependent on significant population growth in order to provide a modicum of affordable housing. Instead of allocating $450,000 last year to a rental housing inspection program, this money could have been earmarked for the San Luis Obispo County Housing Trust Fund. Instead, the City should apply for HOME Investment Partnerships Program grant funds to address our local affordable housing needs. Instead the City should apply for Affordable Housing funds. Instead, more money the City receives from HUD’s Community Development Block Grants (CDBG) should be set aside for affordable housing . Instead, the City should put a stop, once and for all, to the 6 conversion of our existing housing stock into commercial properties. Instead the City should explore enacting some form of rent stabilization. About 15 California cities have some form of CDBG funds are allocated by the federal government to eligible local agencies for housing and 6 community development purposes. Within general program guidelines to assure that federal program goals are being met, San Luis Obispo County allocates funds to the city each year. The estimated CDBG allocation for the fiscal year of 2015-16 will be $405,000. The estimated CDBG allocation for the fiscal year of 2016-17 will be $365,000. Over the past five years the City’s CDPB Program has provided over $1,250,000 towards affordable housing and approximately $500,000 towards homeless services. Nevertheless, too much CDPB money is diverted away from the actual provision of affordable housing. For example, between 1994 and 2010, the City allocated $7.5 million of CDPB money for the removal of architectural barriers along streets and within private and non-profit low-income housing. Instead, some of this money could have come out of the Transportation Development Act (TDA) since pedestrian access is a form of transportation and could therefore qualify for TDA Article 3 funds much like the 2% required allocation of TDA funds for bicycle planning. Part of this funding could also have come out of the Tourism Business Improvement District Fund. Too much CDPB money goes towards administration, in other words towards maintenance operations and salaries and not enough towards capital expenditures. The City’s proposed operating subsidy to the CDBG Fund for 2016-17 will be $153,969. Compare this with Capital Improvement Plan (CIP) proposed expenditures of $105,000 for the DCBG fund (which is eclipsed by the operating or administrative costs). In addition, the City has awarded CAPSLO CDBG funds for design and engineering costs of a new Homeless Services Center in the amount of $125,000. Too much CDPB money is channeled into homeless services when more of these expenditures could come out of the General Fund. In fiscal year 2014-2015 the City provided a total of $74,767 from CDBG in funding support to our existing Maxine Lewis homeless shelter. For information on this topic see: http://slocity.org/Home/ShowDocument?id=7561 rent stabilization, including Los Angeles, San Francisco, San Jose, and Oakland. And instead, the City should increase its in-lieu fee requirement, paid by developers to meet inclusionary housing requirements. In conclusion, our “carrot” approach of luring developers with financial incentives is insufficient. Our leave-it-up-to-developers policy has failed to produce results because of innumerable imperfections in the “free market” for housing.