September 1, 2017

San Jose Mercury News: Inclusionary housing law will create more affordable apartments


As the state housing package nears a vote in the California legislature, the attention of many housing advocates has turned to the necessity of inclusionary zoning as part of the solution to the housing crisis. SV@Home Board Chair Ron Gonzales and David Kramer of Blach Construction and the Silicon Valley Leadership Group’s Housing and Community Development Committee recently joined forces in an op-ed for the San Jose Mercury News making the case for AB 1505.

Read the original article at the San Jose Mercury News.

Opinion: Inclusionary housing law will create more affordable apartments

By Ron Gonzales and David Kramer

Gov, Jerry Brown and legislative leaders took the first steps toward addressing California’s housing crisis on Monday by announcing a “housing package” of bills that includes both funding for affordable housing and regulatory streamlining.

One critical piece missing from the package is AB 1505, a bill that would restore the authority of local governments to apply affordable housing production targets to rental housing.

As we have seen over the past few years, housing prices have risen to a level that is affordable to only those with the highest incomes.  This is impacting residents throughout the state, but the problem is particularly acute in the high-cost Silicon Valley.  It is the center of innovation technology and one of the most dynamic and productive regions in the world, but our economic competitiveness and quality of life are threatened if we don’t respond.

This is a top priority for business leaders working in close partnership with the City of San Jose. According to the Silicon Valley Leadership Group’s CEO Business Climate Survey, CEOs and corporate executives have identified housing costs as the top cost of living issue and the largest impediment to recruitment and retention of employees. We are strongly committed to inclusive neighborhoods and equitable developments that are accessible to lower-income households.

AB 1505, authored by Assemblymembers Richard Bloom, David Chiu and Todd Gloria, would restore an effective and time-tested tool for the City of San Jose and other communities that has created hundreds of affordable homes in past years. Known as “inclusionary housing,” it fosters inclusive neighborhoods by requiring that some of the units in new market-rate residential developments are affordable to lower-income households at a below-market cost.

For decades, local inclusionary housing programs have proven to be one of the most effective tools for producing new homes affordable to working families and creating strong, diverse neighborhoods with a range of housing choices. Nearly 170 cities and counties in California have adopted inclusionary housing policies as a complement to other strategies to address the affordable housing shortage.

Despite the long track record of the policy’s success, an appellate court decision — Palmer/Sixth Street Properties L.P. v. City of Los Angeles — created uncertainty for local governments regarding the viability of this important zoning tool.  While local governments can still apply inclusionary policies to for-sale housing, Palmer abruptly removed their ability to apply them to rental housing.

As a result, it is estimated that San Jose alone lost out on the production of more than 2,400 affordable rental homes that are critically needed in our community.

AB 1505 clarifies state law and removes the arbitrary distinction between rental housing and for-sale housing.  The bill does not require inclusionary policies or alter laws governing rent control; it simply allows the policies that have been creating affordable housing for the past 40 years to continue without confusion or fear of litigation.

As housing affordability moves further and further out of reach, local governments need every tool in their toolbox to deal with it. AB 1505 restores the authority of progressive and innovative cities like San Jose to adopt effective inclusionary polices as one of these critical tools.

Brown and the Legislature should include AB 1505 in the final housing package. It’s good policy and the right thing to do. A just, inclusive and dynamic San Jose will depend on it.

Ron Gonzales is board chair of SV@Home and CEO and president of the Hispanic Foundation of Silicon Valley. David Kramer is co-chair of the Silicon Valley Leadership Group Housing and Community Development Committee and Vice President of Pre Construction, Blach Construction. They wrote this for The Mercury News.

Photo courtesy of the Mercury News and Amy Sullivan/Sheridon Keith Photography.