January 11, 2019

Mercury News: ‘I want to see the Valley step up:’ Gov. Newsom pressures companies to help build housing


Silicon Valley at Home (SV@Home) Deputy Director Michael Lane weighs in on Governor Newsom taking the lead in directly addressing the housing crisis his first budget.

See the original story at the Mercury News

‘I want to see the Valley step up:’ Gov. Newsom pressures companies to help build housing

Thursday remarks follow release of Newsom’s first budget proposal

By Marisa Kendall | mkendall@bayareanewsgroup.com and Katy Murphy | kmurphy@bayareanewsgroup.com | Bay Area News Group
PUBLISHED: January 10, 2019 at 3:25 pm | UPDATED: January 10, 2019 at 6:10 pm

Gov. Gavin Newsom on Thursday called on Silicon Valley companies powering the state’s economy to step up and match the money he intends to set aside to build workforce housing, in an effort to ease California’s housing crisis.

Speaking to reporters after unveiling his first proposed budget as California’s new governor — which earmarks $500 million for the creation of middle-income housing — Newsom said he expects “corporate California” to help build the state out of its housing shortage.

“I want to see the Valley step up and match our contributions,” he said. “The workforce housing issues have been exacerbated by the success of a lot of these companies. I do not begrudge other people’s success, but that success has created burdens and stress, and we are doing our part, and I would be asking them to do their part to amplify our efforts, to match those efforts and to increase our capacity to deliver.”
Newsom did not provide specifics on how he would get California companies to cough up that money, but he said he already has been having “quiet conversations” to move his plan forward.

In all, Newsom’s proposed budget includes $7.7 billion to address housing and homelessness. He intends to give grants to encourage local governments to build housing, expand the state tax credits used to fund affordable housing, use state properties for affordable housing development and do more to hold cities accountable when they fail to meet their state-mandated housing goals.

Carl Guardino, president and CEO of business-backed public policy and advocacy organization the Silicon Valley Leadership Group, welcomed the governor’s challenge to local companies. “It is serious money,” he said. “And we have a serious need, with employers seriously concerned about it. So I think the timing is right.”

But while California companies have an opportunity to play a role in relieving the region’s housing shortage, they don’t have a responsibility to do so, Guardino said. That’s because the problem isn’t their fault.

“What we want to make clear,” he said, “in the next economic downturn, jobs are no longer going to be a four-letter word, as they seem to have become.”

Guardino said his group, which counts all the Valley’s big tech companies among its members, also has been in talks with local companies, coalitions and foundations about investing in housing creation. He said he expects announcements about specific commitments to come soon.

Facebook and Google, both of which are expanding their campuses, declined to comment on Newsom’s budget remarks.

Affordable housing advocates for years have been pressuring and cajoling Silicon Valley companies to do more. Cash-flush tech companies that flood the region with high-paying jobs and bring in new workers often are blamed for the shortage of housing that has choked the region and driven home and rent prices sky-high. Here and there, companies have been chipping in to address the problem.

In November, Cisco, LinkedIn and Pure Storage donated a total of $20 million to nonprofit Housing Trust Silicon Valley to build affordable homes. Cisco pledged $50 million to fight homelessness in Silicon Valley in March. Meanwhile, Facebook has raised nearly $20 million for affordable housing through its Catalyst Housing Fund, and Salesforce has made several donations to fight homelessness in the Bay Area. Google is planning to include up to 8,000 homes on a new campus in the North Bayshore area of Mountain View.

While those efforts have been piecemeal, Newsom’s words on Thursday may bring more companies to the effort, said Michael Lane, deputy director of affordable housing advocacy organization SV@Home. And it’s not just Newsom’s words — it’s also the $500 million set aside for middle-income housing. Companies likely will be more willing to invest once they see the cash Newsom already has put forward, Lane said.

“To have the state step in as a strong partner with a new governor, I think that sends a strong signal,” he said.

Lane said he’s excited to work with the Newsom to address the shortage of housing, which Lane called an “existential crisis” marring California.

“This is the most exciting budget around housing,” he said, “that I’ve ever seen in my career.”

Rufus Jeffris, spokesman for the pro-business Bay Area Council, agreed, and commended the governor for his interest in reforming some of the hurdles that restrict housing development, such as building fees and environmental regulations.

“Businesses absolutely want to do their part to help address California’s housing crisis,” he wrote in an email. “They also want to see meaningful progress in fixing state and local policies that are largely to blame for creating that crisis over many decades.”