March 31, 2021

San Jose Spotlight: San Jose explores policy allowing nonprofits to purchase affordable housing


“We’re pleased that the city is pursuing a range of creative tools to respond to these dimensions of our current crisis,” said Mathew Reed, Policy Manager for SV@Home, a local affordable housing nonprofit. The Community Opportunity to Purchase Act, or COPA, could help prevent displacement by allowing nonprofits to purchase apartment complexes before developers or landlords.

BY: Lloyd Alaban┃San Jose Spotlight
PUBLISHED: March 31, 2021

San Jose could soon allow nonprofits to purchase apartment complexes before developers or landlords — a bold idea already adopted in cities like San Francisco and Washington.

The movement to adopt the policy, called the Community Opportunity to Purchase Act or COPA, began earlier this year during tenant rights workshops hosted by East San Jose nonprofit SOMOS Mayfair. The idea allows qualified nonprofits the first right to purchase a housing property up for sale before anyone else, which could ensure tenants will not be displaced. Once a qualifying property goes on the market and another buyer makes an offer, nonprofits under COPA will have the right to match the offer.

The city identified a COPA policy as one of its strategies in an anti-displacement plan presented to lawmakers Tuesday.

“Displacement is truly one of the biggest threats that we have facing our city here in the near future,” said Councilmember Raul Peralez. “I know a lot of people feel it’s inevitable with growth, but it’s not.”

Similar laws exist in San Francisco and Washington, with varying regulations on how much affordable housing must be provided at each property and how long it takes to purchase a property. San Francisco’s law, passed in 2019, has allowed nonprofits such as community land trusts—founded by community members who acquire and manage land—to purchase properties and prevent low-income tenants from being displaced.

This could be critical for the South Bay Community Land Trust, the first of its kind in Silicon Valley, which launched in 2019 with a goal of acquiring land and preserving it for affordable housing. But the trust has had trouble identifying plots of land, especially amid the pandemic, even after trying to convince the Santa Clara Valley Water District to donate some of its public land for low-income housing.

In Washington, which has earmarked $10 million annually for its program, properties must have at least five units for nonprofits to purchase, while San Francisco requires three. The lack of density and multi-unit buildings in San Jose compared to other big cities might be a problem, advocates say.

“There are a lot of duplexes that exist,” said Gabriel Hernandez, the program coordinator at SOMOS Mayfair.

SOMOS Mayfair held a workshop with residents earlier this month advocating for a COPA ordinance and plans on holding another late next month. The organization believes the policy would help the many low-income individuals in Latino-heavy East San Jose with high rent. “What we’re doing is having that discussion with the community to see what people think.”

The group has lobbied the city to draft a COPA ordinance, including potential incentives for property owners to sell to nonprofits, such as tax breaks. They also want to include other properties, such as mobile home parks, in the plan.

“We’re pleased that the city is pursuing a range of creative tools to respond to these dimensions of our current crisis,” said Mathew Reed, a policy advisor at Silicon Valley at Home, a local affordable housing nonprofit.

San Jose’s housing department has not yet discussed in detail what a COPA law would look like, or what properties would be eligible under a potential law. The city, however, is set to begin discussing a COPA law early next month through an anti-displacement working group, which includes members of several local community groups. City officials Tuesday flirted with the idea of looking for smaller multifamily buildings for nonprofits to purchase.

“We’re open to learning from other examples,” said Kristen Clements, a policy manager at the city’s housing department.

Considering a COPA ordinance is part of the city’s four recommendations to prevent displacement, which include keeping tenants housed during the COVID-19 pandemic through eviction moratoriums, creating a “preference” program for tenants, that sets aside a portion of affordable apartments for low-income applicants who live in high-displacement neighborhoods, and requiring the city’s housing commission to have at least one person who is either currently or formerly homeless.

The City Council unanimously approved the anti-displacement workplan Tuesday.