The San Benito County Planning Commission held a well-attended affordable housing workshop at the board of supervisors’ chambers, May 11. The commission had encouraged attendance by affordable housing providers, developers, builders, and interested members of the community. After the commission and about 10 public speakers voiced their opinions and recommendations, the five-member commission directed staff to incorporate some of the suggestions into a resolution that would be brought back for a vote June 15.
Ray Pierce, owner of Pierce Real Estate and chairman of the commission, said the Hollister and San Juan Bautista planning commissions had been invited to attend, but neither showed up. He said he hoped that affordable housing groups and developers were present in order to give the commission a feel for the direction that might work. He said normally speakers would be limited to three minutes, but indicated there would be some flexibility, “…depending how things go.”
Byron Turner, county planning director, mentioned a draft ordinance that had been given to the commission, but is not available online to the public. He said if the commission were to move the present ordinance, minus any fees, which have yet to be determined, to the board of supervisors it would require 15 percent of all subdivisions of five or more units be devoted to affordable housing.
Before opening the workshop to the public, Pierce asked Turner where the 15 percent number came from, and wondered why not 10 percent or even 30 percent. Turner said the county had previously used 30 percent. He said if the commission wants it to be 20 percent or 10 percent that would be fine, but added that 15 percent was consistent with surrounding counties. Pierce seemed satisfied and opened the workshop to the public.
Arthur Soza who works for a nonprofit organization in San Jose and has been involved in affordable housing efforts in Santa Clara County, said it would be a good idea to seek insight from neighboring counties that already have affordable housing plans.
“Establishing an affordable housing program in San Benito County will open the doors to more federal funds and nonprofits that can assist, either through advice or low-income loans, or possibly, grants,” he said. In Morgan Hill, he said, if the first buyer of an affordable home sold the home it had to be sold as an affordable home. “I believe that affordable restriction stopped once it was sold, then started again with the new homeowner. So, the new homeowner had a 40-year restriction. If not, when you get to the year 30, that home would be sold 10 years later and the second owner could sell it as a market-rate home.”
Soza said the affordable homes built in Morgan Hill were equitable to market-rate homes. While there may be some cosmetic differences inside, he said it was hoped that the affordable homes had some features, such as granite counters or two-car garages like the market-rate units. He said it should be required that local developers and contractors be used. He said in San Jose it’s acceptable if a local contractor’s bid comes in five percent higher than the lowest bid. He said it keeps money in the county and provides employment for local workers.
Seth Capron, from Aromas, said he had gone through the ordinance and agreed that as a commuter community, there is not any housing for a significant percentage of the residents. He said the 15 percent level is too low.
“If you put something in place where a certain percentage of the houses have to be market-rate, for-profit developers can build those houses and make money on them,” he said. “The low income and very low income houses are a different story. It’s going to take subsidies or donations of land to make that feasible. We all want a vibrant community and we don’t want all our lower income employees commuting in from Los Banos.”
Capron said the income of nearly half of those living in the county moderate income and below, while 40 percent are low and very low. He said it might not be possible to build enough new units for them, but it is not desirable to have 100 percent above the moderate income level.
Marty Richman reminded the commission that at its last meeting he said he would look into some of the issues regarding affordable housing. He said he had no vested interest for or against the plan, but only wanted it to succeed because he lives in Hollister.
“I think we should do a fact-based program,” Richman recommended. “I’m always discouraged when everybody starts talking about affordable housing. The term is meaningless because when you look at the HCD (Dept. of Housing and Community Development) definition of affordable housing you have five categories of affordability. And it depends on how many people you have in the family.”
Richman wondered that if the county wants affordable housing how will it be defined.
“Are we doing affordable housing for median income?” he asked. “For a family of four, it’s $81,100. Or are we doing affordable housing for an extremely low income, with one person or 10 people in the family? To do a program, the first thing we ought to do is gather the inventory of affordable housing that currently exists in the city and county, and put it in those categories.”
Richman said once the inventory and categories are determined, then they should be compared to what the projected growth rate. He said by 2035 it’s estimated the county will have 92,287 people. He said the growth rate of affordable housing should reflect the two percent growth rate of the population.
Hollister resident and Regional Vice Chairman of the California Republican Party, Rob Bernosky, said that while the county does need affordable housing, one reason being that it is difficult to convince people to come to the county to work when they can’t afford to live in it, doing so through an ordinance can lead to negative consequences. He said when someone buys an affordable home, “…instead of getting a slice of the American dream, they get trapped because of mandates about what the property can sell for. It’s government-mandated housing.”
“Instead of passing an ordinance, I’d rather see the county give incentives for builders, or do it through zoning regulations that say in a particular parcel you can only build an apartment complex,” Bernosky said. “Mandating that the county will have so much affordable housing is just a disaster. It’s not going to get you what you want.”
He claimed that the 2007-08 economic meltdown was due to Community Investment Act, which he said mandated that financial institutions make loans to people who could not afford the mortgages.
“Please consider not having the council pass an ordinance, but do it through incentives for builders to accomplish the goal to have more affordable housing,” Bernosky pleaded to the commission.
Todd Dertscha, who said he had four years’ experience as an affordable housing developer in San Diego and Shasta County, told the commission that as long as an affordable housing program was balanced and fair there was no reason a developer shouldn’t want to be involved. He said having an effective affordable housing program means the county is trying to serve the needs of median to very low income people.
Alfred Diaz-Infante, president and CEO of Chispa, an affordable housing developer, was encouraged about the possibility of an ordinance and that 15 percent represented a good start, but could be better, comparing it to Monterey County and Salinas’ 20 percent. He said he did not see in the draft ordinance a breakdown of the 15 percent.
“The ordinance is a tool and there are other ways to create affordable housing, such as working with non-profit developers,” he said. “The ordinance isn’t going to get you to where you need to get to.”
Diez-Infante said the combined percentages for the three different income categories for the county is 57.7 percent, which he conceded would be difficult to reach without a combined effort of the ordinance and working with developers that build affordable housing.
Commissioner Dan DeVries asked Diaz-Infante what he thought was the best affordable housing concept, from a societal standpoint. Diaz-Infante said, “The most success has been the jurisdiction has an inclusion housing ordinance and then a developer will work with a non-profit and they will set aside property within that development for affordable housing.”
Diaz-Infante said this model is being used at Fort Ord, where two sites were set aside for affordable housing. He said he has seen this approach in a number of developments, mostly for high-density apartments.
DeVries wondered about the different income levels and how they equated to how affordable housing was defined. In particular, he asked what the very low income was for the county. Seth Capron told him it was $40,500 for a family of four and the median income is $81,100. DeVries still wasn’t clear what low or very low income were. Capron said low income would be about $65,000 and below. When asked where these figures came from, Capron said HCD established them. When DeVries still professed confusion how moderate income was higher than median income, Barnes compared it to the middle of a yardstick, which didn’t clear things up for DeVries. Richman asked to approach in order to further explain the concept and basically gave an allocution on the rationale of using median income levels.
Once again, Pierce asked Turner about the 15 percent rate. Turner responded that he had seen a wide range of percentages in other counties. Pierce said he didn’t want to get locked into 15 percent because of other counties.
“We’re a jewel in the rough. We’re our own thing,” Pierce said. He said there is a need to think of affordable housing as shelter rather than an investment to resell for a profit. “Once they’re affordable, I feel they should stay affordable, and they should be graduated in their value. There should be some way of determining a fair price without holding them down to an unreasonable low price. But they should always be affordable. The money is earmarked for that use and it should be a continued use.”
Pierce then said that the commission needed to get more input and the ordinance needed to be worked on some more. He then asked the other commissioners for their opinions.
Pat Loe said it was time to stop talking and, “…get these houses built. If it takes corner lots with duplexes, then that’s what we do. We’ve been studying this forever. I know government hates to make decisions, but if that’s what we need to do…”
Jeff Culler said he wanted to reflect further on the issue. Robert Rodriguez agreed with Loe that it was time to move forward and stop studying. DeVries reflected on Bernosky’s comment about incentives and wondered why affordable housing couldn’t have both incentives and mandates, saying he thought it was possible to have, “carrots and sticks in the same package.”
At the end of the two-hour workshop, Pierce asked Barnes how long it would take to implement points made during the meeting into the ordinance and bring it back to the commission for a vote and it was decided that could happen by June 15.