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Real Estate

Gov. Brown’s Hail Mary

GOVERNOR BROWN PROPOSES BYPASSING LOCAL REVIEW TO BOOST AFFORDABLE HOUSING

California Gov. Jerry Brown might just have given the state’s housing sector its biggest shake-up in a while with a proposal that could fast-track a major expansion of residential building, which could have significant impact here in the Bay Area. In his June comments on affordable housing, the governor pitched his approach as a rejection of more subsidies to solve what he says

is really a supply-and-demand prob-lem. The state needs more production “that will … bring down the cost,” Brown was quoted as saying in the Los Angeles Times. “Otherwise, through subsidies and through restrictions, we’re just spending more and more tax dollars and getting very, very little.”

Brown’s plan, if approved by both houses of the state legislature, would allow developers to skip most local reviews and proceed with their projects if they have at least 20 percent of the units affordable for people making up to 80 percent of the median income. In a state where there are many calls for more affordable housing but just as many people trying to prevent construction, that could be a significant change.

“For far too long, Sacramento has seen housing as a local issue even as localities haven’t kept housing development in line with housing demand,” Hoover Institution Research Analyst Carson Bruno told the Marina Times. “As the Legislative Analyst’s Office has made clear, the state’s housing crisis is from a severe lack of housing supply, so efforts to encourage supply development is a step in the right direction. That said, however, in its current form, I’m not entirely sure how drastic of an effect Gov. Brown’s proposal will have.” Bruno said the affordability mandate could limit the number of participating developers.

“One of the major items preventing housing development in the state, particularly in the coastal regions and especially in the Bay Area, is the political friction to development created by the NIMBY-residentialist movement,” said Bruno, whose research focuses on California politics and policy. “The irony, of course, for this movement is as they try to retain or preserve a neighborhood culture of the past, by restricting supply, the residentialist movement is, in fact, altering the culture by making the communities only affordable for the elite. While, generally, local control is a positive, on this issue, local control has clogged communities’ abilities to effectively remedy the problem. Gov. Brown’s approach removes some of the political friction that is preventing positive action and more importantly, as it currently stands, it isn’t a one-size-fits-all approach. It could definitely force communities to begin becoming part of the solution, rather than being roadblocks.”

Bruno calls it a “toss-up” whether Brown’s plan passes the legislature. “While some in Sacramento pay lip-service to the housing affordability problem, there still doesn’t appear to be a full understanding of the extent the problem poses for California. For one, housing prices have become the top cost-of-living concern for employees and top business challenge for Silicon Valley-Bay Area employers. This issue threatens the economic future of California’s most important economic region. This has major budget implications, also. If the Silicon Valley-Bay Area stumbles, so too do the state’s tax revenues. Until legislators see the connection between housing and the state’s economic and budget future, the urgency on the issue won’t be there.” He added that another challenge will be overcoming special interests that prefer the status quo.

“The housing situation is a crisis, so solutions need to be bold,” said Carson. “We need to be shocking the housing supply to make a dent in the affordability. All in all, the governor’s approach is still too tepid. But at least it is starting the discussion in Sacramento.”

JEFF KOSITSKY NAMED HEAD OF NEW HOMELESS AGENCY

On July 1, the city will have a new department tasked with addressing San Francisco’s homelessness problem. The Department of Homelessness and Supportive Housing will work to move people off the streets and into housing and get them connected with necessary social services. Mayor Ed Lee named Jeff Kositsky, the executive director of the Hamilton Family Center, as director of the new organization that will try to reach Lee’s goal of permanently transitioning at least 8,000 people out of homelessness.

Kositsky has decades of experience addressing homelessness, including helping homeless and especially families with school children escape the street and in leading a nonprofit affordable housing developer.

WIENER SEEKS HIV/AIDS RENT CONTROL EXPANSION

San Franciscans living with HIV/AIDS and who receive federal subsidies through Housing Opportunities for Persons with AIDS would fall under an expanded rent control ordinance if legislation introduced by Supervisor Scott Wiener in mid-May passes the Board of Supervisors. Currently, according to Wiener’s office, HOPWA recipients living in rent-controlled units can see their rent increased to market rate at any point.

“It makes no sense that just because you receive a subsidy to help you pay rent that you don’t have the full protections of rent control,” said Wiener.

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