Nov. 6 2013 08:30 AM

Bold move on affordable housing follows Barrio Logan vote

Jan. 2013 by Rolland
Myrtle Cole
Photo by David Rolland

We were rough on District 4 City Councilmember Myrtle Cole during and after the election this past spring. We won't forgive her for her disgusting campaign tactics against opponent Dwayne Crenshaw, but what's done is done, and there's no going back. And since she's been on the council, the city's elected Democrats have been a cohesive unit that hasn't backed down from its progressive policy goals in the face of considerable pressure.

Recently, they held their ground on a reasonable compromise on an update to the Barrio Logan Community Plan, despite a looming referendum from the shipbuilding industry, and on Monday, amid threats from the city's business and construction lobby, the Democrats finally managed to raise what's long been known as the "linkage fee" and is now called the "workforce housing offset"—a fee that developers of commercial buildings pay into a fund that helps finance affordable housing. The idea is that commercial growth creates a certain number of low-paying jobs, which in turn generates the need for affordable housing.

Kudos to the ballsy staff at the city's Housing Commission for proposing what Independent Budget Analyst Andrea Tevlin called an "aggressive" fee increase. The proposal was to raise the fee from 1.5 percent of 1990 construction costs to 1.5 percent of 2013 construction costs—a defensible goal but a jarring change. The fee was established in 1990 and, by law, is supposed to be increased regularly; instead, it was cut in 1996 and hasn't been hiked since. We surmised that the Housing Commission was going big and bold so that a compromise for a reduced increase would still be significant; when Tevlin suggested a less aggressive increase, we assumed the council Democrats would go along.

Not so. Councilmembers Cole, Marti Emerald and Sherri Lightner, Council President and interim Mayor Todd Gloria and mayoral candidate David Alvarez went for the big hike, compromising only on a relaxed phase-in period and exempting projects that are already in the pipeline. The council's four Republicans, including mayoral candidate Kevin Faulconer, voted no.

The Republicans parroted the rhetoric expressed by opponents of the fee increase—that it's a job killer. Of course, anything Republicans and the business lobby don't like is called a job killer. The way to create affordable housing, they say, is by reducing the cost of doing business, which spurs growth in high-paying jobs, eliminating the need for housing subsidies. By their logic, because the fee has been so low, there should have been rampant high-paying-job growth in San Diego and little need for affordable housing. That's not the case—a point Cole made emphatically on Monday, pointing specifically to a lack of economic development in her southeastern district.

As Joshua Emerson Smith reports here, there's pretty much universal agreement that the market hasn't created the economic conditions where affordable housing isn't necessary. According to the Housing Commission, there are 45,000 families in San Diego on a waiting list for partially subsidized housing. 

Fee-increase opponents in the business community say developers shouldn't have to bear the whole cost. But when it comes to the search for solutions, these folks are nowhere to be found—that is, until their bottom line is in peril. 

Since the proposal to increase the fee gained steam, briefly, two years ago, some of them have been suggesting tacking affordable housing onto a potential, nebulous, omnibus infrastructure bond measure. We have no problem, in principle, with using general-purpose public money to fund affordable housing. But that bond would have to be paid back, and since San Diego has no extra money sitting around gathering dust, taxes would have to be raised. Maybe San Diegans are willing to pay more in taxes to fix roads and sewers and whatnot—maybe—but you start adding more stuff, like affordable housing for other people? Yeah, good luck with that.

The City Council opted for the linkage fee in hand rather than the bond measure in the bush. Now, opponents are likely to sue, arguing that there's not a strong enough nexus between new commercial developments and the need for affordable housing. Gloria said he's confident it will pass constitutional muster. We hope he's right.

In any case, we're encouraged lately with the council Democrats' willingness to use their majority for the benefit of folks who need their help the most.

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