Opinion: The time to increase affordable housing requirements is past due

Berkeley is in the throes of a significant affordable housing crisis and higher fees on market rate projects will help mitigate the crisis.

By Kate Harrison

Kate Harrison is a Berkeley City Councilman who represents District 4.

In the throes of a significant affordable housing crisis, the time for action in support of reasonable affordable housing measures is now, not at some distant point in the future as proposed by the authors of Friday’s opinion piece in Berkeleyside.

The proposal on Tuesday’s council meeting simply brings the City’s affordable housing requirements in line with two city-commissioned studies from 2015 and 2016. The proposed fees are still well below the maximum fees per unit that the 2016 feasibility study concluded could be collected without affecting the developer’s ability to make a reasonable return on their investment.

The proposed affordable housing requirements are not a tax. They reflect the impact on affordable housing specifically created by market rate housing. New market-rate housing creates additional demand for services provided by teachers, police officers, and, yes, the construction workers who help build housing. The alternatives to requiring reasonable amounts in affordable housing mitigation is either that these needs go unmet, requiring people to pay significantly more in rent or travel further for jobs in the urban core, or that the burden is shifted to taxpayers, landlords, and those with in-law units, all of whom already contribute to affordable housing.

The editorial’s primary critique seems to be that the studies are not recent enough to be used and that any increase should be deferred until another study is performed. Such a recommendation is surprising since it was the previous City Council, of which Councilmember Lori Droste was a member, which delayed issuing the nexus study for almost a year, and then took another five months to adopt affordable housing fees at a lower level than called for just as housing prices exploded.

Rents now are even higher than they were at the time of the studies. In April 2017, two-bedroom apartment rents averaged $3,644 – a 26% increase from the time of the 2015 study. Rents have increased 15% since the study was conducted on the very same rental units used in the 2016 study.

It is also a myth that an increase in the mitigation fee/increase in percentage of affordable units will slow development. The last time the requirements were increased development did not slow. In 2015, 11 projects either applied to build, were approved to build, or were constructed. In 2016, that number increased to 17.

A third point raised in the op-ed is that the fees being proposed in Berkeley differ from those in other cities. These studies by necessity take into account specific rent levels in each city. Cities such as Oakland, with lower rents, will have correspondingly lower affordable housing fees. As for San Francisco, the op-ed selectively looks only at city’s affordable housing fees while conveniently ignoring all of the other development fees (i.e., parks, transportation, child care, jobs-housing linkage) that San Francisco, but not Berkeley, requires of new developments.

The housing crisis is in fact a crisis of housing affordability. Even with all projects already approved, Berkeley will have met only 3% of the goal for low income housing (affordable at rents of $2,000 per month) set by ABAG and 4% for moderate housing (affordable for rent up to $3,135 monthly), compared to 141% for market rate housing. Rising housing costs result in massive displacement, including most notably a double digit decline in our African American community. In the last local election, Berkeley voters resoundingly rejected the argument that we can build our way out of the affordability crisis without specifically building affordable housing.

As the op-ed’s co-authors all agree, building more affordable housing is the best approach to preventing displacement. Professor Chappele notes that “subsidized housing has over double the impact of market rate units” in preventing displacement, while Professors Lens and Monkkonen conclude that “inclusionary housing requirements have a greater potential to reduce income segregation than bringing higher-income households into lower-income parts of the city.” Yet rather than act now, they would instead waste more tax payer dollars for a “do-over” study to reconfirm what every Berkeley resident already knows – we need more affordable housing and we need it now.

The proposed changes simply bring City requirements in line with the studies commissioned by the City, using standard industry practice. The index to reflect inflation is one commonly in use. None of these measures are arbitrary. I am asking my fellow City Councilmembers to join me in considering the evidence and prioritizing the best interests of our residents, our City and the planet.