To kind of navigate the the real
estate market and we think it's
a it's a good place to be it's a
good space to be in because it's
it's an affordable space and
it's also --
A very sustainable space --
Once you get the formulas down
so I'm gonna quickly go over a
couple projects were doing --
Just to kind of show.
The concept and then I can get
into my opinions on my car
housing in Michael can you hold
the microphone close enough yeah
sorry my arm is a a little.
Got on my own microphone stand --
Okay so here we go this is --
A property we are currently
developing in Logan heights --
It's seventy five hundred square
foot lot in which we are able to
get municipal code.
Legally what.
I'm special permissions right
twenty one it the the lock was
to seize on law and it was
really only allowing five units
to be built.
And so use and density bonus and
then we use an FAA are bonus to
squeeze in twenty one small
apartments which would have
normally been five large
apartments --
And that's gonna house twenty
one people this specific project
we are.
Really hoping and we're we're
targeting --
Specifically --
X. homeless veterans who hold
the veteran voucher from the VA.
Okay and then --
Another one we're doing --
This one is an escrow on of a
lot that's about fourteen
thousand square feet --
Were able to fit forty two of
these micro units on this
property --
The normal allowance for this
would have been fourteen large.
Town homes or apartments so you
can see are maximizing the dirt
to fit as many houses as we
cannot even other small.
So -- So --
She's my little assistant.
So -- So
that tech kind of give you an
idea of what we can do with each
size of what --
And also to know these are half
market rate and half of them are
deed restricted we're working
with any of housing commission.
In order to do waste --
Mixed use contact with just on
chorus -- I
can show you what we could do if
that say we had unlimited money --
This is a one acre lot also in
Logan heights and we would be
able to if permitted and funded.
Bill three hundred of these
units and this would be more of
a permanent supportive care
housing facility --
This property --
At of it's been in and out of
Esther a bunch of times the they
keep calling us --
And the reason is because the
affordable developers can't
close on the deal due to the
financing. For some reason they
can't get their financing --
So that's something I would love
to tackle it's it's an ambitious
one who knows maybe we'll get
there okay.
So just kind of cap over at this
was -- I was
showing this to the home a
select committee kind of showing
how much dirt we need to go how
many units so on seventy five
hundred square feet we are able --
To fit twenty one units.
Fourteen thousand square feet
forty two units and if you give
us an anchor we can fit over
three hundred units in this is
all housing people --
And so that's kind of confusing
idea of per square foot what we
can build --
So the the construction we're
using is a modular construction
we're choosing to you shipping
containers --
There's other types of modular
construction they're sticking
brick modular there is metal
panels much of those concrete
paneling modular --
And the benefits of these at
this that they're built in
factories off site and then the
units are are fully furnished
and then delivered.
And then we just place them on
site with crane and there you go
there's your there's your unit
your apartment --
Some of the benefits of this is
this.
Speed is an obvious benefit --
Because it allows for the
development to could be going on
while you're also being
permitted for your site control.
And these things are approved at
state level so the city doesn't
take the permitting liability --
The state does and then is
delivered in all out.
Twice what it would take to
build it sticks and bricks on
the site --
Another cool factor this that we
didn't know.
Was that if we are forced to use
prevailing wages which a lot of
portable buildings are and and
that's a good.
Good thing to be using --
One of the challenges with
affordable development is that
there's such expensive
developments --
Typically in affordable
development will cost four
hundred thousand dollars per
residents delivered --
We've been able to deliver ours
were we think we're gonna do
four hundred and forty thousand
actually might even do it for
less -- But
on the affordable side the
prevailing wage costs is cut by
a third because most of the work
is being done off site in the
factory.
So -- That
will help affordable developers
with their bottom line --
Also cool part of is that the
its its warranty it's similar to
a cars so.
If something goes wrong you know
who who to call --
So that's what we're doing.
So this this.
Power point was really geared
toward homelessness so I'm going
to quickly go through this
because we are aye I'm on the
board a path connections and so.
That's kind of where I focus --
Our efforts --
Most skip this one so what we're
trying to do is rent to homeless
people and partner with service
providers by using a masterpiece
meaning instead of renting each
unit -- One
at a time we are hoping to rent
the entire property --
Under master these which for a
landlord that means one check
and for the service provider.
That means they've got a whole
property in which they can run
their services we also don't
need a conditional use permit if
we do a master lease --
And that's also another benefit
of master leasing versus doing
permits support of care --
It's a much more streamlined
process --
This is the master leasing I was
talking about so happy landlord --
Makes it simple.
So.
This is the strategy here serve
of basically there's some
strategies for mass releasing
because the the service
providers need service money and
they also hold liability because
their clients --
They can't be the landlord to
their own client so we have to
have a property manager in the
middle and then the owner.
And that's the structure of how
you master these so the service
writer rents pays the manager
the manager in the landlord.
Manage the property for the
service provider --
And so.
Service money is a big deal I
don't know if this is the right
panel to be speaking about
service money on but I will tell
you the almost service providers.
Really needs service money in
order to be able to rent from
typical landlords the concept is
if we can build this thing so
can any other builder and that
opens up a new.
Supply chain for service
providers who need housing for
their outgoing --
Clients --
X. almost people that are in
care -- And
so the service monies really
important right now the service
providers really need about ten
thousand dollars per client
every year.
Plus the rent money in order to
have a successful --
Non reoccurrence of homelessness.
So and that solutions lesson so
far one of the things about
micro housing --
Is that --
Really helps the middle income
level --
What we see in San Diego as we
have all these houses that a
three bedroom two bedroom three
bedroom two bath houses?
That -- Are
still does roommates --
I know I was one once my brother
is one and and and people are
even families your even
cohabitating --
Where there's the you know
single parents sharing a house --
Two separate families and so
with this micro housing concept
really offers that we haven't
seen in San Diego.
Is that roommates now have
another option.
So instead of renting a room and
sharing a hundred or two hundred
dollars more a month you get
your own apartment --
Your own bathroom your own
kitchen cinnamon stealing your
leftovers I know that was I was
always the problem for me.
And and your own pocket so --
It really does.
Fill that need --
And so but there are challenges
and so my partner is going to
speak to some of the challenges
we've had some financing
challenges of their concept
because it is mixed use market
rate.
Deed restricted a sorrows as a
commercial space --
And so all that him touch on
that.
Okay [inaudible]
Right.
Thank you Michael on as that
takes over if you need to take
off we understand you thank you
so much of it as you dogs
extremely well behaved very
impressed with.
Demanded housing development
skills thank you she's much more
professional than me yes --
I'm my name's Doug arms I'm
going to see if you all don't
mind.
The more comfortable that way --
My Michael's partner in --
Makana properties and I've been
and developer builder and San
Diego for thirty plus years now
so I have.
A great deal of experience in
non affordable housing.
Building and construction I met
up with.
Years ago and you tell me what
it was doing in the affordable
housing space and I got really
excited about it so I partnered
up with him.
And here we are today.
So we've we've come up with the
concept --
Of he didn't he didn't mention
this bed were worried needed
mission were using the modular
housing.
Another piece of our model is
that.
We're really seeking no public
financing so.
Our project is under percent
privately financed and we
believe that.
With the efficiency of the
construction method for the at
the container units both in
terms of entitlements and
construction.
Paired with the private
financing model.
We have a very.
Viable solution to putting a
dent in the affordable housing
crisis that it's probably better
than most because our time from.
Property acquisition to
completion.
We are targeting less than a
year.
Which is pretty impressive --
Michael talked about the pastor
least being.
Concept --
Service provider or some other
[inaudible]
Writer --
I'm gonna talk about the
possibilities of not getting the
masterly switches which you know
where we're kind of learning as
we go.
Because it's such a novel
concept --
We don't know for gonna get
master these or not still all
our alternative.
Our water are there.
We have some problems in our of
alter are took his his me of our
alternatives --
So are a project requires no
public financing.
Were currently working with the
housing commission to read
restrict but technically we're
not required --
To we are passionate about
affordable housing and we want
to make this an affordable
housing project.
The housing commission for the
S. R. O. S. R. O. units.
Is providing a voucher rate
rental --
80% of area median income.
Which is which makes the prop
economically feasible.
IBM is is that permanent lenders.
Don't land on tenant based
vouchers there's going to look
at the market rate [inaudible]
So.
In order for us as an incentive.
To make this an intolerable
affordable housing project.
We're trying to work a system
out with the housing commission.
And the city of San Diego
council to come up with a way.
To essentially guarantee --
As a voucher rate grant for all
of our units Doug I'm very
started wretched there may be a
problem with that particular
microphone would you mind using
the wireless one okay okay.
If you -- So.
So what we're trying to get a
day rental guarantee on the
battery units in order to
incentivize as to not make to to
make that the project affordable --
The current no for is.
Available to the San Diego
housing commission --
Really.
Don't we don't have any
opportunities in those no phase --
The way they are structured now
to get any subsidies.
From San Diego San Diego housing
commission so what we're really
doing.
Is appealing to the city of San
Diego.
Council in mayor to come up with
another funding source to
subsidize our vouchers.
At if we don't you know we do
there are options are going to
it and entirely market rate.
Project and you know maybe
having to step out of the
affordable space.
So our theory is this the
housing commission right now is.
Paying --
Current SRO owners.
Quite a bit of money to extend
their as sorrows for another ten
years --
When we're offering? Twenty one
brand new as sorrows into the
housing stock.
In our only request is that we
get some sort of voucher rent
subsidy.
So we're thinking that.
If we push hard enough we can
probably get make make a
solution out of that --
The concept is scalable if we
are able to get through our
financing hurdles.
We could do this we could put
three to four hundred units.
On the street in the next two to
three years and which is far
ahead of your typical.
Tax credit.
Affordable housing developers so
we're really excited about the
concept.
And we'll have to see where it
goes.
Thank you dot org of what
transition out of Mister gentry
for going to secure nay --
We think your patience while we
took care of Michael on the
child care needs that I know you
understand that kind of stuff --
Problem around Todd in.
The streaking of the weather.
Is one of the good folks at
recruited me and brought me here
ten years ago.
Rain is fine --
Let me.
Set a little bit of a a
perspective here on the nature
of the problem well we've got it
for the missing metal that is.
And instrument hope the dog that
well we're working on with you
and mark we can make work out.
There sure is taking money that
flows down.
In vertical streams with.
Rooms and and regulations and
restrictions attached to it.
Which makes me think about it
and nobody in their right mind
going hand on order and
taxpayers money.
Local government officials
without some strings attached to
it they're just not going to
happen.
Initial making sure the the the
the attached requirements.
Are dapple adaptable enough to
fit local circumstances which
may not always fit.
Then is out of the funding
trains in this part of the
mission here.
In a large room or broader sense.
This whole issue of housing
commission was set up nearly
forty years ago. To serve the
housing needs primarily people
who are low and moderate income.
And that's typically low income
is typically defined as 80% of
median whatever.
In our most all of the money
that comes in to us is for folks
that.
Income level or lower.
Most Mister over 50% of median
or less some.
Begin in the homelessness
Arambula.
Or elderly and disabled folks
30% or less.
Of reach of those are the name
for a subsidy --
Addition in order to make the
the economics work.
The issue is what happens when
you get into folks in the middle
income range.
Which is typically defined as
about depending on their own
circumstances.
Number.
Of a that --
With those people --
Which creates a problem let me
give you an example.
If you go back about eight years
ago.
In the middle of the Great
Recession.
The housing commission which
among other --
Programs under that bridge about
thirty seven hundred and as hard
and it's of housing --
Which have Reyes of degrees of
subsidy attached to it.
We had a turnover rate of about
35% per year.
So over a three year time period
would you won't turn over the
inventory.
People have something new.
To in one of the server running
is a plan to the Great Recession
is over a lot there was a lot of
naturally occurring affordable
housing developed.
And available back then.
When I moved to Tara biggest
housing problems for closures?
We had more housing bills and
then then the market could take
care.
So the issue background 35%.
The turnover rate right now no
units.
This 14%.
It takes seven noted Turner
product inventory over for
people to move up and out.
As you can you can do the math
on that the difference between
thirty five and 14%.
Is a man's a paper to have a
place to move.
To are you going to the private
sector about compassion from for
conventional run apartments.
Is 50% a year.
So what it tells you the people
that can afford to market place
can move they can move up and
out.
Of people who cannot afford that.
Cannot.
The jump in the price tag is
just too big.
Let me give you numbers the
numbers just illustrates.
In San Diego right now the two
bedroom apartment rents for
about two thousand two hundred
and seven dollars.
That comes from a rich study
done in October of this year.
But I household earning 80% of
the area median income.
Which is 770-008-0050 dollars
for a family of four can afford
to pay using 30% should.
Can afford to played one
thousand six hundred and seventy
three dollars per month.
After you take out an eighty
dollar adjustment for typical
mentally utilities.
That leaves a difference of five
hundred and thirty four dollars
per month.
With a lower income hassle can
afford.
In the market rent for two
bedroom apartment.
And the so there's there's
nothing this plus the metal
between that affordability
number.
It we'll the family can afford
to pay.
Because virtually no production
a middle income housing in that
time period. For the period.
200-010-22000.
Seventeen the city of San Diego
produced.
Only. Thirty three units and
that's what I mean two digits
three three thirty three units.
Of middle income housing.
In that time period.
Ins in seven years personal
population one point three
million people.
As is obvious this lack of
supply --
Moderate income housing.
Affects the the city's market
place to attracting key people
who are --
Necessary folks but don't have a
great deal of income.
People are teachers first
respond or social services folks.
The need of a sentiment parleys
and sexual to the economy.
We cannot afford the rent and in
this gap is where we come to
carve the missing middle --
This last year of Mister Gloria
some assembly member Gloria
someone call you city council
member.
The assembly member Gloria --
Introduced AB.
Sixteen thirty seven a state --
Bill which the governor signed
to learn October of last year.
Which allows. To which initially
allowed to public housing
agencies in the state.
Both last June San Diego and
also Santa Clara county.
Who -- Try
this intentional so stroller
developers image don't come
developments where there was a
mixture of low income and
moderate income folks in the
development.
And the center county San
Bernardino letter themselves of
this makes this year as well.
So now there are three
localities here in California.
Trying to make this thing work.
And one of the difficulties in
it is --
Well when promised me set this
up. For very good reason.
Eserver would not use any of the
subsidies for the lower income
people.
There are many properties work
for moderate income people.
You know to cannibalize one sort
of programs in college.
We're sort of problems for very
poor people help those were in
the middle.
Make their own way.
And it means that we the the the
the guy is.
Wearing an experimental time
period now. To try to make this
thing work --
Will also introduce a second
bloom -- A.
B. twenty three seventy two of
the casa act.
Which will help to address the
same issue.
And what of we're going to be
doing is trying to figure out a
way to make.
Of the production missing that.
The meme got too many pieces of
paper homeowners.
Aimed steady the the housing
commission produced last year
like to refer you to is what I'm
a give you a website address for
the housing commission.
Is WWW dot S. the H. soon for
the same vehicle housing
commission.
Dot org or just Google us.
Well the stuff on the website it
is a good.
One we produced a study by the
mackenzie folks in September.
Seventeen that --
Identified.
Goals for the city of San Diego
needs to produce in terms of new
housing units.
Over the final in ten years at
all income levels.
This would brown from
200-018-22000.
Twenty eight and then it showed
that we need to produce in order
to keep up and or catch up
[inaudible]
With.
Normal projected population
growth.
You need to increase our housing
stock --
Anywhere from a hundred and
500-002-20020 thousand units of
housing.
Over the next ten years.
That means we need to produce
between.
Seventeen thousand new units of
housing to keep up.
And twenty four thousand units
per year to catch up.
Over the next ten years.
The largest number of housing
units so we produced in San
Diego for the last five years.
Was [inaudible]
Six thousand four hundred well.
The cost of Transoxiana higher
over the last few years.
Supply simple supply and demand.
The more demand is less ride.
Coasters up.
Who gets pushed out of the
bottom and who's missing in the
middle?
This report of one out of one
ahead to show that this is a
solvable this can be dealt with.
If there's no will to do it.
In fact the study points out
five different areas to those in
the study that I can going to
run to a bed.
Was this the the housing can be
produced.
The was always is going to be
for those however who cannot
afford the market place.
Had a make up for of of what
doctor very well a few minutes
ago.
The gap financing to bridge
between the missing level --
Income rise and what they can
market place.
Thank you.
Thank you Mister gentry --
It will --
We have.
You know a stickler for time
restaurants president I which I
keep these things going right --
So I wanna make sure we get to
our second panel but just
perhaps of a couple of points
and I appreciate it --
Michael's comments about almost
as babies slightly disconnected
from the discussion today about
working and middle class housing
but I want to just be very clear
I think they're very much
connected and that our inability
to build.
Middle income housing is pushing --
Folks up full time jobs into
units of adorably be occupied by
folks with far more modest means
and means of those units are now --
Pushing almost people out on the
streets right this is
dysfunctional housing economy
that we have --
That's you know meant most
obviously manifested by are
homeless but also speaking to
what Michael mentioned about
families doubling tripling up
and you know young adults dean
in a roommate situation much
being played out across our
community are I think seen and
unseen every single day.
And so I do appreciate the
inclusion of the discussion of
homelessness and today's
conversation is very focused on
a higher economic class --
But a very much related all of
us are tied up into this housing
crisis and all of us have a role
to play in fixing it.
Up if if I can't --
Just a couple questions for Doug
with your on the proposal's
these are great slides I think
of vision of what the future may
look like.
In a world where we need to
build a second amount more
housing at a lower cost --
Where you at a with --
This particular project in terms
of the the development process
sure -- We
are -- We're
almost entirely there were there
designed were anticipating
submitting to the city for
building permits and a couple
weeks --
Which for their container type
projects --
The city approval.
Is pretty much just the
foundation site plan utilities.
And the the whole modular
portion of the building is state
approval so Senate discretionary
review by the city council no
playing video.
We're not asking for any
variances in it's just pretty
much a straight a building
permit.
So for Californians it think
that this is somewhat exotic
this completely fits within a
lot of the code and is a fairly
normal that's kind of our model
is our our entitlement process.
If this had to go through DST
and and and the building
department this is a six month
ordeal --
Because the billing department.
And then it it will still go
through DST but we've already.
Submitted for a preliminary
approval through them.
And gotten very positive
feedback and they they frankly --
Deferred a lot of their review
to the housing commission
regarding the S. R. as but so --
Or intent when for design --
But our entitlement time we're
estimating maximum the month
month and a half while yeah.
And then and then construction
time on top of that.
Because of the containers one
level is dropped in one day.
So our our can total
construction time for this
project is probably four months.
Total while --
But in the end you have to be it
I develop expert understand a
quick.
Right with all with all went.
To that would take longer than
that right yeah --
In in I guess what's excited
that that is there's we trying
to grapple with the size and
scale this particular problem.
The need for innovation in the
space pretty obvious in this
seems like innovative solution.
But it does fit well within
existing regulatory environment
I mean yes you need it AB.
Sixteen thirty seven five to
work in this space a little bit
but on the whole the distal
existing develop a code supports
this development it does I mean
are.
We are are well within the to
the the zoning code flora ratio
it's after it center center so
where are.
You know.
The end and being privately
financed also frankly is really
expedites process if we had to
apply for public funds and and
wait around for that.
It would it would kind of
Brecher model --
Set is so the key to our problem
as I said really is.
Figuring out a way to get
permanent financing on the
project.
And committing to and affordable --
Model got kind of an of perhaps
you the video at the live stream
right now that.
This is happening here but it
could happen in their
communities --
To there are I think that
there's and the couple projects
in LA and people are are are
kind of getting yeah.
I don't know if they are quite.
Using the S. R. O. model that we
are.
I guess our Ozer differently
defined India in every
municipality --
So but yeah that the word is is
getting out okay and then just
there was the comment about --
With reduction the Costa
prevailing wages but the point
is is that you still prevailing
wages on the onsite work correct --
We're not required to and and
less we take public subjects
take some public substance
correct it if you did you what.
If we did --
Are at the impact of prevailing
wages to us is substantially
reduced because most of the work --
Is done in the factory with the
pre fab containers but the work
that would be need to be done on
site which would.
Fall under that.
The yeah they've got the work
done Ste wage if if we if the
project were were preventing
which brought understood.
Exciting stuff appreciating is
to very quickly the network --
Need to possibly on the next
panel --
This yet you we did some good
work together I think. Sixteen
thirty seven twenty three
seventy two any ideas you know
part of the the the deliverable
from this hearing is intended to
be legislative concepts that we
can --
Introduced practice it is next
Monday I'll give us more time
that but anything right now that
you can.
Maybe identifies areas that we
should work on in the new
legislative session.
Of the cans are roses making the
numbers work making the money
for that.
And I think is right to go to be
mixed income housing with
different Stratotanker homes.
And multifamily setting there
will be huge making around the
system works --
I think the everything that can
be done to lower construction
cost chambers Mister home just
mention it is wonderful.
To but I think that if there's
gonna be a gap.
The problem now gap in money.
There's a need to fill that gap
and think mixed income where you
get different income strat in
the same property.
Is largely going to be a way
that works out.
Agree provide some form of
redevelopment and to provide you
some state.
Investment in these projects --
Remains be seen how we
necessarily fit better finance
that the state has its own
budget -- To
but it is a lot of energy --
In the assembly caucus to do
that -- We
had a bill this past session was
not successful --
But was a pulmonary attempted
this and I said I would welcome
eternity gentleman's input on
what that should look like in.
Twenty nineteen it's really the
audiences well --
I'd no doubt the bill be
introduced and what form it what
details may be seen and making
sure that we eliminate the
excesses of the past in the in
the abuses of the past.
But really fine tuning honing in
so that homelessness but I think
also on middle income housing --
Would be is really what I to to
try and influence to be involved
in this process so --
To be continued.
John thank you very much for
your time a last the next that
said a panelist to come forward
and staff will help but folks
out to get situated.
Steve held my distractor room
I'm also here at your service
and how they're Gomez from my
team here is.
I'm also a point as an account
to be here today at the city's
it.
Sir early slow a is here as well
as our planning director my
Kansen guy thank you both for
being here for the innovative
stuff you're doing.
At the city of San Diego.
I'm calling Clements from --
Sandbags here thank you so much.
Housing transportation these
things go together right we have
to we have to work together my
roast us from a lucid.
Well Hans take a San Diego I did
it myself briefly --
Is is here I mission is
individuals because I'm not
presenting today --
But I appreciate the the
collaboration --
That your presence here --
Indicate --
And indication that we're trying
to work on all this collectively
right -- And
then we have in a couple of like
to officials offices are present
this out afternoon there pro tem --
Our own Toni Atkins please tell
Tony hello --
And if markets bush --
From.
I'm not I almost accounts
president but see I million
ahead of myself councilmember
Georgette Gomez please tell
accounts number appreciate her --
Collaboration --
Acosta bill this year I think
that's going to be the news for
next year what we got done in
the twenty eighteen session and
then last but certainly not
least out a raft Democrat for
about council president medicals
office.
A murder that old and dear
friend and she's in her service
to the city San Diego soon --
We thank her for all for
leadership on housing for so
many years please thing myrtle
five thank you.
OB I see our next panel is.
At the table thank you guys so
much for being a position --
We're gonna start off with low
about filing --
From habitat for humanity low is
an old friend it's great to see
you here of please take it away
glad to be here.
See my side to ready to go.
On really glad to be talking
about the missing middle and
thinking about all the efforts
that are going on and they know
that housing.
Just just to give some a
conversation to the public into
the elected officials that we
need housing and it's okay to
vote for housing.
It's difficult to do that.
I'm also again again let Rick
and you said about of Sam Neill
wouldn't the cost of housing is
so high that the missing the
middle or taking up the low
income housing.
It when I'm trying to build
housing for low income families
and I go to a rotary club and
I'm trying to you know Chen up
so many for low income housing
and you're looking at a whole
aye audience.
Of people can't afford a house
themselves as hard to get at
expand the supply for low income
housing.
Is gets more difficult.
So I just wanted to share a
little bit about what hand
habitat does and we build new
homes we partner with families.
That are --
We partner with families to help
they will help build their own
home we build with volunteers
and we partner with city so it
takes a lot of effort to bring --
House together and we sell the
this is an example some people
of asked when you build with
volunteers what does the house
look like.
It looks like a very nice house
like any housing when with that
went to live in and they're
pretty proud to be able to help
both at home and to be able.
To afford that home at the 30% a
level so I have a couple of
examples and if you start at the
bottom.
Of this is a families income in
at your fifty thousand dollars
at 30% they have twelve hundred
dollars available for their a
housing costs.
You have to add the mortgage
taxes insurance an H. away so
that's the twelve hundred and
seventy one so we will tell the
home to the family.
At to their first mortgage would
be two hundred and nineteen
thousand dollars habitat would
end up with a silent second I
would look for down payment
assistance wherever we can.
Fortunately for one project the
housing commission is providing
I'm some have died down payment
assistance really appreciate
that a great deal so they're not
family will be in that home for
two hundred and twenty thousand
dollars.
At the home itself cost us four
hundred thousand dollars so it's
a lot of fund raising fifty than.
This is another --
Another family --
Just is similar Levin hundred
dollars is available for housing
they would have a mortgage once
again we just divide their hot
income.
By 30% to figure out what
they're housing cost so a ten am
very beneficial to the families
because that's where they can
build wealth --
We want them to be a part of the
community they become part of
the fabric of the community they
also need. For that --
Bill there up.
Yeah.
Hundred ninety two thousand that
they pay to habitat.
This last family is a moderate
and in a middle income family so
when you think about the
opportunity to provide for that
missing middle --
What kind of subsidy would it
take and in this particular
project we have a --
The land was provided to us at a
very low cost so then our
housing costs are about four
hundred thousand makes it so
that this family can afford
their entire mortgage.
In there's no subsidy --
In that sense except for the 0%
mortgage.
So they're they're at their
monthly amount available for
housing nineteen hundred and
seventy four you get the markets
taxes insurance an H. away.
In there that says that still a
good example of what we could
provide --
And a backup when we think about
what you need for future --
Legislation you've talked about --
Redevelopment as an opportunity
where also looking at sequel
reform habitat in California
just got --
So resolve the and frivolous
lawsuit a sequel lawsuit it held
the project up for two and a
half years a neighbor that.
Protested the project Acosta to
pay for that --
Or fund raise for it that
habitat did in.
That particular habitat dead so
sequel reform is very important
also -- So
when we think about this a
surplus land that the state of
California has or cities have we
need some clarification on that.
Because which I think the rules
are you supposed to get the
highest and best price but if we
really need a willing at
affordable housing middle income
housing low income housing.
And maybe state could think
about transferring that land to
a land trashed making it
permanently available for
affordable housing --
In in a lot of different ways so
that would be one way that would
help and also I think there's
some clarification for special
districts because of the water
district owns it.
They don't really wanna make it.
They don't want to lose that
asset to the from the repair so
I think there's some
conversation ask to go along
with that.
And also developer impact fees --
Are they proportionate for the
cost of the home and what we're
building.
So just a couple of ideas for
the middle income aspect of this.
Thank you Laurie --
I think Jim is next up on are
advertised agenda okay.
Thank you very much and I and
kills member of being tied to
the same thing on behalf of the
local economic development.
Corporation EDC is a recently
adopted a very visionary program
called inclusive economic
development and it's quite
exciting when.
You add the word inclusive and
from the words economic
development.
And one of the tears of that is
affordability and obviously a
huge part of affordability is
housing. One of the things that
we're trying to do is to develop
better data sets so that instead
of people just talking in a
totally.
Were talking through their own
biases we use data one of the
studies that we're working on
now is to develop a good data on
the various layers of income
strategy in the community.
We're trying to match that with
building permits and housing to
graphically show what we all
intuitively know.
And that is that there's a big
hole in the middle but we want
to use the data for that.
There's a there's another
fundamental point of lead into
my ideas for legislative action
costs to a project.
Assuming incomes art level then
the number of people that can
qualify necessarily goes down
the cost of a certain percent of
your consumers of your market.
Cannot afford to buy the
property or cannot afford to
rent the property.
And we want again be able to
quantify that.
And all all of our use an
example of one that that a lot
of people have said to us in
this is not send the political
context and not even said from
an agenda point of view.
They deeply believe from their
analysis of the numbers.
That the city of San Diego
increases its inclusionary
housing level.
From 10220% and if it goes to a
prevailing wage standard nothing
will be built.
It won't not be built because
people are angry and take their
marbles and go home it will not
be built.
Because the numbers will not
work and you're gonna have even
a bigger gap between the
affordable that a subsidized and
the market that to some extent
immune from these things.
And again those things have to
be done with data and that's
complicated in walls a lot of
issues.
And we just talk about some
things and somebody's there are
a lot of it's funny very similar
worries.
But in our community tied the
water quality control board
storm water management
requirements that they imposed --
My adjective arrogantly.
My age if but today imposed
having have.
Dramatically impacted our
ability to do.
Housing in San Diego and I'm not
talking about green field here
that's different even a big
project you're designing from
scratch you can build a lot of
systems and so I'm.
Specifically talking about in
cell the legislature does have
the authority. To go in and and
legislative around a water
quality control board mandate
those numbers are twenty to
forty thousand dollars I
personally was trying to do some
infill projects very simple
infill projects.
And I happen to get caught in
the switches windy when those
laws came into effect.
The water quality control board
does not tell the city's what
they have to do.
But they tell the city so that
they don't do what the water
quality control board wants him
to do the board will find them.
So the city's naturally take a
belt and suspenders approach and
I would say I personally got
clobbered because no one knew
what to do so I would urge the
legislature and I know that's
not easy.
It's consultant people talk
about water quality but again
infill if you think about in
filament shark in mature
communities.
It's it's such a small thing.
Arm.
The CC date again I'm nomina for
likely to exceed eagle had I am
a passionate advocate for
renewable energy.
But the C. E. C. mandate for all
housing in California to have
solar after these two thousand
twenty or maybe beginning in.
Two thousand twenty is it is a
financial disaster.
It's going to add twenty
thousand dollars at least of the
cost of each year a single
family residence.
Now into McAllister said well
but you'll get that in savings
that's mathematically incorrect
it presupposes a certain level
of utility consumption and most
people don't have.
So I would --
Eight in the match and thanks to
won't give you credit for that
so when they're under writing
helping alone you can get into
warriors ratios.
Trust me they're not going to
say -- G.
Jim's utility bill went down
four dollars a month so I'm
gonna capitalize that increases
mortgage.
So that's a pure cost that will
again every cost shrinks the the
number of people that --
They can qualify for a given
product --
Laurie mentioned seek reform I
and it's incredibly complicated.
The the the lawsuits that the
tactical lawsuits are what
upsets people it isn't being
environmentally conscious it's
it's just being is being used as
a weapon.
If you could just add an
attorney prevailing party
attorneys fees costs. To the
sequel so that people have to
think seriously and I I
understand the social argued
against that for people that
don't have that capacity but
it's got to be carefully thought
of but something that simple
will would have.
Kept that neighbor from doing
what they did to you and you
wouldn't have that expense --
Doing infill site small projects
if we if and if you have full
lots are less you don't have to
go through the some.
Map actively for the three birds
in the feel like a leasing là
maybe you take that for making
eight I don't know what the
number is.
Which you increase that number
soul larger percent of your
properties can be done at our at
at without going to the
subdivision map act and what
that would do it within the
zoning within the community.
If I I I was involved the piece
of property that the prior owner
subdivided into four lights it
was a huge in for it should have
been.
Eight within the community
standards it was for why because
it was easier so there's four
lots off the off the inventory
so just a little thing like that.
From then some other things that
apply probably not so much at
the state level but I think no
cities it.
Is off the charts again I was
there. One city just in my
opinion extorted me on that were
as good city Chula Vista allows
you just sign something that
runs with the land it's as if
the street is ever expanded.
You will test you will
consistency.
The provide the second be anyway.
So that would be one the other
thing is incremental under
grounding of utilities.
It's it it's probably ten X. two
underground a half a block than
it is to underground a mile.
Of utilities if we believe is a
people the underground electric
utilities is a good public
outcome.
The net should be a C. P. you
see imposed three that applies
to all ratepayers is managed by
the utility.
And if they do it scale.
And you don't impose that on
individual property owner
because it it does just one
infill in particular just turn
your numbers upside down I was
Limón girls. Six houses we want
to bring them all in under four
hundred fifty thousand dollars.
The combination of the
underground and cost and the and
the half wood street
improvements and I and now it
will permanently forever never
be one house and said a six and
I I know enough about this
community to know there are.
Thousands and thousands maybe
tens of thousands of units
locked up through these little.
Of policies that I would
certainly like to Laurie
mentioned the deaths.
I mean the the the development
impact fees the traffic impact
fees or or out of control again
I don't think it's the state but
I would like. To to to say you
cannot collect the fee for
anything you don't plan to build
in ten years.
Make it very finite.
Because again I was in a project
right to pay fees for road and
managed they had scheduled for
two thousand and two thirds
Ritesh.
SO you get if you don't within
ten years you can't charge me
the death now I take some
administrative work but once the
systems up and running I think I
think that would take care of
itself and I would make it.
In not take any Jean a money out
of defines for any purpose when
you build the project can you
maybe do 5%.
So those are just a few ideas
that I think and can.
In a lot of a conserve personal
experience autumn comes from
work I've done.
In the public and the private
sector --
Then I I think with their a lot
of people believe me that want
to build middle income housing
in our community.
There's property there it's
already zone it is ready to go
and the the series of little
things incrementally
grammatically incrementally add
up make the projects impossible.
Great Jim thank you very much
and good ideas and there are
last on this panel is popping up
that Dr Sir the floor is yours.
Thank you very much.
Jennifer you gonna cheat up
[inaudible]
Coming --
Just before the see my power
point work down here work years
working fine right.
What are they while we're
waiting I just want to say that?
I'd I'd none of my projects from
the city of asking of the city
of San Diego but the city San
Diego probably as for all the
criticism against prop is the
best reputation of any city in
the county.
In terms of trying to work to
get make things happen so thanks
guys.
Good afternoon and thank you for
coming out for the public
hearing this afternoon --
We have a high housing crisis
and that's why we're all here.
But more importantly we have a
another car the housing that no
one's really talking about.
And and so as a member of the
two hundred I'm here to talk
about the home ownership crisis.
Others a lot of talk about
affordable housing which is
needed but there's also need to
have more homeowners
particularly for people with the
of middle income us hours a lot
of working class individuals.
So that's going to be the nature
of my presentation I want to
build on some of the ideas that
Laurie and then Jim have talked
about.
They're they're the experts in
the field there their builders
and and so --
More de ideas I'm gonna be
discussing is is all of the more
concept.
So at the table back here is is
a copy this of of of my
presentation there's gonna be a
number of graphs.
Not you know I don't know if you
can see those numbers very well
but if you want more detail.
There are they'll be there in
the back.
So the the the problem from my
perspective is that there is a
tremendous wealth gap between of
white and and and ethnic
minorities and it was
exacerbated during the Great
Recession.
And so this is a a charter was
put together by the by the pew.
Institute and in thirteen of the
the the wealth gap between
blacks and whites was --
Thirteen times the at the white --
Of wealth was to thirteen times
more than blacks and then ten
times for them of Latinos or
Hispanics.
And and and that's a problem
that maybe has improved just
from -- We
bet but probably not enough.
And and and homeownership can
can address that --
Wealth gap --
Going forward.
This is a of some information up --
On data from the federal home --
So station on loans and you can
see that over from. Nineteen
thirty four to nineteen sixty
two the differences in terms of
the the the the the value of
real estate loans made to whites
versus blacks in this particular
case.
Just a big big big difference
and then over to right you can
see the big difference in terms
of the the investment that.
Both communities have earned
during that same period.
Very big difference and so then
if you take those.
hand side you have both real
estate and investment value for
whites which is now.
A five trillion dollars during
this period of time I'm sure
it's gone up.
Another five trillion dollars of
thanks to the of the 1%.
Of it but then in the right you
have that of the ethnic
minorities ethnic minorities
from those.
For those two charts right there
represents less than 2%.
Of of of what the White real
estate values and investments
have been during that that
period of time.
So if -- If
you want to read more about of
the discrimination that is
taking place over the years this
is an excellent book.
There's a lot of stories in
there to it it's just going to
blow your mind you know you you
you you it highlights how of red
line you know I I thought.
That that that the banks were
responsible for red light that's
the federal government they came
up with that they they they
wrote memos so how to redline
communities and then.
Of course everybody else --
Waldron so excellent book right
now -- This
is provided by the California
association of realtors and and
the idea behind this chart is to
this to this to determine.
Whether the the various ethnic
groups are buying at at the at
that their at at the there pro
rata share of the population so
everybody if every household up
there.
By ethnicity was buying --
One one home for houses out
there it would be at zero so
what you have on the on the on
the on the very top is at
roughly --
Whites are buying --
17% more than the than their
their parity and and the courts
deadly the Hispanics which is
down below they're they're
they're buying about 17% less
than their parents or another
words.
The way they did the math and
this one is that in two thousand
fourteen of Hispanic households
was about 38% --
Of of California and then when
you take a look at the when you
take a look at the hot tub
household ownership it's 22% so.
Twenty two from thirty eight to
seventeen so a still a lot of
disparity that.
So there's a number of factors
that the going to why --
We have this housing crisis can
blame it on line cost labor
costs.
Over regulation sequel for sure --
You know everyone blames it on
greedy developers but the fact
is.
Is it it's this supply in if you
were to ask of of former
president Bill Clinton he would
probably say.
He would policy it's the supply
stupid.
And so --
And they're a lot of contribute
a reason why.
So in California.
We have here of as of two
thousand can't read that over
there are.
Two thousand seventeen eighteen
up.
Of the number of homes built
versus multi family so over here
in in about nineteen eighty six
of those --
Disproportion number of of
apartment was the result of a
lot of federal --
Incentives that were provided to
developers then they lost some
so then they stop building as
many apartments then in about
ninety in the nineteen nineties
it was a big real estate
recession recession as well but
really.
Really big of real estate
recession and then again at two
thousand seven it's the
beginning of the Great Recession
and so we're not just getting
out about.
Soul the far right.
They're projecting that to just
to stay at at equilibrate you
need to build a hundred eighty a
thousand homes here but that.
So quickly --
County the most under bill
county.
And take a look at how job this
person's housing permits.
Of so the problem is the good
news is a lot of jobs the bad
news is there's no housing and
therefore goes up.
So down payment.
When it was?
But now was the housing finance
agency has a program that can
provide of down payment
assistance what can San Diego
county.
I think that number is --
Less than a hundred fifty seven
thousand roughly so --
There is a lot of assistance
there so pretty much you can get
both the down payment and any
mortgage from from --
Cal of housing finance agency to
to buy a home at about seven
hundred thousand and that number
and and that they're going to
increase that limit --
Here beginning in January --
Lot of mortgages up there the
problem is.
You know.
The buyers you to be aware of of
the cell old mortgages that got
us in trouble. Ten years ago.
So.
A lot of emphasis has been put
on affordable housing but there
rentals and the problem with
rentals that you can never
building the wealth.
And so --
What -- The
two hundred has been advocating
for more --
Home homeownership quickly.
You know --
The there was an opportunity a
years ago to do a lot more fix
and flip.
But those fix implicit were
being.
Converted to rentals now I'm
proposing to do fix and flips
and and and and and sold to
first time home buyers.
This is example of some of it
was an old a GM plant in east
Oakland.
Was converted into beautiful of
community there of this is
another urban infill condos in
Sacramento but these.
Soul recently in the five point.
Five hundred thousand so --
That's the type of product ID
like to see available for the
for the middle income and
working class.
So there's a lot of local fixes --
Back back to be done --
And you can you can read more
about it if you pick up.
Presentation --
So [inaudible] Five phone that
would enable us small lot
developers and other people but
they can they can buy these
homes.
Renovate them and then sell to
first time home buyers of is is
is the big idea behind this
right now --
So if you do this.
Of the whole community benefits
by that because there's a lot of
people that have the money but
that their to product it's just
not available we can't afford a
million dollar.
Home and at the same time they
can't afford to live in
affordable rental rentals
because they make more than 80%
of the median income.
So -- So the
the whole idea about getting
people to homes it's it's going
to close the wealth gap you can
spend more time with the
families.
Of their of their of their of
their family budgets what are
not gonna be stretch because
right now we of their driving
you know.
Probably a hundred fifty miles a
day.
And that status for expensive.
So -- I'll
just leave it with that.
Thank you Robert of cash should
go back on the slides to the the
bar graph showing the the
housing production or lack there
of California.
Is as we do Q. and a and maybe
to lex person as a presentation
I think at least a graphically
illustrates the challenge that
you it was here and try to get
them to understand the scale the
size of what we're discussing it
what we kind of need to hit.
Where we are today --
I think this is the slide that
when I've seen in the past I
think just brings home for the
average constituent we're
talking about and why every
neighborhood has to do its part
of the city must do its part --
Hopefully you all got from
organizing of this panel is a
more about --
Single family development or
sort of free standing --
Non makes non multi family
product --
As well as this --
What rob was getting out --
About homeownership and that you
know we talk a lot about the
rent but we also we don't always
talk it nearly as often about
people's ability to actually
transfer to being first time
home buyers.
In developing the wealth that
really envisioned you stained.
A California for long haul right
as talk about you eight we
tested a lot in their education
[inaudible]
An attack.
Arizona of a nay and that's a
that's a huge minutes insult the
taxpayers who who help to do
that any kids want to stay right
but it gets to the central issue
that you're.
And so --
Toni Atkins --
When -- When
she was in the assembly did get
of -- So
much just station passed and she
did put to put in some money for
homeownership and then most
recently.
I think it was with prop one or
prop to with the prop to whether
a veterans housing so.
The good news is all about money
a hundred and fifty million
dollars is going over --
To California housing finance
agency for this down payment
assistance program.
They have the ability I'm not
sure how they do it --
There's somebody here staff
member you're you might tell us
how how they do it but they're
able to leverage it twenty seven
times so that.
Hundred through through private
sources funny so that one
hundred and fifty million is not
going to be --
A little over four billion.
And so --
That's going to be able to
provide down payment assistance
to about fifteen thousand
individuals.
So it's it's the it's a it's
it's a tremendous program and
more money is going to programs
like that.
Thank you Bob wills we're hill
from college FAM in the next
panel Lloyd thank you number one
for a knowledge in their lives
his here --
Housing matters I think it's
important have cheerleaders for
housing --
And and that's what the
organization does and hopefully
we can every can you do their
part -- You
mention a number of legislative
ideas when you mentioned that --
Animates me as surplus land --
Even with my own assembly
district the state has a
tremendous amount of land under
utilized --
With zero intention of utilizing
any better --
my staff and exploring currently
on parcel specific --
Piece of land that it just
preview --
We've really old state building
in two full city blocks in
downtown San Diego with zero
housing and wants to make a lot
of sense so --
They may see a bill from you
shortly to try and force the
force to hand on that parcel.
Key talk more about that concept
that what you personally be
observing and what you think
would be --
Useful in a potential
legislative concept to to better
utilize that publicly only.
So what I would have seen --
Land become available and hi
after and the land for so to
speak in order the housing on it
so -- It
there and it's not clear to the
agencies what they're supposed
to get or how they're supposed
to offer it at so some clarity
would be very helpful.
Some so clarity --
Even a prioritization.
And priorities yeah so a very
ation of that --
Is where the the the public
agency does not sell the land
but makes it available gives the
developer a long term lease.
And on that long term lease they
can get financing then to build
condominiums a bill homes and so
what happens is then you have a
shared appreciation lease.
So -- So it.
By not having to pay for that
line up front the developer then
can the build.
The homes or or condos and then
the public agency can get their
money back over time.
And that's a great concept that
almost promoted by.
Low you may think you what
Laurie made mention of such a
copper special districts as an
right fast but I don't think I
got what you're trying to say so.
So I one piece of land that
became available to us.
That they put out was from a
water district and so we wanted
to after them zero for it and
they don't want except zero
because of what they're water
repairs paid for the land.
So and I know that and sometimes --
A so that the rate payers are
made whole a new future years
housing dollars to pay for the
land -- But
if they're not told that that's
what they need to do or that
there's a priority for building
housing then they won't follow
through with that.
Okay.
Get some ideas.
On Jimmy had some awesome ideas --
I think we've made mention of
these and perhaps other settings --
The course --
Half with street improvements so
I got Voepel eight years the
city council not knowing what
you're talking about can you
clarify what that is sure I'm
again I use an example of that
name in the jurisdiction we were
doing a with in the middle of a
very long walk.
But it legal on block --
There were four houses on two
acres aim is a tragic miss usual
and but that's another issue we
probably at a hundred yards
maybe a hundred and twenty yards
of frontage.
So the city wanted us to come
into the street and this is a
mature street.
And do a scholarship in.
Bill the half with with curb
gutter and sidewalk and scholar
back out.
I'm the worst flooding Rangers.
It's not functional and it's a
stupid waste of money --
And again the my way to handle
to the city believes that as a
future interest in possibly
widening the street.
Then you make me reserve an
easement.
And agreed not contested so I'm
not saying you abandon it.
Just coincidently the place
rather for thirty years there's
a easement in front of my house
and such okay but you can't but
you low those numbers.
Up front --
You warm up front to the the
reference to the way that cost
for that particular project to
do well the the to build it
would have been about sixty five
thousand dollars this was part
of the two thousand and thirty
five traffic improvement.
Study yes and are they allowed
me to buy out of it for forty
thousand dollars cash.
Which I would bet you --
Nguyen in their general fund.
Which makes it legal yeah.
We can.
One what about deaths in.
About the legacies of of the
communities and I've.
The one thing a we've learned if
if you look at the city of San
Diego a few the south of ninety
four tiny look at the districts
the deaths are a lot higher
there.
Now Robert mentioned redlining
you know a lot we're still
living with the legacies of of
of segregation were living with
the second of the legacies of
racial profiling.
So if you look for most of our
land is in the city of San Diego.
It's actually south of the
ninety four the south of the
ninety four has the highest
deaths.
Why is that it's because
historically it was community of
color so that wasn't capital
invested in?
It's fundamentally unfair and I
think it just continues a
pattern.
Of of in inadvertent in today's
age but it continues a pattern
of underdevelopment.
And it might be impossible but I
think would be interesting if
this instead of being district
by district.
Or committee by community were
in the entire the some portion
of it was in the entire city.
So that you can get money into
these neighborhoods because the
numbers of the value of the unit
you produce is not high enough
to support.
The deaths that are indirectly
the result of past political
decisions to wonder invest.
That address the issue of
conserve you're describing of we
can't build in ten years dot
Charlie for right because you
know in many cases these monies
are seen accounts going on spent
and the really hard question is
this the political society have
an obligation to collectively
put money.
Into a place that have
historically under invested in.
As a hard one but I got some
visions for equity agenda for
the city that I think gets to
what you're talking.
To yeah on it last I'd say the
subdivision map act idea makes a
ton of sense to me --
It kind of feels it quickly from
law would have a similar
approach to maybe the state's
recent actions on as as we go on
units.
Of you to do so the at the state
level they could really
functionally increase the number
of actual doors being bill in
communities took the communities
of maybe generally resistant --
To to housing development is
that right deferred of my
friends the city San Diego has
been a leader in that they know
a lot more about those things
and then I then I do so I would
for to them.
Added because I did not know
whether many have been built and
how that's worked out to the
city's trying to make that
happen.
This really incentivize in and I
would echo the kudos you why
with the city's --
And that's impressive in you
know I I one of my usual of
complaints is that said it is a
lead as much as it needs to or
should -- In
this regard it is leaking --
And it's a that it's by it
legislation was not successful
not this year at least --
But stay tuned I think what you
prove something as a concept
it's it working in communities
and actually enriching
communities looks more likely to
do but I'm not possible without
actual examples of thank you
guys for what you're doing --
But I I think that's an area of
that with this committee would
be very should pursuing a piece
of legislation as you say
leading --
Useful and under utilized makes
zero sense gets built mortar
Roberts point I think you're
saying because you're type a
single family home felt aye
freestanding.
Stuff that we actually create
for sell product.
And and get another very common
problem exists we talk about
special districts or water
districts and sewer districts
and again be anybody in this
room has tried to do any project
is encountered this you come in
and you're the last person or
you're at that sort of the and
they come.
And say Gee for your five units
you the need I'm only can much I
understand but you're the last
person to show up.
Now I'm not sure which is slated
we how you deal with that but to
not have the last property
standing.
Have to do a disproportionate
load and what is in my opinion
an essential social service like
water sewer for example.
Is is really hurting and again
what are we talking about to
limit infill existing
communities middle income
housing.
And it's really putting an
unfair burden.
The way and the the way the
Mathis down within these
districts and I've I've seen a
lot and I'm sure everybody else
has also.
Taken a we got over a little
time here so I'll I'll take you
very much for your time and your
your contributions this
afternoon thank you all.
Three I'll call up the next
panel and will bring them forth --
Yeah might just you know give
some homework to my public
agencies who are here but as you
hear so these ideas if any of
them stand out. To you from the
city or stand at either so the
advocate groups who are here --
I certainly be interested in
your feedback on as we develop
the proposal it's something you
think.
We can do --
At that would certainly make it --
Vice things that we could enter.
It does but it is instance here
caption steps and and if you can
bet it out and share with your
agency organization would
support it --
That would be extremely helpful
as we before developing these
concepts are surrounded our next
panel --
Which focused on middle income
production minimums --
Jerry made it welcome thank you
that is how it should be a lot
of effort to be here.
Visit how many cities today to
be present a couple.
Crossed over into Mexico for a
little bit.
In to Phoenix and sadly Las
Vegas have to do that too just
to fund affordable housing so --
Illustrates the point I'm I'm so
glad you're here you might start
is off with this man.
Thank you.
Good afternoon chairman and
honorable members of the
assembly my name is Gerry
Glasser Hedrick and I'm the
director of business and
government affairs for the
California housing finance
agency.
I thank you for allowing me to
participate I'm here to talk a
little bit about what Kelly to
pay is doing in the mixed income
and missing middle space --
I have a presentation here --
By way of background Kelly to
phase serves as the state's
affordable housing lender.
And was created to develop
public Berman and private
capital investment.
Investors to help increase and
preserve affordable housing.
College of a is self supported
and does not rely on the general
fund for its operations.
Since its inception college of a
has supported the production and
preservation of multi family
housing.
As well as homeownership
programs down payment and
closing assistance programs.
Special programs in concert with
local governments.
Ample cities and counties and
also has --
Provided --
Veterans housing this scope in
approach to a continuum of
housing needs is addressed in
caliphates mission which is to
create.
And finance progressive housing
solutions so that more
Californians have a place to
call home --
As indicated what I'm here to
talk to you about today.
Is our mixed income program but
before I get into the next
income program I wanted to give
you a little bit of history.
Regarding how the funding came
to fruition I'm to my knowledge
this is the only state program
and that is aimed at a continuum
of housing affordability between
thirty and a hundred and 20%
area median income which I'll.
Get to in a minute but as those
of you in the room might recall
to the the big year for housing
in the state.
I'm not only was a four billion
dollar housing bond passed by
both the legislature and the
governor which was just --
Approved at the ballot in
November and is going --
To go into went to a fact to and
hopefully that --
Bond is going to recharge a lot
of our gap financing programs at
the state level but in addition
to that large effort there was --
At at a bill that might have
gotten a little bit less
notoriety --
But might be very familiar with
San Diegans because it was
championed by and senator Atkins
at the time --
But it was Senate bill two which
created the building home and
jobs act --
Which became effective in two
thousand eighteen and what that
did is create a permanent source
for affordable housing
throughout the state --
It's based on a seventy five
dollar recreation fee --
That's recorded on certain real
estate transactions those
resources go into a pot of funds --
Which then is divided I'm Tina
was Nguyen eight city and local
jurisdictions in 20001915% of
the proceeds.
I'm which is approximated to be
about thirty million dollars
will come to cal HFA.
On to develop a mixed income
housing program.
So that's essentially how we got
to where we are today --
Our executive director T. about
men Patterson is very interested
in the concept of more
integrated community is and the
mix of incomes within projects
which for those of you who are
engaged in the portable housing.
Community husband challenging
because the tax credit program
really focuses on or has in the
past focused on income levels
and 60% and below.
And so there's been an absence
of production of mixed income
projects and have a units that
are targeted above I'm sixty or
80%.
Just because they've been really
challenging to finance --
So -- For
the last year Callie Jeff a has
been out --
Talking to the development
community out financing units
outside of the tax credit round.
Given the loss of both the tax
credit financing and what is
used to finance projects in
California --
The welfare exemption which
exams affordable housing
projects from property taxes.
I'm it's really challenging for
developers to produce units
outside of the tax credit
program.
And we heard a lot of this
feedback from the development
community.
And so we we kind of came back
with all that that that
information.
And we crafted a program to try
to reflect the market conditions
that exist in the community.
And what we've done is we're
trying to leverage our existing
affordable housing programs
through the bond and 4% tax
arena -- And
to try to leverage on the fact
that -- The
federal government approved new
income averaging laws which
allow projects --
To target unit 60% up 280% as
long as I'm the average
affordability is is 60%.
And then also we're trying to
provide incentives but not
mandates that --
Developers included tron XIV
units that go above her outside
the tax credit --
Restrictions so that were really
creating a continuum of housing
with in projects with.
Some units that will be targeted
below sixty sixty eighty and
then hopefully above eighty as
well.
I am we initially sent out a
term sheet in late August this
year we received a lot of
feedback from the development
community and we've been
retooling our term sheet.
Sense then --
But generally our program will
be focused on new construction I
think assembly member --
Gloria was was perceptive with
regard to the fact that we're
just not producing enough units
in the state to keep pace with
demand.
And so --
There is a supply problem --
You know all others argue that
there is there is a demand
problem as well but but markedly
we have just not been producing
enough units to keep pace with
with the need.
I'm so this program husband I'm
specifically designed as a new
construction program.
Their resources that college of
Faye receives from --
The permanent so born and
financing very similar to the
way other --
Programs are structured at the
state level and the unique thing
about the program is that the
resources will be able to be
used on units that are
restricted anywhere from thirty
two hundred and 20% area median
income --
And the resources --
Will be paired with a bond and
or bond in tax credit project.
But the number of tax credited
units can be as little as 20% of
the units on side so it could be
a very -- It
could be a partial tax credit
and market rate development --
The units could also go up 281%
we're trying to provide people a
lot of flexibility.
With regard to what they end up
building but trying to pair it
with existing --
Under utilized resources at the
state level --
There are going to be --
To preferences --
In addition to some geographic
and project type parameters that
will govern the program --
We are gonna give priority to
acts that --
Target at least 10% of their
units to eighty one two hundred
and 20% area median income.
I'm it will be a requirement of
the program but to the extent
that a feasible option for
people we want to try.
To encourage people --
To target that level and we
definitely heard the challenges
in developing those sorts of
units given the loss of tax
credits in the welfare exception.
But the development community is
remarkably --
Creative and we're hopeful that
they'll be some interesting
ideas that they're able to bring
to the table --
The other preference will be the
lowest --
Subsidy request per unit.
The idea here is to try to
incentivize developers to
leverage other resources to the
greatest extent possible and to
try to reduce costs as as much
as possible --
In addition to those preferences
we are trying to ensure that
there is some.
Geographical distribution of the
projects and no one county will
be able to receive more than
fifteen million dollars of the
subordinate financing.
And we also want to ensure that
we have more than one sponsor is
able to benefit from the program.
And so -- No
one sponsor will be able to
obtain more than ten million
dollars of resources.
In addition to that --
There will be --
Housing to family units --
40% of the of the resources
targeted to projects will be a
to projects that have at least --
25% three bedrooms and no more
than 40% of the resources.
That are provided --
Through the program will be for
senior projects there's been a
lot of discussion about micro
units -- I
think especially in San Diego
and college Ave is really open --
To the idea and the creativity
that developers are harnessing
with my car units but we still
want to ensure that some of that
units produced as a result of
this program --
Are targeted for families --
The program will allow of forty
thousand dollars per unit per
restricted unit and so.
It's not only the that are eight
on the U. it's it's all of the
all of the restricted units in
the project we're hopeful that
this makes the program
attractive to developers.
That have --
Potentially bond in tax credit
deals -- In
order to become feasible and
they might convert them to meet
this prototype and also bring.
Potentially other projects into
the mix that wouldn't have been
feasible absent this money --
Into the mix the we will charge
the percent simple interest for
the resources --
So that is the general --
Kind of an overview of the
program we are hopeful --
That the thirty to thirty five
million dollars that we produce
will result in --
You know seven to ten mixed
income projects throughout the
state it's not --
A significant amount of units
but it is --
It is important and I think we
will begin --
To create space within the mixed
income missing middle I'm
continue --
That we hope will will catch on
the program roll out and is
scheduled --
In mid January we will go to our
board for approval in mid
January and will roll out term
sheets --
There after we will be is into
put on February action.
Solicit applications by the end
of April.
There was a slight --
Correction that I wanted to make
or just I guess the difference
with regard to our single family
programs it was it was stated in
the presentation before that the
additional one point five
million dollars of down payment
assistance would --
Potentially SS --
Fifteen thousand homeowners and
are that it will assist at up to
twenty thousand I'm homeowner so
with that --
All hands --
The Mike over to them part.
Thank you bad thanks for being
here.
Questions first year what taken
together okay.
So my name's been work on with
the California municipal finance
authority it's a group most of
you have never heard of but we
are kh to a bond issuer.
What that means is we just
actors that we just issue the
bonds we don't actually have
money in the project --
The same FAA we do a bunch of
other things besides affordable
housing but at this point we've
done about six billion dollars
in affordable housing bonds --
That's been about four hundred
twenty projects.
Which it was about thirty five
thousand units throughout the
state --
Currently have worked in over
four hundred cities and counties
and states.
Wanted citizen counties
throughout the state --
Seem if a we also have a kind of
a sister organization we do
nation wide issuances.
And I've worked in the state of
Oregon since New Hampshire and
Florida.
Doing bond issuances in local
jurisdictions there --
The reason I I say this is
because I kind of I feel like
I'm a macro perspective of
affordable housing in the way
things are done --
Not all.
California but throughout the
and then I've been able to see
over the past couple years --
Other states.
Operate and how they do their
four wheel housing and it's been
interesting to see the different
programs and incentives that --
Other states offer is anyone
been Cañada lately.
I haven't either but apparently
there's no homeless people there.
So what why it why do they have
no homeless in the we have LA
were closing off entire city
blocks for homeless people.
You know or you look at New York
wise the homeless population
increasing rapidly in Boston
homeless population.
Decreasing wrapping.
To so.
Stop.
To speak local instead as for
producing that middle.
Bracket --
Bowls of people that are really.
In a tangible benefit there's
not many there's not very many
programs the California has to
offer cities don't get some
kinda.
Extra bonus they don't get some
kind of vouchers or anything
like that because they produced.
X. amount of homes it's 70% area
median income --
But obviously there's a lot of
intangible benefits diversifying
housing the markets --
Surveying people that are
underserved behaving being able
to keep families in place.
On keeping transportation costs
down there's a bunch a macro
economic.
Statistics statistics you to
look at for families that live
within a certain.
Area is a poster driving into
those.
Those areas so if you're looking
at a map review affordable
housing is actually very simple.
To qualify for affordable
housing project you need forty
first you need to have 60%.
Very median income and 40% of
the units that were you do 50%
area median income in 20% of the
units.
On a federal level that's it
there's nothing else.
In the state we have overlays
upon overlays upon overlays of
things that need to happen to be
able.
To issue the bonds for
affordable housing before they
so it's an interesting
perspective if you go to
Tennessee or go to Texas to get
in for will housing you just go
to the state treasures window
say I want to affordable housing.
They give you allocation.
And there you go you're you're
you're moving right along --
If you're in not the city but if
you're in other cities it can be
up to a year and a half right
now just to get an inducement
resolution.
Which really starts the window
of being able to capture those
costs and bonds in your taxes
are Bonta make your financing
much cheaper.
So we got a look at what what's
hurting affordable housing and
and what I've seen on the
hundred plus housing bills I do
a year [inaudible]
Is.
This nor trên obviously we lost
already a we lost the gap
financing were luckily getting
some gap financing coming back.
That's not going to cure the
problem but one of the bigger
problems that we've seen.
Is construction costs in the
delays and timing so projects
going up so right now we're
we're about 829% of our projects
having to go back into said lack
and receive supplemental
allocation.
Where they have to increase
their barring amount?
As a construction costs have
gone up in the year that they
decided to doing the project.
We've done a lot of projects
that sister projects.
That within one year
construction costs not locales
gone up almost a 100%.
And so really one of the driving
factors I think to producing
affordable housing.
At the forty and 60% of them are --
Sorry 1650% in my in --
Those higher brackets is
speeding up the process making
things --
Much easier to do.
And we are going to then a
second --
But making the process much
easier and to get construction
part started because if you're
adding an extra couple million
dollars in the financing of
borrowing to produce the same
amount of units it's not doing.
Anything for us.
And that's really one of the
biggest things we're looking at
is a five ten years will ten
years ago we're really looking
at greening every affordable
housing project there was they
couldn't figure out.
Why we ballooning three hundred
twenty five thousand dollars per
unit and now we're getting?
Six fifty seven fifty San
Francisco sitting a million
dollars per affordable housing
in it you're in riverside you're
hitting five in a fifty thousand
dollars per unit you can build a
house.
Interceptor five in a fifty
thousand dollars but we're
building a single unit an
apartment complex.
Some things don't make sense and
so we really got a look at the
fees.
That are being charged we got a
look at the overall construction
overall costs it's not just a
simple cost it's all the things
that are added.
And then the timing because the
unfortunately the developers are
competing its market rate guys.
And they don't have to go
through the entire process
getting crushed it's taking year
to get going on a project where
mercury guys can get going right
away.
And in that time their
construction sought throughout
the state and it's getting hard
to line up the the construction
companies to get moving on the
projects and so the the cost of
the project --
On increasing.
So one of the things to benefits
or two two bright spots I see --
Unfortunately bonds are still a
little bit behind on tax credits
bonds.
If you're.
It 60% so you have one get 61%
doesn't matter federal doesn't
care.
So that you don't get any extra
benefit for doing for bringing
in somebody at 61% --
For tax credits they've recently
made some changes and now you
can average incomes so we're
hoping within this next let you
what -- And
federal legislation cycle the
bonds may be able to catch up in
your you can average income a
lot more and I think that'll
directly impact --
Whatever what's your for today's
you can start adding since --
7080% area median incomes maybe
even higher.
An average it down with some of
the lower median incomes --
In with that that's I mean
that's just kind of the map
reviews of what I've seen.
And we will be happy to take any
questions it's awesome of thank
you both for presenting --
Injury I'm sorry I think it's a
bit stretching aim at the
beginning.
Above should happens a fair
amount but I'm grateful that
publicly all the effort you made
to be here today.
Up you know I think you the
first panel did talk about
Michael units --
Any mention an openness okay
talk a little bit more about
that that seem to get a better
traction --
In in the early part of this
hearing.
Yeah I think that --
Micro units have been response
in in somewhat to the increasing
construction costs and just the
changing demographics in urban
areas. To try to address the
housing needs --
I think that you know out I've
spent most of my career in a
kind of traditional bond in the
in the traditional bond and tax
credit world and there's there's
very prescriptive.
Especially in the 9% program
kind of very prescriptive --
Criteria for projects and unit
sizes --
Eight I think they front types
is of house I think so.
That we word word trusting
market concerns --
And that the projects that are
being constructed with
subordinate financing are are
consistent with with what is
being produced by the market.
So we're not producing markets
are subsidizing Ana projects
that are that are inconsistent
with with what is going on in
local markets but I think were
definitely open --
And you know there's been a lot
of discussion about --
Modular unit sand bringing in
the kind of kid.
Different sorts of storage
containers --
Menu better man pre manufactured
to decrease --
Construction times I'm so I
think there's a lot of
innovation going on in the kind
of the bill environment
associated with affordable
housing which we want to be open --
To we just also want to be
really cognitive that we we were
we continue to serve --
Families and seniors given --
That they they are a large
population of need it with in
the group of individuals that.
One of my that's a full here the
the part of the previous
conversation was --
And observation that these
projects are are permissible
under kind of existing codes --
But that the challenges been
financing --
In some ways and the
presentation of Doug still here --
Of trying to do with private
financing for a variety of
reasons --
But it at all knowledge meant or
even an interest --
For public financing in the
space --
Might be to the the last piece
to actually get the doors open
on the string.
Bed you made mention of that for
door costs --
Recognizing the part B. play
this pick the role --
Eight any observations on
jurisdictions are doing well and
getting that number down or
bringing it down.
Well.
If you're using.
Fifties living where you can.
You know look it's on for says
there's a strong requires
required.
Where you're? One of the things
was done as the title twenty
four requirements that were put
into place while ago really.
Increase and things are coming
down from there.
But jurisdiction wise I think of
a cost per door is that how
quickly a financing can get done.
And that's from the start of the
financing to getting into said
lack. To getting the bonds
issued --
Take a year to go through that
process.
And it's because of all the
checks and balances that been
put into place --
A lot of its very redundant and
there's a lot of you know some
of the cities and counties just
have.
This is how it's done it's
always been down that way and
that's just how it's going to
continue to be done.
And it's just their own internal
policies and procedures as
opposed to what's really
required on federal or state
level to be able to qualify.
So that time line if you can get
to the dirt quicker it's
obviously gonna bring down per
door.
And we've seen a working with a
lot of cities and counties over
the last little while.
We've seen cities and counties --
At asks to come help them
through the process [inaudible]
Gone. Two dozen counties and
they're getting the process is
down.
Procedures Donald a little bit
so they can get into said lack
and to teach các and to be able
to have the bonds issued at a
quicker pace.
Interpreting question the
purpose of this hearing is to
tease out legislative ideas and
concepts of between.
Nineteen legislative year.
In that sort --
Guidance that would be okay
legislation that might prescribe
a time line to get you to get
two things we have.
The bonds will be fixed and to
kind of a long term.
The construction cost seems to
be one of the bigger problems I
think the developers are.
Are hitting right now and
there's a lot of local
requirements like I said I've
worked in for her plus cities
and counties.
Throughout the state the require
different things that.
You would put on your own home
yeah and it really drives up the
cost per unit and they don't
pencil.
You know northern California
just as an example because I can.
Known for the California terms
and but there's a lot of the the
lot of the developers will add
on every random --
Bonus they can get within like
the celebrity school programs in
a senior facility.
Does make any sense but they
want to score the Max amount of
points and they they commit
themselves themselves to
different things or cities and
counties will make them do
different things after to the
project.
Which really costs a lot per
unit.
And so it's a matter of cities
and counties looking through
their affordable house
requirements and saying do we
want to build affordable housing
projects.
Or do we just kinda want to
manager process ago is
interpreting you saying was that
there were --
Perhaps --
Public hearings or procedural
votes a redundancy in that
process that you're perhaps we
could make clarify that those
are necessary or or even
actually counterproductive so
there's a few federal once you
have to do to be able to get
your bonds unit of an inducement
have to have a tougher.
Yet of a final resolution --
Inducement resolutions you can
show me clear this is since
you're you're doing it able.
Can capture any bond good.
The bonds.
There's a lot of cities and
counties you work with to do the
tough for her you know for
helping them with their
inducements --
It may take him three four
months just to get going on an
inducement an inducement is done
by the city's --
Bond counselor that it's the
bond counts the rights the let
the resolution.
In an inducement should really
take more than two weeks for a
total review I don't even know
why would take two weeks from an
application to review.
As opposed --
To I'm doing it tough for right
now on working with and do some
processes hearings to do
whatever.
And so a tough for a firm this
and now a tougher as mandated by --
Nineteen eighty four tax code
essentially just says you have
to have a fourteen day notice
they've updated that's also hard
notice.
Any out of a public hearing
that's it.
If you're in Texas you can be
five counties over within twenty
five miles and the tempers good
you don't even have to be when
you're jurisdiction.
So there's all these different
things that we deal with tougher
as to look one zero sum up they
have a five step process were
first they have a tougher
hearing.
And then they have a tougher
monitoring and they have the
actual hearing it city council
in your to wait another two
weeks to do the ratification and
then two more weeks to get the
numbers minutes before you get
your actual approval.
That that that adds months under
project.
Which doesn't do anything yeah.
Interesting.
That maybe some for follow.
Up there with one of our time
thank you are both --
For that --
Presentations --
Will transition to our final
panel this afternoon thank you
again --
Panel discussion so we'll
probably have to have you come
up here like the palaces to
capture --
On the video and audio --
Our last panel --
Are two fine gentlemen I'm
really good glad you both could
be here.
Today --
We'll start off with Steven
Meisel who's exactly director of
our very own standing housing
federation.
Do think so much for being here.
Thank you some remember.
You for the opportunity to be
here will start with you they
will go.
To great.
So -- Thank
you my I am Steven Russell
executive director of the San
Diego housing federation and
chairman Gloria thank you for
the opportunity to be here --
Our vision at that send you
housing federation --
Is that state or region is a
thriving Ste was safe and stable
place that we can afford to call
home.
And of course the reason is that
a safe place to call home is the
basis for all other successful
outcomes in life --
Social medical educational
vocational --
And also add a search in this
would would say that the
populations we primarily seek to
serve -- Are --
Low income working families
seniors veterans transition each
use neighbors living with mental
or physical disabilities and
recently homeless individuals
and permissible of housing we
also work coalition with house
California C. H. C..
And are sister organizations
scamp -- NPH
Kennedy commission C. C. R. H.
and others --
When we talk about --
Housing and and even talking
about middle income or moderate
income housing it's important we
accurately identify our housing
production we we definitely have
a good handle on the demand side.
Of housing but not so much on
the supply and when I talk about
that is really --
Both production in existing
supply.
When I is this is a slight that
I often uses for may be familiar
to folks --
That we Chen.
Housing production in the region
from 200-032-2000 thirteen so in
that decade this is segregated
by -- That
the categories the Reno looks at
low as you can see according to
this truck with over produced in
the above moderate income
bracket --
In in moderate income and low
income we produce roughly a
fifth of of the the demand over
that period of time --
Fume important take was first of
all.
It's not exactly accurate we
will narratively we know this is
roughly true the at the data
that is gathered about moderate
income housing is not very
consistent across the state.
And that's that's a problem it's
it's easier for a lot of
municipalities merely claim
above moderate housing rather
than go through methodology to
prove that they have produced
moderate income housing.
Please numbers very and I
believe there seventeen
jurisdictions in the state that
go through a methodology to
actually identify the moderate
income production it's easier
just to sweep it all up into the
top.
So that's there's a problem
there in terms of actually
knowing what we produced.
It still the narrative is still
roughly true though we we we
believe that --
There is a lack of supply in a
moderate income housing bracket
and that it has disastrous
effects on the lower income --
Because residents because those
folks who are moderate income do
not go without housing they make
choices for housing that maybe.
Sub optimum for them maybe a
neighbor they don't want a
smaller place apartment versus a
home with moderate income
households do not go without
housing.
Are they simply by up or rent up
the housing that has been
occupied by lower income.
Individuals --
Next I think so what's important
is also recognizing the
differential impact the housing
costs have a different income
levels as I've just described --
And I'm gonna school through
some of the income sites really
quickly because the late hour
but when you look at what 60% MI
is and who that serve you can
see that these are critical
members of our community.
When you look at what the wage
went gap is we we look at --
The first two partial with what
you need to for a one bedroom
and what is needed to forty two
bedroom and then you look at
folks below 80% and mind what
they're making.
And you can see that there's a
significant gap for us
professions that are we consider
middle class in any case as a
legal secretary a police officer --
Nurse should all be obviously
able to afford to live here.
At about.
AM my the gap less severe
obviously honest.
Which is a this.
Are in this sort of ties into
really a when a rental gap --
Affordability gap when you look
at somebody police officers 60%
a mind that is a starting salary --
Minus over time and you can see
that even a police officers over
paying five hundred and forty a
month typically on average --
For a real local department the
the apartment costs for market
point realty advisors --
Is is obtained through October
nineteen Tribune story you can
see that.
The gap is less severe as you
move up the income scale there's
no no surprises there with
important quantify those things.
Is important to note that we
have both a supply problem and a
use problem.
And by that I mean not all the
housing in the region's and this
is a recent analysis that Sanday
did the show the 5% of the
entire market is off.
Market --
And that includes a variety of
things that include of vacation
rentals vacation homes --
Impressive occasion rental short
term vacation rentals rental
homes -- In
many cases cash depositories for
foreign nationals were
protecting assets in US
denominated real estate US
dollars --
With that's why we're producing
hundred and 30% of the above
moderate income housing is
region's because we're serving
and national and international
market in that sector.
But that's 5% is a crucial
number because it is we we may
work well recall 5% vacancy rate
is considered a healthy vacancy
rate in the region at which
landlords and tenants have equal
bargaining power.
Weirdest two point 823% vacancy
rate right now with which means
it's total in the landlords
favor and with 5% of the housing
market pulled off if even half
of that were actually
potentially available for rental
we could turn this into a
renter's market just by making
that housing available.
This is the actual numbers that
were produced mesa however
stepped up blessed with on the
sand. For producing these
numbers reports --
What would we be looking forward --
To adequate site standards --
We should be requiring --
In with arena.
Must identify there's land
available but it doesn't
actually have to be is on for
housing when is included in our
housing element has to be put
the potential has to be there.
But I think we might ask
municipalities to half subject
because that is how we're going
to get to buy right development
in these municipalities.
We also need I think to increase
our improve our data collection
requirements --
Improve protocols by which we
identify what price point a
product is entering the market
place.
And also to better understand --
The loss of naturally affordable
housing because we we talk a lot
about expiring affordability and
that refers only to that which
is covenant at that which is
supported by public subsidy.
The vast majority of court in
court affordable housing we have
lost in the last decades has
been naturally for the housing
bid up.
A rented up by middle income
residents like look at north
park in city heights of classic
examples of this --
And I think it's it's would also
the state would help was better
identify when speculative
pressures are driving up costs
because even in the discussion
about rent control the goal
there is to is to remove
speculation from the market
place not to read not.
To not to impair production and
not to to degrade the housing
spot but to take the speculative --
Interests --
To reduce those impacts on the
actual price of housing is a
number of ways that speculation
comes in which is short term
vacation rentals as one sure
speculation were investors come
and take an existing building.
By for high price and rented up
at a higher rate no new housing
is being produced but the rents
can sometimes go a 50% or more.
Up it's worth pointing out what
a type of data collection also
some numbers been thrown around
about housing production costs --
My look misinterpret
recollections of the how for the
past five years so that's below
some of the the larger numbers --
I also know examples --
Interfaith housing I was St
seniors was about two hundred
and forty thousand a unit and
the whole reason there was the
land was banked.
In these whistles bottle low
price when we look at solutions
land banking public land trust
and other things of come earlier
today certainly have some real
value -- So
another thing I would I would
recommend that we do maybe it
legislatively it's to look at
some off market housing measures.
Enabling legislation --
That would make it easier for
municipality to control short
term vacation rentals maybe
provide bumper guard so that
it's not a considered a taking
but makes it easier because we
all well know what happened
locally.
And it is a terrible problem and
you see speculation going into
that as well people over pay for
properties because they can
anticipate that they can use in
the short term vacation rentals
rather typical rental --
We also could be looking at
second home mortgage interest
deductions that was looked at
previously as with financing --
You what what what we're doing
is we are subsidizing people
have to homes and our people
right now who have none and I
think we need to be looking at
whether.
The purpose of mortgage home
interest deduction --
It inflates the cost of the
stock and it it --
In incentivize people to on more
housing than they actually use --
Finally I would say --
In conclusion the development of
it at go to relieve the pressure
on lower income households.
At portions of this market are
never going to function for all
residents even in the moderate
income you talk to developers
how low could you actually bring
the price.
They struggle to so that they
can bring something to the one
twenty written.
1100% AM might with just natural
market forces all the
deregulation in the world I'd
love to solve that problem I
believe it's going to take a
public intervention funds or
other special considerations.
And if we do that we need to
make sure that housing stays in
that housing costs bracket that
we don't simply put housing out
there that is then flipped.
And and rises to a two new
higher level --
I with other things we could be
doing is --
Local revenue sources we need
local revenues as other regions
have done.
Apps lowering the threshold for
housing bonds and expanding the
breadth of application for those --
Better coordination
transportation and land use of
how we spent transportation
dollars that in support of
housing production.
When since US and transmit three
comes along let's require that
these funds be spent things like
that half road expansion Mister
wearing was talking about could
very well have been a regional
cost that was born not something
apply to the individual units --
And I do think that the creation
funding of land trust could be
critical if we create a land
trust the you have to continue
to feed it money to be able to
grow its its mission.
But it is a way of making sure
the housing comes on the market
below market.
And stays there overtime others
are a number of ideas we have.
Time I will let.
Find him.
To be in.
So my friend Helen I we
California be where a new
housing advocacy organization --
That advocates for state
legislation to make California
affordable and accessible --
For everyone --
Insuperable races but was like
we believe that California's for
everyone --
Whether a migrant from Ohio El
Salvador or if your right here
from San Diego --
We believe that everyone.
Should be able to achieve their
full potential --
Enjoy --
Quality schools access to good
jobs in safe secure a formal
housing --
Unfortunately as piping was --
Mentioned this sort of
California dream has become a
California nightmare for
millions of us are for to many
Californians are burdened with a
very high rents that just keep
on increasing --
And have no hope at achieving
their dream of Californians
cities have made it more costly
time consuming.
Difficult in a legal to build
enough housing to keep up with
population growth.
During the nineteen sixties
seventies and eighties Los
Angeles for instance made it
illegal to book apartment
buildings and condos in most
their neighborhoods including
the neighborhoods where they had
long been a permitted.
The result is that LA zone
capacity went from ten million
it to three point nine million
even as the population increased
by 40%.
Spiking rents rising
homelessness and lower rates of
homeownership were predicted and
unfortunately all came to a
fruition.
So short when a crisis --
And in a crisis leaders need to
take decisive action to solve
the problem.
So we need to be done well as
several independent analysts
have suggested we need to build
three point five million homes
within that.
The next a decade in in order to
do that the state legislature to
pass a sweet a policy changes to
get California Boeing again.
First.
The legislature must reverse the
down zoning of the past in.
Legalize apartment buildings and
missing little housing areas
well served by transit and jobs.
The state should build on the
success of a success rate one
unit of legislation and help
increase our construction
throughout the state.
Also known as easy use granny
flats are cheaply built around
as long as owners of regulations
don't get in the way.
The state must streamlined the
production of housing that
complies with the rules of local
governments. Forty years ago the
state passed the permit
streamlining act.
Yet permits or anything but
streamlined --
It's long past time to close --
Those of the that the state must
also curtail the ever increasing --
Fees that local governments and
special used districts impose a
new homebuilding as previous
palace and mentioned we're
taxing we most need new homes.
Which ensures that --
Homes are only built at a time
when prices are very high.
At the state passed a bill
called the mitigation fee after
thirty years ago but it too is.
Riddled with the house of the
polls that and and the speed
dressed --
And I just really want to hit on
appointed early panelists made
[inaudible]
Benefit everyone.
For everyone --
If if you think of that
civilization is a worthy goal if
you think that social democracy
is a is a worthy goal than it's
worth paying --
For you don't decades ago of
former housing activists
recognize that these impact fees
reform exclusionary zoning.
I challenge people to go back to
the man that would like nineteen
seventy one yellow review
article that Paul Devon off road --
What the tiny of advocacy
planning he's calling out --
It infrastructure fees on on
homes as being exclusionary and
locking out lower and middle
income people because it does --
Does he like to really address
the crisis.
California needs to take a page
from.
The previous time in history
with is a national emergency in
over two and bill temporary
workforce housing to house the
carpenters labors and trades
people that we will need. To
build a California tomorrow --
We also need to dismantle local
governments of the revenue at
that they need to adequately
address the needs of low income
Californians.
On twenty twenty there'll be a
ballot initiative --
To eliminate property
protections for many commercial
properties this measure could
race at six to ten billion
dollars a year --
That's a lot of money and I am a
huge proponent of it.
And I also think to your point.
That we need to take a look at
the more at the state mortgage
interest deduction --
It many studies have shown that
it does not actually promote
first time --
Homeownership the the tax
savings is to capitalize into
the cost of housing about making
it a more expensive and the fact
that we haven't second homes.
Is just.
The criminal.
We need to hear that --
I but you know we spend billions
of dollars every year on the MIT
select.
What would it just California
budget look like I mean not in
the pre it's of legislation --
And if we were really serious
about -- And
me and then the needs --
Of a Limón Californians than
what we will be spending five
billion dollars a year on the
mortgage interest at a deduction --
And so I just close by saying
that our our housing challenges