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It’s Time: Endorsing a Bold New Regional Housing Idea for the San Francisco Bay Area

By Mariia Zimmerman

Across the Bay Area, local leaders from the public sector, philanthropy, the tech sector and other regional employers, and community advocates have forged a new regional housing compact. The CASA Compact, released in December 2018, is a 15-year emergency policy package to confront the region’s housing crisis head-on with strategies designed to increase housing production, preserve existing housing stock, and provide assistance to tenants facing eviction. SPARCC partners in the Bay Area For All collaborative table (BA4A) – including the 6 Wins Social Equity Network (6 Wins), the Great Communities Collaborative (GCC), which is an initiative of The San Francisco Foundation, and Bay Area Regional Health Inequities Initiative (BARHII) – were among those engaged in shaping CASA’s recommendations and that are now working to advance their implementation.

A Housing Crisis Ripe for Something New

California has become notorious for some of the most expensive housing in America today, contributing to a housing crisis at virtually all income levels.  Regions such as the San Francisco Bay Area are feeling the weight of job growth far outpacing housing production. Local land use policies, regulatory hurdles, and the high cost of land make it hard to secure financing and approvals necessary for affordable housing production. The state needs to build anywhere from 1.8 million to 3.5 million new homes just to absorb existing demand and future population growth. But current construction rates fall far short, with less than 80,000 new homes built per year.

Regional and state local leaders are responding. In 2018 voters across the state approved nearly $6 billion in new funding for affordable housing with Propositions 1 and 2. Many local jurisdictions are raising their own revenue. Both are important, but insufficient. In the Bay Area, for instance, many of the 101 cities and 9 counties have taken action to increase housing revenues but the results are spotty, the sources vary in the revenue generated, and technical capacity varies widely from one community to the next. Many Bay Area cities have struggled to build more housing after the dissolution of redevelopment agencies in 2012 and the subsequent loss of redevelopment funds. The time for bold action is now.

Working together across jurisdictional boundaries creates greater opportunity to tap innovative thinking on ways to preserve, fund, and build a range of housing options that are essential to a thriving regional economy. More regions are understanding the urgency and power of collaboration on housing issues. Some are even taking bold steps to create substantially new resources. This month the new Housing Leaders Group of Washington announced a $1 billion challenge to commit new capital resources from public, private, and philanthropic sectors. The San Francisco Bay Area is going a step further, pushing for not only increased housing funding but also to fundamentally redefine regional support for local housing strategies through the creation of a new Housing Alliance for the Bay Area (HABA).

The CASA Compact

The common refrain that housing is a “local issue” best left to cities and towns runs counter to reality — we know that housing markets are regional in nature and shaped by a myriad of cross-jurisdictional and financial factors — and undermines the ability of families across a region to find an affordable place to live. CASA confronts that challenge head on by recommending a bold new regional housing enterprise be created to act as a partner and intermediary across local jurisdictions (Compact Element #10). This new regional housing entity would support local communities by providing incentives for housing production, preservation, and tenant protections through new resources and tools. The California State Assembly just recently passed Assembly Bill 1487 to create a regional Housing Alliance for the Bay Area (HABA). This concept was first advocated by Enterprise Community Partners, one of SPARCC’s founding members, in response to the Bay Area housing crisis after examining how other regions were trying to tackle similar complex issues that span numerous localities and different types of housing markets.

HABA exemplifies the kind of innovative approach SPARCC supports and fosters inclusive investment by addressing structural and institutional barriers to affordable housing. Rather than continuing to tinker around the edges and work within a siloed and piecemeal governmental system, the CASA plan proposes a new regional entity to work across the entire ecosystem and implement innovative solutions for systems change.

Currently, the region faces a $2.5 billion gap for affordable housing and no dedicated regional source to fill it. The CASA Compact sets a target for raising $1.5 billion annually to help close this gap. HABA can be a means for tailoring funding and financial packages specific to the region’s microeconomies. If passed, AB 1487 would provide authority to HABA to raise up to $1.5 billion through ballot measures voted on in all nine Bay Area counties. HABA would not have land use authority or the power of eminent domain, but it would provide robust real estate, housing production, preservation and tenant protection expertise necessary to ensure regional housing affordability through high-touch technical assistant to those jurisdictions seeking a regional partner.

The Bay Area is brimming with underutilized publicly-owned land. Local groups worked with the Metropolitan Transit Commision, the regional transportation agency, to identify and inventory 470 parcels and close to 700 acres of publicly-owned land suitable for housing near transit. This land could accommodate over 30,000 new homes and help to reduce the high cost of affordable housing, if public disposition policies are altered to prioritize land for affordable housing and other community defined benefits.

Land is a key asset and accounts for 13% of total development costs. HABA could act on behalf of a public agency to hold, assemble and dispose of public land for housing development. It can also provide robust development tracking systems that include public lands, vacant and underutilized parcels, but also new development, unsubsidized affordable housing units where residents are at risk of displacement, and an easier pipeline for voucher holders to identify and apply for subsidized housing.

The Bay Area is positioned to follow other regions that are recognizing the power of acting across local jurisdictions to address shared regional housing challenges. Portland, Oregon, recently passed a major 4-county housing bond. In Seattle, the cities and counties are working with regional agencies including Sound Transit to fund, plan and provide technical assistance to local communities and neighborhoods working to preserve affordability. In the Twin Cities, the regional planning agency has been involved in housing plans and funding for over thirty years helping local communities plan for growth and access state and federal funding.

Will the Bay Area join this list of regions innovating to solve the current housing crisis? SPARCC is working to ensure that happens through our local BA4A partners. Inclusive investment requires new methods, and modifications to existing structures that fail to meet the current challenges our communities and residents face. Everyone deserves a place to call home. No one jurisdiction acting alone can provide this. Together, we are stronger when we act as a region, hold one another accountable and bring all of our collective financial, technical, and community experience together.