Open Forum: Tech, not recalcitrant cities, is the root of our housing crisisBy Eric Filseth May 28, 2019 Updated: May 28, 2019 5:17 p.m.
1of4A BART train moves by new, luxury condo construction on Trinity Avenue in Walnut Creek, Calif., on Sunday, May 5, 2019. State Sen. Scott Wiener's SB50, besides allowing denser housing near transit, would wipe out single-family zoning in many suburban cities and allow apartment construction in such areas.Photo: Carlos Avila Gonzalez / The Chronicle
2of4California state Sen. Scott Wiener, D-San Francisco, who put forth a controversial proposal to increase housing near transportation and job known as Senate Bill 50, saw his bill relegated to the suspense file. Cities largely oppose the bill because it will transform single-family neighborhoods by requiring more apartments and condominiums.Photo: Rich Pedroncelli / Associated Press
3of4A man walks past a building on the Google campus in Mountain View, Calif. Voters in a Northern California city will decide whether Google and other tech companies should help pay for the traffic headaches and other problems that have arisen as their workforces have swelled during the past decade. The city council in Mountain View, California, Photo: Jeff Chiu / Associated Press 2015
Senate Bill 50 argued cities can’t adequately manage local zoning for housing. Many voters disagreed, yet housing affordability still consistently polls with voters as a top-priority problem. How is this possible?
Bay Area voters understand the root of our housing crisis is not local officials — the political narrative — but enormous tech demand for housing. The region has generated vast wealth, but hasn’t invested enough of it in the housing and transportation needed to support its expansion. Instead, those costs have fallen on communities. SB50 continues that, and communities know it.
Voters also know SB50 departed from its elevator pitch of housing near transit — nearly all of Silicon Valley is jobs-rich, with relatively little near transit — and tilted rigidly to the left about local control and zoning for single-family homes. That’s nutty. It surely says something about a bill when you have to buy its political support by handing out exemptions, as was done for Marin.
Wisdom prevailed in Sacramento and the bill was shelved. Now let’s refocus on the problem.
It should be staggeringly obvious by now that we’ll never fix this until we explicitly balance future housing growth and job growth. Until then, we’ll lose ground every day, no matter who owns zoning. When in a hole, first stop digging.
That’s do-able. Cities don’t build housing, but we do approve commercial developments. We can condition these on including adequate housing. Physical housing, not rezone-and-hope for housing. Add a job, add a bed — or fund one.
That may sound fanciful, but cities are starting to actually do it: Mountain View in its North Bayshore district, and Santa Clara County as a condition for Stanford’s expansion. Palo Alto’s office caps, plus upzoning — including a few SB50 elements — do it, too (if clunkily).
Of course, this ultimately lays the cost of new housing on developers and tech companies — not everybody likes that.
Cities can be reluctant, too; it’s tempting to green-light lucrative commercial projects, but export the housing costs elsewhere. Yet as long as cities approve projects that add 25,000 jobs but only 1,680 dwellings — like one in South Bay that breaks ground next month — regional homeless rolls will swell. That’s what Sacramento should regulate: Not “give us your zoning,” but “stop exporting housing deficits onto your neighbors.”
The second elephant in the room is housing mix. Affordable housing simply can’t be built without subsidies. SB50 et al. skirt this, and so serves only high earners. Our problem in Palo Alto isn’t attracting high earners; it’s keeping low and mid-wage earners.
Everybody in town knows only 10% of our teachers and 7% of our city staff live here. Since 2015, we’ve spent $28 million on affordable housing, with strong resident support. It’s not enough.
We analyzed it: Each square foot of new commercial space here creates demand for $264 of affordable housing. Yet Silicon Valley commercial development “linkage” fees to fund affordable housing, including ours, run $15 to $35 a square foot, far below need. Raising these fees (as Santa Clara County has, to $68 a square foot) makes sense, as do new business taxes. Every Silicon Valley city watched Mountain View and East Palo Alto pass 2018 “tech taxes” for housing and transportation.
Thus a coherent policy alternative to Sacramento’s 200-bill scrum: Balance job and housing growth via commercial approvals, and raise linkage fees to fund affordability.
I hope Sacramento will work with cities, instead of against them. Most of us would welcome state incentives and maybe even disincentives around the former, and co-funding around the latter.
There’s been an awful lot of ideology on this issue, and not enough problem solving. Too much of the dialogue has fallen into the unproductive “if you disagree with me, you must be a venal person” mentality that pervades so much of American political culture. That’s not helpful.
We have an opportunity to sit down and focus on the problem, instead of the divisive and ill-considered distraction that was SB50. We should take it.
Eric Filseth is the mayor of Palo Alto.