Congratulations to the City of San Mateo on receiving housing element certification! 

The City still faces a lawsuit from the Housing Action Coalition disputing their projections for housing production under current zoning. Though HLC also questions whether San Mateo accurately calculated housing capacity, we support many of the policies in the city’s housing element, including

• Reduced parking requirements from 1.5-3 spaces to 1 space per studios and 1 bedrooms, 1.5 spaces for 2 bedrooms or more
• Streamlined entitlement processes, such as the elimination of a pre-application requirement and ministerial approval for multi-family developments smaller than 25 homes
• Expansion of just cause for eviction protections, including relocation payouts from Day 1 of tenancy
• A commitment to update the city’s General Plan to allow increased heights and densities. 

San Mateo’s housing element is just a start. In order to realistically meet its housing goals, the city will benefit from treating its policy commitments as a foundation to build upon with even stronger policies.

In order to successfully implement its housing element, San Mateo voters now needs to pass Measure T, which will allow for greater heights and densities along transit corridors and business areas.

Last Wednesday, San Mateo County’s Board of Supervisors heard an informational session on a prospective ballot measure to authorize affordable homes pursuant to Article 34 of the California constitution. HEART, the County’s regional housing trust, requested the County to consider a ballot measure so that HEART could pursue an innovative new preservation program. 

The Supervisors directed the County to pursue an education and listening program with the cities of San Mateo County to develop a measure that will promote affordable homes pursuant to Article 34, to be placed on the ballot during a later election cycle.

First passed in 1950, Article 34 “appealed to racist fears about integrating neighborhoods” with the intent of keeping affordable housing and communities of color from entering certain areas. Article 34 requires all publicly subsidized low-income housing to undergo a ballot referendum.

The proposal initially under consideration by the Board of Supervisors would allow the County to annually acquire or build low-income housing amounting to 1% of total units countywide, currently amounting to approximately 2,900 homes, without the need for such a risky and cost-prohibitive process. After discussions with cities and community members, the BoS may adjust a future ballot measure to promote affordable homes.

The state legislature has passed narrow exemptions to Article 34 enabling the development of some affordable housing, but those exemptions are limited in scope and risk legal challenges. Passing a measure pursuant to Article 34 would allow San Mateo County and its constituent cities to: 

• Acquire existing affordable homes in danger of converting to market-rate and keep those homes permanently affordable.
• Acquire existing market rate homes and convert them into affordable homes and develop new homes at a range of incomes onsite.
• Engage in land banking, the acquisition of old/vacant/blighted/underutilized properties for future redevelopment, renovation, or use. This will maximize land use.
• Function as a public developer and build affordable housing directly.
• Have actual local control. When local jurisdictions own land, they will be able to dictate the entirety of its use: labor standards, environmental standards, proportion of affordable homes, and deeper levels of affordability of what is built. Cities and the County would control every dollar of revenue generated by new development. 

Leading up to the board of supervisors meeting, the San Mateo Daily Journal published an outpouring of support for legalizing affordable homes pursuant to Article 34. Some of our favorite snippets include:

• Article 34 measure will help with naturally occurring affordable housing: “As a government agency, HEART is subject to Article 34. HEART needs San Mateo County voters to allow local government agencies like HEART to acquire and preserve housing for lower-income residents.” —Glenn Sylvester, Daly City council member
• Support county’s Article 34 effort: Article 34’s “purpose—and impact—was to replace racially restrictive zoning with a new tool for racial and socio-economic exclusion.” —Karen Grove, Menlo Park
• Local control under Article 34: “The county and other agencies wouldn’t be able to build any new housing without approval of the duly elected city council. Let’s restore local control over affordable housing by supporting the county’s ballot measure.” —Cathy Baird, San Carlos
• Let residents have a voice on Article 34 ballot measure: “Millbrae has spent $300,000 suing the county to force a countywide vote on Article 34 and now the city is actively fighting against placing an Article 34 measure on the ballot. Do Millbrae’s leaders support the right of residents to vote on housing or not?” —Jess Hudson, Millbrae
• Avoiding governmental paralysis: “The voters do not need to be directly involved in every niggling little detail, and trying to force them to be involved just results in paralysis — which was the entire point of Article 34. ‘Council can’t do what the voters elected them to do, because we made it expensive and complicated’ is not local control.” —Auros Harman, San Bruno planning commissioner

HLC is grateful to the Board of Supervisors for their support of community outreach and education regarding Article 34. We look forward to supporting County efforts to increase opportunities for affordable homes.

Earlier this month, San Mateo County unveiled plans in its 2024-2025 budget to create a new real estate development team, allocating $940,332 to fund five staff positions. The County’s investments reflect HLC requests for more planning capacity to ensure the County can fully implement its housing element objectives and manage its affordable housing portfolio.

Like most jurisdictions in the Bay Area, San Mateo County projects structural deficits over the next several years. A number of factors put pressure on the County budget: lower-than-expected property tax receipts, potential state claw back of various funds, cuts to statewide Human Health & Services programs, and unpredictable inflation all factor.

As a result, the $4.2 billion budget is approximately $600 million smaller than last year’s budget. Most of the deduction occurred because of the completion of major capital projects, but the County’s financial situation could change drastically depending on the choices of the governor and state legislature.

However, investing money in staff capacity now will save the County money down the road. Due to delays in its housing element update, the County has already lost access to state grant funding in 2024–funding that ordinarily would have supported implementation of housing element goals, such as rezoning.

By investing adequately in housing staffers, the County will ensure it can achieve and maintain housing element compliance, creating new opportunities to secure funding for housing initiatives.

Furthermore, the County’s growing portfolio of land presents opportunities to raise revenue. A few weeks ago, the County purchased a 132,000 square foot Office Park in San Mateo; earlier in the year, they bought the 50-acre Bay City Flowers Property in Half Moon Bay.

Both properties present large redevelopment opportunities that could deliver thousands of new homes. By strategically rezoning the sites, the County could potentially generate millions of dollars. By investing in its housing department and real estate development capacity, San Mateo County is investing in its future.

Those in attendance at last Wednesday’s (5/8/24) night’s community meeting in South San Francisco witnessed a powerful display of unity as residents from across the city came together to voice their support for much-needed affordable housing and anti-displacement strategies. With growing frustration over the misrepresentation of community needs by anti-housing groups, residents are demanding real solutions to the pressing issues of displacement and housing unaffordability.

Since our organizing efforts in South San Francisco began, we’ve learned that habitability, home affordability, and displacement are top priorities for South San Francisco residents. People love South City and want to remain here, but unfortunately, many are being forced out, sometimes to neighboring cities or even as far as the Central Valley.

Displacement is not just about being unable to afford rent; it runs much deeper.  Aside from being formally evicted, many tenants are forced out due to landlord harassment, which includes living in substandard housing conditions because landlords refuse to maintain habitable homes. 

The consequences of displacement are dire. Displacement leads to homelessness, substandard housing, overcrowding, and pushes families to move far from their communities. Displacement causes trauma, particularly for children. It’s time to put an end to this cycle and ensure that everyone has the right to stable, affordable housing. It is time for strong anti-displacement measures, and it’s South San Francisco’s turn to implement them.

On Wednesday the South San Francisco City Council voted 4-1 to approve the charter for the Community Advisory Committee for the Residential and Commercial Anti-Displacement Roadmap. It’s important to note that an advisory committee whose purpose is to study and make recommendations is an easy starting point for a city wide conversation but tiptoes around immediate policy action that the city could champion at any time. While this decision is not the bold anti-displacement plan that residents urgently need now, it is the pathway to create such a plan. We are looking forward to amplifying and supporting the residents who are harnessing their collective power to unshakably support strong anti-displacement policies and new deeply affordable housing which is needed to curb the ongoing citywide displacement. 

A recent UC Berkeley Research Brief sheds light on the severity of displacement in San Mateo County. “Between 2000 and 2015, the county lost 44 percent of its naturally occurring affordable housing for low-income households. In 2015 alone, there was a shortfall of 25,882 affordable rental homes. Shockingly, between 2012 and 2015, evictions for non-payment of rent increased by 59 percent, and “no-cause” evictions skyrocketed by 300 percent. These evictions disproportionately affected Latinx and African-American households and were enabled by the lack of significant rent control or just-cause eviction protections in most cities in San Mateo County, apart from East Palo Alto.” 

To learn more about the displacement crisis in San Mateo County, we recommend reading the full UC Berkeley Research Brief. Together, we can make a difference and ensure that South City remains a place where everyone can thrive.

Over the last three weeks, city commissions in various parts of San Mateo County have stalled plans for affordable homes on sites included in the housing element. In Redwood City, the Architectural Design Review Commission unanimously recommended the council reject plans for 85 affordable homes at 847 Woodside Road. Half Moon Bay’s planning commission has twice rejected plans for 40 homes affordable to farmworkers planned for 555 Kelly Road. Both projects are included in their cities’ housing elements. 

If cities like Half Moon Bay and Redwood City want local control over land use, they need to be responsive to the housing needs of their communities. The shortage of affordable homes for farmworkers and others may have no immediate impact on the individuals that serve on commissions and their comfortably housed supporters, but it has a huge impact on the working class members of our communities. Redwood City’s planning commission and Half Moon Bay’s architectural design review commission should support their respective affordable housing proposals to move forward without further subjective stipulations.

Both cities are responsible for planning for housing on these sites due to commitments in their housing elements. Redwood City’s housing element includes plans for housing at 847 Woodside Road based on an earlier proposal to build 44 homes for ownership on the site, including 37 market-rate and 7 affordable (see page 155 of the RWC housing element). Though the current proposal at 847 Woodside Road is larger than originally planned in the housing element, the increased density is necessary to make a new project pencil under tighter market conditions. 

HLC sent a public comment to Redwood City on Monday, May 6 detailing steps the city can take to facilitate development at 847 Woodside Road and remove barriers to future projects. Most significantly, the city should encourage eligible projects to take advantage of SB 35 and other environmental streamlining lawsfor infill housing, which is inherently sustainable. 

On April 30, 2024, HLC sent a comment letter to Half Moon Bay’s planning commission describing the legal justification for approving the farmworker housing. Under current law, the planning commission has an opportunity to work with the developer to make marginal improvements. However, if the planning commission continues to make infeasible demands, developer, Mercy Housing, could use state laws coming into effect in 2025 to propose a much larger project. 

One of the most significant laws, SB 423, builds off existing state law, SB 35, to streamline an eligible housing proposal. SB 35, passed in 2017, requires ministerial processing–meaning no public hearings–of eligible housing projects in jurisdictions that do not meet their Regional Housing Needs Allocation (RHNA) target. SB 423 extends SB 35 to most properties in the coastal zone. The City of Half Moon Bay will be subject to SB 423.

Another law, AB 1633, makes it harder to abuse environmental laws to stall housing production. Specifically, AB 1633 expands the Housing Accountability Act’s definition of what it means to “disapprove the housing project” to include a city’s failure to make a determination of whether the project is exempt from CEQA or commits an abuse of discretion in that determination. This opens up a cause of action for applicants to sue local agencies that use CEQA delays as a means to effectively disapprove, render financially infeasible, or downsize a project without having actually voted to do so.

Read HLC’s public comment letter to Half Moon Bay’s planning commission to better understand these laws. 

Last week was the big hearing on the lawsuit Millbrae brought against the county in an attempt to block permanent homes for families and seniors that are currently experiencing homelessness. Now the three council members that brought the suit, Mayor Anders Fung, Anne Schneider, and Gina Papan have until the judge issues her final ruling, expected no later than June 26th,  to drop the case.

Why should they drop the case? Why is this such a terrible decision? 

San Mateo County has about 100 people that are on a waiting list for permanent supportive housing. These are seniors on fixed incomes that had rent increases they could not afford, or health emergencies that caused them to get behind on the rent. These are families fleeing domestic violence. These are working people that simply do not earn enough to keep up with rent, health care bills, food, and transportation. These are people that might serve you at the grocery store, they might look after your parents, they might teach your kids. These are people that are part of our community and they need help. Blocking housing for our most vulnerable neighbors is shocking and shameful. San Mateo County can make homelessness rare and brief, but we need leadership, especially from city council members.  For more information about ending homelessness, here is a resource from our friends at All Home: https://www.beginswithhome.org/

Help Support Homes for Homeless!

 

Though cities can always do more to promote housing affordability, many of San Mateo County’s jurisdictions deserve recognition for the changes they are making. Last week, HLC’s newsletter incorrectly claimed “not a single lower-income unit was proposed in the city [of San Carlos] in 2023.” 

In fact, according to San Carlos’s Housing Element Annual Progress Report, more than 300 homes were approved by the San Carlos city council in 2023, 30 low-income and 47 very low-income. Recent work by the city to rezone and change other development standards will make more projects easier to build in the future as well.

A number of factors can influence when building or occupancy permits will be issued, including those like higher interest rates or the timing of development submissions that are outside the city’s control. Understanding what permits a city has issued in a year requires reviewing the full Annual Progress Report. Mea culpa! 

A thoughtful commenter responded to our newsletter that: “I do not live or work in San Carlos, but after so many years of little housing being built there, the change is quite remarkable. They should be complimented on their efforts.” HLC agrees. 

At the same time, cities across San Mateo County can continue working to change what they do control in order to make more development happen faster. Many developments proposed across the Bay Area have stalled because of higher interest rates, inflation and the increasing costs of building material, and the lack of capitol; all of San Mateo County’s jurisdictions saw a steep drop in the rate of building permits. However, cities are not passive actors. For many projects, cities still control most aspects of development, such as approval timelines, the flexibility of development standards, and fees. 

Planning for housing does not only happen in eight-year cycles or 20-year general plans; planning can be a continuous process of revision that responds to prevailing conditions and community needs. To say that cities have no control over housing development in the face of rising interest rates is like saying FEMA has no ability to respond to a hurricane disaster. No, FEMA cannot stop a hurricane, but it can help facilitate recovery. No, cities cannot save every development that has stalled due to bad financing, but they can save many of them and make new developments possible–even in a high interest rate environment–with proactive policy change, both by implementing housing elements and by looking beyond them.

Other cities in California demonstrate housing production is still possible. In 2023, the City of Sacramento (population ~550,000) issued more building permits than all of San Mateo County combined (population >750,000), the vast majority of permits for infill multi-family housing. Both the urban core of Sacramento and bayside San Mateo are largely “built out,” meaning most lots have a structure on them, but Sacramento is redeveloping more parcels at a faster rate than the San Mateo region.  

Caption: A table from Sacramento’s APR staff report

Sacramento makes housing easier to build in a number of ways. The vast majority of housing proposals are approved ministerially, without costly, time-consuming public hearings. The city has a local density bonus program that strongly rewards density, so that even proposals that are technically not zoning compliant can easily receive waivers and still get ministerially approved–and it has more flexible zoning, with more widespread multi-family zoning, to begin with. Furthermore, the city imposes more modest fees, with fee waivers or reductions for lower-income housing. 

Ultimately, entitling projects is only part of the process of building housing. The projects that get entitled need to actually be feasible to build. The things cities control–zoning rules, fee reductions, and fast, predictable timelines for both entitlements and building permits–directly impact development costs, influencing what developers can propose and what they can finance. 

Housing elements for the 6th RHNA cycle, though they include historic new policies leading to historic changes, may be just the beginning of the policy change necessary to enable the housing our communities need. 

Portola Valley has become the first city in the Bay Area, to have its housing element decertified by the state Department of Housing and Community Development (HCD). 

The decertification occurred because Portola Valley violated one of the most unambiguously clear areas of housing element law: Rezoning deadlines. If a housing element is not certified by May 31, 2023, then rezonings must be completed by January 31, 2024 or a city cannot possibly be in compliance with state law. As of March 26, 2024, the date of its decertification, Portola Valley had still not rezoned. 

HLC remains committed to helping jurisdictions achieve and keep housing element compliance. We believe that HCD, which gave Portola Valley almost two months after the deadline to complete its rezoning, will work with jurisdictions to get back on track with delayed policies before revoking certifications. 

Portola Valley received certification from HCD on January 31, 2024, although the town had not yet completed its rezoning. The town received certification in large part because of years of effort by the council, staff, and community leaders to create a credible plan for the first multi-family housing in the town’s history. Some of the commitments in Portola Valley’s program, such as the dedication of a 2.5-acre publicly owned site for affordable homes, will create more tangible housing opportunities, while others, including an opt-in rezoning program, are downright innovative. 

After the 2022 election, some of the newly elected leadership delayed the plan and watered down some of its most impactful policies, repeatedly pushing back the housing element adoption date. Politically motivated delays led the town to fall behind on its housing element update. By the time Portola Valley achieved certification, it was already supposed to have completed its rezoning, but the town lacked the resources to pursue both the housing element update and rezoning simultaneously. 

On one hand, the resources required for housing element updates can absorb a city’s available capacity. On the other hand, Portola Valley has held 47 meetings related to its housing element, as reported by The Almanac, and they are short staffed after resistance to housing by the council caused most of the planning department to resign. 

HLC hears from local elected officials that they want local control over land use, that their city can solve the housing crisis given enough time and resources to plan. The housing element gave cities the opportunity to plan for housing on their own, and many cities, including Portola Valley, used the opportunity to plan for more affordable homes. But local control only works for housing when cities actually follow through on pro-housing policies. Now, despite the hard work by so many community members and elected leaders to create a realistic housing plan, Portola Valley faces consequences due to delays. 

From Portola Valley’s city notification announcing their decertification, “The proposed tentative schedule [for rezoning] is as follows:

• April 3, 2024 – Continuation of the March 20, 2024 Planning Commission meeting as a joint Planning Commission and ASCC meeting to review ASCC’s feedback on the draft amendments.
• April 17, 2024 – Planning Commission meeting for the Commission to complete its review of the draft amendments and consider adopting a resolution recommending approval to the Town Council of the zoning amendments.
• May 8, 2024 (tentative) – Town Council meeting (first reading).
• May 22, 2024 (tentative) – Town Council meeting (second reading).”

Each year, HCD requires that jurisdictions submit Annual Progress Reports (APRs), detailed summaries of annual housing production. Last year’s APRs illustrate a bleak story: Across San Mateo County, housing development ground to a halt in 2023. 

Though cities recently updated their housing elements with more pro-housing policies, many did not account for the impact of rising interest rates. More policy changes may be necessary in coming years to restart the housing development pipeline.

Every city in San Mateo County faces similar trends. San Carlos and Foster City are not particularly unique, just examples shared with HLC by local advocates. 

Even some of San Mateo County’s most pro-housing cities have seen affordable housing production stall out. In Redwood City, at least four proposals for affordable housing brought forward under the city’s Gatekeeper process have stalled or died entirely. Most substantially, a proposal to redevelop Sequoia Station with as many as 631 new homes has collapsed, with the prior owner selling off the property and abandoning their plans for deeply affordable homes and extensive and expensive transportation improvements. 

Policy choices, just as much as the economic environment, continue to define housing outcomes. Several cities in the Bay Area, like Mountain View and Emeryville, saw a more normal rate of development in 2023, each approving more than 300 new homes. Through their housing elements, these cities rezoned for substantially more homes and streamlined their entitlement process faster than any jurisdiction in San Mateo County. 

Though San Mateo County cities recently updated their housing elements with more pro-housing policies, many did not account for the impact of rising interest rates. As a result, many housing elements made changes around the edges of their planning processes but did not pursue wholesale reform. Receiving entitlements can still take years; even after a city council approves a development, behind-the-scenes staff work can also take months or years; impact fees continue to rise, all leading to an intolerable degree of uncertainty in a high-interest-rate environment. 

Moving forward, San Mateo County jurisdictions can choose to eliminate or reduce the barriers that make building housing more difficult, going beyond the moderation of their housing elements. Eliminating arbitrary restrictions like Floor Area Ratios or maximum lot coverage requirements can increase flexibility for developers. Reducing fees increases the spectrum of what can be built. And approving more projects ministerially, reducing need for time-consuming public hearings and the expensive burden they impose on staff, can ensure builders quickly move from entitlement to development. 

If local jurisdictions are not on track to meet their Regional Housing Needs Allocation goals by 2027, approvals for housing automatically become ministerial. HLC remains committed to help cities maintain their local control by adequately planning for housing on their own.