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Guest perspective: Where did middle-class home ownership go?
August 11, 2014, 05:00 AM By Art Kiesel

Municipalities within the Association of Bay Area Governments that includes all jurisdictions in the nine Bay Area counties are required to adopt an updated Housing Element to their General Plan. ABAG periodically looks at the job and population growth within its jurisdiction and assesses the related housing needs for the increased workforce. As part of the assessment come the requirements for affordable housing which is allocated to the individual jurisdictions.

The process requires the preparation of a draft to be sent to the California Department of Housing and Community Development for a 60-day review followed by responses to their comments resulting in a certified Housing Element. To have the Housing Element last for a period of eight years, we must have one adopted by Jan. 31, 2015. The consequences for the failure of not making the Jan. 31 date is that the Housing Element process must be redone in four years instead of eight. There are other benefits to having a certified Housing Element in the form of funding, that we have used for streets and parks and for protection from some legal challenges to an inadequate Housing Element.

Part of the Housing Element addresses affordable housing by categories (very low, low, moderate and above-moderate). For developers to include affordable housing in their profitable projects, outside subsidies have been required. With the dissolution of redevelopment agencies, subsidy funds have been more difficult to come by and as a result, creative funding methodologies have been explored and some are being implemented.

Much time has been spent, and rightfully so, on affordable housing issues. The need for affordable housing has been around for many years with some success but more needs to be done and the dissolution of redevelopment agencies by the state has not helped.

We live in a housing market that appears to be somewhat immune to recessionary times as prices for housing for both purchase and rental/lease continue to escalate at unheard of rates. The dollar difference between no-housing and housing continues to widen, offering little to the middle class. Those already in purchased units continue to relish the benefits of increased property values while those in rental units continue to see the rents/leases rise with ownership getting further and further out of their grasp. For those looking to move into the area, many find difficulty qualifying for rental units and many more are priced out of ownership. In future years, will we see the demise of the middle class when it comes to home ownership? The fact that collectively, we have little need for either air conditioners or snow shovels is a testament to our desirable temperate climate. Is it possible that the lifestyle we have become accustomed is about to change?

The southern part of the Peninsula has long been known as Silicon Valley and that term has resonated throughout the world. In recent years, the Peninsula has had a growth presence in the biotech industry. These industries have helped create the need for a sustained venture capital industry and have brought a level of prosperity to our beloved Peninsula.

Back in July and August of 2013, I wrote about One Bay Area Plan, which is ABAG’s answer to reducing greenhouse gases by focusing on higher density housing reducing the need for gas burning automobiles. Since we are running out of buildable land, we are redeveloping living quarters with higher densities and fewer parking accommodations. Housing will be built within walking distance of transportation corridors (El Camino Real and Caltrain). Although the plan presents some workable solutions, it fails to address some impending traffic problems created by new workers unable to find affordable housing on the Peninsula and so must live in the East Bay and commute to the Peninsula. A look at the Highway 101/ State Route 92 interchange traffic during the morning and evening commute hours has to be a prelude of things to come.

Also, I pointed out then that the plan did not adequately address the requirement for water for the additional housing as we are now scrambling to solve our severe drought. In May and June of this year, I wrote about some of the water issues facing us and with the eminent climate change, can we truly expect business as usual? Will incubator businesses continue to start up on the Peninsula with the high cost of housing and perhaps building or expansion moratoriums? Is it possible that new business will look to less costly locations to start up?

These are difficult questions to answer, but if we do not recognize and ask the questions now, we may not look for answers until it is too late.

Art Kiesel is the vice mayor of Foster City. He can be reached at or 573-7359.



Tags: housing, element, peninsula, affordable, years, continue,

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