Relocation help OK’d for Foster’s Landing residents

Seventy-four BMR units are scheduled to become market rate between Dec. 31, 2020, and Dec. 31, 2023, in four phases, increasing rent and forcing longtime residents to move. Phase 1 consisted of 50 units set to expire on Dec. 31 but had its BMR affordability preserved until Dec. 31, 2021, after an agreement between the city and the apartment complex owners, Essex Property Trust. Phase 2 would be an additional four units that expire on the same date. Phase 3 has 10 units expiring at the end of 2022, and Phase 4 has 10 units in 2023.

Foster’s Landing reached an agreement with the city in 1986 to keep 15% of units affordable for more than three decades. Essex purchased the building and assumed the affordable housing agreement with the city in 2014. The affordable housing agreement’s expiration will displace around 74 households, of which only 14 have relocated. Lack of affordable housing vacancies, costs associated with moving, rent deposits, limited income, transportation and COVID-19 remain obstacles to moving.

The program would use Tenant Relocation Assistance Fund 138 to provide financial assistance to relocate to a new home before the expiration of the resident’s unit. When a unit is vacated through the Third Amendment Agreement, Essex agreed to pay Foster City the rent differential between tenant paid rent and market-rate rent toward the fund. Fourteen vacated units have generated $164,998 for Fund 138. The program would be self-funded after the city reached an agreement with Essex to help provide funding.

Reimbursement for residents will have a cap of $10,000 at $1,000 a month for Phases 2 through 4, while Phase 1 has no cap and is based on rent differential between the BMR rate and the renting market rate. If a resident pays $400 for the unit and Essex later rents it for $2,400, the resident would get the difference, Councilman Sam Hindi said. The city will now move forward with relocation assistance for tenants and the tenants who have already relocated.

According to a city report, “the Early Relocation Assistance Program would provide a household in Phase 1 of the Foster’s Landing BMR program with relocation assistance in the amount equal to the monthly household rent differential multiplied by the remaining months left until end of subsidy period. This would give the tenants an option to use the rent differential as either a rent subsidy to remain in their unit until Dec. 31, 2021, or to utilize the same funds for relocation assistance.”

Hindi said the council’s initial desire was to keep residents in the units through purchases but could not because of a lack of funds and a willing seller. Its goal was to prevent homelessness and displacement of residents during COVID-19. Hindi said the city is trying to buy residents time to move to another property, whether in or outside Foster City. He stressed that the city did everything it could to find other options.

“We cannot, and we do not have, the financial means to continue to subsidize these units, plain and simple,” Hindi said.

While the state provides direction on addressing affordable housing in the future, Hindi believes it needs to step up to help with current issues around affordable housing, as Foster City will lose 74 affordable housing units that hurt its overall affordable housing future. Of the 14 people who have moved out so far, some went to other BMR units in Foster City, while others moved to other parts of the Bay Area or different states.

“It’s really a tragic situation. This is not unique to Foster City; this is happening up and down the state,” Hindi said.

The council also discussed affordable housing and what should be done in the long term to address it. Councilman Patrick Sullivan said the city in the near future should consider some type of ownership through the city to subsidize housing or work with Foster City apartment owners with vacancies to have BMR units.

“I think that we have to explore more avenues to work with the other apartment owners, and maybe those apartment owners can get some kind of tax credit to their advantage and also be contributing to the community,” Sullivan said.

curtis@smdailyjournal.com

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