Report: San Mateo County’s affordable housing falling short

“There are powerful forces at work in San Mateo County opposed to building equitable housing,” Terry Nagel, chair of Sustainable San Mateo County Board of Directors, said. “Political will is really the essential ingredient to get this going.”

Between 2015 and 2021, 75% of new housing permitted in the county, 9,717 units, was affordable only to households with “above moderate incomes,” defined as those earning $179,500 yearly or more for a household of four. 

Just 1,262 permits were issued for housing units affordable to “very low income” households, 1,211 for “low income” households and 855 for “moderate income” households. The groups are defined as having incomes below $91,350, $146,350 and $179,500 respectively for a household of four. Housing is generally considered to be affordable if 30% or less of one’s income goes toward housing costs.

Following political leadership, land use and funding are also key ingredients for building more affordable units, said Matt Franklin, president and CEO of MidPen Housing, an affordable housing developer. Though affordable housing funding has increased recently, building below market rate housing costs money, and deeply affordable units cost the most. 

If we want to offer something at an affordable rent or an affordable sales price, the reality is it requires subsidy,” Franklin said. “When we’re out building, we’re paying market rate for materials, for labor.”

And cities by themselves don’t have the funding necessary to build the amount of housing needed, Nagel said. 

“Those people in the low income and very low income … There aren’t that many slots for them because realistically the people running these programs have to have enough money coming in the door to maintain the building and keep the lights on,” she said. 

Funding sources

The primary source of revenue for affordable housing in the county is Measure K, the half-cent sales tax that voters approved in 2016. The current round of funding for affordable housing from the tax is $50 million, the most ever contributed by the county. 

State funding this year has also been record breaking. Gov. Gavin Newsom’s California Comeback Plan is the single largest investment in housing in the state’s history, with $10.3 billion for affordable housing and more than $12 billion to mitigate homelessness.

Impact fees are also a funding mechanism. Redwood City has built 600 affordable units since 2015 with another 877 on the way because of its impact fees charged to commercial developers, the report notes.

The report mentions several specific projects in the county, including a 132-unit affordable housing development in Burlingame replacing a surface-level parking lot, and a 225-unit affordable project underway in San Mateo to house public employees. Many other projects across the Peninsula are underway featuring affordable units. 

“Instead of just talking about affordable housing as a nice idea, leaders are getting very serious about making very affordable housing happen,” Nagel said.

Additionally, recent state legislation allowing for denser housing on lots previously zoned for single-family homes will help, she said. The vast majority of residential areas in the county previously allowed single-family homes only.

“We know we can do this in a more dense setting than a lot of the history of San Mateo County,” Franklin said. “San Mateo is a great example, they’ve embraced density downtown, they’ve demonstrated that you can create a great downtown in a denser living environment.”

Also noted are the contributions of land and funding from private companies including Apple, Google and Facebook toward affordable housing. 

Gaps in availability

But despite efforts, sizable gaps in housing availability still exist. For people who earn too little to afford even the most affordable housing — yet too much to qualify for housing made available to otherwise unhoused people, the options are very slim.

Estela, a Redwood City resident, brings home $18,000 a year as a housekeeper. She lives in a one-bedroom apartment with her adult son, who helps pay rent, and two teenage children. Her son contributes $600 to the $1,800 monthly rent, leaving the majority of her income going directly to housing. 

The family’s combined income is too little to afford even the most affordable units offered. Estela, who asked that her last name not be included for the sake of her children’s privacy, said she is not sure what she would do in the event of an unexpected expense or income loss.

Moving away to a cheaper area is not an option, she said via a translator. “My life is here, the kids are going to school here.”

With the use of federal rental relief funds, some affordable housing landlords have been able to offer rent affordable to households with ”extremely low incomes,” according to the report. The problem is, unlike some other affordable housing funding mechanisms, those funds are set to expire.

“If there was another category of funding that would help them that would be great, because the way the system is set up now it really doesn’t support that gap in the funding programs,” Nagel said.

Further, if 6% of extremely low-income individuals in the county lose their homes, the county’s homeless population, estimated to be 1,500 people, will nearly double, the report notes.

Looking forward, the housing to jobs imbalance in the county is only destined to get worse, according to the report. Based on a comprehensive look at developments currently planned or under construction, it’s predicted 106,000 new jobs will be added in the next five years accompanied by fewer than 25,000 units of housing in the same period of time. 

“Adequate housing is essential for human survival with dignity,” Nagel said. “There is still much work to do.”

 Go to tinyurl.com/2021IndicatorsReport to read the full report or its executive summary.

corey@smdailyjournal.com

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