Davis, CA – Addressing affordable housing is pretty tricky. In recent years, the city of Davis has moved away from for-sale affordable housing and towards affordable rental housing.
One problem of course was trying to balance issues of equity and preventing abuses of the program while, at the same time, providing first-time homebuyers homes they can afford.
Stepping a step back, there are several problems with affordability.
The first is the cost of market rates homes has continued to soar beyond the means of middle income, first-time home buyers.
The second problem is the cost of housing construction makes it difficult to construct affordable-by-design housing in places like Davis. Moreover, when you do, the housing is far smaller in places like Davis than nearby communities like Woodland.
A recent staff report noted that, to build an affordable housing unit—just one—costs on average between 600 and 700 thousand dollars. To build 1000 such units then would cost about $600 million.
That cost makes its prohibitive for the city to generate the funding to make a meaningful dent in affordable housing.
For instance, even an affordable housing trust fund with $2 million, would only generate three or four new affordable units.
But a program that subsidizes low- and middle-income families to be able to put down the money needed to buy their homes has several key advantages.
First, the cost to the city (likely funded by grants) will be far less than the cost of building a new home from scratch. It might take just $20,000 to $40,000 per unit for a down payment rather than $600,000 to build one from scratch. That immediately spreads the impact while limiting the costs.
Second, if the city sets it up correctly, it’s more of a loan than an actual subsidy, where the homeowner repays the city over time.
Third, it allows people to buy into the housing market without limiting their equity to then purchase a larger home down the road and sell their first-time home.
Fourth, it allows the housing market to provide the supply of housing rather than go through layers upon lays of grants and other funding to build affordable housing projects.
As noted originally, all the city right now would be doing is creating an “overarching structure for a program” —the details and funding will need to be worked out down the road.
A critical point, however, is that this program by itself is not going to solve Davis’ housing problems. It’s not designed to do that. But it could become a potent tool to allow the city a more economical means to subsidize housing—especially homeownership for middle-income first-time buyers.
We still need to address supply. That’s the most important issue facing the city and there is not going to be one answer.
One thing we know is we are probably going to need several large Measure J projects in the next few years to address state mandated housing in the sixth and seventh RHNA cycles.
As former Councilmember Will Arnold noted in November, “over the course of the next few years, we need one or potentially several projects of this size, housing projects of this size in Davis, not something that you’re going to find with an ADU here and a duplex there, and a few apartments over a shopping center.”
He added, “We have a housing crisis that we are addressing, and we need a project of this size. I believe that’s undeniable.” He was speaking of Village Farms.
Previously he had noted that the city was not going to meet its future housing needs with infill.
Village Farms gives us a bit of a glimpse for how a down payment assistance program could be integrated.
At the 1800-unit project, the proposal now calls for 360 affordable housing units with 90 down payment assistance homes. That improves the affordability component of that project from 20 percent with those 360 affordable housing units, up to 25% with the 90 extra units. That starts to make a dent in what we need.
But it’s pretty clear that we need more than just one project. And probably more than just two projects.
The city in the coming years is going to have to figure out where it will get the housing to meet the current RHNA cycle and, next cycle, how to address the General Plan Update, whether to adjust Measure J, and how to finance affordable housing.
Clearly, the down payment assistance program is not going to address the supply of housing, but it can become a tool to make that supply of housing more affordable to first-time home buyers and that is something that is sorely needed.
“That cost makes its prohibitive for the city to generate the funding to make a meaningful debt in affordable housing.”
LOL, I’m sure the city is capable of creating a “meaningful debt”. Was that a Freudian slip?
“b” and “n” are next to each other on the keyboard – but yeah, nice little typo
This could be a useful part of an affordable housing strategy, but I urge the council to make every effort to make it fiscally self-sustaining, and also to take David Thompson up on his offer to provide an overview of the history of affordable housing programs in Davis. I am not an expert, but in following stories and conversations about this over many years I believe that his comment:
” this issue relating to city assisted single family affordable home ownership has been plagued with horrendous abuse, excessive municipal legal and administrative costs, lack of oversight and unfettered favoritism.”
… is, if anything, an understatement. The council subcommittee would do well to meet with David. He knows more about this than anybody else and could give some guidance on how to avoid those pitfalls.
Also, the program should probably sunset in a few years so that it can be re-evaluated formally.
”this issue relating to city assisted single family affordable home ownership has been plagued with horrendous abuse, excessive municipal legal and administrative costs, lack of oversight and unfettered favoritism.”
… is, if anything, an understatement. ”
Good points, I have to wonder if this program creates new employee positions, such as a director? If so, at what cost?
Right now there is no program. So we all have to wonder about how it will work.
From article: “But it’s pretty clear that we need more than just one project. And probably more than just two projects.”
This claim, which you have repeated many times on here, is factually incorrect. The state cannot force housing outside of the city, nor do any of its laws address doing so.
It is interesting that fire-prone places like Malibu and Santa Monica have RNHA targets, as well. Which means that the state is attempting to force housing in high risk zones. Although Pacific Palisades and Altadena are part of the city of Los Angeles itself, rebuilding in those high risk zones is likely going to be essentially forced by the state, as well.
So, the state is apparently in the business of forcing death and destruction, via its RHNA targets. (And not just in Southern California.)
Ron
You’ve made an excellent point that Davis is a good place to build more housing since we are in a lower risk zone. We are a haven from death and destruction.
Growth control limits are against a law passed in 2005. Davis doesn’t have a good defense against a state mandate on this matter.
“The state cannot force housing outside of the city, nor do any of its laws address doing so.”
Probably not directly under current laws. But the way this can work now is that the city risks crippling fines, lawsuits and funding opportunities if it doesn’t comply with RHNA, and peripheral landowners know that. So they can annex their land to the city — the city can’t prevent that except under rare circumstances — knowing that they’ll get development approval because the city needs the housing. So the net effect is that the state *can* force peripheral housing development on cities even if the citizens don’t want it.
Jim: I understand that the state can only apply RHNA targets within city limits, and that there is technically “no way” that a city is prevented from meeting those targets.
In other words, if a city doesn’t present an acceptable plan to the state, the state would then engage in ensuring that sites WITHIN the city do meet their targets.
Of course, if those sites don’t “pencil out”, then the housing will simply never be built. This is the most likely outcome.
There’s also some question as to how the state is going to view sites from previous rounds, which were never built. But from what I recall, they will “count” toward future rounds, as well.
There is no other way for this to work, in the vast number of cities- especially near the coast – which aren’t expanding their boundaries.
As far as the scenario you present, this seems like a separate manipulation. But even if that’s a possibility (e.g., during a period in which the city has not yet submitted an approved plan, but prior to the time that the state steps in and forces a rezoning of sites within a city), I would think that a developer would presumably have to show how “their” plan would meet a city’s RHNA targets.
Also, I don’t see a mechanism that a developer can use (in regard to an appeal to the state) to annex land to a city, in regard to the laws surrounding RHNA. There is no law I’m aware of which states that “if a city refuses to address RHNA targets, then the state will step in and force annexation of land outside of a city”. It ultimately seems about that simple.
And if it’s not that simple, then urban limit lines, agricultural zoning, agricultural easements, and the state’s own Williamson Act, for example, would be in the crosshairs of the state. (Which would fly directly in the face of what they claim to want – infill.)
One has to look at the original justification for the state’s recently-enacted laws (infill, in places like the Bay Area where jobs are supposedly plentiful and well-paying). Their entire premise is based on that.
So if they start encouraging sprawl on farmland (more than they already do by failing to reign it in throughout the state), this would certainly lay bare a different motivation than what they claim to be doing.
The state itself hasn’t been growing, and some business interests (who happen to support these politicians) aren’t too happy about that. In fact, the birth rate for the entire nation is well-below replacement levels, and it seems likely that Trump is going to curb (or even reverse) illegal immigration.
“Also, I don’t see a mechanism that a developer can use (in regard to an appeal to the state) to annex land to a city, in regard to the laws surrounding RHNA.”
A point of confusion for some — including me, once upon a time — is the notion that cities get to decide whether or not land is annexed to them. LAFCo has ultimate control, but as long as the annexation meets the LAFCo guidelines for orderly development, it’s the peripheral owners who make the decision.
The owners initiate the process, LAFCo oversees the process, and the only time the citizens of the city get to have a say is when the size of the population in the proposed annexation area is more than 50% of the population of the city.
So if a peripheral owner sees the adjacent city in a RHNA jam and wants to develop, he can get his property annexed, after which the City Council, facing RHNA fines for inaction, pretty much has to approve the development on that annexed land in some form or another.
I see what you mean to some degree. I just started looking into this, but it appears to be unconnected to the state’s recent laws, and predates them. Here’s how AI summarizes the referenced document, which is similar to what you said:
“No, in California, cities do not have sole authority to decide whether or not to annex land; the decision ultimately rests with the Local Agency Formation Commission (LAFCO) which must approve any annexation proposal made by a city, meaning the city can initiate the annexation process but cannot finalize it without LAFCO approval.”
https://www.sbcounty.gov/uploads/lafco/items/201205/item_11_supplemental.pdf
It also appears that LAFCO is responsible for establishing “spheres of influence” for a city, where LAFCO can exercise some control over annexation.
https://www.coachella.org/departments/development-services/lafco
Although Davis’ “sphere of influence” includes the Covell Village/Village Farms site, it does not appear to include the Shriner’s or DISC sites.
https://www.yololafco.org/files/f799a6e63/City+of+Davis-SOI+Map+Jul2016.pdf
As such, I might conclude (so far) that LAFCO might theoretically force annexation of the Covell Village/Village Farms site, but not Shriner’s or DISC sites. But in looking at how this is all written, it appears to be from the perspective that LAFCO is attempting to “control” sprawl and leapfrog development, and that it’s the cities which resist that control.
Here’s another document which addresses the Williamson Act and annexations:
https://www.conservation.ca.gov/dlrp/wa/Documents/LAFCOs_Annexations_WA_Presentation4.11.24.pdf
I’ll look into this further, over time. But at first glance, it appears to be a pretty complicated issue. And I would think that under the scenario you’re describing, the property owner would have a substantial burden to prove that his proposal addresses the RHNA targets, and that this is the “only” consideration he would have to meet for LAFCO to approve annexation. For example, NONE of the current proposals fully address expected RHNA targets. (It appears that there are other considerations as well, including general plans, how the land is currently used, etc.).
And it would be interesting to see how all of this interacts with urban limit lines throughout the state.
There’s also the issue of the pass-through agreement with the county, etc. Not sure how that would work, if LAFCO forced annexation of Covell Village, for example.
But in thinking about this further, it seems to me that BOTH the developer AND the city would lose control over exactly what the state might “require” on annexed land in terms of zoning, etc. (That seems to be the main difference regarding the newer state laws.)
This is also probably why it’s fortunate that voters in the state recently rejected a proposal to lower the percentage of approval needed in regard to funding for Affordable housing projects. Under the existing amount of funding available, there is no way to fund an enormous amount of low-income developments on the outskirts of a town. (As if that’s a good idea in the first place.)
For sure, cities throughout the state (which cannot annex adjacent land) are going to fail in regard to RHNA targets. Unless San Francisco, for example, can annex and simultaneously eliminate Daly City and South San Francisco. Maybe a single mega-city all the way down to San Jose? But even then, they’ll fail because those places already won’t be able to meet their own RHNA targets.
In all the years I’ve been reading about the issues with Measure J, I’m surprised this is the first I’ve heard of this.
Me too, Alan. It seems that Measure J doesn’t really matter, and never did – if a developer can get LAFCO to approve annexation. (As long as the property is within the sphere of influence – which the city also does not fully control).
It seems that the only thing that’s been “lost” as a result of the state’s recent laws is the city’s and developer’s ability to control zoning on a site that’s annexed to the city. So perhaps that’s the developer’s motivation to seek a Measure J vote – they’d prefer to stick with the zoning/development plan that they put forth via Measure J, rather than having the state involved. (Of course, that may not work if the newly-annexed site doesn’t fully address the state’s RHNA targets.)
“Not sure how that would work, if LAFCO forced annexation of Covell Village, for example.”
This is the crux of the matter: LAFCo doesn’t “force” annexation (except under some very limited circumstances), rather it accommodates a landowner’s desire to join an incorporated city. Annexation is basically a right under state law. It’s the peripheral property owner that drives the process, with LAFCo merely insuring that orderly development occurs. The city doesn’t have a lot of say in the process.
However, a City Council under RHNA pressure is very likely to endorse an annexation request, even knowing that a majority of the citizens don’t want to expand the city, because it has a duty to protect city finances that would be threatened by the state if the RHNA targets aren’t met. So even token official opposition to annexation isn’t likely to occur. And the voters have no direct say except in the 50%+1 condition noted above.
That’s my non-lawyerly take on the situation, anyway.
Jim: Sounds correct, except for the part about the developer (and city) losing control over exactly what the annexed land is zoned for (e.g., 400 acres of a “builder’s remedy”, perhaps – due to the state’s recent onslaught of laws).
And if that’s not the case, I’m not sure what’s to be gained (from a developer’s perspective) from going through a Measure J vote (v.s. asking LAFCO to simply approve annexation). The same situation that existed prior to the recent onslaught of state laws.
For sure, very few cities are going to meet the state’s “RHNA requirements” – other than on paper.
And again, I’m not sure this would apply to anything other than the Covell Village site, unless/until the Shriner’s and DISC sites are incorporated into the city’s “sphere of influence”.
So if I was a developer of those others sites, I’d be working on expanding the sphere of influence.
Truth be told, it seems to me that those who would prefer 400 acres of Affordable housing would prefer the LAFCO annexation process, over a Measure J vote. Sounds like a reason to vote “no”, from that perspective.
Measure J changes everything, but I do believe that it’s susceptible to legal challenge. That’s what led me to investigate annexation in the first place.
It seems to me that (regardless of whether voters, or a council) deny an annexation or rezone, it’s challengeable to LAFCO. And always has been, as long as the site is within a city’s sphere of influence.
But that the only difference now is that once land is annexed, it’s susceptible to the new laws essentially requiring “upzoning”. 400 acres of builder’s remedy, for example. Not a particularly desirable selling point, to someone plopping down more than a million on a single-family dwelling in regard to what might be approved next-door to them.
To clarify, it seems to me that a given site is susceptible to upzoning (builder’s remedy) REGARDLESS of whether or not it’s approved by Measure J. The only difference is that one process goes through voters, while one process goes through LAFCO and bypasses voters. But the end result is the same (no control over what the state then imposes on the site – as long it is within the sphere of influence and LAFCO approves the annexation).
In short, I’m not even seeing a need to challenge Measure J, regarding this outcome. In that type of situation, Measure J is only “advisory” with no force of law. As such, there’s nothing to overturn.
I think people are sometimes unaware of what they’re actually voting on with Measure J. It’s the right to vote on a zoning change. Except that they get to specifically vote up or down on the Village Farms site.
It seems unlikely that the property owners would seek to annex their land into the city limits unless they were planning to develop. But that part isn’t up to the voters.
If the voters use a zoning approval process to block housing development that would help Davis meet the state’s RHNA numbers, I’d guess that Measure J would be subject to challenge. Zoning to block housing is a big part of the problem in their view, I’d guess.
Don said: If the voters use a zoning approval process to block housing development that would help Davis meet the state’s RHNA numbers, I’d guess that Measure J would be subject to challenge. Zoning to block housing is a big part of the problem in their view, I’d guess.”
Seems to me that if voters APPROVE a housing development that DOESN’T address the state’s RHNA numbers, that approval would be a problem in the state’s view.
Seems like it would be a lot more efficient if developers just bypassed Measure J entirely, and appealed to LAFCO. But again, they would not have control over zoning – no one but the state does. (Only referring to sites within the sphere of influence, however.) And ultimately, the state (LAFCO) can control spheres of influence, as well (though they haven’t expanded it to include Shriner’s and DISC so far).
Bottom line is that the state controls both annexation AND subsequent zoning – regardless of Measure J approvals or rejections. And regardless of city council approvals or rejections, as well.
So as a follow-up to my last comment, it seems that cities ultimately have no control over zoning within the city, outside of the city, or how large the city might be forced to become.
In that light, Measure J (or any type of local planning effort whatsoever) seems like a big waste of time and money. Perhaps cities should just go ahead and do whatever the state tells them to do (or just let the state take over all planning and costs for infrastructure, etc.). What’s the point of even having a city, if it’s entirely subservient to the state? Why even have a council, planning commission, much of the staff, etc.? What would happen if they all just quit – who would the state decide to sue, then? Can they find someone to sue when a city already has turned over all control to the state? Reminds me of John Lennon’s song – “Imagine” (there’s no cities . . .).
Just let the developers deal directly with the state (as they already can do, regardless). Why the big charade, regarding Measure J or any other local plan? The state has the power and apparent desire to direct everything, including the consequences of their decisions. Maybe it’s time to stop fighting them, and let them do what they constantly threaten to do. The “Rob Bonta/Gavin Newsom City Council and Planning Commission” for the entire state.
Then again, there are periodic victories – such as the challenge regarding SB9 (so far). But maybe that’s not the right approach – just let them “win” and see what happens.
Cities and counties exist as local administrative units of the state. The state can abolish cities. (It has consider abolishing Vernon and Bellflower, two very corrupt cities near LA.) It has always had ultimate authority. But it is both administratively efficient and gives democratic local control to delegate authority to these jurisdictions within reason. The current problem is that localities have gone beyond reason in their selfishness to control who can live in their towns. It’s interesting that its possible that Measure J/R/D may have forced that issue in Davis. We need a land use lawyer to tell us what the law really says rather than us speculating without sound backgrounds on this matter.
Richard, this is a place for discussion – not legal counsel. For that matter, attorneys can only speculate regarding legal challenges, as well.
But your comment regarding “selfishness” goes to the heart of the difference regarding how you view this issue, vs. the way I do. I look forward to a stable population, stopping endless sprawl, etc. It’s the opposite of selfishness, to me. I don’t make money from anything I advocate for, or against. Nor will I experience any other benefit or drawback.
But the status quo (endless growth) cannot continue. Fortunately, young people these days aren’t having kids at anywhere near replacement levels (nationwide), and it seems likely that the new administration is going to reverse illegal immigration.
Selfishness is displayed by the business interests which want endless growth – the interests which are supporting YIMBYs.
Also, I’d like to address this comment: “But it is both administratively efficient and gives democratic local control to delegate authority to these jurisdictions within reason.”
Seems to me that as the state finds itself in conflict with cities (regarding its unattainable and corrupt goals), the state itself is going to have to assume responsibility for what they’re attempting to force in regard to local planning, infrastructure, etc.
On a related note, I believe that the state still hasn’t been able to reinstate SB-9, after it lost a legal decision regarding that.
https://newsroom.courts.ca.gov/news/court-overturns-lot-splitting-law-sb-9-one-early-adopter-asks-why#:~:text=Superior%20Court%20Judge%20Curtis%20Kin,in%20cities%20across%20the%20state.