Council Unanimous in Support of Chiles Road Project, Affordable Housing Stream

In the end, neither the changes to the Affordable Housing ordinance, that enabled the council to approve the alternative funding stream, nor the project at 3820 Chiles Road proved to be very controversial.  In fact, the council largely, in a rare moment, stuck to their time schedule on Tuesday, with a handful of public commenters speaking – mostly in support of the project.

By a series of 5-0 votes, the council approved the middle income / workforce housing project.  The one small piece that hinted at controversy was the conversion of commercially zoned land to residential.

As Assistant City Manager Ashley Feeney explained, “We don’t take those decisions lightly.”

He explained, “The building (here) is functionally obsolete.  They had done a very thorough effort here to attempt to get this building rented and leased.”  He argued, “It would be very unlikely to see that rehabbed in any way that the market would support.”

With demolition costs, he said, “It’s much more likely that one of our vacant sites would be developed long before this site would be considered economically viable by an end user.”

In the end, he said, they have a proposal that meets a desired housing need for the city.  “Traditional multifamily,” Mr. Feeney explained.  “We haven’t see a proposal like that for a long time.”

Councilmember Will Arnold had pointed comments, pushing back on those who complained about the change in land use designation.

“My anticipation is that as we move forward with other projects that come in front of us for commercial and R&D use,” he said, “folks are going to say, we don’t need that future project as evidenced by the fact that we are (converting) commercial uses to residential uses.

“Not all commercial uses are equal,” he said.  “It’s kind of like saying you’re hungry and someone saying, how can you be hungry, there’s a half-eaten hot dog in the parking lot.

“I don’t get the reasoning there and frankly I think it’s disingenuous,” he said of those who would oppose a larger MRIC (Mace Ranch Innovation Center) because the city converted this small property from general commercial to residential.  “I am calling shenanigans on that.”

Chuck Cunningham, one of the project applicants, explained that Lawrence Shepard had gone to great lengths to find a use for the current building, but they found it to be “functionally obsolete.”

He noted, “The zoning of the property is commercial mixed-use…  highway commercial.”  He noted that is fast-food and auto repair: “Those are not things that we think make sense as it gets further into the residential community.

“It’s not designated tech or R&D,” he said.  “But the property does have an important role in the city’s economic development plans.  We suffer from adequate housing for our Davis workforce.”

Mr. Cunningham stated, “While it’s a housing project, it is a component for the economic development goals for the city.”  He said, “It meets an unmet need in the city.”

At the same time, “financing the project remains a challenge.”  The Plescia report says that there are no available dollars for affordable housing.  He stated, “He (Shepard) knew that wasn’t going to be the right answer.”

The plan they came up with is “much more than the current in lieu fee.”

Mr. Cunningham pointed out that over a 30-year time horizon, this would generate around $6 million for affordable housing and close to $14 million over the expected 50-year life cycle of the property.

Earlier in the evening, the council by a 5-0 vote approved the affordable housing plan.  The proposal, as previously noted, would be an on-going annual payment of 1.65 percent of the total gross rental income with a minimum annual payment of $100,000 to the housing trust fund.

Councilmember Lucas Frerichs noted, “The loss of redevelopment has meant a loss of $2 million per year funding for the creation of affordable housing.  This option allows us to add another tool to the toolkit.”

Will Arnold said, “One of the things that I’m most proud of is the amount of rental housing – both market rate and affordable – that this council has approved.”

He noted “the creativity with which we addressed our significant affordable housing needs.

“This would be the second, major, alternative to what was the only way we had ever done affordable housing in this town,” he said.  “The first one was the first time that we brought full time students into the fold.”

He said, “That was also a project applicant getting creative.”

On the main project – while the council was unanimous in their support, there was a concern about the loss of commercial.

“I think the need for housing is real and immediate in Davis,” Lucas Frerichs said.  “I think this project is great because it targets workforce and professionals and family rental housing.”

Mayor pro tem Gloria Partida said, “I am concerned that we are pulling the opportunity to put some commercial in that space there.”  But she said, “I really think that we need housing.  The amount of housing that’s going to go in here is going to barely make a dent in the amount of housing that we need.”

She did add that the housing and affordability “is more important than what we’re losing in that spot.”

Dan Carson briefly evaluated the project and said, “To me it meets all my criteria, it’s the type of project that we’re looking for.”

Brett Lee noted, “I have concerns about changing commercially zoned to residential.”  However, like his colleagues, he stated, “This project fulfills a specific need that we haven’t addressed lately.”

Mayor Lee, who has been critical of the proliferation of four- and five-bedroom student-oriented apartment proposals in recent developments, took the time to show how the vast majority of the units were one and two bedrooms.

“What is absent from this project (is) the abundance of four- and five-bedroom units,” he said.  “There definitely is a need for this type of configuration.”

The project sailed through with only some minor objections from the public, and one email to council that triggered the response from Councilmember Will Arnold.

—David M. Greenwald reporting

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