SAN JOSE, Calif. – A broad coalition pressing the City Council for a fee on developers of “market-rate” housing to fund affordable housing for working families won even more than they were asking for on Nov. 18, as the City Council not only passed the fee but also committed itself to exploring other funding sources for the same purpose, including a county-wide tax and a fee on commercial developers.
San Jose, which advertises itself as “the capital of Silicon Valley,” has one of the highest housing costs in the nation, as well as – not coincidentally – one of the highest rates of homelessness. The high-tech industry, including such tech behemoths as Apple, Google, and Facebook, generates enormous wealth for the tech élite, but families with less than a six-figure income are out of luck in finding housing they can afford. According to official estimates, an income of $107,000 is required to afford the rent on an average apartment.
The city used to receive $40 million a year from the state Redevelopment Agency to build affordable housing, but those funds disappeared in 2012 when Governor Jerry Brown dissolved the Agency, creating a major crisis for the whole region. Not only are working families suffering, forced into homelessness or into doubling or tripling up in substandard housing, but also businesses are complaining that they cannot attract workers because of the high cost of housing.
In response, affordable housing advocates assembled a coalition to press for a housing impact fee, an approach that has worked successfully in other cities in the region and elsewhere. The logic of the fee is simple: Every individual or family that moves into market-rate housing requires services – police, sanitation, retail, and others – staffed by workers who can’t afford the city’s inflated housing costs. So it’s reasonable to ask the developers of market-rate housing to pay toward providing housing for these needed service workers. A study commissioned by the city showed that the developers could pay a fee of up to $28 per square foot without significantly cutting into profits or raising rents.
A leader in building the coalition to support this fee was the Sacred Heart Housing Action Committee (SHHAC), a group of activists operating out of Sacred Heart Community Services, an organization that began in 1964 as a social service agency and over the past five years has turned itself into a major center for community organizing in San Jose. SHHAC helped pull together a broad spectrum of allies around this issue, including Working Partnerships, a community organization allied with the South Bay Labor Council AFL-CIO, the Silicon Valley Leadership Group, a business organization wielding considerable clout in the region, the Affordable Housing Network, and charitable agencies such as United Way and Catholic Charities. Through intensive grassroots organizing, SHHAC was able to bring to the City Council over 3,000 letters demanding that the fee be passed at the highest possible level.
A rally organized by SHHAC in front of City Hall fired up around 200 activists before they went in to the council chambers to testify and show their support for the measure. Pat Farrow of SHHAC opened the event by pointing out the sort of activists and leaders that make up SHHAC: people like herself, a senior on fixed income; like Robert, a homeless man who has a voucher for low-income housing but finds that every apartment that will take it has a long waiting list; or like Jolene, who has been on 20 housing lists but has yet to find a place. She described the two-year struggle that SHHAC and its allies have conducted: “When the city lost redevelopment funds, SHHAC went into action.” To loud cheers, she declared, “We have waited two years for this day, and finally it’s here – we have been heard. People who work here should be able to live here!”
Shiloh Ballard, vice-president of Silicon Valley Leadership Group for Housing and Community Development, reported that her organization, which represents some 400 businesses in the area, asks its members every year what the biggest impediment is to doing business here, and every year they get the same response: Housing.
Hip-hop artist Andrew Bigelow roused the crowd with a song about the inequities of life in Silicon Valley: “There’s lots of gold, but not enough to go around – somebody’s robbing somebody!” “We live in one of the wealthiest places in the world,” he said, “yet we have people freezing on the streets.”
SHHAC activist Anthony King told of being homeless from 1998 to 2103: “I have lived in numerous tents along the Guadalupe River,” a favorite haunt of many homeless in the city. He told of finding help from a non-profit, but the going was still tough. He got a Section 8 voucher for low-income housing, but he went to many places only to find himself outbid by someone willing to pay above market rate, until finally, with the help of his case manager, he found an apartment. “But the point is not to dwell on my success,” he said, “but to think of the thousands who haven’t found housing. Today we have an opportunity to rectify this situation with an affordable housing impact fee!”
Rebecca Irelan, pastor of Willow Glen United Methodist Church in the center of San Jose, spoke of her morning spent helping someone find a rental van for their belongings so they could move out of the area because they couldn’t find affordable housing – a very usual occurrence in her work. “If we want God to have a home in this valley,” she declared, “we must make homes for God’s people. Not just for some people, not just for those who have high-paying jobs, but for all people.”
Pat then asked people to turn to their neighbor and ask whether they had ever struggled to find affordable housing in the city. Complying, this writer got a powerful lesson in the extent of the housing crisis. Valerie, who recently got a master’s degree in public administration from Harvard – not the sort of school whose graduates are expected to wind up homeless – said she had spent the last several months sleeping on her sister’s couch, along with twelve other people who couldn’t find a place to live within their means.
The activists then filed into the council chambers, filling over half the pubic seats, and gave testimony after testimony to the depth of the crisis: Long waiting lists for low- or even middle-income housing, no affordable housing for students or even graduates of San Jose State University, lifelong residents of the city forced to move away for lack of housing, people repeatedly forced into homelessness as landlords jacked up rent.
A few opponents of the measure from the real estate industry tried to put up a smokescreen, overstating the fee’s cost to developers, property owners, and renters of market-rate housing and forecasting an end to housing development if the measure passed – despite the fact that neighboring cities have instituted similar fees without any of these consequences.
The Council was not fooled and passed the measure seven to three. In an additional, and unexpected, victory, it added two provisions that the affordable housing coalition had not even asked for. One, proposed by progressive councilmember Don Rocha, committed the city to investigate other sources of housing funding, including a fee on commercial developers. In an ironic twist, the other came from councilmember Pierluigi Oliverio, a notorious fiscal conservative, who, in an effort to derail the impact fee, proposed that the city ask the county to consider a county-wide tax to support affordable housing, only to see his proposal added to the resolution instituting the fee.
So when they went across the street to 4th Street Pizza, the activists had plenty to celebrate.