Op-ed: A new vision for the Affordable Housing Trust Fund

On Tuesday, the City Council will discuss Mayor Bates’s omnibus housing plan. The plan has 13 points and covers everything from condo conversions to incentivizing Section 8 vouchers and by-right development rights. Yet, his proposal is a sweeping portrait of supply side economics and does not address displacement. It is premised on the idea that increasing the supply of market rate (expensive) apartments will ease the burden on everyone else, because, the argument goes, wealthy new comers will no longer be competing with everyone else for housing. Further, there is a presumption that people who move here will take mass transit to work, thus lessening our city’s carbon footprint.

Maybe this plan will work, maybe it won’t. However, the working people, persons with disabilities and senior citizens in my neighborhood won’t be around to find out, because they are rapidly being displaced. When our people are uproooted, they become economically isolated and must travel great distances to their jobs and care centers. This has the effect of swapping one carbon footprint for another.

Berkeley, like all Bay Area cities, is required by law to implement anti-displacement strategies. Our City had the rare foresight to create an Affordable Housing Trust Fund. Each new development in Berkeley must either provide affordable units on-site, or pay a certain sum (the in-lieu fee) into the Fund for future affordable housing projects. Right now, there is not enough money in the Fund, and the Mayor is proposing to raise the fee. This is a good step, but we must go further.

Berkeley is already very dense and has limited development sites that could potentially feed into the Fund. Also, since the market is cyclical — with booms and busts — one interest rate hike could put the kybosh on new developments for years. Yet, in that time, we know demand will continue to grow, because Cal is slated to add thousands of more students and San Franciscans continue to migrate across the Bay.

What’s needed is a consistent source of revenue for the Fund. If we were to dedicate a portion of the property transfer tax for the Fund, we could use it to back mortgages by non-profit agencies to acquire buildings with tenants at risk of displacement. This method will extend the reach of each dollar in the Fund many times over, and it will be faster and cheaper than only building new affordable housing units.

My proposal is a win-win scenario that encourages the creation of housing, while, at the same time, prevents displacement. In fact, San Francisco recently used a similar mechanism to help a local non-profit acquire two apartment buildings to protect tenants from the vagaries of the market.

This is just one of many potential solutions to the affordability crisis. Let’s use the Mayor’s plan as a starting point for a larger discussion around our shared future.