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Affordable housing guarantee unfeasible, experts say

ENCINITAS — For months, residents opposed to Encinitas’ housing element efforts have questioned why the city can’t require developers to build only affordable housing in the high-density zones proposed in the city’s future housing plan.

Last week, residents received their answer at the housing element session hosted by council members Lisa Shaffer and Mark Muir: it’s financially unfeasible, developers and an official with the state Housing and Community Development agency said.

“It would reach the point where the land economics wouldn’t support it,” said Matt Grosz, the chief investment officer of Chelsea Investment Corp., a leading affordable housing builder in San Diego County. “I wish it did, it would be great. But you can’t do it because the economics wouldn’t work.”

The housing element is the city’s first comprehensive overhaul of its housing and residential zoning map in more than 20 years, and will map out where an anticipated 1,300 units of affordable housing will be placed within the city. Voters are expected to vote on the plan in November 2016.

Encinitas is the only community in San Diego without an updated housing element, a dubious distinction that city officials say hurts them when competing for certain regional grants.

About 70 residents attended the session held at the Encinitas library branch, which included presentations on the housing element by seven panelists, including Grosz:  a state Housing and Community Development official, a local developer, a representative of Habitat for Humanity and three residents who have been critical of the city’s proposal.

The session, organized by Shaffer and Muir, was aimed at giving clarity to a number of issues that residents have raised about the housing element proposal. The two-hour workshop also included a question-and-answer period, in which residents could ask questions to any of the panelists.

Glen Campora, an assistant deputy director for the state housing agency, received the bulk of the questions, which centered around the topic of whether the city can compel developers to guarantee any high-density housing built under the plan would go toward low-income residents and families.

The city’s housing element proposes a so-called floating zone, in which developers can opt to change their current land uses to accommodate housing to the tune of 30 units per acre.

But residents have objected to the plan because there is no guarantee a developer would actually build affordable housing, and could develop luxury condominiums, which would defeat the purpose of the housing element.

“We just don’t feel like we have the tools to control what gets built,” Leucadia resident Kathleen Lees said.

The city could place those requirements on the land, but the state Housing and Community Development, which has final approval of the city’s proposal, could reject it because the plan would likely backfire and no housing would be built, Campora said.

“The purpose of the housing element is to promote the creation of affordable housing; the state would be hard pressed to approve a plan that it knew would deter that,” Campora said.

Grosz added that unless the city were to provide the land for the developer at little or no cost, building housing exclusively for low-income tenants would not pencil out for the developer, so no one would build it.

In communities where they have been successful in building such housing, like in San Marcos and Carlsbad, the housing was built on surplus government property or the city bought the land and then leased it to the developer, Grosz said.

The Dec. 10 meeting also answered several other popular housing element questions. Campora told the audience that the state housing department would give the city credit for accessory units that had not yet been counted among the city’s housing stock, provided the city deems them habitable and up to code.

“Good,” Bob Bonde said from the audience when Campora said this. Bonde has spearheaded the effort to have city officials count so-called “granny flats” among the housing stock to potentially lower the number of units the city has to plan for in the housing element.

Whether the meeting did anything to sway skeptics of the plan remains to be seen, though some in the audience reaffirmed their doubts about the housing element.

“We need to call it what it is — a sham that doesn’t guarantee affordable housing,” said Susan Turney, one of the three residents on the panel. “As it stands, I personally can’t support it in November.”