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Measure G has San Mateo affordable-housing mandate in limbo

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Unless voters approve Measure G next week, San Mateo may no longer be able to require developers to build affordable housing.

Some 1,200 people are on the city’s affordable-housing wait list, and some 1,000 applicants recently applied for 67 affordable units in a new development, according to city data. But the city’s requirement that more affordable housing be built could be undone by a 2009 a lawsuit known as the Palmer case.

San Mateo voters have long expressed support for affordable housing, most recently in 2004 with Measure P, which required that developers of rental projects of 11 units or more either allocate 15 percent of their units for low-income residents or 10 percent for very-low income residents.

Although that has resulted in the construction of hundreds of below-market-rate units, more are clearly needed.

But in the Palmer case, the California Court of Appeal decided cities could no longer force property owners to provide low-rent housing. Other cities have coped with that ruling by allowing developers who skip out on
affordable-housing requirements to pay a fee that cities then use to subsidize affordable-housing projects.

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But that won’t work in San Mateo. Under Measure P, the city is explicitly prohibited from accepting such fees.

To avoid getting sued by a developer, the City Council passed an emergency moratorium in September that banned new rental housing developments. But it can’t delay development forever without failing to heed the voters’ will to build more affordable housing.

Thus, officials are proposing Measure G, which Community Development Director Lisa Grote said would enable San Mateo to slip past the conflict of state and city laws and continue its affordable-housing policy.

The solution is delicate. Grote said officials realized that the Palmer decision would not prohibit them from charging a fee to developers who do not provide the required 15 percent of affordable units. Although Measure G would give developers a choice of whether or not to build affordable units, the idea behind it is to charge so much that most developers will just opt to build them.

“The intent is to make the option to put the units on site more attractive than paying the fee, because that’s what our below-market program has done,” Grote said.

If the measure does not pass, Grote said the city will likely extend its moratorium on rental developments and be forced to find an alternative.

Arguments have been filed against the measure by John Roeder, president of the Silicon Valley Taxpayers Association.

If the city truly wanted to tackle the affordable housing gap, Roeder wrote, they should remove limitations on building heights, erase permitting fees and expedite the permitting process for affordable-housing projects.

Yet even if all that were done, and a voter decision to limit building heights were rolled back, there would still be no guarantee that developments would include affordable housing, Grote said.

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