October 3rd, 2014 Non-Profit Housing Association of Northern California Conference

1. Preserving Affordable Housing Near TransitA Project of the Housing the Workforce Working Group as Part of the Bay Area Regional Prosperity Plan October 3rd, 2014 Non-Profit Housing Association of Northern California Conference James Pappas, Housing Policy and Preservation Associate The California Housing Partnership

2. Project Purpose Land use and Transportation planning in California must now be integrated in Sustainable Community Strategies that demonstrate reductions in GHG emissions from auto use. The Bay Area, like other regions of the state, is emphasizing residential and job growth in Priority Development Areas (PDAs) centered around transit to reduce GHG emissions. The PDAs contain a significant portion of the existing housing affordable to lower income households so preserving this housing stock and preventing displacement are essential.

3. Priority Development Areas • Centered around present and future transit • Focus on established urban and suburban centers • Support infill development • Eligible for additional planning and infrastructure funds to facilitate growth Oakland San Francisco Fremont San Jose

4. Preserving Affordable Housing Near Transit Project Scope and Schedule • Regional Analysis (Months 1 - 3) • Identify where there are concentrations of vulnerable affordable housing stock in the Bay Area in relation to: existing and future transit system, places most likely to see growth—the PDAs, and vulnerable communities (Communities of Concern). • Local analysis and policy recommendations (Months 4 - 19) • Work with local jurisdictions to create policy mechanisms to preserve affordable housing in vulnerable locations. (San Jose, Fremont, Oakland) • Preservation Toolkit (Months 19 - 21) • Scale local findings and recommendations to regional scale, designed as a guide for jurisdictions with varying capacity and preservation needs.

5. Regional Analysis

6. Restricted Affordable Housing Risk Factors • HUD Funded and Financed Properties: • Expiration date of HUD Rental Assistance Contract • Maturity of HUD subsidized mortgage, or prepayment • LIHTC properties: • Risk based on remaining years of regulatory use agreements • Ownership Type: • For-profit owners • Small non-profits

7. Assessing the Bay Area’s Restricted Affordable Housing • 100,479 total affordable units in the region in nearly 1250 properties • 74,841 units with LIHTC • 31,017 units with HUD Rental Assistance • 9,347 at-risk units in 128 properties the vast majority belonging to small nonprofits or for-profit companies Source: HUD, TCAC, USDA

8. Existing Transit (Bus and Rail) • ~64,000 affordable housing units near transit • 64% of all affordable units in the region • 10% are at-risk (~6,500) • 69% of all at-risk units

9. Major New Transit Investments • ~16,000 affordable housing units • 16% of all affordable units in the region • 9% are at-risk (~1,500) • 16% of at-risk units

10. Market Pressures

11. Local Preservation Analysis: 3 Cities • Project began with focus on 2 cities set to receive major transit investments, San Jose and Fremont, to look at preservation need. Both will have new rail stations as part of the BART to Silicon Valley project. • In addition, through the regional analysis, Oakland, was selected as a third focus for preservation analysis.

12. Methodology for Identifying Preservation Priorities at the Local Level Case Study : San Jose

13. Risk Assessment of San Jose’s Affordable Units • 169 total properties with 18,690 Units, ~15,000 LIHTC and 3,600 HUD • 11 at-risk properties are older, HUD funded properties with rental assistance • Of 6 small nonprofits with “at-risk” properties, outreach revealed that nearly all are stable and plan to preserve long term affordability • All 5 at-risk for-profit owned properties are owned and/or managed by the same company

14. hhh Restricted Affordable Properties in Relation to Transit hhh

15. San Jose Rent Control • Rent Control (max. 8% Annual increase if built before 9/8/79) • Rental Rights and Referrals Program (Housing Dept.) • Code Enforcement

17. Identifying Priority Preservation Neighborhoods • Spatial Analysis: • Restricted Affordable Housing • Naturally Occurring Affordable Housing • Transit and Transportation Investments and Planning Efforts • Demographics and Neighborhood Change

18. Housing Affordable to Households Earning 50% of AMI or Less

19. PDAs in San Jose

20. Areas with Major Transit Investments or Planning Focus

21. Areas with 50% or more Renter Households

22. Gentrification Areas with Neighborhood Change 1990-2000

23. Areas Susceptible to Gentrification

24. Area of Overlap: Priority Preservation Area

25. Building a Preservation Toolkit

26. San Jose Existing and Proposed Affordable Housing Supportive Policies • Rent control • Rental Rights and Referrals Program • Code Enforcement • Ongoing monitoring of Restricted Affordable Properties and owner outreach • Inclusionary Housing Policy currently being litigated before California Supreme Court • Housing Impact fee currently under study

27. San Jose Affordable Housing Supportive Policies: Possible Additional Tools • Increased rent control monitoring • 1-for-1 replacement of rent controlled and restricted affordable units in event of redevelopment • Grants for tenant organizing and education • Landlord education program • Increased code enforcement • Local Preservation Ordinance • Dedicated Preservation Funding • Condo Conversion limits especially in priority pres. areas • Targeted Acquisition Strategy by Location & Building Type • Subsidy in exchange for new or extended affordability restrictions • Land Value Recapture

28. Regional Preservation Toolkit could include…. • Methodology of how to identify key areas for preservation focus- could help prioritize preservation efforts and resources • Examples of current local tools and how cities are working to preserve subsidized and market rate housing stock. • Recommendations derived from local work as models for other jurisdictions. • Database of at-risk subsidized properties near existing transit, future transit, in PDAs.

29. Thank you! For more information contact us: James Pappas, Housing Policy and Preservation Associate California Housing Partnership Corporation (CHPC) jpappas@chpc.net (415) 433-6804 x 320 Elizabeth Wampler, Associate Initiative Officer Great Communities Collaborative of the San Francisco Foundation ewampler@sff.org (415) 733-8573