Jim Hutchins, Livermore
California requires cities to provide housing for residents “regardless of income.” Most cities comply by requiring the inclusion of affordable housing in new developments. Livermore, however, decided to let developers buy out of the requirement by paying “in-lieu” fees. The result is what you would expect – developers happily hand over the money so they don’t have to include affordable units, and the city builds a sizable fund the City Council can use for the affordable housing projects it wants. As of July 1, 2021, the fund had $14.2 million, with an estimated $1 million or more a year coming in from developers.
The city code allows the funds to be used to “assist in providing affordable housing”, including land acquisition, mortgages, subsidies, financing, and “any other assistance that will serve to increase” affordable housing. There is a downside to Livermore’s approach. As a report by the Urban Institute said, this practice “could lead to construction activity that reinforces patterns of segregation” by creating neighborhoods populated by people of lower socioeconomic status. This was a concern voiced by Commissioner John Stein at the Planning Commission meeting on April 20. It was this voiced concern, and his characterization of the segregation with the use of the word ghetto that caused a subsequent uproar, with the Mayor and City Council threatening to remove him from the Commission. But after this infamous meeting, the Planning Commission quietly addressed the matter at the very next meeting. On May 4, the Commission changed the rules for new apartment developments by “amending the Livermore Development Code to reactivate on-site affordable housing requirements for rental projects.” It is curious then why a fund this important doesn’t have a formal name. City documents call it the Housing In-Lieu Fund, Low-Income Housing Fund, In-Lieu Housing Fund, Affordable Housing Fund, Affordable Housing Trust Fund, Housing Trust Fund, Housing Fund 611, and probably the most formal name, Fund 611 (the accounting line item in the city’s budget is item 611, hence the name Fund 611).
One fund, but many names.