Monday, February 10, 2014

Affordable Housing?

From the NYT:

Backlash by the Bay: Tech Riches Alter a City

. . . .

“There has to be some kind of public support to make sure you don’t just have a city of the very wealthy, but people to make the city run,” said Kevin Starr, professor of history and policy, planning and development at the University of Southern California.

“You can’t have a city of just rich people,” he said. “A city needs restaurant workers, a city needs schoolteachers, a city needs taxi drivers.”

[Mayor Edwin] Lee says he has a strong commitment to affordable housing — he pointed to the Housing Trust Fund, which will provide $1.5 billion in affordable housing over the next 30 years — and to preserving the character of San Francisco’s neighborhoods.

Wholesale evictions, he said, are “not good for the city.”

He conceded, “We have to figure some things out.”

From the Housing Trust Fund:

The Housing Trust Fund begins in year one with a general fund revenue transfer of $20 million and increases to $50 million over time. The Housing Trust Fund will capture revenue from former Redevelopment Agency Tax Increment funds (an example of what is being referred to as “boomerang” funds in post-redevelopment California), a small portion of the Hotel Tax which has been appropriated yearly for affordable housing, plus an additional $13 million in new General Fund revenue from an increase in business license fees. The consensus business tax reform measure, Proposition E, which also passed on the November ballot, will generate $28.5 million in the first year–$13 million of which will go to fund affordable and workforce housing. It is estimated that $1.5 billion will be invested in affordable housing production and housing programs over the next thirty years.

The first affordable housing project to be considered for funding from the Housing Trust Fund is the long-stalled 55 Laguna Senior Housing project. The joint venture of Mercy Housing California and Openhouse will request $6.1 million and will provide 110 apartments for low income seniors. The project has been on hold for eight years due to the downturn in the economy and the lack of local resources.

Let's say I was an employer in a gentrified, upscale city like New York, San Francisco, or Naples, Florida employing lots of service-industry workers whom I didn't want to pay a lot. How could I hold wages down?

Well, obviously, if I could leverage public money to subsidize their wages, that would help. But if I could also make sure that the housing available for them would only be attractive to young, single employees whom I could pay less and who wouldn't be much of a burden on the company health plan, and without dependents for whom the workers would demand schools that would drive tax increases. That would be good. So I'd offer my employees low wages but a free dorm room or studio apartment that older, married workers wouldn't be interested in. Or I'd make sure that the housing included, not just working class people, but enough lumpenproles to frighten away all but the young invincibles. I couldn't be accused of discrimination because, hey, I'll hire any worker who wants the compensation package. But I would have accomplished much the same thing.

Now, if that is San Francisco's plan, they're off to a slow start, seeing as how their first investment in "affordable housing" isn't for workers at all, but for retirees. And at least in this article, Mayor Lee sounds like a politician marking time, trying to stay in everyone's good graces until those losers who didn't get in on the IPO move out of my voting jurisdiction. But I am curious to know what the track record of "affordable housing" programs in upscale cities is at reducing the commutes of its advertized beneficiaries. Anyone?


Anonymous said...

At this point I mostly think they just want to stop people from throwing molotov cocktails at Google Buses.

I tend to be skeptical of most affordable housing projects that rely on subsidies rather than mass-construction. This at least involves construction rather than just rent control or eviction prevention, so it's a start. But it's San Francisco and they're pretty boxed in by default.

Anonymous said...

it might be worth a mention that the reason there is no affordable housing in San Francisco is because of leftist policies to freeze poor people out. Zoning. height restrictions of buildings. impossible to get permits for new construction. Policies that permit current residents to stop nearby construction if it harms their view. etc.

Anonymous said...

That's a reason, but not the sole or even primary reason.

Dr. Φ said...

I'm reluctant to characterize policies that keep poor people and their bastards away as "leftist". Seniors don't have this problem: they're well behaved, they seldom have custody of "teens", and their Medicare dollars create good jobs in healthcare.

The problem is that there are a heck of a lot more than 110 low-income retired couples who would love to live in San Francisco, so it will be interesting to look at the actual selection metric and how it can gamed.