Mayor Sam Liccardo isn’t rattled by Gov. Gavin Newsom’s threat to withhold money from cities that fail to build enough housing — despite San Jose falling short of its housing production goals.
Liccardo said he was “all in” to support the governor’s ambitious housing development goals.
“We’ve been begging for these kinds of carrots and sticks,” Liccardo said. “And we are working on a regional level to see if we can encourage more cities to step up and build the housing.”
He said that he’s been pushing for a fee on new commercial development as a potential source of funding for affordable housing.
Newsom proposed withholding state transportation funding from cities that are not meeting housing goals. The plan was unveiled at the governor’s state budget presentation Jan. 10, which also included more than $2 billion in new funding for housing and homelessness initiatives.
California has required cities and counties to plan for enough new housing so that residents can live affordably. However, many local governments fail to approve new development, furthering the state’s housing shortage.
San Jose committed to building 35,080 housing units between 2015-2023, or about 4,385 new units per year, at various affordability levels, according to goals set by the Association of Bay Area Governments. As of the 2015-2017 update, permits had only been issued for 21 percent of San Jose’s committed housing units.
“There is no greater issue than affordability in the state and housing,” Newsom said at a roundtable conversation Jan. 15 where he heard from Bay Area residents who are facing extremely challenging circumstances due to the housing crisis.
“What can we do about it? There is no magic solution. We can’t solve this issue overnight,” Newsom said. “In fact we are 49th out of 50 per capita in housing units in the United States, which means substantively we have fallen behind over decades because we have simply not built enough housing.”
Not everyone agrees with the governor’s plan to withhold state transportation dollars, including Sen. Jim Beall (D-San Jose). Beall authored Senate Bill 1, 2017 legislation that increased the state’s gasoline taxes to pay for road repairs and transit improvements.
Beall said that while he appreciates Newsom’s innovative ideas, he has concerns about the effectiveness and safety of withholding transportation funds.
“Making the community safe, repairing the roads is important, it is probably not a good idea to link whether or not they are doing affordable housing with those kinds of funds,” Beall said.
Along with budgeting funds to address the housing shortfall and homelessness, the governor said he wants to incentivize additional resources for mayors and cities that are committed to plans and reaching housing milestones.
“If they don’t achieve those goals I want to see those dollars particularly in the transit side of our budget ledger be redirected to those that have performed,” Newsom said Tuesday. He said still budgets are created in silos.
Liccardo did not seem concerned about San Jose being penalized. The mayor pledged $10 million to help fund housing for workers making between 60 to 80 percent of the area’s median income, and hinted at more money following from Silicon Valley tech companies.
He said it wasn’t enough to just hope and pray that cities will meet housing goals.
San Jose has adopted a goal of building 25,000 units — 10,000 of them affordable — in the next five years and last month dedicated $100 million to fund affordable housing.
Housing advocates like Andrea Urton, CEO of nonprofit HomeFirst, praised the governor’s plan.
“Right now there isn’t any accountability,” Urton said. “So even though cities want to create affordable housing because they are not held accountable it goes to the wayside.”
Beall said the state legislature has been looking for ways to address the housing crisis, including minimizing the requirements of housing developments near transit to expedite the planning and constructing process.
“The question is, how do you inspire these local governments to build affordable housing or get developers to build affordable housing,” Beall said. “After all, the local governments are not the ones that are building the housing — it’s the developers.”
Contact Aliyah Mohammed at [email protected] or follow @Aliyah_JM on Twitter.