Will social housing in Silicon Valley find funding to break ground?

A local assemblyman’s goal of establishing social housing in California is one signature away from fruition, but lingering questions remain about how these projects will be funded.

Assembly Bill 309 author Assemblymember Alex Lee said social housing—a method where governments own, manage and maintain homes designed as affordable housing—will help alleviate California’s housing crunch. But supporters and critics alike question how AB 309 will succeed without deep government investment.

“This will cost money to do and we need to identify those sources, we need to identify more affordable sources across the board,” Ray Bramson, chief operating officer of Destination: Home and a San José Spotlight columnist, said.

While social housing’s mixed-income approach is a pivot from the state’s status quo, Bramson told San José Spotlight it’s similar to public housing projects already being developed locally. He emphasized that the state should find local partners to help build, finance and operate these developments.

If Gov. Gavin Newsom signs the bill, it will create a Social Housing Program under the Department of General Services. The program will establish three pilot sites. The sites would be publicly owned, and residents would have eviction protections and rent control, as well as a right to make decisions pertaining to property management and operations.

Sandy Perry, president of the Affordable Housing Network of Santa Clara County, said the social housing concept is called “decommodification,” which means approaching housing as a basic human need. Perry told San José Spotlight most housing models operate as an investment vehicle.

To Perry, who is also vice president of the South Bay Community Land Trust, the best outcome for this bill would be to demonstrate that social housing can be a successful housing model. He considers this a revolutionary transformation.

“The key to this is we need to change the housing debate. The whole debate over housing is wrong because the housing system is basically broken,” Perry told San José Spotlight. “It can never work the way it’s currently set up because it will never produce affordable rents.”

The program established by AB 309 would prioritize revenue neutral projects—all operation and development expenditures paid off through rent, mortgages or other subsidies. This does not answer lingering questions about paying for building development, however, Bramson said, which is key to getting projects off the ground.

“Without a steady, significant stream of funding, it will be just as hard as ever to build these units,” Bramson said.

Both Lee’s bill and Senate Bill 555, spearheaded by state Sen. Aisha Wahab and calling for a study on the issue—could change the course of housing if approved by the governor.

Last week, Lee traveled to Singapore and Hong Kong to learn about social housing models. Lee, whose district includes part of San Jose, said he hopes the social housing model makes affordable housing more accessible. He introduced a bill on social housing in 2021, but lacked support at the time.

“Social housing is a commitment that housing is a human right and should be universally available so that no one struggles to have shelter,” Lee told San José Spotlight.

Contact B. Sakura Cannestra at [email protected] or @SakuCannestra on X, formerly known as Twitter.