Encinitas planners: More work needed on low-income housing requirement

Much more research needs to be done before any steps are taken on a proposal to bump up the city's low-income housing construction requirement, the Encinitas planning commissioners declared during a special workshop Tuesday, Oct. 9.

"I feel like I don't have anywhere near enough information to make the kind of decisions we need to make tonight," Commissioner Jody Hubbard said.

An initial report on the likely impacts, which the City Council received late last month, provides a bit of information, but nowhere near enough, Hubbard and other commissioners said. They asked a representative for the city-hired consulting company, Keyser Marston Associates, to expand the scope of work.

"Just out of the gate, I would like to see a wider scope and maybe some modifications to a few of the ways that some of the presentation was calculated," Commissioner Al Apuzzo said. "I would ... like to see land values revisited, I would like to see a broader view of the different residential zones. We haven't included all of them. I think it's important."

Expanding the scope of the Keyser Marston Associates study now will require City Council authorization because it's going to cost the city more money, city principal planner Diane Langager said, adding that the issue might go before the council later this month. The initial research work cost the city $115,000.

Increasing the percentage of low-income housing that developers are required to include in their projects has been promoted as a way to help win passage of Measure U -- a city-sponsored, Nov. 6 ballot measure. Measure U proposes upzoning 15 privately owned properties, allowing their owners to exceed city height limits and construct 25 to 30 housing units an acre.

Supporters argue that the measure, which aims to bring the city into compliance with state housing planning laws, could greatly increase the city's supply of low-income housing. Opponents have argued that there's no guarantee that the proposed zoning changes on the 15 properties will result in more housing for low-income families, saying they believe it will result in more homes, but those homes will be costly ones.

In response, the city has begun looking into changing its low-income percentage set-aside. Encinitas currently requires developers of larger projects to either set aside 10 percent of their new homes for very-low income people or 15 percent for low-income people.

The qualifying income rates are calculated using the area's median income statistic, which in San Diego County currently is $81,800. The low-income, cut-off rate for a family of four is $77,850 and for very low it's $43,800.

The consultants looked into whether increasing that set-aside percentage would make development projects financially unviable. They concluded that the percent could be shifted upward by 5 percent citywide and 10 percent for the 15 properties, and development projects would still pencil out.

These findings have been disputed by area developers and the Building Industry Association of San Diego. Several developer representatives and Michael McSweeney, the BIA's senior public policy advisor, reiterated their concerns Tuesday night, Oct. 9.

McSweeney said the city just established its current percentages last summer and said Encinitas should study the full spectrum, including the financial prospects for projects before that recent change. If the city goes above 15 percent, it will likely "curtail" development, he said. McSweeney and several developers also said the city is unfairly putting all of the costs of building low-income housing on developers.

"Let's call a spade a spade; the way you're funding your affordable housing is you're taxing new home development," he said. "Those costs are passed on to people that buy the house, so how much can be absorbed without basically killing the goose that lays the golden egg?"

Development representatives weren't the only ones raising concerns Tuesday, Oct. 9. Measure U opponent Peter Stern told the commissioners that he also had issues with the consultant's figures and the exemptions the city offers when it comes to low-income housing construction.

"This is a phony exercise," he said.

Commissioners themselves said their attitudes toward the various ways of funding low-income housing were shifting. Hubbard and Commissioner Kevin Doyle said they were initially opposed to the idea of in-lieu fees -- payments developers can make instead of building low-income housing as part of their projects -- but were coming to believe that it might be a good option in some cases, noting that the city's historic Boathouse apartments had received funding from that source.

-- Barbara Henry is a reporter for The San Diego Union-Tribune