This is a disaster for affordable housing in Palo Alto. By granting special benefits to developers targeting people earning over $100,000 a year (120% of Area Median Income), land will go up in price even more and be forever out of reach of non-profits that build housing for truly low-income people. Those non-profits already struggle to buy land but this makes it far worse.

So the rich developers and tech companies make themselves richer, while claiming they're helping the poor. Palo Alto's color isn't green. It's greed.

Thank you thank you thank you Palo Alto City Council for showing leadership on Affordable Housing!

Thank you Council, for taking a significant step to make it easier to build affordable housing. There's a long road ahead, but hopefully this will be a signal that our community welcomes affordable housing development!

@Developers win,
Agreed. Please consider a referendum to set this aside and an initiative to replace it with one that reduces the income level to those who truly are low income. We do not need a zone-busting company town subsidy using affordable housing as the excuse again, like at Maybell. Under this, there will be people in neighborhoods subsidizing housing for people making more than they do.

The height exception should also be limited adjacent to single-family homes. That, or we should require the next tall dense undeparked development to be within two blocks of Liz Kniss.

A better name for this would be developer exploitation zone or developer giveaway zone.

The council should be commended for this and the PTC should be formally reprimanded for not weighing and providing a recommendation. It was clear dereliction of duty on their part.

Further, the idea being propagated that having policy that goes up to 120% of AMI favors wealthier individuals is false and does not take into account how affordable housing projects are financed. First, projects or portions of projects at 60% or below are eligible for all kinds of federal, state and local incentives, grants and tax credits. If anything they usually happen more regularly because the are eligible for these subsidies. Including 120% AMI attempts to remove at least one obstacle to providing additional units that can target higher incomes. By law the units have to be similar, and there is just more monetary incentive for developers to create units below 60% than above. This policy will hopefully address this.

Secondly and more importantly, can we please dispel the myth that 120% of AMI in Palo Alto should not be classified as a desired affordable product? Even if a household, two people making just over 60K a year, is at that threshold they only bring in roughly $7000 a month post tax with a reasonable affordability of $2100 / month. That is between 2-3000 less than the average rental in Palo Alto currently. We should reject the notion that this is not a strata of our community that we would seek to accommodate and house. If anything we actually out to be exploring incentives for higher income thresholds, which face equal challenges in living in our city.

Thank you to the council for recognizing this need for housing affordability at every level.

I'm not sure the AMI numbers quoted in the article are accurate; I have seen and heard a range.

Regardless, it's not that the 120% AMI is not an income situation that deserves AH; it is that those at HALF that need AH more. By a lot. Why not prioritize need and focus first on those who need the break the most? I include below 61% AMI and those with special needs in that category.

Overall, it is good that CC moved forward with this and I applaud Tanaka for adding the 100% rental provision. That said, it is worth remembering that the housing hole we are in would not be as deep as it is if this same CC (and others before it) had taken a more conservative and sustainable approach to commercial development. Self-inflicted wounds are the worst, no?

Hooray for hearts as well as brainy minds in Palo Alto! Why did this need to pass? No need to iterate diversity, environment, economics...Just, Council rightly moved, simply Because it is the right thing to do.

Change is the one thing we can count on in our world. We need to face it, not deny it, run from it. This Might be good to model for our children and our country: How we learn from and move with, change and challenges, take a risk if needed.

Some Palo Altans raise the question: “What sort of city do we want to see here in 10 years?” - But that’s a red herring. The question is: What defines our city, our community TODAY? Who are we, now?

“The time is always right to do right,” wrote Rev. Brother Martin Luther King, Jr.
He preached this, and in our Palo Alto schools, we teach this, but Palo Alto needs to walk the walk…

Dear Mayor Kniss, Vice Mayor Filseth, and City Council Members,

Thank you very much for listening to the community last night, for recognizing that policy changes are necessary to preserve the most important values of our community, and for taking decisive action to begin to address the housing crisis in Palo Alto.

1. You listened to the community.

As many speakers made clear during the public hearing, people throughout Palo Alto have suffered for many years because too few homes have been built in Palo Alto that people of all income levels can afford.

2. You understood that actual change is necessary.

It has been nearly a decade since the Palo Alto City Council has approved a new affordable housing project. You acknowledged that diversity of many kinds — including income diversity — is an important value in our community, but you didn’t stop there. You did not rest after merely articulating that value. Instead, you went on to acknowledge that something needed to be done to protect and to advance that value. You recognized that current zoning laws have been overly restrictive and needed to be changed through concrete legislative initiatives.

3. You took action.

Last night, by a 7-2 vote, you demonstrated that you truly care about the needs of all members of our community. A strong majority of the City Council took the first steps to forge powerful new tools that will allow Palo Alto Housing and other groups to build the broad range of more reasonably priced homes that individuals and families throughout Palo Alto need.

On the 124th anniversary of Palo Alto’s incorporation, you celebrated some of the best parts of Palo Alto’s heritage. As one speaker observed last night, in decades past Palo Alto has been recognized as a leader in affordable housing. In the future, we can do even better. You demonstrated great leadership and courage by doing more than simply saying that you support affordable housing: you took decisive action to begin to actually address the housing crisis in Palo Alto.

Thank you very much for doing the right thing last night.

Respectfully submitted,

John Kelley

A needed first step. Though there is only one possible project in the pipeline and I say possible because it still needs to undergo community scrutiny, review and approval’s by PTC, ARB, and Council. It is for 100% affordable housing at 60% AMI with 25% of the units dedicated to special needs, folks that don’t typically drive.
Having raised the parking minimum, beyond what the state requires and which the nonprofit housing developer stated will be problematic to developing the project baffles me — so why insist on it Filseth & Dubois?? Your vote is a false narrative because including excessive parking and retail requirements will shut down any 100% affordable housing projects, despite this new ordinance.

BMR and affordable are interchangeable and in Santa Clara County, AMI for a family of 3 it’s $108k. You tell me where a couple (with a kid) earning $54k each on average, can afford to live? Going to 100% and even up to 120% AMI is necessary.

Thank you Mayor Kniss, Fine, Wolbach and those members of the PTC (Monk, Alcheck, Riggs) who pushed for this ordinance. The hundreds of families on the waitlists thank you too!

And a big shout out to Palo Alto Forward - for showing your true colors--that you are committed to and advocate for the most vulnerable and underserved who so desperately need housing. (And to dispel the anticipated hater trolls, no, I’m not on PAF. Just a big fan and grateful for their community service)

The city is finally coming back to what makes Palo Alto a good place to be: decisions based on humanitarian values. The avarice over real estate has driven the fantasy that it’s all about pimped out houses, but that’s not true. Values came first.

While most people supported true BMR housing, going beyond the 60% Area Median Income (AMI) and including 61% - 120% Area Median Income, that includes incomes well over $100K, even for single folks, means the city council gave a big upzone for market rate housing upzoning. Palo Alto Forward and developer community used the affordable housing crisis to upzone market rate housing, increase the height limit and reduce parking requirements.

This is a big step, and an important one. After the vote against the Maybell affordable housing project, we’ve been caricatured as California’s worst city on the housing crisis. But Palo Alto has historically supported affordable housing and this vote - at 7-2 - shows that a broad swathe of the community still does. It’s unfortunate that Kou and Holman could not find a way to support the overlay, but 7-2 is still a good start and a sign of what may hopefully be a community consensus in favor of addressing housing affordability.

Thank you especially to Mayor Kniss and Councilmembers Fine and Wolbach for your efforts to make affordable housing workable within Palo Alto again.

Congrats to the city council for moving forward with the AH zone. This is a great step towards a more welcoming community. I don't understand the hostility to people in the 60-120% AMI band. First of all, there has been a lot of misinformation floating around about what 120% AMI *means*. The definition in the ordinance is "moderate income" in reference to state law, which means $103,320 for a single person and $147,480 for a family of 4.

Does anyone honestly think you can afford market rate housing in Palo Alto for a family of 4 on that income (that of a teacher, or a firefighter)? If we want to live in a diverse welcoming community, our only option is to make it possible for these people to live here too.

Second, its called the "missing middle" for a reason. A 120% AMI project is below market rate and thus wouldn't be built without a creative funding source. The notion that it will allow developers to "steal" from 60% AMI projects is absurd. The funding constraints on LIHTC alone are enough to ensure development of 0-60/80% AMI projects are given "priority". Most such projects target multiple income bands within this range and leverage other incentives (e.g. vouchers) to accommodate very low and low income families.

Finally, as Council Member Filseth acknowledged last night, we can refine our cities policies going forward as we see how things work. If the parade of horribles outlined in this thread comes to reality, there will be opportunities to correct them later. With this ordinance, we have a fighting chance to build affordable housing in Palo Alto.

There is nothing more unaffordable than "affordable housing". Here's why: new development must pay the current price of land purchases and construction costs including well meaning but price increasing government regulations. Wh gets "affordable housing"? At this time very few as what money available is best concentrated on those truly in need: homeless shelters and special arrangements for those people immediately in need of shelter. Look at the numbers: The federal government falls deeper into debt. California's state government is basically insolvent (pensions and the cost of illegal aliens, etc.) Housing is way at the bottom of the list as we cannot afford more social spending. All this material is covered in economics classes or with those who care to educate themselves. George Drysdale as a good citizen will dedicate and pay for a thirty food statue of Alred E. Newman (what me worry?) for the front of the Buena Vista trailer park. We cannot afford to think with our emotions, It cost way too much.
George Drysdale land economist

Let's translate this into plain English:

Subsidized housing for well compensated tech workers.
An unprecedented injection of capital to real estate developers.

This is an enormous step for desperately needed affordable housing in Palo Alto. A big thank you to Palo Alto Forward and the League of Women’s Voters for their support of this measure, which was clearly critical for forging this community consensus on making affordable housing easier to build. Thank you especially to Elaine Uang, Sandra Slater, and Eric Rosenblum for your years of tireless advocacy on behalf of Palo Alto’s most vulnerable. Without your work standing up for those in need, especially in the last few months, this would not have happened, and affordable housing in Palo Alto would face a difficult and uncertain future.

Thank you to every resident who signed the petition and every resident who spoke in support. Your work will benefit many Palo Altans, now and for decades to come.

This is a great step by City Council. Thanks you for taking positive action to help the diversity of our housing.

Thank you to everyone who came out last night. This is a huge win for those who build and live in affordable housing. Thank you for the strong words John Kelley and also to those who supported this effort from the very beginning. I am a Palo Alto resident and I will vote make sure to support those leaders who didn't "struggle" to support this overlay.

@ mauricio



you said " Let's translate this into plain English:

"Subsidized housing for well compensated tech workers.
An unprecedented injection of capital to real estate developers."

Except it will not, can not be subsidized at those income levels by any government fund.

So either it is a meaningless bit of legislation or .....or it is an opportunity for someone to make money$$$$ off of denser ,higher under parked residential development....sound familiar? think VTA plot being up-zoned with similar density etc...all to benefit the developers financially. At least the VTA lot location is surrounded by other fifty foot buildings; not necessarily the case across the citywide so called AH housing overlay.
certainly not the case for the proposed project on ECR @ Wilton

Unfortunate that Palo Alto Housing had to side with such dirty politics to get their project advanced when they could have advocated otherwise.

Unfortunate that between the Council majority, the planning commission minority and senior staff there are so few left standing that are examples of integrity, honesty or even intellect.

This is not a win for true affordable Housing but an example of the worst cynicism and dirty politics. Most of us in Palo Alto agree to despise what is happening in Washington but to few of us are willing to take a critcal look if what is going on here in palo alto and how it mimics the bully dishonest tactics in the white house....heck, who said it? " all politics is local "

The allegation spread by many last night that allowing BMR projects up to 120% of AMi takes away from projects for lower income residents is a lie.

Anyone who took the time as Cory did last night to invite Candice Gonzalez of PAH t clarify would now know that projects up to 80% of AMI now qualify for tax credits and projects for up to 120% DO NOT COMPETE WITH PROJECTS FOR LOWER INCOME RESIDENTS AS THEY HAVE DIFFERENT FUNDING STREAMS.

The allegation repeated over and over that the ordinance is a private market developer giveaway is similarly a lie.

Anyone as Cory and Adrian did last night to clarify this with staff and Candice would now know that all these projects are BMR, have strict rent and othe limits and require subsidy money that is available only to non profit developers.

Thanks to the council majority and to Cory and Adrian for seeing through this misinformation campaign and taking the time to clarify the record.

Council member Tanaka at the end made a compelling plea that in the rest of the work plan we make sure to encourage projects that have a mix of income ranges including some market rate housing to cover some of the costs that make low-income housing hard to finance.

A well done first step, time to walk the talk on the other housing plan issues.

What is going on now in Palo Alto re development is just as corrupt as what is going on in Trump's Washington D.C, and I'm happier than ever before that I got out.

@stephen levy: Just to be completely clear, you're saying that there is never ANY point in the funding process at which money for <60% AMI projects and money for 80%-120% AMI projects is allocated from the same pool? That is, there is never ANY revenue-raising or budgeting process at which the two compete for funding?

@ Allen

Never is a strong word

What Candice said as the expert is that tax credits are the financing tool fir projects below 80% of AMI and are not eligible funding for projects above that level. Candice in response to a direct question said there is no competition. I am reporting what she said and staff confirmed. The question could have been asked and answered at any tine by the PTC or posters making these bogus allegations.

Projects above that 80% level are rare in Palo Alto but do require separate funding.

Since non profit developers do not make a profit there is no incentive as alleged for them to select higher rent/higher cost projects.

With regard to city money the council can determine where to use the fees collected for low and moderate income housing.

Steve -

The tone of your comment suggests that the only cost of these projects is the funding stream.

But the biggest cost is the impact on our overextended infrastructure.

And, from a taxpayer’s perspective, aren’t taxes fungible? That is, does it matter which of my taxes subsidize developers for this directly or indirectly?

Taxpayers still pay, and when they do it can have an impact on other things tax money goes toward.

Or am I missing an economic principal?

@stephen levy: Thanks! Do we have a sense for what fraction of the funding for BMR projects derives from the tax credits? (I assume we'd have to look at the enabling legislation for the credits to understand whether there are tradeoffs baked into them.) And from your comments it sounds like the distribution of City funds to projects of both types comes from a shared development fee pool. Is that correct?

@Allen

My understanding is that most if not all projects use tax credits as a major funding source.

The city collects a variety of impact fees on market rate developments that fund the city contributions to low-income projects as we did for Buena Vista.

Unless the city makes an additional contribution for some public purpose no taxpayer dollars are involved in this funding. Last night some council members did discuss having the city pay for retail or parking costs that would otherwise make a project not feasible but that was not part of the ordinance.

@Allen

I asked Danny Ross this question at the event he did on Affordable Housing Financing. The comment is at about 43:19 in:

Web Link

His answer was that in theory you could do it without the state tax credits (LIHTC), but in practice its not really possible to make a project pencil out without using it as a funding source.

The parking issue still concerns me.

In a recent article in the Weekly about the upgrades being done at Buena Vista mobile home park, Web Link one resident is quoted as being happy that the upgrades are being done but she is lamenting the fact that they are losing one of their two parking spaces and now one family member has to park on the street. I tend to think that this would be a fairly typical situation in lower incomes as at least one in the family works until late or night (or starts very early in the morning) and I suspect the one bus route does not take them to their place of work.

I can't begin to say how ridiculous it is to think that low income families will not have at least one car per couple for them to live their lives. They are not likely to be able to pay to Uber everywhere and Caltrain and route 22 cannot possibly meet all their transportation needs for work as well as for things like shopping and other regular trips that everyday life warrants. To suggest that 0.5 spots per units will meet the need of this type of housing is unfathomable to me. At any apartment and indeed condo site around town, the amount of street parking is very apparent. Those that live near East Palo Alto were so concerned about the amount of street parking for those living the other side of the creek that they got an RPP for their streets.

We are not likely to be anywhere near a situation where lower income people are about to give up cars to use transit and bikes.

This is going to be a big ongoing problem, I believe.

HURRAH for the newly adopted AH Combining District Ordinance! It's a great first step for housing in Palo Alto.

Yes!! Palo Alto - moving forward!
Together ensuring our city becomes the diverse, inclusive, dynamic community we all want. Thank you Mayor Kniss, Cory, Adrian, Eric, Tom and Greg! That is why we voted for you.

Thank you to the city council for recognizing this need for housing affordability at every level.

Thank you to the city council for recognizing this need for housing affordability at every level.

I like how all the defenders of the 120% of AMI say don't worry about the fairness. Crumbs will go to a few deserving individuals, the rest to people who want to shorten their commutes to Palo Alto.

Palantir, and their kind (PAF), must be very happy.

Very glad to see that this is moving forward! We need to say yes to as many projects as we can. As a single person making this "middle income" (ie, too much for low-income housing, too little to ever compete against techies for a studio in Palo Alto), and as someone who does NOT work in tech and does NOT own a car, I'd love to see more of this "missing middle" housing close to jobs/transport.

@stephen levy, @Grant Dashner: Stephen asserted that "...allowing BMR projects up to 120% of AMi takes away from projects for lower income residents is a lie." I'm trying to understand whether that's true.

So far I've learned two things:

(1) Tax credits reserved for projects for lower-income residents are only one of the sources of funding for those projects. So far no one here has explained whether projects for higher-income residents compete for a pool from which those tax credits are drawn. We also haven't heard here whether projects for higher-income residents compete for the other sources of funding used by lower-income projects. These "other" sources are the primary funding in some (all?) projects (one example given in the video provided by Grant).

(2) From Steve's later comments, we know that projects for higher-income residents do compete with projects for lower-income residents for at least one pool of funding: the City's contributions derived from impact fees.

Based on what we've seen here so far, 80%-120% AMI projects do reduce the funding available for 60% AMI projects.

Congratulations and thank you to the city council for taking this action!

Welcome back from the shadows, Candice Gonzalez and Palo Alto Housing! It’s been five long years since a determined coalition used opposition to Palo Alto Housing Corporation’s Maybell Project as the horse to ride to policy ascendancy in city affairs. Now most agree that it’s time to actually get some affordable housing built, and your Wilton project will be the test case for that proposition. Good luck to you and all of us as we try to get this done right

Consider: a Palo Alto existence is a struggle for the missing middle. Given that, it must be unbearably difficult, if not impossible, for those who earn <60% AMI and those with special needs who have ongoing expenses that absorb income. I think we got things only sort of right last night. Philosophically a step in the right direction; practically, only time will tell.

And to be clear: I've no hostility towards the higher AMI earners and I sincerely doubt other supporters of the up to 60% AMI approach do either. Please give us the benefit of doubt and accept that our concern is for those having the hardest time. I have no hesitation stating that I think they should be helped first.

Allen

As I said in my post projects that serve above 80% do not qualify for tax credits.

And Candice reported that for PAH the projects do not compete.

As to city funds shouldn't they go where the council wishes? Why would you prohibit the council from discretion in the use of housing fees? If the city had not projects brought forth for 80% AMI or below and they had a project for 90% AMI, would you prohibit them by law from funding the only available project?

And all that rant about private developers scamming the system to make a profit is total BS as all projects are managed under rent limit and other rules and need subsidy money that private developers cannot get.

And the rant that families making 100-% of the AMI can afford market rate housing in Palo Alto and are therefore undeserving is also BS as Jessica and others showed last night.

Remember the ordinance applies only to projects where ALL the units are BMR.

"going beyond the 60% Area Median Income (AMI) and including 61% - 120% Area Median Income, that includes incomes well over $100K, even for single folks, means the city council gave a big upzone for market rate housing upzoning."

In other words, city-subsidized company housing for Palantir,

I learned a lot, or at least I think I did, and now have a better understanding of the ordinance...I think! Adrian Fine did a good job of introducing his motion with his slideshow presentation. Different views and opinions were offered by the many speakers, and Mayor Kniss graciously thanked them for coming and speaking out. There was a lot of confusion about the AMI levels before, because the public had never heard it explained before. That's a sign of poor communications and engagement with the citizenry. Not everyone accesses PAO or gets the Friday print edition. Not everyone who lives in PA can fit into the Council Chambers on Monday nights.

My request of CC members...have those local neighborhood meetings you talked about when on the campaign trail...well advertised and at good venues able to accommodate big audiences, and at good times. Knock on doors, leave flyers explaining issues, et al. Send out emails to your neighborhood constituents to get support for your proposed ideas. You ran for CC, and made it. I hope you didn't think it was just an honorary position, and going to be a soft job! It requires a lot of hard work and time, and I can see that many of you are taking it very seriously and putting in a lot time dealing with the issues confronting our city. Thanks for that!

But some parts of the ordinance are still confusing. How does the developer package a funding deal for both the 60% and below AMI, 60%-80% AMI, and then the range all the way up to 120% AMI? Yes, PAH, as a non-profit should be trusted, with a limited budget and relying on all limited available sources of funding, to take care of the 'very low income', 'low income', et al. Those income levels are defined. But what about the rental rates that will be charged? Is there some formula used to put caps on the rents of those ranges to match income levels? Could those be so high to consume 50%-60% of the take home pay of the occupants? The saga has just begun. The reality of having a structure built and occupants living in it, with the intent of the ordinance, is years away.

I especially liked Eric Filseth's comments. He said he had moved a little bit in his thinking on the AMI issue, as I have, and that there are enough safeguards for getting the Wilton Ave project through the final approval stage, and that changes could be made along the way. Neighborhood participation and cooperation is vital, along with the parking survey. That survey, if done right and above board, will probably reveal some not so good results for the supporters of the ordinance. Just check cars in BV. For the sake of argument, for now at least, just consider the Wilton Ave parking situation the same as BV's situation.

So the beat goes on, and now CC can forget about having to deal with that issue again for a year or two. Now back to other business...infrastructure, transit, grade separation, pension funds, bike boulevards, et al. CC members are definitely underpaid.

Another disastrous nail in the coffin of Palo Alto as a nice place to live. This is just another give away to allow developers to put up massive high rises that will cram in more people than our local ecosystem can support.

We already don't have room for all the cars on the road. We don't have enough park and playing field space. The Bay area has the most polluted air in the country. California has the most endangered species in the country. We will run out of water due to drought and our lives will be slowly impoverished by the burgeoning population before it happens.

Why are politicians so easy to buy off for developers? Why do reasonable people not see the whole picture? People can't seem to stop overpopulating their homes and those whom we elect to provide direction and zoning can't seem to understand how this works. We are dooming succeeding generations to a massively diminished quality of life in this area. And mostly because of greedy people who won't take their companies (and the invading workers) elsewhere.

@stephen levy: I'm not advocating anything at the moment, just trying to understand the possible consequences of the overlay. In response to your key points:

"...projects that serve above 80% do not qualify for tax credits.": Tax credits aren't the only source of funding for BMR housing projects, correct? The question was whether 80%+ projects reduce funding available for 60% projects, so if they compete for funds from other sources, the fact that they don't compete for one particular set of tax credits doesn't affect the answer.

"...Candice reported that for PAH the projects do not compete." Great! It appears that wasn't an answer to the general question, though; it only expressed PAH's current strategy.

"As to city funds shouldn't they go where the council wishes?" Not my call, but more money to 80%+ projects does mean less is available for 60% projects.

Great! It's only a small step in the right direction, but I'm grateful to everyone who worked so hard on making it happen.

The reaction from some of the commenters here really clarifies what they were working against:

> "This is a disaster... People can't seem to stop overpopulating their homes and those whom we elect to provide direction and zoning can't seem to understand how this works. We are dooming succeeding generations to a massively diminished quality of life in this area. And mostly because of greedy people who won't take their companies (and the invading workers) elsewhere."

I'll chime in that, as a member of that "succeeding generation", by which I mean someone under 50, I'm a lot more worried about whether my friends and my children can find homes in the area than I am about parking or "invading workers".

Some of us live here in part because of great local companies, count their workers as friends, and can somehow imagine living here even if some of the buildings were taller.

That summary from Mayor Kniss was exactly right:

> "The diversity in our community is so important," Kniss said. "It's important for our kids, it's important for you and it's important for those people who are here. Without production, you no longer get that diversity."

Which is more important to quality of life: easy parking and exclusively short buildings, or a community that includes people of many ages, backgrounds, and professions, doing great and interesting things?

We *have to choose*. It's one or the other, and I'd certainly pick the latter.

@Allen

The Valco project that danny is talking about in the video isn't a 100% affordable project; if it were being built in palo alto it wouldn't be eligible for the overlay. Thus its not an example of a way to fund a 100% affordable project--its a situation where you can fit some BMR units into a larger market rate project.

The reason I linked to it is for his observation that for 100% affordable projects, LITHC is really *the* key funding source. It is capped at 80% AMI (with the average under 60% IIUC). So that bulk funding source really is focused on the lower range. Other funding streams like federal vouchers often have even lower income caps. For the 80-120% AMI range, the primary BMR funding sources don't apply, which is why organizations like PAH don't build those kind of projects and we call it the "missing middle".

The city could choose to spend its impact fees however it likes, but thats a policy decision that wasn't at issue in this ordinance. Passing this overlay doesn't suddenly let those projects "swoop in" and "steal" the funding from sub 60/80 AMI projects since those projects primary funding streams are limited to the lower income ranges. Do we at least agree on that point?

Now, you said this:

> (1) Tax credits reserved for projects for lower-income residents are only one of the sources of funding for those
> projects. So far no one here has explained whether projects for higher-income residents compete for a pool from
> which those tax credits are drawn.

I think we've repeatedly said that they don't. The tax credits "pool" (the primary funding stream for PAH-style projects) doesn't extend past 80% AMI (previously didn't extend pass 60% AMI)

> We also haven't heard here whether projects for higher-income residents compete for the other sources of funding
> used by lower-income projects. These "other" sources are the primary funding in some (all?) projects (one example
> given in the video provided by Grant).

The Valco project isn't 100% affordable; thats a totally different game. As i understand it, the main other sources are federal grants (also limited) and the city/county impact fee funds (at the discretion of those bodies how to spend).

> (2) From Steve's later comments, we know that projects for higher-income residents do compete with projects for
> lower-income residents for at least one pool of funding: the City's contributions derived from impact fees.

Yes, in theory thats right. But I don't think it sustains the talking point people are using. First of all, the impact fees are typically not the "make or break" source of a 100% affordable project. Second, and more importantly, the city has more than enough of them to spread out over lots of projects--we've built *zero* projects in this city in the past couple years. If there is actually a conflict constraining our ability to spend those funds, then we can make a priority decision. The current policy guidlines are here (Web Link But this isn't the problem. The problem is that *very few people are bringing forward projects* because the process is so daunting.

If I'm reading the city budget correctly, we have $42 million sitting in the city fund right now, expected to grow to $44 million. The city budgeted almost zero outlays from this fund in 2017 (Web Link page 46)

The AH zone will hopefully create an environment where people will bring forward projects. If we end up in the lucky position of having to prioritize how to spend the cities affordable housing fund, rather than just having it sit there, we will be in really good shape :)

@Grant Dasher: Apologies; I've been trying to be brief, and haven't expressed a few points clearly enough.

"...if it [the Vallco project] were being built in palo alto it wouldn't be eligible for the overlay." I didn't assume it would be. I intended to use it as an example to show that there are multiple funding sources for BMR housing projects, and if you're going to make the case that higher-AMI projects have no negative impact on lower-AMI projects, you need to take all funding sources into account (just as Danny mentioned).

"LITHC is really *the* key funding source." Good; I'm glad someone is finally chiming in with the information I'd hoped for. Tax credits don't provide capital or operating expenses; that comes from investors and other sources (several of which you mentioned). The tax credits give investors additional incentive to participate. Can you break down how much investment for a PAH low-income BMR project comes from LIHTC investors, and how much from other sources? I also wonder how many of those investors also participate in other housing projects that don't qualify for LIHTC. That would give us neophytes a sense of how the investment market works. (I would guess that the same investors that participate in LIHTC-qualified projects also participate in projects for higher-income residents, but simply require a higher return to offset the lack of LIHTC. If so, there would be a direct market connection.)

"Passing this overlay doesn't suddenly let those projects "swoop in" and "steal" the funding from sub 60/80 AMI projects since those projects primary funding streams are limited to the lower income ranges. Do we at least agree on that point?" Not exactly. If funding isn't available because it's been used for higher-AMI projects that were encouraged by the overlay, then lower-AMI projects simply lose out.


">So far no one here has explained whether projects for higher-income residents compete for a pool from which those tax credits are drawn.

I think we've repeatedly said that they don't"

This is a case where I was too telegraphic. My concern was about how the tax credits are created and allocated and whether there is any interaction with any other relevant government subsidy or BMR housing program. Now that I have the magic acronym "LIHTC" I can see that this is an extremely complicated issue. For example: "The Internal Revenue Service (IRS) allocates federal tax credits to state housing credit agencies (HCA) based on each state’s population. In the case of 9 percent credits, project sponsors (who hold general partner interests in the final ownership entities of developments) of proposed low-income housing projects apply through a competitive process for allocations of tax credits from state HCAs. The state agencies award LIHTCs for qualified affordable housing projects based on point systems reflecting each state’s priorities for the desired type, location, and ownership of affordable housing."

I could be convinced that this process creates no conflict between low-AMI and high-AMI projects, but even in the few sentences above the potential for conflict seems non-zero. Anyway, the relevance of this depends a great deal on the mix of funding sources for BMR projects that I asked about above.

"The problem is that *very few people are bringing forward projects* because the process is so daunting." Are you sure that's the cause, and not simple economics? With commercial development so much more lucrative than even market-rate housing, and no limits in place, the incentives are aligned to grab land even at extremely high prices and build commercial space.

@Allen

No apology necessary; I'm trying to be brief too and online comment threads aren't exactly the greatest forum for these discussions :)

I'm not an expert in this area, so to some degree I'm just relaying what I've heard second hand from Candice, Danny, and the other folks in PAH at the various talks they've given.

I found this article (Web Link a pretty good description of the funding sources for PAH-style housing in California. It says that with the 9 percent credits you referenced, LIHTC covers 70% of the eligible development costs (defined in the article). I'm sure PAH would be happy to share some data on this with you too for their recent projects, I just don't happen to have the exact numbers (just the summaries that they've provided in their presentations).


In the interests of brevity, I'll just briefly touch on a few things you said:

> Not exactly. If funding isn't available because it's been used for higher-AMI projects that were encouraged by the overlay, then lower-AMI projects simply lose out.

This assumes that there is some limit on possible funding, right? I don't think thats a realistic assumption--these investments are very small as a fraction of the available capital pool at the banks that make these investments. I think we can assume that other factors are the constraints, not maximum available potential capital. Plus, they look really good in press releases (e.g. Web Link


> Can you break down how much investment for a PAH low-income BMR project comes from LIHTC investors, and how much from other sources? I also wonder how many of those investors also participate in other housing projects that don't qualify for LIHTC. That would give us neophytes a sense of how the investment market works.

I think it depends on which exact program, but for the 9% credits it appears to be 70% of the eligible costs. I suspect the investors invest in lots of projects, but I also suspect that these investments are a small enough fraction of the overall capital pool interested in investing that we can assume they are decided independently and there aren't significant tradeoffs where a market rate project would preclude a BMR investment. Indeed, in the video i cited earlier, Danny mentions that these tax credits are extremely effective incentives to the investors (unfortunately less so now with the GOP tax bill, but still significant).

> I could be convinced that this process creates no conflict between low-AMI and high-AMI projects, but even in the few sentences above the potential for conflict seems non-zero. Anyway, the relevance of this depends a great deal on the mix of funding sources for BMR projects that I asked about above.

Hope what I was able to provide helps a least a little. I will also reach out to PAH to see if they have more palo alto specific local data on this, because I too am interested in the exact numbers rather than just the broad outlines that they've presented previously.

> Are you sure that's the cause, and not simple economics? With commercial development so much more lucrative than even market-rate housing, and no limits in place, the incentives are aligned to grab land even at extremely high prices and build commercial space.

I said this based on two reasons:
1. Danny said in the video (sorry, don't have a time cite) that land acquisition often isn't the problem. They get donations or are otherwise able to swing it. The problem is much more the inability to create a financial structure that pays for the long term operational costs of the project, which is directly tied to the zoning requirements around density, etc.

2. In Mountain View, PAH alone has 4 sizable projects either recently opened or in the pipeline. There has been nothing in Palo Alto (hopefully we will do Wilton soon). Land is cheaper in MTV, but not *enough cheaper* to account for that big of a difference. The much clearer difference is a different attitude towards zoning for BMR projects.

With respect to commercial development: there is a lot of land in this city that isn't zoned for office and thus isn't on the table for that kind of development. I'm not saying land acquisition isn't a problem, but I don't believe it to be the first order problem here.

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80% AMI allows all these companies to densify for their short-term entry-level tech worker needs, and pay none of the actual costs. We are perilously close to becoming an office oark that exists for the sake of the Palantirs (why are they still allowed to violate zoning and take over downtown?) Allowing density makes the land more valuable to developers which displaces actually low and moderate income residents.

This came from the same people who refused to discuss what low-income and affordable should actually mean here. And who ran their campaigns hiding their contributions from developers.

Palo Alto has seen some major efforts for low-income residents go online since Maybell including 801 Alma, the development on El Camino, and BV saved. PAHC is not the only AH corporation, and their model is to overwhelm, pull the nimby card at every step, see and treat residents as the enemy, get so chummy with developers they make questionable decisions. We consider whether to focus working with other AH organizations that see the opportunities here and can be more trustworthy and collaborative with residents.

This November hopefully those who are opposed to developer giveaways by the CC will VOTE so that Wolbach does not serve another term. Until then, the PAF-sympathetic CC faction is unfortunately in the majority

@election matters

As an observer, would Eric Filseth fall into that category as pro-development majority? He is definitely not in line with what he professed to during his campaign. Now, he is just a Greg Scharff follower/pleaser and wow, what an inflated ego Eric Filseth has.

Affordable housing is noble, however up to 60%AMI, maybe even up to 80%. But, not 80-120%, there is no tax credits there which speaks loudly that the government or subsidizers do not consider it to be "affordable".

Anyways, your council member Fine ensured the Tanaka person that building high density market rate is next, forming an ordinance for that. All for the sake of providing diversity as Kniss, Fine and Wolbach purports.

That council member Kou saying that this ordinance looks like a mini SB827 was pretty accurate. Density bonus applied, building heights can go up to 105ft. That all El Camino Real. Anyways, your pro-development council will approve the over 50 ft to accommodate "affordable" housing.

Elections does matter...so, watch out for Allison Cormack, she is a Liz Kniss protege. Same for Susan Monk.

Also, watch out for the Democratic machine and the League of Women Voters. They are no longer what they were meant to be, now mostly hyperbole and very much about commerce, no more about the people.

Hey, you should consider a Mayor to be elected rather than voted in by council. Most cities are fair to have all council members takes their turns but you all in Palo Alto have a poor position because majority rules.

Good luck to all of you. LOL!!! I lol because the resident looking to preserve quality of life just sits back and are only concerned when it affects them. It will affect them sooner or later. Yeah, good luck to the few that tries to be active and looking beyond what is happening in and around their backyards.

BMR in general = band aid on a bigger problem.

That approach to housing will just continue to hollow out the middle class. Soon Palo Alto, like San Francisco, will be the rich folks (or old folks who have been in their homes for 30 years) and the service class that cleans their houses and nanny's their kids.

Meanwhile, the middle class continues to flee to places like Mountain House or Morgan Hill.

Of course, the dynamic is that anti-development folks will find any excuse to halt development and will claim that they only want 60% AMI BMRs. That's the unholy alliance that Aaron Peskin and his Telegraph Hill Dwellers crew in SF leverage all the time to block any kind of development to keep his precious views and property values.

We need more *market rate* housing, not stupid ideas like BMRs.

Liz Kniss said that Palo Alto needs diversity. This scheme will create the exact opposite. This is subsidized housing for well paid tech workers and huge handouts to developers who are getting all the breaks. It will accelerate the rate at which P.A. is becoming an office park and reduce diversity. Let's just rename it Palantir City and be done with the charade.

I doubt building market rate housing in Palo Alto will be helpful to those in the missing/dwindling middle.

About Monday night - something happened that I think deserves mention. Sue Monk asked something of the City Attorney and shortly after that she and the City Attorney left the proceedings briefly. Next thing you know, Monk is allowed to give advocacy remarks in support of the Council (majority) supported, eventually approved, minority position of the PTC. Before Monk started to speak, Council Member Kou objected to the peculiarity but the Mayor allowed it. No surprise there; Monk's remarks supported the Mayor's position on the issue.

But the event speaks to an erosion of process and undermining of citizen participation that took root under Mayor Scharff. Who can forget last January's audacious actions regarding the work done by the CAC? What's the point of having a PTC or other commission if majority decisions are dismissed and disrespected? Who among us will volunteer to waste time serving on a committee or commission if the effort can be erased by one member doing the sort of thing Monk did - and was allowed to do? Not agreeing is one thing, but overturning a majority vote is quite another.

Others on this thread have directly or indirectly stated concerns about some of the political alliances that exist in Palo Alto. The type of involvement we've seen from the Democratic Party, the League of Women Voters, PAF, developers, and even a company, Palantir, have been questioned. I think the questions are good because it seems to me we are slowly seeing our model of government morph into something that barely resembles representation.

It is easy to be critical of our tweeting President and speak with concern about what's happening in this republic. I think we need to ask some hard questions about what is happening right here in our own home town.

"I doubt building market rate housing in Palo Alto will be helpful to those in the missing/dwindling middle."

It is the *only* approach. BMRs just exacerbates the situation by removing even more potential housing that the middle class could have.

We're seeing the gentrification of Palo Alto into Atherton because of this.

BMRs = another "I'm from the government and I'm here to help" level of stupidity.

To Allen Akin who always asks thoughtful questions - I think the issue between below 80% AMI and above 80% AMI is not how affordable housing is funded but competition over purchasing land.

With all the incentives available in the affordable housing overlay a for-profit developer can make more per square foot then with office, renting to those at 120% AMI. So they will buy up all the land.

Those using tax credits to build housing for very low and extremely low income folks will not be able to compete, so no affordable housing will be built.

And yes, those at 120% AMI can rent market rate units - many people do. There is plenty to rent on the market. Many people,even at higher incomes spend more than 30% of their salary on housing. If you want to spend less there are units available now in Sunnyvale, Redwood City and elsewhere.

@Me Too

I understand your criticism of BMR and suspect we have a fundamental agreement about too much government. Since Monday I have been asking myself why, instead of building BMR housing, we don't effectively convert existing rentals into BMR housing by making housing assistance funds available to renters who qualify for BMR housing but cannot clear one of the impossibly long wait lists? Title would not need to change; people would simply get a helping hand paying rent. That would be one way to walk the walk. We'd retain some diversity and help those who need it most.

As for market rate housing; my point is only that the sticker price would likely be prohibitive to those of us in the middle.

We are witnessing now the morphing of the city government, local companies, one in particular, and a lobbying group it has been underwriting for several years into one.

I am reading right now "Red Notice", by Bill Browder, the true story of an America-born financier in the wild east of Russia. The similarity with what Palo Alto has become, sans the murder and torture, is frightening. In Russia it is the criminal morphing of the government, oligarchs and the judicial system, in Palo Alto it's the morphing of local politicians, city staff, tech companies and developer interests, in the guise of providing "affordable" housing.

In the wake of the referendum overturning the Maybell project, many opponents of the PAHC plan argued that they really did support affordable housing if done right. They argued that collaborative efforts could be launched to build; obtain by purchase; or sustain, by blocking redevelopment of low rent properties, needed affordable housing.

After five years, we're finally seeing some movement. A city council roughly balanced between residentialists and backers of some measure of increased density just approved a significant, though cautious, move toward making affordable housing development possible. Unanimous council support for PAH's Wilton Project makes me cautiously optimistic that this proof of concept effort will go forward and give us relevant local data to look at in weighing future proposals.

@Grant Dasher:

Thanks for the link to the funding description. Very helpful!

One thing that caught my eye is that the LIHTC 9% credit subsidizes at most 70% of the development cost, and *cost of land is not eligible for this subsidy*. I don't understand fully what this means, but it is consistent with Danny's comment about acquiring land by methods other than purchase. On the downside, it suggests that <60%/AMI projects do compete for land with 80%-120%/AMI projects using funding other than that provided by LIHTC credits, as @Competition described. It also suggests that there could be competition for other funding sources for 30% or more of the cost of the project, but more on that below.

The debt structure is daunting, and it'll take me some time to get a handle on it. Danny's comment about long-term operational costs seems particularly relevant here.

Related to that, you wrote "This assumes that there is some limit on possible funding, right? I don't think thats a realistic assumption..." If there's unlimited funding chasing BMR projects, then basic economics suggests the return on investment for such projects is too high, and BMR developers are leaving money on the table -- which would explain their difficulty meeting operational costs.

With regard to projects and land prices in Mountain View, a little bit cheaper might be enough to make a huge difference in the number of projects. Given a choice between projects with ROI of 10% (for instance), and projects with ROI of 9%, wouldn't it make sense to build as many 10% projects as possible before falling back to a 9% project?

Why do we need Affordable housing ?
Our average AGI is over $1.1M and we claim an average of $500k in Tax deductions. No reason such a wealthy community cannot pay full price for their housing. So tire of my tax money funding wealthy Palo ALtans.

"Palo Alto is home to one of the richest ZIP codes in the country, according to a new report by Bloomberg. The report ranks Palo Alto's 94301 ZIP code No. 4 when it comes to the wealthiest communities in the U.S. and No. 2 among ZIP codes in the West. The median price of a home in the 94301 ZIP code is $3.83 million, according to Bloomberg, which used real estate figures for 2017-2018 to compile the rankings. Residents of the Palo Alto ZIP code earn an average adjusted gross income of $1.17 million, according to a Bloomberg analysis of 2015 Internal Revenue Service data.

The Palo Alto ZIP code claims another spot on Bloomberg's rankings. According to the report: "the ZIP code that took the most advantage of tax deductions in 2015 was 94301 in Palo Alto, California, where the average deduction was $491,600."

Web Link

I suspect the online debates will fade away and probably disappear for many months. So, before that happens, I have questions I'd like to ask and I'll direct them primarily to Grant Dasher and Allen Akin, who seem to have done a lot of research on the issue and are very knowledgeable on it, based on their back and forth comments.

Let's assume the project is finally approved, with whatever modifications are made to the recently approved ordinance. Let's assume 47 units will be 1 bdrm 1 bath apartments, and the other 10 will be 2 bdrm 2 bath apartments.

Questions:

1. Will there be a sign up list for the prospective tenants or will they line up like people do outside an Apple Store, waiting for the doors to open?
2. Will they be screened to validate their income levels? How will that be done?
3. How will those units be distributed among the applicants? Number of units rented based on each AMI income level? Will the funding sources dictate that?
4. Will the rents be different for the same equivalent unit, 1 bdrm 1 bath, for example, depending on income levels...where they fit in the AMI ranges?, osne tenant living next door to a neighbor in a different income level? Will their rental rates be different? That's a question for PAH! Will rents consume more than 50% of a tenants take home pay? Is your goal for it to be no more than 30%? Now that's a noble, and hopefully achievable goal. Anything short of that says to me, you need to try harder!

I also invite anyone from PAH to answer my questions above, and of course Steve Levy, who often answers without an invitation. lol! C'mon Steve, lighten up. You spoke very well at Monday's meeting BTW. Your voice is heard by some, but mostly by PAF members!

Other questions to PAH. Are any of those folks on long waiting lists at your other facilities eligible for the Wilton Ave units? Can they be transferred? Will they get preference or first right of refusal? Those questions are important and CC should also be held accountable for answers to those questions.

Who knows how this will play out...but if it turns out to be nothing but a way of providing housing for tech workers, teachers, and any others who can be described as, and fit into the 'middle income' or even 'upper middle income' levels, then this will go down as a total failure. Our restaurant workers, barristers, grocery store clerks, gardeners, house cleaners, home care providers, and I shouldn't fail to mention the nail salon workers, need to be taken care of in any 'affordable' housing discussions. If they are left out and can't afford to become tenants in these new projects then we have failed them...we're saying "go live an hour or two away, but drive every day to come back to serve us".

I don't want to bore you, but I remember, and apparently Mayor Kniss also remembers, how things were back in the '70's. I go back even farther than that to the early 60's. Diversity abounded and workers at every income level could afford to live here. All that has changed and we are left with only those memories. Those days are gone forever.

An election is coming up in November. CC candidates will make their pitch. Some will try to say how much they've done for housing...ADU's, saving Buena Vista, and now the new ordinance. In my opinion, the first two were bad deals and decisions, so we're left with this new one to ponder. Most registered voters will still only look at lawn signs and campaign ads in newspapers. Sad, but true!

Candidates know that and that's what they focus on and spend their contributions...campaign funds...on. It works.

Kudos to the Council, who did the right thing by passing the overlay even though the PTC was completely unhelpful by failing to provide an opinion on the overlay itself.

I hope that this is a first step towards rebalancing housing in Palo Alto. I would really like to see one new residential bed for every new office desk, to catch up a little bit with our history of underbuilding residential relative to office. I struggle to understand why commenters here feel that residences stress City infrastructure but office space doesn't. If people commute from their homes they also commute to their desks.

I am excited to welcome new people to Palo Alto. As I live in a part of the City that is sparse and unwalkable, I understand the need for residential parking. We have a housing _crisis_ in Palo Alto -- though if you own a home here you may not feel that crisis yourself -- while we do not have a parking crisis. We have ways of discouraging residents from having unnecessary cars: we can offer permits for overnight parking in residential areas. Until then, I think it's wise to provide for fewer cars for people on limited budgets near transit. Those are exactly the conditions when we can expect to incentivize having fewer cars. Rich people won't respond to incentives that way, and people far from transit won't either. This is our chance.

Many years ago, Palo Alto had retail businesses that weren't restaurants or laundries. But they weren't sustainable, with increasing rents but not increasing numbers of residential customers. For all the people who oppose residential development because it would change the character of our city: have you noticed that it already changed? I don't like it. Adding more residential customers can bring them back or at least stabilize the situation.

Thanks again Council for taking a hard vote to keep Palo Alto a vibrant 21st Century city.

Gale Johnson has it right again. Below market housing in a place like Palo Alto is near impossible. Atherton, Los Altos Hills get it. Also, students of social science: diversity is not necessary good (in group out group) unless you're talking about a diversity of highly skilled workers. Don't get caught up in beautiful idealism, it's stupid and costs too much. Candidates for the next election stop your political correctness or the skeptics will be waiting in ambush. Ask those who actually invest in apartment houses what they think of set asides: the building unions, the money providers those in the business of providing housing. Those of you who deplore development I agree with you. I want to return to the time of the oak woodlands and make my living gathering shellfish.
George Drysdale land economist

Suggestion to Gale Johnson:

Make an appointment to meet with Candice Gonzalez to get answers to your questions. Lots of people have the same questions but never ask someone who might have the answers.

Then share what you find out here on Town Square.

Mauricio put it well:
We are witnessing now the morphing of the city government, local companies, one in particular, and a lobbying group it has been underwriting for several years into one.
********
I can be more specific. Palantir Executive (Rosenblum) is President of Palo Alto Forward.
PAF proudly lists their Thousand-dollar-plus donors:

Community Champion: $1000+
Anonymous
Bryan and Sarah Silverthorn
Elaine Uang
Eric Rosenblum and Titi Liu
Mehdi Alhassani
Nicole Lederer and Larry Orr
Sandra Slater
Stephen Levy
_____

-Steven Levy, development advocate, not just BMR, is Treasurer of PA Forward AND Treasurer of the local League of Women Voters.
-Sandra Slater is an owner of a construction company (Drew Maran Construction), her home is the corporate address of PA Forward.
City Manager Keene wants to award her a $100,000 annual contract.

There is much more. But this is a glimpse into what is going on.

"-Steven Levy, development advocate, not just BMR, is Treasurer of PA Forward AND Treasurer of the local League of Women Voters."

Another reason for skepticism concerning the local League of Women Voters.

Oh wait, there's more!
The Planning Commissioner who visibly convinced the city attorney (they talked privately for some time at the meeting) that she should be able to speak and Mayor Liz, violating procedures, allowed her to do so at the start of public comments.
Planning Commissioner Susan Monk was Mayor Liz Kniss' Campaign Manager. She was Manager when Kniss DID NOT REPORT several large donations from developers until after the election.
Monk has been silent but she must have known about it. We await an FPPC decision on this serious violation of election law.

We need LESS housing in Palo Alto not more housing. Traffic, lines, pollution are at all time highs.

Residents need to realize this isn't about housing the poor, its a WAR on suburbia.

Back in the 1960s leftist radicals imprinted on the idea that suburbia was the root of all evil. War, racism, sexism, patriarchy, petroleum, pollution, automobiles and people telling them to get real job... all had their evil roots in suburbia.

As the 1960's faded into the 1970s and the majority of boomers got a real job and faded into a conventional a suburban lifestyle, the diehard suburb-haters put into practice the slogan "think globally and act locally" and began infiltrating themselves into schools, community organizations, non-profit institutions and local government to begin what would be a 50 year long covert war of attrition on the evils of suburbia.

These warriors fought in obscurity and with little effect for 25+ years until sometime in the 1990s they found an unlikely ally. An ally with the wealth to fund AstroTurf political movements, to buy politicians, and even entire political Parties. An ally that hated suburbia just as much as they did... real-estate developers.

Real-estate developers hated suburbia not because it was evil. Developers are amoral at best. Developers hated suburbia because suburbia was getting in the way of their ruthless accumulation of wealth through the exploitation of community assets built by residential taxpayers.

Marx said "The last capitalist we hang shall be the one who sold us the rope". In this Machiavellian marriage of convenience who really wears the pants and when it inevitably falls apart, who will end up in the noose?

Why can't Palo Alto build more regular market priced homes?

Hi, Gale! Those are excellent questions, but I don't know enough to have the answers.

There is some useful information on the PAH website. For example, at http://pah.community/resources/affordable-101/overview/ the topic "Waitlists. How do I Get -- and Stay -- on One?" explains how the sign-up lists work. There's a list for each property. You can get an application online, then submit it to the property where you want to live.

Apparently the rules for income eligibility and rent are different for each property, so there's no simple answer to questions about those. The PAH folks should be able to give us some general guidelines.

How nice it is to live in Palo Alto Hills and advocate for massive housing construction far from that neighborhood. How about squeezing 50,000 new residents into tall apartment buildings in the Page Mill Road corridor between Arastradero and Skyline? I'm sure that DanielD from Palo Alto Hills who is so supportive of more housing would jump at the opprtunity to push hard for massive housing construction in his neighborhood, or perhaps he would be more like Liz Kniss who moved up to Palo Alto Hills from the slums of Palo Alto before getting so aggressively involved in pushing for housing construction among the neighborhoods of the unwashed masses living way below PAH?

@Can’t Afford a House,
Palo Alto has been expensive since it was Mayfield, probably because of proxomity to Stanford. I couldn’t afford a house here for the first 30 years of living in the BA and still can’t based on income, or even close. Getting into Bay Area real estate is like getting on a train that never stops. Wishing it will stop will never work, you have to just get on somehow and then shuffle until you can get a seat.

There are very nice manufactured homes in the 200,000-400,000 range, some even lower. Decent, 3/2 homes with modern finishes. These parts of Sunnyvale are right up the road. Once you get into something, over time, you can work up, though you may have to go through downturns. Web Link

Getting into something like that is choosing a better quality of life over likely increase in investment value, so if the idea is to get into a home, it’s better to buy a residential property no matter how bad because it’s more likely to lead to moving up.

There are still homes under 1M in Sunnyvale. Our starter home was in a very bad neighborhood with high crime, drug dealing, etc. Affording it required renting out to two other people and it was a small home that had to be rebuilt while living under very substandard conditions. The tenants chipped in in exchange for lower rents. Sunnyvale properties are going up now because of Apple, so of you can find a way to get in, so.

I wonder why no one has made crowdfunding investment funds available for people in other parts of the country to help finance homes here and share in the market. I was told by a real estate friend that it used to be common for regular people to become the “bank” and finance home purchases here as crowdfunding before there was any tech crowdfunding. Maybe some enterprising company can figure put a way to do downpayments that way.

There are some posters I would very much like to meet in order to have a real time discussion of this issue. Coffee?

@DanielD in PAHills: I like your idea of 1 bed added for every desk added, but we are WAY past the point where we can catch up. Maybe if CC keeps that image in mind, though, they will hesitate a little before adding even more desks. I also agree that ALL development stresses infrastructure. Our infrastructure struggles to meet the demands and stresses of the current built environment in the "flats" of Palo Alto. I think it is time to take breather and do some catching up, particularly with regard to public transportation.

@Mauricio: it sounds like you have left Palo Alto but still care about Palo Alto. Thank you for the book recommendation. As for Kniss - I think she lives in town. Regardless, I take your point. It is not unusual for our CC members to make policies that will never impact them as much as they do others. I sometimes think that a big contributor to Palo Alto's growing problems is that our Council members and other decision makers are too comfortable financially. CC backed us into this lousy housing imbalance corner and it is highly ironic that one way out is exactly what the Council majority likes best: more development.

@What Palo Alto Has Become: thank you for the detailed glimpse about what you know is going on around town; you seem quite well informed.

@Che: you make a good point; suburbia is at risk. Too bad; there are plenty of big cities that would likely welcome those who prefer density. And they generally have the public transportation to support it.

@Allen Akin: your posts are invariably informative and reasonable. Thank you!

Thank you, Allen Akin for directing Gale Johnson to the PAH website for more reliable information than is available in Town Square comments.

Five years ago, I waited too long to ask Candice Gonzalez to respond directly to questions and challenges posed by critics as the Maybell controversy raged. Inaccurate characterizations of affordable housing and PAHC's role as a non-profit corporation, unchallenged by local media outlets, were amplified by anonymous online repetition.

I kept looking for a fact checker to emerge online, or for a skeptical reporter to dig into suspect arguments and write a report that would help the public sort it out. Neither happened, so I went to the source myself to ask the questions I needed answers to as a base for further exploration of the issues. I appreciated Ms. Gonzalez's openness in answering my questions.

Jerry, in your quest for answers from Candice Gonzalez, head of PAHousing Corp., did you happen to discuss with her whether her husband runs a construction company, Golden Gate Homes?

Isn't GGH the company building the private houses in Maybell?

If this is true, then she is co-owner of a construction company.
Please advise.

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@whomever...and that includes all of my fellow commenters, and others:

You are a great group of diverse and strongly opinionated spokespersons, and also a great audience for us PAO participants and contributors who will take the time to listen, and often vent, one way or the other, and then chime in with our own 'two bits' worth of enlightened wisdom/information.

@Annette, I think you've detected who I am. There is no hiding when you post, like I do, using your full name on PAO. That's fine, and that's the way I think it should be. I'll be in touch.

I was happy to see this move forward, only because it will finally be a truly tested case of the 'overlay' idea. Will it prove to be good or bad? Nobody knows, even the minority PTC folks or the CC majority don't know that answer yet. That will take a few years to answer. Just wait and see. In the meantime... keep your 'powder dry', and 'don't give away your shot'.

Further comments:

The cheering by PAF folks was very revealing, conspicuous, auspicious...and suspicious! Why did they do that? Were they rooting for the very low income, low income, and middle income people that serve us so well in our community? Hmmm? I don't think so. Their reaction told it all...sent a bad message...and sign of what this ordinance is all about...mostly taking care of young downtown single techies. Relatively cheap rent and trust me...they will own cars. How do you drive half a car?

I am also in favor of taking care of those middle income folks that seem to be lost, left out, in limbo, in all of this discussion. Good for County Supervisor Joe Simitian, if he can pull off his proposal to provide housing for teachers on the county owned property (parking lot) adjacent to the North County Superior Court building.

And just for the record...before someone does a back check on my previous posts re BV. At one point I did say I favored it as the only solution available, at the time, for providing low income housing, even though it wasn't the best way to do it. My thinking hasn't changed. We keep getting bits and pieces of information on the progress of that project, however. Tenants being displaced on a rotational basis for the much needed infrastructure upgrades to be code compliant. I would be curious how happy the residents are now...and if their lives will go on, as seamlessly as possible, with all this happening. Also if their rents will still be affordable. One concern I always had about it...will those residents still qualify to live there? I guess they were grandfathered in, so any other very low income..low income folks, who might have been more deserving, couldn't bump them out. Politicians have already claimed victory...but the battle still goes on!

Just claiming victory is worth a lot of votes!

ADU's: Please, if I hear any CC candidate touting that as a great accomplishment/achievement I will be very upset. They will have to answer a lot of questions about it. How many were built, where, and for what purpose? How is it helping our housing 'crisis' if granny or any of the other family members are only going to be moved out of the main house and into a cottage in the back yard? How are they doing and are they enjoying living in those units? Certainly they aren't being charged rent, or at least I hope not, or at most, minimal rent. Were there no negative impacts on the neighbors or the neighborhoods? It's on public record who filed and had their building permits approved for those units. I'd like to see a map of PA with stick pins placed in those locations. I bet there are none in the neighborhoods of any of our CC members...and I'll bet there aren't any grannies living in those units.

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@What Palo Alto has become

"Jerry, in your quest for answers from Candice Gonzalez, head of PAHousing Corp., did you happen to discuss with her whether her husband runs a construction company, Golden Gate Homes?"

When you search through my posts (easy to find since I've used my own name throughout in all the threads I've commented on in the past five years) you'll see what I learned, and what I thought about it, on this and related matters.

I think that Weekly coverage of the purchase of the Maybell site by Golden Gate Homes was pretty thorough, as was its coverage of the role of GGH's project manager, Candice Gonzalez's husband, who brought plan after plan to the community for feedback and negotiated the ultimate proposal with a neighborhood working group before it was approved by the city council. A search for Maybell GGH will get you the relevant articles and TS threads.

Big problems often have more than one solution. It is inexplicable to me that here, in the cradle of creativity, we apparently have ONE answer to our self-inflicted housing problem: BUILD.

What if a visionary like Elon Musk offered a reward for solutions that did not involve additional building? Or if the stewards of our city honestly assessed all that is needed to sustain a community our size or even X% larger and said, “Much as we’d like to, we cannot build our way out of this mess. We need other solutions.” What would the answers be?

Question to PAF: Forward to what, exactly? What do you see the as the end game for Palo Alto? Do we just build and build and build? Right now there’s a jobs:housing imbalance, a cars:road imbalance, a cars:parking imbalance, and a diversity imbalance. Do we just keep building until everything is out of balance?

"Question to PAF: Forward to what, exactly?"

The answer is quite simple:Hong Kong.

We wish ... Hong Kong but without their mass transit and other infrastructure. Also, with different standard of living. So, will end in misery way before we get there.

Thanks, always appreciate your thoughts.

Let me crude and straight forward about this: It's the very high price of land which is the fly in the ointment. Build for high density, it's the most efficient form of housing in terms of price and the environment, etc. Ask bees and termites about how to build a city. Now - zoning for "affordable housing" just burdens the investor and creates a sense of entitlement. Especially for those very luck winners of the subsidized housing lottery. What's fair? The non winners end up paying for the lucky winners of the "affordable housing" lottery. Money for building apartment houses in California is now looking in Oregon and Washington state (no income taxes). The initiatives for rent control and "affordable" housing destroys investors' confidence in the sanity of California. Watch as the Buena Vista turns viral again as we proceed in our economics lesson.

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