City Council Approves Changes to San Diego’s Inclusionary Housing Law, Which Mostly Affect Coastal Areas

by on January 26, 2022 · 3 comments

in Ocean Beach, San Diego

On Monday, January 24, the San Diego City Council voted 8-1 to make changes to the 2019 “inclusionary” housing law that requires builders of market-rate housing projects to include low-income units or pay steep penalties.

In 2019, the city council forced developers of 10 or more units to reserve low-income units for residents who make less money and roughly doubled the penalties developers must pay if they don’t build low-income units. A low-income unit is defined as one reserved for someone making less than 60 percent of the region’s median income, which is $72,720 for a family of four.

Most of the approved changes will affect only coastal neighborhoods. In those coastal areas, the changes to the inclusionary law mean it will now apply to all projects with five or more units. For the rest of San Diego, it will apply to all projects with 10 or more units. The Coastal Commission requested this change due to the 30-foot coastal zone height limit and the smaller-scale developments that are more common in the area.

Also the amendments will prevent developers in coastal areas from converting old hotels or motels into low-income units, because the Coastal Commission prioritizes the preservation of low-cost lodging near the coast.

Some of the changes affect the entire city. They give developers more choices of where to build low-income units if they choose to put the low-income units off-site of their main development, which most developers do. The city will continue to allow the low-income units to be built either within the same community planning area or within a mile of the market-rate project. According to the SD U-T, “the proposal eliminates an exception that allows the low-income units to be built farther away if the developer builds 5 percent more units than otherwise required.”

Instead, developers would have to build the low-income units within a half-mile of mass transit or in areas targeted for new housing development by the California Tax Credit Allocation Committee. In addition, the community planning area where the low-income units would be built would need to have less than 5 percent of its housing units be government subsidized.

Last summer, the  California Coastal Commission raised some concerns over the proposed changes and recommended amendments that satisfy the requirement that the Commission approve the new changes to the law in order for it to take effect in coastal neighborhoods, which are areas west of Interstate 5.

Councilmember Chris Cate, the sole Republican on the Council, was the sole “no” vote on Monday. He also voted against the original 2019 inclusionary housing law.

The calm portrayed by Council during this vote was in contrast to what happened when the Council was all set to approve the changes back on January 11 but balked when they confronted Mayor Gloria’s staff. Several Council members accused the planning staff of downplaying the citywide impact of the changes.

According to the U-T:

[The Council] said city planners made it appear that the latest changes would only affect coastal areas, contending they wouldn’t have known about the citywide impact unless they had been alerted to it by the city’s independent budget analyst.

“The title of the staff report was Coastal Commission recommendations and I really thought this was all coastal overlay issues,” said Councilmember Marni von Wilpert. “I’m kind of caught off guard.”

Jen Campbell was mad at both Gloria’s staff for being disingenuous and at the Coastal Commission as it was overreaching in its recommendations. Campbell said, “I object to even having this presented to us, as it was presented as a coastal commission change and not citywide.”

IBA analyst Jillian Kissee was praised by Council President Sean Elo-Rivera for noticing the citywide impact and alerting the Council to it.

The U-T commented:

Supporters say an important benefit of inclusionary housing is that it allows low-income residents to blend into a mixed community. But city officials say they allow units to be built off-site because demanding they be built on-site would prompt many developers not to build at all.


{ 3 comments… read them below or add one }

Mat Wahlstrom January 26, 2022 at 7:00 pm

“But city officials say they allow units to be built off-site because demanding they be built on-site would prompt many developers not to build at all.”

This quote is the biggest tell of all. Using the word ‘demanding’ instead of ‘requiring,’ coupled with a threat that if you don’t let them rob you they can legally break your kneecaps.

*Everything* is about maximizing profits for their developer donors. And if you can pay enough for play, you can get away with surplus can extract from the value of the neighborhood you destroy by building safe deposit boxes in the sky.

The city’s real ‘affordable housing’ strategy is to create a slush fund for unbuilt — and at a build-out tipping point physically impossible to be built — virtual housing, the float from which they can tap. Or spend on equivalent measures, like rent subsidies that will artificially keep propping up land and tax values.

And they have the audacity to claim that their goal is to promote ‘equity’ and ‘inclusion’!

There’s simply no way to get actual affordable housing built without actually building it — at the same time, on the same site, in adequate amounts — to offset the loss of the existing affordable housing it replaces.

Claiming anything else is just pissing on our legs and telling us it’s raining.


Helen Rowe Allen (Dr/Ms/Esq) January 27, 2022 at 11:07 am

Thanks Mat, love the language, better than a first in the morning cup of coffee. Keep on keeping on, we need you.


Mat Wahlstrom January 27, 2022 at 11:57 am

Thanks as always for your support and encouragement, Helen.

Speaking of language, this gives me the chance to fix the third paragraph: “And if you can pay enough for play, you can get away with extracting all the surplus value of the neighborhood you destroy…”


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