East Palo Alto council directs staff to draft temporary housing incentive program after heated study session

The East Palo Alto City Council voted on March 24 to ask staff to draft a temporary Housing Development Incentive Program that would reduce some inclusionary requirements for a limited time while the city participates in a countywide feasibility study.

The council's action followed a study session in which city staff and consultants from Street Level Advisors reviewed the structure of the city's inclusionary housing ordinance (IHO), the economic trade-offs those policies create and examples from other Bay Area cities. Housing project manager Yahaira Morales summarized the current IHO: it applies to new construction (accessory dwelling units are exempt), requires 20% of units on-site for projects of five or more units for both rental and ownership product types, and specifies deep affordability tiers for rental projects down to about 35% of area median income (AMI). Morales also noted the city is participating in a countywide nexus and feasibility study requested by the State Housing and Community Development Department (HCD).

Rick Jacobus, principal at Street Level Advisors, told the council inclusionary policies must be calibrated to market feasibility. "Inclusionary sort of piggybacks on market-rate housing," Jacobus said, urging the council to…