Council adopts updated local-preference policy for new affordable units; asks staff to study foreclosure-era displacement

The council adopted an updated local-preference policy intended to prioritize East Palo Alto residents for affordable housing lease-ups and resales. Staff recommended replacing an earlier point-based scheme with a simpler, tiered approach: an applicant qualifies for preference if they (1) live in East Palo Alto, (2) work in East Palo Alto, or (3) were involuntarily displaced from an East Palo Alto residence. The policy would apply to initial lease-ups, turnovers and inclusionary units and establishes a baseline 50% share of units subject to the local preference, while permitting a higher percentage if a disparity study supports it.

Housing consultant Tim Davis explained that the 2020 point-based system proved administratively complex and that a simplified applicant-only criterion would be easier to implement for immediate lease-ups, including the upcoming Colibri/Calibri Commons project. He described examples of documentation that could demonstrate involuntary displacement (eviction records, police or shelter certification, code-enforcement notices, or documented rent increases and subsequent moves) and staff indicated the draft guideline uses a five-year lookback for displacement claims. Council members and public commenters urged the broadest reasonable definition of displacement — including foreclosure and predatory lending from earlier decades — and asked staff to study how far back supportive documentation could be applied without raising fair-housing concerns. The council approved the updated policy and directed staff to finalize guidelines, explore adding foreclosure-era displacement as an eligible category where legally defensible, and pursue disparity studies as appropriate to expand the share of units that can be set aside for local preference.