Santa Barbara is headed toward an “inclusionary housing” ordinance that would require developers to put limits on the amount of rents they charge some tenants.
The City Council voted 7-0 Tuesday to require 10 percent inclusionary housing for high-density projects in and out of the of downtown central business district.
Unlike a meeting on the same topic two weeks ago, this council refrained from arguing and bickering and came to a resolution without much disagreement. Previously some of the council members wanted a 15 percent affordability requirement – but that higher percentage only mustered 4 votes; 5 affirmative votes were needed to pass an ordinance. Council members said they would rather “pass something” than hold out for 15 percent and risk tanking the entire ordinance.
“This program facilitated building in a city that had not seen building in decades,” Councilwoman Meagan Harmon said, referring to the average unit-sized density (AUD) incentive program. “In my view, that was a good thing, but it doesn’t mean that reform isn’t necessary.”
The city approved the program in 2013, giving developers the right to construct additional units if they built rental apartments.
However, the city at the time did not place caps on the amount of rent that the developers could charge. Developers could charge as much as the market would bear.
Critics said that developers were charging market rents that middle-class families could not afford, effectively defeating the original purpose of the program.
For example, the first project built under the program is The Marc, which charges $3,895 for a two-bedroom apartment.
Critics also said the program was only benefiting developers and not people in need of rental housing.
“Our priority doesn’t need to be in incentivizing development for development’s sake,” Harmon said. “It should be in incentivizing development that is responsive to the needs of working families.”
The new inclusionary housing ordinance caps the rents that can be charged for the 10 percent. The affordable units would be for moderate-income households, defined as those earning between 80 and 120 percent of the area median income, currently $79,300 for a household of four.
It also waives the fee for projects of four units or fewer; for projects between five and nine units, the developer can either build one inclusionary housing unit or pay an in-lieu fee.
Several members of the public called on the council to approve inclusionary housing.
“There’s no housing for the local worker,” said Christine Neuhauser, a longtime Santa Barbara resident. “If developers don’t like it, they should just go back to L.A. or wherever else.
Some members of the public and council said that the inclusionary housing program is needed because developers are replacing older, more affordable, modest housing, to build the new units. The units, by nature of the fact that they are new and bigger, are going to cost more money.
“The AUD causes the destruction of affordable housing,” said critic Anna Marie Gott. “There’s nothing to prevent it. “The only thing the AUD has done is gentrify pockets of Santa Barbara.”
Councilman Randy Rowse said even with inclusionary housing, the city can’t control development.
“It’s a conundrum,” Rowse said. “We’re trying to provide a certain type of housing, but there’s only so much we can control.”
Councilwoman Kristen Sneddon questioned whether the AUD program should exist at all.
“I am not a believer that the AUD is a success for what it was intended,” Sneddon said. “I cannot see propelling the AUD program forward without inclusionary. We should have been in there since the beginning. I think it was an error that it wasn’t part of the original.”
— Noozhawk staff writer Joshua Molina can be reached at jmolina@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.