As the City works on its revision of the General Plan Housing Element in the new few months, the Chamber will be pressing for a new, fairer system to finance subsidized affordable housing.

For several years, government’s  efforts at developing “affordable housing” has been primarily financed by requiring developers to sell a percentage of their homes at substantially below “market rate.” This is called “inclusionary housing.” The problem with this system is that as developers spread the costs of the below market rate housing to the rest to the rest of their project, which significantly raises the cost of the market rate units. Thus the housing is cheaper for the tiny number of people who can qualify for subsidized housing, and is more expensive and un-affordable for everyone else.

The Chamber has been skeptical of this public system for years, feeling that a better solution would be private-sector based with incentives for developers to build smaller units with more units per acre, thus reducing costs for all buyers. But if inclusionary housing is inevitable (as it seems to be) the Chamber feels that a fairer, more broad-based financing system for it needs to be found. If work force housing is of general community benefit, then it ought to be financed by everyone through a general tax or assessment district, and not just by the small number of people who are buying new homes.