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Merced Takes Small Step Towards More Affordable Housing

City council members narrowly voted to approve small policy shifts that promote affordable housing over commercial development. While there are some currently underway, no new affordable housing projects have been completed since 2014.

(TNS) — The California city of Merced's gridlock over how to improve an affordable housing shortage made some headway Tuesday night, but only after a lengthy — and at times emotionally charged — discussion that kept City Council members, staff and residents up past midnight.

While the late-night conversation touched on housing in general, the focus was on affordable housing — meaning units with costs fixed so that very low to moderate income-level earners spend no more than 30 percent of wages on housing.

"If we don't plan for a future with more affordable housing, working people won't be able to live in Merced. That's not the kind of future I want to live in," said Merced resident Tanya Golash-Boza.

Merced officials have voiced the need for more low-cost apartments and more multi-family units to help ameliorate the issue. But since 2010, only about 21 percent of all city permits have been for multi-family developments, according to data provided by city staff.

City staff said they took a broad approach to considering ways Merced can improve housing options, including tweaks to its general plan and zoning code.

"We want to encourage all types of housing in your community, and right now your general plan and your zoning code don't do that," City Manager Stephanie Dietz told the council during Tuesday's meeting.

Staff's proposed policy changes approved Tuesday by City Council help shift from policies that favor commercial development to strategies that promote affordable housing — and housing in general.

The complete staff report can be found on the city's website. A few housing policy plans approved Tuesday by City Council include:

* Establishing a residential density for areas zoned as commercial in the city's general plan.

* Streamlining the building permit process for better efficiency.

* Updating the general plan and city zoning to encourage affordable-by-design approaches, where housing is generally built smaller and more efficiently so the market rate is affordable to those earning around a community's median income level.

* Creating standards for tiny homes and updating single and multi-family design standards.

* Becoming a pro-housing community, designated by the state Housing and Community Development department. The designation provides incentives like additional points or other preference in the scoring of competitive housing, community development and infrastructure programs

* Evaluating a housing trust fund and/or housing consortium in partnership with the Merced County Association of Governments.

* Integrating the city's Regional Housing Needs Assessment (RHNA), a representation of future housing needs for all income levels that jurisdictions must plan for in the general plan, into new unit distribution with a committing development agreement.

No new affordable housing projects have been completed in Merced since 2014. The issue is a problem statewide, where the high cost of construction mixed with the intricacies of selling homes for below market rate make for a complexity of funding hurdles.

Some affordable developments in Merced are either currently under construction or have recently received City Council's approval.

Officials and residents' frustration largely stemmed from complaints that the long-anticipated discussion, having been in the works by staff since spring, didn't seriously consider specific policies like inclusionary zoning or enforceable tactics of holding developers to build affordable housing.

Hours of back and forth Tuesday between elected officials and community members, as well as a failed proposal that died via a 3-3 split, ultimately landed on broad-reaching first steps intended to improve the city's housing crisis.

Not everyone was pleased by the decision. Underscoring the council's divided opinion, the proposal only narrowly passed with a 4-3 vote with Council members Fernando Echevarria and Jesse Ornelas voting no. Councilman Kevin Blake was absent.

The divide looked similar during previous affordable housing discussions over policies like inclusionary zoning and an affordable housing trust fund — both of which failed at the time.

Merced's Housing Problem

Albeit not a new problem, Merced's housing issues recently reached new levels of severity. UC Merced in August was forced to delay the start of in-person instruction when officials learned that about 1,000 students, or roughly 10 percent of the student body, were scrambling to secure housing just days before the start of the school year.

Students trying to find housing found themselves in an impossible situation and many were ultimately offered temporary on-campus or hotel rooms, accentuating Merced's housing vulnerability and lack of low-cost options.

They city's longtime low vacancy rate coupled with UC Merced's estimated growth of 530 students per year, according to its long-range development plan — and Merced being among California's fastest growing cities — poses an ongoing problem for renters and low-income residents.

Plus, State Auditor data shows that Merced's severe cost-burden rating, overcrowding and unavailability are all high, as are much of the county's communities.

"I have witnessed the deterioration and lack of affordable housing available to the low and limited income residents of Merced," said resident Gloria Sandoval, who has lived in the city for 45 years. "We are in an emergency and you must act now."

What Some Merced Residents Say Housing Plan Leaves Out

Some residents and affordable housing advocates said the plan excludes key strategies.

Over 30 people commented on the proposed housing policies Tuesday night. Few took issue with what was included, but many noted what they saw as a gaping hole: inclusionary zoning.

Inclusionary zoning was previously up for debate during a City Council meeting in April. The policy requires new market rate housing projects to allocate a percentage of units to affordable housing, thus integrating affordable housing units with traditional market rate developments.

No city within Merced County has adopted an inclusionary zoning program, but many cities and counties throughout California and beyond have.

Proponents say it helps get affordable housing built and promotes equitable distribution of affordable units, thus better integrating residents of different economic levels throughout a region and deterring concentrated areas of disparity. Critics argue that inclusionary zoning stifles new housing construction rather than propel affordable housing forward.

April's meeting resulted in the City Council voting 6-1, with Blake dissenting, to continue the inclusionary zoning conversation to Tuesday's overarching housing discussion with more information about what a Merced-specific policy would look like.

A few individuals with experience in housing development warned against inclusionary zoning on Tuesday, but some council members and many residents expressed dismay that inclusionary zoning was scarcely mentioned in staff's recommendations.

The exclusion was unexpected due to the number of community members who expressed support for it in April, several residents said.

"It got mentioned for about 60 seconds," Ornelas said. "We didn't ask for a policy, we asked or some information on it. And we didn't get it. It's disappointing and its frustrating."

Critics of the council-approved housing policies also pointed to the vagueness of an affordable by design approach.

"Affordable by design is not a policy," said resident and Leadership Counsel for Justice and Accountability Policy Advocate Sheng Xiong. "It should not replace a requirement to build affordable housing."

The adopted plan ultimately excludes any specific mechanisms to ensure that developers are building affordable housing in Merced, Xiong said.

City staff said that following the council's April discussion of inclusionary zoning, the policy was seriously weighed. A lack of support by the majority of City Council led efforts to prioritize alternative tactics that would accomplish similar ends to inclusionary zoning, like using RHNA as a development guide with a development agreement serving as an enforcement mechanism.

But several council members echoed Xiong and others' thoughts.

"This policy must include language for enforcement," Echevarria said. Ornelas and Councilmember Bertha Perez echoed Echevarria, each also voicing their support for inclusionary zoning.

Ornelas made a motion to pass staff's recommendations with the addition of a fine for developers who don't build affordable housing. The motion failed 3-3 with Mayor Matt Serratto, Councilmember Delray Shelton and Councilmember Sarah Boyle voting no.

A second motion by Serratto moved to adopt staff's proposals and come back at a future meeting with ways to enforce construction of affordable housing. That plan passed with Ornelas and Echevarria voting no, in part due to inclusionary zoning continuing to be left out.

(c)2021 the Merced Sun-Star (Merced, Calif.) Distributed by Tribune Content Agency, LLC.

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