State orders Bay Area cities to build 441K new homes by 2031

A state housing department has given failing grades to 14 of 15 Bay Area city housing plans, with final drafts to build 441,000 homes due early next year.

The California Department of Housing and Community Development has rejected drafts from all but one of the Bay Area municipalities it has reviewed to date, with Alameda the lone success, the San Jose Mercury News reported.

Under state law, cities and counties have until Jan. 31 to finalize their so-called housing elements – detailed plans on how to meet increased state-mandated housing goals.

By 2031, the nine-county region must approve more than 441,000 new homes, more than double the amount for the current eight-year cycle.

The housing agency ordered San Francisco, Oakland, Sunnyvale, Mountain View, Redwood City, Antioch and others to rewrite their drafts and submit proof the sites identified for future homes have a realistic chance of development. The requested housing elements also must offer the possibility of rezoning certain neighborhoods for denser housing.

Public officials and housing experts say the denials weren’t a surprise given the state’s high bar.

But the housing department’s hard line is raising questions about whether Bay Area cities and counties can meet the deadline by the end of January.

Failing to do so risks missing out on affordable housing and infrastructure funding, and could put local jurisdictions at risk of lawsuits, fines and the loss of local control over land-use decisions.

“I don’t know if we’re going to meet the deadline,” Mountain View Mayor Lucas Ramirez told the Mercury News. “We’re going to do the best we can. It may very well be that HCD says this is a strong start, but you have to do even more.”

In Southern California, only 48 of 196 local governments have submitted finalized housing elements after most blew their October 2021 deadline.

The City of Alameda spent years preparing their 228-page housing plan, which the state approved in August.

Planning Director Andrew Thomas said while some residents protested the small East Bay island city’s plans to accommodate more than 5,800 new homes, it was important to finalize the draft so the City Council could adopt it before the November election.

Gov. Gavin Newsom made clear last month that, unlike in years past, state officials aren’t going to look the other way if cities and counties ignore their housing responsibilities.

In addition to withholding grant funding and imposing mandatory rezoning timelines, the state is threatening to sue non-compliant governments to compel a judge to take over the process for approving and permitting new homes.

“At the end of the day we need to see local accountability,” Newsom said. “We’re going to celebrate success, but we’re going to call out failure.”

Newsom highlighted a first-ever state probe by HCD into San Francisco’s restrictive housing policies.

He also singled out Atherton, the wealthy enclave in San Mateo County that scrubbed its housing element draft of townhomes after local tech moguls – including billionaire venture capitalist Marc Andreessen – objected to multifamily housing.

Atherton Mayor Rick DeGolia said building affordable multifamily homes isn’t practical because the cost of land in the town is $8 million per acre, and there is little publicly owned land to develop.

Instead, Atherton’s housing element draft focuses on allowing homeowners to create in-law units for rent.

“If (state officials) refuse, we’re going to be in a fight with them,” DeGolia said. Based on Southern California’s example, he expects to have until the end of 2023 to come to “some settlement with the state.”

— Dana Bartholomew

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