Affordable housing advocates cannot convince council to pass linkage fee

Three councilmembers say approval would be bad for
business
by BERT WILLIAMS, News Editor
Windsor idealism smacked into the politics of Sonoma County
economic reality last Wednesday night and the outcome was a 3-2
decision by the town council in favor of the status quo.
“I was hoping we’d be setting an example tonight,” Mayor Debora
Fudge told the council after a long discussion. But the council did
not approve an ordinance that would have required developers of
commercial property to pay a “work force housing linkage fee”
supporting the development of affordable housing in Windsor.
The proposal for the new fee grew out of a 2001 study prepared
for the county and its cities by Economic and Planning Systems,
Inc. The purpose of the study was to determine how commercial and
industrial development affects the need for affordable housing in
the county.
The study concluded that there is a clear link between
employment growth and the need for affordable housing. Creators of
the study also examined specific methods by which employers could
be required to contribute to housing solutions. They recommended a
new developer fee, linking the construction of affordable housing
to job creation.
The town council initially considered implementation of such a
fee in June 2003. At that meeting the council directed town staff
to further pursue the concept, but also indicated that passage of
such a fee could be contingent on other cities in the county taking
similar action.
In August the Santa Rosa City Council decided against
implementing such a fee. Santa Rosa’s action dealt a serious blow
to the prospects of a linkage fee in other parts of the county.
But despite Santa Rosa’s position, the Petaluma City Council
approved what it called a “commercial linkage fee” in Dec. 2003.
That development led some to hope that Windsor would follow suit,
establishing momentum that would carry over to other cities, maybe
even causing Santa Rosa to reconsider its own stance on the
issue.
Cities are reticent to strike out on their own with such fees
because they fear they will be put at a competitive disadvantage in
attracting new business to their communities. Members of the public
who addressed the council Wednesday night, however, did not seem to
share those concerns.
Matt Myers, vice-principal at Cali Calmécac Charter School and a
member of the Living Wage Coalition of Sonoma County, presented
statistics to highlight the housing shortage.
“Between 1987 and 2001,” said Myers, “employment grew by 45
percent, or about 60,000 jobs. The majority of these jobs pay no
more than $30,000 per year.”
Myers cited statistics indicating that 80 percent of households
in the year 2000 could not afford a median-priced home in the
county.
“The Jobs Housing Linkage Fee is a well-targeted strategy
because it links job growth with the need for affordable housing,”
said Myers. “I see this as a really crucial pillar of providing
affordable housing.”
Santa Rosa resident Nancy Richards, president of the Sonoma
County League of Women Voters, said, “Our position continues to be
the same: to require major commercial development to assist with
work force housing.”
Steve Benjamin, representing the Inter-national Brotherhood of
Electrical Workers, also supported a linkage fee. “Union members,
for the most part, can afford housing,” said Benjamin, “but
unfortunately I represent the minority of the work force.”
After others spoke in favor of the linkage fee, Windsor
developer Orrin Thiessen struck a cautionary tone.
“I’m not against the linkage fee per se,” said Thiessen, “but
the ultimate linkage is mixed use. It would be ludicrous to tack a
fee on top of that.”
Thiessen was referring to the mixed use that is common in his
Town Green Village development, in which the buildings offer
commercial space on the ground floor and residential condominiums
on the second and third floors.
“If you’re going to pass a fee, don’t hit us with it because it
will really hurt the downtown development,” said Thiessen.
Following comment from the public, Councilmember Steve Scott
presented the case against the adoption of a linkage fee.
“Trying to make housing affordable is a very important goal,”
Scott said. “The question is, how do you achieve it? I feel that,
to make housing more affordable, we need to have a strong economy,
driven by businesses that are competitive and able to pay good
wages.”
Scott noted that, in the western United States, California has a
problem competing with other states such as Nevada and Colorado.
This is because the cost of living is so much higher in California
than elsewhere. “Even more alarming is the competition for jobs and
businesses internationally,” said Scott. He cited the on-going loss
of jobs at Agilent Technologies and Medtronic.
“Maybe if we drive businesses out (with more fees) people won’t
come to work here, the cost of housing will go down, and we will
have achieved our goal,” said Scott with a note of gentle sarcasm.
“Increasing the cost of doing business in California causes people
to lose their jobs.”
Councilmember Sam Salmon took the opposing view.
“I have experiences every day with people who are unable to live
a healthy and sane life,” said Salmon. He noted that the town has
found ways to promote housing in the moderate range, such as
Thiessen’s development. “But we just don’t have any funding out
there for low and very low income housing,” he said.
Salmon proposed a fee of $1 per square foot on new commercial
development, reduced by 50 percent in the redevelopment area and by
another 50 percent if it is a mixed-use development.
Councilmember Lynn Morehouse lined up with Scott. She said she
would be willing to consider linkage fees if Santa Rosa passed
them, but she was not willing to put Windsor at a competitive
disadvantage with the larger city to the south.
Mayor Pro Tem Steve Allen sided with Scott and Morehouse.
“There’s a delicate balance,” said Allen. “I don’t think we’re
going to accomplish this by targeting businesses. … A lot of the
stores that people really want in town are running on a pretty thin
margin. To discourage that by saying that everybody who starts a
new business has to pay a new fee is not the way to do it.”
By the time the discussion worked around to Fudge, it was clear
that the initiative did not have the necessary votes to pass, but
Fudge harbored some hope that she might get one of the
councilmembers to swing to her point of view.
“I think for businesses to be able to survive, we need to
provide housing that workers can afford,” she said. “I don’t see
businesses here tonight protesting … Because California is in
trouble, this fee makes more sense to me than it ever has. We need
to act locally. We need to take leadership and do it.”
Fudge pressed Allen to consider a compromise that might result
in passage of some form of the linkage fee, but he held firm. “The
concept is wrong,” he said. “I just don’t think taxing businesses
is the way to go.”
At that point it was clear that the linkage fee did not have the
votes to pass.
Later Myers explained his position further. “What turned the
economy around during the depression, besides the war, was putting
people to work – putting money into the hands of consumers, ” said
Myers. “The Jobs Housing Linkage Fee is good for business because
when the cost of housing is more affordable people have more of
their income to spend at local businesses.”
Later, in a phone interview, Fudge said that she was not
surprised at the outcome, but was “very disappointed.”
The compromise suggested by Salmon was so low that it was really
just a token, Fudge said. “But,” she noted, “it would have shown a
spirt of cooperation with other cities.”
She said she fears the vote of the council is a major blow to
the effort for the entire county to get behind the proposal.