The Benefits of Selective Height Increases for Housing Projects | Invest & Innovate | Steve Levy

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The staff report for the June meeting of the PTC on Housing Element Update Programs suggested and the PTC adopted certain proposals to increase the height limit for housing on the Stanford Campus and along El Camino. Staff will bring other pitch incentive programs and other housing programs after completing their housing feasibility analyses. By selective sites, I mean downtown, the Cal Ave area, along El Camino, and on some Stanford-owned land on campus and in the city.

These selective height limit increases will be effective and are almost certainly necessary to meet city housing goals and legal requirements.
But the benefits go far beyond efficiency and necessity.

I seek the most efficient, feasible, and least intrusive way to achieve our housing goals while contributing to the regional environment, equity, and local prosperity goals. I realize that not everyone wants to meet our housing goals, but if that’s the case for you, you can skip the rest of the blog.

Background

1. The city’s RHNA goals and comparison to recent trends are shown below.

5th Cycle Permit 6th Cycle
Grant Grant Approved
for permits 2015-21 for permits

Very low income 691 218 1,556
Low income 432 60,896
Moderate income 278 42 1,013
Superior to moderate 587 636 2,621
Total 1,988 956 6,086

A few points are worth mentioning. The most important goal for the 2023-2031 RHNA cycle is affordable housing for upper-to-moderate income residents and this is the largest increase (4 ½ times) over the previous cycle’s goal. Although PA met the 5th cycle goal for this income group, we averaged less than 100 units per year compared to the new goal of 300+ units per year.

The worst performance comparing the first two columns for 2015-2021 is for the moderate income group, too much income to qualify for most subsidies and not enough income for most market price housing.

2. Palo Alto along with Menlo Park, Mountain View, Sunnyvale and Cupertino have been named by the ABAG RHNA Methodology Group as preferred places to live for low-income families and preferred places where housing can help reduce travel regional.

The Environmental Benefits of Selective Increases in Housing Height

In addition to making more sites feasible for non-profit developers and at market rates, height increases will allow us to meet our housing goals with fewer construction sites and the resulting environmental disruption and damage.

Height increases that make sites more feasible, especially for low-income group housing, either as stand-alone 100% BMR projects or as market-rate projects, such as the W. Bayshore project recently approved, which has 20% restricted units, will reduce travel for at least some low- and middle-wage earners who commute an hour or more each way.

The Equity Benefits of Selective Dwelling Height Increases

Staff promised to meet with nonprofit developers to understand the constraints of getting projects done, which is much easier in places like Mountain View and other cities. For my understanding of economics, extra height can increase the likelihood of getting BMT units either as stand-alone projects like Wilton Court or as a condition for extra height in market rate projects. Since there is a broad consensus on the importance and benefits of increasing these dwellings, additional height seems like a no-brainer.

I consider the increased ability of middle-income residents (the many oft-mentioned teachers, nurses, public safety workers and others) to live closer to their place of work to be a huge benefit to them and to our diversity. Me and many, many others who could afford to live here when we were younger now live in a city where it’s not possible for young families like we were then.

To me, that’s just as big a loss of diversity as having a place where more low-income families can find housing.

The Economic Benefits of Selective Increases in Housing Height

This one seems obvious to me as an economist. Working from home will continue at some level and the loss of day-worker customers is an ongoing burden for many small businesses. More customers who live nearby need to help and could be the difference between having a vital downtown and a struggling downtown or Cal Ave area for example.

Here, the benefits of removing constraints to achieve our substantial market rate housing goals are twofold. One, they bring customers with resources to shop and dine in our beloved community and two, if additional height can help produce more housing for low-income residents at the same time, we have what seems to me to be a win-win scenario.

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