City council approves controversial affordable housing proposal

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SAN DIEGO -- A split San Diego City Council narrowly approved a controversial set of amendments to the city's inclusionary housing regulations Tuesday, part of the city's attempt to spur affordable housing development.

The council voted 5-4 in favor of the amendments. If Mayor Kevin Faulconer vetoes the amendments, the council would need six votes to override the veto.

The amendments require developers to increase the portion of a development's units that are kept affordable for people earning a certain percentage of San Diego County's area median income.

The proposal requires developers to lease 10 percent of developments with 10 or more rental units at or below 50 percent of the county AMI for a family of four, $53,500, or 15 percent of units at or below 80 percent of the AMI for a family of four, $85,600.

In addition, developments with units for sale would be required to make 10 percent available for a family of four making at or below 100 percent of the AMI or 15 percent for a family of four making at or below 120 percent of the AMI.

The city currently has similar rules in place, but developers can pay a $10.82 "in-lieu" fee per square foot to avoid offering units below market rate or to families who make less than the area median income. The proposal would also offer incentives for building affordable housing on-site and the in- lieu fee would increase to $22 per square foot by 2021.

The amendments are a keystone issue for City Councilwoman Georgette Gomez, the council's president, who has argued that city officials have sidestepped making changes to the inclusionary housing regulations for political reasons despite a citywide push to increase the local housing supply.

Gomez first floated the proposal in 2017 but lacked the council president's power to docket items before last December, when the council unanimously appointed her to the position.

"This is an important step in developing more affordable housing at prices that San Diegans can truly afford," Gomez said in a statement Monday. "Inclusionary housing is one of many tools to incentivize development of affordable housing and we need to use all of them."

District 7 Council member Scott Sherman argued there are better ways to generate affordable housing construction in San Diego.

"We need to offer incentives to developers not mandates," said Sherman.

The proposal drew a raucous reaction from local housing developers and business leaders, both of whom argue that the stricter regulations will cause rents to spike and developers to flee San Diego County for areas with more favorable regulations like San Antonio, Texas. Such an exodus, they argue, would lead to less affordable housing, not more.

The amendments will also serve as a stress test for the technically nonpartisan council's Democratic supermajority and Mayor Kevin Faulconer's commitment to increasing housing availability and affordability.

Since gaining a six-vote majority during the November mid-term election, the council's Democrats have often overruled both the body's Republicans and the mayor's veto power on controversial issues like gun control, pension reform and supporting a state bill that would limit police use of force.

Faulconer, meanwhile, declared himself the city's first "YIMBY" mayor during his State of the City address in January and has since proposed policies like eliminating building height limits, authorizing unlimited housing density and eliminating parking requirements for new housing developments built near transit, an ordinance the council approved 8-1 in March.

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