Access to Opportunity(?)

In 2016, the California Tax Credit Allocation Committee (CTCAC) proposed restricting the expenditure of LIHTC subsidy in any area deemed “low opportunity” according to the UC Davis Center for Regional Change (CRC)’s Regional Opportunity Index. Affordable developers, particularly non-profit organisations, pushed hard against the proposal, which CTCAC abandoned.

CTCAC is again moving forward with a similar proposal in 2017, but after months of consultation with a team of academics who devised the mapping.  (full disclosure as a former CalHFA staffer I sat in on and contributed to those conversations).

The idea of making it a policy goal to build more affordable housing in high opportunity areas is a noble one, but many people disagreed.  I want to highlight common argument made by affordable developers against proposal that challenge the notion of what access to opportunity is.

Here’s a comment that really struck out at me:

“The most troubling aspect of this proposal is that it would bar the
development of farmworker housing in agricultural communities. ” Pat Sabelhaus, California Council for Affordable Housing

Not everyone lives in “high opportunity areas” because the jobs they do aren’t always there because of the nature of the work.

Here’s another common argument:

” In many cases, low-opportunity areas are those most at risk of gentrification and displacement. There are other alternatives that should be considered.” (Rob Wiener, California Coalition for Rural Housing; Rachel Iskow, Mutual Housing California)

Opportunity itself is not static over time, it moves as we do–could rejecting affordable housing in low opportunity areas today mean we have none in the gentrifying areas of tomorrow?

And here’s the last very common argument:

“In the East Bay alone, there are thirteen BART stations that are in or within one-quarter mile of a “Lowest Opportunity Area.” We believe it is incredibly important to build housing in these transit-oriented areas to most effectively link people to job opportunities. ” (Andy Madeira, Eden Housing)

This brings up a lot of questions.  The ridership of BART is systematically wealthier and whiter than the general population.  Is this because the land value uplift effects push people out, or is it because the system was designed to connect people to San Francisco’s Financial District, which is disproportionately a middle and upper class jobs hub?

If it is the former, then Andy is right. We should build lots of affordable housing around BART.  But if it is the latter, then maybe we need to re-conceptualize what is important for job access and affordable housing.  There’s a wide literature suggesting that jobs access to affordable housing does not make it easier for those tenants to actually access employment… Are we still focusing on this because it’s easy to measure?

Here’s a look at the new opportunity map.  The darker the colour, the higher the opportunity:


We know people are, unfortunately, calling Bay View-Hunters’ Point the “last frontier” of gentrification in SF–which means now is the time to place a lot of affordable housing in there.  But this map does not prioritise it.

We also know Marin County is a bunch of exclusive, hypocritical jerks who need to build more affordable housing–and this map suggests we should build more there.

So maybe just carrots for affordable developers on LIHTC and access to opportunity, and no sticks?


Could Income-Restricted 2nd Units Work In Melbourne?

Image result for Australian secondary dwelling unit

An ADU somewhere in Australia. Sexy…  I’d live there.  Want privacy? Just put the garage door down.

In this post, I am going to test if an income-restricted affordable 2nd unit could pay for itself without government subsidy.

To do this we have to start with the household sizes and income levels that would be appropriate in this context.  Given the sizes of this kind of unit, I don’t think it would be fair to expect accessory/secondary dwelling units (ADUs, for short) to hold more than two occupants.

Here’s the rough annual rents paid by Very Low Income and Low Income households at those sizes:

Table 1: Max Annual Rents by HH Size and Income*
1 2
Very Low $9,724 $11,128
Low $15,548 $17,784

For background on how those income levels and rents are determined, see this post.

Under the “housing as infrastructure” concept, imagine a super fund putting $100,000,000 into a non-profit’s hands to build ADUs across Melbourne.  The fund would need a 7%/year return at current interest rates.  Making a few assumptions about annual maintenance costs (footnoted below*), I can calculate how much hard debt an ADU could carry over a fifteen year period based on the rent maximums posted above plus any residual revenue:

Table 2: 15 Year Serviceable Debt (and residual revenue)
1 2
Very Low $81,971 and ($15,818) $91,079 ($22,994)
Low $118,403 and ($47,353) $182,158 ($65,158)

ADUs are expected to range between $100,000 and $125,000 a unit in cost.  What Table 2 shows me is that ADUs with statutory limits to serve Low Income households could pay off construction debt with plenty of room to spare.  It also tells me that if the government kicked in just a small amount of equity, ADUs serving very low income households could be easily served through a program of this kind.

So, why on earth would any home-owner want to do this?  Here’s some ideas:

  1. So you can retire into something manageable and rent out your main home for income or pass on to your children.
  2. So you can rent out the ADU to a young working person who cannot afford sky high CBD rents, or a family friend who is recently divorced and cannot find an affordable place to live, etc.
  3. Have I mentioned it raises your property values?  A lot of buyers are attracted to owning a parcel with an income generator literally sitting in their backyard.

Now this dreamy vision I’m laying out could be complicated by a few issues, namely: the city or neighbours complaining about ADUs, trying to stop them, or demanding absurdly high impact fees or in-lieu parking payments.

So here’s an idea many people have said before that I’m asking you to consider again:

  1. By-right approval for ADUs serving low income households in transit-rich neighbourhoods,
  2. … Financed by a housing-as-infrastructure loan

The benefits of ADUs are not exclusive to affordability.  There’s also benefits around creating senior-friendly housing, encouraging (or helping to sustain) inter-generational mixing, promoting sustainability, and reducing social isolation.

Related image

Lovely backyard edition, don’t you think? / This looks like Ms. Honey’s house (From Matilda)


  • $500/year set aside for maintenance, $120 for insurance, $50 for other random stuff.
  • Loan assumptions: 15 year fixed interest rate of 7%.
  • Financing assumptions: rents and costs assumed to increase at 2% a year, value of money expected to decline 3% annually

Melbourne–Affordable Rents Under the U.S. System


In this post I’ll present what rents and income limits in Melbourne would look like if they were based off the U.S. system.  In the U.S., most affordable housing limits and definitions revolve around the Area Median Income.  This is the median rent among four person families (a throwback to the 60s!).  In Melbourne, this is $85,448.  This income is then multiplied by a set of factors to produce a median income for each size of household:

        Number of Persons In Household–Area Median Income
1 2 3 4 5 6 7 8
Median $59,842 $68,390 $76,939 $85,488 $92,327 $99,166 106,005 112,844

This is done in recognition of the fact that households of different sizes have different financial needs.  The ratios used are based on data gathered by the U.S. government, although they have not been updated in a while…  It is entirely possible the relationship between household size and income in Australia is quite different.  Do these seem fair to you?

Eligibility to participate in affordable housing depends on how your household income compares to the median for a household of the same size.  In the United States, public housing and the most generous public assistance go to households deemed “Extremely Low Income” (ELI), or those making less than 30% of their respective median.  These are the upper income limits for falling into that category in Melbourne, you would only be eligible if your income fellow below these limits:

 ELI Number of Persons In Household by ELI Income Limits
1 2 3 4 5 6 7 8
Below $17,952 $20,517 $23,082 $25,646 $27,698 $29,750 $31,802 $33,853

The next segment of the population served by affordable housing are in a category called “Very Low Income” (VLI), or those making between 30% to 50% of the Area Median Income.  To be eligible in Melbourne, you would have to fall in between these bandwidths:

 VLI Number of Persons In Household by VLI Income Limits
1 2 3 4 5 6 7 8
Above $17,952 $20,517 $23,082 $25,646 $27,698 $29,750 $31,802 $33,853
Below $29,921 $34,195 $38,470 $42,744 $46,164 $49,583 $53,003 $56,422

The last segment of the public eligible to participate in most affordable housing programs in the U.S. context are those considered “Low Income” (LI).  These are households with incomes between 50% and 80% of Area Median Income.  In Melbourne, this would be:

 LI Number of Persons In Household by LI Income Limits
1 2 3 4 5 6 7 8
Above $29,921 $34,195 $38,470 $42,744 $46,164 $49,583 $53,003 $56,422
Below $47,873 $54,712 $61,551 $68,390 $73,862 $79,333 $84,804 $90,275

Does your household fall into any of this categories?  If it does, and you participated in an American housing construction program of any kind, your rents would be set at a statutory maximum of 30% of your income.

These statutory limits as applied in Melbourne, at a weekly rate, are here:

Max Rents By Income Group and Number of Persons In Household
1 2 3 4 5 6 7 8
ELI $112 $128 $144 $160 $173 $186 $199 $212
VLI $187 $214 $240 $267 $289 $310 $331 $353
LI $299 $342 $385 $427 $462 $496 $530 $564

What do you think, Melbourne?  Does this approach seem fair?

One thing I will say is that making this work in Melbourne may require mixing apartments at these rents into buildings that also cater to those at or above median incomes, with the difference paid for through support from the government.  But more on that in a future post…

Bikeshare = Displacement Debate

I’m currently in the middle of drafting a data-driven post comparing Australian and Californian cities, but I decided to just jot some thoughts on a news article I saw on twitter tonight:

Bikeshare expansion blocked in the Mission over gentrification fears

Let’s talk about this.  First, this should come as absolutely no surprise to anybody.  The idea of bike lanes as painted white “lines of gentrification” has been around since at least 2010. Covering Portland, Lubitow and Miller noted frustration by North East Portland (OR) Black community members regarding the City’s sudden concern for safe cycling only after white folks started moving into the area.  As one respondent says,

‘‘You say you want it ‘safe’ for everybody, how come it wasn’t safe 10 years ago? That’s part of the whole racism thing.we wanted safe streets back then; but now that the bicyclists want to have safe streets then it’s all about the bicyclists getting safe streets.’’

Page 123 of Lubitow and Miller

This is something that all the critics of Calle24 and the anti-displacement movement need to understand.  It’s about whose needs are prioritised.  It’s not that Latinos don’t bike.  It’s that bike share systems probably do not cater to the needs of those who do, and that those who do likely never asked for this to begin with.

Take jobs for example: does the older long time resident of the Mission who lives in a rent controlled apartment cycle down to the CBD to work everyday?  Probably not. Because if her/his job was located in the CBD, then when s/he started work back in the 1990s it wasn’t a hospitable mode of travel.  So s/he began taking the bus or BART.  And that became a habit. It’s also likely s/he works in a field like construction, hospitality, or other services that are not concentrated in the CBD or anywhere near a bike share station anyways.

But there’s also something even more obvious that apparently needs to be said: if s/he is an avid cyclist, they probably don’t need bike share. S/he probably already has a bike.  So again: whose needs is the Bike Share system serving?

The literature on the bike shares suggests systems vary widely in terms of the users’ reasons for traveling.  On page 16 of that same literature review, they note something astounding about DC’s Bike Share system:

“Results showed respondents were disproportionately Caucasian (78% compared to 34% in the Washington DC Census). Only 5% of respondents were Black/African American, compared to 50% in the Washington DC Census. When looking specifically at annual members however, only 2% are Black/African American.”

Page 17 of Fishman et al.

Why might this be? Here’s a big hint (from the same lit review):

“Finally, in the previously cited large scale study by Shaheen et al.
(2012), bike share users in North America were found to be more likely than the general population to live closer to their work, and this is consistent with known determinants of commuter cycling, on private bikes (Heinen, van Wee, & Maat, 2010).” emphasis added.

Page 17 of Fishman et al.

Who in San Francisco is living close enough to work that bike share makes sense, but not so close that walking is a better option?

Should anybody be surprised–should it even be news–that groups worried about displacement do not want Bike Shares in their neighbourhood?

Just saying…

Fun Paper Titles I Want To See


On the significance of an aging suburban society for our quality of life.


“The Suburban Gentry.”

On people who pay their grandparents’ property tax levels thanks to Proposition 13. 


Say What?! A Critical Response to ______________”

Just someone responding to another academic paper.



On the housing politics in San Francisco.



Density Penalties for Affordable Housing Proximity to S.F. Homes

For an upcoming lecture I’m talking about exclusionary zoning.  As always, I am surrounded by ample examples of whatever I am teaching here in California.

Davis is about to approve Creekside, a small affordable housing complex for seniors.  Roughly 40% of the 70 units will be set aside for formerly homeless individuals and those with special needs. Amazingly, this site is also across the street from a typical California tract, ticky-tack suburban subdivision (one I’ve rented in recently).


Highlighted site across the street from single family tract homes (the red roofs)

This is really remarkable.  Because I’m still in the area, I’m privy to all the ugly vitriol against the proposal on  Much of whats in the proposal for the site is designed to minimize the ‘asthetic impact’ of the site.  This is reflected in the zoning.  The figure below, lifted from a report by city staff to the Davis Planning Commission, compares the previous zoning (left) to the proposal of the site.

What it illustrates to me is that zoned densities do not matter, even in towns where local NIMBYs treat the General Plan like some kind of holy document.  I want to advance the hypothesis that developers take density penalties–voluntary reductions in density below zoned limits–to assuage NIMBYISM.  Presumably, the ‘Density Penalty’ is correlated with proximity to owner occupied housing across space.

Here’s the density penalty for Creekside:


The General Plan density for the site (left) and the project’s attributes (right)

It reminds me of things I’ve seen repeatedly in debates over projects, both market rate and affordable.  Developers appear to sacrifice height and floor space (via expanding front setbacks).  If the site abuts a highway, then developers will absorb all the rear setback and build a sound wall.  The goal appears to be increasing front setbacks–minimizing the ‘aesthetic pain’ of drivers-by.

In a different Davis planning commission meeting, a commissioner strongly criticized a proposed project for its aesthetic damage, saying, among other things, “the people who have to drive by this monstrosity deserve better” and comparing it to Soviet Bloc housing.  See it below:


“Monstrosity… Soviet-style housing… We deserve better! The drivers who pass by deserve better!” –How an insane Davis Planning Commissioner described  this image. 

In both cases, developers emphasized reduced heights and increased setbacks.  To win anything near single family residences, we have to mask density… we have to pay that premium.  Actual densities do not matter.  Populations served often do not appear to matter… maintaining the suburban illusion is apparently something we all must pay for through reductions away from highest and best use!

What the UC & NIMBYs Have In Common

note: this is more of a late night venting than an intentional blog. 

Episodically, during my 10 years as a UC brat, I’ve heard it basically said that “students graduate in four, six years… but the faculty & administration will spend the rest of their lives here… so we must prioritize labs, monuments & offices… but not the demands of students… like on campus affordable housing.”  It has a certain logic to it.
Off Campus, at least here in Davis, you will hear actually hear landlords say–quite bluntly– “students only live here for 4 years and then move on. Home owners spend the rest of their lives here. So we should only listen to home owners.”  It also has a certain logic to it.

Two sides of the same coin.

Here’s a comment by a Davis landlord on the competing views of students and home owners over a development that recently passed:


Implicit in this statement is the idea that the value of your opinion in “citizen planning” (something Davis pats itself on the back for having) is proportional to how long you will be staying in said community.  We have a vacancy  crisis (0.3% vacancy rate).  We have students sleeping in cars.  And apparently this should be discounted because this is a “short term” need… (it’s not, UC Davis will be around another few years probably, but the individuals in crisis will only be our problem for a few years so their needs should be ignored, or so the commenter thinks…)

The logic unravels when you find out most of the NIMBY homeowners in Davis are only in Davis because they were UC Davis students or staff at one point.  But let’s look beyond college town dynamics…

Here are my questions for someone defending this kind of thinking anywhere in California (or anywhere period, for that matter):

  1. Does this mean we should value a farm-worker’s voice at 1/2 a home owner’s, since farm-workers only live here seasonally?  Same logic, applied to a different population…
  2. Since out of state students may plan to move back home, should California ban them from voting in our state? Same logic, same population…
  3. The chronically homeless are impermanent everywhere–should they be ignored everywhere? Same logic, overlapping populations…

And then I realize that this landlord gets what she wants most of the time in terms of power dynamic… and she’s complaining because this time the home owners didn’t get everything the wanted (admittedly, the home owners most impacted  for this particular projects are lower income themselves… which also tells you a lot about Davis!)  And come to think of it, its a retirement community.  So this landlord gets what she wants in a sense:  If “the rest of your life” in the community is the weight of the value of your voice, then of course the seniors get stuck with the “undesirables!”  The grotesqueness of it all comes full circle. I’m exhausted now.

Thanks for listening.  This was a rant. Not a thoughtful blog.  But I had to put this on paper because the logic people use to rationalize their exclusionary politics is quite frustrating.