Monterey County staff to engage public on inclusionary housing

SALINAS — A local law determining what percentage of residential home construction must be affordable is getting a second look by elected officials as housing costs continue to outstrip middle-class incomes in Monterey County.

Inclusionary housing is part of the county’s general plan – a set of documents outlining how development will expand in the future. The inclusionary housing – sometimes viewed as affordable housing – has not been updated since the last general plan update in 2010. Inclusionary does not necessarily mean affordable. It just means below market rate home prices.

The inclusionary housing component sets a percentage of the total units constructed. It is currently set at 20% so a 100-unit development would need to provide 20 affordable units.

But developers tell county planning staff that inclusionary housing is an impediment to building more homes and should be lowered to 15% while affordable housing advocates are calling for an increased percentage.

There is an argument from developers that building more homes and thus increasing the supply will lower prices. But housing advocates point to what they see as the majority of homes being built are detached single-family homes that increases the profit of developers but does little for affordability.

On Tuesday Erik Lundquist, the director of housing and community development for the county, briefed the Monterey County Board of Supervisors on the progress his department has made and asked them for direction on the best way to engage the community about their perspectives on inclusionary housing.

He laid out three different approaches to engagement: “informed,” “consulted” and “involved.” Informed means the county will keep the public up to date; consulted means planning staff will ask the public questions; and involved means the public will participate in and help guide the process of determining an appropriate inclusionary housing requirement.

Supervisors opted for the “involved” level of engagement.

“Affordable housing is a priority to the community and to this board,” said Supervisor Wendy Root-Askew, the chairwoman of the board.

The county hired LeSar Development Consultants to provide technical assistance to the process but the pace was slowed because of the transition to a newly formed Housing and Community Development Department, which combined two previous departments.

The COVID-19 pandemic and staffing shortages also contributed to the slow progress, Lundquist said. The contract for the consultants has been extended until Dec. 31.

Root-Askew acknowledged that any housing is good housing but that “thousands of homes have been built in my district yet homelessness is increasing.”

Lundquist told the board that a high percentage level of inclusionary housing “doesn’t allow developers to pencil out,” apparently in relationship to profit margins.

Darby Marshall, a housing analyst with the county, said that with so-called “workforce housing” reaching up to 180% of the county’s median income, professions such as teachers are being priced out of the market. Higher paying professions (with overtime) like police and fire are more able to afford those prices, but not easily, Marshall said.

“Teachers don’t have overtime unless they take a second job,” said Supervisor Mary Adams.

All the supervisors agreed that affordable housing needs to be a priority for the board and that all means of providing more affordable homes need to be explored. Lundquist said he wouldn’t be able to support a reduction in the inclusionary housing percentage.

“It would be a step backward,” he said.