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San Jose Blasted Over Affordable-Housing Law

SAN JOSE, Calif. (CN) — Housing advocates sued the city of San Jose claiming the city's latest affordable-housing ordinance violates state law.

Housing California, Urban Habitat Program and two individuals sued the city in Santa Clara County Superior Court, claiming two exemptions the city baked into an ordinance that gives affordable housing purveyors the first crack at developing city-held property violate a state law.

"The city's refusal to comply with the Surplus Land Act will cause a reduction in the availability and sites for affordable housing in San Jose," the July 21 complaint states.

The Surplus Land Act is a California law passed in 2014 that requires that cities, towns and counties who are looking to unload land they own must first offer affordable-housing developers the opportunity to develop the property before selling it.

San Jose passed its own modified the version of law in April, adding two exemptions — one that allows the city to bypass the law if the property is in the downtown corridor and has the potential to accommodate high-rise development, and the other for economic development purposes.

"Let's say a Google, Apple or a Facebook wants to open up something, the city would help facilitate that," San Jose City Attorney Richard Doyle said in an interview Tuesday.

However, the plaintiffs say the city is prioritizing economic gain over the well-being of its less fortunate residents, and doing so in the midst of a full-fledged housing crisis.

"The city enacted its illegal policy even as San Jose, like all of California, faces an extraordinary housing crisis," the complaint says. "There are too few homes available for low-income residents."

More than 78 percent of low-income residents overpay for housing in California (pay more than 30 percent of their monthly income, the complaint says.

The problem is even more acute in San Jose, where more than 90 percent of residents making between $20,000 and $35,000 pay more than 30 percent of their monthly income for housing, according to the U.S. Census Bureau.

Sarah Anderson, one of the individual plaintiffs, lives in an overcrowded apartment with her two children, ages 13 and 9, according to the complaint. Anderson became homeless after a domestic violence incident and struggled to find affordable housing.

She cannot leave the Bay Area due to stipulations in her custody and visitation orders for her children and currently spends more than 50 percent of her income on housing, the complaint says.

The city does not dispute the gravity of the housing crisis in San Jose and the rest of the Silicon Valley.

"We agree," Doyle said. "There is a significant housing crisis. The only question is how to tackle it."

Doyle said San Jose has taken substantial steps by passing an inclusionary housing ordinance in 2010, mandating changes in zoning and undertaking other provisions aimed at providing more available rentals and places to own.

"We have a very aggressive low- and moderate-income housing program," he said. "We fund developers and in some cases we do it ourselves."

San Jose, because it is a charter city, does not have to comply with each element of the Surplus Land Act, and is within the full scope of its authority to include exemptions.

"We have plenary authority over municipal affairs," Doyle said. "Because it has to do with public monies and public properties, these are matters truly within the powers of our city."

The plaintiffs argue that the city's position that the ordinance is generally consistent with the stipulations set forward by the California law is false, and the city violating the affordable-housing law in the state.

Aside from exemptions and deference to economic development inserted into the city's version of the law, the plaintiffs claim San Jose also adjusts the formulas in the state law, allowing affordable-housing developers to build properties geared toward those of moderate income or people making as much as $128,000 per year.

"The city policy therefore misclassifies as affordable a unit that would be too expensive for low-income families," the complaint says. "This will reduce the amount of housing that could be developed for truly low-income households in San Jose."

Currently, San Jose stands in need of more than 14,000 affordable-housing units, the complaint says.

The plaintiffs are represented by Christina Pena of Bay Area Legal Aid.

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