So. Last weekend, relieved that the elections are finally over, I spent a bunch of time catching up on meetings I hadn’t had time to watch during campaign season and trying to decide what I should write about this week.
One of the things that always surprises me about watching City meetings is what issues catch my attention. I mean, you look at agendas, and you would think it would be obvious what is going to be interesting to write about. Take, for example, tonight’s Council meeting. There are several controversial topics on tonight’s agenda — criteria for awarding the marijuana growing permits, doubling the number of dispensary permits in Oakland, and municipal ID cards.
319 Chester Street
But watching the Committee discussions from two weeks ago, those weren’t the things that I found I had the most to say about. Instead, my attention was grabbed by the conversation about a little vacant lot in West Oakland, at 319 Chester Street, which is on tonight’s consent calendar.
For the whole story, you can read the staff report (PDF), and watch the video of the whole discussion below.
Basically, the City owns this vacant lot near West Oakland BART. The want to give it — well, “sell” it for no cost to a company called the Alliance For West Oakland Development, who will then use City affordable housing funds to build a house on it, which they will then sell to an affordable housing buyer, and then give the money from the sale back to the City so that it can be used to fund more affordable housing construction. Additionally, there is a job training for youth aspect to the construction. From the the staff report (PDF):
The Alliance for West Oakland Development, Inc. is a 501(c)3 community development corporation, established in June, 1999. They were formed to address the issues of rebuilding the West Oakland community. Their mission is to initiate, promote and facilitate the development of blighted areas of West Oakland through a Green Building and Construction Training Program. The program provides training opportunities for West Oakland residents and is geared toward “at risk” young adults (18-25 years) and is also open to all persons interested in entering the construction field.
So this sounds like a good thing, right?
At the Community and Economic Development Committee
So when this item came up at Committee, District 5 Councilmember Ignacio De La Fuente is all “Um, so how does this make any sense when people can just buy houses for a fraction of that cost? Why don’t we just sell the damn lot?”
So staff responded that if we sold it, we wouldn’t have any guarantee that anyone would build on the lot, and also that the construction presents job training opportunities.
Now, I’m very sympathetic to the idea of doing it for the job training. But I found it very odd that there was like, no information about the specifics of this job training component in either the report or the presentation. I mean, if you’re going to invest all this money and the primary benefit is that it’s a job training program, wouldn’t you think there should be some more details about that program? Like, I don’t know, how many people it’s going to train? Even just a rough estimate? How people qualify to be part of it? Anything at all? It just seemed off to me.
So then, Igancio De La Fuente asked again about the cost. And staff was like “Well, we don’t actually know that it’s going to cost $375,000. Maybe it will cost less. And also, maybe property values in West Oakland will increase dramatically by the time we finish building this. So then it won’t be more expensive that everything else around.”
So then, Council President Jane Brunner is like “Okay. So we’re giving them $375,000 to build this place, plus $100,000 worth of land. So we’re talking about a $475,000 investment from the City?” And staff is like “Well, we’re going to sell it for at least as much as it costs us.” And Jane Brunner is like “You’re going to sell it for $475,000?” And staff is like “Well, we don’t know what we’re going to sell it for. If we sell it for $475,000, then yes, but if we don’t, then no.” And Jane Brunner is like “So you’re not going to sell it for as much as it costs us?” And staff is like “Yeah, sure. We’ll sell it for $475,000.” And Jane Brunner is like “Well, okay. That’s cool with me as long as all that money comes back to the City.”
So I don’t know if I’m just missing something entirely or what. But how is this house affordable if we’re going to sell it for nearly half a million dollars? I mean, nobody brought this up at the meeting, but it was the biggest question in my head when I was reading the staff report, which suggested that it was only going to be sold for $375,000. I mean, yes. I get that if we sell it to someone of a qualifying income level, then it technically qualifies as an affordable housing sale. But from a practical perspective, when you’re thinking about the actual goals of affordable housing production — well, I just don’t see how this fits with them.
So then District 2 Councilmember Pat Kernighan started asking about who is going to buy the house (participants in Oakland’s first-time homebuyer program) and what kind of affordability restrictions (45 years) there would be on it, and then was just like “Wait, how does this make sense? We’re going to sell this house for $475,000? Really?” And staff is like, “No, we’ll sell it for $375,000. Or however much it costs to build. Maybe it will cost $250,000. Who knows? The land is free!” And Pat Kernighan is all “But the land is worth money. And people don’t want to buy houses with resale restrictions when they can buy houses without them for cheaper. I do like the job training thing.”
And then staff was like “Yes! That’s why we’re doing it. Not for the money, for the job training. Also, it will revitalize the neighborhood.”
And then District 7 Councilmember Larry Reid was like “We’re going to do one of these in my District, too! It’s gonna be awesome!.” And then the Committee all voted for it except for Ignacio De La Fuente and now it’s on the consent calendar for tonight’s meeting.
Details seem to fall short
There are a lot of things about this that seem very admirable in concept. Affordable housing. Job training. Making productive use of vacant city-owned land. But you need more than a good concept. And the details on this thing — I just don’t see how they pencil out.
I mean, if we’re talking about selling a single-family home for almost $400,000, that doesn’t seem like a good affordable housing investment. Nor does it seem realistic to me in a neighborhood where comps are generally less than $300,000.
With no details on how many people we can even expect to be part of the job training, and what exactly they’re going to get out of it, I don’t see how we can evaluate if this is a good use of money for that purpose.
And of course, there’s the issue of money. The City is broke. We need money to provide services. So it seems like before we just go around giving property away, we should at least look into seeing whether we can sell it to someone who just wants to build a normal house on it, and maybe if we can get some much needed cash. Right?
It bothered me that the Committee was so cavalier about approving the whole thing. I mean, I guess they saw it differently, but when I was listening to the questions they were all asking, it really didn’t seem like they were getting very good answers from staff. There’s a tendency, on the part of the City Council, to act like if money isn’t coming from the General Fund, then we don’t have to think very much about spending it. But that’s a terrible way to approach running the City! And I can’t help but think that this attitude has a lot to do with the reason we’ve ended up in such a sucky situation with the budget.