(LIVERMORE, CA) - A housing development that initially promised 51 affordable homes is now slashing 25 of them and turning them into Market Rate homes, city officials confirmed.
Photo Credit: City of Livermore / YouTube
The decision to do this came from increased difficulty selling moderate-income for-sale homes. “Moderate Income units are the majority of the for-sale opportunities offered in the city’s affordable home ownership program, but they have become increasingly difficult to sell”, Assistant Planner Emily LaDue said during Livermore's Jun. 8 City Council meeting.
The original plan, approved in 2022, was to include 24 moderate-income homes for Shea Aura and for Shea Serenity to construct 13. LaDue mentioned that factors contributing to a lack of buyers stem from the current high demand for one- and two-bedroom apartments versus the three-bedroom homes that had been built.
A combination of high interest rates, HOA fees, and home insurance discouraged qualified buyers who were interested at first upon seeing the cheaper sticker price of the homes.
This outcome has left developers to cut the 24 affordable homes at Shea Aura by 16, leaving only 8; and likewise with Shea Serenity, shrinking from 13 to 4.
Photo Credit: City of Livermore / YouTube
Alongside this, LaDue stated, “To maintain the concessions and waivers the projects were granted under state density bonus law, the project must maintain a minimum of 10% overall units as affordable provided onsite.”
The State Density Bonus referred to is when the state allows developers to exceed City zoning laws to approve project density increases to developments that include a percentage of affordable or senior homes.
Alongside the moderate-income units, it is worth noting that Shea Aura and Shea Serenity maintain median-income units as well, with 9 belonging to Aura and 5 to Serenity, respectively. “ Requested results would not result in any physical changes to the project," LaDue also said.
The brick-and-mortar homes would remain, but they would transition to market price, and, in exchange for this, developers have opted to pay in-lieu fees. These fees would transition the units to a currency that can be used for other projects across Livermore.
Photo Credit: City of Livermore / YouTube
We are converting units to dollars so that we can build total things separately,” Councilman Steven Dunbar remarked.
What was dubbed as Alternative Compliance by developers would allow the City to allocate the in-lieu fees for other necessary low-income and special needs housing projects, such as the Avance Housing and Pacific Avenue Senior Apartments.
Assistant City Manager Paul Spence assured Mayor John Marchand that for every unit lost at Shea, two more can be acquired for the Pacific Senior Homes based on the in-lieu fees acquired. These changes were met with opposition from the public.
“The developer agreed to these conditions and should be held to their agreement,” Livermore resident Jane King said. She urged the Council to reconsider, as she noted that more affordable housing is needed, and by approving the amendment, it would only reduce affordable homes for people who need them.
She continued, “The City should not set a precedent of changing agreements because of changing financial markets.”
Closing remarks by City Councilmember Evan Branning empathized with the public and the need for affordable housing.
Photo Credit: City of Livermore / YouTube
“Again, don’t think this is a precedent. I don’t want it to be. I don’t want this to happen in the future. I don’t want us to go for in-lieu fees regularly," Councilmember Evan Branning stated. He noted that though he was at first strongly opposed to the proposition, he leaned in favor of it specifically because their in-lieu fees are low and are very much needed.
Branning also wanted to make clear that the Council does not support developers taking advantage of Bonus Density laws.
“I also want to make clear that I don't want to stand up in situations where developers use density bonuses to set up situations in the future when they come back and say, ‘Well we’ve designed this project that won't sell’,” Branning said.
After much deliberation, the Council voted unanimously 5-0 for approval.
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