OCEANSIDE — After hearing testimony from dozens of residents frustrated about the city’s lack of affordable housing, the City Council is moving forward with raising affordable housing inclusionary requirements for developers.
The city will maintain the current inclusionary housing requirement of 10% for single-family housing areas and bump it to 15% for all other types of housing, including multifamily and mixed-use.
The decision to raise the inclusionary rate from a flat 10% rate for all residential projects followed a discussion at a citywide housing workshop on Aug. 30. Residents packed City Hall and voiced their concerns about rising costs and lack of housing.
According to Leilani Hines, the city’s Housing and Neighborhood Services Director, a 3% vacancy rate is considered healthy, but the city’s current rate is only 1%. Hines said the city is currently in the midst of a “landlord’s market,” with a tighter rental market and higher housing costs.
Many community members are unable to afford increasing rents, jumping as high as an additional $1,000 per month for some residents, according to Mayor Esther Sanchez.
“We need to partner with affordable housing developers and stop the loss of affordable housing, or what we call workforce housing,” Sanchez said.
Raising the limits
During the housing workshop, the City Council acted on several staff recommendations, including raising the inclusionary housing set-aside requirement from 10% to 15%. As part of this move, staff also recommended an economic study to examine the feasibility of raising the current three-unit threshold for inclusionary housing to 10 units.
Staff did not suggest bifurcating the requirements — the council ultimately made the decision to split requirements between single-family homes (10%) and all other housing (15%).
Councilmember Eric Joyce originally proposed to raise the inclusionary housing requirement to 15% across the board but was met with hesitation from other councilmembers like Deputy Mayor Ryan Keim, who felt that 15% wouldn’t fit in all of Oceanside’s neighborhoods.
“We talk about all the things we can’t do because of the state, but this is the one thing we can do,” Joyce said, earning applause from the audience.
Keim said he wanted to do things “the right way” and noted some neighborhoods should have as high as 20% affordable housing.
“I’m not supporting a blanket 15%,” Keim said.
Nearly 40 members of the public spoke in support of raising the inclusionary housing set-aside requirement to 15% or higher.
One speaker noted it was “embarrassing” that Oceanside only required 10% since neighboring Carlsbad’s inclusionary housing rate is 15%.
The struggle to find housing
Many spoke of how they struggle to make ends meet to live here. Others pointed out how their children can’t afford to live in their own hometown.
“I have four children who grew up in Oceanside – none of them can afford to live here, and they all have good jobs,” said Daniel Dominguez. “What we’re doing now is not working.”
At the current rate, Dominguez said it will take 130 years for the city to meet its Regional Housing Needs Assessment requirements for very low-income households.
Cities across the region are required to meet certain state-required RHNA levels for housing based on population and income. Oceanside must build 5,443 new homes for the 2021-2029 Housing Element cycle.
The city is falling behind in meeting its low and very low-income needs.
“It is expected that 248 new income restricted homes would need to be constructed on an annual basis to meet the city’s RHNA for lower-income households, with a total of 1,986 housing units needed during the current…cycle,” the staff report states.
So far, the city has 24 development projects in the pipeline, with 75% rental, 25% for sale, and about 352 units for very low- and low-income households.
A ‘humane decision’
Jimmy Figueroa, a lifetime Oceanside resident and the executive director of Operation HOPE, a homeless shelter for single women and families with children in Vista, explained that more affordable housing is a way to prevent further homelessness in the region.
“In our region, there is a higher rate of families becoming homeless for the first time – higher than the amount of families finding housing,” he said. “It’s working families from our community with one or two jobs with children that attend our schools.”
While he supported the staff’s recommendation to raise the rate to 15%, Figueroa said it should be higher.
“Fifteen percent is not high enough,” Figueroa said. “It is a humane decision to make that number even higher.”
The outliers
While the vast majority of public speakers supported raising the inclusionary housing requirements, a few spoke against the move.
“Housing is not a right – someone else always has to pay for it,” said Richard Newton, who suggested taxpayers or laborers end up paying the difference for inclusionary housing. “If you advocate for affordable housing, you’re advocating for a form of slavery… no one has a right to live somewhere they can’t afford, including Oceanside.”
Newton explained that the market will “correct itself” as people move away, which he said will eventually lead to decreased housing costs.
Lori Holt-Pfeiler, president and CEO of the Business Industry Association of San Diego, also opposed raising the inclusionary housing requirements for developers, arguing the increase would be an additional cost to developers and another roadblock to more housing.
“These projects have to pencil out,” Holt-Pfeiler said. “If a project does not pencil out, it will not get built.”
The final decision
In addition to bumping the inclusionary housing rate to 15% for some housing, the City Council will explore prohibiting new short-term rental permits in single-family neighborhoods outside of the coastal zone, allowing ADUs as inclusionary units and density bonus units for single-family projects.
The city also plans to examine how other cities are protecting and helping renters.
The City Council also approved using assistance-gap funding to help pay for affordable housing projects, requiring 20% affordable housing for by-right projects and exploring underutilized city-owned land as potential affordable housing sites.
Staff is expected to come back with additional ordinances for the City Council and move to increase its inclusionary housing requirements “as soon as possible.”
