Mountain View Voice

Opinion - June 22, 2012

Good investment in affordable housing

After more than four years of tangling with the owner of a substandard building at the corner of Rengstorff Avenue and Old Middlefield Road, the city finally appears headed to a solution that will redevelop the property and create 51 studio units of affordable housing over a small retail space and a parking garage.

The City Council was firmly on board last week when members voted 6-0 to proceed with plans that will displace 48 low-income residents and two popular taquerias at the site, which has been a nightmare for city code enforcement officers for years. The 1946-era structure was built two years before the city implemented its first building code in 1948, and it has become one of the city's most prominent code violators.

In fact, council members noted that in part their support for the project relates to the amount of time spent at the building by code enforcement officers and staff members from the city attorney's office. The project's $9.3 million cost will come in part from grants and the BMR housing fund and be built by ROEM and Eden Housing, the same company that will build a 51-unit affordable housing project at Evelyn Avenue and Franklin Street.

Council member Tom Means, who often finds fault with the city taking away free enterprise opportunities, was firmly behind this project.

"We've got to fix it, and to me the easiest way to fix it is to go to another project that is compliant. My feeling is we just move ahead and get this to be a better site. It gets rid of a headache to some extent."

As the costs for owner-occupied housing and rentals continue to climb, it makes sense for the city to provide an opportunity for 51 additional units of affordable housing,which is becoming more and more difficult to find here. The studio-size apartments would be rented to those making up to $32,625 a year, with rents ranging from $521 to $793 a month. Two people could occupy one unit, although city staff members estimate that only six of the 51 units would be occupied by two tenants, which is comparable to the mix at similar projects.

One eye-opening part of the city's costs in this project is the $744,000 that will be set aside to cover relocating the 48 tenants and five businesses who occupy the property. Residents of the old building will be eligible for a generous relocation allowance, which according to state law includes "persons displaced from their homes, businesses or farms as a result of the actions of a public entity."

In this case, tenants are entitled to moving expenses, relocation advisory services, "decent, safe and sanitary" replacement housing, and a "rental differential payment," which makes up a large part of relocation costs. According to city officials, depending on their situation, some tenants moving out could be entitled to more than $40,000 in rent differential payments alone. For example, if a tenant is leaving a $900-a-month apartment for a unit costing $2,000 a month, the differential would be $1,100 a month multiplied by 42 months, or $46,200 over the three and one-half years.

Specific examples are not available for business relocation expenses, but could be substantial after adding up the costs to install signs, paint and carpeting and numerous other improvements typical when relocating a business. The good news is that it may be possible for two of the smaller businesses to return to the new complex, which will have about 2,800 square feet of commercial space.

Given its options, the city made the correct decision to move ahead with this project, which not only will provide badly-needed affordable housing, but also will replace a building that has had a difficult time meeting the city's health and safety codes. And, it will be putting the city's BMR housing funds to good use.

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