A new model for affordable housing is taking shape in Mountain View that would make it easier for low-income tenants to remain in the city.
In a 6-0 vote, the City Council supported a framework for a “community ownership action plan” to help local organizations buy and preserve older apartment buildings, providing stability for tenants at risk of displacement. Council member John McAlister was absent from the Sept. 9 meeting.
“We received feedback that the existing housing system does not meet the full needs of the community,” said Mathew Reed, the city’s housing officer.
Market-rate housing is out of reach for many people and affordable housing is not flexible enough, Reed told the council. A community ownership action plan, or COAP, would address these issues by taking land or housing units off the market, preserving housing affordability in perpetuity. It would also promote a shared governance structure and community stewardship, giving residents a greater say in how to meet their housing needs, Reed said.
He noted that there are two organizations actively looking to purchase apartment buildings for community ownership. One is the Mountain View Community Land Trust, a nonprofit founded by a group of Latina immigrant women who have long-served as community advocates. The group has been pursuing buying a building in the Castro neighborhood, an area of the city with a higher number of low-income households.
The community ownership action plan drew praise from council members who described it as a roadmap for a new type of affordable housing that could be sustained over time. But they also expressed concern about how to leverage funding for organizations looking to establish projects, preferring to implement flexible loans rather than handing out grants.
“This is a starting point for a framework, and it’s recognizing that we don’t have millions of dollars to grant today,” Council member Chris Clark said. “We’re trying to figure out where we put our resources in terms of how we structure this.”
Last year, the City Council set aside $4 million as part of a plan to try and attract an additional $16 million from external sources, for a total of $20 million, to preserve 50 rent-controlled units. Since then, the city has determined that the actual cost would be closer to $25 million, while at the same time it has not received additional funding beyond the original $4 million allocation.
Council members supported the staff recommendation to finance projects with loans, a proposition that several public commentators asked the council to reconsider, saying it would pose an undue hardship on organizations looking to put housing in the hands of the community.
“Carrying a debt from the start significantly limits their ability to fulfill their mission of serving those most in need,” said Paula Perez, a Mountain View Community Land Trust member, speaking in Spanish. “This burden will inevitably be passed on to the residents through higher rent payments affecting the very people we seek to protect.”
But City Council members expressed doubt that grants would offer an easier pathway to a community ownership project, noting that they also carry a lot of restrictions.
City staff sought to reassure the public that the loans would be more flexible than traditional affordable housing loans, allowing the city to respond to the unique needs of each project. The terms could be structured to charge very low or no interest, set up as deferred payments or as forgivable loans with no repayment, according to the council report.
“We believe the balanced approach of flexible loans and appropriate safeguards is the best approach for the city and provides a win-win option,” Reed said. “We have come a long way and believe that the COAP will potentially be the most flexible community ownership funding program in the state.”
Housing Director Wayne Chen also noted that loan repayments could fund future projects, an attractive proposition for the city since it is facing a $50 million shortfall to finance new affordable housing projects.
While the council favored the flexible loan option, they did not close the door on the possibility of establishing a grant program down the road, especially if the city’s coffers grow. They also backed a staff recommendation to provide a smaller technical assistance grant program for $75,000, which would provide support services, like real estate brokerage and legal assistance for organizations seeking to buy properties.
A final version of the community ownership action plan is expected to come before the City Council next year for approval.
