Agency: Cities evading affordable housing law: Surplus Land Act dictates how government agencies should sell property

Cities within San Mateo County are trying to evade the Surplus Land Act, which could provide thousands of affordable homes in the area to address the worsening housing crisis, according to the nonprofit Housing Leadership Council. 

The agency sent out an email to members and supporters last week that contends “our jurisdictions are ignoring the law.”

The act dictates that all public agencies including cities, counties, transit agencies, school districts and special tax districts must prioritize affordable housing when disposing of surplus land.

HLC’s Executive Director Evelyn Stivers noted the South San Francisco City Council’s action Thursday night to approve a 272-unit apartment complex downtown to be built on land formerly owned by the city’s redevelopment agency.

Stivers said the move is out of compliance with the Surplus Land Act because the city did not solicit interest from affordable housing developers and give the first right of refusal before the land was offered to market rate developers.

It’s another missed opportunity to build affordable housing and risky for the city because it opens it up to litigation, Stivers said.

South San Francisco City Manager Mike Futrell disputes Stivers’ claim, however.
Redevelopment agencies were the primary tools for cities to build affordable housing until the state dissolved them in 2011.

When RDAs were dissolved, cities formed successor agencies to wind down the former agency’s activities.
“Successor agencies” are not included in the language of the Surplus Land Act, Futrell said.
Successor agency property is not “surplus property,” he said.

Stivers said it’s a “creative” way to get around the law just as San Jose claims the law doesn’t apply to it because it is a “charter city.”

A project proposed for San Mateo County Transit District Land also skirts the Surplus Land Act since there is no requirement the project provide 15 percent of the units to be affordable to lower-income households, Stivers said.

The Bay Area Rapid Transit agency recently passed a requirement of all new developments to include affordable housing when the agency started receiving letters from lawyers on the Surplus Land Act in response to the recently approved Millbrae BART station development, Stivers said.

The act is important, she said, because rising rents are creating “tidal waves of displacement throughout the Bay Area.”

The current housing crisis has forced many workers in the county to commute long distances, which worsens traffic and makes it more difficult for businesses to attract and maintain qualified workers, she said.
The high cost of land in the county makes it a challenge to build affordable housing which highlights the importance of following the Surplus Land Act, she said.

Futrell said South San Francisco is committed to building more affordable housing.

“Please make no mistake, however — South San Francisco strongly supports affordable housing. We have nearly 1,000 affordable units in operation currently in the city, representing a city investment of over $34 million and have numerous new affordable housing projects underway. The lack of affordable housing in this one project is not a change in priorities,” Futrell wrote in an email about the just approved project.

bill@smdailyjournal.com
(650) 344-5200 ext. 102