All affordable housing projects in San Jose would be halted for the next five years if San Jose’s Redevelopment Agency (RDA) enacts their proposal to use $75 million from its Affordable Housing fund in order to meet the State of California’s requirement that the agency give the state an interest free loan of $75 million.
This proposal by the RDA has a direct impact on nonprofit housing developers, including Charities Housing, and their ability to survive in the near future.
“To completely gut the one program that helps the poor is outrageous,” said Greg Kepferle, CEO of Catholic Charities of Santa Clara County and Board President of Charities Housing. “From a moral perspective it goes against the principle that the poor and vulnerable need to be protected first.”
The RDA’s proposal would pull the rug out from underneath the Destination: Home goal to end homelessness and Step Up Silicon Valley’s campaign to cut poverty (The City of San Jose is an official partner and endorser of both Destination: Home and Step Up Silicon Valley).
“We are asking that the RDA stop and consider other alternatives, such as a fair distribution of the cuts, or looking at lower priority development areas to cut first, or other creative solutions,” said Kepferle.
There are a number of savings the RDA can make by deferring lower priority projects out several years. We recognize that the RDA has already made substantial cuts and that more may be needed, but to completely gut the one program that helps the poor is outrageous.
Solutions and alternatives:
1. Affordable housing receives 20% of tax increment revenues, so should contribute 20% of debt, $15 million.
2. Delete $2 million in RDA capital expenditure and indirect for next two years. Capital budget has decreased by 67% but operations related to it only 20%.
3. Defer $10 million from “encumbered” projects of lowest priority.
4. Defer $10 million from lowest priority capital projects for next three years, that is 10% of these projects.
These will get RDA closer to dealing with the state without completely forcing the poor residents of the city to bear the entire burden.