In another sign of the city of Sacramento's desire to reverse its anti-business reputation, officials are exploring changes to a low-income housing ordinance that would allow developers to pay fees in lieu of constructing a required percentage of affordable housing in new projects.
Affordable housing advocates argue that the fees being discussed are too low and that the changes will result in a dearth of low-income housing for a city where hundreds of people sleep on the streets each night.
Roughly 50 of those advocates marched to City Hall from Trinity Cathedral in midtown Tuesday afternoon to urge the City Council to keep its current regulations. Most of the more than 30 residents who testified on the issue were opposed to the changes being explored.
The City Council discussed the changes Tuesday night but will not vote on a revamped ordinance until early next year.
Those changes could allow developers to pay fees based on the size of projects instead of setting aside 15 percent of new housing developments for low-income residents. The fees would go into the city's Housing Trust Fund, which is used to help finance affordable housing projects.
A city staff report described the current ordinance as "inflexible" and said the rules have led developers to construct massive affordable housing projects next to single-family homes a trend seen frequently in North Natomas.
City officials said the fees would also give the city an important financing tool for affordable housing projects following the elimination of redevelopment subsidies.
Officials will explore the changes in the coming months before seeking City Council approval in January at the earliest. City staff pledged a series of meetings with interest groups before a plan is crafted.
"We have a balancing act here to do," said Councilman Steve Hansen.
The council did vote Tuesday to apply whatever low-income ordinance is adopted to the entire city and also made other changes to the housing element of the city's general plan, which guides policies to address housing needs over the next eight years.
Affordable housing regulations had only applied to North Natomas, parts of northern Sacramento north of Interstate 80, the Curtis Park and downtown railyard sites, and the planned Delta Shores development in south Sacramento.
The charge to ease requirements on low-income housing is part of a broader push at City Hall to improve the business climate in the city.
Sacramento is regularly ranked among the worst cities in the country to start and operate a business. While city officials scoff at the rankings, they acknowledge that the perceptions resulting from the lists compiled by publications such as Forbes do have an effect on the city's reputation.
City officials began attempting to reverse those perceptions earlier this year, when the council voted to update its decades-old zoning code. The revamped code did away with layers of review and fees that had been required for new projects and erased the much-maligned "council call-up" power, which had allowed council members to demand full City Council hearings on any project, no matter how small.
Last month, the council voted to ease restrictions on "big-box" superstore chains such as Wal-Mart and Target, despite the objections of organized labor and some small-business groups.
Now, with changes on the table for low-income housing development, housing advocates, faith leaders and homeless rights activists worry the city is turning its back on its poorest residents.
"If they follow through on this, the city is planning a road map for leaving (low-income residents) behind," said Greg Sparks, the interim executive director of the Sacramento Housing Alliance.
Sparks was joined by homeless advocates and members of Sacramento Area Congregations Together in a 20-block march to City Hall.
The group called the event a "pilgrimage to City Hall." Some protesters held signs that read, "A car is not a home" and others wore T-shirts reading, "Sacramento, A city that houses everyone?"
"We want the council to know we are a bunch of passionate people," said Sally Smith, a parishioner of Trinity Cathedral and a leader of ACT. "This city needs a tool to house extremely low-income people."
The council voted Tuesday to make some changes to its housing policy that were not seen as controversial, including deferring development fees collected for affordable housing until projects are complete, not when permits are first issued.
The council also enacted a responsible banking ordinance that will require financial institutions that receive city funding for housing projects to show responsible lending practices and make investments in the community.
The housing element will be passed to state housing officials for their review.
Housing advocates said they are worried that affordable housing support is dwindling in the region as other cities and counties discuss changes to low-income housing requirements.
In addition to Sacramento, much of that concern is aimed at Sacramento County the largest jurisdiction in the region. The county is reviewing its affordable housing ordinance, but no formal recommendations have yet been made, said Leighann Moffitt, the county's planning director.
In Davis, the City Council approved changes in July that did away with a requirement that projects include 25 percent affordable housing. The regulations were replaced by a tiered system that bases the affordable housing requirements on lot size, beginning with a 10 percent obligation for projects with small lots.
Developers can also pay fees to replace up to half of the affordable housing they are required to build in new projects, said Mike Webb, the city's director of community development and sustainability.