‘What are we going to cut?’ Merced community at odds over city funding affordable housing
As Merced’s second and final Town Hall wrapped earlier this week, one message rang clear: the city is far from through debating its affordable housing policies.
Following calls to action from residents, one City Council member took a strong stance and stated that he wouldn’t support new development projects until the city makes a stronger commitment to promoting affordable housing.
Town Halls are scheduled annually at the start of the year for residents and city officials to discuss local needs. Compared to regular City Council meetings, Town Halls provide a more casual setting for elected officials to engage with constituents in preparation for planning the year’s goals and priorities, as well as the next fiscal year’s budget.
While common topics like public safety, city beautification, and infrastructure projects were noted at each Town Hall, affordable housing largely dominated the conversation — as it did during many debates at City Council meetings last year.
“Affordable housing has become probably the biggest issue in not just Merced but the state, quickly surpassing homelessness,” Merced Mayor Matt Serratto said at last week’s Town Hall. “We’re dealing with, in a lot of ways when it comes to housing, a historic moment right now,” he added Thursday.
Progress made in Merced not yet enough, some say
Like many parts of California, Merced’s low vacancy rate and rapid growth pose an ongoing problem for renters and low-income residents. State Auditor data also shows Merced’s severe cost-burden rating, overcrowding, and unavailability of units are all high.
Affordable housing units have costs fixed so that very-low to moderate income-level earners spend no more than 30% of wages on housing. No new affordable housing projects have been completed in Merced since 2014, but city officials say the Childs Avenue and B Street affordable housing project is near completion.
Frequent debates last year over housing culminated in a robust housing plan passed by the City Council in September. Plus, the council allocated $6.5 million in American Rescue Plan Act dollars to fund affordable housing.
City officials also told the Sun-Star that 2021 was “a good year for housing production in the City of Merced,” with City Council approving more than 675 new single-family residential units and 268 multifamily apartment units.
After the substantial amount of time spent on planning and policy changes last year, city officials have said the council this year will likely move forward from such discussions, rather focusing on implementing those new policies and approving more projects.
But some electeds and residents maintain that while the strides made last year were a good start, a start is all they are.
“We have to do something because affordable housing needs to happen, and it isn’t happening fast enough,” Councilmember Jesse Ornelas said Thursday.
Community split over affordable housing policies
At the center of the clash over affordable housing is whether the city should use its own local dollars to invest in building more homes. The city’s general fund, which pays for many essential city-provided services, does not include affordable housing. The question of whether it should has left the council split. Many residents who spoke at the Town Halls said it should.
Last year, proponents advocated for local money to go toward establishing an affordable housing trust fund. Renewed calls for such a trust fund were heard in force during the two Town Hall meetings.
Several community members called for $20 million in city dollars to be allocated. City Council members Ornelas, Fernando Echevarria, and Bertha Perez voiced their support Thursday.
Ornelas went as far as stating that he won’t vote in support of new development projects or zoning changes until the City Council commits to an affordable housing trust fund. “I encourage my colleagues up here to take the same type of stance,” he said.
The three council members rallying behind calls for an affordable housing trust fund tried to make it a reality last summer but were shot down with “no” votes by their fellow electeds.
Opponents have said using city funds for affordable housing isn’t appropriate, as it’s traditionally a job for the private market. Others noted that available city funds wouldn’t make a meaningful dent in covering the exorbitant cost of building affordable housing in California. Project costs far exceed typical activities budgeted by the city and are mostly funded by a complex system of state and federal tax credits granted to developers.
After a majority of council members voted against an affordable housing trust fund last summer, the city instead shifted to evaluating a housing consortium in partnership with the Merced County Association of Governments. Merced City Manager Stephanie Dietz said Thursday that the city has been working collaboratively with other cities in the county to build better housing strategies together.
Still, several residents on Thursday noted the persistent interest in a City of Merced affordable housing trust fund, even after it was rejected.
“It’s something that the people are asking for, it’s something the people are demanding, it’s something the people are gonna get, bottom line,” Echevarria echoed.
While not wholly against the idea of investing local dollars, Serratto begged the question Thursday of where $20 million in city funds would be taken from. The total general fund budget during the 2021-22 fiscal year came to $51.3 million.
“What are we going to cut?” Serratto asked. “The problem is, there’s so many things that are worthy of funding.”
Even trust fund proponents on the City Council noted that $20 million is a big ask. Whether that large of a number is feasible or not, Ornelas, Echevarria and Perez stated it’s important is to listen to the request and take it seriously as the city moves into this year’s strategic planning.
“This is what the citizens of Merced are asking for, and I think we should listen to them,” Perez said.
This story was originally published February 19, 2022 at 5:00 AM.
