A new coalition to address housing affordability has launched an ambitious effort to build and maintain up to 175,000 households over the next five years in the increasingly expensive Bay Area. the Partnership for the future of the bay is aiming to raise $ 500 million from leading donors, including the San Francisco Foundation, the Chan Zuckerberg Initiative, the Ford Foundation, and private partners, including Facebook and Genentech.
Announced earlier today at the San Francisco Commonwealth Club, the coalition – which will focus on the counties of San Francisco, Santa Clara, San Mateo, Alameda and Contra Costa – is the latest announcement aimed at channeling private investment towards affordable housing. Last week, Microsoft announced a $ 500 million investment in the Seattle area, creating a Trust fund of $ 475 million support the creation of middle-income housing and a $ 25 million donation to address homelessness.
This new activity in the Seattle Bay Area and in Seattle shows that businesses are playing a more visible role at a time when affordability is becoming an increasingly pressing political issue and where the role of business is increasing. technological industry in the reduction of housing costs has been examined very closely.
"Talk to anyone in the world of non-profit housing, and they will say that having the kind of capital that Microsoft offers is extremely important."
This new funding meets a crying need. According to the National Low Income Housing Coalition, out of 35 low-income renters, only 35 were affordable and available. This is a shortage of 7.2 million units throughout the country. The question prompted Democratic presidential candidates, such as US Senators Elizabeth Warren and Kamala Harris, to housing policies central boards in their campaigns.
But in the long run, advocates question whether the private sector should have as much power over housing policy – and whether these investments are more concerned with providing the working population with more and more interests than purely charitable efforts. for the whole community.
Capital contribution to counteract the affordable housing crisis
Some housing advocates see these promises not only as important sources of capital, but as precedent-setting investments that will encourage greater corporate action.
"This New York Times story Microsoft's investment indicates that we can not let the government move away from affordable housing, "said Randy Shaw, director of the Tenderloin Housing Clinic Clinic in San Francisco, and author of Generation at a reduced price. "But the reality is that the government has been away from the last 40 years. Talk to anyone in the world of nonprofit housing, and they will say that having the kind of capital that Microsoft offers is extremely important. "
Currently, the federal government provides housing finance. a third of what was in the 1970s, corrected for inflation, cited in New York Times, and the Tax invoice 2017 has decreased the value of low income tax credit, an essential source of funding for affordable housing construction. Combine aid cuts with rising construction and land costs, and it's getting harder and harder build affordable housing.
The technology sector has long been viewed as a major factor in rising housing costs in the San Francisco Bay Area and beyond. Amazon new HQ2 slots in New York and Virginia have fueled fears of a dramatic increase in rents. These new investments may be a belated achievement by some of the world's richest companies to become involved in solving the problem they have exacerbated.
"Their commitment to housing sets an influential precedent and I am confident that this will change the conversation in other important employers," said Bill Rumpf, president of Mercy Housing Northwest, the Seattle-area chapter of the city's National Association of Affordable Housing.
A changing concept of corporate responsibility?
According to Shaw, the recent series of commitments made by companies in the Washington Bay area comes after decades of demands. Since at least the 1980s, San Francisco has been seeking donations from private companies to help address the twin challenges of homelessness and affordable housing.
"It's great that these questions are asked," says Shaw. "I really regret that in the late '90s, during the first boom of the Internet, there had been no pressure for these companies to support more housing."
The answer to homelessness is to have more homes and more services. Prop C will bring in $ 300 million a year from some of the most important businesses in the city like mine. Waiting for the financial flow to begin @LondonBreed and I finance the Bristol Hotel in partnership with @THClinicSF for $ 6.1 million. pic.twitter.com/eXiwM6FdmE
– Marc Benioff (@Benioff) November 29, 2018
According to Shaw, the recent turning point has been Salesforce's CEO, Marc Benioff, and his frankness responsibility for technology to tackle the problem of inequality. In addition to supporting the campaign for Proposal C, a recently imposed San Francisco tax that levied corporate taxes to pay for homeless urban services, it also paid $ 6 million directly to Shaw's Tenderloin Housing Clinic to help them rehabilitate a hotel to serve as transitional housing.
Will more technology companies take responsibility for affordability?
Efforts such as Microsoft's commitment primarily provide capital for affordable housing projects and are more specifically classified in investments. The company answered the question of why it just did not give the $ 500 million, Argue that the loan agreement allows them to continue to reinvest the funds in other projects. The computer giant based in Washington is also expansion of its seat in the Seattle area, adding 8,000 employees who will need places to live. Commitment strengthens the progressive skills of the company as a point of sale for recruitment.
Be that as it may, Rumpf thinks it's a good way for businesses to leverage their wealth to fill an important gap in the affordable housing ecosystem while preserving and creating housing that public programs current can not touch.
"Most housing advocates, including myself, want public sources to serve the poorest households," he said. "Microsoft can help the middle-to-middle income group find themselves stuck in our market."
"Most housing advocates (…) want to see public sources serve the poorest households."
Shaw believes that both initiatives are desirable initiatives and that they are encouraging more large companies to meet similar commitments.
"It's just a loan, but the $ 500 million capital flow is a big deal," says Shaw. "California Governor Newsom says he wants raise $ 500 million for housing. I think it will help to do it. "
According to Shaw and Rumpf, it will be more difficult for other companies to say they do not make this type of investment.
"Apple has just announced that it was adding 10,000 jobs in Austin, a market where technicians move low-income families, "he says. "Are we going to ask Apple to do this type of investment?"