Developer hopes to evade San Carlos affordable housing rules 

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A request to waive an affordable-housing requirement for the Transit Village project in San Carlos has sparked a debate over the viability of such policies.

A city ordinance would require the developer, Legacy Partners, to designate 42 of 280 proposed housing units as below-market-rate housing or pay a $7.9 million impact fee, according to City Attorney Greg Rubens. In a letter, Legacy had asked the city to waive the below-market-rate requirement, or reduce it to 28 units.

Plans for the oft-revised Transit Village project include constructing the units on a 10.53-acre strip of land owned by SamTrans adjacent to the Caltrain tracks near downtown San Carlos. The development would also include offices, retail space and parking.

At a recent meeting, the San Carlos City Council voted unanimously to deny Legacy the waiver to eliminate the below-market-rate housing requirement and the $7.9 million in-lieu fee for the project.

The project is up for discussion with the Planning Commission, beginning next week, and will be revisited by city staff and the council in the coming months.

At present, the project does not include affordable units.

"Questions about the legitimacy of the ordinance — of the need for affordable housing — and the ability of the staff and council to represent the city's point of view need to be asked in public," said Mark Moulton of the Housing Leadership Council. "This is a very big business proposition."

The city wants to ensure some units are affordably priced so middle-income earners such as teachers and firefighters can afford to live in San Carlos, Mayor Bob Grassilli said.

"The whole concept is to get people living near where they work," he said.

The neighborhood group Greater East San Carlos, which has long opposed the project in its current form, said the attempt to skirt the affordable-housing requirements was a "brazen attempt by SamTrans and Legacy Partners to shirk their civic responsibilities."

SamTrans doesn't see it that way.

"We're just leasing the land, and after we selected Legacy Partners to develop the property, our involvement in the process is stopped," said Jayme Ackemann, a SamTrans spokeswoman. "We're not developers."

Jeff Byrd of Legacy Partners doesn't see it that way either. Byrd said his organization is committed to building some kind of affordable housing, but the city's ordinance, in its current form, makes doing so at the Transit Village site impossible due to financial considerations.

"We'd like to do something in the way of affordable housing, but not what the ordinance says," Byrd said.

Asking developers to make affordable housing commitments prior to an approved project plan is highly unusual in the Bay Area, Byrd maintained.

"We need to get the project approved at this point, and then we can discuss affordable housing," he said.

Grassilli said city officials hope that Legacy will continue to work with them to meet the requirements, and that there's a "reasonable compromise" all parties can reach.

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