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What are the guaranteed parts of the Village Farms project?

Looking at Affordable Housing in particular

By Roberta Millstein

With the for and against ballot arguments for Village Farms and their rebuttals posted to the County’s website (as Measure V), and the campaigns starting to ramp up, I thought it was important to highlight what are technically known as the projects Baseline Features. These are available as part of the “Full Text of Measure V” on the County’s website, and I encourage Davisites to take a close look at them, but I wanted to point out a couple of things first.

Most important to note is what it means to be a Baseline Feature. As the text of the Measure itself clarifies:

Beyond the Baseline Project Features there are other additional requirements for the Project, including but not limited to, the mitigation measures set forth in the Village Farms EIR, and the Development Agreement that, while important to the Project, are not Baseline Project Features and may be modified with the approval of the City after the appropriate public process (emphasis added).

Another way of saying this is to point out that only the Baseline Features are guaranteed parts of the project. Anything else can be changed with a vote of the City Council — and here one should keep in mind that membership of that future City Council could be somewhat or even substantially different from today’s City Council. Thus, anything that is not a Baseline Feature is not a guaranteed part of the project.

And even then, it’s important to read the Baseline Features carefully, as some of us learned when Bretton Woods was able to jettison its promised memory care facility. Let me give an example that is tied to one touted feature of the project that is of great interest to many voters: Affordable Housing.

The rebuttal to the argument against Measure V states that the project will have “360 units serving very low to moderate income households.” But is this true?

Quoting from the Baseline Features in the “Affordable Housing” section:

Village Farms Davis will provide land and capital toward the construction of up to 360 Deed-Restricted Affordable Housing units, approximately 20% of total residential units. This provision exceeds the City requirement.

The Developer will donate a minimum of $6 million in phases toward the construction of affordable units.

The project shall guarantee that construction of at least 100 lower income Deed-Restricted Affordable Housing units is commenced prior to or concurrent with the delivery of the 150th market-rate unit in the Residential-Low-Density district, as set forth in the Development Agreement. 

So, already we learn that there will be “up to” 360 units of Affordable Housing, not that there will necessarily be 360 units, and that “land and capital” will go toward those 360 units. With respect to capital, I see that “a minimum of $6 million” is specified, but I don’t see where in the Baseline Features the amount of land is specified.

We further learn that only 100 units of Affordable Housing is guaranteed, and then only after 150 of the higher-priced units in the “Residential-Low-Density district” have been built. And then we are referred to the Development Agreement. Here is what the Development Agreement has to say about Affordable Housing:

Notwithstanding the above, if the City determines that construction of the 100 lower income units is infeasible for any reason, City may elect to request Developer to construct the units.

As David Thompson noted in an earlier post, this sentence is confusing (I would add “at best”). He asked:

  • So, if the City decides not to ask the developer to do them, then in essence those 100 units will not be built at all?
  • Why would the City seemingly sign a contract that allows these zero results for 100 units of affordable housing?
  • Would not the City wish to have language that if the City has found the 100-unit project infeasible that it requires the developer to develop the 100 units?

It sure reads to me as though the 100 units of Affordable Housing — much less 360 units — might not get built at all.

Davisites may still wish to vote “yes” on Measure V, but they should at least know what they are voting for.

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Comments

7 responses to “What are the guaranteed parts of the Village Farms project?”

  1. Jay

    I don’t know how the affordable housing program works, but a $6,000,000 “donation” towards 360 homes works out to $16,667 contribution per home. Seems like a pittance when even “affordable“ homes will be likely selling for what, 20 or 30 times that? I wonder if it is even a 5% contribution, even when considering the value of the land, which was purchased closer to ag land prices than residential land prices. I put “donation” in quotes because the developer will just tack the $6,000,000 onto the price of the remaining homes that are not categorized as affordable. Then I guess he gets a tax write-off on top of that.

  2. Tuvia ben Olam

    Thanks! As always, I am mostly-focused on transportation issues, but before I get into that, I want to clarify one thing: the referenced baseline features on the City website are absolutely what’s going to be voted on? There will be no modifications at this point, before the vote?

    1. I’m not sure what’s on the City’s website, but what is up on the County’s website is absolutely what we will vote on — there will be no further changes before the vote. Here’s the link:

      https://ace.yolocounty.gov/417/Measure-V—City-of-Davis

      Click on FULL TEXT OF MEASURE V and scroll down.

  3. George Galamba

    “Notwithstanding the above, if the City determines that construction of the 100 lower income units is infeasible for any reason, City may elect to request Developer to construct the units.”
    I’m confused. Is “City may elect to request Developer to construct the units” the same as “City will require Developer to construct the units”? If building the units is dependent of the generosity of the developer…
    Second, I’m not great at math, but 6,000,000/10,000 is $62,000. What kind of house can you build for $60k?

    1. George, your excellent point gets even more powerful when you know that the $6 million will pay for the employee salaries, and application costs for the City’s efforts to get the full financing to build the 100 homes. If/when the city determines their efforts are “infeasible” they don’t return the full $6 million to the developer, but only what is left of the $6 million after paying their employees and covering the costs of their unsuccessful and aborted efforts. The $6 million is not likely to be more than $2 million at that point.

  4. Alan Pryor

    The 16 acre land donation and $6 million contribution to the City of Davis Housing Trust Fund was what the City demanded from the developer claiming it is the most likely path to actually getting the low income housing units built. This type of public:private partnership generally involves a land donation to a non-profit low-income housing developer which provides a combination of low income housing tax credits to entice private investment. Additional public grants and financial contributions by the local low-income housing agency are generally also necessary to bring the projects to fruition. It was for this reason that the City demanded the additional $6 million contribution from the developer.

    This is the same financial/development model used to develop the River Grove Apartments in West Sacramento which broke ground in January as well as a number of recently approved or built low-income housing projects being developed in Woodland – including the 100-unit development on Ventura Blvd and the recently announced 73-unit Tupelo Apartments on Lemon Ave.

  5. […] thanks for recently highlighting this huge legal loophole in the official language citizens will be voting on in Village Farms June […]

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