For the latest of our quick posts checking in on big issues we’ve written about, I took a quick look at the sticky issue of affordable housing costs.
I wrote a big, and controversial story on affordable housing construction last year. The main takeaway: Government-subsidized affordable housing often costs far more to build than market-rate housing.
The story looked at some of the factors leading to the higher costs, from a requirement to pay workers a prevailing wage, to the pressure on developers to incorporate cutting-edge designs and to build on scraps of land that commercial developers have already passed over.
A few weeks after the story ran, the state body that hands out public subsidies to build affordable housing pledged to study the spiraling costs. That was last September.
So where are we at now? Let’s check up.
Where we left it
I last checked up on this issue in April. At that point, the four state agencies involved in the effort to study the increasing costs hadn’t yet chosen a company to conduct the study.
There were various reasons why the study hadn’t started yet, some of them bureaucratic and some born from the desire to make the process as inclusive as possible.
Colin Parent, director of external affairs for the Department of Housing and Community Development, assured me at the time that a company would be chosen to complete the study soon.
What’s happened since?
After a detailed selection process, the state agencies chose Sacramento-based Blue Sky Consulting Group to complete the study.
Matt Newman, Blue Sky’s principal and co-founder, told me his team has almost finished gathering all the data it needs on affordable housing projects. They are now getting started on acquiring comparable data on private, market-rate projects.
The main purpose of the study is to ascertain why costs are increasing on the public side, Newman said. But his firm is also examining whether other factors, like building larger projects, could lead to cost-savings.
“We want to know if there are economies of scale. If you only look at like projects, you won’t see that,” Newman said.
Newman said the study will look at most of the affordable housing projects built in California in the last decade.
What happens next?
Parent said he expects to see preliminary data from the Blue Sky study by late January.
Newman called that “optimistic.” He said the data would more likely be released in early spring.
Parent said once the results are out, the four state agencies that commissioned the study hope to have a series of public forums to discuss the findings.
What happens after that depends on what Newman and his team find, Parent said.
“We anticipate that this will illuminate a lot about this process, but we don’t know yet what it will show,” Parent said. “We’ll be identifying the cost drivers and it’s going to be a subsequent decision to see if those are justified.”
Will Carless is an investigative reporter at Voice of San Diego currently focused on local education. You can reach him at will.carless@voiceofsandiego.org or 619.550.5670.
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