CC 05-19-2020 Item No. 24 Below Market Rate Housing Mitigation_Written CommunicationsCC 05-19-20
Item #24
BMR Housing
Program Update
Written Comments
1
Cyrah Caburian
From:Myron Crawford <Mcrawford@bergvc.com>
Sent:Thursday, May 14, 2020 11:09 PM
To:Steven Scharf; Liang Chao; Rod Sinks; Darcy Paul; Jon Robert Willey; City Clerk
Cc:kevinm@leewardfinancial.com; Erick Serrano
Subject:Do Not Raise BMR % Requirements Nor In Lieu Fees
Attachments:CCUP Mayor 30 BMR% n Fees.pdf
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BERG & BERG ENTERPRISES, INC.
10050 Bandley Drive
Cupertino, CA 95014-2188
Ph (408) 725-0700 Fax 408-703-2035
mcrawford@bergvc.com
5/14/20
Mayor & Council Members
City of Cupertino
10300 Torre Avenue
Cupertino, CA 95014
Ph 408-777-3308 3251 Fax 408-777-3333
sscharf@cupertino.org;
liangchao@cupertino.org;rsinks@cupertino.org;dpaul@cupertino.org;
jwilley@cupertino.org;
cityclerk@cupertino.org
kevinm@leewardfinancial.com
Dear Council Members & Mayor,
Reference: Council Agenda 5/19/19
Item Item 24 – BMR Requirements and Fees
Subject: Do Not Raise BMR % Requirements Nor In Lieu Fees
1) This is not the time to be raising any fees!!! The financial impacts of the
Covid 19 pandemic are not fully understood but it is known that the
pandemic will increase costs and decrease revenue for governments and
business alike, it is already happening:
a. Governments are losing revenue and will seek to try to recapture that
revenue from business with the result of increasing fees and driving up
housing costs.
b. Governments may be forced to reduce staff and services increasing
development processing times thereby increasing the costs of housing
acerbating the housing affordability problem.
2
2) Inclusionary housing requirements raise the cost of new housing and all
existing housing stock.
a. Developers add the revenue loss between the Maximum sales price of a
BMR unit and the market rate onto the market rate units.
b. When the newly built units go on the market those sales costs are
immediately ceased upon by appraisers and appraisal services as “sales
comps” and that has a ripple affect on all, all, all, all existing properties
on the market and future listings thereby increasing housing costs.
c. You can’t make housing more affordable by making it more expensive and
what you are proposing to do is to make housing more expensive with
increased BMR requirements and in lieu fees!!
d. You are creating a “housing lottery” whereby the lucky housing lottery
winner is allocated the opportunity to buy a $1,500,000 windfall housing
unit for $500,000+-. So a very few benefit from the lottery, whereas that
windfall could have been invested in providing subsidies for really basic
living units for many other lower income individuals for a temporary
solution to their housing issues. The governments should be helping by
providing a “leg up” opportunity for many needy not a lifetime housing
lottery win for just a few individuals.
Your consultants should be required to have a section in their report describing
how all of these proposed fees impact the price of the existing housing stock
and future housing cost.
Thank you for your consideration,
Myron Crawford
Cc: