Stanford University's main campus sits right on the border of San Mateo County, between Menlo Park and Palo Alto. The university is seeking to add 2.27 million square feet of academic space and 3,150 housing units or dorm rooms to its roughly 4,000-acre campus in a general use permit application set to run through 2035.
At a May 1 hearing, the Santa Clara County Board of Supervisors debated whether to levy a fee of $143.10 per square foot of new academic space and $69.10 per square foot of new student and faculty housing, but held off taking action on it until its meeting on Tuesday, May 8.
According to consulting firm Keyser Marston Associates, that's how much money Stanford would need to pay to cover the below-market-rate housing needs of the people the university's proposed development would attract to town.
The study estimated that the university's expansion plans would translate into demand for an estimated 2,172 housing units. An estimated 55 percent of those households might be able to afford market rate rent (which the study does not address), but the rest of the housing demand — about 964 units' worth — would come from households that earn less than 120 percent of the area's median income, or about $136,000 for a family of four, in Santa Clara County. Those are the households that require subsidies to afford housing in the area and that the affordable housing fees would be intended for.
The consultants then calculated how much it would cost to build those 964 units for rent by tenants in each income category (38 households in the extremely low income category; 108 in the very low income category; 429 in the low-income category; and 389 in the moderate-income category), and came out with recommendations for two per-square-foot fees: $143.10 per square foot of academic space and $69.10 per square foot of faculty and academic housing.
David Doezema, principal at the firm, told the Santa Clara County supervisors that his firm opted for several conservative assumptions in the calculations upon which the recommendations are based.
Stanford University officials, including President Marc Tessier-Lavigne, expressed surprise at how large the proposed fees were.
"We were taken aback by the fee recommended: an overnight sevenfold increase that vastly exceeds that of any other employer," he told the supervisors in a public comment at the May 1 hearing, comparing the $143.10 fee to the $20 per square foot contribution the university had proposed.
The university already provides and continues to build housing on campus that's subsidized for tenants, said Catherine Palter, associate vice president for land use at Stanford. Whitney McNair, Stanford director of land use planning, said the university provides housing reduced 20 to 40 percent from market rate. Currently, about 40 percent of Stanford staff, students and faculty are housed in Stanford-affiliated housing, including the campus, Palo Alto and Los Altos, she told the supervisors. The university has also received approval for a mixed-use development at 500 El Camino Real in Menlo Park, set to include 215 rental apartments.
Under the university's current general use permit, Stanford can either pay $35 per square foot in affordable housing fees or build one affordable housing unit per 11,763 square foot of academic space, split evenly between being affordable to very low, low and moderate-income tenants. Cash contributions go to Santa Clara County's affordable housing fund and support the creation of housing within a six-mile radius of the university campus, with priority for tenancy given to Stanford employees, according to the Keyser Marston study.
One point the Santa Clara County supervisors discussed is why Stanford should have a fee so much higher than what other companies pay, despite reportedly generating fewer jobs. (Palter said that the university's academic space generates about a third fewer jobs than typical office space.)
Supervisor Ken Yeager pointed to the valuations of Google, Apple and Facebook, noting that Stanford's endowment is smaller. The cities that permit job growth from those and other companies in the region aren't requiring the same levels of contribution to help with affordable housing as the county is proposing to require of Stanford, he argued.
Deputy County Executive Sylvia Gallegos said this discrepancy likely has to do with the fact that cities are under more pressure than counties to attract economic development to fund operations. City governments are often told that developers and businesses will leave the city if fees become too high, she noted.
Care to share?
While the question over what Stanford should pay in affordable housing impact fees falls in Santa Clara County's court, a parallel question has been brewing across the border in San Mateo County: What about us?
At an April 24 meeting, the San Mateo County Board of Supervisors voted 4-1 (with Supervisor Dave Pine opposed) to send its southerly counterpart a letter urging the adoption of the maximum fee set forth in the study, and the designation of "an appropriate portion" of those fees to fund affordable housing efforts in San Mateo County near Stanford.
Ongoing analyses of how Stanford's impacts could affect the broader community evaluate territory within a six-mile radius of the campus, a significant amount of which is in San Mateo County, the letter points out.
"Stanford happens to be in Santa Clara County by accident of where the boundary lines are drawn," said San Mateo County Supervisor Don Horsley. "But the fact of the matter is that at least half of the impacts occur in San Mateo County."
"I think that Stanford really has avoided obligation to San Mateo County for a number of years," he continued. "I think it's time that we hold them accountable for those impacts."
The university has never made a contribution to affordable housing in San Mateo County that he knows of, said John Nibbelin, chief deputy at the county counsel's office, in response to a question by Supervisor David Canepa.
Supervisor Warren Slocum said he opposed giving Stanford "wiggle room" in the letter's wording, and noted that a recent meeting with Santa Clara County Supervisor Joe Simitian left him discouraged about the possibility of receiving funds. "We can hope for receiving some but I didn't leave that meeting with a real warm and fuzzy feeling," he said.
San Mateo County currently has affordable housing impact fees set at $5 per square foot for retail development, $10 per square foot of hotel development and $25 per square foot of office development in unincorporated areas. For single-family projects more than five units, the fee is $15 per square foot, with reduced rates for smaller developments.
For single-unit projects, fees apply only to the portion of the unit that exceeds 2,500 square feet, according to the Keyser Marston study.
Those fees are only a third or a quarter of the maximum amount the county could have charged, said Supervisor Dave Pine, who predicted that Santa Clara County would also not charge the maximum amount.
"Every time I've seen a nexus study in every county around San Mateo, no one ever goes to that extreme," he said. "But I definitely agree Stanford needs to get money into this county for housing. They should have put money in last time. They've got to put it in now."
Several Stanford undergraduates and workers said they supported the full fee. "The thousands of people added to Stanford's campus in the coming years have to live somewhere, and if sufficient funds aren't set aside to provide them housing, rest assured that they will come knocking in other districts throughout the county," undergraduate Amulya Yerrapotu said to the Santa Clara County supervisors.
Stanford undergraduate Nani Friedman described the fee as a "vital mechanism to hold Stanford accountable for the housing crisis in the long run." The proposed fees represent a minuscule fraction of the university's annual operating budget, she said. "I think it's a fallacy to say this would come out of financial support for students."
Yerrapotu and Friedman identified themselves as members of advocacy group "Stanford Coalition for Planning an Equitable 2035" (or SCoPE, for short).
Erica Knox, spokeswoman for SCoPE, told The Almanac that while the university does provide housing at affordable rates to students and faculty, the local SEIU chapter, which has more than 1,200 workers at Stanford, reports that only a handful of workers — more than two and less than five — have ever been chosen from the university's wait-list for Stanford housing.
Simitian added he'd like to see a provision in a policy that stipulates that if the university builds the requisite affordable housing, it would not have to pay fees.
The board is now faced with three options, he summarized: adopt a fee that fully addresses the housing demand the university's expansion would create; ask taxpayers to fill in the difference through public funding of affordable housing; or do nothing, and allow even more new jobs without affordable housing opportunities.
"I don't know how you can pick up a newspaper, go online, or talk to a friend or colleague and think that the status quo is OK," he said. "The time for tepid incrementalism is long since past."
This story contains 1603 words.
Stories older than 90 days are available only to subscribing members. Please help sustain quality local journalism by becoming a subscribing member today.
If you are already a subscriber, please log in so you can continue to enjoy unlimited access to stories and archives. Subscriptions start at $5 per month and may be cancelled at any time.