Nonprofit helps builders combat high cost of building in the Peninsula
It was only a matter of time until Silicon Valley’s tech-boom ignited progress in other economic sectors. Now, construction has become the fastest growing industry in the Bay Area with a near 10 percent increase from November 2011 to November 2012. Construction grew the most in South Bay, as well, up more than 13 percent.
Before the recent growth, from 2007 to 2010 construction and financial industries lost more job than any other industry. Nearly 100,000 people lost their jobs.
The California Department of Transportation said in its Santa Clara County Economic Forecast that it expects technology expansion to continue booming until at least 2017. If so, new developments will be needed to provide office space and housing for workers.
But Silicon Valley has finite building space, so the demand for development raises affordability issues across the region. The need for affordable housing, coupled with the Bay Area’s progressive tendencies to be green and efficient with new construction, makes it a bigger and bigger concern.
Since 1999, Crisand Giles has been working in public policy to help control Bay Area development. Giles is executive director of governmental affairs for the Building Industry Association of the Bay Area, where she has lobbied on policy issues such as development fees, green building, green-house gas reduction, and storm water regulation.
The Building Industry Association is a nonprofit group that represents a variety of builders, engineers, design professionals and architectural designers when they don’t have time to represent themselves before municipalities. The association receives funding from member fees as well as a percentage of the escrow when homes are sold in residential developments.
Giles argues that her work at the builder’s association provides an invaluable service because otherwise it’s very difficult for members to defend themselves against cities’ imposed fees they see as unfair. “By not having millions of dollars in feasibility and development analysis on the table, it’s much easier for the Building Industry Association to be able to frame that conversation and make it public than it is for an individual project proponent,” Giles said.
Giles graduated from California Polytechnic State University in 1994 with a degree in soil science and biochemistry. She got her start at the builders association, often known as the BIA, in 1999 after years of working with engineering firms doing erosion and sediment controls. “I came up through the ranks actually being more of an engineering wonk,” Giles said. “The BIA interviewed and hired me because they wanted somebody with technical expertise, somebody who would want to dive into the detail and the impacts of the fees rather than just the rhetoric of just saying we don’t want fees at all.”
In 2003, Giles left the builder’s association to work for home builders. This experience with developments allowed her to become familiar with the region’s communities and city councils, which she said made her a local player when they built in multiple jurisdictions. Often, she already had good relationships with those communities. In 2010, she found her way back to the Building Industry Association.
“It’s not the kind of job you ever think you’re going to get,” Giles said. “I mean, no one thinks of being a lobbyist when they’re in college, but it does have some unique perks.”
The association’s major goal, Giles said, is to create more housing and encourage cities to build on their full allotments the Association of Bay Area Governments granted. “That way, there is a diverse and available supply of housing, which keeps the overall prices lower, and it makes our growing population able to afford a home,” Giles said.
Still, the affordability issue presents consistent challenges for Giles as tech jobs across Santa Clara County continue creating inequalities in income levels. As previously reported in the Peninsula Press, wages for retail, restaurant and hotel jobs remained relatively idle over the last decade, while housing costs rose steadily. More than 80 percent of worker households with jobs in those markets earned less than 80 percent of the area median household income of $76,400 in 2012, while only a third earned less than that percentage in 2001.
“If you look at the communities in the Bay Area that have the highest percentage of affordable housing associated with residential development, none of them have become more affordable,” Giles said. “It’s Palo Alto, Sunnyvale, Mountain View —these are the most expensive places to live.”
In her latest work with low-income housing, Giles led a lobbying effort in December against Mountain View’s policy changes intended to alleviate affordability gap woes.
During its Dec. 11 meeting, the Mountain View City Council adjusted developer fees based on staff recommendations, which Giles and the Building Industry Association previously criticized in comment letters they sent after doing their own reviews of the study. The letters stressed that the city, which ultimately went through with the roughly half the recommended fee changes, was relying on inappropriate methodologies and that a parcel tax would’ve been more suitable since it already had community support, and it could more effectively aid affordable housing.
Mountain View’s changes increased the existing fees for new tech/office buildings from $7.43 to $10 per square foot for building bove 10,000 square feet — and instituted a new $10 charge per net square foot for new residential developments. The city says all revenue from those fees goes to affordable housing funds.
The new fees “make people feel good politically because you’re only punishing one segment of the business community, but it doesn’t really do much to create affordability,” Giles said.
Mountain View City Council members did not return phone calls for comment, though Giles suspects they would have negative views of her, considering that her company repeatedly criticized the city’s justification for the fees.
More recently, Giles has been working on a variety of issues across her jurisdiction, which starts at Fremont, goes down to Monterey, and then returns up San Francisco’s peninsula to the city itself.
“I have to look at a plethora of agendas from each one of those jurisdictions to find out what’s coming up that I might not know about—in addition to juggling fees that I already know that certain cities are discussing,” Giles said. At other times, city staff members often forward Giles information on items yet to show up on the city agenda.
Giles is currently reviewing a San Jose parking fee issue. She also has regular meetings with councilmembers regarding the habitat conservation plan on the city’s agenda. She spends about a day a week in Monterey working on the redevelopment plan for the former Fort Ord Military Installation (a 28,000-acre facility on Monterey Bay), and she has been reviewing park fees in several jurisdictions. Lastly, she is continuing to address housing affordability in Palo Alto, Sunnyvale and Mountain View.
Giles finds her industry more and more difficult to defend but said despite daily dealings with regional fees and policies, the finality of completed buildings is gratifying.
“Once you’re done with this entire conversation—the political component of it, the fee components—there’s actually a building that’s the result of it,” Giles said. “If you’re a kid that likes building blocks or Lego toys, it’s like that. That’s the part that gets me jazzed.”