IN FAVOR – Inclusionary Housing Ordinance Changes – May 19, 2026 – 7A 20265999
Dear Mayor Ashcraft, Vice Mayor Pryor, Councilors Boller, Daysog and Jensen Thank you to staff, the Planning board, and this council for approaching a genuinely hard problem around the Inclusionary Housing Ordinance with both rigor and adaptability. Good policy sets general principles while remaining directional enough to produce the outcomes we actually want based in reality. Tonight's proposal, already approved by the Planning Board, gets closer to that balance by reflecting on real market conditions.
The math needs to work
I want to highlight the urgency. Alameda was the first city in the Bay Area to adopt its 2031 Housing Element. We must also deliver on it. We’re slipping, last year we permitted just 65 units (the majority just ADUs), reaching only 12% of our 5,353-unit RHNA target. That gap should alarm all of us.
We live in a capitalist economy and must confront a basic reality: housing gets built when projects are financially viable.
Developers have to make the math work. Reading through letters submitted to the planning board in November, the numbers were sobering: construction costs up 30% since they started this project (6.2% this year alone), and the constraints of the current income mix requirements leading to some rentals sitting vacant in the Launch. Alameda needs to be the place where the math pencils out, or we simply won't get it built. Yesterday’s New York Times had an in-depth editorial about the meteoric rise of housing costs. The conclusion: the best way to drop the cost of housing for everyone is to build more.
The shift away from moderate-income rental requirements reflects alignment with both state law and regional standards. AB 1505 requires alternative compliance pathways for rental projects. MTC's Transit-Oriented Communities program requires rental inclusionary units to serve households at 80% AMI or below. This matters because TOC alignment makes Alameda competitive for regional transportation funding. It also reflects a market reality the Times editorial board put plainly: when affordability requirements make projects unprofitable, they don't get built. Moderate-income units sitting vacant at the Launch are proving that point locally, giving pause to the developers.
Examine the whole pipeline
Other cities are acting on this. San Jose launched a targeted fee reduction program in late 2024 after seeing zero market-rate housing construction starts that entire year. The result: over 1,400 units moved from entitlement to construction within months. A unit that never gets built produces zero affordable housing. In addition to doing the in-lieu fee study, Alameda should commit to moving other levers in our control: reviewing our own timelines and fee structures. I hope you as a council, and planning and building department are measuring permitting timelines and setting goal timelines for plan review and keeping accountable to those goals. Front-loading costs at permit issuance rather than at certificate of occupancy burdens developers during the highest-risk phase of a project, before a single unit is occupied. These are within our control. And it's worth saying who actually pays these fees: they get passed through to future residents in rent and mortgage payments. Lower development costs mean more affordable housing in practice, not just on paper.
Unlock real projects that help Alamedans
That's why it's genuinely encouraging that tonight's proposal appears to also unlock a concrete project: the Foundry, 260 units at Alameda Marina. I'm a resident of central Alameda and a parent of two girls at Love Elementary, so I've watched this project closely. The developers at Alameda Marina built a $35 million seawall, remediated the soil from previous industrial uses, opened our waterfront for public access, and delivered stellar bike infrastructure on Clement. More importantly, the project added neighbors my daughters count as schoolmates and friends, who enrich the fabric of our school and Alameda. I raise that because conversations about AMI thresholds and in-lieu fee structures and permitting timelines can feel clinical, like management of numbers on a balance sheet. But a house built today is a concrete improvement in someone's life, now, to live the Alameda Dream. Not in a hypothetical stronger market. And that makes Alameda better today.
Thushan Amarasiriwardena
Central Alameda
Alameda Free Library Board President, Love Elementary School Site Council Secretary
1 May 17, 2026
Honorable Mayor and Members of the City Council
City of Alameda
2263 Santa Clara Avenue
Alameda, CA 94501
Re: Public Hearing, May 19, 2026 — Ordinance Amending AMC Section 30-16, Inclusionary Housing Requirements (File 2026-5999)
Dear Mayor and Councilmembers,
I am writing as an Alameda resident in support of the proposed amendment to the Inclusionary Housing Ordinance scheduled for introduction on May 19. The amendment reflects careful work by staff, the consultant team, and the Planning Board, and it positions Alameda to keep producing housing at a moment when the regional pipeline has slowed considerably.
By way of background, I have spent more than a decade working in real estate development. My career has spanned affordable housing investment and development, public-sector economic development, and market-rate multifamily development across California and New York. I have sat on both sides of the table and seen firsthand what it takes to advance housing production, especially affordable housing.
I was born and raised in California to parents who arrived as refugees from the Vietnam War.
Growing up here, I understood firsthand how stable, affordable housing shapes the trajectory of a household across generations. That experience is what drew me into this work professionally, and it is also what brings me to write this evening as a resident.
Why this proposal matters
Housing production across the Bay Area has slowed for reasons that go well beyond any single local ordinance. Interest rates, construction costs, and general market volatility are all weighing on feasibility. Inclusionary requirements alone will not unlock the pipeline, but how those requirements are calibrated to current market conditions has a material impact on whether projects pencil. A well-calibrated requirement with predictable compliance options could make the difference between a project that breaks ground and one that sits entitled on a shelf. This amendment improves both.
The amendment as proposed represents a meaningful step forward and has my full support. As Council looks ahead, I want to flag two areas that deserve continued attention and action.
Recommendation 1: Prioritize the in-lieu fee nexus study and move toward adoption quickly
The in-lieu fee schedule was carved out of this amendment pending a nexus study, and this is an area that requires considerable and prompt attention. As anyone in real estate knows, time kills 2 deals. Having the in-lieu fee option available sooner gives developers an additional tool when they need it most and maximizes the window in which the city can put that resource to work. I encourage Council to direct staff to complete that work and move toward adoption and implementation of a fee schedule as quickly as possible. The city should have every available compliance tool in place and ready to use.
Additionally, when the fee schedule comes back for adoption, I would encourage Council to build an automatic escalator directly into the ordinance. Fee adjustments currently require separate Council action, which means fees can drift below the cost of producing affordable housing in the years between updates. Berkeley adjusts its in-lieu fee biennially using a construction cost index and several other Bay Area cities have similar mechanisms. Building this into the ordinance at adoption would keep fees calibrated over time without requiring periodic discretionary action.
Recommendation 2: A TCO-conditioned off-site contribution pathway in the fee study
As the nexus study moves forward, I would encourage staff and the consultant to evaluate one additional compliance pathway that connects the in-lieu fee mechanism with the Clustered Development framework in Section 30-16.6.
Under this pathway, a market-rate developer could satisfy the inclusionary obligation by contributing directly to an off-site affordable housing project that meets the Clustered Development criteria. The market-rate project's Certificate of Occupancy would be conditioned on the affordable project pulling building permits and closing on construction financing. If no qualifying off-site project has been identified by the time TCO is requested, the developer would pay the equivalent fee into the City's affordable housing fund.
The strength of this structure is that it ties market-rate momentum directly to a real affordable project moving into construction. Fee revenue can sit in a fund for years before being deployed.
A direct contribution paired with a TCO condition delivers affordable units on the ground inside the same construction window as the market-rate project. Critically, the funds flow directly from the market-rate developer to the affordable project with no city intermediary, which simplifies the transaction and accelerates deployment.
While this type of arrangement may already occur on a case-by-case basis through Affordable Housing Agreements, explicitly codifying it as a defined compliance option provides clarity and predictability for developers and the City alike. An off-site project does not need to be identified at the time of AHA execution. The developer would have flexibility to identify a qualifying project during the construction period, with a project confirmed as TCO approaches. The mechanics around timing windows, contribution sizing, and release conditions are appropriately left to staff and the consultant to develop.
Closing
The proposed amendment reflects exactly the kind of evidence-based, feasibility-aware approach that Alameda needs at this point in the market cycle. I encourage Council to introduce the ordinance on May 19 and to adopt it on June 2. I also encourage Council to direct staff to complete 3 the fee study within the Planning Board's recommended timeline, incorporate the off-site contribution concept into that work, and include a built-in escalator when the fee schedule comes back for adoption.
Thank you for the time and care that has gone into this update. I am happy to serve as a resource to staff in a private capacity on any of these issues.
Respectfully,
Jimmy Ly
Alameda, CA 94501
[email protected]
(626) 233-2956