Local Preference Ordinance
City Council
March 12, 2025
Background
• Local preference policies prioritize local applicants of deedrestricted affordable units • Preference, not a requirement; other income-eligible applicants are still eligible to apply
• City already has a more limited policy implemented through regulatory agreements with property owners
• Current policy provides a preference point to current residents and workers who work at least 20 hours weekly within the City Why an Ordinance?
• State Law alignment: local preference policies for tax-credit funded projects are allowable in the context of local adoption (GOV Code 7061)
• Adoption = resolution or ordinance
• Full evaluation of compliance with fair housing law
• Incorporate policy adjustments informed by AntiDisplacement Roadmap Staff Recommendation
Staff recommends the City Council to consider the
introduction of the proposed Local Preference Ordinance that would, in the context of deed restricted affordable units:
Give a preference point to applicants who live, have lived, or work in the City during the housing lottery process.
Policy Goals
• Prevent displacement of residents and workers in the City • Provide opportunities for prior displaced residents to return • Codify & expand an existing policy implemented through regulatory agreements to ensure alignment with State/Federal legal and grant requirements.
Fair Housing Law Considerations
• Fair housing law must be
considered when providing a
preference
• Fair housing law provides a threestep legal defense process • Must fail all three subsequent
defenses to be successfully
challenged
• Disparate Impact Analysis found
no meaningful discriminatory
impacts
No current/future discriminatory
effect towards a protected class.
Serves a legitimate need that
overrides discriminatory effect
No feasible alterative practice with
less discriminatory effect
Most defensible
Least defensible
1 2
3 Disparate Impact Analysis
1. No selection rate below 80% policy aligns with legal best practice
2. Prior households not analyzed = proposed policy will likely equalize rates (SSF vs.
Peninsula) White
Black or
African
American
American
Indian or
Alaskan
Native
Asian
Native
Hawaiian /
Pacific
Islander
Two or
more /
Other
Hispanic
or Latino
Worker
Selection Rate
90.7% 109.1% 94.5% 114.5% 256.5% 88.6% 97.2%
Household
Selection Rate
87.9% 68.2% 62.5% 105.4% 96.8% 104.7% 137.2%
Weighted
Average
Selection Rate
[current policy]
90.1% 102.7% 84.7% 111.7% 234.6% 99.8% 110.6%
Displacement & Prior Displaced
• 2012-2022: 36% decrease in
Hispanic/Latino households in
SSF making under $150,000
• Decrease especially acute for
households making under
$75,000
• Proposed policy provides
residents, workers, and
displaced residents greater
opportunity to qualify for safe &
affordable homes
Housing
was too
Expensive
My landlord
refused repairs
and I didn’t
know where to
find help
Conditions were
unhealthy and I
couldn’t afford
anything else
Community Input from Anti-Displacement
Roadmap
Policy Structure
Housing Element
Alignment
• Policy EQ-3: Support residents who are atrisk of being displaced • Policy EQ-8: Protect existing residents
from displacement in areas of lower or
moderate opportunity and concentrated
poverty and preserve housing choices and
affordability
• PRSV-5.2 Assist tenants at risk of
displacement
Research Conducted
• Originally targeted as a live preference, expanded to work to eliminate disparate impacts / fair housing concerns
• Point based waitlist system; preference eligible applicants offered units first • Equally weighted preferences, includes former residents Redwood City: Local Preference Policy (2021)
• Establishes 7 targeted preferences tailored to vulnerable populations such as displaced due to BART construction or at-risk of homelessness • Allocation based waitlist system; 75% units reserved for preference policy applicants
• Complicated application process; some preferences require applying separately for a certificate to establish preference eligibility City of Berkeley: Affordable Housing Preference Policy (2024) Applicable Properties
The proposed policy applies to deed-restricted affordable properties resulting from:
• City inclusionary housing requirements
• State Density Bonus units
• Developments acquired, constructed, or rehabilitated with City financing
• Including 100% affordable projects
Housing Lottery: How it Works
Current residents
Former residents
Workers: 20+ hours weekly in SSF
Workers: accepted job offer
1 preference
point (max) =
considered first
All other applicants
0 points =
considered once
preference list is
exhausted
Council Action
Staff recommends the City Council to consider the
introduction of the proposed Local Preference Ordinance that would, in the context of deed restricted affordable units:
Give a preference point to applicants who live, have lived, or work within the City during the housing lottery process.
Questions?