East Palo Alto’s City Council has set the stage for a major shift in how the city handles affordable housing, telling staff on Tuesday to craft a temporary rollback of its inclusionary housing rules while a broader county study plays out. The move, pushed by newer council members Webster Lincoln, Mark Dinan and Mayor Martha Barragán, was framed as a way to jump-start stalled developments. Critics countered that it gambles with the already thin safety net for the city’s lowest-income residents.
Council orders staff to draft temporary changes
According to Palo Alto Online, the council on Tuesday instructed staff to come back with an ordinance that could “temporarily pause or change” East Palo Alto’s local affordable-housing requirements while the city participates in a San Mateo Countywide housing study. At the same meeting, activist Ruben Abrica blasted the effort as a “half-cooked process” and urged residents to organize against it, the outlet reported.
What the current law requires
Right now, East Palo Alto’s Inclusionary Housing Ordinance requires that 20% of units in new for-sale and rental projects be affordable. For projects with fewer than five units, developers must either provide at least one affordable unit or pay an in-lieu fee instead, according to the City of East Palo Alto. The city’s guidelines further divide rental obligations into 5% of units restricted at 35% of area median income (AMI), 10% at 50% AMI and 5% at 60% AMI, and list an in-lieu fee of roughly $299,200 per required inclusionary unit for the current fiscal year.
Precedent: Four Corners and project-by-project relief
While the new proposal would set a citywide policy, the council has already shown it is willing to bend the rules for individual projects. In September, it granted Sand Hill Property Company permission to omit very-low-income units and to reduce the number of affordable townhomes at the long-vacant “Four Corners” parcel at University Avenue and Bay Road. As reported by The Almanac, that relief was technically limited to the single project, but it has helped set the tone for the current review of the city’s broader rules.
Why now: RHNA pressure and stalled builds
City Manager Melvin Gaines warned council members that East Palo Alto is on the hook to produce more than 70 very-low-income units and roughly 100 middle-income units by 2028 under its Regional Housing Needs Allocation. Supporters of dialing back the local standards argued that without some temporary easing, those targets will be tough to hit and some developments will never get off the ground. According to Palo Alto Online, they pointed to projects that developers say are stuck because of high costs, including a proposed townhome development at 1201 Runnymede Street.
Reactions from the community and officials
Public comment at the hearing showed a community sharply divided. Longtime residents and housing advocates warned that weakening affordability rules could strip key protections from the city’s poorest tenants and homeowners. Council backers of the change, along with some builders, countered that the current standards and hefty in-lieu fees are so strict that they scare off new construction altogether, according to coverage by The Almanac. Former Mayor Duane Bay urged the council to stick with a more targeted, project-by-project strategy instead of a sweeping rollback, and city staff said they would return with a more detailed briefing before any ordinance is actually put to a vote.
Next steps and what to watch
Staff will now draft the proposed ordinance and bring it back for council review, while the countywide housing study that East Palo Alto has joined is expected to shape any long-term revisions. In the coming weeks, look for a staff report and additional public hearings. Any change to the Inclusionary Housing Ordinance would alter how developers meet their obligations - whether through on-site affordable units, off-site options or in-lieu fees - and could influence which projects ultimately move forward in East Palo Alto’s development pipeline.
