Facebook has new challenge: Housing

By Bill Silverfarb

As Facebook looks to expand its headquarters in Menlo Park to accommodate thousands of new employees, the city is being challenged to address its neglect related to building affordable housing over the years.

The city’s shortcomings may fall on the shoulders of Facebook as it is being urged to develop or contribute the funds needed to build thousands of affordable housing units in and around Menlo Park.

Last night, the Menlo Park City Council weighed in on the development agreement for the Facebook East Campus project at 1601 Willow Road with an intent to secure a commitment from the social media giant to fund housing opportunities in the city and surrounding region. Facebook is asking Menlo Park to allow approximately 6,600 employees to occupy the East Campus, that includes nine buildings on the 57-acre site once occupied by Sun Microsystems.

A conditional development permit between Facebook and Menlo Park, however, caps the number of employees at the site to only 3,600 people. Facebook asked the city to instead cap daily trips to and from the campus at 15,000 rather than cap the number of employees who will occupy the campus.

Currently, about 2,000 employees occupy the East Campus, according to Facebook. Plans for the West Campus, with two buildings on 22 acres, have yet to be discussed.

While Facebook is already partnering with a developer near the campus to build about 250 housing units, affordable-housing advocates say much more will be needed.

The city has recently closed the comment period for the project’s draft environmental impact report and response letters focused heavily on Facebook’s impact to the region’s housing needs and Menlo Park’s failure to meet its affordable housing obligations under the state’s Housing Element Law.

Envision-Transform-Build East Palo Alto and a coalition of groups including Urban Habitat; Youth United for Community Action; and Peninsula Interfaith Action blasted the city in a DEIR response letter for failing to plan for growth and future housing needs.

According to the California Department of Housing and Community Development, Menlo Park has not adopted a housing element since Sept. 8, 1992 despite being required to do so in both 2001 and 2009.

The only other city in the state with the same distinction is Cudahy, in Los Angeles County.

Between 1999 and 2006, Menlo Park’s fair share of the region’s need for new housing included 184 units of affordable to very-low income, 90 to low income and 245 to moderate-income households. But Menlo Park issued permits for only 11 moderate-income units during that period and none for very-low and low-income units, according to data from the Association of Bay Area Governments and provided by Public Advocates, a San Francisco-based agency that advocates for affordable housing.

Menlo Park Mayor Kirsten Keith told the Daily Journal yesterday that the city is looking hard at its housing needs.

“We absolutely understand the importance of the housing element and need to update it. We will be able to do what we need to do,” Keith said regarding Facebook’s need to expand.

To help with the negotiations, the city has hired David Boesch, former San Mateo County manager and Menlo Park’s former city manager.

The company’s Chief Financial Officer David Ebersman told the council last night that the next few months will be critical in determining whether Facebook will make Menlo Park its permanent home.

“The city should have appropriate, considered expectations,” Ebersman said regarding public benefits the city is seeking from the expansion. Facebook’s presence will boost commerce, attract new business and bring the employees’ energy to the city, Ebersman said. Some one-time benefits the city is also seeking from Facebook in the form of public benefits include upgrading the Bay Trail to improve bicycle access to the campus and some area streetscape improvements.

For the current planning period, which runs through 2014, Menlo Park must accommodate 993 total new housing units, including 226 units affordable to very-low income, 163 to low income and 192 to moderate-income households, according to the DEIR response letter from Envision-Transform-Build East Palo Alto and the rest of the coalition.

With the state’s recent action to dissolve redevelopment agencies, a critical tool to build affordable housing has now been taken away, Councilwoman Kelly Fergusson told the Daily Journal.

She also said housing was more of a social impact rather than an environmental impact to the surrounding community.

The city has made some progress in addressing the city’s affordable-housing needs, she said.

To mitigate Facebook’s impact on the region’s housing needs, Envision-Transform-Build East Palo Alto and the other groups want the company to develop or fund the development of 1,034 units of very-low income housing, 1,598 units of low income housing and 1,692 units of moderate income housing, according to the response letter.

The group also wants Facebook to modify the proposed project to include on-site housing for lower-income employees.

Lastly, it wants Facebook to agree to hire locally in filling new very-low and low income jobs to lessen the impact on transit and housing pressures in the area.

Facebook’s outreach and hiring should extend to the city of East Palo Alto, which will be most directly impacted by the project, according to the coalition letter.

The East Palo Alto City Council also discussed the potential impacts of Facebook’s expansion on its community in a meeting last night.

Environmental analysis of projects such as the Facebook Campus project is required by the California Environmental Quality Act.

The CEQA process and final EIR for the project should be finalized by late April and the development agreement should be finalized by June, according to city staff.

Bill Silverfarb can be reached by email: silverfarb@smdailyjournal.com or by phone: (650) 344-5200 ext. 106.