On Tuesday, May 2, The Berkeley City Council passed a first-of-its-kind – called, Helping Achieve Responsible Development with Healthcare and Apprenticeship Training Standards or “HARD HATS,” creating new health insurance requirements for construction workers and new apprenticeship programs. The new law, which was authored by Mayor Jesse Arreguín and several of his colleagues on the City Council, applies to projects over 50,000 square feet and takes effect on January 1, 2024. (Though implementation could take longer.)
HAC fully supports requirements for home builders to provide construction workers with healthcare, that’s a no-brainer. We also often support impact fees that contribute to broader shared goals, so long as they don’t jeopardize the economic feasibility of housing. With that said, the apprenticeship requirement in this bill, or the ability to pay fee towards apprenticeship programs, is an important goal that we also support — though the devil will be in the details once implemented.
As Berkeley and cities across the region ramp up housing production, we need to ensure that the workers building these homes are compensated fairly and provided equitable benefits that allow themselves and their families to prosper.
Yet, the ordinance isn’t all rosy. Since the bill’s introduction late last year, we have been concerned about the opaqueness and lack of transparency around just how much this fee will cost — and we remain concerned about the potential for this fee to raise the costs of housing construction in an increasingly tough economic market.
Upon introduction, the biggest worry was that the ultimate bill language would include a prevailing wage requirement for all projects over 50,000 square feet without any streamlining or benefit to offset the costs. This would have unquestionably stifled housing development in a big way, and we advocated strongly that such a requirement not be included in the bill’s final text. The biggest victory is that the final language did not include this sort of housing-killer. Beyond this, our advocacy, alongside Progress Public Affairs and various HAC members, also resulted in several other important amendments:
— Trailing legislation that calls for a feasibility study of these costs
— Consideration of fee offsets upon conclusion of the feasibility study
— Consideration of upzoning to help make this program more feasible
— Delaying implementation of the ordinance until 2024
While HAC is very familiar with how additional requirements can disincentive development, we applaud the city for taking steps to ensure these new costs won’t make Berkeley a place where it’s too expensive to build.
How?
In the 24 hours leading up to the bill’s adoption, our joint advocacy also resulted in three additional and important concessions:
— Requiring the feasibility study, consideration of fee offsets and upzoning (eliminating language that would’ve allowed it to be optional)
— Allowing City staff to implement specific regulations to make it workable for developers/applicants
— Giving City staff the latitude to push back implementation, which we believe will be necessary given the complexity, and meaningful because it will help move the timeline of implementation of this ordinance into alignment with the completion of the feasibility study
We appreciate Mayor Arreguín for agreeing to include these important provisions. And while we are proud to have helped make this a better bill, and agree with its overall goals, we do hope the calculation of the apprenticeship fees can be better understood and become more transparent in the coming months. The biggest objection from our members wasn’t that it was a bad idea, but that the fee couldn’t clearly be articulated or calculated — and it hasn’t yet been studied. We find it questionable that the City Council decided to implement a new fee before completion of the feasibility study, and we believe this is poor practice from the standpoint of good public policy. We believe the mayor’s campaign for State Senate was the elephant in the room that prevented that from occurring, and electoral politics can most certainly make for sloppy policy.
We also want to recognize the line of questioning from Councilmember Rashi Kesarwani, who ultimately abstained from the quickly approvedlegislation proceeding without all the needed facts and data.
We’re proud to say that this effort was in response to requests from HAC and our friends at Progress Public Affairs, as our goal is for cities to implement data-driven policies that don’t unintentionally make it more difficult to build new housing.
To that end, while HAC is typically cautious of legislation that adds building fees, we’re glad that the Mayor and City Council are committed to analyzing the data and passing legislation that will lead to a more equitable, abundant, and prosperous Berkeley.
We will be following up on this as we move closer towards implementation, and may consider giving a presentation at the HAC Regulatory Committee in the fall once some of the details are clearer.
Feel free to contact us with questions, and you can read more from Berkeleyside here.
