Article published by Mercury News (https://www.mercurynews.com/2019/05/28/these-students-had-a-housing-idea-facebook-listened-now-its-becoming-reality/)

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MENLO PARK — When 20 local high school students walked into Facebook’s office last year and laid out their plan for solving the region’s affordable housing shortage, they didn’t really expect the tech executives in the room to listen.

But the Facebook team was moved and helped turn the students’ idea into a $1.1 million reality — a pilot program to fund four small backyard granny flats for low-income residents in East Palo Alto and Menlo Park. Facebook will contribute $325,000 to the effort, and Menlo Park-based nonprofit Soup will put in $775,000.

“It’s surreal to kind of see what we talked about actually happening,” said 16-year-old Nataly Manzanero Perez, a sophomore at Sequoia High School in Redwood City.The money will finance low-interest loans for low and moderate-income homeowners who couldn’t otherwise afford to build a granny flat and might struggle to get traditional financing. When the granny flats, also known as accessory dwelling units, in-law units or casitas, are complete, they must be rented out at below-market-rate to low-income families — simultaneously creating new affordable housing and providing extra income to the homeowner who builds the unit. It’s the latest attempt by Facebook, often blamed for driving up housing prices by flooding the area with highly paid tech workers, to tackle the region’s crippling affordable housing shortage.

The pilot is a partnership between Facebook, Soup and affordable housing developer EPA Can Do. The students who inspired it are part of an organization called Youth — Plan, Learn, Act, Now, or Y-PLAN, which incorporates the housing crisis and other civic issues into students’ lesson plans. The students spent months researching housing conditions in Menlo Park and East Palo Alto, walking neighborhoods and interviewing residents, as part of a Facebook-backed study. They then presented their findings to the tech company and Menlo Park City Council. One of their main suggestions was to build more casitas.

“It was like, ‘Oh, wait a second, here is something that the youth are asking for that we can actually get started on relatively soon,'” said Maya Perkins, Facebook’s strategic initiatives manager.

Facebook and its partners will fund three units in East Palo Alto backyards and one in Menlo Park’s Belle Haven neighborhood, ranging in size from about 600 to 1,000 square feet, with two or three bedrooms. The units each will cost between about $200,000 and $350,000 to build. Construction hasn’t started yet, but EPA Can Do and Soup have submitted permit applications for three of the units.

The backyard units will be funded either by three-year loans or 30-year loans, depending on the homeowner’s needs. Once the loans are paid off, that money will go back into the program to fund more backyard units

For the duration of the loan, the units must be kept affordable for families making less than 80 percent of San Mateo County’s median income — or about $103,300 for a two-person household. That means the homeowner couldn’t charge that family more than $1,936 a month in rent. The average rent in San Mateo County is $3,250, according to RentCafe.

Backyard units have become a major part of the conversation whenever politicians, housing providers or activists talk about solving the Bay Area’s affordable housing shortage. Cheaper, faster and easier to build than traditional housing, and able to share a lot with an existing home, the casitas are seen by many as affordable. Recently passed state laws made it easier to permit and build backyard units, and the state Senate last week passed Senate Bill 13, which would further streamline the process. But for homeowners interested in a backyard unit, the cost of building one still can be daunting.

That’s where the new program comes in.

“It’s just really exciting to see what a responsible corporate partner can do in a community to start to make things permanently affordable, or to have long-term affordability increased,” said Pam Dorr, Soup’s director of affordable housing.

It’s not Facebook’s first attempt at testing a small-scale housing solution. The company is subsidizing housing for 22 teachers in an apartment building near its Menlo Park headquarters, a five-year, $5 million pilot program Facebook hopes can be replicated in the future. Facebook also has invested $18.5 million in affordable housing construction and protection through its Catalyst Housing Fund and is gearing up to build its proposed new Willow Village campus in Menlo Park — which includes 1.75 million square feet of office space and 1,500 new homes, including 225 affordable apartments.

Several Y-PLAN students involved in Facebook’s housing study recently got a chance to visit one of Soup’s backyard casitas in Menlo Park. For many, it was their first time seeing a granny flat, and they were impressed by the sleek, modern look of the 640 square-foot, two-bedroom, one-bathroom unit.

The casita, which was built in Soup founder Joshua To’s backyard and now is rented by a family of four, pre-dates the Facebook partnership. But it’s an example of what is to come.

Standing inside the unit’s kitchen, playing with the automatic blinds on the windows and the Alexa on the counter, 16-year-old Mia Palacios, a sophomore at Sequoia High School, said she’s proud of what she’s accomplished.

“It’s like, I’m just 16,” she said, “but I was part of the good change in my community.”