To enhance local affordability. To foster inclusive communities.

From conflict to collaboration: How Davis, CA, built a partnership with UC Davis University to address housing concerns

From conflict to collaboration: How Davis, CA, built a partnership with UC Davis University to address housing concerns

Overview

This case study examines the college town of Davis, CA, where a university, city, and county developed a memorandum of understanding (MOU) to address increasing student demand for rental housing. The MOU included commitments to increase the supply of university-sponsored housing, make new transit investments, and ensure the university contributed to the city’s public resources.

Image of Davis, CA.

Key takeaways 

 

  • Localities adjacent to universities can use an MOU to help mitigate the impact of a large student population on housing and public services. MOUs can formalize the university’s responsibility to contribute to housing and public resources, like transportation, and can include performance metrics to create accountability mechanisms for the university.  
  • MOUs can improve the “town-gown” relationship. For instance, they can create channels for regular communication by establishing working groups or formal public meetings with city and university leadership.
  • MOUs can provide the framework for regularly tracking and reporting progress. MOUs can require regular reporting to track progress towards the MOU’s goals, assess the state of the housing market, and share progress with the public. 

Description

Davis, California, is a small city of about 64,000 in Yolo County. Adjacent to Davis is the University of California Davis (UC Davis), a large and growing university with approximately 40,000 students and 25,000 employees. While the UC Davis campus is not within Davis city limits, more than 60 percent of its students reside within the municipality.  

Due in part to the growing student population and land use regulations designed to limit growth and preserve agricultural land, housing in Davis has been a complex and sometimes contentious issue. For example, in 2024, campus neighbors sued UC Davis to block West Village, a large proposed development for students and faculty. Similarly, in 2007, other residents sued the city to block the expansion of a student room house close to campus. In 2018, the American Federation of State, County and Municipal Employees also sued UC Davis to block the implementation of the university’s Long Range Development Plan (LRDP) and expansion of West Village. Each lawsuit contended that these projects did not undergo a proper environmental review, as required by the California Environmental Quality Act (CEQA). 

Davis has experienced a very low housing vacancy rate and an increase in rent prices that has outpaced inflation. Between 2017 and 2018, the average rent for an apartment increased by 8.5 percent. According to the 2022 Joint Annual Housing Report, from 2015 to 2019, 16.6 percent of renter households in Davis were cost-burdened, and 39.4 percent were severely cost-burdened. Rising rents and low vacancy rates have motivated some renters to move outside of Davis. Additionally, the city has seen higher rental unit occupancy as renters share bedrooms or repurpose other rooms as bedrooms.

In 2018, as the school’s expanding student population occupied an increasing share of the city’s housing stock, tensions developed between UC Davis and the city. Specifically, the city expressed concerns over the university’s LRDP, which projected a 5,000-student increase in enrollment between 2017 and 2018 along with the addition of 9,050 student housing beds on campus. Officials and planners from the City of Davis stated the LRDP did not adequately address the environmental, housing, traffic, and other impacts of planned growth. They also said the plans for new construction were not bound to an enforceable timeline. The city demanded that the university house more students on campus and provide compensation for the strain that the large student population placed on public services. 

In response, UC Davis agreed to enter into a memorandum of understanding (MOU) with the city and Yolo County to address their concerns. According to background information included in the MOU, the city and county indicated in July 2018 that they might pursue litigation if UC Davis approved the LRDP and the West Village expansion. In order to resolve their differences, the three parties agreed to mediation and development of the MOU. 

The MOU committed UC Davis to building more housing for students and faculty. The university agreed to a multi-year set of housing construction benchmarks that would ultimately increase the number of student housing beds by 15,000 by the fall of 2023. Additionally, UC Davis consented to provide on-campus housing to cover all student population growth (i.e., all additional students who enroll beyond the 33,825 enrolled at the time of the MOU). To hold the university accountable to this plan, the MOU required that it pay $500 per bed for all beds not completed as promised. If the university had to pay these fees, 80 percent of the funds would go to the City of Davis and the remaining 20 percent to Yolo County. 

In the MOU, UC Davis also committed to end the practice of holding master leases, which allowed the university to set aside apartments in the city for university students instead of housing them on campus. This placed extra strains on the already tight rental market. Before the MOU, UC Davis held such leases on apartment buildings in the City of Davis to ensure that transfer students, who are admitted to the university later than other students, could find housing.

Additionally, the MOU outlined a joint transportation plan that included traffic improvements and investment in alternative transportation, including bike and pedestrian infrastructure and a plan for Transportation Demand Management (TDM). The university agreed to make financial contributions and approvals for a variety of traffic projects, including an interchange, road improvements, a bike path, and landscaping and lighting enhancements. It also committed to inviting representatives from the city to its working group on its bus system, Unitrans, which serves the campus and surrounding neighborhoods in Davis. 

The MOU also formalized a stronger partnership between the university and the city. It established an annual public meeting to be attended by the Chancellor of UC Davis and elected Davis officials. It also required two additional public meetings in the first year after the MOU was established to be attended by two members of the Davis City Council, two members of the Yolo County Board of Supervisors, and two high-ranking employees of the university, including one employee with the rank of vice-chancellor or higher. The city and university also agreed to hold four working group meetings annually to produce written reports for the public. 

In addition to these meetings, the MOU mandated a continuing strategic partnership and collaboration between the city, county, and university. As part of this collaboration, UC Davis committed to conducting an economic and fiscal analysis of the university’s impacts on the City of Davis and the surrounding area.

The university also made a series of financial commitments to lessen the strain on public services. It agreed to pay the equivalent of the city’s parcel taxes for school and library services for any new projects that will house university faculty or staff on and off campus. It also waived its right to seek a property tax exemption for master leases in the 2019-20 academic year, the final year it used them. The university also agreed to contribute $25,000 a year to Davis’s Rental Resources Program, which provides renter education and works to ensure that rental units are safe and compliant with state and local laws.

Finally, the MOU stipulated that the City of Davis and Yolo County would not take legal action against the UC Davis LRDP nor challenge the CEQA-required environmental impact report the university completed for its proposed West Village expansion. The city and county agreed to support the LRDP and West Village expansion and issued a joint public statement.  

Process and timeline

  • 2018: UC Davis submitted an LRDP with plans to enroll 39,000 students by 2030-2031 and increase campus beds by 9,050. 
  • July 2018: The City of Davis requested the University of California Board of Regents delay approving the LRDP and accompanying Environmental Impact Report (EIR). Nonetheless, the Board approved the LRDP on July 19, 2018. 
  • September 2018: In response to the disagreements over the LRDP, UC Davis agreed to work on an MOU with the city and county. The MOU was finalized in September 2018. 
  • November 2019: The city and university published their first Joint Annual Housing Report
  • Spring 2020: The COVID-19 pandemic paused annual reporting in 2020 and 2021. The pandemic caused vacancy rates to temporarily rise in Davis, although as pandemic restrictions eased, vacancy rates fell again and rent prices continued to increase. 
  • Fall 2021: The university had increased the number of beds to 13,793.
  • April 2023: The city and university published their 2022-2023 Joint Annual Housing Report

Outcomes

UC Davis built enough housing to cover 100 percent of its enrollment increase since 2018. As of the 2022-23 school year, it had added 3,790 beds for an increase of 2,939 students. 

UC Davis exceeded the MOU timeline targets for a total number of existing beds for two consecutive years (2019 and 2021). As of the spring of 2023, it was on track to have 15,098 of its target 15,000 beds by the fall of 2023. 

The university added these beds by developing new housing and redeveloping aging buildings. It redeveloped two apartment buildings to increase housing capacity by approximately 1,616 students. It also constructed a new apartment building that houses 3,290 students and replaced two aging residence halls with new halls that house an additional 440 students. Some of these buildings house students with families. Because of these new developments, beginning in the fall of 2020, UC Davis had sufficient on-campus housing for transfer students and ended master leases in the city. 

The university also expanded its housing assistance, including its need-based rent subsidy program. Its Basic Needs Center allows students to request assistance with needs like food and stable housing and hosts a rapid rehousing program alongside other housing resources like legal services and conflict resolution. 

Consistent with promises to make traffic improvements, UC Davis and the City of Davis collaborated on a plan to improve a three-mile corridor with updated multimodal transportation, along with landscaping and infrastructure enhacements. They also agreed to a plan to replace 1.3 miles of a bike path along this corridor. 

Despite the new construction, the City of Davis did not see an increase in the average vacancy rate for large apartment complexes. In 2018, when the MOU was formalized, the vacancy rate was 0.4 percent. In 2022, that rate had fallen to 0.2 percent. Similarly, rents continued to rise steeply in Davis, according to the 2022 Apartment Vacancy and Rental Rate Survey commissioned by the university. From 2021 to 2022, the average rent increased by 9.4 percent. 

Policy significance

The City of Davis may serve as an example for similar college towns with rapidly growing student populations straining the city’s housing stock and public services. Localities in such situations may consider using an MOU like the one between the City of Davis, UC Davis, and Yolo County to protect the interests of all parties and create a plan that benefits the entire community.

The MOU the three parties developed may also be a model for similar localities due to its range of detailed commitments to both housing and transportation, including metrics for success and a focus on facilitating a more cohesive town-gown relationship. Even before such challenges arise, an MOU may be useful to preemptively formalize a university’s responsibility to the city where it is located and set expectations for the multi-party relationship.

Related resources

  • Joint Annual Housing Report (2019). This is the first Joint Annual Housing Report published by the City of Davis and UC Davis. It provides an overview of current housing conditions as of 2019, summarizes the university’s plans for housing construction, presents data on city and county-wide vacancy rates and housing affordability, and reviews the Rental Resources Program. 
  • Joint Annual Housing Report (2022-2023). This is the second Joint Annual Housing Report. It provides updates on many of the projects laid out in the 2019 report, including various university-constructed housing projects that have been completed since the MOU was put in place. The City of Davis presents updated data on vacancy rates and housing affordability, as well as housing construction that is in progress or has been recently completed. 
  • Memorandum of Understanding. This Memorandum of Understanding entered into by Yolo County, the City of Davis, and UC Davis contains commitments from the university to construct new housing and contribute to various city programs and resources. It also lays out plans for enhanced communication and partnership between the city and the university. 
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