This is how one Bay Area bakery is taking the affordable housing crisis head-on

BERKELEY — Behind a spacious Victorian in Berkeley, a remodeled, two-story granny unit is rising.

With vaulted ceilings and a chic reclaimed wood and corrugated metal exterior, it’s not the sort of product you’d expect coming from Arizmendi, an association of worker cooperatives best known for its bakeries in the East Bay, San Francisco and San Rafael.

But you can expect more accessory dwelling, or in-law, units from the association to come: It just launched a new cooperative, called Roots and Returns, aimed at developing and maintaining affordable housing. The new initiative is a direct response to the rising rents and soaring home prices gripping the Bay Area, said Tim Huet, a founding worker-owner of Arizmendi who now serves on the association’s cooperative development team.

Too many of the worker-owners who staff Arizmendi’s bakeries and other coops were driving long distances because they couldn’t afford to live close to where they work, he said. Or, they were facing evictions from landlords selling their home or doubling their rents.

“We realized that if we’re just creating jobs, but we’re not creating housing,” Huet said, “then we’re not really creating a secure environment for our workers.”

When California relaxed its rules around granny, or in-law, units, the association saw an opportunity, Huet said. It can be daunting for homeowners to secure financing, find architects and contractors and then wade through a sea of permits and bureaucratic red tape to build a granny unit.

“We thought, what if we could just come to a homeowner and say, ‘You’ve got some underutilized space in your backyard, how about we build affordable housing here,'” Huet said. “They get a part of the rent, and the rest of the rent goes toward building new affordable housing.”

They’re hoping to build the units relatively inexpensively by relying on skills the association already has.

Founded in 1996, Arizmendi now has six bakery locations, including the Cheese Board in Berkeley, an accounting coop called Strength in Numbers, a construction company and a landscaping business. Each coop operates independently, and a separate cooperative functions as the staff support for all the other coops, which together have more than 200 worker-owners.

Unlike traditional businesses, which rely on a hierarchical organizational structure, coops are democratically governed. And all the workers are co-owners of their particular coop. At Arizmendi, that means workers earn a wage, but they also share in any profit the coop makes. Decisions about how to run the business are made through group consensus, said Mahasin Munir, whose been a worker-owner at Arizmendi for 16 years.

“It’s a marriage,” Munir said. “You’re in a relationship. So, there’s compromise.”

Worker-owners learn to cooperate so the business can be more successful, because when it is, there’s more profit to share. And they also tend to rely on each members’ particular skill sets as a way to cut down on costs, which is, in part, how the Arizmendi Construction coop got its start, Huet said.

“We have a lot of people who are skilled at maintaining their own businesses and who have developed construction skills,” Huet said. “They were interested in expanding.”

But so far, the construction coop was really only doing small projects, said Ruet Bernard, a worker-owner in Arizmendi Construction. The two-story accessory dwelling unit in Berkeley was its first big job, he said, and it’s taught valuable lessons in how to manage larger projects. In a few months, when it’s completed, the remodeled unit will feature a spacious kitchen and dining room for the ten residents of the main house, plus a full bathroom and two rooms on the second floor.

Ultimately, the Arizmendi association hopes Roots and Returns will serve as a vehicle for developing and maintaining affordable housing by working with homeowners who are sympathetic to the plight of low-income renters in the Bay Area to design and construct an accessory dwelling, or in-law, unit in their backyard, said Ashley Ortiz, a member of Arizmendi’s coop development team.

The construction coop will actually build the houses, she said. But Roots and Returns will be the landlord, collecting rent and settling any disputes between the tenant and property owner. Units will be income-restricted and rented at rates affordable to the tenants, Huet said. The property owner will receive a monthly check, and any money made on top of that would go back into the coop so it can develop more housing.

The housing units are not specifically for Arizmendi’s workers, Huet said. But the coop will be giving priority to people in the service industry, whether they work in food service, as school teachers, firefighters, EMTs, or other types of service work. And there will be some preference to those who have strong connections to the area, he said.

“A lot of people who provide essential services are being pushed to the margins of the Bay Area,” Huet said. “That’s what Roots and Returns is all about: giving people secure roots in the Bay Area and actually helping people who have been pushed out to return.”

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