$1 billion Aggie Square project in Sacramento could be delayed over affordable housing litigation.

The $1 billion Aggie Square project at UC Davis in Sacramento faces litigation from a coalition of a dozen neighbourhood and activist groups that assert the university’s environmental impact report ha s failed to address the affordable housing issue.

The project is expected to create about 5,000 construction jobs and revitalize the area’s economy, according to a report by Sacramento broadcaster Fox 40. However, the lawsuit filed by Sacramento Investment Without Displacement says the project would bring in 7,700 residents while providing only 324 additional housing units.

The lawsuit claims “…the vast majority of the Project’s population will have to find housing in neighborhoods surrounding the Project or elsewhere,” and that the project “will exacerbate existing housing inequities and drive displacement in some of Sacramento’s most historically underserved communities.”

Housing activists said the goals of economic equality and justice will fall by the wayside in the adjacent Oak Park, Tahoe Park and South Sacramento neighborhoods, the broadcaster reported.

“A lawsuit… it’s leverage I suppose, but it’s not productive,” Sacramento Mayor Darrell Steinberg was quoted as saying.

Project proponents say 700 units of housing are in the works, along with anti-displacement measures. “We’re looking at a mortgage assistance program, a rental assistance program, first-time homebuyer loans,” said Councilman Jay Schenirer.

These initiatives will be financed by increased tax revenues.  As well, construction and ongoing jobs will be set aside for local residents.

“3,500 to 5,000 ongoing permanent jobs that are union jobs, that are high paying — that’s the best way we can prevent displacement,” Schenirer said.

But the lawsuit is a sign that some neighborhood groups don’t buy into the promises.

City officials said more public meetings and discussions with those not a part of the lawsuit are planned for January when a plan that satisfies displacement concerns could be hammered out.

Initial projections called for Phase One of Aggie Square construction to begin in the first half of 2021, but the litigation could disrupt that timeline, Fox 40 reported.