The board's action commits $18 million over the next four years to an issue that is driving up the costs of doing business for all public, private and nonprofit employers in the Silicon Valley.

The supervisors say the decision propels them into more of a leadership role in the housing crisis facing the South Bay.

"This action by the board, even during a recession, demonstrates our commitment to addressing the fundamental issues contributing to instability in the lives of many in our county," Supervisor Jim Beall says.

Through its action, the board created a new, high-profile department, the Office of Affordable Housing, which is expected to more efficiently focus the efforts of the county on affordable housing services delivered to seniors, the disabled and others who are reliant on county services.

In addition to the new department, the plan will establish special needs housing as a county priority; create a County Housing Commission; develop a leadership role for the county in regional, state and federal housing policy advocacy; and expand partnerships with other public jurisdictions to make surplus public land available for housing.

The action was the result of an 18-month process by hundreds of community members from Palo Alto to Gilroy.