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Making California Housing Affordable

Apr 25

2007

A bill being considered by the California legislature aims to make the state’s housing more affordable. According to this analysis, the bill amends the state’s Planning and Zoning Act by requiring cities and counties to take more steps to keep housing affordable.

The bill is supported by various home building associations as well as some non-profit groups such as the California Council of Churches, St. Vincent DePaul, and the California State Firefighters Association, which worries that firefighters and other public employees can’t afford to live in the cities they serve.

Is California’s housing system broken? This house would cost $150,000 in Houston, $400,000 in Bakersfield, $950,000 in Marin County, and well over $1.2 million in San Jose.

On the other hand, according to this article, the League of California Cities and a number of city councils have come out against the bill because they believe it would “promote suburban sprawl.” They think that infill housing will adequately provide for affordable housing. Have they looked at housing prices in their communities lately?

The urban sprawl argument plays well in California politics, but it is pure bunk. California is the least sprawling state in America. Census data show that an astounding 94.4 percent of California residents live on just 5.1 percent of the state’s land area. In no other state are such a high proportion of people confined to such a small portion of the state. The average density of California’s urbanized areas is almost 4,600 people per square mile; only New York’s urbanized areas, at a little more than 4,700 per square mile, are denser.

The real reason for the cities’ opposition may be because they fear that residential areas add to their urban-service costs without producing enough property taxes to cover that cost. This is probably not true: prop. 13, which keeps property taxes on existing homes low, allows cities and counties to tax the full market value of new homes and to revise tax rates every time a home is sold.

Under current law, “density is used as a proxy for affordability.” If cities include some dense zoning in their plans, they satisfy the law’s affordability requirements even if the density ends up being million-dollar condos. The proposed law requires cities to include in their plans “quantified objectives (i.e. production estimates) for the development, preservation, and rehabilitation of housing for extremely low-, very-low-, low-, and moderate-income households.”

In addition, the plans must look ahead ten years (instead of the current five) to insure that they have enough properly zoned land to meet these objectives. The law also attempts to simplify and reduce the length of the permitting process.

“California’s housing system is broken,” UC Berkeley professor of urban planning John Landis told a reporter for the Half Moon Bay Review. It suffers from “unnecessary construction delays, reduced housing supplies, higher housing costs, increased crowding and reduced opportunities for home ownership, especially for young and middle-income households.”

If passed, this bill would do more to revolutionize land use in California than measure 37 has done for Oregon. The good news is that the Senate Housing Committee passed it unanimously. The bad news is it still has to go through several more committees whose members may not look on as favorably.

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Reprinted from The Antiplanner