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California Could Upend City Building Rules in Bid to Make Housing Cheaper

Housing prices in California continue to soar, in part because many cities have discouraged dense development. That’s led to a big fight in Sacramento over whether the state should force cities to allow apartment and condo buildings near transit stations.

BART Strike
Recently introduced legislation in California would force cities to allow denser development near transit stations.
(AP/Jeff Chiu)
Frustrated with cities that repeatedly block dense development, one California state senator has set off a huge debate by proposing that the state should sweep aside local restrictions to allow more concentrated housing near major transit stations.

Astronomically high housing costs have long plagued California, and the problem has only grown worse in recent years, particularly for Southern California and the Bay Area. Housing prices statewide are up 74 percent since their lowest point in the Great Recession, according to Zillow. The average home in California in 2015 cost two-and-a-half times the national average, and California’s average monthly rents were 50 percent higher than the rest of the country. Half of Californians said affordable housing was an “extremely serious” problem in a poll last year, and a quarter of respondents said they had thought of moving out of the state because of it.

But the proposal from Scott Wiener, the state senator who represents all of San Francisco, goes beyond the traditional housing fights. It would be an overt act of state preemption in a blue state, at a time when Democrats routinely criticize Republican leaders in red states for overriding their local control. By doing so, state lawmakers would essentially be blaming local governments for stymying development, pushing up housing prices and forcing residents to commute for hours to find affordable housing.

More than that, it would be a loud declaration that the California of Silicon Valley office parks, vast freeways and bucolic suburban neighborhoods should give way to a more crowded, centrally controlled and environmentally conscious future. It would be an admission that spreading out is not always the answer to high housing prices, and that it may even be part of the problem. And it would clear the way for development to thrive along major transit routes the same way it seems to naturally spring up along highways.

Wiener says the state needs to step in because localities now have basically unlimited power over what kind of housing gets built and where. Most local governments, he adds, have misused that power to serve parochial interests rather than the goals of the whole state, which include reducing carbon dioxide emissions, promoting diversity, and promoting shared prosperity.

“Every city or town acts as if it lives in its own universe. There’s always an incentive for people to say they don’t want more density here. They love that they can live across from the transit station in a single-family house. They love that their neighborhood by the BART [the Bay Area’s subway system] station has the small town feel,” Wiener says.

“But when you look statewide, the impact of low-density zoning around transit stations is huge. It pushes people to move further and further away,” he adds, because demand forces prices up for the limited number of housing units nearby. Those longer commutes lead to worse traffic, more pollution and a host of other problems.

Some prominent city leaders have backed Wiener’s legislation. San Jose Mayor Sam Liccardo supports it, and Oakland Mayor Libby Schaaf and Sacramento Mayor Darrell Steinberg have been receptive. On Friday night, Los Angeles Mayor Eric Garcetti said he's "all for" Wiener's bill, so long as it includes protections against demolishing existing rent-controlled units near transit stations.

But many cities see it as a direct challenge to their authority. Berkeley Mayor Jesse Arreguín called it “a declaration of war against our neighborhoods.”

The California League of Cities opposes what it calls “another housing bill that takes away local discretion and authority.”

California lawmakers passed a package of 15 laws last year designed to alleviate the housing crisis. The package included new money to help build low-income housing, more latitude for cities to impose affordable housing requirements on new developments, and imposes new requirements on cities to promote the construction of new residences.

One of those new laws, also sponsored by Wiener, allows developers who build multiunit housing to bypass certain local government reviews in areas that have fallen behind their state-mandated housing goals. Ninety-seven percent of localities fell short of at least some of those goals, which means they will be subject to streamlining requirements.

But Wiener says more changes are needed. “Our job is not done,” he says. “We didn’t deal with this issue of low-density zoning around transit.”

The League of Cities, though, warns that Wiener’s current proposal, Senate Bill 827, would “give developers and transit agencies, who are unaccountable at the local level, the power to exempt themselves from locally developed and adopted building height limitations, densities, parking requirements and design review standards.”

In its current form, Wiener’s legislation would affect neighborhoods within a half-mile of a major transit stop or a quarter mile from a major transit corridor. Developments in those areas would be exempt from local regulations on residential density, maximum floor area ratio and parking minimums. It would also preempt height restrictions lower than 45 feet to 85 feet, depending on the characteristics of the street.

The bill is still in its introductory stage and California lawmakers won’t take it up until they start committee work next month. It would likely take months before it could reach the governor’s desk, and it is likely to be amended as it moves forward.

But the proposal has already attracted an inordinate amount of attention for a bill in such an early stage.

The Sierra Club, for example, has weighed in against it, because it preempts local ordinances. Other states, it notes, have used the same tactic to prevent cities from enacting affordable housing mandates for developers.

“This bill has the right aim, but the wrong method,” said Lindi von Mutius, Sierra Club chief of staff, in a statement. “We know that some members of the legislature are working to refine the bill to make it less damaging in approach. We hope they are successful, because we need more transit-oriented development that is appropriately sited to ensure smart, walkable communities that improve quality of life, reduce pollution, and fight climate change.”

Act LA, a Los Angeles-area coalition that works on affordable housing and transit access issues, also came out against the proposal. The group points out that Los Angeles has passed several programs to encourage developers to build affordable housing, and it says the new proposal could undermine those efforts with “an open the floodgates approach” toward building new housing.

“It is clear that in the City of Los Angeles, SB 827 will exacerbate the very issue it seeks to remedy, especially in low-income communities and communities of color,” it explained in a letter to Wiener.

Wiener is trying to address those concerns and will likely file amendments this week to try to ensure that the state program doesn’t interfere with local affordable-housing initiatives.

But the measure has gathered a lot of support, too. More than 120 of the state’s tech leaders are backing the legislation, because they say high housing costs makes it difficult for them to attract workers to their California operations.

“The housing shortage places a huge burden on workers, many of whom face punishingly long commutes and pay over half of their incomes on rent,” they wrote in a letter to Wiener, as first reported by the Los Angeles Times.

“Caltrain and BART receive significant state funding and are the backbones of our regional transit infrastructure,” they added, “and yet these systems are not able to realize their full potential because too few people are able to take advantage of them to shorten their commutes.”

Wiener cautions that, even if his bill takes effect, it will take a while before neighborhoods start changing. “This will play out over years and decades,” he says, but it’s vital for the future. “California has always been a beacon to the world, where people want to come. We want to keep it that way, but housing threatens that.”

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