When Local Control Backfires
The housing shortages that plague most urban areas are a prime example of the complications that can arise when states take a back seat.
Many political analysts believe that local government is the best government. The act of delegating responsibilities to states and localities is thought to increase accountability by putting governments closer to the people. But local governance can backfire, especially when parochial interests trump larger regional concerns. Nowhere is this more evident than in housing, where prices are skyrocketing in many U.S. cities.
Fast-growing cities, in particular, are struggling to accommodate population increases because zoning and other land use regulations can stop housing construction, causing shortages, price inflation and overcrowding. The obvious solution would be to change these regulations, but such efforts often meet resistance from the community, specifically homeowner groups who dislike the impacts of new development and have a vested interest in discouraging it to keep their own home values high.
San Diego is a good example of this problem. It features a hyper-local model that has been codified into the planning framework. The city has 42 community planning groups, each representing different neighborhoods and made up of about 16 members each. The groups have vast influence over their areas, says Maya Rosas, a local development consultant. Whenever the city’s planning department writes a new neighborhood plan, it “does extensive outreach with the planning group, and technically the city writes the plan incorporating the feedback they receive.”
As a self-described YIMBY (“yes in my backyard”), Rosas joined her neighborhood group, the Uptown Planners, to advocate for more housing construction. But she’s found that the group, which generally consists of older homeowners, is dominated by NIMBYs, or a “not in my backyard” contingent. That part of the group recently spearheaded residential downzoning -- a plan to decrease density. The move seemed senseless to Rosas because Uptown is a centrally located neighborhood with strong housing and transit demand. In fact, the need for housing throughout San Diego has led median home prices to skyrocket by 48 percent since 2012, to $543,000.
This model is common in other big, housing-constrained cities as well. The planning departments in Boston and New York City, for example, also work with neighborhood groups. In Los Angeles, the shift to community planning in the 1970s caused mass downzonings that, despite gradual population increases, remain in effect. The median home price in Los Angeles County is $560,000. Indeed, the approach recently caused Brooklyn-based real estate journalist Stephen Smith to write that “the effect of local control has turned sinister.”
To get around some of these conflicts, land use control has been shifted from localities to states in some cases. In 2016, Massachusetts succeeded and California failed in passing legislation to streamline the development approval process in municipalities. But this strategy comes with moral hazards, as local autonomy takes a backseat to top-down decision-making. A better alternative may be for cities to reform themselves from within. That would mean shifting land use decisions from the neighborhood to the administrative level, while having those administrations grow more permissive toward development, letting it adapt to population and market changes.