Tag Archive for: housing shortage

California’s Regulatory Hostility Prevents More New Homes

The median home price in Los Angeles County is $618,000. In Santa Clara County it’s $1.2 million. In the entire state of California, including the somewhat more “affordable” inland counties, the median home price is $548,000.

The national median home price? $227,000.

There’s a reason for this. For decades, California’s state and local governments have made it harder and more expensive for any builder to construct new housing. In most other states, the governing agencies want more housing and they try to make it easier for builders. In California, the exact opposite is the case.

The consequences of this hostile shake-down of builders by California’s state and local governments are a housing shortage, unaffordable homes, an exacerbated homeless crisis, and increased calls for rent control (which will create even more disincentives for home builders).

The response of California’s policymakers to the housing shortage they created is not to address the punitive fees and permitting delays, but to try to cram high density housing projects down the throats of local communities, accusing them of nimbyism – the “not in my backyard” syndrome. The problem with this accusation is that no sane person wants an apartment building plopped next door to them in a neighborhood that used to be single family dwellings. If “nimbyism” means stop destroying well established and tranquil low density neighborhoods with mandated high density projects, then California needs more nimbyism, not less.

Along with punitive fees and permitting delays is a bias against any new housing construction on undeveloped open land, so-called “greenfield” development. The arguments against urban “sprawl” claim that wildlife habitat is threatened by new developments, ignoring the fact that California is only five percent urbanized, with plenty of room for nature preserves and new housing.

The argument that ends most discussions, however, is based on the theory that the expansion of low density suburbs will result in more “greenhouse gas” emissions. This theory, even if you believe that “greenhouse gas” is a threat, is based on biased studies that fail to take into account countless variables that might call it into question, for example: job migration to exurbs to follow the new residents, less congestion on freeways, ever cleaner automobiles, and the potential to telecommute.

According to Dan Dunmoyer, president of the California Building Industry Association, California has more regulations for getting a piece of land approved than anywhere else in the world. This should come as no surprise. In California, if it only takes 10 years for a large housing development to get approval, that’s considered fast. It isn’t uncommon for it to take 20 years or more. In Nevada or Arizona, these same large projects typically get approved within 18 months.

These permitting delays drive all but a handful of very large developers out of the housing construction business in California. And along with delays from the authorities come the lawsuits, many of them based on California’s unique California Environmental Quality Act (CEQA), which environmentalists have turned into a weapon to stop housing projects in their tracks for years. And it only takes one determined environmentalist group to stop development.

A particularly egregious example of this is the proposed Tejon Ranch housing project that has been embroiled in permitting delays and lawsuits for over 25 years. This massive project, a planned community of over 19,000 badly needed new homes, would straddle Interstate 5 in the northwest corner of Los Angeles County. The developers have committed to set aside ninety percent of the land as a nature preserve, after which the NRDC, the Sierra Club, and the Nature Conservancy all withdrew their objections. But it only takes one: The “Center for Biological Diversity” has filed yet another lawsuit.

There’s nothing wrong with setting aside significant tracts of land for wildlife habitat. But when 90 percent of a parcel is not enough set-aside, and existing California law permits endless lawsuits to stop new housing developments, the laws must change. As it is, there is always another well funded environmentalist organization that will oppose all land development, anywhere in California.

While costly permitting delays drive most home builders out of California altogether, the ones that remain pay fees that are literally unbelievable. The low end of fees charged by municipalities to homebuilders are $25,000 to $30,000, usually in the inland counties. On the high end, some cities in the San Francisco Bay area charge fees of over $150,000.

As if that isn’t bad enough, these so-called “pure fees” don’t take into account the other expenses, such as hiring a consultant to determine how big to make the park relative to the other towns, or biological studies, or the purchase of nature preserves. The fees are endless – development, park, fire, infrastructure, art (yes, art), recreation. CBIA president Dunmoyer described a project in Livermore where the total cost was over a half-million dollars per lot just to pay the development fees and expenses associated with land development.

In other states, the cities and counties build parks and other infrastructure themselves, less elaborately and for far less cost, because they want housing and the economic development that comes with new residents. In California, the developer will often pay the park fee and then they don’t even build the park.

Along with the lawsuits and astronomical fees, California’s housing prices are boosted by higher materials costs. In some cases this is because of environmentalist building code mandates. The new solar energy mandates that take effect in 2020, for example, will add up to another $12,000 in additional construction cost per home. But all construction materials cost at least ten percent more in California compared to other states. California’s regulators make it extremely difficult to operate timber and quarry operations in this resource rich state, so materials have to be brought in from elsewhere at additional expense.

Contrary to what one might think, these delays and increased costs that have created sky-high housing values have not enriched the builders. Especially because they must bear the costs associated with pursuing uncertain projects which even when approved are only after decades of effort. Home builders actually make a higher rate of profit on lower priced housing in other states than they do on higher priced housing in California.

When California’s policymakers propose rent control, housing subsidies, and mandate high density housing, they are doing literally everything wrong. Rent control and subsidies will discourage private investment in housing and further undermine a competitive market for new construction. High density mandates will destroy existing neighborhoods, embittering residents, while not creating nearly enough new housing to bring supply and demand into equilibrium. Moreover, the high rise residential projects in the urban core, encouraged by policymakers, cost far more per unit because of the far greater per unit quantities of steel and concrete required for structures over a few stories in height.

The solution to California’s housing crisis is to repeal SB 375 that restricts most new housing to within the existing urban footprint, to repeal CEQA which permits endless lawsuits, and to reform pensions and other out-of-control public employee perks so operating funds – instead of insanely high fees – can help pay for infrastructure upgrades.

Crucially, the mentality of the bureaucracy has to change. They need to treat builders with respect and speed up the permitting process. Improving the attitude and performance of the bureaucracy will be the hardest thing to change, but if Californians are to have the regulatory environment for housing that they need to be able to afford to live here, that’s what’s got to happen.

As it is, California’s state and local governments engage in a shameless shakedown of anyone who wants to build anything, anywhere. Everyone is a victim of this, except for unaccountable bureaucrats who collect the fees and property taxes, and investors who speculate on the real-estate bubble. It is a scandal and a tragedy.

This article originally appeared in the California Globe.

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Too Few Homes, Too Many Homeless: Part One, How it Happened

Apart from the fine weather unique to California, there is little stopping the homeless crisis that grips that state from infecting the rest of America. California’s other even bigger problem, unaffordable housing, is also coming to America. All the elements are in place.

The problem of increasing homelessness boils down to three fundamental policy failures. Massive immigration, overpriced housing, and an inability of state and local governments to properly deal with homeless people.

Volumes could be written about each of these problems, because each of them are symptomatic of deeper challenges. Immigration is fundamentally transforming our culture. Overpriced housing is just one element of the economic asset bubble that offers an illusory, unsustainable substitute for genuine economic growth. And our inability to deal with the homeless is just one example of a stultified society, mired in legal disputes, bureaucratic inertia, and corruption.

Before exploring the specific synergy these three problems have with respect with homelessness, it’s important to declare their larger significance. Because how each of these problems affect homelessness, and how each of them might be solved in order to resolve the problem of homelessness, point the way to larger, more general solutions.

Mass Immigration Raises Demand for Housing

The easiest of these three to understand is mass immigration. It is also the easiest to solve, which unfortunately is only to say the other problems are even tougher. Since 1965, over 60 million people have immigrated to the United States. During that time, the total population has risen from just under 200 million to over 325 million. That is, immigration is responsible for at least 50 percent of the population growth in America during this time. In reality, the number is considerably greater than 50 percent. For example, according to research from the Brookings Institution, over the past ten years, from 2006 through 2017, the population of child bearing age children of native born Americans has dropped by a -0.5 percent per year, while the population of child bearing age children of immigrants has risen by 3.0 percent per year. Immigrants to America are having children at well above replacement levels, while native born Americans are in slow decline.

The point to all that is simple. Demand for housing in America has dramatically increased because of population growth, and population growth has been largely the result of immigration.

One may argue all day that a rising population is necessary to ensure healthy economic growth, but there are important qualifications to that argument. First, while this is generally true, how true it is greatly depends on what sort of immigrants are admitted. The data points to a complex mix. According to a summary of studies done on America’s immigrant population recently published in the National Review, “From 1970 to at least 2000 – and possibly all the way to 2007 – each new wave of immigrants was less educated, relative to natives, than the wave that had come before.” The article went on to state that “The educational decline has ended, but the improvement has not led to economic successes. Another area where the dramatic increase in new immigrants’ education did not result in a dramatic improvement in their situation is welfare use.” With respect to illegal immigration, the data showed them to be the least educated, particularly those from Latin America.

When it comes to immigration, if the United States were able to successfully restrict immigration to skilled professionals, these immigrants would be able to afford homes, and they would be greater contributors to private sector economic growth. But there is a bigger challenge at work, which is what is considered optimal population growth? At what point do Americans decide there are enough people living here, and the downside to mass immigration outweighs the upside? Perfecting an economic model that accommodates slow population growth, or none at all, remains a challenge that no society has met, anywhere on earth. It is a challenge that is most often touted by the American Left for reasons of ecological sustainability, yet the American Left are also the most enthusiastic champions of mass immigration.

Regardless of these nuances, mass immigration has increased the demand for housing in the United States. This has driven up the prices for housing, which has left low income residents – millions of whom are low-skilled illegal immigrants – either homeless or barely hanging on to an overpriced rental.

Political Mistakes Have Artificially Restricted the Supply of Housing

Returning to a numerically moderate, merit-based immigration policy, with secure borders, is a cakewalk compared to rolling back the political mistakes that have restricted the supply of new housing. Across the nation, but especially in blue states like California, it has become extremely difficult for a property owner to develop housing on their land. The array of forces working to restrict housing is daunting – virtually all “enlightened” politicians, powerful environmentalist pressure groups, big land developers, and the financial sector.

In California, for years, state legislation has made it nearly impossible for developers to construct new housing outside the so-called “urban growth boundary.” Instead, development is redirected into the footprint of existing urban areas. Environmentalist laws such as California’s Environmental Quality Act (CEQA) create additional barriers. California’s legislature has now made it necessary for new home construction to be 100 percent “energy neutral” by 2020, greatly increasing building costs.

Where the environmentalist inspired mandates leave off, insatiable public sector greed kicks in. According to a study last year conducted by the San Francisco Bay Area Planning and Urban Research Association, the lowest per house city service and “impact fees” were $20,000, in Sacramento, of all places. The highest fees were a mind-boggling $160,000 per home in Fremont, a city in the San Francisco Bay Area.

What is the true motivation for these outrageous fees – ostensibly to pay for public services associated with new homes? Excessive public sector compensation, “negotiated” by government unions that exercise almost absolute control over California’s state and local politicians. In California, public employees collect, on average, twice as much in pay and benefits as the average full-time private sector employee. The biggest cause of this excess? Public sector pensions and retiree health care, which for retirees in California with 30 years of government service average well over $70,000 per year.

Public sector greed is a primary factor in elevating California’s cost-of-living to punitive levels. The irony is deep. Public employees could afford to make less, if they made less.

Complicit in the artificial, politically contrived scarcity of housing in California are the biggest land developers. These politically connected large firms can afford to wait years if not decades for their projects to gain approval, and they can afford to pay thousands if not millions in fees to attorneys, consultants, and government agencies long before they ever reap any profit. But when they finally sell their housing developments to consumers trained to pay $1,000 per square foot or more, their profits are fat indeed.

No discussion of California’s inflated housing values is complete without explaining the benefit these bubble values impart to financial interests. Mortgage lenders build their base of collateral. Pension funds see their real estate portfolios yield impressive gains. Public entities realize growing property tax receipts. But asset bubbles do not constitute economic growth, and pursuing this economic strategy is both exploitative and unsustainable.

Policies to Address the Homeless Are Inadequate and Corrupt

Insufficient supply in the face of unprecedented demand aren’t the only reasons California has a homeless problem. Miserably inadequate “solutions,” mired in corruption are also to blame. Part of the problem is that the available solutions are hampered by an assortment of judicial rulings.

In the City of Los Angeles the estimated homeless population is estimated to exceed 50,000. They have taken over huge sectors of the city. Moving them out of some of the most desirable public spaces is nearly impossible, however, because in 2006, the Ninth U.S. Circuit Court of Appeals in Jones v. City of Los Angeles ruled that law enforcement and city officials can no longer enforce the ban on sleeping on sidewalks anywhere within the Los Angeles city limits until a sufficient amount of “permanent supportive housing” could be built.

To address this growing problem, in 2016, 76 percent of Los Angeles voters approved the $1.2 billion Measure HHH to “help finance the construction of 10,000 units of affordable permanent-supportive housing over the next 10 years.” How these funds have been applied will be read in history books centuries from now as an example of epic corruption. Here is an excerpt from an email received from a local activist fighting to save the Venice Beach from the homeless invasion. It speaks volumes:

“We know there is a serious problem of large populations of homeless people in and around Los Angeles and we know the solution is not an easy one for anyone. We have compassion for these people and we want to help. But the homesteaders along Venice Boardwalk are not your average ‘down on your luck homeless’, they are mostly either out of prison left in the streets with nowhere to go or bohemian drifters and runaways who are hooked on drugs and choose this lifestyle. Many do have a place to go or capability of other means of existence but prefer the ease the Venice community for comfort, camaraderie and ease of obtaining food and restroom facility.”

Clearly, the homeless encampments in Venice Beach, where well over 1,000 vagrants are estimated to permanently reside, are destroying that community. The response by the city? Conversion of a 3.2 acre city owned parcel into a homeless shelter capable of holding, get this, “about 100 people.” The shelter in progress, which will be “wet,” meaning vagrants who are intoxicated will be allowed to enter the shelter, is located less than 500 feet from the beach. In less corrupt city, that property could be sold, and the proceeds could be used to set up and monitor a tent city housing thousands of people. This excerpt from another email received from a neighborhood activist in another afflicted part of Los Angeles explains what’s really going on:

“Unfortunately, there is too much money involved for anyone to be considering tent cities. The costs are running between $400,000 and $500,000 per unit for the projects. All of the parcels they are considering are worth millions of dollars and the taxpayers of LA would be much better off if the city just sold them and used that money to fund government rather than new taxes. Everyone at city hall is pushing these facilities. The city has billions to spend on them. The City Council members get campaign donations from the developers. The developers then use our money to build these buildings. The buildings are then handed off to nonprofits with long term contracts to run them. When we showed up to protest the Sherman Oaks proposed sites, our opposition consisted of LAHSA, United Way and a bunch of other so-called non-profits that stand to get big dollars from these sites.”

These inflated costs are well documented. This absurd waste is repeating itself throughout California.

Watch Out, America. This Corruption is Coming to Your State

It isn’t impossible to fix the problem of inadequate, unaffordable housing, and a burgeoning homeless population. What California’s facing isn’t something that had to happen. But powerful special interests like things just the way they are, and those special interests are growing in influence across America.

At the national level, the push for open borders is possibly unstoppable, thanks to the peculiar alliance between all Democrats who want to import voters, hard Leftist globalists who want to undermine and ultimately destroy America as we know it, libertarian globalists naively standing on principle, and big business interests hoping to suppress wages. That’s a tough coalition to crack. But it gets worse. Perhaps even more influential are the financial elite, who have decided on a macroeconomic level that the real estate asset bubble must be maintained in order to preserve credit enabling collateral. These financial wizards view immigrant fueled population growth as an essential factor in maintaining high demand for real estate.

At the national level, an equally daunting alliance has formed to make housing construction more difficult. The environmentalist movement leads the way, clamoring for a smaller “urban footprint,” using “climate change” paranoia as the moral bulldozer to clear away opposition. But the bulldozer is rarely necessary. The intelligentsia – that is, mainstream media, think tanks, and thought leaders in the professions of architecture, design, construction, engineering, and infrastructure – has glommed onto the small-is-beautiful theme, pushing for “new urbanism,” “smart growth,” “in-fill,” “urban containment,” “transit villages,” “light rail,” “densification,” and so on. But they’re not alone.

Right behind the environmentalists are the public employees, whose pension funds and property tax revenues are goosed by real estate bubbles. On a parochial level, but more often than not, an additional incentive cities have for densification and urban containment is that it keeps development within their municipal borders, within confined areas, lowering the per capita cost of providing public services at the same time as it grows revenues.

While California is so far gone it may only serve as a cautionary example, it would be a mistake to assume that any other state is immune from these influences. In Texas, a state where homes remain affordable, voters in November elected a Democrat as the new chief executive for Harris County. Don’t laugh. Harris County is the 3rd largest county in America, covering all of Houston and greater Houston, with over 4.5 million residents.

One may safely presume that Democrats will push for restrictions on housing using the same tactics they use in California – i.e., urban containment, environmentalist construction mandates, escalating fees. But the surprise election of Democrat Lina Hidalgo, a 27 year old with no government experience, is not the first wave assault on home affordability in Houston. It’s the next wave.

A thorough expose of the encroachments “smart growth” zealots are making on policy in Houston can be found in urban geographer Joel Kotkin’s August 2018 article published in City Journal, “The Battle for Houston.” Kotkin explains how despite the success Houston has had to-date with minimal zoning and practical flood control infrastructure, the zealous “experts” are trying to change everything. Instead of upgrading flood control channels and levees, they are proposing mandatory elevated homes, something that would cost more, and disproportionately harm low income neighborhoods. And, of course, the experts are advocating “for the creation of a “thick” (meaning denser) city, with an enhanced role for traditional transit.”

Houston, beware. Everything the smart growth crowd asks for, they’re going to get, as long as Democrats – and their coalition of big business, big labor, unionized government, financial predators, environmentalist nonprofits and their army of trial lawyers – are in charge. The war for California was lost. California has to be recaptured, if that’s even possible. The war for Texas is on, with the largest metropolitan area already in enemy hands.

America, the scarcity profiteers are coming for you.

This article originally appeared on the website American Greatness.

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Defining Appropriate Housing Development in California

One of the most frustrating contradictions inherent in the policies being enacted by California’s one-party state goes something like this: We are inviting the welfare cases of America and the expatriates of the world to move here, while simultaneously enacting environmental policies that make it extremely time consuming and expensive to build anything.

No wonder there’s a “housing crisis.” Until demand decreases, or supply increases, housing in California will remain unaffordable for most of its residents. But don’t expect demand to slacken any time soon. The political consensus in favor of increasing California’s population has a strong moral justification – why shouldn’t the wealthy, innovative, compassionate people of California be willing to share their wealth with millions more people who are less fortunate? But there are other less high-minded upsides to population growth and obstacles to new housing.

Currently, real estate prices and rents are on the rise, favoring investors and landlords. Banks enjoy higher lending volumes, while borrowers enjoy greater liquidity, however precarious, as the property bubble offers them more collateral as security. The government agencies profit from higher property tax assessments and higher capital gains collections on sales of real estate. Large land developers that have the political clout and financial heft to build housing despite the many obstacles, enjoy unusually high margins that they could never achieve in a normal competitive market. Finally, as an expanding population increases demand for housing, at the same time public school districts can increase attendance-based revenue – which will make it somewhat less urgent that they reform their union work rules and spending priorities.

Efforts by California’s policymakers to increase the supply of housing have to be viewed in this context. They want to increase the supply of housing. Yet they also want to keep happy the special interests that pay for their political campaigns. Therefore, strict – and very self-serving – parameters are likely to limit what new laws are enacted to stimulate new housing. For example:

Negative Consequences of Special Interest Defined Development in California

(1) Additional open land outside of urban boundaries will remain off limits to development, in order to ensure that existing municipal jurisdictions are able to retain access to the new property revenues that will accrue to new stocks of residential and commercial real estate. This will be justified as necessary to protect the environment.

(2) Most obstacles to housing construction will remain in place – in particular, excessive fees to government agencies and onerous CEQA requirements. This will ensure that only the most powerful corporate and financial entities will be able to take advantage of new opportunities to build housing, while cutting out the small landowners and developers.

(3) Major land developers will be given financial incentives by state and local government entities to build “affordable housing” and eliminate “blight,” but these incentives will be out of reach for smaller landowners and developers.

(4) In order to keep the real estate asset bubble fully inflated, housing prices will only fall marginally as development occurs, which pretty much helps nobody, but massive programs of taxpayer funded rent control and rent subsidies will be enacted to make up the difference for qualifying low income families.

(5) “Densification” will be imposed on residential neighborhoods, with the primary victims being any neighborhoods that are situated close to bus stops or light rail stations. Developers will be permitted to build multi-story, multi-unit buildings on small residential lots and will not be required to offer parking; all of this will greatly increase their profits.

(6) Building code requirements will relentlessly increase in the name of energy efficiency and safety, with the practical effect being to lock out small landowners and developers from being able to afford to upgrade their properties or develop new properties; these same more stringent regulations will not seriously impact large development corporations and financial investors.

It is wrong to be entirely cynical about the laws that are coming. Slamming the door completely shut on newcomers to California would be cold hearted, unpopular and probably cause more economic harm than good. Zealously enforcing residential zoning densities that were put in place several decades ago would be overly sentimental, ignoring the disruptive adaptations and radical transformations that have defined and enriched urban life since settlement began. Completely embracing a new wave of suburban sprawl would needlessly eat up more open land than a more balanced policy approach might cost. While the new building code mandates are now excessive (if not ridiculous), nobody wants to go back to toilets with seven gallon tanks, or insulation with an R value of 2.0.

Unfortunately, balance is not what we’re finding in the new laws. Last year, the State Senate considered a bill – SB 827 – that would have removed local zoning control and allowed multifamily housing to be built in well-established single family neighborhoods. This would have allowed those multifamily housing projects to be as tall as 55 feet. Against heavy opposition, SB 827 never made it out of committee, but this year it’s back. The new legislation, again sponsored by Democrat Scott Wiener, is SB 50.

Reading through the text of SB 50 grants insight into just how entrenched the collusion is between public officials and developers seeking subsidies and waivers. Consider this introductory language:

Existing law, known as the Density Bonus Law, requires, when an applicant proposes a housing development within the jurisdiction of a local government, that the city, county, or city and county provide the developer with a density bonus and other incentives or concessions for the production of lower income housing units or for the donation of land within the development if the developer, among other things, agrees to construct a specified percentage of units for very low, low-, or moderate-income households or qualifying residents.

In plain English, the “Density Bonus Law” forces taxpayers to subsidize not only developers who are already making more money by being allowed to pack more units on less land, but also low and “moderate” income households who will occupy a percentage of housing units. Bring ’em in! Paying artificially high prices for housing while also paying for someone else’s inflated rent will never wear thin with taxpayers.

The Coalition to Preserve LA, “a citywide movement of concerned residents who believe in open government, people-oriented planning, equitable housing and environmental stewardship of Los Angeles,” produced this summary of SB 50.

Densification a la SB 50:

  • Forces cities to allow luxury towers in single-family areas.
  • Upzones thousands of beautiful streets to 6- and 8-story apartments if an area is “jobs-rich with good schools.”
  • Upzones thousands of single-family areas within a 1/4 mile of a frequent bus stop or 1/2 mile of a rail station.
  • Lets developers sue any city that tries to stop them.
  • Cuts parking to zero, claiming rich residents “use transit.”
  • Falsely claims to protect renters & sensitive communities.
  • Strips protections of many HPOZs and historic buildings.
  • Lets developers wipe out setbacks, backyards, green belts.

For millions of Californians who live in bucolic suburbs, with tree lined streets and spacious private yards, SB 50 unchecked is going to be a holocaust. It will utterly destroy their way of life. Many victims will not have the ability to move. The greatest insult of all: Their taxes will be paying for it. And as a “solution,” it is completely unnecessary. There are better ways, that leave established neighborhoods intact and cost taxpayers nothing.

Reforming the California Environmental Quality Act (CEQA)

There are two ways to mitigate the impact of CEQA, the law that requires “environmental impact reports” on any land development in California, including “climate change” impact along with a host of metastasizing additional requirements. The first, being practiced increasingly, is to grant CEQA waivers to politically connected developers that are proposing projects deemed politically correct. The second, far preferable solution, is to fundamentally rewrite CEQA.

An excellent summary of how to reform CEQA appeared in the Los Angeles Times in Sept. 2017, written by Byron De Arakal, vice chairman of the Costa Mesa Planning Commission. It mirrors other summaries offered by other informed advocates for reform and can be summarized as follows:

  • End duplicative lawsuits: Put an end to the interminable, costly legal process by disallowing serial, duplicative lawsuits challenging projects that have completed the CEQA process, have been previously litigated and have fulfilled any mitigation orders.
  • Full disclosure of identity of litigants: Require all entities that file CEQA lawsuits to fully disclose their identities and their environmental or, increasingly, non-environmental interest.
  • Outlaw legal delaying tactics: California law already sets goals of wrapping up CEQA lawsuits — including appeals — in nine months, but other court rules still leave room for procedural gamesmanship that push CEQA proceedings past a year and beyond. Without harming the ability of all sides to prepare their cases, those delaying tactics could be outlawed.
  • Prohibit rulings that stop entire project on single issue: Judges can currently toss out an entire project based on a few deficiencies in environmental impact report. Restraints can be added to the law to make “fix-it ticket” remedies the norm, not the exception.
  • Loser pays legal fees: Currently, the losing party in most California civil actions pays the tab for court costs and attorney’s fees, but that’s not always the case with CEQA lawsuits. Those who bring CEQA actions shouldn’t be allowed to skip out of court if they lose without having to pick up the tab of the prevailing party.

Unfortunately, California’s new governor, Gavin Newsom, while acknowledging problems with CEQA, has put responsibility for recommending changes to CEQA in the hands of a task force consisting of labor union officials and land developers. It will be a surprise if a group dominated by these two special interests will be capable of coming up with the solutions recommended by De Arakal and others.

Principles of Appropriate Development in California

There is a moral imperative to increase the supply of housing in California. As noted, California’s policymakers have awakened to the fact that construction of new housing is not nearly meeting demand for new housing. But the way they’re going about stimulating housing construction is flawed. It will not appreciably lower the cost of housing and it will needlessly enrich special interests. Here are some ways housing could be more appropriately developed in California:

(1) Eliminate all forms of government subsidies, incentives or waivers to any developers. All players in the housing industry should be unsubsidized, and playing by the same set of rules.

(2) Stop requiring diverse types of housing within the same development or neighborhood. Mixing high-density, subsidized housing into residential neighborhoods devalues the existing housing, and this social engineering is unfair to existing residents who have paid a high price to live there.

(3) Roll back the more extreme building codes. Requiring 100 percent of homes to be “energy neutral” or include rooftop photovoltaic arrays, for example, greatly increase the cost of homes.

(4) Lower the fees on building permits for new housing and housing remodels. Doing this might require pension reform, since that’s where all extra revenue goes, but until permitting costs are lowered, only billionaire developers can afford to build.

(5) Speed up the permitting process. It can take years to get permits approved in California. Again, the practical effect of this failure is that only major developers can afford to build.

(6) Reform the California Environmental Quality Act as noted. Better yet, scrap it altogether. Federal laws already provide adequate environmental safeguards.

(7) Make it easier to extract building materials in-state. California, spectacularly rich in natural resources, has to import lumber and aggregate from as far away as Canada. This not only greatly increases construction costs, it’s hypocritical.

(8) Increase the supply of land for private development of housing. Currently only five percent of California is urbanized. There are thousands of square miles of non-farm, non critical habitat that could be opened up for massive land development.

(9) Engage in practical, appropriate zoning for infill and densification in urban cores, but only after also increasing the supply of open land for housing, and only while continuing to respect the integrity of established residential neighborhoods.

California has unaffordable housing because extreme environmentalists have imposed an agenda onto state policymakers that, unfortunately, dovetails perfectly with the agenda of special interests – in particular, public sector unions and bureaucrats, and large corporate land developers and construction contractors. This coalition is also responsible for the related problem of neglected infrastructure in California. Until California’s voters wake up and break this immoral, self-serving coalition, there is little hope that housing prices in particular, or the cost-of-living in general, will come down in California.

This article originally appeared on the website of the California Policy Center.

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