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Catalysts
Housing Bills Raise Red Flags
You might not have noticed that more than 25 housing bills, of a total of nearly 70 bills on deck this 2021 legislative year, are scheduled for committee hearings on April 15. The Assembly Housing and Community Development Committee will vote on 22 bills. The Senate Housing Committee will consider another half dozen bills.
So far this year, SB 9 (Atkins) and SB 10 (Wiener) are getting the bulk of attention. The push for building significantly greater density in neighborhoods zoned for single-family homes is raising sirens of alarm. The two bills lay the groundwork to replace single-family, owner-occupied homes with rental housing.
The trend follows a pattern described in a recent article in The Atlantic entitled, “When Wall Street is Your Landlord” and published in The Marin Post. Author Alana Semuels writes:
"Between 2011 and 2017, some of the world’s largest private-equity groups and hedge funds, as well as other large investors, spent a combined $36 billion on more than 200,000 homes in ailing markets across the country. In one Atlanta zip-code they bought almost 90 percent of the 7,500 homes sold between January 2011 and June 2012; today institutional investors own at least one in five single-family rentals in some part of the metro area."
Senate leader Atkins calls the 2021 Senate Housing Package “Building Opportunities for All.” Uttered in full, it would more likely be called “Building Opportunities for All Developers and Real Estate Investors/Speculators.”
For example, in addition to the devastating impacts of SB 9 and SB 10, SB 8 (Skinner) is a companion measure. The bill is intended to clarify Senator Skinner’s “Housing Crisis Act of 2019.” Capitol Tracks provides a summary of the bill.
"Existing law, the Housing Crisis Act of 2019, requires a housing development project be subject only to the ordinances, policies, and standards adopted and in effect when a preliminary application is submitted, except as specified. The act defines “housing development project” to mean a use consisting of residential units only, mixed-use developments consisting of residential and nonresidential uses with at least 2/3 of the square footage designated for residential use, and transitional or supportive housing. This bill would clarify, for various purposes of the act, that “housing development project” includes projects that involve no discretionary approvals, projects that involve both discretionary and non-discretionary approvals, and projects that include a proposal to construct a single dwelling unit. The bill would specify that this clarification is declaratory of existing law."
Huh? I challenge you to paraphrase this clarification without getting tongue-tied. Let’s just say the obfuscation is for the benefit of developers, not your average neighbor who thought a Crisis Act might help them during a challenging housing market during a pandemic.
In another example of catering to developers, Senator Skinner is promoting SB 290: Density Bonus Law.League of California Cities, often the go-to source for deciphering a bill, describes it like this:
"Current law requires the amount of a density bonus and the number of incentives or concessions a qualifying developer receives to be pursuant to a certain formula based on the total number of units in the housing development, as specified. This bill would require a unit designated to satisfy the inclusionary zoning requirements of a city or county to be included in the total number of units on which a density bonus and the number of incentives or concessions are based. The bill would require a city or county to grant one incentive or concession for a student housing development project that will include at least 20% of the total units for lower income students."
Huh? Let’s just say we have a right to housing policy written in plain English and understandable to your average, educated adult.
Despite no clear statement about the urgency of SB 290, on February 22, Skinner’s Senate colleagues were persuaded to suspend the California Constitution (Article IV, Sec 8 (a) and Rule 55. The Constitution says:
"At regular sessions no bill other than the budget bill may be heard or acted on by committee or either house until the 31st day after the bill is introduced unless the house dispenses with this requirement by roll call vote entered in the journal, three-fourths of the membership concurring."
Practically, what this means is the bill was fast-tracked, further reducing the time for public scrutiny and comment during the upheaval of the COVID-19 pandemic. It challenges the imagination to give charitable explanation to putting a density bonus law with such muddled explanation on par with the state budget bill.
The Senate isn’t alone in raising red flags about who is served by the plethora of 2021 housing bills. The Assembly has plenty of their own. Two bills (AB 68-Salas; AB 215-Chiu) attempt to force feed inflated Regional Housing Need Allocation (RHNA) numbers to protesting communities up and down the state.
Two bills jump on the density bonus bandwagon championed by Senator Skinner. AB 571 (Mayes) and AB 634 (Carrillo) encourage developers to maintain their standards for investor profits by off-loading expenses to vulnerable cities.
We’re invited to ask, “Why would legislators pass bills that create financial burden for their constituents and the cities in their district in perpetuity, without getting housing that is affordable to truly low-income, on-the-verge-of-homelessness residents? Or asked another way, “Why does the Sacramento housing narrative promote protecting and conceding to the builder/investor/speculators, but abandon sound housing policy that meets the needs of constituents and the common good?"