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Dazed and Confused – California Housing

Posted by: Bob Silvestri - August 13, 2022 - 5:53 PM PDT


The Roman Empire lasted about 500 years and the prevailing socioeconomic system was fairly stable throughout most of that time. From the early 1800s through the early 1900s, generations of Americans made a living doing trades they handed to their sons and their son’s sons. In 1900, there were about 1.5 billion people on the planet. Fifty years later, there were 2.5 billion (a 66% increase). Fifty years after that there were 6 billion (a 140% increase). Today, it’s 7.75 billion.

In the 1950s, the renowned anthropologist, E.T. Hall, observed that when populations of animal species on islands exceeded the environmental capacity of an island, aggression, conflict, intolerance, and socially destructive behavior increased proportionately.

You see where this is going. Things are not like they used to be… and “used to be” is now about 10 years ago. The time of reliable norms is over. Today, everything is changing so rapidly that the majority of our population is still trying to keep up with the changes that happened decades ago (just ask any customer service rep at a tech company helping people use their phone or laptop).

It is unlikely the human psyche is designed to deal with all this.

So, what does this do to our ability to make well-reasoned judgments when the voices of discontent, a good deal of which are driven by this 21st-century phenomena, are increasingly panicked and demanding? At a minimum, it suggests that our decisions should be as fact-based and well-reasoned as possible: which brings us to California’s housing laws.

Overwhelmed?

Today, our society’s challenges seem so complex and interrelated that it leaves the best of us overwhelmed. At the same time, these days, no one believes that government is capable of doing anything to solve our problems except to propose more and more layers of taxes and fees and rules and regulations that only make everything worse. Cynicism is at an all-time high. As such, it’s imperative for government to prove the cynics wrong. But to do that will require entirely new ways of thinking and problem solving by politicians.

This is easier said than done but vitally important because once government reaches a certain critical mass, its collective will can become insurmountable for under-served voices to push against, even if those voices represent the majority of residents. If we haven’t yet reached that point in California, we are certainly getting close. The state’s misguided efforts to address housing affordability are a case in point.

In a recent article on the state’s Regional Housing Needs Assessment (RHNA) process, I noted,

“The State’s unrealistic, dysfunctional housing regulations demand that cities and counties “build” more housing, even though 98% of California’s cities and counties don’t build any housing: never have/never will. But, for all the anti-NIMBY, gavel pounding, and stomping of feet the state’s “trickle-down-the market will solve everything" approach has been an utter failure.”

Yet, despite the government’s failure, politicians are increasingly invested in their dismal approach. I guess this shouldn’t be surprising. Seeing powerful individuals, organizations, nations, and entire empires throughout history show push forward harder with flawed systems, typically comes just before they either collapse or turn autocratic and then collapse afterward.

Bad Ideas Never Lead to Good Results

Let’s assume we agree that it’s in all of our self-interests to have a healthy, well-educated, and securely housed populace because it creates a safer, happier, more productive, and prosperous society. But in today’s world, being able to afford housing means having access to a good education, healthcare, and a living wage job. In other words, when it comes to housing, the state should focus on assisting the poor and disenfranchised, and the “common good,” not pandering to the “market” – a concept that our state’s politicians seem to have completely abandoned.

The absence of such self-evident values is why California’s profits-driven, one-size-fits-all, nonsensical housing policies and the state’s “pulled-out-of-a-hat” housing quotas have not and will not ever succeed. Ironically, however, the power of market forces and the ability to attract private capital for the public good may be exactly what we need to help address our affordable housing challenges.

We just can’t keep doing that the way we’ve been doing it.

Breaking Things Can Just Break Things

Silicon Valley’s favorite mantra is to “move fast and break things.” This is based on the assumption that what comes next is always better. The YIMBYs have embraced this belief to justify tearing down all traditional planning and zoning norms.

But, if you take healthy socioeconomic ecosystems that exist in well-functioning towns, cities, and counties -- where generations have invested their time and hard-earned money to maintain and improve their community, based on their confidence that it is worthwhile to do so because they are building something of value -- and you start undermining that confidence by eviscerating local planning and zoning and the powers of locally elected representation, add threats of lawsuits and financial penalties, add the costs of providing new infrastructure for development that pays no property taxes, and impose unrealistic growth demands on them, then those longstanding, once stable communities become victims of development chaos and displacement, and local government revenue and expense accounting becomes imbalanced to the point that local governments are unable to provide adequate public services for their residents… and the whole socioeconomic ecosystem starts to crumble.

Destroying both sides of a government’s accounting ledger by placing unrealistic financial burdens and penalties on one side, while simultaneously handing over zoning rights to unrestricted, for-profit markets without any requirement that the projects developed serve the public good (e.g., pay property taxes or provide low-income affordable housing) in return, results in the worst of all worlds. One only need look at cities that went bankrupt during the 2008 financial crisis, almost all of which were victims of unsustainable development and the resultant debt, to see evidence of how these dynamics turn out.

Meanwhile, in the process, we’re seeing the erosion of property rights, the right to due process, and the public’s right to mount public ballot initiatives to counteract over-reaching state housing laws.

Don’t Reinvent the Wheel Just Because the Tread is Worn

Another thing legislation-happy California politicians need to learn is that the next “new” thing isn’t necessarily “a good thing” just because it’s new. For example, the creation of yet another state agency, when something similar already exists, makes no sense since it’s usually faster and cheaper to fix what we have than it is to create a new, duplicate version.

A case in point was the recent proposal to create a new housing “super-agency” via Assembly Bill 2053, “The Social Housing Act,” which gratefully died in committee.

According to the Legislative Counsel’s Digest,

“This bill would enact the Social Housing Act and would create the California Housing Authority, as an independent state body, the mission of which would be to produce and acquire social housing developments for the purpose of eliminating the gap between housing production and regional housing needs assessment targets, as specified.”

Translation: Another unaccountable sinkhole for taxpayer funds that adds yet another layer of obstacles and politically correct but practicably worthless regulations.

AB 2053’s super agency would have existed on top of other taxpayer-funded, governmental entities that serve the same purpose: our California public housing authorities (“PHAs”). Their existing “super” agency is called the California Association of Housing Authorities (CAHA). It is a collaborative organization representing PHAs in 72 cities and counties in California: everywhere from small towns like Eureka (population 26,938) to large metropolitan areas like Los Angeles (population 10.2 million).

Consider for a moment that California’s PHAs are;

But, PHAs across the state have been under-funded and grossly neglected for decades. For example, in Marin County, where I live, the Marin County Housing Authority has been technically bankrupt for more than a decade. It has been reduced to processing Section 8 housing vouchers and struggling to maintain mostly substandard apartment buildings, one of which is 300 units and home to over 700 residents, that needs over $80 million in deferred maintenance just to remain habitable.

What would this new agency do that wouldn’t be duplicating the PHAs’ efforts? Wouldn’t it be more logical to just empower existing PHAs with funding and other resources so they can become agents for positive change in their communities? If so, then why would state legislators even consider creating a redundant, new housing super-agency?

Well, first of all, it’s more important to one’s political career to be known for the next “big idea,” than spending your time working in the background trying to actually fix problems that already exist. Secondly, to acknowledge that CAHA’s PHAs are capable of doing everything a new super-agency can do would be tantamount to admitting that one of the reasons California has such an affordable housing problem is because politicians have spent decades neglecting the financial needs of local PHAs. And finally, and probably most importantly, without a new, unelected, housing super agency how will politicians and moneyed interests and political donors be able to cut backroom deals out of the public’s eye?

How you might ask, am I able to make this assertion? Well, consider this.

Recently, the same real estate industry-backed housing "advocacy" groups and "find a popular parade and get in front of it" politicians that want to form a new housing super agency, have been bemoaning the demise of the California State Redevelopment Agencies. They claim that the Supreme Court decision that eliminated these agencies in 2012 laid the groundwork for our housing “crisis” today. But, they conveniently forget that their demise was, as well-stated by Los Angeles County Board of Supervisors Chairman Zev Yaroslavsky, at the time, because over the years the Redevelopment Agencies had,

"…evolved into a honey pot that was tapped to underwrite billions of dollars worth of commercial and other for-profit projects." The projects "had nothing to do with reversing blight, but everything to do with subsidizing private real estate ventures that otherwise made no economic sense.”

The Court, in its ruling, generally agreed with this assessment.

I rest my case.

A Better Way?

Sometimes, when challenges seem too overwhelming, it’s because they are too overwhelming and can’t be solved with neat, simple, sound-byte solutions. The first step, then, is to break complex challenges into simpler parts and address them individually. This has the benefit of making problems more manageable and the solutions to each, in combination with solutions to others, can often result in new synergistic improvements that might not be foreseeable, otherwise.

Putting aside for a moment that our “housing affordability” problems are in fact just a symptom of our society’s “overall unaffordability” problems (which will never be solved by building homes), what are some of the challenges to creating affordable housing that seem too overwhelming to solve and how can we begin to make incremental changes to address them?

Read more...

"Ten Things We Can Do Now to Promote Affordable Housing"

Bob Silvestri is a Marin County resident, the Editor of the Marin Post, and the founder and president of Community Venture Partners, a 501(c)(3) nonprofit community organization funded by individuals and nonprofit donors. Please consider DONATING TO THE MARIN POST AND CVP to enable us to continue to work on behalf of California residents.