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“You can’t push a river" - California's Housing Element process is a bust
A reporter left me a message the other day, wanting to get my opinion of the Housing Element process. From his voicemail, I could tell he was out to write a story about those standing in the way of the state’s wonderful housing laws. Unfortunately, there really aren’t many “reporters” in mainstream media anymore: just a lot of people out to propagate black-and-white tales of good and evil with naively simplistic endings and looking for characters to cast as heroes and villains in California’s current “build-baby-build” and damn-the-torpedoes narrative.
My short answer to his question, though, is that the entire Housing Element process, which began decades ago as a simple statistical gauge of the housing industry in California, is now to the point of being futile. The reason is simple: 97% of California cities and counties don’t build any housing, never have, never will, affordable or otherwise, so how can the state legitimately penalize them for something they have no control over? Or are we now in a world where one has to genuflect and pledge loyalty to moneyed interests when making public housing policy decisions, particularly when those interests have little interest or even ability to provide affordable housing?
It appears so.
California state housing policy is hopelessly lost in the sauce
The Housing Element, backed by a growing list of new state housing laws, has turned public housing policy into a draconian bludgeon to pave the way for unfettered, private, for-profit developers to claim the "builder's remedy" and rule the roost, cherry-picking which laws they want to follow and which ones they’ll simply ignore, and for greedy investment bankers to have more housing derivatives to sell to yield-starved clients, and to benefit of large trades unions seeking to drive private, entrepreneurial, cost-competitive contractors out of the workplace.
Similarly, the Housing Element “certification” process is nothing more than a mandatory bowing down to trickle-down economics, the impacts of which will be endless regressive taxes and fees, the hollowing out of public services, and, ultimately, local government bankruptcies as the costs to support the needs of more residents overwhelm local revenue sources.
As such, the Housing Element process is destined to fail.
We are undoubtedly heading into a prolonged period of subpar economic growth, higher interest rates, and lower investment returns than we’ve experienced in the last decades, mostly due to the unsustainable public and private debt bubble we will all have to shoulder or suffer the impacts of one way or another. This will make achieving adequate returns on investment in affordable housing development much more challenging.
Add to that the enormous financial burdens on our cities and counties as they attempt to pay for the costs of providing adequate infrastructure (roads, sewers, water, etc.) and public services (police and fire protection, schools, social services, parks, etc.) to accommodate new housing development (particularly low-income housing development that will be exempt from paying any property taxes) and to maintain services for existing residents.
All this is happening at a time when it is increasingly expensive for municipalities to refinance existing short-term debt or take on new long-term debt, and the costs of staff salaries, healthcare, and benefits are also rising and returns on pension plan assets are far below projections, creating unfunded liabilities that are reaching onerous proportions for many municipalities.
The cumulative impacts of these circumstances should not be underestimated.
The "top-down" debacle rolls on
The state is in no better financial shape. As recently as a year ago, our Governor was bragging about California’s largess and how we could afford our own Medicare-like healthcare system. Today, we are barreling headlong into deepening deficits.
But worst of all, though not discussed, is the detrimental emotional and psychological effects state housing policy is having on millions of California homeowners who have spent lifetimes working, saving, and investing their time and money and emotional resources in their neighborhoods, their communities, their schools, and local institutions, who are now feeling betrayed as the state pulls the rug out from under the social contract they thought was assured when they made those investments and commitment to their communities: We participate in and support local government and it will make decisions in our best interests, in return, e.g., not let a 30-story building throw our meager backyards into perpetual shadows or clog our streets with cars because the new projects aren’t required to provide parking.
Progressive ideologues will dismiss this a privileged whining but a sense of cohesion and community and unity of purpose is much more fundamentally important and is, in fact, enjoyed and relied on in all communities, rich or poor.
In a recent article by Dulcie Ruttley-Dornan and Sean Bradley, the authors write;
"The concept of governance is closely
linked to social cohesion and the sense of ownership that individuals
have over their respective parts of the city. Community-led
decision-making plays an essential role in this. The intention is for
residents and their representatives to manage their communities and
foster supportive relationships, which are fundamental qualities for a
community dealing with change."
Do we desperately need to address inequality and dramatic unaffordability challenges in California? Absolutely. But not like this.
The proof is in the outcomes. California housing policy has unarguably failed to produce any significant amount of affordable housing for those most in need. This is because of a public policy approach using “shame and blame” politics and because the state continues to fail to deny the socioeconomic realities we are facing or invest in empowering local governments to originate sustainable solutions.
That said, consider this graph about “Housing Affordability Hits Record Lows,” by RIA. It indicates that housing affordability is now at a 40-year low (this index only began to collect data in 1986, so it might be longer than that).
Against the current global, national, and statewide economic backdrop it is simply impossible for California’s housing policies or the Housing Element process to have any effect other than to destroy decades of irreplaceable community building while affordability in all its forms will remain a mirage on the horizon.
We need to try something new..
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 all California residents.