Posted on 02/22/2005 12:39:19 PM PST by SmithL
SACRAMENTO - With demand outstripping supply and California housing prices continuing to rise, Arnold Schwarzenegger's administration is preparing a plan to spur home construction that could trigger a statewide battle between developers and environmentalists.
The governor is trying to solve a problem that has scared off his predecessors: How to balance the need for rational regional planning against the demands of small cities for local control. That tension has dominated Bay Area suburban politics for decades and repeatedly led to local balloting on housing development and open space protections.
The time is ripe, said Bill Fulton, an expert on California housing and planning issues who has watched concern swell with the state's home prices.
"I have seen the politics of housing begin to change for the first time in memory," Fulton said. "Now there seems to be a broad constituency promoting housing."
Environmentalists worry the governor will use the housing crunch as justification to gut the state's landmark 35-year-old California Environmental Quality Act (CEQA). Builders have long complained the measure thwarts home construction.
In his State of the State speech last month, the governor promised a plan that "eliminates regulatory and legal hurdles that delay construction and increase the costs of new housing." Few details of the plan, which is due this spring, have been made public.
Meanwhile, the Golden State's housing shortage threatens to hamper its economic growth, forecasters warn.
California ranks 48th of 50 states in home ownership rates -- 59 percent here own, compared with 68 percent nationwide -- and has 19 of the country's 25 metropolitan areas rated as having the least amount of affordable housing.
In the Bay Area, only 13 percent of residents have enough income to purchase a median-priced home, which ran $658,910 in December, the most recent month with statistics available, according to the California Association of Realtors. By that measure, the portion of Californians who can afford a home -- both in the region and across the state -- has fallen to 20-year lows.
State political leaders generally have steered clear of the problem because fixing it requires pleasing widely divergent interests. Builders want to limit challenges to their projects; environmentalists want to enforce urban growth boundaries; city officials often want more housing and better use made of abandoned lots; and many Californians want a home in a community with open space and parks that won't force them to spend a long time commuting to and from work each day.
The California Environmental Quality Act is a key part of the debate. The law requires evaluating the environmental impacts of projects such as housing developments and roads. If a significant effect is expected, a study must be done and measures taken to protect the environment.
Builders gripe that the process can delay projects for years, push up costs and force scaling back on developments, thereby reducing the number of new homes. The law is a weapon for activists who want to block developments, said Tim Coyle, the vice president of government affairs for the California Building Industry Association.
"What's wrong is CEQA, this masterpiece law, is being abused by individuals who don't want any more growth to occur," Coyle said. "It's unfair to take an environmental law and stop the housing."
Environmentalists, though, say builders are taking advantage of the political climate to alter an important and effective law. Environmentalists are open to minor tinkering, such as making it easier to build on infill lots, but oppose "any gutting" of the act, said Bill Allayaud, legislative director for the Sierra Club in California.
A draft of the governor's housing plan shared last summer with representatives of cities, builders and environmental groups called for a major overhaul of the act. It said cities would have "by right" authority to approve projects without the act kicking in, as long as the projects met zoning and general plan guidelines.
Environmentalists contend that would encourage sprawl and largely shut the public out of the process. Today, even if projects meet zoning and planning guidelines, they are reviewed by planning commissions and environmental impacts must be considered.
It's unclear if Schwarzenegger's final plan will include such a provision. Nevertheless, environmentalists considered the draft a bad sign.
"What we're afraid of is they are following the building industry agenda -- supply, supply, supply," Allayaud said.
Administration officials are tight-lipped. Sunne McPeak, Schwarzenegger's secretary of business, transportation and housing, has acknowledged the plan will include changes to the act, but she won't provide specifics.
McPeak said it also will contain a hammer she has long advocated -- a requirement that local governments plan how to accommodate their housing needs for the next two decades. The unanswered questions are: How much flexibility will local officials have to adjust their plans and how aggressive will the state be in enforcing them?
Local officials wonder if the 20-year planning mandate will come with teeth and if it will be accompanied with complementary measures, said Chris McKenzie, the executive director of the League of California Cities.
"It's not good to have a long-term housing plan if you don't have a long-term infrastructure plan," McKenzie said. "We're saying we'll discuss it, but if there is no way to provide services to support the growth, there won't be growth."
Marc Brown, an attorney with California Rural Legal Assistance who has lobbied on housing issues for 23 years, said the reforms being floated by the administration might be too ambitious to fly.
"I'm cautiously hopeful," he said, that "something could get done this year but wouldn't be surprised if things ground to a halt because of a lack of significant consensus over where we ought to be headed."
the population is not going down just up, we need more housing and soon. I love to own a home in my life time
I remember working in Menlo Park with a nice young lady who commuted from LOS BANOS each day. Another guy in the same office had a home in MODESTO. This was in the late 1980s.
Somehow, that concept never bothers liberals when we're talking about illegal immigration. ;)
While that's true, there's no good reason why Silicon Valley employers aren't responding by moving their offices to Los Banos or Modesto. Or Las Vegas, for that matter. As long as California's business community keeps insisting on playing into the corrupt government's hands, they are going to have problems. The environmentalists have already turned much of coastal California into their own private theme park - and Silicon Valley's leaders are right up front, helping them do it.
How Broad minded of him.
Pure coincidence, of course. uh hmmm.
Just because the state's major homebuilders are major donors to his campaigns.. nothing to see here, move along folks.
illegals moving in and citizens moving out...
two and three families moving into single family homes...
and the state keeps digging itself deeper and deeper in debt...
Thanks Ahnold!
As I drive up and down the SF peninsula, I often notice the vast amount of free space west of I-280. I'm not saying that I want to pave over every last square foot of grass and tree baring land, but come on. Run down, two bedroom, 1000 square foot houses are going for $800,000 to $900,000 in SF and the peninsula.
I guess some people like it this way. If you've already got property, restricting new housing construction just keeps the value spiraling upwards. But if you grew up here in a not so well to do family, you are pretty much locked out.
And I'm getting tired of my 325 sq foot apartment :-p
All that open space sits right next to the communities with the highest property values; Palo Alto, San Carlos/Belmont, San Mateo, Hillsborough.
This law is an abomination, and environmentalists should be incensed that its allowed to continue. If you stop the building of housing developments and roads where people would like them, you end up making them live further away, and commuting to where they need to be, and think of the fuel costs and pollution generation by that!
I think that the CEQA ought to be replaced by something simpler. Namely, the property owner gets to decide what happens to the property. If environmentalists want to decide what happens to the property, let them pony up the cash and buy it first!
In essence, we are paying for the program that hurts us. If you are a renter, you are indirectly paying for a program that keeps home ownership from your reach!
I was recently in the central coast area [Santa Barbara and points north] and was struck how the development ceases so suddenly as you head north out of Santa Barbara [and it's true even as far south as Oxnard, where you'll get high density apartment complexes and subdivisions right next to vast, empty spaces]. Did a little research, and came to discover that there is a "law" which prevents the sale of so-called "agricultural" land in quantities of less than 100 acres [I think it's related to the "California Land Conservation Act", also known as the "Williamson Act" and/or the "Agriculture Preserve Program", which gives tax incentives to the landed gentry to keep their property undeveloped].
So you have a phenomenon where really puny, average houses [say, 2500 square feet] are selling for $750,000 [and this is as far north as Lompoc/Vandenberg], and yet right next to them are vast swaths of "agricultural" land that are completely off limits to would-be home builders.
You see it in the prices, as well: The 100+ acre ranches go for about $7500 per acre [i.e. basically $1 million and up], whereas the few remaining "subdivided" [i.e. 10 to 20 acre] lots go for about $25,000-$35,000 per acre [and that's way out in the middle of nowhere]. Unimproved urban acreage goes for astronomical sums [$500,000 to $1 million to $10 million, or more].
The situation is insane, unless, of course, you're a member of the landed gentry, in which case you've already got yours, and you're laughing all the way to the bank. And guess who the landed gentry votes for?
In the meantime, I just can't fathom how ordinary people could possibly afford even a thirty year mortgage on a $750,000 fixer-upper. Back east, those are the kinds of sums that doctors and lawyers and really successful businessmen spend on their houses.
PS: Wasn't the federal constitution supposed to guarantee that
1) Every citizen has a right to enter into contracts without interference from the Congress [Article I, Section 10], andWhen the state forbids you to sell your property as you see fit, then you're not living in a Free Republic.2) Every citizen has at least the same rights [if not greater rights] at the state level [Article IV, Section 4]?
>>Just because the state's major homebuilders are major donors to his campaigns..
Not to mention landlords and beneficiaries of Section 8 housing funds.
It seems to me, enforcing immigration laws and reducing the illegal alien population would result in plenty of affordable housing.
Great post. Welcome to Free Republic. :-)
There is a good reason. If the executives can afford to live in the area, then the commute is no problem. The peons can get there however they may - they had just better be on time.
You are absolutely right, and the powers that be are always trying to obtain more open space, owned by gov. entities. Contra Costa county recently tried to buy more undeveloped land by created a "benefit assessment district" and taxing the county's property owners. Their argument was that more open space in the county would benefit all of the property owners because it is desirable to have that lovely open space. Fortunately, if failed, but only because the larger property owners who would have had to pay the most voted against it, and it was a weighted vote based on how much property you owned.
What so many people don't realize is that when more of the privately owned land is purchased by entities such as counties or regional districts like the East Bay Regional Parks district, that property is taken off the tax roles. Less tax revenue for the taxing bodies, and the tax has to be made up elsewhere, so guess what? More pressure to raise taxes on remaining property and taxpayers in general. Additionally, it costs money to manage and maintain that land. There is plenty of that open space that is not accessible to the public because the district that owns it doesn't have the money to put in the facilities needed, such as parking, trails and public toilets.
Anyone who on a daily basis makes the left so mad.. I support. If only he would become pro-life:).
Stopping development is one of the biggest problems in America. When you fly over America you see open land as far as the eye can see, yet young couple can't afford a home!?!
Its because teh government owns 87% of America.. and on the remaining 13% things are highly regulated. Either by nihilists on the left which hate development.. or by big land owners who want to limit supply.
One reason factories are locating in China is because they can buy enormous amounts of land for next to nothing. Yet China has over 4 times the people per sqaure mile as America! The difference is their government is pro-development right now.
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