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New YIMBY Housing Laws are Coming to a City Near You!
Home/New YIMBY Housing Laws are Coming to a City Near You!
New YIMBY Housing Laws are Coming to a City Near You!Daniel Dobbs2022-12-17T07:43:30-08:00
I have found a post in the SF Examiner “timelining” the state’s plans and the future battles for new “affordable” (higher density) home construction.
The “Sue the Suburbs” movement arose to override local building controls and concentrate decision-making in Sacramento.
Remember, I’m just the Messenger.
I’m a lender, so it’s above my pay grade. I don’t know what “affordable is” is anymore. It’s like “a minor heart attack,” “a friendly divorce,” or ???.
I edited out most of the NorCal data since 95% of my 14k subscribers are SoCal based, but if you click on the headline below, you can read an additional 400 words.
My edited version is a 6–7-minute read; it’s very specific, I promise if you read it, you’ll be the most informed person at your brokerage. I’m here to fund loans while making “YOU look good.” Please call me to pre-qual your buyers.
One by one, a series of more modest housing production laws have passed the state Legislature in recent years, ending SFR zoning and allowing housing to rise in commercial zones.
Within the next few years, all California cities must approve new zoning maps as part of their state-mandated Housing Elements, producing land-use changes as mandated by SB 827.
In cities that fail to produce a state “approved housing plan,” a policy is known as a “builder’s remedy” allows developers to bypass local zoning and approval processes altogether, potentially enabling high-rises to pop up in the affluent suburbs of Silicon Valley and SoCal beach towns.
The ever-deepening housing crisis and the emerging activist movement have helped provide greater political support for reforms.
But the most significant factor behind California’s quiet housing policy revolution has been a handful of highly technical bills and administrative changes that make it much more difficult for cities to say “no” to housing.
Toothless Laws
Many state laws behind the recent housing policy revolution have been on the books for decades. In 1969, the Legislature passed the Housing Element law, requiring cities to plan for enough housing to keep up with population growth over seven or eight years.
In 1977, the state passed the Permit Streamlining Act, capping the time it takes for cities to issue new development permits.
In 1982, lawmakers approved the Housing Accountability Act, requiring cities to OK new home developments consistent with current zoning. But city governments acted as if they were free to violate these and other housing laws and flagrantly denied permits.
Though no official state laws enshrined local control, it was the norm that individual cities would have total authority over what was built within their borders.
In 2014, Cupertino City Council members admitted in a public hearing that they intended to fool state regulators by planning for housing in a place “where it’s not going to get built.”
Many other cities also treated their Housing Elements as “an elaborate shell game,” in the words of a Foster City council member, planning for affordable housing in cemeteries, creeks, and other unrealistic locations.
That started to change in the middle of the last decade. Housing had become so costly that it was becoming a top political concern in polls.
Middle-class young people began organizing under the banner of the YIMBY movement, using activism to show how a lack of housing made it harder for everyone to afford a home.
Housing Bills
SB 827 was no ordinary piece of legislation. In one fell swoop, the bill sought to upend the urban planning ethos of the prior half-century.
It challenged numerous tenets of conventional wisdom: that cars and single-family homes are the basic building blocks of California cities, that environmentalism requires halting development, and that cities and neighborhoods always know what’s best for the collective good.
In recent memory, local and national media gave the bills more press coverage than any other state legislation. In Sacramento, SB 827 “took all the oxygen up in the room,” said Ben Metcalf, head of Calif.’s Dept. of Housing and Community Development from 2015 to 2019.
The Most Significant was SB 828,
Math-heavy SB 828 changed how the state calculates city housing construction goals. The new formula it imposed considers the historic under-production of housing, the share of overcrowded households, and other unique criteria.
Following SB 828’s passage, cities and counties saw dramatic increases in the allocation of the number of homes they must plan for their new Housing Elements, which will guide planning between now and the early 2030s.
The Bay Area’s housing allocation more than doubled compared to the previous cycle, and SoCal’s allocation had more than tripled.
By all accounts, most state legislators, local governments, and housing advocates had no idea how big of an impact SB 828 would have. Metcalf said. “It was cryptic, and most people were not paying attention to it.”
What is the ”Builder’s Remedy”
As cities began working on their new Housing Elements over the two years, the impact of SB 828 started to sink in. The law was a profound change in and of itself, but it also made other laws more potent.
This “constellation” of newly effective laws put cities in a vice they’ve never been in before. While SB 828 ratcheted the number of homes cities had to plan for, other bills passed the previous year forced cities to follow through on their mandates.
One such bill required housing to be planned on “realistic sites” — (no more creeks or cemeteries) — and another bill gave the Dept. of Housing and Community Development the power to reject a city’s Housing Element if it failed to do so, to involve the CA Attorney General if necessary.
Once a city’s Housing Element is rejected, that city loses access to specific affordable housing funds and becomes vulnerable to a policy known as the “builder’s remedy.”
A little-known provision of the Housing Accountability Act, the builder’s remedy allows developers to bypass local zoning and approval processes altogether as long as their project conforms to building safety codes and provides at least 20% of units at below-market rates.
The never-before-used policy is being tested in SoCal, where more than 100 cities failed to produce a compliant Housing Element.
Santa Monica, for example, saw 16 builder’s remedy applications when the policy was eligible to be invoked earlier this year, totaling over 4,500 units, roughly equivalent to the total number of homes the city has permitted in the last two decades.
Bay Area cities, have until January 31 to produce a compliant Housing Element, after which point they could face a similar fate.
In other words, cities must either provide a realistic plan for allowing a lot more housing development or lose the authority to say no to new housing construction altogether.
First under Gov. Brown and then under Newsom, the state has dramatically expanded its Housing and Community Development Dept. Between 2016 and 2022, the department’s overall headcount has more than doubled, and its policy staff has gone from 16 people to 129 people.
These groups have a symbiotic relationship with state regulators: YIMBY Law founder Sonja Trauss essentially “rediscovered’ the Housing Accountability Act when she filed a lawsuit against Lafayette. CA. in 2015, sparking the “sue the suburbs” movement.
Two years later, East Bay state Senator Nancy Skinner authored a bill that forces cities to pay fines and reimburse their opponents’ legal fees if they lose a case under the Housing Accountability Act, giving cities a strong financial incentive not to block zoning-compliant projects.
“That enforcement piece is the linchpin,” Fryman said.
Theory vs. Practice
Utill, how well these housing laws work in practice remains to be seen. Construction costs are very high, which is a barrier to new development.
“In a world in which it’s expensive to build, period, it means even if you have a lot of permissively zoned lots, it’s still tough to find (projects) that pencil,” Metcalf said.
The Courts Will Decide
Cities have historically found loopholes in housing law and will likely continue to do so. For instance, Santa Monica’s City Council has pledged to fight its builder’s remedy projects.
The courts ultimately have to decide how many of California’s recent housing laws are implemented.
While the court ponders how the laws will be enforced; the state has had a “laser focus around processes to streamline market-rate development,” like reducing permitting times, eliminating the possibility of lawsuits, and increasing allowable density for new development.
Note: “Watch this space,” as these skirmishers are just a prelude to the next step for control of California housing.
