Local elected leaders are acutely aware of the severity of California’s housing affordability crisis and our role in fashioning solutions. That’s why city leaders are actively involved in efforts to develop policy reforms that can create a blueprint for more housing construction.
In recent weeks, academics, state officials and elected officials have offered opinions and potential solutions to increase housing supply. Many have been critical of local governments for the lack of construction in our communities. Some of these criticisms are fair, but many ignore the realities of the private housing market, the limited resources for affordable housing and the conditions that encourage or discourage new housing development.
Let’s start with what cities can do. While local governments do not build homes, cities are responsible for planning and land-use decisions that allow housing to be built. Local government housing elements are updated every eight years and reviewed by the Department of Housing. All building permits must be processed in accordance with the Permit Streamlining Act; the Housing Accountability Act prohibits denials of housing consistent with these local plans.
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But more can be done to streamline housing and environmental reviews. One challenge local developers face is complying with the California Environmental Quality Act, which can be lengthy and create delays and uncertainty. Toward that end, the League of California Cities is promoting legislation to support city efforts to conduct all environmental reviews upfront in order to streamline housing approvals and boost construction.
As proposed, these plans would focus on affordable housing in areas close to jobs and transit, and conform to California’s greenhouse gas reduction laws. A revolving loan fund would help cities finance these upfront plans and environmental reviews with the additional costs recovered from fees when the units are built. This approach could drastically streamline housing approvals and create a blueprint to more housing construction.
The state must also lead by example. The league supports Senate Bill 3 by Jim Beall, D-San Jose, which would put a $3 billion affordable housing bond on the ballot, and Senate Bill 2 by Toni Atkins, D-San Diego, which would generate hundreds of millions of dollars each year for affordable housing, emergency shelters and other housing needs.
The state should also reward communities approving housing with incentives to help offset the reality that property taxes generated by affordable housing are often insufficient to cover the cost of the supporting infrastructure.
It is important to recognize, however, that free-market forces largely dictate housing location and cost. In the Bay Area, with less available land, the red-hot job market is driving prices higher. Conversely, in areas like the Central Valley and Inland Empire, cities have set the table for development and even approved projects, but developers remain cautious.
State laws – including those dictating building standards, energy efficiency, greenhouse gas emissions, stormwater, taxes and other laws – also add costs to housing and affect the financial viability of projects.
It is time to have a more realistic discussion of all the forces at work that affect the housing market. Cities already have to plan extensively for housing needs and process applications within strict time frames. The league’s upfront planning proposal will help further streamline development projects, without sacrificing public input and environmental reviews. Still, the state also needs to do its part and provide real funding to support local efforts and affordable housing.
There is much that we can do together in partnership this year to create a blueprint for more housing construction. The League of California Cities and its member cities stand ready to be part of responsible solutions.
Carolyn Coleman is executive director of the League of California Cities. She can be contacted at email@example.com.