The 2 Reasons California’s YIMBY Reforms Are Failing
Happy Tuesday! This week’s Rent Free includes:
- An Ohio Church countersues the city criminally charging its pastor with zoning violations.
- Vancouver, British Columbia, approves another indigenous-owned megaproject.
- A new report shows that America’s housing affordability problems are getting worse and spreading to more areas of the country.
But first, our lead story on the one California zoning reform that’s working out really well, and why all the others haven’t been nearly as productive.
Why Is California’s Building Boom Limited to ADUs?
California YIMBY, one of the OG YIMBY groups that advocate for zoning reform in California, has released a new report heralding the building boom kicked off by an accessory dwelling unit (ADU) reform.
Since the California Legislature got serious about eliminating local restrictions on granny flats, in-law suites, and the like in 2016, ADU production has increased by 15,000 percent. In 2022, they made up a quarter of California’s housing production, according to the report.
It’s truly a YIMBY success story. The sad fact is that it might be California’s only major YIMBY success story.
Since 2016, the California Legislature has passed dozens of bills that remove regulatory barriers to housing production. And since 2016, overall housing production has increased only modestly, according to permitting data from the state Department of Housing and Community Development (HCD). When ADUs are subtracted from the mix, permitting activity has more or less flatlined.
The state is permitting about as much housing today as it was in the 1990s, and much less than it was in the 1980s or early 2000s, according to U.S. Census Bureau numbers. (It is at least producing more than the recession-ravaged early 2010s.)
Meanwhile, indicators of the state’s housing shortage—including the ratio of rents and home prices to incomes, the percentage of cost-burdened households, measures of housing underproduction, and homelessness rates—are all flashing red.
So, what’s going on? Why haven’t other YIMBY housing laws kicked off a boom in new duplexes and transit-adjacent apartments as they have with ADUs?
I’d boil it down to two basic problems. Firstly, many YIMBY reforms have focused on handing down better bureaucratic mandates to local governments who have no interest in reforming their own housing laws. Secondly, the Legislature lards down what could be productive housing laws with endless interest group carveouts and handouts.
State Orders, Local Controls
On paper, California does have an elaborate, decades-old system requiring local governments to plan for more housing called Regional Housing Needs Assessment (RHNA).
The state hands down housing production goals to localities. Localities then produce plans called housing elements to meet those goals. Housing elements identify sites where new housing will be allowed, and outline the regulatory “constraints” on new construction localities will eliminate.
For a long time, RHNA was kind of a joke. A major focus of YIMBY reforms has been on improving the once-useless system.
New laws try to make state production goals reflect actual market demand, and ensure housing elements more realistically plan for growth. State bureaucrats more closely vet local housing elements. New state enforcement units are putting pressure on local governments to follow through with removing regulatory constraints.
The hope is that a souped-up RHNA will make all of California’s local governments more accommodating of new housing.
RHNA’s approach is premised on the idea that localities won’t do this on their own. The problem is even a souped-up RHNA still leaves them in the driver’s seat.
The state might review and certify housing elements, but localities are still the ones responsible for writing them, implementing them, and then approving individual housing projects. That leaves plenty of wiggle room for localities to loosen constraints on housing construction on paper while maintaining them in practice.
The state can theoretically strip localities out of “substantial compliance” with state housing law of state grants, force them to allow “builder’s remedy” projects, or even petition a court to rewrite their housing element.
For all the excitement about “builder’s remedy” projects, none have actually been approved. Local governments have proven pretty adept at blocking them or forcing the developer to settle for a smaller project.
Outside the few communities purposefully thumbing their nose at the state, there’s also a lot of legal uncertainty about when jurisdictions are actually out of “substantial compliance” with state housing law and thus subject to state remedies.
San Francisco was arguably still substantially compliant with state housing law last year when it was dragging its feet on passing reforms the state was telling the city it needed to adopt in order to meet its RHNA goals.
If the remedies for floating RHNA don’t clearly apply to San Francisco—the subject of a scathing state audit finding the city takes ov
Article from Reason.com
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