The SF City Economist report on city's housing-element rezone is a nice bookend to the Court of Appeal's decision last month in New Commune v. Redondo Beach.
Put them together, and it's clear that pretty drastic reforms to CA's Housing Element Law are in order.
Crux of New Commune: If city does fact-intensive, site-specific analysis of "realistic" capacity for new housing, any frustrated YIMBY can dredge up an existing lease, go to court, and get the judge to put the city in Builder's Remedy penalty box.
/2
Import of S.F. City Economist report (together w/ HCD's correspondence w/ city thus far): If city instead uses p(dev) method to gauge its plan's capacity, city will be at mercy of the inexpert model gods at HCD.
Who knows what model they'll bless?
/3
I increasingly think the Leg should radically simplify HCD review of housing elements.
By doing so, Leg can provide more certainty to cities and free HCD staff to work on other stuff, like SB 79 implementation & enforcement letters on contested projects.
/4
The simplification I envision:
- HCD would issue a workhorse p(dev) model that all cities would use to gauge their plans' capacity
- Leg would end HCD's review of HE analysis of "constraints" (despite my having written a too-long paper calling for more & better of it...)
/5
In lieu of constraints analysis in housing elements, Leg would revive the old Least Cost Zoning Law.
Specifically, on housing element sites, ***cities would have to allow development, at a density & FAR specified in HE, at "least cost" consistent w/ health/safety***
/6
This means: no impact fees, no IZ, no local building code amendments, no unit-mix requirements, no transfer taxes, no design standards (beyond a bare minimum specified by state, e.g., for streets/sidewalks), and no discretionary review.
/7
Cities would have broad leeway to try to persuade developers to build something more to city's liking. Tools of persuasion: local density-bonus ordinances, discretionary rezonings, tax rebates, etc.
But on the HE sites, developer would always have a true "least cost" option.
/8
Leg would also:
- End HCD's subjective review of AFFH analysis & programs.
Instead, there'd be a clear-cut AFFH rule, like requiring 10% or 20% of land in every school district to be zoned for mixed-income housing at Mullin densities.
- Let cities pool their land-use authority for housing-element purposes. (Like the French consolidated planning units studied by @ClemenceTricaud.)
/10
- By delegating their housing-element responsibilities to a multi-city body, city councils would gain some insulation against the wrath of their most NIMBY constituents.
- Pooling would also let the most housing-intolerant jurisdictions discreetly shift some of their RHNA allocation to more tolerant places. Not as an explicit trade, but rather a collective decision about where new housing would "work best" for the cities as a group.
/12
- And pooling would probably save cities money (a helpful rationalization, vis-a-vis the most NIMBY constituents)
Tricaud's study finds that forced consolidations of French local governments for land-use purposes increased housing production.
/13
In sum:
A housing-element would consist of a spreadsheet of sites, w/ FAR & density specified for each. That's all.
Scoring of the spreadsheet would be formulaic.
City councils could adopt their own spreadsheet or delegate it to their COG or some other multi-city body.
/14
Procedurally, any big reform to the housing-element process would probably have to follow the path cleared by @GavinNewsom for CEQA reform.
Run the bill through subject-matter committees in one house, then roll the bill into the budget.
/15
That's a very different process than what @California_HCD has done in the past, namely, to convene "stakeholder working groups" to hash out consensus bills.
/16
A stakeholder-consensus process is unlikely to get the job done -- at least, not if the reform is supposed to make life easier for cities & get a lot of housing built.
/17
Some of the stuff that key stakeholders want -- higher IZ mandates, more hooks to sue cities, attorneys fees -- is simply incompatible with legal certainty for cities & clear paths to build lots of housing at low cost.
/18
The legacy of the stakeholder-consensus process is a Housing Element Law that's truly awesome for suing cities. (See: New Commune)
But the wholesale outsourcing of planning to NGO lawyers is not a great path forward for California....
/end
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New decision from CA Court of Appeal on the fee-shifting provisions of AB 1633 has big implications for NIMBYs' incentive to challenge housing approvals under CEQA & beyond.
Context: As part of the 1970s revolution in admin law, states & the federal gov't actively encouraged self-appointed "private attorneys general" to sue, via attorneys' fee bounties.
/2
Asymmetric fee-shifting provisions were written into scores of public laws: If a plaintiff challenging a gov't decision wins, the gov't has to pay for the plaintiff's attorney; if the plaintiff loses, they don't have to pay for the gov's attorney.
"For a typical mid-rise apartment in San José, construction costs can exceed $700k–$900k per unit."
I 💯% agree w/ @MattMahanSJ that reducing construction costs should be a top priority for 2026 -- and that this is mainly a job for the state legislature.
Reason #1. CA's fiscal constitution + local political incentives push local govs to extract "value" from development w/ impact fees, IZ & transfer taxes.
This drives up the cost of building enormously.
/2
The state leg should preempt most such fees, IZ, & taxes, ***and create a substitute source of local revenue.***
My preferred alternative: a state parcel tax assessed on the "net potential square feet" or "net potential units" created by upzoning pursuant to state law.
/3
Could L.A. really land in the Builder's Remedy penalty box, just for f'ing around with a single low-income housing project which a nonprofit developer wants to build on city-owned land?
In October, @California_HCD sent L.A. a sharply worded letter, warning that the city's housing element had relied on the Venice Dell project both as a "pipeline project" and as part of the city's strategy to "affirmatively further fair housing."
/2 hcd.ca.gov/sites/default/…
The HCD letter also flagged five "policies" and two "programs" in L.A.'s housing element that per HCD should "facilitate the project."
The city's course of action has been "inconsistent with these policies."
Cooking in San Diego: A turquoise, 23-story test of the Permit Streamlining Act's new-and-improved "deemed approved" proviso.
This could turn into a big constitutional battle.
🧵/22
Enacted in 1977, the PSA put time limits on CEQA and other agency reviews of development proposals.
If an agency violated the time limits, the project was to be "deemed approved" by operation of law. Wow!
It proved wholly ineffectual.
/2
As @TDuncheon & I explained, courts first decided that the Leg couldn't possibly have meant for a project to be approved before enviro review was complete.
- San Francisco almost certainly must approve this 25-story project on a site zoned for 4 stories
- The city's new ordinance deregulating density in "well-resourced areas" will operate as de-facto downzoning of such sites
🧵
This project's site is zoned for retail use and is currently occupied by the Marina Safeway.
The zoning classification also allows residential use at density of 1 unit per 600 sqft of lot area or density of nearest residential district, whichever is greater.
/2
The nearest residential district, RM-4, allows density of 1 unit per 200 sqft of lot area.
That translates into 567 units on site.
Developer proposes to build 790 units, which requires a 39% density bonus (790/567 = 1.39).
By describing the credible commitment problem (the need to reassure developers of new housing or energy that their project won't face price controls for a very long time) I didn't mean to imply, as some critics on the right insist, that the problem is insurmountable.
/2
I think the problem can be greatly mitigated:
1. By offering DC-style "certificates of assurance" to developers, i.e., recordable contracts for compensation if the project is subjected to price controls within a defined period of time.
/3