User:Yifu6/California housing shortage

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2022 Legislative session[edit]

In September 2022, Newsom signed a package of housing bills, including AB 2011, SB 6 and AB 2097.

AB 2011 Considerations with Affordable Housing[edit]

Although this policy will expedite the project approval process, requiring prevailing wage poses a major problem for 100% affordable housing developments (where all units are income restricted). The requirement of prevailing wages leads to complication in financing development, as prevailing wage potentially raises construction costs by up to 40%. This increase creates obstacles for the financial feasibility of affordable housing developments, as affordable housing financing is far more complex than market-rate housing. Funding involves hard loans from banks accompanied by multiple state and municipal grants, all of which are difficult to qualify for and obtain as there are many affordable housing developers competing for the same funds. When construction requires an affordable housing developer to pay prevailing wages, it becomes even more strenuous to finance the construction cost increase. This is because receiving funding awards from public subsidies is competitive and affordable housing developments generate a low rental cashflow every year because they charge low rents; hence, they are unable to support a larger loan payment. The requirement of prevailing wage for construction can potentially mean that the development is financially infeasible, and the affordable development may not move forward or may not proceed with approval under AB 2011.

SB 6 and AB 2097[edit]

SB 6 allows for residential use on commercially zoned property without requiring a rezoning, as long as a percentage of construction workers hired are unionized. AB 2097 removes parking minimums for homes and commercial properties within one mile of public transit stations or in neighborhoods with low rates of car use. California became the second state after Oregon to eliminate parking minimums near public transit.

2023 Legislative Session

In October 2023, Newsom signed another package of housing bills. Notable bills include SB 4, SB 423, and SB 555.

SB 4

SB 4 makes it so that religious institutions or higher education institutions can submit applications for streamlined approval for building housing on their lands, granted that it satisfied criteria and that all of the units are made available for lower-income households. The bill is part of a greater movement by faith communities in the U.S. to build affordable housing called "Yes, In God's Backyard." The movement has, in the past, struggled with getting past the red tape over adaptive reuse of their property, especially with city or local opposition. SB 4 is part of a series of California bill efforts since 2020 to make it easier for churches, as well as other faith communities and higher education institutions, to build on their lands, including an assembly bill (AB 1851) which reduced or eliminated parking requirements for such projects. For California, the possibilities of what can be built using this law is not limited: statistics of church real estate show that there is quite a lot of church property in Oakland and Berkeley which could provide a substantial amount of land to build more housing on.

SB 423

SB 423 comes as an extension of SB 35, a bill that expedites processes for housing developments in areas with higher needs. Such need is assessed using Regional Housing Needs Assessment (RHNA), which was part of what was written into law in SB 35. SB 423 specifically expands the streamlining outlined in SB 35 by allowing the state to supersede the local government in passing the review and to make it easier for multifamily developments in coastal zones. This is a victory for pro-housing advocates, as the California Coastal Commission has been a major source of opposition to housing developments on the coast. Opponents are concerned about the housing threatening the local beach environment and wildlife. Pro-housing advocates argue that housing must be built everywhere, but the coast provides an especially good opportunity as it is nearer to jobs, recreation, and less car-centric living, which ultimately means less pollution. Beyond advocates and opponents, the commission itself historically has blocked almost all housing on the coastal zones, with the consequence being even higher housing prices than in other areas.

SB 555

The introduction of SB 555 indicates a shift in housing priorities, turning away from solely the private rental market or homeownership to explore alternative forms of tenure. The bill introduces a plan to implement 1.4 million units of social housing, which is permanently kept from the private market and being bought out. This provides protections for renters and hopes to create a subsection of housing that is not based on speculation and instead creates secure mixed-income communities. The bill first mandates that its department of housing (HCD) completes a California Social Housing Study completed by the end of 2026, which will create recommendations and analysis on social housing and what the best options for the state are.

Other efforts[edit]

Since 2014, several YIMBY (Yes In My Back Yard) groups have been created in the San Francisco Bay Area. These groups lobby both locally and in Sacramento for increased housing production at all price levels, as well as using California's Housing Accountability Act ("the anti-NIMBY law")  to sue cities when they attempt to block or downsize housing development. One activist, in a comment to the San Francisco Planning Commission supporting the construction of a new 75-unit mostly market rate housing development stated that: "The 100 or so higher income people, who are not going to live in this project if it isn't built, are going to live somewhere...They will just displace someone somewhere else, because demand doesn't disappear."