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Briefing for the Millennial Housing Commission |
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June 5, 2001 |
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Oakland, California |
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50 years of continuous growth - 10 million every
generation. |
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The nation’s
most progressive housing requirements matched against the nation’s
most complicated, costly, and risky entitlement process. Guess which wins? |
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Extraordinarily costly development inputs.
Business of housing production dominated by large, innovation-averse
builders. |
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Homeownership is an essential part of the
California dream, yet state homeownership rate is 10% below national
average. |
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Still plenty of appropriate land for housing
construction (infill & greenfield) yet paralyzed by sprawl fears. |
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Need Estimates |
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Sources of the Problem |
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Federal, and State Funding Responses |
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Policy Suggestions |
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Raising the Roof (HCD, 2000; from 1995 AHS) |
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Currently about 2.4 million California
households need some form of housing assistance (are low-income and are
over-paying). |
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If that percentage stays constant at 22%, the
number of households needing housing assistance could rise to 3.7 million
by 2020. |
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Still Locked Out (California Budget Project,
March 2001, from 1999 AHS) |
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Statewide, 2.3 low-income renter households per
affordable unit, or a shortage of 581,000 units. |
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About half of California renters pay more than
30% of their income for rent |
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90% of low-income renters “overpay” for rent |
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79% of low-income home-owners overpay. |
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Growth, Growth, and More Growth |
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Planning Disconnect Between Jobs and Housing |
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CEQA and the Rise of Permitting over Planning |
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Unfavorable Economics of Mid-Market Apartment
Construction |
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The “Impossibility” of Infill/Refill |
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Local Annexation Policies and General Plans that
are Blind to Future Growth |
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Density and Housing Disincentives |
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Homebuilder Myopia/Lack of Built-in Neighborhood
Value |
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Uncoordinated Approaches to Providing Low-Income
Housing and Assisting Low-Income Households |
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This “triple whammy” of population growth,
escalating rents, and a declining affordable housing stock will put further
strain on an already over-stressed system, and turn what is currently a
large housing needs gap into a vast canyon. |
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Raising the Roof, p 138. |
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Either affordable housing is a matter of
statewide importance or it isn’t.
If it is, “business as usual” shouldn’t be the norm. |
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Land use and regulatory reforms (“sticks”) |
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Incentives for good behavior (“carrots”) |
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Piggyback federal subsidy programs |
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Ramp-up state and local subsidy programs |
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Reform the local planning and permitting process
to expand the supply of market-rate and moderate income housing to check
and (gasp!) maybe even reverse future rent and price increases. |
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Promote increased infill, especially land
recycling. |
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Increase state bond funding for affordable
housing. |
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Increase local funding for affordable housing,
particularly RDA funding. |
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Where appropriate establish and expand
affordable ownership programs. |
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Make Section 8 vouchers an entitlement for all
households with less than 50% AMI. Fund 5 year Section 8 commitments. Make
them completely transportable within MSAs. |
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Increase HOME funding and target to high cost
states. |
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Allocate LIHTC to states based on size of
population in need rather than population. |
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Continue HOPE VI. The mixed-income model works. |
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Push Fannie Mae and Freddie Mac on the
multi-family side. |
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Federal innovation grants for housing
construction of housing on infill & recyclable lands. |
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Matching housing /supportive services block
grants from HHS. |
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Increased bond financing to more aggressively reward SF and MF
infill development (e.g., help pay for infrastructure upgrading) |
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Take the lead in identifying and conserving
environmentally sensitive lands. |
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Planning assistance funds for local specific
planning, infill housing planning, and 20-year capital improvements
planning. |
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Strengthen housing element law to require more
explicit identification of future development sites in land use element. |
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State over-ride laws requiring UGBs to include
20-year land supplies (evaluated at recent densities); and eliminating use
of fiscal impact criteria for rejecting housing projects in jurisdictions
with large outstanding housing needs. |
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Increase housing redevelopment set-aside
requirement to 40%, and allow TIF use for residential area parking and
traffic improvements. |
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State HOME program to match local housing trust
funds |
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State law requiring 20% inclusionary units (80%
or lower AMI) in jurisdictions with very low (e.g., 3% or less) vacancy
rates. |
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We can’t continue to rely on periodic economic
downturns to restore housing affordability. |
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Over-payment, over-commuting, and over-crowding can
get worse. |
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High market-rate housing prices do ultimately
feed-back into the economy, adversely affecting economic growth. |
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Failure to act will result in the emergence of
two classes of Californians: homeowners and “permanent renters.” |
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