SLO County exceeded its state housing goal — by building a glut of unaffordable homes

After 50 years, California’s overarching housing law needs a major overhaul. Better yet, scrap it altogether, because we need to shake up a broken system.

The Housing Element Act requires every city and county in California to zone for all types of residential growth. Each agency is given a targeted number of units to plan for, in various income categories, based on forecasts from the state Department of Finance.

The process is supposed to ensure Californians of every income level — from minimum-wage earners to millionaires — will be able to find housing they can afford.

It hasn’t worked. Today, the housing shortage is the worst it’s been in recent history.

Take a look at San Luis Obispo County, recently ranked by USA Today as the fifth least affordable housing market in the nation.

Unincorporated SLO County managed to exceed its overall target for number of building permits issued by the end of 2017 — even though its current planning cycle doesn’t end until June 2019.

If state law worked as intended, increasing the supply of housing should have helped with affordability. Except here’s how the county did it: by more than doubling its target number of market-rate homes for wealthier buyers. Low-income housing starts were much lower.

That’s happening in several jurisdictions; too much land is being paved over for high-end homes, squeezing out more affordable units..

The state should be using its clout to require cities and counties to concentrate on zoning for apartments, condos. duplexes and tiny homes, instead of standing by while jurisdictions continue the same pattern of approving luxury developments for the rich.

Building constraints

There are other inherent weaknesses in the Housing Element Act.

For one, it assumes that as long as there’s a need for housing, builders will build.


Land prices and/or interest rates may be too high; the economy too weak; a jurisdiction may have a reputation for being anti-development; or the timing may be wrong for a particular type of home.

Another problem: The law assumes there are unlimited resources to support growth.

There are not. In California, water is particularly scarce, yet the state does not view that as a valid excuse for limiting residential growth.

“If a jurisdiction is in control of the water ... the jurisdiction is expected to go out and secure more water resources,” said James Worthley, a planner with the San Luis Obispo Council of Government.

That’s unrealistic. And dangerous. Does the state really want to push cities to the brink of running out of water?

Yet there’s a fine balance: Some jurisdictions will avoid seeking out new water supplies or expanding sewer capacity to avoid growth.

A good housing policy would find a way to police that.

Reward building, not just zoning

The Legislature and the Governor’s Office have been working to hold cities and counties more accountable for producing low-income housing; a slew of laws recently took effect that make it harder for agencies to ignore state housing mandates.

One of the more controversial is the strengthening of the Housing Accountability Act — often called the anti-NIMBY act — which subjects agencies to hefty fines if they arbitrarily deny affordable housing projects.

Another law requires agencies to identify additional low-income housing sites when market-rate housing is built in a spot that had been earmarked for affordable homes.

In the most controversial move of all, Gov. Gavin Newsom has proposed withholding gas tax money from jurisdictions that block home building, though after a strong backlash he agreed to delay that for four years.

But punishing communities that don’t comply with zoning doesn’t go far enough.

The state also needs to nudge local agencies to play bigger roles in funding and facilitating affordable housing.

San Luis Obispo County, for example, recently revamped its affordable housing fee to exempt smaller homes, while using a sliding scale to determine fees for large homes, based on their size. That could generate up to $1 million per year — money that nonprofit housing organizations could leverage to help ease the county’s affordable housing drought.

As much as cities and counties like to point out that they aren’t in the home-building business — and therefore can’t be held accountable for housing shortages — there are government programs and policies that can spur residential construction, especially of lower-income housing.

Cities and counties that do succeed in increasing their inventories of lower-cost homes should be rewarded by the state with more housing revenue — a move Newsom is proposing.

That’s a start.

It makes far more sense to reward agencies for producing homes people can actually live in, rather than judging success based on acreage set aside for hypothetical housing that may never be built.

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