California State Senator Scott Wiener’s SB 827, to relax local restrictions on housing adjacent to transit, is a revolutionary step in the history of California land use. The initial version of the bill was clearly an opening salvo, reflecting a general statewide principle that locals should no longer squash housing in prime transit areas.
So it was inevitable that the legislative process would chip away at this broad framework, sometimes for good (recognizing that context matters in a state as large and diverse as California and that some changes might actually improve implementation and achievement of the larger goals) — and sometimes for bad (appeasing key legislators who don’t care much about building new housing near transit, to get their votes).
And now the first significant round of amendments were just introduced last night as the bill faces its first committee hearing and vote, with the promise of potentially another dozen rounds of amendments as SB 827 works its way through Capitol hearing rooms.
Below is the rundown on amendments, as Senator Wiener outlined in an accompanying Medium post. I’ll start with the good (or at least not horrible) and end with the unfortunate.
Good or Harmless Amendments:
- No net loss of affordable or rent-controlled housing provision: if a developer seeks to use SB 827 to build on a site with rent-controlled or subsidized affordable housing, the developer must replace each of these units with a permanently affordable housing unit on a 1:1 basis. This is a good provision because a loss of low-income residents near transit is not only unfortunate for those residents, it undermines transit usage. Low-income residents tend to use transit more than upper-income people. So we don’t want a situation where 30 low-income residents are replaced by 30 affluent residents under the bill. Otherwise, there could be a net loss in transit ridership and usage.
- Scale back qualifying bus stops: in its original form, SB 827 would apply equally to rail transit stops and any bus stop with 15-minute headways during commute hours. The provision might have been too generous, as many bus stops may have those headways during commute times but otherwise don’t provide enough service to truly allow car-free living for those nearby. The amendments now make the bill apply only to transit stops that have “consistent, high-quality transit during the week and on weekends, from early morning to late night.” Specifically, they must have at least 20 minute average service intervals between 6am and 10pm and 30 minute intervals on weekends from 8am to 10pm. The upside is that we won’t be building a lot of homes near transit stops that don’t really provide sufficient service to allow car-free living (or at least significantly reduced car trips).
- New residential percentage thresholds: any project under SB 827 must now be at least two-thirds residential by square footage.
The Not Terrible Amendments:
- Restriction on demolitions: a developer could not use SB 827 to demolish a building if the properties have had an Ellis Act eviction (kicking rent-controlled people out of their units with legal justification) recorded in the last five years. This provision provides an additional disincentive for property owners to evict rent-controlled residents, beyond what’s already in the bill. As with the “no net loss” provision, it might reduce the chances of displacement of low-income residents.
- Scale back relaxation of parking minimums: high parking requirements are a major disincentive to more dense development and essentially a tax on all homebuyers and renters. One of my favorite parts of the bill was that it eliminated parking requirements for any project within .5 mile of transit. But the new amendments allow cities to impose a .5 parking spot requirement per new residential unit in the .25 to .5 mile zone around transit. A developer must also provide recurring monthly transit passes to all residents at no cost. I don’t love the scaling back of the parking provision, but .5 in this outer radius is still a win. It mirrors the big parking victory under AB 744 (Chau, 2015), sponsored by the Council of Infill Builders, which reduced parking minimums to .5 for all affordable housing projects near transit, including in the 0-.25 mile zone that SB 827 relaxes completely. I’ll file this change as “not terrible” for now, barring any future weakening.
The Unfortunate Amendments:
- Lower height restrictions: the original bill allowed construction up to 85 feet within .25 miles of transit, under certain conditions. Now, around rail and ferry stations, only buildings up to 55’ tall can be permitted in the first .25 mile and 45’ in the second .25 mile zone. Furthermore, no building height increase will take place around any qualifying bus lines. The one upside is that parking and density restrictions will still be relaxed. For me, reducing the height limits means fewer units will be built, which is too bad. But if I had to give on either density, parking or height, I would probably give up on height, among the three. Density relaxations can help make up for many of the lost units that would have been built in the upper stories.
- Requirements to include affordable housing: it was pretty clear that SB 827 would have to include some kind of affordable housing mandate to pass, and here it is. If a community does not have a local “inclusionary housing” requirement (i.e. mandate for any market-rate developer to include some affordable units), the amendments offer a detailed set of options for developers to comply, ranging from 20% inclusionary if it’s a 50+ unit building to 10% low income or 5% very low income for 10-25 units. I don’t like inclusionary zoning because it’s a tax on new homebuyers and renters and not an equitable way to fund affordable units. It also depresses home production. A more equitable way to build affordable housing is through property taxes or broad-based taxes or bonds. But as far as things go, this isn’t a horrible formula.
- Delay of implementation by 2 years: SB 827 was set to go into effect this coming January 1st, if it passes. Now the operative date is two years later on January 1, 2021. A local government can also apply for a one-time, one-year extension if they can “prove to the Housing and Community Development Department that they have made significant good-faith progress.” The argument in favor is that local governments will have more time to “conduct studies, update inclusionary housing ordinances, and adopt specific transit oriented development plans.” Cities also won’t be able to use the time though to reduce or eliminate residential zoning to avoid SB 827 requirements. I don’t like the delay for two reasons: first, we need to get going on new home building right away, and local compliance with SB 827 really shouldn’t be that complicated. Second, I worry this gives opponents time to figure out a counter-strategy, or at least delay other needed measures to boost housing under the guise of “let’s see what happens in 3 years when SB 827 is finally in effect.”
Overall, a half a loaf is better than no loaf, and SB 827 is still a no-doubt landmark bill, even with these changes. The big worry is what happens in future rounds as more legislators require appeasement for their votes. But advocates can cross that bridge when they come to it. The main thing at this point is ensuring that there are still bridges to cross, with a worthy bill. And these amendments keep that effort going with only some loss and even some gain.
The great California housing debate over SB 827 (Wiener) has mostly been depressing to witness. The bill would essentially upzone areas adjacent to major transit, leading to badly needed housing production mostly in our affluent and transit-rich areas that can support more expensive multifamily construction.
Riding to the rescue of anti-growth affluent communities have been various advocacy groups focused on or allied with low-income tenants. These advocates mistakenly assume that the upzoning will lead to a building boom in low-income areas and contribute to gentrification and displacement. In reality, the upzoning will encourage development in high-rent areas and reduce pressure on displacement and gentrification overall.
So it was somewhat refreshing to see an advocacy group actually engage with the substance of SB 827, rather than react ideologically against it. TransForm has been focused on bolstering smarter land use around transit since it originally formed as the awkwardly named Transportation and Land Use Coalition (TALC) over 20 years ago. SB 827 in many ways should be the organization’s dream bill, as it seeks to reverse the exclusionary, low-density housing policies that have created the environmental and economic mess that California now finds itself in.
But TransForm is not entirely pleased with the bill. Their concerns revolve around preventing displacement of low-income residents, adding more affordable housing, and engendering a backlash against infill. In a blog post, they recommend:
- Value capture to increase affordable housing stock, likely through a requirement that a certain percentage of homes built under the bill be affordable (scaled to the size of the project)
- Stronger, enforceable renter protections, such as through ensuring no net loss of affordable housing in transit station areas
- More inclusive conversations about potential improvements
- Greater sensitivity to local context, such as different height limits on different land use types
- Consider “Missing Middle” housing types for low-density neighborhoods, such as designs that get over 80 units per acre with 25- to 30-foot buildings
- Place a maximum unit size on developments to avoid vertical McMansions
- Refine criteria for transit capacity, with different requirements for zoning based on transit types — BART, light rail, bus rapid transit, ferry, etc.
- Ensuring traffic and climate benefits by avoiding traffic congestion through parking maximums, providing on-site transportation amenities for residents, and maximizing affordability
- A clearer understanding of the bill’s geography and impact
Some of their recommendations are relatively harmless, such as a more inclusive process (which is what the legislative process is usually all about anyway) and better mapping. Some seem likely to engender the backlash they fear, such as parking maximums. And some seem overly fear-based, such as the need to “protect” single-family home neighborhoods to avoid a backlash — as if there isn’t already a big backlash against any new development.
In particular, it’s worth looking at differentiating land use requirements in the bill based on transit capacity, as well as increasing the enforceability of anti-displacement measures.
But TransForm should acknowledge that efforts to require more affordable housing through inclusionary zoning, even just in upscale areas, are essentially a tax on new housing to pay for more affordable units. This tax will depress housing production overall and put the burden of subsidizing affordable housing on new home buyers, rather than on existing homeowners who benefit from the status quo. Density bonuses would make more sense to boost affordable housing supply, as well as funding these units through increased taxes on current homeowners.
Still, it’s nice to see some substantive critiques from a land use advocacy group, particularly given how unproductive the nonprofit sector has generally been when it comes to finding actual solutions to the housing shortage. We’ll have to stay tuned to see if any of these recommendations make it into the bill.
The regional housing shortage in the San Francisco Bay Area is hitting students hard. A surprising number of them are homeless, unable to afford a place to live.
In response, Berkeley city councilmember Kriss Worthington is proposing a plan to allow 6,000 new units for UC Berkeley students, centered around the transit-rich area along Telegraph Avenue near the campus.
KTVU News covered the proposal on Sunday and interviewed me, the councilmember and a student:
Many Berkeley residents and elected officials there have become notoriously hostile to new development, so this proposal may be controversial. But it’s badly needed to increase housing opportunities for students. And perhaps as the students find these new homes, it will reduce demand for surrounding housing for long-term residents, achieving a win for all.
I’ll be on KQED radio’s Forum this morning at 10am discussing SB 827 (Wiener) to relax local restrictions on transit-oriented housing. We’ll discuss what the bill might mean for California’s cities, environment and economy.
Please tune in at 88.5 FM in the San Francisco Bay Area and weigh in with your questions. Even if you don’t live in the Bay Area, you can stream it live.
Joe DiStefano at the Urban Footprint blog ran a useful experiment to see how the transit-oriented upzoning proposed in SB 827 would affect three station neighborhoods in the San Francisco Bay Area’s BART system. All three stations are in the East Bay but are somewhat distinct:
- Orinda is a low-density suburban commercial and residential stop
- Rockridge is a medium-density, largely suburban stop
- MacArthur is a more urbanized commercial stop
The analysis included an assessment of what housing units are currently built in the 1/2 mile radius of the stop, how much capacity would be legal to build under current zoning, what would happen if only commercial areas were rezoned and not single-family homes and townhomes, and what would happen if the full upzoning allowed under SB 827 took place.
Here are the results (apologies for the blurry screengrab — check out the site for a better image):
The bottom line is that under SB 827, potentially 48,000 additional new units could be built, just within 1/2 mile of these 3 station areas. It demonstrates the power of upzoning near transit to build enough housing to accommodate future population growth and stabilize prices for existing residents.
And even if single-family homes and townhomes didn’t redevelop (either because the owners didn’t sell or the bill eventually gets amended to prevent development there), the state could still see over 10,000 new units in the “modified upzone” scenario — again, just at 3 station neighborhoods.
Caveats are of course necessary: not all of these units would be built, even under the full scenario. Property owners wouldn’t sell in some cases, developers wouldn’t maximize density and height on all lots, other local restrictions may prevent some of the units from getting built, and the final bill may contain additional restrictions that would limit a full build-out.
But this analysis indicates the power of upzoning near transit to help solve California’s dire housing shortage. Given the importance of this issue to California’s environmental and economic health, solutions like SB 827 are well in order, as this analysis shows.
We know that city dwellers have a smaller carbon footprint that suburbanites. But now we have a real case study with carbon measurements to document the phenomenon.
14 scientists at the National Center for Atmospheric Research, the University of Utah and several other universities set up a network of carbon dioxide sensors across Salt Lake City and its suburbs. The Washington Post reported on the results:
As suburbs have expanded southwest of Salt Lake City over the last 10 years, carbon dioxide emissions have spiked…
It’s the latest indication that suburban expansion takes an environmental toll, with people driving greater distances and building larger homes that use more energy for heating and cooling.
Similar population growth in the center of Salt Lake City didn’t take the same toll, according to the research. Carbon dioxide emissions in the city center were already higher than in nonurban places. But as the population there grew by 10,000 people, the emissions didn’t increase further.
It’s yet more evidence that encouraging urban growth is one of the most important steps we can take to reduce greenhouse gas emissions. And it’s also a reason why supposedly “environmental” organizations like Sierra Club California that oppose pro-infill measures like SB 827 are actually damaging the environment by doing so.
2017 was the beginning of a state effort in California to finally address the severe housing shortage here. 2018 promises to be even bigger, with more bills proposed that are finally starting to tackle some of the core causes of the shortage.
Friday at 12:30pm the San Francisco nonprofit SPUR (San Francisco Bay Area Planning and Urban Research Association) will host a free hour-long panel discussion on what to expect this year in statewide housing policy. We’ll cover SB 827, CEQA, affordable housing, tenant protection, and more.
Joining me on the panel will be:
- Brian Hanlon / California YIMBY
- Catherine Bracy / TechEquity Collaborative
The location is:
SPUR Urban Center
654 Mission Street
San Francisco, CA 94105-4015
Unlike SPUR gatherings later in every month, there’s no charge for this first-of-the-month event. Hope to see you there!
Google made headlines recently for buying a huge property adjacent to the future downtown San Jose high speed rail station, per the San Francisco Chronicle:
Google has been in negotiations with San Jose since June for a planned “village” that would feature up to 6 million square feet of office, research and development, retail and amenity space near San Jose’s Diridon Station. The development could bring 15,000 to 20,000 jobs, Nanci Klein, San Jose’s assistant director of economic development, previously told The Chronicle.
To be sure, this property would be valuable for Google even without high speed rail, as it’s at the heart of San Jose’s light rail network. But high speed rail will only increase the value, as it would give Google employees high-speed train access to businesses to the south and through the San Joaquin Valley — and eventually Los Angeles.
So the question is: would a property owner like Google be willing to help finance high speed rail, which is badly in need of cash? It’s the old school way of funding trains: leverage the future increases in property values around the stations to finance the transportation.
Given the slow trickle of state dollars and nonexistent federal funds, high speed rail leaders will need to get creative about how to find money to keep construction going. A large company like Google could greatly help with the search.
Back in 2008, and then again in 2016, transit advocates in Los Angeles came together to get county residents to fork over $160 billion over 30 years in new sales taxes revenue for transportation investments. A sizeable chunk of that money goes to major transit capital projects, including new rail and bus rapid transit lines.
They successfully secured approval for these tax hikes with 2/3 voter support. But now transit ridership is plummeting in Los Angeles. It’s a nationwide phenomenon, but it’s particularly severe in L.A. While there a few ways to counter-act these trends, the most proven and sensible one is to boost transit-oriented development of all types.
Yet given recent public debate on SB 827, which would upzone residential areas within a few blocks of major transit stops, it’s clear that many of these advocates are not committed to the land use changes necessary to achieve this density. Despite SB 827’s promise to accomplish the very increase in residential density needed to support transit, they remain opposed.
So who are the culprits? Most prominently, Los Angeles mayor Eric Garcetti (who championed the 2016 measure) still refuses to support SB 827, despite the recent amendments to address his legitimate displacement concerns. Instead, he stated concern for the area’s single-family homeowners, professing a desire to “protect” these mostly affluent residents from mid-rise apartment buildings near major transit.
And it gets worse. Move LA, the organization that has probably done the most to launch these voter sales tax measures, actually came out against the bill in a joint letter with various community groups. This opposition comes after their executive director Denny Zane already helped sink a major transit-oriented project near an Expo Line station that would have added more than 400 hundred badly needed homes in the area, including 50 affordable units. His main concern at the time was too much car traffic.
Even Sierra Club California used the fear of these land use changes in SB 827 as a reason not to support the measure. Specifically, the organization wants to see a new rail transit line in Sacramento, even though the line will be a massive money-loser without more density around the stations.
Based on these transit advocates’ arguments, it seems clear that many are only focused on one thing: building new transit lines. They don’t seem to care how cost-effective they are, and in many cases they actively don’t want to see much new development around the stations — especially not market-rate housing, and especially not in “quiet” affluent areas that are benefiting financially from these publicly funded investments.
So despite SB 827 being one of the most important pro-transit measures put forth by the legislature in recent years, some key transit advocates seem unlikely to join a coalition in support.
It’s a disheartening — though clarifying — turn of events. What it means is that the help to save transit agencies from plummeting ridership may not come from advocates for expanding new lines. It will instead come from those who favor more density of homes near transit in general, which is apparently a distinct cause for many in the “transit advocacy” community.
Some opponents of SB 827 (Wiener) — to essentially upzone residential areas adjacent to major transit stops — simply reject the idea of any new housing in their neighborhoods. Others are generally hostile to new market-rate development. But besides those non-helpful objections, the one compelling knock on the SB 827 approach is that the new residential development it would unleash could displace low-income renters.
There’s a clear moral objection to that happening. With the housing shortage and jobs boom leading to high home prices and rents everywhere, low-income residents of rent-controlled units will basically have no place affordable to go if they’re displaced. The bill shouldn’t force some of the most economically insecure and impoverished among us out of their homes.
And displacement also potentially undermines one of the key purposes of the bill: to boost transit ridership. Low-income people are more likely to use transit than higher-income people. So replacing them with market-rate renters or owners could be a loss for the nearby transit system.
That said, I do believe the concern is overstated, as low-income neighborhoods are not likely to be a prime target of developers risking capital on expensive multi-family buildings and needing a high return to justify the expense.
But still, we knew anti-displacement measures in SB 827 were coming, and yesterday Sen. Wiener introduced them. They essentially boil down to two things:
1) Explicit recognition that SB 827 does not preempt local policies preventing demolition of rent-controlled units or displacement of those tenants or requiring affordable units to be built with market-rate ones. This recognition is probably not needed legally, but it’s a handy reminder to critics that SB 827 takes nothing away from locals on the issues of affordability and displacement.
2) Making it expensive to displace residents of rent-controlled units.
This second approach is where the amendments get interesting. Basically, if any SB 827 project displaces these residents, the developer must honor a “Right to Remain Guarantee.” As Sen. Wiener explains in a blog post:
[The guarantee] must, at minimum, provide all of the following, at the developer’s expense:
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All moving expenses for a tenants moving into, and out of, an interim unit in the area while the project is being built.
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Up to 42 months of rental assistance that covers the full rent of an available, comparable unit in the area.
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Right of first refusal for housing units in the new building, and offered with a new lease at the rent previously enjoyed by the tenant in their demolished unit.
So displacement could still happen, but only at significant expense and with displaced residents being “made whole” by the process. It’s essentially a quasi-market-based approach to discouraging displacement. It will incentivize developers to seek to redevelop properties that don’t have rent-controlled units on them to avoid these costs.
In addition, a separate amendment requires a local jurisdiction to adopt a demolition process for rent-controlled units if they don’t already have one, for any SB 827 project to occur.
It remains to be seen whether anti-displacement critics of the bill will be mollified by this approach. But I do think these changes make the bill stronger, without conceding too much of the market-rate development we still need for residents of all incomes in our state.
