Builder's Remedy: San Fransokyo, Part Deux (Electric Boogaloo)

February 2, 2023 12:12 AM

Bay Area Cities To Lose ALL Housing Zoning Powers [today; thread] - "Old law proposes to turn the Bay Area's zoning system into something like Japan's in just two days."[1,2,3,4,5] (previously)

• @California_HCD: "Yes, 1/31/23 was the due date for all ABAG (Bay Area) jurisdictions to have a compliant, adopted housing element."
• @Yimby_Law: "Good morning, Bay Area. According to our evaluations, 69 of your 109 local jurisdictions are now subject to the builder's remedy."
• @CSElmendorf: "Today's the deadline for Bay Area cities to adopt their housing element. A 🧵 on what comes next."
• @CSElmendorf: "Some people are asking whether cities face the builder's remedy if they adopted their housing element by the deadline (yesterday, in Bay Area) but didn't get it certified by HCD by deadline. This one has an easy answer."
• @CSElmendorf: "Cities that took their housing elements seriously (like SF) should be steamed by cities that are using the 'self-certification' gambit in hopes of avoiding builder's remedy."
• @markasaurus: "Happy Zoning Holiday to all those who celebrate California cities' loss of control over their own land use! Let me know if you'd like to file a builder's remedy project this month."

also btw...

• @henryzcohen: "America built one (1) non-car dependent city, it became the center of our cultural and financial aspirations, and than we proceeded to never make one again."
• @plannerdanzack: "Your point is excellent and 100% spot on! I might say it this way instead, though: 'America built thousands of non-car dependent cities, destroyed all but one, it became the center of our cultural and financial aspirations, and than we proceeded to never make one again.'"
• @jmhorp: "The rise of the suburbs and the decline of downtown as a residential space was not due to cars, zoning, or race riots. It preceded all those by several decades. The reason is more mundane: downtown land values increased because businesses discovered agglomeration benefits."
• @culturaltutor: "Why did the USA do this to its cities?"
• @dbroockman:

1978: SF NIMBYs downzone SF, banning 180,000 potential homes Less than a decade ago: the YIMBY movement is born in SF[6] This week: the SF BOS voted to make over *HALF A MILLION* new homes legal, counteracting the '78 downzoning by >3x Thank you @Scott_Wiener: "SF Board of Supervisors is poised today to approve a strong housing plan (housing element) that plans for 82k new homes in next 8 years: 3x the # of homes planned for in the last plan. This transformative moment didn’t happen randomly. We changed state law to MAKE it happen..."[7]

• @alex_lee: "Today, I've reintroduced Social Housing as #AB309 more exciting updates to come soon..."
• @ArmandDoma: "new social housing bill text just dropped..."
• @cityplannerd: "Costco, typically known for giant buildings full of bulk goods surrounded by massive parking lots, is working on a deal in the Baldwin Hills neighborhood of Los Angeles that would put apartments full of potential customers on top of a planned store."
• @Noahpinion: "Nice! Now allow stores on the first floor of 5over1s all across America!"
• @YIMBY_Princeton: "Mixed-use, transit-oriented development in Westfield NJ that was vociferously opposed by local NIMBYs advances...love to see it!"[8]
• The High Cost of Expensive Housing (and How Auckland Fixed it) [thread] - "Why housing is so expensive in the developed world."[9]

The economics of high housing costs are very well documented. They are mainly caused because of restrictive housing regulations that limit the supply of housing. Zoning restrictiveness is strong predictor of housing costs, and it explains much of the variation in prices The high cost of expensive housing is that it makes everyone poorer! If fewer people move to San Francisco, that's lesser startups for everyone. If fewer people move to Oxbridge, that's lesser biotech companies for everyone (and so on). High housing costs reduce hurt *everyone*, by limiting output in high productivity cities. Hsieh and Moretti estimate that if New York and SF didn't have their strict zoning laws, the average American would be about 3% richer! These effects are much higher for the average renter and homebuyer in these cities of course. But does it actually work? Auckland reduced regulations for zoning in 2016, and that is a good test of our theory. First, it led to higher housing construction in upzoned areas which increased supply. Second, it led to lower prices in Auckland relative to the rest of NZ!

• @Tesho13: "Density creates affordability..."
• Actually, Japan has changed a lot - "Japan's fervor for constant scrap-and-build construction is a major reason why rent there is so affordable, and why local politics haven't halted dense development as they have in the West."

Wingfield-Hayes opens his article[10] by complaining that Japanese houses tend to depreciate instead of appreciate:

In Japan, houses are like cars. As soon as you move in, your new home is worth less than what you paid for it and after you've finished paying off your mortgage in 40 years, it is worth almost nothing. It bewildered me when I first moved here as a correspondent for the BBC - 10 years on, as I prepared to leave, it was still the same.

Weirdly, this is presented as a chronic problem — something Japan should have fixed long ago, but hasn’t. But in reality, depreciating real estate is one of Japan’s biggest strengths. Because Japanese people don’t use their houses as their nest eggs, as they do in much of the West, there is not nearly as much NIMBYism in Japan — people don’t fight tooth and nail to prevent any local development that they worry might reduce their property values, because their property values are going to zero anyway. As a result, Japanese cities like Tokyo have managed to build enough housing to make housing costs fall, even as people continued to stream from the countryside into the city. If you think Japan is stagnant, consider this comparison between Tokyo and some leading Western cities... Even more amazingly, Japan managed all of this while increasing the size of the average person’s home... In the bubble era that Wingfield-Hayes pines for, Japanese urban apartments were widely derided as “rabbit hutches”, but four decades later their floor space per person is similar to European standards and higher than in the UK. Why does Wingfield-Hayes think depreciating housing is a problem? Perhaps he believes this means the Japanese middle class is unable to build wealth. But when property tends to depreciate, it means that houses don’t cost as much to buy in the first place; that lower price frees up household cash that can be put into stocks and bonds. Basing wealth on productive assets instead of unproductive land is good for the economy — housing scarcity might pump up prices and build individual wealth for homeowners, but at the national level it simply holds back economic growth.[11] And as it turns out, it’s good for middle-class wealth as well — in 2022, Japan’s median wealth per adult was about $120,000, compared to around $93,000 in the U.S. (And this is despite the fact that Japan’s once-legendary household savings rate has collapsed!) So Japan’s somewhat unusual choice not to tie middle-class wealth to housing prices seems like a smart one. Over the past two decades, the country has done better in terms of housing policy, construction, landscaping and urbanism than just about any country in the West. And it did this by embracing constant change rather than the physical stagnation that has prevailed in Western cities.[12]

posted by kliuless (32 comments total)

Wow. What?!

My first reaction was "wait, but where are all their kids going to go to school??" and I figured I would be able to find an answer to that, but I wasn't. One assumes families will live in these developments. Where are their kids going to go to school? Where are they going to drive and park the cars they will definitely still need? How will any of this work? This is going to be mayhem and I'm excited to watch it from 1000 miles away, having already divested my Santa Monica real estate holdings some years back lol
posted by potrzebie at 12:39 AM on February 2, 2023

> The “builder’s remedy” is a very old law from the 1990s

My wizened and ancient body is crumbling into dust right this moment
posted by vibratory manner of working at 1:48 AM on February 2, 2023 [67 favorites]

WRT where the kids will go to school, I think it's a better problem to have then the one the state has had for a long time now which is "we created lots of businesses, but where will the workers live?" So many cities in the bay area have been happy to zone and build corporate office complexes while not allowing any new housing. Still a problem certainly, and child care and education is in its own crisis, but this is pretty great.
posted by vibratory manner of working at 1:58 AM on February 2, 2023 [7 favorites]

This is fantastic.

I was biking along the bike path after one of the recent atmospheric rivers had just come through, and some folks are regrading it, just enough to diver the culvert a bit so it won't drown a tent. By the end of the day, that tent is up, and it won't be soggy that night. A precarious bit of stability, but it's something. A few days later, they shut down the path to do another sweep, as they so frequently do. Sweeps won't fix anything.

There are over a quarter of a million people who are homeless in California. It breaks my heart.

Housing. YIMFBY. Yes.

Santa Monica: 1600 homes approved in eight years. In a WEEK, 4000 new homes approved, 800 of which are affordable housing. There are 85 cities bigger than Santa Monica in California, and after the Bay Area, the rest of California is up for review next year.

This is going to change a lot of lives.
posted by aniola at 2:09 AM on February 2, 2023 [19 favorites]

This sounds a lot like Massachusetts 40B which does create affordable housing but has been abused by enough bad actors to provide cover for those who oppose it. (i.e. everyone has an anecdote about a greedy developer gaming the system or threatening to 40B a project that wasn't originally proposed with affordable units if the town didn't give them exactly what they wanted.)

The state has recently taken a more direct approach with new legislation mandating that every town served by the MBTA needs to zone a minimum number of high density lots in proximity to transit. No excuses--the towns have to do it. I think this is a much better way of achieving more affordable housing than offering developers a quick get-out-of-local-zoning-free card to play.
posted by RonButNotStupid at 5:26 AM on February 2, 2023 [6 favorites]

One assumes families will live in these developments. Where are their kids going to go to school? Where are they going to drive and park the cars they will definitely still need?

One thing to keep in mind is that those problems already exist because of zoning restrictions and prop 13: California had great schools until the 1970s when courts ruled that white people had to share them and they responded by burning it all down (every California school I sent to was crumbling due to that unwillingness to pay for infrastructure their kids no longer needed).

Zoning rules kept density down but that also means that many areas had excess capacity once the original wave of kids got older (parents don’t downsize when prop 13 means it’ll cost them a fortune), while other areas didn’t have the revenue since old property owners (especially landlords) reliably chose not to fund anything they didn’t use. Each new resident will be paying more in taxes than their neighbors, and demographically they’re more likely to vote for additional necessary reforms.

This change removes some barriers but it doesn’t mean huge developments are popping up overnight, or that they’re going to be continuing the sprawl California can no longer afford. Cities can build bike and transit infrastructure very quickly if they choose and every redevelopment replacing old, low-density housing with something better reduces the number of trips someone needs a car to make. That’s better for everyone, especially the older people increasingly isolated after it’s no longer safe for them to drive.
posted by adamsc at 6:17 AM on February 2, 2023 [8 favorites]

"wait, but where are all their kids going to go to school??"

If necessary, in new or expanded schools built with the fees and property tax brought in by new development.

And, as with other infrastructure, I'd expect there to be economies of scale and density, so if anything this tends to bring down the per capita cost of services.

As I understand the process, somenoe estimates likely new student population brought in by new developments and this is used by school systems to plan growth. The same goes for other infrastructure--e.g. the water department is going to look at the new development and figure out how to service and negotiate any necessary fees and improvements.

This doesn't completely bypass the planning process. Just the (transparently discriminatory) rules that say "you must buy a lot of minimum size X to live in this neighborhood".
posted by bfields at 6:18 AM on February 2, 2023 [2 favorites]

I had been thinking about doing a NIMBY/YIMBY post for a while. Glad to see this! I am also glad to see dense housing proposed on top of Costcos.

The “where will they go to school” is a total red herring. Public school enrollment is has been in decline for years. New construction does come with fees to fund schools. When I added a new master bedroom to my house I literally had to walk a check down to the school district office before the city would grant my permit.

“Yes but traffic” is the other red herring. The Bay Area (and southern Ca) opposition to housing while adding thousands of jobs has lead to folks with 50 plus mile commutes. That adds way more traffic and pollution than by a new apartment building in your city.
posted by CostcoCultist at 7:09 AM on February 2, 2023 [20 favorites]

As I understand the process, somenoe estimates likely new student population brought in by new developments and this is used by school systems to plan growth.

This is true - most school districts have a programmed capacity, which is the number of class rooms at a particular school multiplied by the max number of students per classroom.

Then they also have functional capacity, which is the number of people their demographer estimates is going to be enrolled, and the extra capacity. In my district, they use 85% of program capacity to determine functional capacity, but some may use different numbers. Schools actually run into real problems at the margins, ie: too few students involves firing a teacher or too many people means hiring for a particular grade.

Decreasing number of students is actually a much bigger problem, as people generally have fewer kids now, more go to private, home, or parochial schools, and zoning limits the number of potential rooms for students (ie: the majority of apartments are 1-2 bedroom).
posted by The_Vegetables at 8:47 AM on February 2, 2023

So many cities in the bay area have been happy to zone and build corporate office complexes while not allowing any new housing.

Blame Prop 13. San Jose for example for decades deliberately set itself up as place to house workers; when Prop 13 came in, it rapidly meant that that housing was a tax sink instead of providing enough taxes to fund the amenities it used.
posted by tavella at 8:52 AM on February 2, 2023 [3 favorites]

Glad to see this! I am also glad to see dense housing proposed on top of Costcos.

I had trouble parsing that sentence in the article, too. But I think what they're saying is that cities were proposing dense housing be zoned in places where they figured the existing big box stores would never be torn down. In an effort to get around the spirit of whatever rule they were obliged to follow.
posted by aniola at 9:11 AM on February 2, 2023

No, they literally mean housing built on top of Costcos as has been recently proposed in LA.

While it's true a lot of cities have missed the deadline, it's not at all clear that we'll soon see a bunch of new housing built via Builder's Remedy. The courts will get involved, and it'll take a while to resolve. Here's a good article going into some depth about what might happen next here in Berkeley.
posted by Frayed Knot at 9:21 AM on February 2, 2023 [3 favorites]

Costco in 2015: we should only build where there is dense housing for people who make 100k annual and above (ie luxury condos+)

Costco today: we should build luxury condos on our roof
posted by paimapi at 9:50 AM on February 2, 2023 [5 favorites]

SF Bay Area school districts have been long experiencing a decline, to the point where schools are being closed. That's what happens when the average home price is well over a million dollars and few new families are moving in.

Some Silicon Valley areas do not even raise enough money to fund their schools properly, requiring the state of California to help them out: Why do Silicon Valley schools have so little money per child?
posted by meowzilla at 10:04 AM on February 2, 2023

The rich enclave of Woodside (average home price: > $5 million) last year claimed that the entire city was a mountain lion refuge in order to avoid approving new housing.
posted by meowzilla at 10:16 AM on February 2, 2023

They made that claim, yes. But the HCD rejected it.
posted by Frayed Knot at 10:31 AM on February 2, 2023 [2 favorites]

I'm sure that there are lovely, caring people in Atherton--including Warriors basketball player Steph Curry (charitable foundation). But none of those people were at the city council meeting last Tuesday.

As a Silicon Valley renter in a moderately dense suburban townhouse near a bus line and a light rail station, I try to take a balanced approach to the housing disaster in the S.F. Bay Area.

I think I've reached the point where I can say...fuck these people. They just can't make any sort of shared community sacrifice for anyone who is not them. There is no plan or compromise that they would appear to agree with, other than no housing at all. Where is the human empathy? I've completely lost patience with the endless lawsuits and the parade of tearful objections to most of the needed housing construction here.

I think that no reasonable person could look at the Bay Area's housing and see a fair or sustainable system. It's a complex problem with many nuanced solutions, but the time is long past to move forward.

They can sail their yacht to Belvedere or drive the Maserati to Los Altos Hills, if Atherton is too crowded with affordable apartments. How much more can these people be catered to? Do they want to participate in society, or not?
posted by JDC8 at 11:07 AM on February 2, 2023 [9 favorites]

when Prop 13 came in, it rapidly meant that that housing was a tax sink instead of providing enough taxes to fund the amenities it used.

Low density single family and semi detached homes aren't self funding anywhere in the USA, prop 13 just made it worse.
posted by Mitheral at 11:31 AM on February 2, 2023 [4 favorites]

No, they literally mean housing built on top of Costcos as has been recently proposed in LA.

This Costco in Vancouver was built in 2006; it has four apartment towers on the roof with 900 units total. If you look around from there, to the left at the end of the block (with pointy 'masts' holding the roof up) is the football/soccer stadium, the depressing blank wall behind you is the hockey arena (the apartment tower with a curved facade is part of the arena development). To the right of the Costco entrance is a viaduct with a road and a cycle track; the second viaduct is the SkyTrain system, which has a stop just out of view, next door to the store entrance. Urbanist Brent Toderian lives in the area, and calls Costco "the convenience store".
posted by Superilla at 11:40 AM on February 2, 2023 [3 favorites]

My first reaction was "wait, but where are all their kids going to go to school??"

Well, for one, Oakland is closing schools because there aren't enough students. Statewide school enrollment has been declining the last five years.

I think this is a much better way of achieving more affordable housing than offering developers a quick get-out-of-local-zoning-free card to play.

"Builder's remedy" requires that the new development have at least 20% low-income or 100% moderate-income units. If they are playing, affordable housing is non-negotiable.
posted by oneirodynia at 2:06 PM on February 2, 2023 [1 favorite]

Santa Monica pre-2023 approved 1,600 homes, 551 of them below-market rate, over 8 years. Now Santa Monica must zone for 8,874 new homes with half of them below-market rate. Having been struck by the Builders Remedy and getting their zoning suspended, within one week developers officially filed to build 4,797 new homes with 829 of them low income.

You can see the plans for these 8,874 DUs on the special website SM set up to track Builder's Remedy properties

This website has some google satellite images of the addresses
posted by rebent at 2:10 PM on February 2, 2023 [3 favorites]

Man, if I lived above a Costco I would literally never bother to shop anywhere else. I could finally sell my stupid car.
posted by aramaic at 2:10 PM on February 2, 2023 [6 favorites]

Low density single family and semi detached homes aren't self funding anywhere in the USA, prop 13 just made it worse.

Suburbs and exurbs are a ponzi scheme.
posted by ishmael at 5:36 PM on February 2, 2023 [1 favorite]

This website has some google satellite images of the addresses

What's particularly delightful is that it appears from this link that many of these sites had developments proposed in the past, and presumably stalled out because of Santa Monica's NIMBYs. A proposal for an 8 storey building downtown with 92 units? Now it's 10 storeys, 360 units (72 affordable). One went from five stories and 40 units to nine stories and 213 units.

The best example is 3030 Nebraska, which was proposed in 2019 as a three to four story mixed use development near light rail with 190 apartments. Good thing that it didn't get approved; it's now okayed for 2000 apartments, and the tallest building in the city.
posted by Superilla at 6:20 PM on February 2, 2023 [4 favorites]

Scott Weiner is the best! Thanks for this dense list of things-to-dig-into, kliuless.
posted by rrrrrrrrrt at 9:21 PM on February 2, 2023 [1 favorite]

What? Am I reading this right? Why is this not on all of the front pages?
posted by quillbreaker at 10:02 PM on February 2, 2023 [1 favorite]

This is not on all the front pages because it doesn't apply to cities that get their housing element approved (including the biggest Bay Area city, SF), and it doesn't prevent non-zoning ways to block housing. (E.g., lawsuits... there are a million grounds to sue on and the court system has not traditionally been very pro-housing. Moreover, this Builder's Remedy policy itself, even aside from environmental lawsuits, has never been tested in courts, and while most lawyers on the subject think that the remedy is absolutely the law, don't put it past the courts to find a loophole to invalidate it.)
posted by lewedswiver at 3:30 PM on February 3, 2023 [2 favorites]

What Kind of NIMBY Is Steph Curry? - "As far as celebrity NIMBYism goes, this is a pretty mild brew. Compare Curry to Dave Chappelle... Steph also comes off favorably in comparison to his venture capitalist neighbor Marc Andreessen..." :P

Not coincidentally, Tuesday was the deadline for many Bay Area cities to submit a plan to the state showing how they plan to make room for more housing, with the relevant land-use changes expected within 12 months. For more than 50 years, many California suburbs have treated this plan, called a “housing element,” as something between busywork and comic performance art, suggesting that new homes might get built on sites such as supermarkets, post offices, fire stations, and luxury hotels, instead of doing the unpleasant work of rezoning to legalize apartments.

In 2021, however, faced with a homelessness crisis and population flight driven by the country’s most expensive housing, California got serious about scrutinizing those documents, which in turn guide zoning codes, height limits, parking requirements, minimum lot sizes, and other housing restrictions. “A housing element is no longer a paper exercise—it’s a contract with the state of housing commitments for eight years and the Housing Accountability Unit will hold jurisdictions to those commitments,” Megan Kirkeby, deputy director of the California Department of Housing and Community Development, said in a statement.

What’s the state going to do about it? Apparently, activate an obscure provision called “builder’s remedy,” which strips away all zoning regulations for mixed- or moderate-income housing developments if a jurisdiction falls out of compliance with state housing law. Santa Monica found this out the hard way, when it accidentally abolished its zoning code last year and wound up with 4,000 new permits filed—two decades’ worth of housing in eight months. Several other Southern California cities also found themselves out of compliance.

Now it’s Northern California’s turn. Keeping track of all the various jurisdictions is complicated, to say the least, but Atherton has attracted attention for reasons that go beyond its famous residents. For one thing, it usually ranks as the most expensive ZIP code in the United States. It has not a single building with five or more housing units, despite the fact that land goes for $8 million an acre—downtown prices.* You would be hard-pressed to find a community with a higher ratio of home prices to architecture.

After neighbors revolted over the 23 Oakwood concept, Atherton sent in a draft housing element last August in the old style—which is to say, an unserious proposal. None of the detached single-family homes that make up 98 percent of the city would be rezoned, new multifamily housing would be “built” on the grounds of local schools, and more than 80 percent of the state housing goals would be met by creating hundreds of accessory dwelling units in back yards and garages. In October, the state rejected the plan, taking issue with just about all of it.

Which is how Steph Curry wound up writing to the city’s mayor...

posted by kliuless at 7:56 AM on February 4, 2023 [2 favorites]

-Governor Newsom Says Environmental Law Needs To Be Modernized To Increase Housing
-Bay Area Cities Just Lost Zoning Control. See the Wildest Homes That Could Come to Your Neighborhood
posted by kliuless at 11:19 PM on February 4, 2023 [1 favorite]

BIG HOUSING NEWS: "I introduced SB 423 to extend/improve our groundbreaking housing streamlining law SB 35, which I authored in 2017. SB 35 makes infill housing ministerial—no CEQA, no discretionary permits—in cities that don't meet their housing goals."[1,2]
posted by kliuless at 11:56 PM on February 13, 2023 [1 favorite]

I was talking to someone who got priced out of building altogether because of this. They inherited a little patch of land from their grandparents, and they were going to put a tiny house on it, which was all they could afford. Now if they wanted to build anything they would have to put a multi-story apartment complex.

As far as I figure it, California needs more housing and that is disappointing for the person I was talking to, but they're going to be fine. But I also keep seeing all these graphs about wealth distribution. And with these multi-story projects, that takes really huge piles of money. This zoning regulation may indirectly benefit homeless people, people who live outside. But it's not going to help that gay interracial couple I met who owned rural land, had extensive permaculture homesteading experience, and couldn't live there because their neighbors kept calling them in (in a region where everyone else is doing the same, but not while gay and interracial). It's going to help the big builders build more. Which we need! Hopefully it will drive down the price of housing.

Is there a chart of California housing ownership by household/corporate income/wealth over time?
posted by aniola at 8:38 AM on February 14, 2023

Maybe check out some of the data from the Public Policy Institute of California? "California’s High Housing Costs Have Created a Million “House Rich” Millionaires."
posted by JDC8 at 8:58 PM on February 19, 2023