Scott Wiener’s SB 50 is a WIMBY Bill

John Mirisch
Mayor of Beverly Hills

Zev Yaroslavsky, former LA County Supervisor and former LA City Councilmember, astutely noted that state senator Scott Wiener’s SB827, which would take away local zoning authority from cities and replace it with Sacramento-mandated levels of density in certain areas, was a “real estate bill, not a housing bill.”

The exact same assessment should apply to SB50, Wiener’s latest iteration of SB827.

And I can prove it.

Yaroslavsky famously took the acronym of the developer-funded YIMBY groups that supported SB827 (“Yes in by back yard,” which itself is derived from NIMBY, “not in my back yard” — get it?) and put a new twist on it, describing the bill’s supporters as WIMBYs. That would be the acronym for “Wall St. in my back yard.”

Wiener’s latest is cut from the same WIMBY cloth and is still a real estate bill, not a housing bill.

Sure, Wiener has learned a lot from the failure of SB827. In fact, if I were a Vegas oddsmaker, I would bet on SB50 to pass. Wiener is a smooth operator and a savvy politician. He backed state Senate President pro tem Toni Atkins early in her bid for the top Senate spot and was rewarded with the chairmanship of the powerful Senate Housing Committee (which had previously been chaired by senator Jim Beall as the combined Housing and Transportation Committee).

Scott Wiener has reached out to unions, throwing out the bones of PLA’s and union wages to remove opposition to his “build, baby, build” mantra.

The gentrifying effects of displacement were a major criticism of SB827.

So he’s tried to deflect criticism from racial justice groups who had commented “Scott Wiener is to gentrifiers what Donald Trump is to racists” by creating carve outs for some of their communities and adding measures which he claims would prevent displacement.

Like SB827 – perhaps even more so — SB50 is aimed at eliminating or reducing single-family housing, which acolytes of Wiener’s guru Richard Rothstein (“The Color of Law”) have described as “racist” and “immoral.” Yet this time around, Wiener has softened his rhetoric. In fact, Wiener is now taking pains to point out that he himself grew up in a single-family house.

He has added provisions that supposedly would address affordability issues which were a mere afterthought with SB827 (to which he eventually added a few band-aids supposedly addressing the issue).

Most of all, Scott Wiener has tried to create a narrative in which 1) cities themselves are responsible for California’s housing affordability crisis; in which 2) we have to do “something” to address the crisis; and in which 3) his “solution” is that “something.” Never mind if his prescription will actually achieve its intended effect – which for the sake of gaining support is ostensibly more affordable housing – it’s “something.”

Yet Wiener’s learnings all seem to have been strategic rather than substantive. They are all political. SB50 is the proverbial lipstick on a pig and his “solutions” are the urban planning equivalent of trying to cure diabetes with Prozac.

Wiener’s bill is still WIMBY. Big WIMBY. And his housing “solutions” really just are smokescreens cleverly designed to use the housing affordability crisis to increase developer profits.

Wiener’s WIMBY goals should come as a surprise to no one.

Scott Wiener was the California Building Industry Association (CBIA) legislator of the year. The bulk of his campaign cash comes from developers. Yet Scott Wiener denies being a developer shill.

Let him prove it.

One simple amendment to his bill would certainly be a great start.

But it won’t happen, because SB50 is a real estate bill, not a housing bill.

Now, I personally believe local government, when done right, is the best form of democracy, because it’s closest to home; I believe in individual communities and in the right of those communities to self-definition and self-determination. I don’t believe that Wiener’s backwards-looking take on urban planning using stale theories of TOD (transit oriented development) or the “corridors of density” they would create make any sense from an urban planning perspective. I believe urban planning should be forward-thinking (AOD or autonomous oriented development would be one such example), respectful of the unique DNA of our communities and tolerant of various lifestyle choices. Those communities looking to densify should look at organic nodes of density rather than corridors.

Wiener’s scapegoating of cities as a ploy to impose one-size-fits-all Sacramento diktats is both offensive and deceptive. His bill does nothing to address the root causes of the state’s housing affordability crisis, namely job creation/job concentration and income inequality. His bill does nothing to create sustainable housing solutions by addressing the geographic inequities within the state which result from economic development which is skewed towards the Bay Area and the Southern California coastal areas.

But if one were to accept Wiener’s bomb- and rock-throwing attempt at urban planning, then a simple amendment could change the direction of SB50 from a hardcore real estate bill towards the actual possibility of becoming a housing bill.

It’s pretty simple: any statutory upzoning that SB50 allows should be restricted to non-profit affordable housing developers.

That’s it. It’s now essentially a housing bill (albeit still a flawed one).

Let’s face it. It is pretty absurd to put non-profit developers in the same boat as for-profit developers. Sure, one could argue that both provide housing to varying degrees — in the same way that Martin Shkreli’s Retrophin and St. Jude both offer treatments for cancer.

But it’s really pretty simple: the goal of non-profit developers is to create housing. The goal of for-profit developers is to create profits.

Big difference.

What’s more, for-profit developers, for obvious reasons, compete directly with non-profit developers. For land. For construction workers. For building materials. They also, for obvious reasons, have a lot more resources. They make affordable housing projects more expensive for non-profit developers. Allowing only non-profit developers to benefit from any statutory upzoning would not only help level the playing field, it would ensure that the goal of creating affordable housing would be achieved in the most efficient, least disruptive manner.

Think about it: when a non-profit developer builds affordable housing, 100% of the units are affordable. With the inclusionary housing advocated by Wiener, the number of affordable units would be a fraction of the total (not to mention an even smaller fraction of the value of a project and an even smaller fraction of the overall square footage).

Right now cities can create inclusionary housing policies of up to 15% of units without having to perform “nexus” studies and without fear of being sued by developers. At the present, SB50 has a blank placeholder for an inclusionary housing percentage. Let’s say Wiener goes hog-wild and includes a 20% inclusionary housing requirement for his for-profit developer buddies (which he won’t do, because it would squeeze their profits).

Even with a figure of 20% inclusionary housing, non-profit developers could still build at least 5 times the amount of affordable housing as Wiener’s CBIA cronies. Actually more than that since the inclusionary figure represents the number of units and, of course, the affordable units in for-profit developments tend to be the smallest size units.

Furthermore, additional market rate housing actually itself increases the need for affordable housing, as a recent nexus analysis for Wiener’s San Francisco itself shows. So SB50 aims to create more market rate housing, which would in turn exacerbate the housing affordability problem by creating an even greater demand for affordable housing. It’s the very definition of a vicious circle and it could and would be mitigated by amending to the bill and solely creating incentives for the addition of non-profit affordable housing only.

Without wanting to sound too much like a ginsu knife commercial: there’s more! For-profit developments only have a limited window of affordability. In other words, after a fixed period of time, developers can reclaim the affordable units and go back to market rates.

In contrast, non-profits can keep their housing affordable forever.

Not only would amending SB50 to only allow upzoning for non-profits actually have the effect of creating more housing, it would also avoid the disruption, displacement and inequity that can occur when luxury projects include a minimum of “affordable” units. A 50 unit luxury condo development could, for example, contain five small studios with non-access to some of the luxury amenities, as well as a separate entrance – a so called “poor door.”

By only allowing non-profits to take advantage of upzoning, we could avoid such humiliating scenarios and instead work with the non-profits themselves to organically integrate their projects within our individual communities. Eliminating profiteering would also allow non-profit housing developers to get the best value-for-money possible by focusing on the actual creation of affordable housing rather than profit margins.

But Scott Wiener is quick to defend developer profits at the same time he denies being a developer shill. On a recent podcast in which Wiener was lobbed softball after softball by the star-struck hosts (who completely ignored Wiener’s war on single-family housing), he sarcastically remarked: “Heaven forbid that developer made a profit from building that home. Otherwise the developer wouldn’t have done it.”

Bingo. Nailed it: the developer’s motivation is profit — not the creation of housing.

Of course, Wiener’s snark completely ignores the non-profit developers, whom he begrudgingly and under his breath admits also provide housing. The implication is that rather than making it more attractive – or possible – for non-profits to provide housing, Sacramento should let developers profiteer as Wiener somehow seems to think that they are “doing well by doing good,” to quote an old Tom Lehrer song.

Amending SB50 to only allow non-profit housing developers to take advantage of upzoning would have the impact of creating more affordable housing. Instead of expending his energy by attacking cities, Wiener could work on bolstering the resources of non-profit housing developers by bringing back redevelopment with the intention of using the lion’s share of funding thereby generated for affordable housing.

But that’s nothing a corporatist like Scott Wiener is really interested in; instead he prefers to embrace the Reaganomic YIMBY mantra that market-rate housing, including ultra-luxury housing in which worldwide capital can find a place to park funds, will “trickle down” (or “filter,” in their parlance) to the peons and reduce overall housing costs.

As if producing more Rolls Royces is really going to bring down the price of Priuses. Of course, these trickle-down, “the market will solve everything” theories sound even more bizarre coming from Wiener and the self-styled “progressive” YIMBYs than they do coming from Arthur Laffer and Robert Mundell, but make no mistake about it: Blackstone, the Koch Bros, Wiener and his YIMBYs are all singing from the same hymn sheet.

This also may explain why Wiener did not support Prop 10, which would have given cities more leeway to introduce rent control and rent stabilization ordinances which would actually have protected tenants against runaway housing costs. It should come as no surprise to anybody that Prop 10 — to the tune of some $100 million — was violently opposed by Blackstone and Wiener’s Koch Bro Bros. And it also likely explains why Wiener vocally opposed Prop C in San Francisco, which raised taxes on corporations to increase funding to address homelessness (fortunately, despite Wiener’s opposition, Prop C passed).

Yes, here’s a guy who in connection with his bill SB50 points to 17,000 homeless kids in the LAUSD on the aforementioned podcast, but who at the same time opposed a measure to raise $300 million a year to provide services to… homeless kids in San Francisco. As if more luxury housing created by Wiener’s SB50 would somehow help the homeless kids, but additional funding would not. Yes, Sacramento can sometimes put Lewis Carroll to shame.

While SB50 remains a real-estate bill masquerading as a housing bill, let’s hope that other legislators who are actually interested in effective rather than punitive measures to address the housing affordability crisis look to create bona fide housing bills.

Senators Jim Beall and Mike McGuire seem to understand that one-size does not fit all and are drafting housing legislation with understanding and respect for the individual needs and situations of our state’s unique and varied communities. My guess is they are not going to be interested in the developer giveaway approach Wiener has chosen with SB50. If their own bill looks to differentiate between those whose lone goal is affordable housing and those whose main goal is profiteering, then we may actually be on the right track to finding real, reasonable, workable and fair solutions to the housing affordability crisis.

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