SB 50, the controversial bill to mandate high-density housing near transit hubs, recently failed to pass the Senate Committee on Appropriations. Though the bill is likely dead for the year, its author – Senator Scott Wiener (D-San Francisco) – vowed to bring it back before the legislative session ends in September.
That could be a tall task.
The bill failed last year to get the votes necessary to pass in its first policy committee – at a time when most bills succeed in getting a wave of approval from fellow partisans on these “policy” panels. Unvanquished and unrepentant, Wiener brought the bill – albeit extensively watered down – back to the Legislature again this year for a second try. After initially advancing, the measure failed again. While business groups supported the bill, local governments were strongly opposed to it and are credited with both defeats.
The bill was seen as a break-through measure. In the name of the state’s housing-supply crisis, the bill allowed Sacramento for the first time to veto local land-use decisions. Indeed, SB 50 required a housing project to qualify for higher densities – and other incentives – if it could be demonstrated that it existed in either a “jobs-rich housing” or a “transit-rich housing” environment.
The bill was viewed as a production stimulant – so far the best reform to local zoning restrictions, which are arguably the main cause of the state’s housing supply-driven shortage. (Ironically, most state lawmakers – initially sympathetic to the goals of SB 50 and Senator Wiener – once sat on local city councils and were always highly skeptical of heavy-handed land-use edicts handed down through state legislation. But, as a shrewd legislator once said of the almost predictable change in sympathies of newly minted lawmakers – after constant bombardment by Sacramento-based special interests – “sometimes they forget where they came from.”) Ultimately, the measure ran up against the powerful local government lobby, which ultimately prevailed by wearing down legislators with arguments that appealed more to NIMBYism and less to housing.
With the defeat of SB 50 goes any likely, near-term end to California’s housing crisis. All new housing projects must be approved by those city councils – or their companion board of supervisors – and most local politicians listen primarily to those who got them elected in the first place. That means no matter how desperately a neighborhood needs, say, an apartment building with multiple bedrooms to match the community’s growing need, decision-makers will pay closest attention to the group of activists who oppose the project.
Those activists – more likely than not backed by a lawsuit, brought under the California Environmental Quality Act (CEQA) – have the upper hand in the debate over whether the project should move forward or not and are, helped by CEQA, the most likely to be successful in getting a halt to it or to win a significant delay.
What else comes with SB 50’s defeat is a rather sizeable hole blown into Governor Newsom’s plans for increasing housing supply by 2025 – 3.5 million units. Those plans rely heavily on the state’s abilities to influence – or even direct – changes in land use at the local level. For example, the Governor in his budget for next year is banking on tens of millions of dollars to affect housing decisions in the dozens of communities where he allocates them. His thinking there is that locals will be so taken with the money (likely seen as “pennies”) being showered on them by the state that they will begin to systematically approve new projects.
The Governor has also tried suing a jurisdiction – Huntington Beach – over its alleged failure to identify an adequate supply of new housing sites. Being successful in the lawsuit will depend on Huntington Beach approving new zoning. Good luck with that. Finally, the Governor toyed with the idea – for awhile, at least – of withholding state infrastructure funding to communities that fail to meet their housing needs. That idea, however, was shot down almost immediately amid howls of executive trespassing all over local control.
With SB 50’s recent demise, are the politics there to support the Governor, or any kind of relief? Doesn’t seem like it. To change minds locally – and consequential land-use decisions – is going to take money, period. And, lots of it. More than the Governor has proposed, I’m afraid. Billions, not millions, will have to flow – with very few strings attached – from Sacramento into the coffers of major “job centers” before anything meaningful happens.
Former state Treasurer Jesse Unruh once called money “the mother’s milk” of politics. While he was talking mainly about campaign contributions, more generally he may have been right.