The California Influencer Series

“Build a lot more of it”: What California can do to solve its housing problem

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The California Influencers Series

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Our readers are telling us housing affordability is a top concern for them. We asked the California Influencers to discuss what can be done to make housing less expensive in California.

Mike Madrid, Principal of Grassroots Lab

All policy proposals to address this problem are insufficient without one critical element — a dramatic increase in supply at all levels.

Jon Coupal, President of Howard Jarvis Taxpayers Association

Reduce impact fees. Relax California’s infamous regulatory burdens.

Rob Stutzman, Founder & President of Stutzman Public Affairs

The pols don’t want to deal with it, but we need regs streamlined and CEQA reformed to attract the capital to build and then build as fast as other states.

Roger Salazar, President of Alza Strategies

Basic economics would tell you that increasing housing supply will lower prices. However, in California, inventory in desirable locations is limited.

Madeleine Brand, Radio host with KCRW Los Angeles

Require developers to create affordable housing as part of their market-rate developments.

David Townsend, Founder of TCT Public Affairs

Remove all fees and costs required for local government and give exemptions for low-income housing for requirements such as sprinklers and solar panels.

Janet Napolitano, President of the University of California

California needs its local communities to reform local ordinances and building codes that unduly restrict the supply of affordable housing. Permits for new housing construction should include some component of affordability.

Eloy Oakley, Chancellor of California Community Colleges

Housing is a major concern for students in higher education as well as for all Californians. We need to provide more housing support for students and build more housing in urban communities. We also need to recognize that most young people can no longer afford to buy a home, and rents keep going up. We should consider tax breaks or other incentives to making living in California more affordable for the dwindling middle-class and struggling students hoping to live and work in California.

Ron George, Former Chief Justice of the California Supreme Court

Perhaps tax incentives for builders of affordable housing, and for those persons who will purchase or rent it.

Cesar Diaz, Legislative and Political Director of State Building and Construction Trades Council

There isn't a ‘one size fits all’ solution to California’s housing problems. Regional solutions must be examined. Regions should seek to effectively utilize the recently passed laws that streamline the approval of housing projects in cities that do not meet their housing obligations to achieve their goals. For that streamlining to apply, a project must include housing for certain income levels where there is a shortage of production, include important protections for construction workers, and meet all objective affordability, density, zoning, historic and environmental standards.

Labor has taken a leading role in supporting various solutions to provide critical funding for affordable housing projects, to protect local affordable housing laws, and to expedite the production of affordable housing units with necessary wage protections for the workers building these projects.

Jim Boren, Executive Director of the Fresno State Institute for Media and Public Trust; and Former Executive Editor of The Fresno Bee

We must substantially loosen government regulations, especially in impacted urban areas, that limit housing construction. The California Environmental Quality Act must be amended so that it meets its original goals, and is not used as a litigation hammer to block construction.

We also should fast-track the permitting process that slows getting housing built and to market. The cost of a house increases at every step of the time-consuming process.

Let’s also give home buyers more housing choices, such as smaller homes on smaller lots. Not every homeowner wants a ranch-style house on a huge lot, with a three-car garage.

We also need to make financing more accessible with state incentives that lower the cost and availability of home loans. Qualified (with emphasis on ‘qualified’) home buyers should be able to get financing approval much more quickly. It should be simple to cut through the costly bureaucratic delays that bog us down at every step of the process.

Angie Wei, Chief of Staff of California Labor Federation

Allow local governments to adopt rent control policies. Incentivize home ownership, not investors. Increase housing production. Create good jobs near housing.

Jessica Levinson, Professor of Law at Loyola Law School

This is a complex problem, which also boils down to a simple one of supply and demand. There is no silver bullet, but we need to foster more high density development to allow supply to catch up with demand.

Jim Newton, Lecturer of Public Policy at University of California, Los Angeles

Thoughtful use of government incentives.

Harmeet Dhillon, Republican National Committee, California, and Partner in Dhillon Law Group

Slash regulations and taxes that discourage building new homes, including rent control, high property taxes, environmental regulations and mandates such as solar, zoning regulations that prevent the building of smaller/second units on property, and allow property owners to control their properties and charge market rates and returns. Builders should not be required to subsidize lower income housing — but should be enable to build more housing without so much red tape.

Daniel Zingale, Senior Vice President of The California Endowment

Housing is a good example of where we can earn the confidence of millions who didn't believe their vote mattered on June 5. That means better representing the half of Californians who are renters or lower income homeowners. Protect tenants from harassment and price gouging. Preserve existing public and private affordable housing. Produce more lower and moderate income units, including publicly owned housing. Most fundamentally, recognize housing should be more than just a commodity. It is a basic human right.

Donna Lucas, CEO and President of Lucas Public Affairs

Expedite the permitting process.

Rosalind Hudnell, Former Vice President of Human Resources at Intel Corp and Former Chair & President of Intel Foundation

The concept of affordable housing and California has almost become an oxymoron. Increasingly high wages for some has equated to increased gentrification. Making current expensive housing less expensive is likely unrealistic. Creating new areas of affordable housing through incentivizing different developments, more affordable mortgages and a total revamp of our property tax system is needed.

Chet Hewitt, President and CEO of Sierra Health Foundation

Financial incentives to support the building of affordable and low-income housing; full implementation and enforcement of SB 35; regulatory relief (zoning) to reduce the cost and timeline for securing local approval; municipal development mandates to battle NIMBYism. It may be time to bring back an improved redevelopment agency system.

Aziza Hasan, Executive Director of NewGround: A Muslim-Jewish Partnership For Change

There is a great deal of opposition to new housing developments. We need to find a way to convene conversations to hear the concerns of those who oppose affordable housing developments in their neighborhoods and find a way to actually address their needs so that we may start building.

Erwin Chemerinsky, Dean and Professor of Law at University of California, Berkeley School of Law

Build a lot more of it.

Jon Fleischman, Publisher of the FlashReport

We reduce the cost of housing by increasing the supply. This is done by reducing the taxes and regulations that increase the cost of build housing, and reducing state and local regulations that inhibit the construction of new housing, throwing zoning restrictions. Increasing housing at every economic level means people can improve their circumstances, vacating smaller homes or apartments for others to move in. It’s a fools errand to simply provide subsidies for some people to be able to afford expensive housing.

Allan Zaremberg, President and CEO of the California Chamber of Commerce

Simply put, we need to build more housing.

Renata Simril, President and CEO of LA84 Foundation

Speed to market and reduce government/environmental regulations, finding new sources of revenue to support development of mixed-income and affordable housing.

Kim Yamasaki, Executive Director of Center for Asians United for Self Empowerment

The short answer is to build more housing. The issue of housing affordability strikes low-income and middle-class communities, but there is little incentive for developers to build for this consumer market. Just as much as we look to expand affordable housing efforts, we should also look to implement policies that ensures market rate housing stays affordable. If we need to build up rather than out, we need to create policies that incentivize developments that are considering the working, middle-class — not just affordable housing and luxury units. Now, more than ever, more young professionals are moving out of their parents’ homes later rather than sooner. When young adults and low-wage workers begin to make more money, we need to have the next affordable option readily available for them.

Bill Burton, Managing Director of SKDKnickerbocker in Los Angeles

Better zoning laws could be the difference in making sure that more units are built that more people can afford.

Laboni Hoq, Litigation Director for Asian Americans Advancing Justice

Because the housing crisis has become so acute, we need to put more options on the table to expand supply. This means more than just building more housing units and mandating that developers include more affordable housing units in new projects, but also mandating and incentivizing both government and private entities to support this expansion in creative ways. Some options are: changing zoning laws to allow for multi-dwelling units on single lots and improving transportation and remote work options so people can live farther from commercial hubs where housing is more affordable.

Timothy White, Chancellor of the California State University

Nearly all experts agree that California must build more sustainable and affordable housing, increase housing density in urban areas, and expand useful public transit options. However, new construction alone will not solve the problem. Indeed, we must also ensure that the most vulnerable Californians have more opportunities for social and economic ascent through education, job training and housing assistance. With the cost of housing a large driver of the overall cost of attending college, many CSU campuses are investigating innovative partnerships to make housing more affordable for students.

Matt Baretto, Professor of Chicano Studies at UCLA and Co-founder of Latino Decisions

There is no question that access to affordable housing is a top issue facing California. We can not continue thrive as a state when half the population could never afford to buy a home. To address this issue we can start by passing the housing bond measure on the ballot in November 2018 which creates incentives for building more affordable housing, multifamily housing, loan assistance for first-time buyers and much more. The bottom line is we have to create incentives, or else requirements, for builders to pursue more affordable housing developments, more transit-oriented development, and more equitable access to loans for first-time buyers.

Linda Ackerman, President of Marian Bergeson Excellence in Public Service Series

The high cost of housing is driving residents out of our state; is this an unintended consequence of the draconian regulations that face the housing industry here?

In 1970 you could purchase a lovely three bedroom home on a 10,000 sq. ft. lot for $26,000, the average cost today is $500,000. The price of a typical single family home in California is more than twice that of the same typical home across the U.S. The average home developer in California pays a $22,000 permit development fee to build a home and that does not include water fees, vs. the average $6,000 across the nation. The additional regulatory fees they pay can bring this total from $50,000 to $85,000. We will be adding to that total $4,500 per unit in the near future due to a legislative mandate that will require solar panels to be installed on all new homes built by the developer.

CEQA which breeds oppressive protracted environmental lawsuits, as well as equally oppressive land-use lawsuits filed against developers, delays new home development for years and often results in fewer homes being built.

It will take the strength and the will of our Legislature to take a look at a backlog of hundreds of thousands of needed housing units to make tough decisions about the consequences of over regulation.

I think we ask ourselves, do we want more growth in California, not only for our children and grandchildren, which in turn will grow our economy, or is the intention to control it?

Manuel Pastor, Director of Program for Environmental and Regional Equity at the University of Southern California

I’m often asked what is the one thing I would do to solve (name your) crisis. I always give the same answer: the one thing is to stop thinking there is one thing.

This is more than true with California’s crisis of housing affordability. First, we need to repeal Costa Hawkins, the state legislation preempting local rent control measures, so that municipalities can implement rent regulations to relieve short-term pressures. Second, we should continue to put in local and state dollars to help nonprofit and other developers build affordable housing; this is particularly so since the recent corporate tax cuts have rendered less valuable federal tax incentives for building low-income housing. Third, we must streamline regulations to speed up housing construction; especially interesting here have been local efforts to allow more “accessory dwelling units” (or “granny flats”) in our built-out urban neighborhoods, particularly if they are tied to housing homeless individuals or those with Section 8 vouchers (federal subsidies for low-income renters).

It’s an unlikely ideological mix, I know: more rent regulation, more building and more streamlining. But like I said, we need to do more than one thing – and we need to start doing all of this (and more) now.

Cassandra Pye, President of California Women Lead, Founder and CEO of 3.14 Communications

“It’s either disingenuous or a waste of time in my opinion to claim that affordable housing is a priority without calling out both the need for reform of our CEQA laws and the profound and at times surprising NIMBYism that exists within California’s communities. Builders propose projects, jump through hoops for approvals, neighbors sue. City councils vote yes, builders submit plans, environmental groups sue. The 1970 law is used as a tool by labor unions, environmental activists and even business owners to kill projects, even in cases where environmental protections aren’t an issue. There is currently no downside for any of these interests to sue; they can recover attorneys’ fees, while public agencies cannot. CEQA lawsuits also take far longer than they should and longer than current law intends. Californians claim they want low-cost housing – so long as their perceived home values aren’t impacted. This is one of those issues that won’t be well-served by soundbites or unrealistic promises. Both gubernatorial candidates should take the time between now and November to educate and then engage voters in the reform conversation. If we want to build more housing, there will be short-term sacrifices for most of us. Let’s get real about it.

Dorothy Rothrock, President of California Manufacturers & Technology Association

Affordable housing is crucial for a thriving economy and for years we’ve made it expensive and difficult to build enough new housing to meet demand. On top of that, we have been creating many low-wage jobs that cannot support home rents or ownership. Since the recession ended in 2010, California middle-class manufacturing employment has increased only 5.6 percent while the rest of the U.S. has seen 11.2 percent growth. California employment is more concentrated in lower-wage service jobs or the highest wage professional categories where housing affordability is not an issue. We can lower the price of housing by increasing supply, but to close the gap on affordability we need more middle class employment.

Catherine Lew, Principal and Co-Founder of The Lew Edwards Group

Are you prepared to work almost four full-time jobs simply to afford a place to live? The #outofreach study released recently (NLIHC.org) shows a minimum-wage worker holding down one, two or even three jobs wouldn’t earn enough to afford a two-bedroom rental. And teachers, restaurant and hotel workers, police officers and firefighters can no longer afford to live near where they work. We should expand access to housing more families can afford, by increasing inclusionary housing requirements on all new development and enacting strong tenant protection laws to limit skyrocketing rents. But ultimately, this question is framed wrong. Making housing “less expensive” in this bloated market doesn’t ensure that more working people can afford it — even at a lower cost, housing may very well remain out of reach for many. Instead, the question should be: ‘How can we make housing accessible for all people?’ To achieve this goal, we must be prepared to put people before profits.

Carl Guardino, President and CEO of Silicon Valley Leadership Group

We need a ‘Butch and Sundance’ moment ... ‘I’ll jump if you jump.’ Our housing crisis requires both revenue and reform. Democrats need to accept the need for reforms on issues like CEQA that impact housing costs and construction. Republicans need to appreciate the need for funding affordable homes. It takes revenue and reforms.

Les Simmons, Pastor at South Sacramento Christian Center

Housing and affordability are both complex and critical issues in California and here in Sacramento. The lack of affordable housing and the increase in rents creates economic distress for many in our community and contributes to the problem of homelessness as well. New public policies need to be developed to address this issue.

Both city and county should consider adding inclusionary zoning to our housing element. There is a need to develop a local source of funding to help our nonprofit and affordable housing developers obtain the finances necessary to construct more affordable housing units.

A potential source of funding here in Sacramento could be a portion of the Measure U funds. The measure is up for renewal this November and the City Council is proposing increasing the 1⁄2 cent sales tax to 1 cent. The additional funding would permit Sacramento to create housing bonds to develop affordable housing.

With California being the fifth largest economy in the world, as well as socially charged in a way that protects our values of loving people, it is time for us to think smarter. New developments must focus not just on profit but with the mindfulness of the wages earned by those in the community. Our target should be on the teachers, the grocery store workers, mechanics, as well as the historical residents of our urban communities. With solid policies that block gentrification from displacing our residents.

Mindy Romero, Founder and Director of the California Civic Engagement Project at UC Davis

There are many factors that impact the affordability and availability of housing in California. Some factors are beyond the control of local, state and federal government, such as the high price of land, and national and international policies that drive up the cost of building materials. Others factors can be addressed. Fixing the housing crisis requires consensus-building and the political will to carry out concrete measures. To start, here are seven steps that Californians can demand their elected representatives take:

1. Reduce or expedite regulatory and permit processing requirements, to create more certainty and predictability in the development process.

2. Allow more flexible zoning for the construction of underutilized housing products like accessory dwellings, multiplexes and cottage apartments.

3. Cut back on some required state building regulations, such as those for minimum required parking, and expensive building materials.

4. Reduce development fees for projects that include or increase the share of affordable housing.

5. Provide more job training in the construction profession. Some building projects are stalled due to limited labor supply.

6. Encourage local governments to use public surplus lands for affordable housing.

7. Develop and fund local housing trust funds to create subsidized housing that is accessible to low-income households.

Maria Mejia, Los Angeles Director, Gen Next

If we are serious about solving our housing crisis in California, we must explicitly reject the culture of NIMBYism that drives so many of our housing policies across the state. Cities and developers also need to stop vilifying one another and approach collaborative solutions from a place of YES.

Greedy developers and no-growth cities exist, but so do good actors, and my experience working with California’s vast network of city officials and community of developers has taught me that there is common ground, and we should embrace it as the only acceptable paradigm on which we operate.

Only then can we enter into the kind environment that makes already difficult compromises possible, and that allows us to increase cities’ housing supply (and thus improving accessibility) and in a way that is reflective of our residents' increasingly diverse housing needs.

Ashley Swearengin, President & CEO of the Central Valley Community Foundation

California is such a large and diverse state that it’s incredibly difficult to come up with a statewide approach to making housing more affordable. What may work in the large urban areas are not good solutions for other parts of the state and vice versa. The state’s leaders ought to be looking for regional solutions. Today, every locale is required by law to produce a Regional Housing Needs Assessment (RHNAs) but in many cases, RHNAs end up as plans sitting on the shelves of local agencies because there are several flaws in the way the regulations that govern the development of these plans. Our state’s leaders ought to re-envision and reform the policies and regulations surrounding RHNAs and really create a tool that incentivizes and increases housing supply in places where it makes sense at the regional level and penalizes local governments for not implementing what they commit to in their reformed RHNAs.

Gray Davis, Governor of California, 1999-2003

To deal with the high cost of housing we must come to terms with the elephant (no not Trump) in the room, The California Environmental Quality Act. Anything else is just tinkering.

CEQA should be renamed the law of unintended consequences. Originally intended as a way of identifying the environmental impacts of a project (and avoiding or mitigating them), CEQA has been hijacked by litigants to advance their political, social or economic interests. Using CEQA for those reasons has little or nothing to do with protecting the environment.

If you’re keeping score, here’s what it means. People of already modest means spending upwards of 40-50 percent of their income on housing. Longer commutes. More traffic and pollution. A 23 percent poverty rate, the highest in the nation. Record low home ownership and an exploding homeless population. This is madness, but there are solutions. Here is one; exempt from CEQA any projects that shelter or service the homeless. If the Legislature can provide special expedited environmental review for a NBA arena in Sacramento or a proposed NFL stadium in Los Angeles, surely it can do so for the least amongst us, the homeless!

Jim Wunderman, President and CEO of Bay Area Council

There are two principal drivers of this crisis: we are building far too few new homes and the ones we do build far exceed what many Californians can afford. First and foremost we need to build a lot more housing. California has a housing deficit of 3.5 million units and the state Legislative Analyst’s Office estimates it’s growing by 100,000 units a year. Funds for affordable housing are extremely important and must be dramatically expanded. But, we can’t subsidize our way out of this problem, which the LAO estimated would cost $250 billion.

Secondly we need to bring down construction costs. At over $800,000 per door to build an apartment in San Francisco, it is impossible to build for middle-income residents. Myriad impact fees, abusive CEQA challenges, expensive building codes, and rising materials and labor costs all make new construction incredibly expensive, especially the sort of sensible transit-oriented development that aims to put housing near jobs and mass transit.

Legislation the Bay Area Council is sponsoring this year aims to hold cities more accountable for meeting their housing obligations (SB 828), remove barriers and lower costs for building granny or in-law units (SB 831) and expand affordable student housing SB (1227). This is a start. Much more needs to be done.

Sal Russo, Co-founder of Tea Party Express

We have burdened home building with too much regulation and cost, both at the state and local government level. Development is often frustrated with high fees, excessive litigation costs fighting opponents to nearly every project, and excessive building requirements. While generally in place for good purposes, the collective impact is unaffordable housing.

Eric Bauman, Chair of the California Democratic Party

Extend rent control, underwrite house down payments, and guarantee lower interest rates for purchase.

Curt Pringle, former Assembly Speaker and Founder of Curt Pringle & Associates public relations

Housing cost drivers need to be reduced. But people see those drivers from their political perspective. Land cost is a significant driver. That can be addressed by encouraging cities to increase density in certain areas within their community. Government fees and mandates should be reduced, as they are great cost drivers. But also the cost of parking is a very significant driver, and cities need to reevaluate parking requirements that in many cases have not been reevaluated in decades.

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