Tom Thurston: The housing element revisited

When I attended the community briefing on the Housing Element on April 14, I had the impression that this was intended to be a meaningful process, where public comments would be taken into consideration in the development of housing policy. Senior staff from CEDA was there, including Eric Angstadt.

As Chairman of the Central City East Redevelopment PAC, I invited staff from Planning to address our May 4 meeting. There Devan Reiff explained the housing allocation for Oakland from the Association of Bay Area Governments (ABAG). He said further that the Housing Element merely needed to show that Oakland allowed for the possibility to meet their 14,000 allocation. That is to say, is there sufficient land upon which the mandated housing can be build, and does current zoning allow such building? It’s merely a matter of checking a couple of boxes. Yes, it is theoretically possible that these things can be built. Whether politics and economics will allow them to be built is irrelevant.

These things are either true or false. Public sentiment does not make them more true or more false. Public hearings give the opportunity to wax eloquent about the virtues or evils of subsidized housing, but they have no influence whatsoever on the facts. If Oakland wants to save money, streamline this review process as much as the sunshine ordinances will allow, since the public hearings are a sham anyway.

To add a further sense of unreality to the PAC meeting, Kathy Kuhner addressed the group on housing on behalf of the Oakland Builders Alliance. She said that all this talk about building 14,000 new units in Oakland was meaningless. Homebuilding in Oakland is dead. We have thousands of repossessed homes sitting unbought in Oakland, and thousands more in the pipeline.

Oakland cannot both have a shortage of 14,000 homes and a surplus of several thousand homes at the same time.

Tom Thurston is an East Oakland resident and Chair of the Central City East Redevelopment Area PAC.

21 thoughts on “Tom Thurston: The housing element revisited

  1. jarichmond

    Isn’t it actually entirely possible that we do have both a shortage and a surplus at the same time, depending on the quality of the “surplus?”

    I’m not necessarily disagreeing with your main point here, but if many or most of those repossessed houses have been vandalized and stripped to the point of uninhabitability, they might as well not be considered homes at all. If this is the case, the better way of saying it would be that we have a shortage of quality homes and a surplus of run down buildings.

  2. Patrick

    Not to mention that the areas of Oakland hardest hit by foreclosures are in the least desirable areas of the City. If 14,000 units popped up in Rockridge/Montclair, I bet they would easily find buyers. Of course, the residents of those areas would never allow it – which is why those areas are so desirable.

  3. Rebecca Kaplan

    There is no contradiction between today’s conditions being different from future projections.

    The projected need for 14,000 more units is based on the projections for the year 2014. There is no contradiction between saying there are many unsold units (in various conditions) on the market right now, but, nonetheless, there is a projected need for 14,000 more units by the year 2014.

    Yes, today, the fastest/easiest most cost-effective and most environmentally-sound way to help house more people is, in most cases, to acquire, re-hab, and re-inhabit existing vacant/foreclosed properties. Nonetheless, additional strategies are likely to be needed in the longer run.

    Part of why this process feels ridiculous is because there is no real enforcement and no real incentives. The process would be better if there were a state or regional incentive/funding mechanism. Outlying areas (exurbs) that want to build less than their estimated allocation could pay into a fund that would help incentivize transit-oriented development, etc in the areas that do provide the additional housing. Then it would be more possible to have an effective and useful housing allocation system for the future.
    -R. Kaplan

  4. OP

    For those interested in dreaming of a broader state-based solution… I recommend looking at New Jersey. In 1983 the NJ Supreme Court ruled that every municipality has a duty to provide its “fair share” of affordable housing, based on regional need (NAACP v Mt Laurel). The Legislature responded in 1985 by setting up standards for calculating how much affordable housing each city needed to provide and how they could meet that need. Interestingly, to preserve the interests of cities that did not want to have poor people come in, the Legislature allowed cities to pay other cities to build their share of affordable housing for them.

    ABAG sounds a bit like how NJ does things, in terms of calculating need, but without the teeth.

  5. Carlos Plazola

    As long as those cities that don’t build the affordable housing include a multiplier in their calculation that includes cost of providing services, amenities, and infrastructure.

  6. Carlos Plazola

    Irrespective of fiscal mismanagement, inefficient governments, etc, Oakland has a problem providing services to its residents largely because our revenue stream does not match up to the amount of money needed to cure our social ills.

    Suburbs do well financially because they have relatively new infrastructure not in great need of repair, their populations tend to be generally homogeneous without the need for stabilizing social programs, and they don’t have high crime rates because they don’t have concentrated poverty adjacent to wealth.

    Beyond reasons of NIMBYism, burbs fight the development of affordable housing because of concerns of lowering property values of adjacent properties, thereby reducing the tax base, and creating a larger need for subsidizing a larger percentage of their populations with social programs. (middle income people tend to pay for their children’s after-school programs, for example, where low income people cannot, so the government must subsidize this).

    So, if Walnut Creek wants us to build their portion of affordable housing, they should pay us more than just the cost for the unit. They should pay us the cost of replacing our aging infrastructure to that unit, the cost of any necessary subsidies required to serve the family, and a premium for the downward impact on the tax base which leads directly to a reduction in revenue to the city. (The basic premise is that market rate and luxury housing creates revenue for a city when you take property taxes+transfer taxes+disposable income minus the need for services, while low income housing requires financial subsidy for the creation of the housing, and for serving the needs of the residents.)

    Or better yet, how about our affordable housing advocate friends spread their advocacy efforts and force the burbs to build their fair share. Every city creates low, middle, and high income people, based fundamentally on the individuals’ skills of thriving in a capitalist economy, ambitions, and quite frankly, sometimes–luck . But when cities don’t build for the low income people born into their jurisdiction, these individuals have to find housing somewhere. Oakland has been very generous over the years in building affordable housing to meet the needs of neighboring cities, and we are feeling the pain of our generosity.

  7. Rose-May

    Folks, this coming week is affordable housing week. The week is packed with activities and policy talks. I recommend “State of Housing in the East Bay” on Wednesday 2:00-5:00 pm; Great Hall Bancroft Hotel at UCB. Details available at http://www.ebho.org

  8. David

    Why don’t we stop trying to engineer the housing market? Look where it’s gotten us, and don’t try to tell me that it hasn’t been engineered. Fannie/Freddie, the CRA, “affordable housing” BS, and everything else the gov’t has pushed on us.

    How about if I own a parcel of land downtown, I put on it what makes me money. If it’s a 12 story apartment building, then so what? If it’s a parcel over on China Hill, how about a half-dozen townhomes. Why does the gov’t have any say, it’s MY LAND.

    It’s well-past time to get the gov’t out of housing .

  9. Patrick

    True, David. I’m glad you believe that. I think we’ve discovered the perfect place to store nuclear waste: next to your house.

  10. len raphael

    CP, describing the need for a multilplier to allow areas to buy out of their low income housing allocations sounds reasonable. In the more simplistic smart growth viewpoints i’ve heard, it’s more of a “save the earth and help less the loss fortunate by building higher density cheaper housing for people” will offset all the social costs of that housing.

    Shouldn’t the same analysis be applied to market rate housing vs commercial vs slower growth to see if normal market decisions result in social costs other than just excessive reliance on cars.

  11. Patrick

    So, if Walnut Creek were allowed to pay the City of Oakland a multiplier to cover added expenses created by the low tax base that low income housing creates, how do you:

    1. Recoup the ongoing costs? Can Walnut Creek really pay enough to cover the expenses over a potential 50, 100 or 150 year lifespan? (I realize today’s housing is built to last the life of a mortgage, but still).

    2. How do you compensate current owners, businesses, etc. who will find themselves surrounded by low income housing? That would certainly have a detrimental effect on the value of their properties.

    This whole thing is such a conundrum. Low income housing, largely, is a failure. Chicago’s answer had been to demolish much of it. BMR isn’t a good deal for the “owner”, other owners, the developers or the city. Personally, I’d like to see a plan where we give people a home – in return for an agreement that they will forgo all other forms of pre-retirement welfare (with exceptions for extenuating circumstances, of course). Then, the homeowners are truly “invested” in their neighborhood. In the long run, it would probably cost us less.

  12. Carlos Plazola

    Patrick and Len, I was only half serious about the multiplier issue. I was just saying if these cities won’t take responsibility for building their fair share of affordable housing, then tag them with all the costs…which as you point out, Patrick, will be a HUGE multiplier taken out over many years. I don’t know if anyone has ever done this calculation but it would be fascinating to see, and it would explain a lot about Oakland’s fiscal challenges, I’m betting.

    My preference is to just force these jurisdictions to do their fair share. But given the fact that the State of California will never force them, who will? This is my pet-peeve with the affordable housing advocates–they choose to advocate for more affordable housing in the areas like Oakland that are already trying to do their fair share. Why? Because it is the path of least resistance? Easier to win a victory in than Orinda? Meanwhile, heads remain in the sand regarding all the other impacts to a community from concentrating affordable housing.

    FInally, Len, yes, I do think the analysis should be done for Market Rate housing, Commerical, etc. As a society, it’s stunning the amount of decisions we do without data, so the more data the better.

  13. len raphael

    CP, yup a multiplier would never become policy. It is comic that regional and muni planners are given criteria by the pols that are more simplistic than my kids used to have playing sim city.

    other than maybe dlf, is there a single council member who has objected to increasing low income housing stock in oakland before moderate and higher income proportions come up?

    -len

  14. V Smoothe

    District 7 Councilmember Larry Reid and District 6 Councilmember Desley Brooks both share similar views of housing policy as District 5 Councilmember Ignacio De La Fuente.

  15. Carlos Plazola

    I second what V says. Interestingly, those councilmembers that most represent low income communities share the same perspective…hhhmmmmm. Go figure.

  16. Ralph

    CP, like buying and selling carbon credits. Frankly, I’d rather Oakland build market rate housing. This built in BMR subsidy in the current system works for no one.

  17. Carlos Plazola

    My experience with Larry Reid’s policy decisions around housing are that he is a pragmatist. He’s trying to find the right balance of mixed income housing that allows neighborhood serving retail and revenue to increase in his district, and public safety to improve by hiring more police and developing more support services for families. He’s been a big advocate of encouraging market rate housing, and he’s been critical of concentrating all BMR housing in a few areas of Oakland, including his own district.

  18. livegreen

    CP,

    –It might be expensive for the State of CA to sue many municipalities for opposing their allocation of housing, but the City of Oakland would only have to sue 1 entity for not enforcing the laws: the State of CA;

    –Do you (or anyone else) know the requirements for getting in to AH? Is it helpful for an applicant to have a F/T or P/T employment?

    It would seem advantageous for the City to use A/H funds to take over some of the forclosures, fix them up, prioritize low income who are gainfully employed, and track them towards home ownership.

    This gets forclosures off the market, helps turn low income into middle class, and encourages community building (home owners take better care of their properties and neighborhoods).

    It would also help improve housing values throughout Oakland as well as revive the market for everyone. On top of it, stimulus funds might be able to be used…