Robert Tillman owns a coin-operated laundromat in San Francisco’s Mission District, a neighborhood at the epicenter of California’s housing crisis. Over the last 2½ years, he’s spent nearly $500,000 on plans to tear down the business to build apartments. But although the city has zoned the property for apartments, Tillman hasn’t gotten very far.
Local residents can file a formal complaint to the city to hold up Tillman’s project because they don’t like how it looks, how tall it is or where people will park, starting a chain of appeals leading all the way to the Board of Supervisors. Environmental lawsuits could add years of delay amid exploding demand for new homes in a region with six times as many new jobs and people as housing units added from 2010 to 2015, according to a study by the Terner Center for Housing Innovation at UC Berkeley.
“Everything is a negotiation,” Tillman said of trying to build houses in San Francisco. “There’s no single person you can negotiate with who has the ability to make a deal.”
Under a new plan from Gov. Jerry Brown, that dynamic should change. Brown’s proposal would force local governments to approve any urban housing development provided the project matches the underlying zoning and a certain percentage of homes are set aside for the poor, adding some certainty to processes across the state that Tillman and other developers have described as overly complicated.
The governor introduced his proposal as part of his revised state budget last month. Negotiations with lawmakers are now underway, with a final deadline for an enacted fiscal plan to come June 15.
Experts have said Brown’s plan would fundamentally change how housing gets built in cities like San Francisco and Los Angeles and others that require layers of approval for every large development. The average home price in California is $464,000 — almost 2½ times the national average cost — and academics and economists have cited the state’s extreme lack of housing supply, particularly in coastal cities, as the primary driver.
To spur growth, Brown wants to wipe away local and state rules on parking, height, density and environmental reviews beyond those already required through zoning.
“That kind of micro-managing is a luxury that the state cannot afford at this time,” said Ben Metcalf, Brown’s director of housing and community development.
In cities with significant existing restrictions on housing beyond zoning, the measure’s effects could result in profound changes to the development approval process. In San Francisco, housing projects can face multiple approvals from city officials as they try to address neighborhood concerns about a project’s height, design, parking and affordability, a process put into place after a 30-year-old ballot measure laid down significant community controls over growth. In Los Angeles, a decades-old legal settlement over a proposed shopping center in Westwood has forced developers who want to build more than 50 units to undergo a lengthy environmental review regardless of the area’s zoning.
These rules, and others like them across the state, could go away if Brown’s legislation passes.
“I do imagine that the citizens of many cities will become unglued when they understand what this will do,” said Michael Brilliot, a manager in San Jose’s planning department.
Still, Brown’s plan would not create a boom in housing supply that experts say is needed to rein in costs. The governor’s legislation does not include wholesale reform of the state’s environmental or tax laws, which could incentivize significant residential growth. It also won’t affect projects that are bigger than what current zoning allows. For instance, if a developer wanted to build high-rise condominiums on land planned for bungalows, the project still would require detailed local government review.
For that reason, Brown’s proposal doesn’t address major development issues such as “spot zoning,” which occurs when developers attempt to get city councils to rezone land to build larger projects than previously allowed. Nor is Brown’s plan likely to significantly affect housing in cities like San Diego or San Jose, where few additional approvals are required as long as projects match their zoning, officials in both cities said.
State officials have not said how many houses Brown’s proposal could pave the way for, though they believe qualifying projects will see their costs decrease by 12% if the measure passes. UC Berkeley researchers have estimated that the measure could create as many as 2,350 units in San Francisco.
Any increase in supply would go toward reducing a big deficit: The nonpartisan Legislative Analyst’s Office has estimated the state has to build roughly 110,000 units annually beyond those already planned to keep pace with housing price increases.
Brown’s proposal also addresses a deeper issue central to how development works in California: How much of a role should the state have in land-use policies, especially during a time of severe housing affordability concerns?
Some academics argue that greater state and regional control over development results in more affordable housing and neighborhood diversity. Researchers at UCLA recently found that the more influence local residents had over zoning, the greater the segregation between rich and poor communities within cities.
But California already has laws on the books to prevent housing segregation, and local control over development allows neighbors to express real concerns about the future of their communities, said Dan Carrigg, legislative director of the League of California Cities, which opposes Brown’s plan.
Brown’s legislation would speed up housing development, but it would come at the cost of resident input, Carrigg said. He contends those who are opposed to development near them — branded NIMBY or “Not In My Back Yard” by opponents — deserve to be heard.
“If the problem is with a NIMBY, well, that’s a resident, that’s a citizen, that’s a voter,” Carrigg said.
Back in the Mission, Tillman’s situation underscores the complexities involved in local development. Tillman wants to build 73 apartments in eight stories with retail on the ground floor. Most of the units would go to people who could afford the high cost of rent in such a desirable location. A major subway station is within two blocks and top-rated restaurants populate the area.
“If you can’t build housing there,” Tillman said of his property, “you can’t build housing anywhere.”
But the Mission, long home to San Francisco’s Latino community, has seen waves of concerns about gentrification and displacement of longtime residents as housing prices and rents have gone through the roof. The debate reached a fever pitch last year when San Francisco voters rejected a ballot measure that would have restricted new development to projects only for low-income residents.
Tillman is setting aside at least a half-dozen apartments for very low-income residents and said he’s sensitive to the concerns about gentrification.
“I’m not displacing anybody,” Tillman said. “I’m not displacing any business except my own.”
But Erick Arguello, the co-founder and president of Calle 24, a Latino business and neighborhood association in the Mission, said any luxury housing project would contribute to the erasure of the neighborhood’s culture and history.
Arguello said the governor’s proposal, which would ease the way for Tillman’s project and others like it, doesn’t respect that neighborhoods across the city have different needs.
“We really can’t have a cookie-cutter type plan because we’ll lose our diversity in San Francisco,” Arguello said.
Arguello said he supports new housing development in the Mission that would be reserved entirely for low-income residents.
Still, even developments that do just that face complaints. Less than a half-mile from Tillman’s project, a developer held a community meeting about a proposed nine-story complex that would create 95 units all for low-income senior citizens. Many neighbors opposed the project, according to a neighborhood news website, voicing concerns about their skyline views.
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