Accommodating Growth, Improving Quality of Life

The challenge is clear. In the next year alone, Southern California’s population will grow by more than 275,000 and the state of California will add half a million residents. In the next five years, that population growth will more than triple.

Employment won’t be the problem. We know approximately where all those people will work. More than 1.6 million additional jobs will be created in Southern California in the next five years, the state Employment Development Department projects.

But nobody knows for sure where all those people will live. This region and the state simply are not building affordable housing nor proper transportation to accommodate swelling numbers of people.

“While there is a need for more than 250,000 new housing units every year, only 126,000 were built last year,” reports Philip Angelides, California’s treasurer.

Highways have become so congested that $14.8 billion is wasted annually on delayed deliveries and idled trucks, the California Chamber of Commerce estimates.

Yet we see no great efforts to build housing and we hear almost no public officials, or private business people, speaking out about these problems.

Enter Angelides. The treasurer recently issued an annual report on California’s borrowing status, which he titled “Smart Investments,” to outline plans for using state money to promote affordable housing.

Angelides, 46, a former real estate developer, has influence over considerable state resources. He oversees the state’s borrowing, which could amount to $38 billion in the next 10 years.

He will have a say in the state’s plans to spend between $68 billion and $94 billion in the coming decade to upgrade its neglected infrastructure of roads and waterways, schools, parks and telecommunications and power facilities.

The treasurer also chairs a committee that controls $450 million in federal and state tax credits to encourage affordable housing.

And Angelides is a board member of the state’s two largest public pension funds, the Public Employees and State Teachers retirement systems, which together have $275 billion to invest.

A small portion of that pension money is already invested in real estate ventures. In the future, fund managers anticipate 14% to 16% returns in such ventures as shopping centers in underserved communities.

Angelides comes to the treasurer’s office at a historic time. Projections of California’s population growth promise a boom comparable to the post-World War II era.

But public spending will be more constrained this time. California won’t be building new freeways as much as finding ways to use existing roads more efficiently.

Angelides’ emphasis will be on housing density--apartment construction and multifamily housing near transportation. That’s the pattern of a housing development Angelides’ own company built south of his native Sacramento.

But density is a fighting word in Southern California. Many communities believe multifamily housing and apartments reduce overall property values. Municipal governments believe that services for more residents drain tax revenue.

That’s why few public officials speak out on the need for housing density. It’s why Los Angeles County, despite a crying need for housing, issued only 4,805 apartment permits last year--less than 10% of the permits issued a decade ago.

And it’s why affordable housing is built out in desert reaches and freeways are clogged bringing workers to and from their jobs.

Changes are needed if the economy is to continue to prosper, says Stephen Levy of the Center for the Continuing Study of the California Economy in Palo Alto.

Five years ago, Levy predicted that California would come out of recession on the strength of high technology, foreign trade, entertainment and tourism and business services--a term covering everything from software to finance.

That prediction was resoundingly correct. But now, Levy says, the challenge is for California to renew its infrastructure and make this a “good place to live--affordable housing, good schools.”

The alternative, he says, is that the state would lose its leading position in the world’s most important industries.

How much of an effect can Angelides have?

Perhaps considerable. His very speaking out can inspire debate and new thinking. His influence over tax credits and other programs should bring more funding to older, poorer cities.

He also would allow communities to pass industrial bond issues for housing by majority vote.

He could be really effective if, as the state’s chief financial officer, Angelides worked to have state government return more of the property tax to the cities that collect it.

Truly, as the housing problem is complex so are the many ways to fix it.

But the payoff could be to give Southern California a rebirth of exemplary housing design. Its current hang-ups about density are misplaced. Economist David Hayes-Bautista, the head of UCLA’s Center for the Study of Latino Health, points out that Los Angeles has far lower housing density than Chicago, Berlin, Toronto, Paris, Tokyo, New York and London.

Nor is density to be feared. In the past, Los Angeles has shown what intelligent design can do for housing--to wit, the garden apartment was invented here, reputedly by developer Selden Ring.

And more than housing design, Southern California has contributed to the world a way of life in which ordinary working people live in an urban community but retain their patch of ground and individual privacy on a scale that bespoke riches in former times.

With his call for “Smart Investments” to renew urban landscapes, Angelides wants to revive that spirit of innovation in Southern California. It’s a healthy challenge.

James Flanigan can be reached by e-mail at jim.flanigan@latimes.com.

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Room to Grow

Los Angeles Has lots of space compared with some of the world’s other major metropolitan areas. People per square mile:

Manhattan: 64,922

Paris: 53,079

Tokyo: 38,819

Toronto: 14,239

Chicago: 13,180

London: 11,094

Berlin: 8,982

Los Angeles: 6,384

Source: Center for Study of Latino Health, UCLA