Make housing cheaper? Here’s how California lawmakers are getting started in 2020

Gov. Gavin Newsom signed housing laws during his first year in office that aimed to protect tenants from egregious rent increases, prevent discrimination against people who pay rent with vouchers, and block cities from stymieing new construction.

But the year concluded without Newsom signing a game-changing law that would spur construction of new homes, which is largely seen by advocates and lawmakers as the key to solving California’s housing crisis.

California local governments as of November were on pace to approve building permits for 111,000 new housing units in 2019, down from 117,000 in 2018. Newsom while running for governor set a goal of building 3.5 million new homes by 2025, which amounts to 500,000 new housing units per year.

The 120 members of the Legislature are reconvening in Sacramento on Monday for the second half of a two-year session with increased pressure to focus their attention on speeding production of millions of new housing units.

“I think the administration working with the Legislature has set the stage for a significant push on preservation and protection,” said Assemblyman David Chiu, chairman of his chamber’s housing committee and author of the law that caps rent increases.

“But I think it’s incumbent on all of us in Sacramento this year to double down particularly on production,” the San Francisco Democrat continued. “That has to be the focus of 2020.”

Housing advocates are banking on the Legislature to deliver what David Garcia, policy director of the Terner Center for Housing Innovation at UC Berkeley, has called the “ultimate solution” to the increasing crisis: policies to construct housing for Californians of every demographic and income level.

Here are some of those ideas:

Rewriting zoning laws

Expect Sen. Scott Wiener’s top priority this year to be sending a bill to Newsom’s desk that would knock out the restrictions local governments place on new development.

Wiener carried a high-profile zoning proposal, Senate Bill 50, in 2019 that was left in the dust in May after Senate Appropriations stalled it. It would have required local governments to allow for denser housing near transit-rich areas.

Critics of SB 50 said the legislation signaled the end to single-family neighborhoods. Others said it would exacerbate gentrification in communities of color in urban areas.

Wiener, D-San Francisco, converted SB 50 into a two-year bill, giving the proposal another chance to reach Newsom. Wiener has pledged to “put an end to the restrictive, exclusionary, low-density zoning” through the bill.

“We have to ramp up housing production and so, yes, keeping renters stable in their housing is incredibly important. Funding affordable housing is incredibly important. But in the long run, to solve this problem, we have to build millions of homes,” Wiener said. “And it’s too hard to build housing of any type in California. We have to make it easier.”

Newsom in recent months has advocated for policies like the one Wiener is proposing.

“We need to continue this kind of energy to focus on increasing that supply,” Newsom said in October during a ceremony to sign housing legislation. “Continuing to do the good work that Scott Wiener has been doing raising the issue of production in this state, and trying to do what he can to help his colleagues be convinced that they’re going to survive if they just come on over and help support, a little bit more, an indulgence in the construction side of things.”

Funding affordable housing

Lawmakers also want to find more money to spur redevelopment construction.

Newsom rejected legislation last year to authorize an eventual $2 billion in funding for affordable housing, saying in his veto message of Senate Bill 5 that such costly proposals should “be part of budget deliberations.”

Sen. Jim Beall, the San Jose Democrat who wrote SB 5, said fixing the housing crisis “can’t be done overnight with one-time funding” and his office confirmed he would reintroduce SB 5 on Monday.

Advocates have instead urged Newsom in a November letter to commit $5 billion in his January budget for affordable housing initiatives.

The coalition of 11 groups that penned the letter asked for a permanent expansion of the low-income housing tax credit and funding for extremely low-income housing options, saying the scale of the crisis “calls for bigger, transformative solutions.”

A priority for the California Housing Consortium, which signed on to the letter, is to streamline the Housing and Community Development Department’s affordable housing application process, a “highly technical” idea for a bill, said the group’s lobbyist Marina Wiant.

“But I think it will be meaningful and make it easier for both the state and the development community to underwrite and develop critical and affordable housing units,” Wiant continued.

Two more bills that stalled in 2019 could return. One proposal would make it easier for voters to approve bonds to build affordable housing by lowering the threshold for passage. Another would reform how cities calculate and impose fees on new development.

Tackling homelessness

Chiu said lawmakers will likely take up a debate on whether homeless people should have a “right to housing,” and then discuss how to finance an initiative to build more shelters and increase mental health care.

“The conundrum that we see around California is that every resident in every city says we have a homeless crisis and we need to do something about it,” Chiu said. “But when it comes to who makes the investment and where housing should be built, everyone says someone else ought to do it.”

Assemblyman Miguel Santiago’s legislation was signed last year to allow Los Angeles to speed up the environmental review process for emergency and supporting housing projects, a success his office said he plans to expand to a statewide policy this year.

“Homelessness is a humanitarian crisis of biblical proportions. Families are living in tents and people are dying on the streets,” Santiago, D-Los Angeles, said in a statement to The Sacramento Bee. “The shortage of homeless housing is not just confined to LA City. You see it everywhere in the state. If California wants to get serious about keeping people off the streets and building homeless housing faster, then we must start by removing barriers.”

This story was originally published January 5, 2020 at 5:00 AM with the headline "Make housing cheaper? Here’s how California lawmakers are getting started in 2020."