4 ms·

So rather than repeal laws so that people can build housing... ...we should pass more laws mandating that the housing we can't build should be built anyhow, ap

by Lazare 8y ago

So rather than repeal laws so that people can build housing... ...we should pass more laws mandating that the housing we can't build should be built anyhow, apparently by magic? > If Menlo Park wants to allow Facebook to build an office complex to support 2,000 more Facebook employees than it needs to create 2,000 more residential options for those employees. And when you say Menlo Park "needs to create", you mean, they need to relax the zoning laws in the way SB827 would have mandated so that those houses can be built? Because otherwise, how is this meant to happen?

oceanghost 8y ago
"When the only tool you have is a hammer, everything starts looking like a nail."
candiodari 8y ago
You have just come across the frustration every lawyer has starting from the 2nd week of law school. It never ends, I'm afraid.
sfnrm 8y ago
The lurking issue here is Prop 13. It forces cities into a tragedy of the commons type scenario where it's not rational for any individual city to build new housing, as property taxes are limited, while they can more easily raise revenue by bringing in jobs and retail. >...we should pass more laws mandating that the housing we can't build should be built anyhow, apparently by magic? Unfortunately, it seems like Prop 13 is not going to get repealed anytime soon. Given that, then in this case, yes, more regulations could help. It's called a Pigouvian tax [1]. Whenever a city like Menlo Park brings in 2,000 more Facebook employees while allowing for zero new housing, they impose a negative externality on their neighbors, who suffer in the form of higher housing costs. To counter that, cities should be made to bear the social cost of exacerbating the housing crisis. If every time a city like Menlo Park adds thousands of new employees without any new housing, they had to pay large fees into a state affordable housing fund, they'd have less incentive to contribute such a large housing imbalance in the first place, and everyone would be better off. [1] https://en.wikipedia.org/wiki/Pigovian_tax https://en.wikipedia.org/wiki/Pigovian_tax
- jpao79 8y ago
  Agreed. If Menlo Park can't convince its current residents to build more housing, it should share the tax base that the 2,000 new employees bring in with the adjacent neighboring towns which do build the housing in order to help them handle the additional loading on their municipal infrastructure (roads, housing, police/fire). Or they should encourage FB to look at Oakland, Fremont, Hayward, San Jose for their expansion needs.
- niftich 8y ago
  Prop 13 contributes to making this situation worse, but the scenario you laid out is actually how development happens in the US, regardless of where you are. Municipalities at the edge of a built-up area realize there's an overspill of demand, and they can attract development because they can offer lower land values, higher lot sizes, and lower property taxes than areas that are already built out. Typically, residential demand is higher than others, and private developers persuade town officials to let farmland be upzoned for homes and subdivisions. Typically, everybody wins a little: the municipality gains significantly more revenue from property taxes on the re-assessed land, developers, barring a sudden downturn, usually turn a profit, and potential residents have more options for housing. This works well for greenfield development. But once a town is built out, the calculus is different. For developers, the costs of buying out adjacent parcels is greater, and the marginal profits are less. This is why you predominantly see "luxury apartments" built during redevelopment, instead of, say, middle-income walk-ups, to improve margins further. These forces cause them to gravitate towards greenfield development further out (e.g. Gilroy, Tracy, Stockton, Woodland), or to focus on redeveloping areas that have the highest profit potential (ex-industrial urban revival districts). Meanwhile, for the towns themselves, 30, 40 years after having been built out with single-family homes, the benefits of further residential development have all but evaporated: the sewers need replacing, and the = schools require more and more funding to keep at their target level of service to retain discretionary, high-income residents. Smart suburbs typically shift their focus to attracting employment, like manufacturing or office space. The Bay Area is much more fortunate than other regions of the country in this regard, as most of the employment base developed organically, rather than having to attract out-of-town businesses to start satellite facilities. Nonetheless, communities still vie with one another over employment, as new jobs are much lighter on the budget than more residents. Ever since streetcar suburbs were established, the natural state of development has been that towns in earlier stages of their existence would pick up spillover residential demand, while built-out areas focus on attracting and retaining jobs.
moultano 8y ago
You can't "repeal" local zoning at the state level. You can only place restrictions on that zoning. So yes, we need state laws that limit the power of local governments to restrict housing construction.

by Lazare 8y ago

oceanghost 8y ago

"When the only tool you have is a hammer, everything starts looking like a nail."

candiodari 8y ago

You have just come across the frustration every lawyer has starting from the 2nd week of law school. It never ends, I'm afraid.

sfnrm 8y ago

The lurking issue here is Prop 13. It forces cities into a tragedy of the commons type scenario where it's not rational for any individual city to build new housing, as property taxes are limited, while they can more easily raise revenue by bringing in jobs and retail. >...we should pass more laws mandating that the housing we can't build should be built anyhow, apparently by magic? Unfortunately, it seems like Prop 13 is not going to get repealed anytime soon. Given that, then in this case, yes, more regulations could help. It's called a Pigouvian tax [1]. Whenever a city like Menlo Park brings in 2,000 more Facebook employees while allowing for zero new housing, they impose a negative externality on their neighbors, who suffer in the form of higher housing costs. To counter that, cities should be made to bear the social cost of exacerbating the housing crisis. If every time a city like Menlo Park adds thousands of new employees without any new housing, they had to pay large fees into a state affordable housing fund, they'd have less incentive to contribute such a large housing imbalance in the first place, and everyone would be better off. [1] https://en.wikipedia.org/wiki/Pigovian_tax https://en.wikipedia.org/wiki/Pigovian_tax

jpao79 8y ago
Agreed. If Menlo Park can't convince its current residents to build more housing, it should share the tax base that the 2,000 new employees bring in with the adjacent neighboring towns which do build the housing in order to help them handle the additional loading on their municipal infrastructure (roads, housing, police/fire). Or they should encourage FB to look at Oakland, Fremont, Hayward, San Jose for their expansion needs.
niftich 8y ago
Prop 13 contributes to making this situation worse, but the scenario you laid out is actually how development happens in the US, regardless of where you are. Municipalities at the edge of a built-up area realize there's an overspill of demand, and they can attract development because they can offer lower land values, higher lot sizes, and lower property taxes than areas that are already built out. Typically, residential demand is higher than others, and private developers persuade town officials to let farmland be upzoned for homes and subdivisions. Typically, everybody wins a little: the municipality gains significantly more revenue from property taxes on the re-assessed land, developers, barring a sudden downturn, usually turn a profit, and potential residents have more options for housing. This works well for greenfield development. But once a town is built out, the calculus is different. For developers, the costs of buying out adjacent parcels is greater, and the marginal profits are less. This is why you predominantly see "luxury apartments" built during redevelopment, instead of, say, middle-income walk-ups, to improve margins further. These forces cause them to gravitate towards greenfield development further out (e.g. Gilroy, Tracy, Stockton, Woodland), or to focus on redeveloping areas that have the highest profit potential (ex-industrial urban revival districts). Meanwhile, for the towns themselves, 30, 40 years after having been built out with single-family homes, the benefits of further residential development have all but evaporated: the sewers need replacing, and the = schools require more and more funding to keep at their target level of service to retain discretionary, high-income residents. Smart suburbs typically shift their focus to attracting employment, like manufacturing or office space. The Bay Area is much more fortunate than other regions of the country in this regard, as most of the employment base developed organically, rather than having to attract out-of-town businesses to start satellite facilities. Nonetheless, communities still vie with one another over employment, as new jobs are much lighter on the budget than more residents. Ever since streetcar suburbs were established, the natural state of development has been that towns in earlier stages of their existence would pick up spillover residential demand, while built-out areas focus on attracting and retaining jobs.

moultano 8y ago

You can't "repeal" local zoning at the state level. You can only place restrictions on that zoning. So yes, we need state laws that limit the power of local governments to restrict housing construction.