3 ms·

What changed to the planning process to make this work all of a sudden?

by dalyons 4y ago

pclmulqdq 4y ago
Capital flight. CA (the state) is bankrupt and they need the tax money from these properties.
- epistasis 4y ago
  What? No. Everything about this short comment is wrong. Wealthy people are staying in California, it's lower income people that can't pay rent and are leaving. The state's finances have had many years of huge surpluses, when these 3-5 stories were being built. This year's deficit is a tiny fraction of the magnitude of 2022's surplus. Second, the state doesn't see any money from new developments. Property taxes fund county and city budgets, not the state. Finally, despite property tax going to local governments that approve or deny housing, increased tax revenue is almost never part of the decision, and to the degree that tax revenue has come up for residential approvals, it's usually a negative because residential housing is viewed as likely consuming more city budget in services than it generates. Instead, government officials fast track hotels, retail, and other types of land use that generate lots of tax revenue.
  - s1artibartfast 4y ago
    Doesn't the state get its pound of flesh from new home sales and resale? I know this can be offset by purchase of a similar home but has anyone calculated how much it is in terms of the state budget
  - pclmulqdq 4y ago
    Do you have a source showing that lower income people are the ones who are leaving or are you guessing? Bloomberg has pretty convincingly argued that it is actually the middle class (the upper-middle class particularly), those who can afford rent and pay the highest tax load to states, who are leaving places like CA and NY. New York has all but admitted that is the case, too: * https://www.bloomberg.com/news/newsletters/2023-02-16/new-york-vs-florida-how-to-decide-where-to-move-now https://www.bloomberg.com/news/newsletters/2023-02-16/new-yo... * https://www.bloomberg.com/news/articles/2023-01-31/states-with-low-taxes-americans-leave-new-york-moving-to-florida-texas https://www.bloomberg.com/news/articles/2023-01-31/states-wi... * https://www.businessinsider.com/new-york-mayor-eric-adams-ceos-bring-workers-back-office-2022-2 https://www.businessinsider.com/new-york-mayor-eric-adams-ce... * https://www.nbcnewyork.com/news/local/nyc-remote-work-eric-adams-softens-stance-on-working-from-home-for-city-employees/4106612/ https://www.nbcnewyork.com/news/local/nyc-remote-work-eric-a...
    - epistasis 4y ago
      My data comes from a detailed analysis from the LAO, but back in 2018. https://everythingsouthcity.com/2018/02/california-legislative-analysts-office-reports-state-losing-residents-via-domestic-migration/ https://everythingsouthcity.com/2018/02/california-legislati... It follows trends over the past decades in California where for emigration internal to the US, California loses more residents to other states than it gains, and overall population growth comes from international immigration. If there were actually a change in this trend, I wouldn't doubt it, but I wouldn't believe the change unless I saw it from an actual analysis, not from the narratives that the media pushes in terms of fuzzy, sloppy news articles about feelings that get published in the main steam media. The churn of news articles it based on the vibes of journalists, typically their friends and social circles. For example, note the shift from terms headlines; people are leaving "high tax states" for "lower cost", but it's little known that "high tax" California is actually lower tax than Texas, except for those who are very wealthy.
      - pclmulqdq 4y ago
        Trends on mobility of people have changed a lot post-pandemic. I wouldn't put much faith in any data from before 2021. By the way, in 2018, the NIMBYs were still getting their way, so that isn't exactly relevant to the current discussion. At the time, CA was importing a middle class from abroad and losing poor residents. Currently, the importation of that middle class has slowed down a lot, and the existing middle class appears to be moving away. Supposedly, the lower-income bracket also isn't moving around as much because it's harder. You aren't going to get a decade-long analytical post-mortem of this trend until... about 2031. The news stories are what we have, and their underlying data (which you can probably find in FRED if you search enough). Also, I don't know what you consider "very wealthy," but if the line is "people for whom total tax burden in CA is higher than total tax burden in TX," your definition of "very wealthy" is at a much lower income than most people will think - the break-even point is less than $100k of income for many people.
TimPC 4y ago
It’s not so much the planning process it’s literally that small enough developments are exempt from CEQA as of 2018 until 2023. So as long as you’re building below a certain threshold nuisance environmental lawsuits can’t be brought anymore.
- pkdpic 4y ago
  Yeah and I believe they lifted zoning restrictions before covid as long as something like 20% of the units are low income? Somebody might check me on that.
- epistasis 4y ago
  And often it's not even as much an actual lawsuit, but the mere threat of one. The lawsuit doesn't have to be successful or based in environmental reality to stop projects, it merely has to delay construction long enough to force the builder to go get a different loan, pay for the frivolous legal defense, and in the meantime labor costs have risen resulting in having to redo all the planning work around the budget, pro forma, etc. CEQA lawsuit threats would disappear if they were resolved in a timely manner, say 30-60 days. Instead, a multi-year delay will kill projects.
  - TimPC 4y ago
    Yes. CEQA lawsuits are generally inconclusive initially and the first step of the lawsuit is that the builder has to conduct more expensive environmental studies. The studies may result in easy to implement solutions or small environmental impact but there is no liability on the potentially anonymous lawsuit bringer so even if the builder eventually wins they are out the entire costs of the court fight the entire costs of doing the additional assessments and the entire costs of delaying the project.

What changed to the planning process to make this work all of a sudden?

pclmulqdq 4y ago

Capital flight. CA (the state) is bankrupt and they need the tax money from these properties.

epistasis 4y ago
What? No. Everything about this short comment is wrong. Wealthy people are staying in California, it's lower income people that can't pay rent and are leaving. The state's finances have had many years of huge surpluses, when these 3-5 stories were being built. This year's deficit is a tiny fraction of the magnitude of 2022's surplus. Second, the state doesn't see any money from new developments. Property taxes fund county and city budgets, not the state. Finally, despite property tax going to local governments that approve or deny housing, increased tax revenue is almost never part of the decision, and to the degree that tax revenue has come up for residential approvals, it's usually a negative because residential housing is viewed as likely consuming more city budget in services than it generates. Instead, government officials fast track hotels, retail, and other types of land use that generate lots of tax revenue.
- s1artibartfast 4y ago
  Doesn't the state get its pound of flesh from new home sales and resale? I know this can be offset by purchase of a similar home but has anyone calculated how much it is in terms of the state budget
- pclmulqdq 4y ago
  Do you have a source showing that lower income people are the ones who are leaving or are you guessing? Bloomberg has pretty convincingly argued that it is actually the middle class (the upper-middle class particularly), those who can afford rent and pay the highest tax load to states, who are leaving places like CA and NY. New York has all but admitted that is the case, too: * https://www.bloomberg.com/news/newsletters/2023-02-16/new-york-vs-florida-how-to-decide-where-to-move-now https://www.bloomberg.com/news/newsletters/2023-02-16/new-yo... * https://www.bloomberg.com/news/articles/2023-01-31/states-with-low-taxes-americans-leave-new-york-moving-to-florida-texas https://www.bloomberg.com/news/articles/2023-01-31/states-wi... * https://www.businessinsider.com/new-york-mayor-eric-adams-ceos-bring-workers-back-office-2022-2 https://www.businessinsider.com/new-york-mayor-eric-adams-ce... * https://www.nbcnewyork.com/news/local/nyc-remote-work-eric-adams-softens-stance-on-working-from-home-for-city-employees/4106612/ https://www.nbcnewyork.com/news/local/nyc-remote-work-eric-a...
  - epistasis 4y ago
    My data comes from a detailed analysis from the LAO, but back in 2018. https://everythingsouthcity.com/2018/02/california-legislative-analysts-office-reports-state-losing-residents-via-domestic-migration/ https://everythingsouthcity.com/2018/02/california-legislati... It follows trends over the past decades in California where for emigration internal to the US, California loses more residents to other states than it gains, and overall population growth comes from international immigration. If there were actually a change in this trend, I wouldn't doubt it, but I wouldn't believe the change unless I saw it from an actual analysis, not from the narratives that the media pushes in terms of fuzzy, sloppy news articles about feelings that get published in the main steam media. The churn of news articles it based on the vibes of journalists, typically their friends and social circles. For example, note the shift from terms headlines; people are leaving "high tax states" for "lower cost", but it's little known that "high tax" California is actually lower tax than Texas, except for those who are very wealthy.
    - pclmulqdq 4y ago
      Trends on mobility of people have changed a lot post-pandemic. I wouldn't put much faith in any data from before 2021. By the way, in 2018, the NIMBYs were still getting their way, so that isn't exactly relevant to the current discussion. At the time, CA was importing a middle class from abroad and losing poor residents. Currently, the importation of that middle class has slowed down a lot, and the existing middle class appears to be moving away. Supposedly, the lower-income bracket also isn't moving around as much because it's harder. You aren't going to get a decade-long analytical post-mortem of this trend until... about 2031. The news stories are what we have, and their underlying data (which you can probably find in FRED if you search enough). Also, I don't know what you consider "very wealthy," but if the line is "people for whom total tax burden in CA is higher than total tax burden in TX," your definition of "very wealthy" is at a much lower income than most people will think - the break-even point is less than $100k of income for many people.

TimPC 4y ago

It’s not so much the planning process it’s literally that small enough developments are exempt from CEQA as of 2018 until 2023. So as long as you’re building below a certain threshold nuisance environmental lawsuits can’t be brought anymore.

pkdpic 4y ago
Yeah and I believe they lifted zoning restrictions before covid as long as something like 20% of the units are low income? Somebody might check me on that.
epistasis 4y ago
And often it's not even as much an actual lawsuit, but the mere threat of one. The lawsuit doesn't have to be successful or based in environmental reality to stop projects, it merely has to delay construction long enough to force the builder to go get a different loan, pay for the frivolous legal defense, and in the meantime labor costs have risen resulting in having to redo all the planning work around the budget, pro forma, etc. CEQA lawsuit threats would disappear if they were resolved in a timely manner, say 30-60 days. Instead, a multi-year delay will kill projects.
- TimPC 4y ago
  Yes. CEQA lawsuits are generally inconclusive initially and the first step of the lawsuit is that the builder has to conduct more expensive environmental studies. The studies may result in easy to implement solutions or small environmental impact but there is no liability on the potentially anonymous lawsuit bringer so even if the builder eventually wins they are out the entire costs of the court fight the entire costs of doing the additional assessments and the entire costs of delaying the project.