Tackling Exclusionary Housing Policy in California


This continues a series of essays on California’s complex housing affordability crisis, and the need for regional, place-based solutions.

The current essay dives into the issue of exclusionary practices that have exacerbated the housing crisis and offers some policy solutions.

Affordable housing production policies must include complimentary solutions that address preservation and resident protection. Photo from © 2018 navalwiki.info.

It is a given that the people of California are facing an unprecedented housing crisis. One face of that crisis is the experience of thousands of renters facing evictions, displacement, and the wholesale gentrification of their communities (along with the experience of low-income homeowners still dealing with the consequences of the foreclosure crisis). The other face is the dramatic decline in overall production of housing over the last decade.

The exclusionary housing policies of many cities in the Bay Area region have undoubtedly contributed to the crisis, and should be targeted as part of a package of solutions.

When the California legislature reconvenes in January, it will have a chance to revisit important housing and land use policies. Looking back on last year’s legislative “Housing Package,” it is significant that all the proposals attempted to address “production” of housing, however not a single bill dealt with the protection of existing communities from displacement or the preservation of existing “naturally affordable” housing from the speculation market.

We can probably expect another package of production bills from the State legislature in the coming year, including Redevelopment 2.0, an increase to tax credit funding, or new “missing middle” and “accessory dwelling unit” policies. These are fine solutions, but most policy advocates now agree that the State is not going to simply build its way out of these dual housing crises. The challenge will be to balance the legislature’s emphasis on housing production with other complementary policies — in other words, advancing “The 3 Ps” of Production, Preservation and Protection.

As this current legislative session wraps up, the experience with the divisive battle over Senate Bill-827 should not be a lost lesson. It is notable that tenants, low-income homeowners and communities of color were not part of the conversation around the legislation, nor were the myriad of fair housing, affordable housing and social justice organizations across the state that work to support and protect those vulnerable communities.

The challenge will be to balance the legislature’s emphasis on housing production with other complementary policies — in other words, advancing “The 3 Ps” of Production, Preservation and Protection.

The conversation must include those who would be directly affected by the proposed policies, not just the real estate lobbyists and policy wonks that dominated this past year’s discourse. Otherwise, we are likely to see a repeat battle of SB-827 pitting smart-growth and “yimby” advocates against affordable housing and housing justice advocates.

The Complexity of the Problem

First, it’s important to be grounded in the factors that have contributed to the housing supply crisis. It is not, as some lawmakers and journalists claim, a crisis simply based on 50 years of underproduction caused by exclusionary policies.

During the period of suburban expansion from the 1950s through the 1970s, the annual rate of housing growth in the Bay Area was much faster than population growth¹. Housing production compared to population growth flattened in the 1980s, and slowed after the recession of 1990, but then shot up again between 2000 and 2008. And then the pace dropped dramatically after 2008.

Did exclusionary housing policies go away in those boom cycles, only to reappear in 2008?

No, what happened was that the economy shattered. In 2008, housing production fell drastically, and is even now, ten years later and six years into the tech economy boom, only at two-thirds it’s average level from 1990 to 2008. And that is largely as a result of the decimation of suburban single-family and townhouse construction since the crash of 2008.

Admitting that there are far larger economic forces at work here does not mean we do not have an ethical and moral need to address exclusionary policies when and where they exist. However, it is clear that this is only a part of the bigger crisis of underproduction that has befallen the state since the 2008 Great Recession, and a perfect storm of factors that have completely changed the real estate market and thus our understanding of the housing policies needed going forward .

For the moment, however, let’s focus on the policies used by many cities to slow or stop housing development. Focusing on exclusionary policies is important because it was a primary frame used by the proponents for last year’s embattled SB-827 legislation, despite the fact that many if not most of the areas that would have been affected by the bill were historically working class and immigrant communities of color. And indeed, we should all agree that targeting persistent exclusion with the right policies is one necessary step to addressing the State’s housing crisis.

Exclusionary Housing Policies: A History

Development in the U.S. has always been defined by racially segregated cities: one side of the tracks, and “the other side of the tracks.” The rise of suburban sprawl saw policies of racial segregation and exclusion spread across metropolitan regions: primarily through the GI Bill and real estate industry policies of block-busting and redlining abetted by the Federal Housing Administration’s underwriting guidelines. Regional segregation was encouraged by massive Federal investment into the highway system, enacted shortly after the Supreme Court decision of Brown vs. Board of Education, mandating the desegregation of urban school districts.

These policies allowed whites to move to exclusive middle-class suburbs and separate school districts.

These racial policies also created areas of concentrated resources (and concentrated whiteness) that were maintained through land use laws, particularly zoning that mandated minimum-size lots and large single-family homes, but prohibited apartment buildings. But as the example of Houston demonstrates, you don’t need zoning to create exclusionary policies: that can occur just as well though separate suburban police forces, mortgage systems, strict occupancy limits, stringent Home Owner Associations and restrictive covenants.

Regional segregation was encouraged by massive Federal investment into the highway system, enacted shortly after the Supreme Court decision of Brown vs. Board of Education, mandating the desegregation of urban school districts.

That history also created the conditions where communities of color in inner cities were denied social rights and a sense of self-determination. They faced the disparate impacts of urban renewal, were prohibited from access to homeownership, and experienced disinvestment in schools, housing and transit. These communities were denied a political voice to decide what investment came into their neighborhoods and to what end. Richard Rothstein’s recent book The Color of Law has re-exposed the details of much of that history and argues that we are still bearing the consequences of these policies.

Exclusionary Housing Policies Today

Today, as if to rub salt in the wounds from decades of government and social disinvestment, inner city communities of color are now seeing new modern transit investments that trigger new cycles of gentrification (called by some “transit-oriented displacement”), and new urban housing development that is far out of reach of anyone in the neighborhoods.

Ironically, many of the more modest outlying single-family suburbs, originally built as racially segregated neighborhoods for the white working class, are now becoming the new receiving grounds for people of color being displaced from the urban core. This further complicates the current narrative of linking single-family homes with racial exclusion.

Indeed, San Francisco’s Bayview district, a primarily single-family housing area, has been able to maintain some semblance of diversity due to its relatively high rate of African-American homeownership.

A primary criticism of SB-827 is that although it was framed as an attack on exclusionary policies, it in fact was a one-size-fits-all hammer over many communities of color. These communities happened to be near transit nodes, which the bill would have automatically “upzoned” (ie, allowing greater heights and densities that landowners and developers could profit from). This would have resulted in further extending the racialized impacts of redlining and urban renewal by continuing to deny them voice and decision-making in their own futures.

One demand made by the affected communities is that they should be exempted from these kinds of state preemption policies that would harm marginalized communities.

However, a different approach might be to actually address the problem as it was originally framed by the bill’s authors: to target and tackle exclusionary policies head on where they are.

There are ongoing examples of exclusionary land use policies that reinforce regional racial and economic segregation, and keep the Bay Area from growing in a truly inclusive fashion.

Policy barriers include zoning that only allows single-family large-lot development, or that block the ability of homeowners to add new units on their own properties. Some cities prohibit new apartment buildings even near transit. There are planning departments and commissions that refuse to approve new housing at all or demand reductions in densities or heights despite existing zoning. There are some jurisdictions that do have multifamily zoning, but only in areas that are very difficult to develop.

Then there are jurisdictions with acres of develop-able land slated to be big box retail centers and commercial office parks with thousands of new jobs, and no housing at all for any of the workers at the different wage levels. Finally, there are those cities that not only do not fund affordable housing, but also routinely deny approvals, or place excessive demands on affordable projects.

Whether intentional or not, these policies add to existing market dynamics to keep out certain kinds of housing that might bring in newcomers to a community.

Solutions need to tackle the privileges that white suburban communities have gained through decades of exclusionary policies, without simultaneously triggering perverse outcomes that exacerbate the wealth inequities and displacement risks that marginalize so many other communities.

Some of these examples are smack-dab in the middle of transit nodes, but many other exclusionary geographies may not fall into the currently popular framing of “Transit-Oriented Development” (TOD). High-resource housing opportunity areas can be identified along commercial corridors and around downtowns and shopping districts throughout the vast suburbs of California, whether transit infrastructure has been built yet. It is not rocket science to rethink the traditional suburbs (as we write about in a previous essay).

Undoing these policy barriers will not necessarily undo the economic barriers to housing construction and particularly housing that is affordable to most people, but without these actions, housing production can be an impossibility in many places, contributing to an ever-more segregated Bay Area and California.

Addressing the Problem

These concrete examples of exclusionary housing policies can allow us to point to some of the policy solutions that the next State legislative session can attempt to address, before it gets caught up again in ill-formed, however unintentional, attacks on working class and communities of color.

  1. Housing Element Law: Address cities that don’t zone for enough housing, don’t zone for multifamily housing, or only allow low density on large sites (those 1/4 acre ranchette lots). (Assembly Bills 686 and 1771, both now on the Governor’s desk for signature, are examples of good policy that will begin putting teeth into Housing Element compliance)
  2. Housing in existing commercial areas: In exclusionary cities with low housing production, allow residential on large underutilized commercial/big box/strip mall sites over 1 acre (irrespective of transit proximity), with lower inclusionary requirements for missing-middle 40’ buildings in cool markets and higher inclusionary for 55’-85’ buildings in hot market/transit-served areas.
  3. Housing requirements for Commercial Expansion: Address cities that prefer and zone primarily for commercial office and retail with little or no housing. The legislature could require a Jobs-Housing Fit analysis in all master plan development over 2 acres, identifying the estimated jobs growth by wage level, and mandate that the appropriate housing needed for the new worker households be provided as part of the development plan through a combination of market-rate housing, on-site inclusionary housing, and dedicated affordable housing sites.
  4. Barriers to housing approvals: Address cities or neighborhoods that stop all housing or reduce density through the approvals process. A process is needed to identify the problem and sort out so-called “bad actor” cities from good actors, and then challenge those cities to correct the problem. SB 35 streamlining is already the “stick” that will now push those places.
  5. Affordable housing zoning: Affordable housing faces particular barriers in approvals and zoning in many jurisdictions. For affordable housing, zoning densities and heights should be relaxed throughout to allow for 55’ buildings (generally the most efficient building type in most cities), with streamlined approvals.
  6. Affordable housing barriers: Exclusionary cities have been notorious in denying approval for affordable housing, or allowing it only on the most difficult and undesirable sites. Despite the Trump Administration’s attempt to roll back Affirmatively Furthering Fair Housing, the State of California has an immediate opportunity to link state disbursements of infrastructure money, whether for transportation or parks, to the approvals and funding for affordable housing to these already well-resourced jurisdictions.

Exclusionary land use policies should be a clear target for statewide policy reform, along with the proactive work of dedicating sites and funding for affordable housing, protecting tenants and communities at risk of displacement, and preserving the “naturally affordable” multifamily rental housing we already have in our communities.

For politicians it can often be easier to fetishize a good-sounding technical solution such as “streamlining” or “upzoning”, whatever its unintended consequences, rather than embrace the complexity of the public policy problem to be solved. It is even harder to address a problem like housing access and affordability that is, at its core, based on the dynamics of racial and economic inequality. Solutions need to tackle the privileges that white suburban communities have gained through decades of exclusionary policies, without simultaneously triggering perverse outcomes that exacerbate the wealth inequities and displacement risks that marginalize so many other communities. That is the challenge of tackling exclusionary housing policy in California.

In this age when the national government seems to be drifting in a different direction, we need to hold our State policy leaders accountable to ‘get it right’ by rising above divisive race and class political opportunism, and to work together on real housing solutions that includes producing a fair share of housing and protecting existing residents across the communities of California.



Council of Community Housing Organizations

Leading San Francisco’s affordable housing movement since 1978, fighting for funding & policies to make SF affordable.