Regional housing plan splits elected leaders

A sweeping package of proposals to preserve and expand the Bay Area’s housing stock by passing new renter protections, loosening zoning restrictions and expediting the approval process for residential developments is making its way to the state Legislature despite a flurry of opposition from local leaders, many of whom decry the proposed policies as unfair, anti-democratic and potentially counterproductive.

Known as the “Casa Compact,” the plan was hashed out over an 18-month period by a committee created by the regional agencies Association of Bay Area Governments (ABAG) and the Metropolitan Transportation Commission (MTC), which focus on housing and transportation policies. The Casa Steering Committee, whose roster includes area council members, developers, planners, union leaders and representatives from large employers such as Google, Facebook and Genentech, voted unanimously on Dec. 12 to approve the new document. The MTC board followed suit with its own approval, by an 11-4 vote, on Dec. 19. The ABAG executive board is expected to follow suit shortly.

Proponents of the plan are describing it as a 15-year “emergency policy package” for confronting the Bay Area’s housing crisis. The preamble to the document notes that since 2010, the Bay Area has added 722,000 jobs but constructed only 106,000 housing units, a discrepancy that has caused housing prices to go through the roof, spurred more homelessness and exacerbated the transportation crisis by forcing more employees to commute from other regions.

The Casa Compact includes 10 elements that aim to address these challenges but that, in doing so, would impose policies that have already proven to be highly contentious or unpopular at the local level. These include a policy requiring landlords to cite “just causes” for eviction and to provide relocation assistance to tenants who experience no-fault evictions, such as when the property owner wants to move in, the unit is deemed unsafe or it is removed from the rental market. Another element calls for capping annual rent increases at 5 percent plus the consumer price index. A third would guarantee free legal counsel and emergency rent assistance to low-income tenants.

Other elements focus on new housing. One calls for requiring automatic approval of accessory-dwelling units (also known as in-law or granny units) in all residential zones. Another would institute “minimum zoning” within a quarter mile of rail stations and ferry terminals, which would allow residential developments up to 55 feet tall (or 75 feet tall if they obtain density bonuses). In areas within half mile of bus stops, the new law would allow for residential buildings up to 36 feet tall. In both cases, the element makes an exception for “sensitive communities,” those made up predominantly of low-income residents who face a greater threat of displacement from the up-zoning policies. These communities would be granted a three-year deferral period so that they can plan for the proposed growth.

The compact also calls for an expedited approval process for housing projects that comply with zoning, with exemptions from the California Environmental Quality Act and a limit of one year and three hearings before approval.

Steve Heminger, executive director of MTC and ABAG, told the Casa Steering Committee last month that these policies are “trying to tune up the housing-production delivery machine, which I think it’s fair to say is leaking plenty of oil these days and is not producing with sufficient speed, with sufficient certainty, the kind of new housing stock that we need.”

The compact also includes two elements pertaining to funding, one calling for $1.5 billion in annual revenues to support the Casa Compact through some combination of contributions from taxpayers, developers, employers, property owners and local governments. (It does not proscribe a particular financing method but creates a menu of options.) Another would establish a new entity called the Regional Housing Enterprise to levy fees, pursue new taxes, disburse funds and oversee new housing programs.

The compact does not, in itself, establish these policies. But by approving it, members of the Casa Committee hope the state Legislature would take the document and pass legislation that implements some, if not all, of its suggestions.

In voting to approve the compact on Dec. 12, Steering Committee members characterized it as a necessary, if imperfect, compromise. Michael Covarrubias, president of TMG and one of the chairs of the Casa committee, said the elements in the compact reflect proposals that, for the most part, had already been proposed but that failed to advance in the past year.

An effort to strengthen rent control fizzled when voters opted in November not to repeal Costa-Hawkins, the state law that limits cities’ powers to impose rent-control. Legislation pertaining to just-cause evictions and accessory-dwelling units similarly failed to advance in the last session, while Scott Wiener’s proposed Senate Bill 827 got “beat up.”

“All these children have been waylaid by the side of the road,” Covarrubias said. “So what we said was, ‘If we’d put them all together and we don’t let them break apart and we give them to the Legislature, which is the body that will take it down the freeway, there is a shot.'”

Several committee members expressed reservations about particular elements, though none actually opposed the compact. Oakland Mayor Libby Schaaf suggested that “sensitive areas” (including large parts of Oakland) be given more time and resources to plan adequately. Santa Clara County Supervisor Dave Cortese said he was concerned about the prospect of “revenue displacement,” the flow of local revenues to regional sources. He was less concerned about the issue of local regulatory control, which he called “pretty minor.”

Dave Regan, president of SEIU-United Healthcare Workers West, went a step further and made a case for more top-down regulation.

“The housing situation in California is a massive public policy failure,” Regan said at the Dec. 12 meeting. “All of these comments about how we need more ‘democracy’ — that’s what provided this problem. And saying we need years more of this is going to make it more intractable, not less intractable, because every day there are more people in tents.”

The compact has won the support of some elected leaders, including Schaaf, San Jose Mayor Sam Liccardo and San Francisco Mayor London Breed (all three sat on the Casa Steering Committee). Yet the push for more state regulations has also galvanized pockets of oppositions, with many mayors of smaller cities and towns submitting letters that bemoan their own lack of involvement in the discussion. By imposing these policies, critics maintain, the package of laws threatens to upend existing efforts by cities to promote housing.

Palo Alto Councilwoman Liz Kniss, a vocal housing advocate who served as mayor in 2018, was among those who urged the MTC not to endorse the Casa Compact.

“Unfortunately, adhering to a Casa Compact, created without our city’s involvement, would circumvent this public, community process,” Kniss’ letter states. “Additionally, the compact does not appear to take into consideration the local land use laws of each Bay Area city, the plans each city has in place to meet its housing needs in the near future, or the housing needs of the residents in each city.”

She is hardly alone. In a letter, Sunnyvale Mayor Glenn Hendricks slammed the compact’s “one size fits all policy” and took issue with the document’s proposed funding strategies, particularly its call for diverting 20 percent of property tax growth across the region, a policy that he argued would “result in significant cuts to core services in every Bay Area city.” A letter from Cupertino complained about “minimal outreach to local governments” and “pre-emption of local control over zoning regulations, inclusionary requirements and design review.”

In Los Altos, the council took a stand against the compact, arguing that its funding strategies are “not feasible” and that it “overstates the benefits of transit-oriented development and the ability of transit systems to truly accommodate the increased density.”

Anita Enander, a member of the Los Altos City Council, spoke out against the compact at the Dec. 12 meeting of the Casa Steering Committee. She called the package of proposals a “massive Band-Aid that doesn’t address root causes” and an affront to local control.

“If you think local governments will welcome being relieved of having to deal with housing proposals, if you think we want a mandated ministerial approval process with setbacks and height limits and incentives mandated by law, you are wrong,” Enander said. “The people elected us to make that decision. It’s our job.”

Jeannie Bruins, a Los Altos councilwoman who represents north Santa Clara County cities on the MTC, was part of the dissenting minority. The biggest concerns that she’s been hearing from the cities, she said, pertained to insufficient outreach and funding. Many believe money will flow from their governments to the three largest Bay Area cities, she said.

She also noted that some of the policies that the Steering Committee had embraced are proving less popular at the local level, as evidenced by the 2018 election in which several council members who supported aggressive pro-housing policies (including Lenny Siegel in Mountain View and Cory Wolbach in Palo Alto) were voted out.

“We all want to be part of the solution, but what we ended up with was that anybody who had any inkling for supporting housing or for supporting trying to deal with and addressing homelessness … those are incumbents who lost their seats,” Bruins said. “The time to engage the cities is today, while you still have people sitting on councils who really want to be part of the solution, before you have those people replaced by people who are more in line with the NIMBYs.”