Transcript
Speaker: Hello and welcome to John Nerds Out on California Housing Legislation. i am John. This update is going to be just on four bills, two of which I have explained the details of before, and two of which are new ones that I wanted to let people know about.
Speaker: These are all on the subject of housing, more or less, and there is some good news and some not so good news. Three of these four bills are moving forward, though, and there is a big struggle ahead, but there is a lot of hope this year that we are going to achieve something big.
Speaker: Sorry for the interruption. This is John from the future, interrupting myself on my own podcast. First to apologize for not putting out a new episode in a while. I recorded what you've just been listening to about a month ago. it is now June 25th, and I was right in what you just heard me say, that there was a lot of conflict and a lot of potential in these three surviving bills.
Speaker: I will say as of June 25th, all three of them survive. A whole lot has happened and they are still hopefully going to succeed, but there will be more to tell. So I will be getting out an update to the episode you're about to hear as soon as possible.
Speaker: But I think it is still worthwhile, all the stuff that had happened when I recorded this past episode. So I will return you to it. Enjoy.
Speaker: One of the big bills that I talked about last time is Senate Bill 79 by Scott Wiener. It has had some twists and turns, and I have been very concerned for its fortunes over the last couple of weeks.
Speaker: But it has survived, and it's been pretty inspiring so far, but it has a lot of veto points to go. As a reminder, Senate Bill 79 up zones within half a mile of transit stations, allowing a lot more housing to be built up to, in some cases, 75 feet along those stations that were usually urban metro systems like BART, some commuter rail, light rail, and and bus routes in some cases.
Speaker: One of the big things I've been observing with regret is that although a lot of the arguments seemed to have been had about the utility of housing at all income levels and not demonizing market rate housing, because 80% of people live in market rate housing, and other experience also suggesting that it's a huge part of solving the housing crisis and to boot, one that does not require public subsidy,
Speaker: A lot of the same old bad arguments seem to have a zombie existence when people are in the business of opposing housing. And there are people opposing this, even though the legislature is probably more amenable than it was five years ago when Senate Bill 50 failed.
Speaker: We are still seeing the nature of the legislature with so many committees for it to go through, so many veto points. That it has nearly died a couple of times now.
Speaker: Both times it has survived. And it has not, fortunately, been amended into oblivion, which is something that hostile committees sometimes do. They make amendments that effectively make it valueless.
Speaker: SB 79 has been amended a bit. The biggest changes I see at the moment... are that the definition of transit-oriented development stop, remember there was Tier 1, Tier 2, and Tier 3 that allowed for different heights, you know, 75, 65, down to 45.
Speaker: Those definitions have changed. It used to be that they included... bus stops along a bus route that had bus only lanes, not necessarily just bus rapid transit.
Speaker: Now, tier one is simply heavy rail transit or very high frequency commuter rail, where very high frequency means 72 trains a day. Tier two, a little lower buildings allowed, but still apartment buildings, is high frequency commuter rail,
Speaker: which means only 48 trains a day, or bus rapid transit. Tier three is any other major transit stop, such as commuter rail, that is less than that standard of 48 day, but is more than per day.
Speaker: and ferry stops. As I read it, it actually excludes a kind of major transit stop that has otherwise been included in this kind of legislation. And that's that right now the law defines major transit stops as including all the things I mentioned, rail, ferry, but also regular buses where there are two relatively frequent bus services and they intersect each other. That is called a major transit stop.
Speaker: Well, the SB 79 legislation specifically says that Tier 3 is any other major transit stop but the kind with frequent commuter rail service or ferry service.
Speaker: So I think it's excluding regular bus lines. Unfortunately, that thing about allowing the entire stretch of a bus route when even a block of it had a bus only lane which would have been great for Oakland, does seem to have been amended out. It might have been an unintended consequence, but everything about bus-only lanes is gone now.
Speaker: The other change that was made more recently, I think after the second committee, was that the heights are a little more fixed now. Because before it said you can build up to like 75 feet around a heavy rail station or within quarter mile of a heavy rail station.
Speaker: But it was understood that 75 feet was the starting point. And if you use the density bonus law, you added affordable units and that gave you the bonus market rate units.
Speaker: Then you could increase the height as needed to accommodate those extra units. And you could perhaps even double that height sometimes. Well, now there has been some extra text added that basically says the local government is not required to grant a waiver of the height under the density bonus law.
Speaker: So that basically means that the height will be fixed in most cases. Although city government could choose to allow the height to go above 75 or whatever the base standard is.
Speaker: But in many cases, they probably won't. And an interesting exception, as is often the case, is they allow for exceptions when it is 100% affordable because 100% affordable projects get a lot more benefits in the density bonus law than just 10 or 20% affordable.
Speaker: So those would be able to break the height limits. But overall, it's not a huge difference. They have not, importantly, added any affordability standards. It does not say that it has to be built with skilled and trained labor, which is effectively the same as scarce unionized labor, which is something that the building and construction trades, which currently oppose, would probably be bought off if that change were made. But that is precisely one of the problems with these prior compromises, that they have not been productive.
Speaker: So it has gone through. it has gone through specifically both the Senate Housing Committee and the Senate Local Government Committee, both within a week of each other, the Housing Committee on the 22nd and the Local Government Committee on April 30th.
Speaker: By the skin of its teeth in both cases, the Senate Housing Committee, it required six eyes to win. And it doesn't matter if the no votes are actually someone not voting.
Speaker: If you vote no or if you decline to vote, it still needs six I votes. So in the end, there were six I's, two no's, and three no vote recorded. There were some disappointments there.
Speaker: The biggest one that has gotten the most press in the last couple of weeks is the state senator from Hayward, Aisha Wahab. She is currently the chair of housing, which has turned out to be a bit of a change because previously the chairs of housing were people like Scott Wiener, who were extremely pro-housing and used their committee as a vehicle to get stuff off to the races.
Speaker: Well, Aisha Wahab has been talking a lot on this subject, and she is effectively at this point a housing supply skeptic. She says things like, I don't feel like our strategy of build, build, build has worked.
Speaker: Well, it hasn't had much of a chance, okay? And it's not clear to me what she is putting in its place. She is talking about address demand, not just supply. Does that mean stop people moving to California? Does that mean other things that would probably be even less popular than building?
Speaker: In my opinion, it means avoiding tough choices. It is saying that because you don't think that market rate housing is perfect in every way, you want all the cities to be able to keep blocking it.
Speaker: To me, it's against progress, and it's very disappointing from someone who is known as a firebrand progressive. So with Wahab in opposition, that meant that broad support among Democrats was not assured.
Speaker: And usually, when a committee chair opposes, it is very difficult for the bill to get out of committee. One example of how that happens is that the committee staff writing up the analysis will essentially take the position of the chair.
Speaker: And indeed, even with the same staff, I understand, or the same kind of staff, the committee analysis on SB 79 was very s skeptical, very unfavorable, and it was, again, some of the same people who had written much more reasonable write-ups of previous bills when the chair was in support.
Speaker: But a committee is still governed by votes, and you can still vote something out of committee, even against the wishes of the chair. It doesn't happen very often, and so it has a term...
Speaker: That is a little aggressive. It's called rolling the chair, means getting it out over the chair's head. They voted. They kept the voting open for hours, which is fairly common. If you don't have all the senators in the room at the time, they usually let whoever's in the room vote, and then they wait for others to trickle in because they might be double or triple booked.
Speaker: And it did not seem clear that it had the votes, that it would get to the six. With Wahhab against, Republican Sayarto against, and many others not voting, it seemed like it might only hit four or five, which would again be more than the no's, but it would still not clear.
Speaker: I believe that one of the final senators to come in and vote yes was Senator Rosalesi Ochoa-Bogue, who is from the Inland Empire. Her district office is in Redlands, if that gives you any idea. We may have to thank the pro-housing movement in the Inland Empire for clearing this hurdle.
Speaker: And other than that, of course, Democrats from up and down the state voted for it. One Republican for, one Republican against. Only one Democrat voted no, Wahhab. And three Democrats, Cortese, Durazo, and Grayson, declined to vote.
Speaker: Cortese is from the South Bay, Durazo is from the Central Valley... I believe Bakersfield and Tim Grayson is from right in our neck of the woods, the East Bay, representing Contra Costa County, east of the hills, and some of the Alameda County cities like San Leandro and the unincorporated areas.
Speaker: And I have to say, ah knowing a little bit about Tim Grayson, I'm pretty surprised and disappointed. Same, I think, about Cortese, although I don't know quite as much about how he's panned out.
Speaker: But it passed. And then, unfortunately, we had the same situation, a very similar situation, in the Senate Local Government Committee. We had a hostile chair. The chair at this time was Durazo, who had voted against it in housing.
Speaker: Once again, there was a very nasty analysis. And once again, the chair was rolled. This time, the two Republicans were Sayarto and Choi, who both voted no. Four Democrats voted yes. Aragene, Cabaldon, Laird, and Wiener. And Durazo voted no, of course.
Speaker: Laird, in this case, is San Luis Obispo and was the last person to vote, so may have needed some cajoling. There are many more hurdles to get through. The biggest one this coming month is going to be Senate Appropriations.
Speaker: And that's even more difficult because if it is decided that it will not get out, then it is simply held without a vote. So no one has to go on the record. It just doesn't garner enough support.
Speaker: The chair of Senate Appropriations, I believe, is Caballero, who voted for it in committee, in the housing committee, which may be a good sign, but... Sometimes people vote for things saying, I want to see more work put on this. I want, you know, my favorite people to come come on board and I just want to give it more time. So voting for it is not a promise that you are always going to be supporting the bill as it goes through.
Speaker: And of course, it has to get off the floor. That was where Senate Bill 50 failed last time, is it did not get off the Senate floor. It could do a lot. If it passes the Senate, then it has to pass the Assembly. So in the Assembly, once again, you will have two or three committees, probably three, and then you'll have the Assembly floor.
Speaker: It takes a lot of work to do this. If you're interested, look up California YIMBY Lobby Day as an opportunity to go and do some of the convincing that legislators need.
Speaker: But it is not dead yet, and it has overcome some steep opposition. To give an idea of how infrequent it is to roll the chair, i read one article in, I believe, CalMatters that quoted someone saying they didn't see it happen more than once a year. Well, now it's happened twice in two weeks.
Speaker: So we are pretty determined on this. So now the bad news. Senate Bill 677 was the other one I talked to last week. That would have mostly made it a lot easier to build duplexes, and in some cases triplexes and fourplexes, in single-family zoned areas across the state.
Speaker: It would have removed the owner-occupancy requirement that makes it harder for professionals to buy a house, build on it, and then sell it. Note they would probably be selling to owner-occupants. But at the moment, SB9 requires the person who gets the permit to be an owner occupant.
Speaker: And it also made a whole lot of the rest easier to get through and to make the projects that we're going to sell on these kinds of lots. It also made SB 423 about automatic semi-automatic approvals for affordable housing in under-building cities would have made that bill work better. So that is also in that whole bill 677. That unfortunately worse.
Speaker: a lot worse That came to the same Senate Housing Committee on the same day, April 22nd. The ayes were four. The noes were three. The fail to votes were four.
Speaker: So what was different? Caballero did not vote. The same three did not vote. Cortese, Durazo, Grayson. The no's were Ochoa Bogue, who did the Republican, who did vote for 79, Sayarto, the Republican who did not vote for 79, and once again, Aisha Wahab, who, based on this, seems to believe that the ideal form of housing in most places is single-family housing, and the duplexes are some kind of capitalistic intrusion.
Speaker: I can't help but notice that this is an area where the coalition is not as strong. You don't get the Republicans on board, as few as they are, and the support from Democrats is weaker, limited to the more pro-housing wing of the Democrats, which is not perhaps a majority, certainly not in this committee. And I have to think that part of that is that it is affecting single-family zoned areas, which people get very emotional about.
Speaker: One of the things that once again disappointed me about the opposition to SB 677 was it was not just the usual suspects. By usual suspects, I mean the League of Cities.
Speaker: I mean the building trades. I mean a lot of social justice nonprofits that... have a bug up their ass on this in a very counterproductive way. But one that you do not always see on this side of things precisely, or you sometimes see them off on the sidelines, is the California Association of Realtors.
Speaker: For some reason, the realtors think that they don't want to mess with single family homes. I don't think they are acting in their own economic interests here. If there were more homes being built, there would be more opportunities for realtors. But I think that the California Association of Realtors is dominated by the ones who are sitting at the top of the scrap heap selling the two, three, four, or five million dollar homes.
Speaker: And they don't really care if younger, less experienced realtors are simply not getting work. So 677 is gone. I'm hoping that the reforms to 423, which will make larger scale mixed income housing more feasible across the state, especially in the Bay Area.
Speaker: i hope that finds another vehicle because as that was more technical and is probably an easier sell on its own. So some good news and bad news there. Now I'm going to bring up some bills that I did not talk about before and where, spoiler alert, the news is going to be good on both of them.
Speaker: And they are both relating to the California Environmental Quality Act. So a little background. The California Environmental Quality Act was passed in the early 70s, and it was meant as a disclosure bill.
Speaker: It was a rule that when the government did something that might affect the environment, it needed to study and report on it. It has a national counterpart, the National Environmental Protection Act, or NEPA, and it was basically made as a state copy of that. But where it really branched out was that A few years after it was passed, a question came when you say the government is making a decision that might affect the environment.
Speaker: Does that decision include approving housing? The California court system said yes. And the legislature, although it was not the legislature's decision, the legislature said that sounds good. And they passed more legislation to codify that.
Speaker: And over the years, CEQA has become a cottage industry for lots of lawyers, lots of consultants, and lots of unions that try to wield veto power over individual projects, as well as NIMBYs, of course.
Speaker: Because basically it requires, in many cases, it requires voluminous research on many topics. And if detractors of the project think that your report was not complete enough, they can sue you.
Speaker: And the law is on their side. In fact, sometimes they can get back their costs. their legal costs. CEQA very often ties up projects. It delays and therefore denies housing.
Speaker: It does so even in the cases where you are building inside a city and therefore it is not really infecting the environment. There are some possible things that can happen, you know, wetlands, water sources, hazardous materials in the soil.
Speaker: But CEQA is a very big tool. And it's not just how many projects are actively opposed using a CEQA lawsuit. It's once again, the time and expense of preparing these reports for especially smaller projects is definitely going to weigh down your project.
Speaker: And what you really can't measure is how many projects are never proposed because of CEQA. Projects that would be viable if there were a more straightforward way to examine the environmental impact or more deference for infill projects.
Speaker: But because they knew they could expect fierce opposition, they simply never proposed. And what it boils down to is that the mechanism of CEQA, I think a reasonable characterization is that it assumes that the best environmental moment for California was 1970, year it was passed,
Speaker: and that anything that changes the built environment since what it was like in 1970 is of necessity suspect and has to be examined and picked over and sued to make sure that it's good.
Speaker: And because it doesn't really substantially limit building new highways, you might also say that it considers the only bad thing about 1970 California's built environment was it didn't have enough highways.
Speaker: It is possible to say, hey, we looked at this and this does not really have an environmental impact, or if it does, it's easy to mitigate. And in those cases, you do what's called a negative declaration or ND instead of an environmental impact report.
Speaker: or you do a mitigated negative declaration or MND. So that is still a small report, but it is not the major, major report that is the yeah EIR. So what are the bills that I'm talking about today?
Speaker: So one of them comes from the assembly, comes from our friend Buffy Wicks, And that is Assembly Bill 609. That is really remarkably sweeping and simple.
Speaker: It basically says CEQA no longer applies to a housing development project in a city or an urban area as long as it has been previously developed with an urban use or at least 75% of its perimeter either now has an urban use or has in the past had an urban use.
Speaker: It does make the many exceptions that I've talked about with prior bills, this laundry list that's been worked out of things we do not want to, or places we do not want to goose building in, fire zones, flood zones, wetlands, sensitive habitats, places with tribal cultural resources, and so forth. Some coastal zones, although that exception has been pared back a bit.
Speaker: hazardous waste sites, that sort of thing. So that is still an exception. There is a requirement that if you're in a city and you find some kind of environmental condition, which you have to look for possible environmental issues, and if a possible environmental issue is release of a hazardous substance, then you are still required to mitigate that.
Speaker: So an example would be there's a lot of heavy metals in the soil because there used to be a factory there or maybe an electroplating shop. You can do something to prevent that from creating health impacts on the people who would live there, which might be so as simple as paving over the whole site, if that's allowed.
Speaker: It's not that this allows literally anything. It does still say that the project has to be consistent with general plan and zoning, or more specifically, as long as it's consistent with one of the two, then it's consistent.
Speaker: It also has to be at least one half of what are called mullin densities, which in our metro areas are basically 30 units an acre, so that means they have to be at least 15 units per acre.
Speaker: So 609 is fairly ambitious, and the committee analysis, the first committee in this case was the Assembly Natural Resources Committee, was somewhat skeptical. these are Interestingly, this was an analysis that did not seem to track the chair because the chair of the committee did end up voting for it.
Speaker: But it apparently i did not hear much concern about it. It seemed to make its way through the Assembly Natural Resources Committee pretty easily. with 12 votes in favor, 0 no votes, and 2 not voting.
Speaker: So pretty much everyone and no one was speaking out against it. Then it went to Assembly Housing and Community Development, and that passed with 11 aye votes, 0 no votes, and 1 not voting. So that is on its way to Assembly Appropriations.
Speaker: However, if that ends up bogging down because it is, on its face, so ambitious and such a change, There is another CEQA bill by Scott Wiener, SB607, that is more technical, but could be more revolutionary in some ways.
Speaker: So that is about how CEQA is interpreted. And it also gives more exemptions for infill projects. CEQA has grown over the years partly by interaction with the court system, because the court system has been asked to say, is this environmental impact report sufficient for the purposes of the law?
Speaker: And on the whole, that has made these reports more sprawling and have to be as complete as possible to meet every possible objection. The current legislation says that they have to prepare an environmental impact report if there is substantial evidence in light of the whole record before the lead agency that the project may have a significant effect on the environment. And what the Supreme Court, the state Supreme Court, said in interpreting this was it didn't mean that it had to be a certain amount of likelihood, that there had to be a fair argument that this effect could exist.
Speaker: That didn't mean you could just speculate, but it did mean that if there were different reasonable ways of looking at the evidence, then there if they found there was one fair argument that something had to be considered or covered for environmental reasons, then then the agency was obliged to work on that basis and sit and prepare an EIR.
Speaker: And if you have an yeah EIR, that doesn't mean you just look at that issue that was identified. It means you look at every issue. SB 607 changes the whole standard of consideration. The new legislative text would be,
Speaker: if the lead agency determines based upon substantial evidence in light of the whole record before the lead agency, that it is more likely than not that the project will have a significant effect on the environment, an environmental impact report shall be prepared. So it's basically saying it's not these possibilities. It's not these possibly bad arguments that are still deemed fair.
Speaker: It's that if the agency determines that it will probably have an effect, then that is what an EIR is for. It also changes the standard for how you do a negative declaration that I talked about before.
Speaker: Before a negative declaration, you had to actually say there is no evidence of any possible effect. Under the new amended legislation, ah negative declaration would be that they determine, based on the whole record and the evidence, that the project will not have a significant effect on the environment.
Speaker: So they simply have to determine, again, based on the evidence, that it's not impactful rather than find that there is no possible way that it could be impactful.
Speaker: Although this seems like a pretty pettifogging distinction, i think everyone agrees that it would lead to a lot more things not qualifying for an EIR and therefore the CEQA being less of a burden for a lot of projects.
Speaker: Now, they do make sure not to loosen CEQA for disfavored projects. And what they defined as projects that they did not want to make easier were oil and gas infrastructure, which makes sense, and distribution centers, by which they mean like the Amazon warehouses that a lot of communities are concerned about.
Speaker: because those generate so much traffic and trucks and so forth. ah Nothing else. Not other polluting industry. i wouldn't mind if that got added in, ah but there we have it.
Speaker: um That is one of the changes in 607. Another big one is that it changes the infill exemption. Right now, the infill exemption exists. you know You can say, this thing that we want to do is infill housing, and therefore it should be considered exempt from CEQA, Well, there is currently something in there that says, except under unusual circumstances.
Speaker: And that has been the camel's nose to allow a lot of lawsuits saying, well, our unusual circumstance is gentrification and just everything under the sun. So it would eliminate that part about unusual circumstances.
Speaker: And it would require a much more comprehensive standard set of standards to be made up at the state level for what does count toward the infill exemptions. So it would be a lot easier to tell in advance if something was in fill.
Speaker: It has an interesting new concept called the near miss. So what that means is that if you do your initial environmental assessment to figure out what kind of report to do, and it says that you would have been exempt from yeah EIR r except for one condition, then you can write an EIR r that is a lot more abbreviated and is just about that one condition. I could imagine being...
Speaker: a little more comprehensive. Like if you find that issues a B, and C are impacted, then you should write an EIR about just issues A, B, and C, but that's not how they did it. Another important one is that it deems rezoning's compliant because right now cities make their housing elements and then they have to separately rezone sites for the housing they planned in that housing element.
Speaker: And what this says is that when you do rezoning, that is consistent with a housing element, not necessarily exactly the same as a housing element, but consistent with a housing element on sites that were designated in the housing and element for low-income housing, that too is definitionally exempt.
Speaker: Everything that I mentioned exempts distribution centers and oil and gas infrastructure. Once again, those continue to have the same high standards, even if they're infill. I should hope if they're infill. It does something about the record because there's a phase in SQL of preparing the record and it cuts out some things.
Speaker: I believe some sort of um staff emails. Right now you have to create such a huge record about everything that might possibly be considered or relevant. That it usually takes several months to a year to just do that phase of the work.
Speaker: So this tinkers with that as well. And interestingly, this has the same set, I think, of opponents that a lot of the others do, the environmental justice groups, the building trades and so forth. SB 607 of course, going through the Senate committees, not the Assembly committees.
Speaker: It passed the Environmental Quality Committee with ah negative ah with a with, yeah, fairly negative analysis. Six eyes, zero no's, two not voting.
Speaker: And Catherine Blakespear, the chair of that committee, voted for it. The two that voted against it were Rurtado and Perez. And then, once again, April 30th, it went to the Senate Local Government Committee.
Speaker: Five yes, one no, and one not voting. The no was Durazo, so I guess technically the chair was rolled here, but I want to point out that two of the yes votes here were Choi and Sayarto.
Speaker: which are the two Republican votes on that committee. So the yeses were the pro-housings among the Democrats, Argin, Cobbledone, and Wiener, plus the Republicans make five, and you needed four you needed four to get out of that committee.
Speaker: The one who didn't vote was Laird, San Luis Obispo, which is interesting because he himself was the pivotal vote who got Senate Bill 79 out of committee. So these are moving forward. And what I'm noticing is that if Buffy Wicks' AB 609, which is a really big exemption, past fails, you know, grinds to a halt because it seems so ambitious.
Speaker: I could easily imagine 607, which is more technical, passing and making at least as much change in how much housing can be built in California. And this is often a pattern that we have seen, is that when you have a very big bill that would accomplish a lot, and then that does not succeed, a lot of people put all their energy into that bill, a lot of the opponents, and a lot of other good things can pass under the radar.
Speaker: Don't know that SB607 is an under-the-radar thing. I feel like it is. Inflaming some of the same people who talk about CEQA on the same basis as 609.
Speaker: There is now a coalition called CEQA Works, which is very tendentious, um is basically representing all the established interests that CEQA benefits, in my opinion.
Speaker: And so, of course, they are fighting tooth and nail any even reasonable reform to CEQA. There is another philosophy behind 609 and 607 both, which is that you can't just consider what is bad for the environment.
Speaker: You have to consider what is good for the environment. All the evidence suggests... that people living in infill areas using more public transit, sharing walls, sharing heating, that is, ah it's a lot more efficient to heat 100 unit apartment building than 100 detached houses, or to air condition it for that matter, that it is environmentally beneficial to encourage housing in cities at the expense of housing in new green-filled areas outside of cities.
Speaker: like currently in the Central Valley. And so we really should be looking at CEQA from the perspective of not how do we stop these bad things from happening, but how do we move our built environment from the condition of 1970 to a condition that will be sustainable going forward?
Speaker: So I hope that ah both of these bills go through. and There are a number of other bills in the legislature this year that could do a lot. Some of them have also halted, but we continue the work.
Speaker: Thanks for listening. I will keep you updated on what happens this year and what happens with some other bills. And until next time, keep on learning.
