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CP&DR News Briefs July 23, 2019: Multifamily Shortage; Impact of Federal Tax Cuts; S.F. Zero Emissions Plan; and More

Brett Simpson on
Jul 21, 2019
Report Calls for More Multifamily Development 
California needs to build more apartments to close its housing gap, according to a new report from the UC Berkeley Terner Center for Housing Innovation. The report, “Is California’s housing market broken?” uses new local land use data from the Terner Center California Residential Land Use Survey. The data showed that most California cities are building very few multifamily dwellings. The report also found that, economically speaking, local housing markets are working in the opposite direction than expected: high-rent communities build fewer, rather than more, new apartments. This is because statewide, cities use zoning and community approval processes to deter development of new multifamily buildings. The data showed that cities with “anti-apartment zoning" have been successful: cities that set lower allowable densities and building heights build fewer apartments. Additionally, the report showed that the ad hoc, discretionary local permitting process makes new building longer, riskier, and more expensive. The authors suggest stronger policy to financially incentivize new building, not merely on-paper zoning revisions. “California’s governor and states legislature will need strong spines to face down recalcitrant homeowners,” the authors conclude. 

Federal Tax Cuts Take Toll on Statewide Housing Development 
According to an analysis by the Sacramento Bee, corporate tax cuts delayed or killed 15,000 affordable housing projects in California since their 2017 passage. The data showed that this corporate tax rate reduction – from 35 to 21 percent – had the unintended consequence of diminishing the potential benefits of the federal low-income housing tax credit. The analysis showed that companies were willing to invest about 10 to 15 percent less than they had before the 2016 election. According to Matt Schwartz, president and CEO of the California Housing Partnership, this has meant a 23 percent decrease in affordable housing production: from about 24,000 units in 2016 to less than 19,000 in 2018. It has also delayed or ended 10,000 proposed housing units in 2017 and 5,500 in 2018. This amounts to about a $1.4 billion decrease in affordable housing statewide between 2016 and 2017, and a $400 million less in 2018 than in 2016. "That has really painful effects, even if it doesn’t sound that big,” Schwartz said. “For the folks on the waiting list for this housing, it makes a huge difference. These are people in fragile conditions, living paycheck to paycheck or some of them even homeless.”

San Francisco Strives for Zero Emissions by 2040
The City and County of San Francisco released its “Electric Vehicle Roadmap” with the goal of reaching zero-emissions transportation by 2040. Measures proposed include providing incentives for zero-emission vehicles, developing greater charging infrastructure, focusing on grid integration of renewable energy and EV charging capacity, raising public awareness of electric mobility; and advocating for emission-free technology in future mobility projects. The roadmap sets incremental targets to reach this goal: including requiring all commercial parking lots and garages with more than 100 spaces to build EV charging stations for at least 10 percent of the stations by 2023. The city is also including a lower rate in their proposed TNC Traffic Congestion Tax for electric vehicles, are transitioning Muni cars to electric power. “Of course we’d like to see walking, biking, and public transit prioritized,” said Mayor London Breed in the Roadmap announcement. “But if San Franciscans are going to drive, we hope they go electric.” 

Groups Sue to Protect Mountain Lion Habitat 
Seeking greater protections for Southern Californian mountain lions, the Center for Biological Diversity and Mountain Lion Foundation formally petitioned the California Fish and Game Commission to protect the species under the California Endangered Species Act. The petition follows a March 2019 study finding that the species could face extinction in little over a decade, due to inbreeding caused from isolated territories disconnected by private properties and highways. Should mountain lions gain protected status, state and local agencies will have to take measures to manage threats – such as creating wildlife corridors under freeways. The Department of Fish and Wildlife has three months to make an initial recommendation to the Fish and Game Commission, which will then vote on the petition at a public hearing later this year.

Quick Hits & Updates 
After months of protests against a temporary 200-bed homeless shelter approved by the San Francisco Port Commission, a coalition of local residents filed a CEQA lawsuit to block construction of the shelter. The coalition, Safe Embarcadero for All, argued that the city didn’t gain approval from the State Lands Commission, which has oversight over waterfront development, and that it didn’t go through the full environmental review process. The $37,000 navigation center, planned to replace a parking lot near the Ferry Building, is a crucial part of Mayor London Breed’s homelessness production goals.

Newport Beach residents may not develop on public beaches, according to a ruling from the California Coastal Commission. The city attempted to amend its Local Coastal Program to allow for homeowners to pay a fee for up to 15 feet of encroachments on Peninsula Point. Many such encroachments, including landscaping and other property, have been in place for years and extend as far as 80 feet onto public beaches. However, the commission struck down even the attempted compromise, in favor of public access for all and removal of all current encroachments.

As part of its plans for mega-expansion throughout the Bay Area, Google entered into a $15 billion agreement with real estate developer LendLease to transform downtown San Jose, Sunnyvale, and Mountain View. Major mixed-use projects in each of these cities will help Google realize its $1 billion commitment to build up to 20,000 homes in the Bay Area. Notably, Google has already proposed a transit-oriented community near Diridon Station in San Jose.

Stockton City Hall will likely be transformed into market-rate housing and retail, after the city council voted unanimously to grant exclusive negotiating rights for the building to developer Cort Companies. The developer’s plans will preserve the facade of the 93-year-old historic building, but add 35 housing units and retail space to its interior. Plans for three adjacent buildings include an 80-unit family residence and and community center.

Los Angeles’s Hollyhock House, designed by Frank Lloyd Wright, was designated a UNESCO World Heritage Site – the first such honor for the city. The house joins 1,121 World Heritage Sites around the world – 869 of which are awarded cultural status. It is one of eight Wright-designed buildings to share the designation, joining sites such as New York City’s Guggenheim Museum and Fallingwater in Pennsylvania. Los Angeles completed a four-year, $4.3 million restoration to the grounds and the home in 2015.

Riverside County Transportation Commission is considering a ballot measure to double a half-cent sales tax increase to finance freeway widening and other big transportation projects. Officials claim that doubling the existing 1989 half-cent Measure A would generate $3 billion to $6 billion over 30 years – giving the area funds to build greater transportation improvements faster. A final decision to put the item on the 2020 ballot would come next year.

The San Bernardino County Transportation Authority has broken ground on its Redlands Passenger Rail Project, which will add a nine-mile rail connection between the University of Redlands and the San Bernandino Transit Center. The project will house the Arrow commuter line, which will add low-emission passenger trains for conversion to zero-emission – the first-ever zero emission train vehicles in North America.

Toll roads are likely coming the Riverside County highways during the 2020s, according the the Riverside County Transportation Commission. The commission is launching a $1.4 million engineering study to examine the feasibility of extending Corona’s 91 Freeway toll lanes to downtown Riverside, and adding toll lanes on the 60 and 215 freeways in Jurupa Valley, Riverside and Moreno Valley. Funds from toll lanes will go to transportation infrastructure projects.

San Francisco Supervisors killed Mayor London Breed’s proposed charter amendment to streamline affordable and teacher housing projects. Breed’s proposal would have saved such projects millions of dollars, and between six and 18 months per project. To get the amendment on the November ballot, Breed would have needed majority supervisor support – which she failed to obtain.

All 11 Kern County municipalities failed to meet their state affordable housing production goals, and four failed to submit an annual housing development progress report at all, according to a recent report from the California Department of Housing and Community Development (HCD). According to the 2017 SB 35 law, cities that fail to report their annual progress update are required to adopt a streamlined permitting system for new housing.

The Highland Greenspot Village & Marketplace project will finally move forward more than a decade since its inception, after the Highland City Council certified a new environmental report allowing the city to buy the land from the county. The initial plans at the "“Golden Triangle" off of Greenspot Road envisioned a bustling center with 800 residential units and about 75 acres of mixed-use and commercial space, as well as the city’s first movie theater. The U.S. Fish and Wildlife Service has designated the entire site critical habitat for the endangered San Bernardino kangaroo rat – and any development plans will need to address their protection.

The Federal Transportation Administration awarded $100 million to L.A. Metro’s Purple Line subway extension to Westwood. The grant will fund construction of the third segment of the line connecting Century City with Westwood, a 2.6-mile stretch that will include two new stations. L.A. Metro has requested a total of $1.3 billion in funds from the FTA, and the total extension project is projected to cost $3.6 billion.

The 51,000-acre N3 Cattle Company ranch in the East Bay is for sale for $72 million – the largest current land offering in the state. The ranch’s principle owners, who have held the land for 85 years, claim that they aren’t interested in a piecemeal sale – and hope to sell to conservationist groups. The massive property spans four counties: Alameda, San Jose, San Joaquin, and Stanislaus.