An audit of the City of Los Angeles’ affordably-priced housing program and density bonus program finds that they have been relatively ineffectual. Los Angeles City Controller Ron Galperin completed the audit to determine how well the “density bonus” program was performing since its inception in 2008. The audit found that 21 percent of new multi-family projects of five units or more, built between 2008 and 2014 (169 of 790 projects) utilized some aspect of the density bonus program -- resulting in 4,463 units designated as affordable. However, just 329 of these units were created in market-rate projects throughout the city. Galperin calls this “an arguably minimal impact when considering the city’s overall affordable housing needs.” The rest of the units were in entirely affordable housing projects.

The audit recommends that the city create additional incentives, such as additional density or permitting micro units; streamline processes through modifications to the current process of site plan review and expedited processing of environmental impact reports; conduct a legal analysis of what opportunities might exist, within the density bonus program, to allow market-rate developers to create income-restricted units off-site -- or to pay equivalent values into a fund which would build income-restricted units throughout Los Angeles; Review how income levels are defined. The audit also examined oversight and monitoring of the city’s overall stock on 28,482 income-restricted units. While auditors found reasonably adequate monitoring by the city’s contractor, and a 93 percent compliance rate, better oversight tools are needed to deal with conditions of some owners collecting more rent than allowed and some tenants exceeding income guidelines.

San Diego Seeks to Increase Urban Forest
The San Diego City Council unanimously approved a five-year urban forestry plan that would significantly increase the city’s stock of street trees, especially those in low-income and urban areas. The city’s Climate Action Plan calls for increasing percentage of San Diego covered in trees from 13 to 35 percent over the next 20 years. Those in favor of the plan say it will boost property values, improve air and water quality, enhance wildlife habitat, and shrink energy costs by reducing the heat island effect. The city is using a $750,000 grant from the California Department of Forestry and Fire Prevention to plant 500 trees in urban areas. The next step for the city is creating an updated tree inventory of the existing urban forest to create a better strategy.

Federal Funding Rule Puts High Speed Rail in Bind
The Federal Railroad Administration, under the Obama administration, modified the $928-million grant deadline for the California bullet train from 2018 to 2022. A recent risk analysis shows the California High Speed Rail Authority may need until 2024. The modification requires the state to pay its matching share of the stimulus grant, estimated at $2 billion, before drawing on the grant. This means the state must start funding construction out of state funds instead of relying on federal grants. California can draw on carbon tax fees, which are projected to generate about $500 million annually but have been below projections. It is still unclear what direction Transportation secretary Elaine Chao will do under President Trump.

Central Valley Reaps Economic Rewards of Climate Change Policies
A report from Next 10, a public policy think tank, shows that California’s global warming policies have had economic benefits for the San Joaquin Valley. The valley has historically struggled with poor air quality and an economy that’s slower than the rest of the state. “The report, The Economic Impacts of California’s Major Climate Programs on the San Joaquin Valley” analyzed the cap-and-trade program, renewable energy standards, and energy efficiency initiatives, including those initiated under 2006’s AB 36. According to the study there has been $13.4 billion in economic benefits, primarily from the construction of solar generation facilities. The report warned that uncertainty regarding the cap-and-trade program had to be removed and auction proceeds spend on valley programs that cut GHG emissions. It also recommends that energy efficient incentives have to be expanded in the valley where greater energy savings are found compared to more temperate parts of the state.

League of Cities Considers Draft Housing Assessment
The League of California cities recently weighed in on the Draft 2025 Housing Assessment “California’s Housing Future: Challenges and Opportunities.” The draft discusses the serious need for more affordable housing, the full range of required housing, as well as an analysis of the economic impact of where housing is located. However, according to the League, the report places a disproportionate focus on the role of local governments and not private market forces. Additionally it fails to mention the loss of over $1 billion annually in affordable housing resources after the dissolving of redevelopment agencies. Concerns are also raised with several apparent conclusions presented in the report on the role of local government in the development of housing which lack sufficient supporting research and evidence. Finally, the League is wary of some language that alludes to a top-down approach to the statewide housing crisis.

Suits Claim Cap-and-Trade Imposes Illegal Tax
In two separate ongoing lawsuits, last week the California Chamber of Commerce and a tomato packing company argued in front of a the 3rd District Court of Appeal to invalidate California’s cap-and-trade program. Plaintiffs claim that cap-and-trade fees constitute a tax, rather than a fee. A tax would be impermissible under Proposition 13 without public approval. While the legislation, AB 32, did allow an auction it amounts to a tax increase that would require approval of two-thirds of the Assembly and Senate. The cap-and-trade system is not under question, only the state’s selling of pollution permits. The Air Resources Board considers the auction similar to regulatory fees, and therefore not required the two-thirds majority. The judges have until late April to make a decision, however lawyers form both sides said they would appeal to the California Supreme Court if they lose.

‘Rouge’ Bike Share Company Walks Back Plans in S.F.
Bluegogo, a Chinese-backed bike-sharing startup, has abandoned plans to deposit hundreds of bikes on San Francisco streets without city permits, approval, or letting anyone know its plans. Rather than use permitted bike stations, Bluegogo would have parked bikes haphazardly around the city. The program was scheduled to launch this week. Instead, it intends to operate as a conventional bike share service, with dedicated stations. The San Francisco Bike Coalition says the original plan would have left “thousands of uninspected and unpermitted bicycles to be stored unattended for long periods of time on sidewalks, in parks and on our streets.” A Bluegogo official told the Mercury News, “We didn’t want to be that startup that literally shows up to the city first and then deals with all the problems later.”

Contest Envisisions 'Resilient' Bay Area
The Bay Area: Resilient by Design Challenge invites designers, policymakers and developers to imagine climate change solutions for the San Francisco area. The contest is being funded with a $4.6 million grant from the Rockefeller Foundation and is modeled after a similar New York-area contest in 2013. The challenge will be divided into two phases: in the first, teams will participate in a three-month “exploratory research and community engagement period to develop initial design concepts for specific sites” and the second phase will be a, “collaborative five-month intensive design phase” working with residents, businesses, organizations and local politicians. (See prior CP&DR coverage.)

Quick Hits & Updates
Sacramento officials are asking the 350 largest property owners adjacent to a downtown streetcar line to contribute $2 million a year in taxes. The Sacramento Streetcar Community Facilities District would include all commercial property owners that have parcels larger than 12,600 square feet. The tax district would help pay the project’s operations costs once it’s built. This is the second attempt in three years to win a downtown vote that city officials say is needed to pull together the final pieces of the 4-mile streetcar. The tax will be voted on in May.

The Costa Mesa City Council voted, 4-0, to drop a 2014 lawsuit against the Civic Center Barrio Housing Corporation. The city lent the affordable housing nonprofit money to purchase and develop three properties. In 2015 the city issued a credit bid of more than $2.38 million and took possession of 22 apartment units within the complexes. The city took over the property to preserve affordable housing for low-income families after the units fell into foreclosure.

The Oakland Raiders officially submitted a relocation application and are taking the first step towards moving to Las Vegas. The Raiders must get approval from three-quarters of the league’s 32 owners to move, which will likely take place at the annual NFL meeting in late March. However, Oakland Mayor Libby Schaaf is still fighting to keep the team with a new $1.25-billion stadium proposal.

The City of Anaheim is hitting short-term rental owners operating illegally with fines and shutting down utilities for the units. The new rules include limiting the number of guests, quiet hours, and requiring owners to respond to complaints within 45 minutes. In the last four months the city has collected $8,000 in fines.

The U.S. Fish and Wildlife Service has proposed the removal of the Hidden Lake bluecurls, an alpine wildflower found in the San Jacinto Mountains, from the Federal List of Endangered and Threatened Plants. The flower was added to the list in 1998 to save protect it from hikers and equestrians. Biologists are worried about climate change threatening the flower since it only grows in a specific area under specific conditions.

EDF Renewable Energy signed a deal with Marin Clean Energy to purchase electricity from its 150-megawatt Desert Harvest solar project. Although construction has not begun, the 1,200 acres of federal land south of Joshua Tree National Park will be located in one of the nation’s clean energy hot spots. While there were originally objections from NRDC and Defenders of Wildlife because of potential disruptions to critical habitat for the desert tortoise, EDF has agreed to buy private land near the project and set it aside as protected habitat.

Airbnb released a report indicating that hosts in Los Angeles have generated more than $13 million in tax revenue for the city since this summer, and a “vast majority” of the funds are going towards homeless assistance. In fact, only around $5 million is going to homeless support, with the rest going to the city’s general fund. Under a new agreement, hosts from Airbnb are paying the same 14 percent tax that hotels pay.

San Francisco Mayor Ed Lee and city planners have issued a redesign proposal called the Civic Center Public Space Design to make the plaza around City Hall more inspiring, sustainable, and inclusive. The planning department has had initial meetings with candidates, and final proposals are due Feb. 10. The winner will receive a contract of up to $600,000 to draft a full proposal.

The Elk Grove City Council postponed action on deciding whether the proposed $400 million Indian casino will lead to a referendum or go along with petitioners’ demands. The casino would be built adjacent to an unfinished mall, and the mall developer says the casino would drive traffic to the mall. However, petitioners collected enough signatures to overturn the council’s earlier decision to pave the way for the casino. The council will take up the matter again in two weeks.

Developer Wessman Holdings is suing the City of Palm Springs for denying his 42.2-acre luxury home development. The project, Crescendo, was initially approved by City Council nine years ago. After the recession and legal challenges from Advocated for Better Community Development, the developer asked for a time-extension that was not granted. Wessman paid 150 percent of required fees for priority processing but received no such preferences.