The real costs of subsidized housing

Santa Barbara News Press - 9/8/04

County planning commissioners today may approve a subsidized housing proposal, even though there's little or no real evidence that the program in question has worked well elsewhere.

The adverse consequences that a new "inclusionary housing" ordinance will have on neighborhoods and overall home prices is getting the short-shrift.

Have these ordinances worked well in the majority of the cities that have them? What are the experiences that Rancho Palos Verdes or San Juan Capistrano or other communities similar to ours have had with these programs? Has the more limited local program really worked during the past 10 years? A local attorney writing in our Sunday Voices section lists reasons why it hasn't.

Inclusionary housing laws benefit a few people while increasing costs for the rest of the community. The laws require builders to sell a certain number of units in their residential projects at below-market prices, or pay fees in lieu of constructing the units.

Two professors at San Jose State University have documented the impact that this "hidden tax" on home construction has on overall housing prices. They note that such rules in fact depress housing construction.

It's disappointing that some on the Planning Commission want to turn the discussion on the proposed ordinance changes into a debate about conflicting studies. There is a rebuttal study to the work of the San Jose State research on Bay Area jurisdictions with inclusionary zoning. But this rebuttal doesn't address the second study by the professors on Southern California communities.

Forget the duel. Instead, county officials should just show Santa Barbarans where these ordinances really have worked well.

We are pleased that the California Department of Housing and Community Development, in a July 1 letter to county Planning Director Val Alexeeff, has ordered the county to provide a rationale as to why it is changing and increasing inclusionary requirements. The state also wants "an analysis of potential impacts this increase might have on overall cost and supply of new housing" in our community.

Under the warm-and-fuzzy name of inclusionary housing -- subsidized housing is more apt -- the county may sacrifice our neighborhoods and open spaces in the dash to build more and denser developments.

Pushing it is an alliance of developers (who, after all, want to build and will put up with more rules if that's what it takes to get projects going in the county), politicians (who can brag they've "done something" about housing while ignoring the long-term negative impacts outlasting their retirements from office) and bureaucrats (whose job security and domain will grow as these programs and the enforcement of them take hold).

It will be hard for good sense to win out with this coalition pushing the new ordinance. If the county wants to give away housing, in addition to building new homes on its own land, why not buy existing homes to place in its subsidized program?

Under the warm-and-fuzzy name of inclusionary housing -- subsidized housing is more apt -- the county may sacrifice our neighborhoods and open spaces in the dash to build more and denser developments.