Zev Yaroslavsky: Why SB 50 is Not Right for LA

Conan Nolan: The UCLA Quality of Life Index, released this past week, indicates that over half of LA County residents have considered—or know someone within their family—leaving the state of California as a result of the cost of living. Zev Yaroslavsky, the cost of living and rent is a big problem. Has it gotten worse? 

Zev Yaroslavsky: It has gotten worse every year. The cost of living is the category that people are least satisfied with in Los Angeles County. The single biggest factor in the cost of living is the cost of housing. The cost of housing is a far greater concern than taxes or gasoline prices.

The costs of housing look like they are plateauing a bit. The rate of decline has slowed, so I hope it declines. There is a lot of construction of housing going on in this city. Most of the construction is market-rate, so it is not going to address the affordability crisis directly.

There has been a lot of state and local legislation to encourage more residential development. These bills are beginning to have an impact. 

Conan Nolan: Senate Bill 50 is a bill that would allow for significantly increased developments, such as Culver City’s Ivy Station, to be built near transit stations. This would allow four, five, six story apartment buildings. The argument of the State Senator behind this bill, Scott Wiener, is that California need something drastic because we need 3 million units and we want them near transit.

Zev Yaroslavsky: First of all, the city of Los Angeles—where I governed for 40 years and where I come from—has transit-oriented development proposals and mechanisms that they are implementing as we speak. The Exposition Light Rail has a Specific Plan that encourages more development near stations.

The problem is when we talk about transit-oriented development is that when people think of mass transit, they think of the subway and light rail lines. This bill extends to basically every bus line in the LA basin. So it is not just the Red Line station at Universal City, it is the bus stop at Melrose Ave and Gardner St. That intersection is a very middle-class area with no big job magnet around it. Any single-family home within a quarter-mile of a bus stop would be rezoned for multifamily. SB 50, Senator Wiener’s bill, is an overreach. I think most people understand that.

Los Angeles has exceeded its state imposed housing goals for the past several years. Just last year, the city of Los Angeles approved 27,000 new apartment units. That is the single biggest number of approved units since 1981. So the current bills are working.

Conan Nolan: Now, what about the cities that have not fulfilled their housing construction goals? For example, you’ve got the state suing Huntington Beach currently.

Zev Yaroslavsky: I am not here to discuss Huntington Beach. I am from Los Angeles, and the problem with the Wiener bill is that it treats every city the same. 

If you want to create affordable housing, don’t exempt the affluent cities. He has made value judgments and political judgments.

There has to be a more intelligent way to do this. Not with a meat axe, but with a scalpel. I’m hopeful that the Legislature will come to its senses. If not, on their watch, they can say they’ve destroyed cities and communities up and down the state of California.

We don’t need to do that. It’s an overreach. There’s a middle ground that he is not interested in exploring, because he is carrying the water for an industry that serves to benefit.

Conan Nolan: Can we at least agree that the housing crisis needs to be addressed? There is a generational issue where young people cannot afford property here.

Zev Yaroslavsky: Absolutely. Young people, people of middle and low incomes, and renters. Those are who we call in our recent study, “the struggling group.” This is the 35% of Angelenos who are struggling economically. Those are the people who are on the bubble, and those are the people we ought to be focused on.

We don’t need to be focused on the folks coming into the state to take high-paying tech jobs paying them $150,000 or $200,000 per year. They can pay for the market rate housing. It is the people who are leaving town that need our focus.

In Los Angeles, we have a centers concept. Over the past 50 years, our city has developed around these centers of life and jobs: Centruy City, Westwood, Downtown, Hollywood, Universal City, and there are others. 

We also need to have non-centers, and balance between high-density, medium-density, and single-family home density neighborhoods. You don’t, with one broad brush, destroy all of that. It’s suicide from a land use point of view.

One example: Angeleno Heights, the first historic preservation zone in Los Angeles with the highest concentration of 19th century Victorian homes. No one in their right mind would want to raze that. It is less than a quarter-mile from Sunset Blvd. Sunset, according to state law, is a high-frequency bus corridor and under SB 50, that whole neighborhood would likely face destruction to make room for expensive, market-rate apartment buildings. There are plenty of other HPOZs that would be similarly affected.

It’s just wrong. The committee that approved SB 50 did so last week without even having the text of the bill in front of them. Not one member, aside from Scott Wiener, really knew what was in the bill. There is a lot wrong with the process and the substance of SB 50. 

Editor's note: After NBC4's interview aired, TPR posed the following question:

TPR: Zev, what would you propose to address the affordability crisis?

Zev Yaroslavsky: I can only speak for our region. More than half a century ago, Los Angeles articulated a long-term land use objective called the “centers concept.” The idea was to develop centers with high density commercial and residential construction, as well as medium and lower density areas. If you have centers you need to have non-centers. Not every neighborhood in the city should be a center. As UCLA Urban Planning Professor Michael Storper has said, we should develop in density clusters, not density corridors. We need zoning and planning; one without the other will create irreversible adverse consequences. 

In that context, when we increase zoning to allow for high density residential development in our city, we ought to do it around those centers, around areas planned for medium density, and around fixed rail stations. But here’s the rub: when we upzone a property we are increasing its value with a stroke of the pen. The landowner hasn’t earned that increased value; he or she happens to have been at the right place at the right time. My single family home will increase in value under SB 50. If I choose to develop it as a 7 story apartment building, the city has a right to demand that I set aside a meaningful percentage---say 50%---of the new units for low and moderate income tenants. The allowable density will rise exponentially, so in exchange it is not unreasonable to require that society get something in return for this newly created wealth. Developers will make money, low and middle income persons will get housing, and neighborhoods will truly become more diversified. Setting aside 10 or 15 percent is an insult; worse yet, being able to buy one’s way out of this responsibility by paying an in-lieu fee, is doubly insulting.

If we want to use zoning to generate more affordable housing, this concept of inclusionary zoning and value capture is the way to do it. If we fall short of the mark, this whole concept is a sham and a gift to landowners throughout urban California. We have unutilized zoning capacity in Los Angeles—hundreds of thousands of units' worth—and there are rational ways to increase residential zoning without taking a sledgehammer to almost every neighborhood in the basin. That’s why I am more than skeptical of SB 50’s intentions and ultimate effect. It functions more as a real estate give away, not as a solution to the state’s affordable housing crisis.