One builder’s solutions to the housing crisis.

Based on one builder’s remarkably candid assessment, building affordable housing is going to remind us of Bismarck’s famous aphorism about the legislative process:  Laws are like sausages. It’s better not to see them being made.

Your elected representatives at work.

Amcal Multi-Housing CEO Percy Vaz, quoted on the commercial real estate site Bisnow.com, gives us a clear-eyed and hard-nosed view of what it’s going to take to solve California’s affordable housing crisis:

  • “Political will to prioritize and expedite affordable housing developments based on a regional needs assessment need rather than subjecting to local Nimbyism.”  No problem–NIMBYs don’t poll well these days–except that today’s activists may be tomorrow’s defenders of the status quo (see boomers). 
  • “Business, labor and political leaders coming up with an affordable housing prevailing wage that is close to market-rate wages.”  Wait!  You mean construction workers take a pay cut when they build affordable housing?  How’s that going to play in areas like Silicon Valley where construction workers are already in short supply? 
  • “Reducing parking requirements below code and eliminating all requirements that are above code [such as green and sustainability requirements].”  Again, no problem–if tomorrow’s workers all bike or skateboard to work.  And to play.  And to run errands.  And that car sharing moves from studies to the real world. 
  • “Reducing impact fees [for affordable housing] to levels below those of market-rate projects.”  Does affordable housing use fewer public services than market-rate housing?
  • “The California Environmental Quality Act, or CEQA, process, while well-intended, is often misused by vested parties for their own economic/political interests to slow, reduce or stop a project. This process needs some major changes to prevent its misuse.”  CEQA has been around since 1970.  Back then, being socially aware meant believing that we were building too much–that development threatened California’s environment and quality of life–and that developers were the enemy.  Today, being socially aware means believing that we can’t build enough–“build big”–and that developers are our friends.  One generation’s brave new world is a subsequent generation’s pothole in the path to paradise.  Could history ever repeat itself? 

 

Haven’t heard most of these trade-offs to building more affordable housing mentioned before?  Probably because Vaz is talking to his fellow builders, not the general public, because we expect you to give up something to get something isn’t what most of us want to hear. 

So what’s one builder doing to make California more affordable-housing friendly?

According to Vaz, Amcal is “advocating for all the above”, plus “simultaneously advocating to remove expensive but unnecessary costs that even market-rate developers do not have to meet, such as…paying prevailing wages, having project labor agreements in place, hiring locally, adding social services to affordable housing projects and building to above-code standards”.

But wait!  Isn’t it socially responsible to pay prevailing wages and hire local?  Doesn’t everyone deserve a home that’s as energy-efficient, sustainably built and environmentally friendly as possible?

Yes, these social goods are “all well-intended”, says Vaz,”but fundamentally add significant costs to projects — possibly by as much as 20% — depriving 20% more families who might otherwise benefit from decent, affordable housing”.

So it’s all about trade-offs.  You’ve got to break a few eggs to make an omelet.  And you can’t have your cake and eat it too.  Or, as Vaz says, “it is better to have a Holiday Inn than the Ritz-Carlton”.

copyright © John Fyten 2017

 

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