Court: Builders Can be Required to Provide Affordable Housing

Reprint of Article from Orange County Register on June 16, 2015

SAN FRANCISCO

The state Supreme Court on Monday let California cities keep their authority to require builders to include a share of affordable housing in new residential construction projects.

The decision keeps intact affordable housing requirements approved in more than 170 California cities – including 10 in Orange County, according to a 2013 tally.

The court ruled on a legal battle pitting the city of San Jose against the California Building Industry Association trade group.

A 2010 law in San Jose requires new residential developments in the city to set aside 15 percent of their units for sale at below-market rates.

The California Supreme Court sided with San Jose, saying the city's requirement does not require the developer to dedicate any portion of its property to the public or pay any money to the public.

Rather, the law restricts the way the developer may use the property, so it falls in cities' “general broad discretion to regulate the use of real property to serve the legitimate interests of the general public and the community at large,” Chief Justice Tani Cantil-Sakauye wrote.

In this case, those interests were increasing the amount of affordable housing in the city and locating such housing in economically diverse developments, the chief justice said.

The decision is “sending shock waves throughout our industry,” said Mike Balasamo, chief executive of the Building Industry Association of Southern California's Orange County chapter. “It opens the door for more public agencies to target homebuilders and new homebuyers to fund affordable housing in the state.”

These so-called inclusionary zoning laws upheld by the state's highest court are routinely criticized by industry officials as either limiting the supply of new residences created – or raising the prices of those built. That's a result of build ers' reduced profitability after paying the cost of the below-market housing created.

“We're already in a state of massive undersupply of housing,” said housing analyst Mark Boud of Irvine. “It will only get worse as we continue to restrict supply. The need will only increase.”

Affordable housing advocates say that if the build ers' argument had won over the Supreme Court, fewer affordable residences would be built.

“It basically would derail those laws. And if they do come back, they are going to come back possibly less effective,” said Tim Iglesias, a housing law expert at the University of San Francisco School of Law who wrote a brief in the case in favor of the city.

Register columnist Jonathan Lansner contributed to this report.

ICYMI - Help save California: Replace Your Water-Guzzling Toilet

By Dave Cogdill, San Francisco Chronicle

As Californians facing this historic drought together, we know water conservation is critical. We want to know what else we can do to save water. Fortunately, the governor’s executive order has given us a good starting point by rejecting extreme policy solutions and, instead, implementing commonsense and equitable water-use reduction actions, including a time-limited rebate program to help homeowners replace older, water-guzzling appliances with newer, more efficient models. It is this type of simple, but effective, solution that we as citizens and homeowners should embrace.

Policymakers should look at expanding and fully funding retrofit programs by using existing voter-approved water bonds to help homeowners make their appliances and fixtures as water efficient as possible. Doing so would create jobs, put taxpayer approved bond money to good use, and save billions of gallons of water annually.

As an industry that contributes more than $38.6 billion to California’s economy and supports more than 209,000 jobs, California builders have long recognized the importance of building energy-and-water efficient new homes and communities. It is time to apply the lessons learned and progress made on water efficiency in the new construction industry to older housing stock.

In 2011, California’s first-in-the-nation mandatory green building code went into effect, which the California Building Industry Association proudly supported. Today, a new single-family, three-bedroom home with four occupants uses about 46,000 gallons of water per year.

If single-family homes built prior to 2011 updated showerheads, faucets and toilets to meet the new code, we could save up to 233 billion gallons of water annually. This is equivalent to 6.5 percent of current reservoir capacity in California.

Fortunately, swapping out old showerheads, faucets and toilets for low-flow models is one of the most inexpensive of home water-use reductions. On average, the cost to replace a showerhead will run $50, a faucet $50, and a toilet, $250.

Gov. Jerry Brown has taken a concrete first step in instituting a short-term appliance rebate program debuting this summer through the California Energy Commission, the state Department of Water Resources and the State Water Resources Control Board that will provide monetary incentives to replace inefficient water-consuming devices. The California Building Industry Association applauds such a first step, but would also strongly support an expanded, long-term program that uses funds available from previous voter-approved water bonds to make sure every home in the state — at a minimum — has low-flow shower heads and toilets.

The governor has balanced the need for water conservation with doing no further harm to the economy. The building industry will follow his lead and stands as a proud partner to help policymakers find a path to make all homes in California more effective at conserving water.

HOW TO SAVE WATER

Update with fixtures now required under the California Green Building Standards Code. Potential water savings are:

New homes: Use 50 percent less water than homes built in 1980, in three-bedroom single-family homes with four occupants. Of that saving, low-flow showerheads and low-flow toilets reduce indoor water use by 70 percent; clothes washers contribute an additional 17 percent.

Older homes: California has 13,624,106 dwelling units. Of those, 2 out of 3 were built and equipped with toilets and showerheads that can use up to three times more water than those required under the new building code.

Former state Sen. Dave Cogdill is the CEO and president of the California Building Industry Association.

Read article on the Chronicle's website.