CALIFORNIA HOUSING MANDATES AND RHNA
Written as simply as possible. More details available
Summary by Amy Kalish
HOUSING MANDATES EXPLAINED + WHAT IS RHNA? RHNA is the Regional Housing Needs Assessment — the number of housing units (a place for at least one person to live, with a kitchen, bathroom, and door) assigned to an area by the state. This happens in eight-year housing cycles, and the allocation numbers are determined by the California Department of Housing and Community Development (HCD). It is chunked out into regions. Ours — the Bay Area — was assigned 441,000 new units to be distributed over each city. With units assigned by city, there is no coordination for evacuation safety or infrastructure.
WHERE DOES IT COME FROM? The total number is supposed to represent California’s predicted housing needs over the next eight years. This is the 6th RHNA cycle, covering 2023-2031. The HCD says California is short 2.5 million housing units. (Walked back from Newsom’s unsubstantiated campaign assertion of 3.5 million). The numbers have been not only been questioned, we now know they are created “ad how” and the HCD knows they are impossible.
DID RHNA FAIL AN AUDIT? Yes. The 2.5-million-unit requirement was not in line with projected population growth even before the pandemic. A state emergency audit was requested. The result of the audit: The California State Auditor found that the numbers were not reliable, the numbers were not reproducible, and the methodology was opaque. All documentation is available at citizenmarin.org on the AUDIT page. The audit result was ignored by HCD, and the 2.5 million wasn’t adjusted.
IS THIS HOUSING CYCLE DIFFERENT? Yes. The 6th cycle is NOT like other cycles. The numbers are huge. Marin county’s RHNA went from 2,298 (5th Cycle) to 14,405 (6th Cycle). Mill Valley went from 129 units to 865. Belvedere went from 16 units to 160 units. Tiburon went from 78 to 639. Unincorporated Marin went from 185 to 3,569. Chart included below.
DID CITIES APPEAL? Yes. Cities were shocked by the huge rise in their RHNA, and many across the state appealed based on “changed conditions” including drought, fire, lack of evacuation access, flood zones and other hazards, infrastructure issues, lack of buildable land, environmental concerns, etc. All these appeals were denied without comment. You can read all the Marin County appeals on the CITIES page.
WHAT IS A HOUSING ELEMENT? Each locality, by law, must create a Housing Element plan and document showing where the RHNA units can be accommodated, and submit it to the state for approval. In the past, these reports were not too difficult to create and were done by in-house staff. This cycle, the numbers were so overwhelming, and the Housing Element added so many new required reports that cities had to hire consultants to write them. This has been taking time and energy away from our city governments for a couple of years now. Sausalito, the only Marin city so far with a certified housing element, spent over $700,000 of taxpayer money to create it. Unincorporated Marin has spent over $2 million for a 700+ page Housing Element that was rejected twice. As of 3/24 about one third of the cities in the state are still in this position. Find yours here, page 3:
WHO BUILDS THE HOUSING? Except for a few affordable projects that are built on donated city or state land with various federal and state grant monies cobbled together, the state expects for-profit developers to build the housing. However, since market-rate and luxury housing have far-greater profit margins, there is little incentive for them to include more than the bare minimum of affordable units required. Most large projects across the state have gotten this percentage down to 10% to 20% max. This imbalance ensures that the below market rate RHNA will never be completed.
WHY SO MANY NEW HOUSING LAWS? The housing crisis act of 2019 changed everything. Cities were blamed for lack of affordable housing and for not producing enough housing, even though cities do not build. The legislature has passed about 200 new laws to speed up approvals for multi-family developments by forcing local authorities to rezone for greater density, and approve projects swiftly, often without public input or environmental review. The three things that are literally demonized by the state as holding up construction are Zoning, CEQA, and public input. (Those are also called city planning, the environment, and local voice/democracy.) There three things have sometimes slowed the process, but more often produced community/developer/city compromise, and prohibited housing in toxic areas.
Attorney General Bonta’s office has a special housing Strike Force to strictly enforce new laws and policies. He can now intercede and dismiss city lawsuits. Additionally, he will soon have the power to start fining cities as soon as they are deemed out of compliance with any process, instead of allowing them a 60 day period to submit . Besides fines, most punishments give developers more power, and cities less. Fines can bankrupt cities, put them into receivership, and require cities to cede all zoning control to the state. The state can then decide which public lands will be donated or sold for housing projects.
DOES THIS CREATE LOW INCOME HOUSING? The laws are sold that way, but they do the opposite: create luxury market-rate housing with a few less expensive units for low-income households. Since developers lose money on the low-income units, they are offered concessions like elimination of height, setback, on-site parking, and tree cover requirements. There are density bonuses (state and local) that increase the number of units — only the market rate units — that can be built on a parcel.
DOESN’T THAT JUST RESULT IN MORE EXPENSIVE HOMES? Yes. RHNA is broken into categories, each of which needs to be fulfilled exactly, or the city is declared out of compliance. For example, Belvedere will be required to build 160 homes, 100 of which need to be for low- income households. But even if a new development project includes 20% affordable units, the City would need to approve five times the number of units to get the required low-income ones built. That means building 500, maybe even 1000 new homes here in order to get 100 new low-income units. The numbers will never add up! The policy is based on the concept of “trickle down” housing — if enough housing is added it will result in lower rents and housing costs. Unfortunately, the private market stops building before that saturation could ever occur. In cases sited as “working,” the reduction is a very minor reduction of rents — in surrounding buildings. This is not a market sampling.
WHAT IS LOW INCOME IN MARIN? Marin has a high median income, and a percentage of the median income is the basis for the categories. The low-income category in Marin starts at $104,000 for a single person, and goes to about $150,000 for a family of four, etc. See the chart below.
DOES THE CITY GET CREDIT FOR THE UNITS APPROVED? No. The state doesn’t measure success by entitlement (approval) of projects, but by the numbers of permits pulled and housing units completed. Cities do not build, developers build, but the state will penalize them anyway. San Francisco has tens of thousands of approved units in their pipeline, and developers have chosen not to pull permits or build. San Francisco is punished for that, even though they have no control over market forces or the circumstances of each developer. . In times of high interest, high construction costs, lack of insurance, supply and labor shortages, high wildfire risk, drought and increasing energy costs, development slows. But the State still blames the cities.
As of 3/24/24 there are almost no private insurers left in California. State Farm just announced it was planning to non-renew 72,000 remaining policies this year. The California backed “insurers of last resort,” the FAIR plan, announced it would be insolvent after one major incident.
Major California property insurer to not renew roughly 72,000 policies | Sacramento Bee
IN CONCLUSION: There are shortages of affordable housing throughout the state, but there is no crisis regarding expensive homes, and until the state decouples housing mandates from private development, we’re going to see a surge in production in the wrong direction.
All cities in Marin — and the state — are set up to fail.
Many legal avenues relief through the courts have been cut off. As if the writing the SB9 lawsuit has not yet been decided, but the state has prevailed in almost every other case.
The housing laws create a future that is antagonistic and unproductive between cities and the state.
