ECA Newsletter 3-28-19
CASA Compact – It Is Not Going to Go Away
Please bear with me for a very brief “background” to the CASA Compact:
1. Housing has been a very “hot topic” (excuse the pun please) for many years. The fires aggravated an already depleted supply of housing units that were needed in the North Bay region. Since late 2017, any number of meetings, workshops, proposed solutions have been discussed, hashed over, and reported on ad nauseum. One group that is part of the Metropolitan Transportation Commission put a group of developers, financiers, elected officials, and housing experts together to come up with some ideas to spur housing starts in and around the Bay Area. What they came up with is called “The CASA Compact”
2. To view the background info on the CASA Compact, click here–
3. To view the actual CASA Compact document, click here–
Okay-now for the fun stuff. Many of the smaller cities loath the idea of the CASA Compact because they interpret it and fear it. Although some of our friends are supportive of parts of the CASA Compact, and my “opinion here” may rub them the wrong way, when have I ever been worried about that? Here is my short and sweet opinion piece on the CASA Compact:
A) Small cities feel bigger cities have created the most jobs and the least housing. Why should smaller cities have to be taxed to fix the problems created by the big cities? The cost and the requirement should be borne by the bigger cities and to a lesser extent, the smaller cities but not the same ratios should apply.
B) Small cities do not want to relinquish land use control of their available building sites and they presume they may lose it if they do not build enough housing to hit their “quota”. They are possibly right. Do we want someone else telling our local government how many houses and what size to build? This is complicated. If the local City has consistently been “no growth” and caused a strain on our roads by forcing workers to commute in from outlying areas to get to their jobs, I say yes-force them to build workforce housing.
C) Many of the industry leaders question whether rent control and just cause evictions will put a “wet blanket” over any interest developers and investors might have had to build apartments and smaller affordable rental units because their income stream is being tampered with. Read CASA Compact #1 on Just Cause Eviction and CASA Compact #2 on Rent Control. I personally think they are contrary to “incentivizing” a developer/investor to put up their dollars on a project.
D) Providing legal assistance to renters who are being evicted for not paying their rents make landlords cringe and throw up their hands in despair. The word on the street is if CASA Compact #3 is adopted, most of the landlords I know will sell their rental units thereby taking many rental units off the market rather than creating more rental units. Read CASA Compact #3 on Legal Assistance to renters. I hate this one.
E) There are some good things in the CASA Compact and many I have spoken to some who like CASA Compact #4 on removing ADU regulatory restrictions. ADU stands for Affordable Dwelling Units or (Granny Units as they are sometimes referred to). One out of four “isn’t bad”.
F) Zoning changes near transit terminals makes some sense to me but it always scares me cost wise) when I read about “Labor Standards” as it relates to subsidized housing costs. To me-that means union labor will be required when I (and others) are not sure the cost to build these units “pencil out” now and certainly will not if labor costs to build them go up. CASA Compact #5 is about zoning changes and I can see the developers who are getting pressure to build and have too few labor forces to draw from. Perhaps the time has come to use all the tools available to us-union labor and non-union labor. I cringe when regulations force one or the other out of the picture though. I am reluctantly thinking ok on this one.
G) Figuring out the actual cost of impact fees and inclusionary costs (how many “affordable” units need to be included in a project is the simple way to express what CASA Compact #6 is about). This is too complex for me and others to digest. I defer to my friend Bob Glover of the BIA who says this is a good thing to enact. Ok on #6 because Bob says it is good.
H) CASA Compact #7 is about expedited approvals for some housing. Hell yes. Get the approval process 100% out of the equation as far as I am concerned. Let the market dictate and let the Contractors and Engineers be responsible for code compliance. This #7 is the best one yet!
I) CASA Compact #8 is about making public land available to build on. If one district is not providing enough land for residential zoning to keep up with housing demand, make them. I like it.
J) CASA Compact #9 is about the cost to “Joe Q Public” to pay for all of this. I suspect once I look at this in more detail, I will hate it. Always about the taxpayer having to bail out the government who has neglected infrastructure and housing needs for decades. Now it is a crisis. Do we say “No” or hold our nose and “Pay”?
K) Finally-CASA Compact #10 describes a new agency to oversee everything. I hate this one the most already.
The CASA Compact is a 15 year “guideline” but do not think it is benign. State Legislators are hard at work with over 50 Bills being cooked up right now to satisfy some of the CASA Compact items.
This is not going away.
That’s All Folks!