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Budget Cuts Could Imperil Review of Housing Elements

The process of planning for affordable housing in California just got, inadvertently, more affordable. 

Among the many cuts that Gov. Jerry Brown enacted in his effort to balance the budget  is a $1 million hit to the Department of Housing and Community Development Building Equity and Growth in Neighborhoods Fund. That fund supports the department's housing element review activities; with roughly 20 staff members, the housing element review staff will be effectively cut in half. 

Cathy Creswell, acting director of HCD, said that the cuts do not signal a change of attitude or policy within the department. 

"Those cuts do not reflect any lack of commitment or support for a positive state role in housing policy and in particular in the housing element," said Creswell. "It is a time of tough cuts and tough issues." 

Creswell added that the department acknowledges the role that well planned housing can play in combating climate change, as mandated by laws such as SB 375 and Assembly Bill 32. She said that the department is still evaluating its staffing options but insists that the department is open for business and intends to adapt to its financial constraints. 

"We are currently evaluating what we can do and what our options are to maintain this important function," said Creswell. 

In many ways, the budget cuts could not have come at a better time. The implementation of Senate Bill 375 has pushed back the Regional Housing Needs Assessment cycle for the state's four major metropolitan planning organizations. The RHNA process, which is renewed in five-year cycles, sets the parameters for the amount of affordable housing that local jurisdictions must account for in the housing elements of their general plans. 

With this delay in the RHNA process, no housing elements are scheduled to come up for review within the next year. 

"For the next year it's manageable, even with less than half the resources," said Creswell. 

Whereas many HCD functions fund themselves through special funds and fees associated with programs that HCD administers, the housing element department relies entirely on the General Fund operating budget granted to it by the Legislature and governor. In the era of extreme cost-cutting, the department is being forced to take its share of the pain. Legislators had proposed a stopgap measure by which funds from Proposition 1C, an affordable housing bond measure, would be dedicated to housing element review. 

Brown vetoed that provision even though cities are required by state law to produce and abide by housing elements. HCD review is intended to ensure that housing elements comply with Regional Housing Needs Assessment allocation provided by the Council of Governments. 

"The whole state-mandated planning system provides a counterweight to local parochialism that can sometimes affect the backbone of local elected officials and their staff," said Michael Rawson, co-director of the Public Interest Law Project. 

HCD plays a consulting role, reviewing housing elements and helping cities determine if their housing elements conform to their respective MPOs' RHNA prescriptions. If housing elements appear to be out of compliance, HCD will offer recommendations—and is the only public entity with this authority. HCD, however, does not enforce compliance; ultimately, lawsuits – often brought by affordable housing advocacy groups – are the typical method by which housing elements are found to be lawful or not. 

If the cuts extend into 2013, however, it may be a different story.  As the RHNA process gets back on track, a deluge of city housing elements that is expected to come in. The jurisdictions of the Southern California Association of Governments alone are expected to produce 197 housing elements. 

"That is, under the best of circumstances, a huge amount of housing elements due out of one region basically at the same time," said Douglas Williford, deputy executive director for plans and programs at the Southern California Association of Governments. Rawson called it "more of a juggernaut than a rolling series of reviews." 

Presumably, however, a shortage of staff and financial resources could impede the review process, or even mean that some housing elements go unreviewed. Review is not technically required for cities to adopt housing elements and implement them. However, reviews can go through multiple rounds if a draft housing element is off-base, and that process often leads to substantial changes. 

"I've experienced the full gamut between it sailing through with only minor comments that you could address literally within a few days, all the way to months and months of discussion, negotiation, and meetings," said Williford, who praised HCD for being very accessible during SCAG's RHNA process.  

Even cities that are diligent can wind up with noncompliant draft housing elements in part because RHNAs offer significant room for interpretation and variations among cities. 

"It is arcane detail and often does require a lot of discussion. And it can somewhat differ from city to city because every city is unique," said Williford. "That is why it's not always so easy as checking the boxes."

Moreover, advocates fear that the governor's refusal to fully fund housing element review could send the wrong messages to cities, especially those that are reluctant to plan for affordable housing.  

It could also mean that faulty housing elements go on the books and thus become ripe for lawsuits. 

"If there seems to be a creeping recalcitrance because of a perception of a diminishing state of review, that will cause more advocacy on the part of the advocates," said Rawson. 

HCD is doing some advocacy of its own. Creswell said that the department will be reaching out to jurisdictions to assure them that housing elements will get reviewed while also asking for their assistance. 

"We're going to be putting out a memo to all the communities we are working with to let them know that this will not affect anybody we're currently working with," said Creswell. "If they've got a housing element in with us, it will be done in an appropriate amount of time."

Contacts: 

Cathy Creswell, Acting Director of the Department of Housing and Community Development, (916) 445-4782 

Michael Rawson, Co-Director, Public Interest Law Project, 510.891.9794

Douglas Williford, Deputy Executive Director for Plans and Programs, Southern California Association of Governments, 213.236.1800 

 

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