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In recent weeks, we've seen a lot of moves that suggest it may be time to change the way California funds transportation, including the following: Board of Equalization Member George Runner has been touting a 21% cut in the gas tax as part of the "fuel tax swap" formula from a few years ago. A committee headed by former San Diego City Councilmember Jim Madaffer is looking at how to implement a mileage tax as an alternative to the gas tax. Assembly Speaker Toni Atkins has proposed  a $52 annual fee on most drivers as a way to raise almost $2 billion for road repairs. The gas tax isn't the only source of funds for transportation in California, of course. Local transit agencies and some local street and road repairs are funded by the sales tax on gasoline – not the same, obviously, as the gas tax. Most large counties have an additional sales tax on gasoline to pay for transportation and road repairs. But most of the state's big-ticket transportation projects are paid for out of the gas tax, and the buying power of that funding source has been in decline for decades. Typical of California public finance, the whole gas tax story is so convoluted it's nearly impossible to understand, primarily because of the "fuel tax swap" back in 2010, which increase the gas tax in exchange for reducing the sales tax on gasoline. But for all practical purposes the gas tax has not increased since the year that today's college seniors were born – 1994. (Yes, the tax has increased but only as part of a deal that reduced other taxes to maintain the pool of transportation revenue even.) Since then, the state has added about 7 million new residents. Yes, gas tax revenues have gone up in recent years. But hybrid engines and greater fuel efficiency has cut into the growth in gas tax revenues. The value of every sales tax dollar has dropped by 40% due to inflation. Taxable sales of gasoline dropped every year from 2005 to 2013, though it's since recovered. It's no wonder, then, that the state and its local governments still struggle to pave streets and roads and fund the long list of transportation projects that comes to Sacramento for consideration every year. And it's no wonder that the gas tax looks to be on its last legs. Though it's technically a tax on the purchase of gasoline, the gas tax has always functioned in effect as a user fee: The more you drive, the more you pay. And the gas tax has always been the financial foundation for the California freeway system. It was the passage of what was then known as the Collier-Burns Act in 1947 – which increased the gas tax by 50% -- from 3 to 4.5 cents per gallon – that funded the freeway system and helped California avoid toll roads in the postwar era. (Gas cost 23 cents a gallon at the time.) For most of the postwar era, the gas tax formula worked fine. But a wide range of factors – inflation, the rising environmental and labor costs of transportation projects, and better fuel mileage to name just a few – have conspired to undermine the gas tax as a stable funding source. Policymakers in California have known about this problem for a long time. I can remember back in the ‘90s running into Richard Katz – then the chair of the Assembly Transportation Committee – shaking his head. He'd just gotten pathbreaking California's electric vehicle law passed, only to realize that if it worked it would reduce the gas tax revenues he needed to move other parts of the transportation agenda. In case you haven't noticed, the federal government has had the same problem. Rather than raise the gas tax – or reduce transportation spending – Congress has been shoring up the federal transportation trust fund by borrowing billions of dollars every year from the federal general fund. So California – like other states and he federal government – is faced with a bunch of tough choices. Here are some of the things the state might do: Raise the gas tax – though this is both politically difficult and, for the reasons described above, an imperfect approach. (Among other things, the fuel tax swap has resulted in California having one of the highest gas taxes in the country.) Switch to a mileage tax – something that may have legs in California, since the main criticism seems to be that the government will know your driving habits, which is a Republican criticism rather than a Democratic one. Create some additional fee on drivers, as Speaker Atkins has proposed – though there might be some pushback against this as being an additional tax. Or, of course, live with the money we get now. This last one is tough but actually worth thinking about. The problem for both states and the federal government in recent years has been pretty simple: There's enough money to maintain the transportation system we have  or  build new transportation facilities, but there's not enough money to do both. That's why some mostly left-wing advocates have argued for a "fix-it-first" approach, on the theory that focusing on maintenance will mean the current system will be in better shape but sprawl will be discouraged because new facilities won't be built. Even conservative politicians, of course, like to be able to cut ribbons on new facilities, so "fix it first" may not have legs. But something has to give. The gas tax era is over.

A couple of weeks ago I heard a spiel by one of the founders of a new startup called Feastly , which is trying to pair up chefs with diners. Chefs wake up in the morning, go into their kitchen, prepare whatever they want, put out a call on the Internet - and if it's something you want to eat, you go to their house and dine. Feastly, in other words, turns every dining room into a restaurant.

I’ve lived in both cities. I’ve devoted most of my professional career to understanding the two of them. And, conflicted as I am about who to root for in the World Series, I’ll say this: It’s a great matchup because Los Angeles and Houston are so similar as urban places – the two largest cities in the American Sun Belt. And as a current Houstonian and former Angeleno, it’s worth saying that Los Angeles holds important lessons – good and bad – about our future. When I moved to Houston three years ago – after living in Southern California for thirty years – the thing that struck me more than anything was how similar its urban form is to Los Angeles. An enormous, low-rise city laid out on a grid across a gigantic coastal plane. Glued together by a highly developed freeway system. Punctuated by large job centers scattered across the landscape. Slowly realizing that maybe cars aren’t the answer to everything. And gradually rediscovering the underlying natural environment that gave rise to the city in the first place. Over time, I’ve come to see that even in non-physical terms, the two cities are similar. Demographically, this similarity is really striking. Both cities are about 40% Hispanic, and their metro areas have an enormous array of nationalities and ethnicities. The only big demographic difference is that, because it was traditionally a Southern city, Houston has a larger African-American population. But even in that case, what’s important is not the difference but the connection . Los Angeles’s black population migrated largely from Texas and Louisiana, and the connections back and forth are important. (In Walter Moseley’s Easy Rawlins novels, Easy lives in South-Central but grew up in the Fifth Ward.) As one of the westernmost historically black colleges and universities, Texas Southern draws more than its share of Angelenos. And among other ethnic groups, Houston is increasingly viewed as an affordable alternative to Los Angeles. Houston has the largest Vietnamese population outside of California, and the relationships among East Asian communities in particular is strong. Not long ago I spoke with a dentist and his wife of Chinese extraction who grew up in Los Angeles and then lived in the East and the Midwest. They settled in Houston because of the large Chinese population and the general view that, if they couldn’t afford to live in Los Angeles, Houston was the next-best place to be a Chinese-American. It’s a little facile too easy to say that Houston and L.A. are similar because they grew up as postwar auto-oriented cities. It’s important to understand that, at least at their core, both cities are older than you might think. Yes, they are the two largest cities in the Sun Belt. But they have been the two largest cities in the Sun Belt since 1950 , when Houston passed New Orleans as the largest city in the South. L.A. emerged early as a center of aerospace and manufacturing, Houston as a center of cotton trading and then energy. Both benefited greatly from World War II industrialization. Both are port cities, and in fact the expansion of the Panama Canal is likely to increase the competition between the ports. Both had – and still have – enormous freight rail infrastructures, which are deeply interconnected. (It’s not unusual for freight traffic in L.A. to get screwed up because of some snafu in the Port of Houston.) Nevertheless, it is true that they both boomed in the 30 years after World War II to become the poster children for Sun Belt sprawl, both good and bad. L.A. and Houston were carpet-bombed with basic, low-amenity suburban tracts in the ‘60s and ‘70s. Yet they have also been centers of urban innovation. When I was a young urban planner learning about “new towns,” everything I read kept leading me back to Irvine and The Woodlands, which are similarly innovative as master-planned communities. Even in baseball, the two cities were leaders of postwar suburban innovation. Dodger Stadium and the Astrodome – dating from 1962 and 1965, respectively – were hands down the two most important and innovative baseball stadiums built between the 1920s and the 1990s. These were the stadiums that led the way with exploding scoreboards, varied cuisine, and ample parking. (See Josh Stephens’s CP&DR review of a new book about Dodger Stadium.) As I learn more about this moment in Houston’s history, I am struck by the similarities with the Los Angeles I lived in during the late ‘80s and early ‘90s. The emerging world-class traffic problems. (The 610 Loop around The Galleria reminds me so much of the 405 on the Westside.) The dependence on traditional industries that may not be around forever. The struggles of a black-white city accommodating a wide range of emerging ethnicities, especially a fast-growing Hispanic population. The unaffordable housing. The gradual coming to terms with the idea that a world-class city must be urban, not suburban, in nature. And so what can Houston learn from L.A.? My takeaway is: Don’t wait too long to embrace the need to be a more urban place. For Los Angeles, the tipping point came in the ‘90s, when traffic got so bad Angelenos began to realize they would never be able to fix the problem with more freeway lanes. Since then, L.A. has embarked on the largest transit construction effort of any American city in the last 100 years. It will pay off in the long run, but in the short run traffic is still miserable, the transit oases are few and far between, and Angelenos are taxing themselves to death trying to get ahead in the process. So don’t get too far behind the curve – in transportation, housing, and diversifying the economic base. Oh, and by the way: I’m not really having a hard time deciding who to root for. The Dodgers are a great ballclub. But the Astros are the most exciting, fun young team I’ve seen in a really long time.

A local judge has ruled that the City of Dublin should have conducted an environmental analysis under the California Environmental Quality Act before placing a measure on the ballot that would permit development in an area previous protected under the city’s Open Space Initiative.

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Judge Sides With Developers On Preliminary Application Timing

As CP&DR has written repeatedly over the last couple of years, SB 35 is turning project-level housing review upside down, especially in the Bay Area. But by and large, SB 35 – which limits cities to ministerial review over housing projects in some circumstances – has been used to promote market-rate projects in upscale locations like Berkeley , Cupertino , and Los Altos . This isn’t surprising, especially since a precondition for SB 35 is paying construction laborers prevailing wage – an expensive proposition that usually requires a big revenue stream.

In the 1990s, Rick Cole presided over the update of Pasadena's general plan, which led to the development of one of the most recognizable transit-oriented developments in the United States (recognizable to planning nerds, at least): the Del Mar Transit Village on Los Angeles Metro's Gold Line. At the time, the city was a hotbed of New Urbanism thought, of which the Del Mar Transit Village was a prime example. Despite the high profile of New Urbanist ideas, and of the  Congress for the New Urbanism , Del Mar remained a relatively isolated example of the ethos and the aesthetic. In the ensuing decades, Cole moved on to serve as city manager in Azusa and Ventura (where he collaborated with CP&DR Publisher Bill Fulton), and in the past decade he served in the Los Angeles Mayor's Office and, most recently, as city manager in Santa Monica, from 2015 to 2020. The consummate Californian and longtime proponent of New Urbanist is now taking on a formal, national role, as the leader of the Congress for the New Urbanism itself. Cole official became CNU's executive director in May. CP&DR's Josh Stephens spoke with Cole about New Urbanism's influence on California, California's influence on it, and its prospects here and around the country now that it has gone from a radical upstart theory to a motivating force among many progressive planners, designers, and developers. Related CP&DR Coverage  New Urbanism Tag Train Moves New Urbanism Forward  Image credit: Brett VA via Flickr .

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In the latest twist in a long-running battle to build more on-campus student housing at UC Santa Cruz, the Sixth District Court of Appeal has ruled in favor of the university in an unpublished ruling.

Fix The City, a limited-growth group active in Los Angeles, has lost an attempt to retroactively challenge the city’s Transit Oriented Communities guidelines. However, an appellate court did say in an unpublished ruling that Los Angeles must re-do its seismic analysis on a proposed apartment building in West Los Angeles.

California Forever Postpones Ballot Measure, Will Conduct Two Years of Analysis and Outreach California Forever, the parent company behind the East Solano Plan to build a new city of up to 400,000 residents on the northeastern edge of the Bay Area, reached an agreement with Solano County on a new process for advancing the plan. The company will not seek a zoning change via a previously scheduled November ballot initiative. Instead, the company will submit an application for a general plan and zoning amendment and will work with the county to complete an environmental impact report and development agreement, and then bring the full completed package forward for voters to consider. The process is expected to take about two years. The hasty ballot measure "politicized the entire project, made it difficult for us and our staff to work with them, and forced everyone in our community to take sides," wrote Solano County Supervisor Mitch Mashburn in a statement . "Delaying the vote gives everyone a chance to pause and work together, which is what is needed - not a fight between friends throughout the County on both sides of the issue." "This creates opportunities to incorporate additional community input, and then provide everyone with access to objective analysis," wrote Calfornia Forever CEO Jan Sramek. "We believe... we can build a shared vision that passes with a decisive majority and creates broad consensus." According to a poll commissioned by California Forever, 54% of county voters felt the plan was moving too quickly. (See related CP&DR coverage .) Berkeley May Implement Citywide Upzoning for Small Multifamily Developments This evening, the Berkeley City Council is scheduled to consider a motion that, if adopted, would permit one of the most dramatic upzonings in state history. The motion, introduced by former Councilmember Lori Droste in 2019, would permit the development of small multifamily buildings across large swaths of the city. Buildings could be as many as three stories high and include as many as 12 units. Opponents are concerned that new market-rate developments could alter the character of single-family neighborhoods and/or concentrate in low-income areas where historically disadvantaged residents might be displaced. (See related CP&DR coverage .) State Updates Maps of Surplus Properties, with Eye Toward Housing Development The Department of Housing and Community Development and Department of General Services released an updated map called the State Excess Sites - Affordable Housing Opportunities Map, aimed at assisting developers in locating state-owned land suitable for affordable housing projects. This update follows Executive Order N-06-19's mandate for HCD and DGS to prioritize surplus state properties for affordable housing to alleviate California's housing shortage. Using criteria established under AB 2233 and SB 561, over 44,000 state-owned parcels underwent rigorous evaluation based on feasibility and financing competitiveness, employing GIS technology and visual assessments by DGS and HCD staff during 2023-2024. The map provides a comprehensive view of potentially suitable sites declared surplus by state departments, offering developers tools to explore available lands and overlay datasets such as HCD/TCAC Opportunity Map and transit areas to facilitate funding applications and streamline development processes. Interested developers are encouraged to subscribe to HCD's Housing Planning and Policy email list for updates on submitting proposals, although no sites are currently open for allocation. Terner Center: Construction Defect Law Suppresses Condo Development UC Berkeley's Terner Center for Housing Innovation released a report on California's construction defect liability laws and their substantial disincentive on developers and contractors interested in building new condominiums. An estimated 3 percent of all multifamily homes built in California between 2011 and 2021 were for sale rather than rental. In 2022, homeowners occupied less than 10 percent of units in existing structures with more than 5 units. The also report found the number of new homes smaller than 1,400 square feet built in 2020 were less than 10% of all homes built statewide. The state's construction defect liability law extends the liability period extends for ten years after construction completion for condominiums, whereas it is only four years for rental housing, creating a longer and potentially more costly liability exposure for developers of condominiums, contributing to their reluctance to invest in such projects compared to rental housing developments. The Terner Center concludes that a thorough review of California's current approach to managing construction defect liability, aimed at reducing litigation, cutting costs and fostering consumer confidence, is essential for expanding homeownership opportunities across the state. San Diego Seeks to Boost Fortunes of Business Districts The San Diego City Council unanimously adopted a comprehensive set of 99 new policies aimed at enhancing business districts, promoting ambitious housing projects, and clarifying zoning regulations. These changes include easing rules for converting shopping malls into housing, simplifying the approval process for sidewalk cafes and facilitating the opening of substance use and mental health clinics for homeless populations. Additionally, the package seeks to streamline the establishment of urgent care clinics across neighborhoods and mandates improved accessibility for pedestrians, cyclists and mass transit users near new arenas and stadiums. These updates, pending Coastal Commission approval, are poised to have significant impacts citywide, particularly downtown, where incentives for development on underutilized sites and improvements to public spaces are among the proposed changes. 2023 Housing Progress Report Details Sixth Consecutive Year of Growth The state's 2023 Housing Element Annual Progress Report Update reports that in 2023, completed residential units increased by 13.1% to 112,076, marking the sixth consecutive year of growth since 2018. Multifamily housing remained robust with 308,577 units in the housing pipeline, surpassing the previous five-year average. ADU production reached record highs with 27,919 permits issued in 2023 as the share of affordable housing for lower-income Californians expanded significantly, comprising 19% of permitted units and 16% of completed units in 2023, up from 9% and 7% respectively in 2018. Further, development timelines also shortened across all phases, attributed to legislative initiatives like SB 423 and SB 330, underscoring ongoing efforts to accelerate affordable housing production and streamlined development. CP&DR Coverage: Housing Incentives Create Strange Bedfellows Everything about housing development is antithetical to Costco's business model. Costco is in the business of building the same big-box store - with the same gigantic parking lot - pretty much anywhere. Urban infill housing is costly, complicated, and customized. But some people will do anything for an entitlement. That's why Costco's proposal to develop a roughly 800-unit apartment complex in South Los Angeles is a Trojan Horse that will also not-so-secretly facilitate the development of the chain's 17th Los Angeles County store. It will be built on the site of a shuttered medical center a few miles west of the USC campus, near a stop on L.A. Metro's Expo Line. Rather than wade through the tedious, costly, and uncertain process that would it need to gain approval for a traditional standalone store, Costco and its development partner Thrive Living taking advantage of AB 2011, which exempts multifamily housing projects on commercially zoned property from CEQA review, plus density bonuses provided by Los Angeles's Transit Oriented Communities program. Quick Hits & Updates Advocates in San Francisco are proposing a ballot initiative aimed at imposing a new gross receipts tax on ride-hail companies like Uber and Lyft. On Friday, they delivered 17,000 signatures, surpassing the required 10,000 signatures with a significant margin. This measure, known as the ComMUNIty Transit Act, aims to generate $20-30 million annually to support the financially struggling San Francisco Municipal Transportation Agency (SFMTA), potentially mitigating upcoming service cuts amid a projected $130 million deficit for fiscal year 2025. The initiative, likely to appear on November's ballot, seeks to stabilize Muni service levels and fund programs for low-income and youth riders. (See related CP&DR coverage .) A new Assembly Select Committee on Permitting Reform been formed to consider how to overhaul the state's complex land use permitting processes, aiming to expedite approvals for housing and climate projects. The committee plans to continue hearings throughout 2024 and intends to publish a white paper early in 2025, outlining findings and proposing legislative reforms to address these challenges. The Visalia City Council approved an 80-acre annexation in the Visalia Industrial Park to facilitate nearly 1 million square feet of construction by YS Industries despite potential litigation from a labor union. The project, located at Shirk Street and Riggin Avenue, moves forward with support from the city, which is preparing to defend its decision in upcoming legal proceedings initiated by the Laborers International Union of North America, Local Union 294. Cupertino's mixed-use development at the former Vallco shopping mall site, known as The Rise, is moving forward following the city's resolution of a fee dispute with Vallco Property Owner LLC. Approved in 2018, the project includes 2,699 housing units, with 890 designated as affordable, along with retail space and office facilities totaling nearly 1.9 million square feet. The dispute, centered on impact fees and parkland dedication fees, was settled with an agreement requiring The Rise project to pay approximately $10.3 million in transportation impact fees and $32 million in other payments to the city over the project's lifespan. (See related CP&DR coverage .) A Southern California environmental group, Save Our Forest Assn., has filed a federal lawsuit against the U.S. Forest Service for permitting BlueTriton Brands to extract water from the San Bernardino National Forest, claiming violations of federal laws. The group alleges that the water extraction has significantly harmed Strawberry Creek and demands the removal of infrastructure and cessation of operations, citing environmental damage and unlawful occupancy of public lands by the company. The California Energy Commission has approved a comprehensive plan to develop a vast floating offshore wind industry off Humboldt Bay and Morro Bay, aiming to generate 25 gigawatts of electricity by 2045. The initiative, unprecedented in its scale and complexity, requires substantial public and private investment to address environmental concerns, upgrade infrastructure and create a specialized workforce. Los Angeles Mayor Karen Bass has introduced stricter tenant protections and other guardrails to Executive Directive 1, her administration's affordable housing program, aiming to protect low-income residents and historic resources. ED 1 streamlines approvals for affordable housing, and the city is developing a version for market-rate housing. With the new rules, projects in historic districts and on sites that currently have rent-controlled buildings will no longer be streamlined. Critics view these changes as significantly scaling back a program that has spurred much-needed housing development, potentially hindering efforts to address the city's escalating housing crisis. (See related CP&DR coverage .) Lynda and Stewart Resnick, California's wealthiest farmers and owners of The Wonderful Company, plan to expand their distribution center in Shafter into a major international trading hub, converting 1,800 acres of almond groves into warehouse space. Their project will include a new highway and a $120 million rail terminal with promises of up to 50,000 jobs, yet there is much concern about the environmental impact of increased truck traffic and construction. UC San Diego Chancellor Pradeep Khosla is seeking approval from UC Regents to spend $2 billion on a new village that could house up to 6,000 students, addressing a severe housing shortage driven by rapid enrollment growth. The project aims to alleviate the ongoing housing crisis and could begin construction in 2026, with the first 2,000 beds available by 2029. San Diego County reinstated the use of CEQA Guidelines Section 15183 to streamline reviews of general plan-consistent projects, allowing them to bypass vehicle miles traveled (VMT) analysis and mitigation requirements despite changes in CEQA transportation analysis standards.