Page One

A major casualty of the newspaper industry’s decline is the coverage of local affairs, especially those having to do with governance. Elections and political scandal still get some attention, but most drawn-out legislative processes are at best under-reported, especially when they’re unfolding in Sacramento. Case in point: the local press has ignored two development-oriented bills that have been making their way through the State legislature since mid-February—AB 710, the Infill Development and Sustainable Community Act of 2011, introduced by Assemblywoman Nancy Skinner; and SB 310, the Transit Priority Project Program, introduced by State Senator Loni Hancock. Both bills curtail local democracy; for that reason alone, they merit scrutiny. With the legislature just adjourned for its summer recess, this is an opportune moment to give them a look. 

SB 310, Transit Priority Project Program (Hancock) 

Building on earlier legislation, including AB 3152, the Transit Village Development Planning Act of 1994 (introduced by Hancock’s husband, then-Assemblyman, now Berkeley Mayor Tom Bates), SB 310 fosters so-called transit villages—dense, mixed-use developments near transit stations—by facilitating the creation of infrastructure finance districts (IFDs) that can issue bonds to pay for such districts. Like redevelopment agencies, IFDs use property tax increment financing to pay off the bonds, diverting property tax increment revenues from other local governments for 30 years (though IFDs cannot divert property tax increment revenues from schools). 

Existing law authorizes the legislative body of a city or county to create infrastructure financing districts by ordinance, as long as 2/3 of the voters in the proposed district favor the idea. It also authorizes the legislative body to issue bonds to finance the infrastructure facilities, again as long as 2/3 of the voters approval. SB 310 eliminates voter approval to form and to bond a IFD. 

The Senate’s legislative analyst remarked that “with the removal of the voting requirement[,] the measure is creating more of a redevelopment type agency without the requirement of making a finding of blight.” The League of California Cities has not taken a position on SB 310, but it comments that the bill and others are being put forward just as redevelopment agencies are in jeopardy of elimination and California cities and counties are searching for new sources of revenue. The League supports redevelopment agencies but warns that infrastructure financing districts are “a largely untested tool” that will “not offset the potential loss of redevelopment” funds. 

Bypassing the electorate is only one of the favors that SB 310 holds out to developers. It also allows an IFD to reimburse developers for “any permit expenses pursuant to [the Transit Priority Project Program at hand].” In addition, SB 310 authorizes “participating developers to build an increased height of a minimum of three stories”—presumably meaning three stories above whatever is permitted by existing zoning—“within a zone in which building of three stories or more are authorized.” That provision appears to be relevant to major changes in the housing element of Berkeley’s general plan that were quietly approved by the council on October 19, 2010. These changes encourage densification, as they say in planning circles, around BART stations, including North Berkeley BART. The housing element’s new language says: 

Consider adjusting zoning to allow for greater residential and specified commercial uses along certain transit corrdiors and in proximity to the Downtown, Berkeley Ashby and North Berkeley BART stations. 

Note that all of the current zoning around North Berkeley BART station allows three stories. If Hancock’s bill passes, people living near that station could well see six-story mixed-use developments going up in their neighborhood 

SB 310 has other “made for Berkeley” aspects. To qualify for the economic subsidies, a builder’s project must meet over a dozen conditions. The list reads as if it had been lifted right out of Measure R, which appeared on the city’s ballot last November, and which included Bates’ “Green Pathway” vision—more precisely, greenwashing scam—for downtown Berkeley: provide onsite bicycle parking, car sharing if the city or county has a car sharing program; unbundled parking; transit passes for 10 years as part of the rent or condo fees if transit passes are available from local providers; recycling facilities for tenants’ bottles, cans, paper and plastic containers; prevailing wages to construction workers for residential projects over 100 units; and open space onsite or payment into a fund established for local open space. 

SB 310 limits the fee that developers could pay in lieu of providing open space to ten cents a square foot—an amazingly low figure: the in-lieu fee for a six-story, 60,000 square foot building would be a mere $6,000. No developer would think twice about paying the fee and forgettting about providing open space. 

To receive a public subsidy under SB 310, a developer must also provide 20% affordable units in rental or owner-occupied housing for low- or moderate-income households or pay a fee equivalent to the cost to provide affordable units elsewhere within the city’s or county’s jurisdiction. The sweetener here is that SB 310 allows an infrastructure financing district to reimburse a developer for the cost of building such housing. Note that moderate-income in Alameda County is legally defined as a four-person household with an annual income of over $100,000. 

SB 310 has been endorsed by AFL-CIO, the Natural Resource Defense Council, BART, the State Building and Construction Trades Council of California, Transform, the Santa Clara Transportation Authority and the Metropolitan Transportation Commission, on which Hancock’s husband Berkeley Mayor Tom Bates sits. The MTC’s Legislation Committee recommended the bill to its parent body, saying that it “would offer developers a guaranteed [!] density bonus, access to a streamlined local permit process of 90 days and potential reimbursement of permit expenses to encourage development that expands the supply of affordable housing near public transit.” 

On June 20, the Senate passed SB 310 by a vote of 22-17. It’s now in the Assembly. 

AB 710, The Infill Development and Sustainable Community Act of 2011 (Skinner) 

Skinner’s bill, introduced on February 17, three days after SB 310, has the State encroaching on a matter customarily overseen by local jurisdictions—parking. SB 710 reduces minimum parking requirements for developments within a half-mile of transit, capping those requirements at one space per residential unit and one space per 1,000 square feet of commercial development. Builders could build more parking if they chose to do so, but why would they? Parking is expensive to build; hence AB 710 significantly lowers the cost of development. 

Indeed, supporters argue that Skinner’s bill deserves support precisely because it will encourage infill construction and transit-oriented development (TOD). The legislation has been endorsed by the Greenbelt Alliance, MTC, the Natural Resources Defense Council, BART, SPUR, TransForm, the United State Green Building Council, and a new organization, California Infill Builders Asssociation, among others. 

Interestingly, Skinner’s bill is opposed by some groups that in the past have championed TOD, infill development and smart growth—most notably, Public Advocates and the Southern California Association of Nonprofit Housing (SCANPH). They say that AB 710 does nothing for—when it doesn’t actually harm—the low-income people who are the greatest users of public transit. SCANPH cites a recent study by the Boston-based Dukakis Center for Urban and Regional Policy that found that 

merely focusing on increasing the quantity of homes—without including long-term policies for ensuring that some of those additional homes will be affordable to an area’s workforce and core transit riders can lead to higher housing prices, more car ownership, and less transit use… 

In other words, absent specific legal protections against displacement, TOD, infill and smart growth spur gentrification. 

Moreover, SCANPH says AB 710 poses a direct threat to affordable housing. It cites another of the bill’s opponents, the California Rural Legal Assistance Foundation, which argues that in reducing parking requirements, the bill “may take away a bargaining chip that affordable housing advocates use to extract more affordable housing from market-rate developers.” Under current law (SB 1818), builders “who add more low-income or senior housing to their projects may be eligible either to build more units than applicable land use laws allow and/or receive a reduction in their parking requirements.” SCNAPH and CRLA fear that AB 710 will eliminate the parking reduction incentive in SB 1818’s density bonus program. 

Those fears are addressed in a white paper authored by UCLA Professor Donald Shoup and two others entitled “AB 710 Will Reduce the Cost and Increase the Supply of Affordable Housing.” The three argue—unpersuasively, in my view—that “parking is often so expensive that its cost, not the allowed density, becomes the most effective constraint on building new units”—and that consequently affordable housing developers might not be able to build more units, even if they were allowed to reduce the amount of parking.The paper is posted on the website of the California Infill Builders Association, a group started last November whose founders and current board of directors include Berkeley-based developer Patrick Kennedy. 

On June 2, the State Assembly approved AB 710 by a vote of 76-0. It’s now in the Senate. 

Where’s the Accountability? 

Both of these bills have potentially major impacts on Berkeley land use and neighborhoods. Yet to my knowledge, neither of their sponsors has seen fit to consult, much less inform, her local constituents, about the legislation she is proposing. Amusingly (?), the latest press release on our state senator’s website says that on July 14, she introduced a bill to amend the California Constitution, SCA 15, “The Taxpayer Right to Vote Act,” which will allow a majority of the legislature to introduce a tax measure on the ballot for approval by a majority of the voters. Nice idea, but apparently Hancock’s solicitude for voter oversight doesn’t extend to the funding of transit villages.