Judging by my email, the New York Times has many readers in LA, especially for columnist Ezra Klein’s take on homelessness and his doubts that either Karen Bass or Rick Caruso can handle this crisis.
While I agree with the NYT’s conclusion, that LA’s approach to the housing crisis is “absolutely insane,” I totally disagree with its reasons. I had hoped the paper’s deep dive into LA’s housing conditions would examine the underlying causes for rising homelessness. Instead the paper focused on City Council-adopted land use ordinances that irritate real estate developers. Apparently, it never occurred to these luminaries that long-standing laws and regulations don’t suddenly spark an uptick in homelessness.
How they missed the obvious causes, though, is not a mystery. This country’s newspaper-of-record faithfully represents the interests of the real estate developers who dominate local politics through what UC Santa Cruz sociologist, William Domhoff, calls growth coalitions. According to Professor Domhoff, the press plays a key role in these urban growth coalitions.
This is what urban growth coalitions refuse to acknowledge:
- Existing low-priced housing has been continuously lost through formal and informal evictions, prior to demolitions and replacement by new market-rate and luxury apartments. In Los Angeles this transformation is rapidly taking place in many neighborhoods, especially Downtown Los Angeles, Koreatown, Miracle Mile, Hollywood, and Woodland Hills.
- In Los Angeles has extremely weak rent control. LA’s Rent Stabilization Ordinance (RSO) only applies to apartments constructed before 1978. Furthermore, vacancy decontrol in RSO apartments allows unlimited rent increases based on market conditions. As a result, rents have increased faster than wages, and the number of rent stabilized apartments has continuously declined.
- Federal public housing programs have been incrementally eliminated since the early 1970s, beginning with the Nixon administration. In 2022 the only remaining Federal government low-priced housing program is Section 8, through which rents are reduced for low-income tenants. In Los Angeles the waiting list for Section 8 apartments is now a whopping 365,000 people. These applicants hope to get one of 30,000 Section 8 vouchers, but 20 – 30 percent of them will forfeit their vouchers when they fail to secure a Section 8 apartment. The dismal result is that only 6.6 % of those eligible for Section 8 apartments manage to find one.
- The State of California dissolved all local redevelopment agencies in early 2012. These public agencies were required to allocate 20 percent of the budgets to subsidized low-cost housing. Their abolition ended this remaining source of public housing funding.
- Wages have been stagnant since the 1970s, during which time economic inequality steadily rose. At this point, “The share [of income] going to the top one-tenth of one percent has increased from almost 3 percent to over 10 percent. The top one-thousandth of the income ranking now gets about the same total income as the entire bottom 40 percent of the U.S. population.” This is why an increasing percentage of the American population, including Angelenos, are priced out of housing and face stark choices: overcrowding, moving to cheaper housing markets, or living on the streets.
- Los Angeles does NOT have an inclusionary zoning ordinance. If it did, new apartment buildings would automatically include a specific percentage of inspected low-priced apartments. Instead, Los Angeles has two voluntary density bonus ordinances. The most popular one, Transit Oriented Communities Guidelines (TOC), allows developers to exceed height and density rules in exchange for pledges to include low-priced housing in their new buildings. But no City employees ever physically inspect these residential projects to verify that their low income units exist and are rented to vetted low-income tenants.
- Between 9,000 to 20,000 houses and apartments in Los Angeles are rented to visitors through AirBnB and related companies. This misuse of existing apartments and houses further reduces the supply of potentially affordable units.
- Large real estate companies frequently buy apartments and houses as speculative investments, often keeping them off the market. As a result, The Vacancy Report has identified 93,000 vacant residential units in Los Angeles, twice the current number of homeless people.
The New York Times, Los Angeles Times, and LA’s current and aspiring officials routinely ignore the underlying causes of the city’s housing crisis. Instead they roll out rusty WIMBY (Wall Street in My Yard) chestnuts about rolling back zoning and planning laws that regulate real estate projects. In their neo-Reaganite world view, Los Angeles has not cut enough deals for private developers. Their solution is therefore more roll backs of adopted land use laws and ordinance.
What then does the New York Times identify as the alternative causes of LA’s housing crisis?
- Design and architectural review. But architectural review is rare in Los Angeles. Although the city does have 34 Historical Preservation Overlay Zones, they cover about 5 percent of the residential neighborhoods in Los Angeles.
- Prevailing wages for low-income residential projects. But in Los Angeles the minimum wage is $16/hour and the average wage is $24/hour. In contrast, the hourly wage required to rent a typical two bedroom apartment is $39/hour.
- Green Building Codes. But the purpose of LA’s Green Building Code is spelled out in the Los Angeles Municipal Code, Section 16.10, “ . . . reduce the use of natural resources, create healthier living environments, and minimize the negative impacts of development on local, regional, and global ecosystems.” According to the New York Times, the new 2023 California/Los Angeles Green Building Codes could raise the cost of a house by $20,000. Did it occur to the paper that the reduction in Greenhouse Gas emissions resulting from Green Building Codes soon pays for itself. Why? The mitigation of climate change costs much less than adaptation.
- Air quality ventilation systems on residential projects near freeways. But in the past decade medical researchers have documented the increased health risks faced by those who live within 300 meters of a freeway. The price of letting their asthma and heart disease become life threatening is much greater than protective ventilation systems.
- Parking requirements drive up the cost of housing. But in 1999 the Los Angeles City Council adopted the Adaptive Reuse Ordinance (ARO). It allows the conversion of existing buildings to residential uses with offsite parking. While this parking option allows the conversion of older buildings to residential uses, it revealed that in LA market rate housing requires sufficient parking to be financially viable. This is because tenants in market rate building rarely use mass transit and need spots to park their cars
- Inadequate land for low-income housing. But in Los Angeles existing zoning automatically permits apartments on all commercial parcels. In addition, when commercial lots are near express bus lines, they qualify for Transit Oriented Community density bonuses. As a result, Los Angeles has tens of thousands of parcels on commercial transit corridors that permit large, over-height apartment buildings. The zoning is there, and these commercial corridors already have mass transit and retail services to serve future tenants.
Yes, LA’s housing crisis is absolutely insane, but not for the reasons offered by the New York Times. This insanity is the cost of doing business. Zoning deregulation that benefits real estate speculators forces thousands of people to sleep on sidewalks, alleys, or in their cars, where over 1000 of them die each year from disease and exposure.