Thursday, January 25, 2018

PUSHING BACK AGAINST CITY HALL’S CHEATERS


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By Dick Platkin, City Watch LA, January 18, 2018




Platkin on Planning:  City Planning has developed a host of ways to assist real estate developers building for the high end of the real estate market.  Their helping hand, though, is based on cheating, and it also hides behind several totally spurious claims.  While they don’t yet concede their bait-and-switch approach, their friends, like Senator Scott Wiener, unabashedly support real estate speculators with many outlandish predictions.  According to Wiener and friends, the new market housing will boost transit ridership, reduce residential segregation, slow down gentrification, and meet the housing needs of the homeless, the overcrowded, and the rent-stressed.  Since I debunked most of these claims in last week’s CityWatchLA column, this week I will zero in on the cheating.

City Hall’s first cheating tactic is to rely on inflated population forecasts from the Southern California Association of Governments (SCAG) for the plan horizon years of 2035 or 2040.  With these inflated numbers in place, the media and the public are then told that Los Angeles will soon experience another population boom.  It must, therefore, loosen up its planning, zoning, and environmental regulations to make sure there is enough housing for these newcomers.

One of the best-known cases of these inflated SCAG population numbers was the General Plan Framework Element, an otherwise exemplary planning document.  Based on SCAG’s extrapolation of prior decennial census data, SCAG’s 2010 population forecast for Los Angeles was 4,300,000 people.  But, when the Bureau of the Census released its 2010 data, Los Angeles, only had 3,790,000 people.  Without any explanation, 500,000 people never materialized.

Despite SCAG’s subsequent silence, it is not hard to figure out why the 2010 numbers were so incorrect, and why SCAG’s 2040 forecasts will suffer the same fate.  SCAG’s methodology relies on historical trend data.  Since Los Angeles was once a boomtown, it is easy to extend long-term historical trends into the future and predict enormous population growth.  Then, when the inevitable mistakes become apparent, there is too much resistance from local municipalities, especially Los Angeles, to make mid-course corrections, explain why the forecast methodology was so flawed, and to detail how it will be corrected in the future.   Given this uncertainty and the prominent role of the urban growth machine in local politics, the political winds invariably blow in the direction of inflated population numbers.  Boosterism, not sound social science, prevails.

The truth is that is impossible to make accurate long-term population forecasts.  This is why State law and professional city planning standards call for rigorous annual plan monitoring, including demographic assumptions, followed by comprehensive plan updates every 10 years.  As for local plans, such as LA’s 35 Community Plans, they should be updated every five years, not every 20 years! 

(Since City Hall avoids this heavy lifting, the Coalition to Preserve LA has hired a demographic consult to uncover and analyze the missing and much more reliable [i.e., less inflated] short-term population data.)

As for the long-term forecasts, they invariably fail because they are unable to accurately predict the following population variables:

·                Global economic booms and busts, such as the Great Recession of 2008-9, sabotage any trend line population projections.
·                New technologies, such as streaming video, rapidly change local economies, hiring patterns, and population trends.
·                The growth of foreign competition forces American companies to relocate or shut down factories and businesses, creating job loss.
·                Changes in laws governing immigration to the United States and forced deportations during the Obama and Trump administrations.
·                Revisions to financial regulations in other countries, such as China.
·                Political upheavals and war in other countries, especially Africa and the Middle East, force millions of refugees and political asylum seekers to other countries in search of personal safety.
·                Climate change.
·                Shifting tax and wage laws in different American states.
·                Changing urban programs, such as the massive cuts in the US’s social safety net and public housing programs over the past 40 years.
·                Fluctuating housing costs in Southern California and in other states.
·                Erratic hiring patterns in other states, such as sudden swings in the Bakken fracking areas of North Dakota and Montana.
·                Amendments to local plans, zoning laws, and environmental regulations.
·                Reduced amounts of and rising costs of raw land, forcing developers to ignore adopted plans and turn to suburban areas and infill development.

Since there is no way to overcome these barriers, local government’s only recourse is to rigorously monitor plans on an annual basis, make mid-course corrections, and then fully update their plans when new decennial census data becomes available.  But since this approach to planning conflicts with the business model of real estate speculators, it rarely takes place in Los Angeles.

City Hall’s second cheating tactic is repeated claims that LA’s existing zones and plan designations are not sufficient to meet the housing needs of either current or future residents.  But, since City Planning has not prepared any zoning build-out calculations since the early 1990s, this is pure bluster.  Their claim also contradicts these early 1990 studies, which concluded that Los Angeles could reach a population of 8,000,000 people based on existing zoning. 

These studies, for the AB 283 Zoning Consistency Project and for the General Plan Framework, also indicated that Los Angeles has enough commercially zoned land for all growth scenarios during the next 100 years.  The city does not, however, have enough supportive infrastructure and services for this level of development.  The barrier to growth, therefore, is insufficient infrastructure and public services, not zoning capacity.

Since the era of AB 283 and the General Plan Framework in the late 1980s and early 1990s, the City’s zoning capacity has actually grown, potentially squeezing infrastructure and services even more.  Since every commercially zoned piece of property, as well as most manufacturing zones, can also be used for apartments, and since the RAS zone, the SB 1818 Density Bonus ordinance, and the new Value Capture Ordinance allow developers to increase the height, mass, and number of units in by-right apartment building by 20 percent or more, the claim that LA’s existing zoning is inadequate is even more deceptive than before.

This is, in fact, why the General Plan Framework, repeating housing policies that date back to the Mayor Tom Bradley era, calls for additional housing (if and when it is needed) to be constructed at transit hubs and on long, under-utilized transit corridors.  To get a sense of how much unused zoning potential exists at transit centers and transit corridors, the General Plan Framework’s Chapter Two reports,

Fewer than five percent of the commercial properties currently allowed to develop at a floor area ratio of 1.5:1 have been developed at this intensity.”

Anyone who doubts this, only needs to randomly check out any long transit corridor in Los Angeles, such as Pico Boulevard.  When they do so, they will see miles of one and two story buildings, all of which could be replaced by three story apartment buildings.  Then, through SB 1818 or soon through the Value Capture Ordinance, developer could build four and five story apartment buildings at these same locations without any zoning or planning waivers.

Pico Boulevard is a typical low-rise transportation corridor with vast untapped zoning capacity for housing.

City Hall’s third cheating tactic is to make sure that the City’s sporadic and superficial plan monitoring process does not measure the public’s need for services and infrastructure, nor the City’s ability to provide these services and infrastructure.  Although the programs carefully outlined below describe the required Framework’s monitoring program in detail, City Hall never complied with them:

General Plan Framework Element Policy 42: Establish a Monitoring Program to … assess the status of development activity and supporting infrastructure and public services within the City of Los Angeles. The data that are compiled can function as indicators of (a) the rate of population growth, development activity, and other factors that result in demands for transportation, infrastructure, and services; (b) location and type of infrastructure investments and improvements; and changes to the citywide environmental conditions and impacts documented in the Framework Element environmental database and the Environmental Impact Report.

General Plan Framework Element Policy 43:  Prepare an Annual Report on Growth and Infrastructure based on the results of the (General Plan) Monitoring Program, which will be published at the end of each fiscal year and shall include information such as population estimates and an inventory of new development. This report is intended to provide City staff, the City Council, and service providers with information that can facilitate the programming and funding of capital improvements and services. Additionally, this report will inform the general plan amendment process. Information shall be documented by relevant geographic boundaries, such as service areas, Community Plan Areas, or City Council Districts. 

Without this monitoring information carefully collected, assessed, and then applied to the General Plan, as well as amendments to the General Plan and other discretionary actions, the City of Los Angeles is flying blind.  It is, essentially, a hulking mass of thousands of separate market-driven real estate projects, matched with siloed public agencies whose only focus is their turf of fire stations, libraries, animal shelters, bicycle lanes, and hundreds of other categories.  There is no planning process in place to tie this information together, to understand how it rapidly changes, and to apply it to governance.


City Hall’s fourth cheating tactic is to ignore legally adopted policies in the General Plan Framework regarding criteria for granting zone changes, General Plan Amendments, and related discretionary actions.  To be consistent with the General Plan, these applications must demonstrate that there is sufficient public infrastructure and services for a discretionary action to be granted.  This is why one purpose of the Annual Monitoring Report is to, “…inform the General Plan amendment process.” 

With detailed population, employment, housing, economic growth, and infrastructure and public services data in place, City Hall decision makers could then determine which discretionary actions are consistent with the General Plan.  Without this information, though, they have no objective measures to review and approve several thousand applications each year for discretionary actions, despite the Framework’s legally adopted policies, such as the following:

Policy 3.3.2. Initiate a study to consider whether additional growth should be accommodated, when 75 percent of the forecast of any one or more category listed in Table 2-2 (see Chapter 2: Growth and Capacity) is attained within a community plan area. If a study is necessary, determine the level of growth that should be accommodated and correlate that level with the capital, facility, or service improvements and/or transportation demand reduction programs that are necessary to accommodate that level.

Although the Framework’s language is opaque, this policy states that when the population, housing, or employment levels in a Community Plan area approach the levels forecast for 2010, the City must then determine how much additional growth (i.e., real estate investment) should be allowed through zone changes and plan amendments, and how much infrastructure and services must be first upgraded to accommodate future growth.


Pushing back against the cheaters:  If you want to learn more about how these City Hall cheaters cheat, and more importantly, how you can use this information to shape new Community Plans in your neighborhood, clamp down on excessive planning and zoning waivers, and upgrade public services and infrastructure in your neighborhood, please attend the following workshop on Sunday.  Here are the details, with plenty of time for Q and A scheduled.

What:   “Save Your Zip Code, Angelenos” Training Program
When:   Sunday, January 21, 10:30 – 2:30 PM
Where:  6500 Sunset Boulevard, Hollywood, CA 90028
How:     Parking and lunch provided
Link:     Click here.


*  Dick Platkin is a former LA city planner who reports on planning controversies in Los Angeles for CityWatch LA.  Please send comments and corrections to rhplatkin@gmail.com.  His blog is www.plan-itlosangeles.blogspot.com.


Wednesday, December 20, 2017

Pulling Back the Curtain on Gentrification in Los Angeles

 

LOS ANGELES
PLATKIN ON PLANNING-On Saturday, December 2, City Watch readers are invited to attend the Resist Gentrification Action Summit. The conference, sponsored by Housing is a Human Right.org,  takes place at Audubon Junior High School, 4120-11th Avenue, Los Angeles, from 8 a.m. to 6 p.m. 
According to Damien Goodman, the conference organizer, the gentrifiers have a three-word mantra for every problem facing Los Angeles, “Build more housing!” For those who listen carefully, their hymn has a second verse. It calls for rolling back zoning and environmental regulations on high-end real estate projects. This not affordable housing is the actual focus of their build-more-housing crusade. 
Little do these gentrifiers know, however, that their perpetual claim, that zoning and environmental laws stifle affordable housing production and overall economic prosperity, has been totally debunked.   For this tour de force, it is hats off to Bay Area planning journalist, Zelda Bronstein, for her new article, When Affordable Housing Meets Free-Market Fantasy,  in Dissent Magazine. [Editor’s note: this article is currently reposted in CityWatch.] 
Gentrification Basics: Before readers peel away to read Ms. Bronstein’s article, let me summarize the basic ins and outs of gentrification.  
While gentrification takes many forms, it is always based on the same underlying dynamic. The world is awash with underperforming capital, and real estate, especially market housing, is a lucrative investment option for sovereign wealth funds, hedge funds, mutual funds, insurance companies, corporations, and retirement systems. While their risks might be high, such as another Great Recession propelled by a catastrophic real estate bubble, the profits are immense. After all, in cities like LA landlords can charge tenants between $1000 - $3000 per month for a one bedroom apartment, forcing over 59 percent of Angelinos to fork over 30 percent or more of their income for housing. 
Lending a helping hand to this flood of investment, congenial cities like Los Angeles provide many conduits for investors to quickly move their idle cash into the high-end housing market. Sometimes cities pony up the real estate schemes and scams I recently wrote about on City Watch. Other times, developers rely on that old City Hall standby, pay-to-play, to get their pet projects quickly approved. Then, when they think no one is looking, some developers cut corners and also bootleg their projects, betting that the chance of getting caught is small, and the prospects that LA’s Department of Building and Safety would shut down an illegal project is almost nil.  
Finally, this perfect storm for gentrification also builds on the rapid growth of economic inequality in the United States, especially Los Angeles. As a result, the well-off dominate a housing market skewed toward their tastes and pocketbook. Meanwhile, a growing percentage of the population is only treading water or losing ground. This is why, according to renthop, most people living in Los Angeles can no longer afford to buy a home or rent an apartment. Nevertheless, the purchasing power of the top 10 to 20 percent is enough to drive a real estate market that excludes much of the city, but is still the most desirable location in the U.S. for foreign investors.   
In practical terms, this perfect storm is also causing local demographic changes.  Even though LA’s population is barely growing, the city’s population mix is shifting toward the well-off. Meanwhile, the middle and working class families pushed out of the gentrifying housing market are resorting to the streets, cars, and overcrowded inner-city apartments. Some, of course, choose to leave LA for the Inland Empire, Nevada, Arizona, and Texas. Those who manage to hang on may resent recent changes in retail stores, such as art galleries in Boyle Heights, but this is a consequence of gentrification, not a cause. 
Gentrification takes many forms in Los Angeles: These include mansionization, transit oriented development, evictions through the Ellis Act and cash-and-key, small lot subdivisions, and “churning,” in which landlords force out low-rent tenants by making buildings unlivable. The net result is that these many forms of gentrification eliminate rent–stabilized and affordable housing much faster than it is being built through such programs as density bonuses and Federal tax credits. In fact, during the past 15 years, over 20,000 affordable units have been eliminated in LA alone through the Ellis Act. If other forms of gentrifications are included, such as mansionization, churning, and cash-and-key, the cumulative loss of affordable housing is much greater. 
What can be done? Gentrification relies on supportive governmental policies and programs, all of which can all be amended, rescinded, or reversed to stem the tide: 
  • At the macro level, countries can slow the influx of foreign investment capital into speculative real estate by eliminating EB-5 investor visas or following the example of Switzerland, which reports all earnings back to the investors’ host countries. 
  • Countries can also rely on taxation, minimum wage laws, and social benefits to reduce economic inequality. 
  • States can promote programs, such as Community Redevelopment Agencies, which use tax increment financing for affordable housing construction. 
  • Cities can strengthen their rent control and rent stabilization laws, as well as eliminate evictions programs, like the Ellis Act, that decimate the stock of affordable and rent-stabilized housing. 
  • Cities can curtain many forms of gentrification, such as mansionization, through local land use ordinances. 
  • All forms of gentrifications depend of discretionary actions that can be slowed or stopped by initiatives, such as LA’s Measure S. 
  • Building departments can proactively enforce zoning, building, and environmental laws to slow down the gentrifications process. 
Why does gentrification continue? Why have local media, such a KCET and KPCC, devoted so much airtime to the gentrification story, but with few changes in public policy? Why have researchers at UC Berkeley and UCLA prepared detailed gentrification studies and maps indicating that transit oriented development primarily consists of expensive housing that does not lift transit use. 
The answer is the political side-effect of the economic dynamic that spawns gentrification. Through campaign contributions and lobbying, major real estate investors also promote an institutional culture at City Hill that uncritically accepts the gentrifiers’ arguments and then acts accordingly. As a result, elected officials and their hired departmental managers are pulling out all the stops to attract speculative real estate money to Los Angeles. 
When they point their finger at fanciful schemes to slow down gentrification, remember that there are still three fingers pointing back at them. 
(Dick Platkin is a former Los Angeles city planner who reports on local planning controversies for City Watch.  Please send any comments or corrections to rhplatkin@gmail.com.) Prepped for CityWatch by Linda Abrams.

Sunday, December 17, 2017

City Hall Putting Its Thumb on the Land Use Scale


LOS ANGELES

TOOLS

PLATKIN ON PLANNING-In the fanciful world of high school and college “civics” and political science classes, government is portrayed as a neutral force blindly balancing many competing interest groups. While a few gullible students might fall for this claim, a quick look at the City of Los Angeles puts this notion to rest. 
When it comes to land use decisions, City Hall places a very heavy thumb on the scale in numerous ways to help real estate developers, while simultaneously placing a host of barriers in the way of community and neighborhood groups. Let us, therefore, take a closer look to see how this game is fixed from the start. 
How City departments place many barriers in the way of community groupsMy list is just a start, and I expect that CityWatch readers can supply many more examples: 
  • Most land use decisions are ministerial. These cases are also called by-right decisions, in which applicants only need to comply with the Los Angeles Municipal Code (LAMC). In these situations, the City of Los Angeles’ Department of Building and Safety (LADBS) makes all calls in private. There is no transparency, and it is nearly impossible for local groups or individuals to learn what is proposed for their neighborhood until demolitions take place or construction begins. In fact, it is typical that local residents wake up to the sound of bulldozers, their first indication that the Department of Building and Safety has already approved a project that is breaking ground next door. 
  • The demolition of buildings older than 45 years requires contractors to post a demolition notice 30 days in advance, and also notify City Council offices and nearby residents of the proposed demolition. But few builders comply with this law because they know there are no consequences if they ignore it. Unlike moving violations and parking tickets, the City never enforces this code requirement, even when residents officially submit a code violation to Building and Safety. 
  • When the bulldozers demolish these older structures, the demolition spews lead paint and asbestos into the atmosphere. These toxins are carefully regulated by the South Coast Air Quality Managements District and LA County Public Health. Both agencies require the remediation of these unhealthy pollutants prior to demolition, yet the Department of Building Safety, which issues demolition permits, has no contact with these enforcement agencies. As a result, nearly all demolitions violate State and County health codes, releasing dangerous carcinogens and mutagens, usually next to neighbors totally unaware of what they have been exposed to. 
  • In the rare cases that neighbors want to stop a demolition because of these code violations, it takes several days for either the SCAQMD or LA County Public Health to send out an inspector. By that time it is too late. The contractors have completed the demolition and hauled away the rubble in open trucks, still another code violation. 
  • While neighbors can report code violations directly to the Department of Building and Safety, it is rare that they respond. When they do, they make it clear that they have a three-week response time. Furthermore, in the rare situations when a code violation is actually caught, there are no consequences for developers and contractors. They take the safe bet that they can do what they want and either will not get caught, or if caught, LADBS imposes no penalties on them. 
  • At the heart of this heavy thumb on the scale is the official policy of the Department of Building and Safety, as well as their sister agency, the Department of City Planning, to skip pro-active code enforcement. There is, in fact, no procedure for these employees to proactively report these violations. Instead, the City’s official policy is to only investigate code violations submitted by members of the public, almost all of which are then officially cleared. 
Discretionary land use decisions:  While most land use decisions in Los Angeles are ministerial, the ones that attract the most public attention are discretionary. These are those small percentage of cases in which developers, guided by their accountants, decide to maximize their profits by investing in illegal projects. In these situations, illegal means the projects conflict with the City of Los Angeles’ adopted land use laws. Luckily, the City has made these laws totally porous by providing an escape hatch for every zoning and planning requirement. With a modest amount of effort, real estate investors can circumvent zoning and planning requirements. This, however, is only one digit on the scale since the City really places both hands on the scale to totally tip decisions in favor of real estate speculation. These other mechanisms include the following: 
  • The Los Angeles Municipal Code (LAMC) offers three separate routes through which developers can circumvent the City’s adopted zoning code: The City Planning Commission and then the City Council, City Planning’s Office of Zoning Administration, and the Director of Planning. 
  • In instances where these routes are too cumbersome, developers can pay an extra fee to the Department of City Planning to expedite their applications for zoning and planning waivers. 
  • At this point City Planning approves over 90 percent of all zoning and planning cases, most with conditions. While these conditions may please neighborhoods groups, most are subsequently ignored by City Planning’s enforcement arm, the Department of Building and Safety. 
  • In really tough cases, real estate developers have a remaining option. They can turn to Pay-to-Play.  As carefully researched by the Los Angeles Times during the Measure S campaign, major contributions to elected officials’ campaign accounts and their preferred non-profits curiously produce the zoning waivers developers need to legalize their projects. 
  • While all zoning applications require legal findings through which applicants justify their applications, City Planning has lightened this load by giving a thumbs up to nearly everything submitted to them. Ditto for the City Planning Commission, Area Planning Commissions, and the City Council. They all have an exceedingly low bar for legal findings. 
  • One reason for this permissive approach among elected and appointed decision makers is their background in private sector real estate-related fields, like law. Long gone are the Mayor Tom Bradley days in which he included neighborhood and union representatives in every land use decision-making body. 
  • To further tip the scales for developers, all public hearings and decision-making meetings take place during the day, most at City Hall. Local community people who work or who cannot easily make it to City Hall are placed at a tremendous disadvantage. 
  • While applicants mail out notices for these City Hall meetings, the notices only go to those who live within 500 feet of a project. Furthermore, in some cases, such as Specific Plans, City Planning only sends notices to adjacent property owners. Finally, in other cases, such as Density Bonus/SB1818 and Community Design Overlay cases, there is no notification requirement at all. Planning only mails a determination letter to adjacent property owners. 
  • At decision-making meetings, City Planning staff has the first and last word on all cases, with the public limited to one minute of testimony. In appeal cases, for example, City Planning staff is always invited back to rebut the arguments raised against their decisions, with the public or their representatives not allowed a counter-rebuttal. 
  • Once land use decisions are final, a 14-day appeal period opens up, during which a neighbor could appeal an approval. But, proposals are afoot at City Hall to dramatically increase appeal fees, in some cases from $89 to as high as $13,500.  If the City Council eventually adopts this ordinance, it will eliminate nearly all appeals. 
  • While these barriers all take their toll, the Department of City Planning and the City Council are preparing new ordinances that allow most discretionary projects to become by-right ministerial decision. As this takes place, such ordinances as re:code LA or voluminous appended amendments to Community Plan Updates become law, the number of discretionary cases will dramatically decline. Once this happens, most real estate projects will become ministerial cases invisible to the public until demolition or construction begins. 
Even more barriers:  This list of the barriers to community groups is hardly definitive. But because some dedicated and knowledgeable local groups manage to nevertheless challenge projects, the City Council keeps busy by throwing up new barriers, including the following; 
  • To oil squeaky wheels, the City Council has adopted a long list of small zoning overlay districts, such as Specific Plans, Community Design Overlay Districts, Historical Preservation Overlay Districts, and Residential Floor Area districts. These ordinances are a concession to local residents who have not been successfully sidelined by the barriers described above. Meanwhile, the rest of Los Angeles outside the overlay boundaries, probably 90 percent of the city, remains an easy target for speculative real estate projects. 
  • In 2000 the City Council also adopted a new City of Los Angeles Charter that created Neighborhood Councils. Unlike the hundreds of community groups that already existed in Los Angeles, these new Neighborhood Council are linked to City Hall. Furthermore, according to the Charter, these Councils must have representatives from local businesses, local property owners, local employees, and local institutions, such as hospitals and museums. The result has been that many Neighborhood Councils no longer represent local residents, but, instead, skew toward commercial and institutional interests in their land use recommendations. 
The cumulative impact of the multiple barriers imposed on Los Angeles residents is that City Hall approves nearly all land use applications, with few successful appeals. This, then forces those rare communities that either have enough knowledge or money to hire lawyers to challenge a small percentage of the City’s land use decisions. While some of these legal challenges succeed, especially in Hollywood, developers know the odds are in their favor. Few projects ever end up in the courts because the City’s lop-sided approval process gives developers what they need. And, given their deep pockets, the same developers know they also have a good chance to prevail in court. 
The Upshot or Tipped Scales: While developers, their free market ideologues, and their naive supporters   repeatedly claim that LA’s residents somehow control the city’s land use decisions, this is total bunkum. Translated into plain English, it really means that developers want all of their currently illegal projects to be treated as ministerial decisions. If a few remain discretionary, they then want the approval process to become so short and so certain that they are de facto ministerial cases for which successful appeals are impossible. 
If you wonder about the consequences of this highly unequal land use decision-making process, just check out the real Los Angeles. It features sky-high rents, rampant homelessness, wide spread gentrification, toxic air and water, gridlocked traffic, cracked sidewalks, pot-holed and treeless thoroughfares, bursting water mains, unsightly billboards, miniscule parkland, and swaying overhead wires. These are all byproducts of the same deficient planning process that results when the City’s scales are totally rigged in favor of speculative real estate projects.

(Dick Platkin is a former LA city planner who reports on local planning controversies for CityWatchLA. Please send any comments or corrections to rhplatkin@gmail.com.) Prepped for CityWatch by Linda Abrams.
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