Time to Move Out: Santa Monica is Coming For Your Home With Upzoning Plans for R-1 Neighborhoods and Putting Public Housing In Your Backyard
The entire top-down, governmentally directed placement of number and types of housing in the region, and in Santa Monica, is doomed to failure.
April 5, 2021
Dressed up in the language of compassion and social justice, the City Council's vote on March 30 to accommodate 6,168 affordable housing units, 70% of whatever new housing is built, and then to disperse these affordable units throughout the city, including along Montana Avenue and Main Street, is in reality a despicable theft of the earnings of hardworking residents and will end up benefiting no one.
There are so many fatal flaws in the logic, data, and goals involved in both the city staff's report on housing and the council's 4-3 vote that it is difficult to know where to begin. But it was clear from the beginning, when the Southern California Association of Governments first directed Santa Monica to zone for an additional 8,895 units over the next 9 years, that the city council was salivating over the moral opportunity to be gained by somehow shoehorning in this many new units, an increase of 17% over the current housing stock in the city, and by ensuring 70% of them were affordable. Unlike other beach cities, including Huntington Beach, Newport Beach, and Rancho Palos Verdes, Santa Monica did not appeal SCAG's number. As a planning department staff member explained during a webinar, it is important that Santa Monica "do our part, do our share." Anything else "wouldn't have been consistent with the approach the city has taken."
The entire top-down, governmentally directed placement of number and types of housing in the region, and in Santa Monica, is doomed to failure. No one entity, no matter how allegedly expert, can determine the best way to allocate any sort of commodity. In fact, top-down commodity allocation is the absolute worst, least efficient, most costly method and invariably results in the worst possible outcome. Should the city proceed with their plan to build - at public expense - "affordable housing" on Montana Avenue and Main Street, historically small, residential neighborhoods, they will kill the atmosphere, physical and economic, of those neighborhoods.
An additional death knell to the character of the city will be dealt by how the city plans to fund all of this affordable housing, which they estimate will cost $4 billion. Currently, the city pays for 60% of all affordable housing built. To fund 60% of $4 billion, city staff propose upzoning (presumably everything), and somehow "capturing" the increased land value "for public benefit," which to them means affordable housing. But even if they ruined every R-1 neighborhood in the city, allowing Manhattan style high-rises, they would not be able to fund two affordable units for every one market-rate unit built. Whatever value the land has for market-rate units - and however many units may be built on that upzoned land, that is its value. Its value cannot magically become 70% more.
The entire idea that there is some benefit to artificially installing poor people in wealthy neighborhoods is one that is high in ideology and low in fact. Economist Thomas Sowell that "expected benefits to newcomers from housing projects and high-crime neighborhoods have repeatedly failed to show up." Educational outcomes, economic outcomes, self-sufficiency - none of them change when low-income people are moved into high-income areas, according to numerous scholarly studies.
But it sounds nice, doesn't it? It sounds "fair."
It is anything but fair. It is neither fair nor just to reduce property values by government fiat. Those residents of R-1 neighborhoods worked very hard to be able to earn the money to purchase a home where they could enjoy coast weather, air, light, and, significantly, neighbors who also value their property because they had to work for it.
If they have any brains, and it stands to reason they do, they will be calling a real estate agent soon and moving somewhere else, somewhere that allows the free market, the method of allocation that is truly efficient and just, to determine neighborhood composition.
They will move to a city that will have sufficient water, schools, police, fire, commercial enterprises, and public budget - unlike Santa Monica in the future.