Four Interest Groups Contributed to the California Transit-Housing Bill's Defeat

As posted Wednesday, the controversial housing bill, SB 827 by Sen. Scott Wiener (D-San Francisco) and Sen. Nancy Skinner (D-Berkeley), died Tuesday, April 17 in the Senate Committee on Transportation and Housing, the bill's first hearing. It died on a 4-6-3 vote, well short of the seven votes needed to pass the 13-member committee.

"The only two yes votes from Democrats were from the bill’s authors, illustrating the disconnect between the bill’s progressive goals, and the demands of constituents from liberal (and often wealthy) areas," reports Benjamin Schneider for CityLab on April 18. The other two senators voting in support were Ted Gaines (R-El Dorado) and Mike Morrell (R-Rancho Cucamonga).

Deeper policy issues aside, CALmatters’ Matt Levin and the Los Angeles Times’ Liam Dillon explain in an emergency podcast of the "Gimme Shelter: The California Housing Crisis Pod," that raw politics may very well have prevented the other Democrats in the committee to vote for passage.

"As it works in Sacramento, you very rarely, if you are a regular committee member, want to do something that goes against the will of the chair of the committee," explains Dillon. And Sen. Jim Beall (D-San Jose), chair of the committee, was very much opposed. "Rolling the chair is a very rare event," adds Levin.

Dillon describes four critical interest groups that he believes led to the bill's defeat:

• Cities and counties, a powerful lobbying group, strongly opposed the bill because it would take away their land use authority. Much has been written about how the bill would preempt the local approval process. [See San Francisco Chronicle editorial below].

• Environmentalists: "The split that we ended up seeing between older-style environmental groups such as the Sierra Club," not inclined toward seeing building as a solution to environmental problems, were opposed and unlikely to be swayed, states Dillon. Other groups, like the Natural Resources Defense Council (NRDC), Climate Resolve, and Environment California that recognize the importance of building in transit areas, considered "good for the climate," came out in support. However, Levin questioned how much the split played into the bill's defeat.

• Labor: "The State Building & Construction Trades Council of California is a powerful interest group when it comes to housing in the state," notes Dillon. They were instrumental in killing Gov. Jerry Brown's by-right affordable housing bill two years ago, he adds, which Wiener himself acknowledged in his own statement (see below) on the bill's defeat.

"This may confuse people," interjects Dillon. "Why would construction unions not want speedy approvals of new projects?" he asks. How does discretionary review benefit organized labor?

Through the discretionary review process, Dillon explains, they can negotiate union-wage rules and union hiring standards. So even though SB 827 would greatly increase housing construction, that may not necessarily benefit union labor. 

"Cesar Diaz, a lobbyist for the powerful California Building and Trades Council [among Wiener's top donors], called the bill 'incomplete' and lacking provisions such as those that require contractors to pay the prevailing wage -- changes that could weaken the proposal's impact," reported the Contra Costa Times on March 3.

• The fourth group, the most interesting for Dillon, were equity advocates for low-income groups, tagged PHIMBYs for “Public Housing in My Backyard,” by CityLab's Schneider. Very few came to support the bill, but many came out opposed. Without their support, it was difficult for Wiener to claim that the bill would benefit the cause of affordable housing.

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The San Francisco Chronicle saw the bill's defeat as showing "a crisis of courage" in their editorial on Thursday.

[I]t wasn’t really the details of the bill that bothered [Wiener's] fellow lawmakers; it was the concept.

What distinguished and doomed Senate Bill 827 is that it would have overruled local officials’ use of planning, zoning and other barriers to block new housing, particularly high-density housing in existing neighborhoods, which they reliably do at the behest of incumbent residents. This local obstructionism is the essential ingredient of California’s multimillion-home shortage...

There will and should be more such efforts, but SB 827 demonstrated the depth and breadth of the state’s will to avoid its most pressing problem.

Yes, it will be a multi-year effort, wrote the bill's principal author, Scott Weiner, after its defeat.

I have always known there was a real possibility that SB 827 – like other difficult and impactful bills that have come before – was going to take more than one year. A good recent example is when Governor Jerry Brown, in 2016, proposed legislation to streamline housing approvals, a proposal that was deemed too aggressive by some and didn’t move forward that year.

But that proposal served as the foundation for the bill I proposed just a few months later – Senate Bill 35 – which streamlined housing approvals in California. SB 35 owes much of its success to the hard but important conversation that Governor Brown started when he pushed forward a bold housing solution.

That point, that "SB 827 has legs," and that Tuesday's defeat was a setback but not the end of the effort to "override local zoning power around transit stations," was reinforced by Bill Fulton in his April 20 blog in the California Planning & Development Report, "Is SB 827 Really Dead?"

Indeed, just two weeks ago, I told the assembled planning commissioners of California at a League of California Cities event in Monterey that they had to get ready because “something like” SB 827 was coming down the pike.

There will be a lot of post-mortems as to why [the bill died]. But the important question is: Will SB 827 – or something like it – be back next year? And if so, what are the odds of its success?

In his statement, Wiener indicates his next step, and reminds us that the bill was only one of his three-bill "Housing First" package:

Now, my job is to take the conversation started by SB 827, and get to work on developing a proposal that meets the ambitious goals of this bill, while incorporatin[g] what we have learned since we introduced it.

Of course, this setback doesn’t mean I’m done with housing for the year. I have additional housing bills this year to reform our Regional Housing Needs Assessment process (SB 828) and streamline the approvals of farmworker housing (SB 829).