Smart Growth Policy Concepts for the Bay Area

To: Bay Area State Legislative Delegation and

Governor's Office of Planning and Research

From: Select Bay Area Alliance for Sustainable Communities' Members and Participants

Date: July 1, 2003

For over 10 years the Bay Area has been struggling to come to grips with unacceptable and unsustainable growth patterns. As is common in other metropolitan regions in California, our job growth is outstripping our housing development, our cities and public transit systems depend on sales taxes and other unreliable sources of revenue, and our cities plan without incentive or need to consider the consequences in their neighboring jurisdictions.

Why the Status Quo is Harmful

The people who live and work in the Bay Area are experiencing a shrinking of opportunity, choice, and quality of life. Our planning and production of housing does not meet current or future demand. The undersupply of housing is leading to a series of serious problems: there is development pressure on eighty-three thousand acres of open space, and our regional housing market unaffordable to 87% of our residents. Further, our decentralized planning has led to a region-wide jobs-housing imbalance that, combined with a primarily low-density land use pattern, overloads our road system but enables only 6% of all trips to be made by public transit.

The Roots of the Problem

Our region’s future is at risk because we are failing to connect transportation and land use in everyday planning decisions. The State of California can help by addressing the following fundamental issues:

• Municipal revenue is unreliable. Limits on property tax, over-reliance on sales tax, and a general anti-tax political climate all contribute to cities’ challenges in raising revenue that would support infrastructure improvements and community amenities.

• Cities are forced to base land use planning decisions primarily on fiscal considerations. Big box retail brings sales taxes, low-density subdivisions bring higher-income households, and office parks bring jobs. Without a realignment of financial incentives, fiscal rewards will continue to drive land use decisions more than any other factor.

• Existing neighborhoods are unwilling to accept new housing. Infill and refill are the primary techniques used for compact development patterns, but without a complementary investment in infrastructure and amenities, communities react by opposing new development.

• The region has not planned for its projected housing growth. Local governments have not planned for the type and quantity of new housing necessary to meet our housing needs. As a result, the market searches for land far from where jobs are located and uses up more land for low density development, while failing to produce the number of units, particularly of affordable housing, that is needed to reduce overcrowding and inflated housing costs..

Smart Growth is a Viable Alternative

The Bay Area Alliance advocates a Smart Growth framework to address this web of issues. While the framework is broad and multi-pronged, the 2003 legislative session and Office of Planning and Research activities offer an opportunity to enact specific reforms that will make important strides toward Smart Growth for the Bay Area and other regions. To that end, members of the Bay Area Alliance have agreed upon the following set of policy concepts. Each concept and its strategy meet one philosophical condition and one strategic condition. Philosophically, the policy must have a positive impact on each of the three ‘Es’ – a prosperous economy, a quality environment, and social equity – of sustainability. Strategically, the policy must be limited in scope, so that it can only be used for the purposes of achieving Smart Growth.

Smart Growth Policy Concepts for the Bay Area

The following concepts are supported by equity, environment, and economy and government representatives in the Bay Area Alliance, and the attachment to this document further defines each one. Support by the representatives for these concepts should not be taken at this time as support for any particular legislation.

  1. Stabilize local revenue through fiscal reform. Providing local government a more stable funding base with a greater share of property tax and less reliance on the sales tax would encourage a better balance of retail and residential development, and support the community amenities necessary to make more compact residential development Fiscal reform should align revenue generation to local government responsibility to provide housing with services and amenities.
  2. Reward sound land use planning. The state’s adoption of higher standards for planning and building infrastructure can create new avenues for the public and private sectors to plan and build along Smart Growth principles.
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  3. Create incentives that complement infill and refill development. Local governments can develop compact infill housing if funds for infrastructure improvements and community amenities are more readily available.
  4. Lower the voter threshold for local tax and bond measures that finance balanced packages of Smart Growth infrastructure projects. Make it easier to develop revenue streams that jointly fund packages of Smart Growth infrastructure: transportation, housing, open space and recreation.
  5. Study current opportunities to streamline provisions in the California Environmental Quality Act and review construction defect litigation reform, and possible policy changes that could lead to an increase in infill housing production. The Bay Area Alliance wishes to see an overall increase in infill development, and state laws should enable, rather than hinder, that goal.
  6. Establish greater flexibility in planning K-12 schools. The $13 billion school bond approved by voters in November 2002 included $100 million for flexibility in planning and developing joint facilities. The Bay Area Alliance supports greater flexibility in design for schools in inner-ring and outer-ring communities, so that land and buildings can be used more efficiently.

Diverse Support for Smart Growth is Key

Smart Growth will only succeed in California by building broad support for step-by-step reforms. The above policy concepts have won support from economic, environmental, equity, and local government representatives within the Bay Area Alliance, and Bay Area Alliance members are prepared to work with Bay Area legislators and the Governor’s Office of Planning and Research to further detail these concepts through strategies, more specific policy language, and implementation programs.

 

 

 

 

 

The Broader Framework

The concepts in this memo are drawn from several years of dialogue and consensus-building among Bay Area Alliance members. The documents below contain the Bay Area Alliance’s broader framework for change:

• The Compact for a Sustainable Bay Area. The Bay Area Alliance’s leading document identifying key regional challenges and strategic recommendations to put the Bay Area on a more sustainable path. At www.bayareaalliance.org/compact.

• Smart Growth Strategy / Regional Livability Footprint Project. A regional public process led by the Bay Area’s five regional agencies, the Bay Area Alliance, and other stakeholders to build broader public consensus about a change in regional growth patterns. Final report at www.abag.ca.gov/planning/smartgrowth.

• Community Capital Investment Initiative. Private-sector investment funds for real estate development in low-income neighborhoods, aimed at reaping social, environmental, and economic benefits. Information at www.bayareacouncil.org

• Regional Sustainability Indicators. Measures of the region’s progress toward sustainability. At www.bayareaalliance.org/indicators.