SFBARF is getting a lot of press for a theory — build and build and build and housing prices will come down — that doesn’t stand up to the facts

SFBARF's Sonia Trauss: Build and build and build and hope (against all evidence) that prices will come down.
SFBARF’s Sonja Trauss: Build and build and build and hope (against all evidence) that prices will come down.

By Zelda Bronstein

FEBRUARY 9, 2015 – Last Monday evening, a new organization with a highrise, pro-growth agenda and a memorable acronym — the San Francisco Bay Area Renters Federation — held a forum at The Lab, a block from the 16th St. BART station. The topic was “The Political Situation: How did housing prices get so high? What can we do about it?”

SFBARF is getting a lot of positive press, in part because the group’s message perpetuates a seductive illusion: The lack of affordable housing is all about a lack of construction.

Here’s how SFBARF describes its mission:

“The cause of our current housing shortage isn’t technological – we know how to build. It’s not financial – investors are clamoring to invest in the Bay Area. It’s not the result of a raw material shortage — unlike the 1940-45 housing crisis when the war effort diverted labor and materials from private efforts, today we have all the laborers and materials we need.

The cause of our current shortage is 100% political.”

The group has one solution: Build and build and build. And hopeagainst all available evidence – that eventually prices for renters will come down.

Advertised as SFBARF’s “first panel discussion,” Monday’s event featured three speakers—Roger Valdez, director of Smart Growth Seattle; Kate Downing, co-founder of Palo Alto Forward; and Michael Cohen, former head of the Real Estate and then the Public Finance Group in the San Francisco City Attorney’s office and director of Gavin Newsom’s Office of Economic and Workforce Development, now a principal at Strada Investment Group.

TechCrunch writer Kim-Mai Cutler moderated.

The crowd of 100-plus attendees mostly comprised young white men, along with a smattering of young women and a few éminences grises such as Tim Colen, Executive Director of the San Francisco Housing Action Coalition, and Mary Jung, a lobbyist for the Board of Realtors and chair of the San Francisco County Democratic Central Committee.

From the start, it was clear that the chief purpose of the event was political mobilization. Speaking first, SFBART founder Sonja Trauss issued a call to action. “What’s different about this political club,” said Trauss, is that “the focus is on neighborhood participation….Where this stuff [big new residential projects] gets blocked is at the small neighborhood meetings about pre-applications.” She urged her listeners to start paying close attention to their neighborhoods. “When you see a hearing notice, take a picture and send it to the [SFBARF] list.”

She asked everyone to look at the mini-leaflet that had been placed on each chair. Its headline read: “Have you ever waited for hours at a public hearing?” According to Trauss, videos of the Planning Commission’s meetings going back to 2006 show that the average wait time for citizens hoping to address that body is one hour and 52 minutes—an excessive duration, she contended, that could be shrunk. Indeed, the Planning Commission process can be hard on anyone who has a day job and wants to speak.

Trauss urged people to attend the Sunshine Ordinance Task Force’s February 17 meeting and to say that the Planning Commission needs to schedule each item at a particular time, adding that she didn’t really expect the commission to do so, but that it was important to show up and speak out.

The need to “change the conversation” around land use in the city was reiterated throughout the evening. In that regard, Trauss struck another resonant theme: the legitimacy of pro-development advocacy, especially when the advocates are new to San Francisco. “Don’t let anyone tell you that you don’t have standing because you haven’t lived here long enough,” she insisted. “You have standing!”

That counsel was echoed by Kate Downing. Palo Alto, Downing observed, is “more small townish” than San Francisco. But it shares the big city’s political character in that until now, public discourse about development has been dominated by people who are over 60, retired, and independently wealthy, and who thus “have the luxury of time to go to meetings.” They’re also people who oppose new housing in the city, which, Downing told me in a Tuesday email, has the biggest job-housing imbalance in the country.

Downing said that through community outreach, Palo Alto Forward had succeeded in publicizing a “counter-narrative” that for the first time brought young people to council meetings dealing with the city’s comprehensive plan.

She also made recommendations about political effectiveness. “You have to give local government face time. Writing things online and posting comments on Facebook are thing we do, but they “don’t actually move anything with government.” Elected officials need to be able to “put names to faces.” Get to know them. (Sound advice.)

Michael Cohen focused on San Francisco, where he works and lives. He said Strada has 850 units in the city under construction or in the planning pipeline.

Mindful of Cohen’s extensive resumé, Cutler asked him if the political climate around development has changed.

Cohen replied by citing a “consistent quandary”:

“We’re very progressive” about culture and lifestyle, but when it comes to the “physical environment,” we’re “spectacularly conservative. We want to be La Jolla or Aspen”—in other words, expensive, gated communities—but “you can’t say that. It has to be wrapped in something else,” namely “progressivism.”

In his view, “the single most important land use debate is whether you believe the laws of supply and demand exist”—an allusion to veteran affordable housing advocate Calvin Welch’s contention that those “laws” don’t apply to San Francisco, a built-out city at the tip of a small peninsula that’s experiencing an apparently infinite demand for housing.

Cohen offered Market-Octavia as an example of major development that preserved neighborhood character. With maximum heights raised to 85 feet, the area has recently gained a thousand new units, “but it feels the same.” “Geary,” he opined, “could handle 85-foot heights.”

Cohen also said that he’s “a huge supporter of the non-profit housing community,” which is “under-funded” and “under-supplied with land” and a fan of inclusionary housing.

The third panelist, Roger Valdez, was the wild man of the group. Valdez described Smart Growth Seattle as a “pro-growth, pro-supply, pro-choice housing organization” that’s funded mostly by developers. He said he’s a former non-profit housing developer who used to work in Seattle’s Office of Neighborhoods.

Valdez dismissed the idea that “the more we build, the more expensive we get,” dubbing it “the Galileo problem”—that is, a refusal to acknowledge empirical reality. In the past decade, he said, Seattle rents have risen only 5%.

The city’s laws allow you to “build up to the envelope.” Though there are “no hooks for community benefits,” there are “a couple of traps”—specifically, the State Environmental Protection Act and the right to appeal approvals of permits. Both allow neighbors to “throw a monkey wrench into what they don’t like.”

He deplored Seattle progressives and “Birkenstock-wearing socialists” who own single-family homes and are “all for Obama’s immigration” but raise their “pitchforks” when proposals for micro-housing are put forward. Their “deep fear of change” leads them to complain that buildings are too tall and lack sufficient parking. He called “zoning” itself “the problem,” contending that it’s an anachronism left over from the twentieth century, devised to separate industrial and residential uses. Drawing on economic orthodoxy — some would say mythology — he assured us we can dispense with zoning because “the market is going to find the equilibrium.”

Valdez also denounced “the social justice beast,” with its demands that “everything has to be equity-focused.” To hear him talk, that creature is currently raging in Seattle, where, he said, all nine councilmembers are up for re-election, and “everyone is trying to out-socialist our socialist [councilmember],” resulting in a “paralyzed” council.

I found Valdez delightful. Not for him the bromides about affordable housing issued by most smart growth proponents. He didn’t even trot out the customary environmental rationales about reducing VMT (Vehicle Miles Traveled) or saving the planet from global warming. Here was the naked truth about the dominant paradigm in U.S. city planning: its fundamental goal is growth, period. Thank you.

Valdez seems to have a bit of a Galileo problem himself.

John Fox, who heads the Seattle Displacement Coalition, has been following the numbers for years. Writing with Carolee Colter, Fox observes that

For the last 35 years, since Seattle came out of its mid-1970s economic bust, periods of accelerated residential development have always directly coincided with more demolition of low-income housing, higher rents, lower vacancy rates, longer waiting lists for subsidized housing, increasing levels of homelessness and higher housing costs for all Seattleites. Each successive wave of growth leaves in its wake a growing divide between rich and poor, white and non-white in our city.

So how does the simple economic maxim of “more supply lowers prices” get turned completely on its ear? In a built-up urban environment, there’s less and less vacant land over time, and the consequence of new development means removal of the existing supply of lower-density housing. Housing that’s older, non-debt-supported and affordable gives way to new, more expensive housing.

Last September, the Seattle Times reported that between 2010 and 2013 alone, rents spiked by nearly 11%–information that doesn’t jibe with Valdez’s claim that they’ve gone up only 5% in the last decade.

All along Kim-Mai Cutler ably moderated in two senses of the word: she kept the conversation lively and on track; and she tempered some immoderate claims.

After Valdez excoriated the “social equity beast,” Cutler marked the “vast” income inequality in the Bay Area and said that “in a market so hot,” inclusionary housing “doesn’t kill development.”

In contrast to Cohen, who said he “wouldn’t touch Airbnb with a 10-foot pole,” Cutler suggested to the audience—most of whom had raised their hands when they were asked how many present were tenants—“as a renter you might find that the short-term rental situation regulation is insufficient.” Her point being that the new law allowing any residence in the city to be rented out to temporary tenants all year long is going to diminish the number of units available to long-term occupants.

And when one questioner referred to the “psuedo-economics” of Welch and former Planning Commission Chair Doug Engmann, and claimed that they are “never challenged by people in the media,” Cutler said, “I take a more nuanced view….It’s not that anyone’s stupid.” Different positions “might make sense in terms of self-interest”—for example, when nonprofits argue for a higher allocation for affordable housing, “even if some of their arguments seem pretty ideological.”

That closing caveat, however, hints at the limits of Cutler’s own judiciousness. The implication is that SFBARF position, which she shares—that we can build our way out of the affordable housing crisis—is not ideological but value-free and politically agnostic.

Certainly it was easy to get that impression at the Lab on Monday evening, because nobody asked the really hard questions.

Where, for example, is the evidence that broad affordability can be achieved in any way other than building genuinely affordable, i.e., way-below-market-rate, housing?

How many new units would it take to house everyone who wants to live in San Francisco?

Wouldn’t that number change the city’s character in a way that, debatably (I’m thinking of the backup of cars coming off the freeway onto Octavia), 1,000 new units haven’t changed the feeling of the Market and Octavia neighborhood? To be precise, wouldn’t all those new units further diminish the qualities that have made the place special? And isn’t that a problem? If not, why not?

And to cite an argument Cutler has made in print, why does everyone who lives in the Bay Area today need to accept responsibility for making changes where they live so that everyone who wants to be here, can, especially at a time when environmental pressures—starting with too much and too little water—are increasing and, it seems, unavoidable?

Sonja Trauss: how about putting those questions front and center of SFBARF’s second panel discussion?