A Flawed Law: Reforming California's Housing Element

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Paavo Monkkonen
Michael Manville
Spike Friedman

May 2019

In both 2017 and 2018, the state legislature passed bills seeking to reform California’s Housing Element Law. More recently, Gov. Gavin Newsom indicated he intends to reform the law further, saying that the law as currently written enables a statewide approach to housing of “neglect and denial.” What is the Housing Element law, and why is it attracting so much attention? This issue brief introduces the law and highlights a sometimes misunderstood feature of its core planning tool: the Regional Housing Needs Assessment process. We focus in particular on how RHNA addresses the production of income-restricted, affordable housing. In doing so we emphasize a fundamental problem with RHNA: It creates needless tension between subsidized and market-rate housing, and as a result generates too little of either.

We suggest a solution that separates the goal of having cities carry a “fair share” of affordable housing from the goal of building enough housing to accommodate future growth. Specifically, we think the state should simplify its fair share requirement, and mandate that every city carry an equal percentage of income-restricted housing and make space for an equal rate of new housing growth.