Bay Area Takes Step Toward Major Housing Growth

A bureaucratic meeting of the Association of Bay Area Governments paves the way for S.F., Silicon Valley, and many exclusive suburbs to plan for...

It’s simple, really. As part of the sixth RHNA cycle, the HCD gave a housing allocation to the MTC, which worked with the HMC to create a growth blueprint for ABAG — and the newly-strengthened HAA means said housing could actually get built.

Sorry… Did we lose you there?

For all the non-housing wonks in the audience, here’s a translation: the cities and counties of the Bay Area must change their zoning laws to allow for the construction of 441,000 new homes between 2023 and 2031. A Thursday night vote by the Association of Bay Area Governments (ABAG) made that result all but certain, although there will be some continued debate about where in the Bay Area all of those homes should go. 

The Regional Housing Needs Allocation (RHNA), a recurring, bone-dry planning process, has quietly become the front line of the Bay Area’s housing wars. Its hyper-bureaucratic nature and its long time horizons, make it more difficult to understand than high-profile housing production efforts like Senator Scott Wiener’s SB 50, or the more modest housing production package that failed in the legislature last year. But over time, the RHNA process could be just as transformative as SB 50, thanks to a law Wiener shepherded through the legislature in 2018 with little fanfare. Far from being the “Sisyphus of housing legislation,” as he was recently described in CityLab, Wiener and his allies in the YIMBY movement are starting to look more like Zeus, raining policy lightning bolts on expensive coastal cities from their perch in the state capitol.

RHNA Grows Teeth

RHNA (pronounced ree-na), also known as the Housing Element, is the main lever the state government has to push cities to build enough housing to keep up with job and population growth. In eight-year cycles, the department of Housing and Community Development (HCD) allocates a certain number of homes to each major metropolitan area in California, organized into four affordability levels: very low income, low income, moderate income, and above moderate income. 

Each metropolitan area has their own planning organization — in the nine-county Bay Area, it’s the Association of Bay Area Governments (ABAG) working with planners from the Metropolitan Transportation Commission (MTC) — that distributes the state’s housing allocation among the cities and counties in the region. 

But this cycle was different, thanks to SB 828, the 2018 law Senator Wiener masterminded. The law beefs up the methodology used to determine each region’s housing allocation, accounting for previous under-production of housing, as well as areas where home prices are rising faster than wages, among other considerations. The result is that the upcoming cycle’s RHNA allocations are multiple times greater than the current cycle, which spans 2014-2022. The Southern California Association of Governments’ (SCAG) housing allocation more than tripled from about 400 thousand to about 1.3 million. ABAG’s allocation merely doubled, from 187,990 homes to 441,176. 

Of the Bay Area’s allocation, 26 percent of new homes must be for very low income households, 15 percent for low income, 17 percent for moderate income, and 42 percent for above moderate income. 

Plan Adopted

Since that allocation came down from the state in June, planners at the MTC have been working on distributing those planned new homes among cities and counties. In October, planners added an “equity adjustment” to the methodology intended to combat racial and economic segregation, combined with their existing mandate to plan for housing near jobs and transit. 

On Thursday, that plan was “adopted” by the ABAG board, which is led by Berkeley Mayor Jesse Arreguin, and includes elected officials from around the region, including San Francisco Supervisors Rafael Mandelman and Gordon Mar, by a vote of 29 to 1, with 3 abstentions. Before it is officially certified, the plan will be reviewed by the state, and individual cities will be allowed to appeal their allocations. 

So here’s what the latest, not quite final, RHNA maps look like:

Increase in households by city over the 2023-2031 RHNA cycle. (Photo: MTC)
Number of new units by city over the 2023-2031 RHNA cycle. (Photo: MTC)

San Francisco needs to plan for a 22 percent increase in households, or 82 thousand more units, between 2023 and 2031. That’s up from an allocation of about 29 thousand homes during the 2014-22 cycle. 

Other Bay Area cities slated to see significant household growth include Emeryville, Millbrae, Colma, Brisbane, Mountain View, Santa Clara, and Milpitas. However, the most dramatic changes could come in smaller, wealthier bedroom communities on the leafy fringes of major cities, many of them in Marin and Contra Costa counties. These communities were used to getting paltry RHNA allocations. Marin’s allocation of 14,285 is 21 times higher than the previous RHNA cycle. 

Not only were many wealthy, politically powerful suburbs able to get away with minuscule housing goals from the state (last cycle, Beverly Hills’ allocation was 46, this time around it’s over 3,000), cities frequently refused to provide permits for homes the state said they were required to produce. No longer.

In September, the state released a memo outlining the effect of several recent laws including Wiener’s SB 35 and East Bay’s Sen. Nancy Skinner’s SB 167, that strengthen the decades old Housing Accountability Act (HAA). These laws will make it much harder for city governments to reject housing projects that comply with zoning — zoning that must be changed to allow for the amount of housing set forth in each jurisdiction’s RHNA allocation. Legal watchdog groups like CaRLa and YIMBY Law have emerged to make sure that cities follow these laws. Governor Newsom’s most recent budget proposal includes $4.3 million for a Housing Accountability Unit to do much the same thing.

All that is to say that even though there is no guarantee that all 441,000 homes in this RHNA allocation will get built — they probably won’t — there are measures in place to ensure every city does its best to try. 

Affordability 

While RHNA receives little media attention, these changes have not been without controversy among those in the know. 

Many leaders and planners in suburbs that have seen virtually no new housing construction in decades are not thrilled about what lies ahead. In practice, abiding by RHNA will require cities to make zoning changes similar to those proposed by state laws like Wiener’s SB 50. Except this way, local officials, not Wiener, will be poised to take the heat from change-averse residents.

This is the case in San Francisco, too. Short of allowing a couple dozen Salesforce-tower sized apartment buildings, it’s hard to imagine how the city can meet its RHNA goals without upzoning single family areas. If the hoopla following Heather Knight’s latest Chronicle column on this exact issue is any indication, that will be a politically fraught process.

At the Thursday meeting, many voiced concern that these housing goals would be impossible to achieve in the allotted time frame. Mayor Pat Eklund of Novato, the sole ABAG board member to vote no, brought up a controversial study by the Embarcadero Institute that questions the RHNA methodology and suggests the state is asking the Bay Area to produce far more homes than it needs. Many urban planning academics dispute the Embarcadero Institute’s data. 

There are also concerns about the impacts that so much housing development could have on low income communities of color, especially in the Bay Area’s big cities. During public comment, Peter Papadopoulos with the Mission Economic Development Agency said, “This proposal will flood S.F. and other urban core communities with additional market rate housing burden, on top of preexisting harms already endured… This proposal currently doesn’t go past tinkering around the edges of equity and it will have grave harmful impacts if left unchanged.” (The Supervisors have the power to determine where new housing in the city is allowed to be built, whether in gentrifying or wealthy areas.)

San Francisco has historically met its RHNA goals for above moderate income housing production, while falling short in the other categories, especially moderate income, since there are more subsidies available for building low-income housing. However, the city’s RHNA goals in all income categories for the forthcoming cycle are now much higher. 

Fernando Martí of the Council of Community Housing Organizations, another group that has historically been skeptical of increased market rate development in San Francisco, struck a different tone. “It is not perfect,” Martí said of the RHNA housing allocations with the equity adjustment, but “this is a baseline to begin to support racial and social equity across the region.”

This piece has been updated to correct an inaccurate transcription of Peter Papadopouloscomment at the ABAG meeting, and an inaccurate description of how much greater the new RHNA allocations are compared to current allocations.

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