Sacramento may ask voters to repeal a major constitutional roadblock to affordable housing.
The California State Senate’s Housing Committee voted unanimously on June 4th to approve Senate Constitutional Amendment 1 by State Senator Ben Allen (D-Santa Monica), which would repeal Article 34 of the state constitution. Article 34, which mandates a local ballot referendum to approve any affordable housing project subsidized mostly by public funds, has been a been a major driver of racial and class segregation since its passage in 1950, and inflates the cost of providing subsidized housing at a time when most Californians are struggling with soaring housing costs. SCA-1 now moves on to the full Senate.
The bill would bring a repeal of Article 34 to the 2020 state ballot—the fourth attempt since 1974. SCA-1 enjoys a broad base of support from interest groups that have otherwise been on opposing sides of hot-button housing bills during the state legislature’s contentious session. The California Association of Realtors joined the AIDS Healthcare Foundation and the Western Center of Law and Poverty in support, despite bitterly opposing just-cause eviction protections and rent control policies the latter groups endorsed. Notably, though the California Association of Realtors led the 1950 initiative that brought about Article 34, it has reversed that position and supported its repeal since 1992.
“Everyone knows that California has a major affordable housing problem that is affecting business and job attraction and retention in the state,” read a May 11, 1992 memorandum in support of the precursor to Allen’s bill, SCA-17, by the Realtors Association, the League of California Cities, and various business groups. “Rather than automatically requiring an election, SCA-17 puts the burden on NIMBYs and opponents of affordable housing by making them collect signatures on a petition to force a vote on new development.”
Article 34, passed in 1950 as Proposition 10, emerged from a coalition of real estate groups and homeowners in Oakland who successfully recalled a city councilmember the previous year and thwarted plans to build 3,000 public housing units throughout the city. Unsatisfied by a citywide victory, and joining forces with opponents of a low-income housing project in Eureka, they took their campaign successfully to the state level, as chronicled in a recent Beacon investigation.
In 1971, the U.S. Supreme Court upheld Article 34 in James v. Valtierra, dismissing a lawsuit on the grounds that it “ensures democratic decisionmaking, and does not violate the Equal Protection Clause [of the Constitution].” The majority decision further concluded: “a lawmaking procedure that ‘disadvantages’ a particular group does not always deny equal protection.”
According to historian Aaron Cavin, the decision “advanced a colorblind defense of class privilege in suburban America, reinforcing the belief that racial discrimination was wrong while class discrimination was not merely constitutionally acceptable but undoubtedly right.”
Constitutionality aside, the evidence has shown major disadvantages exacerbated by Article 34 on lower-income communities suffering the most under the state’s critical housing shortage.
“California has an estimated twenty-two affordable and available rental homes for every one hundred extremely low-income households,” Senator Allen said. “Article 34 stands as an additional, anachronistic and expensive Constitutional barrier that subjects local governments to a web of regulations and costly elections that end up driving up the price of building publicly financed affordable housing.”
Sen. Scott Wiener (D-San Francisco), a co-author of the bill, estimated that Article 34 compliance costs affordable housing developers between 1% to 15% of the total cost of each unit built.
Critically, support for the repeal of Article 34 has united groups that otherwise disagree on efforts to increase urban densities to construct more private market-rate housing. Mayor Eric Garcetti, who has opposed previous proposals by Wiener to increase density near transit but remained neutral on this year’s Senate Bill 50, co-sponsored SCA-1 and offered full-throated support. “Article 34 inflicts unnecessary and costly burdens on cities, delaying the construction of housing in the communities we need it most,” Garcetti said in a statement.
With a recent 2019 homeless count for the Greater Los Angeles region showing a staggering 12% increase in the homeless population, groups across the political spectrum banded together to tackle the archaic, classist and racist hurdle to publicly subsidized housing. For example, the Western Center for Law and Poverty also opposed Wiener’s previous bill and was neutral on SB 50 this year, but joined the unusual coalition supporting the Article 34 repeal.
“In a state like California, that purports to value diversity and inclusion, having an article in the constitution that openly allows voters to choose to discriminate is unacceptable, and it’s time for it to go,” said Anya Lawler, chief lobbyist for the Western Center, at the Housing Committee hearing.
“Article 34 was a wrong, unjust law put in place decades ago to discriminate against people of color and lower income people,” said Amie Fishman, Executive Director of the Non-Profit Housing Association of Northern California (NPH)—in contrast, a co-sponsor of SB50. “We are thrilled that the Senate took this important passing vote to remove housing discrimination from our State Constitution by repealing the unjust Article 34.”
SCA-1 is unusual in uniting the California Realtors Association, the City of Los Angeles, and nonprofits such as the Western Center and NPH lobbying for the interests of low-income tenants. Notably, the Realtors opposed tenant protections that were either watered down or dismissed by the State Assembly in previous weeks. But it’s not the only instance of this temporary alliance.
California YIMBY, a co-sponsor of Wiener’s controversial SB 50 along with the Non-Profit Housing Association of Northern California, was among the only interest groups to support that bill along with just-cause eviction protections and anti-gouging rent cap legislation, which the California Association of Realtors strongly opposed. But on SB50, they found themselves on the same side as the Realtors, opposed by nonprofits such as the AIDS Healthcare Foundation and various tenant unions. Repealing Article 34 is a rare instance of common ground that California YIMBY says provides fruitful ground for future activism.
“California YIMBY is focused on solving the housing crisis for all Californians,” said Matthew Lewis, spokesperson for California YIMBY. “That includes people experiencing homelessness, teachers who earn too much to qualify for Below Market-Rate housing, and for everyone in between. The notion that we should make it legal to build public housing in cities is a no-brainer for us.”
Lewis added that the logic behind California YIMBY’s support for repealing Article 34 and building subsidized affordable housing was the same behind its support for market-rate housing. “We should of course build market-rate housing for people who make less than a million dollars a year but are in good jobs—such as teachers, such as nurses, those people deserve housing too,” Lewis said. “So we are supporting all these measures to ensure that California really is for everyone. We really mean it. We don’t care more or less about human beings because of the amount of money they make.”