Tag: nn-feature-apr-2019

Frank So, FAICP, 81; helped create Planning magazine

Frank So, FAICP, 81; helped create Planning magazine

IN MEMORIAM

APA has informed us of the death of its retired APA Executive Director Frank S. So on February 22, 2019.

So graduated from Youngstown University and earned his master’s degree in city and regional planning from Ohio State University. He joined the staff of the American Society of Planning Officials in 1967, and spent more than 30 years with the association that eventually became APA. He worked in the growing research program, where he helped create Planning magazine and started the Planners Press book publishing program. So served as executive director of APA and AICP from 1996 to 2001.

So is remembered for his work overseeing the publication of more than 60 books on planning, and for editing four planning textbooks, including the Practice of Local Government Planning. This ICMA “Green Book” text has since been used as an introduction to the field for several generations of planning students.

So lived in Flossmoor, a suburb 45 minutes south by commuter rail from the ASPO offices on the University of Chicago campus. He also served for 16 years as a consulting advisor to the Village of Flossmoor: village manager, planning director, board of trustees, planning commission, appearance commission, and the zoning board of appeals. He was an adjunct professor at Governors State University and a volunteer planning career advisor to the Peace Corps.

Marking history with the Ohlone-Portolá Heritage Trail project

Marking history with the Ohlone-Portolá Heritage Trail project

Samuel Herzberg, AICP.

TWO HUNDRED AND FIFTY YEARS AGO, an expedition led by Gaspar de Portolá travelled 1,200 miles up the Alta California coast to explore an overland route for establishing Spanish harbors at San Diego and Monterey Bay. Following well-established footpaths that marked trade routes between native villages, the expedition traveled farther north, and its members became the first Europeans to see the San Francisco Bay.

Portolá himself, Father Juan Crespi, and Miguel Constansó — the party’s engineer — chronicled the expedition. According to surviving journals, the expedition did not recognize Monterey Bay from Spanish explorer Sebastián Vizcaíno’s 167-year-old description and so continued north, in search of a suitable harbor. As the expedition entered what is now San Mateo County near Año Nuevo State Park, they were welcomed by the Quiroste people at one of the larger villages along the coast.

The Quiroste provided much-needed nourishment to Portolá’s men, reviving the scurvy-ridden soldiers, and told them of two harbors about three days’ walk north. Their guides led the Portolá party to neighboring villages at San Gregorio, Tunitas Creek, and Half Moon Bay. At Montara Mountain, Costansó recognized the farallones to the west, — a group of islands 20 miles outside the Golden Gate and a known landmark even in those times — and realized they had passed Monterey Bay. Atop the mountain, they met a group of about 25 Aramai, who may have been from the village of Pruristac in Pacifica where the Sanchez Adobe now stands.

As the party camped nearby in San Pedro Valley, a small group went up the hills to hunt deer. They came back after nightfall describing a giant estuary surrounded by smoke from the fires of native villages. These hunters became the first recorded Europeans to see what we now call San Francisco Bay, most likely from somewhere atop what is now known as Sweeney Ridge. November 4 will mark the 250th anniversary of this historic and unexpected experience.

The Expedition continued south through the Crystal Springs Watershed towards Woodside, and then east, ending at the north (Menlo Park) side of San Francisquito Creek. The Menlo Park camp was adjacent to the El Palo Alto tree from which the city of Palo Alto takes its name. At the end of their route, the party followed their path back through San Mateo County and along the California coast, returning to Baja California and then to Spain to report on their findings.

HISTORIANS ESTIMATE that indigenous people have lived for approximately 10,000 years in what is today San Mateo County. Natives — the Ramaytush Ohlone, who shared a dialect — numbered more than 2,000 in the area in 1769. They were generally organized in territories bounded by watersheds, with small groups living in villages spaced three to five miles apart along the creeks and valley. The subsistence and material culture of the Ramaytush Ohlone did not differ from other neighboring Ohlone societies. (“Ohlone” encompasses 50 Bay Area tribes that had a common root language.)

Local Ohlone culture was cosmopolitan, much as the San Francisco Bay Area is today. The Ohlone harvested plant, fish, and animal resources from the environment and acquired additional resources through extensive trade networks, including some that extended across the San Francisco Bay to the north and east.

At the time of the Portolá Expedition, California had the densest population of indigenous people north of Mexico: More than 300,000 lived here — more than all the Indians of the Great Plains — with the largest concentrations in the Sacramento Delta, the Santa Barbara area, and the San Francisco Bay Area.

With Measure K funding — a countywide half-cent sales tax extension passed by county voters in November 2016 — the San Mateo County Parks Department prepared a feasibility study for a 90-mile interpretive, multi-use, recreational trail (and a future auto route) through the county to commemorate native and Portolá history and honor the region’s native culture. The trail will follow Native American villages, the adjacent Portola Expedition camps, and the trade routes connecting villages. It will be the first trail to connect the coast to the Bay.

Credit: San Mateo County Parks, Draft 1/20/19

Utilizing existing regional alignments, the trail route is already half complete; it needs to be signed. Future sections will largely use public lands of San Mateo County Parks, Peninsula Open Space Trust, CalTrans, Midpeninsula Regional Open Space District, State Parks, San Francisco Public Utilities Commission, and the Golden Gate Recreation Area. Interpretive signage will tell the story of the indigenous Ohlone culture, the Portolá Expedition’s 27 days in San Mateo County in 1769, and U.S. West Coast history.

All of the Portolá Expedition camps are already designated State Historic Landmarks. The Ohlone-Portolá Heritage Trail connects them. The San Mateo County Historical Association is nominating the trail to the State Office of Historic Preservation as a State Historic Trail. The County has funded a documentary film that will screen at a new Interpretive Center at the Sanchez Adobe. Both will open in Pacifica October 26, 2019.

Seven years after the Portolá Expedition, the Juan Bautista De Anza Expedition led to the missions being developed in California. The Juan Bautista De Anza Trail is a designated National Historic Trail.

You can see the Ohlone-Portolá Trail Feasibility Study on the San Mateo County Parks Department web page.
Samuel (Sam) Herzberg AICP, holds a master in urban planning from San Jose State University and a B.A. in geography from San Francisco State University. For 20 years, he has been a member of APA and an employee of the San Mateo County Parks Department, where he is a senior planner. Herzberg is a member of the Indicators Committee of Sustainable San Mateo County, where he helps oversee and manage quarterly updates of indicators.

How much house is too much?
Credit: City of San Carlos

How much house is too much?

By Al Savay, AICP.

RETHINKING SINGLE FAMILY HOUSE SIZE.

The single-family detached house is an icon — a symbol of the American Dream. Owning a single-family home is the culmination of hard work, financial planning, risk, strategic thinking, and sacrifice.

Demographic changes have revealed major shifts in how our country views home ownership. Even so, middle-class or millennial, many still plan their lives around owning a single-family home. If we are fortunate enough to make it into the ownership circle, we inevitably develop very strong feelings about what our neighborhood should look and feel like, and what’s appropriate in terms of house size and scale. We’re likely to decide that the neighborhood should stay the same as when we bought there, and that our neighbors should also resist change.

American cities have embraced the notion of the suburban neighborhood as an inviolable place by adopting building and lot standards to ensure a distinct scale, proportion, and character. Thousands of public-sector planners started their careers at the zoning counter, reviewing additions and “remodels” of single-family homes against those standards. Any planner who has worked the zoning counter knows that getting in the way of owners who want to add to, or rebuild, their houses is a recipe for high blood pressure for both parties.

This is the story of one city’s assessment of what is fair and appropriate in terms of single-family house size and scale.

The setting

San Carlos is a city of 30,000 in southeastern San Mateo County, with 8,000 properties zoned for single-family residences.

As the fortunes of Silicon Valley led to high-paying jobs, stock options, and bonuses, our community became a very desirable place because of its central Bay Area location, sense of community, and top-performing schools. An influx of young, two-income households have come to raise their families in San Carlos. Much of the single-family housing stock had not been touched since the 1950s.

These new buyers began hiring local architects, designers, and contractors who relayed to city staff that the first question from their clients was, “How much house can I build?” Their needs and desires differ from those of long-time residents. In addition to a minimum of three bedrooms and two baths — or even more for multi-generational families — they want higher ceilings, mudrooms, open floor plans with combined kitchen and family rooms, media rooms, and an office or two. All of this led to larger, taller houses, many of them on the original, small, narrow lots next to smaller, one-story homes.

The planner’s task in leading a change in how much house one can build is fraught with challenges. This is where zoning directly intersects with “home,” the most fundamental and personal space in the American psyche. There can be no straightforward answers or recommendations from city officials, no matter how well thought out. No matter how empathetic, the proposals are sure to meet with criticism and scorn.

In 2016, the San Carlos City Council held study sessions in response to community concerns about the size of new homes and additions. Community members complained about a proliferation of “monster homes” and “McMansions” that compromised their light, solar access, air and privacy, particularly on blocks where most homes were single-story. To some, these larger homes were unnecessary. Hadn’t they successfully raised their families in much smaller houses? Others complained their privacy was being eliminated by the second stories that loomed over their backyards.

The city council directed its planners to study these complaints and recommend changes to single-family house-size standards. A Community Coalition formed around the issue and began presenting ideas on how to solve the problem, positing Floor Area Ratio and Daylight Plane as solutions.

To democratize the process, the planners recommended that the council appoint a citizens advisory committee of local stakeholders to work collaboratively with city staff and an urban design consultant. A seven member Citizens Advisory Committee — four single-family property owners, a local builder/developer, a local architect, and local residential realtor — were appointed to evaluate, guide, and recommend new standards.

Discovery and idea phase

We started the process with ideas for successful outcomes:

  • How can zoning standards and design address negative impacts from “inappropriate” house size?
  • What are some directions and options for better massing?
  • Is it possible to develop a more consistent overall design, look, and feel?
  • Can a context-sensitive approach to the site and its surrounding homes be considered?
  • How can misunderstandings between neighbors about house size be addressed?

We reviewed the existing code, evaluated building forms, geography and topography, permit data, and peer city standards. These issues emerged:

  • The city did not have a Floor Area Ratio (FAR) — the ratio of the total floor area of a building to its lot area. Most peer cities used FAR as the primary limiting factor for house size.
  • Our existing standards allowed too much bulk at the front and sides of the house.
  • Upper floor setbacks were somewhat ineffective in reducing upper floor mass.
  • Our front and rear setbacks resulted in very long houses.
  • Two-car garages dominated about 65 percent of the house front, accentuating the bulky appearance from the street and making living areas and entries secondary.
  • The majority of the single-family lots in San Carlos were relatively narrower and smaller than in neighboring cities.
Credit: City of San Carlos

A Form Based approach

We found no single solution to address house size and bulk. Floor Area Ratio seemed like a logical limiting factor, a “no brainer.” FAR reduces overall square footage, but it does not address either the overall physical form of a house or how it looks in the context of other homes on a given block. And FAR appears not to reduce the apparent size of a home where it counts — along the street frontage, or at the rear as seen from a neighbor’s backyard.

Many communities have crafted regulations that fit with the character of their neighborhoods. Very few Bay Area cities apply a Form Based approach to single-family homes. Those that do are satisfied with the results.

In 2017, the Citizens Advisory Committee held six public meetings with city staff and the consultant. The committee focused on which features of a home’s design make them look large or out of scale, and which features seem to work.

The committee reviewed various approaches, including FAR, to reduce house bulk and mass, and discussed how to manage house size and scale in the context of surrounding homes. It became clear that a set of coordinated design solutions would be needed to effectively address the physical form of the house and reduce its apparent bulk and mass.

Key ideas

To address the issues identified by the community, while not unfairly penalizing those who want to add floor area, the Citizens Advisory Committee recommended a Form Based approach with no FAR limit. For controlling bulk and mass and respecting neighborhood context, FAR was seen as an arbitrary standard and less effective than the Form Based concept. In general, building appearance, scale, and massing could be mitigated more successfully by controlling the structure’s width and depth. This would produce a house form that more closely mirrors existing houses, especially with respect to scale and backyard privacy. And it would reduce overall floor area by 30 percent compared to our existing standards.

FORM BASED CONCEPT, MAIN BODY AND WING DESIGN. 3D-printed models helped tell the story of how Form Based design standards work. Here house bulk and mass under existing zoning (gray) are compared to a Form Based approach (orange). Credit: City of San Carlos

 

The recommended Form Based standards included:

  • New controls over main building size and bulk
  • Allowing wings to be added to the main body to gain square footage
  • Incentives for garages placed in the middle and rear of the lot
  • Greater rear-yard and upper-floor setbacks
  • A sliding scale for lot coverage based on lot width
  • One covered parking space and one car uncovered space in driveways on lots less than 60 feet wide
  • Improved procedures, definitions and design review criteria
  • The ideas were then presented to the community, local architects, and designers, and at several Planning Commission study sessions.
Massing allowed under existing zoning. Credit: Opticos
Massing allowed under Form Based regulations. Credit: Opticos

Here is a summary of what we heard back:

  • The proposed standards don’t go far enough
  • The process is moving too quickly/too slowly
  • New standards should match those of other cities; these ideas do not limit square footage as much as some other cities do
  • The ideas don’t protect a neighbor’s light, views, and privacy
  • Local architects believe the recommendations won’t reduce house size
  • Use FAR limits in line with what peer cities use
  • Establish a 50 percent lot coverage and require a solar study

Sometimes you need to pivot

At about the same time the public meetings were taking place, a number of other significant issues arose: Three of five planning commissioners termed out, and three of five city council members would change seats in a few months’ time. The sitting city council had been extensively engaged in the process and had a strong grasp of the issues and the recommended solutions. Getting a newly elected city council up to speed on the complexities of the code changes was not ideal. The process had already taken 18 months, and pressure was building to wrap it up.

Planning staff went to work educating new commissioners about Citizens Advisory Committee recommendations and options and community concerns. Over the course of several planning commission hearings, the merit of the Form Based ideas was acknowledged. But there was very little community support and the Community Coalition demanded a deeper reduction in square footage than the 30 percent the Form Based approach would achieve. As the time for city council turnover approached, the commission was at an impasse and asked for other solutions including FAR based standards.

Planning staff delivered several FAR options with a mix of some Form Based components that seemed to have planning commission support. Following a late night hearing, one commissioner approached me and said, “Just when I think we’ve hit a wall, you always seem to find us a way out.”

Where we ended up

After our in-depth consideration of the Form Based approach, it was clear to us, the city planners, that it was a superior solution that addressed community issues by reducing the size, massing, and appearance of new homes and additions. That said, we are not the decision makers, and our duty as facilitators takes precedence. That led to what we believe will be an effective solution to the house-size issue in our community.

The planning commission recommended a robust set of code changes a month or two before the new city council was seated. In November 2018, the Council refined the Commission’s recommendations and adopted a new set of rules combining a sliding scale maximum FAR with some of the Form Based ideas.

More recently, the Community Coalition asked the new city council to revisit the recently adopted standards. In their view, the new standards do not go far enough.

Albert Savay, AICP, is the Community & Economic Development Director of the City of San Carlos. He is Chair of the Bay Area Planning Directors Association (BAPDA) and sits on the ABAG Regional Planning Committee. You can reach him at asavay@cityofsancarlos.org

California launches program to increase housing production

California launches program to increase housing production

By Jennifer Gastelum and Charlie Knox, AICP.

IN AN EFFORT TO ADDRESS THE STATEWIDE HOUSING SHORTFALL, the California Department of Housing and Community Development (HCD) has begun the process of making money available to every city and county in California to expedite housing construction.

Senate Bill 2, the “Building Homes and Jobs Act,” was signed into law by then-Governor Jerry Brown in September 2017. The law, which imposes a $75 fee on most real estate transactions in California, is expected to generate about $250 million annually to increase housing, and especially affordable housing, across the state.

According to HCD research, statewide housing production has averaged below 80,000 new homes per year since 2010, compared to an annual need of about 260,000 new homes. This disparity has led to increasingly high housing costs and has forced people to locate in communities without sufficient job opportunities, leading to unprecedentedly long commutes and associated negative environmental and quality of life impacts for millions of Californians. Additionally, the state is experiencing the lowest rate of home ownership in 70 years, and renters are often paying half or more of their income on rent.

While the housing shortfall affects all income levels, it disproportionally impacts low-income households, disadvantaged communities, and people with special needs. The cost of housing in California has contributed significantly to the state’s homeless population, which accounts for 22 percent of all homeless Americans, despite California having only 12 percent of the country’s population.

In order to implement SB 2, HCD has selected a team of consultants led by California-based PlaceWorks to help jurisdictions identify projects and tools that will help increase housing development, including for lower income households, families, and people with special needs.

The HCD/PlaceWorks team is currently in the process of developing a Geographic Information System database to compile data about each jurisdiction, including ideas for potential projects for the grant funding, and timing and requirements for grant submittals. Cities and counties with a State-certified Housing Element and a completed 2017 or 2018 Annual Progress Report are eligible to receive SB 2 funds for a range of projects, including:

  • Targeted General Plan Updates
  • Community Plans and Specific Plans
  • Zoning Updates and By-Right Zoning for Housing
  • Objective Design Standards
  • Accessory Dwelling Unit Regulations
  • Streamlined Environmental Analyses
  • Process Updates to Improve and Expedite Local Permitting

During this first year of the “Senate Bill 2 Planning Technical Assistance Project,” approximately $125 million will be available for Cities and Counties to update their planning rules and processes to streamline housing production, in amounts based on a jurisdiction’s population:

  • Less than 60,000 residents – $160,000
  • 60,000 to 200,000 residents – $310,000
  • More than 200,000 residents – $625,000

The grant application form is currently being finalized and submittals will be accepted for the first round of funding through December 31, 2019. Interested city and county representatives should contact Jennifer Gastelum at JGastelum@PlaceWorks.com.

Jennifer Gastelum is an associate principal at the PlaceWorks Sacramento Region office in Folsom, California, where she heads up the company’s housing assistance practice.

Charlie Knox, AICP, is a principal for comprehensive planning at the PlaceWorks Berkeley office.

A disruptive housing technology
At Factory OS. Inside a finished living and kitchen space of a modular unit.

A disruptive housing technology

The story of Mare Island, a Base reuse, and Factory OS

By Afshan Hamid, AICP.

A HOUSING AND TECHNOLOGY DISRUPTION is occurring on Mare Island in Vallejo, California. For 142 years, the island functioned as a naval shipyard for 40,000 workers and more than 500 ships, including cruisers and battleships that served in several wars, including two World Wars. The USS Saginaw, a four-gun, wooden-hulled, steam-driven, side-paddle-wheel gunboat was launched from Mare Island on March 3, 1859. The shipyard was home to many “firsts” in U.S. Navy and west coast history, including a permanently constructed dry dock. But the Navy closed the base in 1996, and the impacts on the city have been long and difficult, including the City’s bankruptcy.

With private firm Lennar Mare Island and the City of Vallejo investing in redeveloping the naval base, Mare Island found a new purpose. The 1999 Mare Island Specific Plan laid out a strategic vision for the Island’s renaissance: Reuse existing historic buildings, preserve the historic core, and develop new areas. The Specific Plan established land use designations to provide for parks and open space, reuse areas, and residential, industrial, recreational, and educational uses.

MARE ISLAND. Looking northwest along the Napa River (Mare Island straight), with Mare Island to the left (southwest), and downtown Vallejo to the right (northeast). Photo: James L.

The transfer of the base from the Navy to the City involved many years of coordinated community planning. The guiding vision for the initial Reuse Plan and Specific Plan, and for all subsequent amendments, has held constant. That vision is to create new, well-paying jobs and to restore to Mare Island the vitality that the base brought to Vallejo throughout its recognized long period of significance.

A part of that vision is a growing recognition that Mare Island’s historic character adds incalculably to the level of economic development opportunities and types of jobs that can be created in the city and the region. The scale and scope of the buildings has attracted the film industry, world class Touro University, and Factory OS, which builds individual segments of modular homes.

Factory OS (OS stands for Operating System) is addressing the exponentially higher cost of housing with streamlined fabrication processes, greener and more efficient material use, design and code changes, employee training, and coordinated on-site construction, all with the goal of building more and more affordable housing.

AT FACTORY OS. Inside a finished living and kitchen space of a modular unit.

Since his January 2019 inauguration, Governor Gavin Newsom has moved swiftly to address the state’s housing crisis, championing initiatives with the potential to transform the face of urban California. He has proposed spending $1.75 billion to incentivize housing production, raising housing targets for local jurisdictions, and aggressively enforcing those targets.

Factory OS plays a significant part in addressing the challenges faced by the housing industry. The firm is pairing with UC Berkeley on significant research breakthroughs through the launch of an independent Innovation Lab within UC Berkeley’s Terner Center for Housing Innovation.

AT FACTORY OS. A modular unit in its exterior frame and ready to be shipped.

The City of Vallejo has teamed up with the City of Emeryville to demonstrate the factory-to-built-environment product. On April 14, the team will accompany attendees at the American Planning Association’s national conference on an afternoon mobile workshop to discuss affordable housing, technological innovation, and base reuse. The workshop includes a tour of the Factory OS site on Mare Island in Vallejo, led by Vallejo’s Afshan Hamid, and Rick Holliday with Factory OS; the Lennar Mare Island base reuse project, led by Lennar’s Tom Sheaff; and a stop in Emeryville for a construction demonstration where a modular apartment is being assembled, led by Charles Bryant, AICP, Director of Planning and Building, City of Emeryville.

Afshan Hamid, AICP, is the planning manager of the City of Vallejo. She also is Northern Section’s Professional Development Coordinator, with responsibility for the Section’s professional development program for the continuing education of practicing planners. Hamid holds an M.Arch in architecture and urban planning from MIT and a B.A. in fine arts and industrial design from the University of Illinois at Chicago.

Taking the high road to fix California’s broken housing production system
Figure 1. Residential Construction Productivity

Taking the high road to fix California’s broken housing production system

By Alex Lantsberg, AICP, and Roxana Aslan.

CALIFORNIA is caught in a pair of traps affecting what kind of housing is built and where, and how it is produced. Together, they reinforce a dynamic of suppressed housing construction, unaffordability, and displacement. Policy makers are understandably focused on making it easier to issue permits for where the multifamily housing in California is needed. They must do more in that regard. Those same lawmakers must also consider the construction labor bottleneck that limits how many units can be produced. By anchoring housing permitting and financing policies around labor standards for construction, the state can facilitate the increased multifamily infill development it so desperately needs.

Despite an acrimonious housing debate, the “what and where” trap is the easier of the two to fix. Consumer preferences have shifted toward denser urban lifestyles, pushed along by policies to help adapt to and mitigate the effects of climate change. Yet large portions of California metros’ high-demand transit-proximate areas are off limits to apartments. Where they are allowed, existing incentives tend to produce large, amenity-rich complexes. With land prices escalating, this often means that only the deepest pocketed builders can compete to deliver a luxury product to grab high-end demand. The market, however, has been unable to build enough of the housing in greatest need.

The state legislature has streamlined permitting for deed-restricted affordable housing and has eliminated some of the barriers faced by accessory dwelling units. These efforts, while laudable, are only down payments on the reforms needed to revitalize the housing construction market, and particularly to expand production of low and moderate income housing.

Loosening restrictions on apartment construction can help resolve this situation but will not address the “how” of production. For that, the state must intervene to fix a broken system that cannot fix itself.

Demand for homes is robust, but there are neither the contractors nor the construction workers to build them. Homebuilders’ low wages and poor labor standards make it difficult to attract new workers. Low pay in most private residential construction makes it a persistent challenge to keep skilled workers from leaving for better compensated commercial and public works construction. The resulting turnover makes it uneconomical for builders to invest in training to improve the productivity of the existing workforce. The most capable residential builders and workers gravitate to publicly subsidized projects with wage standards that largely avoid these dynamics. Neither does the coastal areas’ high cost of living make it economical for new firms, or workers from other regions, to move to California to fill the gaps. Without intervention, the production system remains stuck in low gear.

Integrating labor standards with policies to increase multifamily home construction will allow California to improve housing affordability by rebuilding its housing production system. This “high road” approach is based on paying workers wages sufficient to allow a dignified work and post-work life, supporting workforce development through apprentice training, and improving productivity by upgrading safety and skills. It would recreate the labor relations system in place during the state’s housing construction heyday from the 1950s through the 1980s when the California routinely produced between 200,000 and 300,000 units.

Labor needs

Figure 1. Residential Construction Productivity

Meeting Governor Newsom’s goal of 3.5 million new homes in California in the next 10 years will require a massive increase in the rate of housing production to an average of 350,000 units per year. Building permit data show only 102,350 housing units authorized for 2016 and 114,780 for 2017. The number of units produced per worker, which was above 1.2 between 1990 and 2006, has not exceeded one unit per worker since then.

The labor required to meet the goal of 350,000 units is unlikely to be met whether productivity remains at its current levels or regains pre-recession levels. At its current production of roughly one housing unit per worker, California would need approximately 350,000 residential building construction workers per year — a workforce three times its current size and more than double its pre-recession peak. If productivity rebounds to pre-recession levels, nearly 140,000 more workers (approximately 257,000 total) will be needed.

Figure 2. Estimated Regional Workforce Requirements for 350,000 homes per year

Contractor shortage

Discussion about the causes of the housing shortage has revolved around regulatory barriers to new multifamily supply, but few have focused on the construction industry’s capacity for housing production. After the Great Recession, the construction industry underwent significant changes that still constrain capacity. Many builders went bankrupt or reallocated their workers and resources. These contractors have yet to regain their previous form.

General contractors in the state have become smaller, and with fewer firms employing fewer people, construction capacity remains below its 2006 peak.

Figure 3. General Contractors (NAICS 236) in California 2006 vs. 2016

The residential construction industry has seen even greater declines. Current employment at multifamily residential general contractors is less than 80 percent of what it was a decade earlier, and the number of firms is down by more than a quarter.

The decline in housing construction employment in the state, while varying substantially by region, is linked to an even steeper decline in the number of multifamily general contractors; only the Bay Area reaches its 2006 level.

Figure 4. Multifamily General Contractors (NAICS 236116) in California 2006 vs. 2016

The decline in construction firm capacity correlates with the decline in housing production and indicates a serious capacity issue. Even in high-demand coastal areas the building industry is not large enough to ramp up production and provide the state with the new housing it requires. This has given builders immense pricing power that is contributing to unsustainable price increases.

Labor shortage

The tightening and consolidation of California’s contracting capacity is linked to the severe shortage of residential construction labor. Construction employment nationwide remains below pre-recession peaks — despite an improved economy and boost in construction — because the housing bust and subsequent recession displaced large numbers of construction workers, a majority of whom moved to other industries or left the formal labor market.

California’s construction labor market has generally followed national trends. Employment in nonresidential building construction returned to pre-recession levels by 2016, but employment in residential building construction remained about 37,000 workers short of its pre-recession peak.

The residential construction worker shortage is contemporaneous with the shortage of housing production across California. Housing production and residential construction employment both began to plateau around 2013.

Figure 5. Housing Production, Contracting Capacity, and Construction Employment

This shortfall is undermining growth in the housing stock at a time when it needs to grow quickly to meet demand, particularly for thousands of families displaced by catastrophic wildfires in 2017 and 2018.

One factor is a decline in younger people in residential construction. The participation of workers under 25 has declined by nearly 40 percent since 1992, dropping from 13.4 percent of the workforce to 8.2 percent. The percent of hires in the 19–24 age group has declined from over 8.3 percent in 2005 to less than 7 percent by 2017, a drop of more than 16 percent. The graying of the construction workforce has exceeded the aging in the rest of California’s economy.

Figure 6. Change in Composition of Workforce Age in California Construction vs. All Industries

Historically, construction wages were comparable to those in manufacturing, while higher than many service sector jobs and the average private sector job. Today, US construction workers make less than they did 40 years ago. Examining annual pay for different construction sub-sectors since 1992, it is clear that residential building construction workers are generally paid less than similarly skilled workers in nonresidential and civil engineering construction. The lower wages appear to factor into the sluggish rate of housing production since the Great Recession.

Figure 7. Construction Sub-sector wages

Looking at the pay differential in percentage terms makes its relationship with housing production clearer. Decreases in the gap between nonresidential and residential construction are associated with an increase in housing production.

Figure 8. Housing Production and Residential Wage Gap

Workers moving into construction generally received at least a 20 percent wage premium from their prior jobs. (Scott Littlehale, Jan. 2019) The residential sector fails to deliver such a premium.

Where to go from here

California can only solve its housing crisis by producing substantially more units in the right places, something that will require more workers and higher workforce productivity. But at current productivity levels, California’s residential construction workforce would need to triple to meet state housing goals.

Workers today have little incentive to join or stay in residential construction. Wages are stagnant – and benefit participation is declining – while opportunities are expanding in higher paying construction sub-sectors like public infrastructure. At the same time, residential builders are relying on an undertrained and underpaid workforce rather than on highly trained workers as they once did. Irrespective of land use regulations, these developers will be slow to build housing without a readily available pool of healthy, skilled, and dedicated construction workers.

As California proceeds to streamline the development process and incentivize residential density, it must also consider the workers — those who build the dwellings — by attaching prevailing wage and apprenticeship requirements to procedural reforms. Because blue-collar wages and benefits comprise only about 15 percent of the total costs of a residential project, the impact on project costs is minimal and outweighed by the benefits of procedural streamlining and reduced parking requirements. Since prevailing wage regulations preclude contractors from cutting wages to win bids, they enable at least some construction workers to live in the homes and communities where they build. Apprenticeships will help attract people to the residential construction workforce by making residential construction a viable and sustainable career path. If the state through its policies can help rebuild its housing production system, California’s housing crisis may soon end.

Alex Lantsberg, AICP, is the San Francisco Electrical Construction Industry’s research and advocacy director. As a planner, researcher, and advocate, Lantsberg has worked on housing, labor, infrastructure, and sustainability issues in northern California for the past 16 years. He served on the APA California – Northern Section board as co-chair of the sustainability committee, 2015–2017. You can reach him at lantsberg@gmail.com

 

 

 

 

Roxana Aslan is a Research Analyst with UNITE-HERE Local 11, which represents 30,000 workers in hotels, restaurants, airports, sports arenas, and convention centers in Southern California and Arizona. Her master’s degree from UCLA is in city/urban, community, and regional planning, with a specialization in community economic development and housing; and she holds a B.S. in environmental sciences and health from the University of Southern California.