Post-Election Roundup: Housing on the Ballot

Post-Election Roundup: Housing on the Ballot

With most of the focus on the 2018 midterm elections on who will control Congress, it’s easy to forget about a number of important ballot initiatives across the country with major implications for housing policy.


California’s Proposition 10

Probably the most substantial of the housing-related ballot initiatives this election, Proposition 10 would have repealed the 1995 Costa-Hawkins Act that placed myriad restrictions on the ability of local governments in California to implement rent control. It suffered a crushing defeat, with 62% opposed to 38% in favor.

We’ve written previously on why rent control is a bad idea (or at least a highly undesirable solution compared to land-use deregulation) and the benefits that came from Costa-Hawkins. Even so, stopping a bad policy is no substitute for more comprehensive upzoning and general housing market deregulation.


Berkeley’s Measure Q

Measure Q, which passed overwhelmingly (nearly 70% to 30%), would have exempted newly constructed homes from rent control for 20 years following construction and preserve rent increases that occured while Costa-Hawkins was in effect. Additionally, accessory dwelling units (ADUs, also called “mother-in-law homes”) would also be exempt from rent stabilization.

The first two provisions are a moot point since Prop 10 failed, but because ADUs weren’t covered by Costa-Hawkins, Measure Q will have a meaningful effect.

This is another ballot initiative that doesn’t mark the end of the affordability crisis in California, but it’s certainly a start. If nothing else, it allows homeowners to marginally increase the supply of housing in their areas.


Colorado Amendment 74

One lesser-known ballot initiative with housing market implications was Colorado’s Amendment 74. The measure, which came just short of the required 55% supermajority, stated that “[p]rivate property shall not be taken, of [sic] damaged , OR REDUCED IN FAIR MARKET VALUE BY GOVERNMENT LAW OR REGULATION [emphasis in original] for public or private use, without just compensation.”

The amendment was pitched as a way to protect farmers from environmental regulations, but the text of the amendment may have created the possibility for some resentful NIMBY to sue the government if the land-use or zoning regulations were changed.

How? Suppose, instead of imposing an additional regulation, a city in Colorado radically liberalized its zoning codes, paving the way for new development but reducing the rents (literal and economic) a property owner can collect.

Taken at face value, this amendment could have required compensation not only for “regulatory takings,” but also deregulatory takings. This is another moot point considering the amendment failed, but it’s interesting food for thought on an issue that could emerge in the future if another jurisdiction were to adopt a similar law.


San Francisco’s Propositon C

Passing by a 20-point margin, Proposition C will impose a tax of 0.5% on the gross receipts of companies with revenue above $50 million. The estimated $250 to $300 million in revenue the tax will bring in will be dedicated towards programs to assist San Francisco’s homeless population.

It’s a very progressive initiative that was opposed by two of San Francisco’s most prominent YIMBYs–Senator Scott Wiener and Mayor London Breed. Here’s Wiener’s statement on the matter:

I thought long and hard before taking this position, and I’ll be honest that I struggled with the issue. I’m not anti-tax, having supported various tax measures. I am passionate about finding solutions to homelessness and paying for them, and I’ve put my money where my mouth is in supporting taxes and funding increases for homeless services. It’s not comfortable for me to oppose a tax measure to support the most vulnerable members of our community. Yet, Prop C is extreme, was not responsibly crafted, and isn’t the right answer to this human tragedy.

It’s a massive tax increase that was motivated by the wrongheaded belief that tech companies and the yuppies that work for them are the ones responsible for Silicon Valley’s affordable housing crisis.

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By |2018-11-08T09:27:13-08:00November 8th, 2018|Blog, Land Use Regulation|