Funding The Affordable Housing Crisis
KPBS Roundtable / August 2, 2019
San Diego moves to ease the city's affordable housing crisis. As climate change continues, ice is melting in the north and homeowners are having a tough time protecting their properties from damage.
Speaker 1: 00:02 Citing horrific wildfires and coming sea level rise. Insurers are refusing to write policies in certain parts of California. Record heat in the Arctic and Greenland is causing alarming rates of melting ice and scientists fear global warming is starting to accelerate and the San Diego City Council takes controversial actions to ease the crisis in affordable housing. I'm mark Sauer. The KPBS round starts now.
Speaker 2: 00:36 [inaudible]
Speaker 1: 00:40 welcome to our discussion of the week's top stories. I'm mark Sauer and joining me at the KPBS round table today. Michael Small ones, columnist with the San Diego Union Tribune, KPBS Metro reporter Andrew Bowen and KPBS environment reporter Eric Anderson. Well, hundreds of thousands of California homes worth hundreds of billions of dollars are prone to destruction from wildfires, many thousands more along the coast, including some of the most expensive homes in the world, face threats of flooding and crumbling cliffs from sea level rise. All of this is exacerbated by global warming and insurance companies are taking heat. And Michael, you had a column this week. Start with the fire zones here. Insurers are reeling 20 billion in fire losses last year in California alone. I'm refusing to insure now certain parts of the state. Full Mark,
Speaker 3: 01:28 you're ready to take a quick step back first. I think what we're going to see in the not too distant future is that actually the insurance industry is going to be dictating where development occurs in California and elsewhere more so than government. Uh, because as you mentioned that that, uh, policies are being canceled in certain areas of the states, back country particularly, you know, the high fire zone areas, uh, those people that are scrambling to get insurance and their rates are going up and a lot of people are being relegated to, to getting the, uh, um, insurance of last resort through the state. Uh, that's just, this is just sort of beginning now and a, what's interesting are insurance companies and the industry at large is starting to look to factor in the climate change effect that could further impact, uh, insurance rate.
Speaker 1: 02:11 That's also gotta be a, an effect on premium themselves. If you're in some of these areas now maybe you can get a policy, but it's becomes exorbitant.
Speaker 3: 02:19 Well, yeah. And, and it has a real kind of a domino effect. Uh, in northern California, the area wildfire areas have really been hit in terms of insurance. And what's interesting up there, there's a particular conveyor belt of retirees from the bay area looking at these, you know, beautiful, you know, back country mountain s homes like paradise. Yeah. And they're looking there and realizing that the insurance is a, you know, really high and unaffordable and that has a trickle down because those are pretty kind of not too well off communities and they like having those people out there. So there's that. But, uh, you know, we've learned that that insurance companies are starting to basically cut out entire zip codes, uh, in certain high risk areas. And so I think you're going to see sort of, um, wildfire and frankly, climate change redlining,
Speaker 4: 03:04 Eric. But there's, uh, Michael, there's no reluctance here in San Diego county to offer and get approval for large residential tracks in the back country that are not accessible by roads. And A, and r would be difficult situations if a wildfire moved through that area. There, there isn't that nobody's holding back. In fact, the county is going out of its way now to, to approve projects that it previously said don't fit what we want in our general plan.
Speaker 3: 03:36 Disconnect or you're saying it seems that way a how those projects, I mean the county, the projects you were referring to, I think, uh, amount of about 10,000 homes on the planning boards, um, many of which we've approved are in the pipeline. And there is, you know, there's the usual pushback from environmentalists and people that live out in those areas that don't want more congestion, but the whole fire safety aspect has always been there, but it's really a become a premium concern and yeah, it's a, you know, it'll be interesting to see as they build these homes and as we're seeing the insurance industry react to home's already in high risk fire zones. What happens there and does that affect the marketability of these houses if they do move forward? So, uh, we're probably gonna see some really interesting changes and, uh, some real interesting dynamics on these developments and whether they all ultimately go forward.
Speaker 3: 04:27 No. You reported the, also in the column of California Insurance Commission or working with the United Nations regarding the state's climate risks going forward. What's a little bit, well, you know, if you're calling in the United Nations to, there's a problem, you'd think, ah, the United Nations has a sort of an insurance, you know, initiative that global that they're looking at and a lot of it has to do really is about climate change. And looking at, uh, the things we've been talking about, insurance availability and how that works. And, uh, there's not a lot of description of what they're doing. There's just starting off of working together. But, you know, it seems to me that there's only so many things you can do when a, there's development in, you know, high risk fire zones, zones that we know are going to be flooded, if not under water, uh, in the distant future. And that's some sort of, you know, build defenses, shelter in place, uh, move or reverse climate change, which of course is the difficult thing because the greatest country in the world, the United States is not a, the administration just doesn't seem to think that that's really happened.
Speaker 4: 05:24 Yeah. Climate denial is just extraordinary fraud starting with Trump and his administration. Dad Speaking to the u n he just named a new ambassador yesterday who's a, a well Fox News personality and another climate change denier. So Eric [inaudible] you think it'll get to the point where there will have to be some sort of a state agency created like they do for earthquakes? Uh, where the insurance industry just says, we're not going to cover you if you live here, but there might be some sort of recourse for homeowners.
Speaker 3: 05:53 I'm sure there will be pressure. There's already pressure from homeowners are sort of you complaining to the state, you know, you've got to do something about this. And the, the, you know, the last resort fund is largely built up through contributions or required contributions by the insurance industry. But if this goes down the path that it seems to be going that, that there's going to be such pressure to, to you know, have some kind of insurance and then you know, is that going to be a taxpayer liability and our tax payers gonna wanna you know, subsidize people that are building a known areas that that are are subject to a great risk of a disaster. Yeah. I just, I wonder as climate change gets worse and worse than these wildfires get more frequent and more destructive, are we going to at some point as a society reach a point where we say if a community burdens down, we can't rebuild there.
Speaker 3: 06:39 We can't allow it. Even if folks were living there before because uh, you know, we seen it happen there again and again. And you also mentioned, you know, retirees moving out from the bay area to the back country. I mean, the bay area we know is exorbitantly expensive and this really does, I think, tie into the debate about affordable housing in, in our state. Because if we're not creating places for those folks to live and to age in place, then perhaps moving to these dangerous areas is the only option for them. But how are we going to house them if they're not able to, um, if we're not able to build the housing where they want to stay? Well, you know, you mentioned that, you know, will they just not let people move or live to certain places? Like I said, is government as we've known.
Speaker 3: 07:21 And I think in, in what you'll be talking about, it's a very difficult thing to do in terms of dictating where development happens. And like I said, maybe the insurance company will be a big factor in that in the future. Um, it's interesting because the, the industry is now looking at for the first time really for wildfires, last year's wildfires, the, uh, the campfire, uh, the major insurance company, I forget the, the big one in Germany, but it's the largest in the company, assessed a, a great deal of the damage or you know, significant amount of damage to climate change that it made it more intense. The same outfit back in the 2012, um, superstorm Sandy, Sandy PR, uh, estimated at about 30% of the damage really was a result of a more intense storm made by climate change. So that's just starting to happen now. And you're just gonna see it more and more.
Speaker 3: 08:07 And there's already a battle between the state and insurance companies about whether they can factor in climate change in their, in their previous, do you think it'll be a case where they have like climate change writers on your, on your policy? Well, who knows, but like I said, that the, I think the insurance industry wants to move in that direction. The states resisting, understandably because they're sort of like, okay, well insurance has always been based on history more, more or less, uh, you know, there are certain future risks, but they, they worry about certain models not coming forth and people paying for disasters that might not happen. But that's sort of what insurers,
Speaker 1: 08:39 well, and we're going to get in a moment a into rising a m c levels here, which is, is, is coming very fast. And that's another issue besides the wildfires, of course, the coastal impacts there.
Speaker 3: 08:50 Yeah, it's more of a slow moving one. Like most people react to climate change. I mean, the wildfires are here and they have been, you know, the question but more intense and more frequencies. Andrew mentioned more, but we, we've seen maps. We know what is going to, you know, be effected to the degree it will be affected. Depends on just how bad climate change gets. But, uh, you know, for instance, del Mar, we know those, you know, beautiful, expensive homes right on the beach are gonna be impacted. What do they do there? Do they, do they, you know, try to build defenses or somehow move them out, which people don't like that idea at all.
Speaker 1: 09:21 Right. All right, well let's shift gears here and we'll see just how alarming it is. Let's move now to global dynamics at work and our changing climate. Alarming news this week about record heat causing rapid ice melt in the planet's coldest regions in a, Eric, let's start with what researchers from Scripps Institution of Oceanography [inaudible]. What are they finding in the Arctic? Well what they did, a group of researchers,
Speaker 4: 09:44 Terzian Eisenman among them, uh, looked at, uh, how fast the arctic ice cap is melting. That's the ice that's in the, in the water, uh, at the North Pole. And, you know, it swells and shrinks every year with the seasons. Um, but there's been a trend since 2012 where it, when it grows back, it doesn't grow back as large and when it shrinks, it shrinks to a smaller degree. And so the trend line has been that, you know, there's been less and less ice floating around the North Pole and what the researchers were looking at and what they were interested in finding out was whether or not, you know, what kind of an impact is that gonna have on our climate. And they, they determined that, you know, losing that ice cap means that the planet's not able to reflect heat back out into space that doesn't, you know, hit their earth and unbounce pack, uh, and replacing it with dark ocean water, which actually absorbs that heat.
Speaker 4: 10:35 Uh, you know, it changes the dynamic and, and, uh, you know, they kind of extrapolated over what they had seen over the last couple of years, last couple of decades and look forward a little bit. And they said, look, if the entire polar ice cap goes away, if it's just, if there's no ice up there because, uh, the environment, uh, becomes too warm, um, then that could speed our, our rush to critical climate change. Mileposts like 1.6 degree increase in, in, in average planet temperature, which would be, yeah, which would be, which will be dramatic and or the to two degree mark, which is what the Paris climate accords are designed to, to keep us from reaching a, they think that could happen up to 25 years faster. Um, which, uh, the first question I have when they told me that was like, well, when is it going to happen now? And, and that, that question is, it's kind of like an accordion. We're not quite sure, because people still have the ability to interact and there's, we could still have an impact on what happens, but, but they think if that all that ice goes away, uh, we reached these critical mile posts, uh, that are, you know, dangerous for our planet, um, 25 years faster than, than we otherwise would.
Speaker 1: 11:50 Greenland Greenland's a different story because you have this enormous ice sheet in
Speaker 4: 11:54 Greenland, but you mentioned the, uh, the ice up in, in the, uh, polar regions is already in the water, but the Greenland melts. I mean, you were talking about the disaster worldwide. Well, it's a couple of things there. You're right. You're right. Uh, you're absolutely right. The ice in the water around the North Pole, it's already in the water, so it's not going to affect sea level rise and they're totally displacement. Yeah. There's no, there's no change in sea level. Uh, the ice in Greenland is on land, so if it melts, it goes into the ocean. It could, if all of it melts, you know, push up sea levels 23 feet, and you think about that along our coast. Uh, that's a pretty dramatic mark. Um, the Antarctic has another hundred, uh, and or 20 feet or so. If all that ice melts, uh, at the southern pole, we're going to see dramatic increases and sea level rise.
Speaker 4: 12:40 But what's happening now in Greenland, uh, is something that actually happened back in 2012, uh, which was the, the, the conditions around Greenland are so warm now that the ice in the center of Greenland is melting. Um, uh, last happened in 2012 surface everywhere, right? The first surface everywhere is nothing, but it's happening on the interior, which is rare. It last happened in 2012 before that, it was the 18 hundreds, uh, before that happened. Uh, so it's, it's the frequency of these melting events has kind of stepped up, which has a risk for sea level rise. And of course, if you reduce that ice cap on Greenland, you're also reducing the reflectivity there as well. Michael,
Speaker 3: 13:18 the, I think the 1.6 degrees Celsius, uh, you know, being sort of a turning point or a threshold. Some people I think in as six degrees would be disastrous inquiries as what you're [inaudible] you 1.6 is one six degrees. It would be thinkable on this planet. There will be significant change. The point that I'm getting at is is that are a lot of these models sort of the more kind of middle of the road or moderate ones a that we don't hear so much about the more catastrophic ones, which of course, you know, might not happen, but they, they certainly could. Well certainly the fact that things seem to be speeding up beyond what was projected, uh, are those kind of more drastic model's going to be taken into account more or more?
Speaker 4: 13:58 Well, I think what, what you realize is whenever you're doing a scientific model and trying to predict something, you have to have a range of outcomes, a range of potential outcomes. Uh, what happens a lot with sea level rise, for example, uh, the, um, the US geological survey has a pretty good, uh, model for sea level rise. If, if it happens at a certain level, this will happen kind of a cause and effect type of thing. But you can't really predict the extent because the models aren't so good that you can say with confidence. So, uh, that a certain thing is going to happen at a certain time. So what they do is they offer a range. Now the sea level rise ranges, how are all being kind of in the last three years have all been shifted upward pretty significantly. They used to have the low impact by 2050 of, you know, a foot or less than a foot. Then they consider the median impact of of three or four feet increase and then a severe impact of six feet. And now, now the three or four feet of impact might be considered the low end. And they've kind of discarded the, the, the idea that it's just gonna be a foot or so.
Speaker 5: 15:06 Yeah. And I think this is one thing that some people don't really understand about climate change, which is that it's really a spectrum of possibilities. And it's not a question of whether or not it's going to happen or it's really, you know, we, we have, uh, you know, the word every, every bit of carbon that we admitted into the atmosphere when we drive our cars or turn on the lights or whatever, um, that is increasing the likelihood of these scenarios getting worse and worse. And so, you know, I've, I've heard people say, well, if the United States, um, you know, reduces its carbon emissions, China's just going to, um, not follow suit and, and you know, global warming will still happen, but the, the less carbon that we put into the atmosphere, even if it's just the United States acting alone, is also going to reduce the likelihood of these doomsday scenarios.
Speaker 4: 15:51 That is correct. That's correct. And remember, it's a prediction. It's an idea. They can't, you can't, uh, convince a quality scientist to tell you exactly where and how much and when a specific outcome is going to happen. But they'll give you a range of possibilities. And, and if you look at where that range is kind of moved, it's, it's moved up and there's no question about it. Uh, the last UN science report on the climate was pretty damning. I wanted to bring that up. Now when you're talking to, you're interviewing the scientists here at scripts, uh, you know, that that report you're talking about gives us roughly 12 years or less to radically cut back on burning fossil fuels worldwide. As you're saying, uh, how alarmed by the script scientists, uh, about that, that 12 years and what's really going to happen if we don't?
Speaker 4: 16:36 Um, I think they're as alarmed as you can be as a scientist. These are rational, educated men who are looking at this issue, men and women who are looking at this issue, who are saying, look, um, this is not what we expected. Uh, five years ago, forecasts were to conserve. This was not what we expected, where we're, we expected us to be today. And so our forecast from five years ago are probably not accurate in terms of where we're headed. Um, and there is a window of time, uh, where the impacts that we cause need to be reduced if we want to avoid some of these drastic outcomes. A lot more to say about that on this show. And of course as we're in the a election year and a lot of the candidates were weighing in the median cost of a home in San Diego neared $600,000 in June. No wonder our housing crisis continues unabated, moves by the San Diego City Council this week were intended to ease the crisis by providing more affordable housing and thousands more units near future trolley stations. Well, uh, Andrew Start there, uh, with the council's action on inclusionary housing, which is a little awkward. Buzzworthy yes, it is. What is the policy? What's the chain? Yeah,
Speaker 5: 17:50 so this first policy was first adopted by the city in 2003. It hadn't really changed much since then and um, essentially gives most, in most cases it gives developers two options. You can set aside 10% of your homes in your project for low income households and agree to charge them affordable rents. So below market rate or you can pay a fee. And that fee then is collected by a the housing commission and is used to, to build and support affordable housing elsewhere in the city council. President Gomez, when she came in as she was elected council president, um, she had made clear far earlier than that actually, that she wanted to take on this policy and change it, basically make developers pay more of the share of, of supporting affordable housing. So what her proposal was, was on nearly doubling the fee that developers pay when they don't include those homes in their projects. And when they do include those homes in their projects, they're targeting a lower income groups. So that means that the developers will have to charge lower rents to those and there'll be recovering less and they'll will essentially be greater offering greater subsidies to affordable housing.
Speaker 1: 18:54 No. The, the council members that supported this change, what impact did they think this will have on this crisis?
Speaker 5: 19:00 Well, they, uh, they're, the goals are really two fold. That one on the one hand, they want more revenue for affordable housing. And that's the, the reason for the higher fees, uh, but they also want to incentivize more developers to, uh, be proposing mixed income projects. So we have a low income households living in the same building as higher income households and those low income folks who will have access to the same neighborhood amenities, uh, you know, educational and job opportunities. So, um, it, those are the two essential goals of affordable housing or inclusionary housing.
Speaker 1: 19:32 And developer's not crazy about this idea.
Speaker 5: 19:34 Definitely not. Uh, so, uh, what they say is essentially that our housing crisis, one of the primary drivers of the housing crisis is the shortage of housing. Uh, you know, you cut the supply and uh, and prices go up. So, um, you, they're saying this essentially adds costs to a building housing and you can't add costs to something and at the same time expect to get more of it. Uh, so their fear is essentially that this change will chill the market. And of course, if you're not, uh, building market rate housing, then you're also not getting those fees that support affordable housing or those affordable units that are included. Essentially, if a, if a housing project never gets built, then you're not getting any market rate or affordable housing. That's their argument.
Speaker 1: 20:18 Tight five, four vote on the council. The mayor gonna maybe veto this, could they override it and get a sixth vote? Yep.
Speaker 5: 20:24 So a, yeah, Faulkner has a mayor. Kevin Faulkner has been pretty quiet on this publicly at least, uh, you know, if he vetoes it, um, I wouldn't be surprised. He certainly has a lot of supporters in the building industry. Um, if he doesn't, you know, maybe he struck some deal with the council president. Uh, but um, you know, if he does be to it, then someone on the council will have to change their minds. There was one Democrat, the only Democrat who voted against this Vivian Moreno. And uh, so, you know, that's not a huge surprise cause she was also supported by the building industry. But um, something will have to change. They'll have to come up with some other alternative.
Speaker 1: 20:59 All right. Listen, look, let's go ahead.
Speaker 3: 21:00 I was just gonna say, it's also interesting whether this all comes to pass, but some people are talking about if it is finally approved a referendums possible or, or a lawsuit under the, uh, environmental quality act. Uh, so we'll see. There might be a lot of pressure still on her to change before that. A second reading or the final reading and this later the, I guess the fall or September. But, uh, uh, yeah. Uh, the mayor did laude his housing program that got through, uh, but uh, didn't say anything about hers.
Speaker 1: 21:27 All right, let's, that sets up nicely or segue into the rules committee. A vote this year because we were talking about putting something on the ballot a, and it's a bond thing on explain that.
Speaker 5: 21:37 Yeah. So this, the proposal is to ask voters to approve $900 million in bonds that would then go to a support construction of new affordable housing or rehabilitation of existing affordable housing. Uh, they, the, the proponents say it could support about 7,500 homes, uh, geared towards veterans, seniors, people with disabilities, low income households. And they say that this is really the scale of the, this is what is needed to address the scale of this crisis. Uh, especially homelessness. You know, the more people who are unable to live in a home, the more people are going to be forced out onto the streets.
Speaker 1: 22:10 And this would cause a, I think that the story said the 72 bucks a year on average for an increase in taxes for property owners.
Speaker 5: 22:18 Correct. So, uh, the, the proposal is about $19 per $100,000 of assessed value on your home. So they estimate that's an average of about $6 a month for the average homeowner. Um, because it would include increased property taxes. It needs at least six city council members just to get on the, uh, the approval of six council members just to get on the ballot. And then if it does get on the ballot, it would need two thirds of, uh, support from the voters.
Speaker 1: 22:43 All right. And speculation on those two votes. Is that going to happen,
Speaker 5: 22:46 you know, yeah. The, the San Diego Housing Federation, which is the primary proponent of this, uh, has done some polling and they say that they've, you know, got more than 70% of their respondents to their poll to say yes, they would support it. Even if, uh, you know, it does require increasing taxes. Polls can be pretty easy to manipulate by the wording of the questions that you ask people. So, you know, it's hard to say how valid that is or whether it would carry through in an an actual election.
Speaker 3: 23:12 Well, cool. I have to say it because I said every time we talk about raising taxes in San Diego, but some downtown, um, leader once said that famously that you cannot get a two thirds vote for free ice cream in San Diego is still is a very heavy anti-tax mindset here. But you know, having said that, that that is an older mindset and I think that the depth of the problem of homelessness and housing has changed some views. Uh, you know, the, the, the, the polling that, that Andrew talked about is very impressive. Of course, if you face an opposition campaign, it doesn't take much to bring it down below two thirds. But, uh, we've seen other cities, uh, you know, pass
Speaker 4: 23:46 this kind of stuff. But, uh, on a slightly related note, didn't they asked the city also approve a couple of transit central housing projects that are designed to be both more climate friendly and affordable for a segue right into that one for us.
Speaker 5: 24:02 So yeah, I dumped this week on Twitter housing again because there were so many housing proposals talking that the, that were before the council this week. But um, yeah, so there were two site specific growth plans that the council approved unanimously, both of them this week. Uh, one is on the eastern edge of Pacific beach at Balboa Avenue where a, there's going to be a future trolley station. The other one is at Tecolote road a couple of miles south, uh, in the marina district. So, um, these basically a zone for 9,000 more than 9,000 additional homes beyond what the current rules would allow. And Yeah, the goal is essentially to pack more people into these neighborhoods so that more people can live within walking distance of a mass transit station. Um, you know, you mentioned climate change. This is, we know transportation is the largest source of greenhouse gas emissions in, in our city and our county and our state.
Speaker 5: 24:53 And so this might maybe a, you know, the experts say what is required, uh, to, to actually get people out of cars and transition to a more sustainable type of living. And that's a pretty big departure from where the council had gone for years. Yeah. You know, I think that the, the, you know, in the time that I've been in San Diego, which isn't all that long, I'll grant, but, um, you have absolutely seen a shift in a willingness from the council ends. Absolutely. The mayor's office to really push forward these more ambitious plans, uh, you know, increasing density, increasing building heights. Um, that, that, uh, I think that's a testament to the scale of this housing crisis type of rent.
Speaker 4: 25:31 All right. We are out of time, but we'll look forward to stories going forward. Lots happening on the housing thing, especially with the public weighing in. And that does wrap up another week of stories at the KPBS round table. I'd like to thank my guests, Michael Smollens at the San Diego Union Tribune, Andrew Bowen of KPBS News, and Eric Anderson of KPBS news. Reminder, all the stories we discussed available on our website, kpbs.org I'm mark Sauer. Thanks for joining us today and join us next week on the round table.