California’s housing shortage impacts residents of all income brackets as rents and home prices remain elevated in 2022 and demand outstrips supply.
Building new housing is a challenge in California due to high land and labor costs, regulations and development fees. Constructing just one unit of housing in California costs an average of $326,000, according to the U.S. Government Accountability Office.
As rents and home prices rise, the need for low-income housing soars in tandem. But those rising costs of construction remain a roadblock to achieving more low-income housing options.
Yet there’s another curtailing factor, other than costs, stymying housing development for lower income budgets. It involves an article found within the state constitution: Article 34.
Article 34 squashes affordability
Under Article 34, any low-income housing project with federal, state or local financing is prohibited without voter approval. It’s the only type of housing subject to voter preference.
Article 34 was introduced to voters as Proposition 10 in 1950 by the California Real Estate Association — now the California Association of Realtors (CAR). The rationale held that taxpayers have a right to vote on low-income housing projects since they are publicly funded through tax dollars, but the campaign also stoked fear over racial integration and socialism, according to the Los Angeles Times.
Thus, Article 34 becomes a racist relic of real estate past which continues to impact housing development today. Ensuring compliance with this provision adds between $10,000 and $80,000 to the cost of building a below-market rate unit, according to the Mercury News.
In fact, CAR, the trade group responsible for the implementation of Article 34 in 1950, is now co-sponsoring a bill to repeal Article 34, along with offering a public apology for its legacy of discrimination.
In the upcoming 2024 election cycle, California voters may get the chance to repeal the decades-old amendment. If so, it will be the fourth time the issue is brought to the ballot box. All three previous attempts to remove or weaken Article 34 were defeated by voters — the last attempt was in 1993.
2022 election results reveal voter support for housing
In California’s November 2022 general election, no statewide housing-related measures appeared on the ballot. Instead, voters faced local choices regarding housing issues.
In total, Californians voted on 52 different local measures in the November 2022 election, according to the Terner Center for Housing Innovation.
Five of those measures involved Article 34-related approvals, and appeared on ballots in:
- Oakland;
- Berkeley;
- Los Angeles;
- Sacramento; and
- South San Francisco.
All five cities voting on Article 34 measures approved building the low-income housing projects proposed in their communities, according to the Sacramento Bee.
In fact, across the state, voters consistently backed pro-housing ballot measures, while rejecting measures making it harder to build.
Polls show 76% of adults support increasing the amount of rental housing appropriate for lower- and middle-income Californians, according to the Public Policy Institute of California.
Judging by the 2022 election results, increasing the amount of housing for low- and mid-income residents is a top priority. To address this need, California legislators need to keep supporting legislative changes that encourage builders to construct more housing for this demographic.
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