Housing Policy is Climate Policy: How Local Zoning Regulations Hurt the Environment

A new study by UC Berkeley and UC Irvine scholars, commissioned by the California Air Resources Board (CARB) and California Environmental Protection Agency (CalEPA) examines the impact of local zoning, permitting, and environmental review on housing development and sprawl — a major driver of carbon emissions from automobile dependence. 

The findings are clear: “​​Local regulation…appears inadequate to support both climate and fair housing goals.”

Key takeaways:

  1. Local land use regulations, including zoning and permitting, are the largest obstacle to dense urban infill housing near transit, which would enable major reductions in greenhouse gas emissions in the transportation sector. In several jurisdictions, local planning rules are a greater detriment to urban infill than exurban sprawl.
  2. Most efforts to block housing are based on administrative appeals through local land-use rules, not environmental litigation—and even then, 70% of anti-housing litigation emphasized local planning rules, not just the California Environmental Quality Act (CEQA). Moreover, infill housing faces just as much litigation as sprawl, suggesting that environmental law is not favoring environmentally friendly housing development.
  3. Far from protecting vulnerable communities, the incentives of adversarial legalism in California have encouraged demolition of rent-controlled housing in disinvested neighborhoods to build new housing, while by the same token, more exclusive and affluent jurisdictions see little affordable housing being built.

O’Neill et al (2021) show how local governments in California are thwarting progress on reducing greenhouse gas emissions statewide, with a little help from the state’s touchstone environmental law, CEQA. In 2018, the California Air Resources Board (CARB) reported that the state was on track to miss its legally mandated benchmarks for emissions reductions by 2030 unless Vehicle Miles Traveled (VMT) per capita fell by at least 25% — even in the most optimistic scenario for electric vehicle adoption. 

This means that, in order for the state to achieve its climate objectives, the state’s housing shortage needs to be addressed with more homes near transit, jobs, schools, and other amenities to reduce demand for automobile trips. Instead, local governments across the state are encouraging environmentally destructive, car-dependent, low-density housing development.

The report forms part of an ongoing study called the Comprehensive Assessment of Land use Entitlements Study (CALES). CALES now includes more data from urban and exurban jurisdictions to examine how local permitting for new housing contributes to VMT and racial segregation across the state. The analysis “includes both base zoning and process in order to understand whether [cities] appear to have regulatory obstacles to affordable housing and multi-family housing” — building off a vast body of literature finding correlations between low density zoning,local obstruction via permitting processes, and segregation by class and race.

The report is focused on more granular questions raised in the literature and policy debates, namely: what kinds of regulations have exclusionary outcomes, and how do they encourage suburban sprawl? 

To examine the relationship between local regulations, housing costs, and VMT, the researchers culled from several high-cost metros in California (the state has no shortage of them, after all) to build out representative case studies. First, they selected for jurisdictions with “a minimum population of 50,000 people and a minimum land area of 5 square miles” — including urban cores and inner-ring suburbs. Next, they selected four jurisdictions with representative exurbs to compare against urban infill: LA County, San Diego County, Placer County, and Roseville in the Sacramento metro area. 

In each jurisdiction, O’Neill et al examined “permitted and restricted uses, height limitations within specific neighborhoods, maximum commercial and residential density and lot coverage, minimum parking requirements (if applicable), and rules governing appeals in each jurisdiction”; along with other regulations that could impact housing supply, such as “inclusionary housing ordinances, local referenda to generate affordable housing supply, rent stabilization ordinances, anti-demolition ordinances, and neighborhood planning…” 

Last but not least, the researchers examined the base zoning in these jurisdictions to “identify the amount of land area within the jurisdiction that meets that state-determined density default standard [for affordable housing]” — 30 dwelling units per acre in urban jurisdictions, and 20 dwelling units per acre in suburban ones.

While these variables are generally illustrative of the capacity for new housing in each jurisdiction, the researchers also examined permitting data to compare local regulations, along with court records of lawsuits, with how much new housing was actually built from 2014-2017.

The results are damning. Most of the cities with available zoning data “​​have less than ten percent of their total zoned land area zoned for multi-family housing sufficient to accommodate all income levels.” To make matters worse, a majority of these cities also had more restrictive zoning close to transit — the exact opposite of what CARB recommends to reduce transportation emissions. 

While San Francisco had relatively more permissive zoning than other cities in the study, it also had some of the worst discretionary review processes in the state—which contribute just as much, if not more, to segregation and sprawl. However, the researchers also observe that even where development is nominally by-right, “the number of approval steps does not appear to correlate with median [permitting] timeframes” — which means that the stringency of the process is not just a function of statutory requirements on paper, but the legal regime itself. San Francisco and Santa Monica, with fewer “steps” for approval, had some of the longest permitting timelines on average.

Some advocates contend that strict local regulations are needed to protect lower-income renters in vulnerable communities. But particularly in Los Angeles, the data shows that developers “​​demolished a high number of units that likely resulted in direct displacement of tenants”—and even though more net housing supply may have resulted, these lacked one-to-one replacements with deed-restricted affordable housing, as Senate Bill 8 now requires (and Senate Bill 50 would have required if it had passed). 

To make matters worse, this pattern still encourages sprawl. As the researchers observe, when projects face just as much uncertainty in the permitting process in urban or exurban jurisdictions, developers prefer to absorb those costs in agricultural areas, where land costs are lower to compensate for the uncertainty. Therefore, easing local restrictions on urban infill housing while strengthening tenant protections could prevent displacement while also reducing incentives for exurban sprawl development and combatting automobile dependence.