Tag: housing

land value tax and housing

Dan Allison3 Comments

Alex Lee introduced, in the last legislative session, AB 362, ‘Real property taxation: land value taxation study’. “This bill would require the California Department of Tax and Fee Administration to conduct or commission a study on the efficacy of a statewide land value taxation system as an alternative to the current appraisal methods utilized for real property taxation.” It got to the Assembly Committee on Revenue and Taxation, but no further. It is, I believe, a two year bill and can be considered in 2024 session.

So what is land value tax? It is a property tax assessed on the value of the land itself, and not on the improvement to the parcel such as buildings. Current property tax in California is based on both, called split-roll, but strongly weighted towards the value of the improvements, not the land. A pure land value tax would shfit entirely to taxing the land, but blended taxes with a shift towards land value would have some beneficial effects.

Why tax the land? Speculators often leave property undeveloped or vacant in hopes of future high profits at development or sale. There are many such parcels in Sacramento, many of them undeveloped or vacant for decades. Why? The owner pays property taxes, but the value of the property is a small fraction of the value of the improvements, and the improvements are zero, so the property tax paid is a fraction of what it would be if the parcel were in productive use.

The result of improvements-based property taxes is that parcel remain unused. If there were a true land value tax, the owner would want to develop their parcel right now, so that they would receive income from the use to offset their property tax. But with the current mixed property tax, there is almost no incentive whatsoever to develop or redevelop. The result? Far less housing that we would otherwise have.

A shift to valuing the land as a greater percentage of the allocation between land and improvements would help. I have searched for the percentage allocation in Sacramento County (the counties, not cities, administer and collect property taxes, but haven’t been able to find it. It may be one of those black boxes that assessors want to keep from the public.

I am not sure whether a land value tax could be implemented at the county level without changes to state law. It seems that state law tightly controls adjustments to total valuation and tax rates, but so far as I’ve found, does not control the allocation to land value and improvements value. If you can point me to resources for better understanding this, please comment.

NY Times: The ‘Georgists’ Are Out There, and They Want to Tax Your Land, Conor Doughherty

more on Steinberg’s transportation and housing proposal

Dan Allison2 Comments

My previous post on Mayor Darrell Steinberg’s transportation measure proposal was based on the August 25 press conference and panel discussion which included Elk Grove Mayor Bobbie Singh-Allen, Steve Cohn of SMART (Sacramento Metro Advocates for Rail and Transit), Cathy Creswell, Chair of Sacramento Housing Alliance, Luke Wood, President of Sacramento State, and Gabby Trejo of Sacramento Area Congregations Together (SacACT).

A ten page summary of the proposal offers more detail on ‘The Climate, Clean Transportation, and Affordable Housing Act of 2024‘. The proposal offers three major program areas, each of which would receive about one-third of the revenue generated.

  1. Affordable housing and displacement prevention
  2. Investing in public transportation
  3. Safe streets and active transportation

For affordable housing, there are three sub-programs:

  • Creation of new affordable housing on vacant or underused infill sites and along existing commercial corridors and/or transit lines: infill housing rather than greenfield development (which can never be affordable because lower housing costs are more than counterbalanced by higher transportation costs)
  • Preventing displacement and homelessness: keeping people in their homes so they don’t become homeless
  • Green Means Go: enhancing infrastructure needed to support affordable infill housing

For public transportation, it would fund high priority public transit improvements, with four elements:

  • Bus rapid transit countywide. This element was important enough to Steinberg that he highlighted it on his webpage, table below. Note that light rail extension is a possible future enhancement to BRT to Elk Grove and the airport, but it does lock in these extensions are other proposals have.
  • Expanding service & frequency on existing transit lines
  • Light rail fleet replacement and station renewal
  • Regional (Intercounty) Transit Network/ express bus services
table of Proposed Bus Rapid Transit Corridors

For safe streets and active transportation, there are two sub-programs:

  • Fixing the roads and active transportation
  • Innovative mobility: unfortunately, the focus is on motor vehicle electrification, and not e-bikes and shared mobility devices

Note that though the documents calls for a half-cent sales tax, Steinberg said he is open to other funding ideas including property tax. He also implied that if the rest of the county is not on board with an innovative investment strategy or tries to water it down with the traditional road building and widening methods, the city would go its own way.

Certainly we need more detail, but I support the vision that Steinberg’s proposal puts forth. Almost of all of our transportation expenditures in the past have disinvested in, or active harmed, communities of low income and people of color. They have continuously widened and extended roadways, mostly for the benefit of high income suburban commuters. They have built and over-built transportation infrastructure that we will never have enough money to maintain, and insisted on building more rather than taking care of what we have. They have actively discriminated against people who walk and bicycle. They have ignored the established fact that adding roadway capacity induces more travel, so that ‘congestion relief’ is always out of reach.

It is time for a new approach, and I believe that Steinberg’s proposal is an important step along the way to a better future.

infill housing for GHG reduction

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The Carbon Footprint Planning Tools and Scenarios webpage of the Cool Climate Network of UC Berkeley has a tool for calculating how much of a contribution various local policies and actions could make to reducing greenhouse gas emissions (GHG). For Sacramento County, the graph produced is:

What is the leading category? Urban infill, which is primarily but not entirely housing. Electric vehicles, the solution most touted by agencies and politicians, comes in fifth.

This finding tracks with other analyses:

Many cities in the region, including Elk Grove, Rancho Cordova, Folsom, and Roseville, and the county of Sacramento, envision of future of continuously expanding greenfield development, which is the exactly opposite of infill. Why? Because greenfield developers make bigger contributions to candidates than infill developers, and greenfield development is the perfect way of gaining property tax income now, while deferring maintenance to the future, when current office holders will be long gone. Greenfield development is climate arson, simple as that. Yes, the developments may have nice walking and bicycling paths within them, but travel to jobs, grocery stores, coffee shops, medical services, and really anything people want, requires driving a motor vehicle. As you well know, we already are not able to maintain our transportation system because most of the money goes to building more roadway capacity (particularly very expensive freeways and interchanges), not to maintenance. If what has already been built were maintained to high standards, your tax rate would be about half your income.

The answer is residential infill. That does take some investment. Some utilities may need to be upgraded. We may need to spend more on transit. But the costs are far far lower over the life of the development than is greenfield development.

Some recent articles and research on the different costs of infill and greenfield, but if you search online, you will find almost unlimited references, with a few that come to other conclusions.

celebration, and caution

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Today is a day of celebration for housing and transportation in California, with the possibility of more to come in the next two days. Yay!

But I want to caution about the alignment of housing with transit. It seems like a no-brainer, right? As I’ve long said, you can’t have affordable housing without effective transit, and you can’t have effective transit without widely available affordable and other housing. The problem I’m concerned about is that most of our transit system is oriented to arterial roadways (the semi-high speed, many-lane roads that are also called stroads because they don’t function well as streets or roads, and also called traffic sewers). Or in the case of rail transit, often uses old railroad corridors or freeway medians that make housing development difficult and probably unwise.

Research indicates that people, particularly kids, who live near freeways and arterials have much higher rates of asthma, and many other health problems, and shorter lifespans. Is that where we want low income families and kids living?

Apart from freeways, most traffic crashes happen on arterial roadways, and particularly at intersections of arterial roadways, and freeway on-ramps an off-ramps. Is this the hazard we want for low income families and kids?

I don’t have an answer for this challenge, but I often think it would be better to upzone everywhere (the next increment of development), so that additional housing can be built in places with better air quality and lower traffic violence. Maybe we should be fixing the arterials first, before we build housing along them. Yes, that delays the benefit of easy transit access to housing, but good transit in a poor living environment is just not what I want to see.

Sac CAAP: more carbon-intense transportation and land use

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The City of Sacramento (and the county, and the region, and the state) have created a very carbon-intensive transportation system, focusing on moving motor vehicles (more and faster) over all other uses of the public right-of-way. It has also created a carbon-intensive land use pattern, by allowing and encouraging sprawling development that places everything further away, and makes motor vehicle travel the only reasonable option for many people to get from one place to another. Sprawl not only makes transportation less efficient, but uses more water and more electricity, reduces agricultural lands, and isolates people. Freeways and the arterial street network that supports them are far more expensive than other roadways, so most of our transportation budget goes to those two types. There is little left over for streets, and little left over for maintenance. But you know all that.

If the city is serious about reducing greenhouse gas emissions (GHGs), it would focus most of the Climate Action and Adaptation Plan on these issues. Transportation and land use, and housing in particular, cannot be separated from each other. They should not be separated in the plan. If we change our transportation system without changing land use and housing, we fail. If we change land use and housing without changing the transportation system, we fail. They must both be changed, healed from the harms of past city action or neglect, together. What the draft plan proposes to do is make minor changes to housing and minor changes to transportation, but sets low goals for both. And it uses enough vague language that it is not even clear that those low goals will be achieved. Most importantly, it does not commit the city to spending any money to fix problems and do better. What it is basically doing is kicking the can down the road, in case future versions of the city government happen to be more committed to change and innovation.

I encourage you to take a look at the plan (yes, it is long and hard to read), and then contact your city council member to express your concerns. I’ll likely be gone by 2045, so won’t see the outcome, but for many of you and your children, the meek action and underfunding that the plan proposes will make your world unlivable. Time for leadership is now!

Sac CAAP: affordable housing near transit

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The City of Sacramento’s Climate Action and Adaptation Plan (CAAP), preliminary draft, sets a goal, in the Measure E-5: Support Infill Growth section to “Enable the development of 8,700 new affordable by design units by 2040 within 0.25 mile of public transit…”. Sound good, but.

This is a low goal. The city already has a deficit of affordable housing, and has no plan for raising the necessary funds to build this affordable housing (it killed inclusionary zoning, and replaced it with a completely insufficient development impact fee, and the $100 Measure U contribution to the housing fund is on hold). The city’s Housing Element, required by RHNA, specifies that 16,769 units of ‘Extremely Low- and Very Low-Income, and Low Income’ housing are needed. While it it true that some affordable projects have been, and will be, developed without any city help, setting a goal of only half what is already needed is meek.

Location within 0.25 miles of transit is a mixed bag. While it is clearly a good that affordable housing is accessible to transit (otherwise it is not truly affordable under the housing+transportation analysis), past practice has been to locate affordable housing projects on arterial roadways, those sources of pollution and noise and traffic violence that families living in affordable housing should be protected against rather than exposed to. Unless the city is making a real commitment to redesigning these roadways to reduce VMT, reduce traffic violence, reduce air pollution, and emphasize active transportation and transit, it would be better to place affordable housing elsewhere. I don’t think that CAAP is making that commitment. A strong argument made by many housing advocates is that we should be encouraging affordable housing everywhere, not just along arterial roadways (also known as stroads).

more housing, less parking, part 2 central city SE

Dan Allison2 Comments

This is the second of the four quadrants of Sacramento central city, bounded by Capitol Ave on the north, Broadway on the south, 16th Street on the west, and Alhambra Blvd on the east.

Please see my previous post, more housing, less parking, for background information, and the southwest quadrant.

The graphic is below, but more useful will be the ArcGIS Online WebApp Sacramento parking & empty. Red is surface parking, orange is empty parcels.

The slideshow below shows many of the surface parking lots in this quadrant of the central city. It may include photos of parcels that contain a building but also have excess parking.

The next slideshow shows many of the empty lots in this quadrant of the central city.

It turns out that compiling the data, including parcels and photos, it quite time consuming, so the other two quadrants of the central city will be a while in coming, but I’ll be adding several posts about what I’ve learned, and the opportunities.

more housing, less parking

Dan Allison10 Comments

I have been gradually compiling data on two types of properties that could be developed into housing, or mixed use, removing unproductive uses such as surface parking and empty lots. The data at the moment is just the southwest portion of the Sacramento central city, bounded by Capitol Mall/Ave on the north, Broadway on the south, Sacramento River on the west, and 16th Street on the east.

I am not claiming high accuracy. The polygons are parcels from the Sacramento County parcel layer, selected using ArcGIS Imagery basemap, with consultations to Google Maps and Google Earth (the historical imagery allows selection of views without leaves on the trees, making it much easier to see what is on a parcel). I am sure I have missed some parcels, and included some that should not be. Nevertheless, I think the pattern is worth thinking about. Parcels that contain significant parking but also contain a building are not included, though obviously when counting parking, it is important. And, the map does not include street parking or structured parking. If those were included, the map would be a mass of red. There is a remarkable amount of structured parking (often called parking decks), both freestanding, and layered into other buildings.

I have not distinguished who owns these parcels. Probably about half the parking is owned by the state, and the rest by private parking companies. Of the empty parcels, it is less clear, but there is a mix of public (state and city) and private. It would take a great deal of time to determine ownership in order to code these differently. Maybe in the future, but I’m not sure this is a significant issue.

The graphic is below, but more useful will be the ArcGIS Online WebApp Sacramento parking & empty. This is my first experiment with presenting information through a WebApp map, but I realized that people would otherwise be ruining their eyes trying to parse out the polygons of surface parking and empty lots in the static map. Red is surface parking, orange is empty parcels.

So, why the data compilation. There are a significant number of empty parcels in the central city, all of which could be housing instead of empty. And every surface parking lot could be and should be developed into a more productive use. By productive, I mean something of direct use to humans instead of cars, and more productive of sales tax and property tax. Our property tax system values empty lots and parking lots are virtually zero, meaning they contribute little to our tax base needed to provide services. I’ll say more about this shortly.

The slideshow below shows many of the surface parking lots in the southwest quadrant of the central city. It may include photos of parcels that contain a building but also have excess parking.

The next slideshow shows many of the empty lots in the southwest quadrant of the central city.

parking instead of housing

Dan Allison2 Comments

I am working on a project to find some of the land in the central city that could be housing instead of empty land, or surface parking lots. To me, every surface parking lot is a crime against the climate because it spreads out housing and other amenities to the point where driving becomes preferred if not necessary. But while comparing the county parcel map to the current land use, I was struck by what a sad, sad loss of housing there has been, particularly in the downtown section of the central city. To highlight this, I picked a block very close to where I live, the block bounded by P Street, Q Street, 11th Street, and 12th Street. On this entire block, there is one temporary building, a state child care center, and a small power facility related to the SacRT light rail tracks on 12th Street.

The image below shows the county parcels, labeled with addresses, overlaid on up-to-date ESRI Imagery layer. The child care building is in the lower right corner, at the intersection of 12th Street and P Street, and the SacRT facility is on the unlabeled square on 12th Street. The entire remainder of the block is parking. Some of the parking is state-owned, some privately owned. Every single one of these parcels at one time had either housing or business, or both, though there is some indication that the northwest corner large lot may have been a gas station for a period of time.

Sacramento parcels overlaid on imagery, P Street to Q Street, and 11th Street to 12th Street

I first looked at Google Earth historical imagery, but the only fact from that is that in 1993 all of the block had been converted to parking, and the child care center was probably there (the photo is fuzzy). Then I looked through Center for Sacramento History photos. I have only started through the archive, but did find some photos of the block or nearby blocks. One things that surprised me is that in the early 1950s homes were already being torn down to build state buildings. The photo below shows 1116, 1118, and 1124 P Street in 1949. If I’m able to get a better image, I will replace this one. It shows what seems to be typical of housing in this area, single-family and multi-family mixed in.

The Sacramento Redevelopment Agency was established by 1951, and its mission was to remove all housing that didn’t meet its standards, which meant all housing occupied by lower income and people of color, centering on Japantown.

CADA (Capitol Area Development Authority) was established in 1978 to save what little was left of housing in downtown, so it is probable that the housing had been torn down by the state or city well prior to that. If so, that means that this block has been a parking lot for at least 43 years. Probably much longer, perhaps back into the 1950s. What used to be homes and businesses, has been essentially worthless for that entire time. So, so sad.

For more info on the destruction of downtown, I recommend any books by local author Bill Burg (in local bookstores for paper copies or on Amazon for Kindle copies). You can also find a number of papers and research documents on the Internet by searching ‘Sacramento redevelopment’. I have hardly scratched the surface.

There are several entire blocks of parking in downtown, and many, many blocks that are mostly parking. What a waste!

I ask that the state transfer all surface parking lots under its control to CADA. The state has as many office buildings as it will ever need, but there is no housing to support the office workers, and particularly the lower income maintenance workers that support these office buildings. More to come on that idea.

I welcome historians, particularly Bill Burg, to correct or amplify my information.

No more pure office buildings downtown

Dan Allison1 Comment

The state is building several new office buildings downtown. Close to where I live, the former building at O St and 12th is gone, and will be replaced with a modern office building, and the block between O and P and 7th and 8th is seeing a new building. There are others planned, and there is a plethora of state-owned surface parking lots (a travesty of land use if ever there was one) that could be developed.

It is good, in a sense, to see the state aggregating scattered offices into more centralized locations. But what is not good is that the state is not building any housing to go with the offices. So most employees will still be driving in from the suburbs, creating air pollution and rush hour congestion in the process, while contributing nothing to life in the central city. Almost every new building, whether public or private, has some retail, at least a corner and sometimes the whole ground floor. But integrated housing and office is rare.

So, my modest proposal (in the Swiftian sense) is that every office building of one-quarter block or larger include housing for at least one-quarter of the employees of the building. Not just the daytime office drones, but the maintenance staff as well. Some percentage should be required affordable, probably 20% to cover the lower income maintenance and clerical staff. I am not saying the the residences should be limited to employees of the building, I’d leave it up to each building manager how they wanted to allocate housing.

I have mixed feelings about whether this should be required of private developments. Certainly there should be codes and city support for accomplishing the same objective in private development, but requirements, not so sure. But state owned buildings, yes, absolutely, every one of them.

I lived in midtown, close to the downtown boarder, for seven years, and have now lived in downtown, near the midtown border, for just under a year. I moved all of five blocks. These two places might as well be in different cities. Downtown is dead, dead, dead at night and on weekends, whereas midtown is alive weekdays, evenings, and weekends. The difference? I think it is primarily the lack of housing in downtown. Office towers do not make for a livable, walkable place.