Tech Villas-Not Your Old Company Towns

Scotia a company town
Pacific Lumber Mill company town of Scotia, CA, called “The Last Company Town.”

Nobody likes to pay almost half of one’s wages for housing, but that is what is happening to so many California residents. Reasons for the astronomical housing costs vary according to whom one asks. However, regardless of reason, the situation is now promoted as a “crisis,” and duly exploited as such.

Of concern to the Just Vote No Blog is that the housing crisis is at the heart of today’s central planning, which renders residents and voters increasingly powerless in land use and housing decisions.

A Brief Background

In The Curious Case of Housing Legislation, the Just Vote No Blog noted the history behind today’s network of housing bills. The state’s evolving efforts to remove land use and housing decisions from voters is one of the evident aspects of such history. Here are some reminders:

The seminal Assembly Bill 32, The Global Warming Solutions Act of 2006, started the ball rolling by mandating the reduction of the state’s greenhouse gas emissions to 1990 levels by 2020 and to 80 percent below 1990 levels by 2050.

Climate crisis soon morphed into a land use crisis that required dense job/housing development along narrow corridors throughout the Bay Area, ostensibly to cut down on greenhouse gas emissions produced by workers commuting from homes in the suburbs.

Predictable pushback from neighborhoods, cities and counties not wanting to lose their chosen quality of life encouraged increasingly stronger state mandates. SB 330 and AB 1487 are the latest high-profile bills bent on removing housing decisions from cities and counties.

SB 330, the Housing Crisis Act of 2019, introduced in February by Senator Nancy Skinner and approved by the legislature September 6, has the general objective to “prohibit a county or city, including the electorate exercising its local initiative or referendum power, in which specified conditions exist, determined by the Department of Housing and Community Development as provided, from enacting a development policy, standard, or condition, as defined…..”  Thus, the electorate is summarily dismissed.

AB 1487, the San Francisco Bay Area Regional Housing Finance Act of 2019, introduced in February by Assembly Member David Chiu is currently active and in desk process.  This bill is a game changer.  Voters, no matter how disempowered by mandates such as SB 330, at present can still vote down tax proposals that finance mandates they do not like. AB 1487 makes that strategy more difficult. This bill establishes a new agency, the Bay Area Housing Finance Authority, run by bureaucrats removed from the wrath of voters, with the power to place tax proposals on region-wide ballots, and to determine pass/fail on an aggregate region-wide basis.

Progression Towards Powerful Public-Private Partnerships

The plethora of housing bills in the style of SB 330 and AB 1487 passed into law during the past few years calls for a good deal of cash, perhaps more than the creative financing that could be achieved by the Housing Finance Authority would be able to raise on its own. Thus, enter powerful private players interested in housing development for reasons of their own, willing to forge partnerships with public entities. As one would expect, tech companies like Google and Facebook are becoming major players.

Google, Facebook and other deep-pocketed tech companies are at present investing in housing, a dream come true for housing advocates. They are also encouraging the California legislature to pass legislation that will streamline housing production (more on this later), since investors do not like lengthy bickering over what or where housing is built.

Of course, private influence in public affairs is nothing new. Neither is privately-funded housing developed with government blessings — company towns like Hershey, Marktown, and Pullman are examples. However, today California is witnessing not just tech-towns developed for tech workers, but also the much broader endeavor of using tech money to fund housing for the general population.

Recommended Articles on Public-Private Partnerships

A San Francisco Bay Area publication, 48 Hills, has been deeply concerned about the waning power of voters in land use, housing and transportation decisions. A series of articles by researcher and journalist Zelda Bronstein, published in 48 Hills, explains in great detail how a private entity, the Chan Zuckerberg Initiative, is poised to affect housing policy. In the first two installments published May 29, 2019 and August 29, 2019 of the series (there might be more to come), Ms. Bronstein zeroes in on Senate Bill 330 and Assembly Bill 1487.

The articles are rich with information that Bay Area residents will find useful in understanding who is becoming in charge of their neighborhoods.

Here is a brief description of the Chan Zuckerberg Initiative and its related entities followed by very brief highlights of Ms Bronstein’s articles.

The Chan Zuckerberg Initiative

The Chan Zuckerberg Initiative, established in 2015, is a limited liability company founded by Dr. Pricilla Chan and her husband Facebook CEO Mark Zuckerberg. The initiative is funded by a life-time pledge of 99% of Mark Zuckerberg’s Facebook shares.

Its mission is to support education, justice & opportunity, and science. The justice & opportunity initiative focuses on criminal justice reform, housing affordability, and immigration reform.

The initiatives are accomplished through grants and ventures, technology, and advocacy and movement capacity. Advocacy and movement capacity includes “supporting community-led efforts to shape policies, or ballot measures and state legislative reforms.”

Partnership for the Bay’s Future

In January 2019, the Chan Zuckerberg Initiative helped launch Partnership for the Bay’s Future, a public-private partnership focused on housing development.

The partnership is supported by the Chan Zuckerberg Initiative, San Francisco Foundation, the Ford Foundation, Local Initiatives Support Corporation (LISC), Facebook, Genentech, Kaiser Permanente, the William and Flora Hewlett Foundation, the David and Lucile Packard Foundation, the Stupski Foundation, and Silicon Valley Community Foundation.

Partnership for the Bay’s Future uses two principal venues for its work. The Investment Fund makes available loans and other financial tools to facilitate housing production. The Policy Fund helps create public policy, as described in the Partnership’s website:

The Policy Fund will support local jurisdictions in passing and implementing policies that will protect tenants and preserve and produce housing. The Fund will use the policies vetted in the CASA (Committee to House the Bay Area) process as a menu of possibilities for jurisdictions to propose in their applications for funding.

The Downside

At first blush the missions of the Chan Zuckerberg Initiative and Partnership for the Bay’s Future look like good, altruistic endeavors. But Zelda Bronstein has taken a deeper look. Ms. Bronstein notes the layers upon layers of related and cooperating entities taking action sub rosa. Residents and taxpayers will be affected by such actions, but take no meaningful part in them.

Summary of Article 1: Facebook Money and California Housing, by Zelda Bronstein

* Grants support the same present policies that have inflated land values, boosted rents, and forced lower-income residents out of the Bay Area.
* The CZI is a limited liability company, not a traditional non-profit organization; therefore, it can freely engage in political influence.
* Although CZI is on paper a separate entity from Facebook, this separation “may be a distinction without a difference.” Facebook’s bigness and concentrated power is “inimical to democracy.”
* The support of CZI and related entities support for SB 330 and AB 1487 proves worrisome. The tenant protection claims of SB 330 are too flimsy to be of value to those at risk of displacement.
* Also worrisome is CZI grantees’ common connection to CASA. This Committee to House the Bay Area was established by the Metropolitan Transportation Commission, is composed of a number of “stakeholders” interested in housing development, and operates out of voters’ reach. Stakeholders of CASA include “Big Tech, Big Philanthropy, and Big Real Estate Capital.”
* One of CASA’s objectives is to promote legislation enabling CASA’s mission, and SB 330 is a direct result.
* “What’s new is the marketeers’ attack on local democracy – specifically, on local governance and land use; the professoriat’s aggressive participation in and legitimation of that offensive; its facilitation by state officials; and the tech sector’s unapologetic supporting role in the onslaught.”

Summary of Article 2: Facebook Money Pushes Chiu Housing Bill, by Zelda Bronstein

* As SB 330, AB 1487 carries out the edicts of CASA. And as SB 330, AB 1487 has the backing of CZI, via a $500,000 grant to Enterprise Community Partners, a major player in the housing arena.

* “At the July 10 hearing, Enterprise Community Partners staffer Geeta Rao, speaking in support of the measure [AB 1487], brandished an ECP report that she had co-authored, The Elephant in the Region: Charting a Path for Bay Area Metro to Lead a Bold Regional Housing Agenda.”

* “That document and Enterprise’s other efforts in behalf of a regional housing entity make explicit what every version of AB 1487 has left implicit: The pro-growth regime sees the bill as an opportunity to,
— Decimate Bay Area cities’ authority over land use.
— Penalize cities for failing to do what cities don’t do anyway —build housing.
— Aggrandize the monied rogue Metropolitan Transportation Commission.
— Facilitate the private appropriation and exploitation of the region’s public land.
— Put the region’s most vulnerable tenants at greater risk of displacement.
— Succor the private housing industrial complex; and
— Promote an improvident pro-growth agenda.”

* Also addressed by Enterprise Community Partners are the financial benefits of building on public land. So, the plan of action must be “to take steps to ensure that cities surrender their land, an irreplaceable asset, to the private housing industry.”

* “In authorizing MTC and ABAG to levy Bay Area wide revenue measures, AB 1487 would bestow (ABAG) or expand (MTC) taxing authority on officials who have no direct accountability to the prospective taxpayers.”

* “Of course SB 330, AB 1487, and the other destructive measures conceived in the CASA Compact, including key aspects of SB 50, need to be vigorously opposed. But the finer points of the legislation are going to be lost on the general public. The public, however, is perfectly capable of grasping the dangers of a secretive cabal generously funded by Facebook money.”

* “And in the best tradition of political jiu jitsu, make it clear that in the CASA Compact, the 3 Ps really stand for Profit, Profit, and Profit.” [CASA’s Three Ps are: Production, Preservation, and Protection].

Just Vote No Blog Thoughts on the Matter

The Just Vote No Blog has been following the march towards the Governor’s desk of bills such as SB 330 and AB 1487.  Housing bills seem to be increasing in numbers and clever aggressiveness. Zelda Bronstein is correct that the average resident, journalist, or blogger is having a difficult time reading and taking action on specific bills, and a more effective approach is to try to communicate with voters the roots of the bills, which at present is CASA.