Is Gavin Newsom’s housing policy ‘rudderless’? Advocates want more done to lower California costs

In his first 10 months in office, Gov. Gavin Newsom approved $1.75 billion in new spending on housing programs and helped pass new laws to prevent evictions and rent spikes.

Despite those actions, permitting of new homes has slowed since Newsom became governor.

Many housing advocates say that’s not his fault, that he hasn’t been governor long enough for current permitting rates to be the result of his policies and actions.

They’ve praised the work Newsom has done so far, but some advocates say he needs more homebuilding expertise in his cabinet and a top adviser who can spearhead the his housing agenda.

California Housing Partnership President Matt Schwartz pointed to Newsom’s recent appointment of an energy czar to develop plans to make the state’s utilities safer and financially stable.

“The state’s energy and wildfire situation is clearly worthy of a special czar appointee. So is the state’s housing crisis,” said Schwartz, whose group advocates for low-income housing developers. “The state is somewhat rudderless right now with respect to its housing policy because there is no one in the cabinet with extensive housing experience.”

Newsom argues he’s already effectively done that. In an interview earlier this month with the Fresno Bee editorial board, he said his senior aide Jason Elliott is his “de facto” housing czar. Elliott was instrumental in convincing tech companies to spend billions on California housing, Newsom said.

“We just got $2.5 billion from Apple because we asked,” Newsom said. “It was actually done with precision to align with the state’s strategies.”

Elliott spent nearly a decade as a top aide to San Francisco mayors, often working on housing and homelessness at the local level.

Now, as one of Newsom’s top policy advisers, his broad portfolio includes climate change, environment and infrastructure, in addition to housing. But Elliott said housing is a top priority for him because sky-high rents and home prices are perhaps the biggest factor making California such an expensive place to live.

“One of the important goals we had is to bring the housing conversation to the foreground. I think we’ve accomplished that,” Elliott said. “Now the question becomes how do we attach solutions to the problem? We started this year, but we have more to do.”

Within Newsom’s official cabinet, Alexis Podesta serves as secretary of the Business, Consumer Services and Housing Agency, which oversees the state’s Housing and Community Development department.

She was appointed to the job by then-Gov. Jerry Brown in 2017 after serving in various positions in the governor’s office and working for U.S. Sen Dianne Feinstein and Pacific Gas and Electric. The Housing and Community Development department’s top job is vacant, but Newsom says he’s working to appoint someone.

Newsom told the Fresno Bee editorial board that Health and Human Services Secretary Mark Ghaly is effectively his homelessness czar, a position he promised to appoint during his campaign. That’s a change from what Newsom said in August, when he said his homelessness advisers Sacramento Mayor Darrell Steinberg and Los Angeles County Supervisor Mark Ridley-Thomas were the de facto czars.

Newsom won the governor’s office campaigning on an ambitious pledge to build 3.5 million new housing units in seven years to address an affordable housing crisis. The state would need to dramatically increase homebuilding to reach that number.

Roughly 81,000 permits were issued in the first nine months of this year, down 10 percent from 2018, according to the Legislative Analyst’s office. To reach Newsom’s goal, the state needs to build 500,000 homes per year.

Newsom has helped pass laws to limit cities’ ability to restrict new construction, protect renters from evictions, and limit rent spikes. He included $1.75 billion in his first budget to boost housing construction through grants, loans and tax credits.

Amie Fishman, executive director of the Non-Profit Housing Association of Northern California, praised the governor’s actions this year on housing, but said Newsom’s office now needs a specific housing leader.

“The priority was to get new resources and new policies passed,” Fishman said. “Now the urgency is to make sure those resources and policies are maximized to have the impact that Californians need.”

Newsom’s work pushing for more housing money and tenant protection bills has been a big improvement over Brown’s, said Rob Wiener of the California Coalition for Rural Housing, which represents rural developers.

“If you compare Gavin Newsom to Jerry Brown, it’s night and day… but if you compare Gavin Newsom to candidate Gavin Newsom, there’s some disappointment,” Wiener said. “Newsom promised a Marshall Plan for housing and bold action, and we haven’t really seen either one of those.”

Some argue specific policies aren’t working as effectively as Newsom suggested they would.

The state’s policies aimed at withholding money from cities and counties that aren’t building enough housing are actually hurting developers, not local governments, Schwartz said. And under Newsom, the state’s affordable housing tax credit program is prioritizing lower-cost housing as opposed to building housing in areas where there is greater need but higher building costs, Fishman said.

“There does seem to be a vacuum of leadership at the top,” Wiener said. “There seems to be a lack of a coherent strategy to address the housing crisis. Right now, the approaches are mostly piecemeal, sporadic and not terribly focused.”

Others, like Matthew Lewis at California YIMBY, argue Newsom deserves credit for taking leadership on the housing crisis and making it a top policy priority. Lewis credited Newsom for helping steer legislation to help homeowners build second and third units on their properties and other high-priority bills for California YIMBY, a group that advocates for increased housing production largely funded by philanthropies and tech executives.

He said next year he hopes Newsom pushes for Senate Bill 50, a bill that would dramatically increase housing density by allowing more apartment complexes and multi-unit buildings on land previously reserved for single-family homes.

“As advocates, we always would hope he does more,” Lewis said. “So far, I think we would say, ‘Thank you, and we’re not going to relieve the pressure, because we need your help.’”

This story was originally published November 18, 2019 at 5:00 AM with the headline "Is Gavin Newsom’s housing policy ‘rudderless’? Advocates want more done to lower California costs."