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Plotting a Course for the Next Generation of Growth

William Fulton is president of Solimar Research Group, Inc., and a council member for the City of Ventura. He is the author of several landmark books on land use and cities, including Guide to California Planning, The Reluctant Metropolis and The Regional City. Fulton can be reached at bfulton@solimar.org.

Here’s one of the most amazing facts I’ve ever heard: California has been adding more than 1,000 people to the state’s population every day for almost 70 years.

We tend to take California’s growth for granted, but it’s worth taking a step back to appreciate its breathtaking scale. At the beginning of World War II, California had a population of 6 million people - about the same as present-day Arizona or Washington. Today, the state is pushing 40 million people, making it about the same size as present-day Spain or Argen tina and bigger than Canada.

This is perhaps the most sustained level of population growth in the history of the industrialized world, and it is not likely to slow down anytime soon. Despite cost and crowding, California remains an at tractive place to live, work and make a life. We are likely to see 1,000 or more new residents every day for the foreseeable future, and the state’s population could hit 50 million in another genera tion or so.

Most of these additional people - along with their jobs and stores and houses and cars and parks and schools - will be located inside our cities. How will California and its cities deal with yet another generation of massive growth?

As demographer Dowell Myers of the University of Southern California likes to say, there’s always a temptation to think that the future will be the same as the present - only bigger. But the future isn’t really bigger than the present - it’s different. And that’s how California has to approach the next generation of growth: by recognizing that it will be different from the growth of the past and approaching it in another way.

Adapting to Change

In the vast post-war growth boom, California planned for the future by raising taxes, issuing bonds and investing in well-planned expansions of highways, schools and colleges, and water infrastructure. The goal was to create a primarily suburban society where most people lived in single-family homes that surrounded the metro areas, all of which were being fueled by postwar middle-class prosperity. The "design capacity" for this system was around 20 million people. Once the population pushed past that level (which occurred around 1980), everything began to feel crowded, and the system showed signs of strain.

Now we’re close to the breaking point. We need to redesign California to accom modate 50 million or perhaps even 60 million people. And we’re going to have to do it in a new world; one that’s not just bigger than today’s world but different. The components of population growth are different, the nature of our economy is different and so are the fiscal resources available to deal with growth. Perhaps most important, the environ mental challenge is also different - and more overwhelming than any environmental challenge we have ever faced.

So the solution will have to be different as well: more urban, more cutting-edge and yet still provide ways for upwardly mobile families to realize the California dream.

Looking at the Impacts of Demographic Shifts

Over the past three decades we have witnessed the most profound demographic change since the Gold Rush: the shift from a predominantly Caucasian state to one without a racial or ethnic majority. Since 1980, the white population has quite literally stayed the same at about 16 million, while the Latino and Asian populations have tripled. This shift has occurred only partly because white families have had fewer children and moved to other states more frequently. The other factors are that Asian and especially Latino families have emigrated to California from other countries in unprecedented numbers, both legally and illegally, and they have had larger families.

All this change, however, is really only a warm-up for the main event: the massive entrance of the "Latino Baby Boom" of the 1980s and ’90s into the workforce during the next decade or so.

The emerging Latino population is becoming the backbone of California’s economy, and its members are showing signs of classic upwardly mobile aspira tions. In recent years, young Latinos have gone to college in record numbers. They have provided a stable market for starter homes, both in the suburbs and in urban areas previously viewed as hostile to families. They have voted overwhelmingly for taxes and bonds to build roads and schools and create jobs - the quintes sential vehicles of upward mobility familiar to anybody who grew up in post-war California.

These trends will only accelerate during the years ahead. Over the next decade, the Latino baby boomers will grow up. They will flood our colleges and provide a huge new workforce. (Asian baby boomers will be coming too, but they will be fewer in number.) And they will want to buy houses. Between now and 2020, the millions of young Latino home-buying families will fuel a vast amount of new residential development, both suburban and infill.

Pursuing the Dream

Some will choose the traditional California dream of owning a single-family home, particularly in the Central Valley, meaning there will be tremendous sprawl pressure. But many will also choose to live in infill locations, closer to jobs, churches and families. This will put enormous development pressure on older suburbs - especially in the Bay Area, Los Angeles, Orange County and San Diego, which together still account for most of the state’s economic activity and 40 percent of its population growth.

So in the California of the future, there will be no such thing as a "built-out" suburb. Someone will always be knocking on the door of every city in our state, wanting to get in. All older cities have to be ready to deal with this new reality, and so will state law. Currently, state environmental policies - including the California Environmental Quality Act and practices associated with environmental justice - often require just as much analysis and review for infill projects in existing urban areas as for brand-new subdivisions out in the country (see "Looking at Infill-Related Issues" at right). It’s pretty clear that something will have to give in order for California to accept the amount of infill development that will be required over the next 10 to 20 years.

Investing in Infrastructure

Younger California residents are also likely to vote in ever-greater numbers for public investments that they believe will help them get ahead. For two decades after the passage of Proposition 13 (from the late 1970s until the late ’90s), infrastructure investment in California was at a post-war low. During the past decade, this has started to turn around. School bonds, park bonds, housing bonds, road bonds, as well as many taxes have passed with greater frequency at both the state and local level. The most recent example, of course, was the passage of $43 billion in infrastructure bonds on last November’s ballot (see "How Hard Is It to Get Voter Approval?" at left).

There are many reasons why infrastructure investment is popular nowadays. One is the general increase in prosperity in California over the last decade. Although this prosperity hasn’t always been distributed evenly, it has provided voters with a general sense of well-being that has encouraged them to vote in favor of bonds. Even more important, however, is the increasing voter participation rates of Latinos, especially in the Los Angeles area, who sometimes make the difference between passage and failure of bonds, especially at the local level where bonds require a two-thirds vote.

The result of this major shift in voter attitudes is that California has more money to spend on infrastructure today than at any time since the Governor Pat Brown era in the 1960s. This is why California and its cities now have the opportunity to methodically redesign the state so that it can accommodate future growth more comfortably, rather than continuing to groan under an antiquated suburban model.

The state bonds passed last November - primarily for transportation, housing, flood control and open space - contain several small but significant pots of money that could influence the state’s growth pattern. For example, the park bond has $90 million for planning. The housing bond designates $300 million for transit-oriented development and $850 million for infill development incentives. Future bond issues - which I believe will pass for the reasons described here - are likely to contain much more money for these activities.

Properly deployed, the bond money can alter the nature of urban development in California so that its cities can sustainably handle more population growth and economic activity for decades to come. In the larger metro areas, there will be more transit lines and more high-density development focused around them. In small cities and rural areas, there will be more open space preserved and more new communities built on a village or "New Urbanist" model. We will see many local development fights around the state on the specifics of such projects, but California cannot thrive during the decades ahead without adopting a different growth pattern. Both the state and its cities must gradually embrace a new and more urban alternative.

Nor can California thrive without addressing head-on the toughest environmental question of all: how to deal with our changing climate.

The Impact of Global Warming

There is no question that global warming will drive most of our environmental policies in the future. Both the state and California’s cities will have to deal with two different questions. Both are important and overwhelming. The first is how to reduce greenhouse gas emissions. The second is how to adapt to a world with a different climate.

The state has already adopted AB 32, which creates a statewide cap on greenhouse gas emissions in 2012 and ratchets that cap downward significantly by 2020. Although this law is focused mostly on technological breakthroughs that will cut emissions, Gov. Schwarzenegger’s Climate Action Plan assumes that 12 percent of the reduction required to meet the law’s target will come through changes in land-use patterns. This can’t and won’t happen unless cities and the state work together to create a new growth pattern that allows people to live their daily lives without using their cars so much.

Even more intimidating than slowing greenhouse gas emissions, however, is preparing for the changes that are likely to occur because of global warming, which now appears inevitable. Coastal communities will have to consider whether rising sea levels will flood some of their priciest real estate. Inland cities - especially in the Central Valley - will have the same concern, thus increasing the pressure for better flood control. They will also have to deal with rising temperatures in their communities, which might become uninhabitable if it’s 120 degrees most of the summer. And if the Sierra snow pack is lighter because of warmer temperatures, more surface reservoirs must be built throughout the state to store the diminishing water supply.

Finding New Ways to Thrive

In other words, simply maintaining California as is - always a monumental and expensive task anyway - would take far more effort and cost far more money in the future. But we have to find a way for California to thrive in a more sustainable way economically and environmentally, all while adding millions more people and houses and jobs and cars.

That’s why we need to rethink how California grows, not just keep doing more of the same thing. This is not a task for the fainthearted, but Californians and their cities have a long history of knowing how to rise to this kind of challenge. It’s time to begin the discussion.

 

Looking at Infill-Related Issues

by Bill Higgins

Bill Higgins is a legislative representative for the League. He can be reached at <higginsb@cacities.org>.

 

There are numerous challenges associated with infill development:

  • It’s more difficult to finance;
  • There are pre-existing conditions, such as deteriorated infrastructure and brownfields, that must be remedied; and
  • Community concerns about traffic, noise, pollution, crime, school quality and other issues must be addressed.

These community concerns related to the impacts of infill development on existing neighborhoods are driving the growing environmental justice movement. As California’s growth becomes more concentrated within its urban areas, better ways must be developed to mitigate the impacts of development on families whose neighborhoods are being transformed and address their concerns. (This issue will be explored in greater depth in a subsequent installment of this series.)

The California Environmental Quality Act (CEQA) is the traditional tool used to identify and analyze the impacts of development projects. CEQA’s intent is to ensure policy-makers have comprehensive information on which to base decisions. Negotiating the CEQA process, however, can be complicated. Developers often view it as an impediment to project development in infill locations. But while CEQA requires an analysis of a project’s environmental impacts, it does not prohibit a local government’s ability to approve development.

CEQA can delay project adoption and offer opportunities for litigation. Certainly it’s a factor in infill development. However, it is generally dwarfed by the limitations on local governments’ ability to raise the necessary revenue (which often requires a two-thirds vote) to upgrade the streets, sewers, water supplies, parking, parks and other infrastructure to serve increased levels of density.

The main tool for infrastructure development within urban cores remains local redevelopment agencies. These agencies, which depend on tax increment financing to remove urban blight, upgrade and repair infrastructure, and provide affordable housing, have accomplished impressive feats. But if California is really going to shift from its traditional suburban pattern of growth to much more urban forms, the fiscal tools available for expanding urban infrastructure must also be significantly expanded.

How Hard Is It to Get Voter Approval?

by Dan Carrigg

Dan Carrigg is legislative director for the League. He can be reached at carriggd@cacities.org.

 

When comparing state and local approval rates for infrastructure measures, it’s important to focus on California’s various voter thresholds, which resulted from several initiatives approved in recent decades. City and county "special taxes" require a two-thirds vote, local school bonds require 55 percent, and all state bond measures require a simple majority. These varying voter thresholds have had a real impact on California, forcing local governments to rely much more on developer fees, state bonds and other funds for needed infrastructure. At the same time, the state has had many recent budget challenges and is nearing its debt capacity.

An analysis of the election results for the infrastructure bonds package in the November 2006 General Election yields some interesting facts. A majority vote was required for these state measures to pass. If the two-thirds vote (66.66 percent) threshold had been applied to these proposals, all of them except Proposition 1A would have failed. While Prop. 1A passed with 77 percent of the vote, Prop. 1B garnered 61.4 percent and Prop. 1E got 64.2 percent, the other measures in the package received only 57.8 percent (Prop. 1C), 56.9 percent (Prop. 1D) and 53.8 percent (Prop. 84).

Local Revenue Measures, November 2006 Election

Results for local revenue measures in the same election (November 2006) clearly show that it is much easier to get a simple majority approval than a two-thirds approval:

  • Local general taxes (requiring a majority vote) - 33 out of 48 passed (69 percent);
  • Local school bonds (requiring a 55 percent majority) - 55 out of 67 passed (82 percent); and
  • Local special taxes (requiring a two-thirds majority) - 44 out of 89 passed (49 percent).**

**The local special taxes data include cities, counties, special districts and some school measures. Some school measures do not qualify for the 55 percent vote threshold and require a two-thirds vote, because they are for operations (not facilities) or are too big.