State requirements for local plan preparation can take many forms. California has gone the furthest of any state to direct its communities to provide for the development of affordable housing. Both California and New Jersey work from a fair-share concept, that is: each community must absorb its fair share of the burden of affordable housing (Cowan 2006).

It is not surprising that California would lead in this area. California is a very large state; its population is approximately one-eighth of the population of the entire nation and its pace of population growth consistently outpaces the pace of growth of the USA. California is also known as a state where exclusionary zoning is practised by many communities, choking off the supply of new developable land despite strong demand for additional housing (Glaeser et al. 2005). With the supply of land restricted, communities have created an ongoing shortage. With the ongoing growth in demand, the prices of homes in California have been bid up to some of the very highest prices in the USA. These high prices have made affordability problems commonplace; the incidence of households allocating more than 30 % of income to housing is higher than the US average.

By state law, Californian communities must have a housing element (a component or chapter) within its comprehensive plan. California's General Plan Law requires that all localities adopt a general plan containing various mandatory elements and that the municipality’s zoning and subdivision ordinances be consistent with the general plan. The housing element must be certified by the state Department of Housing and Community Development, but broad discretion is given to the local government in preparing the housing element. The method by which the community provides for affordable housing is left to each community. To be certified, the element must make adequate provision for the existing and projected needs of all segments of the community, including those of low income. A 1980 amendment provided that each locality creates policies and programmes to enable it to meet its regional fair share of regional low-income housing needs.

However, the Housing Element Law did not require local governments to build affordable housing, requiring only that the housing elements of local plans comply with state law rather than ensuring that sufficient housing was constructed (Fulton 1991). Even so, in the first five years of the state’s required fair-share housing element procedure, over 2000 affordable units were built, another 2000 were under construction with over 7000 in planning stages (Calavita et al. 1997). It was estimated that between 1999 and 2006, a total of 29,281 affordable housing units were created through inclusionary programmes across at least 81 municipalities, primarily in the San Francisco Bay area, southern California and the Sacramento region (Calavita et al. 2010, p. 48). By 2014, an estimated 145 municipalities (around 25 % of the state) had inclusionary schemes in place (Wiener and Barton 2014).

Illustration 6.2 Residential apartments, San Francisco. San Francisco, California, has a long-standing inclusionary zoning programme.

(Source: Nicole Gurran 2011)

The Californian approach continues to be shaped by state and local politics, with more conservative state administrations supporting communities who oppose development of affordable housing and more liberal administrations supporting the notion of fair-share development of affordable housing across all communities (Calavita et al. 1997; Calavita et al. 2010). As noted earlier, a wave of litigation against inclusionary schemes in California since 2006 (Wiener and Barton 2014) has led to the growing adoption of ‘impact fees’ as a means of securing affordable housing contributions during the development process.

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