☆ Libertarian detangles SJ housing market’s biggest blunders
Silicon Valley Taxpayers Association president Mark Hinkle examines zoning laws, construction codes, and permit fees as three key hindrances to a thriving San Jose housing market. An Opp Now exclusive.
Opportunity Now: What's the most intrusive thing city governments do that constrain locals’ freedom?
Mark Hinkle: I’d have to point to local zoning laws, construction codes, and permit fees. My wife is an architect, and I’m in the construction field, so I’m quite familiar with these issues.
To begin, zoning laws restrict where units can be built. If you look back in history, early zoning laws were primarily racially motivated. This term emerged, “white flight,” that designated how white people frequently moved out of their neighborhoods when poor, black, and Hispanic people moved in. To try and prevent this, local governments created zoning laws to exclude the racially and socioeconomically undesired residents from dwelling in certain areas. For instance, lots of the Willow Glen area in San Jose is single family housing only. Who can afford single family housing? Not poor people. Like it or not, those were the origins of zoning codes.
When I was growing up, I spent a year in Lordsburg, New Mexico. Unlike in California, all Mexican residents lived on one side of the river tracks, all black and white residents on the other side. Total segregation. This was a shock to me because I thought the Civil War ended segregation. Unfortunately, restrictive zoning laws have perpetuated it in certain places like Lordsburg.
ON: So it sounds like zoning laws were intended for harmful purposes at the beginning — and that even today, you see them as unnecessary and unhelpful for the local market.
What about construction codes?
MH: Construction codes — all controlled by local and state governments — unnecessarily add to the cost of construction.
Some people propose ideas like mandating the city approves a certain percentage of low-income housing. However, from a Libertarian standpoint, such mandates are pointlessly trying to fix problems caused by the city. Rather than creating a new mandate or law, the government should get rid of these permitting fees and construction codes. After all, low-income and high-income housing still cost the same amount of money to build.
Also, as an interesting note, even the progressive city of Palo Alto doesn’t want affordable housing in their neighborhoods. Palo Alto’s city council wanted to take two acres of land and create a low-income senior housing unit. However, local residents gathered signatures, put it on the ballot, and defeated it. This is an example of the idea of NIMBY (not in my backyard). Everybody is for affordable housing, as long as it’s not next door to them.
ON: Finally, Mark, you mentioned permit fees to build in our area. How do these exorbitant costs affect those in construction and wanting to rent or buy a home in the SCC?
MH: In San Jose, there’s a very high building permit fee. For instance, you must pay handsomely to add on to an existing building, which is called an auxiliary dwelling unit (ADU). To get through the approval process, you must pay the permit fees (thousands and thousands of dollars) and wait for months.
Unfortunately, if you’re building an ADU, all those expenses of creating the unit ultimately get passed on to the consumer: the renter.
So these fees end up directly increasing the price of housing. Consequently, this discourages locals from applying to build units — and this contributes to our housing shortage by driving down unit availability.
ON: Could these fees also be connected to the local homeless housing crisis?
MH: Absolutely. Expensive local permit fees are part of the reason why there are so many people living on our streets.
Make no mistake: Our local housing affordability issue clearly impacts the homeless population. While California boasts only 12% of the U.S. population, we have 25% of the nation’s homeless residents. Clearly, whatever local officials are doing to address the homelessness crisis, they’re doing it wrong; and California is leading the United States in homelessness by a lot.
ON: Ultimately, how would you sum up your uniquely Libertarian approach to these housing issues?
MH: If you allow the government to dictate what can and can’t be built on your property, you just lost property rights. Moving forward, in order to build on your property, you must get permission from the government and pay a bunch of fees. Thus, every cost of doing business (i.e., taxes and fees) gets passed on to the customers.
Instead, people should be able to build what they want on their property, as long as it doesn’t interfere with others’ rights. For instance, if they want to open up their home as a shelter for refugees, that’s their business, not the government’s.
This relates to another stance of mine: that I would get rid of the San Jose building department, if I could. It’s the only department that actually makes money. Why should it make money? Moreover, I believe that this department shouldn’t exist in the first place.
ON: Might passing more beneficial ordinances promote freedom and growth in the local housing market?
MH: California seems to be in love with big government. However, from the Libertarian standpoint, their track record is abysmal; whenever they get involved to “fix” a problem, they seem to make things worse.
Thus, rather than wanting more ordinances passed locally, I would value deregulating the housing market. This way, the government can stop encroaching into everyday people’s lives.
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Image by Mark Moz