"Outrageous" cost of new affordable housing keeps prices and poverty rates high in state

California suffers simultaneously from a poverty and housing crisis. Dan Walters of CalMatters notes the relationship between the two developments, and fingers the startlingly high cost of new units as a key contributor.

The Census Bureau has once again found that California has the highest real-world poverty rate of any state, 17.2% over the previous three years and much higher than the national rate.

A new report from the California Policy Lab at the University of California reveals that in August nearly 20% of California’s workers were drawing unemployment insurance benefits, calling it “startlingly high.

Moreover, even before recession struck, the Public Policy Institute of California, using methodology similar to that of the Census Bureau, had calculated that as high as our “supplemental poverty rate” may be, roughly the same number of Californians are in “near-poverty.” Combining the two categories means that about a third of the state’s residents are struggling to keep their heads above water.

The Los Angeles Times did a deep dive into the tortured history of a low-income housing project in Solana Beach, a wealthy seaside community in San Diego County. Times reporters found that it originally was to cost $414,000 per unit, but by the time the developer pulled out after a decade of trying to line up financing and permits, it had exploded to $1.1 million.

The Times called it “an alarming example of how political, economic and bureaucratic forces have converged to drive up the cost of such housing at a time when growing numbers of Californians need it.”

These are outrageous numbers, driven by bureaucratic tangles, misplaced environmental restrictions and high mandated labor costs, and unless state officials do something about them, we will never solve our housing shortage and we will continue to have shamefully high rates of poverty.