Letter: Questions for Supervisors Rich Gordon and Jerry Hill

Letter to the editor

Posted by on Tue, May 23, 2006

On Wednesday May 24, incumbent San Mateo County Supervisors Rich Gordon and Jerry Hill will be present at the Midcoast Community Council meeting. Also attending will be Jo Chamberlain, the sole challenger for Rich Gordon’s seat in the upcoming June 6 election. Jerry Hill is running unopposed.

Below are some questions that I would like to ask the incumbent Supervisors, and also hear the reaction from Jo Chamberlain:

1. The Devil’s Slide closure has basically doubled the amount of traffic that must head south from the Midcoast during the morning commute. This is sort of like a natural experiment to see what traffic will be like under the Supervisors’ plan to double the number of housing units on the Midcoast in coming decades.  Given the extremely limited options for expanding Highways 1 and 92 in the future, the experience from the Devil’s Slide closure pretty much proves that the Supervisors’ buildout plan is a recipe for a traffic disaster. Why then, are the Supervisors forging ahead with this totally unworkable buildout plan?

2. On December 12, 2005, the Cabrillo Unified School District sent the Board of Supervisors a letter which stated quite clearly that Coastside schools "can support limited growth, but not a doubling in population." The Supervisors’ buildout plan completely ignores this important issue. How can the Supervisors justify a buildout plan that does not address the lack of capacity of the Coastside school infrastructure?

3. Half Moon Bay currently imposes a residential growth rate limit of 1%. After years of analysis and hearings, both the Midcoast Community Council and the County Planning Commission recommended that the Supervisors adopt a 1% residential growth rate limit for the Midcoast. The Supervisors ignored these recommendations and adopted a 2% growth rate limit as part of their buildout plan. Under their plan, the true growth rate limit would actually be much higher than 2%, because the Supervisors would grant full exemptions to: (1) new housing units classified as "affordable," (2) new second units, (3) so-called caretaker’s quarters in Princeton, and (4) disabled-persons housing (which have been proposed as part of the "Big Wave" office/housing complex). Given the severe future traffic problems that are already baked into the cake, how can the Supervisors justify anything but a strict (i.e., count everything) 1% growth rate limit similar to that imposed in Half Moon Bay?

4.  The Supervisors’ plan to double the number of housing units on the Midcoast will require a significant amount of water. The Coastside County Water District (CCWD) is already undertaking a series of major water system expansion projects to serve the Supervisors’ plan. Current residents are being compelled to pay for these projects with rate increases . In 2003, CCWD raised water rates by 9.6%. In 2005, CCWD raised water rates by 12%. In May 2006, CCWD announced plans to raise water rates by another 7%. How can the Supervisors’ justify a buildout plan in which current residents are being forced to subsidize (via higher water rates) more traffic-inducing future housing development?
 
Kevin J. Lansing
Half Moon Bay

 


Kevin,

I question whether the 2% growth really matters.  I don’t think we have ever on the Coast built that many homes.  When you look at the number of homes sales for any given year,  you’ll see that there really isn’t the strong demand to live here.

On a good year,  which this isn’t, we only sell 400 homes.  This year, we will be lucky if we even sell 300 homes. So adding a large supply of additional inventory would be hard to absorb.  Don’t forget that there will always be the constant supply of people who need to sell their homes for a variety of reasons.

Ocean Colony built 50+ new homes and that has taken several years to sell.  The project on Symour St in HMB took over a year to sell and that was just a few homes.

And new homes have become very expensive because of high land and building costs and the ever increasing time to get a building permit.  Its hard to build a new home today for less than $1.2 million. This high price tag also limits the number of people who can afford them.

So unless there is going to be a rush of people wanting to move here from over the hill,  a large increase in new construction will just flood the market costing builders a lot of money in carrying costs.

Steven Hyman

Kevin,  Thanks for asking the questions, I have sent them to all the candidates for tonight.  One addition to list of candidates for a seat on the Board of Supervisors, District 3 is Jack Hickey, Libertarian.  He will be there tonight too.

Kathryn

Steve,

Your assessment of the market seems to me to be right on the mark.

In my opinion, Kevin’s question #3 with the long exemption list (echoed here many times by Ms. Mauz as part of the big “fraud”) is designed to distract from a reasoned assessment (such as yours) of how the Coastside market could or could not actually absorb new houses every year or two years.  It cannot.  Maybe not even 20.  Demand simply isn’t there and will not be there in the foreseeable future due to higher interest rates and the supply side issues you mentioned.

Thanks for your professional opinion.

Steven Hyman wrote:
“I question whether the 2% growth really matters.  I don’t think we have ever on the Coast built that many homes.  When you look at the number of homes sales for any given year, you’ll see that there really isn’t the strong demand to live here.”

Steve, I think we can all agree that your profession’s views on the issue of growth limits is influenced by the main source of income: selling houses. There is nothing inherently wrong with that of course—it’s just the basic nature of political lobbying. Indeed, I know of only one realtor on the Coastside (Steve Skinner) who has ever publicly-supported things like strict growth limits or coastal open space protection.

That aside, your argument is basically this: A 2% (plus exemptions) growth constraint is not binding in a typical year anyway, so what’s the big deal?

Well how about this: The community, as expressed through the locally-elected Midcoast Community Council, asked for a 1% growth rate limit. That voice of the community should be respected by the Supervisors. Think of the 1% growth constraint as an insurance policy—-it might not be needed in every single year, but it is there to guard against the possibility of a huge housing project coming on line too quickly.

If the demand for housing on the Coastside is so low as you say, then you should have no objection to going along with the MCC and County Planning Commission recommendation of a 1% growth rate limit.

Kevin,

As a real estate broker,  I obviously make make my living by selling homes and land.

I will say that most of my views are shaped on economic principles.  I am a big believer in the free market and that the laws of supply and demand will produce the best results.

I also believe that most of the time when the government gets involved, they alter this balance and usually mess things up.

I think history has proven that quotas, price controls don’t work.  The smart people always find the loopholes and get around it.  And the little guy ends up paying for it.

As far as further reducing the allowable building,  I would say that if the number isn’t being exceeded then there’s no reason to even change it from its current level.  There’s obviously not a problem with this ordinance that has been on the books for many many years.

I know HMB has a 1% cap.  Personally,  I think the public was deceived when that was voted on because it was not well known that the City already had an arrangement with the owners of North Wavecrest for a specific number of homes which was included in the 1% total.

The result of this is that only 15 or so homes a year would go to the little people.  The beauty contest point system to award building permits has been painful to watch.  I question whether the public would have voted for this if they knew how it would work.

By artificially constraining the supply of new homes,  you will drive prices up more making this place even more expensive. So the new homes that take almost 2 years now to complete may cost $1.4-$1.5 million. 

As they say “if it ain’t broke,  dont fix it.”

Steve,

As one Realtor to another: I beg to differ.  Housing prices and valuations here on the coastside are a reflection of wider trends in the SF Bay Area.  Show me a builder on the Coastside, Peninsula or SF who is developing single family spec homes for under $1 million and I’ll be glad to reconsider.  The economics are such that builders need to build larger, more expensive homes to make their profit margins.  This is the free market at work and that’s fine. 

Coastside voters passed a growth control measure here in HMB in order to preserve the character of our town, protect our open space and to avoid sprawl.  Nobody will dispute that the City’s implementation of these growth controls has been problematic at times.  Still, I would not characterize this as government intervention, artificial price controls, quotas and the like.

Steve Skinner
Half Moon Bay

Steve,

My point was that if there is no problem with exceeding the current cap on building, why alter it.

When anybody puts a cap that restricts the supply, that is a quota as I see it. It doesn’t matter if it is for immigriation visas or building permits.  And when the demand exceeds the supply,  you have a problem.

In the City of HMB,  building permiits were significantly reduced. Compounding this reduction was the fact that the majority of these permits were previously allocated to a developer under a deal with the City.

Lot prices in HMB are higher than other parts of the Coast because most of the available land is in more expensive neighborhoods(i.e. Alsace Loraine and Miramar) and to a lesser extent because there are fewer available permits each year for the public.

Even within HMB,  you will see people paying a premium for a lot that is buildable now versus one that isn’t. So if there wasn’t a cap or quota,  all the prices in that neighborhood would more or less be the same.

In the past,  we’ve had sewer moratoriums that were circumvented by enterprising people who retrofited toilets. Wells were drilled to overcome water constraints.  We even had secondary markets for water connections where people have paid up to $30,000 for a hook-up.

By putting constraints on supply,  you force prices up when there is strong demand.