Don't Count On Growth Debate During This Year's Race For Governor
Twelve years ago while running for governor against a knowledgeable growth management ex-mayor, Democrat Dianne Feinstein scribbled the word "growth" on her hand so she would not forget to bring it up in her debate with Republican Pete Wilson.
No such scribbling is likely in this year's gubernatorial campaign, which pits a powerful Sacramento insider against a business executive who has never run for office before. Incumbent Gray Davis has never comprehensively addressed the growth question — though he has occasionally focused on specific components, especially transportation and open space. Meanwhile, Republican nominee Bill Simon spent a couple of campaign days in August focused on growth and housing, and he did make a few headlines. But with his campaign on the defensive, it is unlikely that we will see a serious discussion of any growth policy issues.
That's too bad. California's eternal issues associated with growth have not vanished, and the state's rickety system of land-use planning, environmental review, infrastructure investment, and state-local finance only gets harder to manage each year. Beyond that, however, the difference in approach between the two gubernatorial candidates has the makings of an interesting policy debate.
In keeping with his reputation, Davis has used money — in the form of annual appropriations and big bond issues — to promote his objectives on growth-related issues. Simon, on the other hand, has laid out an aggressive and detailed program of regulatory reform designed primarily to stimulate the state's sluggish housing construction levels. At a time when Sacramento is awash in red ink, it is questionable how Davis will continue to promote his agenda and still avoid regulatory reform. So a gubernatorial policy debate on growth issues could actually be a serious and useful discussion — if anybody wanted to have it.
During his first term, Davis has assiduously used the state's powers — especially its financial muscle — to court favored constituencies. The result has been a significant flow of dollars into activities that will affect the state's future growth patterns. On open space, he has supported three bond issues, Propositions 12, 13, and 40, all of which passed. When the budget was flush, he promoted a series of innovative housing programs, including programs to reward local governments financially for building more than their fair share of housing. He has also targeted transportation funds to specific large projects with constituencies important to him, such as the BART extension from Fremont to San Jose.
Of course, Davis has had to kill or delay virtually all appropriations that depend on general fund revenue because of the budget deficit. And the list of accomplishments provided by his office mentions only three land use-related regulatory reform bills that Davis signed, all from last year: SB 497, Sen. Byron Sher's bill to close a loophole on lot-line adjustments; SB 221, Sen. Sheila Kuehl's bill to strengthen the link between land use planning and water supply; and SB 32, Sen. Martha Escutia's bill to give local governments more power to order cleanup of small brownfields. No major reform of planning or environmental law, or of the state-local fiscal relationship, has been adopted during Davis's term.
By contrast, Simon has taken on growth and housing in an aggressive way. As one might expect, he has called for increased infrastructure spending. Simon told the Association of California Water Agencies, for example, that he favors building more reservoirs. He has also continued to advocate the use of private toll lanes despite the state's unfavorable experiments in this area, apparently at the behest of Reason Foundation's Robert Poole, one of his policy advisers.
On land use and related issues, however, he has gone far beyond Davis and called for considerable regulatory reform. On August 7, he issued a policy white paper called "Renewing the California Dream By Increasing Home Ownership" and campaigned for two days around the state on the issue of housing cost. First, he gave a speech to the Oakland Chamber of Commerce in which he attacked Davis for signing SB 975, which requires prevailing wages to be paid on affordable housing projects.
The following day, he made a campaign swing in Southern California in which he called for regulatory reform on land use. Making stops in Ventura and Corona — both notorious slow-growth towns — he blamed restrictive land-use regulations for high housing prices. "These laws, however well meaning, shrink supply and drive up prices for everyone," he said in Ventura.
Virtually the only substantive policy proposal in the Simon arsenal that has received attention is his call for greater use of plastic pipes in home plumbing — an issue he has used to highlight Davis's ties to the construction trade unions. However, in his full position paper -- which is not posted on the campaign website — Simon has laid out a comprehensive, if conservative, approach to regulatory reform. Among other things he is proposing:
• A change in state affordable housing policy to discourage inclusionary zoning, which he claims drives up the price of market-rate units.
• Reform of the California Environmental Policy Act to exempt small projects, permit streamlined review of larger projects consistent with General Plans, and establish standard significance thresholds.
• More flexible brownfield cleanup standards so not all brownfields must meet the highest standard in order to be reused.
• Reform of construction defect liability laws.
• Providing more money to local governments by reallocating future property tax growth according to formulas in effect prior to the adoption of the Educational Revenue Augmentation Fund (ERAF) reallocation almost a decade ago.
• Softening prevailing wage laws on private development projects.
No matter what Simon might propose, however, nobody cares. Politically, all bets are on Davis and no significant interest group in the planning and development world dares to take on the sitting governor.
For example, city officials around the state have spent most of the last four years complaining that Davis reneged on a promise to solve the ERAF problem. Indeed, the League of California Cities seemed to delight in playing an audiotape of Davis apparently making that commitment at the League's conference in October of 1998, just a few weeks before he was elected.
However, in spite of the fact that Davis has neither proposed nor implemented any "structural" reform of ERAF, the League and many city leaders have continued to play ball with him, apparently because they view Davis as the only game in town. Virtually all the high-profile mayors in the state support him.
Admittedly, most are Democrats, even though they run for local office on a nonpartisan basis. But the comments of Irvine Mayor Larry Agran at a June press conference supporting Davis are typical. "With Gray Davis at the helm, not only has direct funding for local government increased but, more importantly, he respects that local officials are often the best suited decision makers for their communities," Agran said.
Maybe one of these years, the governor's race will serve as a useful forum to discuss how to plan for and manage the state's growth. But not this year.