Howard County's Housing Affordability Crisis is a Boon for Developers
A crisis created by developers and for developers
Introduction
The housing affordability crisis is a challenge that continues to be exploited by the development industry to advocate for deregulation at the County Council. For years developers have cultivated and organized a so-called “YIMBY” (yes in my back yard) ideology, where the goal is to encourage any and all kinds of residential development regardless of impacts on infrastructure.
One of the major dogmas of this ideology is that housing is a commodity, where increasing the supply of housing ultimately leads to reduction in the price of homes. It further suggests that building homes at “various price points” is the key to unlocking the cheap homes nirvana. Additionally, it suggests that increasing rental apartments regardless of ownership and price would address housing affordability.
To achieve this goal, developers want unrestricted zoning laws. Any legislation or measure that can be seen as restricting “growth” is targeted and the supporters of the restrictive measures are labeled “NIMBYs” (not in my back yard) - the “naysayers.”
The tactics to tackle these measures take many forms: local YIMBY groups are formed with a specific mission to tackle zoning legislation, other non-profit groups are formed or infiltrated, paid lobbyists are enlisted, and of course YIMBY candidates are recruited to run for County Council and Board of Education races.
The Efforts of the Local Developer-Funded YIMBY Movement
The group Housing Affordability Coalition represents one such YIMBY group that was formed a few years ago. By all accounts, this group appears to have been formed around the time Howard County’s Adequate Public Facilities Ordinance (APFO) bill was passed in 2018.
The steering committee of the group is comprised of various notable advocates in housing who also appear on various county-sanctioned commissions and groups, including paid developer lobbyists.
Through this group and other means, the development industry has taken several tacks at dismantling APFO and any regulation that are meant to provide responsible rates of development.
Funding Flawed Studies: they produced county-funded study pieces that, even before the APFO legislation took effect, made fear-based claims that APFO is leading to decline in revenue based on a false premise that residential development pays for itself.
The SAAC: Since 2018, the county’s Spending Affordability Advisory Committee (SAAC) has produced cooked reports to support dismantling APFO, again claiming that residential development pays for itself.
The Racial Equity Task Force: The Racial Equity Task Force, which was formed in 2020 by Councilmembers Opel Jones and Christiana Rigby had similar goals. Here is one of its recommendations with respect to APFO:
We recommend that the APFO (Adequate Public Facilities Ordinance) allow a development exemption/ waiver for affordable housing projects. Specifically, we recommend the Council enact legislation that waives the APFO requirements for developments that reserve at least 50% of all rental units at households with incomes of 60% or less of the County median or 40% of all homeownership units for households with incomes of 80% or less of the County median.
The Housing Opportunities Masterplan: The Housing Opportunities Masterplan’s recommendations also made similar arguments.
The General Plan: The HoCoByDesign draft General Plan is the county’s 20-year plan, developed every ten years. For at least two years the county undertook a “public input” process where developers and their “affordable housing” allies provided talking points peppered with “duplexes”, “triplexes”, “missing middle”, and “ADUs” geared to dismantling Howard County’s regulatory mechanisms.
The draft General Plan makes the same false statements about residential development such as:
Howard County’s authority to assess both property and income tax locally is a leading reason new residential development contributes to the positive fiscal outcome.
Here is another recommendation from its “Managing Growth” Chapter:
[T]he APFO review should determine whether higher-density, mixed-use projects in activity centers, which may have low student yields, should meet different standards or thresholds, and whether pay-based incentives should be established where suburban-style developments could proceed if a higher school surcharge were paid. The task force should evaluate how APFO may apply to detached accessory dwelling units.
The draft plan, which has been pre-filed as legislation will be considered by the County Council over the next few months. The County Council holds its first public hearing on this bill on June 14, 2023.
Housing Affordability Coalition May 22 Meeting
In anticipation of the June 14 public hearing, the YIMBY group Housing Affordability Coalition held a meeting for its members on May 22, 2023 to discuss how it plans to advocate on the draft General Plan. The presentation offered an explanation of why housing is expensive in Howard County, how it should be addressed in the General Plan, and offered suggestions on how to address pushback based on concerns about schools and flooding in Ellicott City.
Why Is Housing Expensive? - the Developer Perspective
The dogmatic and perhaps the developer-aligned explanation for the housing affordability crisis in Howard County goes like this: Howard County has seen an increase in population because people want to live and work here (no explanation as to why want to live and work here), this increase in population has led to an increase in demand in housing, APFO has reduced the rate of development, and we need 20,000 homes to address this demand-supply mismatch.
As stated, the claim does not explain why people want to come to Howard County. There are several jurisdictions in Maryland where housing is cheaper. Why do people with families and those who want to start families prefer to come to Howard County?
Further, the claim suggests that increasing the supply of housing would somehow address housing affordability. Affordable housing advocates claim that there is a deficit of 20,000 homes in Howard County. The latest Redfin data show that the average price of a home in Howard County is $550,000. The estimated mortgage payment at this price and at 8% interest rate is approximately $4000.
At this rate, assuming only 30% of an individual’s income goes to housing it implies an annual household income of $144,000 is needed. Check out the Coalition’s own presentation about the percentage of families that can afford to own.
That means, for someone making $50,000 or $75,000 home prices need to be around $250,000 if the individual is able to afford the home without being burdened. It is highly unlikely that building 20,000 more homes would reduce the median homes price by 50%. Treating housing as a commodity leads to such flawed conclusions.
The development industry does not want zoning regulations that require affordable housing and offers an argument rooted in trickle-down economics to suggest that simply increasing supply of housing will address affordability. It is an argument to bypass the inconvenient zoning regulations that would need to be in place to provide effective mechanisms for affordable housing.
The Coalition suggests that the competition for homes has driven rents upwards and suggests that the trend of unaffordable rent is getting worse. It suggests since 2010 the number of households paying unaffordable rent has increased by 33%. It is worth noting that 2010 was the year of the last General Plan update, where aggressive housing units allocations were approved without proper mitigation on infrastructure. In the intervening time, the Downtown Columbia Plan was also approved where thousands of units were awarded to Howard Hughes Corporation in exchange for about 1000 “affordable units” where, to date, only 24 units have been delivered.
The Coalition suggests that rent is going up and affordability is going down without any mention of the unmitigated rate of residential development since 2010 and even beyond. There is no indication that the county failed deliver the allocated number of units from the 2010 general plan. So why are rents still going up? Either the planning process is completely flawed and has failed to make predictions, or housing is not a commodity, or both.
Meanwhile, the impacts of unmitigated rate of residential development has wreaked havoc on schools and the environment. But the Coalition completely downplays these impacts, simply paying lip service to the notion of protecting schools and the environment.
How to Handle Objections to Impacts on Schools and Ellicott City
One of the questions asked during this meeting was how to deal with objections to housing because of its impact to schools. Here is the response by the organizers:
The Coalition does not appear to grapple with the reality that schools are impacted by residential development. The main response boils down to a false claim that rental housing is not a major contributor of new students in a classroom.
Levels of service have declined, class sizes have grown, the deferred maintenance has ballooned to over $1.5 Billion, the number of classroom trailers keep on going up, and the school system continues to cut other services such as special education.
Next, a question about handling pushback on the impact of residential development on historic Old Ellicott City. The presenter says some development in the past did not follow the proper regulations and that Howard County has some of the highest environmental standards in the state.
Of course this is outrageous and false for two reasons: first the assertion made is a relative one. Meaning strongest compared to what? The bar on environmental regulations is set very low and anything better could be falsely characterized as “strongest.” Second, Howard County does not have strong environmental standards when it comes to development. The county allows wanton destruction of trees without penalties and there is
The Coalition’s Short and Long Term Plans
The Coalition expects three resistant legislators at the County Council. Councilmembers Liz Walsh, Deb Jung and David Yungmann. Councilmember Yungmann is considered resistant primarily because he might not support efforts to expand water and sewer to Western Howard County. Otherwise, he votes much more in line with Councilmembers Opel Jones and Christiana Rigby. In fact he has voted lock-step with Councilmembers Opel Jones and Christiana Rigby on a whole host of bills that benefit developers.
In any case the group hopes to target the council members with various tactics. One such tactic according to the presentation is to hold rallies and attend the public hearing with various picket signs. One of the notable signs depicts a black child with the words “Homeless HCPSS Children - 484.'“ One of the many exploitative techniques employed in the quest to dismantle regulations.
In the long term, the goal of this group and developers in general is to take zoning powers away from the local level. Listen to the presenter musing such an approach.
Indeed this is not a new idea. One of the members of the steering committee Tom Coale, a land-use lobbyist at Perry, White, Ross & Jacobson wrote a Maryland Matters Commentary stating the same.
Specifically he states:
“[w]e will need a governor focused on expanding access to housing in high opportunity areas, reexamining local rule as an obstacle to housing growth, and committed to the construction of new units funded by the state”, emphasis added.
Conclusion
The YIMBY vs. NIMBY framing creates the perfect condition for community members to talk past each other while the developers focus on dismantling zoning regulation and extracting economic benefits from terrible zoning laws.
In reality, most cases those who want quality schools and more housing are the same people. Some would say that people care about housing before schools and that is an unfortunate frame to create competing interests.
But, as stated there are many jurisdictions where housing is much cheaper and there is no indication that people are flocking to those jurisdictions.
Clearly something else is at play and that is infrastructure. Build all the houses you want. Build one million homes. Just make sure the infrastructure exists to provide adequate level of service.