SB 375: GREENHOUSE GAS EMISSIONS REDUCTION CHAMPION, OR DOOMED TO IRRELEVANCE? Louinda Vosloo Lacey B.S., California State University, Sacramento, 2006 THESIS Submitted in partial satisfaction of the requirements for the degree of MASTER OF BUSINESS ADMINISTRATION (Finance) at CALIFORNIA STATE UNIVERSITY, SACRAMENTO SPRING 2011 SB 375: GREENHOUSE GAS EMISSIONS REDUCTION CHAMPION, OR DOOMED TO IRRELEVANCE? A Thesis by Louinda Vosloo Lacey Approved by: __________________________________, Committee Chair Dr. Sudhir Thakur __________________________________, Second Reader Dr. John LaRocco ____________________________ Date ii Student: Louinda Vosloo Lacey I certify that this student has met the requirements for format contained in the University format manual, and that this thesis is suitable for shelving in the Library and credit is to be awarded for the Thesis. __________________________ Monica Lam, Ph.D. Associate Dean for Graduate and External Programs College of Business Administration iii ___________________ Date Abstract of SB 375: GREENHOUSE GAS EMISSIONS REDUCTION CHAMPION, OR DOOMED TO IRRELEVANCE? by Louinda Vosloo Lacey This Thesis seeks to determine whether SB 375 will successfully change land use development patterns in California. Specifically, the Thesis focuses on the fiscal and political barriers to the successful implementation of this Bill. Further, this Thesis provides a case study of the potential for successful implementation of the Bill in the San Joaquin Valley. The Thesis focuses on the San Joaquin Valley because: 1) the area is projected to have the greatest population growth by 2050, and 2) the California Air Resources Board set a single placeholder target for greenhouse gas emissions reduction for each of the eight San Joaquin Valley Metropolitan Planning Organizations. This Thesis uses both qualitative and quantitative data to analyze the foregoing problem. The qualitative data was mainly obtained from prior academic studies and surveys in the relevant subject areas, including public policy, legal studies and finance. The quantitative data was mainly obtained from California government agencies (such as the California Employment Development iv Department, California Department of Finance, California State Controller’s Office and California State Board of Equalization), the United States Census Bureau, and data compilations from academic studies. This Thesis concludes that the present fiscal constraints on California’s counties will require an allocation of land use development to increase property taxes. As a result, counties will likely disregard SB 375’s goals to the extent that they conflict with the maximization of property tax revenues. Further, the political climate may require additional regulations to facilitate local governments’ compliance with SB 375, through the use of mandates, fines, penalties, etc. Indeed, the case study of the San Joaquin Valley indicates that the individual counties differ greatly based on population growth, development trends, the level of interregional travel, employment trends and existing land use patterns, and constituents’ views and opinions. Thus, it is unlikely that the eight San Joaquin Valley Metropolitan Planning Organizations will meet CARB’s targets. If California seeks to reduce GHG emissions, the most productive manner may be to establish statewide standards and offset the available reductions based on land use, projected population growth, approved land development, statewide transportation, and natural resource allocation for future development. Although a statewide program will face significant political opposition, it would be the most effective method to facilitate collaboration and coordination among the various counties. v Air is fluid; it travels unobstructed and uninhibited from one region to another. This interconnectedness requires a broader and facilitated process to reduce greenhouse gas emissions effectively. _______________________, Committee Chair Dr. Sudhir Thakur _______________________ Date vi DEDICATION I dedicate this Thesis to my husband, Brian, for all his love, support and patience during my pursuit of the joint MBA/JD program. To all my professors at California State University, Sacramento, and University of the Pacific, McGeorge School of Law, for sharing their knowledge and inspiring my love for education. To all my colleagues (in work and education) who taught me different perspectives in business and law, and who challenged me to do my best at all times. vii TABLE OF CONTENTS Page Dedication ................................................................................................................ vii List of Tables.............................................................................................................. x List of Figures ........................................................................................................... xi List of Graphs ........................................................................................................... xii List of Definitions ................................................................................................... xiii Chapters 1. INTRODUCTION ................................................................................................ 1 I. Overview: Climate Change .................................................................. 1 II. Overview: California Climate Change Laws ....................................... 4 III. Overview: California Land Use Planning ............................................ 6 IV. Overview: SB 375 .............................................................................. 10 V. Overview: CARB Target Emissions Report ...................................... 18 VI. Literature Review of S.B. 375............................................................ 25 VII. Defining the Problem ......................................................................... 32 2. FISCAL CONSTRAINTS .................................................................................. 34 I. Introduction ........................................................................................ 34 II. Background ........................................................................................ 34 III. Literature Review ............................................................................... 38 viii IV. Data .................................................................................................... 42 V. Methodology ...................................................................................... 44 VI. Analysis .............................................................................................. 44 VII. Conclusion ......................................................................................... 49 3. POLITICAL CONSTRAINTS ........................................................................... 52 I. Introduction ........................................................................................ 52 II. Housing Element Law ........................................................................ 52 III. MPO Political Structure ..................................................................... 63 IV. Conclusion ......................................................................................... 67 4. CASE STUDY: SAN JOAQUIN VALLEY ....................................................... 70 I. Introduction ........................................................................................ 70 II. CARB’s Targets for the San Joaquin Valley ..................................... 73 III. Individual San Joaquin County Concerns .......................................... 74 IV. Development Trends .......................................................................... 76 V. Interregional Travel ............................................................................ 81 VI. Employment Trends and Existing Land Use Patterns ....................... 85 VII. Constituents’ Opinions and Views ..................................................... 90 VIII. Conclusion ......................................................................................... 94 Bibliography............................................................................................................. 97 ix LIST OF TABLES Page Table 1: Elements of General Plan ............................................................................ 8 Table 2: Sample List of SB 375 Policies & Practices to Reduce GHG Emissions .. 19 Table 3: RTP Adoption Dates by MPO ................................................................... 24 Table 4: Changes in Homeowner Property Tax Allocation 1998-2008 ................... 46 Table 5: Revenue from State and Federal Government Agencies ........................... 47 Table 6: Revenue from All Property Taxes ............................................................. 48 Table 7: Housing Element Law Compliance 2004-2008 ......................................... 59 Table 8: Current and Projected Regional Population Growth in California ............ 72 Table 9: Population Growth in the San Joaquin Valley ........................................... 76 Table 10: Population Growth Between 2006 – 2009 ............................................... 78 Table 11: Single Family Building Permits 2006 – 2009 .......................................... 79 Table 12: Multi-Family Building Permits 2006-2009 ............................................. 79 Table 13: Unemployment Percentage Data.............................................................. 80 Table 14: San Joaquin Valley Commuting Patterns ................................................ 84 Table 15: San Joaquin Valley Commuting Patterns Percentage Breakdown .......... 85 Table 16: Percentage Distribution of Employment by Industry, 2002 .................... 89 Table 17: Most Important Issue Facing Central Valley Opinion Poll ..................... 91 x LIST OF FIGURES Page Figure 1: San Joaquin Valley ................................................................................... 71 Figure 2: San Joaquin Valley MPOs ........................................................................ 72 xi LIST OF GRAPHS Page Graph 1: Percentage Change in Homeowner Property Tax Allocation 1998-2008 . 46 Graph 2: Percentage Revenue from State and Federal Governments ...................... 47 Graph 3: Percentage of Property Taxes as Part of County Revenues ...................... 48 Graph 4: Population Growth in the San Joaquin Valley .......................................... 77 xii LIST OF DEFINITIONS A.B. 32 APS CAA CARB CEQA COG EIR GHG HCD MPO OPR RHNA RTP S.B. 375 SCEA SCS UNFCC US USEPA VMT California Assembly Bill 32 Alternative Planning Strategy United States Clean Air Act California Air Resources Board California Environmental Quality Act Council of Governments Environmental Impact Report Greenhouse gas emissions California Department of Housing and Community Development Metropolitan Planning Organization California Office of Planning and Research Regional Housing Needs Assessment Regional Transportation Plan California Senate Bill 375 Sustainable Communities Environmental Assessment Sustainable Communities Strategy United Nations Framework Convention on Climate Change United States of America United States Environmental Protection Agency Vehicle Miles Traveled xiii 1 Chapter 1 INTRODUCTION I. Overview: Climate Change Climate change has been a controversial issue of debate (i.e. whether it exists, whether the underlying science is accurate, and how to combat the effects) throughout the world over the past few decades. At the heart of the global warming debate is the need to reduce greenhouse gas (GHG) emissions. According to the United States Environmental Protection Agency (USEPA), the principal GHGs entering the atmosphere due to human activities are carbon dioxide, methane, nitrous oxide and fluorinated gases. Rising GHG emissions are causing a significant rise in the average global temperatures, which “is predicted to lead to reduced food yields, significant water shortages, sea level rise on a scale that will threaten many major cities, species extinction, extreme weather and, ultimately, abrupt and large scale changes in global climate.” (Marsden and Rye, 2010, p. 670.) Without affirmative action to reduce the impacts of global warming, scientists predict climate change will bring about great economic hardships in the form of reduced production, to the extent of 5%-20% of the world gross domestic product per year. (Stern et al., 2006.) Worldwide climate change presents a unique political issue because it “involves localized actions with global repercussions.” (Darakjian, 2009, p. 374.) In the United States of America (US), it has often been said that “[e]ven for smaller cities 2 and counties, where the effects of local land use decisions may appear insignificant in isolation, the accumulation of these incremental decisions will have a considerable impact on the statewide greenhouse gas emissions.” (Stern, 2008, p. 625.) The worldwide “ historic vehicle for climate change policies has been the United Nations Framework Convention on Climate Change (UNFCCC) and its associated Kyoto Protocol (Protocol).” (Whitman, 2003, p. 1.) The UNFCCC is an international environmental treaty with the goal of reducing GHG emissions. Since the Protocol’s inception in December 1997 and entry into force in February 2005, 193 parties have ratified the treaty. (United Nations Framework Convention on Climate Change.) The US is notably absent from the list of ratification. Although the US signed the Protocol in 1998, it has refused to ratify the treaty. In December 2010, almost all world parties will attend a “Conference of the Parties” to the UNFCCC with the intent of signing a new global climate change agreement. It is unclear how the US will participate at the conference. If the US were to enter into a treaty, it could change the landscape of greenhouse gas emissions administration in the US, which is handled almost exclusively by the individual states. In the US, the individual states (rather than the federal government) have enacted climate change programs to reduce GHG emissions. (McKinstry and Peterson, 2007, p. 62.) In fact, prior to 2007, the USEPA refused to regulate GHG 3 emissions under section 202 of the Clean Air Act (CAA) until the US Supreme Court’s (USSC) decision in Massachusetts v. EPA (2007) 549 U.S. 497. In this 5-4 decision, the USSC held: (1) the USEPA has authority to regulate GHG emissions (including carbon dioxide) as “pollutants” under the CAA; and (2) the USEPA failed to articulate adequate reasons for its failure to regulate such emissions. (Massachusetts v. EPA, supra, 549 U.S. at pp. 529-535.) Further, the USSC found “[t]he harms associated with climate change are serious and well recognized,” acknowledging Massachusetts’ interest in the outcome of the litigation because a precipitate rise in sea levels would continue to swallow the state’s coastal land. (Id. at p. 499.) This case is significant because it recognized standing by individual states premised on concrete harms resulting from climate change. (Id. at pp. 521526.) The USEPA responded to Massachusetts v. EPA by: (1) adopting mandatory GHG emissions reporting requirements for some economic sectors; (2) adopting the “Light-Duty Vehicle” rule in conjunction with the Department of Transportation National Highway Traffic Safety Administration; (3) finding GHG emissions from new cars and trucks cause or contribute to conditions that endanger public health and welfare; and (4) adopting the “Tailoring Rule.” (Rubalcava, 2010.) However, the future of the USEPA’s rulemaking on GHG emissions is unknown. The USEPA is embroiled with numerous lawsuits challenging the “Endangerment Finding” and “Tailoring Rule,” and proposed legislation (Waxman- 4 Markey and Kerry-Lieberman) seeks to remove GHGs from the CAA altogether (and thus the USEPA’s authority). (Rubalcava, 2010.) Perhaps the future of GHG reduction programs will remain with the individual states rather than the federal government. The state GHG reduction programs have ranged “from voluntary agreements and incentive-based approaches to regulatory mechanisms that include both traditional codes and standards and new market-based systems.” (McKinstry and Peterson, 2007, p. 62.) This thesis focuses on California’s approach to GHG emissions reductions – more specifically, California’s latest adoption of Senate Bill 375 (SB 375), which seeks to reduce GHG emissions from the transportation sector through land use regulation. II. Overview: California Climate Change Laws On September 27, 2006, California Governor Arnold Schwarzenegger signed into law Assembly Bill 32 (AB 32), also known as the Global Warming Solutions Act of 2006. (Health & Safety Code § 38500 et seq.; Darakjian, 2009, p. 372.) AB 32 established the first economy-wide climate change regulatory program in the US, requiring California to reduce GHG emissions to 1990 levels by 2020. AB 32 grants the California Air Resources Board (CARB) broad authority to: (1) require any “source” of GHG emissions (including automobiles and light trucks) to participate in programs to reduce GHG emissions; and (2) to “monitor 5 compliance” with the statewide GHG emissions limit. (Health & Safety Code §§ 38505(i), 38562 et seq.) In November 2010, Californians defeated Proposition 23, which sought to suspend the implementation of AB 32 until unemployment dropped to 5.5% or less for one full year. The defeat of this initiative seemingly sends a strong message to California’s politicians – Californians intend to set the stage for GHG emissions reduction programs in the US. Even without federal participation in GHG emissions reductions, California’s dedication to the program could have great national and international consequences, because “if the state were a nation, its yearly GHG emissions would place it somewhere between the tenth- and sixteenthhighest contributors globally.” (Darakjian, 2009, p. 377, fn. 21.) SB 375, also known as the Sustainable Communities and Climate Protection Act, was enacted in September 2008 to support AB 32 by building “on the existing regional transportation planning process (which is overseen by local elected officials with land use responsibilities) to connect the reduction of [GHG] emissions from cars and light trucks to land use and transportation policy.” (Higgins, 2008, p. 1.) “SB 375 seeks to harmonize three distinct areas – regional housing need, transportation infrastructure development and statewide air quality goals – in one comprehensive program.” (Darakjian, 2009, p. 372.) The law has three main goals: (1) use the regional transportation planning process to achieve A.B. 32’s goals; (2) encourage infill residential projects by using California 6 Environmental Quality Act (CEQA) streamlining as an incentive to reduce GHG emissions; and (3) coordinate the regional housing needs allocation process with the regional transportation planning process. (Higgins, 2008, p. 2.) SB 375 is a “program” within the CARB’s authority for the automobile and light truck sector. (Health & Safety Code § 38562.) The focus on transportation emissions stems from the fact that California’s transportation sector is the state’s single largest producer of GHGs (at approximately 38% of overall emissions), with passenger vehicles being responsible for about 30% of the total GHG emissions. (Darakjian, 2009, p. 378.) The CARB projects a 5 million metric tons reduction in carbon dioxide emissions in California from SB 375 by 2020. (Peter, 2010.) Land use strongly influences transportation decisions, and “density and accessibility to job centers are significant drivers of automobile use.” (Malaczynski and Duane, 2009, pp. 80-81.) III. Overview: California Land Use Planning Generally, the federal and state governments are superior in power to local governments, and limit local governments’ power in many ways. (Baer, 2008, p. 52.) “Land use is the major exception.” (Baer, 2008, p. 52.) California Constitution Article XI, section 7 states: “A county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.” 7 Local government’s planning power is subject to various laws, including: General Plan Law (Government Code § 65300 et seq.); Planning, Zoning and Development Laws (Government Code § 65000 et seq.); Subdivision Map Act (Government Code § 66410 et seq.); California Environmental Quality Act (Public Resources Code § 21000 et seq.); Community Redevelopment Law (Health & Safety Code § 33000 et seq.); Cortese-Knox Local Government Reorganization Act (Government Code § 56000 et seq.). The primary source of state authority over local land use regulation is the California Planning and Zoning Law (Government Code § 65000-66499.58). This law requires all cities and counties to develop a general plan to guide future development decisions. (Stern, 2008, p. 616.) The general plan must address seven substantive elements as described in detail in Table 1: land use, circulation, housing, conservation, open space, noise and safety. (Government Code § 65302.) “All local zoning ordinances and project proposals must be ‘consistent’ with the general plan.” (Stern, 2008, p. 616; Government Code § 65359.) “[L]ocal governments operate under a regime of self-imposed environmental law and state imperatives are injected indirectly through the primary tools of air quality regulation, transportation funding, and the California Environmental Quality Act.” (Stern, 2008, p. 615, citing Cal. Pub. Res. Code sections 21000-21177 (West 2008).) 8 Table 1: Elements of General Plan REQUIRED ELEMENTS Land Use Circulation Housing Conservation Open-Space Noise Safety DESCRIPTION OF ELEMENTS The most basic part of the plan, which deals with such matters as population density, building intensity, and the distribution of land use within a city or county Must deal with all major transportation improvements. It serves as an infrastructure plan and must also be specifically “correlated” with the land use element – that is, the infrastructure must address the development patterns expected by the land use element Must assess the need for housing for all income groups and lay out a program to meet those needs Deals with flood control, water and air pollution, and the need to conserve natural resources such as agricultural land and endangered species Is supposed to provide a plan for the long-term conservation of open space in the community Must identify noise problems in the community and suggest measures for noise abatement Must identify seismic, geologic, flood, and wildfire hazards, and establish policies to protect the community. Source: Fulton, 1999, p. 106 The CEQA was passed in 1970 and forces consideration of the environmental effects of land use planning. The CEQA requires the controlling public agency (generally a city or county), known as the lead agency, to prepare an Environmental Impact Report (EIR) for proposed land use changes that could have a significant adverse effect on the environment. (Malaczynski and Duane, 2009, p. 84.) The lead agency must document significant adverse environmental impacts of the proposed project, offer alternatives to the proposal in the EIR, and must offer plans for mitigation of the documented significant effects. (Malaczynski and Duane, 2009, p. 84.) The proverbial “stick” of the CEQA process is the threat of 9 litigation, which has added significant uncertainty and expense to the planning process. (Olshansky, 1996.) Historically, local governments did not include significant analysis of the impact of GHG emissions in the EIR process. However, in 2007, California’s Attorney General sued the County of San Bernardino for the city’s failure to address climate change in its general plan update. (State ex rel. Brown v. County of San Bernardino (2007) No. CIVSS 0700329.) Although the case resolved in settlement, the impact of the suit was clear. In 2006, only two environmental assessment documents contained a discussion of climate change; compared to the 149 environmental assessment documents addressing climate change impacts in 2007. (Stern, 2008, p. 633, fn. 123.) In response to the San Bernardino suit, the legislature adopted Senate Bill 97, requiring the Office of Planning and Research (OPR) to develop emission mitigation guidelines by 2010 that “will assist local agencies by providing policy tools to make climate-conscious land use decisions.” (Stern, 2008, p. 633.) The OPR is “the state executive agency tasked with overseeing statewide land use planning,” but does not have “any direct operating or regulatory powers over land use, public works, or other state, regional, or local projects or programs.” (Stern, 2008, p. 617.) The OPR’s newly developed guidelines now require the lead agency to consider whether the cumulative effect of the project complies with “plans or regulations for the reduction of greenhouse gas emissions,” and outline procedures 10 to determine the significant impacts from GHG emissions. (Guidelines for Implementation of the CEQA §§ 15064(h)(3), 15064.4.) These procedures require the lead agency to: (1) use a model or methodology to quantify the GHG emissions resulting from the project; and then (2) consider various factors to determine whether the project results in significant GHG impacts (including whether it increases or decreases GHG emissions, whether the emissions would exceed the threshold of significance, and whether the project complies with other statewide, regional or local GHG emissions reduction plans.) (Guidelines for Implementation of the CEQA § 15064.4(a)-(b).) These CEQA guideline amendments became effective on March 18, 2010. IV. Overview: SB 375 The primary goal of SB 375 is to reduce “vehicle miles traveled (VMT) among California’s 23 million licensed drivers.” (Darakjian, 2009, p. 372.) Central to SB 375’s “smart growth” concept is the “location of housing, jobs, retail, services, recreation and retail within proximity of one another to promote compact, walkable communities that use resources and infrastructure efficiently.” (Greenway, 2010, p. 434, fn. 9.) SB 375’s provisions only apply to California’s 17 Metropolitan Planning Organizations (MPOs), which includes 37 of the 58 counties in the state (representing 97.7% of the statewide population). (California State Association of Counties, 2008, pp. 1, 4.) Traditionally, these MPOs assisted with implementing 11 the state’s housing need allocation at the local level, and creating and updating the federal transportation plans. (Darakjian, 2009, p. 385.) The MPOs and councils of governments (COG) “have acted as an interface between state and local governments and it is toward this middle stratum that SB 375 directs the majority of its mandates.” (Darakjian, 2009, p. 385.) However, the law primarily relies on “incentives, market forces, political leadership, and public education to be the driving forces for change.” (Greenway, 2010, p. 439.) SB 375 requires the California Air Resources Board (CARB) to establish GHG emissions reduction targets for each MPO at the regional level. (Higgins, 2008, p. 3.) The process for establishing these targets is considered a “bottom-up” approach, because the CARB must first share and exchange technical information with each MPO prior to setting the targets. (Higgins, 2008, p. 3.) Further, the MPOs may recommend a target for the region. (Government Code § 65080(b)(2)(A)(ii).) The CARB-appointed Regional Targets Advisory Committee would review each MPO’s technical information and would recommend factors and methodologies to be used in setting the standards. (Government Code § 65080(b)(2)(A)(i).) The CARB released the regional targets on September 23, 2010. a) Sustainable Communities Strategy After the release of the regional targets, each MPO must prepare a regional land use plan, called a Sustainable Communities Strategy (SCS), to meet the CARB 12 required targets. (Government Code § 65080(b)(2).) The purpose of the SCS is show how the integration of the forecasted development pattern with the transportation network, policies and measures in the region will reduce GHG emissions from automobiles and light trucks to the GHG emissions reduction target set by the CARB. (Higgins, 2008, p. 5.) The SCS is included in the MPO’s federally required Regional Transportation Plan (RTP), “expressing its underlying land use assumptions and becoming a blueprint for how the region will meet its GHG targets if it is feasible to do so.” (Greenway, 2010, p. 436; Government Code § 65080(b)(2).) Under federal law, local governments must prepare a RTP that includes a land use allocation plan based on the region’s realistic development pattern over a 20-30 year time span. (California State Association of Counties, 2008, p. 3.) The development pattern must be based on “current planning assumptions,” such as local general plans and sphere of influence boundaries. (California State Association of Counties, 2008, p. 4.) The RTP informs the decision-making process for transportation funding. If the federal government finds the projected growth development pattern unrealistic, it may withhold federal transportation funding. (California State Association of Counties, 2008, p. 3.) The “action element” (that portion of the RTP that “describes the programs and actions necessary to implement the plan”) and the “financial element” (that portion that 13 “summarizes the cost of plan implementation”) of the RTP must be consistent with the SCS. (Government Code §§ 65080(b)(3), 65080(b)(4)(A).) Prior to adopting the SCS, each MPO must first quantify the GHG emissions reductions projected from implementation of the SCS and must set forth the difference between that amount and the region’s target. (Government Code § 65080(b)(2)(G).) Consistent with federal regulations for the RTP, the SCS must be based on the “most recent planning assumptions considering the local general plans and other factors,” and the best practically available scientific information regarding resource areas and farmland in the region. (Government Code § 65080(b)(2)(B); Higgins, 2008, p. 5.) The SCS must identify the general location of uses, residential densities, building intensities, and a transportation network to service the transportation needs of the region. (Higgins, 2008, p. 5.) Further, the SCS must identify areas sufficient to: (1) house all economic population segments over the RTP planning horizon, and (2) house an 8-year projection of regional housing need for the region. (Higgins, 2008, p. 5.) Because the SCS is based on “current planning assumptions,” a regional agency would have difficulty including types of development patterns unlikely to emerge from local decision-making. (Higgins, 2008, p. 5.) SCSs are expected to respond to SB 375 by: (1) promoting compact development patterns located near transit; (2) coordinating between the location of employment and housing; (3) support transit use; (4) concentrating economic 14 activities into existing communities; and (5) incorporating a mix of housing types. (Urban Land Institute, 2010, p. 2.) Compliance with the SCS is expected to produce: (1) shorter commutes, VMT reduction and congestion relief; (2) reduce GHG emissions and air pollution; (3) less fossil fuel consumption; (4) greater conservation of farmlands and habitat; (5) opportunities for more housing choices for all economic population segments; (6) reduce infrastructure costs; (7) higher quality of life; and (8) greater certainty for the development community. (Urban Land Institute, 2010, p. 2.) However, the law does not require local jurisdictions to comply with the SCS to receive transportation funding. (Higgins, 2008, p. 9.) Thus, the SCS is a plan without authority. Only the CARB has authority to approve or reject the MPOs’ SCSs. (Government Code §§ 65080(b)(2)(J), 65080(b)(2)(I)(ii).) Within 60 days following submission of the SCS, the CARB must accept or reject: (1) the quantification of the GHG emissions reductions the proposed strategy would achieve; and/or (2) the methodology used to arrive at the determination. (Government Code § 65080(b)(2)(J); California State Association of Counties, 2008, p. 5.) The CARB may not issue conditional approvals and may not otherwise interfere with local decision-making. (California State Association of Counties, 2008, p. 5.) 15 b) Alternative Planning Strategy If the CARB finds that a MPO’s SCS fails to meet the regional GHG emissions reduction target, the MPO must prepare an alternative planning strategy (APS). (Government Code § 65080(b)(2)(H).) Similar to the Clean Water Act and the CAA, SB 375 applies a “feasibility” standard to limit and define administration of reduction measures in the regional SCS. (Darakjian, 2009, p. 399, fn. 117.) The term “feasible” is broadly defined as “economic, environmental, legal, social, and technical factors” that may pose obstacles to meet GHG emissions reductions “within a reasonable period of time.” (Government Code § 65080.01(c).) If a MPO cannot meet the regional emissions reductions targets under the SCS through “feasible” means, it must prepare an Alternative Planning Strategy (APS). (Government Code §§ 65080(b)(2)(B)(viii), 65080(b)(2)(H).) The APS must “identify the practical impediments” to achieving the regional targets through a SCS and must demonstrate how GHG emissions could be achieved through “alternative development patterns, infrastructure, or additional transportation measures or policies.” (Government Code §§ 65080(b)(2)(H).) Unlike the SCS, an APS is not incorporated into the RTP and “therefore does not automatically affect the distribution of transportation funding.” (Government Code §§ 65080(b)(2)(H), Higgins, 2008, p. 6.) Preparation of an APS rather than a SCS does not preclude access to the CEQA streamlining benefits under the bill. (Public Resources Code §§ 2155(a), 21159.28(a).) 16 Similar to a SCS, only the CARB has authority to approve or reject the MPOs’ APSs. (Government Code §§ 65080(b)(2)(J), 65080(b)(2)(I)(ii).) Within 60 days following submission of the APS, the CARB must accept or reject: (1) the quantification of the GHG emissions reductions the proposed strategy would achieve; and/or (2) the methodology used to arrive at the determination. (Government Code § 65080(b)(2)(J); California State Association of Counties, 2008, p. 5.) c) CEQA Streamlining SB 375 seeks to encourage high-density and infill development by providing incentives, including CEQA streamlining for qualifying projects. Residential or mixed-use residential projects consistent with the land use designation, density, building intensity and applicable policies in the region’s SCS or APS, and incorporating certain mitigation measures (such as traffic control improvements, street or road improvements, transit passes), will not be required to “reference, describe or discuss”: (1) growth-inducing impacts; or (2) any project specific or cumulative impacts from cars or light-duty truck trips generated by the project on global warming or the regional transportation network. (Public Resources Code § 21159.28(a); Higgins, 2008, p. 13.) Further, such projects will not need to consider any density alternatives. (Public Resources Code § 21159.28(a).) A residential or mixed-use residential project generally requires that at least 75% of the total building footage designated for residential use; however, 17 for infill sites located in primary urban-zoned areas, only 50% of the total building footage must be designated for residential use. (Public Resources Code §§ 21159.28(d), 21155(b).) Transit priority projects may receive a full CEQA exemption (subject to strict requirements) or may prepare a Sustainable Communities Environmental Assessment (SCEA), which allows for a shorter comment period and the deferential “substantial evidence” standard of review. (Public Resources Code §§ 21155.1, 21155.2.) A priority project is one that: (1) contains at least 50% residential use; (2) has a minimum net density of 20 units/acre; (3) has a floor area ratio of not less than 0.75 for nonresidential use; and (4) is located within one half mile of a “major transit stop” or “high-quality transit corridor” (Public Resources Code §§ 21064.3, 21155(b), 21155(a).) d) Implementation The two important aspects that remain untouched in SB 375 are: (1) local governments retain their traditional exclusive land use authority; and (2) state and federal funding is not expressly contingent on compliance. (Darakjian, 2009, p. 386.) However, it is important to note that the law specifically provides that SCSs and APSs do not supersede local land use decisions, and that local general plans, specific plans and zoning ordinances need not be consistent with the SCSs or APSs. (Cal. Gov. Code § 65080(b)(2)(J).) Thus, cities and counties retain their traditional exclusive land use authority. The statute is “built on faith that cities and counties 18 will voluntarily implement the SCS or at least respond to regional political pressure to do so.” (Darakjian, 2009, p. 403.) Further, SB 375 does not provide any funding for planning or investment for infrastructure to support infill or higher-density development. Other legislation makes some grant funds available to local agencies for planning related to SB 375, but the RTAC has observed the SB 732 funds will be insufficient to support local government planning efforts envisioned by SB 375, noting “planning staffs are struggling to keep pace with current planning demands, leaving little capacity for comprehensive, sustainable long range planning.” (Regional Targets Advisory Committee, 2009.) V. Overview: CARB Target Emissions Report On September 23, 2010, the CARB adopted regional GHG emissions reduction targets pursuant to the Staff Report on “Proposed Regional Greenhouse Gas Emission Reduction Targets for Automobiles and Light Trucks Pursuant to Senate Bill 375.” (CARB, 2010.) The CARB projected that the proposed targets “would result in a reduction of [GHG] emissions of over three million metric tons of [carbon dioxide] per year (MMTCO2/year) in 2020, and 15 MMTCO2/year in 2035.” (CARB, 2010, p. 22.) The CARB used “a bottom-up process” to establish the GHG emissions reductions targets, by relying on the “MPOs experience in regional transportation planning, housing policy, and regional sustainability” to “provide baseline 19 information and growth projections” for future target years. (CARB, 2010, p. 20.) The CARB used an emissions model to convert the travel activity and vehicle speeds from the MPOs’ travel models into GHG emissions. (CARB, 2010, p. 17.) Various assumptions in the MPOs’ models influence the CARB’s estimates, including “the types, ages, and number of vehicles that are on the road in the future; as well as the CO2 emissions per vehicle mile.” (CARB, 2010, p. 17.) The Department of Transportation is presently working on development of a statewide travel model, including interregional and goods movement travel throughout the State. (CARB, 2010, p. 19.) Most of the MPOs provided the CARB with suggested reduction targets or projections. The MPOs based these targets or projects on various strategies, including “increased compact development, expansion of transit networks, improved jobs-housing balance, and various pricing strategies.” (CARB, 2010, p. 14.) Table 2: Sample List of SB 375 Policies & Practices to Reduce GHG Emissions Density Diversity LAND USE · Increase infill and development in areas with existing infrastructure · Increase opportunities for redevelopment/reuse (e.g., brownfields) · Increase residential/commercial density near transit (e.g., transit oriented developments) · Increase use of compact building design in new and existing developments · Increase mixed use development (e.g., residential and commercial uses in infill, reuse/redevelopment or greenfield projects) · Increase transit oriented development 20 Design Distance to Transit Housing Open Space and Agricultural Land Conservation Location of Development Incentives Transit Facilities and Service Pedestrian Infrastructure and Environment Bike Infrastructure and Environment Interconnectivity Among Alternative Modes Road Quality and Service Parking Management · Improve connectivity of streets and pedestrian network (e.g., through streets) · Improve neighborhood and site design (e.g., traffic calming, beautification) · Increase residential/commercial density near transit (e.g., transit oriented development) · Make developments transit ready · Increase local housing for local workforce (e.g., jobs-housing fit, jobshousing balance) · Integrate affordable and market rate housing · Improve accessibility of housing to transit · Reduce pressure on greenfields by directing growth to existing developed areas · Adopt mechanisms to protect key natural resources · Locate major regional activity centers near existing development (e.g., “destinations”) · Locate schools in neighborhoods that house the student population or maximize access by alternate modes · Implement other location-related policies · Provide financial incentives (e.g., grants, tax credits) for nontransportation investments like housing, parks, and storm water management · Provide regulatory relief (e.g., expedited permit processing) · Provide recognition programs TRANSPORTATION POLICIES · Expand transit network · Improve transit facilities (e.g., safety) · Reduce passenger travel time (e.g., more frequent headways) · Adopt competitive fare structure · Improve pedestrian facilities and infrastructure · Improve pedestrian environment (e.g., beautification, access) · Implement “safe routes to schools” program · Improve bicycle facilities and infrastructure · Improve cyclist environment (e.g., safety, access) · Implement “safe routes to schools” program · Improve linkages between modes of travel · Use Intelligent Transportation System technologies (e.g., “smart card”) · Rehabilitate and maintain pavement · Use transportation system management (e.g., congestion management) · Implement effective pricing · Alter parking requirements and types of supply (e.g., maximum parking, shared parking) · Improve circulation efficiency through information (e.g., signage) 21 Employer-Based Commute Trip Reduction Other Trip Reduction Parking Pricing Road User Pricing Fuel Tax Transportation System Development Transportation Demand Management · Encourage telecommuting and flexible/alternative work schedules · Implement and coordinate use of employee vehicle sharing programs and alternative modes (e.g., incentives for carpool, bike, transit, vanpool use) · Improve employer parking management (e.g., employee parking “cash out”, unbundling parking cost from property cost) · Implement vehicle sharing programs (e.g., car sharing, bike sharing, park and ride lots) · Provide local shuttles PRICING POLICIES · Implement metered pricing · Implement parking "cash-out" program · Implement congestion pricing · Implement High Occupancy Toll (HOT) lanes · Implement area or cordon pricing · Implement distance-based (VMT) pricing · Increase fuel tax SYSTEM DEVELOPMENT · Eliminate or reduce highway and arterial projects that result in additional “general purpose” lane miles · Expand regional park and ride facilities · Implement regional bicycle facilities and infrastructure · Expand high occupancy toll (HOT lanes) system · Implement traffic signal coordination · Queue jumps/Bus priority at intersections · Provide real time transit information · Speed limit reductions to 55 MPH · Ramp metering · Incident management system · Freeway travelers information system · Anti-idling traffic codes for commercial vehicles · Enhance vehicle inspection and maintenance programs · Operation improvements to relieve bottlenecks DEMAND MANAGEMENT · Eco driver education · Student carpool programs · Staggered school class schedules · On-site child care facilities · Pay-as-you-drive insurance Source: CARB, 2010, pp. 45-47. The CARB adopted the following GHG emissions reduction targets for 2020 and 2035: (CARB, 2010, pp. 23-37.) 22 Four Largest MPOs: SCAG, MTC, SANDAG and SACOG o Southern California Association of Governments (SCAG) 2020: 8% reduction (matches MPO’s suggested target) 2035: 13% reduction (MPO suggested 5-6% reduction) o Metropolitan Transportation Commission (MTC) – Bay Area 2020: 7% reduction (matches MPO’s suggested target) 2035: 15% reduction (matches MPO’s suggested target) o San Diego Council of Governments (SANDAG) 2020: 7% reduction (matches MPO’s suggested target) 2035: 13% reduction (matches MPO’s suggested target) o Sacramento Council of Governments (SACOG) 2020: 7% reduction (matches MPO’s suggested target) 2035: 16% reduction (matches MPO’s suggested target) Central Valley MPOs: due to significant expected changes in data, modeling and decisions to be made in the Valley, the CARB only adopted placeholder targets, which will be revisited in 2012 o Valleywide placeholder reduction targets: 2020: 5% reduction (the 8 MPOs individually suggested between %1 to 6%) 2035: 10% reduction Remaining 6 MPOs: Monterey, Butte, San Luis Obispo, Santa Barbara, Shasta and Tahoe – the CARB adopted each MPO’s current projections and will revisit these numbers 2014 o Tahoe Metropolitan Planning Organization 2020: 7% reduction 2035: 6% increase o Shasta County Regional Transportation Planning Agency 23 2020: 0% reduction 2035: 0% reduction o Santa Barbara County Association of Governments 2020: 6% increase 2035: 4% increase o San Luis Obispo County Council of Governments 2020: 8% reduction 2035: 8% reduction o Butte County Association of Governments 2020: 0% reduction 2035: 1% reduction o Association of Monterey Bay Area Governments 2020: 13% increase 2035: 14% increase In the Staff Report, the CARB acknowledged, “a significant portion of the built environment in 2020 has been defined by decisions that have already been made.” (CARB, 201, p. 15.) The CARB also acknowledged the state of the land use environment: “The nationwide recession created significant uncertainties for local planning efforts in California. Economic assumptions that were made in the last round of housing and transportation plans are likely outdated. Furthermore, local governments have seen a decline in revenues, resources, and funding for planning and infrastructure investments. Planning departments rely on city or county general funds and on developer fees to fun staff positions. Both of these revenue sources suffered in recent years and many departments have cut back their planning staffs. In many cases, California cities and counties are being asked to do more with less, and planning efforts to look even five years into the future suffer as local governments 24 attempt to deal with more immediate needs.” (CARB, 2010, pp. 1516.) The CARB discussed various difficulties in establishing these targets, including: (1) regions’ limited ability to impact and control interregional travel (travel that passes entirely through the region); (2) the difficulty in measuring interregional travel; (3) significant variations among the MPOs’ travel demand models, their forecasting abilities and the models’ key assumptions; and (4) the fact that long-term planning is very difficult given the inherent uncertainty in various planning assumptions like the cost of travel. (CARB, 2010, pp. 11, 13, 16.) Table 3: RTP Adoption Dates by MPO MPO AMBAG Butte CAG Fresno (COFCG) Kern COG Kings CAG Madera CTC Merced CAG MTC San Joaquin COG San Luis Obispo SANDAG SACOG Santa Barbara SCAG Shasta CRTPA Stanislaus COG Tahoe RPA Tulare CAG Date of Current RTP 6/9/10 12/11/08 7/29/10 7/15/10 7/28/10 7/21/10 7/15/10 4/22/09 7/22/10 4/6/05 11/30/07 3/20/08 10/15/09 5/8/08 7/27/10 7/21/10 8/27/08 7/19/10 Source: CARB, 2010, p. 41 Estimated Date of Next Adopted RTP June 2012 December 2012 July 2014 July 2014 July 2014 July 2014 July 2014 April 2013 July 2014 December 2010 July 2011 December 2011 March 2013 May 2012 July 2015 July 2014 October 2012 July 2014 25 Further, the CARB did not express much anticipation of significant land use changes to achieve the GHG emissions reduction targets. Rather, the CARB said that the MPOs’ proposed scenarios “reflect the reality that more time is needed for large land use and transportation infrastructure changes, and show that most of the change expected in this time period will come from improving the efficiency of each region’s existing transportation network.” (CARB, 2010, p. 16.) Based on Table 3, the first SCS or APS will be adopted between December 2010 and 2011, with the majority of SCSs and APSs adopted closer to 2014. VI. Literature Review of S.B. 375 a) Bill Higgins (2009) After providing a brief overview of SB 375’s requirements, Bill Higgins from the League of California Cities recommended, a “MPO or county transportation agency must consider financial incentives for cities and counties that have resource areas or farmland.” (Higgins, 2009, p. 11.) He explained: “The idea is that to the extent that SB 375 drives more transportation investments to existing urban areas, some consideration should be given to rural areas that nevertheless help address the emissions targets by not building.” (Higgins, 2008, p. 11.) This proposition is well taken given the interconnection between counties’ fiscal and land use decisions. However, Mr. Higgins failed to provide any fiscal analysis to support his conclusion. 26 b) John Darakjian (2009) In 2009, John Darakjian contrasted the “slow growth” movement often favored by California voters with the “smart growth” promises of SB 375. Darakjian theorized developers and local governments would be receptive to SB 375 because “[w]here slow growth only tied the hands of developers and local governments, smart growth promises to give them new tools” by not “simply restrict[ing] development but also  redirect[ing] it.” (Darakjian, 2009, pp. 380381.) However, he identified various obstacles to implementation of the law. First, Darakjian pointed to the lack of transportation infrastructure and funding to support the expected higher density housing. (Darakjian, 2009, p. 396.) Additionally, there is no requirement that SCS-compliant developments have masstransit infrastructure and the bill does not mandate additional public transit infrastructure or maintenance funding. (Darakjian, 2009, p. 396.) The second obstacle is the lack of direct authority for the MPOs under the bill. (Darakjian, 2009, p. 398.) The third obstacle is California’s budget woes, which resulted in the Sacramento Regional Transit to announce cutting services and increasing fees in August 2008. (Darakjian, 2009, p. 398.) The fourth obstacle is that “a claim of infeasibility by any of California’s 17 MPOs will effectively place that region outside the reach of significant portions of the statute.” (Darakjian, 2009, p. 399.) 27 Darakjian’s recommendations included: (1) peak-hour toll charges on main thoroughfares; (2) imposing a feebate system for new vehicles falling below some fuel economy benchmark; (3) extending the CEQA exemptions to projects other than residential development; and (4) the CARB establishing clear guidelines to assist local governments in quantification of emissions reductions. (Darakjian, 2009, pp. 407-409.) Mr. Darakjian’s review of SB 375 provides interesting recommendations; however, he fails to provide or include any analysis with regard to the potential barriers to the implementation of SB 375 to support his findings or recommendations. c) Henry Stern (2008) Stern reviewed AB 32 and briefly discussed his concerns regarding SB 375. He said, “there remains the open question of how reductions achieved to meet these regional ‘targets’ would count towards statewide emissions ‘limits’ under AB 32.” (Stern, 2008, p. 634.) Further, he was concerned that “this bill runs the risk that CARB would set regional targets insufficiently aggressive, thereby unlocking valuable transportation financing dollars for localities that did little to advance statewide goals under AB 32. (Stern, 2008, pp. 635-635.) Similar to the literary works discussed above, Mr. Stern provided no qualitative or quantitative analysis to support his findings. 28 d) Urban Land Institute (2010) The Urban Land Institute believes SB 375 will: (1) provide more consistency, coordination and clarity to the development process and land use planning; (2) provide a greater balance between infill and Greenfield development; (3) include positive net revenues to local governments through the reduction of per capita service costs; (4) increased property values; and (5) sustained agricultural economies. (Urban Land Institute, 2010, pp. 5, 7.) However, the Urban Land Institute acknowledged, “infrastructure expansion in existing urban areas can be more complex, more expensive and more difficult to finance than conventional Greenfield development.” (Urban Land Institute, 2010, pp. 5, 7.) The Urban Land Institute supports such infrastructure, stating that “the marginal increase in costs is outweighed by the long-term municipal savings generated over the life of the infrastructure.” (Urban Land Institute, 2010, p. 8.) Regarding transit funding, the Urban Land Institute believes the “current system of funding public transit has created unintended fluctuations in annual budgets that inhibit the effective longterm planning of investment in capital and operations” which has “resulted in reductions in service levels and coverage.” (Urban Land Institute, 2010, p. 10.) To stabilize public transit funding, the Urban Land Institute suggested “various financing tools could be leveraged, which included, but are not limited to: (1) tax increment financing for transit districts/state areas; (2) congestion pricing; (3) VMT 29 fees; (4) variable parking pricing; (5) fuel taxes; (6) the use of public-private partnerships; and (7) value capture financing.” (Urban Land Institute, 2010, p. 10.) Further, the Urban Land Institute suggested “[i]mprovements to transit service, especially in the form of increased safety, improved on-time performance, improved customer service, and ease of making a connection, can help make transit a better alternative to these users.” (Urban Land Institute, 2010, p. 10.) The Urban Land Institute identified six key problems with the bill: (1) inherent conflicts between the federal, state, regional and local regulatory requirements (i.e. flood zones, school location, etc.); (2) local governments have a fiscal disincentive to build more housing close to employment centers due to the allocation of tax revenue; (3) the bill focuses on the development of housing for specific demographics and should not make other preferences unattainable; (4) lack of linking between infrastructure investments and directed future growth; (5) financing infrastructure expansion in existing communities may be more complex and expensive of a per unit basis; and (6) need for cross-MPO coordinate due to the connection of employment and housing in metropolitan regions to each other. (Urban Land Institute, 2010, pp. 11-12.) With regards to the CEQA streamlining provisions, the Urban Land Institute suggests the provisions be “expanded to include projects that offer employment opportunities” and be expanded to include projects that can achieve 30 GHG reduction targets similar to Transit Priority Projects. (Urban Land Institute, 2010, p. 14.) The Urban Land Institute provides detailed recommendations and identifies key concerns with regard to SB 375’s implementation. This study, however, lacks any meaningful analysis with regard to the impact of this Bill on the California counties who are charged with implementing these goals. In the absence of evaluating the effect of the Bill at the base level of implementation, one cannot evaluate the possibility of successful implementation. Therefore, this review falls short of connecting the proposed pitfalls with actual analysis of present conditions and barriers to the Bill’s implementation. e) Brent Schoradt (2009) In 2009, Brent Schoradt reviewed SB 375 and determined that the “ultimate success of SB 375 will depend on the willingness of metropolitan planning organizations to adopt sustainable communities strategies that meet GHG reduction targets.” (Schoradt, 2009, p. 611.) Schoradt explained that “[b]y excluding the [APS] from the [RTP], SB 375 does not prevent state and federal transportation funds from flowing to transportation projects, such as highway expansions, that increase GHG emissions.” (Schoradt, 2009, p. 614.) Therefore, Schoradt believes that, to the extent MPOs adopt APSs rather than SCSs, SB 375 will fail to further any land use changes. 31 As explained further in this Thesis, Mr. Schoradt’s opinion is well taken. However, similar to the above scholars’ works, the review lacks any meaningful analysis of either qualitative or qualitative impacts on the implementation of this Bill at the county level. f) Greg Greenway (2010) In 2010, Greenway reviewed the public participation requirements under SB 375 and discussed how the 2008 San Mateo civic commitment initiative may provide positive support for the implementation of SB 375 projects. The author suggested that, “[t]o bring its landmark climate change strategy to life, SB 375 needs an implementation plan.” (Greenway, 2010, p. 463.) The implementation plan would “include guidance, resources and tools that local governments can use to engage their citizens every time they make significant land use decisions.” (Greenway, 2010, p. 463.) However, he acknowledged that the public participation/engagement that would be necessary to implement this incentivebased initiative might appear prohibitively expensive, in light of the current economic environment in California and throughout the US. (Greenway, 2010, p. 463.) Mr. Greenway acknowledged the difficulty in the implementation of the Bill given the present economic climate in California. Such factors are important to consider in evaluating the potential success of the Bill as drafted. Although Mr. Greenway acknowledges this limitation, he provides no meaningful analysis to 32 support his theories or recommendations. To determine whether public participation or engagement would facilitate implementation of the Bill, one must first analyze the present public opinions. Thus, this analysis fails to provide any meaningful analysis to further evaluation of SB 375’s implementation. VII. Defining the Problem This Thesis seeks to determine whether SB 375 will successfully change land use development patterns in California. First, I will discuss two primary barriers to the implementation of SB 375’s proposed higher-density, infill development: (1) fiscal barriers, and (2) political barriers. Although various authors have provided explanations of SB 375’s obstacles and discussed various recommendations, none of the authors attempted to provide an in-depth analysis of the above-referenced two barriers to the bill’s implementation. These barriers are important given their direct impact on land use decisions. Indeed, counties often make land use decisions based on political pressures and in furtherance of increasing tax revenues. Given the present political and economic climate, these factors are more important than ever in counties’ land use decisions. More importantly, as discussed under the Literature Review section of this Thesis, no other study provides meaningful analysis of the qualitative and qualitative barriers to the Bill’s implementation. Although some of the reviews provide insight into the potential success of SB 375’s implementation, such comments are hollow in the absence of a thorough and detailed analysis of the factors that impact counties’ land 33 use decisions the most – fiscal and political barriers. Therefore, this Thesis will use quantitative and qualitative data to discuss each of these two important barriers. Because each barrier (each chapter) stands alone, each chapter includes an introduction, analysis and conclusion. To further provide insight into the Bill’s potential for successful implementation, this Thesis provides a case study of the specific barriers and concerns with regard to SB 375’s implementation in the San Joaquin Valley counties. Because the San Joaquin Valley counties will incur the greatest growth through 2050, these counties may have a significant impact on the potential success of SB 375. Presently, the CARB is treating the eight San Joaquin Valley counties alike by setting the same placeholder target for each of these MPOs. This Thesis will use quantitative and qualitative data to discuss whether the San Joaquin counties will meet the CARB’s targets, and whether any specific barriers within the individual counties may inhibit successful implementation of SB 375. 34 Chapter 2 FISCAL CONSTRAINTS I. Introduction This chapter discusses the fiscal constraints to local governments’ implementation of the SB 375 objectives. The fiscalization of local land use decisions describes how local governments have employed “land use regulation to increase local revenue streams.” (Lewis, 2001, p. 4) Following 1978, when California passed Proposition 13, a constitutional amendment to limit the property tax rate and annual tax increases, local governments have focused on retail and commercial development rather than residential development to increase their tax base. This chapter concludes that the land use patterns in California are unlikely to change in the near future without some additional fiscal incentives for local governments. II. Background a) Proposition 13 – Limits on Local Property Tax Revenues In 1978, California overwhelmingly passed Proposition 13 in response to growing concerns about escalating housing values and property taxes. (PPIC, June 2008, p. 1) The initiative “limits the property tax rate to 1% of the assessed value of the home at the time of purchase and holds annual tax increases to no more than 2% until the property is sold.” (PPIC, June 2008, p. 1) Further, only a two-thirds 35 vote of the legislature could impose new state tax increases and a two-thirds vote by the voters would allow local special tax approval. (PPIC, June 2008, p. 1) This resulted in a dramatic decrease in local property tax revenue to counties, cities, and schools because, prior to the proposition, property taxes had been the largest revenue sources for local and state governments. (PPIC, June 2008, p. 1.) In addition to the limits on the property tax assessment, “[f]or the first time in the state’s history, the state was put in charge of allocating the proceeds of the locally levied property tax, with the rate and base defined by the statewide initiative.” (Chapman, Sept. 1998, p. 3.) Therefore, Proposition 13 “effectively transferred control of the property tax from local governments to the state government.” (Shires, 1999, p. 7.) Although local governments impose, assess and collect property taxes, the state determines the fair allocation of the taxes among competing interests. (Shires, 1999, pp. 14-15.) In 1998, the Legislature adopted AB 8 to determine the allocation of tax receipts. (Chapman, Sept. 1998, p. 4.) Although AB 8 has undergone multiple revisions, it is still the basic operating legislation. (Chapman, Sept. 1998, p. 4.) The state further shifted additional property taxes away from cities and counties to fund school districts. (Lewis, 2001, p. 21.) Although support for Proposition 13 has remained high, California residents are divided over the impact of the property tax limitations on local government services. (PPIC, June 2008, p. 1.) 36 Proposition 13 and subsequent initiatives to constrain local government’s ability to raise revenues locally reflects two policies: (1) “a desire to control and limit the size of California’s governments,” and (2) “a basic distrust of representative government: a belief that elected officials are, in practice, incapable of imposing the public’s will when it comes to taxation and spending.” (Shires and Habers, 1997, pp. 2-3.) b) Responses to Proposition 13 Due to Proposition 13, local governments have become increasing dependent on the state for revenue. However, the state has proven to be an unreliable source of local revenue. In 1993, the state shifted $3.6 billion away from local governments under Proposition 98. Between 2004-2006, Governor Schwarzenegger shifted another $1.3 billion from local governments to the state coffers for each budget year. In response to the fiscal uncertainty, local governments have focused on sales-tax generating development such as “big box” retail, shopping malls and car dealerships. (Stern, 2008, p. 618.) Further, local governments have started to rely more on user fees, charges, and sales and gross receipts tax increases. (Edwards, 2005, p. 18.) Under the Bradley-Burns Sales Tax and Use Act of 1955, California local governments receive 1% of the sales receipts collected in their jurisdictions. Local governments’ need for revenue has highlighted the importance of land use decisions, because “land use decisions have fiscal consequences and fiscal 37 decisions have land use consequences.” (Detwiler, 2001, p. 3.) Each form of land use has attendant consequences on local government costs, in the form of expenditure for infrastructure and services, and revenue, in different forms of taxes or fees. Currently, California employs a situs-based method of allocating sales taxes. The situs-based method essentially allocates taxes to the jurisdictions in which the taxes are collected. Therefore, the more taxes collected in a county, the greater percentage in tax revenue that county receives. Research indicates that the situs-based method of allocating sales taxes, where a portion of the tax revenue stays in the revenue-generating jurisdiction, incentivizes local officials to promote retail developments. (Detwiler, 2001, p. 6.) Some studies indicate that retail development generates a fiscal surplus (revenue exceeding the cost of services) in contrast to competing land uses like residential and industrial. (Wassmer, 2002, p. 1310.) Further, the interaction between job growth and population growth furthers the connection between local government reliance on sales taxes and sprawl – job growth leads to population growth and population growth in an area leads to job growth. (Carlino, 1985; Carlino and Mills, 1987; Glaeser and Kahn, 2001.) In a recent survey of 330 California cities, “new sales tax revenues generated” ranked first in motivation for new development, and was tied with “city council support for the project” for redevelopment projects. (Lewis and Barbour, 1999.) The two most popular sales-tax-generating enterprises from a small area are “big-box” retail and car dealerships. (Chapman, 1998, pp. 11-12.) 38 III. Literature Review a) Michael Shires et al. (1998) In 1998, Michael Shires et al. prepared a report detailing the public revenue burden in California, using the time period between 1978 and 1995. (Shires et al., 1998, p. 17.) For counties, the report used the California State Controller’s Annual Reports. (Shires et al., 1998, p. 20.) The study found “that the largest revenue source for state and local government is generally taxes, but that their importance declined overall immediately after Proposition 13 and has remained relatively flat since.” (Shires et al., 1998, p. 31.) The study concluded that “[b]ecause a large share of state and local revenues is derived from taxes, it is unlikely that state and local governments will experience funding shortfalls during periods of high economic growth, when tax coffers swell. In recessionary periods, however, the ability to raise additional revenues through increased license fees, service charges and user fees – state and local governments’ response during the last recession – will be constrained by both Proposition 218 and their extensive use during the last recession. This combination could leave California’s state and local budgets sensitive to economic shocks and could result in reduction in public support for discretionary programs, such as higher education, with the onset of a future recession.” (Shires et al., 1998, p. 64.) This study is important given that SB 375 was enacted in a recessionary period, in which local governments and the state are experiencing significant financial difficulties. 39 b) Michael Shires (1999) In 1999, Michael Shires undertook a study to determine the changes in state and local finance trends since Proposition 13 (not necessarily as a result of Proposition 13). (Shires, 1999, pp. 2-3.) The report showed “the locus of state and local decisionmaking about revenues has generally shifted from local governments to the state government.” (Shires, 1999, p. 61.) Shires’ study found that “counties have taken the biggest hit of any local unit of government” in the wake of Proposition 13, making the counties “vulnerable to fiscal crises during statewide downturns in the economy.” (Shires, 1999, p. iv.) Between 1978 and 1995, county discretionary revenues declined from 57 percent to 31 percent. (Shires, 1999, p. 33.) The study predicted that “the expanded imposition of statewide ‘average’ preferences on local communities, coupled with the constraints on new revenues . . ., [would] make it increasingly difficult for local communities to specify, finance, and exhibit their local preferences for mixes of services and programs.” (Shires, 1999, p. 36.) The study showed an increase in counties’ dependence on intergovernmental revenues, reinforcing counties’ “agency role” to implement the policies, programs, and initiatives of state and federal governments. (Shires, 1999, p. 45, fn. 5.) The study concluded the “agency role of the counties has led to a sharp decrease in their share of discretionary revenues.” (Shires, 1999, p. 45.) “The overall result has been a marginalization of the role of the locally elected county 40 governments and, consequently, of local preferences.” (Shires, 1999, p. 57.) Overall, the loss of local discretion and the imposition of user fees “has generally increased the overall political tensions in the state between different levels of government.” (Shires, 1999, p. 63.) c) David J. Edwards (2005) In his 2005 thesis at California State University, Sacramento, David Edwards analyzed whether the fiscal aspects associated with land-use cause urban sprawl. His thesis consisted of a multiple regression analysis based on U.S. Census 2000 data, comparing “statewide measures of municipal and county government own-source revenue reliance on sales taxes, property taxes, income taxes and other types of taxes” to the land area size of the 452 census-defined urbanized areas. (Edwards, 2005, p. 2.) The broad study found statistical significance between increased municipal own-source revenue reliance on property taxes or sales taxes and increases in the land area size of urbanized areas. (Edwards, 2005, p. 74.) Edwards concluded: “Authority over land use coupled with the ability to retain portions of the property taxes and sales taxes generated within their jurisdictions is resulting in local governments manipulating land use to increase revenue.” (Edwards, 2005, p. 74.) This study supports prior findings that local governments’ fiscal incentives define the spatial growth or sprawl of their urban areas. (Edwards, 2005, p. 75.) 41 Importantly, Edwards found that a one percent increase in own-source revenue from property taxes translates to 64 additional acres of development. (Edwards, 2005, p. 68.) Further, a 10 percent increase in county own-source revenue from sales taxes resulted in approximately 530 acres of additional development. (Edwards, 2005, p. 68.) Edwards concluded that “county sales taxes provide a sizeable impetus for sprawl.” (Edwards, 2005, p. 68.) d) Paul G. Lewis (2001) California employs the so-called “situs jurisdiction” for sales tax revenues. A “situs jurisdiction” apportions sales tax revenue based on the location where the revenue is generated. (Lewis, 2001, p. 21.) Thus, local jurisdictions with greater tax generation receive a greater proportion of sales tax revenue from the State. After Proposition 13, cities responded to the loss of property taxes by increasing their income from fees, assessments and license charges. (Lewis, 2001, pp. 22-23.) Further, competition for sales tax revenues, particularly retail land uses, increased. (Lewis, 2001, p. 23.) Lewis’ study consisted of surveys sent to top administrative officials in 471 California cities in late 1998, with usable survey responses from 330 cities. (Lewis, 2001, p. 26.) The surveys showed retail development as the most favored type of land use for both vacant land and redevelopment, with office development being a close runner-up. (Lewis, 2001, p. 26.) The least desirable land use projects were residential and heavy industrial. (Lewis, 2001, p. 26.) 42 Regarding incentives, cities ranked retail uses the most likely to receive incentives in their communities, with light industrial ranked second. (Lewis, 2001, p. 26.) The key motivation for new development on vacant land was “new sales tax revenues generated.” (Lewis, 2001, pp. 27-28.) Based on these results, Lewis concluded “such factors as job creation, industrial development, or affordable housing provision lags behind.” (Lewis, 2001, p. 28.) However, although local policies or incentives indicate a preference for retail land uses, Lewis concluded such preferences would unlikely change the volume of retail in California, because market economic factors determine the level to which a community can support retailers. (Lewis, 2001, p. 28.) Therefore, he found the preferences resulted in “largely a fiscalization of municipalities’ land-use orientations rather than a fiscalization of land-use outcomes.” (Lewis, 2001, p. 31.) IV. Data The three main sources of financial information for local governments are the U.S. Department of Commerce’s Census of Governments, the California State Board of Equalization and the California State Controller’s Annual Report. (Shires and Habers, 1997, p. 8.) My analysis of counties’ fiscalization of land use is based on data from the California State Controller’s Annual Reports and the California State Board of Equalization’s Annual Reports, as discussed further below. This analysis does not include data from the U.S. Department of Commerce’s Census of 43 Governments, because “the data underlying the Census reports are largely those included in the Controller’s reports.” (Shires and Habers, 1997, p. 12.) a) California State Controller’s Office Annual Reports The California State Controller’s Office collects annual information of local government financial activity that “includes revenue, expenditure and debt information” for each county. (Shires and Habers, 1997, pp. 9-10.) In 1997, Shires and Habers undertook a study to determine the reliability of the local public finance data published by the California State Controller’s Office each year. The study’s purpose was to ensure the reliability of data used in subsequent studies regarding “how California’s political institutions and processes affect policy outcomes” in the wake of Proposition 13 and other revenue-and-expenditure-limiting initiatives. (Shires and Habers, 1997, p. iii.) Regarding the revenue data pertinent to this analysis, the study concluded the State Controller’s data “are highly accurate in their portrayal of the revenues raised and received” by local governments. (Shires and Habers, 1997, pp. 85-86.) Therefore, this analysis includes revenue data derived from the State Controller’s Annual Reports. b) California State Board of Equalization The California State Board of Equalization’s Annual Report provides detailed information on state, city and county tax receipts (including property and sales taxes) on an annual basis. The data is reliable because the State Board of Equalization is “the primary tax collector and distributor for the sales tax, the fuel 44 tax, the alcoholic beverage tax and the cigarette tax.” (Shires and Habers, 1997, p. 10.) Therefore, my analysis includes sales and use tax data from the State Board of Equalization. V. Methodology My analysis will focus on the changes in county revenue between 1998 – 2008 to determine how and whether the proportion of county revenue changed by revenue category. The purpose of this analysis is to determine whether counties have an equal or greater interest in one type of development over another. This analysis assumes counties would have a greater preference for “general discretion revenues,” such as property tax and sales tax, because (unlike other taxes constrained by statute or the constitution for specific purposes) these taxes may be spent for any purpose. (Shires, 1999, p. 31.) VI. Analysis a) Homeowners’ Property Taxes As shown in Table 4, between 1998 and 2008, counties experienced a significant decrease in the percentage of homeowners’ property taxes allocated to them by the state of California. In fact, the data shows a consistent decrease in the proportion of homeowners’ property taxes allocated as a part of the total “County Taxes Allocated” by the State from 1.67% in 1998 to only 0.89% in 2008. This decrease in the proportion of homeowners’ property taxes in comparison to other 45 “County Taxes Allocated” supports literature that local governments likely do not favor revenue from homeowners’ property taxes. b) Revenue from State and Federal Government Agencies As shown in Table 5, between 1998 and 2008, counties experienced a significant decrease in the percentage of revenue from state and federal government agencies in proportion to their revenues. In fact, the data shows a consistent decrease in the proportion of state and federal revenues received by counties as a part of the total “County Revenue.” Between 1998 and 2008, the state agencies’ allocations to counties decreased as a percentage of their total revenue from 37.22% to 32.39%. Similarly, the federal agencies’ allocations decreased from 23.15% to 19.24%. Additionally, the table shows an actual decrease in the money received from the state’s agencies over various years. This data illustrates that revenue received from state and federal agencies has decreased as a percentage of counties’ overall revenue. Therefore, counties must augment these losses by generating revenues in other categories. c) Revenue from Property Taxes Although Table 4 shows a decrease in the proportion of homeowners’ property taxes allocated in comparison to other “County Taxes Allocated,” between 1998 and 2008, property taxes still remain a large percentage of counties’ revenue. Table 6 illustrates the proportion of revenues generated from property taxes. Between 1998 and 2008, the proportion of property taxes increased from 12.42% to 46 15.36% of the counties’ revenue stream. It is important to note that this number is not solely homeowners’ property taxes, which are restricted by Proposition 13 (as analyzed in Table 4). Rather, this figure includes all taxes generated from government and private properties. Table 4: Changes in Homeowner Property Tax Allocation 1998-2008 Homeowners % Change in Homeowner Taxes Allocated Total County Taxes Allocated $327,992,688 $72,047,195 1.67% $4,312,909,124 $4,257,232,809 $360,346,183 $74,148,161 1.58% $4,691,727,153 2000-2001 $4,631,689,371 $300,685,827 $73,388,410 1.47% $5,005,763,608 2001-2002 $4,950,627,071 $311,728,629 $73,529,474 1.38% $5,335,885,174 2002-2003 $5,284,440,169 $332,949,645 $73,997,349 1.30% $5,691,387,163 2003-2004 $5,475,887,426 $363,334,755 $74,336,555 1.26% $5,913,558,736 2004-2005 $5,825,273,483 $405,418,386 $72,566,149 1.15% $6,303,258,018 2005-2006 $6,720,477,416 $463,555,336 $72,645,492 1.00% $7,256,678,244 2006-2007 $7,299,078,760 $505,327,786 $72,977,758 0.93% $7,877,384,304 2007-2008 $7,653,724,845 $522,742,014 $73,347,456 0.89% $8,249,814,315 Secured and Unsecured County Taxes Allocated Less than County Wide 1998-1999 $3,912,869,241 1999-2000 Source: California State Controller’s Office Graph 1: Percentage Change in Homeowner Property Tax Allocation 1998-2008 47 Table 5: Revenue from State and Federal Government Agencies State Gov't Agencies % Revenue from State Gov't Federal Gov't Agencies % Revenue from Federal Gov't $30,184,467,950 $11,234,337,743 37.22% $6,988,407,717 23.15% $32,976,162,236 $12,579,548,507 38.15% $7,450,263,872 22.59% 2000-2001 $35,641,837,574 $14,155,075,659 39.71% $7,827,475,204 21.96% 2001-2002 $39,372,464,325 $15,447,535,728 39.23% $8,652,657,783 21.98% 2002-2003 $40,907,305,034 $15,746,977,711 38.49% $8,592,626,735 21.01% 2003-2004 $41,731,216,542 $15,575,759,919 37.32% $8,675,560,895 20.79% 2004-2005 $44,009,960,903 $15,316,478,894 34.80% $8,468,779,248 19.24% 2005-2006 $46,198,676,999 $15,891,786,334 34.40% $8,666,217,634 18.76% 2006-2007 $48,369,794,446 $16,250,819,366 33.60% $9,018,388,457 18.64% 2007-2008 $50,706,824,034 $16,371,624,221 32.29% $9,754,980,712 19.24% Fiscal Year Total Financing Sources and Transfers In 1998-1999 1999-2000 Source: California State Controller’s Office Graph 2: Percentage Revenue from State and Federal Governments This increase in the proportion of property taxes to counties’ revenue is important when considering the political impact property taxes changes may have 48 on local governments’ willingness to cooperate with the state. To the extent local governments’ can control local land use decisions to maximize property tax allocations, they are likely to do so. To the extent SB 375 is inconsistent with the maximizing of these revenues, local governments will likely ignore the bill’s goals. Table 6: Revenue from All Property Taxes Fiscal Year Property Tax Total County Revenue (in Thousands) % of Total County Revenues 1998-1999 $3,666,926 $29,524,364 12.42% 1999-2000 $3,902,326 $32,438,288 12.03% 2000-2001 $4,252,508 $34,799,574 12.22% 2001-2002 $4,587,927 $38,684,039 11.86% 2002-2003 $4,908,687 $40,235,139 12.20% 2003-2004 $5,229,239 $40,949,405 12.77% 2004-2005 $5,598,353 $43,335,289 12.92% 2005-2006 $6,366,914 $45,958,406 13.85% 2006-2007 $7,223,239 $48,174,954 14.99% 2007-2008 $7,739,782 $50,394,471 15.36% Source: California State Controller’s Office and Board of Equalization Graph 3: Percentage of Property Taxes as Part of County Revenues 49 VII. Conclusion This section analyzed the fiscal constraints on the implementation of SB 375. The above data demonstrates that property taxes are a very important (and seeming increasingly important) revenue stream for counties. However, homeowners’ property tax allocations as a percentage of County allocated taxes are actually decreasing. Therefore, these increases in property tax allocations likely reflect counties’ management of land use decisions. Further, the data shows that state and federal fund allocations to counties have steadily decreased over the past 10 years. This decrease and the increasing importance of property taxes to counties’ revenue streams likely mean that counties will place even greater reliance on its local land use decisions to fund its operations. To the extent the county can allocate land use development to increase property taxes, the county will likely do so. Due to the apparent importance of such land use decisions, counties will likely disregard SB 375’s goals if they conflict with the maximization of property tax revenues. In light of these findings, recommendations increasing counties’ revenue from other sources would likely be the best motivation to comply with SB 375. Such recommendations include: congestion pricing through peak-hour toll charges, VMT fees through a feebate system, tax increment financing for transit oriented areas, variable parking pricing, and other financing methods. Further, to the extent counties seek commercial and retail development closer to residences, the state 50 could consider extending the CEQA streamlining to such projects. This would secure cooperation by the counties by increasing their revenue stream, while at the same time encouraging the goals of SB 375. By building commercial and retail developments closer to existing residential developments, the state would encourage less vehicle travel, and thus less GHG emissions. In conjunction with such developments, the state should provide additional financing to support transit development to facilitate public transport between the existing residences and the new commercial/retail developments. SB 375 seems to overlook an important fact: urban sprawl in the form of residential developments is existent and cannot be reversed. Specifically, people are less likely to leave their suburban homes to move to the inner-city to be closer to their jobs. This is true especially given the increase in resale homes and foreclosures on the market in recent years. Therefore, SB 375’s requirements will have little impact on the majority of the present working population. In order to influence the travel behaviors of the work force, perhaps the focus should be on moving employment facilities closer to the sprawled areas to minimize VMT. If the Bill were to provide incentives and support for counties to entice businesses into the sprawled areas, counties may be more willing to comply with the SB 375 requirements. More importantly, increasing employment centers close to existing homes may actually further SB 375’s goals, because a homeowner is more likely to change jobs than to sell his/her home, especially if the home is located in a 51 desirable school district. It is more difficult to uproot an entire family with established friends, schools, and neighborhood and community obligations, than to uproot a single family member by providing similar or better job opportunities. Further, given the economic climate and the decrease in homebuilding in the California over the past 5 years (and little growth in the foreseeable future), the focus of SB 375 seems misplaced. It is important to note that land development generally takes years. Indeed, homebuilders generally have to proceed through various red-tape procedures to get to land development (including CEQA, tentative map, final map, Department of Real Estate public report requirements, and many more city, county and state requirements). Moreover, in recent years, land development has been plagued by various lawsuits related to endangered species. Thus, most of the land development in the current pipeline for 2011 through 2020 have most likely already been approved or are far enough in the process that any changes consistent with SB 375 may create significant cost exposure. As such, SB 375’s requirements may have little impact on land development and land use decisions in the near future. 52 Chapter 3 POLITICAL CONSTRAINTS I. Introduction Land use planning is a political issue. Elected officials must balance the needs/wants of their constituents in a public forum. The political nature of planning makes it inherently susceptible to manipulation by interested individuals and groups. (Fulton, 1999.) Local governments are more responsive to local preferences than the State “because people are more likely to know their city councilmembers and are better able to assess their behaviors and successes at election time than they are with their more distantly connected county, state, or federal representatives.” (Shires, 1999, p. 10, fn. 4.) This section analyzes the political constraints to the implementation of the SB 375 land use development proposals. Specifically, this section will review the historical non-compliance by local governments with the Housing Element Law and the structure of the MPOs as a barrier to SB 375 implementation. II. Housing Element Law SB 375 attempts to focus local attention on regional issues, which may be difficult especially when local and regional interests conflicts. Currently, the only required general plan element that attempts to do this is the housing element. Thus, the issues associated with the housing element may provide insight into the 53 problems that could potentially plague a good faith attempt to implement the SB 375 requirements. a) Overview: Housing Element Law Requirements and Process California’s Housing Element Law (Government Code §§ 65580-65589.8), also known as the “fair-share” housing law, was enacted in 1969 and is “the major means by which the state government tries to ensure that local land-use regulators are dealing with unmet housing needs and planning appropriately for new housing development.” (Lewis, 2003, p. 1.) The housing element is one of the seven required elements of each city/county’s general plan, identifying current and future local housing needs for all income groups and preparing a schedule to meet such needs. (Lewis, 2003, pp. 1-2.) These plans “determine where housing, especially low- and moderate-income units, should be built within a region according to such criteria as placing housing where it will expand housing opportunity, where it is most needed, and where it is most suitable.” (Listokin, 1976, p. 1.) The state used the housing element law to encourage local planning for the more fiscally burdensome residential development, rather than the retail and commercial development favored by local policymakers for their local sales tax revenues. (Lewis, 2003, p. 13.) Further, the regional needs assessment “redistribute[s] the burdens of lower-income households more equitably across geographic areas.” (Lewis, 2003, p. 18.) The philosophy behind the local housing 54 plans is to direct local “police power” toward the general welfare of the region, rather than the just the specific locality. (Listokin, 1976, p. 19.) Prior to SB 375, the regional MPOs allocated the state’s housing needs according to the “fair share” standard, a top-down approach based on federally generated population predictions. (Darakjian, 2009, 394.) The California Department of Housing and Community Development (HCD) sets regional housing targets based on the Department of Finance’s population projections. “In a process called the Regional Housing Needs Assessment (RHNA), the council of governments (a planning body representing the cities and counties in a given metropolitan area) must allocate this total number of housing units among the cities and unincorporated county areas in its region.” (Lewis, 2003, p. 2.) The council of governments (COG) must consider several factors during its local allocation of housing growth goals, such as market demand for housing, employment opportunities, availability of suitable sites and services, commuting patterns, farmworker housing needs and the type and tenure of housing need. (Lewis, 2003, p. 17.) The local communities must then identify “sufficient physical capacity to accommodate projected housing needs” and must provide “a detailed land inventory, summarizing the number of acres zoned for various types of residential development and for nonresidential uses.” (Lewis, 2003, p. 19.) In the local government’s five-year action plan, it must “identify a sufficient set of potential sites for future housing development that could accommodate the 55 community’s need ‘by right’ – that is, without requiring a conditional use permit or imposing vague conditions on potential homebuilders.” (Lewis, 2003, p. 19.) A shortage of buildable land “does not relieve a locality of its responsibility to provide adequate sites for new residential development.” (Lewis, 2003, p. 19.) These localities should look to changes in land use, annexation, upzoning, a second unit ordinance, redevelopment policy or infrastructure improvements to increase the development potential of their land base. (Lewis, 2003, p. 20.) Local officials believe the suggested changes to intensify land use conflict with other policy considerations, such as lack of water or sewer capacity, traffic congestion, existing land uses (such as industrial or commercial) or seismic, flooding or other natural hazards. (Lewis, 2003, p. 20.) The HCD reviews each local government’s housing plan to determine whether the plans would meet each community’s goal for new housing units. (Lewis, 2003, p. 2.) “The housing element is the only part of local general plans that is subject to substantial oversight by the state” because housing is considered a matter of vital statewide importance. (Lewis, 2003, pp. 2, 19.) If the plan meets the statutory requirements, HCD certifies the housing element. (Lewis, 2003, p. 3.) If it does not meet the requirements, HCD may provide suggestions to the local government. (Lewis, 2003, p. 3.) However, the local government may adopt the housing element plan without HCD’s certification and without incorporating HCD’s suggestions. (Lewis, 2003, p. 3.) These plans are “out of compliance.” 56 (Lewis, 2003, p. 3.) Although the HCD’s review of local housing elements is only “advisory,” the “carrot/stick” provisions in the law seek to encourage cities and counties to seek HCD’s certification of their plans. (Lewis, 2003, p. 3.) The so-called “carrot” for local governments to gain HCD’s certification of the housing element is the presumed legal validity of the plan upon certification (making it more difficult for parties seeking to invalidate the plan through legal action). (Lewis, 2003, p. 3.) The housing element law’s “stick” to encourage certification is the inability of noncompliant local governments to qualify for certain affordable housing and to participate in certain housing and community development grants. (Lewis, 2003, p. 3.) In 2001-2002, Senate Bill 910 was introduced to provide greater “teeth” in the housing element law through state fines on local governments for delayed or noncompliant local housing plans. The bill died in the assembly and the housing element law failed to add another stick to combat local noncompliance. (Lewis, 2003, pp. 32-33.) The failure of SB 910 “illustrates the long-simmering standoff between state and local officials.” (Lewis, 2003, p. 34.) “Housing element policy and enforcement has become a prominent source of intergovernmental antagonism.” (Lewis, 2003, p. 34.) b) Controversies Over Local Government Noncompliance Some state officials believe local governments “are not energetic enough in planning for housing and are trying to deflect their fair share onto other 57 jurisdictions.” (Lewis, 2003, p. 2.) In response, local officials claim: (1) the HCD’s RHNA targets “are poorly justified, unrealistic, and unresponsive to the physical limitations of their communities”; and (2) “affordable housing production is stymied by both high land costs and the lack of state and federal funds for this purpose. (Lewis, 2003, pp. 2-3.) State officials have sought to “beef up compliance with housing element law or penalize noncompliant local governments, whereas local officials [have sought] to protect local autonomy over land use.” (Lewis, 2003, p. 5.) Some county officials believe counties and cities should be treated differently in the housing element process, “given the greater capacity of incorporated cities to accommodate new growth” and counties’ protection of resource and agricultural lands. (Lewis, 2003, p. 28.) A Napa County supervisor said: “Consider the fact that we’re an agricultural county, and the fact that the state always laments the loss of agricultural land, and the fact that HCD equates agricultural land and open space as land available for housing.” (Lewis, 2003, p. 29.) Lewis identified four reasons that cities fail to comply with the housing element law: (1) community social status and exclusion of low-income housing; (2) local land-use characteristics (such as age of the housing stock and population density) and unavailability of vacant land; (3) the local government’s resources and planning capacity; and (4) local politics and residential growth policies (such as 58 reduction of residentially zoned land, annual limits or moratorium on building permits, and an official “population ceiling”). (Lewis, 2003, pp. 37As of September 25, 2002, “about one-third of all cities and more than onefifth of all counties” had noncompliant housing elements. (Lewis, 2003, pp. 3-4.) The problem with determining the noncompliance of various jurisdictions is the difference in “planning periods” among these jurisdictions. HCD breaks the regions down based on Planning Periods as follows: San Diego Association of Governments (SANDAG): 6/30/05-11 Southern California Association of Governments (SCAG): 6/30/08-14 Association of Bay Area Governments (ABAG): 12/31/01-09 Fresno County Governments, Kern County Council of Governments and Sacramento Council of Governments (SACOG): 6/30/08-13 Monterey Bay Area Governments (AMBAG): 12/31/02-09 All other local governments: 12/31/03-09 After reviewing the HCD’s annual reports to the California Senate and Assembly, I found the statistics set forth in Table 7 for the period between 2004 and 2008. Although the compliance numbers appear to trend upward between 2004 and 2007, 2008 presents a sharp decline in compliance. A more detailed review of the data suggested that a greater level of non-compliance is found at the beginning of the planning period. Therefore, because many jurisdictions’ planning periods 59 begin in 2008, this period has a lower level of compliance than the periods before. Although this data shows an increase in the general level of compliance, the data also shows a significant level of non-compliance by local governments in any given year. Table 7: Housing Element Law Compliance 2004-2008 Compliance 2004 2005 2006 2007 2008 In Compliance 68.00% 74.00% 77.80% 80.00% 45.79% Out of Compliance 13.00% 13.00% 10.30% 8.00% 5.05% Self-Certified 2.00% 0.00% 0.00% 0.00% 0.00% Under Review 5.00% 3.00% 2.40% 2.00% 8.04% 12.00% 10.00% 9.30% 10.00% 22.06% In Process Not Yet Due 0.20% Due 0.00% 19.07% Source: HCD In a 2009 study, California’s Housing Element Law was labeled as a “nearmodel program.” (Tars and Egleson, 2009, p. 211.) However, the authors explained, “the fatal flaw in the law is that it is a requirement to plan for, not necessarily produce, sufficient numbers of units to accommodate a city’s housing needs.” (Tars and Egleson, 2009, p. 211.) They suggested the best model to end homelessness would include the best aspects of California’s Housing Element law, “but also add an enforceable duty on municipalities to execute those plans, together with a corresponding commitment from federal, state and local governments to provide adequate funding.” (Tars and Egleson, 2009, p. 212.) A 2010 study echoed these criticisms of the Housing Element Law. The study cited two 60 fundamental problems with the housing element law: (1) the law requires local governments to plan for housing, but contains no enforcement element; and (2) the focus of the housing element law is on planning rather than focus, and local communities do not need to show that they complied with the planned housing projections. (Shanske, 2010, p. 708, fn. 130.) These criticisms seem to well supported by the historical non-compliance of local governments with the Housing Element Law. Lewis suggested the following alternatives or modifications to the Housing Element Law to further local governments’ compliance: (1) more penalties and prescriptions for local governments to meet the requirements of the law (such as financial penalties, legal action by the attorney general against noncompliant governments, and state-imposed “inclusionary zoning” requirements); (2) selfcertification based on performance; (3) subregional allocations and joint housing elements; (4) encouraging transfers of housing allocations among jurisdictions; (5) rewards for performance through regional impact fees on commercial development in job-heavy, housing-poor areas. (Lewis, 2003, pp. 71-76.) To the extent that SB 375 is similar to the Housing Element Law, the historical non-compliance of local governments foreshadow a similar response to the requirements of SB 375. 61 c) The Housing Element Law and SB 375 To determine whether SB 375 will likely follow in the same noncompliance footsteps as the Housing Element Law, I analyze the similarities and differences between the two laws. Under SB 375, local jurisdictions will adopt their RTP/SCS and regional housing allocation plans on the same schedule, every 8 years. (Government Code §§ 65588(b), 65588(e)(7)(C).) Further, the SCS must accommodate the predicted housing need in the RHNA, and the allocation plan zoning to accommodate the RHNA must be consistent with the development pattern in the SCS. (Government Code §§ 65584.04(i).) Within 3 years of adopting the housing element, the local jurisdiction must zone parcels of unused land pursuant to the RHNA. (Government Code §§ 65583(c)(1)(A).) SB 375 provides that if a locality fails to zone for low and very-low-income housing, it will be precluded from disapproving any general plan compliant affordable housing project. (Government Code § 65583(g)(1).) SB 375 introduced some teeth to the Housing Element Law by requiring local jurisdictions to complete all zoning consistent with the approved housing element within three years or face the risk of a suit. (Greenway, 2010, pp. 440-441.) Further, if “the approved housing element indicates a site is suitable for residential development but the jurisdiction has not completed the corresponding zoning, then authorities can deny an affordable project that meets the applicable standards only for health and safety 62 reasons.” (Greenway, 2010, p. 440.) Advocates of SB 375 believe this is one of the most important parts of the bill, because it aligns housing allocation, transportation planning and affordable housing. (Darakjian, 2009, p. 395.) However, SB 375 “did not change the way in which the housing element is adopted except to the extent that the regional housing allocation plan must be consistent with the SCS.” (Higgins, 2008, p. 15.) SB 375 is very similar to the Housing Element Law. Both laws are incentive-based. The Housing Element Law provides incentives through grants for affordable housing development, and SB 375 provides incentives through CEQA streamlining. Further, both laws are “planning” in nature, rather than actionoriented. Neither law requires the local governments to approve specific land development; the laws merely require them to plan for specific development. Additionally, neither law provides any serious penalties or fines for local government non-compliance. In these aspects, SB 375 seems to follow in the same path as the Housing Element Law. However, it is also important to look at the overall political environment. In November 2010, California elected Jerry Brown as the next Governor. During Governor Jerry Brown’s administration between 1975-1983, HCD took “a more aggressive posture toward the fair-share goals implied in the housing element law, by which each local government is expected to help solve regional housing shortfalls, particularly for low- and moderate-income households.” (Lewis, 2003, 63 p. 15.) Further, in 2007, while Jerry Brown was the California Attorney General, he sued the County of San Bernardino for the city’s failure to address climate change in its general plan update. (State ex rel. Brown v. County of San Bernardino (2007) No. CIVSS 0700329.) Although the case resolved in settlement, the impact of the suit was clear. In 2006, only two environmental assessment documents contained a discussion of climate change; compared to the 149 environmental assessment documents addressing climate change impacts in 2007. (Stern, 2008, p. 633, fn. 123.) From Jerry Brown’s prior actions in government, one could argue that he may take a more aggressive stand against non-compliant local governments than perhaps a different Governor. After all, the fear of litigation “is a major motivator for local governments in expending time and resources on housing elements.” (Lewis, 2003, p. 22.) Perhaps, in an effort to avoid costly and time-consuming litigation, local governments will be more inclined to comply with SB 375 during Governor Jerry Brown’s administration. III. MPO Political Structure SB 375 relies heavily on the cooperation of California’s 18 MPOs. As explained previously, each of the MPOs is responsible for drawing up the SCS or APS to meet the CARB’s regional GHG emissions reduction target. In order to draw up the SCS or APS, the MPO must work with its regional counties and cities to plan the regional land development patterns. Although regional planning, rather 64 than localized planning, provides various benefits in terms of resource allocation, minimizing externalities and fostering cooperation, it may also create difficulties in developing a comprehensive regional plan. “It is worth noting that the decision-makers on the regional MPOs are made up wholly of local elected officials.” (Higgins, 2008, p. 9.) These local elected officials are comprised from various cities and counties within the region. The regional organization must carry out the state mandate while, at the same time, satisfying the expectations of their local governments. This places the MPOs in a very difficult position and may present a serious political liability for a voluntary membership organization. (Lewis, 2003, p. 26.) Some critics believe that the “MPOs are not likely to support measures that limit the discretion of cities and counties, particularly in those MPOs where every city and county in the region has a seat on the MPO board.” (Higgins, 2008, p. 9.) “Without independent authority, regional agencies have little wherewithal to overcome fundamental conflicts between local and statewide interests.” (Lewis, 2003, p. 26.) One of the three main goals of SB 375 is to encourage infill, high-density residential development. (Higgins, 2008, p. 2.) However, local governments have historically shied away from such development. “One of the main reasons that higher density, infill development has not taken hold throughout the state, despite strong support among professional planners, is that residents frequently organize to oppose such development.” (Greenway, 2010, p 442.) Property owners in the 65 vicinity of proposed high density development frequently organize to defeat such development. “[I]t is easier to mobilize constituencies against housing because concerned neighbors live close to one another, can identify the source of potential impacts, and are likely to experience those impacts directly.” (Greenway, 2010, p. 442.) “The kinds of local land-use decisions required for SB 375 to be successful are precisely the ones for which it has been most difficult to build public support.” (Greenway, 2010, p. 444.) Local elected officials are unlikely to vote for development when current residents oppose the project, because to do otherwise would likely be political suicide. Although there might be consumer demand for higher density projects, local elected officials seek to be responsible to their constituents who already live in their communities. In a critical review of SB 375, Long argued a one-size-fits-all approach to compact development would not work in California because “the ‘Manhattan approach’ is inconsistent with the future westerners imagine for their place, and they will not adopt something that does not achieve their desired vision of their future.” (Long, 2009, p. 765.) The author claims that “substantial institutional and cultural inertia exists resisting any move toward more compact development patterns that could reduce vehicle miles traveled and allow for more efficient uses of scarce, or CO2-producing, energy sources.” (Long, 2009, p. 797.) These views are supported by a long-standing doctrine in property law – the “tragedy of the commons.” As applied to SB 375, local governments appear to 66 have no rational incentive to reduce GHG emissions for global benefit through local resource allocation. “Climate change is widely considered an excellent example of the overexploitation of a commons resource similar to that popularized by Garret [sic] Hardin’s parable of the tragedy of the commons.” (Engel, 2006, p. 1022.) According to Kirsten Engel, “[t]he extremely small dent in global greenhouse gas emissions accomplished by state and local governments only seems to underscore the seeming economic irrationality of the state and local government’s actions.” (Engel, 2006, p. 1028.) Further, Jonathan Wiener explains: “[B]ecause GHGs mix globally and have global impacts, local abatement actions pose local costs, yet deliver essentially no local climate benefits. This in turn suggests that local actions will often be difficult to enact.” (Wiener, 2007, p. 1965.) The doctrine of “tragedy of the commons,” which has historically been applied to various natural resources, lends support to critics’ views that the MPOs will have difficulty persuading local governments (cities and counties) to focus on infill and high-density development as suggested by SB 375. Various local governments’ statements in the wake of the CARB’s release of the GHG emissions reduction targets further support these views. Waterford Mayor Charlie Goeken called the CARB’s targets “arbitrary and detrimental” to the small community’s budget. (Long, 2010.) Tustin Mayor Jerry Amante (also Chair of the Orange County Transportation Authority) called the targets unsustainable – “[t]here is no science behind them; they are driven by climate control zealots.” 67 (Long, 2010.) Further, Kern County responded to the CARB’s “Central Valleywide” targets, stating it was concerned that a single target for eight counties did not take into account the individual differences of each county, and that the reduction targets were too ambitious. (Kern Council of Governments, Sept. 2010.) Kern County said the targets were “arbitrary, unfair and could have serious repercussions to state environmental, economic and equity goals.” (Kern Council of Governments, Sept. 2010.) These comments support literature doubting local governments’ commitment to the SB 375 goals. “Prominent legal scholars and economists have argued that the most efficient way to reduce greenhouse gas emissions to targeted levels would be to constrain greenhouse gas emissions from the top down through a ‘comprehensive’ cap-and-trade regime.” (Trisolini, 2010, p. 683.) Such an approach would mandate local government compliance with the program; however, it would face strong political opposition. IV. Conclusion The structure of SB 375 and the Housing Element Law are almost identical in terms of incentives and lack of enforcement mechanism. In fact, recently, CARB’s Planning Liaison Terry Roberts said, “The statute doesn’t require cities and counties to do anything. The point is not to set regulatory standards that have to be met, but to get regions thinking about how to build sustainable communities.” (Long, 2010.) However, SB 375 does add some teeth to the Housing Element Law 68 in the way of precluding a non-compliant local government from disapproving a general plan compliant affordable housing project. Although this change seems significant, it only applies to “affordable housing projects” and it does not change the general nature and structure of the Housing Element Law. Whether this “stick” will be significant enough to incentivize local governments into compliance remains to be seen. Further, the election of Jerry Brown as the next California Governor may also impact local governments’ compliance with SB 375 and the Housing Element Law. The political structure of each MPO, made up of locally elected officials, creates another barrier to the successful implementation of SB 375. Many local officials have already expressed discontent with the CARB’s targets and resent state intrusion upon the traditional local powers over land development. Due to the CARB’s continued lack of preemptive authority over local land use decisions, it must rely “on local governments’ political inclinations to voluntarily adopt statewide air quality priorities.” (Stern, 2008, p. 621.) Although some local governments will likely be eager to further GHG emissions reductions, others will not. Without the local governments’ participation to promote infill and highdensity products, SB 375 will likely be unable to meet its goals. I agree with various scholars that the political climate in California may require traditional regulations to require local governments to comply with SB 375, through the use of mandates, fines, penalties, etc. However, given the political 69 tension between the state and local governments over revenues and power, the state should focus on establishing cooperation with local governments prior to implementing any mandates. Additionally, the state should ensure that the data and methodology used to establish mandates are consistent across the state and are scientifically defendable. The CARB acknowledged that its findings are based on the various MPOs’ travel models, which differ significantly from one to the other. Therefore, the CARB can’t reasonably expect local governments to take the various targets seriously. Without a consistent methodology, a 5% reduction target in one region may be completely different from a 5% reduction in another region. If the State were to mandate compliance with SB 375, it will need to gain the local governments’ confidence in the determination of the GHG reduction targets and the subsequent compliance monitoring. 70 Chapter 4 CASE STUDY: SAN JOAQUIN VALLEY I. Introduction The San Joaquin Valley presently represents approximately 10% of California’s population, and is expected to grow to 14% of the state’s population by 2035. As defined here, the San Joaquin Valley covers approximately 27,000 square miles and comprises of eight counties: San Joaquin, Stanislaus, Merced, Madera, Fresno, Tulare, Kings and Kern and 62 cities. The northern San Joaquin Valley is defined as the counties of San Joaquin, Stanislaus and Merced. These counties are geographically connected to the San Francisco Bay Area and are thus subject to direct spillovers in population and commuting. The southern San Joaquin Valley is comprised of Madera, Fresno, Tulare, Kings and Kern Counties. In contrast to the northern San Joaquin Valley, these counties are more rural and the cities more freestanding. The southern San Joaquin Valley counties may begin to feel more pressure from the Los Angeles Area in the near future. “Each county has its own Council of Governments, which engages in transportation planning and also allocates the state’s ‘target’ for housing production within each county under the Housing Element Law.” (Teitz and Dietzel, 2005, p. 4.) Generally, each “city and county makes its own plans for future growth and implements those plans – usually with little concern for the cumulative regional 71 effect of their actions.” (Teitz and Dietzel, 2005, p. 5.) Each San Joaquin Valley county has its own MPO, as shown in Figure 2. Figure 1: San Joaquin Valley Source: Earth Techling The reason this thesis focuses on the San Joaquin Valley for the case study is simple: SB 375 seeks to influence land use patterns to reduce VMT and the San Joaquin Valley is projected to have the greatest population growth by 2050, as shown in Table 8. Therefore, the San Joaquin Valley will be instrumental in determining the overall success of the implementation of SB 375. 72 Figure 2: San Joaquin Valley MPOs Table 8: Current and Projected Regional Population Growth in California Annual Population Growth (%) Population Region South Coast 2008 2050 1991-2008 2008-2050 17,500,000 22,787,876 1.2 0.7 San Francisco Bay Area 7,301,080 10,294,746 1.2 1.0 Inland Empire 4,144,088 8,393,115 3.2 2.4 San Joaquin Valley 3,956,003 9,455,181 2.4 3.3 Sacramento Metropolitan Area 2,304,411 4,054,045 2.4 1.8 Central Coast 1,450,844 2,024,438 1.1 0.9 1,430,074 2,498,474 1.3 1.8 38,086,500 59,509,925 1.5 1.3 Rest of State California Source: Authors’ tabulation of California Department of Finance Data: 2007a, 2007b, 2008 73 II. CARB’s Targets for the San Joaquin Valley In CARB’s report, it stated: “the eight MPOs in the San Joaquin Valley have special challenges in terms of resources and technical capability, and they are exploring the potential for collaboration on the multi-regional planning process.” (CARB, 2010, p. 2.) In contrast to the firm targets set for the remaining MPOs, CARB set “placeholder targets” for each of the eight San Joaquin Valley MPOs at a 5% per capita reduction by 2020 and a 10% per capita reduction by 2035. CARB will revisit these targets in 2012 based on the proposed valley-wide blueprint planning process, updated modeling techniques and capabilities, and in preparation of the Valley’s RTPs, which are due in 2014. In setting these targets, CARB considered the target recommendations provided by the various MPOs. Three of the eight San Joaquin Valley MPOs recommended targets prior to CARB’s report and four of the MPOs provided target-setting scenarios. These MPO submittals spanned “a range in per capita greenhouse gas emissions from a seven percent reduction to a twelve percent increase.” (CARB, 2010, p. 5.) In fact, for the 2020 GHG reduction targets, the Fresno County of Governments suggested a 5% reduction from 2005, the San Joaquin County of Governments suggested a 6% reduction from 2005, and the Kern Council of Governments suggested a 9% increase from 2005. (CARB, 2010, Appendix, Excerpts from MPO Submittal of Target Setting Scenarios and Results for the San Joaquin Council of Governments, p. 10.) This divergent range in per 74 capita GHG suggested targets illustrate the concern of treating the eight San Joaquin Valley MPOs alike for purposes of GHG reduction targets. III. Individual San Joaquin County Concerns Several San Joaquin counties have raised concerns with regard to how the proposed valley-wide target could disproportionately affect their individual counties. These counties’ express concerns lend credence to the fear that SB 375 will be unsuccessful in wooing local governments to implement the initiatives and strategies outlined in the Bill. Specifically, Kern Council of Governments has argued that the county’s “strategic employment resources,” such as military bases, wind farms and prisons, make it unlikely that the county could meet the proposed target in future. (CARB, 2010, p. 5.) Indeed, after reviewing its scenarios analysis, Kern found little benefit in GHG reductions through the implementation of SB 375 measures. (CARB, 2010, Appendix, Excerpts from MPO Submittal of Target Setting Scenarios and Results for the Kern Council of Governments, p. 10.) In its target-setting scenarios letter, Kern explained how the unique features of the county would prevent conventional infill “as envisioned by the writers of SB 375.” (CARB, 2010, Appendix, Excerpts from MPO Submittal of Target Setting Scenarios and Results for the Kern Council of Governments, p. 8.) Not only does two-thirds of the households in Kern reside in less than 10% of the area near the County center, but also the largest employment growth sectors in the county include military, wind 75 energy and prisons, which are not conducive to infill locations. (CARB, 2010, Appendix, Excerpts from MPO Submittal of Target Setting Scenarios and Results for the Kern Council of Governments, p. 8.) Similarly, Madera County expressed concern regarding the implementation of SB 375 in the current economic climate. Specifically, Madera County explained that “[r]eductions in local sales tax revenue and subsequent fiscal emergencies that have gripped local governments raise serious questions about the feasibility of implementing SB 375 in a depressed economy.” (Madera County Transportation Commission Letter to CARB, June 23, 2010.) Accordingly, Madera County requested a “delay in SB 375 implementation” to provide “relief for governments struggling to remain afloat and give local planners additional time to prepare for the drastic changes in development patterns that will accompany implementation.” (Madera County Transportation Commission Letter to CARB, June 23, 2010.) Based on the foregoing examples of the voiced concerns, one may deduce that various individual counties do not support the CARB’s GHG reduction targets. Indeed, if these counties express their concerns at the forefront, there is little reason to believe that the counties intend to implement any of the goals or initiatives under SB 375 in the future. However, these counties do have valid points with regard to the individualized differences between the San Joaquin counties. Such differences include population growth, employment patterns, interregional travel patterns, constituents’ views and more. Therefore, these counties’ concerns are valid as to 76 how the same CARB target for the San Joaquin Valley counties makes little practical sense in light of the existing differences between the counties. IV. Development Trends The San Joaquin Valley counties have experienced significant population growth in recent years. However, the growth has not been uniform among the counties, as shown below. Table 9: Population Growth in the San Joaquin Valley Year Fresno 2009 948,928 2008 936,106 2007 Kern Kings Madera Merced 834,041 154,681 152,924 257,373 692,202 527,044 445,251 822,874 154,486 151,648 254,944 686,161 523,966 437,886 919,864 808,364 152,760 149,085 252,052 679,038 520,506 429,202 2006 905,117 789,618 149,766 145,734 248,089 669,881 514,911 421,580 2005 888,873 765,750 146,690 141,929 243,043 660,057 508,281 413,609 2004 873,175 742,025 144,193 138,668 236,637 644,633 498,103 403,780 2003 856,109 719,774 140,037 134,018 230,572 626,082 489,301 393,470 2002 836,487 698,523 135,675 129,435 223,886 607,608 478,506 383,735 2001 819,825 681,076 133,080 127,051 218,034 591,187 466,167 375,801 2000 804,188 664,993 130,086 124,473 211,439 569,073 451,069 369,630 1999 785,015 647,009 125,423 120,304 205,891 549,213 436,128 362,166 1998 777,561 638,244 120,661 118,134 203,172 540,109 429,052 358,668 1997 770,597 630,815 117,058 115,349 200,063 532,567 423,184 355,119 1996 761,142 622,383 116,030 111,663 198,573 525,367 417,486 351,911 1995 748,424 615,560 114,825 108,816 198,740 517,926 413,016 347,539 1994 735,807 606,884 112,623 106,261 196,612 511,051 408,275 341,476 1993 723,413 596,021 110,081 102,305 192,539 505,802 401,589 335,436 1992 705,718 581,030 107,263 97,514 188,278 498,616 392,726 327,996 1991 682,756 559,775 103,838 91,856 182,804 487,944 380,858 318,460 change 38.98% 49.00% 66.48% 40.79% 41.86% 38.38% 39.81% 48.96% San Joaquin Stanislaus Source: Authors’ tabulation of California Department of Finance data Tulare 77 Graph 4: Population Growth in the San Joaquin Valley Indeed, based on the California Department of Finance’s data, Madera County had the greatest percentage increase in population since 1991 at 66.48%. The lowest percentage increase in population was in Stanislaus County at 38.38%, with the remaining counties ranging between these outer limits. The most populous county is Fresno County and the lease populous county is Madera County. These numbers and statistics indicate a significant difference in the level of population and growth applicable to the individual counties. Based on these differences in population and growth, one may infer that the counties also directed and approved different land use patterns based on the individual circumstances in each county. Although the overall picture provides some indication of the population growth experienced in these counties over the past almost 20 years, the growth 78 pattern looks a little different between 2006 and 2009. Indeed, as shown in Table 10, Kern County had the greatest increase in population between 2006 and 2009 at 5.63% with Tulare County following closely behind at 5.61%. Stanislaus showed the lowest population growth at 2.36%. These population growth rates track the building permit issuance in these counties as well. Table 10: Population Growth Between 2006 – 2009 Year Fresno Kern Kings Madera Merced San Joaquin Stanislaus 2009 948,928 834,041 154,681 152,924 257,373 692,202 527,044 445,251 2008 936,106 822,874 154,486 151,648 254,944 686,161 523,966 437,886 2007 919,864 808,364 152,760 149,085 252,052 679,038 520,506 429,202 2006 % Change 905,117 789,618 149,766 145,734 248,089 669,881 514,911 421,580 4.84% 5.63% 3.28% 4.93% 3.74% 3.33% 2.36% 5.61% Tulare Source: Authors’ calculations from California Department of Finance data In fact, the data relating to the issuance of building permits between 2006 and 2009 shows that Kern County granted the greatest number of permits at 11,607. Tulare County also granted a large number of single-family permits at 7,333. Therefore, the building permit issuance seems to track the population growth in the individual counties, or vice versa. Interestingly, Kern, Fresno and Tulare counties also paved the way with multi-family building permits. Indeed, in addition to the 11,607 single-family permits, Kern County approved 3,202 multi-family building permits. Based on the foregoing, Kern County approved 27.91% of all of the building permits in the San 79 Joaquin Valley between 2006 and 2009. This may lend some understanding to Kern County’s vigorous debate against the implementation of the GHG reduction targets, and its projection of a 9% increase in GHG emissions as submitted to CARB. Table 11: Single Family Building Permits 2006 – 2009 Year Fresno Kern Kings Madera Merced San Joaquin Stanislaus Tulare 2009 1,830 1,583 194 68 82 792 275 993 2008 1,540 1,471 236 233 244 765 460 1,275 2007 3,214 3,198 437 486 780 2,201 1,352 2,252 2006 1,284 5,355 661 1,269 1,999 3,461 2,010 2,813 Total 7,868 11,607 1,528 2,056 3,105 7,219 4,097 7,333 Source: California Employment Development Department Table 12: Multi-Family Building Permits 2006-2009 Year Fresno Kern Kings Madera Merced San Joaquin Stanislaus Tulare 2009 139 192 0 52 0 0 85 104 2008 309 901 137 7 105 54 21 212 2007 1,179 882 25 23 14 225 513 435 2006 89 1,227 91 107 80 191 85 760 Total 1,716 3,202 253 189 199 470 704 1,511 Source: California Employment Development Department Further, it is important to note the difference in unemployment rates between the counties. Unemployment is an important indication of economic prosperity and greatly influences development patterns. As shown in Table 13, all of the San Joaquin Valley counties have seen significant rises in unemployment. 80 Merced County has been hit the hardest with an unemployment rate of 21.2% as of January 2011. As the unemployment rates rise, land use development decreases because fewer residents are able to afford new home purchases. In return, as land use development slows down, the strategies set forth in SB 375 become more difficult to implement in order to meet the CARB’s targets. In addition to population growth, an individual county’s land use patterns are also influenced by the availability of development resources when determining where and how much development is sustainable. Although water availability does not directly impact VMT, it does influence development growth patterns. The western part of the San Joaquin Valley has greater water scarcity than the eastern part. Table 13: Unemployment Percentage Data January Fresno Kern Kings Madera Merced San Joaquin Stanislaus Tulare 2011 18.2 16.9 18.3 16.6 21.2 18.5 18.2 18 2010 16.8 15.9 16.5 15.6 18.9 17.3 17.4 16.8 2005 9 8.4 9.5 7.9 10 7.9 8.5 9.5 2005 8.5 8 8.8 7.6 10 7.5 7.8 9.5 2000 10.4 8.2 10 8.7 9.6 7 7.8 10.4 1995 14.1 13.8 14.6 15 17.1 12.3 15.5 16.7 1990 11.7 10.9 11.3 13.5 12.9 9.9 11.9 12.4 Source: California Employment Development Department For example, Kings County is located in the western San Joaquin Valley and has significant water challenges. (Kings County Association of Governments 81 Letter to CARB, May 20, 2010, p. 4.) Therefore, future development and the county’s economic prosperity will be impacted by the availability of water supplies In contrast, Kern County is a high growth area with a secure water supply. (Kern County Association of Governments Letter to CARB, April 23, 2010, p. 9.) Thus, this county may receive a disproportionate increase in future development due to the availability in water supply. These differences between counties and the fact that geographic limitations in one may affect the development patterns in another county support the idea of a state-wide program implementation. V. Interregional Travel Interregional travel presents a great challenge in determining whether individual MPOs will meet their target reduction requirements. Indeed, CARB acknowledged the specific issue of interregional travel. CARB explained, “[r]egions have limited ability to impact interregional travel, which includes travel to and from regions as well as travel that passes entirely through regions.” (CARB, 2010, p. 11.) Although interregional travel is a statewide concern in the implementation of SB 375, it is a significant concern for the San Joaquin Valley where such travel is a large percentage of passenger vehicle travel in the valley. a) Commuting Patterns Data To analyze the individual application of commuting patterns on the San Joaquin Valley counties, I obtained data from the 2000 Census by the U.S. Census Bureau. Although some of the data from the 2010 Census are available, the 82 commuting data has not yet been released. Therefore, this analysis will have some limitations. First, the analysis does not include the increased population and travels between 2000 and 2010. This is a significant limitation, because the San Joaquin Valley has seen great growth over the last 10 years. Second, the analysis does not reflect how changes in geography may have influenced commuting patterns. For example, as certain counties added more retail, airports, universities and other amenities, the commuting patterns may have changed and adapted. In spite of these limitations, the 2000 Census data does provide some insight into the differences in commuting patterns between the San Joaquin Valley counties. The U.S. Census Bureau’s data for the San Joaquin Valley counties is laid out in Table 14. b) Analysis of Commuting Patterns Data The commuting patterns data shows a great disparity in the number of travelers between the eight San Joaquin counties. Indeed, Fresno County has a total of 319,056 commuters compared to Kings County which has a total of 48,860 commuters. Therefore, the VMT by county will vary significantly. Mathematically, counties with a greater number of commuters would have to affect the travel behavior of significantly more people than the counties with fewer travelers in order to meet the same target decrease in GHG emissions. Additionally, when the data is transformed to illustrate the percentage of travel associated with the commuting patterns, as shown in Table 15, it is clear that some 83 of the San Joaquin counties experience a greater percentage of inbound/outbound/through travel than other counties. As Table 15 shows, Madera County has the lowest percentage of in-county commuting at 55.43%. This seems to indicate that Madera County will have greater difficulty in reducing its GHG emissions through SB 375’s suggested land use patterns. In fact, 22.25% of the County’s residents commute to other San Joaquin counties on a daily basis. Thus, in order for Madera County to reduce the impact of these commuters, it must do one of the following: 1) attract businesses to the residences in its County to reduce out of county commutes and shorten trip lengths; 2) coordinate and develop an inter-county transportation system to remove some of the commuter cars from the road; or 3) seek to relocate these commuters to the county in which they work. The latter suggestion is illogical given that a county has no incentive to lose taxpaying residents. The first suggestion does not fit within the ambit of the SB 375 strategies; however, it may provide the County with the greatest incentive because businesses provide an increased tax base. Although the second possible strategy is feasible, Madera County would need to determine where the majority of these commuters work. Further, this alternative would require great capital layout, which may be infeasible in the current state of the economy. In contrast to Madera County, Kern County has the greatest percentage of in-county commuting at 88.58%. Although the data seems to indicate that Kern 84 County would have the greatest control over reducing its in-county GHG emissions relating to commuters, many of these commuters work at military or agricultural operations, which limit the County’s ability to implement GHG emissions reduction strategies as described further below. Table 14: San Joaquin Valley Commuting Patterns Commute Patterns Fresno Within County 273,212 From other SJ Valley counties 22,356 To other SJ Valley counties 17,390 From other states/ counties 2,405 To other states/ counties 3,693 Total Commute 319,056 Kern Kings Madera Merced San Joaquin Stanislaus Tulare 214,958 33,257 28,197 55,021 163,455 134,529 115,300 4,924 6,707 9,370 6,698 14,545 15,911 10,526 3,180 7,495 11,270 12,572 7,194 19,422 13,838 9,120 550 738 1,131 17,153 3,267 596 10,479 851 1,299 5,721 42,476 15,768 1,130 242,661 48,860 50,874 81,143 244,823 188,897 141,390 Source: Authors’ tabulation of data from U.S. Census Bureau (2000 Census) Importantly, the data indicates that San Joaquin County receives 17.35% of the commuters in its County from counties outside the San Joaquin Valley. These commuters generally come from the Bay or Sacramento areas. The significance of this information relates to how SB 375 treats the separate MPOs as independent units. This data illustrates how interconnected the California counties are with respect to VMT. This interconnectedness may create significant challenges for 85 counties to meet CARB’s GHG reduction targets without the coordination and cooperation of all counties that affect commutes to and from the specific county. Indeed, the interrelatedness of commutes between counties provides a basis for the argument that, instead of applying SB 375 on a MPO basis, the focus should be on a statewide initiative, which takes into account the interrelatedness of land use patterns. The strength of this argument is further illustrated by the other differences outlined below. Table 15: San Joaquin Valley Commuting Patterns Percentage Breakdown Commute Patterns Within County From other SJ Valley counties To other SJ Valley counties From other states/ counties To other states/ counties Fresno Madera Merced San Joaquin Stanislaus Kern Kings Tulare 85.63% 88.58% 68.07% 55.43% 67.81% 66.76% 71.22% 81.55% 7.01% 2.03% 13.73% 18.42% 8.25% 5.94% 8.42% 7.44% 5.45% 1.31% 15.34% 22.15% 15.49% 2.94% 10.28% 9.79% 0.75% 3.76% 1.13% 1.45% 1.39% 7.01% 1.73% 0.42% 1.16% 4.32% 1.74% 2.55% 7.05% 17.35% 8.35% 0.80% Source: Authors’ tabulation of data from U.S. Census Bureau (2000 Census) VI. Employment Trends and Existing Land Use Patterns A county or area’s employment distribution may have a great impact on its ability to meet the SB 375 GHG reduction targets. As outlined below, the employment distribution affects the geographic land use patterns, which, in some 86 instances, may make it difficult to reduce VMT. For example, Kings County’s economy is primarily agrarian, consisting of dairy, agriculture and agribusiness, because it “boasts some of the most productive and fertile farmland on earth.” (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 2.) In fact, approximately 18% of the workforce in Kings County is employed in the agricultural sectors. (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 3.) In addition to agriculture, “public facilities such as the Naval Air Station in Lemoore and the State prison facilities at Avenal and Corcoran also serve as major employers for the region.” (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 2.) Further, Kings County has approved and is considering the addition of rural solar facilities within close proximity to Interstate 5. (Kings County Association of Governments Letter to CARB, May 20, 2010, pp. 2-3.) Why is the geographic use within a county important in determining the county’s potential compliance with SB 375 initiatives? The answer is simple – some existing land use patterns are not conducive to infill development or shorter commutes. a) State Prison Facilities and Military Bases The “nature of prison employment is typically not conducive to short commutes.” (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 3.) This is so because “[w]orking as a correctional officer frequently 87 necessitates not residing in the same community as the prison itself,” and such geographic characteristics are not subject to change “because of potential complications for correctional officers to live and work in the same community.” (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 3.) Similar travel patterns are associated with military bases. Indeed, security requirements at military bases and prisons prevent public transit at the facility. Based on the foregoing, San Joaquin Valley counties with significant employment in military or correctional facilities may have greater difficulty in reducing its VMT to achieve the GHG reduction targets. b) Agricultural Employment Farming operations and agriculture processing facilities are generally located outside the urban core, requiring employees to travel long distances away from the urban core. (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 3.) Therefore, increased infill in urban areas would have no impact to reduce the VMT as applied to these economic sectors. Further, suggesting residential development closer to agricultural employment would be infeasible. First, such residential development would seek to convert prime agricultural land, which is contrary to the anti-sprawl goals in SB 375. Further, residential development in such areas would require the addition of other services, such as schools, malls, restaurants, etc.; otherwise, the development would encourage a counter-commute back to the urban core for such services, which 88 would defeat the purpose of moving residences closer to agricultural employment in the first place. c) Solar Energy Facilities Similar to farming operations, solar facilities are generally in rural, isolated areas. The location of these facilities usually depends on the availability of a power grid (which generally runs along an interstate highway) and the location of military bases (which require specific distances for safety reasons). (Kings County Association of Governments Letter to CARB, May 20, 2010, p. 4.) The locations of these facilities generally necessitate travel from urban cores and encourages interregional travel for green collar professionals. Similar to the discussion under agricultural employment, it would be difficult to reduce VMT associated with these existing land use patterns. d) Universities Generally, universities are not suited for location in urban areas. Although universities generally provide some on-campus housing and public transportation to/from campus, most students drive to/from campus. Very few of the San Joaquin Valley counties have universities within its borders. San Joaquin County has the University of the Pacific in Stockton, a private university with a relatively small enrollment of just over 3,000 full-time undergraduates in 2003. Stanislaus County has the only public university, California State University, Stanislaus, which also has modest enrollment numbers. Recently, the new University of California 89 campus in Merced opened its doors, attracting and influencing the migration patterns and interregional travel patterns of high school graduates in the North San Joaquin Valley. Because universities attract students to campus and additional housing on-campus is infeasible, the counties with existing universities will have greater difficulty in decreasing their VMT to meet the GHG reduction targets. e) Employment Distribution On a broader scale, the South and North San Joaquin Valley counties differ dramatically in the distribution of employment, which affects land use patterns. As shown in Table 16, the North San Joaquin has much less agriculture and government employment than the South San Joaquin. Table 16: Percentage Distribution of Employment by Industry, 2002 Employment North San Joaquin South San Joaquin Government 17% 22% Trade, transportation and utilities 20% 16% Educational and health services 11% 9% Professional and business services 8% 8% Agriculture 9% 17% Leisure and hospitality 8% 7% Manufacturing 12% 7% Natural resources, mining and construction 7% 6% Financial activities 4% 4% Other services 3% 3% Information 1% 1% 100% 100% Total Employment Source: Authors’ tabulations of California Employment Development Department data 90 As discussed above, both of these industries generally necessitate greater commute distances and times. Therefore, it would be more difficult for the South San Joaquin counties to achieve the same GHG emission reduction targets as the North San Joaquin counties based on the same initiatives in SB 375, which focuses on land use patterns. VII. Constituents’ Opinions and Views The Public Policy Institute of California has done a lot of research on the Central Valley of California in recent years. Included in these studies were surveys to the residents of the Central Valley to determine their views on the key regional problems facing their geographic areas. The results were divided into four geographic areas: North Valley (Shasta, Tehama, Glenn, Butte, Colusa), Sacramento Metro (Sutter, Yuba, Placer, El Dorado, Yolo and Sacramento), North San Joaquin (San Joaquin, Stanislaus, Merced), South San Joaquin (Madera, Fresno, Kings, Tulare and Kern). Focusing on the San Joaquin Valley, the differences in the perception of the “most important issue” facing the Central Valley are outlined in Table 17 below. Significantly, the North San Joaquin and South San Joaquin counties disagree greatly on the importance of air pollution. Indeed, the South San Joaquin counties’ perception that air quality is the most important issue was more than double that of the North San Joaquin counties, at 32% versus 14%. In contrast, the North San Joaquin counties’ perception that population growth, development and sprawl is the 91 most important issue was triple that of the South San Joaquin counties, at 15% versus 5%. These differences in opinion may have a significant effect on the implementation of SB 375. As explained under the Political Constraints chapter, the views of constituents may greatly impact the local governments’ views on land use development decisions. Table 17: Most Important Issue Facing Central Valley Opinion Poll Issue North San Joaquin South San Joaquin Air pollution, pollution in general 14% 32% Jobs, unemployment, economy 12% 13% Population growth; development; sprawl 15% 5% Water availability and quality 5% 6% Crime, gangs 8% 9% Traffic, transportation 5% 2% Education, schools 3% 3% Housing costs, housing availability 6% 1% Drugs 3% 2% Other 13% 11% Don’t know 16% 16% Source: Baldassare, 2004, p. 5 a) Transportation Projects The willingness of constituents to tax themselves for local transportation projects differs significantly between the North San Joaquin and South San Joaquin counties. For example, 70% of the North San Joaquin poll versus 59% of the South San Joaquin poll said they would vote yes on a ballot measure that would increase local sales tax for local transportation projects by one-half cent. (Baldassare, 2004, 92 p. 9.) As local transportation projects are a significant part of the overall SB 375 initiative, the implementation of such projects may differ dramatically based on the views of the individual counties’ constituents. Further, these views may also significantly impact the cooperation among the various counties to reduce the impact of inter-regional travel (which is a large portion of the travel within the individual counties as described above). The constituents of the North and South San Joaquin counties also have divergent views on the types of surface transportation projects that should have top priority for public funding. The South San Joaquin constituents focus more on local streets and roads and show greater support for a public bus system and highspeed rail. (Baldassare, 2004, p. 9.) In contrast, the North San Joaquin constituents show greater support for freeways and highways and a light rail system. (Baldassare, 2004, p. 9.) b) Air Quality Regulations The Public Policy Institute of California’s study on the Central Valley revealed key differences in opinion with regard to the South and North San Joaquin constituents’ views on which government body should take primary responsibility for setting air quality standards and plan for future growth. In fact, the South San Joaquin counties show greater support for the state and federal governments to take the reigns on air quality standards. (Baldassare, 2004 p. 11.) This coincides with these residents’ opinion that air pollution is a big 93 problem. Quite the opposite, the North San Joaquin counties prefer for regional air resources boards and local governments to take primary responsibility for setting air quality standards. (Baldassare, 2004, p. 11.) Similarly, the North San Joaquin believes that planning for future growth should be left in the hands of city governments rather than county or state governments, in contrast to the South San Joaquin, which favors state and county government responsibility for such policies. (Baldassare, 2004, p. 12.) c) Analysis These differences in opinion on fundamental ideological issues that form the basis of SB 375 illustrates the potential for divergent implementation of the proposed SB 375 goals and strategies. Indeed, the divergent views support the suggestion that a statewide initiative would guide more uniform and collaborative efforts to minimize VMT and GHG. If the implementation of these initiatives are left in the hands of each MPO, who are subject to great political pressure based on the views of their constituents, there should be no expectation of uniform implementation. In fact, some counties may completely disregard these initiatives based on their specific geographic, economic, and political climate. Further, it is interesting to note that in the Central Valley, the San Joaquin Valley cities are more willing to use pro-growth tools, such as annexation and upzoning. (Johnson & Hayes, 2004, p. 92.) These pro-growth views are indeed contrary to the SB 375 initiatives and goals, such that it may impact the individual 94 counties’ willingness to implement the proposed land use strategies. Also, the South San Joaquin Valley region is more likely “to be active in regulating growth through the initiative process, elections and their city councils’ actions.” (Johnson & Hayes, 2004, p. 93.) Thus, these constituents may exert more pressure on their local governments relating to their views and opinions than the North San Joaquin Valley constituents. VIII. Conclusion The differences among the eight San Joaquin Valley counties illustrate the difficulty in assigning the same GHG reduction target to the eight MPOs. Indeed, each of these counties differ based on geography, natural resources, economic viability, interregional travel, existing land development patterns, and constituent views and opinions. Further, the individual concerns raised by some of these counties underscore the political and fiscal pressure to maximize revenue and minimize cost. Given that SB 375 is an incentive Bill rather than a mandatory or regulatory law, it is unlikely that all of the San Joaquin Valley counties will meet the prescribed target. Indeed, based on preliminary objections, some counties may simply refuse to implement any of the SB 375 initiatives. If California seeks to reduce GHG, the most productive manner may be to establish statewide standards and offset the available reductions based on land use, projected population growth, approved land development, statewide transportation, and natural resource allocation for future development. Although a statewide 95 program may face significant political opposition, it may be the most effective method to facilitate collaboration and coordination among the various counties. Indeed, the success of SB 375 seems to depend on such coordination and cooperation. As explained under the prior two chapters, counties face significant political and fiscal barriers. These barriers impact local land use decisions based on local pressures and financial needs. To the extent land use decisions are focused on a larger scale, such local pressures would have a lesser effect on land use decisions. Moreover, a county is more likely to comply with and participate in a statewide mandatory program, than a locally implemented incentive program. If the incentives do not further the county’s own goals and needs, the county has no reason to comply with the Bill’s requirements. This carrot without a stick approach only works to the extent the carrot is desirable. As explained herein, not all counties support or desire the incentives provided under SB 375. As such, I believe the Bill is doomed to irrelevance. Without the proper support framework, necessary incentives and/or mandatory requirements with real and actual consequences, counties have little incentive to place the goals of SB 375 before its own fiscal and political needs. Air is fluid; it travels unobstructed and uninhibited from one region to another. Thus, political decisions made in one county may significantly affect the air quality in neighboring counties. This interconnectedness requires a broader and 96 facilitated process to reduce greenhouse gas emissions. Indeed, this point is illustrated through the broad range in projected targets provided by the various San Joaquin Valley counties to CARB. A statewide coordinated and negotiated development plan will produce the most effective and efficient use of the state’s natural and financial resources. Further, it would minimize the fiscal and political conflicts the individual counties face when deciding on future development and implementation of the SB 375 initiatives. 97 BIBLIOGRAPHY Baer, William C. (2008). California’s Fair-Share Housing, 7 Journal planning History 48. Baldassare, Mark (April 2004). Special Survey of the Central Valley in collaboration with the Great Valley Center. San Francisco, CA: Public Policy Institute of California. Buzbee, William W. (2007). Asymmetrical Regulation: Risk, Preemption, and the Floor/Ceiling Distinction. New York University Law Review, 82, p. 1547. California Air Resources Board (2010). Proposed Regional Greenhouse Gas Emission Reduction Targets for Automobiles and Light Trucks Pursuant to Senate Bill 375. Staff Report: released August 9, 2010, adopted September 23, 2010. California State Association of Counties (October 21, 2008). SB 375 (Steinberg) Addressing Greenhouse Gas Emissions from the Transportation Sector via Regional Transportation Plans. Sacramento, CA: California State Association of Counties. Carlino, G. (1985). Declining city productivity and the growth of rural regions: a test of alternative explanations. Journal of Urban Economics, 18, pp. 11-22. Carlino, G. A. and Mills, E. S. (1987). The determinants of county growth. Journal of Regional Science, 27(1), pp. 39-54. Chapman, Jeffrey I. (Sept. 1998). Proposition 13: Some Unintended Consequences. San Francisco, CA: Public Policy Institute of California. Darakjian, John (Dec. 2009). SB 375: promise, compromise and the new urban landscape. UCLA Journal of Environmental Law & Policy, 27(2), pp. 371-411. Los Angeles, CA: University of California at Los Angeles, School of Law. Detwiler, P.M. (2001). Chapter 1, Introduction: Federal and State Sources of Funding. Exactions and impact fees in California: a comprehensive guide to policy, practice, and the law, pp. 1-13. Point Arena, CA: Solano Press Books. Edwards, David J. (Spring 2005). Fiscalization of Land Use: Local Government Taxes and Urban Sprawl. Sacramento State University, Sacramento (Thesis). 98 Engel, Kristen H. (2006). State and Local Climate Change Initiatives: What is Motivating State and Local Governments to Address a Global Problem and What Does This Say About Federalism and Environmental Law? Urban Lawyer, 38, 1015. Fulton, William (1999). A Guide to California Planning. Solano Press Books. Glaeser, E. and Kahn, M. E. (2001). Decentralized employment and the transformation of the American city. Cambridge, MA: National Bureau of Economic Research. Greenway, Greg (2010). Getting the Green Light for Senate Bill 375: Public Engagement for Climate-Friendly Land Use in California. Pepperdine Dispute Resolution Law Journal, 10, pp. 433-463. Malibu, CA: Pepperdine University School of Law. Hanak, E. and Bedsworth, L. et al. (Nov. 2008). Climate Policy at the Local Level: A Survey of California’s Cities and Counties. San Francisco, CA: Public Policy Institute of California. Higgins, Bill (Sept. 2008). Technical Overview of SB 375 (v 1.1). Sacramento, CA: League of California Cities. Johnson, Hans P. and Hayes, Joseph M. (2004). The Central Valley at a Crossroads: Migration and Its Implications. San Francisco, CA: Public Policy Institute of California. Kern Council of Governments (Sept. 13, 2010.) SB 375 Target Setting: Kern COG Response to 8-9-10 ARB Staff Report – Version 3. Retrieved November 14, 2010 at http://www.arb.ca.gov/cc/sb375/mpo/kcog/kern%20comment%20letter.pdf. Lewis, J., Domage, J. and Wickett, N. (2009). “Branding Kyoto”: The Rhetorical Uses of the Kyoto Protocol by American and Canadian Legislators, 1998-2008. Paper presented at the annual meeting of the Midwest Political Science Association 67th Annual National Conference, The Palmer House Hilton, Chicago, IL. Retrieved on November 23, 2010 from http://www.allacademic.com/meta/p362477_index.html Lewis, P. G. and Barbour, E. (1999). California Cities and the Local Sales Tax. San Francisco, CA: Public Policy Institute of California. 99 Lewis, Paul G. (2001). Retail politics: local sales taxes and the fiscalization of land use. Economic Development Quarterly, 15(1), pp. 21-35. Lewis, Paul G. (2003). California’s Housing Element Law: The Issue of Local Noncompliance. San Francisco, CA: Public Policy Institute of California. Listokin, David (1976). Fair Share Housing Allocation. New Brunswick, NJ: Rutgers University, Center for Urban Policy Research. Long, Jerrold A. (2009). From Warranted to Valuable Belief: Local Government, Climate Change, and Giving Up the Pickup to Save Bangladesh. Natural Resources Journal, 49, pp. 743-800. Long, JT (Sept. 7, 2010). SB 375 Targets on CARB Agenda Despite SCAG Denial of Higher Greenhouse Gas Emission Reduction Goals. PublicCeo.com. Retrieved on November 22, 2010 http://publicceo.com/index.php/local-governments/151-local-governmentspublicceo-exclusive/1984-sb-375-targets-on-carb-agenda-despite-scag-denial-ofhigher-greenhouse-gas-emission-reduction-goals. Malaczynski, Joanna D. and Duane, Timothy P. (2009). Reducing Greenhouse Gas Emissions from Vehicle Miles Traveled: Integrating the California Environmental Quality Act with the California Global Warming Solutions Act. Ecology Law Quarterly, 36, pp. 71-135. San Francisco, CA: The Regents of the University of California. Marsden, Greg and Rye, Tom (2010). The governance of transport and climate change. Journal of Transport Geography, 18(6), pp. 669-678. McKinstry, Robert B., Jr. and Paterson, Thomas D. (2007). The implications of the new “old” federalism in climate-change legislation: how to function in a global marketplace when states take the lead. Pacific McGeorge Global Business and Development Law Journal, 20, pp. 61-110. Sacramento, CA: University of the Pacific, McGeorge School of Law. Olshansky, R.B. (1996). The California Environmental Quality Act and Local Planning. The Journal of the American Planning Association, 62(3), 313-330. Peter, Ellen M. (2010). View from ARB: AB 32 The Update. “AB 32: The Battle Heats Up” presentation on October 24, 2010 at the State Bar of California 100 Environmental Law Section 2010 Environmental Law Conference at Yosemite. Sacramento, CA: California Air Resources Control Board. Public Policy Institute of California (June 2008). Proposition 13: 30 Years Later. San Francisco, CA: Public Policy Institute of California. Regional Targets Advisory Committee (2009). Pursuant to Senate Bill 375: A Report to the California Air Resources Board. Available at http://www.arb.ca.gov/cc/sb375/rtac/report/092909/finalreport.pdf. Rubalcava, Sharon (2010). AB 32 Update: The Regulated Entities’ Perspective. “AB 32: The Battle Heats Up” presentation on October 24, 2010 at the State Bar of California Environmental Law Section 2010 Environmental Law Conference at Yosemite. Los Angeles, CA: Alston and Bird, LLP. Schoradt, Brent (2009). Sustainable Communities Strategies Will Be Essential to the Success of SB 375. Ecology Law Quarterly, 36, pp. 611-614. Oakland, CA: The Regents of the University of California. Shanske, Darien (Spring 2010). Above All Else Stop Digging: Local Government Law as a (Partial) Cause of (and Solution to) the Current Housing Crisis. University of Michigan Journal of Law Reform, 43, pp. 663-712. Ann Arbor, MI: The Regents of the University of Michigan. Sheffrin, S. M. and Sexton, T. (1998). Proposition 13 in Recession and Recovery. San Francisco, CA: Public Policy Institute of California. Shires, Michael A. (1999). Patterns in California Government Revenues Since Proposition 13. San Francisco, CA: Public Policy Institute of California. Shires, Michael A. and Ellwood, John et al. (1998). Has Proposition 13 Delivered? The Changing Tax Burden in California. San Francisco, CA: Public Policy Institute of California. Shires, Michael A. and Habers, Melissa Glenn (Feb. 1997). A Review of Local Government Revenue Data in California. San Francisco, CA: Public Policy Institute of California. Stern, Henry (2008). A Necessary Collision: Climate Change, Land Use and the Limits of A.B. 32. Ecology Law Quarterly, 35, pp. 611-637. Oakland, CA: The Regents of the University of California. 101 Stern, N. et al. (2006). Stern Review: The Economics of Climate Change. London, UK: HM Treasury. Tars, Eric S. and Egleson, Caitlin (Winter 2009). Great Scot!: The Scottish Plan to End Homelessness and Lessons for the Housing Rights Movement in the United States. Georgetown Journal on Poverty Law and Policy, 16, pp. 187-216. Teitz, Michael B. and Dietzel, Charles, et. al. (2005). Urban Development Futures In The San Joaquin Valley. San Francisco, CA: Public Policy Institute of California. Trisolini, Katherine A. (2010). All Hands on Deck: Local Governments and the Potential for Bidirectional Climate Change Regulation. Stanford Law Review, 62, pp. 669-746. United Nations Framework Convention on Climate Change. Status of Ratification of the Kyoto Protocol. Retrieved on November 23, 2010 from http://unfccc.int/kyoto_protocol/status_of_ratification/items/2613.php Urban Land Institute (June 2010.) SB 375: Impact Analysis Report. Washington, DC: Urban Land Institute. Wassmer, Robert W. (2002). Fiscalization of land use, urban growth boundaries, and non-central retail sprawl in the western United States. Urban Studies, 39(8), pp. 1307-1327. Whitman, Darrell Lynn (Spring 2003). Climate Change and Global Environmental Governance: Science, Politics and the Kyoto Protocol. Sacramento State University, Sacramento (Thesis). Wiener, Jonathan B. (2007). Think Globally, Act Globally: The Limits of Local Climate Change Policies. University of Pennsylvania Law Review, 155, pp. 19611979.