Santa Rosa's Caritas Homes: Addressing the Housing Crisis Amid Fairness Concerns.

 Mural by Christopher Statton and Megan Wilson, 2015

© Ponderosa Templeton 2017

CC BY-SA 4.0

via Wikimedia Commons.

Sarah Edwards of the Press Democrat writes today about new housing in Santa Rosa. Tenants will soon be selected to fill 33 affordable apartments in downtown Santa Rosa, as part of Burbank Housing's two-phase Caritas Homes development. The project aims to provide 126 units in total to address the housing shortage in North Bay. The first building of the Caritas Homes development is set to be completed by July 1, with half of the first phase's residents being chosen through an April 21 lottery and the remaining units allocated for those experiencing homelessness. The development will be located at 340 and 360 Seventh St., catering to households earning between 40% and 60% of the area median income or those with a Sonoma County Housing Choice Voucher or Section 8 voucher.

Caritas Homes will consist of two identical buildings, each with 63 units, offering studio, one-bedroom, and two-bedroom apartments. The first 30 units in each building will be reserved for people experiencing homelessness. The development will also feature a secured parking garage, indoor community room, outdoor gathering space, and indoor bicycle storage. The first building cost $44 million to build, while the second will require $47 million due to inflation and rising construction costs.

Sonoma County behavioral health services and Catholic Charities will be available to support tenants who were previously homeless. The project, which provides around 90 units per acre, is different from the existing construction in downtown Santa Rosa. The development was initiated in response to the chronic housing shortage, which was further exacerbated by the 2017 Tubbs Fire, destroying 5,000 housing units in Sonoma County.

Two items struck me about this article. Firstly, the development doesn't look like 90 units per acre at all; instead, it looks attractive and friendly, with a mix of two, three, and four-storey elevations. The architects should be commended for that. Secondly, a more challenging and emotional point is that housing allocation is being determined here by a lottery system. Deciding where someone lives is a very high-stakes matter to decide on chance. The article mentions that around 10,000 people are on waiting lists for housing in the county, and nearly 3,000 are homeless. In a society that emphasizes distributive justice, resources should be allocated unequally only to the extent that it benefits the least advantaged members of the community. Instead of a lottery system, a  better way would involve assessing needs and prioritizing those in the most vulnerable situations. Only then will our shared sense of fairness be addressed, one of the crucial requirements of any effort to address our housing crisis.

Red States, Blue Cities, Dynamic America.

     

     

"President Barack Obama and Cabinet."

White House East Room, September 10, 2009.

Public Domain.

via Wikimedia Commons.

In today's New York Times, David Brooks discusses the trend of people migrating from blue states to red states in the US. Between 2010 and 2020, the fastest-growing states were mostly red, such as Texas, Georgia, Florida, Tennessee, and South Carolina. This growth is attributed to lower taxes, fewer restrictions on home construction, lower housing prices, and more pro-business policies. However, the growth in red states is concentrated in metro areas, often blue cities in red states. The dynamic success stories are a result of a red-blue policy mix where Republicans provide a business-friendly climate and Democrats influence education, social services, and civic atmosphere. The column argues that no political party is currently embracing this policy blend, which has proven effective in creating a dynamic and cosmopolitan society. The author suggests that the Democratic Party's growing strength in Southwestern states could potentially give rise to a new kind of Democrat that promotes this policy mix.

David Brook's career began as a police reporter in Chicago, and he recognizes the significant impact it had on his perspectives. His experiences on the crime beat shifted his views from a more liberal standpoint to a more conservative one. Brooks seems to be highly conscious of the concept of black-and-white morality, which leads him to seek a balanced approach where both sides of an argument have valid points. In essence, Brooks proposes that a third option, which incorporates ideas from both sides, is often attainable.

Here, I think Brooks misses some of the essential characteristics of how cabinet-style dynamics function, which I generally accept as a starting point for analysis of most government decisionmaking. In "The English Constitution," Walter Bagehot highlights the significance of blending old and new minds in the British parliamentary cabinet system for effective governance, emphasizing the importance of secrecy and trust in maintaining unity and functionality. By combining experienced ministers' continuity and institutional knowledge with new ministers' fresh ideas and energy, the cabinet can adapt to changing circumstances and address contemporary issues. Secrecy ensures confidential cabinet discussions and disagreements, fostering open dialogue and consensus-based decisions. Trust among cabinet members is essential for upholding collective responsibility and loyalty, even when personal disagreements occur. Ultimately, Bagehot argues that the balance of experience and innovation, combined with secrecy and trust, contributes to the effective functioning of the government.

Bagehot argues that the most dangerous person to a cabinet government is the disloyal insider. A disloyal insider can undermine the collective responsibility principle, where all ministers must publicly support cabinet decisions, even if they personally disagreed during internal discussions. By breaking this trust and revealing confidential information or dissenting opinions, the disloyal insider can weaken the solidarity and unity of the cabinet, disrupt its decision-making process, and potentially harm the government's credibility and stability. Thus, Bagehot emphasizes that disloyal insiders pose a significant threat to the cabinet government's effectiveness and overall political structure.

Bagehot's central argument highlights the importance of consensus in a government composed of both cautious old minds and and fresh energetic ones. Brooks fails to consider that a political party's drive to act stems from their shared values and the aspiration to advance them. Brooks appears to suggest that experienced and fresh minds together would embrace a logical compromise on the very shared values that unite them. However, it is more probable that both groups would view this approach as flawed and dismiss those promoting it.

Brooks doesn't offer realistic solutions for a feasible third way, and his argument appears at odds with the realities of media influence and political communication. Rather than individuals blending positions, a stronger argument would recognize that blue cities in red states play a vital role in holding their governments accountable, encouraging debate, and preventing complacency in the ruling red-state governments. By remaining committed to the nation and their democratic values, these blue cities enhance the political system's stability and effectiveness while pushing the red-state governments to improve and refine their policies. Ultimately a stronger America emerges from that dynamism, as has been noted in the Economist recently. 

A Salty Solution to Lithium Woes?

     

"Containerized Vanadium Flow Battery"

UniEnergy Technologies

CC BY-SA 4.0

via Wikimedia Commons.

The New York Times' Keith Bradsher writes today about the development in China of batteries that use sodium instead of lithium, a far cheaper and more abundant material. Sodium batteries have the advantage of keeping almost all of their charge when temperatures fall far below freezing, which is an issue for lithium batteries. Recent breakthroughs mean that sodium batteries can now be recharged daily for years, which has been a key advantage of lithium batteries.

Sodium batteries are being developed at Central South University in Changsha. Chinese companies are leading the way in commercializing the technology, and they have figured out in the past year how to make sodium battery cells so similar to lithium ones that they can be made with the same equipment.

A significant challenge, however, is where to get the sodium. While salt is abundant, the United States accounts for over 90 percent of the world’s readily mined reserves for soda ash, the main industrial source of sodium (Chinese ventures generally use expensive synthetic soda ash). Another question hanging over sodium is whether lithium will remain costly. Lithium prices quadrupled from 2017 to last November, but have since dropped by two-thirds.

As Bradsher notes, utility companies could benefit from using sodium batteries, but they face unique challenges due to the regulated nature of their operations. These companies have to plan well in advance because they need regulatory approval to recover costs and adjust prices. Furthermore, utility assets like power plants and transmission lines can last for decades. Many of the facts that need to be ascertainable for utilities to implement sodium batteries are still question marks, as there's no prior history or long-term operational record.

Batteries are an increasingly important technology and the investment is definitely news. It's a tough area for a reporter to work in because a pair of the subjects (Technology, China) have familiar tropes that can get in the way. The national security implications of battery technology, though, do appear to be ones that the United States is taking seriously, as NPR's All Things Considered reported in August of 2022 in the case of vanadium redox flow batteries. Batteries are a component of green energy, and expecting foreign direct product rules to come into effect concerning the same may be a mere matter of time.

The Nature of the Firm and the limits of Economics.

     

Ronald Coase

University of Chicago Law School

via Wikimedia Commons

https://tinyurl.com/26ffzfkp

This week's Economist includes an article by their Free Exchange columnist, regarding the "The Nature of the Firm," Ronald Coase's classic 1937 work. Despite the belief in the 1990s that economics could command a unified science of business, three decades later, it has not progressed in understanding the inner workings of firms. Neoclassical economic theory primarily focuses on markets and the allocation of scarce resources, but it does not account for the fact that much of the allocation of resources in economies occurs within firms, where employees are directed by administrative fiat rather than price signals. The theory that firms are profit-maximizers is also challenged by the reality of "bounded rationality," as no business could process all the information needed to extract maximum profit.

Economists have made strides in understanding firms through concepts such as team production, incomplete contracts, and the principal-agent problem. However, these theories still fall short of providing practical advice on corporate strategy. Economics often fails to capture the importance of corporate culture, shared values, and pride in the workplace, which are essential to a flourishing business. Moreover, economics is limited in its ability to address the specificity of business problems, as they require detailed knowledge of various fields outside the discipline. While economic ideas can offer some insights, the study of business remains an outpost that economics is unlikely to conquer fully.

It was beyond the scope of the article, but a government agency (or, as a shorthand, an "agency") can also be viewed as a firm responsible for providing public goods or services and implementing policies. Like traditional firms, government agencies coordinate resources and make decisions under the principle of "bounded rationality." The major difference is that these agencies differ in their objectives, as they aim to maximize social welfare and address market failures, rather than seeking profit maximization, but which I would note, makes the insights of the Free Exchange column even more trenchant. Further, because government agencies also face unique challenges in terms of bureaucracy, political influences, and accountability, their efficiency and decision-making processes are even less susceptible to an economics-based analysis. 

While apocryphally attributed to Twain, William S. Burroughs' advice to "write about what you know" leads me to look at my home in light of this. I note, over and over, that the critical issues my community encounters are almost always decided in an interchange and an interplay between firms and agencies. If anything, economics is something of a base meridian used to calibrate during the continuing conversations with multiple actors that are directed by fiat using bounded rationality to either pursue profit or improve social welfare, a problem only marginally susceptible to economics-based analysis. 

Almost all of the important questions instead require detailed knowledge of various fields outside of economics. Indeed, to the extent that economics is used after the point-of-reference stage, it is of limited utility by itself. The dozen other factors noted above, including but not limited to corporate culture, shared values, pride in a workplace, bounded rationality, team production, incomplete contracts, the principal-agent problem, political influence, bureaucracy, accountability, market failure, and social welfare, are generally the factors to address in any analysis of the (for lack of a better phrase) political economy of most local decision-making that I have encountered -- a nice checklist for future reference. 

Carriage Court in Santa Rosa.

"A mobile home park in West Miami, Florida"

By Dr Zak 

https://tinyurl.com/22c4uctp

In Wikipedia, CC BY-SA 3.0

https://tinyurl.com/2y9chhga 

Carriage Court, a mobile home park for seniors in Santa Rosa, it is reported today by the Press Democrat's Marisa Endicott, is being converted to an all-ages park by new management company Harmony Communities. The company claims that the change is necessary for the park to stay afloat and make a profit. However, residents are concerned about potential displacement and culture shift, as many of them rely on fixed incomes and have limited options if costs increase. The change comes in response to Santa Rosa's new mobile home rent control ordinance, which limits how much park owners can raise rent, according to Nick Ubaldi, regional manager for Harmony Communities. 

Residents are also worried about Harmony Communities' track record of litigation over evictions and rent increases. The company is involved in multiple lawsuits across the state and has a reputation for strict rule enforcement and eviction attempts. The Golden State Manufactured-home Owners League has noted that Harmony's "reputation is terrible." The director of communications for Harmony Communities identifies as a crude epithet, Heywood Jablóm, a false name and a classic sign of a bad actor. Indeed, Mariah Thompson, a staff attorney with California Rural Legal Assistance, noted that Harmony Communities will "often just see what they can get away with[.]” 

Mobile home parks, especially in American culture, are stereotypically viewed as lower-income housing for occupants living at or below the poverty line who have low social status. As Wikipedia notes, despite the advances in trailer home technology, the image survives. Residents, especially the elderly, can be targets for unscrupulous business practices. 

Here, Ubaldi is contending that an updated rent control ordinance, designed to protect senior citizens, is in fact the source of senior citizens' distress. This is an obvious attempt to reverse victim and offender, which is harmful to the democratic process, beyond the specific harm it inflicts on the residents of Carriage Court. Sowing confusion and undermining accountability only weakens the norms we all rely upon to effectively address our housing crisis, which is bad and getting worse. Ideas, like housing, are more of a public good, like a forest, than a commercial context, like a marketplace.  We all must recognize that public discourse is vulnerable to the same damage that can be suffered by the woods should the balance between individual advantage and long-term sustainability be violated callously.

Attendance, Housing, and Basic Aid.

 Sonoma County's 40 public school districts continue to see attendance declines. The lack of housing and a steadily declining birth rate are among the factors contributing to the decline. Sonoma County is predicted to experience a 16.9% enrollment drop by 2031, the fourth worst in California, as reported by the Press Democrat. In the past five years, Sonoma Valley has already experienced an 18.9% decrease in attendance, and as a trustee, I am familiar with the very profound changes that can cause. 

The article elides past some distinctions that are worth noting. First, school funding in California is based on attendance (the so-called "ADA," or average daily attendance), not enrollment (ADA is usually about 90% of enrollment, although there is a lot of variation).  Paying attention to the attendance figure will be the more reliable indicator of the state of school finance going forward in Sonoma County. 

Second, and related to the first point, is that as of November 2022, 16 of the 40 school districts in Sonoma County were "basic aid" districts, whose revenues do not change with either attendance or enrollment. In 2021‑22, the state had 118 basic aid school districts (about 13 percent of all districts).  As attendance continues to drop, more and more Sonoma County districts will become basic aid. Basic aid will increasingly be the default rule in Sonoma County. These districts (like Sonoma Valley) will ironically end up with more money per student given declining attendance, which is why many of these districts may very well not be interested in district consolidation intended to cut costs, as such consolidation would in fact reduce per-student funding.  There are a number of these districts in San Mateo, Santa Clara, and Marin counties, those counties having had many of the same housing issues as Sonoma County for a longer period of time, and the trend in those counties has generally been against consolidation of districts.   

A final point, which comes up here from time to time. "Affordable Housing" is a term of art in many respects, and while there is a shortage of housing that can be afforded in Sonoma County by most people, that is different from "Affordable Housing." Sonoma County just lacks housing, period. Narrowing the issue using the term of art is probably not the most helpful, because it obscures the fact that the response to the crisis needs to be comprehensive.

Green Checkmate.

Today Fred Allebach, a member of the Sonoma Valley Collaborative and a friend, shared his thoughts on affordable housing and the challenges faced in Sonoma Valley and beyond with me via email. He provides a historical context of the 2020 Sonoma Urban Growth Boundary (UGB) issue, and how it continues to impact affordable housing projects. Allebach identifies the "Green Checkmate," a dynamic that hinders progress in the development of affordable housing by preserving low-density zoning and maintaining property value advantages for existing homeowners.

Fred also discusses the tension between environmental justice and social justice, pointing out that environmentalists (and those aligned with) tend to use green arguments to justify preserving a low-density, high-property-value status quo. He explains how affordable housing development is caught in a series of impossible arguments, resulting in the de facto segregated status quo.

Allebach advocates for a more inclusive approach to housing development that balances sustainability and social equity. He suggests supporting lower-income housing projects in unincorporated urban service areas and strategic affordable housing projects in non-urban service areas, especially where there are substantial job opportunities nearby. He also recommends considering the establishment of a City of Sonoma Valley to better address the collective housing needs of the region's population.

I have long appreciated Fred's work and his keen attention to and expertise regarding housing. Over time, Fred, and a group of like-minded, pragmatic reformers, with their continued focus on this difficult problem, are building the necessary muscles in the community to allow change to occur in the face of what can only be described as obstructive hostility. Fred's work shows how, rather than inspiration or enlightenment, it is grit that is the essential element in pursuit of justice.