Unions' fight against affordable housing

By MICHAEL SALTSMAN

June 5, 2016 

Gov. Jerry Brown recently proposed reforming the state’s California Environmental Quality Act by allowing new housing projects with at least 20 percent on-site affordable housing to bypass the law’s cumbersome environmental impact process and be approved “as of right.”

In short, projects meeting the affordable housing threshold would be approved without review by local government entities and without being subject to citizen appeal.

One would think that California’s labor unions would be quick to hail Gov. Brown’s reform. After all, construction means employment for many unions, and labor advocates used unaffordable housing prices as an argument for raising the minimum wage in cities like San Francisco.

As is often the case, however, some unions chose political self-interest over the general welfare of their members and came out against Gov. Brown’s reform.

This was not likely a surprise to the governor. When UCLA’s Blueprint magazine asked him in an interview this spring why labor unions opposed CEQA reforms, he was blunt: “The unions won’t let you because they use it as a hammer to get project labor agreements.”

CEQA requires all development projects to complete environmental impact reports (intended to explore the development’s effect on local plants and animals) prior to final project approval by city hall. A clean report, however, can be challenged in a lawsuit by anyone concerned, which immediately halts development. Labor unions and other advocacy organizations discovered that they could use frivolous CEQA challenges to “greenmail” businesses and further their own policy agendas.

A recent report by the law firm Holland & Knight sheds light on the abuse of this law: They found that 80 percent of CEQA complaints in a three-year period (2010-12) targeted “infill” projects on current developments that posed minimal environmental risk; only 20 percent of the litigation targeted projects that developed on new land.

Los Angeles has had a front-row seat to CEQA shenanigans.

In late 2015, the hammer of CEQA, wielded by the International Brotherhood of Electrical Workers, fell hard on Japanese light-rail manufacturer Kinkisharyo International. Kinkisharyo was awarded $900 million in contracts in May 2012 to build trains for Los Angeles County after the company promised to build the train cars within the county and employ more people. After completing a lengthy environmental impact study for Palmdale’s City Council, the company received a CEQA environmental challenge from the IBEW union and local allies, forcing Kinkisharyo to find an alternate site.

The company was then hit with a second challenge from the IBEW, targeting its new site, leading the company to announce plans last year to build its manufacturing plants outside of California. Los Angeles Mayor Eric Garcetti stepped in to help negotiate a deal between the IBEW and Kinkisharyo, leading to an agreement in November that settled the CEQA challenge.

The final agreement, curiously, included no change to Kinkisharyo’s environmental practices. What was included, however, was a “neutrality agreement” which allows the IBEW to organize the company’s employees.

As far as CEQA was concerned, Mayor Garcetti’s press release stated, “Labor and community groups settled a public records act lawsuit and agreed that all environmental challenges are now moot.”

CEQA reform promises real benefits for cities in the state that lack affordable housing. The state’s nonpartisan Legislative Analyst’s Office concurs: “These proposed changes have the potential to be an important first step toward addressing California’s housing shortage.”

It’ll even help smaller frustrations: In April, Berkeley bicycle enthusiasts gave up on an effort to install new bike lanes on a two-block stretch of street when they became aware of the onerous CEQA requirements for such a project. If Berkeley can’t get bike paths, something’s gotta give.

A reformed CEQA and an increase in affordable housing would be a victory for all Californians. The Golden State’s unions, however, would prefer to keep their leverage.