Regulation - the bane of affordable housing development, or essential?
Red Tape: Everybody hates it. Nobody needs it.
When it comes to affordable housing, red tape is taking the blame for high costs. It is being disparaged by many actors — the building industry, governments, activists.
So by all means, let’s agree to stamp out affordable housing red tape.
Except . . . what is it?
In the most general sense, it is paperwork that wastes time, costs money and impedes progress. But a good beach-read paperback book nicely fits that definition.
For a more productive view of red tape, particularly as it applies to affordable housing, we can explore further by viewing red tape through the eyes of major players in efforts to deal with an affordable housing crisis.
The Housing Industry Viewpoint
Affordable housing red tape impacts profoundly on the financiers, developers and builders who comprise the housing industry. They certainly squawk longest and loudest about it. Thanks to relentless lobbying, their viewpoint exerts a strong influence on all affordable housing actors. That influence is not necessarily always a positive one.
Let’s explore how the housing industry might build more cheaply, and how their view of red tape fits into the picture.
Consider building without foundations. Literally. Just lay the first planks right on the dirt. (Maybe level it a bit first). Big savings!
Would the housing industry ever push this solution in order to build cheaper affordable housing? Never! Think of rotting wood, collapsing walls, tornado destruction, lawsuits, construction companies driven out of business.
So, casting about, what methods of making housing cheaper might become the darlings of the housing construction industry? Flash forward to a house completed and sold, long gone from the responsible hands of the builders. What kinds of issues probably won’t come back to bite a builder in the pocketbook?
Why, ongoing neighbourhood, community, social and health issues. They won’t come back to bite builders as long as the house was built to compliance with the stack of regulations that define the scope of those neighbourhood, community, social and health issues. Any or all of those can, and do, impact on the cost of building the house.
With this in mind, regardless of how important any or all of those issues might be, the housing industry can press to eliminate of any or all of of those restrictive rules and regulations. With this ‘red tape’ eliminated, housing can indeed be built more cheaply.
Not surprisingly, the house building industry relentlessly lobbies for just such a vision of red tape. To the housing industry, red tape is any rule or regulation applied to housing that is not directly related to structural integrity and safety, which are at least grudgingly accepted. But all the rest of it? It’s nothing but obstructionist invention by faceless bureaucrats with a mean streak — those gnawing little people who swarm at the ankles of construction superheroes.
The Municipal/Community Viewpoint
All those reams of rules and regulations that are the bane of the housing industry are the bread and butter of municipal councils and supporting civil servants employed to ply their expertise in by-law and zoning regulation.
For municipalities and regions, those rules and regulations are the virtual construction platform upon which the physical house is placed. This virtual foundation defines the interaction between the house and its community, balancing the interests of individual tenants and owners, their neighbours, passers by and community members individually and collectively. Further, it is the blueprint that integrates a municipality with its physical structure — soft services such as schools and libraries, hard services such as sewage and water.
Only a small portion of this dynamic housing foundation is red tape. And part of the everyday task of managing the structure of a healthy habitable city is the identification of unnecessary regulation. Ongoing evaluation of rules and regulations pares away those that are no longer relevant, or need modifying in order to better serve their purpose.
Regulating donkey carts in downtown laneways? In a modern town, if it’s still on the books, it’s quite probably red tape. Such occasional discoveries make for fun news brighteners, but are unlikely to be part of a dust mountain of red tape buried in the deepest, coldest recesses of a modern city archive.
We have taken a peek at two wildly different perspectives about red tape. One — the industry view — considers most rules and regulations to be red tape. The other — the community view, expects very few of the rules and regulations to be red tape.
What damage might be done by approaching an affordable housing crisis from one or the other view of red tape?
The Region/County/Province/State View
Many higher level governments take on complementary zoning and by-law responsibilities that provide a framework for municipal and community regulations. Where this is the case, at least some portion of these governments may view red tape in the same way that municipalities do: that is, red tape as the remains of an outdated regulation to be pruned away from, or refurbished into, a larger body of otherwise necessary rules and by-laws.
But higher level governments also have a fiscal responsibility, which require oversight of money being spent. With oversight can come both the usefulness of detachment, but also the naivety of inexperience. And detachment can add up to undue influence by lobbyists for a particular version of red tape.
An article from Georgia expresses how some of this undue influence appears to be playing out at a state legislature level. Concerned about the impact of the affordable housing crisis on Georgia, the state has decided to study the situation. All well and good. But look at how one view of red tape (in this case the housing industry view) becomes firmly and uncritically accepted as a means of reducing construction costs. Georgia’s House Bill 591 calls for a study that begins with bald assumptions rather than studying towards a researched conclusion:
“. . . requirements of residential design mandates exist outside the realm of building integrity and have no connection to the safety and welfare of the citizens of Georgia.”
Read more in The Gainesville Times: How A State Committee Intends To Explore Solutions To Affordable Housing Crisis
This point of view simply dismisses the many lifetimes of municipal wrestling with “the safety and welfare of the citizens” in determining building codes, zoning and other by-laws. These must reflect the intersecting needs of all its citizens as well as the structure of the city as a whole, not just individual freedom-loving kinglets in their private ‘don’t tread on me’ castles.
Meanwhile, the same article discusses the more dynamic municipal notion of red tape by exploring Gainsville’s modifications to a body of rules and regulations that is largely necessary, not largely red tape. It’s a blueprint for a city that, far from needing fewer rules, may actually need more in order to function more effectively and efficiently.
For an example of a city currently looking to strengthen rather than weaken regulations, read more at WFAE 90.7: Finding Home: To Prevent Squalid Housing, Charlotte Looks To Strengthen Code
The Philosophical/Religious/Political View
Since bills are passed by political bodies, not cadres of civil servants, it would be foolish to assume that red tape is an entirely practical construction, not influenced by attitudes and politics. Such a point of view yields results very different than the municipal point of view about red tape. Read more in Bacon’s Rebellion: Want More Affordable Housing? Try Free Markets.
Here, close to the beginning of the article, we find a startling, sweeping, and possibly simple-minded conclusion from testimony before a congressional committee. It begins, rather than ends, any discussion about red tape: “Contemporary American land use law embodies the bad idea that private land ought to be publicly planned.”
Uh oh. We’ve wandered into the land of ‘good’ and ‘bad.’ My home is my castle: good. My city wants to regulate it: bad. Planning, in other words, is red tape. Here’s a point of view even more sweeping than that of the housing industry!
A Research Point of View
In showcasing a housing industry argument for cutting red tape, we’ve so far ignored one of the most persistent claims: cutting regulation will cause housing to become affordable. If red tape is eliminated, particularly red tape that defines the character of a neighbourhood (e.g. single family zoning), then the housing industry will be free to build so much more housing that prices will fall and housing will become more affordable.
Really? Are we really supposed to swallow that the profit-based housing industry will work to drive down housing prices, which includes their profits? No matter. There’s also research to challenge the idea that prices are driven downwards by increasing density in a neighbourhood. Try . . . .Just Build More Housing? These Days, The Idea Rules, But Without Clothes
Could it be that zoning, which preserves the character of single family neighbourhoods, is not after all the sacrificial ‘red tape’ that simply has to be eliminated?