Arbitrary Lines: The Case for Zoning Reform
In recent years, most of SPOA’s political advocacy has been directed towards preventing the adoption of destructive new housing policies like rent control, TOPA, eviction sealing, or the transfer tax. We’ve spent less time focusing on the underlying policy failures that have led to Massachusetts’s skyrocketing housing costs.
As discussed previously, the failure of supply growth to keep up with demand growth, both in the Boston area and in other large metros nationwide, is due in no small part to government policies that make it more expensive, more time-consuming, or outright impossible to build new housing. Chief among these policies is zoning, a system of segregating new development based on a set of predetermined use categories. In much of the US today, zoning and other land use regulations create a default ban on most or all categories of efficient, high-density housing that tend to be more affordable than single-family homes when controlling for other factors, requiring expensive, time-consuming, and capricious approval processes for new projects of this type. This increases the average cost of housing, contributing to the housing affordability crisis.
In his new book, Arbitrary Lines: How Zoning Broke the American City and How to Fix It, M. Nolan Gray leads readers through the history of zoning policy in the United States from its origins in the early 20th century through its widespread adoption during the New Deal and postwar era and into the current zoning-dominated equilibrium. The book is a great intro to the topic of zoning and land use regulations for readers unfamiliar with the subject and a convenient summation of a wide range of familiar themes and topics for seasoned YIMBYs. Below is a collection of notable takeaways:
Prior to the introduction of zoning laws in the US, the primary method for managing land use in cities and towns was for residents to seek injunctions against specific uses that created negative externalities. Other uses that were almost certain to cause offense could be preemptively relegated to the outskirts towns.
In 1916, the first two US zoning codes were adopted in New York City and in Berkeley, CA, for very different reasons. In New York, established commercial landlords were dismayed by the rapid increase in the density of new office and residential buildings, which cut into their competitive advantage by increasing supply and driving down real estate prices, so they pushed for density and height restrictions to preserve their market position. In Berkeley, meanwhile, suburban homeowners created the first single-family zoning in order to maintain the city’s exclusivity, including explicit citation of the desire to exclude “negroes and Orientals” in the justification for the zoning ordinance.
Secretary of Commerce (in the Harding and Coolidge administrations) Herbert Hoover pushed for the creation of model zoning legislation, called the Standard Zoning Enabling Act, that could be adopted at the state level and thereby provide the legal basis for municipalities to create their own zoning laws. Despite arguments that zoning constituted an unjustified government taking of the right to use one’s own property, the Supreme Court decided in Euclid v. Ambler (1926) that zoning was a legitimate application of the police power of states.
The growth of suburbia in the mid-20th century was shaped largely by federal incentives regarding zoning: “A combination of federal grants and mandates would gradually work to address the remaining holdouts over the next half century. With the Federal Housing Administration underwriting and often outright financing the building boom that followed the war, federal regulators would condition their support—essential to the growth of new suburbs—on the existence of strict zoning controls, such that adopting zoning was often the first act of a newly incorporated suburb. Successive waves of postwar federal housing legislation would provide grants to develop these ordinances. Similar conditions were placed on other federal grants, which surged during the New Deal and again under the Great Society, such that by the end of the 1970s, nearly every city, town, and hamlet in the United States had adopted zoning.”
Zoning increases the average cost of housing by blocking new housing, requiring housing that is built to be larger and more expensive than what the market would otherwise demand, and adding onerous and unpredictable review processes.
Zoning restricts the growth of the most productive cities, resulting in annual wage losses of $1.6 trillion each year. It’s estimated that eliminating planning regulations in Boston would increase personal income by 13.3%, and that the national increase in wage inequality between 1980 and 2010 would have been 8% smaller without zoning-induced housing shortages in high-productivity cities.
While de jure racial zoning was banned in 1917 (Buchanan v. Warley), de facto racial segregation continued after Euclid–the Federal Housing Administration accelerated the spread of segregation-promoting land use policies at the local level by setting federal underwriting standards that restricted density, required use separation, and redlined predominantly black neighborhoods.
Zoning rules that mandate low-density housing lead to sprawl, which reduces environmental sustainability by increasing commute lengths and requiring more building materials per housing unit.
Gray goes on to propose a number of different reform options. At the local level, he favors ending single-family zoning (including allowing accessory dwelling units), abolishing minimum parking requirements and pricing existing street parking dynamically to promote more efficient use, eliminating or lowering minimum floor area and lot size requirements, and allowing more affordable housing typologies like single room occupancy and manufactured housing. At the state level, he recommends pre-emption of destructive local zoning policies, and at the federal level he endorses competitive grants for more liberal zoning codes. He also explores housing outcomes in Houston, the largest city without zoning, and points out that inclusionary zoning policies, while well-intentioned, tend to raise housing costs without creating significant amounts of new income-restricted housing.
Gray’s work doesn’t end with his writing; he’s also the research director for California YIMBY, one of the most effective housing advocacy organizations in the country. If you’re interested in supporting his work or learning more about the ways in which zoning and other land use regulations affect the cities and towns around us, I’d recommend checking out this book.
by Chris Lehman
