'Inclusionary Zoning' Backers Say Living-Wage Data Makes the Case
Los Angeles Garment & Citizen - June 6, 2005

Proponents of an "inclusionary zoning" ordinance that would require a certain amount of residential units to be offered at "affordable" rates in developments citywide ramped up their efforts last week, claiming that a recent study on the city's living-wage regulation amounts to proof that fears about changes to housing policy are overblown.

Affordable housing generally refers to units for sale or rent at prices within the budget range of households with annual incomes of less than 80 percent of the median for the region. A four-member household with annual income of approximately $40,000 would qualify for affordable housing, for example. The living-wage ordinance requires most companies with city contracts to pay their employees at least $8.78 an hour with healthcare benefits, or $10.03 an hour without.

A June 3 press conference at City Hall had some proponents drawing links between the living-wage study and the push for inclusionary zoning. Among the elected officials at the press conference were 1st District City Councilmember Ed Reyes, the 7th District's Alex Padilla, and 45th District California State Assemblymember Jackie Goldberg.

Reyes and 13th District Councilmember Eric Garcetti have led the push for the inclusionary zoning ordinance in the 15-memer body, which could take up the matter as early as this week.

Some proponents of the inclusionary zoning plan recalled a debate several years ago over the living-wage ordinance, when many opponents forecast grim results, claiming that the requirement would cost jobs by prompting employers to cut staffing levels to offset the higher wages.

Inclusionary zoning backers used the press conference to highlight results of the recent study, which found that the living-wage ordinance has led to pay hikes for 10,000 jobs in Los Angeles, with a relatively decline in employment of 1 percent. The majority of jobs affected by the ordinance are at Los Angeles International Airport and Ontario International Airport. The average pay increase mandated by the living-wage ordinance came to $1.50 per hour, or $2,600 per year, according to the study.

The study also found what it's authors described as some significant benefits for employers who have been required to pay the increased wages, including reductions in employee turnover and absenteeism. The reduced turnover rate, which often means lower costs for recruitment and training, has helped employers recover 16 percent of the wage-hike, according to the study.

The non-profit Ford Foundation, the University of California Institute for Industrial Relations, and Los Angeles World Airports-a city-owned entity that operates Los Angeles International Airport and other facilities-funded the study. Economists from the non-profit Los Angeles Alliance for a New Economy (LAANE), UCLA and the University of California at Riverside conducted the study.

LAANE spokesperson Danny Feingold said the group hopes the study will short-circuit some of the arguments against the inclusionary zoning ordinance.

"During the living-wage debate, opponents said it would drive businesses out of the city and result in a catastrophe-and those same arguments are being used on inclusionary zoning," Feingold said. "Now we have hard evidence that the sky didn't fall."

The living-wage study-and efforts to link it to the debate over inclusionary zoning-is unlikely to soften up opposition among many in the business community Downtown, however. Many real estate developers and business advocates claim that mandatory regulations for affordable units will drive costs up and force developers out of the city at a time when it faces a housing shortage.

The Central City Association (CCA), a leading business advocacy group Downtown, has offered a counterproposal to the inclusionary zoning ordinance. The CCA plan would rely on incentives rather than requirements to foster more affordable housing in the city, and the group's efforts earned plaudits from Garcetti several months ago. More recently, however, the timing and specifics of a widely anticipated revised version of the proposal have remained unknown, casting doubts on any compromise that might allay developers' concerns.

The debate could turn as much on politics as policy, too.

The proposed inclusionary zoning ordinance has long been claimed as a key issue by vocal supporters, including community activists and elected officials who often describe themselves as "progressive."

But the issue drew relatively little attention during the recent mayoral campaign, when many of its backers-including Garcetti and Reyes-supported Los Angeles Mayor James K. Hahn's bid for reelection even though he opposed inclusionary zoning. LAANE executive director Madeline Janis Aparicio, meanwhile, is a Hahn appointee to the board of directors of the Community Redevelopment Agency of Los Angeles.

The recent moves to put the inclusionary zoning debate back on the front burner come as 14th District Councilmember Antonio Villaraigosa, who beat Hahn handily in the May 17 vote, prepares for his transition to the top office (see related story, page 1). Villaraigosa initially backed the concept of inclusionary zoning, and has more recently said that he wants to review any revisions to the proposal.

The timing of the ordinance could force Villaraigosa into a decision prior to shift from the City Council to the mayor's office, a development that holds the potential to provide an early benchmark on his relations with the business community and backers of the ordinance.

But the proposed ordinance could face an uphill battle in the 15-member council in any case, meaning Villaraigosa may not have to deal with it if a vote comes after he has been sworn in as mayor. However, passage in the City Council after Villaraigosa's swearing in would put him in position to sign or veto the ordinance-and might also provide the chance for him to display his highly vaunted consensus-building skills.

 

 

LosAngelesLivingWageStudy.org