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Building Industry Association of Southern California, Inc <br />ORANGE COUNTY CHAPTER <br />October 16, 2018 <br />Mayor Miguel Pulido <br />Honorable City Council Members <br />City of Santa Ana <br />22 Civic Center Plaza <br />Santa Ana, CA 92702 <br />Re: Rent Control / Stabilization and Inclusionary Zoning Discussion <br />Dear Mayor and Council: <br />On behalf of our membership, I write to express our opposition to Rent <br />Control/Stabilization as well as any expansion of your Housing <br />Opportunity Ordinance. Santa Ana needs real solutions and that requires <br />increasing supply. <br />The Building Industry Association of Southern California, Orange County <br />Chapter (BIA/OC) is a non-profit trade association of over 1,100 member <br />companies employing over 100,000 people affiliated with the home building <br />industry. <br />Counterintuitive to its intent, economists and public policy experts have <br />consistently agreed that a "ceiling on rents reduces the quality and quantity of <br />housing."' In short, rent control had a counterproductive effect that limits the <br />supply of rental housing and when supply is limited, costs increase. <br />Regarding Inclusionary Zoning, a study by Benjamin Powell, Ph.D. and Edward <br />Stringham, Ph.D., titled, Housing Supply and Affordability: Do Affordable <br />Housing Mandates Work?, showed that in the 45 cities where data was <br />available, new housing production drastically decreased by an average of 31% <br />within one year of adopting inclusionary housing policies. Additionally, the <br />study suggests that inclusionary housing polices can increase new housing costs <br />by $22,000 to $44,000, with higher priced markets increasing by $100,000.2 <br />This is further supported in a February 9, 2018 Memo from the City of Portland <br />that found after enacting IZ, "the rate of filing new (building) applications is <br />significantly slower compared to other years," and that this "slow down <br />coincides with new (IZ) requirements..." <br />Further support comes from the non-partisan Legislative Analyst's Office in a <br />report titled Perspectives on Helping Low -Income Californians Afford Housing. <br />In this study, it states that "attempting to address the state's affordability <br />t Paul Krugman. "Reckonings: A Rent Affair," New York Times, June 7, 2000, accessed August 6, 2014. <br />htt ://www.n lmes.com/2000/06/07/o inion/reckonin s a rent affaichtml <br />2 Powell, Benjamin, Ph.D. and Stringham, Edward, Ph.D. Housing supply and Affordability: Do Affordable Housing <br />Mandates Work? Reason Public Policy Institute. April 2004. <br />BIR <br />PRESIDENT <br />MIKE GARTLAN <br />KB HOME <br />VICE PRESIDENT <br />RICK WOOD <br />TRI POINTE HOMES <br />TREASURER/SECRETARY <br />SUNTI KUMJIM <br />MBKHOMES <br />IMMEDIATE PAST PRESIDENT <br />PHILBODEM <br />MERITAGE HOMES <br />TRADE CONTRACTOR V,P, <br />ALAN BOUDREAU <br />BOUDREAU PIPELINE <br />CORPORATION <br />ASSOCIATE VICE PRESIDENT <br />MARK HIMMELSTEIN <br />NEWMEYER & DILLION, LLP <br />MEMBER -AT -LARGE <br />PETER VANEK <br />FOREMOST COMPANIES <br />MEMBER -AT -LARGE <br />SEAN MATSLER <br />MANATT, PHELPS & PHILLIPS, LLP <br />EXECUTIVE OFFICER <br />STEVE LA MOTTE <br />