Overview

This intervention is a service system that involves changing relationships between actors, reducing delays, and modifying policies on the local and state level. An improved unhoused tallying system taken twice per year is at the heart of our intervention, whose timely data is then used to more adequately pair the unhoused with short-term, medium-term, and long-term services.

Duration

12 weeks

Focus Areas

Systems Thinking

Systems Design

Research

Team

Melinda Kreuser

Jayesh Jain

Advisor

Dasami Moodley, Product & Social Impact Lead at BCG Digital Ventures

Why should we care?

High housing costs are the major reason California has the nation’s highest rate of functional poverty and the second lowest rate of home ownership, just ahead of New York.

Dan Walters | Cal Matters

The Goal

This multi-phase intervention strives to increase efficiency of services, better synchronize the sectors, take advantage of untapped housing opportunities, and foster a favorable ecosystem for affordable housing creation

Before

• Land Use Planning in California is a highly local process.

• Local Pushback: People already living in the neighborhood for years may worry that the new development will depreciate the value of homes they own, or trigger increases in the rent they pay.

• Environmentalists don’t want legislature tinkering with California Environmental Quality Act. (CEQA). On average it delays a project by 2.5 years.

• Anti-gentrification activists - High-end development only makes a particular locale more attractive to outside investors and wealthy house hunters.

After

• Reframing the the focus of the California administration.

• According to 2018 census data, there are more than 1.2 million vacant homes in California.

• The existing structures aren’t the focus of environmentalists and they don’t need permits.

• By incentivizing the owners of these existing structures, we could probably get at least 100,000 units back to the market ready to be occupied.

Government

• California spent about $13 billion over the last three years to address homelessness, with few visible results.

• A scathing state auditor’s report from February points to a main culprit: a lack of coordination and accountability across the complicated web of state agencies and local counties, cities and service providers.

Lawmakers

• Lawmakers are trying their best to develop effective policies like eviction protection, emergency rental assistance, eviction counseling, diversion & rapid-rehousing.

• The delay is always there as by the time the new policy comes into action, something else breaks in the system.

Non-Profit Organizations

• Various organizations are providing support services to address a variety needs - housing, food, clothing, transportation, child care, veteran and senior services, support groups etc.

• Prompt action is still a far fetched reality.

Healthcare Organizations

• Various health care centers are working actively to improve the delivery of health and social services to people experiencing homelessness, with the goal of promoting care that is responsive, person-centered, and focuses on the patient’s emotional, physical, and psychological needs.

Housing in California

• Land Use Planning in California is a highly local process.

• Local Pushback: People already living in the neighborhood for years may worry that the new development will depress the value of homes they own, or trigger increases in the rent they pay.

• Environmentalists don’t want legislature tinkering with California Environmental Quality Act. (CEQA). On average it delays a project by 2.5 years.

• Anti-gentrification activists - High-end development only makes a particular locale more attractive to outside investors and wealthy house hunters.

Housing in Urban Areas of California

• 7/15 most physically constrained metro areas in USA. are in California. Many of these areas are surrounded by water on 3 sides but have additional limits on where, and when and how much construction can take place.

• Housing there cannot keep up with population growth.

• Short supply - Land expensive.

Lawmaker’s Perspective

• To ease an affordability crisis, the Legislature voted to open suburbs to development, allowing two-units on lots long reserved for single-family homes.

• By allowing two units per parcel and permitting property owners to subdivide their lots, the law would increase density to as many as four units on a single-family plot.

• The bill was furiously opposed by homeowners and local government groups who said it “crushes single-family zoning” and would be “the beginning of the end of homeownership in California.”

Developer’s Perspective

• California home builders would have to construct 220,000 housing units every year for the next two decades to meet demand.

• Many affordable-housing developers worry that they won't be able to make their project pencil out when a new state living-wage law goes into full effect in January, requiring that construction workers be paid at a higher wage for any project receiving subsidies.

• Governor, Gavin Newsom, in 2020 vetoed a bill that would have directed cities and counties to account for evacuation routes and raised fees to cover the costs of clearing flammable vegetation before approving new constructions.

Environmentalist’s Perspective

• A recent building code change for new construction could reduce emissions by eliminating the use of fossil fuels (Natural Gas) thus requiring use of solar panels and batteries (raising prices in an already expensive state).

• Their biggest fear is that these new requirements will drive up the state’s already high construction costs, putting new homes out of reach of middle- and lower-income families that cannot as easily afford the higher upfront costs of cleaner energy and heating equipment.

• Adding solar panels and a battery to a new home can raise its cost by $20,000 or more.

Bottlenecks

Moving away from my earlier practice of breaking down a problem and focusing on each part individually.

Learnings

Always focus on the problem as a whole irrespective of however complex it may seem.