Republicans Concerned About Housing Shortage, Local Zoning Rules

A joint hearing of the Assembly and Senate committees on housing discussed Wisconsin’s affordable housing shortage on Tuesday. Photo by Henry Redman/Wisconsin Examiner.

This week, Stevens Point residents attended a city council meeting to fight against a neighbor’s efforts to build an extension to their garage so their ailing in-laws have a place to move in.

Earlier this year, Madison residents mounted a campaign against the city’s efforts to change zoning rules to allow higher density apartments near future stops on the soon-to-be-built Bus Rapid Transit line. Another effort in Madison would  stop a developer’s proposal for a new apartment complex, by attempting to get a historical landmark designation for a former credit union building because former President Harry Truman dedicated the structure in 1950.

In Wauwatosa, local opposition led to the death of a proposed high rise apartment tower that would have included more than 300 units. Instead, the developer plans to build a car wash at the intersection.

This local opposition to housing projects comes even as nearly all corners of the state face a shortage of affordable housing. On Tuesday, the housing committees of the state Assembly and Senate met for an informational hearing on the problem and potential solutions.

The crux of the problem, according to UW-Madison professor Kurt Paulsen, who testified before the committee, is supply and demand. The state’s 20 largest counties have been underproducing housing units, apartment units and single family homes, as demand has continued to go up. Data Paulsen presented showed that the largest counties have built 26,000 fewer units than they needed to over the last 15 years and that most of the state’s largest job centers have more jobs than housing units available.

Paulsen said there are five interconnected crises causing the state’s housing shortage. First, there’s the shortage of all types of housing, from large single-family homes to mid-sized options such as condos, duplexes and townhouses and even large apartment complexes. Without a full range of all available options, Paulsen said, affordability suffers, “because if someone can’t find a home in a decent neighborhood at a price that they can afford, they’re going to take the next unit available. So that means price pressures throughout.”

Beyond the supply, a large portion of the state’s residents are considered “burdened” by the cost of their housing, meaning they’re spending upwards of 50% of their income on rent or mortgage payments. A large amount of the existing supply of housing is aging and will no longer be a viable option for people to live in without significant and expensive upgrades or renovation.

All of these problems are combining, Paulsen said, to most dramatically keep young people, first time homebuyers and people of color from purchasing their own homes.

“This is also our future workforce, our community residents now and in the future,” Paulsen said. “So the ability to own a home and stabilize neighborhoods and invest is just vitally crucial to our future success as a state.”

The Republicans on the two committees appeared to hone in on local zoning rules as a potential target for legislation aiming to build more affordable housing. Several speakers at the hearing, including Paulsen and policy analysts from the conservative Wisconsin Institute for Law & Liberty (WILL), pointed to local rules such as minimum lot sizes, parking requirements and square footage restrictions as regulations that only serve to add costs and delays — as well as opportunity for community pushback against needed new housing — to proposed projects.

“In terms of regulatory reforms, zoning, parking requirements, all of the myriad local government regulations that constrain the supply of housing, the availability of housing and the type and price of the housing,” Paulsen said, “as we like to say, housing dies a death of 1,000 cuts. You go into a plan commission three, four, five times in a row and it’s knocked down from 200 units to 187 to 140, and a story is lopped off the building and additional parking and landscaping and by the time you’re done, the prices of what’s available is really expensive.”

The analysts from WILL, Noah Diekemper and Kyle Koenen, were pushing for the adoption of by-right zoning across the state, which would allow a landowner to build whatever type of housing they want on a piece of property so long as it complies with building and safety codes. The WILL proposals, which Koenen said come from a “center-right” perspective of wanting to reduce government regulations of the housing market, are similar to recent reforms passed by the Democratic-majority California Legislature and signed into law by its Democratic Gov. Gavin Newsom.

Under current zoning rules in communities across the state, someone proposing a project that doesn’t perfectly align with the rules can apply for a conditional use permit, which would allow the construction to move forward. However, that permit requires multiple layers of approval from local plan commissions and common councils, each with possible veto points for other community members.

Koenen and Diekemper complained that zoning rules often make it illegal or unaffordable to build certain types of housing — row houses, in-law suites on garages, smaller apartment buildings and others — that they believe are clearly needed to help lessen the housing shortage.

Moving to by-right zoning, Diekemper said, would make it “more of an option for people who own a piece of land to build on that [land] what they want to build … that will allow the market to meet the demand for housing where it is.”

Curt Witynski, retired lobbyist for the League of Wisconsin Municipalities, testified that the league has already encouraged its members to start making “incremental” steps toward loosening zoning restrictions as a way to encourage the construction of more housing, but he said the state’s municipalities would be wary of any mandates passed by the Legislature and would instead prefer incentives to make any reforms.

The league’s “Guide to Neighborhood Affordability” encourages municipalities to take steps such as reducing minimum lot sizes, allowing multi-family housing in areas zoned for single-family homes, eliminating parking requirements and making the approval process faster.

“It looks like the theme of this morning’s testimony from folks is that municipalities, our local regulatory environment, is the primary cause for the housing crisis and I got to push back against that,” Witynski said. “It is a contributing cause, I will acknowledge that … but I want to caution the committees if they have a sense that OK, if the state mandates certain zoning code changes for all municipalities in the state that would solve our housing crisis,’ I highly doubt that would be the case.”

Legislators said that as they’re crafting legislation, they need to find the right balance between the “carrot and the stick” when it comes to getting municipal governments to start allowing more construction.

“But the idea of the carrot and the stick, it’s going to be a little bit of both,” said Rep. Robert Brooks (R-Saukville), the Assembly committee’s chair. “And the carrot, as we roll out some of these bills, is going to be in order for you to even get that carrot, you must comply with these things.” He did not specify what particular incentives might be offered.

Brooks said at the end of the meeting a large package of housing-related bills is going to be announced in the next three or so weeks. Rep. Jodi Emerson (D-Eau Claire) said Democrats on the committees haven’t been looped in on the legislation, yet she’s interested in what will be proposed.

“I’d be interested to see what Brooks has got,” Emerson told the Wisconsin Examiner. “It might help, it might not, I don’t know. I’m hoping we can come to some resolution with this because the state of Wisconsin, if we don’t, is going to be really hurting.”

Emerson says that beyond the topics discussed in the hearing, she hopes any housing reforms can make it easier for communities to think outside the box as they find ways to increase their housing stock. For example, she says, she would like to see an effort to adjust zoning to allow shuttered shopping malls, schools and nursing homes to be converted to  housing complexes.

Republican legislators take aim at local zoning rules to address Wisconsin’s housing shortage was originally published by the Wisconsin Examiner.