Putting exclusionary zoning in its place: affordable housing and geographical scale.

• Author: Serkin, Christopher
• Position: 40th Anniversary Symposium

Introduction I. The Local Focus of Exclusionary Zoning II. The Spatial Dynamics of Exclusionary Zoning A. The Needs of Lower-Income Households B. The Problem of Exclusion Reassessed C. Modern Forms of Exclusion III. Rejecting an Ordinance-Centric Focus Conclusion INTRODUCTION

There is a conventional narrative surrounding the term "exclusionary zoning." It describes a particular phenomenon: a suburb adopting large-lot zoning or other density controls that reduce the supply of developable land, thereby driving up prices and making housing unaffordable for lower-income households. (1) This phenomenon, in turn, generates a set of familiar worries about municipalities not bearing their fair share of lower-income households and imposing the associated costs on their neighbors and in particular on the urban core. (2) This relatively parochial frame, however, misses some of the scales at which exclusion operates, and therefore the forms that exclusionary zoning sometimes takes. Expanding the frame reveals problems of exclusion not just at the local level, but at the regional and sub-local levels as well. Exclusionary zoning in its modern form is no longer limited to low-density suburbs, but now occurs also within the urban core and region-wide.

Most responses to exclusionary zoning operate only on the local scale to address the exclusion of lower-income households from suburban municipalities. (3) Most famously, the New Jersey Supreme Court, in Southern Burlington County NAACP v. Township of Mount Laurel, required municipalities to bear their fair share of affordable housing need. (4) New Jersey's legislative response has similarly focused on local governments' fair share obligations. (5) Other states also have a local focus. (6) Massachusetts, for example, gives developers an exemption from local zoning if a municipality does not meet a pre-determined affordable housing quota. (7)

These are appropriate responses to the conventional concern of exclusionary zoning, which consists of a local government using particular zoning techniques to force lower-income households into neighboring municipalities. These tactics benefit the excluding government's tax rolls to the detriment of its neighbors. But an exclusive focus on municipal-level exclusionary zoning misses other important problems, namely: access by lower-income households to public services and higher wages.

In contrast to the traditional focus on inter-local externalities, we argue here that the problem of exclusionary zoning should be viewed first and foremost from the perspective of lower-income households. (8) As a group, they have needs at different geographical scales. They need access to regions where employment opportunities are available and wages are high relative to costs of living. They need access to municipalities that offer an attractive mix of services and taxation. And they need housing opportunities in specific neighborhoods that are not isolated from core public services. Exclusionary zoning can operate in each of these spatial frames independently of one another. The long-standing focus of exclusionary zoning on the content of local ordinances, instead of on these broader exclusionary dynamics, has defined the problem of exclusionary zoning too narrowly. We aim to remedy that deficiency in our contribution to the Fordham Urban Law Journal's Fortieth Anniversary issue.

In Part I we describe traditional accounts of exclusionary zoning. In Part II, we explore the different geographical scales at which exclusion can operate and the varied forms exclusion can take. Finally, in Part III, we discuss the need for more finely-tuned judicial interventions to comprehensively address exclusion in its many forms.

1. THE LOCAL FOCUS OF EXCLUSIONARY ZONING

   Contemporary concerns about exclusionary zoning are intimately bound up with Twentieth Century suburbanization. (9) In the 1940s, middle- and upper-income households increasingly took advantage of improvements in transportation infrastructure to build and buy houses farther and farther outside the urban core. (10) Simultaneously, those newly developing suburbs enacted restrictive zoning ordinances that excluded or limited affordable housing options for lower-income households. (11)

   In addition to blatant discrimination, there are fiscal reasons for exclusionary zoning that are easily observable and well developed in the academic literature. (12) Where public services are funded in significant part by property taxes, owners of lower-valued housing contribute less to those services, receiving an implicit subsidy from owners of higher valued property. (13) The effect is exacerbated if owners of lower-valued property also "consume" more than the average amount of public services by, for example, having more children in the public school. The availability of lower-valued property in a municipality can therefore present tough choices to existing property owners: either pay more in property taxes, or accept cutbacks in the level of public services. (14) Neither is very appealing, so existing property owners have a significant incentive to use "fiscal zoning" to keep out owners of lower-valued property in order to minimize, if not eliminate, the extent of the cross-subsidy from owners of higher-valued to owners of lower-valued property. (15)

   Early writing in this journal described the tangible impacts that resulted from this appetite for exclusionary devices. (16) Large-lot zoning was ubiquitous across suburbs that developed around major cities like New York and Saint Louis. (17) In fact, in the late 1960s, Missouri had a four-year supply of one-third acre lots, but a stunning 350-year supply of one-acre lots. (18) These figures reflect an obvious and significant barrier to new affordable housing development during that period.

   To make matters worse, the political calculation tends to be weighted strongly against affordable housing. The burden of housing price increases is felt primarily by people who are excluded from the municipality--people who are prevented from ever moving in the first place, or who are forced to move out because they cannot afford higher rents. Neither constituency is likely to have much political influence, (19) and the former is unlikely even to self-identify as a constituency. Therefore, local politicians' incentives tend to be dominated in these matters by the interests of local homeowners, who are primarily concerned with maximizing local property values. (20)

   These dynamics led to obvious and predictable outcomes throughout the latter half of the twentieth century. People who could afford to do so began leaving cities en masse, increasing property values and the tax base in suburbs while relegating an increasingly poor population to the inner cities. (21) This "white flight" had a pernicious racial aspect, segregating cities and suburbs into minority and white populations respectively. (22) Cities then faced the dual pressures of a declining tax base and increased demand on public services. (23) In the competition between cities and suburbs, exclusionary zoning was a powerful tool to protect the suburban tax base and keep cities poor.

   Affordable housing, in this view, presents a kind of NIMBY (Not in My Backyard) problem. Every region needs some low-wage workers--whether in service, manufacturing, or government sectors of the regional economy--but no particular municipality wants to house them. Likewise, every region has a dependent population that requires some government support, but every municipality would rather it be provided somewhere else. As the New Jersey Supreme Court therefore recognized in Mr. Laurel, exclusionary zoning creates a kind of inter-local externality, imposing costs on neighboring communities forced to house a disproportionate share of lower-income households. (24) For example, Mount Laurel's exclusionary zoning was primarily to the detriment of Philadelphia, Camden and Trenton, the nearby urban centers. (25) But that same dynamic has played out throughout the country, with suburbs enacting exclusionary zoning ordinances that impose the costs of lower-income households on to the urban core.

   When people think or write about exclusionary zoning, then, they often have this form of inter-local competition at least implicitly in mind: suburbs using large-lot zoning and other density controls to prevent affordable housing options, forcing lower-income households to remain in the urban core. (26) As a result, zoning ordinances identified as "exclusionary" usually involve municipalities limiting density and increasing infrastructure costs, either directly or indirectly. (27)

   What is often missing from the debates and discussion, however, is recognition that exclusion happens at different geographical scales. Regional and sub-local exclusion may be just as problematic as exclusion at the municipal level.

2. THE SPATIAL DYNAMICS OF EXCLUSIONARY ZONING

   Most writing and theorizing about the problem of exclusionary zoning focuses on the geographic scale of the municipality or relevant zoning authority. (28) At first blush, this seems obviously "correct" because responsibility for exclusionary zoning lies with the government that enacted the zoning ordinance. Moreover, exclusionary zoning's role in inter-local competition makes local governments seem like the appropriate scale for analysis because property taxes are collected and many public services--like schools--are provided at the local level. (29) The traditional concern, after all, is with one local government avoiding its fair share of the costs of lower-income households to the detriment of other municipalities.

   The local focus is due in part to the fact that the most successful legal challenges to exclusionary zoning have relied on this theory of inter-local externalities and the unreasonable application of state police power. (30) In contrast, federal constitutional challenges by excluded residents...