Under the mantra of “stopping sprawl,” urban planners have crammed nearly 95 percent of Californians into just 5.1 percent of the state’s land area. The nation’s three densest urban areas, and 11 of the 20 densest urban areas, are all in California. Thanks to urban‐growth boundaries, greenbelts and other planning restrictions, the average California urbanite lives in communities that are 80 percent denser than in the rest of the country.
In addition to extraordinarily high housing prices, this density drives up business costs, taxes and traffic congestion.
LAFCOs trap taxpayers
It wasn’t always this way. In the 1960s, California was growing much faster than it is today, yet housing was no more expensive than in most other parts of the country. California was growing so fast that cities often competed with one another over which would get to annex (and collect taxes on) land suitable for development.
To minimize such competition, in 1963 the California Legislature created a local area formation commission (LAFCO) for each county. These commissions could approve or veto the formation of new cities or special service districts and annexations to those cities or districts. Most commissions were dominated by representatives of the city councils in each county.
The cities soon realized they could use LAFCOs to keep most taxpayers within their boundaries. No longer could a developer build houses on vacant land outside of a city’s limits and incorporate a new city or service district to provide the water, sewer and other infrastructure needs for those homes.
After eliminating the competition from such developments, cities could impose costly and time‐consuming planning restrictions that further drove up housing costs. What was portrayed in public as a war on sprawl was, in reality, a war on taxpayers seeking to escape the high tax rates imposed by cities.
Scarcity drives up prices
In fact, a war on sprawl was and is unnecessary. If Californians could live at the same densities as the rest of the U.S., the state’s urban areas would cover 8.5 percent of the state instead of 5.1 percent. Is it really worth paying three times as much as most of the rest of the country for homes in order to save 3.4 percent of the state from development?