Month: August 2014

Recidivism and Realignment

Early feedback is starting to come in about corrections realignment, the 2011 shift of responsibility for more than 30,000 criminal offenders from the state level to the counties. The issue continues to dominate discussion in the California public safety community. But there are still many questions to be answered about how counties are implementing the changes and what effect realignment is having on criminal behavior.

Last Friday, research fellow Ryken Grattet spoke at a Sacramento briefing about PPIC’s latest research, which looked at recidivism rates for released offenders now being supervised by county probation departments. The study found that offenders released to counties that emphasized reentry services did better than those released to counties that emphasized traditional law enforcement, at least in the first months after realignment. After the briefing, Grattet was joined in the question-and-answer period by his coauthor, research fellow Mia Bird.

Drought Watch: Trends in Urban Water Use

This is part of a continuing series on the impact of the drought.

Most of California is now in an exceptional drought, but water use statewide has actually increased over the last year. In response, the state has imposed short-term restrictions intended to help us get through the current drought. As state and local water agencies look beyond the current emergency for ways to adapt to a future in which droughts are likely to be more frequent and more severe, it is instructive to examine and compare urban use in two relatively normal water years, 2000 and 2010.

First, the good news: Total statewide urban water use (for residential, commercial, and industrial purposes) decreased by 12 percent from 2000 to 2010, even as California’s population increased by more than three million. Reductions have been especially significant in central and southern California, where investments in conservation programs and new technologies seem to be paying off. In the commercial and industrial sectors, water use fell 36 percent and 18 percent, respectively, while residential interior water use declined by 20 percent overall and 27 percent per capita. The Great Recession probably played a role in these reductions, so it will be interesting to see if this trend holds as the economy continues its recovery.

Now for the bad news: Outdoor water use for both residential exteriors and large (commercial or public) landscapes rose 12 percent across the state between 2000 and 2010. This trend was largely driven by increases in southern California—in marked contrast to the region’s reductions in indoor water use. And it is likely to persist as California’s population continues to grow, especially in hot and arid inland areas with a higher proportion of single-family homes (which use twice as much water outdoors per household as multi-family buildings) and large lots.

One important takeaway is that more stringent building codes, increasing efficiency requirements, and new technologies seem to have resulted in more efficient indoor water use. But when it comes to landscaping, any improvements in irrigation technology seem to have been offset by our taste for large lawns and plants that need a lot of water (and our habit of overwatering them). To encourage long-term reductions in outdoor water use, agencies can implement new pricing structures, turf buy-back programs, and public education programs emphasizing drought-friendly landscaping. After our current water emergency ends, these long-term incentives and outreach efforts can help us be better prepared for future droughts.

(The map below shows the change in per capita outdoor urban water use between 2000 and 2010 in each hydrologic region. To see details of the state’s hydrologic regions, including county boundaries, visit our Map Room.)

Chart source: California Department of Water Resources.

The Decline of the Homeowner

Homeownership is on the wane in California. Between 2006 and 2012, the number of owner-occupied housing units in California declined by more than 320,000, while the number of renter-occupied housing units increased by more than 720,000. Never before has the state seen such dramatic declines in the number of owner-occupied houses. As a result, homeownership rates in California are at their lowest levels in more than 50 years.

The decline in owning and the rise in renting are largely a result of the housing bust between 2007 and 2011. Single-family housing units, long the primary domain of the homeowner in California, were the most likely to be lost to foreclosure. Thousands of owner-occupied homes were sold or foreclosed upon, and many became rentals.

However, even during the bust, housing prices remained relatively high in the state’s heavily populated coastal areas, which meant that ownership continued to be unaffordable for many renters who might prefer to buy. It may come as no surprise that states with low housing prices tend to have the highest homeownership rates. For example, median home values in West Virginia and Michigan are among the lowest in the nation—less than $120,000 in 2012—and rates of homeownership in those states are above 70 percent—among the highest in the nation. In contrast, in New York, California, and Hawaii, housing values are high and homeownership rates are among the lowest in the nation.

Housing construction in California reflects the increase in demand for rentals. In recent years, most new construction has consisted of large multi-unit buildings, most of which are rentals. This focus on multi-unit construction also reflects a shift among planners and local officials toward encouraging high-density in-fill development. This shift is especially apparent in expensive coastal housing markets where there is not a lot of room for new housing. In Los Angeles County, multi-unit buildings accounted for 86 percent of the increase in occupied housing units between 2010 and 2014. In the Bay Area, 60 percent of net new occupied housing units were in multi-unit buildings. By contrast, in inland areas such as Sacramento County and the Inland Empire, three of every four newly occupied housing units were single-family dwellings.

These newly constructed multi-family units make up just a fraction of the recent growth in renter households. Conversions of owner-occupied single-family homes to rentals have captured a large portion of growth in renter-occupied units. Between 2006 and 2012, 60 percent of the increase in rented occupied units occurred in single-family units (about 436,000 units). In 2006, before the bust, only 21 percent of occupied single-family houses were rented; by 2012, the share of houses occupied by renters had increased to 26.0 percent.

Will the trend toward renting reverse as the state’s economy continues to recover? A key consideration is whether the rise in renting represents a long-term shift in preferences. High home prices and past volatility in the housing market may have led many to conclude that owning a home is simply not worth the risk. On the other hand, rapidly rising rents have made homeownership relatively more attractive. And all this is happening as large numbers of young adults are reaching prime ages for starting a household and buying a first home. If historic trends are any indication, these demographic forces—along with low interest rates and improved labor markets—should lead to increases in homeownership rates.

Chart sources: (top and bottom) Authors’ calculations based on American Community Survey data; (middle) SOCDS Building Permits Database.

Drought Watch: Support for the Water Bond

This is part of a continuing series on the impact of the drought.

With the effects of the drought intensifying, the water bond is at the top of the legislature’s to-do list. Unless an agreement is reached on a new version, the $11.1 billion bond built in 2009 will go before voters this November. This year we have seen a range of proposals for a smaller water bond—including one by Governor Brown and one by Senate Republicans that designates more funding for storage than the governor’s. The debate continues.

Getting approval by two-thirds of both houses of the legislature is just the first step. The next hurdle is voter approval. According to the July PPIC statewide survey, 51 percent of likely voters said they would vote yes on the current $11.1 billion bond, with support increasing to 59 percent if the bond amount were smaller. This is higher than in March 2013, when only 42 percent of likely voters said they would vote yes on the $11.1 billion bond, and 55 percent supporting a smaller bond.

While the size of this bond may be important for voter approval, the central policy debate is about how the money should be allocated. Most funding for California’s water system comes from local water bills and taxes, but a new state water bond could help close critical funding gaps facing some parts of the water sector. The PPIC report Paying for Water in California highlighted the lack of sustainable and reliable funding for drinking water quality in small systems, flood protection, stormwater management, aquatic ecosystem management, and integrated water management.

Even if the legislature and the voting public do come together to approve a new bond, there is still work to be done to ensure sustainable funding for our water system. A bond can be expected to provide about $1 billion per year in new funds, leaving a $1 to $2 billion annual funding gap for critical water services. To close this gap, Californians will need to go beyond bonds and approve a broader mix of revenues, such as water use surcharges or state sales tax increases.

The Politics of Global Warming

The Global Warming Solutions Act, AB 32, was passed with bipartisan support and signed by Republican governor Arnold Schwarzenegger in 2006. The law—which requires state to reduce its greenhouse gas emissions—received strong majority support (65%) among Californians when the PPIC Statewide Survey first asked about it in July 2006, with strong majorities of Democrats (67%), Republicans (65%), and independents (68%) in favor.

Overall support for the law remains strong: in our July 2014 survey, 68 percent of Californians said they favored it. But the partisan makeup of the supporters has changed significantly. While support among Democrats and independents has remained solid, it has gradually decreased among Republicans. Today, 81 percent of Democrats and 62 percent of independents favor the law, but only 39 percent of Republicans do.

What happened?

We have found that this partisan divide is linked to two main factors. The first is the increasingly common belief among Republicans that global warming is not imminent. Fewer Republicans today say the effects of global warming have already begun (47% 2006, 35% today) or that global warming poses a serious threat to California (57% 2006, 48% today). Attitudes among Democrats and independents have not changed much.

The second factor is rising concern among Republicans that addressing global warming will affect the economy and jobs. From the beginning, proponents of AB 32 have argued that the threat posed by global warming requires immediate state action and opponents have expressed concern about the economic impact of regulating greenhouse gases. Our survey shows that during the Great Recession, support for taking action right away declined among all Californians. Support did not drop much among Democrats and independents, and it bounced back as the economy recovered. But immediate action on global warming was never popular among Republicans, so perhaps it is not surprising that even as the state’s unemployment rate declined from its peak in 2010 most Republicans continued to say the state should wait until the economy improved.

Their differences may be growing, but partisans do still agree on some aspects of addressing global warming. Majorities across parties continue to favor requiring increasing energy efficiency for residential and commercial buildings and appliances. They also favor requiring industrial plants, oil refineries, and commercial facilities to reduce their emissions.

These results show that policymakers face a challenge in forging compromises on the contentious aspects of climate change policy. But they also have areas of consensus to build on.

Bay Area Tops in Population Growth Rates

For many decades, inland areas of California have experienced faster population growth rates than coastal areas. Indeed, from 1950 to 2010 the Inland Empire (Riverside and San Bernardino Counties) experienced the most rapid rate of population growth in California. But now, for the first time since the 1860s, the Bay Area—long the slowest-growing urban region—is experiencing faster growth rates than any other region of the state.

Clearly, the Bay Area’s strong economy has led to this growth. With robust job gains and relatively high wages, demand to live in the Bay Area is very high. To some extent, local authorities and builders have responded to this demand with new housing construction, much of it multi-unit housing in densely populated areas. Population growth has been especially strong in Santa Clara and Alameda Counties, but San Francisco and San Mateo Counties are also outpacing the more suburban parts of the Bay Area, such as Sonoma and Solano Counties.

In contrast, inland areas are still recovering from the recession and housing bust that hit them hard at the end of the last decade. Declines in employment and very high rates of foreclosure were centered on these inland regions, including the Inland Empire, the San Joaquin Valley, and Sacramento.

Some might say this is not an important shift in regional growth patterns. After all, at 1.0 percent annual growth, Bay Area populations are not exactly exploding. But growth rates in the Bay Area are twice as high this decade as they were in the previous one, and no one expected the Bay Area to be the fastest-growing region of the state—according to long-term projections, inland areas will have faster growth rates than coastal areas. If recent patterns persist, this conventional wisdom will be turned on its head, and the implications for California’s future—from transportation infrastructure to water demand—could be enormous. As the economic recovery spreads throughout the state, it is reasonable to expect that inland growth will pick up, but to what extent and for how long is highly uncertain.

Chart Source: Author’s calculations based on California Department of Finance data.

Climate Change, Fracking, and Drought—Oh My!

Last week’s release of the PPIC Statewide Survey: Californians and the Environment prompted a discussion of several major policy issues under consideration in Sacramento. A panel convened by PPIC talked about the survey’s findings on climate change policy, particularly public attitudes toward a potential increase in gas prices when new regulations for transportation fuels begin next year.

PPIC research associate Sonja Petek set the stage for the panel discussion by presenting the survey findings. The panel included Assemblyman Richard Bloom (D-Santa Monica); Anne Baker, a senior advisor at the Center for Energy Efficiency and Renewable Technologies; and Rob Lapsley, president of the California Business Roundtable. The panelists said they supported the goals of the state’s climate change policies. They encouraged a public education effort about the extension of the cap-and-trade program to transportation fuels. The survey found that most Californians also support the policy change, but support drops sharply if it means higher gas prices.

The panel was divided on the state’s approach to fracking, a controversial process for extracting underground oil. Bloom is the author of a bill calling for a moratorium on fracking. Lapsley described the economic benefit of having more in-state oil production. The survey found most Californians opposed to fracking.

The panel also discussed water policies and the drought. In the survey, Californians name water as the number one environmental issue this year, and a narrow majority of likely voters support an $11.1 billion bond that is scheduled for the November ballot. Support is higher for a lower bond amount, something that is under discussion in the Capitol.