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January 2018, Volume 24, Number 1

California: Fires, Housing

Napa and Sonoma counties were affected by wildfires in October 2017 spread by very high winds. Over 4,700 homes were destroyed, including 3,000 in Santa Rosa, and 10,000 were damaged; 43 people died and 100,000 people were displaced by the fires. Insured losses are over $7.5 billion, making the October 2017 fires the most costly in US history.

With an unemployment rate of less than three percent in a county adding jobs faster than homes, median home prices in Sonoma county topped $650,000 in November 2017.

The fires were likely caused by sparking power lines downed by winds that gusted to more than 70 mph. The 2017 wine grape harvest was almost completed when the fires broke out, so speculation centered on the longer term effects of the fires on wineries and their workers, some of whom lost both wages and their housing.

Many farm workers are renters, and some rental housing that was burned is being replaced with more costly housing. Rents rose sharply in Napa and Sonoma counties as more people sought fewer available rental units and some homes that previously commanded premium rates for short-term visitors were made available to long-term renters. The gap between homeowners with insurance and renters without insurance may drive some renters who lost their housing out of the area.

Preventing fires in high-wind and arid areas traditionally involves using fire-resistant building materials and clearing vegetation around structures. Some say the lesson of the October 2017 fires is the need to bury utility lines and to shut down power to above-ground power lines in rural areas before major wind events to prevent ignitions. California is prone to high winds during its fall dry season, so shutting off power before major wind events could prevent fires.

San Diego Gas & Electric, which has a very sophisticated weather-monitoring system, turns off power to some rural residents before strong Santa Anna winds.

Fires fueled by east-west Santa Ana winds burned for three weeks in southern California in December 2017, destroying over 1,000 structures and forcing over 200,000 people to evacuate. Ventura and Santa Barbara counties were hardest hit, as the Thomas fire raced north of state highway 126, which runs from Santa Paula to Ventura, into Santa Barbara county. It burned over 273,000 acres, making it the largest in California history, surpassing the Cedar fire in San Diego county in 2003. Over 8,000 fire fighters battled the Thomas fire, constituting the greatest mobilization in California history.

Much of Ventura county agriculture is between Ventura and Oxnard. Although this area did not burn, some farm worker housing was destroyed. Some of the 18,000 acres of avocados in Ventura county that were planted on hillsides burned.

California had three years of drought followed by a very wet 2016-17, providing fuel for fires. Northern California began to receive winter rains in October 2017, but southern California did not. Some climate models suggest that global warming will push more of California's rains into January and February, lengthening the fall fire season.

The state fire fighting agency Cal Fire is on track to spend more money in 2017 than ever before; Cal Fire says that 13 of the 20 largest wild fires of the past century have occurred since 2002. California has 11,000 fire departments, and some urge changing planning practices and building codes to reduce the need for firefighters rather than spending more to fight fires.

Most local development agencies are implementing policies to expedite rebuilding. Some fire experts say this a mistake. They urge cities to buy vacant land or the development rights on vacant land so that developers cannot build in fire-prone areas and to refuse to allow the rebuilding of structures that were burned twice by wildfires. If local governments had to bear the full costs of fighting fires, rather than having the federal and state governments absorb most of the cost of firefighting, they would likely approve fewer new developments in fire-prone areas.

Housing. Even before the fires, affordable housing in Napa and Sonoma counties was scarce, forcing many farm and nonfarm workers to commute to jobs in these counties from lower-cost areas. A quarter of Sonoma county residents are Latino, and many Latinos employed in agriculture lived in rental housing that was burned.

The fires aggravated the gap between wages and living costs in Napa and Sonoma compared to the San Joaquin Valley. The HUD Fair Market Rent for a two-bedroom apartment in Napa county was $1,500 and $1,400 in Sonoma county in 2017. A worker earning $15 an hour in Napa-Sonoma for 160 hours a month would pay over half of his $2,400 monthly earnings in rent. In Fresno, Kern, and other San Joaquin Valley counties, Fair Market Rents are half of levels in Napa and Sonoma, but wages are two-thirds or more of Napa-Sonoma levels, making it easier to afford for San Joaquin Valley workers to afford housing.

By November 2017, rents for housing were rising. Zillow reported median rents of $2.25 a square foot in Napa county, meaning a 1,300-square foot house would rent for over $2,900 a month. Sonoma county median rents were higher, a median $2.40 a square foot or over $3,000 a month for a 1,300-square foot house. In some cases, insurance companies paid very high rents to obtain temporary housing for insured clients who lost their housing.

Affordable housing for farm workers is also an issue in Salinas; the Fair Market Rent for a two-bedroom apartment in Monterey county was $1,400 a month in 2017. Many farm workers live in converted garages, backyard sheds and other structures with no postal address: a third of children in the Salinas City Elementary School District have no postal address.

Some Salinas-area vegetable growers are building housing for farm workers. Tanimura & Antle opened in 2016 a $17 million, 800-bed farm worker housing complex in Spreckels. The Nunes Company plans a $20 million 600-bed complex along Boronda Road in North Salinas.

The median price of homes in California is over $500,000, more than twice the median price of US homes. In the Bay Area, most neighborhoods have single family homes, and they resist high-density housing. New state laws effective in 2018 aim to make it easier to overcome local opposition to additional housing in cities that have fallen behind in meeting housing goals.

California's 1982 Housing Accountability Act forbids cities from stopping developments that meet local zoning codes. Most developers do not sue cities for fear that winning their approval for new housing will become more difficult. Some activists have begun suing cities that deny developers permits for new housing, and some courts are overturning city councils, requiring them to issue permits to developers. Another bill requires cities that lose suits over housing to pay the legal costs of the winning side, raising the stakes for cities that deny permits to developers.

More than half of California renters pay rent that is more than 30 percent of their gross income, and 30 percent devote more than half of their income to rent. Rents have been rising faster than the incomes of those who rent, many of whom are young people and families with low earnings.

Many studies document the breakdown of the link between rapid economic growth and population growth in major cities, noting that San Jose and San Francisco are not adding residents despite high and rising incomes. Most studies conclude that restrictions on building additional housing mean that economic booms translate into higher housing prices rather than more people. Immigrants willing to accept crowded housing continue to move into high-growth cities, but US-born residents are leaving San Francisco and San Jose for lower-cost suburban housing.

San Francisco's 61-story Salesforce Tower, which opened in January 2018, is the tallest building west of the Mississippi river. Salesforce, which makes software linking businesses with their customers, is poised to surpass Wells Fargo as the largest private employer in San Francisco. In 1890, the owner of the San Francisco Chronicle, M. H. de Young, erected a 10-story building for the paper, then the tallest building west of the Mississippi; deYoung's tower was soon eclipsed by an 18-story building to house the Call newspaper owned by the Spreckels family.

Education. Fresno Unified is California's fourth largest school district. About 10 percent of the 73,000 K-12 students and 60 percent of the 10,000 teachers are white. Across the US, about 80 percent of teachers are white.

Law. Some California cities contract with law firms to prosecute low-level violations, such as modifying homes without building permits or failure to mow lawns. The law firm Silver & Wright prosecuted minor infractions in Coachella, and billed a homeowner who expanded his home without a permit $31,000 in addition to fines of $1,900.

Nuisance property abatement cases are considered too minor for the elected district attorney, and are normally handled by letters and fines. Those who do not respond can be prosecuted in civil or criminal cases. Coachella's law firm, Silver & Wright, took those who failed to respond to city inspection notices to criminal court, where judges often levy fines. Silver & Wright, representing the city, then bills the guilty party for its services.

Silver & Wright help other cities to deal with low-level nuisance offenses. The fact that some cities use private firms who send those who plead guilty to low-level offenses huge bills for their own prosecution that can result in limited-English speaking residents losing their homes has led to pushback, with some homeowners billed by Silver & Wright challenging their high fees.