Abstract

Transit ridership in Los Angeles County has fallen
consistently over the past decade despite major investments
in public transportation. The reasons for this outcome vary,
but one likely culprit is the county’s built environment,
which is generally auto-oriented and low-density. Allowing
more, higher-density housing to be built near transit could
help increase transit ridership, but this solution faces two
obstacles. The first and largest obstacle is widespread
restrictions on multifamily development. The second, and
the focus of this brief, is the housing development process:
Even if new multifamily housing is allowed on a site, a
complicated, lengthy or unpredictable process could still
discourage its production.
Development processes are often categorized as “by-right,”
meaning developments are approved or not based on
whether they meet certain objective requirements, or as
“discretionary” — negotiated project-by-project in a back-
and-forth between city officials and builders.
Compared to discretionary processes, by-right processes
should in theory reduce the cost, delay, and uncertainty
associated with securing approvals, allowing homes to be
delivered more quickly and less expensively. It has been
difficult to test this hypothesis, however, because by-right
approvals are rare in cities where housing is in high demand
and are usually reserved for smaller projects.
The Transit Oriented Communities (TOC) density bonus
program, implemented in Los Angeles in 2017, changed the
city’s development process for certain projects, creating
a by-right approval pathway for many projects that would
have previously been discretionary, and streamlining
the entitlement process for many others that remained
discretionary. We take advantage of this program to measure
the impact of by-right and streamlined processes on project
approval times, with shorter times serving as a proxy for less
costly and potentially less risky housing development. For
each project, we determine the entitlement pathway, total
approval time, size, subsidy status, parking provided, certain
characteristics of the parcel, neighborhood characteristics
such as median household income and distance from the
central business district, and its location relative to the
TOC program boundaries. Using a multivariate analysis, we
compare approval times for each category, with and without
controls for many project and neighborhood characteristics.