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Bringing Diversity to the Suburbs

August 8, 2002

Bringing Diversity to the Suburbs


Advocates for the poor proclaimed a rare victory last week in their long campaign for more affordable housing in the suburbs. They hailed the latest court decision upholding New Jersey's so-called Mount Laurel doctrine, a set of rules designed to open suburbia to low-income families. But if past is prologue, the ruling by the New Jersey Supreme Court will mainly benefit builders of mid-priced and luxury homes.

For more than three decades, the court has tried to prevent New Jersey suburbs from using zoning laws to exclude the poor. The goal is admirable, and the court's legal solution has attracted national attention. But as other states and municipalities have learned, a judicial remedy is not the best tool for reforming housing markets. Instead, the lesson to be learned from New Jersey's experience is that the most effective way to enable low-income families to live in better communities is for government to directly subsidize the poor who rent housing.

The Mount Laurel doctrine began more than 30 years ago. In 1971, a group of low- and moderate-income families sued Mount Laurel, a growing suburban township in New Jersey, claiming that its zoning practices excluded them from the community in violation of the state constitution's provision requiring the state to "promote the general welfare."

In 1975, the State Supreme Court sided with the families. In an unprecedented decision that stunned the housing industry and government officials around the country, the court condemned land-use policies that discourage multifamily housing and ordered every developing community in the state to bear its "fair share" of housing for low- and moderate-income families. But it left the definition of "fair share" and other key issues unresolved, prompting an avalanche of lawsuits seeking to overturn local zoning, planning and environmental laws.

In 1983 the State Supreme Court prescribed a detailed set of rules for assigning specific "fair shares" to each community. Under the rules, communities must not only eliminate restrictive zoning but also offer developers inducements to build affordable housing. Most controversial was something called the "builder's remedy," which allows developers to sue to override local laws and construct more units of market-rate housing if they also build low-income housing.

By 1985, builders had challenged laws in about 140 communities. The legislature then reluctantly entered the fray, creating an agency to calculate the mandated fair shares. Communities that implemented their own plan for developing low-income housing would be immunized from further Mount Laurel litigation.

Sixteen years and many lawsuits later, this judicial campaign for affordable housing has done little for low-income families. Statewide, developers have built almost 15 times more market-rate units than affordable units — and most of the latter would probably have been built anyway. The affordable units, moreover, are disproportionately occupied by people of relatively high socioeconomic status, like graduate students, who happen to be at a low point in their earnings cycle. The market-rate units will eventually filter down to lower-income families in the normal housing cycle, but this takes time and does not target those who need the housing most.

This result is not surprising. Other states have attacked exclusionary zoning in a variety of other ways, also with little effect. The obstacles to affordable housing, especially in more prosperous suburbs, include factors like high land and construction costs. The Mount Laurel approach, with its focus on zoning litigation, addresses only one part of the problem.

An alternative strategy would be to reform outdated building codes and other regulatory barriers that raise housing construction and renovation costs (and encourage bribery) while producing few safety benefits. But the most direct and effective strategy to aid poor families is to give them housing vouchers that they can use to rent units in more desirable neighborhoods.

The federal Section 8 voucher program has been supported by both Democratic and Republican administrations. While no panacea — especially in markets with low vacancy rates — Section 8 and other renter subsidies enabled 1.4 million low-income families in 2000 to move from inner-city neighborhoods to better urban and suburban ones — and at a much lower cost than legal mandates.

The Mount Laurel approach is a throwback to a time when judges ordered top-down social change. Housing markets, however, are too complex and dynamic for courthouse engineering. A better approach to improving options for low-income families is to give them vouchers and help them find housing in places where they want to live.

Peter H. Schuck is a professor at Yale Law School and author of the forthcoming "Diversity in America: Keeping Government at a Safe Distance."

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