How the Federal Government Zoned America

Introduction

Zoning has had an unmistakable impact on the American built environment. In requiring standards for the density, bulk, and use of buildings, zoning has an effect on everything from concentration of population, to distance between uses and commute times, to the supply and affordability of residences, business, and industrial property. That this body of regulation could be so consequential is the very reason for its existence. Seymour Toll chronicled in 1969 the revelation of New York’s 1913 Heights of Buildings Commission: “The composite of possibilities for the skyscraper and every other city structure was the zoning envelope. The design of the zoning envelope was the meat and drink of urban planning.” ¹ Because zoning is usually determined at the local level, it is often assumed to reflect local market or community values. It is very significant then, that federal policy has had an impact on zoning. It has done so perhaps most explicitly through the Federal Housing Administration (FHA), and in a way that has biased the marketplace toward the production of an urban form marked by the simultaneous sprawling and segregation of single-use areas. This is not to imply that there has been a nefarious conspiracy against denser, arguably more efficient uses of land; the FHA’s actions did in fact represent social engineering of a popularly desirable sort. ² It also however does not necessarily follow that because the FHA was a public agency, it did not extol its own “private values”; ³ critics of American zoning practices long have argued that given the choice, developers “would have chosen to develop their tracts at higher densities, had they been free to do so.” ⁴ And it certainly complicates the assertion that the United States has never had a federally managed land-use program. Certainly, however, the single-family home was popularly desirable; the 1931 President’s Conference on Home Building and Home Ownership wrote: “The one-family dwelling should be used as the ideal since zoning statistics show that between 70 and 85 per cent of our total population desires that type of home.” ⁵ What is most significant about this story then is that the federal government has taken a consistent position in providing a type of urbanization with profound implications for American lifestyles and planning, desired or not. This forces observers of past and present planning practice to question the power of local actors to determine the fate of their communities, and the perceived “market-drivenness” of suburban growth.

Most simply put, the FHA in the 1930s trusted the assumptions of urban economists of the day, Homer Hoyt most prominent among them, who detailed in their writings how social values translated into economic values. They codified these assumptions through standards for the mortgages on which they would provide insurance. Developers wanted to meet these standards so they could get the FHA insurance, essentially a subsidy as it removed much risk from lending. Local planners wanted FHA-insured development because it represented socially desirable and fiscally beneficial growth, and local legislators quickly saw their case, adjusting zoning accordingly. This had long-term impacts beyond development directly backed by the FHA because the FHA set the tone for safe practices throughout the private sector and because FHA-inspired zoning guided non-FHA-financed developments as well.

This is an underinvestigated corner of American urban history. Most are familiar with the FHA’s sponsorship of homeownership as a reason for suburbia’s expansion, but not necessarily with why expanded homeownership was almost exclusively manifested in low-density, use-segregated form. Some authors have notably explored the impact of FHA preferences on local policy, although not exclusively or comprehensively in terms of zoning.

Kenneth Jackson (1987) revealed the maps with which the Home Owners Loan Corporation (HOLC) graded neighborhoods from “best” to “hazardous” and cautioned lenders against making loans in areas of older construction, mixed use, and importantly minorities. This bias was passed on to the FHA, which through its underwriting manuals encouraged private lenders to eschew business in minority areas. However, Jackson did not address the reaction of cities to FHA practices in their zoning policies. Amy Hillier (2005) similarly pointed out the impact of race and immigration status on HOLC maps in Philadelphia, although the reaction of the city of Philadelphia to the federal condemnation of its neighborhoods and their residents was beyond the scope of her paper. Eran Ben-Joseph’s The Code of the City (2005) does cover some aspects of the FHA’s influence on zoning, especially in its discussion of the FHA’s neighborhood standards. ⁶ These he notes required uniform yards around buildings, a significant contributor to realizing a suburban form, but he did not present an evaluation of the FHA and local zoning beyond this finding. Oliver Gillham, in The Limitless City (2002) also noted the FHA’s tendency to perceive wide streets with homes set back on large lots as desirable and pedestrian-scaled neighborhoods as undesirable in its lending practices. ⁷ Michael Southworth and Ben-Joseph, in “Street Standards and the Shaping of Suburbia” (1995) ⁸ described an era of the “Institutionalization of Standards” initiated by the 1931 President’s Conference on Home Building and Home Ownership, in which the FHA promoted standardized subdivision requirements and zoning. Marc A. Weiss, in The Rise of the Community Builders (1987), investigated the impact of FHA policy on zoning in California cities. Weiss presented evidence that the FHA’s vision was in line with that of planners and large-scale developers of the time, and that this vision was delivered when cities imposed zoning restrictions that guaranteed safe environments for FHA investments.

This paper will build on the work of these authors by further investigating how the FHA impacted zoning policy, using the city of Los Angeles as a case study. It will argue that the FHA, by offering a financing option for products much in demand, persuaded cities to adjust their zoning according to federal standards. The FHA provided a convincing case that zoning for lower-density residential uses and preserving them was the best way to accommodate the huge market of hopeful homeowners eager to acquire FHA-backed mortgages. ⁹ Eran Ben-Joseph in The Code of the City pointed out that “the federal government was able to exercise tremendous authority and power through the simple act of making an offer that could not be realistically refused.” ¹⁰ This was significant because it greatly expanded the pattern of suburban development that defined the early postwar years. This paper will address the formative years of this trend, from the advent of the FHA in 1934 through the 1940s.

The FHA and Zoning

Zoning became widespread in the United States in the 1920s and the Supreme Court ensured its legitimacy in 1926 with Ambler v. Euclid. Real estate developers and economists supported zoning because it promoted property values, and planners looked to the elevation of property values as promoting the proliferation of socially homogeneous, desirable developments in their communities. Community developer J. C. Nichols of Kansas City presented a persuasive case for zoning, arguing: “if . . . we can limit the quantity of certain classes of property, if we can create the feeling that we have a monopoly on that class of property . . . we are assisting in the sale of that property.” ¹¹ When the FHA came on the scene in 1934, its mandate to expand homeownership in risk-averse fashion was therefore bound to simultaneously be involved in promoting property values and the zoning for homogeneity that this entailed. The involved financial mechanisms were direct loans and the insurance of twenty-year amortized mortgages; previously most mortgage policies only lasted a few years and required at least a 50 percent loan-to-value ratio. According to one critic, the high loan-to-value ratio mortgage as a standard home financing instrument was the “most important contribution of the FHA.” ¹² “The FHA” was “in essence, a government created and controlled insurance company functioning to insure certain kinds of loans made by private lenders, which are deemed to be socially or economically desirable.” ¹³ By the end of the Depression, the federal government guaranteed nearly 25 percent of the country’s total residential mortgage debt. ¹⁴

The FHA, despite this immense investment, was—at least in its early years—patently a conservative institution. It did not want to saddle taxpayers with the burden of bailing out lenders who, finding security in government backing, may rush into granting mortgages only to end up with foreclosed homes on their hands. In exchange for insurance protection the FHA therefore imposed various conditions on candidate properties. ¹⁵ Among these were standards for construction, numbers of rooms and occupants, and significantly neighborhood standards. The FHA was very cautious in its definition of safe investment areas. In determining neighborhoods worthy of investment, it assumed the inherent volatility of mixed-use blocks and the economic stability of the socially and physically homogeneous single-family district. A good score from the FHA therefore depended on the separation of uses. The FHA also incorporated social characteristics into its evaluations such as the presence of minorities, this being in line with the norms of the day. ¹⁶ Writing on the Home Owner’s Loan Corporation (HOLC), the intellectual predecessor of the FHA, Amy Hillier found that race and immigrant status impacted HOLC’s determination of high-risk areas, even when controlling for value and condition of housing. ¹⁷

The FHA’s reasoning, derived largely from the work of eminent land economist and FHA Principal Housing Economist Homer Hoyt, was that “the qualities which produce a satisfactory social condition also tend to assure economic soundness,” and that dwellings should therefore be “convenient and efficient in arrangement, attractive in appearance, and appropriate in their neighborhood setting.” ¹⁸ The FHA trusted Hoyt and codified his assumptions through standards for the mortgages on which they would provide insurance. A “sound loan,” wrote the FHA “must be secured adequately by a dwelling the value of which will reasonably protect the gradually diminishing outstanding principal, with a fair margin of safety.” ¹⁹ It followed that “dwellings shall be only in neighborhoods which possess, in considerable degree, security from those disintegrating influences which are more certain to destroy property values than defects in the buildings themselves.” ²⁰ Such influences included minorities, commercial properties, and if single-family dwellings, apartments. Thus cultural values and prejudicial judgments, interpreted by economists such as Hoyt as indicative of scientific phenomena, became federal policy—the transient, the vague, the sublime, and complex arena of market valuation was finally repackaged as a set of rules to be followed in zoning and other policies. The subjective was now objective knowledge.

The FHA, with Hoyt as principal author, developed the report “The Structure and Growth of Residential Neighborhoods in American Cities” (1939) to demonstrate a method for determining risk of investment in urban areas. ²¹ “If the value of a single home is affected by the condition, type and value of surrounding homes,” the report concluded, “then it is of the most importance to the mortgage lender that patterns of residential areas be prepared, showing the relationship of sections of different types to each other.” ²² In other words, residential areas were to be homogeneous in their contents, consisting wholly of apartments or single-family homes but never mixing them together.

Restrictions against denser development in single-family districts were nothing new, and today they seem only natural. Until the 1870s, the only form of multifamily housing in the United States was the tenement, and to this form of housing critics attributed a host of problems, including disease, drunkenness, and crime. ²³ After 1870, wealthier families in New York City began to reside in multifamily housing, which they preferred to distinguish from tenements by calling them apartments or even “French Flats.” Reformers adopted the view that multifamily housing was an evil per se. ²⁴ Still, however, if the popular ideal of single-family homeownership was to be promoted, multifamily construction would need to be excluded: apartments or not, multifamily development represented the potential to drag single-family housing down in value and stature. ²⁵ In Miller v. Board of Public Works (1925), the Supreme Court of California ruled in favor of the city of Los Angeles in its denial of a permit allowing George Lee Miller to construct a four-flat building in a single-family zone. ²⁶ This case validated Los Angeles’s single-family zoning, with the court praising single-family zoning for upholding “the civic and social values of the American home”:

We think it may be safely and sensibly said that justification for residential zoning may, in the last analysis, be rested upon the protection of the civic and social values of the American home. The establishment of such districts is for the general welfare because it tends to promote and perpetuate the American home. It is axiomatic that the welfare, and indeed the very existence, of a nation depends upon the character and caliber of its citizenry. The character and quality of manhood and womanhood are to a large measure the result of home environment. The home and its intrinsic influences are the very foundation of good citizenship, and any factor contributing to the establishment of homes and the fostering of home life doubtless tends to the enhancement not only of community life but of the life of the nation as a whole. . . . With ownership of one’s home comes recognition of the individual’s responsibility for his share in safeguarding of the welfare of the community and increased pride in personal achievement which must come from personal participation in projects looking toward community betterment. . . . The general welfare of a community is but the aggregate welfare of its constituent members, and that which tends to promote the welfare of the individual members of society cannot fail to benefit society as a whole. ²⁷

In Euclid v. Ambler (1926) the United States Supreme Court found that apartments may be “parasites” and “come very near to being nuisances.” ²⁸ In fact the FHA’s standards were in a long line of building and zoning codes that somewhat disingenuously promoted safety as a mechanism for suppressing density. In “The Anti-Apartment Movement in the US and the Role of Land Use Regulations in Creating Housing Segregation,” Kenneth Baar noted the somewhat devious nature of fire codes in much of the country, quoting the National Housing Association Proceedings of 1913: “If we require multiple dwellings to be fireproof, and thus increase the cost of construction; if we require stairs to be fireproofed, even where there are only three families; if we require fire-escapes and a host of other things, all dealing with fire protection, we are on safe grounds.” ²⁹ By the 1930s, the regulatory focus was on providing space between buildings and enforcing homogeneity, practices vital to the realization of the use-segregation and spaciousness of American suburbia. The 1931 “President’s Conference on Home Building and Home Ownership” advised that zoning should “provide adequate private yards for each type of district” and “encourage the development of neighborhoods with such uniformity of type of dwelling as will secure the best social and economic conditions.” ³⁰ By the later twentieth century, restrictions against density were such that in the Boston area, twenty-one of sixty-four cities permitted no apartments, three only subsidized apartments for the elderly, and nine only at densities of fewer than fifteen units per acre. ³¹

The FHA ensured that the low-density stuff of planners’ and large developers’ dreams would become a reality in the postwar boom. The FHA, in theory, was a strong supporter of the “Neighborhood Unit” paradigm, a design prototype most famously outlined by New York planner Clarence Perry. For decades, theorists who regarded the big city as an alienating, demoralizing and corrupting place had espoused the value of small, self-sufficient, contained communities centered on civic institutions and public spaces. In the city, wrote Louis Wirth, “bonds of kinship, of neighborliness, and the sentiments arising out of living together for generations under a common folk tradition are likely to be absent.” ³² In community design schemes such as that of Clarence Perry, single-family homes were to be protected on quiet interior streets, with commercial activities and apartments clustered at the community’s edges along major arterials. ³³ The FHA described a desirable community as: “A group of properties devoted predominantly to residential use and associated with properties devoted to other, nonagricultural purposes—such as commercial, industrial, educational, recreational or religious uses—the whole being provided with a system of streets, served by certain common utilities and services, indentified by a name, and presenting a concentration of population, buildings and enterprise.” ³⁴ Likewise: “The neighborhood shall be accessible to suitable employment areas, market centers, and schools. Adequate and convenient facilities for transportation, at reasonable cost, shall be available.” ³⁵ However, the FHA seemed to compromise its own idealization when it wrote:

The neighborhood shall be homogenous in character and shall offer reasonable security against decline in desirability for residential purposes due to encroachment of inharmonious land uses, such as commercial or industrial occupancies. The presence of, or the imminent danger of, the intrusion of buildings or land uses detrimental to residential neighborhoods; the presence of objectionable smoke, odor, noise, unsightly features, or similar nuisance, or the absence of appropriately drawn and adequately enforced zoning regulations or private restrictions, when constituting unquestionable major hazards, shall be deemed sufficient cause for rejection of an application. ³⁶

Certainly any mixing of residential types was out of the question: “A bungalow surrounded by apartment buildings, or an apartment building in a neighborhood of detached houses . . . would be a questionable risk. . . . Under average conditions, a twenty-thousand dollar house in a five-thousand dollar neighborhood would be doubtful security for a mortgage loan.” ³⁷

Critics were not mute; Harvard Professor of Regional Planning, Reginald Isaacs, wrote: “Proponents of the concept are convinced that it is possible to import the physical and social amenities of the countryside and small town into the city.” ³⁸ Isaacs wrote in 1948: “the ‘flight from the farm’ also had incentives other than loss of economic opportunity—new contacts, economic opportunity, anonymity and personal freedom. . . . Ignoring such evidence, planners maintain that the concept is possible of achievement and have in the last twenty or more years, planned and built what they purport to be neighborhoods. . . . [A]spirations to produce the social relationships of the unplanned countryside by utilizing the neighborhood as a planning formula in the city not only illustrate a sense of morbid sentimentality but would result in failure.” ³⁹ Furthermore, the variety of neighborhood planning preferred by the FHA, essentially one of homogeneity, was according to Isaacs segregationist and antidemocratic. “Planning” he wrote “must be brought into accord with the processes of growth of the city as a living organism, the character of its social life and population composition and in the light of greater effort toward democraticization.” ⁴⁰ This of course did not square with the evolving “science” of the day. Looking back, in 1966 land use law expert Richard Batke concluded that the impact of the FHA was in its contribution “to both home ownership and urban sprawl.” ⁴¹

The FHA overwhelmingly denied mortgages in areas of older construction, minority areas, areas that were not zoned, and areas where the incorporation or proximity of less restrictive zoning even mildly threatened investments in low-density residential construction. The FHA could therefore suppress development where it did not want to see it. Direct FHA intervention in local zoning and development matters was not limited to the early decades that are the focus of this paper. In the 1970s academic and government official Marion Clawson noted: “In Fairfax County, for instance, FHA refused to approve loans in the area directly affected by flight patterns from Dulles International Airport. While it might have been possible for some builder to build, sell, and finance the construction of homes from his own resources, in practice the position of the federal government was effective in largely preventing home construction in this area.” ⁴² Early on the FHA established a Technical Section to oversee the enforcement of “uniformity to city plan” and zoning for properties receiving insured mortgages. ⁴³ Seward Mott, the FHA’s land planning director stated at the 1938 NAREB conference, “We examine the effectiveness of the zoning ordinance. For instance, just because there is a zoning ordinance does not necessarily mean that it gives full protection. It may be subject to political pressure. . . . Each situation is to be investigated separately.” ⁴⁴ The FHA furthermore required that “whenever a local requirement contains a more stringent provision than any of the requirements stated herein, such local requirement shall in that case apply.” ⁴⁵

In 1939 the FHA formed a Land Planning Unit within its Technical Section to supervise subdivision and to implement standards “for new areas in which requests for insured loans had been received.” ⁴⁶ Zoning was a significant arena for evaluation. ⁴⁷ When zoning did not meet FHA standards, correction was sought:

In one small town in up-State New York, loans in a new subdivision were not approved because of the lack of a zoning ordinance and the consequent danger of industrial encroachment. . . . In another small city in central New York, the Federal Housing Administration was unable to insure maximum loans in many neighborhoods because of deficiencies in the zoning ordinance. Home owners and developers felt that because they had a zoning ordinance, maximum loans were warranted. The weaknesses of the ordinance were explained in detail, and it was recommended that the community retain an experienced consultant to aid in correcting its ordinances. ⁴⁸

In 1940, 80 percent of all subdivisions developed under FHA supervision were restricted to single-family construction at an average of 3.26 units to an acre. ⁴⁹ In 1936, 95 percent of mortgages insured by the FHA were for single-family residences, and during the last six months of that year 40 percent of all single-family construction in the country was funded by the FHA. ⁵⁰ In the 1950s, FHA-insured loans for single-family homes exceeded FHA-insured loans for multifamily homes by a ratio of seven to one. ⁵¹ The share of privately financed nonfarm dwelling units started under FHA programs compared with total U.S. housing starts increased from 6.5 percent in 1935 steadily to peak at 79.6 percent in 1943, dropped dramatically to 6.8 percent in 1946, then increased back to a peak of 25.5 percent in 1950, and then hovered between a low of 14.3 percent and a high of 22.5 percent for the remainder of the 1950s. ⁵²

Did the declining share of American housing financed under FHA programs mean its influence over development standards waned? On the contrary, the FHA’s standards quickly became every lender’s standards. In the 1960s, long after the FHA’s direct contribution to home financing had waned, Clawson noted: “One successful private builder has stated . . . that all his homes must meet Federal Housing Administration standards for loans, even though he has arranged his financing without FHA help, simply because it is too difficult to sell houses which do not have or cannot get FHA loan approval. Thus the federal standards have tended to become standards for the whole industry, in spite of the fact that FHA loans have financed only about 16 percent of home building.” ⁵³

It was not only the single-family type that was bolstered by FHA intervention, but its segregation from other uses. Lots in commercial areas, or lots proximate to commercial areas, were early on removed from consideration for financing. In Houston, where there has not been zoning, if there was any question about the use of property abutting single-family homes, the developer may be required by the lender to purchase a restrictive covenant for that property. ⁵⁴ The FHA wrote in 1939 of its impact: “Revision of zoning ordinances of many cities to reduce the proportion of commercially zoned property in favor of larger residential areas is receiving more consideration in nearly every part of the country.” ⁵⁵ The FHA was encouraged by a noted “unwillingness of lending institutions to advance mortgage money for the purchase or construction of homes located in areas zoned for commercial use. This attitude has been fostered by the FHA’s underwriting practice, which attaches great weight to hazards to residential investment resulting from this condition.” ⁵⁶ Certainly within buildings the mixing of uses was questionable: “Generally speaking, mixed use has proven to be an extremely hazardous factor in mortgage lending and should not be looked upon favorably from that point of view. From the social point of view, dwellings in combination with business properties are usually far from satisfactory.” ⁵⁷

In addition to the mixing of uses, the FHA targeted the appearance of uses, preferring a suburban aesthetic characterized by wide setbacks and lower lot coverage, and usually favoring a lower maximum lot coverage than local ordinances. ⁵⁸ The FHA took “notice of the trend in modern housing toward lower land coverage for both single and multiple family dwellings and wishes to endorse and promote that trend.” ⁵⁹ The FHA preferred that lot coverage not exceed 30 percent of the net area of an interior lot or 40 percent of the net area of a corner lot. ⁶⁰ Multifamily buildings, the Conference decided, should cover between 30 and 50 percent of the lot. ⁶¹ Land coverage in single-family districts should not exceed a quarter of the lot. ⁶² Lot width, in order to accommodate building coverage, light and air requirements, should exceed at least fifty feet, twice as wide as the standard urban lot. ⁶³ The FHA mandated that a dwelling should be located on its lot so that no wall of the principal building was at any point less than fifty feet from the building line on the opposite side of a street, less than fifteen feet from a rear lot line, or less than three feet from a side lot line unless the dwelling was built to the lot line. ⁶⁴

The FHA also discouraged experimentation in design saying, “Distinction shall be made between passing fads and definite trends in taste. . . . Preferential consideration will be given to designs which are simple and direct, which . . . avoid straining for picturesque or unusual effects through elaboration of motif or ornament.” ⁶⁵ It even discouraged such experimentation in design that may someday aid in the more efficient use of resources: “Materials, equipment, and methods of construction in general use in any locality are acceptable for dwellings eligible for mortgage insurance in that locality, providing their durability and suitability for their intended purpose have been demonstrated by experience.” ⁶⁶

The most successful of all FHA programs in terms of number of units produced was its financing of single-family residences under section 203 of 1934’s National Housing Act. Between 1935 and 1964, a total of 218,985 multifamily units were built with FHA financing under Section 207 of the National Housing Act, compared to 6,406,564 single-family homes under Section 203 in the same period. ⁶⁷ The 1942 Housing Act introduced Section 608 for the production of multifamily units. Section 608 in a three-year period produced more than twice the number of multi-family units produced under Section 207 within twenty-nine years. ⁶⁸ However, the construction of Section 608 housing was ridden with unlawful practices: a Committee on Banking and Currency found that 437 out of 543 investigated projects had mortgages exceeding the cost of the project by an average of 12.7 percent. ⁶⁹ Furthermore, Section 608 projects were not available for ownership; ownership of FHA-financed apartments was not possible until 1961 under Section 234. ⁷⁰

Multifamily construction declined to 7 percent of construction between 1946 and 1956 as the private sector adjusted to the booming FHA-driven market for single-family homes. ⁷¹ When the FHA did fund multifamily development, it was limited to persons of low income, ensuring the segregation of the poor to projects where their assumed bad habits may not affect values of middle-income, single-family construction. ⁷² In Houston, the segregation of multifamily garden apartments was effectively achieved when the FHA limited their financing for multifamily construction to existing lower-income areas. ⁷³ Taken together, the FHA’s policies contributed to the decline and ghettoization of areas unsatisfactorily zoned, dominated by mixed use, or minorities, and encouraged the flow of most new investment into areas of homogeneous single-family construction of limited density and some inconvenience to other uses. The particulars of these policies in regards to land use are further revealed in the following study of Los Angeles.

The Los Angeles Case

In this section, I will explain how the FHA influenced local zoning practices in the city of Los Angeles. The Los Angeles City Council established a city Planning Commission of fifty-one members in March 1920. ⁷⁴ Of the forty members who described themselves as a representative of some professional or recreational association, twenty-one were from business associations, reflecting the role of business interests, in particular the real estate industry, in bringing zoning to the city. ⁷⁵ While altruistically motivated reformers perceived zoning as a route to greater public health and civic beautification, powerful real estate developers saw it here as elsewhere as a means to developing supply constraints that would cut out smaller competition and elevate the value of their investments. Planners favored community design schemes that in limiting intensive uses and sheltering single-family homes neatly dovetailed with realtors’ ambitions, looking to schemes such as that of New York’s Clarence Perry. ⁷⁶ Here, single-family homes were to be protected on quiet interior streets, with commercial activities and apartments clustered at the community’s edges along major arterials. ⁷⁷ Likewise, planners in Los Angeles were determined to zone arterials predominantly for multifamily use, with commercial uses located in clusters at major intersections, and interior streets reserved for single-family residences and public facilities. ⁷⁸

Los Angeles in the 1920s was overzoned; that is, it was zoned for a greater population and amount of commercial space than could realistically be expected. This had occurred in spite of the preferences of planners and big developers for more stringent regulations. In zoning the city, the City Planning Commission made it customary to engage the wider public. ⁷⁹ The careful containment of commercial and multifamily residential uses proved problematic over the course of public engagement: more restrictive, namely residential, zoning categories were hardly beneficial designations from the perspective of speculating small-scale landowners whose profits depended on getting the most out of their limited resources. As the City Council took into consideration popular demand for less restrictive land use designations, and as money changed hands, communities became zoned for more intensive uses than called for in planners’ visions. District Attorney Buron Fitts called the Council’s oversight of zoning a “racket” that “eclipses any other form of asserted corruption yet brought to our attention.” ⁸⁰ The hands of the Planning Commission—downsized to a more reasonable five members and served by a professional department under former commission secretary Gordon Whitnall from 1925 ⁸¹ —were however for the most part tied. It remained reserved in its criticism, saying “the City Council was naturally subjected to those influences to which an elected body falls err” (see Figure 1). ⁸²

OPEN IN VIEWER

Figure 1.

Zoning, pre-FHA. The disaster that was zoning during the “racket” of the 1920s. Commercial strips, indicated by the darker shading, instead of commercial centers.

It is hardly surprising that the City Planning Commission celebrated the arrival of the FHA’s 1935 “Property Standards” for the approval of mortgage insurance, calling them “splendid.” The FHA essentially gave the planners and their allies on the Real Estate Board the platform they needed to zone the city as they wanted. “Their requirements,” the Commission wrote, “have made property owners more zoning conscious than ever before, and the interest which property owners have displayed in proper zoning and re-zoning is most encouraging.” ⁸³ The FHA’s preference for large uniform districts of low-density residential use made regulators take immediate notice. ⁸⁴ The issue was simply that, because of the FHA, “the planning of a few years ago, is not something they should have today.” ⁸⁵ The overinflation of value by overzoning would clearly need to be eliminated. In order to bring a wider public over to its side in the fight against overzoning, the City Planning Commission set several strategies, among them “publicity through radio talks whenever possible looking toward educating property owners to the advisability of the change in zone which would result in lesser taxes and through development of the changed zone which could actually be used for that purpose.” The Commission was confident “that in this campaign of publicity and education . . . the Federal Housing Agencies desire for definite and positive zoning before loaning money for residential development would be a very convincing and conclusive instrument in the education of the public.” ⁸⁶ Already within one year of the FHA’s founding, requests were before the Los Angeles Planning Commission to zone unzoned areas of the city so that properties may receive FHA mortgage insurance. ⁸⁷

Former debates were quickly settled. The FHA delivered a stark warning to those proposing a repeal of its Yard Ordinance: get rid of yard requirements and Angelenos would need to install alternative protections, or perhaps forget about FHA help. ⁸⁸ Indeed the Yard Ordinance was responsible for a sizable amount of development by this time, a direct result of the FHA sponsoring development subject to the Ordinance’s regulations. ⁸⁹ The FHA had in fact made its entry into the Los Angeles building scene based on the adoption of the ordinance, wrote the Los Angeles Chamber of Commerce: “the fact is that since the effective date of the comprehensive Yard Ordinance the Federal Housing Administration has come very prominently into the picture of residential construction. . . . [T]he fact that the comprehensive Yard Ordinance requires a specified width of side yards permits the FHA to pass many loans which would be rejected.” ⁹⁰ Fred Marlow, Acting Regional Director of the FHA, and co-developer of the Westchester project discussed later in this article, stated: “the protection afforded home owners by this ordinance, in our opinion, is most beneficial and in fact is relied on to a great extent when loans are under consideration by this Administration for insurance under the National Housing Act. . . . If this ordinance were repealed, it would undoubtedly have a highly detrimental effect upon the ability of home owners to obtain legitimate mortgages on their homes.” ⁹¹ The Yard Ordinance quickly gained sponsors among the public, including the Veterans’ Welfare Board and remained uncompromised for decades. ⁹²

What were the requirements of the FHA and the zoning it sponsored? The Yard Ordinance effectively outlawed the row-house by requiring all residential development to have side yards. This was by no means unintended, the City Planning Commission having stated that without the Yard Ordinance “there is no regulation to prevent the development in sunny Los Angeles of the undesirable row houses so characteristic of densely populated Eastern cities . . . side yards should be required on both sides of every building used for human habitation and should be of sufficient width to admit adequate light and air based upon sunlight projection.” ⁹³ In requiring front and rear yards in addition, the Yard Ordinance also required residences to be set back from the front lot line and cover a smaller percentage of the property. In so doing, it effectively banned construction commonly associated with traditional urbanism: it eliminated the row-house building type, set buildings back from the street, and spread out development by requiring open space to surround buildings on all sides.

The FHA also encouraged zoning that strictly segregated uses. Los Angeles’s zoning was pyramidal; that is, its less stringent categories allowed all more restricted types of construction: a multifamily zone would allow single-family construction, a commercial zone multifamily and single-family construction, and so on. This was based on the assumed harmless nature of these more restricted uses to the less restricted uses, and also allowed the mixing of uses so vital to the pedestrian-friendly city. However, in its disapproval of mixed-use construction, vertically in the same building or horizontally across different lots, the FHA sought to compromise pyramidal zoning, encouraging as it was of a mixing of uses. Certainly the lack of zoning, even on deed restricted properties, was grounds for refusal of FHA financing. ⁹⁴ The FHA definitely frowned upon lots zoned for industrial operations, or proximate to lots zoned for industrial operations. ⁹⁵ The City Planning Commission stated of one industrially zoned property, “unless some adjustment is made, FHA loans are not available to owners who desire aid in financing their homes.” ⁹⁶

Property owners could not receive FHA loans for residential construction on commercially zoned lots. ⁹⁷ Of the zoning in the city’s San Pedro district, one Planning Commissioner stated that the “uneconomic condition of the property zoned for business . . . hurts the individual owner and hurts the community as a whole and we have found that this situation has retarded the development in San Pedro greatly during the past few years particularly since the Federal Housing Administration has come into the picture because through their application of high property standards, they insist upon proper zoning protection for insured loans and . . . limit insured mortgage loans on property zoned for business, or industrial, because of the hazard that exists . . . and because of the high percentage of property now zoned for business and light industrial, it has been impossible to get FHA loans for the type of development that should take place.” ⁹⁸ Nor did the FHA allow loans for residential construction on residentially zoned lots in proximity to commercially zoned lots. ⁹⁹ Lots of insubstantial width (under fifty feet it seems) were also shunned by the FHA, a policy guaranteeing greater distance between buildings. ¹⁰⁰

The difference between receiving and not receiving an FHA loan or mortgage insurance, and therefore the difference between the correct and incorrect zoning, was nothing less than the inability to build; the granting of an application for a zoning designation ruining the residential character of an area would simply “mean that the property owners in that area are going to be penalized by being unable to obtain FHA loans.” ¹⁰¹ Not only was a residential designation necessary, but a single-family designation often necessary to receive standard FHA financing, single-family zoning being “of extreme benefit in securing” federal loans. ¹⁰² Even the construction of a duplex or two houses on a lot could endanger the securing of FHA financing under Section 203 on an adjacent property. ¹⁰³ On the edges of the city, in areas previously zoned for agriculture, the predominant trend was to zone for single-family development, ensuring the realization of suburban development at the fringe. ¹⁰⁴ Here property owners were coming to the realization that zoning for low-density residential use was really the only available avenue if they hoped to stimulate construction. ¹⁰⁵

FHA financing was available for multifamily projects through its Section 608 program. The same standard was not held to these properties in terms of their proximity to commercial property; indeed the FHA encouraged the consideration of multifamily construction and commercial properties as complimentary, not conflicting, uses. ¹⁰⁶ The securing of financing under Title 608 in fact required the construction of retail facilities in proximity. ¹⁰⁷ It does not however seem that apartment properties could be built facing commercial properties. ¹⁰⁸ In any case, apartment construction under Section 608 did remain a relative rarity compared to FHA-insured single family construction. ¹⁰⁹ In fact, the City Planning Commission stated in 1947 that Los Angeles County remained “way down the national list in regard to the number of rental units authorized under FHA Title VI, Section 608, the most liberal financing legislation yet devised to encourage large rental construction.” ¹¹⁰

The landowning public, although it did eventually buy into the FHA’s scheme for suburbanization en masse, did not always go along easily with the zoning required to support the scheme. There were the usual concerns of having paid a higher price for the property in question, or having paid higher taxes, to which the Planning Commission responded that property owners would ultimately thank them for granting greater protections. ¹¹¹ Certainly speculating landowners attached to a more lenient zoning designation did not see the reason why “the Housing men stated there will be too much business.” ¹¹² These individuals often felt themselves to be in the majority on zoning cases surrounding the issue of FHA loans. ¹¹³ They considered the securing of a federal loan to be a “selfish” purpose that may endanger commercial zoning on adjacent parcels. ¹¹⁴ However, even the FHA’s rejection of financing for home construction was not enough for the City Planning Commission to allow a commercial designation on property it considered suitable for less intense development. ¹¹⁵

In 1935, the city conducted a property survey of the central one-hundred square miles of Los Angeles with funding from the Civil Works Administration (CWA) and concluded that its zoning was not up to par with FHA standards. ¹¹⁶ The petitioners for stricter zoning were usually property owners, although the Board did take it on its own initiative to rezone many areas of the city, saying in one case: “with the zoning as it exists at the present time they are unable to procure FHA aid in making developments because the Government in making the loans must be assured that the zoning does not permit the erection of businesses and buildings which will be of detriment to residential development.” ¹¹⁷

FHA regulations thus brought the public over to the Planning Commission’s side in its efforts. ¹¹⁸ Change was slow at first: from 1936 to 1938 the council moved 14.3 miles of street frontage from multifamily designations into the single-family R-1 zone, 6.4 from business designations to residential ones, and 1.82 miles of frontage from industrial designations to various less intense ones. In total in this period, 25 miles of frontage was shifted to more restrictive designations versus 0.6 miles to less restrictive ones. ¹¹⁹ The Commission called it “a noticeable trend . . . in connection with rezoning property to a more restrictive classification.” ¹²⁰ By the end of the decade, it was the policy of the Commission to initiate zone changes that redesignated commercial and industrial properties as residential. ¹²¹ In 1941, the Planning Commission wrote: “It has been the policy of this Board to institute on its own initiative proceedings for a change of zone to a lighter zone.” ¹²² The task would continue unabated for decades. Federal policy of the 1930s seems to have brought an end to overzoning in many residential areas—at least on the scale seen in the 1920s—more than any other effort.

While in response to the postwar housing shortage, the City Council did ultimately pass an ordinance reducing setbacks, ¹²³ the general trend in the era was toward tighter restrictions. ¹²⁴ Large area-wide rezonings principally focused on downzoning: rezoning multifamily “R4” as two-family R-2 or single-family R-1 and accommodating commercial districts under the local commercial “C1” designations rather than general commercial “C2.” ¹²⁵ Municipal-level planning, federal standards, and the private housing industry together worked to build a city characterized by large expanses of single-use development. This aided the realization of multithousand-unit single-family developments by community developers such as Fritz Burns, contemporary cochair of the National Association of Real Estate Boards and head of the National Association of Home Builders, whose FHA-funded Westchester project in the southwest section of the city (developed in partnership with Fred Marlow, one-time Acting Regional Director of the FHA) was praised in the press as the largest and most spectacular feat of city building ever witnessed in Southern California. ¹²⁶

To understand how the FHA’s influence on local zoning manifested on the ground, it is useful to compare a model middle-class subdivision of the late 1920s with later post-Depression FHA underwritten products aimed at a similar market. Greg Hise’s Magnetic Los Angeles provides a thorough biography of these communities. On November 17, 1928, writes Hise, the greatest luminaries of Los Angeles planning assembled for the dedication of the first improved civic park ever granted to the city, Leimert Park, a feature of the multiuse Leimert Park subdivision. ¹²⁷ The Leimert Park community was a “planned subdivision for moderate-income buyers, with attributes, and amenities comparable to Beverly Hills.” ¹²⁸ It was Perry’s vision come to life, with residences zoned by type and arranged on the “appropriate corridors. Duplexes, fourplexes and six-flats lined the boulevards,” and interior streets were reserved for single-family housing. ¹²⁹ A commercial area surrounded the park at the southern end of the half-mile by three-quarter mile site, and was permeated by streets leading into the residential areas. Navigable by all personal transportation modes, multiuse, and intimate in scale, it remains an excellent embodiment of the vision of Perry, the Los Angeles planners saddled with overzoning, and indeed, today’s New Urbanists (see Figure 2).

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Figure 2.

A section of Leimert Park, still under development circa 1938, looking south. Intimate in scale, with the commercial area in the upper center of the photograph, multifamily construction along the radiating arterials, and single-family homes protected on interior streets.

Zoom thirteen years and post-FHA into the future and only a mile away to the subdivision of Windsor Hills. The developers of Windsor Hills were certainly not as concerned with civic betterment as had been the developer of Leimert Park, leaving out all the civic amenities called for by Perry, but they also left out any multifamily construction or commercial development beyond a few parcels. ¹³⁰ And again at Westchester, a few miles to the northwest, the Leimert Park model was obscured. The Los Angeles Daily News wrote: “You only have to visit Westchester to see the advantage of modern community planning over old-fashioned guesswork methods. In most old communities a hodge-podge of single-family, duplexes, apartments, and business properties are all mixed together.” ¹³¹ Leimert Park this was not, though nevertheless it was praised by the planners, being as it was devised under the firm rule of FHA guidelines and the home of thousands of middle-class taxpayers. Hise describes Westchester as “low-density and functionally exclusive.” ¹³² The boulevards are walled off from the residential lots backing up to them from interior streets, and the business district is buffered from the residential areas by parking lots and streets (see Figure 3).

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Figure 3.

The perverted neighborhood unit: Westchester in 1949. Bloated and dominated by vast sections of single-family use, Perry’s concept is lost.

At Panorama Ranch in the San Fernando Valley, the post-FHA pattern is apparent again. The commercial district is in a corner of the 430-acre site along Van Nuys Boulevard, buffered from the interior single-family area by parking areas and walls. Indeed this commercial district was not oriented to the adjacent community, but much more—it was a “regional shopping center.” ¹³³ Really Panorama City is two different, adjacent but buffered, products: a single-family residential area and a regional commercial center. While Hise prefers to point out the similarities between Westchester and Panorama City on the one hand and Leimert Park on the other, albeit noting the significant disparity in scale between the 1928 project and its 1940s counterparts, it is important to note all the differences. In the disappearance of multifamily options, in the sequestering of the commercial areas, in the magnification of scale and therein a loss of the pedestrian navigability stressed by Perry, the FHA enabled the mass-replication of neighborhood units but also mandated the perversion of the original vision. The San Fernando Valley and other suburban areas of Los Angeles are poorly replicated neighborhood units at best; they are as we all know composed of auto-oriented sprawl.

It is likely that the FHA’s preferences translated into long-lasting convictions among the homeowners and builders in how they wanted Los Angeles to look. Sprawling Los Angeles is a product of its zoning, and its zoning is a product of the FHA. It follows that the FHA is in part responsible for the desirable and undesirable products of the city’s built environment, the latter including auto-centricity, air pollution, and a build-out incapable of supplying housing for all those who demand it. Addressing these problems in Los Angeles requires the undoing of biases that otherwise may seem quite fruitful: the FHA’s preferences promoted suburban development, and when homeownership expanded, those preferences appeared justified. Just in the last decade, in the midst of a housing crisis decades in the making, is City Hall beginning to encourage the market to produce alternative products more suited for the contemporary needs of a still growing population. These include measures for development types that would have proven quite unsavory to the FHA in the 1930s, including adaptive reuse of commercial properties in downtown and the promotion of mixed-use developments on the city’s boulevards. ¹³⁴

Conclusion

For the past eighty years, most urban development has been suburban, this type being characterized by low densities, the dominance of the single-family home, and strict segregation of uses, all enforced by zoning requirements. Federal policy has had a hand in realizing this type of development in many ways, including most famously the Interstate Highway system and the FHA’s sponsorship of homeownership. However one underinvestigated arena has been the federal impact on local zoning ordinances: this was achieved through the FHA’s requirement of property standards for the reception of mortgage insurance. The institution of these standards were welcomed by developers, who saw them as a route to more secure building practices, planners who saw them as a delivery mechanism for the panaceas of ample light and air, property owners willing to sacrifice an otherwise preferable zoning designation to find buyers, and middle-class citizenry eager to gain home ownership. This was then a desirable engineering of the built environment, but not one without negative consequences. Homeowners’ groups became wholeheartedly dedicated to protecting the FHA’s definition of a secure investment. Alternative forms of development, mixed use or higher density, would prove unrealizable even when they have been demanded because of homeowner resistance to their intrusion and a marketplace biased toward the production of certain prototypes: the commercial strip mall, the single-family home, the garden apartment, and the big-box store. ¹³⁵ The FHA did eventually come around to supporting dense development in 1954, ¹³⁶ if only in the form of luxury tower-blocks replacing slums in redevelopment schemes, and the mixing of uses with Planned Unit Development in 1964. ¹³⁷ By then, however, the dominant pattern and its subsidization were set. The preferred type of suburbia has despite its popularity come with plenty of problems: auto-centricity, congestion, pollution, high energy consumption, social segregation, and exclusivity. While it was desirable, there is now ample evidence that a different kind of urbanism is increasingly in demand. ¹³⁸ Now may be the time for another round of social engineering: one that delivers a different kind of urbanism more suited for contemporary needs.