The SRU Law, twenty years later: evaluating the legacy of France’s most important social housing program

Abstract

Twenty years ago, in December 2000, the SRU Law (Loi Solidarité et Renouvellement Urbain) was passed in France, requiring selected municipalities to devote 25% of their local stock to social housing, in order to curb growing trends of segregation. Almost twenty years later, the balance is striking: still 1,222 municipalities targeted by the program do not comply with the set quota of 25% social housing units per municipality. Out of these non-complying municipalities, 269 had to pay an increased fee in 2017, based on the Article 55 clause included in the SRU Law. The total fee that these ‘outlaw municipalities’ had to pay for not providing enough social housing represented a total of € 77 million in 2017, and helped finance the national rental social housing fund for housing. In this paper, I ask what impact the Article 55 fee clause designed to enforce SRU Law objectives has had on the rebalancing of social housing stocks for municipalities not complying with set quotas. To answer such a question, I conduct a Difference-in-Differences study that measures changes in social housing stocks before and after the passage of the law. The treatment group comprises municipalities not complying with quota requirements and subject to the Article 55 fee, while the control group consists of municipalities not complying with quota requirements, but exempt from the fee. Findings underscore how after the passage of the Article 55 fee, municipalities that were subject to the fee have built less social housing than municipalities that are exempt, relative to before the enactment of the law. They corroborate my conceptual framework, which states that beyond the adoption of a national fee for noncompliant municipalities, social housing production trends are impacted by the types of land use ideologies in place in municipalities, be they pro-social housing or exclusionary. Twenty years later, these findings bring a new perspective to current debates taking place in policy circles around the effectiveness of one of France’s most important social housing policy programs.

Keywords:

• SRU Law
• inclusionary zoning
• social housing
• France
• exclusionary practices

Acknowledgements

The author would like to thank Stéphanie Jankel at the APUR Paris planning agency, Dr. Lance Freeman at Columbia University GSAPP, Dr. Wei Yin at the Columbia Data Services, Dr. Tyler Haupert at NYU Shanghai, Dr. Tristan-Pierre Maury at the EDHEC Economics research center, Henry Grabar at Slate and Dr. Valerie Stahl at San Diego State University for their valuable help developing this paper. She would also like to thank the three Housing Studies anonymous reviewers for their helpful comments during the revision process. This study benefited as well from feedback at the ACSP Annual Conference panel ‘Resistance & Concessions in Global Housing Markets’ (2018, Buffalo, NY).

Disclosure statement

No potential conflict of interest was reported by the author.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

1 There are three types of social housing unit categories: the ‘high-income ceiling’ category (PLS or Prêt Locatif Social), the ‘middle-income ceiling’ category (PLUS, Prêt Locatif à Usage Social), and the ‘low-income ceiling’ category (PLAI, Prêt Locatif Aidé d’Intégration).

2 The dataset Enquête sur le parc locatif social (EPLS) is a survey conducted with social housing developers, which was collected between 1987 and 2010 by the Service des données et études statistiques (SDES). It was replaced in 2011 by the Répertoire des logements locatifs des bailleurs sociaux (RPLS). Its goal is to collect data on the social housing stock by January 1 of each year (number of units, changes to the rental stock over the previous year, geographic location, occupation and vacancy rate, rental levels, financing and status).

3 The state and departments provide direct subsidies or indirect assistance to social housing developers through subsidized loans (CDC loans), or tax cuts (reduced rate VAT, property tax exemption, corporate tax exemption).

4 Social housing developers in charge of construction and maintenance can be public (OPH) or private (ESH, SEM).

5 In 1977, then-Prime Minister Raymond Barre initiated a reform from place-based social housing to targeted people-based programs, in parallel to a restructuring of the postwar welfare state model, in favor of a larger place given to the market. This time period was characterized by a decrease in social housing construction and an overall housing shortage crisis, until the government went back to a place-based model encouraging developers to contribute to housing construction in the early 1990s.

6 The initial target set in 2000 was 20% by year 2020. It was reevaluated in 2013, thanks to the Duflot reform, to 25% by 2025.

7 This law is comparable to other European programs in the United Kingdom or Germany. A similar program in the United States would be the Massachusetts Chapter 40B. Requirements involve both quantitative and qualitative goals since 2013, in that required units are a balance of a minimum 30% PLAI [Prêt Locatif Aidé d’Intégration] units for lowest-income households, and a maximum 30% PLS [Prêt Locatif Social] units for middle-income households who face difficulties renting market-rate units. The Article 55 fee was implemented on January 1, 2002.

8 In France, an Habitation à Loyer Modéré, or Housing at Moderate Rent, is a form of low-income housing. The standard of living in HLM housing projects is the lowest in the country. HLMs were massively built through state-financed programs in the 1950s, as a response to the postwar housing crisis, and have since then generated important clusters of social housing, which the SRU Law attempted to correct.

9 In addition to the infamous list of ‘enfants terribles’ published every three years by the state and the Fondation Abbé Pierre, regular newspaper headlines published since 2015 illustrate the controversy: ‘Construction of HLMs: the list of 36 resisting municipalities’, (La Tribune 2015), ‘Social housing: Le Cannet, the city that gets the highest penalty for not respecting the SRU Law’ (Europe 1 2016), ‘Fees could be skyrocketing for the bad pupils of social housing’ (Le Figaro Immobilier 2017), ‘These cities that will pay (again) a fee for not building enough social housing’ (Le Capital 2017) (Author’s translation from French).

10 Atelier parisien d’urbanisme, Paris’s planning agency.

11 Fiscal data collected from 1999 to 2015 looked at the correlation between the type of housing built and income for all municipalities. A segregation index was built to evaluate the distribution of social housing unit percentages by municipality, relative to the national average.

12 As a reminder, the SRU Law is comparable to other European programs in the United Kingdom or Germany. A similar program in the United States would be the Massachusetts Chapter 40B.

13 This paper sheds the light on a narrower body of literature that focuses on French references. It should be complemented with a more extensive literature review that bridges francophone and anglophone references on this theme.

14 Model 6 works as the only exception, with a lower power, where only 76% of the time will it accurately reject the null hypothesis.

15 Unless one wants to control for the percentage of immigrants in the local population.

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Magda Maaoui

Magda Maaoui is a doctor in Urban Planning at Columbia University GSAPP, and currently holds an assistant teaching position at the Université de Paris. Prior to being in New York, she was originally based in Paris as a civil servant trained in research. Her expertise lies at the confluence of housing policy, real estate development, community planning and spatial justice. Her dissertation looks at how politics and power relations have shaped inclusionary zoning outcomes in French and American historically disinvested neighborhoods. This comparative political economy is based on sociological and econometric research. Her goal is to start addressing the growing concerns of supply skeptics in the two global cities of New York and Paris regarding the redistributive features of inclusionary zoning programs. She therefore intends to produce policy-relevant, actionable findings for legislators, planners, and advocacy organizations eager to rethink land use systems.