Amid a housing crisis that is displacing the poor and forcing millennials and countless others to look outside the Bay Area to live, all eyes turned this week to the tiny Peninsula town of Brisbane where a developer wants to build thousands of homes on a 684-acre swath of wasteland.

Powerful tech companies, state lawmakers and pro-growth activists from around the region implored the City Council on Monday to allow housing on land once used as a rail yard and a landfill ​— an idea many residents oppose. But after hearing passionate arguments from both sides, the City Council shelved the decision, prolonging a land-use debate that has dragged on since 2005.

“There is a paralysis when it comes to decisions about housing, and the Brisbane project is the poster child for that,” said Matt Regan of the Bay Area Council, a business-sponsored public policy group.

The standstill in Brisbane crystallizes a challenge for state lawmakers desperate to address a statewide problem that has been decades in the making: Local governments wield tremendous power in decisions about whether and what kind of new housing to build, and they are not building enough. The Legislative Analyst’s Office estimates California is so behind that it needs as many as 100,000 more housing units a year — on top of what it typically constructs — just to stabilize prices.

In the nine-county Bay Area, the median price for a single-family home has topped $800,000. And nearly one-third of renters statewide — 1.5 million households — spend more than half their income on rent, according to state estimates.

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As soon as next week, lawmakers are expected to unveil a package of affordable-housing bills that will include new tools to prod cities and counties to add their share of housing — at least, in theory.

“I think that many of my colleagues understand that individual decisions by city councils and boards of supervisors are having an extremely negative and detrimental impact on our region,” said Assemblyman David Chiu, a former San Francisco supervisor who chairs the Assembly’s housing committee. “When you have so many decisions going the wrong way on proposed housing that meets all local laws and planning and zoning requirements we have to do something different.”

But none of the pending housing bills — as written — would immediately force the city of Brisbane’s hand. And some cities have flouted existing laws with similar goals.

A textbook example is playing out in Berkeley, which was sued last fall over a small housing development it denied. In February, the Berkeley City Council defied a court order to approve the development, as required by the Housing Accountability Act. The 35-year-old law — known colloquially as the “anti-NIMBY (Not In My Backyard) Act” — limits a city’s ability to reject a project that meets its zoning and land-use requirements.

After it was sued a second time by the same renters’ groups, Berkeley in July was again ordered to approve the six-unit Haskell Street development, which neighbors complained would cast shadows on their homes and create parking problems. The judge set a hearing date in late September and wrote that she would consider granting the approval herself if the city failed to do so by then.

In an interview Thursday, Berkeley’s new mayor, Jesse Arreguin, said the city would comply with the court order this time, but he defended the city’s recalcitrance. “We’re not anti-housing,” he said. “I think the issue with that project was that we were going to be very clear that we don’t want the state government to ram these projects down our throat.”

A similar scenario just unfolded in the South Bay town of Los Gatos. Early this month, the town approved the first phase of the North 40 development, a mixed-use project which many residents opposed — but only after developers took it to court, alleging the council’s initial rejection of the plan violated the Housing Accountability Act. A judge agreed.

Lawmakers in recent years have sharpened the housing accountability law underlying both court decisions, and they are now considering changes that would pack even more of a punch. Under a bill by Sen. Nancy Skinner, D-Oakland, cities like Berkeley that don’t comply with a court order would be hit with automatic fines of $10,000 per housing unit.

“While I did not write the bill for that case,” Skinner said, referring to Berkeley’s Haskell Street development, “it’s interesting that it is sort of a poster child for it.”

A more controversial proposal, Senate Bill 35, by Sen. Scott Wiener, D-San Francisco, would speed up the approval process for housing developments — limiting local reviews — in cities and counties that have failed to meet state goals for home-building.

Gov. Jerry Brown has made it clear that he will only sign a deal with money for affordable housing if it includes provisions to fast-track development — which, he argues, will make housing construction cheaper and quicker.

But land-use policy is more complicated than some make it out to be, and it belongs in the hands of local governments who are closer to the citizens than politicians in Sacramento and Washington, said Clay Holstine, the Brisbane city manager.

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Contamination from “nasty industrial chemical uses” is the main reason the Baylands area hasn’t been developed, he said.

“I really resist the notion that this is some sort of generational conflict,” he said. “It’s not new, and it’s not new to this generation.”

But like many in their generation, Holstine’s two children, who are in their 20s, live at home. “This is an issue that we talk about in terms of their being able to live here and affordability,” he acknowledged.

Wiener says he understands how complex the Brisbane decision is — the proposed addition of 4,400 homes could triple the city’s population — and he knows what it’s like to face a roomful of constituents “up in arms about a local development.” The former San Francisco supervisor said he also sympathizes with residents who love their communities and don’t want them to change.

But, he said, cities also need to plan for the future — “the needs of young people and the people who aren’t here yet.”

“The current system makes a mockery of planning effectively for future housing needs,” he said. “It’s a farce, and we need a better structure.”