Affordable Housing

Housing affordability is a major concern to many of our residents, but I find that there’s much confusion among constituents about the City’s policies and practices designed to protect tenants and to preserve the affordability of the rental stock we have and to create new affordable housing for those who earn less than the Area Median Income (AMI).

First, we have rent control in Santa Monica in any apartment building constructed prior to April 10, 1979. Tenants’ rents can only increase annually by a percentage approved by the elected Rent Control Board, an adjustment to account for the inflation in costs of owning and managing a property. Rents can only go up by more than this annual adjustment when a tenant moves out – under vacancy decontrol, required by the state’s Costa-Hawkins Act, landlords can charge market rate for an apartment and then the new rent is again subject to annual controls.

All candidates will pledge to “protect rent control.” It’s an easy commitment to make, since rent control was added to the City Charter by the voters and can only be removed by another majority vote, an unlikely scenario in a city which is 71% renters. But ask the candidates if they support state Prop 21 on the ballot this fall, which would allow rent control to cover apartments constructed in 1995 or earlier and limit vacancy decontrol rent increases to a maximum of 15%.

For tenants in newer apartments, the Council has passed tough laws against tenant harassment and voters approved Measure RR, which allows for only “just cause evictions” and protects senior and the terminally ill from any evictions. Rules governing temporary and permanent relocations of tenants stipulate the payments landlords are required to make. Landlords are required to accept Section 8 vouchers from low-income tenants as rent payment and fair housing laws prohibiting discrimination are strictly enforced by the City Attorney. Finally, a newer state law caps annual rent increased at 5% plus the rate of inflation.

Another threat to our rent-controlled housing stock is a state law called the Ellis Act, which allows property owners to evict their tenants if they go out of the rental business, often to tear down the building and rebuild condos. To discourage the loss of these rent-controlled units, the Council reduced the potential buildable envelope for replacement buildings in these multi-family neighborhoods and significantly increased the relocation benefits which must be paid to tenants. And a new state law, SB 330, requires housing developers who demolish existing housing to replace any lost rent-controlled units.

All of the above provide stability and predictability for renters in Santa Monica. But housing can still be prohibitively expensive for those not in rent-controlled apartments, so how do we assure socioeconomic diversity in our population? How do we create opportunities for lower-wage workers in hospitality and retail to live here, so their commutes are shorter thereby reducing traffic congestion and greenhouse gas emissions? How can we pursue equity and inclusion in our housing policies?

Here’s the big picture: Prop R, approved by the voters in 1990, requires that 30% of new multifamily housing be affordable to low and moderate income households. While some years that target is met and some years not, overall since 1990 38% of new apartments built in Santa Monica have been affordable, meaning they come with deed restrictions that require them to be leased to income levels below AMI and at rents of no more than 30% of a household’s income. I daresay that if the rest of LA County had the same results we wouldn't have such a severe regional housing crisis.

Some of the candidates for City Council have asserted that we should build “low-income housing” instead of “affordable housing,” when the two are one and the same: apartments specifically required for lease to renters earning 80%, 60%, 50% or 30% of Area Median Income (each unit is deed restricted to one of those four categories).

So any market rate construction you see going on right now is required to provide a certain percentage of the apartments as deed-restricted to low income households through what is known as our Affordable Housing Production Program, more generically "inclusionary zoning:"

So that's one prong of our affordability approach -- and we audit the units annually to make sure they're in compliance with the income requirements. This sort of inclusionary zoning is the exception rather than the rule in CA.

Another and sometimes more visible approach is the public financing of 100% affordable housing, either via new construction or purchase and rehab of existing buildings (these are less obvious to the public and most of us don't know they're in our neighborhoods -- rent-controlled tenants stay as long as they wish and then vacancies are deed-restricted to certain income levels -- we just facilitated the purchase of a building on Virginia Avenue, saving the housing of longtime Pico neighborhood residents).

It used to be the City used most of its $75M per year of funds from our Redevelopment Agency to funds 100% affordable housing construction and rehabs . Then Jerry Brown killed off RDAs and we lost that spigot of cash. Voter approval of Measures GS/GSH restored half that cash flow and residual RDA payments (it's complicated) allowed us to rebuild our Housing Trust Fund and we now have many projects completed, including 64 units on Lincoln Boulevard paid for by a marker rate developer, and 38 units of housing for seniors:

There’s more in the works, here's an update on recent City loans for affordable housing:

Finally, the last arrow in our quiver is keeping people housed. We provide rental assistance for our lowest income seniors so they don't have to choose between rent, food and medicine. And we monitor existing low income housing and their deed restrictions, stepping in when needed to make sure people stay housed, as we did recently at two very low-income senior buildings where the deed restrictions were expiring – we provided over 300 Section 8 vouchers to keep those tenants in place.

Can we do more? Sure, if we have favorable outcome in the Presidential and Congressional elections in November. We need more Section 8 vouchers and more $ for construction of new affordable housing. But we're doing all we can given limited Fed funds and the elimination of the state RDA $.