Editor’s note: This is the first of a series of articles on housing in Santa Monica. Future topics will include workforce housing, permanent supportive housing, the role of Development Agreements in producing affordable housing, and the importance of providing housing for all income levels to preserve the historic diversity of Santa Monica.
Santa Monicans have a long history of showing their commitment to affordable housing at the ballot box. From the passage of Rent Control in 1979 to the 1990 passage of Proposition R, which requires that 30 percent of all new housing units produced in the city annually be affordable to low and moderate income people, we continue to support the building and protecting homes for low wage workers and seniors and the disabled on fixed incomes.
What does affordable housing mean in Santa Monica? Who pays for it? Who develops and manages it? And who can live there? Answering these questions is important because there is a great deal of confusion and resulting misinformation circulating, particularly in cyberspace.
The definition of Affordable Housing used by the City is contained in state law. The legal definition is housing which is affordable to, and occupied by, individuals and families of low and moderate income. According to the state, low-income households are defined as those with annual income below 80 percent of Area Median Income (AMI). Moderate-income households are those with annual income between 80 percent and 120 percent of AMI. AMI’s for all areas of the country are published annually by the U.S. Department of Housing and Urban Development. State law also sets forth a formula for the maximum gross rents that can be charged for affordable units, which is again tied to the AMI for the area. Generally, the state says that people living in affordable housing should not pay more than 30 percent of their income to rent.
Santa Monica applies this legal definition to all affordable housing it finances and to private mixed-income housing in which the developer pays the cost of providing the affordable units. But our city goes a step further.
For Los Angeles County, the AMI is about $63,000 a year for a family of four, with adjustments for household size. Santa Monica defines “low-income household” as one that makes less than 60 percent of AMI (not the 80 percent prescribed by the State); a “moderate-income household” is one making not more than 100 percent of AMI (not 120 percent).
Santa Monica has two additional income groups served by its housing: extremely low-income households ($25,600 per year for a family of four; $17,950 for a one-person household) and very low-income households ($42,700 per year for a family of four; $29,900 for a one-person household). Santa Monica also sets maximum allowable rents that can be charged for affordable units.
Who in Santa Monica does this housing serve? As we all know, Santa Monica has a very large service sector because of tourists and a resident population that shops, eats in restaurants, and seeks entertainment here. Santa Monica’s affordable housing meets the needs of lower-wage employees who provide us with these services, eliminating the need for long and stressful commutes. Our affordable housing also serves seniors and disabled people on fixed income.
Who develops, owns and manages Santa Monica’s affordable housing? First, Community Corporation of Santa Monica (CCSM) is the major local nonprofit developer of affordable housing in the city. All their projects are 100-percent affordable; these projects serve families, seniors and the disabled whose incomes are extremely low, very low and low. CCSM finances its housing with public funding. For decades, Santa Monica had a steady stream of money — about $15 million a year — available for nonprofit housing developers like CCSM through its local redevelopment agency funds. That ended in 2012 when the state axed redevelopment in California. Since then, the City has been committed to identifying an alternative and ongoing local funding source.
The other major providers of affordable housing in Santa Monica are private developers who are required to set aside a percentage of the units in their projects as affordable (on-site or off-site) under the City’s Affordable Housing Production Program (AHPP). There is no public money involved in these projects. The cost of providing the affordable housing is borne by the private developer. In both cases, affordable units are deed-restricted to remain affordable for a minimum of 55 years.
So, how is Santa Monica doing in meeting its affordable housing production goals? Until 2014, very well. Of the 4,710 new housing units produced between 1994 and 2014, 1,884, or 40 percent, were affordable to low- and moderate-income people.
Of these 1,884 units, 1,175 units were affordable to very low- and low-income families and individuals. We exceeded the Prop R requirement of 30 percent.
Interestingly, about 22 percent of these new affordable units were produced by private developers as part of mixed-income housing projects and required no City money. It is also important to know that CCSM has acquired and rehabilitated hundreds of existing rental units as long-term affordable housing. Since Prop R only addresses new units, these existing units are not included in the overall count.
Finding new funding sources after the end of redevelopment and supporting the development of new affordable housing through supportive zoning regulations is now a challenge being faced by all members of the Santa Monica community. We are confident that the commitment that our community has shown over the years to social justice through the provision of affordable housing opportunities will continue in meeting this challenge.
Leslie Lambert, Judy Abdo, Jason Islas, Cynthia Rose, Craig Hamilton and Ernie Powell for Santa Monica Forward. Read previous columns at www.santamonicaforward.org/news.