City Council Considers Bond Measure, Policy Changes to Spur Affordable Housing

Sean Belk

Faced with a “housing crunch” amid diminishing state and federal funding resources, the Long Beach City Council is considering a bond measure, which would require voter approval, and various policy changes aimed at spurring more affordable housing investment in the city.

During a study session at the Feb. 21 city council meeting, city staff presented a draft housing report, including potential revenue tools and incentives for the production of more affordable and workforce housing. The report culminates about a year of research and community outreach, including a housing resource fair, forums and two mayor’s roundtable meetings.

After gathering input from developers, housing advocates, apartment owners, renters and community members, city staff is expected to present a final report along with policy recommendations to the city council later this year.

Real estate data shows rents and housing costs in Long Beach have continued to rise over the past five years, with the proportion of renters versus homeowners increasing as well, according to city officials.

Long Beach Development Services Director Amy Bodek, who presented the city’s draft housing report, said such factors are a reflection of the city’s low housing stock and low rental vacancy rate, which hovers at about 2 to 3 percent, causing increasing competition for available housing units.

The lack of housing for extremely low income to moderate income households is an issue not only in Long Beach but across the country and particularly in California, city officials said.

“We know that there’s a housing crunch that’s happening across the state [and] that housing crunch is also very real here in the City of Long Beach,” Mayor Robert Garcia said, who added that groups impacted by the housing shortage include working families, homeless veterans and students.

Garcia pointed out that the city is required under the state’s regional housing needs assessment (RHNA) to maintain affordable, senior and special needs housing each year. He added that it’s also important for the city to incentivize construction of all types of housing, including market rate.

According to data from real estate research website, asking rents for one-bedroom apartments in Long Beach jumped 26 percent from January 2012 to October 2016 while two-bedroom apartment rents in the city increased 41 percent during the same time frame.

For Los Angeles County, asking rents for one-bedroom apartments increased by 43 percent while asking rents for two-bedroom apartments rose by 51 percent, according to Zillow data.

The percentage of renters in Long Beach, meanwhile, has “inched up” to about 60 percent of the city’s population, while about 40 percent are homeowners, according to 2011 to 2015 survey data.

City staff also reported that 53 percent of renter households in Long Beach are “cost burdened,” meaning more than 30 percent of household income is spent on rent, while 30 percent of renter households are “severely burdened,” where more than 50 percent of income is spent on rent. 

The percentage of renter households in Long Beach cost burdened and severely burdened is slightly lower than in Los Angeles and Anaheim but slightly higher than in Oakland, San Francisco and San Jose, city staff noted.

Over the past decade, Long Beach has contributed to nearly $543 million worth of affordable housing investments, including providing subsidies to developers for maintaining a portion of affordable housing units in new development under covenants that often last up to 30 years, city staff said.

The city has currently budgeted more than $86 million for affordable housing, including about $69 million for the federal housing choice (Section 8) vouchers.

Still, Bodek said state and federal funding resources once used for affordable housing have dwindled in recent years.

A large hit came from the state’s elimination of redevelopment in 2012 that decreased the city’s share of property tax revenues set aside for affordable housing from a peak of nearly $35 million in 2011 to a low of about $7 million in 2013. Federal housing funds have also “decreased greatly,” she said.

“It’s a very expensive proposition to develop affordable housing, and resources that used to be available have frankly plummeted,” Bodek said. “We just don’t have the resources we used to have to develop affordable housing in the city.”

Some existing incentives for affordable housing include developer impact fee waivers and the state’s “density bonus” law, which the city adopted to provide up to a 35 percent density bonus, including reduced parking requirements and relaxed development standards, to developers of low-income housing, moderate-income condominiums and senior housing.

To protect and preserve affordable housing, city staff recommends considering a policy to limit condo conversions when vacancy rates drop below a certain percentage and a one-for-one replacement of all housing lost to redevelopment, among other recommendations.

To produce and promote more affordable housing, city staff proposes a local bond measure that would require voter approval for a “one-time” source of capitalizing the city’s Housing Trust Fund. Bond proceeds would be invested over a specific time period, such as for 10 years, in projects that meet certain local priorities and needs, city staff said.

Bodek declined to immediately estimate how much the bond measure would total. City officials noted, however, that voters in the City of Los Angeles last year passed Measure HHH, raising property taxes to assure $1.2 billion in bonds to cover construction of about 10,000 units for housing homeless individuals in the city.

Other strategies to boost affordable housing in Long Beach include: encouraging mixed-income housing by adopting an “inclusionary housing policy;” establishing incentives for developers; addressing zoning and regulatory impediments to affordable housing development and pursuing grants for transit-oriented development.

In addition, city staff recommends: encouraging project-basing of Section 8 vouchers for supportive housing; adopting an ordinance for “accessory dwelling units;” addressing housing needs for college students; supporting state reforms of environmental requirements for coastal developments; and reducing parking requirements.



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