Archive for Monday, June 26, 2000

California housing money misses the target

June 26, 2000

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This industrial city has a problem many communities in California might envy: too few houses priced affordably but $23 million to do something about it.

The plan?

The city's redevelopment agency is studying a proposal to build new housing on a 74-acre gravel pit.

Putting enough rock and dirt in the pit to fill four basketball arenas would take nearly all of the $23 million the agency has for housing. So it will spend about $5 million to cover just a fourth of the pit and then put houses in the depression. Some of the 175 homes will be as much as 80 feet below their neighbors.

The idea initially "failed the laugh test" for Jan Breidenbach, executive director for the Southern California Association of Nonprofit Housing. She said that although she would have to look at the plans to know the project's worth, "it sounds weird to be building housing down in a pit."

Irwindale has one of California's roughly 400 redevelopment agencies, which get more than half a billion dollars a year in property tax and other public money for affordable housing.

Little, however, is being done to ensure that money is spent wisely, critics say, and even proponents acknowledge that no uniform rules exist, despite California being home to 14 of the country's 25 least affordable housing markets.

Twenty-five agencies spent every penny of the housing money on administration, according to a report by the state Department of Housing and Community Development. Other agencies, looking to minimize the housing they have to build, have spent money on needlessly expensive projects and infrastructure that has little if anything to do directly with housing, critics say.

Still others just won't spend the money. In 1997-98 the last fiscal year for which statewide statistics are available four including Irwindale, 20 miles east of Los Angeles, had more than $10 million in their accounts for three years in a row. Of 72 agencies in Los Angeles County, only 10 had more homes in 1997 than they did 11 years earlier, a study found.

"The one thing that's consistent is none of these cities spend enough of what they're required to spend," said John Mealey, who works with redevelopment agencies in eastern Riverside County as executive director of the Coachella Valley Housing Coalition.

Private lawsuits can have an effect. Catherine Rodman, a lawyer for San Diego Friends of Legal Aid, won a lawsuit against the San Diego County city of Poway, with a court finding it wrongly spent $2.1 million in housing money on street work. Now she's considering suing the Orange County city of Brea, which she said spent about $30 million in housing money on downtown street construction.

Redevelopment agencies pass bonds and can buy and develop land in blighted areas. The additional property tax money generated by the new development goes into the agency's coffers.

That property tax revenue amounted to nearly $1.8 billion in 1998-99.

One beneficiary was Frank Zepeda, who three years ago moved his family into a house built with redevelopment money just across the street from the Irwindale gravel pit. The city helped him cover half the cost of the $150,000 home.

Plenty of other people in the town and elsewhere would love to get the same opportunity, said Zepeda, 28, who works at In-and-Out Burger.

"There's a lot of young kids waiting for a house who have to live with their parents," he said.

Officials of Irwindale, a town of barely 1,000, defend the gravel-pit project. The town is so full of quarries that it's hard to find a flat place to build, interim city manager Joe Guzzeta said.

He said he thinks the 34-acre pit project will turn out beautifully with the help of landscaping.

"Hopefully, it will have the same feeling as if it's on a hillside looking down into a valley," he said.

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