Affordable Rent Plan Approved by Council

Wednesday, June 11, 2008
Lori Weisberg
San Diego Union Tribune

When San Diego housing officials learned last year that the city was free to withdraw from the federal government's decades-old public housing program, they immediately faced the financial reality of managing hundreds of rental units on their own.

Those new financial challenges came to the fore yesterday as affordable-housing advocates warned the San Diego City Council that the Housing Commission's proposed business strategy could mean fewer dollars being spent on the city's neediest households.

While the council approved the plan, it also instructed the commission to be mindful of its obligation to serve those households least able to afford market-rate housing.

"Our concern was that the commission would charge rents all the way up to market rate regardless of what income the commission would need," said Tom Scott, executive director of the San Diego Housing Federation, a coalition of affordable-housing developers and advocates. "I think rents for (former) public housing units will go up but not as high as they were planning to raise them, which was our main goal."

Under the financial strategy before the council yesterday, the commission is proposing to create 350 new dwellings affordable to a wide range of low-income households earning as much as 80 percent of the county's median income, or $63,200 a year for a family of four.

The commission's new business plan, which encompasses a broad range of housing activities, comes as the agency makes the transition out of public housing while retaining ownership of more than 1,360 subsidized rental units throughout the city.

Free of federal control - and operational subsidies from the government - the commission now must look at ways to increase revenue to manage the former public housing units that are reserved for low-income residents.

When the commission was granted permission last year by the Department of Housing and Urban Development to leave the public housing program, one of the conditions was that it would leverage its rental properties to produce 350 additional affordable units.

The commission has assembled a committee to review nearly a dozen proposals it has received from developers and property owners for acquiring existing units or constructing new ones. Because those proposals have yet to be analyzed, it remains unclear how much rental income the commission eventually will need to help finance the purchase or construction of those units while still managing its existing properties.

While San Diego now receives on average $450 a month per public housing unit, including the portion of the rent paid by tenants, the city could realize between $650 and $1,500 a month as it accepts higher-income households to replace those leaving the former public housing units.

"I think it's really important that the commission become more financially self-sustaining," Councilwoman Toni Atkins said. "If we don't do that, the long-range outcome is that the commission has less ability to provide housing for any level of median income.

"We have people losing their homes, and they're not at the lowest income levels, and we want them to be helped too. But you have to show us how you're not abandoning the mission."

Historically, the city's public housing units have been home to some of the city's lowest-income residents. Roughly 85 percent of the tenants in 2006 earned no more than 50 percent of the county's median income, the equivalent of $31,600 a year for a two-person household, according to the commission. The average tenant income then was just under $18,000 a year.

Current tenants in the commission-owned complexes have the choice of remaining where they are or getting a voucher that will help subsidize their rent in a private rental where they will not have to pay more than 40 percent of their income toward rent.

Carol Vaughan, interim chief executive officer of the commission, reassured the council that the agency's focus remains assisting the city's financially neediest households.

In addition to concerns raised about future rental housing policies, Councilman Tony Young urged the commission to make more of an effort to help the many homeowners facing the loss of their homes through foreclosure.

"This issue is getting worse," Young said. "If there's any department that will address this, it should be the Housing Commission."

FAIR USE NOTICE. This document may contain copyrighted material the use of which may not have been specifically authorized by the copyright owner. Tenants Together is making this article available on our website in an effort to advance the understanding of tenant rights issues in California. We believe that this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the U.S. Copyright Law. If you wish to use this copyrighted material for purposes of your own that go beyond 'fair use,' you must obtain permission from the copyright owner.

Help build power for renters' rights: