Two essential actions to move the state forward in its efforts to resolve the continuing housing crisis await state lawmakers when they return to Sacramento this week. The passage of Senate Bills 2 and 3 would directly address one of the largest challenges to producing rental apartments that low-income families can afford in the San Diego region and statewide: funding.

CommentaryLocal jurisdictions statewide lost more than $1 billion a year in funding to create and preserve affordable housing when redevelopment agencies were eliminated in 2012.

SB 2 by state Sen. Toni Atkins would generate about $230 million to $260 million annually through a $75 fee on documents in each real estate transaction, excluding home sales. The maximum total fee would be $225 per parcel. This permanent, ongoing source of state funding could leverage billions of dollars in federal, local and private investment to create and preserve affordable housing.

SB 2 will also create affordable rental and for-sale housing that meets the needs of a growing workforce earning up to 120 percent of area median income. It will deploy these funds through a private-public partnership, thereby creating jobs and generating revenue for local governments, while building safe and affordable apartments and single-family homes for Californians in need, including families, seniors, veterans, people with disabilities and individuals experiencing homelessness.

A companion bill, SB 3, written by Sen. Jim Beall, would provide voters the opportunity to decide on the November 2018 ballot whether to approve $3 billion in bond financing. The $1.5 billion proposed for the state’s multifamily housing program would support affordable housing developments like Independence Point in Lincoln Park.

Independence Point opened last year as the first residential complex in Southern California to provide affordable housing specifically for families with members who have developmental disabilities. More than $3.1 million in multifamily housing program funds and a $2.5 million loan invested by the San Diego Housing Commission were among the funding sources for the $13.5 million development of Independence Point, which created 31 affordable rental housing units.

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SB 3 would also set aside $200 million for the state’s transit-oriented development implementation program, through which low-interest loans are available as gap financing for rental housing developments that include affordable units and are within one-quarter mile of transit stations.

Trolley Park Terrace, which provides 51 affordable rental apartments for low-income families in Chollas View, is an example of the type of development these funds would support. A California transit-oriented development loan of $4 million and a San Diego Housing Commission loan of $3.1 million were invested toward the $23 million total development cost of that project, which is located adjacent to the San Diego Metropolitan Transit System’s Euclid Avenue Station.

Ongoing state funding sources created by SB 2 and SB 3 would also enhance San Diego County’s new efforts to address affordable housing and homelessness. These efforts include the commitment of $25 million in unallocated reserves to create an affordable housing fund, as well as the designation of 11 surplus county properties for the potential development of affordable housing. In addition, $500,000 has been designated to support studies and pilot programs to identify innovative housing solutions.

The need for affordable apartments is significant statewide and throughout the county.

While the city of San Diego is projected to need 38,680 additional rental housing units for low- and very low-income residents between 2010 and 2020, according to the 2011 San Diego Association of Governments’ regional housing needs assessment, only 5.9 percent of those units were built between 2010-2013, according to SANDAG’s regional housing progress report released in May.

A variety of solutions is needed to address the housing crisis, including reducing regulations and costs. We also support these efforts. But without adequate, stable sources of funding, the development of affordable housing will continue to lag behind the need, leaving families, seniors, veterans, individuals with disabilities and homeless individuals with precious few options for a place to call home.

We urge the state Assembly to quickly pass, and the governor to sign, SB 2 and SB 3 to provide the resources sorely needed throughout the state and here in San Diego.

Ron Roberts is a San Diego County supervisor representing District 4 and chairs the Regional Task Force on the Homeless. Chris Ward is the city councilman representing District 3, and is vice chair of the Regional Task Force on the Homeless. Richard C. Gentry is CEO of the San Diego Housing Commission and a board member of the Regional Task Force on the Homeless. Their commentary has been edited for style and clarity. See anything in there we should fact check? Tell us what to check out here.

    This article relates to: Growth and Housing, Housing, Opinion

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    Don Wood
    Don Wood subscriber

    Unless the county or local cities build new housing, and keep control of it, how can we ensure that developers won't take the money and build new apartments, then charge market rates for them?  Is the way to solve homelessness to build new housing and let the homeless move in for free? What about helping them develop new job and social skills that would let them compete in the real world first? As Sean M note, allowing former homeless people live in new affordable apartments at some subsidized rental rate gives them a clear incentive to stay poor, in order to be allowed to remain in their subsidized apartments. What we need are new programs that rebuild their self-respect, and give them back the skills they need to live in the real world, and make them capable of paying market rate rent instead of living in taxpayer funded "low income affordable housing", which comes with a stigma of its own.

    Sean M
    Sean M subscriber

    Thank you for including cost figures. According to this piece, "affordable" housing cost $450k per unit to build which is as much as many luxury units sell for. ($23m / 51 units = $450980 per unit) or ($13.5m / 31 units = $435483 per unit).

    Spending $200m on affordable housing only builds 444 units at this rate, not even countingthe ongoing expenses of operating these facilities at a loss. You can tell our politicians are interested in ribbon cutting ceremonies for their friends who win the affordable housing lottery, not about the greatest good for the greatest number.

    The most insidious aspect of the affordable housing trap is mantaining a low income. Thoseliving in affordable housing don't celebrate a raise or a promotion that increases their income month above the poverty line if it gets them thrown out on the street.

    Don't vote for the tax on affordable housing.

    tadh joackson
    tadh joackson

    Another way to look at it:

    $200M is $17 per unsheltered homeless in California person per year. So that $75 real estate fee couldn't even provide one night of shelter per homeless person per year.

    By most estimates we're short more than 100,000 units of housing per year in California, which will take several trillion dollars to create, so we're not going to subsidize our way out of this one. This mickey mouse $75 real estate fee is just a way to look like we're doing something without making the hard choices needed to fix the problem.

    Sean M
    Sean M subscriber

    Agreed. Another angle is that at $450k per unit, $1 million in government "affordable" housing expenditures gets two people off the streets. So assuming a 100k unit shortage, t will cost the state $50 trillion to resolve the shortage. ($1m * 100k units ÷ 2) The government could build the housing away from high cost luxury areas like downtown, but the less expensive housing areas are far from the public transportation the government wants people to become dependent on.

    The irony of the affordable housing fee is that it pushes housing costs even higher and housing costs are what caused this misery in the first place.