SACRAMENTO, CALIF.—Developers in California found themselves in a fierce fight this year.
They have been battling to save thousands of affordable homes and jobs that could be lost if more than 400 local redevelopment agencies (RDAs) are eliminated as proposed by Gov. Jerry Brown.
A recent survey of 57 affordable housing developers revealed that they are working on 166 redevelopment-funded projects, according to Dianne Spaulding, executive director of the Non-Profit Housing Association of Northern California (NPH). These projects account for nearly 11,000 new homes, according to the survey conducted by the California Housing Partnership Corp.
“This is just the tip of the iceberg," says Spaulding.
Advocates say the figures represent only a small sampling of what is at risk if RDAs are dismantled under Brown's plan to reduce the state's $26.6 billion shortfall.
“It's going to change how to we do business if redevelopment agencies are eliminated,” says Laura Archuleta, president of Jamboree Housing Corp., a leading affordable housing developer based in Irvine.
Jamboree has eight projects under construction that have RDA involvement. While these developments have their funding committed, the nonprofit has several more in the pipeline where the funding is in jeopardy.
Archuleta is among the many developers who have gone to Sacramento to meet with lawmakers. “I feel many legislators support some type of funding or program for affordable housing,” she says.
However, it is difficult to know what form that could take, according to Archuleta. She points out that losing the RDAs would not only eliminate a key funding source but also the whole infrastructure in place for redevelopment efforts.
At press time in March, the state Legislature had yet to take action on the proposal. A coalition of mayors, Housing California, and others were offering different alternatives in an effort to defend affordable housing.
Redevelopment agencies are required to set aside 20 percent of their funds for affordable housing. However, many agencies dedicate much more.
For example, San Francisco's redevelopment agency has allocated more than half of its funding to affordable housing projects in the city in the past 10 years. The agency has 1,400 units in 11 projects that are in predevelopment and will be at risk without future funding, according to NPH.
Taking away the RDAs and their approximately $1 billion in funding would hurt affordable housing efforts at a time when the state is still recovering from foreclosures and the credit crisis. The state also has some of the most expensive housing markets in the nation. “We don't just have a budget crisis, we have a housing crisis,” Spaulding says.
It hasn't been an easy fight. As housing advocates were rallying, state Controller John Chiang issued a stinging critique of RDAs, saying they lack accountability. His office reviewed 18 of the roughly 400 agencies statewide.
The report cited inappropriate charges to the housing funds of several RDAs, including the city of Los Angeles charging 20 percent of its redevelopment administration costs to the fund and the city of Hercules charging $9,600 for lobbyist expenses.
Throughout the battle, Housing California, a statewide organization that educates lawmakers and others on homelessness and affordable housing, has been active on the issue and has prepared fact sheets and other materials. For more, visit .
Utah closes $74 million in bonds
The Utah Housing Corp. recently closed a $74 million bond sale, including $44 million under the New Issue Bond Program (NIBP), a collaboration involving the Treasury Department, the Department of Housing and Urban Development, and the governmentsponsored enterprises.
NIBP gave state and local housing fi- nance agencies the ability to provide very low-rate debt on fixed-rate bond deals.
Utah Housing leaders said they sold $44 million in bonds to the Treasury Department and $30 million to private investors under their private-activity bond program.
The issuance provided 30-year fixedrate mortgage loans for more than 500 low- to moderate-income families to buy their first homes. The average purchase price for the homes was $142,800, about 65 percent of the current average Utah home sales price.
Oregon adopts 60-year affordability period
Oregon has adopted a 60- year affordability period for developments receiving 9 percent tax credits and other funding from Oregon Housing and Community Services (OHCS). The policy does not apply to deals receiving solely 4 percent credits and bonds.
In other news, Rick Crager has stepped in as acting director of OHCS, taking over the top spot from Victor Merced. He was appointed by Gov. John Kitzhaber.
