Anaheim officials want to boost the creation of affordable homes, but some council members are against mandating developers build low income housing in the projects or pay a fee which will be used to develop affordable homes elsewhere.
It comes after independent investigators last year alleged developer favoritism at city hall, including allegations that a prominent developer would sit in the city’s housing director chair, boss people around and invoke the former mayor’s name if there was pushback.
It also comes after a recent report showed that about 80% of homes approved to be built last year was for above moderate income families and about 11% were for low income and very low income families.
The County’s median income is close to $128,000, according to the state’s Department of Housing and Community Development. A four-person household making less than roughly $115,000 a year is considered low income and less than nearly $72,000 is considered very low income.
Housing advocates say inclusionary housing ordinances have been proven to work and such policies have been implemented in nearby cities like Santa Ana, Huntington Beach, Brea, and Irvine.
But officials in Orange County’s largest city – where about half of residents are on a public health plan – have long resisted calls to enact that type of policy.
[Read: Anaheim is Largest OC City Without an Affordable Housing Policy, Despite Calls to Create One]
City council members continued that resistance last week after they listened to a paid consultant list out ways for the city to improve their affordable housing stock, including requiring developers to account for those types of homes in their projects.
Inclusionary Housing Ordinance
Paul Silvern, a city-contract real estate consultant, told officials at Tuesday’s city council meeting that mandating a certain level of affordable housing on new developments – inclusionary housing laws – are working across the state and the country.
“There are well over 100 jurisdictions in California, and dozens more across the country that have some form of inclusionary housing, and they do definitely provide an increase in the supply of affordable housing, depending on the circumstances of how they’re designed,” he told officials.
Councilwoman Natalie Rubalcava said she doesn’t know if policies like this have actually been proven to create affordable homes and called inclusionary housing a “buzzword.”
“If I was a developer, I’d find it as a barrier to developing and for me, I think Anaheim has been such a good partner to so many developers that it doesn’t seem to be an incentive,” she responded.
Mayor Ashleigh Aitken said there needs to be more homes built in Anaheim and called inclusionary housing ordinance a community benefit worth considering.
“We have housing projects that are coming before us and some people are doing 20% as their community benefit, because that’s how they’re getting their larger project approved and some people are doing nothing,” she said.
She also said the city is relying on tax dollars to build affordable housing.
“Both as a city and as a taxpayer, we’re already building that housing and paying for that housing and I think that we should look at a way to spread it around more fairly so that we are treating everybody the same,” she said.
Rubalcava said such an incentive-based policy would create parking challenges, tie the city’s hands and not create equal treatment for everyone.
The councilwoman also lambasted the idea of developer fees aimed at building affordable housing.
“Now we’re just shaking down developers for a fee so they don’t have to build affordable. I don’t know how that’s a level playing field,” Rubalcava said.
She wasn’t the only council member to push back on developer fees and inclusionary housing laws.
Councilman Jose Diaz said inclusionary housing laws don’t work and said city staff could have presented a better report than the consultants.
“When you force builders to build low (income) units, somebody else has to pay for it,” he said “So, besides being so difficult to build in California, you’re going to put that on top of that. They’re going to go to Nevada, there are no housing issues in Nevada because they don’t make these requirements there.”
But Grace Stepter, the city’s director of Housing and Community Development, said an inclusionary housing ordinance would make a difference.
She noted staff has met with affordable and market-rate developers who said it would create an even playing field, opposed to spot-mandating affordable levels for each development.
Cesar Covarrubias, executive director of the Kennedy Commission, said in a Thursday phone interview that inclusionary housing policies are strategies that have been proven to work, pointing to success in cities like Santa Ana.
“People make the argument that the inclusionary housing ordinance may stifle development but the opposite has been shown in Santa Ana, where they have a pipeline of projects of over 4,000 units,” he said.
How to Build More Affordable Homes?
Last year, Anaheim city officials commissioned a $48,000 study of policies and programs they can implement to help create more affordables homes in Anaheim.
And last week, HR&A real estate consultants, who were commissioned to do the study, presented a list of policies and land use reforms ranging from upzoning to creating incentive programs for developers to build affordable homes.
To view the complete study, click here.
Stepter said the city has already implemented many of the suggested policies and programs – including a housing loan fund, a standardized development agreement strategy and motel conversions into housing.
Other strategies that have been recommended like a workforce housing incentive program, an inclusionary housing ordinance, or charging commercial developers impact fees have not been implemented by the city.
Stepter and Silvern said one of the biggest challenges is getting the funding to help develop affordable homes after the loss of redevelopment agency funds.
“Access to financial resources is one of the biggest needs with the loss of redevelopment in 2012, for which 20% of your annual tax increment was set aside for affordable housing. That just vanished overnight,” Silvern said.
“And it was the most important source of local affordable housing funding that you had.”
At their 5 p.m. meeting Tuesday this week, city council members are expected to debate the creation of an affordable housing trust – a fund that can be used towards rent assistance programs, affordable homeownership programs and eviction prevention programs.
It’s a move that comes as state officials are increasing pressure on local leaders up and down California to zone for 2.5 million new homes by the turn of the decade.
As part of those housing goals, Anaheim officials have to zone for 17,453 homes – of which 6,164 have to be for very low and low income families.
According to a recent progress report, Anaheim officials approved 965 permits for new homes in 2023 and built 534 homes.
Over 787 of the homes approved last year are for above-moderate income families and are not affordable housing.
Stepter said Tuesday there are currently 4,572 affordable homes in Anaheim currently.
The city has a population of 344,461 and about 13% of them live in poverty, according to the census.
Hosam Elattar is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at helattar@voiceofoc.org or on Twitter @ElattarHosam.
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