Last June the Santa Monica City Council approved an ordinance that requires the developers of new condominium projects in multi-family zones to include 20 percent affordable housing in their projects if their proposed projects are four to 15 units and 25 percent affordable housing if their projects are 16 units or more. Under this “inclusionary zoning” program, these units can be ownership units affordable to moderate income households or rental units affordable to low-income households, at the developer’s election. Low-income households are generally defined to be families whose incomes are below 60 percent of the regional median income while moderate income is equal to the region’s median income. Under some circumstances the affordable units can be provided off-site in a separate development.
Developers of apartments would not have the same requirement because the City Attorney’s office believes state law may deny cities the authority to require inclusionary units in new apartment buildings. Developers of apartments in multi-family zones will continue to pay an affordable housing fee, as they long have, as will developers of multifamily projects in the City’s commercially zoned districts. The City will use these fees to develop affordable housing throughout the community. Unfortunately, these fees are far less than the actual costs of apartment development.
This new inclusionary zoning ordinance will join other efforts by the City of Santa Monica to ensure a balance of new affordable housing is built in the City each year as required by Santa Monica voters when they approved Proposition R in 1990. Proposition R requires that 30 percent of the total new housing units produced citywide each year be affordable to households below the median income, with half of that (15 percent of the total) affordable to low-income households.
It will surprise no one that Santa Monicans for Renters’ Rights (SMRR) strongly supported this inclusionary zoning program. Nearly thirty years ago when SMRR began as a small band of mostly senior citizen residents fighting for rent control, 40 percent of Santa Monica residents were members of low-income households, and many more were members of moderate-income households. Many were retired seniors. These residents were not only treasured friends, neighbors and community members, they gave Santa Monica a much-valued economic, social and cultural diversity.
The most significant and enduring local political issue over the past thirty years has been the debate over what the City should do to protect our renter households and preserve our affordable housing and with it this community diversity. Rent control has been and is still the core of this effort. But several state laws, adopted at the urging of the very powerful California real estate industry, have eroded our rent control protections significantly and worked to undermine the diversity of this community.
First, the Ellis Act in 1986 gave landlords the right to “go out of business” by evicting all of their tenants at once. In Santa Monica, and other communities, in practice, this law has become the “condo developers beneficiary act.” The Ellis Act is merely a pretext for ridding a property of tenants so that the apartments can be demolished (or converted) to make way for new expensive condominiums. All told, Santa Monica has lost over 1,600 units to “Ellising.” This year to date, families in 94 units have been “Ellised” and their apartment taken off the rental market to make way for some very expensive condo projects. “Ellising” is threat #1 to the security of Santa Monica renter families.
Second, the Costa-Hawkins Act required all rent control laws beginning in January 1999, to provide for “vacancy decontrol,” whereby rents go to market levels – that is, through the roof – whenever a rental unit is vacant. Since vacancy decontrol has become law, over 13,000 rental units – nearly half of the City’s previously affordable rent controlled units – have gone to market rates, dramatically reducing the City’s supply of housing affordable even to moderate and middle income households, much less low-income households.
It was in the context of the early years of the Ellis Act that Santa Monica voters approved Proposition R, motivated by a concern that our community was at risk of losing much of its affordable housing and its historic economic diversity.
In addition to this newly adopted inclusionary zoning program the City will continue its own very proactive effort to build new permanently affordable housing. This is accomplished most often through various non-profit developers, primarily Community Corporation of Santa Monica. Well over 1000 units have been built in Santa Monica to be permanently affordable this way. But, because land prices have risen dramatically since 1990, and undeveloped land in Santa Monica is very scarce, new affordable housing development becomes increasingly difficult. As a result, requiring on-site inclusionary units is an essential tool for meeting the voter’s mandate in Proposition R.
Santa Monica is far from being alone in the adoption of an inclusionary zoning program. More than 100 California cities have some form of inclusionary zoning. Each community’s circumstances and the particulars of their program may differ. But each program is a recognition of the essential need for affordable housing for lower-income working families in any community, both as a matter of a matter of economic health as well as for ensuring the social health of our communities. The working poor provide essential services to all Californians. It is very much in the interest of all Californians, including Santa Monicans, to ensure such families have decent housing close to job-rich urban communities.