BILL ANALYSIS                                                                                                                                                                                                    

                                                                  AB 1641
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          AB 1641 (Hall)
          As Amended  August 9, 2010
          Majority vote
          |ASSEMBLY:  |46-26|(May 13, 2010)  |SENATE: |21-13|(August 18,    |
          |           |     |                |        |     |2010)          |
           Original Committee Reference:    PUB. S.  

           SUMMARY  :  Establishes that public housing projects over  
          50-years-old are blighted if they meet the blight definition and  
          provides the requirements for redeveloping public housing  

           The Senate amendments  require that replacement housing, for  
          displaced households that choose to relocate meet the following  

          1)Be provided at a rent that does not exceed 30% of that  
            household's income; and, 

          2)Be provided at a unit size and type that is required by the  
            displaced household and requires the size to conform to the  
            principles for a public housing policy for unit size as  
            provided in the "Public Housing Occupancy Guidebook" published  
            by the U.S. Department of Housing & Urban Development (HUD). 

           AS PASSED BY THE ASSEMBLY  , this bill established that public  
          housing projects over 50-years-old are blighted if they meet the  
          blight definition and provides the requirements for redeveloping  
          public housing projects.  Specifically,  this bill  :  

          1)Declared that a government-owned housing project constructed  
            prior to January 1, 1960, may be blighted if it is  
            characterized by one or more economic or physical blight  

          2)Required a redevelopment agency that is undertaking activities  
            or funding to replace blighted government-owned housing  
            projects must do all of the following:

             a)   Comply with all the requirements of Community  


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               Redevelopment Law (CRL);

             b)   Provide replacement housing on at least a one-to-one  
               basis of all existing public housing units affordable and  
               occupied by extremely-low, very-low and lower-income  
               households, at the same or lower-income levels as the  
               household displaced by the removed public housing units;

             c)   Require replacement housing to be restricted by income  
               level for at least 55-years and be provided by the unit  
               type required by the displaced household;

             d)   Require that replacement units must be inside the  
               project area or within a five-mile radius of the public  
               housing that is being replaced; and, 

             e)   Require households displaced by the removal of public  
               housing units to be offered permanent replacement housing  
               at the initial time of relocation, unless the household  
               decides not to accept the replacement housing.

          3)Provided that replacement units may be either publicly or  
            privately owned.

          4)Provided that additional privately owned housing units may be  
            available to moderate income households.

          5)Provided that workforce market-rate housing units, retail  
            services, commercial, industrial, educational, recreational  
            and other uses may be included in the development to serve the  
            residents of the area and public improvements inside and  
            adjacent to the project area. 

           COMMENTS  :  Community Redevelopment Law (CRL) requires  
          redevelopment agencies to insure that low- and moderate-income  
          housing units are replaced, if they are destroyed or removed as  
          part of the redevelopment of a project area.  Units are required  
          to be replaced on a one-to-one basis, with an equal or greater  
          number of bedrooms as those removed from the project area.   
          Redevelopment agencies are required to develop a relocation plan  
          for displaced low and moderate income residents.  Prior to  
          destroying or removing low-and moderate-income units, the  
          redevelopment agency must make sure that qualified residents are  
          relocated to replacement units. 


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          According to the sponsor, the Los Angeles County Redevelopment  
          Agency (LACRA), LACRA is authorized under the CRL to act in  
          areas of the city that have been designated by the city council  
          as being eligible for redevelopment. After making findings  
          required by law and following the many required procedures, the  
          LACRA and city council may adopt redevelopment plans for areas  
          of the city that need revitalization.  In order to justify the  
          creation of these areas, LACRA must demonstrate that the  
          conditions of the neighborhood, specifically the buildings (both  
          residential and commercial), are blighted.
          Since units within these neighborhoods are considered federally  
          funded public housing developments, the housing authority is  
          obligated under its operating agreement with the U.S. Department  
          of Housing and Urban Development (Public Housing Act of 1937) to  
          maintain the units in decent, sanitary and safe conditions.  By  
          determining that the neighborhood and specifically the  
          residential units are "blighted," LACRA would be making a  
          determination that would call into question the housing  
          authority's compliance with its operating agreements. This would  
          be highly problematic and jeopardize the operating subsidy that  
          the authority receives for these housing units and, thereby,  
          endanger the housing for families living within public housing.   
          When the federal government announced the closure of surplus  
          military bases in the 1990's and transferred ownership to local  
          governments, the California Legislature amended the CRL to allow  
          for the expedited adoption of redevelopment plans to provide for  
          the accelerated conversion of these former military bases into  
          productive civilian uses.  The "Military Base Conversion  
          Redevelopment Agencies" law made it possible for cities and  
          counties in California to place these targeted areas back on the  
          tax roles and authorized these areas into new commercial,  
          industrial and residential uses, including affordable housing. 
          A similar approach is needed for Los Angeles' older public  
          housing projects.  By seeking state legislation, that would  
          apply the precedent of the military base conversion statute to  
          the redevelopment of public housing sites, the LACRA and Housing  
          Authority of the City of Los Angeles would be able to establish  
          a test program in South Los Angeles where public housing  
          projects such as Jordan Downs and Nickerson Gardens in Watts,  
          which combined consist of 1,700 units of housing, may be  
          converted into well-designed privately owned mixed-income  
          communities, while ensuring the continued affordability of  


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          replacement housing at least equal in number to the existing  
          housing in the project area.
           If a redevelopment agency removed or a replaced public housing  
          project, this bill would require the agency to comply with all  
          of the provisions of the CRL.  Replacement housing would be  
          required on one-to-one units consistent with the income levels  
          of existing tenants including extremely-low income units and at  
          the unit size required for that income level.  The replacement  
          housing would have to be built and available to be occupied by  
          displaced residents before the public housing is demolished or  

           Analysis Prepared by  :    Lisa Engel / H. & C.D. / (916) 319-2085  

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