BILL ANALYSIS AB 1641 Page 1 CONCURRENCE IN SENATE AMENDMENTS 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 projects. The Senate amendments require that replacement housing, for displaced households that choose to relocate meet the following requirements: 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 characteristic. 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 AB 1641 Page 2 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. AB 1641 Page 3 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 AB 1641 Page 4 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 renovated. Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085 FN: 0005802