Acting on the recommendation of an ad hoc committee led by Councilman Trevor O’Neil, the city council earlier this month approved that will create more than a 1,000 units of affordable workforce housing.
The council voted to participate in the California Statewide Communities Development Authority (CSCDA), a new state program that assists local governments in finance affordable workforce housing. Most state and federal affordable housing programs are geared toward low income households. The CSCDA targets middle-income households struggling to obtain affordable housing.
Under the program, the city will purchase three existing apartment communities: the Jefferson Platinum Triangle and the Parallel Apartments in the Platinum Triangle area, and the Alexan CTR City complex in downtown Anaheim.
The three complexes have a combined 1,017 market rate units, which will be converted to income and rent-restricted units managed by a project administrator contracted by the city.
The units will be allocated as follows:
- 40% of the units will be reserved for lower income households with incomes at or below 80% of the Area Median Income (AMI) – an increase from the typical practice of allocating 33.3% of units for such households.
- 20% of the units will go to households earning between 80% and 100% of the AMI
- 40% allocated to households with incomes between 100% and 120% of AMI.
If current tenants of these apartments are income qualified, they’re rent will be reduced immediately. Those who don’t qualify can stay as long as they want and renew their leases. When a non-qualified tenant moves out, the apartment is converted to an affordable unit. . It’s anticipated all 1,017 units will be converted to affordable apartments during the next two to three years.
According Councilman Trevor O’Neil, who chaired the ad hoc committee that recommended Anaheim join this program, purchase of the apartment buildings will be funded by city-issued bonds, which will be re-paid from rental revenues.
“The city may be giving up its share of the property tax revenue, but that is more than recouped by equity gains in the properties – which are ours to keep,” O’Neil pointed out on his Facebook page.
“After 15 years the city can refinance the properties and pull cash out, or after 30 years the city owns them outright,” said O’Neil. “Equity cashed out can be used for any purpose – funding city services, paying down pension debt, or reinvesting into more affordable housing.”
“This is the first deal of its kind in California,” said O’Neil. “It’s a great example of a public-private partnership to produce affordable housing very inexpensively.”