FINALLY! AN ORDINANCE FOR AFFORDABLE HOUSING!
First, a big THANK YOU to YOU! Those of you who spoke at the meeting, came and held signs, and wrote convincing emails to the City Council deserve a round of applause! Without your help, this ordinance may not have passed.
THANKS TO THE HEAVY LIFTERS. We sincerely thank Councilmembers Andrea Marr and Arlis Reynolds who tirelessly worked to get this ordinance through. It may not be everything that the residents wanted, but it is something we can build on.
SLOW MOVING HEARING. About an hour and forty minutes into the meeting, the City Council got around to its first hearing on the agenda -- the second reading of the proposed inclusionary housing ordinance. After a presentation by City Staff and the consultant, Kathe Head of KMA, and public comments, at about the 3 hour and 30 minute mark in the meeting, we finally heard the first motion. Councilmember Marr moved to approve the proposed ordinance that was included in the Agenda Report, with a few modifications. She asked that they approve raising the percentages to 15% and 10%, reflecting what the public was requesting, adopt the in-lieu fee as proposed, but remove a section pertaining to homeownership and all other references to homeownership. Councilmember Reynolds seconded the motion. Both Marr and Reynolds spoke on it. After discussion, Councilmember Jeff Harlan made a substitute motion.
AND IT GOT SLOWER. Harlan’s substitute motion, which he said was “turning this on its head a bit,” was actually turning it on its head a lot. He basically went back to the meager crumbs that the Planning Commission offered up, which was 10%/5% percentages. Then he tried to sweeten the bitter cake with an icing of $2.5 million transferred from the City’s General Fund during the next budget cycle to an affordable housing trust for the purpose of acquisition, gap financing for developers, and support of affordable housing projects. He also eliminated the homeownership provisions. None of this would apply to any project under 60 units. The in-lieu fee would be postponed to an indefinite date. He topped that off with a proposal to gift developers a method to avoid compliance with the proposed ordinance using a development agreement. The effective date of the ordinance would be delayed (likely about two years) until the Measure K rezoning is completed.
Harlan then went on to justify his motion by triangulating it with the fact that the City has already done so much for active transportation, homelessness, eviction protection, and defending our sober living ordinance, therefore, it shouldn’t do much for affordable housing. He then said he doesn’t think the City should rely on in-lieu fees because the development process is a very slow process.
IT’S HIS CLIENT, SO HE SHOULD KNOW. Harlan cited the Costa Mesa Motor Inn/Lux Apartment project as an example. That is certainly one of the worst examples of how to manage a construction project. It has been nine years since its entitlement, yet it is just nearing completion. Why is that? Well, it was tied up in litigation for a long time and guess who represented the owner in the lawsuit? Jeffrey Harlan, Esq., the same guy who was up on the dais whining about it. His point was that having the City partner with affordable housing companies like Jamboree Housing, the City’s partner on the Senior Center housing project, would make projects work faster. Yet that project has also taken years to get going.
There was some discussion on the matter. Councilmember Manuel Chavez tried to make a point by saying that Harlan’s plan was good because it puts money into a fund so the City can help projects like The Bungalow’s get built. Wouldn’t the in-lieu fees from developers do that? He thought putting the ordinance off two years until rezoning would be done would be smart. As we heard from staff, developers are already putting in applications for general plan amendments so there could be housing built in the next two years with no affordable units, so that idea is not so smart. Chavez reiterated how he has bought into the false narrative that building more luxury housing will mean there will be more affordable housing. In my comments I gave the numbers that refute that mistruth. He also stated that taking the 10%/5% should make everyone happy because we finally have an ordinance. Then he went on to explain the percentages could be higher—that Staff had recommended it be as high as the 15% that public speakers were advocating. He contradicted himself several times, which led me to believe he felt conflicted in going along with Harlan.
QUID PRO QUO. After more discussion, including a discussion about the use of a development agreement, John Stephens said that the Council could use a “quid pro quo” to request affordable housing in a project coming to it under a General Plan Amendment. Good lord! That is the exact tactic that Righeimer used with the Baker Block project at the last minute. It wasn’t for affordable housing, but rather for $250,000 for the City to use as it pleased for public infrastructure. Councilmember Marr indicated it was a nonstarter for her. The anger and frustration in her voice was the same that was expressed back in 2015 by the residents. She was spot on in her comments!
WHERE WILL THE MONEY COME FROM? Councilmember Don Harper tried to make a point with Harlan about the $2.5 million being allocated next year to the housing fund. Those funds have to come from somewhere. Are we going to lose the money going toward greatly needed improvements at the Tennis Center? Harper commented that Harlan was making a broad-based decision about the budget right then and there without full consideration by the Council of how it impacts the rest of the budget.
There was a lot of discussion about the rezoning of the Measure K sites, the timing of it, and why it was so important to Harlan that the City rush through the rezoning. He finally said it was so that the City would do the rezoning and applicants wouldn’t have to request a General Plan Amendment. What that means is that there are developers waiting to get free rezonings at the expense of the City and they want to be certain they get the zoning they want, versus having to go through a discretionary approval process. Are we back to the days of backroom dealmaking?
SUBSTITUTE SUBSTITUTE MOTION. Stephens finally recognized Councilmember Reynolds who made a substitute motion to Harlan’s substitute motion. After discussion and some changes to Reynolds’s motion, the Council FINALLY agreed, by a vote of 7-0, to an ordinance structured as follows:
1. Percentage is 10% low/5% very low for all densities.
2. The Minimum project threshold is 50 units.
3. $2.5 million will be transferred from the general fund in the next budget cycle as a one-time payment to an affordable housing trust fund for "seed affordable housing," which includes a first-time homebuyer program.
4. Onsite production of ownership projects is not required, so developers can use an in-lieu fee or offsite production to avoid building for-sale affordable units onsite.
5. The in lieu fee will be discussed by the City Council at a later date (the in-lieu for 10%/5% is $19.50 per square foot).
6. The ordinance is effective immediately and it only applies to the areas on the Measure K map.
Staff was requested to bring back strategies to accelerate the rezoning and streamline projects subject to the ordinance.
That last statement that Chavez made in his comments on Harlan’s motion was something I would agree on, “We finally have an ordinance.”
CITY COUNCILS COME AND GO. The residents who lived through the years preceding Measure Y will remember what it was like to have a reasonable City Council be replaced with a City Council that brought the Minute Men Project to City meetings, ICE in the jail, who got us into more trouble in the courts than we’d ever seen, and sold the city to developers who, as Jim Righeimer put it, wanted to build the hell out of Costa Mesa. And they did, with little thought as to how it would impact the city. Most of it was stupid growth that ignored the smart growth principles the residents asked the City Council to consider. And then there was the Costa Mesa Motor Inn, whose owner Sam Menlo was infamously sentenced to spend time in his own vermin-infested apartments. It took Measures Y and AA, and a lot of hard work of walking precincts by a group of residents to get the Menshiemers/Rigbots[1] off the City Council and Planning Commission.
There is an election later this year. We may see new a City Council and Mayor. Will the next Council be better? We can only hope it will be kinder to the seniors, the veterans, the disabled, the workers, students and families who so desperately need somewhere affordable to live. Yes, we have an ordinance. We are delighted! NOW LET’S STRENGTHEN IT!
[1] These were names used by the public to refer to a prior City Council whose members included Jim Righeimer, Steve Mensinger, Gary Monahan, and a Planning Commission stacked with their sycophants, who rubberstamped the large housing projects the public dubbed “stackashacks.”