> ## Content Index > Fetch the complete content index at: https://www.smdp.com/llms.txt > Use this file to discover other available public pages before exploring further. # Affordable housing sparks controversy and lawsuit - URL: https://www.smdp.com/affordable-housing-sparks-controversy-and-lawsuit/ - Published: 2006-10-18T15:00:00.000Z - Updated: 2026-10-23T21:41:27.000Z - Author: Kevin Herrera - Tags: Real Estate & Housing, Santa Monica, #archive-import *Affordable housing sparks controversy and lawsuit* CITYWIDE — While the production of affordable housing here fell last year to one of the lowest levels on record, City Hall has developed policies that, over the long haul, have increased the number of these units to above and beyond what is required by law. From 1994 to 2005, 769 affordable units have been built within Santa Monica’s city limits. That represents 37 percent of the total 2,089 units constructed in that period, according to a report prepared by city staff that looks at the success of City Hall’s Affordable Housing Production Program. The program was created following the passage of Proposition R, which voters approved in 1990 to increase the number of affordable housing units within Santa Monica. The amendment to the city’s charter requires that at least 30 percent of all newly constructed multi-family units in the city each year be permanently affordable to and occupied by low-and moderate-income households. Under the law, low income is defined as not exceeding 60 percent of the area’s median income. For a family of four in Santa Monica, an annual income of $41,580 or less is considered low income. Through a series of requirements imposed on developers, as well as incentives meant to entice the construction of affordable housing, City Hall has been able to exceed goals set by the proposition in six of the last 10 years. That said, the proposition’s standard of 30 percent affordability was not met in 2005, as only 5 percent of multi-family units completed that year were considered affordable. The only other time that production fell below 5 percent was in fiscal year 2002-03, in which only one affordable unit was built, representing half of a percent of the 212 total units built. Those opposed to City Hall’s policies see this as evidence that the council’s actions to increase affordable housing are backfiring, while others blame the housing market and the high price of construction. “It all depends on how you look at it,” City Councilman Herb Katz said of the city staff report. “If you take it year by year, sometimes you are going to be far below 30 percent. But if you look at it overall, we are providing more affordable housing than our goal. “We are doing more than our fair share, and I think that’s the way you have to look at it.” Housing production fluctuates considerably from year to year because of market forces and moves made by the council, which may or may not encourage developers to begin construction. “It’s a matter of what’s done in the market,” said Jim Kemper, a senior administrative analyst with the Housing and Redevelopment Division at City Hall. “If there happens to be only 100 units completed, and we’re able to fund one 30-unit housing project, then we’ve reached our goal. But if there is a much smaller project year, where some projects may get delayed, we fall below the goal we’ve set for ourselves.” The fiscal year of 2006-07 looks promising, as there are 62 new multi-family developments under construction. These developments contain 1,060 units, of which 236 will be affordable. If all of these developments are completed by the next reporting period, then 22 percent will be affordable, according to the city staff report. Another 35 multi-family developments — containing 703 units, of which 265 will be affordable — have received planning approval. If all developments are completed during a single reporting period, for example 2007 to 2008, some 38 percent will be affordable. In addition to building affordable units, developers of certain projects have the option of paying an in-lieu fee instead, leaving affordability up to City Hall. In fiscal year 2005-06, City Hall collected $619,126 in in-lieu fees, which are used to subsidize the development of new affordable housing units by nonprofit housing developers, such as Community Corp. of Santa Monica. Joan Ling, executive director of Community Corp., said nonprofits and private developers face a number of challenges when trying to develop affordable housing, including a lack of available land, rising construction costs and discrimination. “Like any project, you first have to deal with quality-of-life issues, such as traffic, parking, height — you don’t want to be blocking anyone’s views,” Ling said. “But then with affordable housing, you face an extra layer, which is the fear of poor people. Residents are concerned about property values going down and are concerned about what type of people would be living in these units, particularly if they are family units.” Ling said despite studies showing property values are not affected by affordable housing constructed nearby, homeowners are still leery of low-income residents living next door. Then there is the cost of buying the land. With property values doubling, sometimes tripling in recent years, finding land that is affordable has almost become impossible for some. “We don’t even look in residential areas anymore,” Ling said. “For one, it’s become too expensive, and two, we don’t want to tear down any existing buildings. We are more focused on the city’s commercial corridors where there is land available. It’s still expensive, and that makes a lot of projects unfeasible.” Even so, Community Corp. is expected to finish three housing projects by the end of the year, each with more than 40 units available for rent, the majority offering two bedrooms. To keep the momentum going, the council, minus Katz, in May made revisions to the production program that require developers of four or more condominiums in multi-family zoning districts to build affordable units either onsite or offsite. Some believe that this revision, known as inclusionary zoning, should increase the production of affordable units and help City Hall meet Prop. R with regularity. “I very strongly believe (incentives and the inclusionary zoning ordinance) will be effective in meeting the goal of increasing affordable housing,” said Councilman Ken Genser.“They all work hand in hand to help us meet this goal.” Not everyone agrees. City Hall is being sued by a coalition of apartment owners and developers over inclusionary zoning, saying it violates the Fifth Amendment to the U.S. Constitution, which prohibits the seizure of property without just compensation. They also charge elected officials with violating due process by not submitting the ordinance for approval by the state Department of Housing and Community Development, which must review action that constrains the production of new housing. While the construction of more affordable housing is the goal of the ordinance, attorneys representing the coalition said the best way to make more housing available is through market mechanisms and not through government influence. “The new law is going to reduce the amount of housing built, not create it,” said Rosario Perry, a land-use attorney who is representing the coalition in the lawsuit. “It’s made it impossible for a builder to put in a condo in Santa Monica. Instead of building five condos, developers are going to build three and pay in the in-lieu fee. Because in-lieu fees are based on square footage, the city is going to get less money to build their own projects. You are going to get less housing for the middle class. This is counter-productive.” City officials said it is unclear if Perry’s predictions will be realized. “Whether or not they chose not to build, we’ll just have to wait and see,” Kemper said. “Developers make their decisions based on a wide variety of reasons.” If City Hall wanted to meet the requirements of Prop. R annually, Perry said they must review their priorities and dedicate money accordingly. “They just need to spend more money on housing,” Perry said, who questioned the council’s decision to spend hundreds of millions on a new public safety facility and library. “They have plenty of money. If they want more housing, they can build it themselves.” ![](https://storage.ghost.io/c/55/9f/559f9abc-8372-4a2e-8c2d-27386da4e363/content/images/2026/10/101806-03_01.jpg) IF YOU BUILD IT: An affordable housing development sits at 15th and Broadway. (Photo: Alejandro Cesar Cantarero II/Daily Press) *Originally published in the Santa Monica Daily Press print edition on October 18, 2006.* [Read the original PDF.](https://s3.us-east-1.amazonaws.com/smdp%5Fbackissues/101806.pdf?ref=smdp.com)