Santa Monica will debate streamline loan process
It’s up to voters to decide if Santa Monica can fund new affordable, rental housing with money earmarked for low-interest loans to first-time home buyers.
The city council voted on Tuesday to put a question on the November ballot that will ask voters to allow all taxes collected on apartments converted to condominiums be used to fund new affordable housing projects.
Currently, the city has about $8 million earmarked for low-interest loans as an incentive for home ownership. However, demand for the loans has been low and in 17 years of existence, only 51 loans have been administered, city officials said.
The city wants to redistribute the money to build new affordable, rental housing. But residents must vote to change the city’s charter to access the funds, which were collected under Tenant Ownership Rights Charter Amendment — also known as TORCA — which expired in 1996.
Of the roughly $20 million collected under the tax — which called for a onetime fee equal to 12 times the maximum rent allowable under law — half went towards buying a mobile home park, building low-income housing and administrative costs. The administrative costs alone reportedly exceed $1 million.
About $2 million has been used for home loans, but the remaining $8 million that would have gone into the home ownership program would be made available for building more affordable housing.
Detractors of the ballot initiative said combining the funds would ruin the home loan program and make Santa Monica a difficult place to live for the middle-class to live.
“All the new housing being built in Santa Monica right now is either for the wealthy or for the low-income,” said Paul DeSantis, a longtime supporter of publicly-financed low-income housing. “Home buyers, especially those in the middle-class, are becoming almost nonexistent in Santa Monica.”
But supporters of the initiative said combining all the money into one pot would not prevent the city council from still making low-interest loans to first-time home buyers.
“This would only allow the revenue set aside to be used for affordable housing,” said City Attorney Marsha Moutrie. “It would not preclude the use of... tax revenue for home-owner applications, but it would for the first time make all the money available for low-income housing.”
The council delayed debate on a resolution which intends to streamline the TORCA loan process until its next meeting on August 13. Accident victims all worked at Australian consulate
Originally published in the Santa Monica Daily Press print edition on July 26, 2002. Read the original PDF.