Rebecca Chambliss is a Realtor and a blogger. She is based in Rolling Hills, California and markets homes on the peninsula and even in San Pedro.
Rebecca knows the housing market better than any other blogger I have read. She knows so much more about housing than I will ever learn and she provided information in a logical and understandable way.
Ms. Chambliss' blogsite for Ponte Vista issues is: http://activerain.com/blogs/bex29/tags/ponte%20vista
and her main blogsite is: http://activerain.com/blogs/bex29
Ms. Chambliss has given me permission to post two of her posts on this site. I thank Ms. Chambliss for the great priviledge of posting her posts, here.
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Ponte Vista’s Low Income Housing
Rebecca Chambliss, Rolling Hills, CA
I've copied the low to moderate income housing regulations from the Los Angeles City site. Any new housing development in the city of Los Angeles is required to include 6% of Low income housing and another 9% of moderate income housing.
Low income is currently defined as households making 80% or less of the median local income, that is currently an income of $42,486 per year. Moderate income housing is defined as a household making 120% of the median local income a year. A moderate income household is making $63,729 per year.
This would mean Ponte Vista (if they were to build 1900 units) must make 114 units available for sale at $100,000 or less and 171 units available for sale at $191,824 or less (maximum affordable housing at those income levels with no down payment.)
These units must be "reasonably dispersed" throughout the development. So a developer can not segregate the "low income" housing from the non low income. Currently there is not anything from stopping a low income person from purchasing a low income property and then turning around to sell it at FMV, however developments must maintain the same 15% rate of low income housing.
If agreed apon with the developer, the HA can require that ANY of the units in the development be sold as low income housing to keep the number at 15%. So if a unit was purchased at a low income rate and that person turned it for a profit to sell at FMV, the neighbor who paid much more for his unit may be required to sell it for much less if the HA decides that one more unit is needed.
Something definitely to think about.
SEC. 12.39. LOW AND MODERATE HOUSING.
(Added by Ord. No. 145,927, Eff. 6/3/74.)
A. Requirements.
1. The developer of every housing development that is subject to the provisions of this section shall (a) make every reasonable effort to develop at least 6 per cent of the total number of units in the development at a cost which would allow them to be rented or sold as low-income dwelling units at the fair market value and at least an additional 9 per cent of the total number of units in the development at a cost which would allow them to be rented or sold as low or moderate income dwelling units at the fair market value, (b) if such units can be developed at such cost then make such units available at the fair market value of the Housing Authority or to low or moderate income households approved by the Housing Authority, and (c) execute such agreements with the Housing Authority as are appropriate to assure the continued availability of such units as low or moderate income dwelling units, which agreements shall be binding upon the developer and his successors in interest. In applying these percentages, any decimal fraction up to and including 0.5 may be disregarded and any decimal fraction over 0.5 shall be construed as requiring one dwelling unit. The requirements of this section shall apply to the developer of every housing development either constructed pursuant to a building permit issued after June 2, 1974, or converted to condominium ownership pursuant to a final tract map which is submitted for approval pursuant to a tentative tract map which was finally approved after June 2, 1974; provided, however, that the provisions of this section shall not apply to a housing development constructed pursuant to a final tract map approved before June 3, 1974, and/or tentative tract map wherein such tentative tract map was finally approved prior to June 3, 1974, and wherein in either event the construction of such development commences not more than six months after the approval of the Council of the final tract map and thereafter such construction proceeds in an expeditious manner as determined by the Housing Authority. (Amended by Ord. No. 147,691. Eff. 9/19/75.)
2. If the developer after every reasonable effort to comply with Subsection A 1 determines that it cannot so comply, then the developer shall grant to the Housing Authority in writing, on a form furnished by the Housing Authority, the continuing right of first refusal to lease at fair market value any of the units in the development, up to a total of 15% of the total number of units in the development. The developer shall execute and record an agreement to such effect running with the land. The Housing Authority may exercise its rights of first refusal at the then fair market value, whenever all occupants of any unit in the development terminate or give notice of intent to terminate their occupancy, and after such termination fewer than 15% of the total number of units in the development would be occupied as low or moderate income dwelling units. After the Housing Authority notifies the developer or owner that it may wish to exercise its right of first refusal, the developer or owner shall immediately notify the Housing Authority in writing of any such terminations or intents to terminate as they occur. Failure by the Housing Authority to respond within 7 days after receipt of the notice from the developer or owner shall be deemed a decision by the Housing Authority to not exercise its right of first refusal on that particular unit. (Amended by Ord. No. 159,162, Eff. 8/13/84.)
3. If the developer of a housing development of units for sale, after every reasonable effort to comply with Subsection A 1, determines that it cannot so comply, then it shall grant to the Housing Authority in writing, on a form furnished by the Housing Authority, the continuing right to require that any units in the development subsequently available for sale or resale up to a total of 15% of the total number of units therein, be sold at the then fair market value only to low or moderate income households approved by the Housing Authority. The developer shall execute and record an agreement to such effect running with the land. (Amended by Ord. No. 159,162, Eff. 8/13/84.)
B. Standards. Low and moderate income dwelling units required by this section shall:
1. Be reasonably dispersed throughout the development;
2. Generally reflect the average number of bedrooms per dwelling unit for the development as a whole; and
3. Be designed to harmonize with other residential structures and units in the development.
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Ponte Vista and the Private Transfer Tax
Rebecca Chambliss, Rolling Hills, California
It seems that Bisno development has worked out deals on other projects that involve a Private Transfer tax. What does this mean? A "fee" is taxed onto each property that is charged every time the property is sold. The "fee" goes to a named party. It can be the builder, an environmental or historical group (who often bargan for it in exchange for green lighing a development project). This is a fee that does not have to be disclosed in standard Real Estate disclosures. There are no limits as to percentage of the fee and no limits as to where the fee can go.
Could this be the reason a higher number of units is so important to Bisno?
Certainly 500 SFR in a gated community would net the same sales amount as 1900 mixed use units however, the more units with a private transfer tax associated would be much more long term income, since condos tend to turn over more than SFRs. Imagine 1900 units, each with a 3% "tax" that is paid back to the builder each time that unit is sold for the rest of time....quite a bit of money to be made there.
So, is the real argument not that we NEED more housing (because that isn't true) but that more housing means a longer string of ongoing income for the builder or for groups pushing to get the building approved?
This is the first of two comments related to this post.
Is there any way of actually finding out if this is taking place with this development and what the details are?
This is Ms. Chambliss’ response to the first comment.
Unfortunately, not unless the developer is asked and responds honestly. The City Council person's office for the area response to that question was, "this has not even been discussed and we don't know." It is a common practice by developers and usually when one has utilized a private transfer tax (as this developer has) they do it for other projects. It is something that can be "tacked on" just before the sale of a property and added to the title, to be there forever. I do believe it is a question that should be asked of the developer, however the answer will likely be, "we don't know yet."
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