More affordable housing on the way

BY ERIC LINDBERG
DAILY SOUND STAFF WRITER

Santa Barbara city leaders are expected to approve a grant of federal funds to purchase two buildings on De la Vina Street to add to the city's stock of affordable housing.
The City Council will discuss the funding option, a $741,080 grant of Home Investment Partnerships Program (HOME) funds, to purchase 633 De la Vina St. for the Housing Authority at its meeting tomorrow. Housing Authority officials plan to renovate the 50-year-old buildings and manage them as affordable rental units.

"While it suffers from some deferred maintenance, it's pretty basic with two buildings and a total of eight units — six one-bedroom units and two two-bedroom units," Robert G. Pearson, executive director and CEO of the Housing Authority, wrote in a letter to the city. "It is important to note that one and two-bedroom units are our biggest demand from a waiting list perspective. This property is also located in the Central City Redevelopment project area and our ownership would lead to needed landscape improvements and beautification of this otherwise drab corner."
The two-story buildings already house five tenants with federal Section 8 rental subsidies, referred to the owner by the Housing Authority. Five of the units will be designated as HOME-assisted if the property is purchased, limiting the monthly rent for one-bedroom units to $586 and $755, and two-bedroom units to $905, well below the estimated market rent levels of $1,150 and $1,675 respectively. The remaining units will be governed by Section 8 standards.
While federal HOME regulations require a minimum 15-year affordability covenant, city staff is recommending a 60-year covenant for this and other Housing Authority projects.
"Staff is comfortable recommending 60 years at this juncture for Housing Authority projects, given that the Housing Authority is a public agency constituted solely to develop, acquire, and operate affordable housing," city staff noted. "The Housing Authority's track record is exemplary."
Pearson said the Housing Authority plans to give the property a face lift, adding new treatments to the facades and providing new landscaping. Individual units will be upgraded as needed during occupancy and thoroughly renovated upon vacancy. Although the renovations are estimated to cost about $250,000, the Housing Authority plans to find alternative sources of funding other than city funds.
The property was recently appraised at $1.9 million and a sale price of $1.7 was reached between the Housing Authority and the owner, who provided a $200,000 tax-deductible gift. Close to $1 million of the selling price will be provided through a seller carry-back loan, with the HOME grant covering the remaining balance.
"The proposed project would be an important addition to the Housing Authority's stock of affordable housing and would greatly improve the presently drab appearance of a highly visible downtown intersection," city staff said.