Battle Brewing on Resident Hotels : CCDC Rejects Bid to Force Low-Cost Room Replacement

Charging that residential hotel owners would be unfairly penalized, San Diego’s Centre City Development Corp. voted Friday to oppose a move to preserve low-rent, downtown hotels or force developers to construct new housing to take their place.

The agency’s directors voted, 4-1, against two provisions in a proposed city ordinance that would require developers or hotel owners to replace rooms lost to renovation or demolition, or to help pay for their replacement. The provisions are designed to protect low-income residents of the hotels who would probably be forced onto the streets if the buildings did not exist.

Not present for the vote were CCDC members John Davies, who was not at meeting, and Peter Davis, who left before the ordinance came up for debate.

The ordinance, drafted by the city Planning Department and Housing Commission, was a response to growing concern over the loss of downtown residential hotels. The Planning Department estimates that, since 1976, 1,247 rooms have been lost--largely because of the city’s redevelopment program.

In December, the City Council adopted an interim ordinance prohibiting for one year the demolition or conversion of such rooms unless each room was replaced.

The two measures were among 27 proposals contained in a far-reaching ordinance that would regulate residential hotels, many of which are in poor condition. Most covered maintenance and safety regulations at existing hotels and were approved.

But CCDC rejected a provision that would require developers who tear down or convert existing rooms to provide replacement housing or to pay 50% of the room’s replacement cost. That money would be paid to the city and used to provide new rooms.

Under the provision, developers who opt to build replacement housing would do so based on a formula. For instance, a developer could remove a room if a new one is provided and rented at a low rate for five years. Or a developer could demolish two existing rooms if one is replaced and rented at a low rate for 10 years.

A second provision that calls for developers to pay displaced tenants $200 in moving expenses and an amount equaling three times their present rent, was criticized by some CCDC members as being unfair to developers. The agency’s staff estimated that the provision would cost a developer about $1,000 per tenant.

“You’re telling (hotel owners) ‘We want you to fix it up, but if you don’t keep it as an SRO (single room occupancy unit), we’re going to punish you,’ ” CCDC Vice President Jan R. Anton told Planning Department members present at the meeting.

CCDC President Howard A. Busby criticized the ordinance as “flying in the face” of the city’s goal not to congregate low-income housing in a single section of the city. In effect, he said, the proposed ordinance offers “a slum solution” to the housing problem because it guarantees that a large number of the hotels will remain in downtown.

Janay Kruger, who voted for the two measures, disagreed. She said she believes that conflict between developers and the city would be minimized because the ordinance allows individual developers or property owners to appeal to the City Council for exemptions.

(The interim ordinance allows CCDC to appeal to the council on individual projects.)

Assistant Planning Director Mike Stepner said, after the vote was taken, that he, too, believes any conflicts could be taken care of through individual appeals to the council. Stepner said he “welcomed” CCDC’s criticisms because they ultimately will assist the City Council in making its decision.

Ben Montijo, executive director of the Housing Commission, did not attend the meeting. In a telephone interview, he said he was uncertain what--if any--impact the CCDC vote would have on the ordinance’s eventual fate. The commission has approved all provisions of the ordinance.

“My guess is that the City Council is pretty well committed to the preservation ordinance and they are the ones who are going to make the final determination,” he said.

The Planning Commission is expected to vote on the ordinance later this month, after which it will go to the City Council’s Public Services and Safety Committee and then to the full council.