La Canada Expected to Delay Renewal Project

The La Canada Flintridge City Council is expected to postpone for at least a year its plan for a redevelopment project because of the possibility it would be forced to build state-required low-income housing within the city.

“I can’t see that we would ever have any low-income housing up here and we’ve never had any in the past,” Mayor Joan Feehan said.

Three of the five City Council members said this week they will vote to postpone the project, concurring with a recommendation that City Manager Donald H. Otterman said he will make at Monday’s council meeting.

The city’s hesitancy resulted from Gov. George Deukmejian’s veto two weeks ago of legislation that would have allowed the affluent city of Indian Wells to build most of its state-required housing outside the city’s boundaries.

“Indian Wells spent a lot of money trying to avoid it and it looks like it didn’t work,” Councilman Ed Phelps said. “Don Otterman is in tune enough to know that residents in La Canada and the City Council would never design into our community a plan for low- and moderate-income housing.”

After observing Indian Wells’ unsuccessful attempt to avoid the housing requirement, council members became worried that any similar plan would draw litigation from poverty lawyers.

“We don’t have to be out on the cutting edge challenging the courts,” Feehan said.

The City Council of the wealthy foothill community, which does not receive property taxes, decided three years to use California redevelopment laws to upgrade its commercial zone in the hope of attracting outside shoppers and increasing its tax base.

To qualify under state law for a redevelopment project, the City Council declared its entire commercial zone of specialty shops, grocery stores and banks along Foothill Boulevard to be suffering from economic blight.

The city’s redevelopment plan projects $40 million in redevelopment funds over a period of 40 years. The redevelopment agency would draw money from the business tax the city uses to generate funds to support itself.

The city staff and Los Angeles County have worked out a plan that would have allowed the city to waive a requirement that 20% of the redevelopment funds, in the case of La Canada Flintridge about $8 million, be spent on affordable housing within the city.

Instead, the city would give enough money to meet its housing requirements to the county, which would build the housing “on behalf” of the city in unincorporated parts of the county.

Weighing Use Elsewhere

Since 1976, state law has required that cities set aside 20% of their redevelopment funds for low- and moderate-income housing. The law was created because legislators thought that redevelopment was not fulfilling its purpose to provide affordable housing.

In an attempt to accommodate the city, Delta Uyenoyama, principal administrative analyst for Los Angeles County, said that the county was considering using the La Canada Flintridge money for low- or moderate-income housing elsewhere. The agreement between the city and the county would have needed approval of the Board of Supervisors.

Uyenoyama said the tentative agreement with La Canada Flintridge was the first of which he was aware.

The tentative agreement also included a promise from the county not to build that housing within the city limits of La Canada, Uyenoyama said.

“We feel that there is a need for low and moderate housing in general and we have a responsibility for the total county,” Uyenoyama said.

Meanwhile, the city staff also has been researching other possible ways to circumvent the housing requirement by declaring itself exempt under state provisions. To do that, the city would have to prove that it already has a sufficient amount of affordable housing or that no need exists. City officials argued that the city has no room for the housing and no poor people to use it.

“It has nothing to do with being prejudiced or discriminating against poor people,” Councilman Chris Valente said. “I don’t see how with homes costing $350,000 at the cheapest, when 97% of La Canada is already filled up, how could we build these things?”

Procedure Called Common

But City Atty. Stephanie Scher, whose law firm Brown, Winfield and Canzoneri serves as city attorney for five cities, said it is unlikely the city would qualify under those rules. These two alternatives have been assigned for study to the city’s Redevelopment Citizen’s Advisory committee.

Scher said it is “very common” for cities to look for ways to waive the housing requirement and that, sometimes, as in the case of La Canada Flintridge, a city does not have to have “buildings that are falling down” to qualify for redevelopment.

“The bottom line in terms of La Canada Flintridge is when a city starts suffering a loss of sales tax revenue because people who would be shopping in the city are going elsewhere,” Scher said. “The city is losing its life blood.”

Money from the city’s redevelopment project would have been used to improve the city’s commercial district, creating a “nicer climate to shop in” that would lead to increased sales tax, Otterman said. Projects would include street lights, street furniture and landscaping. There is also a plan for a low-interest loan program to businesses for store-front improvement.

The state’s Department of Housing and Community Development has determined that the city’s share of low- and moderate-income housing would be 712 units. The number was calculated by using the county’s Regional Housing Allocation Model.