Oxnard Is Accused of Cost Bias in Housing : Property taxes: Councilman says the city is discouraging low-income units, based on an internal memo that states they don’t generate enough funds to pay for municipal services.

An internal memorandum circulating among Oxnard officials for the past six months has become the basis of an informal policy of discouraging low-income housing projects in the city, a city councilman charged Wednesday.

According to the memorandum, single-family, detached houses in Oxnard must sell for $307,000 to generate enough property taxes to equal the cost of city services when broken down by individual housing costs.

Oxnard Councilman Manuel Lopez said Wednesday that the cost analysis is based on false assumptions. He added that rejecting low-income housing proposals because of the memo violates the city’s 1990 General Plan.

The memorandum was written in October, but Lopez said he decided to make it public because council members and city staff members have been using it to discourage low-income housing.

“Since the study was completed, I can sense the council does not want housing that is affordable,” Lopez said. “The city manager is an intelligent man and he reads how the council feels.”

The cost-benefit analysis, prepared by then-Assistant City Manager John Tooker, breaks down the cost of police, fire, street cleaning and other city services for single-family, detached houses in the city. The memo was distributed to City Council members, but was not publicly released.

The memo compares the costs of city services with the amounts the city receives in property taxes from homeowners. Using figures from the 1990 census, and assuming that each house is occupied by a four-member family, the study concluded that the break-even point is reached when houses are assessed at $307,695.

Community Development Director Dick Maggio said the analysis has become an important element in evaluating the desirability of new projects, but not the only one.

“In recent months, we’ve included a study where the net cost or benefit to the city is considered in all major projects,” Maggio said. “We’re certainly trying to come up with projects that are as cost-efficient as possible.”

But Maggio said other factors, such as a project’s overall public appeal, are also considered.

Councilman Michael Plisky, who ordered the study, said Tooker’s findings prove that the city needs more expensive housing.

“We have to build more high-end, larger units to bring the average up,” Plisky said. “If we build 10 units that cost $150,000, we have to build another 10 that cost $450,000.”

Plisky said the city’s problem dates to the late 1970s, when the council reduced property taxes twice out of political expediency. When Proposition 13 passed in 1978, those taxes were frozen.

Since then, he said, the average value of Oxnard houses is close to $200,000. Maggio said since the cost-benefit analysis was completed, the average price of new housing has gone up to between $250,000 and $300,000.

But Plisky said the city has to continue working to bring up the average price of new housing.

“We’re not generating enough property taxes to pay for basic services mainly because we have a large number of lower-cost housing,” Plisky said. “That’s where I get concerned.”

Lopez disputed the cost-benefit study’s findings.

“If the population doubles, that doesn’t mean we need two city managers, two housing directors and twice as many planning commissioners,” he said.

Moreover, the General Plan--approved weeks before the 1990 city election--requires that the city set aside 45% of new housing units for low-, very-low and moderate-income families.

“We approved that plan because that’s what the city wanted. If we aren’t going to build low-income housing, then we should change the General Plan,” he said.

Low-income housing activists throughout the county have long complained that Oxnard is dragging its feet in meeting the goals set in the General Plan.

Karen Flock, head of the county’s most prolific low-income housing development company, said Oxnard has done less in recent years to build housing for the poor than any other city in the county.

“The city has significant goals, but so far there hasn’t been a lot of progress,” said Flock, project manager for the Cabrillo Economic Development Corp.

“Most of the cities in the county are doing something to address the problem. Oxnard is doing less, especially in recent history,” she said.

Maggio said Oxnard is doing its fair share to house moderate- and low-income families.

In recent months, the city has approved condominium projects on Saviers Road and Wooley Road, and is processing permits for a new mobile home park, he said. The cost of these projects to the city is being subsidized by the sale of beach houses valued at nearly $1 million, he said.

“I suppose some people feel we should be doing more, but I think we’ve done quite a bit in terms of affordable units,” he said.

Mayor Nao Takasugi denied that the cost analysis has influenced his vote on housing projects. “It’s a known fact that housing doesn’t pay its own way,” he said. “That’s why bedroom communities have so much trouble, and that’s why we try to attract businesses and industries into the city.

“We need low-income housing,” he said. “This is a blue-collar city.”