FULLERTON : City Settles Suit on Redevelopment Plan

In an out-of-court settlement, the City Council has agreed to allot half of all new low- and moderate-income housing to residents who earn 45% or less of the city’s median household income.

The city was named in a lawsuit filed in October by housing advocates Nadene Ivens and Roy Kobayashi. It challenged the validity of a redevelopment area designed by the Redevelopment Agency to encourage car dealerships to locate in Fullerton.

The suit contended that the proposed area was not not blighted--a requirement for redevelopment areas under state law. Ivens and Kobayashi later agreed to drop the lawsuit in return for a housing agreement.

As a result, 17% of the new affordable housing units built with redevelopment revenues will be designated for people earning 35% or less of median income, while 33% will be targeted toward people who take home 45% of the median household income.

Median family income in Fullerton is about $52,700, according to Gary Chalupsky, director of the Redevelopment Agency.

“This coincides with community needs,” he said. “Even though it goes deeper than state law, it seemed a reasonable objective for Fullerton.”

California law requires municipalities to set aside 20% of tax-increment revenues raised by redevelopment districts since fiscal year 1985-1986 to provide affordable housing for families earning from 50% to about 120% of median household income.

Under the settlement, the Redevelopment Agency will be required to adopt by the end of the year a five-year implementation plan for spending the housing money.

Chalupsky estimates that as a result of the agreement, more than $14 million will go toward developing affordable housing in Fullerton by the end of the decade.

Councilman Chris Norby was the only council member to oppose the agreement.

“It causes us to do more than state law requires,” Norby said. “I’m against that.”

Under the agreement, the Redevelopment Agency will begin allotting money for the housing units during the current fiscal year and is expected to be in full compliance with state law by the end of fiscal year 1998-1999.

The settlement also calls for the Redevelopment Agency to pay more than $27,000 in attorney’s fees for Ivens and Kobayashi.