O.C. Low-Cost Housing Is on Verge of a Boom

In an extraordinary push for more affordable housing for Orange County’s low-income and elderly population, officials are starting to draw on a multimillion-dollar windfall to finance hundreds of new and rehabilitated units throughout the county.

County supervisors have approved a handful of projects in recent weeks and are expected to consider many more in the coming months, as the Orange County Housing Authority continues to offer funds from a previously unavailable $15-million reserve account.

The money, which has been accumulating for the past decade, has become available only within the past eight months because of a loosening of Housing Authority rules. It has taken years, officials said, for the county’s conservative philosophy toward low-income housing development to evolve into a more aggressive strategy.

Access to the money also comes at a time when the county waiting list for affordable housing under a federal subsidy voucher system--known as the Section 8 program--stands at 7,000 people. No separate statistics on the waiting list for public housing are kept.

“People are suffering out there,” said Bob Pusavat, the county’s director of housing and redevelopment. “I have had people calling up praying and pleading on the phone, saying they have no place to go.”

Supervisor Harriett M. Wieder said that the county’s current involvement in affordable housing development is unlike any effort in recent history. The county’s goal is to use the reserve funds to help build 1,000 new low-income units throughout the county within the next three to five years.

If that goal is met, the construction effort would nearly double the 1,500 existing homes for low-income and elderly residents that the county has helped finance.

“The (economic) climate and the times have changed,” Wieder said. “There just wasn’t a lot of aggressiveness out there to do these kinds of projects. What has changed is the entrepreneurship of the builders, and the money is available now.”

Perhaps nowhere is the news more welcome than among the thousands who have been waiting months, and in some cases years, for an affordable place to live.

Laura Ortiz of Huntington Beach first put her young family’s name on the county waiting list for low-income housing two years ago and has been checking with the Housing Authority every month, hoping for a break. During that time, Ortiz, her husband and their 2-year-old son have been living with relatives or have shared a one-bedroom apartment where the $630 monthly rent drains much of her husband’s factory-worker salary.

“We keep calling here and they say they will call or send us a notice, but we never get anything,” Ortiz said outside the Housing Authority offices. “We need something as soon as possible.”

Michael M. Ruane, director of the county’s Environmental Management Agency, said the new projects are simply a reflection of current needs. In the more prosperous 1970s and ‘80s, the effort was geared more toward aiding first-time home buyers, Ruane said.

But at the same time, the Reagan Administration was sharply cutting federal funds for low-income housing. In recent years, Ruane said, the emphasis has shifted dramatically to the homeless and working poor.

“It’s a new commitment by the Board of Supervisors and the Housing Authority to use these housing reserves,” Ruane said. “I think there is a recognition that housing makes jobs, and it’s a good thing to get this kind of project going.”

This week, the supervisors approved plans for three separate projects in the cities of Orange, Stanton and Westminster that would provide financing for about 124 affordable homes, part of developments that will total 236 units.

Under a series of public and private partnership agreements in those cities, the county has agreed to contribute $2.3 million for development of those projects. The balance of the $34.4 million needed for construction will be put up by government agencies and private developers. In a separate action two weeks ago, supervisors also agreed to loan $1.7 million for what is expected to be the county’s first single-room-occupancy hotel for the working poor. That plan calls for the transformation of a former Travelodge in Costa Mesa to 97 rental units.

Within the next several months, officials said, five more projects with a total of 260 affordable units planned in Mission Viejo, Irvine, Orange, La Habra and Santa Ana are expected to be proposed to the supervisors. The units would be partially financed with contributions of more than $2 million from the county.

In some of the developments, the affordable houses will be mixed among those offered at the market rate, according to county documents.

To qualify for assisted housing, residents must earn no more than half the county’s median income, or $26,350 for a family of four and $18,450 for individuals.

Pusavat said all county funding earmarked for those projects would come from the authority’s reserve account, which until recently had been frozen by various county government restrictions.

For 10 years, the authority had been directing federal funds, originally allocated for local Housing Authority staff expansions, into the reserve account, Pusavat said.

The fund had not been tapped for construction or renovation purposes because of prohibitions against its use for the purchase of property, the financing of projects less than 50 units or extending grants in place of loans. These restrictions were relaxed about eight months ago.

Pusavat said the rule changes were spurred partially by the burgeoning waiting list for affordable housing in Orange County. By last November, he said, the waiting list had grown to an “unmanageable” 15,000 people, the most in recent memory.

That list has since been pared to about 7,000 in a purge of the system and reapplication process. Pusavat said the purge was needed to clean the rolls of people who were no longer in the area or in need of county assistance.

But even with the reduced waiting list and more pojects in the pipeline, “we’ll never be able to place them all,” he said.

Advocates for the poor said the county’s new commitment to low-income housing “is better late than never.”

“It’s been a desperate situation for a long, long time,” said Crystal Simms of the Legal Aid Society of Orange County. “It just hadn’t penetrated to the higher levels of county government.”

Simms said the reserve fund represented a “staggering amount of money” but still would not be enough to fill the need.

Before the county completes its work, Supervisor Wieder predicted that the projects would probably encounter some opposition from groups opposing location of the housing in their neighborhoods.

Wieder referred to an incident last year in which county officials abandoned plans for a 240-unit low-income facility above a Huntington Beach bus terminal. One of the key reasons for the collapse of that project was neighborhood opposition.

“It’s an unfortunate event that often accompanies putting in affordable housing projects,” Simms said.

With government resources on the decline, Susan Oakson, executive director of the Orange County Homeless Issues Task Force, said the reserve fund is especially crucial for the county.

“Our concern is that this is a precious resource and that it be used to create the most benefit and go as deeply as possible,” she said.

The availability of county funding couldn’t be more timely for cities, which can no longer count on drastically reduced state grants to help develop housing for low-income and elderly residents.

Without approval of a $325,000 county contribution, Linda Boone, executive director of the Orange Housing Development Corp., said plans for 22 units in the city of Orange planned for seniors and families “would have been dead.”

Boone’s project, which will provide 15 apartments for seniors and seven family units at a total cost of $2.9 million, was one of the three approved this week by the Board of Supervisors.

“We went to the county at the very last minute and their help was absolutely critical,” Boone said. “The state money is just not there any more. They (county officials) really understand these projects.”

Times staff writer Eric Lichtblau contributed to this story.

Housing Funds Found

The Board of Supervisors this week approved plans for county participation in three projects that will provide affordable housing for low-income and elderly residents. The county will provide $2.3 million of the estimated $34.4-million cost. The balance will be funded by public agencies or private developers.

Walnut/Pixley Apartments, Orange

Total cost: $2.9 million

County contribution: $325,000

Affordable units: 15 senior apartments, seven family apartments

Park Stanton Place Senior Apartments, Stanton

Total cost: $22.2 million

County contribution: $1 million

Affordable units: 33

Rose Gardens at Westminster

Total cost: $9.3 million

County contribution: $1 million

Affordable units: 69

Source: Orange County Environmental Management Agency