Low-Income Housing Needs on East County Cities’ Agendas : Simi Valley: Builders seek subsidies. But panel questions whether poor would be served.

Two developers are seeking nearly $1 million in city subsidies to build 12 houses and as many as 40 apartments for low-income Simi Valley residents.

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But city leaders said they want proof that the dwellings would truly be affordable for the city’s poor residents before they agree to commit city funds.

In a proposal to the city’s affordable housing subcommittee on Wednesday, the Cabrillo Economic Development Corp. asked for a $500,000 loan to help build up to 40 three- and four-bedroom apartments.

The second developer, Thousand Oaks-based Franklin Z. Greenspan, asked for $480,000 in loans to subsidize 12 single-family homes.

Neither developer has purchased a site for the housing.

The single-family homes would be sold for about $150,000 to families earning less than 75% of the county median income, about $40,000 for a family of four. The average price of a house in Simi Valley is about $200,000.

In accordance with state guidelines for low-income units, monthly rents for the apartments could not exceed $670 for three-bedroom units and $737 for those with four bedrooms, Cabrillo spokesman Ralph Lippman said.

Councilman Bill Davis, who chairs the subcommittee, said those caps may not be low enough.

“I don’t care what the state and federal guidelines are,” Davis said in an interview. “We need to look at what poor people in our city make and what they can afford.

“We have hundreds of single parents in this city who struggle to raise children and pay rent and live a normal life,” Davis said. “I’m looking for a project with rents that they are going to be able to afford.”

Councilwoman Judy Mikels, who also serves on the subcommittee, agreed.

“I’m uncomfortable with using city money to help pay for so-called affordable projects if people aren’t actually going to be able to afford them,” Mikels said. “To me a reasonable price for an affordable home would be closer to $100,000, not $150,000.”

Just where the city would get the nearly $1 million to subsidize the two projects is uncertain. No money is available for the next year in the city’s redevelopment agency account, which usually pays for low-income housing.

Greenspan said he would work with the city to come up with a compromise for the cost of the houses.

Lippman said Cabrillo would be willing to charge lower rents for the units if it could find more money to subsidize the building and maintenance of the project, which is expected to cost about $5 million.

“If we get more subsidy, we can charge lower rents,” Lippman said. “Anyone who builds this sort of housing agrees that you want to be able to charge as little as possible. It just depends on how heavily you are subsidized.”

Cabrillo, the county’s largest builder of housing for the poor, has constructed dwellings for low-income families in Moorpark, Ojai, Santa Paula, Ventura, Camarillo and Oxnard.

In 1985, Greenspan gained approval from Simi Valley for a $520,000 loan to help build a 32-unit condominium project called Royal Place. Seventeen of those units have been purchased by single mothers earning as little as $17,900 a year.

More recently, the city has contributed more than $1.8 million in state and federal grants and loans to three housing developments for low-income residents.

The largest subsidy, $877,000 in loans and grants, went to Heywood Gardens, a 75-unit senior citizen apartment complex that opened this year.

An additional $721,000 was granted to Cabrillo recently to help pay for the construction of 22 three-bedroom duplex units called Apricot Ranch.

And with the help of a $230,000 loan from the city, USA Properties broke ground this summer on Las Serenas, a 108-unit senior citizen apartment complex.

So far, Simi Valley has agreed to subsidize 1,415 so-called affordable dwellings, but 415 of those were for families with incomes at or slightly above the city’s median, which is $55,200 for a family of four.