CSUN Student Housing Program Faces Another Big Deficit : Universities: Officials say the quake has delayed efforts at stemming the flow of red ink. The losses may continue for years.

Despite the sale of a campus parking structure, the vacancy-plagued student housing program at Cal State Northridge will run a multimillion-dollar deficit again this year and may continue to lose money for another four years, university officials said.

CSUN’s housing was already the biggest money loser in the 20-campus Cal State system even before the January Northridge earthquake. But campus administrators said damage from the quake has delayed their efforts at stemming the housing program’s flow of red ink.

In one recent move, the Cal State University system’s board of trustees on Sept. 14 approved the sale of a 559-space campus parking structure for $3.9 million. That money will help reduce the housing deficits over a five-year period.

At issue is an attractive but costly 15-building complex of apartments planned in the mid-1980s amid a healthy economy and rising enrollments. But by the time the final buildings opened in 1991, the recession had begun and enrollment declines had translated into meager occupancy rates.

“No one would even deny we’re in a predicament,” conceded Ronald Kopita, CSUN’s vice president for student affairs. He and CSUN President Blenda J. Wilson inherited the fiscal mess upon their arrival in 1992, when former CSUN President James W. Cleary retired.

Even with the parking structure funds, Kopita said CSUN expects to borrow up to $2.4 million from the Cal State system for 1994-95 to cover housing deficits. And the university has told Cal State officials it may run additional, though hopefully smaller, deficits for the next four years.

Both sides have called this year’s aid a loan, repayable at some future date. But CSUN’s prior bailouts by the system--$4.7 million in 1993-94, $1.5 million in 1992-93 and $2.7 million in 1991-92--were simply funds taken from other campuses.

This fall, the three- and four-story buildings south of Lassen Street--known as the University Park Apartments--are

housing only 1,073 students of the 2,400 they were built to accommodate. Technically, that is a 45% student occupancy rate, the lowest in the Cal State system.

Without the earthquake, Kopita said, occupancy might have hit 1,500 to 1,600 students, a 60%-plus occupancy rate that still would be toward the bottom of all Cal State schools. Because of the vacancies, several entire dorm buildings have been converted to other uses, such as offices for university employees.

The main financial problem is that the campus continues to be responsible for a 30-year bond debt on the apartments and related projects that total more than $5 million a year, officials said. The financing assumed near full occupancy, but actual levels have never come close.

In an effort to close the gap and end the deficits, university officials have tried a series of gambits to reduce costs, shift housing costs to other parts of the university, fill the student housing with non-student renters and boost student occupancy.

But the Jan. 17 earthquake dealt a major blow to the latter goal. Seven of the 15 apartment buildings were closed for the entire semester last spring due to quake damage, and several of those still have not fully reopened. Repairs also turned the entire area into a construction zone.

Among other problems, Kopita said the still lagging economy continues to encourage cost-conscious students to live at home. And because of its original high costs, the campus housing complex continues to be more expensive than off-campus apartments in many cases.

The University Park Apartments, built in three five-building phases between 1987 and 1991, cost more than $60 million, campus officials said. As a result, even after cutting rents two years ago, the campus is still charging nearly $1,400 a month for two-bedroom apartments occupied by four students. By comparison, a study conducted by the university in 1993 estimated rent for a two-bedroom off-campus apartment to be less than $750 a month.

Also in recent years, the campus’ overall enrollment has fallen from a peak of 31,531 in fall, 1988, to a low this fall of under 24,000, a decline of more than 25%. Even last fall, before the earthquake, the decline since 1988 had been about 14%, well above the Cal State system’s average 8% loss.

But the outlook was much different in the mid-1980s, when university administrators were planning an ambitious $200-million public-private sector partnership to develop 100 acres of CSUN’s North Campus with a 20,000-seat stadium, 2,050-seat auditorium and other facilities.

The apartments, built by a division of Watt Investment Properties Inc. of Santa Monica, were to be the first part of the project. But when Watt pulled out of the so-called University Park project in 1992, it left the apartments alone with no other facilities to help support them financially.

“In fairness, you have to step back in time and look at what the environment was like then,” Kopita said, citing the strong economy and enrollments that grew steadily through most of the decade. At one point, university officials were projecting growth to 40,000 students.

Now, however, is a different world and the campus is trying to cope. By selling the three-level, 154,073-square-foot parking structure on Zelzah Avenue to the university’s parking program, the housing program will receive extra cash of about $780,000 a year over five years.

With office space on campus minimal now because of earthquake damage to permanent buildings, campus officials this fall opened two dorm buildings to office space for the first time. Kopita said various on-campus users are expected to pay about $1 million annually this year and next year.

And a third building has been set aside this fall for university employees to rent as housing. The monthly rental rate for employees is $825, substantially less than the student rate. And Kopita said about 25 of the 35 apartments available in the building have been rented thus far.

In other moves, university officials--as part of an estimated $15-million-plus effort to repair earthquake damage to the 15 dorms--wired them for cable television reception, which they had previously lacked. Once a provider is found, campus officials hope that will generate revenues.

Also, the university’s foundation, which operates the University Village Apartments nearby, has increased its contributions to the campus housing fund. Wilson has issued an order that departments paying to host guests must put them in the apartments instead of in off-campus accommodations.

Last year, the campus began charging students separately for their electricity and natural gas use, which previously had been included in their basic rent. Kopita said the university’s housing program has shed six jobs and taken other steps to cut its operating expenses.

Yet after all that, CSUN and Cal State officials continue to project housing deficits for the campus in coming years. Kopita said another possibility could be the sale of some buildings or conversion to condominiums, something a consultant is expected to consider this year.

One of the few bright spots on the housing scene, university officials said, is that delinquent rents owed by students, which at one point had ballooned to $2.8 million, have declined significantly in recent years. The amount still owed for the period 1986-93 is now down to $1 million.