City OKs Loans for Low-Income Housing

A new program designed to prevent deterioration and overcrowding in low-income rental housing has been approved by the City Council.

The Rental Rehabilitation and Assistance Program will provide loans, mostly in the form of second mortgages, to owners who wish to maintain their housing without raising rents, officials said.

The plan was developed partly in response to a problem with an apartment complex on South Walnut Avenue several years ago, when five buildings were found to have become deteriorated and severely overcrowded.

Many owners of low-income housing in the city are having problems maintaining their property while keeping the rents at affordable rates, city officials said.

“This will be a preventive measure,” said Eric Nicoll, the city’s redevelopment services manager, to “address issues that led to the conditions on South Walnut that were very expensive to repair.”

The city paid about $60,000 a unit to rehabilitate those apartments, Nicoll said, because the city needed to buy the property, relocate some tenants and make repairs. Under the new program, he said, about $10,000 to $12,000 a unit will be provided for general repairs and maintenance.

“The goal is to protect the city’s rental housing stock,” Nicoll said.

The city will establish conditions for the funds, such as limits on the number of residents and certain maintenance standards. The city also will help some owners refinance current loans at lower interest rates.

Money for the program will come from the city’s Redevelopment Agency and federal funds, officials said.

Councilwoman Bev Perry said that some residents had asked her if “helping private owners with city money” was a wise investment, she said. “But it’s important to remember that the funds are specifically to be used for affordable housing. They’re meant for these types of projects.”

“It’s the right thing to do for the quality of life here in Brea,” said Mayor Burnie Dunlap.