New City Ready to Take Uneasy First Steps

As Laguna Woods officially becomes Orange County’s 32nd city today, it faces an uncertain future as the only city in the United States where residents younger than 55 are prohibited unless they are married to those who meet the age requirement.

All of the city’s housing units are inside the gated enclave of Leisure World, a retirement community that enforces the age limit through deed restrictions and private corporate rules.

State and federal laws allow age-restricted communities like Leisure World when they are in an unincorporated part of the county. But no such community has ever taken the next step to become its own city.

And that’s where Laguna Woods, which has 18,000 residents, may have trouble. No one is sure that the city will be able to legally remain an exclusive haven for senior citizens if it is challenged in court. Its ability to qualify for state and federal grants that demand open housing could be at stake.

“Uncharted territory,” said Julie Biggs, a Riverside attorney hired as interim counsel for Laguna Woods.

A key mandate all California cities face is the requirement to file a so-called housing element that describes how the city intends to provide housing for all types of residents, including lower-income families, as part of its general plan.

State and federal officials said it is too early to tell what will happen when Laguna Woods submits a housing plan that does not fulfill that obligation.

“Frankly, I don’t know how we’ll deal with it,” said Richard Freedman, an attorney for the state Department of Housing and Community Development, which approves housing elements.

“It’s a unique situation, and everybody is going to be watching to see how it sorts out,” said Joe Carreras, manager of comprehensive planning for the Southern California Assn. of Governments, which oversees regional planning and programs for the federal government.

Incorporation leaders who will be installed today as Laguna Woods council members say that they have the situation under control.

They insist that the exclusive nature of Leisure World’s housing restrictions, contained in the bylaws of three corporations that own most of the complex and in deeds covering the remaining homes, is beyond the city’s control. The city won’t discriminate on the basis of age or anything else, Councilman Bert Hack said.

“If we ever had additional units, they would not be restricted,” he said. But he noted that there is no undeveloped land within the city.

David Levy, housing specialist with the Orange County Fair Housing Council, contends the situation amounts to de facto segregation. But state housing law “is pretty toothless” and only binds a city to doing what is within its control, he said.

Housing laws ban discrimination based on race, religion, sex and national origin--so-called protected classes. Age, however, is not a protected class.

Local Agency Formation Commission members and city organizers at one point considered adding a 10-acre parcel of undeveloped land outside Leisure World’s gates to use for future homes, said the agency’s executive director, Dana Smith. The parcel was removed after the landowner objected to being included in the new city.

Another quandary involves state sales taxes collected by two small shopping centers that lie within the new city outside Leisure World’s gates. Each city in California gets a portion of sales taxes to cover the costs of street maintenance. Gasoline tax money is sent to cities for the same purpose.

But revenue from those taxes cannot be used on private streets, and all of the streets within the gates of Leisure World are private. The only public streets are small roads leading in and out of the shopping centers.