Charities Sing Affordable-Housing Blues

United Cerebral Palsy of Los Angeles and Ventura Counties is hoping to build 10 apartments in Stanton if it can raise $400,000 to begin construction in the fall.

The units are among 57 the nonprofit organization wants to construct around Southern California for disabled people who have special needs and generally little income.

Although the group has state and federal backing for much of the $2.2-million project, the financial squeeze demonstrates the idiosyncrasies of building affordable housing in one of the most expensive areas in the United States.

“In Orange County, there is not a lot of housing for people with special needs, for people with low incomes, so anything that gets built is big news,” said Ben Phillips, a developer for the regional development department at Mercy Housing California in Orange.

The federal government rejected Mercy’s proposal to build housing for the disabled in Santa Ana this year, but the nonprofit group will try again next year, according to Phillips.

Ron Cohen, the cerebral palsy group’s executive director, said he believes he ultimately will be able to find the money by tapping foundations and individual donors.

But he and others said affordable housing, particularly for the disabled, requires so much persistence and takes so much risk and so much money, there are few nonprofit organizations that can build even 10 apartments. Orange County’s land costs are too high and land availability is limited, they said.

“Building this kind of housing is like making sausage; if you like it, don’t watch it being made,” Cohen quipped between phone calls to raise the extra funds.

“The process does not make sense. Affordable housing is only affordable to the people who move in.”

Even when nonprofit groups can find a location and funding, housing for residents with special needs is rare in Orange County because of neighborhood objections, advocates said.

“Imagine a city in Orange County where the city council gets excited about you bringing the mentally ill into town,” said Helen Cameron, executive director of Newport Beach-based Homes Inc., which hopes to build a $4-million, 30-unit apartment for the mentally ill in Midway City.

Julia Bidwell, Orange County Housing and Community Development Department manager of housing, finance and policy, said there are 17,000 affordable units in the county for families of four who earn about $40,000 or less.

That’s about 1% of the housing in Orange County, according to the 2000 census. The disabled and minimum-wage earners make far less than $40,000 a year, so only a portion of that 1% is available for them.

Although there is no official count of how much housing is available for the disabled, none has been built in at least five years, county officials said.

“Units for [the] extremely low-income have not been built at the pace we would like,” Bidwell said. “There is a large demand.”

Cohen’s organization has sought to change that in Orange County and elsewhere in the Southland. United Cerebral Palsy of Los Angeles and Ventura is building units in Santa Monica, Pasadena, Goleta and Burbank after receiving grants from the U.S. Department of Housing and Urban Development.

The Stanton complex in the 10500 block of Knott Avenue will offer independent-living amenities such as space for wheelchairs and emergency call boxes. Residents, who live on federal disability benefits that leave them in the lowest income levels, will be eligible for federal rent subsidies.

The project began when Cohen’s group bought property in Stanton for $265,000, with no assurances of federal support, they said. As in the case of all grants offered by the Department of Housing and Urban Development, Cohen had to compete to win an $800,000 grant. HUD uses a point system to evaluate all applicants and those who have a site get more points.

Until he got the grant, Cohen was unable to pay for consultants to determine the project’s cost. It finally was determined he was $400,000 short.

“You have to spend money before you even know if you can really do the project,” Cohen said.

Cameron, whose organization paid $315,000 for land for 30 units in Midway City, agreed: “As a tiny nonprofit, we really had to stick our neck out. We had to come up with $15,000 [as a down payment] to initiate this process. We didn’t know we would get it back. We were fairly sure.”

HUD grant sums are the same for developments around the country, no matter what the land costs. So in places like Orange County, there is a disincentive to apply, affordable housing advocates argue.

Aretha Williams, who heads HUD’s programs for the disabled nationally, disagreed. She said no applicant has ever been left without a grant after making an investment in property. Applicants do not have to buy property, she added. They can maintain it in escrow or even apply without a site commitment, even though they will not get as many points.

HUD officials also said local and county governments should be asked to “equal it out” when land costs are above the national average.

Cohen said although Stanton officials welcomed the project and helped it through the stringent city planning process, he was unsuccessful in winning financial support from the city.

Community Development Director Mark Lloyd said there was never an official request.

County officials said it is difficult for local governments to dedicate limited resources to the housing projects. However, they point to a new county program that lends money to nonprofits to acquire property for affordable housing projects. That program could help nonprofits get the points to win HUD grants.

Housing officials said there is greater awareness now about the limited housing for low-income families and those with special needs, and that should lead to changes.

“There is very little of this type of housing now, but there are proposals in, and there are proposals being developed,” said Ken Domer, spokesman for the county’s Housing and Community Development. “We’re hopeful that we can see more of this housing in the future.”