Laguna Beach to establish local housing trust fund

Laguna Beach continues to work toward ways to drive the development of affordable housing in town, its latest move a decision to form a local housing trust fund.

The City Council adopted a resolution on Tuesday to establish the fund, which came at the recommendation of the housing and human services committee.

Council members approved up to $2.5 million to go toward the fund, a pool of money to further support efforts to provide affordable housing. That includes a combined $1.4 million from housing in-lieu fees and the housing fund.

The move authorized the remainder of the funding gap to be filled by the city’s parking fund on the condition that a state matching grant is awarded. In his motion, Councilman Bob Whalen provided direction that the parking fund be replenished within the next fiscal year.

The state matching grants are for the “creation, rehabilitation or preservation of affordable housing, transitional housing and emergency shelters,” according to the California Department of Housing and Community Development.

The populations given priority in Laguna Beach would be qualifying artists, seniors and members of the local workforce.

The Veterans and Affordable Housing Bond Act of 2018 allows for local housing trust funds to apply for the matching funds from the state, according to a staff report. Laguna Beach has certified its housing element and submitted its annual progress report to the state, making it eligible to apply.

“This is the last year of a five-year cycle for the funding for the Local Housing Trust Fund Grant Program,” said Jennifer Savage, the city’s housing program coordinator. “We don’t know at this time if it would continue. There are regional and state advocacy efforts, but we don’t know whether that will move forward in years to come.”

Savage added the city would have to commit its grant funding to a specific household income target and issue a notice of available funding to make its application competitive. Laguna Beach’s housing trust fund will be required to allocate a third of the funding to households that fall into the extremely-low income tier.

The Orange County Housing Finance Trust puts all of its funding toward extremely low-income housing, Savage said.

Council members balked at the idea of including city-owned property in the notice of available funds. The Ti Amo property at 31727 Coast Highway, which the city purchased in 2021 for civic purposes, was up for consideration.

Joe Hanauer, Cody Engle, Barbara McMurray and Jacquie Schaefgen, all members of the city’s housing and human services committee, addressed the council ahead of its decision.

“As you know, we’ve done next to nothing for well over two decades in terms of expanding housing options in our city, which has boxed out people of modest means,” McMurray said.

Multiple members touted the local housing trust fund as an opportunity to get a “free look” at the state grant program.

“The city’s not committed to do anything if it gets the match,” Hanauer said. “It could look at the conditions of the match, and it could determine if there are adequate places to put this match, and if so, it can move forward. It could decide, ‘We don’t like the terms, we don’t like the conditions.’ It could leave.”

Laguna Beach also approved the establishment of a community land trust geared toward addressing the need for artist housing and work spaces in March.