HomeMy WebLinkAbout05/17/1988, C-7 - POLICY QUESTION WHETHER CITY SHOULD RETAIN OWNERSHIP OF LAND OBTAINED UNDER CITY AUSPICES FOR THE PURPOSE OF LOW- AND MODERATE-INCOME HOUSING MEETING AGENDA /}
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April 20, 1988
MEMORANDUM
To: City Council
From: John Dunn
Subject: P0 ion whether City should retain ownership of land
obtained under City auspices for the purpose of low- and
moderate-income housing
Preliminary Recommendation: Any land that the City obtains for low- and
moderate-income housing, be retained in fee simple title by the City, with
the City granting a long-term ground lease to the San Luis Obispo City
Housing Authority or other appropriate group for the development of the
housing, with the housing itself to revert to the City at the end of the
lease (usually from 20 to 50 years) .
Discussion: The City, as set forth in the Housing Element, has a major
role and responsibility in ensuring that low- and moderate-income housing
is produced, for the benefit of those citizens who are not able to afford
market rate housing. In our situation, most of the actual housing
production is under the auspices of the San Luis Obispo City Housing
Authority. However, the City can meaningfully contribute to the
affordable housing program by obtaining the land for this purpose, which
leaves the Housing Authority the responsibility for producing the
housing. Stated differently, the land cost is subsidized which is one of
the real means of producing housing below the market rate.
Staff recently looked at the situation in the Edna-Islay development where
the developer has set aside land for low-income housing. In that case the
land will be deeded directly to a non-profit corporation affiliated with
the Housing Authority, with a clause for a 50-year reversion of the land
and buildings to the City. In this way, the long-term City goals of
continued affordable housing here are best assured.
The Community Development staff and I have discussed the idea that
whenever land is obtained using either City money or authority, then that
land should be retained in the ownership of the City and ground leased to
the Housing Authority (or conceivably another party, including a private
developer) for the production of housing. The basic idea is that the
future may produce circumstances quite different from those of today, and
the City has greater flexibility, if we own the land and if the
improvements revert to us after a given period of time.
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However, City policy on this matter is not clear and it would be
advantageous to have the City Council indicate its policy direction to the
staff.
I propose to put this matter on the agenda some weeks from now for your
further deliberation and decision. However, in the meantime, I wanted to
let you know of the impending issue, in order to give you an opportunity
to speak to Mike, Toby or me on this subject.
JD:mp
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