Los Angeles County’s Housing Emergency and Proposed Solutions

Azusa Apartments, Azusa, CA. Photo courtesy of SCANPH.

MAY 2018

Los Angeles County's Housing Emergency and Proposed Solutions

KEY FINDINGS

zz The elimination of redevelopment in 2012 and

zz Los Angeles County needs

exhaustion of state bond funding foreshadowed a

568,255 more affordable rental

26% rise in homelessness from 2016 to 2017.

homes to meet current demand.

zz Low Income Housing Tax Credit housing production in Los Angeles County declined 54% in 2017 in anticipation of federal tax reform.

zz Renters in Los Angeles County need to earn $46.15/hr - more than 4 times local minimum wage - to afford the median monthly asking rent of $2,400.

zz Los Angeles County's lowest-income renters spend 71% of income on rent, leaving little left for food, transportation, health care, and other essentials.

zz When housing costs are considered, Los Angeles County's poverty rate rises from 17.2% to 24.9%.



ELIMINATION OF REDEVELOPMENT & LOSS OF STATE BOND FUNDING FOR HOUSING FORESHADOWED A 26% RISE IN HOMELESSNESS IN 2016-17

60,000

$600

55,000

60,000

Redevelopment

$500 $6

INDIVIDUALS INDIVIDUALS

(IN MILLIONS)

50,000 45,000 40,000 35,000

55,000 50,000 45,000

State Funds Homeless

Redevelopmen2t6% State Funds

Homeless

$400 $300 $200

$100

$5

$4 26%

$3

0,000 0,000

30,000

40,000

$2 $0

200735,0020008 2009 2010

2011

2012

2013

2014

2015

2016

2017

$1

Source: CHPC analysis of 2008-2009 annual HCD Redevelopment Housing Activities Reports; 2008-2009 and 2016-2017 annual HCD Finan-

cial Assistance Programs Reports. Housing and Urban Development (HUD) PIT and HIC Data Since 2007. Note fiscal years are indicated by

second half of fisca3l y0e,a0r 0(e0.g. FY 2006-2007 is presented as 2007).

$0

2007 2008 2009 2010

2011

2012

2013

2014

2015

2016

2017

LOS ANGELES COUNTY NEEDS 568,255 MORE AFFORDABLE RENTAL HOMES

LOS ANGELES COUNTY'S POVERTY RATE 90%RISES TO 24.9% WHEN HIGH HOUSING 80% 80% COSTS ARE INCLUDED

900,000 0,000

800,000 0,000

70%Official Poverty

Ca%lifSoervneiraelyPoverty

6500%%Mea1s7ur.e2(%O985003P%%%M)

CoMsteBausruderene(dCPM)

80% 24.9%

0,000 700,000 0,000 600,000 0,000 500,000 0,000 400,000

Shortfall

VLI (Very Low Income)

ELI (Extremely

Shortfall VLI

40% UHnoaudsjiunsgteCdo7sf0ots%r

Adjusted for Housing Costs

and Social Benefits % Severely

30So%urce:

Poverty

PbuybCliocuPnotyli6cay0nId%nsLteitguitsela2ot0ifve%CaDliifsotrrinc5ita,32(%P0P13IC-2),0C15a.liforniCa ost

Burdened

20%

50%

1L0O%PWROINDCUOCMTI4EO0HN%OINUSLIONSGATNA6GX%ECLREES1D.4CI%TOU(LNIHTTYC)

0% DECLINE3D0%54% IN ANTICIPATION OF ELI FE2DV0L%EI RAL TLIAX REMFodORAMbo2ve0M%od

0,000 300,000

Low Income) (Very Low Income)

10% Type

0%

State 2016

2017

6% Change %

1.4%

0 200,000

Renter Households

100,000

A ordable and Available Rental Homes

(LEoxwtIErnIeLcnmoCIcmooAeMumvleyneeeNtrdya)eiMgaeoenidfneALAimdossskkutioimAnAngNgAncWgqeRReawuoeelgriennsdeCsttitoiAon$$2ns,81l4l,t,900&r9u003Rc0//LtMeM/iooMhoonsonantnthbhAthnEg12L9e5I4,l,2e0,38s31572C$o11Vu.5Ln157I03t,,/4,y93H02o3u875r LI

-20%Mod Above -61%

-45%

Retail SalespersMoendsiTayn$p2A,e0s4k2in/gMoRntehnt 220,1460$01/1M.7o28n0/tHh1o7ur Change %

New Construction 1,853 1,456

-21%

0 Renter A ordable

Janitors &InCcAloecmAaqnveueeiNrrssaietgeioe$dn2eA,d4&s4ktRi4one/gAMhoaRnbotehrndt 3,$289,2000/$M18o4n9.t11h0/Hour -73%

Households

and Available Rental Homes

Nursing

AssCisotaunnttsy oA$f2lLl,4o4s 6A/Mngonethles Minimum Wage

5$,114,9593/M$2o1,n34th4.117/Hour

-54% $11.50/Hour

Source: CHPC analysis of 2016 and 2017 CA Tax Credit Allocation

Source:

CHPC

analysis

of

2016

PUMS

data

using

adapted

Teachers

NLIHC

&

InsCNtooumtcemtRtohietretstedaeai(tl$aTSC3daA,o0Clee2s)s7dnpao/Mtetaior.nsnctolhundse

ma$n2ag,0er4o2r/mMaornkteht

ra$te17h.o4m6e/Hs $ou1r1.78/Hour

methodology.

Construction WcreoartkeJedartnshirtoou$rg3sh,3&th7e4CL/lMIeHoaTnCntheprrosgra$m2. ,444/Month

$19.47/Ho$ur14.10/Ho

$0

$1,000 $2,000 $3,000 $4,000 $5,000

Nursing Assistants $2,446/Month

$14.11/Ho

)

mely come)

0%

ELI

VLI

6% 1.4%

LI

Mod Above Mod

RENTERS NEED TO EARN 4 TIMES MINIMUM WAGE TO AFFORD MEDIAN ASKING RENTS

Median Asking Rent 2,400/Month

Income Needed to A ord Average Asking Rent

County of Los Angeles Minimum Wage

$8,000/Month $1,993/Month

Retail Salespersons $2,042/Month

Janitors & Cleaners $2,444/Month

$11.50/Hour $11.78/Hour

$14.10/Hour

$46.15/Hour

Nursing Assistants $2,446/Month

$14.11/Hour

Teachers & Instuctors $3,027/Month

$17.46/Hour

Construction Workers $3,374/Month

$0

$1,000

$2,000

$19.47/Hour $3,000 $4,000 $5,000

$6,000

$7,000 $8,000 $9,000

Source: Paul Waddell, Urban Analytics Lab, University of California, Berkeley, retrieved from analysis of online Craigslist listings in April 2018.

CHPC analysis of Bureau of Labor Statistics Median An$n6u0al0Wage Data for CA Occupations in 2017.

WHRAeTdevDelOopment LOSStAaHtoeNmFGuenleEdsssLES COUNTY'S

RENTERS HAVE

LEFT OVER

AFTER PAYING

$500

HOUSEHOLDS EARNING HALF OF MEDIA$4N00INCOME OR LESS

(IN MILLIONS)

26% $300

Food,

Transportati$o2n0, 0 Health Care,

& Other Ess$e1n0t0ials

29%

Rent

71%

RENT?

$0

011

2012

2013

2014

2015

2016

2017

MEDIAN INCOME HOUSEHOLDS

Food, Transportation, Health Care, & Other Essentials

72%

Rent

28%

Source: NLIHC analysis of 2016 PUMS data.

PERCENTAGE OF SEVERELY COST BURDENED* HOUSHOLDS BY INCOME GROUP

90% 80% 80%

70% 60% 50%

% Severely Cost Burdened 53%

40%

30% 20%

20%

10%

0%

ELI

VLI

6% 1.4%

LI

Mod Above Mod

Source: NLIHC analysis of 2016 PUMS data *Severely cost burdened households spend more than 50% of their income towards housing costs.

Median Asking Rent 2,400/Month me Needed to A ord Average Asking Rent $8,000/Month ounty of Los Angeles

ABOUT CHPC

THE STATE CREATED THE CALIFORNIA HOUSING PARTNERSHIP NEARLY 30 YEARS AGO AS A PRIVATE NONPROFIT ORGANIZATION WITH A PUBLIC MISSION: TO MONITOR, PROTECT, AND AUGMENT THE SUPPLY OF HOMES AFFORDABLE TO LOWER-INCOME CALIFORNIANS AND TO PROVIDE LEADERSHIP ON AFFORDABLE HOUSING FINANCE AND POLICY. SINCE 1988, THE CALIFORNIA HOUSING PARTNERSHIP HAS ASSISTED NONPROFIT AND LOCAL GOVERNMENT HOUSING AGENCIES ACROSS THE STATE TO LEVERAGE MORE THAN $14 BILLION IN PRIVATE AND PUBLIC FINANCING TO CREATE AND PRESERVE 70,000 AFFORDABLE HOMES.

$46.15/Hour

STATEWIDE POLICY RECOMMENDATIONS

The California Housing Partnership calls on state leaders to take the following actions to provide relief to low-income families struggling with the high cost of housing:

?? Immediately invest $1 billion of the state's budget surplus to finance the development of permanently affordable rental housing and another $1 billion for supportive housing for the homeless.

?? Bring back redevelopment funding for affordable housing and related infrastructure at an initial amount of $1 billion annually.

?? Aggressively campaign for the passage of the $4 billion Veterans and Affordable Housing Bond of 2018.

?? Reduce the threshold for voter approval of local funding of affordable housing and infrastructure from 67% to 55%.

LOCAL RECOMMENDATIONS FOR LOS ANGELES

?? Adopt a county inclusionary housing policy as directed by the Board of Supervisors. ?? Provide adequate funding to acquire and preserve existing affordable rental housing at-risk of

conversion to market.

?? Create a shallow project-based operating subsidy to enable households with incomes below 30% of AMI who do not qualify for other rental subsidies to access affordable housing.

?? Update local funding programs to take advantage of a change enacted by the March 23rd federal spending bill that allows households with a wider range of incomes (including some of the so-called "missing middle") to live in developments financed by Low Income Housing Tax Credits.

?? Acquire and reserve land for affordable housing development, particularly in current and emerging high-opportunity areas.

?? Adopt an affordable housing entitlement streamlining ordinance similar to the ordinance recently adopted by the City of Los Angeles to expedite the development of supportive housing.

?? Expand and strengthen protections against unjust evictions by adopting new tools including just cause eviction and rent control policies.

?? Increase funding for comprehensive tenant outreach and education in multiple languages and prioritize these resources in areas most likely to experience displacement.

This report was produced by the California Housing Partnership. Local policy recommendations provided by: Southern California Association of Nonprofit Housing For questions about Los Angeles County's housing need, contact: Alan Greenlee, agreenlee@, 213-480-1249

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