The Pasadena City Council has approved the terms of the Public Benefit Agreement with the California Statewide Communities Development Authority (CSCDA) for the acquisition of an apartment property for conversion to workforce housing.
During its meeting on Monday, members of the Council voted unanimously to approve the agreement that seeks to convert the 105-unit Theo apartment located at 289 North El Molino Avenue to housing for middle income workers or those earning between 80 and 120 percent of area median income or AMI.
The CSCDA is an agency that works to create low and moderate income housing opportunities. As a member of the CSCDA, the City has the ability to approve acquisition of housing units by the CSCDA, for conversion into affordable housing by entering into Public Benefit Agreements.
By entering into the said agreement, the city would be participating in the authority’s workforce housing program, through which government bonds are issued to acquire market-rate apartment buildings.
The agreement on the acquisition of the Theo apartment will require the City to forego property tax revenues amounting to $3,608,600 generated from the multifamily rental development for the 30-year period from fiscal year 2022 up to 2051.
Under the agreement, the City will have no financial or legal obligation for the tax-exempt status of the CSCDA, the debt service obligations carried by the CSCDA, nor any other matters related to the CSCDA and its projects.
The agreement also states that the City has no initial ownership in the project. However, it maintains an option to force a sale or refinance the project starting year 15 following the acquisition.
During the meeting, Councilmember Tyron Hampton expressed his support for the approval of the agreement.
“This brings us some definitely needed housing, which is workforce housing.”
“We do lose some tax revenue but at the end of the day we look at that and say that’s a drop in the bucket in comparison to what it would cost us to build those homes,” Hampton said.
Councilmember John Kennedy also expressed his support for the proposal. “With this effort, as we have done in the recent past, we are going to bring on more affordability for our community. I am supportive of this action,” Kennedy said.
In a letter to the Council, Linda Vista Annandale Association President Nina Chomsky wrote that “This form of Affordable housing is needed for Pasadena’s teachers, public safety personnel, medical personnel, City and other government employees, and other, similar essential ‘middle’ workers. We also like the fact that there will be no need to build new, out of character and out of scale buildings to provide these units.”
Last May 24, the City approved the terms of Public Benefit Agreement for the CSCDA’s acquisition of the Hudson apartments project located at 678 E. Walnut Street and the Westgate apartments project (Phases 2 and 3) located at 231 S. Delacey Avenue.
These projects total 513 affordable workforce housing units.