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Planning Chief Says There’s Nothing Stopping Churches From Pursuing Housing Projects On Their Property

Published on Monday, July 26, 2021 | 5:00 am
 

Pasadena Planning Director David Reyes said there is no law or General Plan element restricting churches from building housing on their properties.

“There is nothing that currently prevents any religious institution from pursuing the development of affordable housing on property it controls,” Reyes wrote. 

However, “Any such project would be reviewed against current zoning to determine what approvals would be necessary for such a project to proceed,” he said.

At least one church is not waiting for the city to pass such an ordinance. 

Developers want to build a 110,503 square-foot, 162-unit, five-story residential care, general facility building with two levels of subterranean parking on property owned by the First Church of Christ, Scientist on the southeast corner of Green Street and Oakland Avenue. 

The City Council was scheduled to hear a predevelopment plan on that item last Monday, but the item was pulled and held for a future meeting.

Other churches are also moving forward with their building plans in nearby areas.

Logos Faith development is currently working with seven other churches in the L.A. area to help them redevelop their land for similar mixed-use, community-oriented purposes.

A religious institution housing ordinance is identified in the draft housing element as an implementation objective under the alternative housing opportunities program. 

It is one of four objectives that are identified to be completed by 2025. 

“This does not mean that staff intends to wait to 2025 to pursue this effort,” Reyes wrote. “Once the City has adopted the 2021-2029 Housing Element, which is anticipated to occur in December 2021, staff plans to immediately proceed with the Religious Institution Housing Ordinance.” 

Other objectives include:

  • Investigating how the city or a partner organization may serve as the property manager for property owners who construct accessory dwelling units (ADUs) but wish to have a low-cost option for managing the rental. 
  • Reviewing the current ADU standards and evaluate how best to amend the ordinance to reflect state law while maintaining the character and quality of residential neighborhoods. 
  • Working with Caltrans to target the sale of Caltrans I-710 properties for creative housing types for lower-income and special needs households.

Building housing is recently being seen as a way out for many churches mired in debt.

In the early part of the last century, monolithic churches were built with huge parking lots to accommodate large congregations. But now, many of those churches are struggling to fill the pews, which has resulted in less money going into church coffers. 

Bloomberg News last year reported that about a third of U.S. congregations surveyed between 2018 and 2019 said they have no savings. 

Making matters worse, church donations plummeted during the pandemic. 

According to the Barna Group, an evangelical research firm, as many as one in five churches in the U.S. could close over the next 18 months.

By 2006, church borrowing had reached $28 billion nationwide, with that debt leading to an increase in church foreclosures after the financial collapse of 2008, according to Reuters.

The median balance on that debt being carried by 26% of the nation’s religious institutions was $170,000, and a majority of congregations had less than $100,000 in annual income.

According to the CoStar Group, a real estate information service, in 2011, 270 churches were sold after defaulting on their loans. In those situations, 131 were sold by banks themselves as opposed to the church property owner. 

The highest percentage of foreclosures have been in the same states that have suffered from rampant home foreclosures — California, Georgia, Florida, and Michigan. 

It was not immediately known how many local churches are pushing to build housing to reduce their debt.

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