City Considering Changes to Affordable Housing Priority Guidelines

The City Council’s Economic Development and Technology (EDTech) Committee will consider a report on proposed changes to the city’s Local Preference and Priority System Guidelines to have affordable housing programs account for the effects of gentrification, according to a city staff report. 

The local guidelines were adopted by the City Council in 2006 to determine the order in which eligible applicants would receive priority to rent or purchase available affordable housing units, including units developed with city subsidies and units created under the lnclusionary Housing Ordinance.

Under the current guidelines, eligible applicants who live and work in the city currently receive the highest priority, followed by applicants who live in the city, those who work in the city, and those who were involuntarily displaced from Pasadena by government action, improper termination of tenancy, domestic violence, participation in the Witness Protection Program, hate crimes, inaccessibility issues, substandard housing, or homelessness.

But the guidelines fail to take into account the ever-increasing cost of housing in the state and displacement caused by gentrification. 

“Recently, however, there has been a recognition among policymakers, stakeholders, and housing advocates that existing local preference policies, while perhaps successful in achieving their stated purposes, have not addressed the impacts of housing displacement created by high housing costs and gentrification,” states a report on the proposal. 

“In response, cities around the nation, including Portland, New York, Oakland, and San Francisco, have revised their policies in order to address such impacts. City housing staff have also evaluated Pasadena’s existing Local Preference Guidelines from this perspective and developed proposed modifications to the Local Preference Guidelines intended to factor in displacement and potential displacement.”

City modifications would include the creation of a 20 percent set-aside of units for former residents of Pasadena. This modification is meant to provide households who were unable to remain in Pasadena, whether due to rising housing costs or gentrification, with the opportunity to return to the city.

“This set-aside would apply to developments with five or more affordable housing units. Under the set-aside, up to 20 percent of the units would be available to households who can demonstrate that they had maintained a primary residence in Pasadena sometime in the 10 years prior to their application for available housing. Within this set-aside, households will receive priority based on length of tenure in Pasadena,” according to the staff report. 

“This means, for example, that a household who had lived in Pasadena for five years prior to application would receive priority over a household who had lived in Pasadena for eight months during the same time period,” the report states.

After that modification, there is an additional set-aside of up to 20 percent which gives preference to residents of deed-restricted affordable housing units in Pasadena who are currently considered over-housed (for example, a single-person household residing in a three-bedroom unit). 

The “over-housed set aside” is intended to address inefficiencies in the match between household size and unit size which occur over time as dependents in larger households move out and will allow such households the opportunity to move to smaller units and pay a lower rent while freeing up larger units for larger income-eligible households.

According to the staff report, “the proposed action is consistent with the city’s General Plan — Housing Element and the Five-Year Consolidated Plan. It also supports and promotes the quality of life and the local economy — a goal of the City Council’s strategic plan.