By KIRSTEN LASKEY
Los Alamos Daily Post
kirsten@ladailypost.com
A new strategy is being pursued to expand affordable housing offerings in Los Alamos; rather than building new, Los Alamos County Council agreed to look toward existing housing units.
During the March 25 meeting, it was unanimously approved for the County to pursue a private/public partnership with 9th Street Apartments, LLC. Through this partnership, 24 studio apartment units in the Thunderbird Apartments, 1211 11th Street, and 63 units in the Aspen Studio Apartments, 1027 9th Street, will be deed restricted to qualifying residents making no more than 45 percent of the area median income (AMI) for 20 years.
“I do think this is a good opportunity for the council to work with a private partner to create some affordable housing in Los Alamos and I look forward to other opportunities as this progresses,” Council Chair Theresa Cull said.
However, she urged the County to publicize more information about this project because at first glance it is “somewhat difficult to understand.”
In his presentation, Los Alamos County Housing and Special Project Manager Dan Osborn said, “this project is to provide affordable housing for income-qualified households. The project is proposed and is consistent with the goals established by the County Council and the affordable housing plan and the affordable housing ordinance adopted by County Council, specifically to provide more diverse housing options for low- and moderate-income households.”
He explained that what is being proposed are affordable housing grants that will preserve 87 deed restricted units to qualifying incomes at or below 45 percent of AMI for 20 years. A second grant will fund limited capital improvements for ADA upgrades on the apartment buildings’ first floors as well as other improvements, which include roof replacements, heating, cooling and water system upgrades and parking lot improvements.
Osborn noted that there is a by-right development potential. This acknowledges the potential for infill development to the property.
He added that “this is not a new land use right or guarantee – only a clarification that the deed restriction is limited to the buildings and not to the land. This does not grant the property owner any new rights; as the current zoning exists, the current owners or any subsequent owners would be entitled to come in and replat or otherwise redevelop these parcels.”
Osborn said there are no plans submitted for development.
As far as justification for this project, Osborn reported that in general, rent for a studio or one-bedroom apartment ranges from $1,250 to $2,900 a month. In analyzing the 10 multi-family studio or one-bedroom units in the proximity of the 9th Street Apartments, the rent ranges from $925 to more than $2,900. This doesn’t include a deposit or utilities.
“The short-term goal immediately provides additional permanent, affordable long-term units at a low per-unit cost and is more cost and time effective than constructing new units,” he said.
What affordable housing options exist are in high demand. Osborn said that the Canyon Walk and The Bluffs apartments both have approximately 100 individuals on their waiting lists. The rent on these properties for a one-bedroom unit ranges from $1,200 to $1,500, depending on the tenant’s income. He added that there also is a high demand for housing vouchers. There are 83 individuals holding vouchers and another 124 people on a waiting list. The wait time is approaching almost two years.
“For renters in the 30-60 percent AMI bracket, affordable rents, which is 30 percent of their income, would range from a $1,000 to $1,500 a month, given the lack of available supply of affordable units there’s justified rationale to support the preservation of additional affordable units,” Osborn said. “…by ensuring access to affordable housing, the County can attract and retain essential workers, support our small business community and foster a more stable, economically viable community. Thus, meeting the goals of the community, the council and the (affordable housing) plan.”
He added that the deed restrictions will run with the land and will be transferable should the property sell. The deed restriction is the legal mechanism that ensures the 20-year affordability period will be met.
Total cost to acquire and renovate the apartment complexes is $8.4 million, Osborn said. It will cost $6.1 million to purchase the buildings and another $2.3 million to make capital improvements.
He explained the private partner will bring almost $5 million in private capital, which will be coupled with the housing grant from the County to purchase the deed restrictions. The County will contribute $3.48 million as well as an additional $520,000 in an affordable housing grant for rehabilitation. The total cost to the County, Osborn said, is about $4 million. Broken down, it is $4,000 per unit over 20 years or $2,000 per unit a year or $166 a unit for the life of this project.
“So, for 240 months we would be subsidizing each unit at a cost of about $166 per month to the County,” he said.
As far as rents that would be charged at the 9th Street Apartments, Osborn said for year one through year seven, “I would like to note that those rents are set … by 33-43 percent of the AMI, which is actually below the overall target for the project of 45 percent AMI or less.”
In year eight through year 20, the qualified income will be restricted to at or below 45 percent, he said. AMI in Los Alamos is about $109,000 so to qualify, a person would make $49,000 or less. Rent is set at 30 percent of the qualified income. So, Osborn said, if someone makes $49,000, their rent would be 30 percent of that or $1,233 a month. Rent increases would be limited to 7 percent for tenants who roll over from year seven to year eight.
If tenants make more, Osborn said there will be an off ramp to get into other housing. If renters make more than 45 percent of AMI, they can remain, but they will pay the lesser of 30 percent of their income or market rate. If renters exceed 80 percent of AMI, they will not have their lease renewed and would have two years to find other housing.
Councilor Randall Ryti pointed out during the first seven years, rent increases 5 percent each year and utilities are not included in the rent. It appears that those who make minimum wage wouldn’t see a lower rent for the foreseeable future.
Osborn concurred; saying, “…we have to stand this project up; if we say that tomorrow we are going to qualify everyone at 20 percent of AMI and pay 30 percent of that we would never get this project off the ground. We wouldn’t have the dollars to make the project pencil. So that’s why we locked those in the first seven years ….”
Councilor Beverly Neal-Clinton wondered about the land that could be developed in the future. While nothing has been submitted, Osborn said uses allowed on the land include duplexes, triplexes, small apartments, dormitories and assisted living facilities. He added that any development would have to go through a public process for approval.
The public’s comments on the project were a mixed bag. Some questioned the accuracy of rent prices while others wondered why the County didn’t pursue new construction for affordable housing.
Owner of LA Bootery and Mesa Top Games and Toys Carolyn Cowan said she calculated rent for someone making $12 an hour would be $624 a month. This, she said, was not included in the average monthly rents that would be charged in Osborn’s presentation.
“As a small business owner, I know minimum wage and what we pay our employees has been a point of contention … the numbers that they would be looking at – I’m thinking of my employees and where they live and what their situation is – it would be lower than the numbers that were shown …,” Cowan said.
She said she felt there was a rather large gap between what minimum wage earners could afford and what the new housing project will be charging.
Resident Phil Gursky voiced his support for the project. Preservation of existing low-cost housing stock for affordability is imperative, he said, adding that new construction would be too expensive.
“We should be preserving the affordable housing stock that we have with the renovations they are talking about doing,” Gursky said. “That’s our best option for maintaining the degree of affordability that we can … (this) is absolutely what we should be doing.”