In the short term, since we cannot simply build our way out of the housing crisis, we must find ways to create synergies between building new housing and preserving the housing that is already here. While we work to increase moderately-priced rental and homeownership opportunities, we also need to preserve our existing housing stock through diligent code enforcement and targeted rehabilitation. Following are brief descriptions of the City of Los Angeles' housing preservation programs. Information on loan programs to help preserve housing can be found at www.lacity.org/lahd.
Code Enforcement. The Systematic Housing Code Enforcement Program (SCEP) was created to ensure that older apartment buildings in Los Angeles, which provide affordable places to live for many people, are maintained in decent condition. The SCEP program, which is administered by the Los Angeles Housing Department, inspects every property in the city with two or more rental units on a regular schedule (about every five years). Inspectors will issue correction orders to property owners when they find conditions that violate the City's housing codes. Building owners then have four months to comply with the order.
In addition to the regular inspections, the Housing Department responds to complaints about building conditions by tenants, owners or other public agencies. Complaint inspectors usually respond within 72 hours. Property owners who fail to comply with correction orders may be placed in the Rent Escrow Account Program (REAP). Under this program, tenants pay their rents into a rent escrow account until all ordered building repairs are completed.
Affordable Units at Risk of Losing Their Subsidies. In addition to the affordable rental housing units owned and operated by nonprofits and the public housing units owned and operated by HACLA, there are about 24,500 privately owned affordable rental housing units in the City with federal subsidies. Many of these programs allow owners to withdraw from the programs and convert their properties to market rents. So far, 3,525 affordable units have lost their affordability restrictions because their owners have paid off subsidized mortgages or withdrawn from Section 8 contracts.
According to the City's estimates, 41 percent of the City federally assisted units are at risk of losing their affordability between 2002 and 2006. Another nearly 2,000 units could lose other types of subsidies and convert to market rates.
Type of subsidy |
Number of Units |
|---|---|
Federally-insured Mortgages - or - Project-based Section 8 Rental Subsidy |
10,080 |
Restricted by Low-Income Housing Tax Credit Program |
380 |
Restricted by other sources (Tax-exempt bonds, CDBG, HOME, Tax increment and Density bonus/Land use restrictions) |
2,000 |
TOTAL |
12,460 |
Under California law (Govt. Code 65863.10), owners who wish to stop participating in federal subsidy programs must give notice of their intentions to tenants, local public agencies and the California Department of Housing and Community Development. The owners must give two notices: one 12 months before taking any action; and another at 6 months before taking action. Furthermore, anyone who is committed to preserving the affordability must be allowed to make an offer to purchase the property.
City of Los Angeles Preservation Program. In fall 2004, the City of Los Angeles approved a preservation program that will:
- Require apartment owners to notify residents similar to the State's preservation ordinance;
- Include guidelines for providing City financing for preserving affordable housing;
- Include guidelines for facilitating ownership transfers to preserve affordable housing; and
- Create a new Preservation Coordinator position to manage the preservation program who would be responsible for:
- Portfolio Management
- Tenant Outreach and Education
- Enforcement of the Rent Stabilization Ordinance (RSO) and related City ordinances when applicable. (Buildings subject to the RSO that terminate affordability restrictions are still subject to Rent Stabilization)
- Monitoring preservation regulations and legislation.
For more information on the City's Preservation Program, visit the LAHD website. To contact the City's Preservation Coordinator, Franklin Campos, call (213) 808-8654.
Rent Stabilization. The purpose of the City's Rent Stabilization Ordinance (RSO) is to protect tenants from excessive rent increases while allowing property owners a reasonable return on their investment. The ordinance, which was enacted in 1979, is administered by the Los Angeles Housing Department's Rent Stabilization Division.
The annual allowable rent increase is based on the Consumer Price Index (CPI) average for the Los Angeles – Long Beach – Anaheim areas for a 12 month period ending September 30 of each year (LAMC 151.07 A6). Under the RSO, the percentage can be no lower than three percent (3%) and no higher than eight percent (8%). A landlord may increase rent by the approved percentage once every 12 months. The landlord is required to give tenants written notice 30 days before increasing the rent. Additional rent hikes are permitted under certain circumstances. Details on the rules for rent increases can be found in Rent Stabilization Bulletins on the LAHD website.
The ordinance applies to all rental properties of two or more units constructed before October 1, 1978. The ordinance controls rent increases for existing tenants. Landlords are able to raise rents to market prices when an apartment is vacated and rented to a new tenant. However, rent increases for the new tenant will again be limited to those approved by the Rent Adjustment Commission.
If landlords do not maintain their properties, tenants may apply for a rent decrease.
