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HomeMy WebLinkAbout09 - 2014-2021 Housing Element Update PA2012-104 - Correspondence"RECEIVED AFTER AGENDA PRINTED"' ?lay !3 September 24, 2013 The Honorable Mayor Keith Curry, Mayor of Newport Beach and Members of the Newport Beach City Council City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 RE: Comments on (Draft 2014 -2021 Blousing Element Update (March 2013) Dear Mayor Curry and Members of the City Council: www.kennedycommission.org 17701 Cowan Ave., Suite 200 Irvine, CA 92614 949 250 0909 Fax 949 263 0647 The Kennedy Commission (the Commission) is a broad based coalition of residents and community organizations that advocates for the production of homes affordable for families earning less than $20,000 annually in Orange County. Formed in 2001, the Commission has been successful in partnering and working with Orange County jurisdictions to create effective housing policies that has led to the new construction of homes affordable to lower income work- force families. The Commission urges the City to continue it's leadership and support to encourage and facilitate the development of homes affordable to lower income families through the City's inclusionary housing ordinance. The continued implementation of the ordinance will be a key and effective tool for the City to increase affordable home opportunities for lower income working families. By 2014, the City is projected to have an in -lieu fund balance of $4.5 million from previously approved developments that was subject to the ordinance.' By suspending Chapter 19.54 of the City's Municipal Code (IInclusionary'lousing), it will take away the City's most significant and effective resource to increase housing opportunities for lower income work -force families and special needs families in the City. Although the City has a total Regional Housing Needs Assessment (RHNA) of two for very low - and low- income households, it is important to note that the RHNA is not a maximum ceiling for future development in the City. As indicated in the City's draft Housing Element and prior staff report, the RHNA does not reflect or address the existing housing needs for lower income work- force families and special needs residents living in the City.2 Compared to other cities in Orange County, housing costs are significantly higher in Newport Beach. While the current for -sale housing market is recovering, the costs to rent apartment homes are also on the rise. In Newport Beach, the current 2013 rent for large apartment complexes averaged $2,316 per month and in comparison, the average mortgage for all homes sold in Orange County was $2,028 a month.3 In addition, the City's rent increased by 9.2% from City of Newport Beach City Council Staff Report, Agenda Item 9: 2014 -2021 Housing Element. Update (PA2012 -104), p. 2, Sept. 24, 2013. ' City of Newport Beach City Council Staff Report, Agenda Item 14:.2014 -2021 Housing Element Update (PA2012 -104), p. 6, May 14, 2013. 'Newport Rents Climb $195 a Month, Report Says, Orange County Register, May 2, 2013. Mayor Curry and Council Members September 24, 2013 Page 2 of 2 the year before and had the second biggest percentage increase in the County.4 With wages that are not keeping up with rising rents and lack of affordable homes, many workers and families, especially those who earn lower wages, struggle fmancially to live and work in this City. In Newport Beach, tourism is one of the City's leading industries and it generates substantial revenue and jobs for the City. Of the top 12 principal employers in the City, four provide leisure and hospitality services 5; however, jobs related to leisure and hospitality services, restaurants and retail that greatly contributes to the City's tourism market typically offers lower wages. The average salary for occupations in the tourism market is approximately $22,555 a year,' which is not enough to rent an apartment home in the City without overpaying. With lower wages and high housing costs, many workers in the City have to live and commute from elsewhere, adding to traffic congestion and air pollutants that can negatively impact the quality of life of the community. In 2012, the average commute time to work for Orange County residents was approximately 29 minutes and approximately 82% of commuters drove alone.7 By providing affordable home opportunities near job centers in the City, location accessibility and connectivity will be improved and it will reduce the dependency of lower income households and workers to drive. More importantly, instead of spending money and time on commuting, employees living and working in the City can spend and reinvest their money back into the City. The Commission welcomes the opportunity to continue our dialogue that will result in a healthier and economically competitive community. If you have any questions, please free to contact me at (949) 250 -0909 or cesarc@kennedycommission.org. Sincerely, Cesar Covarrubias Executive Director ' Newport Rents Climb $195 a Month, Report Says, . Orange County Register, May 2, 2013. ' City of Newport Beach Comprehensive Annual Financial Report Fiscal Year Ended June 30, 2012, p. 206, June 2012. `Orange County 2013 Community Indicators, p.17, 2013 'Local Profile of Orange County, SCAG, p. 18, May 2013.