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No Reliable Data to Support Key Housing Number

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By Jorge Casuso

February 14, 2023 -- How many of Santa Monica's nearly 27,500 rent control households pay more than 50 percent of their income in rent, making them "severely rent-burdened"?

Although the number is used to approve City policies, establish financial support programs and pass tax measures, the answer ranges wildly:

From less than 500 (the number who qualify for rent relief under a new City program) to more than 6,000 (the number used to support former mayor Sue Himmelrich's transfer tax hike) to more than 10,000 (the number the City uses to approve policies).

The City of Santa Monica’s Assessment of Fair Housing (AFH) report released in 2020 seems to provide a definitive answer.

"There are 10,225 households in Santa Monica experiencing severe housing cost burden, of which 2,930 of these households are families," the report states.

But when asked by Audit Subcommittee Vice Chair Marc Verville if "the affordability data being used" was accurate, City officials acknowledged it was "imperfect."

"HUD data and resident survey responses inform our strategies," City officials responded. "And while the data may be imperfect, it is the best data we have.

"It would be expensive and resource-intensive to develop our own data. The value of creating our own data is unclear in terms of addressing the challenges." (see responses to Verville's questions).

The lowest estimate of severely rent-burdened tenants -- fewer than 500 -- reflects the number of applicants who will ultimately receive financial aid under the City's widely publicized Rent Control Adjustment Relief Program.

Despite extensive outreach to Santa Monica's 27,484 rent control households, 450 applicants were awarded relief to offset the current 3 percent increase in the annual rent adjustment, according to City data.

The application period -- which ran from August 29 to September 19, 2022 -- was reopened from December 12 through January 11 ("City Extends Rent Relief Program After Fewer Than 500 Households Qualify," December 15, 2022).

The extension was meant for tenants who received a rent increase notice after the original application deadline, or "experienced extenuating circumstances (such as an illness) and were not able to apply during the initial round," said City spokesperson Tati Simonian.

A total of 50 applications were received and are being processed, Simonian said.

"Outreach for the program included promoting the program through the City’s electronic newsletters and social media in addition to numerous postal mailings to every rent-controlled tenant to inform them about the program and how to apply," she said.

"Rent-controlled tenants also received information about Measure RC after the voters had passed the measure" that caps increases at 3 percent, Simonian said.

The number of qualifying tenants represents about 7 percent of the 6,555 households sponsors of Measure GS calculate pay more than 50 percent of their income in rent.

That was the number used in a power point chart to sell Himmelrich's successful $56 per $1,000 transfer tax hike for properties that sell for $8 million or more to fund affordable housing, homelessness prevention and public schools.

According to the power point presentation, "There is a severe housing affordability crisis for low-income Santa Monica residents."

The highest estimate -- the 10,225 households used by the City -- comes from HUD’s Comprehensive Housing Affordability Strategy (CHAS) data based on the American Community Survey (ACS) conducted by the U.S. Census.

Verville notes that the National Library of Medicine, a division of the National Institutes of Health, "has evaluated the ACS data to be extremely unreliable to the point of unusability."

This issue is especially relevant for small areas such as Santa Monica, he said.

The ACS and HUD data, Verville said, "are not corroborated by any other available City data."

"That means that major City policies and resource allocations are being made on an unquantified problem."

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