SR 12-13-2022 8A
City Council
Report
City Council Meeting: December 13, 2022
Agenda Item: 8.A
1 of 1
To: Mayor and City Council
From: Denise Anderson Warren, City Clerk, Records and Election Services
Department
Subject: Request of Councilmembers Parra, Brock and de la Torre to direct the City
Manager to evaluate the impacts and feasibility of changing the Santa Monica
Housing Authority Payment Standard basis to Small Area Fair Market Rate
and increasing select zip code/unit size categories to 120% SAFMR to
mitigate negative impacts as recommended by the Housing Commission by
mid-December. (CONTINUED FROM 11/29/2022)
Prepared By: Esterlina Lugo, Deputy City Clerk
Approved
Forwarded to Council
Attachments:
A. ADD-TO: HC Report and Recommendations for SMHA Payment Standard
Changes Oct 2022
B. Written Comment
C. Written Comment
8.A
Packet Pg. 462
1
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
Housing Commission
26 October 2022
Mayor Himmelrich and City Council Members
1685 Main Street
Santa Monica, CA 90401
Dear Santa Monica City Council,
The Santa Monica Housing Commission voted on 6 October 2022 to advise the City Council and
Housing Authority Board to direct Santa Monica Housing Authority (SMHA) staff to do the following
by the January 2023 Department of Housing and Urban Development (HUD) deadline for such
actions:
1. Change the SMHA Housing Choice Voucher (HCV) payment standard basis from an exception
to the Fair Market Rate (FMR) to the Small Area Fair Market Rate (SAFMR) with some
corrections, and
2. Increase SMHA HCV payment standards to reflect current market rents, using available
discretionary measures.
Recommendation 1
The Housing Commission strongly advises changing the HCV payment standard from the greater
Los Angeles area metro Fair Market Rate (FMR) for several reasons:
A. The LA metro FMR is historically significantly lower than the FMR in Santa Monica1; it is not a
logical basis from which to begin determining a payment standard for Santa Monica.
B. Because the LA metro FMR is inadequate for Santa Monica, SMHA must deviate from the metro
FMR by utilizing a HUD exception to increase payment standards accordingly. In 2016 that
exception was approximately 175% of the metro FMR for a two bedroom unit.
C. Continuing to bridge the discrepancy between the metro FMR and Santa Monica rents with an
exception from HUD gives an artificially and inappropriately low baseline that contributes to
1 See https://www.huduser.gov/portal/datasets/fmr.html for Los Angeles-Long Beach-Glendale, CA HUD Metro FMR Area;
https://www.huduser.gov/portal/datasets/fmr/smallarea/index.html for Santa Monica zip codes 90401-90405.
8.A.a
Packet Pg. 463 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
2
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
unfair housing practices. Disability accessible housing is difficult to find, especially in Santa
Monica. Where it does exist, it tends to be more expensive than average units. However,
disabled, low income Santa Monicans are uniquely prevented from receiving a payment
standard increase as a reasonable accommodation of disability, despite the ubiquity of this
practice nationwide, because HUD caps PHA approval of such exceptions at 120% of the metro
FMR2, which the SMHA payment standard already exceeds with the HUD exception. While HUD
may approve a payment standard above 120% as a reasonable accommodation3, such
approvals are rare, and usually do not exceed 140% metro FMR4, which the SMHA payment
standard also already exceeds with the HUD exception. Therefore, a metro FMR payment
standard basis for SMHA payment standards uniquely discriminates against disabled and low
income Santa Monicans, preventing them from securing accessible local housing.
The Housing Commission strongly recommends changing the SMHA HCV payment standard basis to
the Small Area Fair Market Rate (SAFMR) for several reasons:
D. SAFMR, unlike the metro FMR, defines fair market rate by individual zip code5 instead of the
average of all zip codes across a large region. By definition, it is tailored to the actual housing
prices in the City of Santa Monica, zip codes 90401-90405.
E. SAFMR does not require a HUD payment standard exception to mitigate a fundamentally
inaccurate metro FMR.
F. The National Housing Law Project (NHLP) and Poverty and Race Research Action Council
(PRRAC) recommend SAFMR as best practice across housing jurisdictions because it is
granular, and therefore more fair and efficient. Payment standards based on SAFMR raise or
lower those based on metro FMR according to hyperlocal housing costs, resulting in payment
standards that are neither too high nor too low for an area.6
G. Because a SMHA HCV payment standard based on SAFMR may be raised to 120% SAFMR by
the PHA as a reasonable accommodation of a disability, and higher if necessary with HUD
approval, disabled, low income Santa Monicans will be provided with more equal access to
housing via SMHA programs, as required by federal law.7
Furthermore, the Housing Commission recommends that SMHA ask HUD to reevaluate the listed
SAFMR for zip codes 90404 and 90405, which are lower than actual market rates in those areas due
2 24 CFR § 982.505(d).
3 24 CFR § 982.503(c)(3).
4 Personal communication with HUD staff, late 2021.
5 https://www.huduser.gov/portal/datasets/fmr/smallarea/index.html
6 https://prrac.org/wp-content/uploads/2018/07/NHLP_PRRAC_Voluntary_SAFMR_One-Pager.pdf
7 https://www.hud.gov/program_offices/fair_housing_equal_opp/disability_overview
8.A.a
Packet Pg. 464 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
3
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
to insufficient data. While this request is important to ensure the federally determined SAFMR is
accurate throughout Santa Monica, it need not delay or immediately impact the Housing
Commission’s other recommendations, as there are discretionary corrective measures available to
SMHA to make minor adjustments to SAFMR in select zip codes, as detailed below.
Recommendation 2
In addition to changing the SMHA HCV payment standard basis from a broad and inaccurate metro
area FMR to a granular and custom SAFMR, the Housing Commission also strongly recommends
SMHA raise the resulting HCV payment standards to accurately reflect current Santa Monica market
rents. This is crucial for several reasons:
A. Adequate HCV payment standards are required to ensure issued HCVs can be utilized at all.
Santa Monica’s outdated payment standards currently make it difficult for SMHA program
participants to find habitable housing to which they can apply their HCV8.
B. Adequate HCV payment standards are required to ensure SMHA program participants can
utilize their HCVs across the city, not just in the Pico and Downtown neighborhoods, particularly
areas lining I-10, where they are currently concentrated. Such housing mobility affirmatively
furthers fair housing as directed by HUD.9
C. The primary data underlying annual SAFMR determinations by HUD are 2-6 years old10.
Therefore, annual SAFMR listings will always be somewhat out of date, potentially requiring
Public Housing Authorities (PHAs) to make discretionary adjustments to account for current
market rents.
D. In times of economic and social upheaval, such as the prolonged coronavirus pandemic,
market rents may shift more than usual, requiring local correction to ensure HCVs remain
usable.
Changing the SMHA payment standard basis to a SAFMR model, as the Housing Commission strongly
recommends, would increase the payment standards for each Santa Monica zip code as indicated in
Table 2 below, except where highlighted in yellow. These highlighted portions show problematic
impacts, mostly on the Pico Neighborhood.
8 Personal experience and hundreds of personal communications, 2021-2022.
9 https://www.hud.gov/AFFH
10 https://www.federalregister.gov/documents/2022/09/01/2022-18905/fair-market-rents-for-the-housing-choice-voucher-
program-moderate-rehabilitation-single-room
8.A.a
Packet Pg. 465 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
4
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
Based on data and recommendations submitted to the Housing Commission by Denise
McGranahan, Senior Staff Attorney at the Legal Aid Foundation of Los Angeles (LAFLA), Santa
Monica Office11, the Housing Commission strongly recommends the following additional changes to
address concerns about the 90404 and 90405 zip codes:
In addition to changing the payment standard basis to SAFMR, increase payment standards for the
zip codes and unit sizes highlighted in yellow in Table 2 (1-4 bedroom units in 90404; 2 bedroom units
in 90405) to 120% SAFMR as indicated in the figures in Table 2 highlighted in green.
Table 1: Current SMHA payment standards based on metro FMR, unchanged since 201612
0 Bedroom 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom
Table 2: Santa Monica payment standards at 100% SAFMR by zip code, with 120% SAFMR for
negatively impacted unit sizes in 90404 and 9040513
Zip Code 0 Bedroom 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom
90401 $2210 $2520 $3200 $4160 $4570
90402 $2020 $2300 $2930 $3810 $4180
90403 $2260 $2580 $3280 $4260 $4680
90404 $1620 $ 1850 $ 2350 $ 3050 $ 3350
90405 $1820 $2070 $ 2630 $3420 $3750
120% SAFMR
90404 — $ 2220 $ 2820 $ 3660 $ 4020
120% SAFMR
90405 — — $ 3156 — —
11 Correspondence from Denise McGranahan, Senior Staff Attorney at LAFLA, Santa Monica Office, 6 October 2022.
12 https://www.santamonica.gov/housing-payment-standard%5C
13 Correspondence from Denise McGranahan, Senior Staff Attorney at LAFLA, Santa Monica Office, 6 October 2022.
$1512 $1930 $2640 $3366 $3366
8.A.a
Packet Pg. 466 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
5
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
Agencies in any metropolitan area that voluntarily adopt a SAFMR payment standard basis have the
option to set payment standards for any or all of the ZIP codes they serve, simply by notifying HUD by
email. Furthermore, as with exception payment standards, housing authorities can increase
payment standards to 120% SAFMR through December 2023 with field office approval.14 The Housing
Commission strongly recommends the latter action, increasing the payment standards in the zip
codes and unit sizes highlighted in yellow to 120% SAFMR.
City staff have and continue to argue that raising the SMHA payment standard will reduce the total
number of vouchers in Santa Monica. This argument is problematic for several reasons:
1. It is disingenuous to denounce relatively fewer vouchers when SMHA does not issue all of the
vouchers they currently have.
2. It assumes SMHA is permitted a finite number of vouchers, which is inaccurate. The federal
government has increased, and has announced it will continue to increase, HUD spending,
making more vouchers available; SMHA only has to request them.
3. Many SMHA HCV holders already occupy units with contract rents that exceed current
payment standards. These low income Santa Monicans are leaving and will continue to leave
Santa Monica because insufficient payment standards force them to pay the ever increasing
difference between the voucher value and the contract rent, resulting in widespread rent
burden that often exceeds 50% of program participants' income.
4. Finally, and perhaps most importantly, a higher number of SMHA vouchers with payments
standards too low to utilize in Santa Monica are worthless. Program participants must find an
apartment to rent for less than the payment standard amount within a fixed timeframe or they
lose their vouchers. Those forfeited vouchers are subsequently issued to others, who face the
same difficulty using them, and so on. Higher numbers of unusable vouchers cannot be
preferable to lower numbers of usable vouchers.
The Santa Monica Housing Authority payment standards are counterproductively outdated and low.
Furthermore, the poorly correlated metro FMR payment standard basis poses several challenges.
Fortunately, HUD provides a clear solution for cities like Santa Monica, where SAFMR based payment
standards may be adopted and adjusted as needed, thereby more closely aligning payment
standards with the precise local market rents to which they must apply.
Santa Monica has an opportunity to demonstrate, and include in annual SMHA reporting, its active
efforts to increase HCV utilization and affirmatively further fair housing. Please ensure this vital
progress by directing staff to adopt the Housing Commission recommendations detailed above with
14 Correspondence from Denise McGranahan, Senior Staff Attorney at LAFLA, Santa Monica Office, 6 October 2022.
8.A.a
Packet Pg. 467 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
6
1685 Main Street, Santa Monica, CA 90401 • (310) 458-8411 • ccs.mailbox@santamonica.gov
santamonica.gov • @cityofsantamonica • @santamonicacity
haste, and before all relevant HUD deadlines for 2023 implementation of such changes. Thank you in
advance for your consideration of this increasingly urgent matter for thousands of low income Santa
Monicans.
Sincerely,
Michelle Gray
Chair, Santa Monica Housing Commission
On behalf of the entire Santa Monica Housing Commission
8.A.a
Packet Pg. 468 Attachment: ADD-TO: HC Report and Recommendations for SMHA Payment Standard Changes Oct 2022 (5513 : Housing Authority Small Area
EE v, T 'rs. ' a $Item 16.E 11/15/22
1 of 4 Item 16.E 11/15/22
8.A.b
Packet Pg. 469 Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)
*
s(\
NoN'ut
=o
;.$
33
&c-)
q-b
$
6'
q
as-t
s
B
3
,s
Rf.
6f'
5
R
oXr)o
E"
+
o
-x
h
o
\?
s
\-)
a
\$
N-
D'
B-
Erb-)
.s
-J-
-.OPG
S\9
-T1
20
S
o'
ss
rD
S.o
N
e
$_
+
I
*
o
De
3F
E+'5o
-+
1-cv
a+
B
F
a\
-1)
d
F
6'
-TosSs
N-
dt"
d
6'o
+J
r$
(A
dt
R"s
s
$*n+s1q+t
3
il
\$
d
B$
Tl
=.D
oT
--to,
+5n
(n
3
P_
>
{_
F
sxD>
F'
g
;0I
ao{-
3s
cro
sf,
Jf\(nt,I-f
sf,
o_
o
L^t)
(^c
RN
il$>.
+.G.'.T
-o
s3
8--)
ot
db
V)DJ(n
H:
NI
O.
-J*s\l
s
\
d\
R"
$
o\o
)s
TI
=
E
Fno
+o-\-t
o-b
:h
6'
o-b
oc-)
osfd:-.l
\Ysftf,
hf
r0xo(D
(o
n_
-l-:rn
o
te
'Tt
:3x
f,a-
-ah
's
:
I
o\
ctt
bs
-\)-Toc$
d
3
-ro
.s+
6'
-\lAJ,
C+
^:'t^d$
5'
.s
t
di(^-+)
g
:>+
€
J
dJ.-rls
x,3g
Stn
a-h(/)
-L$s
+
rD
o
;.9
-Tr
-->3
sg;:; i=g
tg8 5'+H e
iss$3:B
i*t$i$
$$$g*g
$* $${$1
i$*3F*
s
=^=
=r(\-t
-*rUoNt\)
dHHFsT ti,po
Rs sEl
eg $f3
R T *8.€
$:N * +S
&* $$$
i-$ fi$Ii$5-iaqb $6
$s ii$t ni^\s( \^
.R
--
\
(l,
s-ta
F
B-5
s_
s-f
R
o=
ao
rs
-I'
oq
N+(n,
s-l')s
N-to
tt
\
o
N)
EB
Sp-)Item 16.E 11/15/222 of 4Item 16.E 11/15/228.A.bPacket Pg. 470Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)
,SBverely rent-rmrw-1ec/_; qss&f/ve} oufreach 7l> fhese po.r-ti'c1pan"ts-o.nd offer +hem fhe -Fa.mi/y l-¼t'ver 120,Z Fm R po:yment
FinaJljJ o,r,d ,h fhe f('eo.f)f/me; Hoiu;in.3 ,S'faff could
return ·tc. --I-he H()u.sf1>.3 Cotnmission 10 fhe near f'qt()re ·-for o. mor_e +ho43hff't1/ c/fscussion wil-h housir:9 bllrden/' por-t-out d0i-/q 0ind To .su.gge�f various opftdh<5; -fqking{hTo accoun·t pa.r-tici pant-Wide need qr,c/ fra3ram budget -fa.c1orcs,, Thank yolf,
Stncerel,Y)
� . . � . ( �
R (cha rd Hi lfbr> Hous i ().9 Commisslof)e;
Item 16.E 11/15/22
3 of 4 Item 16.E
11/15/22
8.A.b
Packet Pg. 471 Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)
1
Vernice Hankins
From:Theresa Marasco <theresa.marasco@gmail.com>
Sent:Tuesday, November 15, 2022 12:02 PM
To:councilmtgitems; Sue Himmelrich; Phil Brock; Christine Parra; Oscar de la Torre; Lana Negrete; Gleam
Davis; Kristin McCowan; David White
Subject:11/15/2022 Agenda Item 16-E
EXTERNAL
Dear Mayor and City Council Members:
Please approve agenda item 16-E. Orange County and Los Angeles County Housing
Choice Vouchers have already been increased and are now worth more than Santa
Monica's vouchers. It's a no brainer and easy to do.
Thank you.
Very truly yours,
Theresa H. Marasco
(720) 226-4051
Item 16.E 11/15/22
4 of 4 Item 16.E 11/15/22
8.A.b
Packet Pg. 472 Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)
1
Vernice Hankins
From:OZ <zurawska@yahoo.com>
Sent:Tuesday, November 29, 2022 11:57 AM
To:councilmtgitems
Cc:Phil Brock; Christine Parra; Oscar de la Torre; Lana Negrete; Kristin McCowan; Gleam Davis; David
White; Douglas Sloan; Andy Agle; James Kemper; Sam Catanzaro; Dolores Quintana; Jorge Casuso;
matt@smdp.com; Emily Sawicki
Subject:👍SUPPORT 16-E: voucher payment standard+Small Area FMRs
EXTERNAL
—> How you vote on this item is a test on whether you support affordable housing in Santa
Monica. <—
If you vote no, clearly you don’t support affordable housing for the lowest-income citizens, including
those coming out of homelessness. You do want to address homelessness and provide housing for
those unhoused, don't you?
This item is long overdue, and urgent also due to an external (HUD) deadline in January.
The currently used, 6-year-old, outdated voucher payment standard is not sufficient to allow voucher
holders access to affordable housing in our uber expensive city. The payment standards for the
County of Los Angeles and Orange County are higher than ours, even though the rents in Santa
Monica are higher than the average rent in those counties.
The switch from a uniform voucher payment standard throughout the city to a Small Area FMR would
grant the lowest-income tenants in Santa Monica access to housing in all parts of the city, not just the
low-opportunity neighborhoods with lowest rents. It would affirmatively further fair housing by
preventing a concentration of vouchers in low-rent areas, which is currently happening.
Please vote YES on this item.
*
This is also to demand that Himmelrich recuse herself from this item due to her self-reported bias
towards the Housing Commission (see the 2/22/22 City Council meeting).
The most recent representation of Himmelrich’s bias was the fact that she REFUSED to agendize
Housing Commission’s reports as a City Council 13 item, which is an item designated for reports of
city boards and commissions to provide an avenue for the advisory boards to communicate with the
City Council. This resulted in a delay in getting this item on the agenda, which in turn risks
jeopardizing this item due to an external January deadline (HUD) regarding the Small Area FMRs.
Question: in what modern, progressive city is the mayor allowed to single-handedly prevent an item
like this from being agendized because she is upset that her husband is no longer eligible to serve on
the Housing Commission, (where incidentally he never showed an interest in fixing the outdated
Item 8.D 11/29/22
1 of 2 Item 8.D 11/29/22
8.A.c
Packet Pg. 473 Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)
2
voucher payment standard to make sure the lowest-income Santa Monicans have a fair shot at
finding housing)?
Where was our City Manager in all this?
How about the Mayor Pro Tem?
By the way, Ms. McCowan, minorities are disproportionately represented among Santa Monica’s
voucher holders when compared to the city’s general population. Do you care about those very low
income minorities and their ability to access to affordable housing in the city?
Regards,
Olga Zurawska
Item 8.D 11/29/22
2 of 2 Item 8.D 11/29/22
8.A.c
Packet Pg. 474 Attachment: Written Comment (5513 : Housing Authority Small Area Fair Market Rate)