Court of Appeal:
By a MetNews Staff Writer
A requirement imposed under the Hollywood Redevelopment Plan that 15 percent of new housing be “available at affordable housing cost to, and occupied by, persons and families of low or moderate income” is no longer operative, the Court of Appeal for this district held yesterday.
The plan was established in 1986 by the Community Redevelopment Agency of the City of Los Angeles. All community redevelopment agencies in the state were dissolved as of Feb. 1, 2012, and yesterday’s opinion examines the effects of the legislation creating that dissolution.
The opinion by Presiding Justice Frances Rothschild of Div. One affirms a Nov. 4, 2020 judgment by Los Angeles Superior Court Judge Richard L. Fruin Jr. denying a writ of mandate sought by the AIDS Healthcare Foundation and Coalition to Preserve LA. They wanted to block a real estate development project in Hollywood that had been approved by the defendant City of Los Angeles.
The real party in interest, 6400 Sunset, LLC intends to transform the former Amoeba Music Building into a 26-story mixed-use building that would include up to 200 residential units. As approved by the city, five percent of the units must meet the definition of “affordable housing,” not the 15 percent spelled out in the redevelopment plan.
That 15 percent requirement, the petitioners argued, is mandated by Health & Safety Code §33413(b)(2)(A)(i), a part of the Community Redevelopment Law (“CRL”). While that code section remains, portions of the CRL providing for “tax increment financing”—under which future anticipated property tax revenue increases, caused by the redevelopment, are diverted to projects—were repealed by the Dissolution Law enacted in 2011.
Depicted above is the planned development at 6400 Sunset Blvd. The Court of Appeal yesterday held that the City of Los Angeles properly approved the project.
In his Oct. 13, 2020 statement of decision, Fruin said:
“The Project does not rely on tax exempt financing that sustained the redevelopment agencies created under the CRL, and, therefore, the 15 percent affordable housing requirement provided in H&S 33413, subd. (b)(2)(A)(i) does not apply to the Project. The provisions of the CRL that relied on tax exempt financing for new projects, moreover, were repealed and the redevelopment agencies themselves dissolved in 2012, with certain legacy responsibilities of the redevelopment agencies assumed by custodian agencies….The Project, therefore, is not subject to any state mandate to reserve a fixed percentage of its units as affordable.”
The Hollywood Redevelopment Plan, he noted, “was created to facilitate tax exempt financing under provisions of the CRL that no longer exist,” thus having no continued efficacy.
Fruin also pointed out:
“The Project, moreover, does not violate the Community Redevelopment Law or another reason. The statute expressly provides that the City may satisfy the 15 percent requirement by providing for more affordable units outside the redevelopment area or, upon making specified findings, by combining projects not only areawide, but over the life of the development plan.”
Appeals Court Opinion
The appeals court yesterday expressed agreement. Rothschild wrote:
“The City and the real party contend that the Dissolution Law renders the 15 percent requirement inoperative because complying with that requirement depends upon the allocation of tax increment to redevelopment agencies. We agree.”
“Appellants do not refer us to any provision in the Dissolution Law that reasonably suggests that the Legislature intended the 15 percent requirement to survive after it dissolved redevelopment agencies and eliminated tax increment financing.”
The presiding justice, agreeing with Fruin, said that even absent the Dissolution Law, the 15 percent requirement would not apply to an individual project.
The case is AIDS Healthcare Foundation v. City of Los Angeles, B309892.
Douglas P. Carstens, Michelle Black and Sunjana Supekar of the Hermosa Beach firm of Chatten-Brown, Carstens & Minteer LLP represented the plaintiffs/appellants. Christi Hogin and Patrick T. Donegan of the Manhattan Beach form of Best Hoggin & Krieger acted for the city, along with Deputy City Attorneys Steven N. Blau, Kathryn Phelan and Jennifer Tobkin. Patricia L. Glaser, Joel N. Klevens and Alexander J. Suarez of the Century City firm of Glaser Weil Fink Howard Avchen & Shapiro argued 6400 Sunset, LLC’s position.
Above is the erstwhile Amoeba Building in Hollywood at Sunset and Ivar.
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