Condo owners stuck with bill

Dave Brooks

Condo owners who bought improperly converted units will likely be

asked to pay $17,900 in affordable housing fees to clear up their

titles.

“That’s a lot of money,” said condo owner Aaron Frankel, who has

been lobbying the city to drop the fee. “There will be many people

who oppose this.”

The figure, released in a nexus study by a Los Angeles consulting

firm, is the most controversial element of a recently proposed

conversion ordinance to help the city deal with a rash of improperly

zoned condominiums.

Earlier this year, it came to light that about 120 condominiums in

Huntington Beach had been converted from apartments without the

proper permits and then sold as individual units. In September,

Councilwoman Pam Julien Houchen resigned from office after it was

discovered that she sold several condominiums that the city

determined were improperly converted.

As the city grappled with how to fix the condominium problem, city

planners argued that the conversions meant a loss in rental

apartments, a key component of the city’s affordable housing stock.

To make up for that loss, the City Council voted to have current

condo owners pay into a special affordable housing fund, the exact

figure to be determined by a nexus study commissioned to consultants

Keyser Marston Associates. During the council hearings on the

conversion fee, City Atty. Jennifer McGrath said the figure would

exceed $20,000.

The nexus study reports that a $17,900 fee would generate about

$2.2 million to provide assistance to residential developers that

agree to build affordable housing. The revenue would allow the city

to help build about 31 units with contributions of $70,500 apiece.

Paying the affordable housing fee would allow residents to skip

several expensive conversion fees that could be as much as $31,570,

according to the study. Many condo owners argue they’ll end up

spending that much anyway in additional development costs and legal

fees.

The figures still need to be approved by the City Council. Mayor

Cathy Green said the council won’t take on the issue until after a

federal investigation into the matter is completed.

“I don’t feel comfortable moving ahead with this until we have all

the information,” she said.

The FBI report was set to be released by Nov. 1, but that date has

been moved back, Police Chief Ken Small said.

Until then, the item will be on hold.

“I hope it will give us some information into how things went

down, how people were victimized and how all this happened,” Green

said.

For now the condo-owners who bought the improperly converted units

must wait for a council decision. Several have become active in the

upcoming council election and are hoping to find candidates that are

sympathetic to their cause.

“In general, people have been talking about who would make a good

candidate and the folks facing the condo situation would want to

support,” Frankel said.