Lake Elsinore Pushes Ahead With Low-Income Housing Projects While Downtown Redevelopment Stalls

Lake Elsinore is pushing ahead with its $9 million Pottery Court affordable apartment project, meanwhile the city's ambitious plans for a downtown commercial business center have been put on hold.

City officials insist that Lake Elsinore needs more redevelopment where pockets of blight remain, but affordable housing seems to be where money is being spent, much to the chagrin of some local residents who want to see upscale development in the community.

Authorized under California law, redevelopment is a process that allows local government, under the auspice of local redevelopment agencies (RDAs), to use increased property tax to obtain and repay bonds that cover the cost of redevelopment projects in designated areas, but the process is subject to change: Gov. Jerry Brown has said he wants to eliminate RDA programs as a means to save the cash-strapped state some money.

The city’s RDA recently approved a resolution opposing the governor’s proposal.

In part, the city blames Sacramento's budget woes for the stall on some local redevelopment projects. For example, the city's project called for construction of a commercial center across from the Cultural Center in downtown. The concept behind the Business Incubator project was to attract budding businesses to Lake Elsinore via low-rent incentives. The Business Incubator theory was that once a business were to build up a large enough clientele, it would move to a larger facility in another part of the city, thus bringing jobs and revenue to Lake Elsinore.

City officials said the Business Incubator is on hold because the annual cost of the project exceeds what current redevelopment revenue will cover. The Lake Elsinore RDA expected tax increment money for running the Business Incubator to be higher. It fell short of the $150,000 needed annually.

But officials also said they want to wait on the Incubator until Gov. Brown decides whether to proceed with his plan to eliminate redevelopment programs.

“We might re-apply in the future,” said Melissa Melendez, Lake Elsinore Redevelopment Agency chairwoman.

Justin Carlson, city planning/redevelopment analyst, said the project cannot proceed until funding improves and the city knows what the governor’s action will be.

“Financing is on hold,” Carlson said.

In contrast to the Incubator project, the Pottery Court affordable housing project has been in the works for several years and will move ahead. Demolition at the site was finished in the fall and construction is slated to begin in April, with a groundbreaking ceremony planned for April 19. The project is expected to take one year to complete.

Of 113 apartments to be built at Pottery Court, 111 will be affordable, Carlson said.

“They will be open to anybody who meets affordability requirements,” he said adding, Lake Elsinore needs housing that is affordable and inclusive.

The project is being built by Bridge Housing Corp. on W. Pottery Street, between N. Langstaff Street and N. Riley Street. It will cover 4.3 acres.

The apartments are for residents earning between 30 and 50 percent of area median income. The one- two- and three-bedroom units will range from 671 to 1,096 square feet with monthly rents from the low $300s to the mid $700s, depending on the unit size and household income.

The development will feature community space including a study room, a music practice room, a great room, a full kitchen, a pool, barbecues and outdoor play areas.

Pottery Court and other affordable housing projects have run into opposition from residents wanting more upscale construction, Melendez admitted, but RDA rules mandate that a certain number of affordable homes be built based on the city’s population. Under redevelopment rules, the city must construct about 700 additional affordable housing units to satisfy state-mandated RDA requirements.

Lake Elsinore officials believe redevelopment projects will add value to the area even if they have the “affordable housing” label, and will give the city a newer and more stylish look.

“It’s all in how it’s managed,” Melendez said.

She emphasized that redevelopment is a benefit to the city.

Redevelopment funding in Lake Elsinore has provided more than $301,000 to prepare a downtown master plan and civic center study in 2009; to-date, the city has not moved forward on that plan.

Redevelopment also provided $37,625 for a senior center expansion in 2009.

In 2010, $45,000 was allocated in RDA funds to improve the Lake Elsinore Chamber of Commerce building.

In addition to the Pottery Court project, Lake Elsinore’s Redevelopment Agency is in the process of having 152 aging apartments refurbished at Lakeview Apartments on Riverside Drive. The Redevelopment Agency purchased the existing units at the site as part of the plan to renovate those needing upgrading.

The approximate $4.56 million project should conclude this summer.

Improvements include remodeling the kitchens and bathrooms as well as painting, new carpets and landscaping.

The work is being done in two phases with 88 apartments initially upgraded, followed by the remaining 64. The RDA estimates it would cost about $30,000 per unit to fix the apartments up.

The refurbished apartments are required to remain affordable for 55 years.