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(0 votes) 3:21 pm
July 7, 2009
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I cycle around the neighborhood and see several boarded up properties. I've asked about some of them and I'm told that they are under the States Mello program so they have to sit empty for three years before any work can start. This seems to be idiotic in these troubled economic times. I know people who would love to be working on these projects. I'm assuming this is true all over California. Anyone have any more details
3:40 pm
June 6, 2012
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The Mello Act was meant to guarantee affordable housing by the beach back in the 1980's. Basically, before you can tear down a residential building, you have to show that it is not "affordable housing." They determine that by looking at the past three year's worth of rental income for the building. If there is no rental income for the past three years, then it's no longer "affordable housing." That's why these buildings are boarded up and not used. There's an exception for buildings that are owner-occupied as well as for buildings that are public nuisances.
Well-intentioned I'm sure, but with unintended consequences. In a state with 37 million people, not everyone is going to be able to afford to live within a mile of the beach.
3:52 pm
July 7, 2009
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Thanks SamIam.
I wonder how many places are just sitting there boarded up .Fixing this would look good on a politician's resume. Think of the jobs it would create.
5:11 pm
June 6, 2012
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Getting rid of the Mello Act cuts both ways. It would create jobs, and it would certainly spruce up a lot of neighborhoods (Venice included). But nice new rental units are also more costly. Getting rid of the 3 year Mello rule would mean that a lot of people in affordable housing by the beach would get evicted, the buildings would be torn down, and replaced with nice new housing. They would not be able to afford to move into the new housing and probably not even old housing by the beach. (Like I said, in a state with 37 million people, it's unrealistic to expect that everyone is going to be able to afford to live within a mile of the beach.)
Right now, there has to be a serious disconnect between rental income on the old units and the market value of new housing. Serious enough that an owner is willing to give up three years of rental income to tear it down.
5:20 pm
February 10, 2011
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So that implies that the buildings that are boarded up actually ARE affordable housing, and the owner is simply taking the three year hit so they can rebuild them as high end housing? Removing some affordable housing from the local market in return for larger profits.
5:23 pm
February 10, 2011
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Thanks for that clarification SamIAm. I guess it's a conflict of market forces and well intentioned but unrealistic regulations leading to a bit of a silly situation.
9:15 am
October 30, 2010
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Yes Mick, Sam I am is right on point. I was the manager of the buildings on 811 & 815 Ocean Front Walk. We had no affordable housing tenants in our units. However we were forced to use the three year rule to avoid the affordable housing obligation associated with the Mello Act. We were also forced to use the Ellis Act to remove our rental units off the rental housing market. This was a very expensive proposition for us. When you factor in the holding costs for a beach front property and all the legal and administrative costs, this is my definition of Socialism. How this law can remain on the books without consideration of the current economic climate we are in is like shooting your own foot. I guess to get to the oasis of Capitalism you need to cross the sands of Socialism.
