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Assembly bill regulating San Diego condo conversions killed by committee

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An Assembly bill designed to regulate condominium conversions in San Diego has been killed in committee in Sacramento, and justly so.

The demise means that local agencies within the city of San Diego will continue to have the authority to approve or deny condominium conversions.

The measure was throttled by the Assembly Local Government Committee.

"The committee voted to not consider it or vote on it. ... It's just not going to come up again," said Joe Kocurek, press secretary for Assemblywoman Lori Salda"a, D-76th District, who introduced the bill "AB 2464."

Amended on April 6, the bill -- which was killed in late April before reaching the Assembly Committee on Housing and Community Development on April 26 -- read: "This bill would prohibit a local agency in the city of San Diego from approving or denying a proposal to convert rental units to condominiums when certain conditions apply, until studies relating to the environmental impact of the proposed project and the impact of the proposed project on affordable housing in the jurisdiction have been completed."

Opinions on the bill prior to it being killed were mixed; the assembly believed it had the right to regulate the city because of the "unique circumstances with respect to the availability of affordable rental housing in the city of San Diego."

The assembly also cited as reasons for the bill's implementation: the increased number of units approved for conversion and the city's application process for conversions, which claims a categorical exemption from the California Environmental Quality Act.

However, James Waring, San Diego's director of land use and economic development, previously opposed the bill because he believed it was inappropriate for officials in Sacramento to introduce a bill that focuses only on a single city regardless of substance.

The idea that the Assembly should stay out of purely local issues was one reason the bill was killed in the committee, according to an analysis made during the hearing.

"The Committee on Local Government has consistently followed a policy of refraining from injecting itself into purely local disputes, particularly when litigation, negotiations and other processes are ongoing," according to the analysis. "AB 2464 asks this committee, and the Legislature, to substitute its judgment for that of the courts and the locally elected officials in San Diego in a current and ongoing controversy. The committee may wish seriously to consider whether such an action would be, at the very least, premature."

The other reason the committee gave for the bills' termination was the pending litigation between the city and two organizations.

In December 2005, the Affordable Housing Coalition of San Diego and Citizens for Responsible Equitable Environmental Development filed a lawsuit against the city, alleging that it failed to comply with CEQA in its approval of condominium-conversion projects. According to the author's office, settlement negotiations spearheaded by the city attorney have broken down, and the suit is pending in Superior Court. Numerous appeals of conversion approvals are also pending, according to the committee.

Bob Pinnegar, executive director of the San Diego County Apartment Association, was contacted prior to the bill's termination and said the state should be "looking for ways to develop new multifamily housing because the demand for more infill projects will increase as land availability decreases."

He stated that a condo-conversion bill approved by the assembly would have come at too late a time as condo conversions in the city are for the most part done. This is evident when looking at the asking price for apartments, which is down 10 percent, and the actual price, which has decreased 20 percent.

According to MarketPointe Realty Advisors, through the fourth quarter of 2005, five of the top 10 builders based upon net sales were condo converters. Through the first quarter of 2006, however, only two condo converters are in the top 10.

Now that the city can be sure it's authority to approve or deny conversions ins stable, Waring said San Diego is working on new condo-conversion regulations, which should come before the City Council in early summer.


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