STATEMENT OF FINDINGS SENIOR RELATED HOUSING ISSUES

Prepared for PLANNING FOR AN AGING CALIFORNIA: AN INVITATIONAL FORUM April 1-2, 2003

Sponsored by California Commission on Aging

Prepared by Jon Pynoos, Ph.D. Marvin Schachter Christy Nishita, Research Assistant, USC Andrus Gerontology Center Carla Hett Smith, Program Analyst

Commission Housing Committee Commissioner Jon Pynoos, Chair Commissioner Shirley Bierly Commissioner Marvin Schachter Commissioner Leah Wyman California Commission on Aging April, 2003

Table of Contents

Prologue 2 I. Introduction and Purpose 3 II. Statement of Findings 3 III. Research and Statistics 7 IV. Discussion of Issues 12 Sources 23

Statement of Findings on Housing Page 2 California Commission on Aging April, 2003

Prologue

The California Commission on Aging (CCoA), under the Older Californians Act, is to act as "the principal advocate in the state on behalf of older individuals, including, but not limited to, advisory participation in the consideration of all legislation and regulations made by state and federal departments and agencies relating to programs and services that affect older individuals." As such, it is the principal advisory body to the Governor, State Legislature, and State, Federal and local departments and agencies on issues that ensure a quality of life for older Californians so they may live with dignity in their chosen environment.

SB 910 (Vasconcellos) requires, among other things, that the California Health and Human Services Agency (HHSA) prepare a long range strategic plan on aging by July of 2003, and consult or seek the advice of CCoA on this strategic plan. Preparing the Commission to provide such advice, a series of field meetings called "public discussions" were convened around the state. In April, 2002, a public discussion in Eureka focused on rural aging issues; a June discussion in Ontario focused on senior health issues; a September discussion in Fresno focused on senior transportation issues; a December discussion in Los Angeles focused on senior housing, and a February, 2003 discussion in Marin County highlighted planning/systems design for home and community based services for seniors and adults with disabilities.

Input in the public discussions came from a variety of sources including: State legislative staff, local government representatives, area agency on aging directors, area agency advisory council members, physicians, university researchers, local and state aging and disability advocates, issue specific state advocates (housing and transportation), seniors and disabled adult consumers, and aging and disabled services providers.

This paper was developed as a result of those public discussions and research into the particular issues of senior health, transportation, housing, and planning/systems design.

This Statement of Findings will serve as the basis for discussions with state leadership during the Commission's April 1-2, 2003, Statewide Invitational Forum.

Following the Forum, the Commission will produce a Statement of Recommendations that captures the dialogue that occurred on April 1-2. These recommendations will be submitted to Secretary Grantland Johnson, HHSA, as CCoA's formal input into the long range strategic plan for aging. CCoA will also submit the recommendations to the Governor and State Legislature.

Statement of Findings on Housing Page 3 California Commission on Aging April, 2003

I. Introduction and Purpose

Affordable and suitable housing is of vital importance for California’s seniors and adults with disabilities. Housing plays a disproportionately important role in the lives of this population due to its cost, the amount of time elders spend in their home and their desire to age in place. Moreover, housing is a major determinant of safety, ability to get out into the community, and the ability to afford other basic necessities of life. Many older adults express a strong desire for continuity in their living arrangements, yet often face high housing costs or live in physically unsupportive environments that are disconnected from services. Instead of facilitating older persons’ ability to grow old safely, independently, and with dignity, many settings have instead become a source of the problem itself. Likewise, for older persons who need more services and support than can be provided in their homes and apartments, there is an inadequate supply of affordable supportive housing options. Consequently, many older persons are faced with living in inadequate settings or moving to more institutionalized settings. Subgroups that are most vulnerable to poor housing conditions are older persons who are poor, frail, female, minorities, those living alone, and residing in rural areas1. The California Commission on Aging’s Strategic Plan emphasizes the importance of housing for older adults. Input from public discussions in Eureka on April 10, 2002, Ontario on June 5, 2002, and Los Angeles on December 11, 2002, helped focus the structure and ideas presented in this paper. Additional ideas were identified through various meetings with state housing leaders and experts and the research of the Commission’s housing committee.

II. Statement of Findings

The Commission’s findings from the above-mentioned sources identified four main housing problems that need to be addressed: Affordability, adequacy, accessibility, and appropriateness. The Commission’s findings regarding these issues and suggested measures to address them are summarized here. All of the issues and suggestions are supported by research in the detailed Discussion of Issues section of this paper. Following discussion with state leaders and officials on the statement of findings during the April 1-2 Invitational Forum, these ideas will be reviewed and expanded to become the Commission’s recommendations for the Statewide Long Range Strategic Plan on Aging.

A. Affordability Housing costs remain a serious problem for older Californians and government subsidized housing continues to be in short supply. Therefore, the Commission suggests the following affordability ideas for discussion with state leaders and officials:

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1. Target Low-income Housing Tax Credits. Older adults should be given a higher priority in the allocation of the low-income housing tax credits and the program should include more supportive housing, housing linked to services, and assisted living. For example, Massachusetts has used a large proportion of their tax credits for the elderly and Oregon has used them to develop assisted living.

2. Create Direct Financing Programs. California could take steps to create a state housing trust fund as an ongoing and dedicated source of funding for affordable housing that includes earmarked funds to help finance a range of supportive housing options for the elderly.

3. Ensure a Fair Share of Senior Housing in the Administration of the Housing and Emergency Shelter Trust Fund Act of 2002. One possible method to insure that the needs of vulnerable elderly are met is to add "frail elderly", "at risk elderly" and/or "very low income" elderly under the Special Needs Population category. HUD's definition of "frail" consists of residents who need help with 3-5 activities of daily living (ADL's), and the "at risk" resident population who need help with 1-2 ADL's. Without a supportive housing setting and services, such frail elderly are in serious danger of having to move to more costly institutional settings such as board and care and nursing homes.

4. Preserve Section 8 Housing. A significant proportion of Section 8 voucher holders are seniors. Specific steps must be taken to prevent the opting out of the program by of building owners: a. Provide greater incentives for building owners to remain in the program. b. Where landlords do opt out of the program, provide assistance (short term subsidized rent) to tenants living in buildings that are converting to market rent in order to give tenants time to relocate to other affordable housing.

5. Continue to Support Section 202 Housing Production. Encourage California’s Congressional Delegation to advocate for continued funding commitments to the federal Section 202 senior housing program.

6. State Enforcement of the Housing Element in local General Plans. The state housing element law needs tightening to insure that all local governments, including those that are non-compliant, submit their plans and address the issue of the need for senior housing.

B. Adequacy Moderate to severe problems with electricity, plumbing, or heating exist in many dwelling units of older Californians. Inadequate housing threatens older adults’ health,

Statement of Findings on Housing Page 5 California Commission on Aging April, 2003 safety, and quality of life. With insufficient numbers of new housing units being added in California to meet the needs of our target population, we must look to making existing housing units adequate and accessible. Therefore, the Commission suggests the following ideas for discussion with state leaders and officials to improve the adequacy of housing for older persons:

1. Identification of the need for additional funding for basic home improvements to improve health and safety in the state’s Consolidated Housing Plan. 2. Expansion of the current state funding sources for home improvements - the State Community Development Block Grant Program and the California Self- Help Housing Program. 3. The creation of a state low-interest loan program for home repair for low- income residents, similar to Maine’s FIX Me program. 4. Working with private sector on initiatives that support home repair.

C. Accessibility The home is the long term care delivery site of the future. Most single-family homes, apartment complexes, and subsidized housing in which older persons live have significant accessibility barriers and do not provide supportive environment or service linkages. As the population ages, the lack of accessible and supportive housing becomes an even more important issue. The Commission suggests the following accessibility ideas for discussion with state leaders and officials:

1. Help low and moderate income older persons access housing and home modification information, including how to access funding. a. CDA should preserve the core functions of what was the Senior Housing Information and Support Center (SHISC) and insure that its materials and information, including a public service announcement on home safety, are made available to the public. b. CDA should assign staff to handle housing issues, coordinate its programs with other state housing agencies, and be aware of other senior organizations’ housing efforts. c. The California Housing Finance Agency could develop accessibility loan and grant programs modeled after a program sponsored by Minnesota’s Housing Finance Agency. 2. Link home modification better with community based programs. In order to insure that the home setting supports aging in place, comprehensive home assessments in home and community based services programs (e.g., MSSP and other case management services) should be conducted to help divert seniors from nursing homes and allow older persons to age in place. These workers and other community services providers should be trained in Fair Housing Laws to improve their ability to advocate with landlords for improvements in housing settings.

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3. Provide Increased Funds for Home Modifications a. Recognizing that home modification can help reduce accidents such as falls and save long-term care costs, provide additional resources for the provision of home modifications through programs such as Medicaid. b. The California Housing Finance Agency could develop accessibility loan and grant programs modeled after the Fix Up program sponsored by Minnesota’s Housing Finance Agency. 4. Encourage Visitability and Universal Design a. In order to build housing correctly in the first place, California should endorse the concepts of visitability and universal design, providing incentives for builders and developers to adopt these practices in housing funded by the state. b. Incentivise local government adoption of mandatory universal design guidelines and ordinances.

D. Appropriateness Seniors and adults with disabilities who are cognitively or physically impaired, but not in need of intensive medical services, can live in a variety of settings (a ‘continuum of housing’) with supportive physical features and linkages to services to the extent that they are available and affordable. In order to fill in the gaps that currently exist in the ‘continuum of housing’, the Commission suggests the following appropriateness ideas for discussion with state leaders and officials:

1. Include housing in strategies to increase integration in home and community based services, recognizing that home modifications can save long term care service dollars; supportive housing options can prevent relocation to board and care; and housing alternatives such as assisted living and special housing for persons with Alzheimer’s Disease can allow frail older people to live in residential settings and prevent placement in nursing homes. 2. Cluster Services in Housing Sites and Naturally Occurring Retirement Communities (NORCs) in order to increase efficiency. a. Target and cluster services such as health clinics, transportation, preventive health, congregate meals, and legal assistance in government assisted housing complexes and use them as platforms to serve older persons in the wider community. b. In their competitive ranking of applications for dollars for senior housing, California Housing Finance Agency and CA Department of Housing and Community Development (HCD) should encourage the development of partnerships with organizations such as Health Maintenance Organizations (HMOs), community based care systems, public health, and second career employment programs. c. Encourage volunteer pilot programs leading to more efficient provision of services in housing settings.

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3. Fill in the continuum of housing by encouraging the development of housing options such as small group homes for persons with Alzheimer’s disease and ECHO housing. a. Promote zoning codes that allow for such specialized housing types in neighborhoods. 4. Utilize New Integrative Models of Elderly Housing a. Increase flexibility in the use of funds at the state and local levels to allow the adoption of models of housing that incorporate both public (e.g., senior centers, day care centers, classrooms) and and commercial spaces (e.g., restaurants, stores). b. Provide incentives or priorities for California Housing Finance Agency (CHFA) senior housing financing applicants that demonstrate innovation by providing housing linked with services. Encourage partnership between developers, service providers, and other community organizations to bring this about. c. Develop closer working relations among HCD, California Department of Transportation, CDA, and California Health and Human Services Agency (HHSA) in order to foster innovative housing developments. d. Utilize the state plan on aging and area plans on aging to incorporate and encourage these integrated housing models. 5. Affordability and Regulation of Assisted Living Facilities (ALF’s) a. Explore governmental funding sources such as Supplemental Security Income, HUD Section 8 vouchers and the Medicaid waiver program to pay for housing and services in ALF’s. b. Encourage Department of Health Services implementation of the Assisted Living Waiver Demonstration Program (AB 499).

III. Research and Statistics

A. Affordability 1. Home Owners’ and Renters’ Affordability Problems Older renters are more likely to have lower incomes than older homeowners. According to the latest census in 1999, 74.5% of Californians aged 65 and older lived in owned units and 25.5% lived in rented units. In comparison to owners, renters were more likely to have incomes of less than $10,000. Among Californians 65-74, 35.1% of renters versus 11.1% of owners were low-income. The situation worsens among persons 75 and older: 46.4% of renters and 22.4% of owners were low-income. Due to these lower incomes, high housing cost problems are concentrated primarily among renters, rather than homeowners. Among Californians aged 65- 74, one in five homeowners pay 30% or more of their income on housing, contrasted with 61% of renters.

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Figure 1. Percent of Older Californians Paying More than 30% of Income on Housing

80.0%

t 60.0% n e c

r 40.0% e P 20.0%

0.0% Owners Renters Owners Renters 65-74 years old 75+ years old

Source: AARP (1995). State Housing Profiles. Washington, DC: American Association of Retired Persons.

Even more serious are the problems of persons who spend more than 50% of their income on housing and are considered by the federal Department of Housing and Urban Development (HUD) to have severe housing cost burdens. In California, 22% of all older renters pay 50% or more of their household income for housing, while 16% pay 60% or more2. Nationally, half of all older homeowners with severe housing costs are still paying off a mortgage1. The other half own their homes free and clear, but report problems such as the cost of utilities, taxes, and insurance. Nevertheless, homeowners tend to have higher incomes than renters that enable them to address these expenses. Certain sub-populations of elders are extremely vulnerable to severe housing costs. Nationwide, women account for two-thirds of senior households with severe housing cost burdens and two-thirds live alone1. By race and ethnicity, 25% of white elderly nationally are so burdened, contrasted with 70% of Black and 53% of Hispanic older households1. In rural areas of the western United States, 21% of all households pay more than 30% of their monthly income on housing3. Housing cost burdens are especially detrimental to the elderly because they are more likely to live on a fixed income than younger age groups. In three California counties (Marin, San Francisco, and Santa Clara), Fair Market Rent (FMR) for a studio apartment exceeds the average monthly SSI/SSP payment, a primary source of income support for low-income elderly. In 39 of the state’s 58 counties, recipients of SSI/SSP would have to spend over 50% of their income on rent based on the FMR4.

2. The Importance of Subsidized Housing Subsidized housing needs to be preserved because it plays a major role in providing senior housing. For over 40 years, the federal government has increased the housing supply for older persons by financing construction of

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elderly units and reducing rents through tenant subsidy programs. Nationwide, approximately 1.7 million older persons live in federally subsidized housing. Public housing is the largest federal housing program for low-income older persons serving approximately 500,000 elderly persons, primarily in special housing for the elderly. Section 202 of the 1959 Housing Act has provided funds for non-profit organizations to develop about 325,000 units occupied by 387,000 tenants. Sections 515 and 516 of the Housing Act of 1949 provide housing assistance to rural residents and farm laborers through tenant subsidies. In addition, older persons live in a variety of housing developed through other federal programs (e.g., Low Income Housing Tax Credit (LIHTC), Section 236, Section 8 new construction) that have reduced interest rates on loans for developers. Such programs have generally produced shallower subsidies than public housing. In order to make these programs affordable by low-income persons, many residents receive Section 8 rental certificates vouchers, designed to reduce housing expenses to 30% of income. Across the nation, the federal Section 8 program is under-funded and only 1 in 4 eligible households receive assistance. In California, there were approximately 1,700 senior housing projects with 225,000 units in 19955. Of these, 800 projects, or 150,000 units received either construction or rental assistance from HUD. Approximately 125 projects with 22,000 units received housing assistance from the Rural Development Administration (See Table 1).

Table 1. Senior Housing Facilities and Units in California

Type of Housing Number of Facilities Number of Units HUD-Subsidized 800 150,000

Rural Development Administration-Assisted 125 22,000

Low-Income Tax Credits 63 4,410

HCD Rental Housing Construction Program 20 1,100

Unsubsidized Facilities 700 49,000

Totals 1,708 226,510

Source: California Senate Office of Research, 1995. Beyond Bricks and Mortar: Issues Facing Senior Housing in California.

B. Adequacy Older adults tend to live in older homes, usually built prior to 1960. Nearly 1.5 million older households across the nation live in dilapidated housing in severe need of

Statement of Findings on Housing Page 10 California Commission on Aging April, 2003 repairs related to such housing systems as plumbing and heating; over 1 million are homeowners and 400,000 are renters1. Among Californians 65 and older, over 12,000 renters and 11,000 homeowners live in housing with incomplete plumbing, one of several indicators of inadequate housing.6 Some homeowners may be in a better position to afford repairs, have the authority to make them, and tap into reverse mortgages to make such repairs. However, many older homeowners do not have the resources or enough equity in their homes to afford such changes. Nationally, inadequate housing conditions are especially concentrated among older households who are poor, minorities (e.g., African Americans and Hispanics), widows, very old (85 years or older), and frail1. Elderly households in rural areas, and to a somewhat lesser extent in central cities of metropolitan areas, are also more at risk of occupying housing in poor condition. Nationally, 1.6 million non-metropolitan households are living in housing classified as substandard7.

C. Accessibility and Appropriateness Nationally, 95% of older adults live in non-institutional community settings. The overwhelming proportion of these older persons prefer to remain there8. For such residents, their current housing often represents a sense of security, proximity to friends and familiar services, and memories of where they raised their families. In spite of the strong preference of older persons to age in place, increasing frailty may prevent them from achieving this goal. Among older adults residing in affordable senior housing communities in California, 17% have 2 or more activities of daily living (ADL’s – basic life functions such as bathing, dressing, and toileting) deficiencies9. As a whole, the latest 2000 census indicates the levels of disabilities among Californians aged 65 and older (See Figure 2) is considerable and rises rapidly with advanced age.

Figure 2. Prevalence of Disability Among Older Californians

33% 35% 30% 25% 17% 20% 14% 15% 12% 10% 5% 0% Sensory Physical Mental Disability Self-Care Disability Disability Disability

Source: California Association of Homes and Services for the Aging (2000). 1999-2000 Affordable Senior Housing Survey. California Association of Homes and Services for the Aging.

At the same time, residents of senior housing are older and more frail than other seniors in California (See Table 2).

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Approximately 1.14 million older persons nationwide with health and mobility problems have unmet needs for additional supportive features in their dwelling units1. According to the 2000 census, over half a million older Californians have functional limitations. Extrapolating from national data on older adults to older Californians, almost half or 219,000 older persons express a need for home modifications while only 117,000 older persons have the home modifications they need. The reality of these unmet needs suggest that these persons can benefit from physically supportive housing settings linked with services. One approach to addressing these needs is a continuum of housing options, ranging from least supportive to most supportive for seniors and adults with disabilities.

Table 2. –Characteristics of Senior Housing Residents Versus Other Seniors in California

Characteristic Senior Housing Residents Other Seniors

Age % over 85 15.0% 9.4% % 75-84 39.0% 31.3% % 65-74 39.0% 59.3%

Degree of Frailty % Needing assistance with 12.0% 11.4% 1 or more ADLs % Needing assistance with 8.0% 6.2% 2 or more ADLs % Needing assistance with 29.0% 10.1% housework % Needing assistance with 24.0% 11.0% shopping % Needing assistance with 19.0% 7.5% meal preparation % With some degree of 15.0% 5.0% cognitive impairment

Other Characteristics % Living alone 86.0% 26.1% % Living below poverty 50.0% 8.0% level % Minorities 30.0% 22.0% Source: California Senate Office of Research, 1995. Beyond Bricks and Mortar: Issues Facing Senior Housing in California.

IV. Discussion of Issues

A. Affordability: Barriers to Providing Affordable Senior Housing

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The most prevalent housing problem of the elderly is the burden of housing costs. Older adults may become impoverished as too great a proportion of their household income is dedicated to housing, leaving inadequate resources for other necessities, such as food and health care. Housing costs are more serious for older adults, because they are often on a fixed income with little capacity to raise their incomes. The following are a list of barriers to affordable senior housing:

1. Government Subsidized Housing is in Short Supply Many older Californians experience serious housing cost problems. Yet, the availability of subsidized housing units for low-income persons is limited. Long waiting lists and low vacancy rates for federal, state, and locally subsidized housing was emphasized at the field meeting/public discussion in Los Angeles. Waits of up to three years or more for entry into Section 202 housing are common10. In Section 8 and public housing, there is a large gap between the number of wait-listed applicants and the number of housing units available. In California, there are 371,740 families and elderly on Section 8 waiting lists for 104,133 units of housing that are currently occupied. Another 93,632 families and elderly are waiting for 25,268 units of public housing11. Across California, in one sample of 146 senior housing properties, there were a total of 18,000 seniors on waiting lists9. Some applicants cope by cutting expenses, moving in with others, or asking relatives and friends for assistance, but most have already reduced their expenses to the extent possible12. It is important to recognize that the lack of affordable housing not only affects older adults, but low-income individuals and families of all ages. However, because of disabilities associated with aging and fixed incomes with little potential for increases, the elderly are uniquely burdened by the lack of affordable housing. Those on waiting lists for housing have few alternatives because vacancy rates in California are at an all-time low. For example, in areas such as San Francisco and Berkeley, it is virtually impossible to find affordable housing of any kind11. Thus, elderly Californians have few alternatives but to cope with the high cost of their current residence or make a life disrupting move. Even when they obtain a Section 8 voucher, they often have difficulty finding both units that meet cost and quality requirements, and landlords willing to accept the vouchers.

2. Loss of Subsidized Housing The problems of low-income persons are exacerbated by a loss of existing subsidized housing stock. As of April 2001, nearly 20,000 subsidized low-income housing units have been converted to market rents in California4. Under HUD’s Section 8 programs, landlords received low-interest loans, subsidies, and other incentives to house low-income families, disabled, and the elderly. Some

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developers are paying their loans off early and converting to market rents or opting not to renew their Section 8 contracts.

3. Loss of Affordable Housing Through Gentrification Gentrification and redevelopment also lead to the displacement of low- income persons of all ages. For example, gentrification in and near San Francisco’s Chinatown is forcing low-income residents out of their community and keeping others from moving in, thereby preventing them from taking advantage of the On Lok program that exists there. On Lok, which became a model for programs across the country called “Programs of All Inclusive Care for the Elderly (PACE),” enables frail elderly to remain at home by providing access to an interdisciplinary team of health care providers. Displacement of residents involved in these types of innovative programs threatens the health of clients, who are still in need of services.

4. Overall Lack of Housing Production in California Between 1990 and 2000, approximately 400,000 single family and multi- family housing units were built in southern California. This stands in sharp contrast to the previous decade (1980-1990), when approximately 1 million housing units were produced. The most significant drop was in multi-family housing unit production, where only 120,000 units were built in the 1990’s in comparison to 470,000 in the previous decade. According to Southern California Association of Governments13, 58,400 new housing units are needed to keep pace with population growth in southern California. However, the region has had a yearly annual shortfall in single- and multi-unit family home production of 16,400 units since 1991. The lack of housing production to meet population growth decreases the available housing supply and increases housing prices.

5. Difficulties with Federal Low-Income Housing Programs: Section 8, Section 202, and Rural Housing Issues

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a. Inefficiency of Section 8 Vouchers As previously noted, the Section 8 program is severely underfunded. Yet even among those who receive a voucher, less than half are able to use them. Section 8 vouchers are inefficient because they rely on the private marketplace which is not open and often hostile to those using the Section 8 program to find housing. There is no requirement in California that landlords accept vouchers, and there are requirements placed on landlords who accept the vouchers that may seem burdensome. Especially in a tight rental markets, landlords can easily choose other tenants. The problem is compounded in that HUD lags behind in updating its ‘fair market rate’ (FMR), the rate that determines the amount paid to a landlord under Section 8. At any given time, HUD’s FMR reflects market rates from several years prior, making it difficult for Section 8 rates to compete in today’s markets. Thus, some landlords already participating in the Section 8 program have a financial incentive to evict these in order to rent the units at a higher price or not to renew contracts. Also, since voucher holders are screened by landlords, previous eviction and bad credit prevents some voucher holders from finding a residence. Some local governments have attempted to mediate the detrimental effects of Section 8 implementation. For example, in Santa Monica, city policy dictates that if the owner opts out of Section 8, the city will pay the higher rent charged by the landlord for a certain period of time. This policy gives tenants time to find affordable housing. The City of Los Angeles passed an ordinance to prevent the eviction without cause of Section 8 tenants. Various states and local jurisdictions have attempted through Fair Housing Law to prohibit discrimination against Section 8 voucher holders by landlords. California Fair Housing Law prohibits discrimination against source of income, but advocates argue that this is not enough to prevent landlord discrimination against Section 8 tenants. Stronger laws exist in New Jersey, Connecticut, Massachusetts, Chicago, and San Francisco. These laws and ordinances further broaden the definition of source of income. Some of these creative definitions include: 1) Any lawful rent payment, 2) All lawful sources of income or rental assistance from federal, State, local, or nonprofit-administered benefit program, and 3) Income derived from social security, housing assistance, child support, or public or general assistance.

b. Developers’ Difficulties in Utilizing Federal Section 202 Program Several difficulties in the Section 202 Program were raised by developers in the Commission’s Los Angeles meeting. Because of local planning processes and funding constraints, developers often cannot meet

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the 2-year time frame of utilizing the Section 202 grant. Additionally, because grantees under Section 202 are non-profits, they often have difficulty coming up with their 10% match requirement. As previously mentioned, multiple funding sources are leveraged to make affordable housing work. Many Section 202 projects utilize Section 8 vouchers. This is done through federal contracts that in the past were of 20-year-long duration. The contract renewals are now ranging from 1 to 5 years. Sustainability of affordable housing projects is compromised by this policy. Also, testimony heard by the Commission described a local disincentive for providing Section 202 housing. Local jurisdictions cannot give preferences to housing applicants from their jurisdiction, thus, even though they created the housing with the intention of meeting local needs, there are no guarantees that local needy residents will actually be able to live in the housing.

6. Scarce Supply of State Resources for Affordable Senior Housing: Proposition 46, Housing Trust Fund, Low Income Housing Tax Credit (LIHTC)

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a. Need for a State Housing Trust Fund A rapidly growing method of financing housing developments across the nation has been the creation of state and local housing trust funds. Where they exist, these funds have been very effective at providing ongoing funding to ease affordable housing shortages. Housing trust funds are dedicated public sources of revenues, established by legislation, ordinance or resolution, which can only be spent on housing14. For example, Florida dedicates a document transfer fee tax of 2% toward their state’s housing trust fund. In California, there are many local housing trust funds, but no state housing trust fund. A barrier to this state source is proposition 13, which requires a 2/3 vote in the legislature for a tax or fee increase.

b. Proposition 46 The passage of Proposition 46, the Housing and Emergency Shelter Trust Fund Act of 2002, provides a $2.1 billion dollar housing bond for affordable senior housing. In contrast to a permanent state housing trust fund, this bond measure is a temporary source of funding that will run out in a few short years. The part of the bond that is dedicated to rental housing is channeled through the state’s Multi-Family Housing Program. All funds are targeted to lower-income persons and those that are considered by the state to have the most pressing needs. Unfortunately, even though many older persons are low-income, and experience physical and cognitive impairments, frail elderly are prohibited from being a “special needs” category in the points distribution of funding applications. This makes it very difficult for housing sponsors to obtain funding to build housing specifically for seniors.

c. Low Income Housing Tax Credit Prioritizing The LIHTC is an important federal resource for producing low- income rental housing. The LIHTC program creates affordable rental housing by offering investors a credit against federal income taxes based on the cost of acquiring, rehabilitating, or constructing low-income housing. Each state is allocated a certain amount of tax credits to administer. California’s Tax Credit Allocation Committee sets priorities as to how these credits will be distributed. In California, 63 or 3.7 % out of 1,708 complexes receiving low- income tax credits in the early 1990’s were non-licensed senior housing projects. California has set families as a higher priority than elderly for the program. Currently, 15% of tax credit awards are set aside for senior housing, while 60% of awards are set aside for family housing. Additional set asides include 10% for projects considered to be at risk of being lost due to landlords marking them up to market rates, 10% for Single

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Resident Occupancy (SRO), and 5% for special needs. However, even tax credit assistance sometimes requires additional financing mechanisms (such as Section 8) to make units in these properties affordable to the very lowest income elderly when the projects are located in expensive housing markets such as the Bay Area.

7. Poor Enforcement of State Housing Element Law Currently, California State law requires a ‘housing element’ in city and county General Plans that are supposed to guide development through local land use plans. Housing elements are required to be submitted to the California Department of Housing and Community Development for approval every 5 years. The purpose of the housing element is to ensure that communities plan for the housing needs of all their residents, although the law does not require that the local governments provide housing to meet these needs. The housing element is an ideal place to raise awareness about the housing needs of the elderly and to identify strategies to address their problems. Unfortunately, over 1/3 of jurisdictions within the state are out of compliance because they do not produce a housing element, and there is no state enforcement that they comply.

8. NIMBYism (Not In My Back Yard) Against Affordable Housing Developments Several testimonies heard by the Commission reflected local battles that are fought over the siting of affordable housing. One advocate pointed out that affordable housing should be allowed to bypass local planning commissions and other authorities ‘by right’ because of the great need. They felt meeting the needs of certain local residents should not be dependent upon opinions of other residents.

9. Local Land Use Barriers Land for development of housing, especially for affordable housing, is in short supply in California. In the early 1990’s, the state used local money to backfill state revenue losses, creating financial hardships for many local governments. This resulted in the local fiscalization of land use: using land in way that will bring in the maximum revenue to local governments. An example is the preference to zone and use land for commercial purposes (e.g., WalMart and Costco Stores) instead of housing because of the sales tax revenue that will go to the local government. Some local jurisdictions have passed ordinances that allow for mixed-use housing (residential and commercial combined use). Additionally, bonuses and other zoning/permit benefits are offered that encourage high-density housing. These are examples of creative ways to open up land for use for affordable housing and to make developing affordable housing more financially feasible.

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B. Adequacy: Barriers to Adequate Housing Excessive housing costs can prevent persons from maintaining their place of residence or obtaining decent living accommodations in the rental housing market. Assistance is needed to help low-income elderly homeowners make basic improvements so their homes are secure, safe, and livable. The State Community Development Block Grant Program and the California Self-Help Housing Program provide grants for housing rehabilitation. In other states, programs provide loans directly to low-income homeowners. Maine’s FIX ME program helps very low to low-income homeowners with low-interest loans to make home repairs. Administered by the Maine State Housing Authority, the program provides for repairs for roofs, electrical, plumbing, or heating systems, and accessibility improvements.

C. Accessibility: Barriers to Providing Accessible Housing 1. Lack of Basic Accessibility and Supportive Features As the population ages, the lack of accessible and supportive housing becomes an important issue. Unfortunately, the overwhelming proportion of single-family homes, apartment complexes, and subsidized housing in which older persons live were built for residents who were physically and socially independent, thus accessibility or provision of supportive services was not considered. These dwelling units have been referred to as “Peter Pan” housing, designed for persons who will never grow old. They include stairs that are difficult for frail older persons to climb, inaccessible entrances for those using a wheelchair or walker, and unsafe bathrooms. The addition of accessible and supportive features in these dwelling units can improve their safety, make caregiving easier, delay premature and costly institutionalization which saves money that would otherwise be spent on a nursing home, and honor older adults’ preference to age in place in their own homes and communities15. It is also important to note that the demand for the current stock of accessible and supportive housing units is so great that in order for the supply to ever meet the demand, existing housing supply modification must be a part of the solution. Physically supportive settings that provide accessibility outside and inside the dwelling unit as well as other adaptations play an important role in assisting frail older persons remain at home. Such features should be16:

a. Controllable by residents (e.g. individual thermostats at appropriate heights) b. Forgiving (e.g., carpeted floor surfaces that may reduce injuries from falls) c. Easy to use (e.g., places to sit while cooking) c. Supportive (e.g., grab bars and handrails) and d. Accessible (ramps, wide hallways and doorways, roll-in showers)

Such settings can make it easier for older persons to carry out daily tasks, enhance safety, increase socialization, and promote self-efficacy. Although the

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addition of supportive features in homes has been increasing, most existing housing stock still lacks features needed for seniors or adults with disabilities. There is a growing movement to build accessible and supportive housing in the first place to minimize the need for adaptation and to make all housing accessible to persons with disabilities. Two important concepts regarding housing accessibility include visitability and universal design. Visitability is a set of key accessibility features that facilitate basic access into a home and usually includes: Zero step entrance to the home, wide interior doors, a wide level route through the main floor, and at least one accessible bathroom on the main floor. Universally designed homes and neighborhoods are user-friendly for persons of all ages and supportive for those with temporary or permanent disabilities. The universal design of all products and environments should ensure usability by all persons to the greatest extent possible without the need for adaptation or specialized design. In terms of housing, universal design suggests such features as a zero step entrance, accessibility to all rooms in the house, extra wide doors and hallways, accessible bathrooms on all floors, backing for grab bars in showers and bathtubs, and lowered switches and outlets.

2. Statute Addressing Accessibility is Limited Government response to improving the suitability of conventional housing has been slow to evolve. The Fair Housing Amendments Act (FHAA) of 1988, the major piece of federal statute that requires basic accessibility (wide hallways and accessible bathrooms and kitchens) in housing settings, applies only to buildings with four or more dwelling units. The law calls for “reasonable accommodations” in existing multi-unit housing for persons with disabilities and allows tenants to make adaptations, but is vague on the responsibility of the owner to pay for changes, even in the common areas. The Act is administered locally and does not cover single-family homes. Because California’s population and housing stock continues to grow, it is an ideal state in which to incorporate the principles of universal design and visitability. Other states have set the example for an increased housing accessibility statute in California. State visitability legislation has passed in Texas, Georgia, Vermont, Minnesota and Kansas which requires visitability in single-family homes and in some cases, duplexes or triplexes built with state or federal funds. Currently, no city in California has adopted a visitability city ordinance. There are voluntary programs in Visalia, Livermore, and San Mateo County, and the issue is also being discussed in Modesto and Santa Monica. In 2002, Governor Davis signed AB 2787, which directs the Department of Housing and Community Development to develop universal design guidelines and develop at least one model universal design ordinance. This bill represents an important opportunity to increase not only accessibility but to create user-friendly housing for individuals of all ages.

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3. Loss of Important State Resources for Housing Accessibility The Senior Housing Information and Support Center (SHISC) in the Department on Aging (CDA) has been dismantled due to budget problems. SHISC was responsible for a statewide information clearinghouse on senior housing options and home modification resources. Its mission was to promote opportunities for Californians to live safely in their homes, with access to supportive community resources, throughout their lifetimes. Services included:

a. Resource Library on home improvement, community services, and senior housing options.

b. Information on funding sources for home modification and organizations that can help.

c. Education and training on home modifications for seniors and adults with functional impairments, and their families, as well as professionals in the field.

d. Public outreach to California communities on the importance of building collaborative partnerships that promote independence for seniors and adults with functional impairments. 4. Lack of Knowledge of Housing Accessibility Resources by Many Home and Community Based Services Providers The state and local agencies operate many fragmented home and community based services programs that enable very low-income elderly to remain in their homes as they age. Programs that offer case management and more comprehensive approaches to serving seniors often are missing linkages with the community resources on home modification. Multi-Purpose Senior Services Program (MSSP), an important resource for frail seniors currently does address this issue. Education on home modification, including Fair Housing Law and the American’s with Disabilities Act (ADA) would be valuable knowledge for any such local or state provider to have in order to encourage more accessible home environments for seniors and adults with disabilities.

5. Lack of State Resources for Home Modification California does not have any state sources of funding for home modification. Other states have successful sources of funding for this. The Minnesota Housing Finance Agency’s (MHFA) Fix Up Fund uses housing revenue bonds to assist homeowners in increasing the livability, accessibility, and energy efficiency of existing homes. The low-interest loans are made to homeowners by locally participating banks, credit unions, and housing agencies. The MHFA also has a separate $500,000 deferred payment Accessibility Loan program funded by state appropriations targeted at households of one or more persons with a long- term physical disability that substantially affects functioning in the home.

Statement of Findings on Housing Page 21 California Commission on Aging April, 2003

D. Appropriateness: Barriers to Providing Appropriate Housing 1. Gaps in the Continuum of Housing Seniors and adults with disabilities who are cognitively or physically impaired, but not in need of intensive medical services, can live in a variety of settings with supportive physical features and linkages to services, often costing less than nursing home care. Unfortunately for the individual in need of these options, choices have been limited due to gaps in the housing continuum and lack of appropriate geographic distribution (See Table 3.)

2. A Patchwork System of Programs Linking Housing and Services Senior housing is too often disconnected from support services. Historically, federal and state subsidized housing were intended for independent older persons. Yet as residents of senior housing grow older, their need for supportive services increases. Older Californians living in senior housing should not have to move or relocate in order to receive necessary health care and supportive services. The concentration of such senior housing residents offers opportunities to take advantage of economies of scale by targeting services. Consequently, some housing sponsors, along with service providers, have attempted to link housing and services; often by adding service coordinators, who assess resident needs and arrange for services Excellent targets for these service linkages include government-assisted housing developments and naturally occurring retirement communities (NORCs). NORCs are places that include high proportions of older people and are often located in older neighborhoods, private apartment complexes and mobile home parks. However, only a patchwork of these services exists in most areas.

Table 3. The Continuum of Housing Semi- Housing Options for the Elderly Independent Independent Dependent Community-based Single Family Housing X X X X X Community-Based Apartment Dwelling X X X X X X Granny Flat/Echo Housing/ Accessory Unit X X X X Shared Housing X X X X Retirement Community (Age 55+) X X X X X Age Segregated Apartment Dwelling X X X X Continuing Care Retirement Community (CCRC) X X X X X X X Congregate Housing (20+ units) X X X X Board and Care Home X X Assisted Living (Personal Care) Complex X X X Foster Care X X Intermediate Nursing Care X Pynoos, J. &Matsuoka, C. (2001). Housing and the Continuum of Care. In C. Evashwich, The Long-Term Continuum of Care. Albany, NY: Delmar-Thompson Learning.

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Housing should be an integral component of efforts to better integrate Home and Community Based Services Systems in California but it is often left out of the discussions. The physical environment along with supportive services are often key in an older persons’ ability to stay in the community and out of more costly institutional settings. For example, the lack of local land use planning and zoning with ‘smart growth’ principles (mixed land use, preserving open space, strengthening and directing development towards existing communities, creating a range of housing opportunities and choices, creating walkable neighborhoods, provide a variety of transportation choices) contributes to the disconnect between housing and services.

3. A Lack of Coordination Between Housing Long Term Care and Health Sectors There is a policy disconnect between housing, long term care, and health sectors that results in an inefficient use of resources and a lack of coordination. The Commission heard testimony that this was a particular problem in rural areas. Each sector has its own distinct financing systems and regulatory structures. Additionally, state actions at both the legislative and administrative level inhibit coordination by creating silos of services and supports for seniors.

4. A Stalemate on Affordable Assisted Living Assisted living is a viable alternative to nursing home care. Assisted living is a professionally managed residential long term care option that can meet the needs of frail older persons who need supervised care, personal care services, medication monitoring and services that can respond to their scheduled and unscheduled needs. Its rapid growth indicates the attractiveness of this option for older persons. Unfortunately, assisted living in California is an option that is out of reach for most low-income seniors due to the lack of reimbursement for this level of care. However, thirty-five states currently reimburse for assisted living services through Medicaid Home and Community Based Services Waivers (1915c). The states must assure the Centers for Medicare & Medicaid Services (CMS) that the reimbursement of assisted living facilities will not cost more than institutional care. For example, in Oregon, SSI is used to pay the cost of the housing and Medicaid covers reimbursement for services through a five-tiered rate scale depending on the type and degree of resident impairments. Another financing option that now also becoming possible is for Section 8 vouchers to pay for the shelter costs and Medicaid payments to cover services. The passage of an Assisted Living Waiver Demonstration Program (AB 499) in California was a step in the right direction. One million dollars was included in this year’s budget to develop the waiver request to the federal government. However, the Department of Health Services, charged with developing and implementing the waiver, is behind in implementing the pilot project which must address both issues of cost (the legislation says “The department shall not implement the waiver program if it will result in additional

Statement of Findings on Housing Page 23 California Commission on Aging April, 2003

costs to the state”) and quality of care. DHS has released a request for a consultant to work with the state on developing the waiver pilot project.

5. Under-utilization of Echo Housing, Small Group Homes for Persons with Alzheimer’s Disease and Adult Foster Care Programs In public discussions, the Commission heard testimony on the benefits of both echo housing (mother-in-law cottages), small group homes for persons with Alzheimer’s Disease and adult foster care programs. It was pointed out that local zoning barriers currently exist in many places that prevent the expansion of echo housing and special small homes for persons with Alzheimer’s Disease. While adult foster care model programs exist for seniors, especially in rural areas, they are not available across the state.

Sources

Statement of Findings on Housing Page 24 1US. Department of Housing and Urban Development: Office of Policy Development and Research (1999). The Challenge of Housing Security: Report to Congress on the Housing Conditions and Needs of Older Americans. Washington, D.C.: U.S. Department of Housing and Urban Development. 2AARP (1995). State Housing Profiles. Washington, DC: American Association of Retired Persons. 3 Rural Community Assistance Corporation (n.d.). Retrieved February 24, 2003 from http://www.rcac.org/corpinfo/annualreport/Housing.pdf. 4 California Budget Project (2002). Locked out 2002: California’s Affordable Housing Crisis Continues. California: California Budget Project. 5 California Senate Office of Research (1995). Beyond Bricks and Mortar: Issues Facing Senior Housing in California. California: California Senate Office of Research. 6 AARP (1995). State Housing Profiles. Washington, DC: American Association of Retired Persons. 7 Mikesell, J.J., Ghelfi, L.M., Salant, P., Wallace, G., Whitener, L.A. (1999). Meeting the housing needs of rural residents: Results of the 1998 survey of the USDA’s Single Family Direct Loan Housing Program. Washington D.C.: U.S. Department of Agriculture. 8 AARP (1996). Understanding Senior Housing: Into the Next Century: Survey of Consumer Preferences, Concerns, and Needs. Washington, DC: American Association of Retired Persons. 9 California Association of Homes and Services for the Aging (2000). 1999-2000 Affordable Senior Housing Survey. California Association of Homes and Services for the Aging. 10 Senior Action Network (2000). Two Bits For Housing: A Campaign to Develop More Affordable Senior Housing. California: Senior Action Network. 11 Williams, K.A. (2000). The Long Wait: The Critical Shortage of Housing in California. California: Corporation for Supportive Housing and Housing California. 12 Pynoos, J., Reynolds, S., Salend, E., & Rahman, A. (1995). Waiting for Federally Assisted Housing: A Study of the Needs and Experiences of Older Applicants. Washington D.C.: AARP. 13 Menzer, M.B.(2001). Housing Southern California: Smart Growth Strategies, Southern California Association of Governments State of the Region Report. Los Angeles: Southern California Association of Governments. 14 Center for Community Change, retrieved March, 2003 from: http://www.communitychange.org/htf %20what%20is.html. 15 Center for Universal Design (1997). A Blueprint for Action. North Carolina: Center for Universal Design, AND Mann, W.C., Ottenbacher, K.J., Fraas, L., Tomita, M., & Granger, C.V. (1999). Effectiveness of assistive technology and environmental interventions in maintaining independence and reducing home care costs for the frail elderly. Archives of Family Medicine 8, 210-217. 16 Pynoos, J., Matsouka, C., & Liebig, P. (2001). Housing for Older Californians: A policy report prepared for the California Policy Research Center for the Strategic Plan on Aging Series in compliance with SB 910.