The high cost of housing in Orange County presented a handicap for UC Irvine as it attempted to recruit talented faculty and administrative staff. So the leaders of state universities formed a nonprofit organization that built a sprawling suburban community called University Hills, criss-crossed by nature trails, lapped by Pacific breezes, and home to some of the best K-12 schools in the state.
Homes there are selling below market price, a boon for academics who otherwise could not afford to live in one of the country’s most expensive housing markets. But there’s a price: Strict resale rules mean buyers will never see a fraction of the capital gains compared to buying and selling on the open market.
Democratic Rep. Katie Porter bought a home in the faculty community in 2011 when she began teaching at UC Irvine Law School. She and her family have lived there since she was elected to Congress four years ago and took unpaid leave from university. Now her opponent in November’s election is calling Porter’s continued stay in faculty accommodation an “inside deal” because she no longer teaches at the UCI. Porter’s housing situation was first reported in an Associated Press article.
“Porter is a member of the House Oversight Committee. It turns out that oversight of their house has to be theirs,” said Scott Baugh, a former GOP lawmaker. “Insider trading like this is what’s wrong with Congress. When she was elected four years ago, she should have foregone this taxpayer-subsidized housing benefit.”
Porter’s campaign responded that she remains an unpaid employee of the university and abides by rules about who can live in faculty housing.
“As confirmed by the UCI, faculty who are on unpaid leave remain UCI employees and can keep their homes,” campaign spokesman Jordan Wong said. “Like other UCI faculty members who have taken sabbaticals, fellowships and visiting professorships, Rep. Porter has requested and granted unpaid leave in accordance with university policies.”
Here’s what voters need to know about Porter’s housing situation.
Where does Porter live?
University Hills, a housing development for full-time faculty and other eligible employees with 1,226 homes for sale and 384 rentals. The development came about because Orange County’s high housing costs made it difficult for UC Irvine to hire employees. Around two-thirds of the university’s faculty live on campus.
Academic institutions in expensive housing markets across the country have various programs to help faculty members afford homes, often with attractive mortgage packages. Some have faculty housing like UC Irvine, but University Hills is particularly spacious at more than 300 acres and offers many amenities.
What characterizes the development?
The homes are being sold at below-market prices set by the Irvine Campus Housing Authority, a nonprofit organization founded by the regents of the University of California in the 1980s. Homeowners do not own their land and pay a monthly ground lease, neighborhood association levy, and property taxes. Porter’s real estate and homeowner fees add up to a few hundred dollars a month, Wong said.
The housing authority requires that any apartment that is sold must be offered to the faculty, staff, or university in accordance with a housing authority document. Resale prices are capped well below market prices to help faculty and other university buyers and prevent University Hills homes from being bought as “speculative investment vehicles,” the document said.
Buyers can obtain mortgages from pre-approved lenders or the UC Office of Loan Programs, which provides financing for up to 90% of a home’s cost and charges no points or lender fees. (University Hills buyers pay standard closing costs.)
What are the specifics of Porter’s situation?
Porter was hired by the UC Irvine School of Law in 2009. She joined a housing waiting list and delayed entry to faculty until housing became available in 2011. She bought a four-bedroom home for $522,645 that year, according to the housing authority. According to the US Census, the median home value in Irvine at the time was $656,800.
Porter’s home was assessed by the housing authority in January 2021 with a maximum resale price of $659,369, an increase of $136,724 over the purchase price. In July, the median home price in Irvine was nearly $1.4 million, according to Redfin.
“Resale price restrictions prevent University Hills homes from serving as speculative investment vehicles,” the housing authority document said. “For those university related individuals whose primary goal in purchasing real estate is capital gain, it is strongly recommended that they consider purchasing a home in the unrestricted general market rather than in University Hills.”
Didn’t Porter leave the UCI faculty?
Porter was elected to Congress in 2018 and took office in January 2019.
The congresswoman took an unpaid leave of absence from UC Irvine but is still an employee, which entitles her to remain at the home, university spokesman Tom Vasich said. Employees on leave must reapply each year, and the decision to extend the leave of absence is at the discretion of the university management.
In addition to employees on unpaid leave, other people who live but do not teach at University Hills include retired faculty members and the spouses of deceased faculty members.
Did Porter receive special treatment?
Vasich said Porter’s situation is unique because the university has never before elected a member of its faculty to Congress. However, he said that in the past decade, eight other faculty members have taken unpaid leave of three years or more.
Is it appropriate for Porter to keep the case?
There are hundreds of waiting-listed faculty and staff available for purchase or lease at University Hills. The list includes university employees who have since bought homes and are therefore no longer eligible to purchase in the community, as well as people seeking condos, townhouses and other types of housing different from Porter’s four-bedroom home, Vasich said unclearly, how many are waiting for a home like the Congressman’s.
Porter’s campaign asked if she was denying a university employee affordable housing by choosing to stay in her home and said she was abiding by university rules.
“Per longstanding university policy, all faculty with approved unpaid leave for sabbaticals, scholarships, and visiting professorships, such as Rep. Porter, as well as professors emeritus, can remain in their University Hills residences,” Wong said.
Porter said if she loses her race in November, she will return to teaching at UC Irvine in January. She declined to say what she would do if she remains an elected official.
https://www.latimes.com/politics/story/2022-09-13/katie-porter-housing-agreement-with-uc-irvine Katie Porter faces criticism over her house at UC Irvine