Title
Planning Board Recommendation that the City Council Accept the City of Alameda Housing Element 2016 Annual Report and Implementation Priorities. The review of the annual report is exempt from the California Environmental Quality Act
Body
Planning Board Recommendation that the City Council Accept the City of Alameda Housing Element 2016 Annual Report and Implementation Priorities. The review of the annual report is exempt from the California Environmental Quality Act
To: Honorable President and
Members of the Planning Board
From: Andrew Thomas
Assistant Community Development Director
Date: March 13, 2017
BACKGROUND
Per Government Code § 65300 et seq., every city and county in California is required to maintain a General Plan. The statute requires that each city and county in California address issues that are of State-wide importance in the General Plan, and the State has determined that:
• Provision of housing for all segments of California society is a matter of statewide importance;
• Availability of an adequate supply of housing affordable to all segments of society is critical to the State's long-term economic competitiveness and quality of life; and
• Local zoning provisions play an important role in the State’s ability to provide housing.
The City of Alameda should also be ensuring that Alameda’s planning and development policies and regulations provide for the full range and diversity of housing types needed to accommodate California's diverse population, including seniors, families with disabilities, and lower income households.
In July of 2014, the City Council adopted an updated Housing Element for the period 2015-2023 consistent with the requirements of the State of California Government Code § 65300 et seq. The 2015 Housing Element and State Government Code require that the City report annually to the State of California, on forms provided by the State, on the City’s annual progress on Housing Element implementation. The required 2016 annual report has been completed and is attached as Exhibit 1.
Further, the 2016 Housing Element includes Program 1.1, which requires an annual public hearing by the Planning Board to consider the annual report to the State and
“...consider improvements to the development review process and requirements to ensure that processes and requirements do not create unnecessary costs or delays and increase the cost of housing in Alameda....“
Based upon the annual review, the Planning Board may recommend to the City Council any changes to the City’s development regulations necessary to support Housing Element implementation.
DISCUSSION
Based on staff’s annual review of housing development in Alameda, staff finds that:
• The City of Alameda is producing a diversity of housing types to meet its Regional Housing Needs Allocation (RHNA), including multifamily housing, senior housing, universally designed units, and housing for lower income households; and
• The City’s regulatory policies and ordinances and project review processes are not causing any undue constraint on housing development in Alameda, nor are they constraining housing development for any particular segment of the community.
The following sections describe the current housing being developed and a brief assessment of each of the major ordinances that govern housing development in Alameda.
Housing Construction Forecast: 2015-2023:
As the result of a robust regional housing market, strong Alameda community support for new housing opportunities to meet Alameda’s diverse housing needs, and the zoning amendments completed by the City in 2010 (Density Bonus Ordinance) and 2012 (site specific re-zonings and Multi-family Overlay Ordinance) to bring the City of Alameda zoning regulations into conformance with State Law, the City of Alameda’s regulatory structure and development review process is producing a variety of new housing units. If the existing economic conditions continue over the eight-year planning period, the City will exceed its eight-year RHNA of 1,725 units for the 2015-2023 period with the construction of over 1,840 units at the following sites:
• Oakmont- 25 multifamily attached flats
• Alameda Landing Tripoint Homes - 194 multifamily units, and 91 single family units
• Marina Shores - 39 multifamily and 50 single family
• Del Monte - 380 multifamily
• Eagle Avenue - 20 multifamily units (100% affordable)
• Alameda Point Site A - 800 multifamily units (25% affordable)
• 1435 Webster Street - 9 multifamily units
• 2100 Clement - 52 attached townhomes
• Boatworks (Clement) - 182 townhomes and single family homes
In addition to the housing construction pipeline projects listed above, the City has over 2,000 more units in the planning pipeline at the following sites:
• Encinal Terminal Master Plan Application - 589 multifamily units
• Alameda Marina Master Plan Application - 670 multifamily units
• Shipways Development Plan and Design Review Pre-application - 290 multifamily units.
• Alameda Point Main Street Neighborhood Plan - 260 additional units, including reconstruction of 200 Alameda Point Collaborative supportive housing units for formerly homeless households.
• North Housing - Federal public auction commences on April 12, 2017-zoned for 435 units.
Affordable Housing
In 2016, the City of Alameda made progress on three major affordable housing projects, including:
• Final land conveyance and commencement of construction for the 31-unit Del Monte Senior Affordable Housing project.
• Issuance of initial building permits for the residential project at 2100 Clement, which includes seven affordable housing units.
• Final Design Review approval for 128 very low- and low-income units at Alameda Point Site A. Once funding is secured, construction will begin.
• Final Design Review for 20 affordable units at Eagle Avenue. Funding has been securedand construction will commence in June 2017.
Design Review Ordinance
The Housing Element includes programs and policies (Program 1.3 and 3.1) that emphasize the need to expedite the development review process for projects that include affordable housing and special needs housing. Prioritizing and expediting the design review process for projects with affordable housing should continue.
In 2016, the Planning Board approved the final designs for the Eagle Avenue affordable housing project and the 2100 Clement Avenue project with nine affordable housing units. In both cases the Planning Board processed the design review applications without causing unnecessary delays for the development process.
Universal Design Ordinance
Housing Element Program 4.2 establishes the need for a Universal Ordinance to better serve the City’s senior population, residents that wish to "age in place", and the 16% of Alameda families that report living with a family member with a disability.
It is anticipated that the City Council will consider the Universal Design ordinance in spring or early summer 2017.
Inclusionary Housing Ordinance
Although not required by State law, the City of Alameda adopted an Inclusionary Housing Ordinance in 2003, which requires that 15% of all units in projects of 10 or more units must be deed-restricted for very low- (4%), low- (4%) and moderate-(7%) income households. Projects with between five and nine units can pay an in-lieu fee instead of providing affordable units.
In February 2017, the City Council prioritized review of the City’s inclusionary housing ordinance for the purpose of increasing the number of affordable housing that might be required in each housing project. Staff plans to hold a City Council workshop on the issue in April to further define the scope of the re-evaluation.
The State of California Department of Housing and Community Development (HCD) considers inclusionary zoning regulations to be a "constraint" on housing production because it places a financial burden on the for-profit housing development community, which provides the majority of the new housing in California. As a result, HCD requires that the City of Alameda annually review its ordinance to ensure that it is not constraining housing development. Given that the City is actively producing housing to exceed its RHNA obligation of 1,725 units, staff finds that the Inclusionary Housing Ordinance has not been a constraint on housing development in Alameda.
Over the last year, a number of residents have suggested that the City amend its ordinance to either increase the number of affordable housing units required in each development and/or add a new requirement for “middle-income” housing, that might include housing for households making between 120% and 180% of the area median income. Others have suggested that a more comprehensive update is needed to re-evaluate and potentially increase the 15% requirement.
The City’s current inclusionary requirement for 4% very low-, 4% low- and 7% moderate-income units ensures that each project does not automatically qualify for affordable housing density bonus and development standard waivers under the Density Bonus Ordinance. If a developer volunteers to provide, or the City requires 5% very low income, 10% low-income, or 10% moderate-income units, the City must provide the developer with specific density bonuses and waivers from City of Alameda development standards (e.g. height limits, open space requirements, etc.).
Over the last six years that the Density Bonus Ordinance has been in place, most developers in Alameda who have requested density bonuses and/or waivers, have chosen to increase their very low-income housing requirement by 1%, to 5%, which qualifies them for a 20% density bonus. Therefore, the number of affordable units is increased by 1%, the project size increases by 20%, and the overall percentage of affordable units in the project ends up being somewhere around 13%.
A new “middle-income” requirement could be added to the Inclusionary Ordinance, which would increase the City’s requirements over the existing 15% deed- restricted units, without changing the relationships between the Inclusionary Ordinance and the Density Bonus ordinance. (The new middle-income housing requirements would not “trigger” density bonuses.) Staff is currently recommending a 10% middle-income housing requirement as part of the Alameda Point Main Street Plan.
Additionally, the City could discuss changing the existing 15% requirement to change the relationship between the Inclusionary Ordinance and the Density Bonus Ordinance. Different ratio requirements could result in fewer or more density bonus applications or change the size of density bonuses granted.
Any discussions about future amendments will also need to consider the following factors:
• Since the market-rate units in the project subsidize the costs of the affordable units, an increase in the cost of housing development may result in higher housing costs (and sales price/rent) for the non-deed restricted units in each development.
• Increasing the inclusionary housing requirement could increase the cost of housing development such that it serves to reduce the private sector’s ability to produce housing, which could result in less market-rate and less affordable housing being constructed.
• The ordinance might be amended to allow more flexibility for senior affordable housing or more flexibility for creative partnerships with the Alameda Housing Authority.
• Any future amendments might consider new development standards related to home ownership and rental housing for low income households.
Initiating a public discussion of the Inclusionary Housing Ordinance, and then processing the necessary amendments through the public process will require a substantial commitment of City staff and City Planning Board, community, and City Council time and resources. For that reason, staff is proposing a City Council workshop in April to further refine and define the Council’s objectives and priorities.
Secondary Unit Ordinance
Housing Element Program 4.1 establishes the need to support secondary units for small households and seniors. Sometimes referred to as "in-law units" or "granny flats", these small one-bedroom or studio units built on properties that are already occupied by a single-family home in an existing neighborhood provide an excellent way for a community to add small, affordable units that are attractive to young residents, seniors, and/or residents with a disability.
In 2016, the City of Alameda did not add any secondary units to the housing stock. In 2017, the City of Alameda anticipates an increase in applications due to changes in State Law, which override the provisions in the local ordinance regarding off-street parking and minimum lot size.
Density Bonus Ordinance
In 1979, the State legislature enacted the Density Bonus Law (Government Code Sections 65915-65918) to address the shortage of affordable housing in California. The statute requires that when a developer offers to construct a certain percentage of the units in a housing development for low- or very low-income households, the city must, upon request of the developer, grant the developer one or more of the following:
• A density bonus to help cover the costs of the affordable units. State law specifies exactly how many additional units must be provided.
• Incentives and/or concessions from City standards to help cover the costs of the affordable housing.
• Waivers from city’s development standards, such as the AMC Section 30-53 Prohibition on Multifamily Housing, to enable the project to physically fit on the property.
In 2010, in compliance with State law, the City adopted Section 30-17 Density Bonus Ordinance. The provisions of the City's Density Bonus Ordinance are largely dictated by State law; therefore, the City is not able to fundamentally change any of the basic requirements.
To improve public understanding and implementation of the local ordinance, the Planning Board recommended, and the City Council adopted, a series of amendments to the ordinance in June 2015, related to the application submittal requirements.
At this time, staff does not have any suggested changes to the ordinance.
Parking Ordinance
Residential parking requirements for housing projects with five or more units continues to be a source of much debate and discussion for each project. The public review of each project must ensure that:
• The project does not provide too much parking, which increased development costs and encourages automobile ownership, use and traffic.
• The project provides enough parking for its residents so that the adjacent neighbors will not be impacted by the project.
Although these discussions have been difficult, and occasionally not everyone agrees with the final decision, these decisions have not been constrained or unreasonably restricted by the Parking Ordinance, because the Parking Ordinance allows the Planning Board and City Council to customize the parking plan for each project.
In 2017, staff anticipates that the Planning Board and City Council will re-evaluate and amend the parking requirements for accessory units and small residential additions.
Conclusion
Staff finds that the City is producing new housing consistent with its State of California RHNA obligations. Although the City is making progress to address housing needs, the City's regulatory framework governing housing development can continue to be improved to facilitate high quality, diverse, housing for the Alameda community. The implementation priorities for the next year should be:
• Continue to expedite the review of projects that include affordable housing,
• Complete the Universal Design Ordinance.
• Hold an Affordable Housing City Council Workshop.
ENVIRONMENTAL REVIEW
Approval of an annual report is not subject to review under the California Environmental Quality Act (CEQA), nor is an annual report defined as a “project” under CEQA. RECOMMENDATION
Recommend that the City Council approve the City of Alameda Housing Element Annual Report and Implementation Priorities.
Respectfully Submitted By:
Andrew Thomas, Assistant Community Development Director
Exhibit:
1. Annual Report