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HomeMy WebLinkAboutPlanning Commission Resolution 2018-24 07/24/2018RESOLUTION 2018-24 CITY OF PETALUMA PLANNING COMMISSION RECOMMENDING THAT THE CITY COUNCIL ADOPT AMENDMENTS TO THE CITY'S INCLUSIONARY HOUSING PROGRAM, PROGRAM 4.3 IN THE CITY OF PETALUMA'S GENERAL PLAN 2025,2015-2023 HOUSING ELEMENT AS ADOPTED BY RESOLUTION NO. 2014-190 N.C.S. FOLLOWING HOUSING AND COMMUNITY DEVELOPMENT DEPARTMENT APPROVAL OF THE AMENDMENTS OR EXPIRATION OF THE TIME FOR HOUSING AND COMMUNITY DEVELOPMENT DEPARTMENT REVIEW OF THE AMENDMENTS WHEREAS, the California Planning and Zoning Law, Government Code Section 65000 et seq. ("Planning Law"), in Section 65300 requires California cities to prepare and adopt general plans to guide future development of the city, and specifies in Section 65302 the mandatory elements general plans must contain, including housing elements; and WHEREAS, Section 65585, subdivision (a) of the Planning Law requires consideration of guidelines adopted by the California State Department of Housing and Community Development ("HCD") in Health and Safety Code Section 50459 in the preparation of housing elements; and WHEREAS, Section 65588, subdivision (e) of the Planning Law prescribes the timetable for complying with housing element update requirements; and WHEREAS, on May 19, 2008, the City Council approved Resolution No. 2008-085 N.C.S., adopting the City of Petaluma General Plan 2025 ("General Plan"), which contained the City's then -existing housing element; and WHEREAS, on June 15, 2009, the City Council approved Resolution No. 2009-094 N.C.S., adopting the Petaluma 2009-2014 Housing Element; and WHEREAS, Section 65585 the Planning Law requires that local agencies submit proposed housing element amendments to the HCD for review 60 days prior to adoption, and requires that local legislative bodies consider HCD findings prior to adoption of housing element amendments, if such findings are made available within the 60 day review period, and permits local legislative bodies to adopt housing element amendments without HCD findings if they are not made available within the review period; and WHEREAS, HCD reviewed the Petaluma Housing Element 2015-2023 as presented to the Planning Commission on October 28, 2014, and determined that the element meets the requirements of the Planning Law; and WHEREAS, on December 1, 2014, the City Council approved Resolution No. 2014-190 N.C.S., adopting the Petaluma 2015-2023 Housing Element; and WHEREAS, on January 23, 2015, the HCD approved the 2015-2023 Housing Element as approved by the City Council; and WHEREAS, on November 2, 2015 the City Council approved Resolution No. 2015-171 N.C.S., adopting a First Amendment to the 2015-2023 Housing Element Program 4.3 to ensure consistency between the City's Housing Element and the holding in Palmer/Sixth Street Properties, L.P. v. City of Los Angeles, (2009) 175 CA 4th 1396, which held that the Costa -Hawkins Act, Civil Code section 1954.53(a), prohibits local agencies from requiring on-site inclusionary housing in rental housing developments; and Planning Commission Resolution No. 2018-24 Page 1 WHEREAS, recent amendments to the Planning Law pursuant to AB -1505, which took effect January 1, 2018 and are codified in sections 65850 and 65850.1, permit cities to adopt ordinances requiring inclusion of affordable residential units for moderate, low, very low, and extremely low income households in rental housing developments, and require that such ordinances provide alternate means of compliance that may include, but are not limited to, in -lieu fees, land dedication, off-site construction, or acquisition and rehabilitation of existing units, and grant HCD the authority to review certain such ordinances that require more than 15 percent of the total number of units in a residential rental development to be affordable to households earning 80 percent or less of area median income; and. WHEREAS, the 2015-2023 Housing Element as amended identifies and analyzes existing and projected housing needs and states goals and policies, and quantifies objectives and special programs for the reservation, improvement and development of housing in the City from 2015 through 2023; and WHEREAS, the City has 2,161 housing units in pipeline development but only 75 units are affordable in accordance with the City's inclusionary housing requirements; and WHEREAS, in -lieu fees collected by the City in accordance with Program 4.3 of the 2015-2023 Housing Element are insufficient to fund construction of sufficient numbers of affordable housing units to meet the City's projected housing needs; and WHEREAS, on February 12, 2018 the City Council held a workshop to discuss inclusionary housing policies and directed staff to prepare amendments to the 2015-2023 Housing Element and other legislative documents as needed to utilize the authority provided in AB -1505 to require construction of on-site inclusionary units in residential rental developments; and WHEREAS, the City contracted with Economic and Planning Systems (EPS) to complete a nexus study ("EPS Study") to identify funds the City could lawfully recover from inclusionary housing in lieu fees and to provide information and analysis in support of potential updates to the City's affordable housing in lieu fee; and, WHEREAS, EPS issued an administrative report in August 2017 that detailed a gap between market prices of housing in the City and prices affordable to very low, low, and moderate income households, and included a proposed per square foot in lieu fee for rental and ownership projects based on the affordability gap; and WHEREAS, it is the desire of the City Council to approve a Second Amendment to the inclusionary housing policy contained in the 2015-2023 Housing Element in accordance with the authority in AB -1505 to require on-site inclusionary housing units as part of residential housing development projects, both homeownership and rental, in the City to ensure the provision of affordable housing to help address the City's Regional Housing Need Allocation and the acute housing crisis in Sonoma County, and to provide for alternate means of compliance as AB -1505 requires; and WHEREAS, it is the desire of the City Council to increase the City's Inclusionary Housing In Lieu fee in accordance with the EPS Study to apply to developers of residential housing that the Council permits to make a payment in -lieu of providing affordable housing on site to more closely approach developers' fair -share responsibility toward contributing to implementing the City's 2015-2023 Housing Element policies and programs; and WHEREAS, the proposed Second Amendment to the 2015-2023 Housing Element is substantially consistent with the 2015-2023 Housing Element as adopted by the City Council on December 1, 2014, because it implements the same objectives; and WHEREAS, on December 1, 2014, the City Council adopted Resolution No. 2014-189 N.C.S. approving a negative declaration of environmental impacts for the 2015-2023 Housing Element, all in Planning Commission Resolution No. 2018-24 Page 2 accordance with the requirements of Public Resources Code Section 21000 et. seq. ("CEQA"), the CEQA Guidelines at 14 CFR 15000 et seq. ("CEQA Guidelines") and the City of Petaluma Environmental Review Guidelines; and WHEREAS, the proposed Second Amendment to the 2015-2023 Housing Element is categorically exempt from environmental review under Section 15061(b) (3) of the CEQA Guidelines because CEQA applies only to projects that have the potential for causing a significant effect on the environment, and it can be seen with certainty that there is no possibility that the proposed Second Amendment to the 2015-2023 Housing Element may have a significant effect on the environment, since the proposed amendment does not create changes in the physical environment, does not result in any changes to the General Plan or Implementing Zoning Ordinance land use policies, and any development that occurs in the future subject to such standards will undergo an independent analysis pursuant to the requirements of CEQA; and WHEREAS, on May 31, 2018, public notice of the June 12, 2018 public hearing before the Planning Commission to consider the proposed Second Amendment to the 2015-2023 Housing Element was published in the Argus Courier as an eighth page display ad in accordance with the requirements of Government Code sections 65090, 65091 and 65853; and WHEREAS, in accordance with Section 65585, subdivision (b)(2) of Planning Law, the public comments that the City has received regarding the proposed Second Amendment to the 2015-2023 Housing Element have been collected and provided to the members of the Planning Commission; and WHEREAS, on June 12, 2018, the Planning Commission held a duly noticed public hearing to consider the proposed Second Amendment to the 2015-2023 Housing Element and after discussion continued the item to a date uncertain to provide time for further discussion at a joint workshop of the City Council and Planning Commission; and WHEREAS, on July 9, 2018, the City Council and Planning Commission held a duly noticed joint workshop to consider amendments to the City's inclusionary housing program; and WHEREAS, on July 12, 2018, public notice of the July 24, 2018 public hearing before the Planning Commission to consider the proposed Second Amendment to the 2015-2023 Housing Element was published in the Argus Courier as an eighth page display ad in accordance with the requirements of Government Code sections 65090, 65091, and 65853; and WHEREAS, in accordance with Section 65585, subdivision (b)(2) of Planning Law, the public comments that the City has received regarding the proposed Second Amendment to the 2015-2023 Housing Element have been collected and provided to the members of the Planning Commission, and WHEREAS, on July 24, 2018, the Planning Commission held a duly noticed public hearing to consider the proposed Second Amendment to the 2015-2023 Housing Element. NOW, THEREFORE, BE IT RESOLVED by the Planning Commission of the City of Petaluma as follows: 1. The above recitals are true and correct and are incorporated into this resolution as findings of the Petaluma Planning Commission, 2. The Planning Commission recommends that following HCD approval of the proposed Second Amendment to the 2015-2023 Housing Element or expiration of the time for HCD review of the proposed amendment that the City Council consider and adopt following a public hearing a resolution adopting a Second Amendment to the 2015-2023 Housing Element substantially in accordance with that attached as Exhibit A to this resolution. Planning Commission Resolution No. 2018-24 Page 3 3. The Clerk of the Commission and/or City staff are authorized and directed to submit the attached draft resolution for HCD review and approval in accordance with Section 65585, subdivision (b) (1) of the Planning Law. ADOPTED this 24th day of July, 2018, by the following vote: Commission Member Aye No Absent Abstain Councilmember Healy X Chair Marzo X Vice Chair Alonso X Bauer X Benedetti- Petnic X Gomez X Wolpert X ATTEST: '. &F-4, H her Hines, Com sion Secretary Scott Alonso, Vice Chair APPROVED AS TO FORM: Lisa Tennenbaum, Ass' Cant City Attorney Planning Commission Resolution No. 2018-24 Page 4 Exhibit A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PETALUMA AMENDING THE CITY'S INCLUSIONARY HOUSING PROGRAM, PROGRAM 4.3 IN THE CITY OF PETALUMA'S GENERAL PLAN 2025, 2015-2023 HOUSING ELELMENT AS ADOPTED BY RESOLUTION NO. 2014-190 N.C.S. WHEREAS, the California Planning and Zoning Law, Government Code Section 65000 et seq. ("Planning Law"), in Section 65300 requires California cities to prepare and adopt general plans to guide future development of the city, and specifies in Section 65302 the mandatory elements general plans must contain, including housing elements; and WHEREAS, Section 65585, subdivision (a) of the Planning Law requires consideration of guidelines adopted by the California State Department of Housing and Community Development ("HCD") in Health and Safety Code Section 50459 in the preparation of housing elements; and WHEREAS, Section 65588, subdivision (e) of the Planning Law prescribes the timetable for complying with housing element update requirements; and WHEREAS, on May 19, 2008, the City Council approved Resolution No. 2008-085 N.C.S., adopting the City of Petaluma General Plan 2025 ("General Plan"), which contained the City's then -existing housing element; and WHEREAS, on June 15, 2009, the City Council approved Resolution No. 2009-094 N.C.S., adopting the Petaluma 2009-2014 Housing Element; and WHEREAS, Section 65585 of the Planning Law requires that local agencies submit proposed housing element amendments to HCD for review 60 days prior to adoption, and requires that local legislative bodies consider HCD findings prior to adoption of housing element amendments, if such findings are made available within the 60 day review period, and permits local legislative bodies to adopt housing element amendments without HCD findings if they are not made available within the review period; and WHEREAS, HCD reviewed the Petaluma Housing Element 2015-2023 as presented to the Planning Commission on October 28, 2014, and determined that the element meets the requirements of the Planning Law; and WHEREAS, on December 1, 2014, the City Council approved Resolution No. 2014-190 N.C.S., adopting the Petaluma 2015-2023 Housing Element; and WHEREAS, on January 23, 2015, the HCD approved the 2015-2023 Housing Element as approved by the City Council; and WHEREAS, on November 2, 2015 the City Council approved Resolution No. 2015-171 N.C.S., adopting a First Amendment to the 2015-2023 Housing Element Program 4.3 to ensure consistency between the City's Housing Element and the holding in Palmer/Sixth Street Properties, L.P. v. City of Los Angeles, (2009) 175 CA 4th 1396, which held that the Costa -Hawkins Act, Civil Code section 1954.53(a), prohibits local agencies from requiring on-site inclusionary housing in rental housing developments; and WHEREAS, recent amendments to the Planning Law pursuant to AB -1505, which took effect January 1, 2018 and are codified in sections 65850 and 65850. 1, permit cities to adopt ordinances requiring inclusion of affordable residential units for moderate, low, very low, and extremely low income households in rental housing developments, and require that such ordinances provide alternate means of compliance that may include, but are not limited to, in -lieu fees, land dedication, off-site Planning Commission Resolution No. 2018-24 Page 5 construction, or acquisition and rehabilitation of existing units, and grant HCD the authority to review certain such ordinances that require more than 15 percent of the total number of units in a residential rental development to be affordable to households earning 80 percent or less of the area median income; and WHEREAS, the 2015-2023 Housing Element as amended identifies and analyzes existing and projected housing needs and states goals and policies, and quantifies objectives and special programs for the reservation, improvement and development of housing in the City from 2015 through 2023; and WHEREAS, the City has 2,161 housing units in pipeline development but only 75 units are affordable in accordance with the City's inclusionary housing requirements; and WHEREAS, in -lieu fees collected by the City in accordance with Program 4.3 of the 2015-2023 Housing Element are insufficient to fund construction of sufficient numbers of affordable housing units to meet the City's projected housing needs; and WHEREAS, on February 12, 2018 the City Council held a workshop to discuss inclusionary housing policies and directed staff to prepare amendments to the2015-2023 Housing Element and other legislative documents as needed to utilize the authority provided in AB -1505 to require construction of on-site inclusionary units in residential rental developments; and WHEREAS, the City contracted with Economic and Planning Systems (EPS) to complete a nexus study ("EPS Study") to identify funds the City could lawfully recover from inclusionary housing in lieu fees and to provide information and analysis in support of potential updates to the City's affordable housing in lieu fee; and, WHEREAS, EPS issued an administrative report in August 2017 that detailed a gap between market prices of housing in the City and prices affordable to very low, low, and moderate income households, and included a proposed per square foot in lieu fee for rental and ownership projects based on the affordability gap; and WHEREAS, it is the desire of the City Council to approve a Second Amendment to the inclusionary housing policy contained in the 2015-2023 Housing Element in accordance with the authority in AB -1505 to require on-site inclusionary housing units as part of residential housing development projects, both homeownership and rental, in the City to ensure the provision of affordable housing to help address the City's Regional Housing Need Allocation and the acute housing crisis in Sonorna County, and to provide for alternative means of compliance as AB -1505 requires; and WHEREAS, it is the desire of the City Council to increase the City's Inclusionary Housing In -Lieu fee in accordance the EPS Study to apply to developers of residential housing that the Council permits to make a payment in -lieu of providing affordable housing on site to more closely approach developers' fair -share responsibility toward contributing to implementing the City's 2015-2023 Housing Element policies and programs; and WHEREAS, the proposed Second Amendment to the 2015-2023 Housing Element is substantially consistent with the 2015-2023 Housing Element as adopted by the City Council on December 1, 2014, because it implements the same objectives; and WHEREAS, on December 1, 2014, the City Council adopted Resolution No. 2014-189 N.C.S. approving a negative declaration of environmental impact of the 2015-2023 Housing Element, all in accordance with the requirements of Public Resources Code Section 21000 et. seq. ("CEQA"), the CEQA Guidelines at 14 CFR 15000 et seq. ("CEQA Guidelines") and the City of Petaluma Environmental Review Guidelines; and Planning Commission Resolution No. 2018-24 Page 6 WHEREAS, the proposed Second Amendment to the 2015-2023 Housing Element is categorically exempt from environmental review under Section 15061(b) (3) of the CEQA Guidelines because CEQA applies only to projects that have the potential for causing a significant effect on the environment, and it can be seen with certainty that there is no possibility that the proposed Second Amendment to the 2015-2023 Housing Element may have a significant effect on the environment, since the proposed amendment does not create changes in the physical environment, does not result in any changes to the General Plan or Implementing Zoning Ordinance land use policies, and any development that occurs in the future subject to such standards will undergo an independent analysis pursuant to the requirements of CEQA; and WHEREAS, on May 31, 2018, public notice of the June 12, 2018 public hearing before the Planning Commission to consider the proposed Second Amendment to the 2015-2023 Housing Element was published in the Argus Courier as an eighth page display ad in accordance with the requirements of Government Code sections 65090, 65091 and 65853; and WHEREAS, in accordance with Section 65585, subdivision (b) (2) of Planning Law, the public comments that the City received regarding the proposed Second Amendment to the 2015-2023 Housing Element were collected and provided to the members of the Planning Commission; and WHEREAS, on June 12, 2018, the Planning Commission held a duly noticed public hearing to consider the proposed Second Amendment to the 2015-2023 Housing Element and after discussion continued the item to a date uncertain to provide time for further discussion at a joint workshop of the City Council and Planning Commission; and WHEREAS, on July 9, 2018, the City Council and Planning Commission held a duly noticed joint workshop to consider amendments to the City's inclusionary housing program; and WHEREAS, on July 12, 2018, public notice of the July 24, 2018 public hearing before the Planning Commission to consider the proposed Second Amendment to the 2015-2023 Housing Element was published in the Argus Courier as an eighth page display ad in accordance with the requirements of Government Code sections 65090, 65091, and 65853; and WHEREAS, in accordance with Section 65585, subdivision (b)(2) of Planning Law, the public comments that the City has received regarding the proposed Second Amendment to the 2015-2023 Housing Element have been collected and provided to the members of the Planning Commission; and WHEREAS, on July 24, 2018, the Planning Commission held a duly noticed public hearing to consider the proposed Second Amendment to the 2015-2023 Housing Element and adopted a resolution recommending the City Council amend, subject to HCD approval, the City's Inclusionary Housing Program, Program 4.3 in the City of Petaluma's General Plan 2025, 2015-2023 Housing Element; and WHEREAS, in accordance with Resolution No. 2018-24 adopted by the Planning Commission on July 24, 2018, and the requirements of Section 65585, subdivision (b) (1) of the Planning Law, the Clerk of the Commission and/or City staff have submitted the proposed Second Amendment to the 2015-2023 Housing Element to HCD for review and approval; and WHEREAS, HCD has either responded regarding the proposed Second Amendment to the 2015- 2023 Housing Element or the HCD review period has expired without the City receiving a response; and WHEREAS, on XXXXXX, public notice of the XXXXXX, 2018 public hearing before the City Council to consider the proposed Second Amendment to the 2015-2023 Housing Element was published in the Argus Courier as an eighth page display ad in accordance with the requirements of Government Code sections 65090, 65091 and 65853; and Planning Commission Resolution No. 2018-24 Page 7 WHEREAS, in accordance with Section 65585, subdivision (b)(2) of Planning Law, the public comments that the City received regarding the proposed Second Amendment to the 2015-2023 Housing Element were collected and provided to the members of the City Council; and WHEREAS, on XXXXXX, 2018, the City Council held a duly noticed public hearing to consider the proposed Second Amendment to the 2015-2023 Housing Element, the public comments received and any findings provided by HCD; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma as follows: 1. The above recitals are true and correct and are incorporated into this resolution as findings of the City Council. 2. The Second Amendment to the 2015-2023 Housing Element is exempt from CEQA pursuant to Section 15061(b) (3) of the CEQA Guidelines because CEQA applies only to projects that have a potential for causing a significant effect on the environment and adoption of the Second Amendment to the 2015-2023 Housing Element does not create changes to the physical environment. 3. Based on the findings and conclusions contained in this resolution, the City Council finds it in the public interest to amend, and hereby amends Program 4.3 of the City of Petaluma 2015-2023 Housing Element in Chapter 1 1 of the City's General Plan 2025 to read as follows: Program 4.3: a. By provisions incorporated into the City's Implementing Zoning Ordinance, require residential projects, both homeownership and rental projects consisting of five or more units to provide 15% of the number of units in the project on-site as affordable housing with affordability restrictions of at least a 45 year duration for homeownership developments and affordability restrictions for of at least a 55 year duration for rental developments. b. The City Council in its sole discretion may approve alternative compliance in one of the following forms: i. Donation of a portion of the project site or an off-site property to the City or a non-profit organization deemed acceptable by the City for development of affordable housing; or ii. Payment of a fee in -lieu of providing affordable housing on site established by the City's adopted fee schedule; or iii. Use of an alternative method, such provision of a smaller percentage of on-site units, and/or donation of a separate parcel of land for development of affordable housing to otherwise satisfy the objectives of the City's inclusionary policies reflected in this program. 4. Except as amended herein, the City of Petaluma 2015-2023 Housing Element continues unchanged and in full force and effect. 5. Submission to HCD. Staff is directed to submit the Housing Element amendment pursuant to this resolution to HCD for approval in accordance Section 65585, subdivision (g) of the Planning Law. 6. Effective Date. This amendment shall take effect thirty days from the date of its adoption pursuant to State law, including Midway Orchards v. County of Butte (1990) 220 Cal.App.3d 765, 778 and DeVita v. County of Napa (1995) 9 Cal, 4th 763, 787, fn. 9. Planning Commission Resolution No. 2018-24 Page 8