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Home My WebLink About01 - Minutes - AmendedFebruary 14, 2023 CITY OF NEWPORT BEACH Agenda Item No. 1 City Council Meeting Minutes Study Session and Regular Meeting January 24, 2023 I. ROLL CALL - 4:00 p.m. Present: Mayor Noah Blom, Mayor Pro Tem Will O'Neill, Council Member Brad Avery, Council Member Robyn Grant, Council Member Lauren Kleiman, Council Member Joe Stapleton, Council Member Erik Weigand II. CURRENT BUSINESS SS1. Clarification of Items on the Consent Calendar - None SS2. Inclusionary Housing Ordinance Community Development Director Jurjis, Principal Planner Murillo, and Kathy Head, President of Keyser Marston Associates, reported on the State mandates for the construction and development of affordable housing, required Inclusionary Housing Ordinance for affordable housing minimums, and voluntary density b9pus provision; and utilized a presentation to discuss inclusionary housing, provide a background, the Regional Housing Needs Allocation (RHNA) fulfillment tool, density bonus, the City's previous Inclusionary Housing ordinance, financial evaluation parameters(www.newportbeachca.gov/inclusionary), pro forma evaluation tests, supportable requirements for rental and ownership projects, examples within Southern California, and a summary for a possible ordinance for the City. if Mayor Pro Tem O'Neill questioned whether a study exists that demonstrates whether Inclusionary Housing Ordinances lead to more housing production and noted research by Fellow Manhattan Institute fellow Conner Harris that finds the opposite occurs within California communities, provided an example of in -lieu fees, expressed concern for the study dates and increased construction from State regulations, and noted the opportunity to study ordinances from other cities. In response t 11Vlayor Pro Tem O'Neill's question, Principal Planner Murillo and Ms. Head clarified the calculation process for determining the per market rate. Mayor Pro Tem O'Neill expressed concern regarding project plans and preferred to continue gathering information from other cities. Through the example of in -lieu fees at Newport Center, Principal Planner Murillo clarified the recommendation to take the lowest fee and apply it across the board. In response to Council Member Avery's question, Ms. Head discussed an informal study she conducted of four California cities with inclusionary housing that showed no discernable pattern, and the key to a successful Inclusionary Housing Ordinance is to moderate and balance the requirement. Council Member Avery noted the importance of staying in touch with the development industry, getting feedback about what is doable, an awareness of the risk involved in development, and land value challenges. In response to Council Member Weigand's question, Principal Planner Murillo clarified that the use of an Inclusionary Housing Ordinance is at the discretion of Council, 13 Orange County cities have completed their RHNA, and highlighted the State's focus. Council Member Weigand expressed the opinion that more expert feedback should be collected and a second Council study session should take place. Council Member Grant concurred with Council Member Weigand's comments, expressed disappointment for the lack of funding to meet the RHNA numbers and, in response to her Volume 65 - Page 471 City of Newport Beach City Council Meeting January 24, 2023 question, Principal Planner Murillo noted that standards and guidelines for the use of Affordable Housing Funds will be included in the draft Inclusionary Housing Ordinance and noted how in -lieu fees have been used in the past. Council Member Kleiman diseussed tl}e importanee of the by right density bonus law + S P'o-AN income housi noted the importance of recognizing that the state -mandated by - right density bonus laws, which incentivize developers to propose projects that include affordable housing, are already in effect. In response to Council Member Weigand's questions, Ms. Head noted the legislature allowed inclusion of rentals beginning in 2017 and that the Inclusionary Housing Ordinance can include properties for rent and for sale. Mayor Blom discussed the City's geographic challenges, believed the City can use its inventiveness to create profitable venue opportunities, expressed interest in discussing new ideas, noted success with density bonuses in the airport aree, and would like to wait and see. Jim Mosher expressed the opinion that a clearer agenda would have given the new Council Members a chance to review this topic in advance, expressed confusion regarding the terminology of the in -lieu threshold and staffs proposal, expressed concern relative to the by -right approach for 50 units or more, and inquired whether an estimate exists of the total number of units the City is expected to build over the nekt eight years to meet the RHNA requirements and how the proposed ordinance will affect the number. ill Adam Wood, Building Industry Association, reminded✓Council that other development impact fees will increase the total cost of and )mrden on development, impacts on interest rates, and noted the industry is facing hardship. He discussed the Santa Ana case study and expressed the opinion that more studies would be beneficial. Larry Tucker expressed the opinligthat Council should gather information from the development community a tated that density bonus has been effective for generating units throughout the City. ak Nancy Scarbrough discussed evelopment scenarios using 5% and 15% inclusionary housing, noted the complexity of this topic, and supported taking more time to work it through. rqqw Mayor Blom gained consensus from Council to ruminate on the item and return to staff with guidance. VF III. PUBLIC COMMENTS Jim Mosher thanked the City Attorney for adding information to the agenda regarding Closed Session Item IV.C, and suggested a future agenda item to clarify and review the role of Hearing Officers. Ida Wolff provided a handout and requested that the Ben Carlson statue be removed. City Attorney Harp announced that the City Council would adjourn to Closed Session to discuss the items listed on the Closed Session agenda and read the titles, and reported that the City Manager, City Attorney, and City Clerk will not be participating in Closed Session Item IV.B.2 due to potential impact on their finances. IV. CLOSED SESSION — After Study Session — Council Chambers Conference Room A. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code § 54956.8): 1 matter Volume 65 - Page 472 City of Newport Beach City Council Meeting January 24, 2023 MISCELLANEOUS 11. Planning Commission Agenda for the January 19, 2023 meeting [100-20231 Receive and file. 12. Budget Amendment to Accept a Check from the California State Library for Literacy Services (CLLS) and Appropriate Funds to the Library's FY 2022-23 Budget [I00-20231 a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) Accept a check in the amount of $43,022 from the California State Library for Literacy Services (CLLS) and approve Budget Amendment No. 23-045 to increase expenditures by the same amount in the Literacy accounts. 13. Grants and Donations Report for the Quarter Ending December 31, 2022 [I00-20231 a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) Receive and file. 1 14. Status on Planning Commission's Efforts elated to Fractional Homeownership (PA2022-0202) [100-20231 Receive and file. Motion by Mayor Pro Tem O'Neill, seconded by Council Member Stapleton, to approve the Consent Calendar; and noting the amendments to Item 1. The motion carried unanimously. ` XVI. ITEMS REMOVED FROM THE CONSEN ALENDAR — None XVII. PUBLIC COMMENTS ON N -AGEND ITEMS Joe Ferrino believed document"Wissing related to the 2224 Marine Avenue development and expressed concern relative to the approval. Cathy Gilbert informed Council that the St. Andrews Presbyterian Church prayer group i€is praying for them. Joseph Kogon and Jessica Penunuri requested lights to be added to the Bonita Canyon Sports Park pickleball courts. Dennis McGavack discussed the growing popularity of pickleball and asked for lights to be added at the Bonita Canyon Sports Park pickleball courts. Jackson Creamer relayed the enjoyment he experiences from playing pickleball and asked Council to add lights to the Bonita Canyon Sports Park pickleball courts. George Egawa complimented Jackson for his presentation and discussed the passion for the sport by the pickleball community in the area. In response to Mayor Pro Tem O'Neill's question, th-&-Mr. Og-aw?,-Egawa relayed that he spoke with the Recreation and Senior Services Department, but Mayor Pro Tem O'Neill suggested he speak directly with Recreation and Senior Services Director Levin. Volume 65 - Page 477