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HomeMy WebLinkAbout2024-73 - Approving and Adopting a Narrowly Focused Amendment to the Adopted and Certified 6th Cycle Housing Element for the 2021-2029 Planning Period (PA2022-0245)RESOLUTION NO. 2024-73 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH, CALIFORNIA, APPROVING AND ADOPTING A NARROWLY FOCUSED AMENDMENT TO THE ADOPTED AND CERTIFIED 6T" CYCLE HOUSING ELEMENT FOR THE 2021-2029 PLANNING PERIOD (PA2022-0245) WHEREAS, City Council Policy K-1 (General Plan and Local Coastal Program) requires amendments to the City of Newport Beach ("City") General Plan to be initiated by the City Council; WHEREAS, Section 65580 et seq. of the Government Code requires each city and county adopt a housing element that identifies and analyzes existing and projected housing needs within their jurisdiction and prepare goals, policies, and programs, and quantified objectives to further the development, improvement, and preservation of housing; WHEREAS, the City of Newport Beach ("City") 6th Cycle Housing Element for the 2021-2029 period ("Housing Element") presents a framework for meeting the housing needs of existing and future resident populations within Newport Beach based on the Regional Housing Needs Assessment ("RHNA") allocation of 4,845 new housing units; WHEREAS, the Housing Element was adopted by the City Council on September 13, 2022, and certified as statutorily compliant with State Housing Element Law on October 5, 2022, by the State Department of Housing and Community Development ("HCD"); WHEREAS, Charter Section 423 is described as a possible constraint in Section 3 (Housing Constraints, Resources, and Affirmatively Furthering Fair Housing), and further discussed as an implementation action in Section 4 (Housing Plan) of the 6th Cycle Housing Element; Resolution No. 2024-73 Page 2 of 5 WHEREAS, the 6th Cycle Housing Element Implementation must take effect by February 2025 to avoid significant penalties and loss of local control dictated by state law, which may include, but are not limited to: • Increased exposure to public and private litigation; • Loss of permitting authority; • Financial penalties, including monthly fines of up to $600,000; • Loss of eligibility for state and regional funding sources; • Court receivership; • Allowing housing developers to bypass the City's zoning requirements; and • Increased exposure to monitoring by the newly formed Housing Accountability Unit of HCD; WHEREAS, a public hearing was held on July 23, 2024, by the City Council to consider the Housing Element Implementation, including consideration of certifying the Program Environmental Impact Report ("PEIR"), adoption of CEQA Findings, Mitigation Monitoring and Reporting Program and a Statement of Overriding Considerations. A notice of time, place, and purpose of the hearing was given in accordance with CPUC Section 21676(b), California Sections 54950 et seq. ("Ralph M. Brown Act"), Chapters 20.62 (Public Hearings), 20.66 (Amendments), and 21.62 (Public Hearings) of the Newport Beach Municipal Code ("NBMC"), and City Council Policy K-1 (General Plan and Local Coastal Program) and City Council Policy K-3 (Implementation Procedures for the California Environmental Quality Act). Evidence both written and oral, was presented to, and considered by, the City Council at this hearing; WHEREAS, at the conclusion of the hearing, the City Council adopted Resolution No. 2024-58 to initiate a narrowly focused amendment to the Housing Element to remove the reference to Charter Section 423 from Sections 3 and 4 of the 6th Cycle Housing Element based on evidence presented at the hearing that voter approval is precluded by state law; WHEREAS, City staff published and circulated draft revisions to Section 3 (Housing Constraints, Resources, and Affirmatively Furthering Fair Housing) and Section 4 (Housing Plan) of the Housing Element ("Amendment") on July 26, 2024, that incorporates the legal basis for the removal of Charter Section 423 voter approval requirement to previously interested parties for a seven-day public review period, including The Kennedy Commission, People for Housing Orange County, Still Protecting Our Newport, The Public Law Center, and YIMBY Law; Resolution No. 2024-73 Page 3 of 5 WHEREAS, at the conclusion of the seven-day public review period, City staff transmitted the draft Amendment to HCD on August 2, 2024, for a formal review along with one piece of written correspondence received from Jim Mosher. No other correspondence was received in response to the published and circulated Amendment; WHEREAS, the City received a letter from HCD, attached hereto and incorporated by reference as Exhibit "A," on August 20, 2024, confirming the Amendment maintains the City's compliant status and, with its adoption, the Housing Element will remain certified as statutorily compliant; WHEREAS, a public hearing was held on September 5, 2024, in the Council Chambers at 100 Civic Center Drive, Newport Beach, California. A notice of time, place and purpose of the hearing was given in accordance with the Ralph M. Brown Act and 65353 of the Government Code and consistent with City Council Policy K-1 (General Plan and Local Coastal Program). Evidence, both written and oral, was presented to, and considered by, the Planning Commission at this hearing; WHEREAS, at the conclusion of the public hearing, the Planning Commission adopted Resolution No. PC2024-019 by a majority vote (5 ayes, 1 nay) recommending the City Council approve the Amendment to the Housing Element; and WHEREAS, a public hearing was held on September 24, 2024, by the City Council in the Council Chambers located at 100 Civic Center Drive, Newport Beach, California to consider amendment to the Housing Element. A notice of time, place, and purpose of the hearing was given in accordance with the Ralph M. Brown Act and City Council Policy K-1. Evidence both written and oral, was presented to, and considered by, the City Council at this hearing. NOW, THEREFORE, the City Council of the City of Newport Beach resolves as follows.. Section 1: The City Council hereby finds the Amendment is necessary and that the voter approval requirement set forth in Charter Section 423 is precluded by state law based on the Growth Management Measures set forth in the Amendment which is attached hereto as Exhibit "B," and incorporated herein by reference. The City Council does hereby approve the Amendment adopting the revised Housing Element, of which the affected portions are set forth in Exhibit "B." The City Council directs staff to transmit the Amendment to HCD for certification review. Resolution No. 2024-73 Page 4 of 5 Section 2: The recitals provided in this resolution are true and correct and are incorporated into the operative part of this resolution. Section 3: If any section, subsection, sentence, clause or phrase of this resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not affect the validity or constitutionality of the remaining portions of this resolution. The City Council hereby declares that it would have passed this resolution, and each section, subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared invalid or unconstitutional. Section 4: The City Council finds the Amendment is not subject to the California Environmental Quality Act ("CEQA") as set forth in the Public Resources Code Section 21000 et seq., Title 14, Division 6, Chapter 3 of the California Code of Regulations ("CEQA Guidelines"), and City Council Policy K-3 (Implementation Procedures for the California Environmental Quality Act) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines because it has no potential for resulting in physical change to the environment, directly or indirectly. The City Council finds the Amendment is exempt from CEQA environmental review pursuant to Class 21 as set forth in Section 15321 of the CEQA Guidelines which exempts actions that involve enforcement of a law, general rule, standard, or objective, administered or adopted by a regulatory agency. The Housing Element was adopted by the City Council on September 13, 2022, and certified as statutorily compliant with State Housing Element Law on October 5, 2022, by HCD as a framework for meeting the housing needs of existing and future resident populations within Newport Beach based on the RHNA allocation of 4,845 new housing units. The environmental impacts associated with the Housing Element were analyzed by way of the Housing Element Implementation Program Amendments Final PEIR (SCH No. 2023060699) discussed below. The Amendment does not result in any direct or indirect physical change to the environment. It simply removes the Charter Section 423 voter approval requirement of the Housing Element Implementation since it is precluded by state law. Additionally, the Amendment is categorically exempt under Section 15321. Charter Section 423 was described in Section 3 (Housing Constraints, Resources, and Affirmatively Furthering Fair Housing) of the Housing Element as a constraint on implementation of the Housing Element and possibly violative of the City's obligation to affirmatively further fair housing as set forth in California Government Code Section 8899.50 et seq. The 6t" Cycle Housing Element Implementation must take effect by Resolution No. 2024-73 Page 5 of 5 February 2025 to avoid significant penalties and loss of local control dictated by state law and described above. Since the Amendment involves the enforcement of a law, general rule, standard, or objective, administered or adopted by a regulatory agency, it is categorically exempt under Section 15321. Finally, the City Council hereby finds the adoption of this Amendment is covered under the Housing Element Implementation Program Amendments Final Program Environmental Impact Report. The Housing Element Implementation Program Amendments Final PEIR (SCH No. 2023060699) was prepared for the 6th Cycle Housing Element Implementation (also referred to as the "Project") in compliance with the California Environmental Quality Act ("CEQA"). On July 23, 2024, the City Council adopted Resolution No. 2024-50, to certify the PEIR as complete and adequate, inclusive of all required findings, a statement of overriding considerations, and a mitigation monitoring reporting program. The City Council hereby finds that the action to adopt this Resolution approving the Amendment was considered within the PEIR. Resolution No. 2024-50 is hereby incorporated by reference. Section 5: This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting the resolution. ADOPTED this 24th day of September, 2024. 1 1 Will O'Neill - ww Mayor ATTEST: o&,- 4. -N� Leilani I. Brown City Clerk APPROVED AS TO FORM: CITY TTORNEY'S OFFICE Aarbn C. Harp City Attorney Attachments: Exhibit A - HCD Letter Exhibit B - Housing Element Amendment EXHIBIT A HCD Letter S IAIF QV CALIFORNIA 8 1SIN SS ' N 1N1 -R SERV1CLS AND 1•IOLISIN ' AGENCY GAVIN NEWSOM GDyern' r DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT DIVISION OF HOUSING POLICY DEVELOPMENT 651 Bannon Street Sacramento. CA 95611 (916) 263-2911 i FAX (916) 263-?453 www.hcd.ra.onv August 20, 2024 Seimone Jurjis, Community Development Director Community Development Department City of Newport Beach 100 Civic Center Drive, Newport Beach, CA 92660 Dear Seimone Jurjis: RE: City of Newport Beach 6rh Cycle (2021-2029) Draft Housing Element Amendment Thank you for submitting the City of Newport Beach (City) draft amendment to the adopted housing element that was received for review on August 2, 2024, Pursuant to Government Code section 65585, subdivision (b), the California Department of Housing and Community Development (HCD) is reporting the results of its review. The City's housing element was found in compliance on October 5, 2022. The draft amendment incorporates modifications to Section 3: Housing Constraints, Resources, and Affirmatively Furthering Fair Housing and Section 4; Housing Plan, Housing Policy 1.1 Implementation Action - Adequate Sites to Accommodate 2021-2029 RHNA and will not negatively impact demonstrating adequate sites to accommodate the regional housing need allocation (RHNA) or the current compliance status of the housing element. Therefore, the element will remain in compliance with State Housing Element Law (Gov. Code, § 65580 et seq) when the draft amendment is adopted, submitted to and approved by HCD, in accordance with Government Code section 65585. Public participation in the development, adoption and implementation of the housing element is essential to effective housing planning. Throughout the housing element process, the City must continue to engage the community, including organizations that represent lower -income and special needs households, by making information regularly available while considering and incorporating comments where appropriate. Seimone Jurjis, Director Page 2 HCD appreciates the hard work and dedication provided in the preparation of the City's housing element and looks forward to receiving the County's adopted housing element. If you have any questions or need additional technical assistance, please contact me at Melinda.Coy )hcd.ca.aov. Sincerely, Melinda Coy Proactive Housing Accountability Chief EXHIBIT B Housing Element Amendment Section 1: Amend the Subsection entitled "Growth Management Measures" beginning on Page 3-28 within Section 3: Housing Constraints, Resources, and Affirmatively Furthering Fair Housing as follows: Growth Management Measures Growth management measures are techniques used by a government to regulate the rate, amount, and type of development. Growth management measures allow cities to grow responsibly and orderly, however, if overly restricted can produce constraints to the development of housing, including accessible and affordable housing. On November 7, 2000, the Newport Beach electorate approved Measure S, which amended the Newport Beach City Charter by adding Section 423. Charter Section 423 requires voter approval of certain major amendments of the Newport Beach General Plan, unless state or federal law precludes a vote of the electorate on the amendment. In the case of Charter Section 423, in general, a major amendment to the General Plan is defined as one that significantly increases allowed density or intensity by increasing over 100 peak hour trips (traffic), or over 40,000 square feet of floor area (intensity), or over 100 dwelling units (density) when compared to the General Plan prior to approval. These thresholds are calculated as the sum of the amendment itself and eighty percent (80%) of the increases resulting from other amendments affecting the same neighborhood that were adopted within the preceding ten (10) years. When the electorate approved Measure S, the electorate encouraged the City Council to adopt implementing guidelines that are consistent with the purpose and intent of Measure S; however, the Guidelines for Implementing Charter Section 423 do not provide guidance as to when a state or federal law precludes a vote on a major amendment of the General Plan. The City Council determines if a proposed amendment requires voter approval pursuant to Charter Section 423, based on the following conditions: • The Amendment modifies the allowed use(s) of the property or area that is the subject of the Amendment such that the proposed use(s) generate(s) more than one hundred (100) morning or evening peak hour trips than are generated by the allowed use(s) before the Amendment; or • The Amendment authorizes an increase in floor area for the property or area that is the subject of the Amendment that exceeds forty thousand (40,000) square feet when compared to the General Plan before approval of the Amendment; or • The Amendment authorizes an increase in the number of dwelling units for the property or area that is the subject of the Amendment that exceeds one hundred (100) dwelling units when compared to the General Plan before approval of the Amendment; or • The increase in morning or evening peak hour trips, floor area or dwelling units resulting from the Amendment when added to eighty percent (80%) of the increases in morning or evening peak hour trips, floor area or dwelling units resulting from Prior Amendments, within the preceding ten (10) years (see definition in Section 2J) exceeds one or more of the voter approval thresholds in Section 423 as specified in Subsection 1, 2 or 3. If the City Council determines a General Plan Land Use Element Amendment requires voter approval, after approving the Amendment, the City Council then adopts a resolution calling an election on the Amendment. The City Council schedules the election at the next regular municipal election, as specified by the City Charter. The City Attorney then prepares an impartial analysis of the Amendment, which contains information about the Amendment, any related project or land use approval, and the environmental analysis conducted that will help the electorate make an informed decision. In the absence of an ordinance or Charter provision that establishes a procedure for submittal of arguments or rebuttals relative to City measures, the City Council will adopt a resolution that authorizes the filing of arguments and rebuttals in accordance with the general procedures specified in the Elections Code. It is important to understand that Charter Section 423 only applies to General Plan amendments. Individual housing development projects that do not require a General Plan amendment are already accommodated within the General Plan and zoning framework. They would not be subject to Charter Section 423 and would never require a vote of the electorate. If a housing development project requires a General Plan amendment, any unit and peak hour traffic increases added to the project through bonus units awarded by the Density Bonus process are not counted toward Charter Section 423 thresholds and a determination whether a vote is required. Ultimately projects that require a vote of the electorate pursuant to Charter Section 423 may require additional costs and be subject to delays due to the election process that may yield uncertain election results. To implement the Housing Element, the City must move forward with adding housing units that would qualify as a major amendment for purposes of Charter Section 423, which raises the question whether a vote under Charter Section 423 is precluded by state or federal law. In recent legislation, such as Senate Bill 1333, the legislature has specifically found that the lack of affordable housing is a matter of statewide concern and that state housing laws related to land use, planning and zoning apply to charter cities. Similarly, the court in Anderson v. City of Son Jose (2019) 42 Cal.App.Sth 683, found that that the lack of affordable housing is a matter of statewide concern. To comply with state laws, the City must have a general plan, which serves as the long-range plan for future physical development in the community. (Government Code § 65000, et seq.) One of the mandatory elements of a general plan is a housing element, which must be updated by the City every eight (8) years and identify sites sufficient to meet the City's share of the Regional Housing Needs Assessment (RHNA) allocation. (Government Code §§ 65302, 65588, 65863.) In determining the RHNA allocation, the council of governments does not take into consideration any zoning or other local land use restrictions, such as Charter Section 423, but is directed by state law to "consider the potential for increased residential development under alternative zoning ordinances and land use restrictions." (Government Code § 65584.04(e)(2)(B).) Furthermore, the City has a continuing obligation to always ensure that adequate sites exist to accommodate lower -income housing development, not just at the beginning of the eight (8)-year Regional Housing Needs Allocation cycle. (Government Code § 65863.) In this RHNA cycle, the City has been allocated 4,845 new housing units. To comply with state law, the City must not only plan for these units, but the City must also take action to establish the appropriate zoning designations and development standards to allow the private market to develop these units. After developing a plan for these units, the City must submit the Housing Element to the Department of Housing and Community Development for them to find that the Housing Element is in compliance with state law. But having the California Department of Housing and Community Development find the City's Housing Element is compliant with state law is only one step of many. The City is then required to implement the Housing Element. Under Government Code Section 65585 (i)(1)(A), implementation is not optional, and the California Department of Housing and Community Development is charged with ensuring the City is implementing the Housing Element and taking action to revoke its finding that the Housing Element complies with state law if the City fails to implement the Housing Element. In addition to the loss of local zoning control, permitting authority, and fines of up to $600,000 per month for not having a compliant Housing Element, state law provides that the Attorney General may appoint an agent to take all necessary actions to bring the City into compliance with state law. (Government Code § 65585(I).) Because providing residential housing opportunity sites to accommodate the City's RHNA allocation is mandated by state law and the City is required to implement the Housing Element, a Charter Section 423 vote is precluded, and the City will move forward with implementing the Housing Element without a Charter Section 423 vote. Section 2: Amend the Subsection entitled "Implementation Actions" beginning on Page 4-2 within Section 4: Housing Plan as follows: Implementation Actions The City of Newport Beach has a total Regional Housing Needs Assessment (RHNA) allocation of 4,845 units. State law requires the City of Newport Beach to identify adequate sites to accommodate its fair share allocation for the 6th Cycle Housing Element. This City has identified a variety of candidate sites through extensive analysis in collaboration with the community and stakeholders through Newport Together's "Listen and Learn" process, multiple meetings of the City's Housing Element Update Advisory Committee (Committee), participation by interested residents at a variety of public meetings, workshops, and consultation with property owners. The City of Newport Beach has identified an adequate amount of land that was determined by the Committee as "Feasible" or "Potentially Feasible" for future development. Only a portion of these candidate sites will be necessary to accommodate the City's RHNA planning obligation. These sites have undergone a rigorous process to evaluate site features, development potential, developer/owner interest and other factors to deem them appropriate for housing during the 2021-2029 Planning Period. As part of the analysis of adequate sites, the City has comprehensively reviewed opportunity sites citywide and has identified eight primary areas of opportunity: • Airport Area Environs • Dover/Westcliff • West Newport Mesa • Newport Center • Banning Ranch • 5th Cycle Housing Element Sites • Coyote Canyon • Accessory Dwelling Units Since the City has identified several opportunity sites in the 51h Cycle Housing Element that will be utilized in the 6th Cycle Housing Element, additional policy considerations are stated in this Policy Program. These opportunities sites are described in map and tabular format in Appendix B of this Housing Element. Each of the opportunity areas described in this Housing Element have been assigned a targeted acreage, and a targeted number of new housing units (see following implementing Policy Action statements). Collectively, these targets must meet the unmet RHNA need as required by state law. It is expected there may be deviations from the targets with future implementing zoning actions. New opportunity sites may be identified, and other sites may be deemed unsuitable, or densities may be modified, all based on new information received over time. The City may adopt future zoning strategies that are more or less than the identified targets in this Housing Element provided the total unmet RHNA need by income category is accommodated within state -defined deadlines. If future zoning strategies deviate from the targets expressed in this Housing Element but still meet the requirement to identify adequate sites to accommodate unmet RHNA need, no amendment to the Housing Element would be required and deviations of any magnitude may be considered subject to the City Council's review and approval in consultation with the Community. For all Rezone Policy Actions 1A to 1F, Pursuant to Government Code 65583.2, subdivisions (h) & (i), which rezone sites to accommodate the City's shortfall in satisfying the RHNA, the City commits to the following: • permit owner -occupied and rental multifamily uses by -right for developments in which 20 percent or more of the units are affordable to lower -income households. By -right means local government review must not require a CUP, planned unit development permit, or other discretionary review or approval. • accommodate a minimum of 16 units per site; • require a minimum density of 20 units per acre; and • at least 50 percent of the lower -income need must be accommodated on sitesdesignated • for residential use only or on sites zoned for mixed uses that accommodate all of the very low and low-income housing need, if those sites: o allow 100 percent residential use, and o require residential use occupy 50 percent of the total floor area of a mixed -use project. 5788168.1 STATE OF CALIFORNIA } COUNTY OF ORANGE } ss. CITY OF NEWPORT BEACH } I, Leilani I. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the whole number of members of the City Council is seven; the foregoing resolution, being Resolution No. 2024-73 was duly introduced before and adopted by the City Council of said City at a regular meeting of said Council held on the 2411 day of September, 2024; and the same was so passed and adopted by the following vote, to wit: AYES: Mayor Pro Tern Joe Stapleton, Councilmember Noah Blom, Councilmember Robyn Grant, Councilmember Lauren Kleiman, Councilmember Erik Weigand NAYS None ABSTAIN: Mayor Will O'Neill ABSENT: Councilmember Brad Avery IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of said City this 25th day of September, 2024. C ill -47- ..-1.1 leo"V- Leilani I. Brown City Clerk ;W