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HomeMy WebLinkAboutGP Amendment-Housing Element (PA2004-235)CITY OF NEWPORT BEACH PLANNING COMMISSION STAFF REPORT Agenda Item No. 3 March 3, 2005 TO: PLANNING COMMISSION FROM: PLANNING DEPARTMENT Tamara Campbell, Senior Planner (949) 644 -3238 team pbell(ftity.newoort-beach.ca.us Jaime Murillo, Assistant Planner (949) 644 -3209 imurilloacity .newport- beach.ca.us SUBJECT: General Plan Amendment (GP 2004 -010) Amendments to the Housing Element (PA 2004 -235) Adopt the attached resolution recommending approval of General Plan Amendment No. 2004 -010 to the City Council. DISCUSSION The Housing Element was adopted in August of 2003 and certified by the State Department of Housing and Community Development (HCD) in September of 2003. Since then, staff has discovered several discrepancies requiring revision for consistency and clarification, as well as the need to include additional provisions that could further promote affordable housing construction. The City Council initiated the proposed amendments to the Housing Element of the Newport Beach General Plan on November 23, 2004. These amendments include: 1) Amend Housing Program 1.2.1 to change the date of the annual General Plan report deadline to be consistent with State Law. 2) Amend Housing Program 2.1.1 to correct an erroneous reference to the Municipal Code. 3) Expand Housing Program 2.2.1 to include provisions for the production of housing for moderate- income households. Amendments to Housing Element March 3, 2005 Page 2 4) Provide consistency within the Housing Element when defining affordable income categories. 5) Amend the affordability standards to be consistent with the standards used by the State Department of Housing and Community Development and The Office of the Attorney General. Additionally, in accordance with the State's Housing Element Guidelines, the City has submitted to HCD, a 60-day notification of intent to adopt amendments to the Housing Element. The 60 -day review period ended on February 25, 2005 and, based on conversations with Housing Policy Analyst assigned to the City, the amendments are not anticipated to effect the certified status of the Housing Element. An update on HCD's final determination will be provided at the hearing. Analysis 1) Housing Program 1.2.1 is intended to implement California Government Code Section §65400 mandating annual reporting of the General Plan and the Housing Element. The program reads as follows: "As part of its annual General Plan Review, the City shall provide information on the status of all housing programs. The portion of the annual report discussing Housing Programs is to be distributed to the California Department of Housing and Community Development in accordance with California State law in January of each year via US Postal Service." However, California Government Code Section §65400(b)(2) actually requires that the report, "be provided to the legislative body, the Office of Planning and Research, and the Department of Housing and Community Development on or before October f of each year'; not in January of each year. Based on conversations between City staff and HCD staff, it was determined that this inconsistency should be corrected by amending Housing Program 1.2.1. This would ensure consistency with Government Code Section §65400 and clarify that one General Plan report should be prepared annually and submitted prior to October 15t of each year. 2) Housing Program 2.1.1 incorrectly refers to a particular chapter of the Municipal Code. The program reads as follows: "Maintain rental opportunities by restricting conversions of rental units to condominiums unless the vacancy rate in Newport Beach for rental housing is 5% or higher for four (4) consecutive quarters, and unless the property owner complies with condominium conversion regulations contained in Chapter 20.73 of the Newport Beach Municipal Code." Amendments to Housing Element March 3, 2005 Page 3 The Program inadvertently refers to a chapter of the Newport Beach Municipal Code that no longer exists. The program should be corrected to refer to Chapter 20.83 (Residential Condominium Projects), 3) Housing Program 2.2.1 is the statement of the City's inclusionary housing policy. The program requires the construction of very low- and low- income units (or the payment of an in -lieu fee) when construction of new units is proposed. In an effort to promote achievement of the City's housing goals, staff believes the program should be expanded to also provide for moderate income units. The existing program reads as follows: "Continue to require a proportion of affordable housing in new residential developments or levy an in -lieu fee. The City's goal over the five -year planning period is for an average of 20% of all new housing units to be affordable to very low- and low - income households. Given considerations of proper general planning, the California Environmental Quality Act, project development incentives, and government financial assistance, the City shall either, a) require the production of housing units affordable to very low- and low - income households, or b) require the payment of an in -lieu fee, depending on the following criteria for project size: 1. Projects where ten or fewer housing units are proposed shall be required to pay the in -lieu feels). 2. Projects where the proposal is for more than ten housing units, but fewer than fitly, shalt have the option of providing the units or paying the in- lieu feels). 3. Projects where more than fifty are proposed shall be required to provide the units. All required very low- and low - income units.shall be provided on site unless at an off -site location approved by the City. implementation of this program will occur in conjunction with City approval of any residential discretionary permits or Tentative Tract maps. To insure compliance with the 20% affordability requirements, the City will include conditions in the approval of discretionary permits and Tentative Tract Maps to require ongoing monitoring of those projects." The City's Regional Housing Needs Assessment (RHNA) sets forth the need for 83 moderate - income units and yet the Housing Element does not currently promote or provide incentives for this type of development. As such, amending the above housing program would further the City's possibilities in Amendments to Housing Element March 3, 2005 Page 4 accomplishing its RHNA goals in the moderate - income category. The amendment would simply add moderate - income households within this existing policy. 4) Within the discussion of Housing Affordability on Page 26, the Housing Element inadvertently includes inconsistent criteria for defining affordability income categories. The Housing Element incorrectly defines "Very Low Income" households as those households with annual incomes between 50- 80 percent of the County median household income and "Low Income" households as those households with annual incomes between 80 -100 percent of the County median household income. The Housing Element should define "Very Low Income" households as those households with annual incomes of 50 percent or less of the County median household income and "Low Income" households as those households with annual incomes between 50 -80 percent of the County median household income. The amendment will revise the affordability percentages accordingly. 5) Pages 67 and 68 of the Housing Element provide the base affordability standards for the purposes of defining income categories and their applicability. These standards were derived from a strict interpretation of Section 50093 of the State of California Health and Safety Code. Although technically correct, the standards create confusion when determining affordability requirements because both the State Attorney General and State HCD use a simplified version for defining income categories when determining the City s share of regional housing needs and for establishing program affordability requirements. Staff recommends amending the affordability standards within the Housing Element on pages 67 and 68 to follow the regulations of Title 25 (Housing and Community Development) of the California Code of Regulations, Sections 6910 through 6932. The income groups are defined as follows: Very Low - income: 50% or less of the area median income, as adjusted for family size by the United States Department of Housing and Urban Development. Low - income: 50 % -80% of the area median income, as adjusted for family size by the United States Department of Housing and Urban Development. Moderate- income: 80% -120% of the area median income, as adjusted for family size by the United States Department of Housing and Urban Development. Above Moderate- income: 120% + of the area median income, as adjusted for family size by the United States Department of Housing and Urban Amendments to Housing Element March 3, 2005 Page 5 Additional clarification and minor formatting changes are also proposed to the affordability standards applied to rental and ownership housing. All references to Section §50093 of the State of California Health and Safety Code will also be eliminated and replaced with a reference to §6932 of the California Code of Regulations. Incorporation of these standards will eliminate confusion and make the Housing Element consistent with the income categories and income limits used by both the Attorney General and State HCD. Environmental Review The proposed action is not defined as a project under the California Environmental Quality Act (CEQA) because it involves general policy and procedure making activities not associated with a project or a physical change in the environment (Section 15378 of the CEQA Guidelines). Public Notice Public notice for the March 3, 2005 hearing was printed in the Daily Pilot, in accordance with Section 65353 of the Government Code. Additionally, this item was included on the agenda for this meeting, which was posted at City Hall and on the City's web site. Alternatives The Planning Commission has the option to recommend changes to, or against, the proposed General Plan Amendment. P pared by: Tamara Ca bell Senior Planner, AICP Jaime Murillo Assistant Planner Submitted by: el�'Ni LiA Patricia Temple Planning Director Exhibit: 1. Draft Resolution No. 2005 _; findings for approval FAUSERS\PL"hared\PA's4PAs - 2004TA2004- 2351PCrpt030605.dao RESOLUTION NO. A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF NEWPORT BEACH RECOMMENDING ADOPTION OF GENERAL PLAN AMENDMENT NO. 2004- 010 RELATED TO HOUSING ELEMENT AMENDMENTS. (PA 2004 -235) WHEREAS, the Housing Element was adopted in August of 2003 and conditionally certified by the State Department of Housing and Community Development (HCD) in September of 2003. Since then, staff has discovered several discrepancies requiring revision for consistency and clarification; and WHEREAS, the City Council initiated amendments to the Housing Element of the Newport Beach General Plan on November 23, 2004 by adopting a written statement of intent; and WHEREAS, a public hearing was held by the Newport Beach Planning Commission on March 3, 2005 in the City Hall Council Chambers, 3300 Newport Boulevard, Newport Beach, California. A notice of time, place, and purpose of the meeting was given in accordance with the Municipal Code and State Law. Evidence, both written and oral, was presented to and considered by the Planning Commission at this meeting; and WHEREAS, additional provisions are also proposed to be included that could further promote affordable housing construction in the City; and WHEREAS, the proposed action is not defined as a project under the California Environmental Quality Act (CEQA) because it involves general policy and procedure making activities not associated with a project or a physical change in the environment (Section 15378 of the CEQA Guidelines). NOW, THEREFORE, BE IT RESOLVED Section 1. The Planning Commission hereby recommends that the City Council of the City of Newport Beach adopt General Plan Amendment No. 2004 -010 to revise the Housing Element to eliminate discrepancies and insure consistency within the text, clarify existing policies and affordability standards, and include provisions to promote the achievement of the City's housing goals, as shown in Exhibit A. �.Q City of Newport Beach Planning Commission Resolution No. _ Paoe 2 of 2 PASSED, APPROVED AND ADOPTED THIS 3RD DAY OF MARCH, 2005. BY: Larry Tucker, Chairman IM Jeffery Cole, Secretary AYES: NOES: EXHIBIT "A" Proposed Housing Element Changes 1) Housing Program 1.2.1 located on page 69 of. the Newport Beach Housing Element is hereby amended to read as follows: As part of its annual General Plan Review, the City shall provide information on the status of all housing programs. The portion of the annual report discussing Housing Programs is to be distributed to the California Department of Housing and Community Development in accordance with California State law on January prior to October 1st of each year via US Postal Service. 2) Housing Program 2.1.1 located on page 71 of the Newport Beach Housing Element is hereby amended to read as follows: Maintain rental opportunities by restricting conversions of rental units to condominiums unless the vacancy rate in Newport Beach for rental housing is 5% or higher for four (4) consecutive quarters, and unless the property owner complies with condominium conversion regulations contained in Chapter 29.73 20.83 of the Newport Beach Municipal Code. 3) Housing Program 2.2.1 located on page 72 of the Newport Beach Housing Element is hereby amended to read as follows: Continue to require a proportion of affordable housing in new residential developments or levy an in -lieu fee. The City's goal over the five -year planning period is for an average of 20% of all new housing units to be affordable to very low -, low -, and moderate- income households. Given considerations of proper general planning, the California Environmental Quality Act, project development incentives, and government financial assistance, the City shall either, a) require the production of housing units affordable to veFy mew and I very low -, low -, and moderate- income households, or b) require the payment of an in -lieu fee, depending on the following criteria for project size: 1. Projects where ten or fewer housing units are proposed shall be required to pay the in -lieu fee(s). 2. Projects where the proposal is for more than ten housing units, but fewer than fifty, shall have the option of providing the units or paying the in -lieu fee(s). S. 3. Projects where more than fifty are proposed shall be required to provide the units. All required YeFy l9w and Iew inGeme very low -, low -, and moderate - income units shall be provided on -site unless at an off -site location approved by the City. Implementation of this program will occur in conjunction with City approval of any residential discretionary permits or Tentative Tract maps. To insure compliance with the 20% affordability requirements, the City will include conditions in the approval of discretionary permits and Tentative Tract Maps to require ongoing monitoring of those projects. 4) The last paragraph on page 26 of the Newport Beach Housing Element is hereby amended to read as follows: In its. 1988 Regional Housing Needs Assessment, the Southern California Association of Governments calculated that of 4,431 lower- income households, paid more than 30% of their income for housing. According to SCAG estimates, 2,625 very low- income households and 1,806 low- income households paid more than 30% of their income for housing. In 1990, 2,583 very low- income and 4,071 low- income households paid more than 30% of their income for housing. "Low Income" households are those households with annual incomes between 80 - 190 pement 50 - 80 percent of the County median household income. "Very Low Income" households are those households with annual incomes of 59 — 89- perGeat 50 percent or less of the County median household income. 5) The income affordability standards defined on pages 67 and 68 of the Newport Beach Housing Element are hereby amended to read as follows: For purposes of defining income groups, the Housing Element uses the 9 Aseme table prepaFed by the State ef Galifamin OR With Wealth and Safety Gods SeGtien §50093 (§69093 Ta follows the reaulations fellewing income groups Ir -0114 ... M M - ■ M �•• E•• N• ■ MUNI- —110-1 ■•• and Urban Development. Low - income: 50%■ -80% of the area median income, as adiusted for and Urban Development. The following affordability standards shall apply to rental and ownership housing: • Maximum household income shall be determined by number of persons in a family or household_ and inGeme °" ^" be i GonfemanGe with the §50093 Table as fellews • Income shall be in conformance with the limits set forth in 25 C.C. R. G6932. • An efficiency unit as if occupied by one person; a one bedroom as if occupied by two persons; a two bedroom as if occupied by four persons; a three bedroom as if occupied by six persons; and a four bedroom as if occupied by eight. • Rents for very low -, low, mediaR and moderate - income households shall be no more than 30% of the income in limits set forth in 46932. The selling price of an ownership unit shall be no 16 more than 3 times the buyer's income. Units may be sold to buyers with qualifying incomes for the limited sales price without regard to the number of persons in the family. specific Goals, Policies, and Programs of the Year 2000 Newport Beach Housing Plan follow.