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Item 4 - Addendum with Attachments PREPARED BY: JENNIFER ARMER, AICP Senior Planner 110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832 www.losgatosca.gov MEETING DATE: 1/7/2021 ITEM: 4 TOWN OF LOS GATOS GENERAL PLAN UPDATE ADVISORY COMMITTEE REPORT REPORT DATE: January 6, 2021 TO: General Plan Update Advisory Committee FROM: Joel Paulson, Community Development Director SUBJECT: Review and Discussion of the Revised Initial Draft of the Land Use Element and the Revised Initial Draft of the Community Design Element. REMARKS: Attachment 17 contains comments from Committee Members. Attachment 18 contains public comment received after the completion of the Staff Report. ATTACHMENTS: Attachments previously received with the November 5, 2020 Staff Report: 1. June 11, 2020 Community Workshop and Online Survey Summary 2. Initial Draft of Land Use Element 3. Initial Draft of Community Design Element 4. Public Comment received by 11:00 a.m., Friday, October 30, 2020 Attachments previously received with November 5, 2020 Addendum: 5. Committee Member Comments 6. Public Comments received between 11:01 a.m., Friday, October 30, 2020 and 11:00 a.m., Wednesday, November 4, 2020 Attachment previously received with the November 5, 2020 Desk Item: 7. Committee Member Comments Attachments previously received with the November 19, 2020 Staff Report: 8. November 17, 2020 Town Council Staff Report with Attachments 1-7 9. Committee Member Comments PAGE 2 OF 2 SUBJECT: Revised Initial Drafts of the Land Use and Community Design Elements January 6, 2021 N:\DEV\GPAC\GPAC Staff Reports\2021\01-07-21\Item 4 - Addendum with Attachments.docx Attachments previously received with the November 19, 2020 Desk Item Report: 10. Committee Member Comments 11. Public Comment Attachments previously received with the January 7, 2021 Staff Report: 12. Revised Initial Draft of Land Use Element 13. Comment Response Summary Table – Land Use 14. Revised Initial Draft of Community Design Element 15. Comment Response Summary Table – Community Design 16. Updated Potential Housing Production Table Attachments received with this Addendum Report: 17. Committee Member Comments 18. Public Comment Memo To: General Plan Update Advisory Committee 2040 Fr: Carol Elias Zolla Corrections/Comments to the Land Use Element and Community Design Element Land Use Element Page 3-7, Section 3.2. First Paragraph. First sentence. What does “makes a community a home” mean? How about “makes a Town a cohesive community”? Second and third sentence could be changed to: “The Town is not affordable for many prospective residences, and there are a lack of unit types and sizes to accommodate varied households.” (The word is “prospective” not “perspective”.) Second Paragraph. Third Sentence. How about changing “plan to help achieve” to “must plan for.”? Third Paragraph. In one sentence you say that the “past” had two types of housing. And, then in the next sentence you say the “lessons of the past” had heterogeneous housing types. Change the second sentence. “The Los Gatos planning process has typically focused on two categories of housing: detached… apartments.” Change the third sentence. “... nationwide, needs to strive for communities that are a heterogeneous mix of housing types and price points.” Page 3-9, Section 3.3. Second Paragraph. First sentence. What is “This concept”? (It ’s never named.) Is it “The concept of ‘Neighborhood Connectivity’”? Question: You’re defining the “20-minute” rule to include 20 minutes of bike riding. Is there any area of non-hillside residential that isn’t a 20 minute bike ride from any other part of Town? I’m a slow bike rider, and I can get from Lark Ave. to Main Street in less than 20 minutes, or from Union Ave. to the Monte Sereno border in 20 minutes. What does this concept actually mean from a bike riding perspective? If it’s intended to mean a one-mile distance (approx. a 20 minute walk) why not just say that? (See deleted Section LU-5.5 on Page 3-17) Page 3-11, Land use Designations and Standards. Perhaps instead of “Table 3 -2 divides the 16 land use…” say “Table 3-2 allocates the 16 land use…”. Page 3-11, Table 3-2. “RESIDENTIAL DESIGNATIONS” is spelled incorrectly. Page 3-18, LU-5.12. After the semicolon, you need a space between “are” and “necessary”. Page 3-19, LU-5.13. Why do you use commas to separate these requirements but semicolons in the previous paragraph? Page 3-29. There’s a bullet missing before “Harwood Road District.” ATTACHMENT 17 2 Page 3-32, LU 15.2. I feel like most of these bulleted lists are combined with semicolons, why is this one combined with commas? Page 3-35, LU-16.2. Why is “Landmarks” capitalized? Page 3-36, LU-18.2. Third bullet point should be “Water courses, and” Page 3-36, LU-18.3. This is a very confusing sentence. Perhaps: “To ensure zoning consistency, zoning changes will be made concurrently with a General Plan amendment.” Community Design Element Page 4-33, CD-8.6. I remain opposed to this statement. The Apple store looks fine downtown, and it’s modern. There are other modern buildings on N. Santa Cruz that help the older properties stand out. 3 Memo To: Chairperson Hanssen and Members of the Committee From: Steve Piasecki Date: January 7, 2021 Re: Comments regarding the revised initial Draft of the Land Use Element and the revised initial Draft of the Community Design Element Policy Overview Connectivity is essential to enhancing a sense of community. The Land Use Element (page 3- 9) references connectivity in terms of proximity of services and the Community Character Element (page4-6) reference the importance of connectivity in the form of several policies dealing with building proportions, multi-modal connections etc. I think we need to discuss connectivity in terms of building orientation (face the public street) avoid windows that obscure the inside of the building (so-called Darth Vader buildings) and create visible entries/doors so people know where to enter the building. Also building designers should avoid windowless walls that face public streets. There is a policy that limits blank walls to no more than 50% of the wall expanse. Allowing 50% of a wall expanse to be blank is too much. The ground floor of commercial buildings facing public streets need to be activated. Both elements need stronger policies relating to building orientation, blank walls, visible entries. 1. Land Use Element Page 3-35 General Plan Use and Maintenance: When the GP is adopted I think the Town is going to find minor errors or needed technical updates that do not alter the intent of the goals or policies. I believe the town needs a policy that allows minor technical changes without going through a full general plan amendment. This could be accomplished with a policy that allows the Town Council to review such “corrections” and adopt the altered wording or data with a finding that the alteration does not alter the intent of the affected section or policy. It could be placed in this section or another GP overview section. General Plan Advisory Committee This Page Intentionally Left Blank From: Nick Gera Sent: Monday, January 4, 2021 4:20 PM To: GP2040 <GP2040@losgatosca.gov> Subject: General Plan Update Comment I would like to request that the advisory board consider changing the general plan in the area of 16492-16498 Los Gatos Blvd from Low Density Residential to Neighborhood Commercial. This would better align with the existing zoning in the immediate area. Thank you, Nick Gera ATTACHMENT 18 2 From: Phil Koen Sent: Wednesday, January 6, 2021 9:36 AM To: Laurel Prevett; Mary Badame ; Maria Ristow; Matthew Hudes; Rob Rennie; Marico Sayoc Subject: Comments on Revised Initial Draft of Land Use Element - GPAC meeting January 7, 2021 Dear GPAC Members, Thank you for your time and commitment on assisting the Town in developing a General Plan 2040 update. This is a massive undertaking and without community volunteers such as yourselves, the Town would be unable to complete this task in a thoughtful and inclusive way. So, thank you for your effort to date and the contributions you have made. I have reviewed the latest draft of the Land Use Element and would like to share some thoughts for your consideration. Let me frame my comments by reminding everyone that the Town Council has indicated that the current General Plan is serving the community well, and this update provides the opportunity to REFINE the General Plan by addressing emerging trends, new State laws and to consider other issues that are relevant to the Town. It is important to remember the goal of the update is provide sensible and actionable “mid-course” correction vs. a wholesale change in direction. The current General Plan policies and goals are working, and specifically the current land use element has served the Town well. Having said that, improvements can always be made. Here are my specific concerns: The Land Use Element does not address housing affordability in a meaningful, comprehensive, and objective way and is inconsistent with the fiscal analysis contained in the land use alternatives report. Throughout the Land Use Element there are repeated references to housing affordability and the fact that “finding a place to call home has been unattainable for many”. Specifically, the draft states in section 3.2 “the Town’s housing issues come from many f actors, the primary of which is affordability (high purchase and rental prices)”. And yet the draft does not contain a section that fully discusses a solution to this problem. In the Town Manager’s November 12, 2020 letter to the Town Council, the Town Ma nager states, “while the land use element does not specifically address the affordability of housing, the incorporation of regulations that support Missing Middle housing provides a wider variety of housing TYPES that would be part of meeting the Town’s Regional Housing Needs Allocation (RHNA)”. But the obvious question is, how do we know that the Missing Middle will provide affordable housing and how are we defining affordable housing? In the fiscal analysis methodology section of the Land Use Alternatives report, there is a schedule (see page 46) that shows assessed values by land use. I have attached the schedule for 3 ease of reference. The fiscal analysis for alternative C is built on the critical assumption that the average single-family dwelling will have an assessed valuation of $1.6m with 14 du/ac density. The average multi-family dwelling unit will have an assessed valuation of $1.1m with 26 du/acre. Furthermore, on page 47 of that report (also attached) there is a schedule that shows estimated household incomes for each land use category. For a single-family unit with an assessed valuation of $1.6m, the projected household income is $366,900 and for a multi- family unit with and assessed valuation of $1.1m, the projected household income is $257,500. The lowest projected income for a multi-family unit was $201,100 for a dwelling unit with 36 du per acre density, which is a greater density than the “missing middle” with a 12 du per acre density. How are these dwelling units even remotely affordable, other than for those households with income levels above $200,000? Based on the latest statistics, the median household income for Los Gatos is $140,395 and the median property value is $1.6m. It isn’t apparent to me how the proposed land use element will meaningfully change the affordability issue. Clearly there is a disconnect between the fiscal analysis and the land use element. The land use element makes the broad assumption that the TYPE of housing will somehow make it affordable. It should not be assumed that the “missing middle” (section 3.2) or any other type of housing will be “affordable” lacking a specific affordability definition and goal, backed up by objective evidence that substantiates this claim. This needs to be addressed in the Land Use Element and specifically section 3.2. Section 3.3 – A Plan for Neighborhood Connectivity – the Town of Los Gatos is a fully built-out community and most non-hillside communities can access goods and services within a 20 - minute bike ride. This section has been added and it is not clear as to why it was added. What is the specific problem we are trying to solve? I know that the “15 -minute city” concept is a trendy topic within urban planning circles, but I don’t see how it directly applies to the Town. Do we believe that access to groceries, medical facilities, entertainment, general shopping, schools and parks is not currently withing a 20-minute bike ride (the catchment distance for a 20-minute bike ride is 3 to 4.5 miles) for most non-hillside properties? Has there been a study that has determined that this is really a problem? A circle with a 3 to 4.5 mile radius covers the vast majority of the Town regardless of the center point. Additionally, I am concerned by the statement “the 2040 General Plan will shift FOCUS to re- establishing more complete neighborhood areas that meet the daily needs of residents to be located in a 20-minute walk or bike ride”. What specifically does it mean to “shift focus”? How do you measure “more complete neighborhood areas”? What are the unintended consequences of “shifting focus”? This strikes me as a well-intentioned sentence that has the potential to create confusion and its own set of implementation problems. 4 Furthermore LU 2.1 strikes me as being inconsistent with a built-out community. What does it mean to “promote a mix of compatible uses” for a built -out town? What specific actions are being called for by this policy? If the Town wants to be more prescriptive about promoting walking or biking as alternative transportation methods, which is a core goal of the 15-minute city concept, why not establish an objective in a climate action plan calling for vibrant neighborhoods in which 90% of the non - hillside Town residents can easily walk or bike to meet basic daily non -work needs. We can measure our progress toward this goal, and we don’t have to inject a new policy in the land use element that is poorly defined and not well understood by the majority of the Town’s residents. I would recommend removing this entire section from the Land Use Element and including it in climate action plan. The “15-minute city” critical features of proximity, diversity and density are adequately covered in other sections of the Land Use Element. LU 2.1 does not further inform us in making land use decisions and therefore is not required. LU 5.3 – Neighborhood Characteristics This goal lists neighborhood characteristics that are to be promoted, including affordability. However, as I discussed above, there is no definition of affordabili ty. What isn’t defined cannot be measured or promoted. LU 21.3 – Grant Funding It is not clear to me why the Town would use its limited staff resources to pursue grants that would go to the school districts. Why has this been included in the land use ele ment? Section 3.12 – Healthy Community I doubt there is anyone in the Town that wouldn’t want to improve our community’s health and would encourage the Town to pursue such goals. However, this is an example of where good intentions have over-taken the purpose of the Land Use Element, which is determine what to put where. The Land Use Element should promote thoughtful, equitable and accessible distribution of different land uses and be a tool to improve public health, reduce infrastructure costs and address long-term term environmental issues. Being a tool does not necessarily mean that the Land Use Element should contain prescriptive actions to be taken about community health. Many of the LU’s in this section have nothing to do with land use (healthier diet options, acceptance of government-issued vouchers, healthy food at government sponsored events, vending machine options). These appear to be worthy general policy goals which the Town Council might consider as part of the annual goal setting process. Other LU’s are already regulated by state laws or existing zoning laws, such as restrictions on selling alcohol. As an overall comment I suggest that this entire section be removed from the Land Use Element and placed in some other section of the General Plan, if appropriate. Potential Housing Production Schedule 5 The Housing Production Schedule attached to this draft of the Land Use Element, while in total is not materially different from the Land Use Alternative that was approved by the Town Council (1,964 vs. 1,915), has material differences in the allocation/distribution of new housing units across the nine land use designations (up from six). This new allocation will have an impact on the fiscal analysis and based on my preliminary calculations, will result in a materially different fiscal outcome. To insure internally consistency, a new fiscal analysis should be prepared using the updated production schedule and reasonable assessed valuation assumptions for each of the nine land use categories. I hope these comments will aid you in your discussion and thought process. Thank you Phil Koen Fiscal Analysis Methodology The fiscal analysis of the land use alternatives is based on estimates derived from the Town FY 2019-2020 General Fund budget and the analysis of how different land uses affect Town service cost and tax revenues, as described in the Los Gatos Today Chapter of the General Plan Background Report published in March 2019. This section describes these calculations in more detail. The analysis allocates major revenues such as the property tax, sales tax and transient occupancy tax (TOT) to land uses based on estimated socioeconomic characteristics of the land uses and the legislative tax formulas. Other revenues and most service costs are allocated based on per capita formulas using the existing budget data and population and employment levels in Los Gatos. Each section below describes the major assumptions and data sources used for each revenue and cost category. Property Tax Property tax is based on projected market values for future development shown in the table to the right (Projected Assessed Values by Land Use). The Consultants researched prices for real estate sales transactions over the past two years in Los Gatos. During that time, there were approximately 440 sales transactions for properties in the land use types and density ranges and included in the General Plan alternatives. While property owners pay a total base property tax of one percent of assessed value, the Town receives an estimated 9.3 percent of this revenue. The remaining property tax revenue is distributed to the County and various other taxing agencies, most notably local school districts, in the area. In addition to the base property tax, the Town receives property tax in lieu of vehicle license fees directly from the state. These revenues are based on annual increases in assessed value in each Town and are equal to nearly 21.8 percent of base tax revenues for Los Gatos. Projected Assessed Values by Land Use  Land Use Assessed Value Residential Per Unit Single Family (Density)  (4 du/ac)$2,254,000 (10 du/ac)$2,031,000 (14 du/ac)$1,660,000 (16 du/ac)$1,511,000 Multi-Family (18 du/ac)$1,343,000 (20 du/ac)$1,048,000 (26 du/ac)$1,165,000 (36 du/ac)$910,000 BMP Units Low Income $385,000 Moderate Income $510,000 Non-Residential Per Sq. Ft. Commercial $1,086 Industrial $200 Office $556 Institutional $189 Source: ADE,2019, based on property transaction data for 2017-2019 reported by CoreLogic ListSource. Town of Los Gatos General Plan 2040 | Land Use Alternatives Report 46 Sales Tax The Town receives 1.125 percent of taxable sales that occur within the Town limits. In the Background Report, the Consultants estimated that approximately 25 percent of total retail demand leaves Los Gatos as households and businesses shop at other retail centers in the regional market area. Based on the projected home prices and rent levels for the housing units in the land use alternatives, the Consultants estimated household income levels and calculated the amount of taxable retail sales from each income segment shown in the table below (Estimated Household Incomes and Sales Tax Generation Rates). Estimated Household Incomes and Sales Tax Generation Rates Residential Land Use Categories Sales Price Homeowners Renters Spent in Los Gatos Sales Tax per HouseholdHousehold Income Retail Sales % of Income Taxable Sales Renter Household Income Retail Sales Taxable Sales Single Family (4 du/ac)$2,254,000 $498,200 21.0%65.7%75.0%$580 (10 du/ac)$2,031,000 $448,900 21.0%65.7%75.0%$523 (14 du/ac)$1,660,000 $366,900 21.0%65.7%75.0%$427 (16 du/ac)$1,511,000 $334,000 21.0%65.7%75.0%$389 Multi-Family (18 du/ac)$1,343,000 $296,800 21.0%65.7%$88,209 34.0%85.0%75.0%$241 (20 du/ac)$1,048,000 $231,600 21.0%65.7%$88,209 34.0%85.0%75.0%$226 (26 du/ac)$1,165,000 $257,500 21.0%65.7%$88,209 34.0%84.0%75.0%$230 (36 du/ac)$910,000 $201,100 21.0%65.7%$88,209 34.0%84.0%75.0%$217 BMP Low $385,000 $85,050 29.8%69.5%$85,050 34.7%84.0%75.0%$197 BMP Moderate $510,000 $112,700 28.8%69.1%$112,700 34.7%84.0%75.0%$260 Source: ADE, 2019. Homeowner incomes based on qualifying income for 30 year mortgage at 3.9% with 10% down payment and housing costs, including taxes and insurance, at 33% of income. Rents assumed to average $2,575 per month. The sales tax per household assumes 80% renters and 20% homeowners for the multi-family units. For non-residential projects in the land use alternatives, the sales tax generation rates are based on the analysis of existing sales tax in the Background Report. In the fiscal calculations, the sales tax attributed to retail/commercial excludes sales tax generated by Los Gatos households. This was done to avoid double counting household revenues. The remaining taxable sales from retail/ commercial are generated by non-Los Gatos households, visitor spending, and business to business transactions. Office, industrial, and institutional taxable sales are point of sale transactions at those places of business. December 2019 47 This Page Intentionally Left Blank