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09 Addendum B.Item # 9 - Housing Element PREPARED BY: Erin Walters, Associate Planner and Jocelyn Shoopman, Associate Planner Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and the Community Development Director 110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6872 www.losgatosca.gov TOWN OF LOS GATOS COUNCIL AGENDA REPORT MEETING DATE: 03/05/2024 ITEM NO: 9 ADDENDUM B DATE: March 4, 2024 TO: Mayor and Town Council FROM: Laurel Prevetti, Town Manager SUBJECT: Discuss and Provide Direction on the Proposed Revisions to the Draft Revised 2023-2031 Housing Element and Next Steps. Location: Town-Wide. General Plan Amendment Application GP-22-003. REMARKS: On March 1, 2024, Town staff and the Town’s Housing Element consultant met with the Town’s Department of Housing and Community Development (HCD) reviewer for a live editing meeting where staff was able to share the Town’s draft approach in addressing the HCD preliminary review matrix comments received on February 20, 2024. The HCD reviewer’s supervisor (HCD Senior Program Manager Paul McDougall) had tentatively accepted the meeting date, but was unable to attend the meeting. During this meeting staff went through the February 20, 2024, HCD preliminary review matrix, discussing each row where HCD had comments remaining, as noted in the column titled “HCD Feedback Summary,” and included as Attachment 19 to the March 5, 2024 staff report. Staff received feedback from the HCD reviewer that the modifications seemed to address the remaining comments, with the exception of Programs J and AY. Town staff provided justification for the proposed language in Programs J and AY, including: • The number of parcels still available for small multi-unit housing; • Background on the Town’s Historic Resources; • The Town’s challenges related to its geographic hillside setting, Very High Fire Hazard Severity Zone, and evacuation routes for fire and flood hazards; • The transit proximity criteria; and • Comparisons with similar Bay Area municipalities with certified Housing Elements. PAGE 2 OF 3 SUBJECT: DRAFT REVISED 2023-2031 HOUSING ELEMENT/GP-22-003 DATE: March 4, 2024 REMARKS (continued): When specifically discussing the Very High Fire Hazard Severity Zone, the HCD reviewer provided feedback that excluding this portion of the Town is inconsistent with California Building Code standards that are in place for fire mitigation measures pertaining to residential development. The HCD reviewer requested that staff provide the additional map analysis on the proposed language for Programs J and AY. Following the meeting, in the afternoon of March 1, 2024, staff provided the Town’s HCD reviewer with a map which showed the analysis that has been completed to reflect the proposed language in Programs J and AY (Attachment 23). Based on the analysis, there are approximately 3,000 parcels available in the low and medium density designations to support the quantified objectives of Programs J and AY for small multi- unit housing. The Town’s HCD reviewer indicated that this analysis would be shared with HCD Senior Program Manager Paul McDougall for discussion and that feedback would be tentatively provided to the Town on March 4, 2024, to be shared with the Town Council via a Desk Item report on March 5, 2024. In response to a request, Attachment 23 contains correspondence from the Town’s Housing Element consultant to HCD on February 1, 2024, requesting informal feedback from HCD on the proposed edits to the Draft Revised Housing Element, specifically regarding the proposed language for Programs J and AY. Additional notations have been added to this document to clarify the timing and source of the different levels of edits to the program language. ATTACHMENTS: Previously Received with the January 16, 2024 Staff Report: 1. Draft Revised Housing Element, Track Changes Copy 2. Draft Response Table 3. December 1, 2023 HCD’s Findings Comment Letter 4. Public Comments Received Between 11:01 a.m., Tuesday, December 19, 2023, and 11:00 a.m., Thursday, January 11, 2024 Previously Received with the January 16, 2024 Desk Item: 5. Comments from the Vice Mayor 6. Public Comments Received Between 11:01 a.m., Thursday, January 11, 2024, and 11:00 a.m., Tuesday, January 16, 2024 Previously Received with the February 6, 2024 Staff Report: 7. Draft Revised Housing Element, Track Changes – January 2024 8. Draft Response Table – January 2024 9. HCD Informal Preliminary Review Matrix with Staff’s Responses PAGE 3 OF 3 SUBJECT: DRAFT REVISED 2023-2031 HOUSING ELEMENT/GP-22-003 DATE: March 4, 2024 ATTACHMENTS (continued): 10. Goldfarb & Lipman, LLP Feedback Table with Staff’s Responses 11. Track Changes and Clean Version of Program AY Housing Mobility 12. Public Comments Received Between 11:01 a.m., Tuesday, January 16, 2024, and 11:00 a.m., Thursday, February 1, 2024 Previously Received with the February 5, 2024 Addendum: 13. Pages from the Draft Revised Housing Element Without the Recommendations Made by the Housing Element Advisory Board 14. Correspondence with HCD Previously Received with the February 20, 2024 Staff Report: 15. Extracted Pages from the Draft Revised Housing Element with Revision Previously Received with the February 20, 2024 Desk Item: 16. Correspondence with HCD 17. HCD Second Informal Preliminary Review Matrix 18. Public Comment Received Between 11:01 a.m., Thursday, February 15, 2024, and 11:00 a.m., Tuesday, February 20, 2024 Attachments Received with the February 29, 2024 Staff Report: 19. HCD Second Informal Preliminary Review Matrix with Staff’s Responses 20. Extracted Pages from the Draft Revised Housing Element with Revisions 21. Correspondence with HCD Attachment Received with the March 1, 2024 Addendum: 22. Communications from the Vice Mayor Attachments Received with this Addendum B: 23. Map Analysis of Programs J and AY 24. Annotated Housing Element Consultant Communications Regarding Programs J and AY Shared with HCD on February 1, 2024 This Page Intentionally Left Blank L O M A A L T A AV WIM B L E D O N D R KENNE D Y R D HER N A N D E Z A VRIDGECRESTAV OLDBLOSSOMHILL RD SAN BENITO AVCAMELLIATEALMOND BLOSSOM LN BAYVIEWAVAND R E W S S T CHERRY BLOSSOM LN SHANNON R D CAMINO DELCERROBA C H M A N A V TAFT DRCARLTONAV LESTER LNARROYOGRANDE WY ANNE WY BICKNE LLRDMONT CLAIRRD ESCOBA R AV W ES TCHES TER D R LONGWOODDRMORE AVHAR D I N G A V VISTA DELMONTEALBERT OWYKENTFIELD DRSHORT RDTAIT AVGARDENHILLDRSPRECK L E S A V DAVES A V GATE W A Y D ROKARDUNIVERSITY AVSTON Y B R O O K R D GLEN RIDGE AV MARIP O S A A V FARLEY R D WQUITORD HI CKSRD AZTEC RIDGE DR CYPRESSWYCOLLEGEAV SUVIEWDR PROSPECT AV SHANNONRD PHILLIPS AVCROSS W Y MAYAWY OVERLOOK RD MI R E V A L R D TOPOF THEHI LL RD BLACKBERRY HILLRD FORRESTERRD PENNSYLVANIAAV HAPPY ACRES RDLONGM EADOW D R KEN NEDYRD JO H N S O N A V FOSTERRDSKYLN TOURNEY LOOP SUN D A V SKENNED Y RD RAVINIA WY SANTAROSA D R SPRING STSI ERRA AZ ULE TWIN OAKSDRTOURNEY RDWOODED VI EWDRRESERVOIR RDTERESITAWY1717785 CA M D E N A V SANTOMASEX WMAINST UNIVERSITY AV E M AIN S TN SANTA CRUZ AVLOSGATOSBLSSANTACRUZ AVLEXINGTONRESERVOIRPAR K R D CURTNER AV LEIGH AVLOS GATOS BLWINCHESTER BL LOS GATOS-ALMADEN RD BLOSSOMHILLRD N SANTA CRUZAVBEAR C REEK R D LAR K A V SA RA T O G A -L O S G A T O S RD B LOSSOMHILL R D UNIONAVFOXWORTHY AV KOOSE R R DMERID IAN AV SAMARITAN DRSBASCOM AVHARWOOD RDCAMDEN AV WESTMONT A V HARRIET AVHILLSDALE A VCAMDENAVQUITO RDLOS G ATOS-SARATOGARD S WINCHESTER BLCAMDENA V BRANHAM LN COLE M A N R D Parcels Selection Zoning District R-1:10 R-1:12 R-1:12:PD R-1:20 R-1:20:PD R-1:8 R-1:8:PD R-M:12-20:PD R-M:5-12 R-M:5-12:PD RD Town of Los Gatos Town of Los Gatos Parcel Criteria ¯0 10.5 Miles ATTACHMENT 23 This Page Intentionally Left Blank From: Veronica Tam Sent: Thursday, February 1, 2024 10:49 AM To: Jauregui, Jose @HCD <Jose.Jauregui@hcd.ca.gov>; Gabrielle Whelan <GWhelan@losgatosca.gov>; McDougall, Paul@HCD <Paul.McDougall@hcd.ca.gov> Cc: Joel Paulson <jpaulson@losgatosca.gov>; Jennifer Armer <JArmer@losgatosca.gov>; Jamie Power ; Erin Walters <EWalters@losgatosca.gov>; Jocelyn Shoopman <jshoopman@losgatosca.gov>; Nazanin Salehi Subject: RE: Los Gatos - Revised HE ŜņřŕņœŏłōġŔņŏŅņœŞġ Hi Paul and Jose – Just a correcƟon that we are not going for readopƟon yet. We would like to get the HE to a cerƟfiable status first. Thanks, Veronica Veronica Tam, AICP Principal Veronica Tam and Associates, Inc. From: Veronica Tam Sent: Thursday, February 1, 2024 10:30 AM To: 'Jauregui, Jose @HCD' <Jose.Jauregui@hcd.ca.gov>; Gabrielle Whelan <GWhelan@losgatosca.gov>; McDougall, Paul@HCD <Paul.McDougall@hcd.ca.gov> Cc: Joel Paulson <jpaulson@losgatosca.gov>; Jennifer Armer <JArmer@losgatosca.gov>; Jamie Power ; Erin Walters <EWalters@losgatosca.gov>; Jocelyn Shoopman <jshoopman@losgatosca.gov>; Nazanin Salehi Subject: Los Gatos - Revised HE Hi Joe and Paul – AƩached (and below) are the revised pages for Los Gatos Housing Element based on our most recent discussions. The Town is going to Planning Commission and Town Council for readopƟon. We are hoping that you can take a look at these changes before we move to readopt. Please note the GREEN highlights are new changes. Revised Pages Only hƩps://www.dropbox.com/scl/fi/1s5nf8il7zmxk7nd4bhwt/DraŌ-Revised-Housing-Element-Revised- Pages-Only.pdf?rlkey=aiiu0b9s09qłaxry77ijdulj&dl=0 Full HE with Tracked Changes dd,DEdϮ4 hƩps://www.dropbox.com/scl/fi/m1a675bsloxifr09bxolk/DraŌ-Revised-Housing-Element-Track- Changes.pdf?rlkey=okew0qyjququhbi94f7a81d2v&dl=0 Veronica Tam, AICP Principal Veronica Tam and Associates, Inc. HCD Revised Draft Revised 2023-2031 Housing Element 10-46 HCD Revised Draft Revised 2023-2031 Housing Element March SeptemberNovemberJanuary 20232024 Programs Performance Metric(s) Delivery of Housing Element IJ Helping Senior Housing s PrograResourcesm Provide financial assistance for health, safety, emergency and accessibility home repairs to low-income seniors and low- income mobile homeowners through the Below Market Price Program funds, subject to availability of Program funds. Provide regularly updated senior housing resource materials at the Adult Recreation Center, Library, and Farmers’ Market. Implementation Policies HE-1.6 Universal Design HE-2.7 Senior Housing HE-2.8 Equal Housing and Special Needs HE-6.1 Fair Housing HE-6.2 Financial Assistance HE-6.3 Housing for Persons with Special Needs HE-6.4 Affordable Housing Awareness Responsible Department/Review Authority Responsible Department/Review Authority Community Development Department and the Town Council Timeframe Ongoing and annual effort Update materials annually Funding Source Town Affordable Housing Funds Quantified Objective Maintain the existing housing stock by funding three home repairs to lower income seniors annually Performance Metric(s) Measure the number of units assisted versus the need JK Small Multi-Unit Housing, “Missing Middle” The Housing Element supports the land use goal of providing opportunities for housing that can accommodate the needs, preferences, and financial capabilities of current and future residents in terms of different housing types, tenures, density, sizes, and costs. Specifically, the Town aims to create mixed residential neighborhoods through new and innovative housing types that meet the changing needs of Los Gatos households and expand housing in a variety of neighborhoodsall neighborhoods. These housing types include, but are not limited to, single dwelling units, multifamily dwelling units, accessory dwelling units, small and micro units, use of pre-fabricated homes, and clustered housing/cottage housing. The Implementation Policies HE-1.5 Variety of Housing Choices HE-2.4 Rental Housing HE-3.3 Efficient Development Processing Responsible Department/Review Authority Community Development Department Timeframe December 2024 Funding Source None required Quantified Objective Increase the number of small multi-unit housinglow- rise multi-family developments by five50150 units from the previous yearover eight years with the goal of achieving 100% of the units in low to medium density designations and high median income areas. v ůƵĞŚŝŐŚůŝŐŚƚŝŶŐĚĞŶŽƚĞƐƌĞǀŝƐŝŽŶƐ ƌĞǀŝĞǁĞĚďLJdŽǁŶŽƵŶĐŝůĂƚƚŚĞ :ĂŶƵĂƌLJϭϲ͕ϮϬϮϰdŽǁŶŽƵŶĐŝů ŵĞĞƚŝŶŐ͘ v 'ƌĞĞŶŚŝŐŚůŝŐŚƚŝŶŐĚĞŶŽƚĞƐ ƌĞǀŝƐŝŽŶƐƌĞǀŝĞǁĞĚďLJƚŚĞdŽǁŶ ŽƵŶĐŝůĂƚƚŚĞ&ĞďƌƵĂƌLJϲ͕ϮϬϮϰ dŽǁŶŽƵŶĐŝůŵĞĞƚŝŶŐ͘ Edit made in a green highlight in response to Town Council direction provided on January 16, 2024. Edit made in a green highlight as a recommendation from the HEAB at the January 18, 2024 meeting in response to a comment from HCD in the preliminary informal matrix received by the Town on January 18, 2024. Edit made by staff in a green highlight in response to a comment from HCD in the preliminary informal matrix received by the Town on January 18, 2024. Βlue Green 10.Housing Element JanuaryNovemberSeptember March 2023 2024 HCD Draft Revised Draft 2023-2031 Housing Element 10-47 Programs Town will also promote small multi-unit housing that increases density while remaining consistent with the building scale and character present in existing neighborhoods. This includes multi-family units or clustered residential buildings that provide relatively smaller, less expensive units within existing neighborhoods. Update the Zoning Code to facilitate low rise multi-family structuressmall multi-unit housing in the low to mMedium Residential Density designations. TheGeneral Plan defines sSmall multi-unit housing is defined as multiple units on a single parcel (whether attached or detached) that are compatible in scale and form with detached single-family homes. Common housing types include duplexes; triplexes; fourplexes; courtyard apartments; cottage courts; townhomes; triplex stacked (vertical); and live-work spaces. Promote this program through publication, to include the following information: Low rise multi-family dwelling units ranging from two to 10 units can help meet the needs of families, seniors and students. Permit processing times tend to be shorter than larger multi-family buildings due to the low-rise nature of the structures. Specifically, update the Zoning to allow for all housing types considered for the provision of Small Multi-Unit Housing types as part of Low Density High Density Residential designations. Research existing regulatory impediments to the creation of new housing types that have the potential to fulfill unmet housing needs (e.g., tiny homes, co-housing developments) and if necessary, amend applicable ordinances and development standards to facilitate and to allow for their development at the maximum density. Pursue establishment of a maximum average unit size as a tool to moderate unit sizes for developments over a certain size but to allow flexibility for a range of unit sizes. Performance Metric(s) Complete Zoning Code amendment by December 2024 and track the number of entitled Planning applications received per year Edit made by staff in a green highlight in response to a suggested edit provided by the Town's outside legal counsel, Goldfarb & Lipman, LLP, provided as Attachment 10 to the February 6, 2024, Town Council meeting. Edit made by staff in a green highlight in response to a suggested edit provided by the Town's outside legal counsel, Goldfarb & Lipman, LLP,provided as Attachment 10 to the February 6, 2024, Town Council meeting. HCD Revised Draft Revised 2023-2031 Housing Element 10-76 HCD Revised Draft Revised 2023-2031 Housing Element March SeptemberNovemberJanuary 20232024 Programs BMAW Story Poles and Netting Policy Update the Review Story Pole and Netting Policy and explore create alternative options for residential or mixed-use projects with affordable housing to reduce the associated costs of installing story poles, by providing an option to provide visuals, video rendering, or other visual methods in place of story poles for all multi-family and mixed-use projects, and all projects over 55 feet in height to reduce constrains/cost and increase approval certainty. Modifications already approved by Town Council on August 1, 2023, include: use of flag rope instead of netting; reduce story pole requirements for multi-building projects to just represent perimeter of site and tallest buildings; and removal of story pole requirement for projects with 30 percent Below Market Price housing or 20 percent Low Income or Very Low Income housing. Additional modifications to further reduce impacts of story pole policy are scheduled for review by Town Council on December 5, 2023.currently under consideration include, but are not limited to: use of one or two rows of flag rope in place of netting; use of renderings and digit simulations; use of signage; and reduction in the number of story poles Implementation Policy HE-3.1 Regulatory Incentives for Affordable Housing Responsible Department/Review Authority Community Development Department Timeframe Implement by December March 20243, and evaluate effectiveness of reduced requirements every year beginning in 2025; and identify additional incentives and/or site capacity, if needed, within six months of need identification. Funding Source General fund (staff time) Quantified Objective Reduce cost of development by modifying the story pole requirements for affordable housing projects. Performance Metric(s) Measure impact of modifying the story pole policy on the number of affordable housing units entitled AX Local Labor Program List Establish and post a list of local labor unions and apprenticeship programs on the website to encourage the developers and contractors to hire local labor. Implementation Policy HE-1.4 Housing Design Responsible Department/Review Authority Community Development Department Timeframe Establish a list by December 31, 2024, to post online. Funding Source General fund (staff time) Quantified Objective Annually update the list or upon request from a local union. Performance Metric(s) N/A AY Housing Mobility Implementation Edits made in a green highlight in response to Town Council direction provided on January 16, 2024. 10.Housing Element JanuaryNovemberSeptember March 2023 2024 HCD Draft Revised Draft 2023-2031 Housing Element 10-77 Programs Housing mobility strategies consist of removing barriers to housing in areas of opportunity and strategically enhancing access (Los Gatos is entirely highest resource in terms of access to opportunity and a concentrated area of affluence). To improve housing mobility and promote more housing choices and affordability townwide, including in lower density neighborhoods, the Town will employ a suite of actions to expand housing opportunities affordable to extremely low, very low-, low-, and moderate-income households. Actions and strategies include: ƒSB 9 – Monitor the Town’s SB 9 standards and amend standards to facilitate SB 9 applications (e.g., duplexes in single-family zones) if the Town is not on track to meet its SB 9 application goals during the planning period. See Program AV. ƒRezoning for Small Multi-Unit Housing, “Missing Middle” – Modify the Zoning Code to facilitate small multi-unit housing in the low to medium density designations. This includes creating mixed residential neighborhoods through new and innovative housing types that meet the changing needs of Los Gatos households and expand housing choices in a variety of neighborhoods. Housing types include, but are not limited to single dwelling units, multifamily dwelling units, accessory dwelling units, small and micro units, use of prefabricated homes, and clustered/cottage housing. See Program J. ƒHousing on Town Sites – Enter into a public-private partnership to develop housing, targeting low-income households, on Town owned properties. See Program E. ƒEnhanced Inclusionary Housing – Assess and amend the Town’s inclusionary housing requirements to better produce low-income units and units for special needs groups townwide. See Program L. ƒAccessory Dwelling Units (ADUs) – Encourage and streamline ADUs in Policy HE-1.5 Variety of Housing Choices Policy HE-1.7 Infill Opportunities in Single-Family Neighborhoods Responsible Department/Review Authority Community Development Department Timeframe Annually review overall progress and effectiveness in April and include information in annual report to HCD. If the Town is not on track to meet its 160 affordable housing unit goal for the 8-year RHNA cycle by 2027 (i.e., 80 affordable units built or in process by 2027), the Town will consider alternative land use strategies and make necessary amendments to zoning or other land use documents to facilitate a variety of housing choices, including but not limited to, strategies that encourage missing middle zoning (small-scale multi-unit projects), adaptive reuse, and allowing additional ADUs and/or JADUs, within six months, if sufficient progress toward this quantified objective is not being met. Funding Source General fund (staff time) Quantified Objective Provide 160 housing opportunities affordable to lower income households by January 2031. Performance Metric(s) Townwide, but especially lower-density neighborhoods. Edits made in a green highlight in response to Town Council direction provided on January 16, 2024. HCD Revised Draft Revised 2023-2031 Housing Element 10-78 HCD Revised Draft Revised 2023-2031 Housing Element March SeptemberNovemberJanuary 20232024 Programs single-family neighborhoods by preparing standardized ADU plans with a variety of unit sizes and by affirmatively marketing and outreach to increase awareness and the diversity of individuals residing in Los Gatos. See Program Q. ƒ Junior ADUs – Develop and adopt objective standards to allow more than one (at minimum two) Junior ADU per structure by July 2025. The objective is to achieve at least 10 JADUs in lower-density neighborhoods by January 2031. See Program Q. ƒ Religious Institutional Sites – Expand housing opportunities on all religious institutional sites within the Town. See Program S. Conduct outreach to owners and operators of religious institutions to raise awareness and encourage housing proposals. Increase affordable housing on religious institution/faith-based site(s) during the 2023-2031 planning period by 25 units. If no application for housing on a religious institution/faith- based site is received by December 2025, the Town will expand outreach efforts to be conducted annually. This may include direct mailings to faith-based sites highlighting successful affordable housing units on other faith-based sites, as well as available Town resources and programs to support such projects (e.g., Programs N, P, T, AI, AJ – Assist in securing funding for affordable housing projects). ƒ Homesharing – Research and pursue a homesharing program, including coordination with non-profits and other to assist with matching tenants with existing homeowners. The Town will publicize and take other actions as necessary (e.g., facilitate presentations at the Los Gatos Adult Recreation Center, etc.) at least annually with the goal of five opportunities per year. See Program T. Edits made in a green highlight in response to Town Council direction provided on January 16, 2024.