Item 27 Desk Item Staff Report Zoning Code Amendment A-03-2n
MEETING DATE: 6/16/03
ITEM NO.
DESK ITEM f
COUNCIL AGENDA REPORT
DATE: June 16, 2003
TO: MAYOR AND TOWN COUNCIL
FROM: DEBRA J. FIGONE, TOWN MANAGER
SUBJECT: ZONING CODE AMENDMENT A-03-2
CONSIDER AMENDING THE TOWN CODE TO UPDATE THE SECOND
DWELLING UNIT ORDINANCE. IT HAS BEEN DETERMINED THAT
THIS PROJECT COULD NOT HAVE A SIGNIFICANT IMPACT ON THE
ENVIRONMENT THEREFORE, THE PROJECT IS NOT SUBJECT TO THE
CALIFORNIA ENVIRONMENTAL QUALITY ACT. (SECTION 15061
(B)(3)).APPLICANT: TOWN OF LOS GATOS
DISCUSSION:
1) Following are clarifications to attachments in the Council Report:
a) Recommendation # 6 section of the report should refer to Attachment 1, rather than
Attachment 2.
b) Assembly Bill 1866 is included as Exhibit D of Attachment 2.
2) If the Council concurs with the recommendation to restrict the price of new Second units at
50% of the Fair Market Rents, they would be rented at the following levels:
# of Bedrooms
1
2
3
4
$713.00
S880.00
$1207.00
$1355.00
3) Attachments 4 and 5 were received this evening. Staff is researching the issues raised in the
attached letters, but is inclined to recommend that Council introduce the Ordinance this
evening. Staff will determine if the issues raised have merit and are compelling. If necessary,
PREPARED BY: . OR
DIRECTOR OF COMMUNITY DEVELOPMENT
Reviewed by: 965 Assistant Town Manager ,014=Attorney Clerk Finance
Community Development Revised: 6/16/03 5:18 pm
Reformatted: 5/23/02
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: ZONING CODE AMENDMENT A-03-2
June 16, 2003
staff will place a revised ordinance on the August 4, 2003 agenda for introduction since
deletion of substantive provisions of an ordinance requires a new public hearing.
Attachments:
1.- 3. Previously submitted
4. Letter from Tri County Apartment Association (two pages), received June 16,
2003.
5. Letter from Silicon Valley Association of Realtors, (two pages), receive June
16, 2003.
DISCUSSION:
BNL:JC
N:1DEV\.Jennifer\TC\June 16 TC2nd unitdeskitem.wpd
06/16/2003 03:46 4089470819
TCAA
PAGE 02
■
Tri-County
Apartment
Association
A Chapter of the California Aparrment Assoclstior$
June 16, 2003
Mayor Sandy Decker
120 E. Main St.
P.O. Box 949
Los Gatos, CA 95031
RECEIVED
JUN 1 6 2003
MAYOR & TOWN COUNCIL
Re: Agenda Item 27, Second Unit Ordinance
Dear Mayor Decker and Councilmembers:
Tri-County Apartment Association (TCAA) TCAA is extremely supportive of the Town's
efforts to update their the Second Unit Ordinance by complying with state bill AB 1866 in
order to produce more affordable housing, We feel that increasing the number of
second units can have a positive impact on the Town of Los Gatos, both for renters and
homeowners. However, we have some concerns regarding the inclusion of rent control
as one of the amendments to the Second Unit Ordinance.
By way of reference, TCAA is the non-profit trade association serving the rental housing
industry in Santa Clara, San Mateo, and Santa Cruz Counties. Our members own,
manage and develop multi -family housing.
We are proud to join others in the community in advocating for the construction of more
affordable housing. TCAA contributed $50,000 to the Santa Clara County Housing
Trust. Our members also contributed several hundreds of thousands of dollars to the
Housing Trust. TCAA representatives have testified at city council meetings throughout
the Bay area in support of affordable housing projects.
We are concerned that imposing a rent control cap, as outlined in section 29,10,320
Section (a), would be a huge disincentive to construct any second units in Los Gatos.
Rent control would encourage owners to charge the maximum allowable rent instead of
the lower market rents of today, thus artificially inflating rents.
Additionally, this policy could be illegal under the State Costa -Hawkins Rental Housing
Act, which bars rent control for single family residential units (R-1). A case involving a
similar ordinance in the City of Santa Cruz is on appeal with the State Supreme Court
and very likely to be overturned. (Travis et al. v. City of Santa Cruz et al. 100 Cal. App.
Ott' 609 (2002)
Further, we feel that putting restrictions and burdensome reporting requirements on
owners of such units is also a disincentive to build or seek amnesty for second units.
Requiring owners to rent to tenants at only a below market rate is a disincentive to build
and rent second units, as is the purpose of AB 1866, the production of secondary units.
Serving the rental huusinr indu.ctrf. in San Mateo, Santa Clara cF Santa Cruz caunne6
792 Meridian Way, Suite A San Jose, CA 95126-3899 fax (408) 947-0819 telephone (408) 2917-0483
Attachment 4
06/16/2003 03:46 4089470819
TCAA
PAGE 03
Lastly, the Planning Commission's recommendation to limit the rent
owner to rent to whomever they choose is contradictory and should
completely.
TCAA applauds the Town of Los Gatos for their forward thinking on
believes the intent of this ordinance is to produce more units, which
with onerous rent control restrictions.
We look forward to a positive dialogue with the Town on this issue.
Sincerely,
gm
Jeffrey M. Dennison
Govemment Relations Manager
levels but allow the
be stricken
this issue. TCAA
would not be done
2
1
LRud Lortz; Letter re. 2nd Unit Rent Control, June 2003.doc
Page 1
SILICON VALLEY
ASSOCJATJON OF REALTORS
345 S. San Antonio Road
Los Altos, CA 94022
650-949-9115, 650-948-6716 fax
June 16, 2003
Hon. Sandy Decker
Mayor, Town of Los Gatos
110 East Main Street
Los Gatos, CA 95031
Re: Agenda Item 27, Second Unit Ordinance
Dear Mayor Decker:
11)
On behalf of the Silicon Valley Association of REALTORS® (SILVAR), I would like to
commend the Town of Los Gatos for their efforts to liberalize the requirements for
existing and planned secondary units in order to comply with State Law AB 1866 and
increase the affordable housing stock within the community.
However, we believe Section 29.10.320, which establishes deed restrictions and rent
control, to be counterproductive to the goal of providing more secondary units and ask
that it be stricken from the proposed ordinance. In fact, these restrictions may serve as a
disincentive to the creation of more secondary units.
We are concerned that the establishment of rent control on secondary units may be illegal
under the State Costa -Hawkins Rental Housing Act, which bans rent control on single-
family residential units (R1) and new construction. A case involving a similar ordinance
in the City of Santa Cruz is on appeal with the State Supreme Court and very likely to be
overturned. (Travis et al. v. City of Santa Cruz et al. 100 Cal. App. 41' 609 (2002)
Under the Town's existing Below Market Price program, between 10 and 20 percent of
all new development is required to be offered at BMP rates. If the proposed amendment
is adopted, 100 percent of secondary units would be required to rented at BMP rates.
Further, while other developments can offset the cost of providing the BMP housing by
charging a higher market rate, the entire burden of providing BMP secondary units would
be assumed by an individual homeowner with no mechanism to offset the cost. Finally, it
Attachment 5
pud Lortz - Letter re. 2nd Unit Rent Control, June 2003.doc
Page 2
is unclear how long the Town would deed restrict the secondary units and how the Town
would enforce the rent control requirements.
Again, SILVAR applauds the Town for its effort to promote affordable secondary units in
Los Gatos. We look forward to working with the Town Council and staff to find
alternatives to rent control to achieve this laudable goal.
I look forward to working with you on this issue.
Sincerely,
Natalie Cardenas
Government Affairs Director
cc: Los Gatos Town Council
Bud Lortz, Director of Community Development
Town Council Minutes June 16, 2003
Redevelopment Agency Los Gatos, California
PUBLIC HEARINGS CONTINUED
TREE PROTECTION ORDINANCE/CONT. (26.35)
Council Comments: A better understanding of the biological and environmental impacts ofnon-native
vegetation in our hillsides will be studied by staff for consideration for later amendments to this
ordinance; Penalty for the same person committing the same offence will be assessed further; Definition
of significant impacts will be considered for future amendments.
Council Consensus:
After discussion the following amendments were made to the Proposed Ordinance:
Page 1 of 13: Dangerous
The words "as determined by a certified arborist or the deciding body." will be added to the end
of the sentence.
Page 2 of 13: Diameter
The word "(circumference)" will be deleted.
Page 4 of 13: Exceptions #2
The words "when part of an orchard" will be deleted.
Page 6 of 13: Standards of Review #1
The words "based on a report from a certified arborist." will be added after the words "....proximity
to existing or proposed structures."
Motion by Mr. Pirzynski, seconded by Mrs. Decker, that Council introduce the Proposed Ordinance
to effectuate the Zoning Code Amendment, entitled ORDINANCE OF THE TOWN OF LOS
GATOS AMENDING THE ZONING ORDINANCE OF THE TOWN CODE, CHAPTER 29,
DIVISION 2, SECTION 29.10.0985 THROUGH 29.10.0985, TO REVISE THE TREE
PROTECTION ORDINANCE, with the amendments noted above. Carried unanimously.
SECOND DWELLING UNIT ORDINANCE/PUBLIC HEARING (27.32)
Mayor Decker stated that this was the time and place duly noted for public hearing to consider
amending the Town Code to update the Second Dwelling Unit Ordinance. It has been determined that
this project could not have a significant impact on the environment, therefore, the project is not subject
to the California Environmental Quality Act (Section 15061 (b)(3)). Zoning Code Amendment A-03-2.
Applicant: Town of Los Gatos.
The following people from the audience addressed this issue:
Jeff Dennison, Government Relations Manager of the Tri-County Apartment Association, spoke about
the goal of the new state legislation being affordable housing production to meet the needs of the
consumer. He also spoke to the possibility that rent control language may have been used in the
proposed ordinance, and that "the Town is opening itself up to significant, costly and long litigation
should it adopt a Second Unit Ordinance in the form under discussion.
Natalie Cardenas, Government Affairs Director for Silicon Valley Association of Realtors, spoke to
the wording of the ordinance insisting that the rental units be below market value, and she suggested
that these units not be so restrictive. She asked that more square footage be allowed. Local control is
N:\Clk\Marian's Files 'Ora ft Minutes \.MMO61603
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Town Council Minutes June 16, 2003
Redevelopment Agency Los Gatos, California
PUBLIC HEARINGS CONTINUED
SECOND DWELLING UNIT ORDINANCE/PUBLIC HEARING/CONT.
Speakers continued:
understood by the Association, and she noted that smaller size would be acceptable if the rents were not
controlled. The units would be affordable just by their nature of size and norms of rental, and due to
their size they tend to stay stable.
No one else from the audience addressed this issue.
Mayor Decker closed the public hearing.
Mayor Decker made the required findings that the Zoning Code Amendment is consistent with the
General Plan.
Motion by Mrs. Decker, seconded by Mr. Pirzynski, to waive the reading of the Proposed Ordinance.
Carried unanimously.
The Town Clerk read the Title of the Proposed Ordinance.
Motion by Mrs. Decker, seconded by Mr. Pirzynski, to introduce the Proposed Ordinance entitled,
ORDINANCE OF THE TOWN OF LOS GATOS AMENDING TOWN CODE DIVISION 7,
SECTIONS 29.10.305 THROUGH 29.10.320, SECTION 29.10.3020, AND SECTION
29.20.185(8)a.
Council Comments and Consensus:
1. Any second dwelling units that will be rented shall be made available to eligible applicants
who have a household income at least 20% under Santa Clara County's median income as
defined by the Federal Department of Urban Development.
2. A deed restriction shall be recorded for all new second dwelling units indicating that if the
unit is for rental purposes, it shall comply with the affordability rent level for Santa Clara
County for low income as established by the Federal Department of Urban Development.
3. Owners may rent to family, friend or stranger at their own discretion within the BMP
guidelines or to no one at all, giving the property owner the first right of refusal.
Motion to introduce the Ordinance incorporating Council Comments 1 and 2 above. Carried
by a vote of 4 ayes. Ms McNutt voted no, being supportive of secondary units and affordable
housing, but she does not believe that secondary units should be rent controlled and restricted
to just affordable housing requirements.
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