Staff Reporto x F MEETING DATE: 05105115
ITEM NO. i o
�0s sat s COUNCIL AGENDA REPORT
DATE: APRIL 27, 2015
TO: MAYOR AND TOWN COUNCIL
FROM: LES WHITE, INTERIM TOWN MANAG
SUBJECT: 2015 -2023 HOUSING ELEMENT (GENERAL PLAN AMENDMENT
APPLICATION GP -14 -002) AND ADDENDUM TO THE GENERAL PLAN
FINAL EIR
RECOMMENDATION:
Adopt a resolution adopting the 2015 -2023 Housing Element (General Plan Amendment Application
GP -14 -002) and Addendum to the General Plan Final EIR; and refer the recommendations from the
Housing Element Advisory Board and Planning Commission to the Strategic Goals discussion in
June 2015.
BACKGROUND:
What is the Housing Element?
Under California law, the Housing Element is one of the required elements of the General Plan.
Unlike other elements, the Housing Element is updated on a specific schedule set by legislation.
State law requires that all Bay Area communities adopt an update Housing Element by May 31,
2015. If a community fails to do so, it is required to update its Housing Element every four years
instead of the typical eight year cycle.
After adoption, the California Department of Housing and Community Development (HCD)
determine if each city and county has prepared their Housing Element in conformance with State
law. If HCD determines that the Housing Element is in compliance, then it is "certified" by HCD,
enabling the community to be eligible for grants and/or infrastructure funding. The public hearing
draft of the 2015 -2023 Housing Element is contained in Exhibit 1 of Attachment 1.
PREPARED BY: LAUREL R. PREVETTI��'" v" /�%�vW�
Assistant Town Man ager irector oaf Community Development
Reviewed by: N/A Assistant Town Manager —W own aA / Yown Attorney N IA Finance
N:\DEV\TC REPORTS12015\11cusing Elemengpedits.dw Revised: 4/29/15 1:06 PM
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
All cities and counties in California are given housing targets for the planning period of the Housing
Element known as the Regional Housing Need Allocation (RHNA) numbers. Through a
methodology that is adopted by the Association of Bay Area Governments (ABAG), each city and
county in the Bay region received its fair share allocation for very low, low, moderate, and above
moderate income housing. Table 1 below provides the income ranges for each category and sample
occupations for Santa Clara County.
T
The Town's Regional Housing Need Allocation for the 2015 — 2023 planning period is 619 housing
units distributed across the income categories as shown in Table 2.
Table 2: Town of Los Gatos Regional Housing Need Allocation for 2015 — 2023
RIINA
i
Very Low 201
Low 112
Moderate 132
Above Moderate 174
The Housing Element is required to identify specific properties that are planned to accommodate the
RHNA during the planning period. The Housing Element must also contain an assessment of the
housing needs of a community, identify potential barriers to housing production, and describe
specific goals, policies, and programs to eliminate barriers and facilitate housing production on the
planned sites.
<50 %Area
Bank Teller, Preschool Teacher,
Very Low
Median Income
$53,030
Home Health Aide, Restaurant Cook
(AMI)
Low
51 -80 %AMI
$84,900
Real Estate Agent, Social Worker,
Fire Dispatcher
Moderate
81 -120 %AMI
$126,600
Optometrist, Police Officer,
Electrical Engineer
Above
Physician, Aerospace Engineer
Moderate
> 120 %AMI
Over $126,600
The Town's Regional Housing Need Allocation for the 2015 — 2023 planning period is 619 housing
units distributed across the income categories as shown in Table 2.
Table 2: Town of Los Gatos Regional Housing Need Allocation for 2015 — 2023
RIINA
i
Very Low 201
Low 112
Moderate 132
Above Moderate 174
The Housing Element is required to identify specific properties that are planned to accommodate the
RHNA during the planning period. The Housing Element must also contain an assessment of the
housing needs of a community, identify potential barriers to housing production, and describe
specific goals, policies, and programs to eliminate barriers and facilitate housing production on the
planned sites.
PAGE 3
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
ANALYSIS:
Public Process for Preparing the Housing Element
The Town Council appointed a Housing Element Advisory Board (HEAB) to assist in the
preparation of the Housing Element. The Board consisted of the General Plan Committee (GPC) and
four members of the community. Former Planning Commissioner and current Council Member
Sayoc served as chair and Mayor Jensen as Vice Chair. Because its work overlapped Town Council
and Planning Commission terms and their respective membership to the GPC, the Board had some
membership changes early in 2015 with Commissioner Talesfore being added and Vice Mayor
Spector leaving the HEAB.
All other members were the same even though their affiliation changed. For example, Council
Member Sayoc replaced Vice Mayor Spector on the GPC; Commissioner Hanssen was appointed to
the GPC (freeing up a community member seat); and former Planning Commission Chair Smith
switched to serving as one of the community members. Commissioner Erekson remained on the
General Plan Committee and served the entire time on the HEAB. The other community members
were Maria Ristow, Jeff Loughridge, and John Bourgeois.
The HEAB provided an important opportunity for the public to participate in the Housing Element
process. All meetings were held in the evening and the public was provided opportunities to present
information and viewpoints to the HEAB for its consideration.
Adequate Sites to Meet the Housing Need
The HEAB worked with staff to identify sites to meet the RHNA and reviewed drafts of the Housing
Element. In June 2014, the HEAB decided to satisfy the RHNA primarily with existing Affordable
Housing Overlay Zone (AHOZ) sites (see Table 3). These sites formed the basis of the draft
Housing Element that was provided to the Planning Commission in late August 2014 and Council in
early September, and was formally submitted to HCD in September for its review.
After receiving comments from HCD in November, the HEAB had extensive discussions regarding
density bonuses, by right development, and other technical issues, resulting in the selection of a
different set of sites to accommodate the RHNA with the North 40 Specific Plan playing a larger role
(see Table 4). On March 5, 2015, a majority of the HEAB voted to recommend adoption of the
Housing Element, with some additional changes, to the Planning Commission and Town Council
(Smith and Hudes opposed).
PAGE 4
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
Table 3: Housing Element Advisory Board Initial Ontinnc to Mnnf RwNA a,.no Ime)
Table 4: Housing Element Advisory Board Final nntianc t., Moaf RHNA fk4..,...6 Inic.
Very
Low,
Mod.
Above
Total
RHNA — Total Units Needed (2015 -2023)
Low
112
132
Mod.
619
RHNA — Total Units Needed (2015 -2023)
201
112
132
174
619
Approved Units
0
0
2
14
16
Existing Affordable Housing Overlay Zoning
0
28
0
28
Sites (AHOZ)
144
86
112
86
428
Second Units Under the Town's Existing
156
84
98
26
364
Program
0
0
28
0
28
Proposed Enhanced Second Unit Program:
202
113
132
174
621
Non - Conforming Lots & Hillside Lots
0
27
0
0
27
Proposed North 40 Specific Plan
57
0
0
0
57
Vacant Housing Element Sites
Oka Road Sites
0
0
0
74
74
Total Units
201 1
113
142
174
630
Units Above RHNA
0
+1
+10
0
+11
Table 4: Housing Element Advisory Board Final nntianc t., Moaf RHNA fk4..,...6 Inic.
Very
Low
Low
Mod.
Above
Mod.
Total
RHNA — Total Units Needed (2015 -2023)
201
112
132
174
619
Approved Units
0
2
6
49
57
Oak Rim/N. Blossom Hill (AHOZ)
46
0
0
0
46
Second Units under the Town's Existing Program
0
0
28
0
28
Proposed Enhanced Second Unit Program: Non-
Conforming Lots & Hillside Lots
0
27
0
0
27
Proposed North 40 Specific Plan
156
84
98
26
364
Vacant Housing Element Sites (based on existing
zoning): Oka Road Sites
0
0
0
99
99
Total Units
202
113
132
174
621
Units Above RHNA
+1
+1
0
0
+2
PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
Proposed Programs to Reduce or Eliminate Barriers
The Housing Element is required to identify specific programs to reduce or eliminate barriers to the
construction of affordable housing. Based on the comments from HCD, the Housing Element
includes several programs to meet State law and to facilitate housing on the RHNA sites. Among the
programs are:
• Modify the Town Code to change the affordability requirements for the Oak Rim/N. Blossom
Hill AHOZ site to a minimum of 40 percent low and very low income units.
• Amend the Town Code to add findings for by -right development.
• Adopt the North 40 Specific Plan and rezone 18.2 acres at a minimum density of 20 units per
acre to yield 364 units.
• Amend the Town Code to provide for an enhanced second unit program.
Additional Information
The HEAB considered a wide range of information as it formulated its decisions regarding adequate
sites and programs. All HEAB materials, including redlined versions of the draft Housing Element,
are posted to the Town's website:
httv:Hca-losizatos2.civicplus.com/DocumentCenter/Index/412
The Planning Commission conducted a workshop on the Housing Element and the materials
provided to the Commission are contained in Attachments 3 and 4. These materials include
questions and answers regarding density bonus, by right development, and other issues.
Other HEAB Recommendations
In addition to the recommendation on the Housing Element, the HEAB identified four topics for
future Town Council consideration (perhaps during the annual Strategic Goals discussion or future
General Plan Update):
• Complete an assessment of the needs for housing for households earning between 120 and
200% of County median income (i.e., "workforce" or entry level housing) and determine
policies, potential Code changes, and programs to meet this need.
• Evaluate the Town's requirements under State law to provide housing near planned transit
stations, even if the stations are not expected for 35 years.
• Examine the jobs /housing balance in the Town and identify actions to address any concerns.
• Expand the AHOZ design guidelines to include multi - family residential or be designated as
multi - family residential guidelines so that they may apply to other appropriate buildings sites.
PAGE 6
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
The HEAB also discussed the possibility of retaining a community forum to discuss housing issues.
After some discussion, the Board recognized that such a forum already exists in the Town in the
form of the General Plan Committee. The GPC would be the appropriate body to consider housing
policy issues and the public would be welcome to provide testimony.
The HEAB also considered identifying potential replacement sites if one of the RHNA sites does not
yield the planned level of housing. After much discussion, the HEAB decided that the Town would
address this situation if and when it occurs.
Plannine Commission Discussion and Recommendation
The Planning Commission conducted a noticed public hearing on the Housing Element on April 8,
2015. Two members of the HEAB and one community member provided testimony and
recommended adoption of the Housing Element with the sites identified by the HEAB. A fourth
speaker asked clarifying questions about the Housing Element to which staff responded. Verbatim
minutes of the proceedings are contained in Attachment 5.
After closing the public portion of the public hearing, the Commission discussed the Draft Housing
Element. Commissioner Erekson recommended reinserting a goal regarding a jobs and housing
balance that is contained in the current Housing Element (Goal 7). He also pointed out an
inconsistency between Action Items HOU -1.7 and HOU -2.2, which staff explained was an oversight.
The Planning Commission unanimously recommended to the Town Council that it adopt the
Housing Element, the associated General Plan Amendment Application GP -14 -002, the Addendum
to the General Plan Final EIR, and the four recommendations from the Housing Element Advisory
Board (Commissioner O'Donnell absent).
As part of the motion, the Commission recommended that the Council modify the Housing Element
and reinsert a goal for a jobs- housing balance in the Town (see Additional Revisions in Attachment
6). In addition, the Commission made the following suggestions in the same manner as the HEAB
for consideration during the Strategic Goals setting session:
Consider modifying the Town's Design Guidelines to encourage first floor master bedrooms
in new housing developments designated to meet the needs of the Town's growing senior
population;
• Send the AHOZ back to the General Plan Committee to determine:
• Does the Town still need the AHOZ assuming that the Town has identified adequate
sites for the Housing Element?
• Do we want to keep the AHOZ sites not used in the Housing Element?
• Should the AHOZ Design Guidelines be modified to remove single- family homes
and other lower density housing types?
PAGE 7
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
The Commission also discussed the Town finding solutions for providing affordable housing by
seeking to go beyond the legal requirements. This discussion ultimately was not included in the
motion and instead was expected to be the context for the GPC's work on AHOZ or other housing
issues as directed by the Council.
Discussions with the California Department of Housing and Community Development (HCD)
Throughout the Housing Element update process, Planning staff has been in communication with
HCD. HCD reviewed the Public Hearing Draft Housing Element and found minor modifications
were still needed before HCD could determine that it could certify the document as complete and in
compliance with State law. Staff responded by submitting additional text modifications to HCD in
response to the comments (see Attachment 6).
At the time of this report's preparation, the Town is awaiting written confirmation from HCD that
the proposed revisions together with the Draft document meet State law. HCD staff verbally
indicated that the Town's Housing Element was compliant. If the letter is received prior to the
Council meeting, it will be provided as a Desk Item.
Adequate Sites
In light of the Council's recent discussions and motions regarding the North 40 Specific Plan, the
Council may choose to revise the identified sites to meet the Regional Housing Need Allocation to
reflect a maximum of 270 units in the Specific Plan. Table 5 on the next page shows a deficit of 92
units with the reduced Specific Plan yield.
The Town's existing AHOZ sites could be considered as replacement sites in the Housing Element.
The Council may choose to retain the Oak Rim/N. Blossom Hill site and add one or more of the
remaining AHOZ sites:
• Southbay (7.4 acres): 148 units
• Los Gatos Lodge Site A (1.5 acres): 30 units
• Los Gatos Lodge Site B (7 acres): 140 units
• Higgins Business Park (3.2 acres): 64 units
Alternatively, the Council may remove the Oak Rim/N. Blossom Hill site and replace the cumulative
total of 138 units with one or more AHOZ sites. It is acceptable for the Housing Element to identify
sites that would yield more housing than required by the RHNA.
The distribution across income categories can be achieved as needed because all of the sites meet the
required minimum density of 20 units per acre and therefore are considered affordable for purposes
of the Housing Element.
PAGE
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
Table 5: Revised Sites with Reduced Units in North 40 Specific Plan
ALTERNATIVES:
In light of the recent motions pertaining to the North 40 Specific Plan, the Council may modify the
identified sites to meet the Town's RHNA as discussed in the Analysis section of this report. The
Council may also add Action Items or make other modifications to the document. Staff will make
the corresponding edits to the Housing Element Public Hearing Draft and environmental clearance
document prior to submittal to HCD. Modification of the document is preferable over not adopting
the Town's 2015 -2023 Housing Element.
COORDINATION:
The preparation of the Housing Element was completed in close coordination with the Town
Attorney and staff from the California Department of Housing and Community Development.
FISCAL IMPACT:
There is no anticipated fiscal impact by adopting the Housing Element. The implementation of the
Action Items will be incorporated into the work plan for the Community Development Department.
Very
Low
Mod.
Mae
Total
Low
RHNA — Total Units Needed (2015 -2023)
201
112
132
174
619
Approved Units
0
2
6
49
57
Oak Rim/N. Blossom Hill (AHOZ)
46
0
0
0
46
Second Units under the Town's Existing
0
0
28
0
28
Program
Proposed Enhanced Second Unit Program: Non-
0
27
0
0
27
Conforming Lots & Hillside Lots
Proposed North 40 Specific Plan
156
84
30
0
270
Vacant Housing Element Sites (based on
0
0
0
99
99
existing zoning): Oka Road Sites
Total Units
202
113
64
148
527
Units Above RHNA
+1
+1
-68
-26
-92
ALTERNATIVES:
In light of the recent motions pertaining to the North 40 Specific Plan, the Council may modify the
identified sites to meet the Town's RHNA as discussed in the Analysis section of this report. The
Council may also add Action Items or make other modifications to the document. Staff will make
the corresponding edits to the Housing Element Public Hearing Draft and environmental clearance
document prior to submittal to HCD. Modification of the document is preferable over not adopting
the Town's 2015 -2023 Housing Element.
COORDINATION:
The preparation of the Housing Element was completed in close coordination with the Town
Attorney and staff from the California Department of Housing and Community Development.
FISCAL IMPACT:
There is no anticipated fiscal impact by adopting the Housing Element. The implementation of the
Action Items will be incorporated into the work plan for the Community Development Department.
PAGE 9
MAYOR AND TOWN COUNCIL
SUBJECT: HOUSING ELEMENT
APRIL 27, 2015
CEO A:
Addendum to the 2020 General Plan Final Environmental Impact Report (EIR).
Attachments:
1. April 8, 2015 Planning Commission Staff Report (including Exhibit 1: Public Hearing Draft
2015 -2023 Housing Element and Exhibit 2: Addendum to the General Plan Final EIR)
2. April 8, 2015 Planning Commission Addendum Report (includes Exhibits)
3. March 25, 2015 Planning Commission Housing Element Workshop Report
4. March 25, 2015 Planning Commission Housing Element Workshop Desk Item Report
5. April 22, 2015 Planning Commission Verbatim Minutes regarding the Housing Element
6. Additional revisions containing proposed text modifications to the Housing Element
7. Draft resolution to adopt the Housing Element and Addendum
LRP:cg
THIS PAGE
INTENTIONALLY
LEFT BLANK