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Attachment 1 April 8 PC ReportTOWN OF LOS GATOS PLANNING COMMISSION STAFF REPORT Meeting Date: April 8, 2015 PREPARED BY: Laurel Prevetti, Assistant Town Manager/ Community Development Director 1prevetti @losgatosca.gov APPLICATION NO: General Plan Amendment Application GP -14 -002 ITEM NO: 2 SUMMARY: Public Hearing to review and provide a recommendation to the Town Council regarding the 2015 -2023 Housing Element. RECOMMENDATION: Recommend to the Town Council that it adopt the Housing Element, associated General Plan Amendment Application GP -14 -002, and Addendum to the General Plan Final EIR; and consider the other recommendations of the Housing Element Advisory Board. CEQA: ACTION: EXHIBITS: BACKGROUND: Addendum to the 2020 General Plan Final Environmental Impact Report (EIR) Recommend to the Town Council that it: Adopt the Housing Element, associated General Plan Amendment Application GP -14 -002, and Addendum to the General Plan Final EIR; and 2. Consider the other recommendations from the Housing Element Advisory Board. 1. Draft 2015 -2023 Housing Element 2 Addendum to the General Plan Final EIR 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) determines 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, ATTACHMENT;1 Planning Commission Staff Report - Page 2 2015 -2023 Housing Element April 8, 2015 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. 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. Table 1: Income Categories and Sample Occupations, Santa Clara County < 50% Area i Bank Teller, Preschool Teacher, Very Low Median Income $53,030 Nome Health Aide, Restaurant (AMI) Cook Low 51 -80 %AMI $84,900 Moderate 81- 120 %AMI $126,600 Above >120'YoAMI Over $126,600 Moderate Real Estate Agent, Social Worker, Fire Dispatcher Optometrist, Police Officer, Electrical Engineer Physician, Aerospace Engineer 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 Very Low, Yw '- 201 112 Low Moderate 1 174 Above Moderate 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 Planning Commission Staff Report - Page 3 2015 -2023 Housing Element April 8, 2015 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. DISCUSSION: 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 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 as well as review 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 the California Department of Housing and Community Development (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). Planning Commission Staff Report - Page 4 2015 -2023 Housing Element April 8, 2015 Table 3: Housing Element Advisory Board Initial Options to Meet RHNA (June 2014) Table 4: Housing Element Advisory Board Final Options to Meet RHNA (March 2015) Very Low Low Mod. Above Total RHNA — Total Units Needed (2015 -2023) Low 112 132 174 619 RHNA —Total Units Needed (2015 -2023) 201 112 132 174 619 Approved Units 0 0 2 14 16 Existing Affordable Housing Overlay 144 86 112 86 428 Zoning Sites (AHOZ) 0 27 0 0 27 Second Units Under the Town's Existing 0 0 28 0 28 Program 0 0 0 99 99 Proposed Enhanced Second Unit Program: 0 27 0 0 27 Non - Conforming Lots & Hillside Lots +1 +1 0 0 +2 Proposed North 40 Specific Plan 57 0 0 0 57 Vacant Housing Element Sites 0 0 0 74 74 Oka Road Sites Total Units 201 113 142 174 630 Units Above RHNA 0 +1 +10 0 +11 Table 4: Housing Element Advisory Board Final Options to Meet RHNA (March 2015) Very Low Low Mod. Mode 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 Planning Commission Staff Report - Page 5 2015 -2023 Housing Element April 8, 2015 Proposed Pro2rams to Reduce or Eliminate Barriers The Housing Element is required to identify specific programs to reduce or eliminate barriers to the construction of 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 As discussed at the Planning Commission Study Session regarding the Housing Element on March 25, 2015, 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: http://ca-losgatos2.civicylus.com/DocumentCenter/Index/412 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. The HEAB also discussed the possibility of retaining a community forum to discuss housing issues, and acknowledged that the existing General Plan Committee serves this function. The HEAB also considered identifying potential replacement sites if one of the RHNA sites does not yield the Planning Commission Staff Report - Page 6 2015 -2023 Housing Element April 8, 2015 planned level of housing. After much discussion, the HEAB decided that the Town would address this situation if and when it occurs. ENVIRONMENTAL REVIEW: An Addendum to the General Plan Final EIR has been prepared that describes the 2015 -2023 Housing Element and evaluates the changes to the project that have occurred since the General Plan Final EIR was certified in September 2010 (see Exhibit 2). There are no significant impacts associated with the proposed Housing Element. SUMMARY AND RECOMMENDATION: Given the work completed by the HEAB to consider a variety of complex issues associated with the Housing Element, staff recommends that the Planning Commission recommend that the Town Council adopt the Housing Element, associated General Plan Amendment Application GP -14 -002, and Addendum to the General Plan Final EIR. Staff also recommends forwarding the HEAB's other recommendations to the Town Council. The Planning Commission may have additional recommendations for Council consideration. Prepared and Approved by: Laurel R. Prevetti, Assistant Town Manager/ Director of Community Development LRP:cg N: \DEV\PC REPORTS\2015\2015 -2023 Housing Elernmtdoc