HomeMy WebLinkAbout6.4 Inclusionary Zoning Reg Attch 3-7~~3~~~
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RESOLUTION NO. 08-35
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF DUBLIN
RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE AMENDING
CHAPTER 8.68 OF THE DUBLIN MUNICIPAL CODE (THE INCLUSIONARY
ZONING REGULATIONS) RELATING TO ESTABLISHING FIXED SALES PRICES
FOR OWNER-OCCUPIED INCLUSIONARY UNITS; ELIMINATING THE
REQUIREMENT TO CONSTRUCT OWNER-OCCUPIED VERY-LOW INCOME
UNITS; AND, ALTERING THE FOR-SALE INCLUSIONARY UNIT INCOME
RATIOS (PA 08-041)
WHEREAS, a goal of the Housing Element is to achieve a balanced community with housing
available for households at a range of income levels; and
WHEREAS, accordingly, the City has adopted the Inclusionary Zoning Regulations ("the
Regulations"), set forth at Chapter 8.68 of the Dublin Municipal Code, which Regulations generally
require developers of residential housing in excess of 19 units in the City of Dublin to set aside 12.5% of
such units for very-low-, low-, and moderate-income households, as defined; and
WHEREAS, Staff has determined that the Regulations are in need of certain modifications and
has presented a draft Ordinance amending the Regulations to the Planning Commission at a public
hearing for a recommendation to the City Council; and
WHEREAS, proper notice of said public hearing was given in all respects as required by law; and
WHEREAS, the City of Dublin Planning Commission ("Planning Commission") held a public
hearing on said application on October 28, 2008; and
WHEREAS, the Planning Commission did hear and consider all said reports, recommendations
and testimony herein above set forth and used its independent judgment to evaluate the project; and
NOW, THEREFORE,. BE IT RESOLVED that the City of Dublin Planning Commission does
hereby find that:
A. That the City of Dublin Planning Commission does hereby recommend that the City Council
approve an Ordinance of the City Dublin amending Chapter 8.68 of the Dublin Municipal Code.
relating to Inclusionary Zoning regulations as set forth in the draft Ordinance attached as Exhibit
A.
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K:\Staff Reports- PC and CC\2008\PC\IZO Reso (2) 10-21-08.doc
Attachment 3
a ~` 4 ~ ~T
PASSED, APPROVED AND ADOPTED this 28th day of October, 2008 by the following vote:
AYES: Schaub, Tomlinson, Biddle and Wehrenberg
NOES:
ABSENT: King
ABSTAIN:
Planning Commission Chair
ATTEST:
Planning Manager
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K:\Staff Reports- PC and CC\2008\PC\IZO Reso (2) 10-21-08.doc
INCLUSIONARY ZONING REGULATIONS
Chapter 8.68
__ _ aye .
CHAPTER 8.68 INCLUSIONARY ZONING REGULATIONS
8.68.010. Purpose. The purpose of this chapter is to:
A. enhance the public welfare and assure that further housing development contributes to the attainment
of the City's housing goals by increasing the production of residential units affordable by households
of very low, low, and moderate income.
B. assure that the limited remaining developable land in the City's planning area is utilized in a manner
consistent with the City's housing policies and needs.
8.68.020. Definitions. As used in this chapter, each of the following terms shall be defined as follows:
A. "Affordable Unit" means an ownership orrental-housing unit, including senior housing, affordable to
households with very-low, low, or moderate incomes as defined in this chapter.
Rental units are deemed affordable units if the annual rent does not exceed 30% of maximum
income level for very-low-, low-, audrnoderate-income households, adjusted for household
size and as defined below.
2. Owner-occupied units are deemed affordable units if the sales price results in annual housing
expenses that do not exceed 35% of income level for very-low-, low-, and moderate-income
households, adjusted for household size and as defined below. For a very low-income owner-
occupied units, the unit shall be deemed an affordable unit if the sales price results in annual
housing expenses that do not exceed 35% of the maximum in the very low-income level,
adjusted for household size and as defined below.
B. "Applicant" means any person, firm, partnership, association, joint venture, corporation, or any
entity or combination of entities that seeks city real property development permits or approvals.
C. "Dwelling unit" means a dwelling designed and intended for occupancy by one household.
D. "Very-low-, low-, and moderate-income levels" means those income and eligibility levels
determined periodically by the California Department of Housing and Community Development
based on Alameda County median income levels adjusted for family size.. Such levels shall be
calculated on the basis of gross annual household income considering household size and number of
dependents, income of all wage earners, elderly or disabled family members, and all other sources of
household income and will be recertified as set forth by local standards, and state and federal housing
law.
"Very-low income" means 50% or less of the median income, adjusted for actual household
size.
2. "Low income" means more than 50% to 80% of the median income, adjusted for actual
household size.
3. "Moderate income" means more than 80% to 120% of the median income, adjusted for actual
household size.
City of Dublin Zoning Ordinance 68-1 September, 1997
Revised March 2005
Attachment 4
a~ ~ ~~~
INCLUSIONARY ZONING REGULATIONS
Chapter 8.68
E. "Resale controls and/or rent restrictions" means legal restrictions by which the affordable units shall
be restricted to ensure that the unit remains affordable to very-low-, low-, or moderate-income
households, as applicable, for a period of not less than 55 years. With respect to rental units, such
rent restrictions shall be in the form of a regulatory agreement recorded against the applicable
property. With respect to owner-occupied units, such resale controls shall be in the form of resale
restrictions, deeds of trust, and/or other similar documents recorded against the applicable property.
F. "Residential development" includes, without limitation, detached single-family dwellings, multiple-
. dwelling structures, groups of dwellings, condominium or townhouse developments, condominium
conversions, cooperative developments, mixed use developments that include housing units, and
residential land subdivisions intended to be sold to the general public.
8.68.030. General Requirements
A. 12.5% Affordability Requirement. All new residential development projects of 20 units or more
designed and intended for permanent occupancy shall construct 12.5% of the total number of
dwelling units within the development as affordable units, except as otherwise provided by this
chapter. The foregoing requirement shall be applied no more than once to an approved development
(and generally at the tentative map stage), regardless of the changes in the character or ownership of
the development, provided the total number of units does not change.. In applying and calculating the
affordability requirement, any decimal fraction less than or equal to 0.50 maybe disregarded, and any
decimal fraction greater than 0.50 shall be construed as one unit.
B. Allocation of Units to Income Levels. Affordable units provided pursuant to this section shall be
allocated to households with very-low, low-, and moderate-income levels as follows:
Very-low-income households 30%
Low-income households 20%
Moderate-income households 50%
Where the calculation of the allocation results in fewer units that would otherwise be required
pursuant to subdivision A above, one additional unit should be allocated to the income level with a
decimal fraction closest to 0.50.
C. Conditions of Approval: Any tentative map, conditional use permit, or site development review
approving residential development projects subject to this chapter shall contain conditions sufficient
to ensure compliance with the provisions of this chapter. Such conditions shall detail the number of
affordable units required, specify the schedule of construction of affordable units, set .forth the
applicant's manner of compliance with this chapter, and require the execution of an agreement
imposing appropriate resale coritrols and/or rental restrictions on the affordable units.
D. Concurrent Constructio~r. All affordable units in a project or phase of a project shall be constructed
concurrently with market-rate units, unless the City Manager determines in writing that extenuating
circumstances exist that make concurrent construction infeasible or impractical.
E. Design and Distribution of Affordable Units. All affordable units shall reflect the range of
numbers of bedrooms provided in the project as a whole and shall not be distinguished by exterior
City of Dublin Zoning Ordinance 68-2 September, 1997
Revised March 2005
~~~
INGLUSIONARY ZONING REGULA NS
Chapter 8.68
design, construction, or materials. Affordable units may be of smaller size than the units in the project
and may have fewer amenities than the market rate units in the project. All affordable units shall be
reasonably dispersed throughout the project.
8.68.040. Exceptions to 12.5% Affordability Requirement. Developers ofprojects subject to 8.68.030A
shall construct 12.5% of the total number of dwelling units within the development as affordable
units, unless subject to an exception set forth in this section. All exceptions require City Council
approval, which shall be obtained at or prior to the last discretionary approval for, the project.
A. Payment of Fees In Lieu of Creation of Affordable Units. Upon request of the applicant, the City
Council shall permit the applicant to pay a fee in lieu of constructing up to 40% of the affordable
units that the developer would otherwise be required to construct pursuant to Section 8.68.030A. The
amount of the fee shall be as set forth in a resolution of the City Council, which maybe amended
from time to time to reflect inflation and changed conditions in the City and the region. In lieu fees
shall be paid at the time and in the amount set forth in the in lieu fee resolution in effect at the time of
issuance of the building permit.
B. Off-Site Projects. An applicant may construct the affordable units not physically within the
development in lieu of constructing some or all of the affordable units within the development, with
the approval of the City Council, if the City Council finds:
1. that construction of the units off-site in lieu of constructing units on-site is consistent with the
chapter's goal of creating, preserving, maintaining, and protecting housing for very low-, low-
- and moderate:income households.
2. that the units to be constructed off site are consistent with Section 8.68.030E above.
3. that it would be infeasible or impractical to construct affordable units on-site.
4. that conditions of approval for the project require that the off-site affordable units would be
governed by the terms of a deed restriction and,"if applicable, rental restrictions similar to that
used for the on-site affordable units.
5. that the conditions of approval for the project, or other security such as a cash deposit, bond,
or letter of credit, are•adequate to require the construction of the off-site affordable units
concurrently with the completion of the construction of the residential development or within
a reasonable period (not to exceed 5 years).
C. Land Dedication. An applicant may dedicate land to the City or city-designated local non-profit
housing developer in lieu of construction of some or all of the required affordable units, if the
Council finds that:
1. that dedication of land in lieu of constructing units is consistent with the chapter's goal of
creating, preserving, maintaining, and protecting housing for very-low, low- and moderate-
-income households.
2. that the dedicated land is useable for its intended purpose, is free of toxic substances and
contaminated soils, and is fully improved, with infrastructure, adjacent utilities, grading, and
all development-impact fees paid excluding any inclusionary zoning ordinance fees.
City of Dublin Zoning Ordinance 68-3 September, 1997
Revised March 2005
c~ ~'7~,W
INCLUSIONARY ZONING ~~UL~IONS°
Chapter 8.68
3. that the proposed land dedication is of sufficient size to meet the following requirements:
a. the dedication includes land sufficient to construct the number of units that the
applicant would otherwise be required to construct by Section 8.68.030.A, based on
the size of lots in-the subdivision for which the applicant is meeting its obligation; and
b. in addition, the dedication includes such additional land the market value for which is
equal to or exceeds the difference between the value of a market-rate, 1200-square
foot unit and the~price at which such a unit could be sold as an Affordable Unit (which
amount shall be set forth in a resolution adopted from time to time by the City
Council) times the number of units required.
D. Credit transfers. An applicant may fully or partially satisfy the requirements of Section 8.68.030A
through the use of transfer credits created pursuant to Section 8.68.060. Credit certificates shall be
presented to the Community Development Director, who shall note at the time of proj ect approval the
credit certificate by number. Credit certificates may only be used to satisfy the requirements for
Inclusionary Units for the income category (i.e., very low, low, or moderate) and number of
bedrooms for which they are issued.
E. Waiver of Requirements. The City Council, at its discretion, may waive, wholly or partially, the
requirements of this ordinance and approve alternate methods of compliance with this Chapter if the
applicant demonstrates, and the City Council finds, that such alternate methods meet the purposes of
this Chapter.
8.68.050. General Procedures for Implementing Inclusionary Zoning Requirements
A. Agreements. Prior to the issuance of a building permit for an affordable snit, resale restrictions or
rental controls, or both, as the case maybe, shall be set forth in an agreement between the City and
the developer, in a form consistent with the City Council-adopted form agreement, which agreement
shall be recorded against the property containing the affordable units. The agreement shall be
executed by the City Manager, and its requirements shall run with the land and bind the applicant's
successors.
B. Rental Units; Occupancy; Annual Report. Agreements involving rental units shall require the
owner of the affordable units to ensure that the units are occupied by tenants whose monthly income
levels do not exceed very low-, low-,or moderate income levels, as the case maybe, and shall
preclude tenants from subletting or subleasing the unit. The agreement shall also require the owner
of the affordable unit to submit an annual report to the City Manager, in a format approved by the
City. The report shall include, but not be limited to the following information: an identification of the
affordable units within the project; the monthly rents charged and proposed to be charged; vacancy
information for the prior year; and the monthly income for tenants of each affordable unit throughout
the prior year.
C. Ownership Units; Occupancy; City's Right of First Refusal. Agreements for ownership units
shall specify that the inclusionary units must be occupied by the owner or owners and may not be
leased or rented without the written approval of the City. The resale restrictions shall provide that in
the event of the sale of an affordable unit, the City shall have the right to purchase any affordable
owner-occupant unit at the maximum price that could be charged to an eligible household.
City of Dublin Zoning Ordinance 68-4. September, 1997
Revised March 2005
_ INCLUSIONARY ZONING REGU~A~~~~
Chapter 8.68
D. Selection Criteria. No household shall be permitted to occupy a unit that is required under this
chapter to be affordable unless the City or its designee has approved the household's eligibility.
Eligible potential occupants of affordable units will be qualified on the basis of household income,
the median combined household income statistics for Alameda County published periodically by the
California Department of Housing and Community Development, all sources of household income
and assets, the relationship between household size and the size of available units, and any further
criteria required by law. The developer shall use an equitable selection method established in
conformance with the terms of this chapter. The selection criteria may not distinguish between adults
and children. Selection of qualified person should be based on priorities established using the point
system described below:
• Employed within the boundaries of the City of Dublin (3 points, one per household)
• Public Service employee working in the City of Dublin (1 additional point)
• Dublin resident (3 points, one per household)
• Seniors (1 point, one per household) ,
• Permanently disabled (1 poirit, one per household)
• Immediate family member of Dublin resident (1 point, one per household)
• Required to relocate from current Dublin residence due to demolition of dwelling or
conversion of dwelling from rental to for-sale unit (1 point, one per household)
To qualify as a "Public Service Employee", the person shall be employed by a Public Agency.
To qualify as "Employed within the boundaries of the City of Dublin", the person shall have been
employed within the City of Dublin for at least six months.
To qualify as a "Dublin resident," the person shall have been a resident of the City of Dublin for at
least cone-year period prior to the eligibility determination.
8.68.060, Affordable Unit Credits.
A. Creation. Affordable unit credits maybe created by the City Council. One affordable unit credit
certificate shall be issued for each affordable unit constructed in excess of the number of affordable
units required to be constructed for the project by Section 8.68.030A. The certificate shall designate
a specific income category (i.e., very-low, low, or moderate income) and number of bedrooms for
which they are issued..
B. Ownership and use of credits. Affordable unit credit certificates are issued to and become the
possession of the project owner, who may then use them to satisfy the requirements of this chapter
for another project in the City. If a project owner proposes to sell credit certificates, the parties shall
first obtain the consent of the Community Development Director, who will document the transfer by
certificate number.
City~of Dublin Zoning Ordinance 68-5 September, 1997
.Revised March 2005
~~n ~~ .~l
INCLUSIONARY ZONING REGUL IONS
Chapter 8.68
8.68.070. Incentives to Encourage On-Site Construction of Affordable Units. The City may, but shall
not be required to, offer incentives or financial assistance to encourage the on-site construction of
affordable units in excess of 12.5% of the total number of units in the project to the extent
resources for this purpose are available and approved for such use by the City Council or City
Manager. Such incentives may include, but shall not be limited to, the following:
A. ~ Fee Deferral.
1. Development Processing Fees. The City Manager may approve deferred payment of City
processing fees applicable to the review and processing of the project. The terms and
payment schedule of the deferred fees shall be subject to the approval of the City Manager.
2. Development Impact Fees. The City Council may authorize the deferred payment of
development impact fees applicable to the affordable units. Approval of this incentive
requires demonstration by the Applicant that the deferral increases the project's feasibility.
The applicant must provide appropriate security to ensure future payment of such fees.
B. Design Modifications. The City Council may approve design modifications to affordable units that
increase the feasibility of the construction of affordable units, including but not limited to, the
following:
Reduced lot size.
2. Reduced setback requirements.
3. Reduced open space requirements.
4. Reduced landscaping requirements.
Reduced interior or exterior amenities.
6. Reduction in parking requirements.
7. Height restriction waivers.
8.68.080. Inclusionary Zoning In Lieu Fee Fund. In Lieu Fees shall be deposited into a fund known as
the "Inclusionary Zoning In Lieu Fees Fund" ("Fund").
A. Use. All monies in the Fund, together with any interest earnings on such monies less reasonable
administrative charges, shall be used or committed to use by the City for the purpose of providing
very-low, low-, and moderate-income ownership or rental housing in the City of Dublin.
B. Annual report. The City Manager shall prepare an annual report to the City Council identifying the
balance of monies in the Fund and the affordable units provided and any monies committed to
providing very-low-, low-, and moderate-income housing. The annual report shall also include a
review of administrative charges.
8.68.090. Violations. It shall be unlawful for any person, firm, corporation, partnership or other entity that
is subject to this ordinance pursuant to section 8.68.030A to violate any provision or to fail to
City of Dublin Zoning Ordinance 68-6 September, 1997
Revised March 2005
a5- ~.a~~
INCLUSIONARY ZONING REGULA ONS
Chapter 8.68
comply with any of the requirements of this chapter. A violation of any of the provisions or
failing to comply with any of the requirements of this Chapter shall constitute a misdemeanor;
except that notwithstanding any other provisions of this Code, any such violation constituting a
misdemeanor under this chapter, may in the discretion of the enforcing authority, be charged and
prosecuted as an infraction. Any person convicted of an infraction under the provisions of this
Code shall be punishable as provided by the Government Code of the State of California.
8.68.100. Enforcement.
A. General. The City Manager shall enforce this chapter, and its provisions shall be binding on all
agents, successors, and assigns of an applicant. The City Manager may suspend or revoke any
building permit or approval upon finding a violation of any provision of this chapter. No land-use
approval, building permit, or certificate of occupancy shall be issued for any residential development
unless exempt from or in compliance with this chapter. The City may institute any appropriate legal
actions or proceedings necessary to ensure compliance herewith, including, but not limited to, actions
to revoke, deny, or suspend any permit or development approval.
B. Excessive rents legal action. If the City Manager determines that rents in excess of those allowed
by operation of this chapter have been charged to a tenant residing in an affordable unit, the City may
take appropriate legal action to recover, and the project owner shall be obligated to pay to the tenant,
or to the City in the event the tenant cannot be located, any excess rents charged.
8.68.110. Appeals. Decisions of the Gity Manager under this Chapter maybe appealed as provided in
Chapter 8.136.
City of Dublin Zoning Ordinance 68-7 September, 1997
Revised March 2005
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A regular meeting of the City of Dublin Housing Committee was held on Thursday, October 9,
2008 in the Wells Middle School Library, 6800 Penn Drive, Dublin. Mary Rose Parkman,
Housing Committee Chair called the meeting to order at 6:06 p.m.
CALL TO ORDER/ROLL CALL
Present: Committee Chair Mary Rose Parkman; Committee Members Kathy Avanzino, Ronald
De Diemar, Dale Garren, and Rick Runnels; Jeri Ram, Community Development Director; John
Lucero, Housing Specialist; Gaylene Burkett, Housing Assistant; and Taryn Gavagan,
Recording Secretary.
Absent: Vice Chair Christine Kaehuaea; Committee Members Don Biddle and Steve Murdock.
ORAL COMMUNICATION -NONE
MINUTES OF PREVIOUS MEETINGS
On a motion by Committee Member De Diemar, seconded by Committee Member Runnels, the
minutes of the September 18, 2008 meeting were unanimously approved. .
WRITTEN COMMUNICATIONS -NONE
NEW BUSINESS
7.1 Changes to the Inclusionary Zoning Ordinance
Mr. John Lucero, Housing Specialist, presented the PowerPoint presentation, highlighting the
Proposed Inclusionary Zoning Ordinance Modifications.
Mr. Lucero briefly discussed the background of the Inclusionary Zoning Ordinance and stated
that Staff reviewed the current Inclusionary Zoning Ordinance and is proposing modifications
to the Ordinance. Mr. Lucero then stated that Staff is proposing to move to set sales prices for
below market rate (BMR) units for low- and moderate-income units. Mr. Lucero discussed how
set prices for the BMR units will be determined for low- and moderate-income households, and
presented an example calculation.
Housing Committee 43 October 9, 2008
Attachment 6
DRAFT
Committee Member Runnels asked if only the Applicants' income is counted. Mr. Lucero
replied that household income is all income from all adult (18 years of age or older) household
members.
Committee Member Avanzino asked if the calculation being presented is assuming that the
applicant is getting 100% financing. Mr. Lucero replied that the calculation presented does not
assume that an applicant is receiving 100% financing. The City will be revising the current
BMR guidelines to require applicants to have, at least, a 5% down payment.
Committee Chair Parkman clarified that the total household income is being counted and not
just the income of those who are going to hold Title on the home.
Mr. Lucero stated that Staff is currently working with City Attorneys to solidify the definition
of a household.
Mr. Lucero stated that Staff is proposing to eliminate very-low-income units due to stringent
mortgage financing and developers having difficulty finding very-low-income households. He
further stated that very-low households are being qualified with more money because their
gross pay is being qualified, and not their net income. He stated that very-low-income
households, often, are not able to fund the proper maintenance for their home once purchased.
Mr. Lucero stated that, in addition to setting prices for BMR For-Sale units, Staff is also
proposing to set rental rates for BMR For-Rent units. He clarified that, currently, the rental
prices for BMR For-Rent units are calculated the same way prices for BMR For-Sale units are
being calculated. Mr. Lucero briefly compared the way rental prices are currently calculated
with the way Staff is proposing to calculate them in the future.
Committee Member ~Avanzino asked why the one and a half person per bedroom rule isri t
being applied to the BMR rental guidelines. Mr. Lucero replied that Staff is considering
applying the "two plus one" rule.
Committee Member Avanzino asked what happens if a developer is receiving funding from
TCAC. Mr. Lucero replied that if a developer has some kind of other funding sources like
TCAC or low-income tax credits, the City would follow the guidelines required by the source of
funding, as oppose to the Inclusionary Zoning Ordinance, to enable to developer to keep their
source of funding.
Committee Member Garren asked if rents are adjusted downward to allow for utilities. Mr.
Lucero replied that if the tenant's rent does not include utilities, the Alameda County Housing
Authority's standard utility allowance would be subtracted from the maximum rent.
Committee Member Garren stated that the Inclusionary Zoning Ordinance Update presentation
was received well at the Developer Meeting on Tuesday, October 7, 2008.
Mr. Lucero concluded the presentation and opened the floor for comments.
Housing Committee 44 October 9, 2008
DRAFT
~~ ~ ~~~
D~FT
Committee Member De Diemar asked if there is a downside to the update. Mr. Lucero replied
that changes have been requested by the development community and the proposed changes
would enable Staff to run the-BMR program much more efficiently. Mr. Lucero stated that the
Inclusionary Zoning Ordinance has not. been updated since 2005 and needs to be updated due
to the market fluctuation. He further stated that the proposed changes will help uniform the
City's Housing Programs with Alameda County and other jurisdictions.
Committee Chair Parkman stated that having fixed sales prices for BMR For-Sale units is a great
idea.
Committee Member De Diemar asked why 35% of the total household income is calculated for
household expenses as oppose to another percent. Mr. Lucero replied, stating that 35% is what
the City currently uses per the Inclusionary Zoning Ordinance; in addition, 35% is the
qualifying ratio the financial industry uses.
Committee Member De Diemar asked what the rational is for eliminating very-low BMRFor-
Sale units. Mr. Lucero replied that, currently, mortgage financing is very stringent, making it
much more difficult for very-low-income households to qualify for a loan. Mr. Lucero stated
that many very-low-income households may have a total debt-to-income ratio that does allow
for access for a mortgage loan and, in addition, many lenders use the gross income for
calculations as oppose to the net income, leaving many very-low-income households unable to
maintain their purchased property.
Ms. Gaylene Burkett, Housing Assistant, stated that many very-low-income applicants have just
enough money in their Savings account for a down payment; however, this leaves them with
very little reserves after escrow closes.
Committee Member Avanzino stated that eliminating very-low-income units .enables the
development community to leave those specific types of units out, but does not discourage
eligible households from buying units.
Mr. Lucero stated that the City wants to avoid setting people up for failure. He further stated
that the City works with the Tri-Valley Housing Opportunity Center so that potential BMR
buyers can get the proper education and resources for successful homeownership.
On a motion by Committee Member Avanzino and a second by Committee Member De
Diemar, the Housing Committee unanimously approved forwarding the recommended
changes to Planning Commission for review.
UNFINISHED BUSINESS -NONE
OTHER BUSINESS
Housing Committee 45 October y, ~uu~
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9.1 Staff Updates
Mr. Lucero stated that Staff is moving forward with the First Time Homebuyer Loan Program
(FTHLP). He further stated that Staff is seeing more FTHLP applicants with market rate homes
as oppose to below market rate homes.
Committee Member Garren asked if the Housing Committee has recommended $750,000 for the
Fiscal Year 08-09 FTHLP. Ms. Jeri Ram, Community Development Director, replied that
$750,000 was recommended but City Council approved $500,000.
Mr. Lucero briefly discussed the FTHLP- guidelines.
Committee Chair Parkman asked if the Resale Restriction Agreements for below market rates
units are being recorded first. Mr. Lucero replied that Staff is currently discussing that with
City Attorneys. He stated that the Resale Restriction Agreements are currently being recorded
second and clarified that the Performance Deed of trust does not hold any monetary value.
ADTOURNMENT
The meeting was adjourned at 7:11 p.m.
Respectfully Submitted,
Housing Committee Chair
ATTESTED:
Community Development Director
K: lHousing CommitteelMinutes12008110.9.08.doc
Housing Committee 46 October y, ~uu~
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~~ Planning Commission Minutes
a October 28 2008
Tuesd y, ,
CALL TO ORDER/ROLL CALL
A regular meeting of the City of Dublin Planning Commission was held on Tuesday, October
28, 2008, in the City Council Chambers located at 100 Civic Plaza. Chair Schaub called the
meeting to order at 7:OOp.m.
Present: Chair Schaub; Vice Chair Tomlinson; Commissioners Wehrenberg and Biddle; Mary Jo
Wilson, Planning Manager; Jeff Baker, Senior Planner; John Lucero, Housing Specialist; and
Debra LeClair, Recording Secretary.
Absent: Commissioner King
ADDITIONS OR REVISIONS TO THE AGENDA -NONE
MINUTES OF PREVIOUS MEETINGS - On a motion by Cm. Wehrenberg, seconded by Cm.
Tomlinson the minutes of the October 14, 2008 meeting were approved.
ORAL COMMUNICATIONS -NONE
CONSENT CALENDAR -NONE
WRITTEN COMMUNICATIONS -NONE
PUBLIC HEARINGS -
8.1 PA 07-056 Croak and Jordan Medium Density: General Plan and Eastern Dublin
Specific Plan Amendment to require 50 % of the units within the Medium Density
Land Use Designation on the Croak and Jordan properties provide private yards, and
a PD -Planned Development Rezone with amended Stage 1 Development Plan to
establish revised private yard standards within the Medium Density Land Use
Designation on the Croak and Jordan properties.
Jeff Baker, Senior Planner presented the project as stated in the Staff Report.
Cm. Tomlinson asked if the size of the common area is defined in the resolution. Mr. Baker
answered the Council did not. define the common area, but it would be studied with the-Stage 2
PD and SDR as part of the development application process as is our current practice.
Cm. Wehrenberg asked how the SDR process would be handled if the developers cannot meet
the requirements and would it be dealt with on a case-by-case basis. Mr. Baker answered that
was correct; they would be required to meet these standards and if they could not they would
have to request an exception; a General Plan Amendment if they could not meet the 50%
requirement or a PD amendment if they could not meet the development standards for private
yards which would require further action from the Planning Commission.
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Cm. Wehrenberg commented the Planning Commission will have another opportunity o
review this during the SDR process and it would be determined at that point what type of
product will be submitted. Mr. Baker answered in order for these sites to be developed they
would be required to obtain approval of a Stage 2 PD and SDR which would be reviewed by the
Planning Commission.
Cm. Biddle commented the Stage 2 PD and SDR are still forthcoming and there could still be the
option of a study. session if needed.
Cm. Wehrenberg asked if there are findings that must be made on .the resolutions being
reviewed at this meeting.
Mary Jo Wilson, Planning Manager answered yes; the Planning Commission could recommend
the findings in the GPA Resolution and the PD Ordinance; they could make the
recommendation in the positive to allow the City Council to follow the Commission's action to
approve or not.
Cm. Biddle stated the description does not restrict the yard to a rear yard, but there are
restrictions on what can be done in the front yards such as no privacy fence, etc. Mr. Baker
stated that through the PD process it allows the flexibility for where to locate the yards, but the
City has typically not allowed privacy fences in front yards.
Chair Schaub mentioned that it is sometimes difficult to determine where the front of the house
is because they are not traditional square houses. Mr. Baker stated the Planning Commission
would have the opportunity to review the SDR to ensure that it meets the requirements of the
resolution.
Cm. Tomlinson mentioned that the Council's intent was to have private yards and felt it would
most likely be either rear yards or side yards.
Chair Schaub opened the public hearing .and hearing no comments, closed the public hearing.
Chair Schaub stated that he feels this resolution is a perfect example of the City Council and the
Planning Commission trying perfect a policy. He felt this resolution solves the problem by not
splitting the density and creating fewer restrictions on the very small lots. He continued with
50% of yards, which is half of what is there, then half of the homes will be above midpoint with
plenty of land for the yards. He felt it was a tribute to the City Council that they rethought the
issue and came to this resolution.
Cm. Biddle stated that at some point the City Council and the Planning Commission members
all had concern with some aspect of the issue and felt the Council and Commission worked
through it together.
Cm. Tomlinson felt the beauty of the resolution is its simplicity. He stated the Council had the
goal of private, usable rear yards and felt that this resolution allows for a variety of product
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types with different ways of creating them and also offset what cannot be built with the
common area requirement. He stated he was in support of the resolutions.
On a motion by Cm. Wehrenberg and seconded by Cm. Biddle, on a vote of 4-0-1, with Cm.
King absent, the Planning Commission approved the following:
RESOLUTION NO. 08 - 33
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF DUBLIN
RECOMMENDING THAT THE CITY COUNCIL ADOPT A RESOLUTION AMENDING THE CITY
OF DUBLIN GENERAL PLAN AND EASTERN DUBLIN SPECIFIC PLAN TO REQUIRE THAT 50%
OF THE UNITS WITHIN THE MEDIUM DENSITY LAND USE DESIGNATION ON THE CROAK
AND JORDAN PROPERTIES PROVIDE PRIVATE YARDS
(APN 985-0027-007, 905-0002-001, AND 905-0002-002)
PA 07-056
RESOLUTION NO. 08 - 34
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF DUBLIN
RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE APPROVING A PD-
PLANNED DEVELOPMENT REZONE WITH AMENDED STAGE 1 DEVELOPMENT PLAN TO
ESTABLISH REVISED DEVELOPMENT STANDARDS FOR PRIVATE YARDS WITHIN THE
MEDIUM DENSITY LAND USE DESIGNATION ON THE CROAK AND JORDAN PROPERTIES
(APN 985-0027-007, 905-0002-001, AND 905-0002-002)
PA 07-056
8.2 PA 08-041 Inclusionary Zoning Ordinance (Chapter 8.68) of the Dublin Municipal
Code modifications to establish set sale prices for owner-occupied Inclusionary units,
eliminate the requirement for owner-occupied very-low income units, amend the for-
sale Inclusionary unit income ratios and allow for more frequent updates to the Lay
Person s Guide to the Inclusionary Zoning Ordinance (Legislative).
John Lucero, Housing Specialist presented the project as stated in the Staff Report.
Chair Schaub felt that the expenses that will be incurred by the applicant have not been taken
into consideration when calculating the price of the home; which include the mortgage
payment, HOA fees, GHAD fees and Private Mortgage Insurance (PMI). He stated the
maintenance costs for a detached unit are higher than an attached unit where there would be
higher HOA dues in order to cover maintenance costs. He felt the model that was used by the
Housing Division was not realistic as to the actual costs of owning a home. He stated the City
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should rethink the detached versus attached units, particularly in the lower income units, so
that when we provide the housing assistance they are not set up to fail.
Mr. Lucero answered the HOA fees for the developments are taken into account when doing
the calculations for the unit price. He stated that when the developer comes to the City with
their proposal, the HOA fees are taken into consideration and would be included at that time.
He stated the HOA fee amount mentioned in the Staff Report is an example. He continued that
there are HOA fees that range from $100 - $275 per month depending on the development. He
stated PMI is not used in these calculations. The price is set based on 70% of the Area Median
Income (AMI). He continued when looking at AMI for the individuals in the low category they
look for individuals in the 50%-80% of AMI range. He stated to assist individuals with a
manageable mortgage payment, the City offers the First Time Homeowner Loan Program
(FTHLP). He stated that this program makes funds available which can be used as a down
payment to lower their mortgage payment. He continued the FTHLP is a 30 year deferred loan,
therefore the applicant would not have to pay back the loan for 30 years or until they sell the
unit.
Chair Schaub asked how many loans can the City fund in the course of the year.
Mr. Lucero responded last fiscal year (07/08) the City funded a total of 15 First Time
Homebuyer Loans -14 for BMR units and 1 for a market rate unit. Currently there is not much
development in below market rate units. He stated the City has funded two loans for market
rate units since the beginning of this fiscal year and the average FTHB loan is $37,000. He felt
the Program has been a success and they are able to help individuals with lower mortgage
payments so they are not being strapped with payments they cari t afford. He stated there is
also assistance available from the State of California through the CAHFA who- provide 3%
down payment assistance. He continued there is assistance from Alameda County with a
Mortgage Tax Credit also, and feels the City is ensuring that the individuals buying these units
are setup so that they can succeed and not set up for failure.
Chair Schaub was concerned that the program is focused on mortgage payments and does not
take into consideration the cost of maintenance of a home versus maintenance costs for
condominiums. He felt the size of the house increases maintenance costs. He felt that the
maintenance issue has been a problem and he did not see it being addressed in this resolution
and felt the City should address the maintenance cost issue of attached versus detached units.
Cm. Tomlinson commented that the utility costs are dramatically different between attached
and detached units, particularly if the detached home is large.
Mr. Lucero stated the City uses the current national mortgage industry standard of 35% of
income for housing to qualify the applicants. He stated the ratios have changed over the year
but currently the mortgage industry will accept no more than 35 % of gross household income
towards a mortgage payment, and no more than 40% of total income to go towards mortgage
plus all other debt. He stated the City is confident that in using these ratios they are using ratios
that have been adopted by the housing industry and are prudent. He stated these are not the
ratios that allowed individuals to obtain mortgages with a 50=60% debt to income ratio, he
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stated the ratios being used by the City are the ones he personally used in 1991 when he first
joined the mortgage industry, pre-subprime lending. These ratios are conservative in
calculating what a household can afford.
Cm. Biddle suggested including a line on the calculation sheet for a maintenance fund.
Mr. Lucero stated that Staff is recommending that when calculating the total housing payment it
would include: homeowners insurance, property taxes and HOA fees. He stated that with a
recommendation from the Planning Commission, Staff could include additional line items such
as the maintenance fund.
Cm. Biddle stated a reserve fund could not be established for utilities, but it could be done for a
maintenance reserve fund.
Mr. Lucero responded that the Planning Commission could recommend that Staff include a line
item on the calculation sheet that includes any special assessments at the time the prices are
calculated.
Chair Schaub asked if the statement in the Staff Report that states "FHA loans and other mortgage
loan programs now require a down payment of at least 3-5%" is a correct statement. He felt that the
requirement is for a much larger down payment.
Mr. Lucero answered that FHA requires a down payment of 3% to 5%, and CaIHFA is .now
requiring a 5% down payment.
Cm. Biddle wanted to clarify if the developer, despite how many units available, creates a
calculation sheet for each unit before they go on sale so the developer and the buyer will know
what the price of the unit is before the sale.
Mr. Lucero answered yes, when the developer comes to Staff they would be able to give them a
set number based on today's interest rate, but would calculate the sales price of the house when
the City entered into the Affordable Housing Agreement (AHA).
Cm. Biddle asked if the prices are based on the unit and not household income and family size.
Mr. Lucero answered Staff completes a calculation sheet for each individual that applies for a
Below Market Rate (MBR) unit. Staff includes the annual household income into the formula
which creates the sales price. Mr. Lucero stated they have sold 124 BMR units and the prices all
varied.
Cm. Biddle asked if the adjustments are made according to the family income, etc., at the time of
the application and then are told what type/size house-they would qualify for.
Mr. Lucero answered yes, Staff would assume, when calculating the price, if the family
purchased a 2 bedroom unit, the sales price would assume a household size of 3 but there could
be 4 people living in the house. He stated these are only assumptions to base the sales price on
~~
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at the time. He stated that the information regarding the minimum and maximum occupancy of
the home is in The Lay Person s Guide to Inclusionary Zoning.
Cm. Biddle asked if the estimates are made for each unit whether for sale or rental. Mr. Lucero
answered yes. Cm. Biddle asked about what the rule is for a change of ownership, will the same
rules apply.
Mr. Lucero answered yes; if the unit is earmarked as a moderate unit it would have to be sold to
a moderate income family which would mean the maximum household income would be 120%
of the Area Median Income and the resale price is based on the Area Median Income. As an
example, for the past three years, during the first year the Area Median Income went up 2% and
the second year it went up 0% and then this year it went up 2.68%. He stated that each time
there is a rise in the AMI then there is a rise in the equity of the BMR units, Staff would multiply
that percentage by the base price and that would become the new sales price of the house.
Cm. Biddle asked who defines income and households and what is defined by the City and
what is defined by other regulations. Mr. Lucero answered the City uses the California State
Income Guidelines specifically for Alameda County which come from HUD, down to the State,
and then to the County. He stated the numbers are published every year in April.
Cm. Wehrenberg complemented Mr. Lucero on his presentation, and stated she was also
concerned about the other expenses in homeownership for BMR units and stated she would also
be concerned about foreclosures.
Cm. Tomlinson asked if there were representatives from the rental industry at the developer
meeting. Mr. Lucero answered no; there were representatives from D.R. Horton, Citation
Builders (Arroyo Vista), Pinn Brothers and from the Tri Valley Housing Opportunity Center
(TVHOC) representing Braddock & Logan.
Cm. Tomlinson stated he has associates who manage BMR rental units in other communities
who are having trouble finding qualified renters for the very low income category. He asked if
there had been any thought to making adjustments to that category. Mr. Lucero answered the
greatest need is in the very low income rentals and Staff feels comfortable with the ratios as they
are for rental units.
Chair Schaub stated there are 1201 total affordable units in some stage of either being. sold or
entitled but no construction started and asked if that was correct.
Mr. Lucero answered yes. Chair Schaub continued that 818 of that number are rental units, and
383 are for-sale units, and asked if that was correct.
Mr. Lucero answered yes; there are 818 rental units. At the time the chart was developed
Positano had 130 BMR for-sale units with a combination of detached homes, secondary units
and rentals. The number will be changed when the City Council approves the Affordable
Housing Agreement to show how the 130 units will be allocated.
6..-35. ~(.. .
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Chair Schaub asked if that would make 130 less units than the 383. Mr. Lucero answered yes;
there would be 253 units left.
Chair Schaub asked how many units have been sold. Mr. Lucero answered there have been 124
units sold and currently have 30 for-sale units on the market. Chair Schaub asked if that is the
current inventory of affordable for-sale units. Mr. Lucero responded there are 30 moderates, l8
low and 25 very-low income units which add up to 73 units available. Chair Schaub asked if
they were built and looking for buyers. Mr. Lucero answered most are not finished but the
developers are in an open-ended application period where they would accept applications for
the units. He stated the units are part of a Phase of the development and have not been built.
Chair Schaub asked how many units are available and unsold currently. He was concerned
about the inventory of unsold units for the City and the developers. Mr. Lucero stated the
unsold inventory would be 5 units that will be closing within 90 days.
Chair Schaub asked if there is a large inventory of unsold, affordable, for-sale units. Mr. Lucero
answered no, Elan has one moderate unit for sale, Silvera Ranch has one moderate, three low
and five very low units.
Chair Schaub asked if there are only five for-sale units in inventory, what problem is the City
trying to solve by changing the Ordinance. He felt the report showed a large problem in the
very-low category but with only five units in inventory it doesri t seem like a very big problem.
Mr. Lucero commented that Tralee is proposed to have four very low income units, and Cantara
will have another four very low income units, so there will be eight very low income units that
will come on the market soon.
Chair Schaub felt the action was proactive and that it is good to think about this issue before it
becomes a problem.
Cm. Tomlinson asked if the prospective buyers and renters are Dublin Residents or is the City
drawing in people with from other communities.
Mr. Lucero explained how the owners for the BMR units are chosen. He gave an overview of
the open application period and the preference points system that is used. He explained that
applicants with the largest number of preference points go to the top of the list and are offered
the unit first; if they dori t qualify the developer then would go down the list that was created
during the application period. All of the developers the City is currently working with are
using TVHOC to take in the applications, qualify the applicants and submit them to the City for
final review. He continued the developer brings their marketing plan to the housing division
for approval. The developers use local marketing and a local non-profit to help the developers
with sales of the units.
Cm. Wehrenberg asked if the City has a designated employee to coordinate the process. Mr.
Lucero answered there is a staff of 2 full time employees in the Housing Division that share the
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job duties. He stated there are annual monitoring reviews to assure that the individuals are still
living in the units.
Chair Schaub opened the public hearing and hearing no comment closed the public .hearing.
Cm. Biddle asked if when the worksheet is developed for each unit, it would be known exactly
the costs of homeowner's insurance, taxes, HOA fees, and PMI. Mr. Lucero responded the
Private Mortgage Insurance would not apply. There would only be costs for homeowner's
insurance, taxes and HOA fees and if there is a recommendation to add another item to the
worksheet we would use that as well.
Cm. Biddle asked if the City recommends an insurance company to the applicants for
homeowners insurance. Mr. Lucero stated no that is up to the homeowner.
Cm. Biddle felt the maintenance fund suggestion may be something the Commission would
want to review at a later date.
Chair Schaub felt the City should differentiate between attached versus detached homes and the
HOA fees and other fees that are associated with them. The condo/townhome fees will be
higher due to the reserve funds, but the maintenance costs of living in a single family home are
much higher and can be an unknown cost for a first time homebuyer.
Cm. Tomlinson felt the program is consistent with current loan underwriting standards. He
stated the marketing plan would include explaining what is included in the HOA fees for a
condo/townhome, such as roof replacement and landscaping. They would also explain the
HOA fees for single family homes where the responsibility to maintain their home falls to the
homeowner.
Cm. Biddle stated he had some experience with Habitat for Humanity which establishes a
maintenance reserve fund to replace a water heater, etc. He felt the problem is that someone
would need to manage the fund and keep track for each homeowner.
Chair Schaub felt that taking the very-low income category out of the program is helpful. He
felt that avery-low income family would find it hard to buy the things needed to maintain a
house.
Cm: Tomlinson felt that the resolution would bring certainty to the numbers because of the fact
that the developers are calculating the price of each home individually based on who the
applicant which could be a disincentive for that developer. He felt there was a larger issue and
wondered if the City Council would want the Commission to review the program. He was
concerned with the appropriateness of a developer selling a large single family home to a low-
income family which could be an economic burden to them. He felt it was noble to provide
housing for residents but the more problematic issue comes with the expense of maintaining a
larger home.
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Mr. Lucero stated that the City Council assigned a goal to the Housing Division to evaluate the
Inclusionary Zoning Ordinance and the effectiveness of it.
Chair Schaub asked if that would be part of the Housing Element and when that would be
presented to the Commission..
Ms. Wilson answered Staff hoped to have a draft Housing Element before the Joint Study
Session with the Planning Commission and the Housing Committee in early December 2008.
She further stated that the Inclusionary Zoning Ordinance is a separate and distinct item from
the Housing Element.
Jeri Ram, Community Development Director stated the goal is to examine the City's Affordable
Housing Programs in general and Staff is planning to bring that to the City Council the early
part of next year.
Chair Schaub asked if the Affordable Housing Programs would be reviewed with the Housing
Element. Ms. Wilson answered no; the effectiveness of the Affordable Housing Program is a
part of the Housing Element but a separate project.
Cm. Wehrenberg agreed with Cm. Tomlinson regarding the financial burdens and the
effectiveness of the program. She stated she has read the report and the selection criteria, and
asked if that would be addressed when studying the effectiveness of the Inclusionary Zoning
Ordinance. Mr. Lucero answered Staff would be reviewing the overall effectiveness of the
Inclusionary Zoning Ordinance.
Cm. Biddle felt the resolution was an improvement, and it is a good idea to review the
Ordinance periodically because conditions change and the City must change with them.
Chair Schaub commended Staff on being proactive and helping the developers and residents
with housing and felt the City should continue to review the Ordinance.
On a motion by Cm. Biddle and seconded by Cm. Wehrenberg, on a vote of 4-0-1, with Cm.
King absent, the Planning Commission approved the following:
RESOLUTION NO. 08-35
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF DUBLIN
RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE AMENDING
CHAPTER 8.68 OF THE DUBLIN MUNICIPAL CODE (THE INCLUSIONARY ZONING
REGULATIONS) RELATING TO ESTABLISHING FIXED SALES PRICES FOR OWNER-
OCCUPIED INCLUSIONARY UNITS; ELIMINATING THE REQUIREMENT TO
CONSTRUCT OWNER-OCCUPIED VERY-LOW INCOME UNITS; AND, ALTERING THE
FOR-SALE INCLUSIONARY UNIT INCOME RATIOS
(PA 08-041)
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NEW OR UNFINISHED BUSINESS -
Chair Schaub. felt, in order to move a project forward, Staff could use some flexibility to make
decisions that create moderate changes to projects. He felt that Staff understands what the
Planning Commission is looking for and can approve changes in a timely manner so that the
project can move forward.
Cm. Wehrenberg agreed with Chair Schaub but felt Staff could add a request to the. agenda if
there was a request that needed to be approved quickly.
Ms. Wilson answered that many times Staff has to make judgments based on what the
Commission has acted on in the past but there are times when Staff needs to send it back to the
Commission for approval according to the codes and previous approvals. There are times
when Staff may need to be slightly quicker to approve projects and will continue try to meet the
needs of the developers. She continued there are still changes that would need to come before
the Planning Commission and City Council. She explained the changes that would need to
come before the Commission are changes that Staff would not feel comfortable approving
without the Commission s input. She stated the Commission could go back and address the
SDR chapter at a later discussion is they felt it was necessary to expedite projects.
Cm. Wehrenberg stated she would be willing to accept less of a package and less discussion if
there was something that needed immediate response. Chair Schaub agreed.
Ms. Wilson stated that Staff must still do analysis for the Commission. There would have to be
written documentation for the record as well as the noticing process. Therefore, while Staff can
try to get things to the Commission quickly, there is still a lot of work that goes into providing
the information to the Commission.
Chair Schaub felt that if Staff has done the analysis on a project and still would like to bring it to
the Commission, whatever Staff had at that point is okay with him. Ms. Wilson stated Staff
would take that into consideration and agreed to respond to the Commission when a process
has been established if they decide to do that.
Chair Schaub stated the Commission does not want to "hang-up" anything unless need be. He
continued that the. Commission wants to do everything they can to help the developers
move/ sell houses.
OTHER BUSINESS -NONE
10.1 Brief INFORMATION ONLY reports from the Planning Commission and/or Staff,
including Committee Reports and Reports by the Planning Commission related to
meetings attended at City Expense (AB 1234).
10.2 Downtown Update - No new applications.
10.3 Mervyns is closing.
10.4 PC Rules and Procedures will be brought to Planning Commission in January 2009.
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10.5 The City Council will consider Planning Commission stipends on 11-4-08.
10.6 Holiday schedule for upcoming Planning Commission meetings:
11-12 - on Wednesday because of Veteran s day.
11-25 -Study session will begin at 6 p.m., with regular meeting to follow at 7:00 p.m.
12-9 -Joint Planning Commission/Housing Committee Study Session on the Housing
Element.
12-23 -possibly canceled because of closeness to holiday.
10.7 Cm. Wehrenberg asked if Ms. Wilson knew of a new Ordinance for LEED standards that
will become effective in 2010, but the City level has the option of adopting it before then
and is the City considering that. Ms. Wilson agreed to look into it.
ADJOURNMENT -The meeting was adjourned at 8:23 p.m.
Respectfully submitted,
Bill Schaub
Chair Planning Commission
ATTEST:
Mary Jo Wilson, AICP
Planning Manager
G: ~ MI NUTES ~ 2008 ~ PLANNING COMMISSION ~ 10.28.OS.doc
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