Atherton City Council
November 1, 2023

AGENDA PACKET
Town of Atherton – Joint Meeting
City Council
Planning Commission
NOVEMBER 01, 2023
SPECIAL MEETING – STUDY SESSION
4:00 PM
Council Chambers
80 Fair Oaks Lane, Atherton, CA 94027
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SPECIAL MEETING ­ STUDY SESSION
REMOTE PARTICIPATION:

TELECONFERENCE NOTICE Pursuant to Government Code Section 54953, Subdivision (b), the following City Council meeting includes teleconference participation by Council Member
Elizabeth Lewis
Homewood Suites by Hilton
2010 Hospitality Road
Medford, OR 97504, Rm. 431
ROLL CALL –
City Council: Holland, DeGolia, Lewis, Vice Mayor Hawkins­Manuelian, Mayor Widmer Planning Commission: Lerner, Tonelli, Bryant,  Polito, Lane PUBLIC COMMENT – Public Comments can be emailed directly to [email protected]
As a Special Meeting, Public Comment is limited to items that are on the Agenda. Speakers’ time is limited to three minutes. Speakers may also speak when the item comes up on the Agenda during the meeting.

STUDY SESSION

1. STUDY SESSION TO DISCUSS TOPIC AREAS FOR MULTIFAMILY HOUSING OBJECTIVE DESIGN AND DEVELOPMENT STANDARDS
CEQA:           Statutorily Exempt from CEQA under Section 15262, Feasibility and PliStdi
Meeting Agenda Packet – November 01, 2023

City Council: Holland, DeGolia, Lewis, Vice Mayor Hawkins­Manuelian, Mayor Widmer Planning Commission: Lerner, Tonelli, Bryant,  Polito, Lane PUBLIC COMMENT – Public Comments can be emailed directly to [email protected]
As a Special Meeting, Public Comment is limited to items that are on the Agenda. Speakers’ time is limited to three minutes. Speakers may also speak when the item comes up on the Agenda during the meeting.

STUDY SESSION

1. STUDY SESSION TO DISCUSS TOPIC AREAS FOR MULTIFAMILY HOUSING OBJECTIVE DESIGN AND DEVELOPMENT STANDARDS
CEQA:           Statutorily Exempt from CEQA under Section 15262, Feasibility and Planning Studies
Report: BRITTANY BENDIX, TOWN PLANNER
Recommendation: Staff recommends that the City Council and Planning Commission discuss and consider topic areas for multifamily housing objective design and development standards.

Description: The City Council and Planning Commission will discuss and consider topic areas for multifamily housing objective design and development standards.

COUNCIL REPORTS/COMMENTS

ADJOURN
PLEASE NOTE THE FOLLOWING INFORMATION:

If you challenge a Town zoning, planning, or any other decision in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this agenda, or in written correspondence delivered to the Town at, or prior to, the public hearing.  Judicial review of any Town administrative decision may be had only if a petition is filed with the court not later than the 90th day following the date upon which the decision becomes final.  Judicial review of environmental determinations may be subject to a shorter time period.

Copies of all staff reports and documents subject to disclosure that relate to each item of business referred to on the agenda are available for public inspection by 5:00 p.m. the Friday before each regularly scheduled City Council meeting.

Pursuant to the Americans with Disabilities Act, if you need special assistance in this meeting, please contact the City Clerk’s Office at (650) 752­0500.  Notification of 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.  (29 CRF

35.104 ADA Title II)
AB 2449 & AB 361:

AB 2449 reiterates standard Brown Act teleconference rules, re­codifies the rules set out in AB 361 for times of declared emergency, and also provides for relaxed teleconferencing rules when a member of the legislative body needs to attend remotely for an emergency, or other reasons supported by “just cause.”
Teleconference Rules Available January 1, 2023
Meeting Agenda Packet – November 01, 2023

enable the City to make reasonable arrangements to ensure accessibility to this meeting.  (29 CRF

35.104 ADA Title II)
AB 2449 & AB 361:

AB 2449 reiterates standard Brown Act teleconference rules, re­codifies the rules set out in AB 361 for times of declared emergency, and also provides for relaxed teleconferencing rules when a member of the legislative body needs to attend remotely for an emergency, or other reasons supported by “just cause.”
Teleconference Rules Available January 1, 2023
A legislative body may hold a “hybrid” (partial teleconference, partial in­person) meeting without having to comply with certain procedural requirements (post agendas at teleconference locations, identify teleconference locations in the agenda, make all teleconference locations open to the public) in the following limited circumstances:

One or more members of the legislative body (but less than a quorum) have “just cause” for not attending the meeting in person (childcare or family caregiving need, contagious illness, physical or mental disability need, or travel while on official public business); or One or more members of the legislative body (but less than a quorum) experience an “emergency circumstance” (a physical or family medical emergency that prevents in­person attendance).

The legislative body will continue to have the option to meet via teleconference by following traditional Brown Act rules of identifying, posting, and opening up their teleconference locations.

Meeting Agenda Packet – November 01, 2023

Item No. 1
Town of Atherton

CITY COUNCIL AND PLANNING COMMISSION - STUDY SESSION
TO: HONORABLE MAYOR AND CITY COUNCIL

GEORGE RODERICKS, CITY MANAGER
FROM: BRITTANY BENDIX, TOWN PLANNER
DATE: NOVEMBER 1, 2023
SUBJECT: STUDY SESSION TO DISCUSS TOPIC AREAS FOR MULTIFAMILY

HOUSING OBJECTIVE DESIGN AND DEVELOPMENT STANDARDS
CEQA: Statutorily Exempt from CEQA under Section 15262, Feasibility and Planning Studies

RECOMMENDATION
Staff recommends that the City Council and Planning Commission discuss and consider topic areas for multifamily housing objective design and development standards.

BACKGROUND
On January 31, 2023, the Town Council adopted Atherton’s 2023-2031 Housing Element and submitted a copy to the Department of Housing and Community Development (HCD) for review and certification. The adopted Housing Element includes goals, objectives and programs that facilitate the by-right approval of multifamily housing projects, subject to objective design and development standards adopted by the Town. However, subsequent feedback from HCD indicated that to receive certification, the Town must expand its multifamily housing program to address Affirmatively Furthering Fair Housing (AFFH) requirements. Furthermore, because the Town did not adopt an HCD certified housing element within 120 days of the statutory deadline (January 31, 2023), any rezoning or modifications to the zoning ordinance necessary to enact the element’s housing programs and achieve its regional housing needs allocation must be completed by January 31, 2024. This includes the adoption of objective design and development standards for multifamily housing.

This report provides an introduction to typical objective design and development standards that could apply to multifamily sites identified in the current or amended Housing Element.

Additionally, the report includes a summary of feedback received at a community workshop held on October 23, 2023, and an overview of the State’s Density Bonus Program – a topic raised at the workshop.

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

The goal of this study session is to receive direction from both the City Council and Planning Commission regarding the breadth of standards that should apply to multifamily development in the Town and the general approach staff should pursue in preserving the Town’s unique characteristics.

ANALYSIS
The analysis section of this report outlines seven areas of information for the Planning Commission and City Council related to objective design and development standards. Collectively this information and analysis will inform the discussion among the Commissioners and Council members, providing staff with direction on further refinements.

1. Objective Design Standards
State law defines objective standards as “involving no personal or subjective judgment by a public official” and that are “uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official prior to submittal.” Standards that do not meet the state’s definition are subjective.

Examples of “objective” and “subjective” standards are provided in Table 1. The state encourages, and at times requires, objective standards because they provide clarity and certainty for both developers and reviewers. However, objective design standards can also be a tool for local jurisdictions to apply place-based design when the state requires ministerial and expedited approval of projects.

Table 1: Objective vs. Subjective Standards
Subjective Standard Objective Standard
The proposed building or structure will not negatively
impact neighboring properties with respect to privacy
and view. (Atherton Municipal Code 17.15.040(A))
Subjective:
“Negative impact” is undefined and ambiguous.

Accessory buildings and structures may include
windows and/or skylights, except that no window or
skylight openings that face the side or rear property
line shall be located over nine feet above the ground
level. (Atherton Municipal Code 17.40.040(H))
Objective:

Clear direction on windows and skylights relative to
neighboring property lines.

Pedestrian links should be provided between
buildings, common open spaces, and parking areas.

Subjective:

Should is suggestive, not required
All structures, entries, facilities, amenities, and
parking areas shall be internally connected with
pedestrian pathways.

Objective:

Clear expectation
The accessory building should be harmonious with the
existing main residence.

Subjective:

Use of “should” and “harmonious” are subject to
interpretation by reviewer.

The accessory building must have the same roof
form and materiality as the existing main residence.

Objective:

Clear expectation
Local jurisdictions have a variety of options as to how they can approach the application of objective design standards. This includes familiar standards that include specific counts and measurements that are characteristic of minimum or maximum height or setback requirements, or Page 5 of 267 November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

more complex standards that provide a set of options to choose from or require a proposal to reach a target score for compliance. Specific examples of these applications are provided in Table 2.

Table 2: Types of Objective Standards
Type Examples
Counts and
Measurements Maximum and minimum heights, distances, and/or setbacks Ratios
Roof pitch requirements (Gable roof of 9:2)
Upper story step backs
(Additional 1 foot setback required for each 1 foot in height above a certain amount)
Checklists Checklist of required features
An entryway must incorporate at least four of the following elements… Scorecards
Minimum total of combined scores for eligible design treatment (Proposed landscaping must achieve a score of a least 20 points where shrubs and trees are assigned point values based on plant container size) Performance Measures
and Benchmarks Minimum amount of open space or permeable area provided.

2. Design and Development Standards
Typically, objective design standards supplement a set of existing development standards already included in a zoning ordinance. However, because Atherton does not have an existing multifamily zoning district, the Town must establish baseline development standards in addition to design standards. This section of the report provides a framework for basic design and development concepts that can dictate building massing and site design, such as floor area ratio (FAR), lot coverage, setbacks, parking and height.

Lot Coverage
Lot coverage is the percentage of lot that is covered by development. It is not influenced by the height of a building. As shown in Figure 1, a lot with 75 percent coverage means that the entire lot is covered, a lot with 50 percent coverage means that half of the lot is covered and a lot with 25 percent coverage means that a quarter of the lot is covered. The Town of Atherton does not have lot coverage requirements for the R1-A and R1-B residential zoning districts. This is likely because the town uses floor area ratio requirements and setback standards to guide where development on a lot can occur. However, the POS (Public Open Space) district restricts development to a maximum of 20 percent gross lot area and the PFS (Public Facilities and Schools) district restricts development to a maximum of 40 percent gross lot area.

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

Figure 1: Lot Coverage
Floor Area Ratio (FAR)
Floor area ratio (FAR) is the relationship between the amount of floor area on a property relative to the lot size. FAR is distinct from lot coverage because it can apply to beyond just the ground level of a property. As shown in Figure 2, an FAR of 1 can account for a single-story building that occupies the entire lot (100 percent lot coverage), a two story building that occupies half of the lot (50 percent lot coverage), or a three story building that occupies a third of the lot (33 percent lot coverage).

In R1-A and R1-B zoning districts the Town requires an FAR of 18 percent, with a restriction of

7.5 percent for second stories in the R1-A district. There are no FAR requirements for the POS and PFS districts.

Figure 2: Floor Area Ratio
Setbacks
A setback standard is the minimum distance between two objects, typically where construction can occur relative to a property line. A front setback is the distance from the front property line, a side setback is the distance from a side property line and a rear setback is the distance from a rear property line. As shown in Figure 3, the setbacks combine to identify the buildable area of a lot.

The Town has a minimum 60-foot front and rear setback requirement for the R1-A, POS, and PFS zoning districts. The minimum front and rear setback requirement for an R1-B property is 30 feet.

This is likely attributed to the smaller lot sizes characteristic of lots within the R1-B district.

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

Additionally, sites in the PFS district may require a setback up to 75 feet depending on the height of a structure and adjacency to residential neighbors.

Figure 3: Setbacks and Buildable Area
Building Massing
Building mass is a term that describes the three-dimensional space occupied by a building within the buildable volume that results from the combination of lot coverage, FAR, and setbacks when height is applied. Figure 4 illustrates how standards combine to form a buildable volume and the building mass occupied by a code-compliant building. Note that these two concepts are similar, but not identical. This is because limitations on FAR above the first story, as well as specific objective design standards that relate to upper-level setbacks and roof form can serve to sculpt the building at different levels. Building massing may also inform how multiple buildings on a lot relate to each other or how building forms create distinct spaces on site, such as a courtyard.

The Town has varying height limits by zoning districts. The maximum height limit in R1-A is 30 feet, in R1-B it is 28 feet, and in the POS and PFS districts it is 34 feet.

Figure 4: Buildable Volume and Building Mass
Site Design
Site design refers to the layout of all buildings and uses on a property. This can refer to the orientation and access of a residence and the location of ancillary residential functions such as parking, waste disposal, or amenities. Designation of the appropriate location of these activities can alleviate conflicts between neighbors relative to noise, lighting, and vehicular access. Two examples of simple site design configuration are provided in Figure 5, each which approaches multifamily development within a single building, characteristic of a large single-family residence. Page 8 of 267 November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

The differences in the two site configurations include the number of units, scale of the building mass to accommodate the units and related parking, orientation of the building, and pedestrian access to the street.

Figure 5: Site Configuration and Building Mass
Screening and Walls
A more detailed component of site design is the location of screening (landscape or fencing) and walls. These features are important components of site design because they can provide privacy, buffering of noise, and control for aesthetics.

Façade Articulation
Design elements of visible façades can help soften the appearance of any building mass that is visible from the public right-of-way or adjacent properties. This includes standards relating to roof and eave details, window articulation (including finishes, recesses, embellishments, and materials), and pedestrian entry treatments. Collectively these discrete components can contribute to form an objective requirement that provides a high-level of architectural design.

Parking
The Town does not have standards related to the quantity or location of off-street parking ancillary to residential uses. Therefore, requirements must be incorporated into the proposed objective design and development standards. Typical parking standards may include the location of parking facilities, access from the street, and the number of cars required (minimums or maximums and based on number of units or bedrooms). While below-grade parking facilities may be preferred, excavation could raise development costs and constitute a constraint in housing development.

However, the Town could consider crafting incentives to support this preference.

3. Large House Typology
At the October 23, 2023, Community Workshop, staff combined the concepts above to introduce a “Large House” typology as a potential multifamily housing strategy. The goal of this approach would be to set objective design and development standards to reflect the existing architectural character of Atherton – stately and refined homes. Examples of 6-unit and 12-unit configurations are provided in Figure 5 above and were shown, along with multiple pictures at the Community Workshop. The presentation for the workshop is provided at Attachment 1.

4. Feedback from Community Workshop No. 1
The Town received constructive feedback at the Community Workshop on October 23, 2023, with 24 attendees including one Planning Commissioner and three City Council members. A critical concern of many attendees includes the selection process of multifamily housing sites, both

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

currently included and up for consideration, in the Housing Element. Concerns also relate to the impacts of future development on immediate neighbors. An overview of community feedback is provided below, notes from the workshop are included at Attachment 2.

Development Standards. Multiple attendees indicated a preference that multifamily development should conform to R1-A standards, including setback and height requirements.

Additional comments suggested the Town consider providing flexibility through the application of dormers and/or greater flexibility for basement development, especially to accommodate below grade parking or a need for more storage area. This approach should also take into consideration any development that results from the acquisition of multiple adjacent properties. This feedback generally aligns with staff’s “large home” typology approach discussed in the next section. However, upon further analysis greater flexibility from the R1- A standards may be required to facilitate development.

Design Review Board. A request was made to consider establishing a design review board to process multifamily developments, but not single-family. Staff notes that the direction from the Housing Element is to enable by-right approval of multifamily development, giving minimal discretion to a Design Review Board, especially with the adoption of objective design standards.

Aesthetics. Consistent with the feedback on development standards, multiple attendees desired the perception of the multifamily building from the front to read as a single-family home. This could include limitations on the number of unit entries visible from the front and a solid gate at the property’s entrance.

Privacy, Noise and Screening. Privacy standards were encouraged, including the prohibition of balconies. Noise concerns and the potential need for soundwalls were raised. Staff was asked to consider limitations on resident amenities that cause noise (pools, sport courts, playgrounds).

Attendees also desired requirements for ongoing maintenance of required screening up to 40 years.

Unit Size. A suggestion was raised for a maximum unit size. Staff has concerns that a maximum unit size would constrain development and, instead, suggests a maximum average unit size.

This would give the developer greater flexibility in their housing program but still provide a standard acceptable to the Town.

Heritage Trees. Residents requested that the Heritage Tree Ordinance should be maintained and applied to multifamily sites consistent with R1-A standards.

Traffic and Pedestrian/Bicycle Safety. Attendees raised concerns about traffic with the complexities and dangers of the 5-way stop and traffic at Ringwood and Bay Road mentioned many times. Staff was encouraged to coordinate with the City of Menlo Park. Residents were open to the idea of a traffic mitigation impact fee.

Parking. Suggestions were made to locate parking below grade and to provide a minimum of two spaces per unit, enclosed. As mentioned above, staff has concerns that locating parking solely below grade could constitute a development constraint and would suggest requiring enclosure of all parking, with incentives for locating parking below grade.

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

Density. Two concerns led to group discussions regarding density. One concern was that the Town could revert to a 20 dwelling unit/acre (du/ac) density and not inform the public. Staff affirmed that the public would receive notice if the Council were to consider an increase from 10 du/ac and indicated that this could be a possibility if HCD rejects the 10 du/ac program.

The second concern related to the density bonus program and its application to the standards.

In response to this concern, staff committed to elaborating on the program for this study session and has provided an overview in this report. This concern was also raised by Commissioner Bryant at the October 25, 2023, Planning Commission meeting during the Commissioner Reports section of the agenda.

5. Density Bonus Law
The Density Bonus Law is a state law that applies to all jurisdictions and encourages developers to construct affordable housing by providing added density, concessions, and incentives for eligible projects. It is a complex program because the specific amount of density that a developer can apply to their project as a bonus varies depending on the multiple project criteria: the percentage of units that are affordable, the level of that affordability (i.e. very low, low, moderate), and if the project serves specific target populations (foster youth, disabled veterans, homeless, or seniors). There is also a bonus for projects that provide a child-care facility on-site.

In March 2022 the Council received a memo on the state’s requirements that included the “Guide to the California Density Bonus Law” (Attachment 3). Together these documents provide an excellent and in-depth explanation of how the density calculations are determined and provide a useful baseline scenario for consideration. While there have been some legislative updates to the program since 2022, these changes do not change the methodology outlined in the Memo, its attachment, or the description in this report. This is a mandatory program requirement for all local jurisdictions, the precise language can be found in California Government Code Sections 65915- 65918.

While the Memo is useful in outlining how the Density Bonus program could apply to the Town, it assumes that the Town will adopt an inclusionary housing ordinance that will require 20 percent of development to accommodate moderate-income units. However, the adopted Housing Element indicates that the Town will adopt a minimum inclusionary housing requirement of 20 percent, with income requirements for lower income households. (Attachment 4, Housing Element Program 3.811(C), pgs. 123-125) This baseline requirement of 20 percent lower income affordability would automatically make a project eligible for the State's Density Bonus program and allow the project to include an additional 25 to 50 percent density bonus, depending on the number of units provided at the low- and very low-income categories. (Standards for eligibility are summarized on page 3 of the Guide to the California Density Bonus Law.) For example, a 1-acre site with a density of 10 du/ac and a 20 percent inclusionary requirement at low-income levels, could develop up to 13 units on the site by meeting the Density Bonus Law requirements and receiving a 25 percent bonus with the ability to seek two exceptions from development standards. If the developer met the inclusionary requirement with 15 percent very low-income and 5 percent low-income, the project would receive a bonus of 50 percent enabling development up to 15 units and the ability to seek three exceptions from development standards.

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

If the Town were to adopt an Inclusionary Housing program that required housing for moderateincome households, then the example provided above would result in a 15 percent bonus (12 units) and the ability to seek two exceptions.

Regardless of the Town’s inclusionary program, the largest density bonus and concession/incentive package would apply in a scenario with a 100% affordable housing development, were a minimum of 80 percent of the units are available to low and very-low income households and no more than 20 percent are available to moderate income. In this scenario a developer could receive an 80 percent density bonus, increasing a 1-acre 10-unit low-income project to 18 units and receiving up to 4 exceptions from development standards. However, if the site is located within 0.5-mile of public transit, the density bonus would be “no density” and the project would be able to build an additional 3 stories (33-feet) above the required height limit.

6. Sites and Standards Identified in the Adopted Housing Element The adopted 2023-31 Housing Element (Attachment 4) currently includes two programs to develop multifamily housing at sites identified in Table 3. The Housing Element also provides direction for future development review standards:

Program 3.811(C): New Multifamily Housing Development
Directs the Town to create “a multifamily overlay zoning district, RM 10, permitting multifamily housing development at densities of 10 dwelling units per acre with heights up to 40 feet and adequate setbacks to accommodate the maximum density. Multifamily housing will be allowed by right, provided that each project is consistent with adopted objective design standards. One single family property (has) been identified for rezoning to multifamily (23 Oakwood).” (Housing Element, pgs. 123-124) Additional standards identified in the Housing Element for the RM-10 overlay district include amending the Zoning ordinance to allow “up to a 40 (foot) height limit and setbacks reasonable to accommodate the new development.” (Housing Element, pg. 125) Program 3.813: Multifamily Housing Development on School Properties “The Town will amend the PFS (Public Facilities and School) zoning district to permit new multifamily housing by right at 40 units and 20 units per acre at four locations on the private school properties subject to objective design standards. The Town will complete the CEQA analysis and adopt the Zoning amendment within one year of Housing Element certification. (Housing Element, pg. 130)
The Housing Element also provides some additional guidance for development standards for the school sites including amending the height limit to allow four (4) stories at 48 feet, reducing the minimum front setback requirement to 30 feet (specifying on applicable to Valparaiso for Menlo School), and acknowledging the eligibility of Menlo College for parking reductions through state law. The Housing Element also suggests that parking at the site on the Menlo College O’Brien lot may be replaced to meet the needs of the college and could be provided at the ground level of a podium building or below grade. Additionally, development on the Menlo College parking lot near the Administration Building could accommodate additional parking near the entry to the College off of El Camino real. (Housing Element, pgs. 69-72)

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

Table 3: Multifamily Sites in Adopted Housing Element
Address Existing Zoning Proposed
Zoning Overlay
Proposed Net Residential
Units from Zoning Overlay
23 Oakwood
(1.6 acre) R-1A RM-10 16
Menlo College
(O’Brien Lot) PFS RM-40 60
Menlo College
(WWII Housing) PFS RM-20 30 (net 26)
Menlo College
(near Admin Bldg) PFS RM-40 40
Menlo School
(SW parking lot) PFS RM-20 25
Menlo School
(SE parking lot) PFS RM-20 20
Sacred Heart
(Reconstruct
Housing)
PFS RM-20 20 (reconstructed)

7. Potential Sites for Inclusion in the Housing Element At meetings held on July 19, 2023, and September 20, 2023, the City Council considered and included 10 additional privately-owned sites listed in Table 4 for multifamily development in the ongoing analysis under the California Environmental Quality Act (CEQA). Although these additional sites are not officially incorporated into Atherton’s Housing Element, they are included in this report, as they may be added in the future.

Table 4: Potential Multifamily Sites on Privately Owned Lots **These sites are not in the adopted Housing Element and are under evaluation** Address Lot Acres Existing Zoning Proposed
Zoning Overlay
Proposed Net Residential
Units from Zoning Overlay
999 Ringwood Ave. 0.90 R-1A RM-10 9
352 Bay Rd. 0.92 R-1A RM-10 9
318 Bay Rd. 0.94 R-1A RM-10 9
296 Bay Rd. 0.93 R-1A RM-10 9
175 Ravenswood 1.1 R-1A RM-10 11
185 Ravenswood 1.1 R-1A RM-10 11
197 Ravenswood 1 R-1A RM-10 10
Gilmore House 0.9 of infill area POS RM-10 9
Circus Club Approx.

0.5 of infill area POS RM-10 5
CalWater Approx.

0.25 of infill area POS RM-10 3

DISCUSSION

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

Staff has included a list of questions to facilitate discussion among the Commission and Council Members. These questions reflect feedback sought by staff to help inform the crafting of actual standards specific to the Town for further public feedback.

1. Is there additional feedback regarding any specific standard? This could relate to exact language for controls or preferences for how a standard might be applied (i.e., a list vs. scorecard for front entry treatments).

2. Are there additional standards that staff should include that have not been identified?

3. Is there support for the direction of the “large home” approach for guiding building mass?

4. To what extent should the RM-10 standards identified in the Housing Element provide direction to staff?

5. Should the PFS standards identified in the Housing Element provide direction to staff and should the “large home” typology guide building massing and site design for these properties?

6. Council has previously discussed that multifamily development at POS should preserve existing open space and function as infill development. Should the “large home” typology guide building massing and site design for these properties?

NEXT STEPS
Following this study session, staff will look at the feasibility of the direction and craft a recommended approach for objective design and development standards. Staff will then introduce initial concepts and draft standards at a Community Workshop on November 13, 2023. Following this workshop, staff will determine the next steps for further refinement or adoption, pending the CEQA review for the Housing Element. As required by state law, the Town must adopt standards by January 31, 2024.

In addition to the objective design and development standard process outlined above, staff will facilitate a Housing Element Question and Answer Town Hall forum on November 8, 2023. This will provide an opportunity for community members to participate in a dialogue with staff regarding certain requirements and decisions relating to the Housing Element. This meeting will occur virtually.

FISCAL IMPACT
The overall fiscal impact to the General Fund would be $159,553 to complete Objective Design Standards and $118,553 to complete Zoning Code modifications. Funds are incorporated as part of the Town’s FY 2023-24 Budget
CEQA

November 1, 2023, Planning Commission/City Council Staff Report Multifamily Housing Objective Design and Development Standards Study Session

This Study Session is statutorily exempt from CEQA under Section 15262, Feasibility and Planning Studies.

NOTICE
Public notification was achieved by posting the agenda, with this agenda item being listed, at least 72 hours prior to the meeting in print and electronically. Information about the project is also disseminated via the Town’s electronic News Flash and Atherton Online. There are approximately 1,200 subscribers to the Town’s electronic News Flash publications. Subscribers include residents as well as stakeholders – to include, but be not limited to, media outlets, school districts, Menlo Park Fire District, service provides (water, power, and sewer), and regional elected officials.

CONCLUSION
Staff requests that the City Council along with the Planning Commission discuss policy issues for objective design and development standards and to provide direction to staff.

ATTACHMENTS

1. Community Workshop #1 Presentation Slides

2. Summary of Comments received at Community Workshop #1

3. 2022 Staff Memo and Guide to California Density Bonus Law

4. Adopted 2023-2031 Housing Element

Objective Design Standards
for Multi-Family Housing
Community Workshop
Town of Atherton
October 23, 2023

AGENDA
2 ▪ Workshop Overview
▪ Purpose of Objective Standards
▪ Regulatory Tools
▪ Design Issues for Discussion
▪ Community Identified Issues
▪ Next Steps

PURPOSE OF OBJECTIVE STANDARDS
3

4 PURPOSE OF OBJECTIVE DESIGN STANDARDS
Facilitate streamlined and ministerial review
process for residential development and:
▪ Comply with recent State legislation
▪ Achieve intent of existing policies
▪ Preserve community character
▪ Provide objective criteria
▪ Provide certainty to developers

5 CALIFORNIA STATE LEGISLATION
SB 35
Requires approval of
qualified housing
projects based on
objective regulatory
standards
SB 330 Housing
Crisis Act
Prohibits imposing
or enforcing new
design standards
established on or
after January 1,
2020, that are not
objective
SB 167 Housing
Accountability Act
Local government
may not deny,
reduce density, or
make infeasible
housing projects
consistent with
objective design
standards

WHAT ARE

OBJECTIVE
DESIGN
STANDARDS?
“standards that involve no personal or
subjective judgement by a public
official and are uniformly verifiable by
reference to an external and uniform
benchmark or criterion available and
knowable by both the development
applicant or proponent and the public
official prior to submittal.”
(California Government Code, Section
65913.4)
6

OBJECTIVE STANDARDS
7 ▪ Objective standards are a
powerful toolkit that allow
communities to respond to
State housing laws that are
reducing local control over
development
▪ Provide an opportunity to
ensure that the appearance
of new development is
compatible with the Town’s
vision
State
Legislation Local Control
Objective
Design
Standards

DESIGN GUIDELINES VS. OBJECTIVE STANDARDS
Design Guidelines
▪ Subjective
▪ Recommendations (not
enforceable)
▪ Unmeasurable and difficult
to interpret
8 Objective Standards
▪ Supplement Design
Guidelines
▪ Streamlined Review
▪ Measurable, quantifiable,
easily defined, and
enforceable
no personal or
subjective judgment
negotiation and
compromise

9 Ministerial Review
▪ Streamlined review by
jurisdiction
▪ Removes personal or
subjective judgement
▪ Consistency with objective
design standards is
primary tool for project
review
Discretionary Review
▪ Project undergoes design
review
▪ Qualitative judgement and
review by jurisdiction staff
and reviewing bodies
▪ Reviewing bodies determine
the project’s compliance
with design guidelines
no personal or
subjective judgment
negotiation and
compromise
DISCRETIONARY VS. MINISTERIAL REVIEW

DESIGN GUIDELINES VS. OBJECTIVE STANDARDS
“Pedestrian links should be
provided between buildings,
common open spaces, and
parking areas”
10 SUBJECTIVE

OBJECTIVE
Town of Los Gatos
North 40 Specific Plan

DESIGN GUIDELINES VS. OBJECTIVE STANDARDS
All structures, entries, facilities,
amenities, and parking areas shall be
internally connected with pedestrian
pathways.
11 Potential Objective Standard to Address Subjective Guidance

SUBJECTIVE

OBJECTIVE
Internally connected pedestrian paths
Source: https://www.elevatetosequoia.com/apartments/ca/antioch/cross-pointeapartment-homes/

12 Counts and
Measurements
▪ Height
▪ Distances
▪ Setbacks Ratios
▪ Roof Pitch
▪ Step Back Ratio
Checklists
Checklist of required
architectural features
Scorecards
Minimum total of
combined scores for
eligible design
treatment
Performance
Measures and
Benchmarks
Minimum amount of
open space provided

TOOLS FOR OBJECTIVE STANDARDS

REGULATORY TOOLS
13

IDENTIFIED HOUSING ELEMENT SITES
14

Existing
Zoning District
Housing Element
Sites
Proposed
Zoning Overlay
Proposed
Density
R-1A 999 Ringwood Avenue
352 Bay Road
318 Bay Road
296 Bay Road
175 Ravenswood Avenue
185 Ravenswood Avenue
197 Ravenswood Avenue
23 Oakwood Boulevard
R-10 10 Dwelling Units/Acre
POS Gilmore House (Holbrook Park Palmer)
Circus Club
CalWater
R-10 10 Dwelling Units/Acre
PFS Menlo College Sites
Menlo School Sites
Sacred Heart Site
R-20, R-40 (Menlo College
O’Brien Lot and site near
Admin Building)
20 Dwelling Units/Acre
(R-20), 40 Dwelling
Units/Acre (R-40)
15 SITE INFORMATION

16 PARCEL

17 1.0 – 1-story

FLOOR AREA RATIO (FAR)

18 1.0 – 2-story

FLOOR AREA RATIO (FAR)

19 1.0 – 3-story

FLOOR AREA RATIO (FAR)

20 LOT COVERAGE
75%

21 LOT COVERAGE
50%

22 25%

LOT COVERAGE

23 SETBACKS

DESIGN ISSUES FOR DISCUSSION
24

25 LARGE HOUSE TYPOLOGIES

Existing
Zoning District
Housing Element
Sites
Proposed
Zoning Overlay
Proposed
Density
R-1A 999 Ringwood Avenue
352 Bay Road
318 Bay Road
296 Bay Road
175 Ravenswood Avenue
185 Ravenswood Avenue
197 Ravenswood Avenue
23 Oakwood Boulevard
R-10 10 Dwelling Units/Acre
POS Gilmore House (Holbrook Park Palmer)
Circus Club
CalWater
R-10 10 Dwelling Units/Acre
PFS Menlo College Sites
Menlo School Sites
Sacred Heart Site
R-20, R-40 (Menlo College
O’Brien Lot and site near
Admin Building)
20 Dwelling Units/Acre
(R-20), 40 Dwelling
Units/Acre (R-40)
26 SITE INFORMATION

27 “Big House” Prototype
(12-plex/1 building)
14,000 sq ft parcel

LARGE HOUSE TYPOLOGIES

28 LARGE HOUSE TYPOLOGIES
“Big House” Prototype
(12-plex/1 building)
Typical 1-acre parcel

29 LARGE HOUSE TYPOLOGIES
“Big House” Prototype
(6-plex Courtyard building)
12,000 sq ft parcel

30 LARGE HOUSE TYPOLOGIES
“Big House” Prototype
(6-plex Courtyard building)
Typical 1-acre parcel

DESIGN ISSUES

FOR OBJECTIVE

STANDARDS

DISCUSSION
31 ▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking
▪ Other Issues

32 GOAL
What is your desired outcome?

COMMENT
how to potentially
achieve that goal
▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking
▪ Other Issues

COMMUNITY COMMENTS

SETBACKS AND HEIGHT
33

34 Typical 1-Acre Atherton Parcel

SETBACKS AND HEIGHT

35 Single-Family Setbacks
Front and Rear: 60 feet
Side(s): 50 feet
Buildable area: 10,000 sf

SETBACKS AND HEIGHT

36 Single-Family Maximum Height
Main Building: 30 feet
Vertical Sidewalls: 22 feet

SETBACKS AND HEIGHT

37 SETBACKS AND HEIGHT
Development Potential
3,000 sf footprint (lot coverage)
6,000 sf home (13.7% FAR)

SITE COVERAGE
38 Single Family Home
in Atherton
Fourplex Surrounded by
Single Family Homes

SITE COVERAGE
39 Single Family Home
in Atherton
Fourplex Surrounded by
Single Family Homes

40 Single Family FAR
Total Building: 18% Max. FAR

FLOOR AREA RATIO

41 Single Family FAR
Upper Floor(s): 7.5% Max. FAR
Total Building: 18% Max. FAR

FLOOR AREA RATIO

42 Lot Coverage
(using prescribed setbacks)

22.7%

SITE COVERAGE

43 Lot Coverage
(Implication)
40%

SITE COVERAGE

44 GOAL
What is your desired outcome?

COMMENT
how to potentially
achieve that goal
▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking

COMMUNITY COMMENTS

BUILDING MASSING
45 FLOOR AREA RATIO Page 60 of 267

BUILDING MASSING
46 UPPER FLOOR SETBACKS Page 61 of 267

BUILDING MASSING
47 PRIVACY FROM UPPER-LEVEL DEVELOPMENT Page 62 of 267

BUILDING MASSING
48 COURTYARDS (SHARED OPEN SPACE) Page 63 of 267

SITE DESIGN
49 ENTRY GATES/ACCESS TO THE STREET Page 64 of 267

SITE DESIGN
50 PEDESTRIAN ACCESS TO THE STREET Page 65 of 267

SITE DESIGN
51 SHARED AMENITIES (POOLS, SPORTS COURTS, SPAS) Page 66 of 267

SITE DESIGN
52 SITE LIGHTING Page 67 of 267

SITE DESIGN
53 REFUSE/RECYCLING FACILITIES Page 68 of 267

SCREENING AND WALLS
54 FENCES AND WALLS Page 69 of 267

SCREENING AND WALLS
55 LANDSCAPING SCREENING AND BUFFERING Page 70 of 267
56 GOAL
What is your desired outcome?

COMMENT
how to potentially
achieve that goal
▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking

COMMUNITY COMMENTS

FAÇADE ARTICULATION
57 ROOF AND EAVE DETAILS Page 72 of 267
FAÇADE ARTICULATION
58 WINDOW ARTICULATION Page 73 of 267
FAÇADE ARTICULATION
59 PORCH AND ENTRY DETAILS Page 74 of 267

PARKING
60 PARKING LOCATION Page 75 of 267

PARKING
61 INTEGRATION OF STRUCTURED PARKING Page 76 of 267
62 GOAL
What is your desired outcome?

COMMENT
how to potentially
achieve that goal
▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking

COMMUNITY COMMENTS

COMMUNITY IDENTIFIED ISSUES
63

64 GOAL
What is your desired outcome?

COMMENT
how to potentially
achieve that goal
▪ Setbacks and Height
▪ Site Coverage
▪ Building Massing
▪ Site Design
▪ Screening and Walls
▪ Façade Articulation
▪ Parking
▪ What have we missed?

COMMUNITY COMMENTS

NEXT STEPS
65

▪ Joint Study Session – November 1st

▪ Workshop #2 – November 13th
▪ Planning Commission Meeting
▪ City Council Hearing

NEXT STEPS

Objective Design Standards
for Multi-Family Housing
Community Workshop
Town of Atherton
October 23, 2023

COMMUNITY WORKSHOP #1: Feedback Notes
ODS Discussion (What is your desired goal and how to potentially achieve that goal) • Setbacks and Height / Site coverage
o Speaker 1 –
▪ Requested information on objective criteria for site selection. • Staff asserted that the site selection has been an ongoing discussion topic at Council for approx. 2 years and the focus of the workshop is to identify standards, not reconsider sites. o Speaker 2 (97 Frederick Ave) –
▪ Setbacks at 60 feet is a priority. Privacy and quality of land use are important.
▪ Neighborhoods will be impacted with 10 du/ac density. Such a “Capricious” selection of properties will ruin neighborhoods. o Speaker 3 (Tom Jorgey, 425 East Oakwood Blvd, RWC) –
▪ Provided rendering of multifamily development at 20’ from their property line to show what is not wanted.
▪ Preserve existing standards of Atherton. This is “dropping bombs in our neighborhood.”
o Speaker 4 (Jeff Morris, 55 Elena) –
▪ 60+ year residents care about the character of Atherton. R-1A setbacks should be the same.
▪ Question: How does state density bonus laws work? What’s the max that can be built in Atherton?
▪ Nothing should exceed 2 stories.
▪ Objective privacy standards should be developed.
▪ There should be max unit size.
o Speaker 5 (Greta, 74 Laburnum) –
▪ Consider tree canopy, size and glory of trees. Preserve Atherton’s uniqueness.
o Speaker 6 (Carol) –
▪ Preserve the character and aesthetics of single-family homes. ▪ 10 du/ac would require basement development.
• Staff asked if concerned about setbacks for basements. ▪ Multifamily homes should look like single-family homes with 7,000 sf above ground and 3000 sf underground.
▪ Height restrictions should be the same.
▪ Dormers should be limited but could be used.
▪ Explains that FAR won’t allow for MFH.
o Speaker 7 (319 Bay Rd, MP) –
▪ Concerned about neighborhood and quality of life. Happy with existing development in the neighborhood but concerned about traffic. o Speaker 8 (Elizabeth Jensen, 30 Frederick Ave) –
▪ Concerned about 4 units at a 5-way stop (Ringwood and Bay Road) sites.

COMMUNITY WORKSHOP #1: Feedback Notes
▪ Concerned about design for 10 du/ac. What happens if we come back and do 20 du/ac?
• Staff explained that Council has directed 10 du/ac at private sites, but could be an iterative process pending HCD review. Changes to density would result in additional outreach and involvement. o Speaker 9 (Dave Reeney, 224 Oak Grove) –
▪ Is there a practical constraint that would require changing the front and rear setbacks? Keep setbacks in line with R-1A setbacks. o Speaker 10 (Frederick Ave) –
▪ What are people willing to sacrifice for setbacks? Questions for the public. Attendees respond that they want the exact same setbacks as R1A. • Building Massing / Site design / Screening and Walls
o Speaker 1 (Tom Jorgey, 425 East Oakwood Blvd, RWC) –
▪ Who Maintains these features? Thinks developer should maintain for the next 30-40 years.
▪ Masonry fencing for durability.
▪ Easement could be beneficial to help maintain fence.
▪ Screening should screen for complete privacy of single-family lots.

Developers should maintain screening. This should be ODS that is not an option to get out of.
▪ 23 Oakwood Specific – How can we have ODS that give deference to the character of neighboring properties?
• Staff suggested massing could respond to neighboring context (i.e. smaller building formers when properties abut neighbors in other jurisdictions that have a smaller building character). o Speaker 2 () –
▪ Concerned about privacy. Wants soundwall. Concrete soundwall at 10-12 feet high.
▪ High concrete wall maintained by developer.
▪ Multifamily will disrupt community tranquility.
▪ Traffic on Bay Rd and Ringwood is impossible and there’s not enough parking. Where are 10+ cars going to park and how are they going to come and go?
▪ Individual trash cans per units creates about 80ft is length for trash cans.

Concerned about this as an eye-sore and odor.
o Speaker 3 (Elizabeth Jensen) –
▪ Concerned that a developer could buy multiple lots and build apartment like buildings. Requested staff to consider this possibility when developing ODS.
o Speaker 4 () –
▪ Have you seen a town or city being able to avoid housing element regulations?

COMMUNITY WORKSHOP #1: Feedback Notes
• Staff indicated no, and mentioned recent settlement between the City of Coronado and the State, with Coronado required to comply.
o Speaker 5 (Jeff Morris) –
▪ Building mass – Max unit size and buildings should be 2-story max with no exceptions.
▪ FAR should be a little higher, but not much more, than SFH. ▪ Reiterated Density Bonus concern and suggested reducing density to 6 du/ac. 10 du/ac is too high.
o Speaker 5 (Rick DeGolia, 84 Play Dr) –
▪ Concerned about adverse impact on privacy.
▪ Massing – Is there a way to structure ODS, where lots are re-zoned to MFH…could we say that a couple of the lots could be developed for MFH?
• Staff explained this is a legal question and not likely possible. ▪ Concern about buying multiple lots and concern about façade running across all.
• Staff explained that ODS could prevent that.
o Speaker 6 (Carol) –
▪ Courtyard design should have protection/screening at the entrance to look like a single-family home.
▪ Limit the number of entrances seen from the front.
▪ Wants privacy from neighbors – No balconies. Doesn’t want to see trash or storage on places like balconies.
▪ Factor in a turning radius for garage access.
▪ There should be no pools or sport courts. Doesn’t want 40 ppl in the back during a holiday weekend making a lot of noise.
▪ No Playground equipment
▪ Need property management – Who’s going to manage it? Who’s making sure rules and privacy are respected.
▪ Need solid gate (at front).
▪ Wants design review for multifamily, but not single family. ▪ Need underground parking. 10 units has potential for 20+ cars and pseudo-commercial trucks.
▪ Underground storage for multifamily homes.
• Façade Articulation and Parking
o Speaker 1 (Elizabeth, 111 Frederick Ave) –
▪ Unrealistic to have one parking spot per unit. At least 2 spots per unit and self-contained within those units.
▪ Traffic down Ringwood needs to be thought about. It’s a disaster and is only going to get worse.
▪ Town needs to work with Menlo Park on the traffic issue. o Speaker 2 (City Manager, George Rodericks) –

COMMUNITY WORKSHOP #1: Feedback Notes
▪ Prefer to see residential garage and entry style, with gate at entrance to garage rather than an open entry.
o Speaker 3 (Carol) –
▪ Underground parking is typically on the side of the property. ▪ If there is a gate at the property entrance, another gate at underground parking is not necessary.
▪ Decibel limits and sound restrictions on underground parking o Speaker 4 () –
▪ Site criteria should be fair and consider properties that haven’t been redeveloped. Some places make sense – El Camino Real. ▪ Focus on MFH on ECR to match other jurisdictions.
▪ Lives on Bay Rd and doesn’t feel safe walking. Neighbors have asked to walk through his property because of safety concerns.
o Speaker 5 (Lin H., 29 Frederik Ave) –
▪ 5
th home on Bay Rd backs up onto her property.
▪ People feel uncomfortable walking down Bay Rd around Lindenwood.

Neighbors created safer access through a shared gate.
▪ Concerned about traffic on Frederick Street in Lindenwood. ▪ Multifamily housing is going to make traffic worse, and people won’t enjoy living in Atherton anymore and will move.
• Other Issues
o Speaker 1 (Tom) –
▪ Parking Standards
▪ Traffic signals should be added at Selby. Should be on developer to provide.
▪ Drainage concerns at 437 E Oakwood and other areas in Oakwood Blvd. ▪ Could developers be forced to contribute financially? • Staff mentioned traffic mitigation impact fee. Attendees vocalized support.
o Speaker 2 () –
▪ Communicate why lots were chosen.
o Speaker 3 (Planning Commissioner, Chair Lane ) –
▪ Describes and asks staff questions about threat of Builders Remedy ▪ Urges the we need for a plan, given Builders Remedy, and that a plan creates outline for procedure and control of development standards for multifamily, which otherwise would not apply in a Builders Remedy scenario.

STAFF MEMO
TO: HONORABLE MAYOR AND CITY COUNCIL
THROUGH: GEORGE RODERICKS, CITY MANAGER
FROM: LISA COSTA SANDERS, TOWN PLANNER
DATE: MAY 23, 2022
SUBJECT: HOUSING ELEMENT UPDATE – BACKGROUND INFORMATION The City Council, at its May 18, 2022 meeting, discussed potential sites to include in a new multi-family overlay zone, density options, zoning provisions and application of the State Density Bonus Law. This memo provides additional information following up on that discussion.

Density Bonus Law: (see page 5 in the link below). The link provides a very good summary and overview of how Density Bonus Law operates.
https://www.meyersnave.com/wp-content/uploads/California-Density-Bonus-Law_2021.pdf The Council has provided direction to staff to develop a new multi-family overlay zoning district and include several sites in the initial rezoning effort with the Housing Element update process.

The State Department of Housing and Community Development (HCD) has not approved Housing Elements that do not include some provision of multi-family housing.

Together with the multi-family zoning district, the Town has retained a fiscal consultant to prepare an analysis for the Town’s Inclusionary Ordinance that would require developers of multi-family housing to provide a certain percentage of the units as affordable. The first draft of this analysis will be completed the end of May. Staff anticipates requiring 20% of the newly developed units be restricted to moderate income (120% of median income). These affordable units will be deed restricted for a period of 45 years if ownership units and 55 years if rental units.

With the provision of affordable housing, developers are eligible for a State Density Bonus for additional units as well as waivers and concessions to ensure the housing can be built. The memo prepared by Meyers Nave (linked above) provides a good summary of the State Density Bonus Law.

As an example, on a 1.6-acre site with a 10 unit per acre density, the base density would allow 16 units on-site. The Town’s anticipated Inclusionary Ordinance would require the developer to provide 3 moderate income units. In return, the developer would be entitled to 2 density bonus

Housing Element Staff Memo
May 23, 2022

units (15% bonus by providing 20% of the units at moderate income). This would allow them to build a total of 18 units on the site. If the 3 moderate income units contain 3 bedrooms, it would be limited to a household with no more than $179,500 annual income and the rent or sales price would be limited to 30% of their income. Moderate income is defined as 120% of the State Median Income (120% x $149,600).

The developer also has the option to provide the units to lower income households at lower cost.

For example, if the developer chose to restrict the 3 units to low-income households, the developer would be entitled to a 35% density bonus, resulting in 6 additional units, bringing the total unit count to 22 units (law provides for rounding up). The maximum household income for a 3-bedroom unit at low income is $146,350. Again, sales or rental price limited to 30% of income. At very-low income, the developer would be entitled to a 50% density bonus, adding 8 additional units (24 total units) and maximum very low income at $91,350.

The size of the household is based on the number of bedrooms in the unit. Family size is number of bedrooms plus one. A studio unit would be calculated at the one-person income level, a onebedroom unit at the two-person income level, etc. The incomes are required to be verified and if rented, the developer is required to certify the rents on an annual basis. If the units are owned, the units would be deed restricted for a period of 45 years. If the unit were sold during the 45- year period, it would be required to be sold to a household with the appropriate income at a calculated affordable rate.

San Mateo County income categories apply to Atherton (amounts for 2022 have not been published):

Housing Element Staff Memo
May 23, 2022

Source:
https://www.smcgov.org/media/30286/download?inline=
2021 San Mateo County Income Limits
For HUD-funded programs, use the Federal Income
Schedule. For State or locally-funded programs, you may use the State Income Schedule. For programs funded with both federal and state funds, use the more stringent
income levels.
www.smcgov.org

Housing Element Staff Memo
May 23, 2022

• Dorm units quality for Density Bonus provisions, but do not count as housing units per State Guidelines.

REVISED JANUARY 2021
Guide to the California Density Bonus Law

BY JON GOETZ AND TOM SAKAI

Table of Contents
INTRODUCTION AND OVERVIEW........................................................................................................

HOW THE DENSITY BONUS WORKS...................................................................................................

DENSITY BONUS CHART...........................................................................................................

HOW THE DENSITY BONUS CAN HELP IN A FRIENDLY JURISDICTION.......................................

HOW THE DENSITY BONUS CAN HELP IN A HOSTILE JURISDICTION..........................................

CEQA ISSUES IN DENSITY BONUS PROJECTS.................................................................................

USING THE DENSITY BONUS TO SATISFY INCLUSIONARY HOUSING REQUIREMENTS............

DENSITY BONUS AND REPLACEMENT HOUSING...........................................................................

DENSITY BONUS IN THE COASTAL ZONE........................................................................................

DENSITY BONUS - A FLEXIBLE TOOL...............................................................................................

DENSITY BONUS STATUTES..............................................................................................................

MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 1

JON GOETZ
E-mail: [email protected]
Direct: 800.464.3559
Jon Goetz is an attorney at Meyers Nave. He has over 30 years of experience in real estate, land use, environmental, redevelopment, housing and municipal law. Jon represents private and public entities in complex real estate development transactions, land use planning, public-private development, infrastructure financing and affordable housing. He has advised on acquiring, financing, leasing and disposing of all forms of improved and unimproved property.

ABOUT THE AUTHORS

TOM SAKAI
E-mail: [email protected]
Direct: 949.833.2599
Tom Sakai is the Principal of Springbrook Realty Advisors, Inc., a real estate consulting practice located in Newport Beach. His practice specializes in consulting to land developers and homebuilders, focusing on pro formas and feasibilities for master-planned communities, school negotiations, assessment district and Mello-Roos financing, affordable housing issues, and other services to the real estate industry.
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Introduction and Overview
Savvy housing developers are taking advantage of California’s Density Bonus Law, a mechanism which allows them to obtain more favorable local development requirements in exchange for offering to build or donate land for affordable or senior units. The Density Bonus Law (found in California Government Code Sections 65915 – 65918) provides developers with powerful tools to encourage the development of affordable and senior housing, including up to a 50% increase in project densities for most projects, depending on the amount of affordable housing provided, and an 80% increase in density for projects which are completely affordable. The Density Bonus Law is about more than the density bonus itself, however. It is actually a larger package of incentives intended to help make the development of affordable and senior housing economically feasible. Other tools include reduced parking requirements, and incentives and concessions such as reduced setback and minimum square footage requirements. Often these other tools are even more helpful to project economics than the density bonus itself, particularly the special parking benefits. Sometimes these incentives are sufficient to make the project pencil out, but for other projects financial assistance is necessary to make the project feasible.

In determining whether a development project would benefit from becoming a density bonus project, developers also need to be aware that:
• The Density Bonus is a state mandate. A developer who meets the requirements of the state law is entitled to receive the density bonus and other benefits as a matter of right. As with any state mandate, some local governments will resist complying with the state requirement. But many local governments favor the density bonus as a helpful tool to cut through their own land use requirements and local political issues.
• Use of a density bonus may be particularly helpful in those jurisdictions that impose inclusionary housing requirements for new developments.
• Special development bonuses are available for developers of commercial projects who partner with affordable housing developers to provide onsite or offsite affordable housing. Special bonuses are also available for condominium conversion projects and projects that include childcare facilities. • The Legislature has recently added density bonuses for housing developments for foster youth, disabled veterans, homeless persons and college students.
2 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021

How the Density Bonus Works

PROJECTS ENTITLED TO A DENSITY BONUS
Cities and counties are required to grant a density bonus and other incentives or concessions to housing projects which contain one of the following:
• At least 5% of the housing units are restricted to very low income residents. • At least 10% of the housing units are restricted to lower income residents. • At least 10% of the housing units in a for-sale common interest development are restricted to moderate income residents.
• 100% of the housing units (other than manager’s units) are restricted to very low, lower and moderate income residents (with a maximum of 20% moderate).
• At least 10% of the housing units are for transitional foster youth, disabled veterans or homeless persons, with rents restricted at the very low income level. • At least 20% of the housing units are for low income college students in housing dedicated for full-time students at accredited colleges.
• The project donates at least one acre of land to the city or county for very low income units, and the land has the appropriate general plan designation, zoning, permits and approvals, and access to public facilities needed for such housing.
• The project is a senior citizen housing development (no affordable units required). • The project is a mobilehome park age-restricted to senior citizens (no affordable units required).

DENSITY BONUS AMOUNT
The amount of the density bonus is set on a sliding scale, based upon the percentage of affordable units at each income level, as shown in the chart on the following page. (Note that maximum density bonus amounts for very low, lower and moderate income housing were increased by legislation approved in 2020.) MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 3

DENSITY BONUS CHART*
*All density bonus calculations resulting in fractions are rounded up to the next whole number. **Affordable unit percentage is calculated excluding units added by a density bonus. ***Moderate income density bonus applies to for sale units, not to rental units. ****No affordable units are required for senior units.
***** Applies when 100% of the total units (other than manager’s units) are restricted to very low, lower and moderate income (maximum 20% moderate). 4 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 5% 20% - - - 20% - -
6% 22.5% - - - 20% - -
7% 25% - - - 20% - -
8% 27.5% - - - 20% - -
9% 30% - - - 20% - -
10% 32.5% 20% 5% 15% 20% 20% -
11% 35% 21.5% 6% 16% 20% 20% -
12% 38.75% 23% 7% 17% 20% 20% -
13% 42.5% 24.5% 8% 18% 20% 20% -
14% 46.25% 26% 9% 19% 20% 20% -
15% 50% 27.5% 10% 20% 20% 20% -
16% 50% 29% 11% 21% 20% 20% -
17% 50% 30.5% 12% 22% 20% 20% -
18% 50% 32% 13% 23% 20% 20% -
19% 50% 33.5% 14% 24% 20% 20% -
20% 50% 35% 15% 25% 20% 20% 35%
21% 50% 38.75% 16% 26% 20% 20% 35%
22% 50% 42.5% 17% 27% 20% 20% 35%
23% 50% 46.25% 18% 28% 20% 20% 35%
24% 50% 50% 19% 29% 20% 20% 35%
25% 50% 50% 20% 30% 20% 20% 35%
26% 50% 50% 21% 31% 20% 20% 35%
27% 50% 50% 22% 32% 20% 20% 35%
28% 50% 50% 23% 33% 20% 20% 35%
29% 50% 50% 24% 34% 20% 20% 35%
30% 50% 50% 25% 35% 20% 20% 35%
31% 50% 50% 26% 35% 20% 20% 35%
32% 50% 50% 27% 35% 20% 20% 35%
33% 50% 50% 28% 35% 20% 20% 35%
34% 50% 50% 29% 35% 20% 20% 35%
35% 50% 50% 30% 35% 20% 20% 35%
36% 50% 50% 31% 35% 20% 20% 35%
37% 50% 50% 32% 35% 20% 20% 35%
38% 50% 50% 33% 35% 20% 20% 35%
39% 50% 50% 34% 35% 20% 20% 35%
40% 50% 50% 35% 35% 20% 20% 35%
41% 50% 50% 38.75% 35% 20% 20% 35%
42% 50% 50% 42.5% 35% 20% 20% 35%
43% 50% 50% 46.25% 35% 20% 20% 35%
44% 50% 50% 50% 35% 20% 20% 35%
100%***** 80% 80% 80% 35% 20% 20% 35%

AFFORDABLE UNIT
PERCENTAGE**

VERY LOW INCOME

DENSITY BONUS

LOW INCOME

DENSITY BONUS

MODERATE INCOME
DENSITY BONUS***

LAND DONATION
DENSITY BONUS SENIOR****

FOSTER YOUTH/

DISABLED VETS/

HOMELESS

COLLEGE

STUDENTS

REQUIRED INCENTIVES AND CONCESSIONS
In addition to the density bonus, the city or county is also required to provide one or more “incentives” or “concessions” to each project which qualifies for a density bonus (except that market rate senior citizen projects with no affordable units, and land donated for very low income housing, do not appear to be entitled to incentives or concessions). A concession or incentive is defined as:
• A reduction in site development standards or a modification of zoning code or architectural design requirements, such as a reduction in setback or minimum square footage requirements; or • Approval of mixed use zoning; or
• Other regulatory incentives or concessions which actually result in identifiable and actual cost reductions.

The number of required incentives or concessions is based on the percentage of affordable units in the project:
1 5% 10% 10%
2 10% 17% 20%
3 15% 24% 30%
4 100% Low/Very
Low/Mod
(20% Moderate allowed)
100% Low/Very
Low/Mod
(20% Moderate allowed)
100% Low/Very
Low/Mod
(20% Moderate allowed)
The city or county is required to grant the concession or incentive proposed by the developer unless it finds that the proposed concession or incentive does not result in identifiable and actual cost reductions, would cause a public health or safety problem, would cause an environmental problem, would harm historical property, or would be contrary to law. The Density Bonus Law restricts the types of information and reports that a developer may be required to provide to the local jurisdiction in order to obtain the requested incentive or concession. The local jurisdiction has the burden of proof in the event it declines to grant a requested incentive or concession. Financial incentives, fee waivers and reductions in dedication requirements may be, but are not required to be, provided by the city or county. The developer may be entitled to the incentives and concessions even without a request for a density bonus.

OTHER FORMS OF ASSISTANCE
A development qualifying for a density bonus also receives two additional forms of assistance which have important benefits for a housing project:
• Waiver or Reduction of Development Standards. If any other city or county development standard would physically prevent the project from being built at the permitted density and with the granted concessions/incentives, the developer may propose to have those standards waived or reduced. The city or county is not permitted to apply any development standard which physically precludes the construction of the project at its permitted density and with the granted concessions/incentives. The city or county is not required to waive or reduce development standards that would cause a public health or safety problem, cause an environmental problem, harm historical property, or would be contrary to law. The waiver or reduction of a development standard does not count as an incentive or concession, and there is no limit on the number of development standard waivers that may be requested or granted.

Development standards which have been waived or reduced utilizing this section include setback, lot coverage and open space requirements, and should apply to building height limits as well. This ability to force the locality to modify its normal development standards is sometimes the most compelling reason for the developer to structure a project to qualify for the density bonus.

NO. OF INCENTIVES/

CONCESSIONS

VERY LOW INCOME

PERCENTAGE

LOWER INCOME

PERCENTAGE

MODERATE INCOME

PERCENTAGE
MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 5

• Maximum Parking Requirements. Upon the developer’s request, the city or county may not require more than the following parking ratios for a density bonus project (inclusive of parking for persons with disabilities):

Studio 1 space
1 Bedroom 1 space
2 Bedroom 1.5 spaces
3 Bedroom 1.5 spaces
4 Bedroom 2.5 spaces
• Special Parking Requirements. Lower parking ratios apply to specified projects (although local jurisdictions can require higher parking ratios if supported by a specified parking study):

Rental/for sale projects with at least 11% very low income or 20% lower income units, within 1/2 mile of accessible major transit stop

0.5 spaces per unit
Rental projects 100% affordable to lower income, within 1/2 mile of accessible major transit stop
0 spaces per unit
Rental senior projects 100% affordable to lower income, either with paratransit service or within 1/2-half mile of accessible bus route (operating at least eight times per day)
0 spaces per unit
Rental special needs projects 100% affordable to lower income households, either with paratransit service or within 1/2-half mile of accessible bus route (operating at least eight times per day)
0 spaces per unit
Rental supportive housing developments 100% affordable to lower income households
0 spaces per unit
Onsite spaces may be provided through tandem or uncovered parking, but not onstreet parking. Requesting these parking standards does not count as an incentive or concession, but the developer may request further parking standard reductions as an incentive or concession. This is one of the most important benefits of the density bonus statute. In many cases, achieving a reduction in parking requirements may be more valuable than the additional permitted units. In higher density
developments requiring the use of structured parking, the construction cost of structured parking is very expensive, costing upwards of $20,000 per parking space. While this provision of the density bonus statute can be used to reduce excessive parking requirements, care must be taken not to impact the project’s marketability by reducing parking to minimum requirements which lead to parking shortages.

AFFORDABLE HOUSING RESTRICTIONS
• Rental Units. Affordable rental units must be restricted by an agreement which sets maximum incomes and rents for those units. As of January 1, 2015, the income and rent restrictions must remain in place for a 55 year term for very low or lower income units (formerly only a 30 year term was required).

Rents must be restricted as follows (continue to page 7):
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• For very low income units, rents may not exceed 30% x 50% of the area median income for a household size suitable for the unit.
• For lower income units, rents may not exceed 30% x 60% of the area median income for a household size suitable for the unit.
• In 100% affordable housing developments, the rent for at least 20% of the units must meet the rent standards of Health and Safety Code Section 50053, and the remaining units may instead meet Low Income Housing Tax Credit rent standards.
• Area median income is determined annually by regulation of the California Department of Housing and Community Development, based upon median income regulations adopted by the U.S.

Department of Housing and Urban Development.
• Rents must include a reasonable utility allowance.
• Household size appropriate to the unit means 1 for a studio unit, 2 for a one bedroom unit, 3 for a two bedroom unit, 4 for a three bedroom unit, etc.
• For Sale Units. Affordable for sale units must be sold to the initial buyer at an affordable housing cost.

Housing related costs include mortgage loan payments, mortgage insurance payments, property taxes and assessments, homeowner association fees, reasonable utilities allowance, insurance premiums, maintenance costs, and space rent.
• For very low income units, housing costs may not exceed 30% x 50% of the area median income for a household size suitable for the unit.
• For lower income units, housing costs may not exceed 30% x 70% of the area median income for a household size suitable for the unit.
• For moderate income units, housing costs may not exceed 35% x 110% of the area median income for a household size suitable for the unit.
• Buyers must enter into an equity sharing agreement with the city or county, unless the equity sharing requirements conflict with the requirements of another public funding source or law. The equity sharing agreement does not restrict the resale price, but requires the original owner to pay the city or county a portion of any appreciation received on resale. • The city/county percentage of appreciation is the purchase price discount received by the original buyer, plus any down payment assistance provided by the city/county. (For example, if the original sales price is $300,000, and the original fair market value is $400,000, and there is no city/county down payment assistance, the city/county subsidy is $100,000, and the city/county’s share of appreciation is 25%).

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• The seller is permitted to retain its original down payment, the value of any improvements made to the home, and the remaining share of the appreciation.
• The income and affordability requirements are not binding on resale purchasers (but if other public funding sources or programs are used, the requirements may apply to resales for a fixed number of years).

LOCAL GOVERNMENT PROCESSING OF DENSITY BONUS APPLICATIONS Under new legislation effective in 2019, local governments are now required to notify developers what information must be submitted for a complete density bonus application. Once a development application is determined to be complete, the local government must notify the developer the level of density bonus and parking ratio the development is eligible to receive. If the developer requests incentives, concessions, waivers or reductions of development standards, the local jurisdiction is required to notify the developer if it has submitted sufficient information necessary for the local government to make a determination on those issues.

HOW THE DENSITY BONUS WORKS FOR 100% AFFORDABLE PROJECTS 2019 legislation requires local governments to grant an 80% density bonus to housing projects in which all of the units (other than manager’s units) are restricted to very low, low and moderate income residents, with a maximum of 20% restricted to moderate income units. If a 100% affordable project is located within a half mile of a major transit stop, the local government may not impose any maximum density limits at all, and the project is further entitled to receive a maximum height increase of up to three additional stories or 33 feet.

However, if the project receives a waiver from maximum controls on density, it is not eligible for the waiver or reduction of any development standards which would otherwise be available. 100% affordable projects are also entitled to a fourth incentive or concession.

HOW THE DENSITY BONUS WORKS FOR SENIOR PROJECTS
As shown in the Density Bonus Chart on page 4, a senior citizen housing development of at least 35 units meeting the requirements of Section 51.3 or 51.12 of the Civil Code qualifies for a 20% density bonus. This is a very desirable option for senior housing developments. In jurisdictions where the local ordinances do not reduce the parking requirements for senior housing developments, the reduced parking requirements alone may justify applying for a density bonus.

HOW THE DENSITY BONUS WORKS FOR STUDENT HOUSING PROJECTS New legislation taking effect in 2019 requires cities and counties to grant a 35% density bonus for housing developments that will include at least 20% of the units for low income college students. The housing must be used exclusively for full-time students at accredited colleges, and must be subject to an operating agreement or master lease with one or more colleges. Unlike the maximum income requirements for other forms of affordable housing, resident income levels are determined through the student’s eligibility for the state’s Cal Grant financial aid program. Affordable rent levels are also specially tailored for a student population, with maximum rents established per bed for individual residents, rather than for the entire apartment unit. Homeless students receive priority for affordable units.

HOW THE DENSITY BONUS WORKS FOR COMMERCIAL PROJECTS
The Density Bonus Law requires that cities and counties provide a “development bonus” to commercial developers who partner with affordable housing developers for the construction of affordable housing on the commercial project site, or offsite within the jurisdiction located near schools, employment and a major transit stop. The commercial developer may participate through the donation of land or funds for the 8 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021

affordable housing, or direct construction of the housing units. The partnership between the commercial developer and the affordable developer can occur through a newly formed legal entity such as a corporation, LLC or partnership, or can take the shape of a contractual agreement between the parties. To be eligible for the development bonus, at least 30% of the housing units must be restricted to lower income residents or 15% of the housing units must be restricted to very low income residents. Unlike the primary Density Bonus Law, there is no fixed amount of increased density awarded to the developer. Instead, the development bonus can be any mutually agreeable incentive, including up to a 20% increase in development intensity, floor area ratio, or height limits, up to a 20% reduction in parking requirements, use of a limited use elevator, or an exception to a zoning ordinance or land use requirement. Commercial developers who need extra leverage to obtain more favorable development standards for their project may want to consider providing affordable housing in order to take advantage of the benefits of the development bonus.

HOW THE DENSITY BONUS WORKS FOR CONDOMINIUM CONVERSION PROJECTS The density bonus statute provides for a density bonus of up to 25% for condominium conversion projects providing at least 33% for the total units to low or moderate income households or 15% of the units to lower income households. Many condominium conversion projects are not designed in a manner that allows them to take advantage of the opportunity to construct additional units, but some projects may find this helpful.

HOW THE DENSITY BONUS WORKS FOR CHILDCARE
Housing projects that provide childcare are eligible for a separate density bonus equal to the size of the childcare facility. The childcare facility must remain in operation for at least the length of the affordability covenants. A percentage of the childcare spaces must also be made available to low and moderate income families. A separate statute permits cities and counties to grant density bonuses to commercial and industrial projects of at least 50,000 square feet, when the developer sets aside at least 2,000 square feet in the building and 3,000 square feet of outside space for a childcare facility.

HOW TO OBTAIN A DENSITY BONUS THROUGH LAND DONATION
Many market rate housing developers are uncomfortable with building and marketing affordable units themselves, whether due to their lack of experience with the affordable housing process or because of their desire to concentrate on their core market rate homes. Other developers may have sites that are underutilized in terms of project density. The Density Bonus Law contains a special sliding scale bonus for land donation which allows those developers to turn over the actual development of the affordable units to local agencies or experienced low income developers. The density bonus is available for the donation of at least an acre of fully entitled land, with all needed public facilities and infrastructure, and large enough for the construction of a high density very low income project containing 10% of the total homes in the development. The parcel must be located within the boundary of the proposed development or, subject to the approval of the jurisdiction, within one-fourth mile of the boundary of the proposed development. The more units that can be built on the donated land, the larger the density bonus. Because of the parcel size requirements, this option is only practical for larger developments. The land donation density bonus can be combined with the regular density bonus provided for the development of affordable units, up to a maximum 35% density bonus. A master planned community developer needs to carefully evaluate the land donation option as opposed to engaging an affordable housing developer to fulfill the project’s affordable housing obligations. In many cases the master developer will prefer to control the affordable component of the project through a direct agreement with the affordable housing developer, rather than allowing the local government to control the project.

FLOOR AREA RATIO BONUSES
Under new legislation effective in 2019, a local jurisdiction is permitted to grant a floor area ratio bonus rather than a traditional density bonus to certain high density affordable housing projects adjacent to public MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 9

transit. Eligible projects are also entitled to special parking ratios of one-tenth of a parking space per affordable unit and one-half space per market rate unit. To be eligible for the floor area ratio bonus, the project must restrict at least 20 percent of the units to very low income tenants, must be located within a transit priority area or near a major transit stop, and must be in compliance with local height limits.

How the Density Bonus Can Help in a Friendly Jurisdiction While the Density Bonus Law is often used by developers to obtain more housing than the local jurisdiction would ordinarily permit, it can also be a helpful land use tool in jurisdictions which favor the proposed project and want to provide support. Planners in many cities and counties may be disposed by personal ideology or local policy to encourage the construction of higher density housing and mixed use developments near transit stops and downtown areas, but are hampered by existing general plan standards and zoning from approving these sorts of projects. Elected officials often support these projects too, but may find it politically difficult to oppose neighborhood and environmental groups over the necessary general plan amendments, zoning changes and CEQA approvals.

The density bonus can provide a useful mechanism for increasing allowable density without requiring local officials to approve general plan amendments and zoning changes. A project that satisfies the requirements of the Density Bonus Law often can obtain the necessary land use approvals through the award of the density bonus units and requested concessions and incentives, without having to amend the underlying land use requirements. Friendly local officials may encourage the use of the density bonus to “force” the jurisdiction to approve a desired project.
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How the Density Bonus Law Can Help in a Hostile Jurisdiction It is important to know that the density bonus is a state law requirement which is mandatory on cities and counties, even charter cities which are free from many other state requirements. A developer who meets the law’s requirements for affordable or senior units is entitled to the density bonus and other assistance as of right, regardless of the locality’s desires (subject to limited health and safety exceptions). The density bonus statute can be used to achieve reductions in development standards or the granting of concessions or incentives from jurisdictions that otherwise would not be inclined to grant those items. Examples might include a reduction in parking standards if those standards are deemed excessive by the developer, or other reductions in development standards if needed to achieve the total density permitted by the density bonus.

Developers who nonetheless encounter hostility from local jurisdictions are provided several tools to ensure that a required density bonus is actually granted. Developers are entitled to an informal meeting with a local jurisdiction which fails to modify a requested development standard. If a developer successfully sues the locality to enforce the density bonus requirements, it is entitled to an award of its attorneys’ fees. The obligation to pay a developer’s attorneys’ fees is a powerful incentive for local jurisdictions to voluntarily comply with the state law density bonus requirements, even when the jurisdiction is not in favor of its effects on the project.

CEQA Issues in Density Bonus Projects
Although there is no specific density bonus exemption from the California Environmental Quality Act (CEQA), many density bonus projects are likely candidates for urban infill and affordable housing exemptions from CEQA. One commonly invoked exemption is the Class 32 urban infill exemption found in CEQA Guidelines Section 15332. That exemption is available if the project is consistent with applicable general plan designation and zoning, the site is five acres or less and surrounded by urban uses, is not habitat for endangered, rare or threatened species, does not have any significant effects relating to traffic, noise, air quality or water quality, and is adequately served by utilities and public services. Other exemptions are available for high density housing projects near major transit stops (CEQA Guidelines Section 15195) and affordable housing projects of up to 100 units (CEQA Guidelines Section 15194).

A 2011 case, Wollmer v. City of Berkeley, clarified the use of the CEQA infill exemption for density bonus projects. In that case, an opponent of a Berkeley density bonus project challenged the City’s use of the urban infill exemption on the grounds that the City’s modifications and waivers of development standards, as required under the Density Bonus Law, meant that the project was not consistent with existing zoning.

The court rejected that argument, finding that the modifications required by the Density Bonus Law did not disqualify the project from claiming the exemption.

Not all density bonus projects will qualify for one of these CEQA exemptions, however. Sometimes the additional density provided to non-exempt projects may bring the project out of the coverage of an existing CEQA approval for a general plan, specific plan or other larger project. For instance, if a previously approved environmental impact report analyzed a 100 unit project as the largest allowed under existing zoning, but the developer is able to qualify for 120 units with a density bonus, the existing EIR may not cover the larger project. The larger density bonus project may require additional CEQA analysis for approval.

Using the Density Bonus to Satisfy Inclusionary Housing Requirements Many of California’s cities and counties have adopted inclusionary housing ordinances, which typically require that a specified percentage of units in a new housing development be restricted as affordable units.

The inclusionary requirements significantly reduce income from rental units and sales prices of for-sale homes. In today’s tight housing market, compliance with local inclusionary requirements may make many projects economically infeasible. The density bonus provides one method for developers to improve the economics of their project while still complying with the inclusionary A 2013 case, Latinos Unidos del Valle de MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 11

Napa y Solano v. County of Napa, held that inclusionary units qualify as affordable units for purposes of the Density Bonus Law. The case confirmed that the density bonus is a financial tool available to help developers achieve city and county inclusionary housing requirements.

Density Bonus and Replacement Housing
Developers obtaining a density bonus are required to replace existing units which were previously occupied by very low or lower income households or subject to rent control, when those units have been demolished or vacated prior to the density bonus application. The housing development must also meet the applicable affordable housing standards, including the replacement units. As a result of uncertainty about how to apply these standards when the income levels of prior residents is unknown. The Density Bonus Law establishes a rebuttable presumption for the income level of the replacement unit when the income level of the actual prior resident is unknown.

Density Bonus in the Coastal Zone
When affordable housing is proposed in the coastal zone, the Density Bonus Law’s focus on encouraging the development of affordable housing could clash with the California Coastal Act’s focus on environmental protection. Legislation effective in 2019 now requires the density bonus to be administered in the Coastal Zone in a manner that is consistent and harmonized with the California Coastal Act. This legislation overturns a 2016 appellate court ruling, Kalnel Gardens, LLC v. City of Los Angeles, which found that a proposed housing project that violates the Coastal Act as a result of a density bonus could be denied on that basis. The court in Kalnel Gardens held that the Density Bonus Law is subordinate to the Coastal Act, but the new language attempts to strike a balance between the state goals of promoting housing and protecting the coast.

Density Bonus – A Flexible Tool
The Density Bonus Law can be a powerful tool for different types of development projects, whether they are traditional affordable housing projects, predominantly market rate housing developments, or senior projects. Obtaining greater density can help the developer of any project bring costs and financing sources into line by putting more homes on the land, reducing the per unit land costs. Use of the favorable parking requirements can reduce the amount of costly land needed for parking. The incentives and concessions to be provided by the local government can provide a helpful way to modify development requirements which may stand in the way of a successful project. Of course there is a price to pay for these benefits—the affordable units needed to earn the density bonus. Developers need to make a cost-benefit determination whether the cost of compliance is worth the benefits. But the Density Bonus Law is unquestionably a useful option for housing developers trying to make financial sense of projects in today’s economy. 12 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021

Density Bonus Statutes
Government Code Sections 65915 – 65918.

Effective as of January 1, 2021
65915. (a) (1) When an applicant seeks a density
bonus for a housing development within, or for the
donation of land for housing within, the jurisdiction of a city, county, or city and county, that local government shall comply with this section. A city, county, or city and county shall adopt an ordinance that specifies
how compliance with this section will be implemented.

Except as otherwise provided in subdivision (s), failure to adopt an ordinance shall not relieve a city, county, or city and county from complying with this section.
(2) A local government shall not condition the
submission, review, or approval of an application
pursuant to this chapter on the preparation of an
additional report or study that is not otherwise required by state law, including this section. This subdivision
does not prohibit a local government from requiring
an applicant to provide reasonable documentation
to establish eligibility for a requested density bonus, incentives or concessions, as described in subdivision
(d), waivers or reductions of development standards,
as described in subdivision (e), and parking ratios, as described in subdivision (p).
(3) In order to provide for the expeditious processing of a density bonus application, the local government shall do all of the following:
(A) Adopt procedures and timelines for processing a
density bonus application.
(B) Provide a list of all documents and information
required to be submitted with the density bonus
application in order for the density bonus application to be deemed complete. This list shall be consistent with
this chapter.
(C) Notify the applicant for a density bonus whether
the application is complete in a manner consistent with the timelines specified in Section 65943.
(D) (i) If the local government notifies the applicant
that the application is deemed complete pursuant to
subparagraph (C), provide the applicant with a
determination as to the following matters:
(I) The amount of density bonus, calculated pursuant
to subdivision (f), for which the applicant is eligible. (II) If the applicant requests a parking ratio pursuant to subdivision (p), the parking ratio for which the
applicant is eligible.
(III) If the applicant requests incentives or concessions pursuant to subdivision (d) or waivers or reductions of development standards pursuant to subdivision (e),
whether the applicant has provided adequate
information for the local government to make a
determination as to those incentives, concessions, or
waivers or reductions of development standards.
(ii) Any determination required by this subparagraph
shall be based on the development project at the time
the application is deemed complete. The local
government shall adjust the amount of density bonus
and parking ratios awarded pursuant to this section
based on any changes to the project during the course
of development.
(b) (1) A city, county, or city and county shall grant one density bonus, the amount of which shall be as
specified in subdivision (f), and, if requested by the
applicant and consistent with the applicable
requirements of this section, incentives or concessions, as described in subdivision (d), waivers or reductions
of development standards, as described in
subdivision (e), and parking ratios, as described in
subdivision (p), when an applicant for a housing
development seeks and agrees to construct a
housing development, excluding any units permitted
by the density bonus awarded pursuant to this section,
that will contain at least any one of the following:
(A) Ten percent of the total units of a housing
development for lower income households, as defined
in Section 50079.5 of the Health and Safety Code.
(B) Five percent of the total units of a housing
development for very low income households, as
defined in Section 50105 of the Health and Safety
Code.
(C) A senior citizen housing development, as defined
in Sections 51.3 and 51.12 of the Civil Code, or a
mobilehome park that limits residency based on age
requirements for housing for older persons pursuant
to Section 798.76 or 799.5 of the Civil Code.
(D) Ten percent of the total dwelling units in a common interest development, as defined in Section 4100 of
the Civil Code, for persons and families of moderate
income, as defined in Section 50093 of the Health and
Safety Code, provided that all units in the development are offered to the public for purchase.
(E) Ten percent of the total units of a housing
development for transitional foster youth, as defined in Section 66025.9 of the Education Code, disabled
veterans, as defined in Section 18541, or homeless
persons, as defined in the federal McKinney-Vento
Homeless Assistance Act (42 U.S.C. Sec. 11301 et seq.).

The units described in this subparagraph shall be
subject to a recorded affordability restriction of 55
years and shall be provided at the same affordability
level as very low income units.

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14 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 (F) (i) Twenty percent of the total units for lower income students in a student housing development that meets
the following requirements:
(I) All units in the student housing development will be used exclusively for undergraduate, graduate, or
professional students enrolled full time at an institution of higher education accredited by the Western
Association of Schools and Colleges or the
Accrediting Commission for Community and Junior
Colleges. In order to be eligible under this subclause, the developer shall, as a condition of receiving a
certificate of occupancy, provide evidence to the city, county, or city and county that the developer has
entered into an operating agreement or master lease
with one or more institutions of higher education for
the institution or institutions to occupy all units of the student housing development with students from that
institution or institutions. An operating agreement or
master lease entered into pursuant to this subclause
is not violated or breached if, in any subsequent year, there are not sufficient students enrolled in an
institution of higher education to fill all units in the student housing development.
(II) The applicable 20-percent units will be used for
lower income students. For purposes of this clause,
“lower income students” means students who have a
household income and asset level that does not exceed
the level for Cal Grant A or Cal Grant B award recipients as set forth in paragraph (1) of subdivision (k) of
Section 69432.7 of the Education Code. The eligibility
of a student under this clause shall be verified by an
affidavit, award letter, or letter of eligibility provided by the institution of higher education that the student is enrolled in, as described in subclause (I), or by the
California Student Aid Commission that the student
receives or is eligible for financial aid, including an institutional grant or fee waiver, from the college or
university, the California Student Aid Commission, or
the federal government shall be sufficient to satisfy this subclause.
(III) The rent provided in the applicable units of the
development for lower income students shall be
calculated at 30 percent of 65 percent of the area
median income for a single-room occupancy unit type.
(IV) The development will provide priority for the
applicable affordable units for lower income students
experiencing homelessness. A homeless service
provider, as defined in paragraph (3) of subdivision (e) of Section 103577 of the Health and Safety Code, or
institution of higher education that has knowledge of a person’s homeless status may verify a person’s status
as homeless for purposes of this subclause.
(ii) For purposes of calculating a density bonus granted pursuant to this subparagraph, the term “unit” as used
in this section means one rental bed and its pro rata
share of associated common area facilities. The units
described in this subparagraph shall be subject to a
recorded affordability restriction of 55 years.
(G) One hundred percent of all units in the
development, including total units and density bonus
units, but exclusive of a manager’s unit or units, are
for lower income households, as defined by Section
50079.5 of the Health and Safety Code, except that up
to 20 percent of the units in the development, including total units and density bonus units, may be for
moderate-income households, as defined in Section
50053 of the Health and Safety Code.
(2) For purposes of calculating the amount of the
density bonus pursuant to subdivision (f), an applicant who requests a density bonus pursuant to this
subdivision shall elect whether the bonus shall be
awarded on the basis of subparagraph (A), (B), (C), (D), (E), (F), or (G) of paragraph (1).
(3) For the purposes of this section, “total units,” “total dwelling units,” or “total rental beds” does not include units added by a density bonus awarded pursuant to
this section or any local law granting a greater density bonus.
(c) (1) (A) An applicant shall agree to, and the city,
county, or city and county shall ensure, the continued
affordability of all very low and low-income rental units that qualified the applicant for the award of the density bonus for 55 years or a longer period of time if required by the construction or mortgage financing assistance
program, mortgage insurance program, or rental
subsidy program.
(B) (i) Except as otherwise provided in clause (ii), rents for the lower income density bonus units shall be set at an affordable rent, as defined in Section 50053 of the
Health and Safety Code.
(ii) For housing developments meeting the criteria of
subparagraph (G) of paragraph (1) of subdivision (b),
rents for all units in the development, including both
base density and density bonus units, shall be as follows:
(I) The rent for at least 20 percent of the units in the development shall be set at an affordable rent, as
defined in Section 50053 of the Health and Safety
Code.
(II) The rent for the remaining units in the development shall be set at an amount consistent with the maximum
rent levels for a housing development that receives an
allocation of state or federal low-income housing tax
credits from the California Tax Credit Allocation
Committee.
(2) An applicant shall agree to, and the city, county, or Page 105 of 267 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 15 city and county shall ensure that, the initial occupant of all for-sale units that qualified the applicant for the award of the density bonus are persons and families
of very low, low, or moderate income, as required, and
that the units are offered at an affordable housing cost, as that cost is defined in Section 50052.5 of the Health and Safety Code. The local government shall enforce
an equity sharing agreement, unless it is in conflict with the requirements of another public funding source or
law. The following apply to the equity sharing
agreement:
(A) Upon resale, the seller of the unit shall retain the value of any improvements, the downpayment, and
the seller’s proportionate share of appreciation. The
local government shall recapture any initial subsidy,
as defined in subparagraph (B), and its proportionate
share of appreciation, as defined in subparagraph (C),
which amount shall be used within five years for any of the purposes described in subdivision (e) of Section
33334.2 of the Health and Safety Code that promote
home ownership.
(B) For purposes of this subdivision, the local
government’s initial subsidy shall be equal to the fair market value of the home at the time of initial sale
minus the initial sale price to the moderate-income
household, plus the amount of any downpayment
assistance or mortgage assistance. If upon resale the
market value is lower than the initial market value, then the value at the time of the resale shall be used as the initial market value.
(C) For purposes of this subdivision, the local
government’s proportionate share of appreciation shall
be equal to the ratio of the local government’s initial subsidy to the fair market value of the home at the time of initial sale.
(3) (A) An applicant shall be ineligible for a density
bonus or any other incentives or concessions under
this section if the housing development is proposed on
any property that includes a parcel or parcels on which rental dwelling units are or, if the dwelling units have been vacated or demolished in the five-year period
preceding the application, have been subject to a
recorded covenant, ordinance, or law that restricts
rents to levels affordable to persons and families of
lower or very low income; subject to any other form of
rent or price control through a public entity’s valid
exercise of its police power; or occupied by lower or
very low income households, unless the proposed
housing development replaces those units, and either
of the following applies:
(i) The proposed housing development, inclusive of the
units replaced pursuant to this paragraph, contains
affordable units at the percentages set forth in
subdivision (b).
(ii) Each unit in the development, exclusive of a
manager’s unit or units, is affordable to, and occupied by, either a lower or very low income household.
(B) For the purposes of this paragraph, “replace” shall mean either of the following:
(i) If any dwelling units described in subparagraph (A) are occupied on the date of application, the proposed
housing development shall provide at least the same
number of units of equivalent size to be made available at affordable rent or affordable housing cost to, and
occupied by, persons and families in the same or lower
income category as those households in occupancy. If
the income category of the household in occupancy is
not known, it shall be rebuttably presumed that lower
income renter households occupied these units in the
same proportion of lower income renter households to
all renter households within the jurisdiction, as
determined by the most recently available data from
the United States Department of Housing and Urban
Development’s Comprehensive Housing Affordability
Strategy database. For unoccupied dwelling units
described in subparagraph (A) in a development with
occupied units, the proposed housing development
shall provide units of equivalent size to be made
available at affordable rent or affordable housing cost to, and occupied by, persons and families in the same
or lower income category as the last household in
occupancy. If the income category of the last
household in occupancy is not known, it shall be
rebuttably presumed that lower income renter
households occupied these units in the same
proportion of lower income renter households to all
renter households within the jurisdiction, as
determined by the most recently available data from
the United States Department of Housing and Urban
Development’s Comprehensive Housing
Affordability Strategy database. All replacement
calculations resulting in fractional units shall be
rounded up to the next whole number. If the
replacement units will be rental dwelling units, these
units shall be subject to a recorded affordability
restriction for at least 55 years. If the proposed
development is for-sale units, the units replaced shall be subject to paragraph (2).
(ii) If all dwelling units described in subparagraph (A) have been vacated or demolished within the five-year
period preceding the application, the proposed housing
development shall provide at least the same number
of units of equivalent size as existed at the highpoint of those units in the five-year period preceding the
application to be made available at affordable rent or
affordable housing cost to, and occupied by, persons
and families in the same or lower income category as
those persons and families in occupancy at that time, if known. If the incomes of the persons and families in
occupancy at the highpoint is not known, it shall be
rebuttably presumed that low-income and very low Page 106 of 267 16 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 income renter households occupied these units in the
same proportion of low-income and very low income
renter households to all renter households within the
jurisdiction, as determined by the most recently
available data from the United States Department of
Housing and Urban Development’s Comprehensive
Housing Affordability Strategy database. All
replacement calculations resulting in fractional units
shall be rounded up to the next whole number. If the
replacement units will be rental dwelling units, these
units shall be subject to a recorded affordability
restriction for at least 55 years. If the proposed
development is for-sale units, the units replaced shall be subject to paragraph (2).
(C) Notwithstanding subparagraph (B), for any
dwelling unit described in subparagraph (A) that is or
was, within the five-year period preceding the
application, subject to a form of rent or price control through a local government’s valid exercise of its police power and that is or was occupied by persons or
families above lower income, the city, county, or city
and county may do either of the following:
(i) Require that the replacement units be made
available at affordable rent or affordable housing cost to, and occupied by, low-income persons or families.

If the replacement units will be rental dwelling units, these units shall be subject to a recorded affordability restriction for at least 55 years. If the proposed
development is for-sale units, the units replaced shall be subject to paragraph (2).
(ii) Require that the units be replaced in compliance
with the jurisdiction’s rent or price control ordinance, provided that each unit described in subparagraph (A)
is replaced. Unless otherwise required by the
jurisdiction’s rent or price control ordinance, these
units shall not be subject to a recorded affordability
restriction.
(D) For purposes of this paragraph, “equivalent size”
means that the replacement units contain at least the
same total number of bedrooms as the units being
replaced.
(E) Subparagraph (A) does not apply to an applicant
seeking a density bonus for a proposed housing
development if the applicant’s application was
submitted to, or processed by, a city, county, or city and county before January 1, 2015.
(d) (1) An applicant for a density bonus pursuant to
subdivision (b) may submit to a city, county, or city
and county a proposal for the specific incentives or
concessions that the applicant requests pursuant to
this section, and may request a meeting with the city,
county, or city and county. The city, county, or city and county shall grant the concession or incentive
requested by the applicant unless the city, county, or
city and county makes a written finding, based upon
substantial evidence, of any of the following:
(A) The concession or incentive does not result in
identifiable and actual cost reductions, consistent with subdivision (k), to provide for affordable housing costs, as defined in Section 50052.5 of the Health and Safety
Code, or for rents for the targeted units to be set as
specified in subdivision (c).
(B) The concession or incentive would have a specific,
adverse impact, as defined in paragraph (2) of
subdivision (d) of Section 65589.5, upon public health
and safety or the physical environment or on any real
property that is listed in the California Register of
Historical Resources and for which there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact without rendering the development
unaffordable to low-income and moderate-income
households.
(C) The concession or incentive would be contrary to
state or federal law.
(2) The applicant shall receive the following number of incentives or concessions:
(A) One incentive or concession for projects that
include at least 10 percent of the total units for lower income households, at least 5 percent for very low
income households, or at least 10 percent for persons
and families of moderate income in a common interest
development.
(B) Two incentives or concessions for projects that
include at least 17 percent of the total units for lower income households, at least 10 percent for very low
income households, or at least 20 percent for persons
and families of moderate income in a common interest
development.
(C) Three incentives or concessions for projects that
include at least 24 percent of the total units for lower income households, at least 15 percent for very low
income households, or at least 30 percent for persons
and families of moderate income in a common interest
development.
(D) Four incentives or concessions for projects
meeting the criteria of subparagraph (G) of paragraph
(1) of subdivision (b). If the project is located within one-half mile of a major transit stop, the applicant shall also receive a height increase of up to three additional stories, or 33 feet.
(3) The applicant may initiate judicial proceedings if
the city, county, or city and county refuses to grant a requested density bonus, incentive, or concession. If a court finds that the refusal to grant a requested density bonus, incentive, or concession is in violation of this Page 107 of 267 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 17 section, the court shall award the plaintiff reasonable attorney’s fees and costs of suit. Nothing in this
subdivision shall be interpreted to require a local
government to grant an incentive or concession that
has a specific, adverse impact, as defined in paragraph (2) of subdivision (d) of Section 65589.5, upon health, safety, or the physical environment, and for which there is no feasible method to satisfactorily mitigate or avoid the specific adverse impact. Nothing in this
subdivision shall be interpreted to require a local
government to grant an incentive or concession that
would have an adverse impact on any real property
that is listed in the California Register of Historical Resources. The city, county, or city and county shall
establish procedures for carrying out this section that shall include legislative body approval of the means of compliance with this section.
(4) The city, county, or city and county shall bear
the burden of proof for the denial of a requested
concession or incentive.
(e) (1) In no case may a city, county, or city and county apply any development standard that will have the
effect of physically precluding the construction of a
development meeting the criteria of subdivision (b) at
the densities or with the concessions or incentives
permitted by this section. Subject to paragraph (3),
an applicant may submit to a city, county, or city and
county a proposal for the waiver or reduction of
development standards that will have the effect of
physically precluding the construction of a
development meeting the criteria of subdivision (b)
at the densities or with the concessions or incentives
permitted under this section, and may request a
meeting with the city, county, or city and county. If a court finds that the refusal to grant a waiver or
reduction of development standards is in violation
of this section, the court shall award the plaintiff
reasonable attorney’s fees and costs of suit. Nothing in this subdivision shall be interpreted to require a local government to waive or reduce development standards
if the waiver or reduction would have a specific, adverse impact, as defined in paragraph (2) of subdivision (d)
of Section 65589.5, upon health, safety, or the physical environment, and for which there is no feasible method
to satisfactorily mitigate or avoid the specific adverse impact. Nothing in this subdivision shall be interpreted to require a local government to waive or reduce
development standards that would have an adverse
impact on any real property that is listed in the
California Register of Historical Resources, or to grant any waiver or reduction that would be contrary to state or federal law.
(2) A proposal for the waiver or reduction of
development standards pursuant to this subdivision
shall neither reduce nor increase the number of
incentives or concessions to which the applicant is
entitled pursuant to subdivision (d).
(3) A housing development that receives a waiver from
any maximum controls on density pursuant to clause
(ii) of subparagraph (D) of paragraph (3) of
subdivision (f) shall only be eligible for a waiver or
reduction of development standards as provided in
subparagraph (D) of paragraph (2) of subdivision (d)
and clause (ii) of subparagraph (D) of paragraph (3)
of subdivision (f), unless the city, county, or city and county agrees to additional waivers or reductions of
development standards.
(f) For the purposes of this chapter, “density bonus”
means a density increase over the otherwise maximum
allowable gross residential density as of the date of
application by the applicant to the city, county, or city and county, or, if elected by the applicant, a lesser
percentage of density increase, including, but not
limited to, no increase in density. The amount of density increase to which the applicant is entitled shall vary
according to the amount by which the percentage of
affordable housing units exceeds the percentage
established in subdivision (b).
(1) For housing developments meeting the criteria of
subparagraph (A) of paragraph (1) of subdivision (b),
the density bonus shall be calculated as follows:
10 20
11 21.5
12 23
13 24.5
14 26
15 27.5
16 29
17 30.5
18 32
19 33.5
20 35
21 38.75
22 42.5
23 46.25
24 50
(2) For housing developments meeting the criteria of
subparagraph (B) of paragraph (1) of subdivision (b),
the density bonus shall be calculated as follows:
5 20
6 22.5

PERCENTAGE

LOW-INCOME
UNITS

PERCENTAGE

DENSITY
BONUS

PERCENTAGE

VERY LOW-INCOME
UNITS

PERCENTAGE

DENSITY
BONUS

18 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 7 25
8 27.5
9 30
10 32.5
11 35
12 38.75
13 42.5
14 46.25
15 50
(3) (A) For housing developments meeting the criteria
of subparagraph (C) of paragraph (1) of subdivision (b), the density bonus shall be 20 percent of the number of
senior housing units.
(B) For housing developments meeting the criteria of
subparagraph (E) of paragraph (1) of subdivision (b),
the density bonus shall be 20 percent of the number
of the type of units giving rise to a density bonus under that subparagraph.
(C) For housing developments meeting the criteria of
subparagraph (F) of paragraph (1) of subdivision (b),
the density bonus shall be 35 percent of the student
housing units.
(D) For housing developments meeting the criteria of
subparagraph (G) of paragraph (1) of subdivision (b),
the following shall apply:
(i) Except as otherwise provided in clause (ii), the
density bonus shall be 80 percent of the number of
units for lower income households.
(ii) If the housing development is located within
one-half mile of a major transit stop, the city, county, or city and county shall not impose any maximum controls
on density.
(4) For housing developments meeting the criteria of
subparagraph (D) of paragraph (1) of subdivision (b),
the density bonus shall be calculated as follows:
10 5
11 6
12 7
13 8
14 9
15 10
16 11
17 12
18 13
19 14
20 15
21 16
22 17
23 18
24 19
25 20
26 21
27 22
28 23
29 24
30 25
31 26
32 27
33 28
34 29
35 30
36 31
37 32
38 33
39 34
40 35
41 38.75
42 42.5
43 46.25
44 50
(5) All density calculations resulting in fractional units shall be rounded up to the next whole number. The
granting of a density bonus shall not require, or be
interpreted, in and of itself, to require a general plan amendment, local coastal plan amendment, zoning
change, or other discretionary approval.
(g) (1) When an applicant for a tentative subdivision
map, parcel map, or other residential development
approval donates land to a city, county, or city and
county in accordance with this subdivision, the
applicant shall be entitled to a 15-percent increase
above the otherwise maximum allowable residential
density for the entire development, as follows:
10 15
11 16
12 17
13 18
14 19

PERCENTAGE

MODERATE-INCOME
UNITS

PERCENTAGE

DENSITY
BONUS

PERCENTAGE

VERY LOW-INCOME

PERCENTAGE

DENSITY
BONUS

MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 19 15 20
16 21
17 22
18 23
19 24
20 25
21 26
22 27
23 28
24 29
25 30
26 31
27 32
28 33
29 34
30 35
(2) This increase shall be in addition to any increase in density mandated by subdivision (b), up to a maximum
combined mandated density increase of 35 percent if
an applicant seeks an increase pursuant to both this
subdivision and subdivision (b). All density calculations resulting in fractional units shall be rounded up to the next whole number. Nothing in this subdivision shall
be construed to enlarge or diminish the authority of a
city, county, or city and county to require a developer to donate land as a condition of development. An
applicant shall be eligible for the increased density
bonus described in this subdivision if all of the following conditions are met:
(A) The applicant donates and transfers the land no
later than the date of approval of the final subdivision map, parcel map, or residential development
application.
(B) The developable acreage and zoning classification
of the land being transferred are sufficient to permit
construction of units affordable to very low income
households in an amount not less than 10 percent of
the number of residential units of the proposed
development.
(C) The transferred land is at least one acre in size or of sufficient size to permit development of at least 40 units, has the appropriate general plan designation,
is appropriately zoned with appropriate development
standards for development at the density described
in paragraph (3) of subdivision (c) of Section 65583.2, and is or will be served by adequate public facilities and infrastructure.
(D) The transferred land shall have all of the permits
and approvals, other than building permits, necessary
for the development of the very low income housing
units on the transferred land, not later than the date of approval of the final subdivision map, parcel map, or
residential development application, except that the
local government may subject the proposed
development to subsequent design review to the extent
authorized by subdivision (i) of Section 65583.2 if the design is not reviewed by the local government before
the time of transfer.
(E) The transferred land and the affordable units shall be subject to a deed restriction ensuring continued
affordability of the units consistent with paragraphs (1) and (2) of subdivision (c), which shall be recorded on
the property at the time of the transfer.
(F) The land is transferred to the local agency or to a housing developer approved by the local agency. The
local agency may require the applicant to identify and
transfer the land to the developer.
(G) The transferred land shall be within the boundary
of the proposed development or, if the local agency
agrees, within one-quarter mile of the boundary of the
proposed development.
(H) A proposed source of funding for the very low
income units shall be identified not later than the date of approval of the final subdivision map, parcel map, or residential development application.
(h) (1) When an applicant proposes to construct a
housing development that conforms to the
requirements of subdivision (b) and includes a
childcare facility that will be located on the premises of, as part of, or adjacent to, the project, the city, county, or city and county shall grant either of the following:
(A) An additional density bonus that is an amount
of square feet of residential space that is equal to or greater than the amount of square feet in the childcare facility.
(B) An additional concession or incentive that
contributes significantly to the economic feasibility of the construction of the childcare facility.
(2) The city, county, or city and county shall require, as a condition of approving the housing development, that
the following occur:
(A) The childcare facility shall remain in operation for a period of time that is as long as or longer than the
period of time during which the density bonus units are required to remain affordable pursuant to subdivision
(c).
(B) Of the children who attend the childcare facility, the children of very low income households, lower income
households, or families of moderate income shall equal
a percentage that is equal to or greater than the Page 110 of 267 20 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 percentage of dwelling units that are required for very low income households, lower income households, or
families of moderate income pursuant to subdivision
(b).
(3) Notwithstanding any requirement of this
subdivision, a city, county, or city and county shall not be required to provide a density bonus or concession
for a childcare facility if it finds, based upon substantial evidence, that the community has adequate childcare
facilities.
(4) “Childcare facility,” as used in this section, means a child daycare facility other than a family daycare home, including, but not limited to, infant centers, preschools, extended daycare facilities, and schoolage childcare
centers.
(i) “Housing development,” as used in this section,
means a development project for five or more
residential units, including mixed-use developments.

For the purposes of this section, “housing
development” also includes a subdivision or common
interest development, as defined in Section 4100 of
the Civil Code, approved by a city, county, or city and county and consists of residential units or unimproved
residential lots and either a project to substantially
rehabilitate and convert an existing commercial
building to residential use or the substantial
rehabilitation of an existing multifamily dwelling, as
defined in subdivision (d) of Section 65863.4, where
the result of the rehabilitation would be a net increase in available residential units. For the purpose of
calculating a density bonus, the residential units shall be on contiguous sites that are the subject of one
development application, but do not have to be based
upon individual subdivision maps or parcels. The
density bonus shall be permitted in geographic areas of the housing development other than the areas where
the units for the lower income households are located.
(j) (1) The granting of a concession or incentive shall not require or be interpreted, in and of itself, to require a general plan amendment, local coastal plan
amendment, zoning change, study, or other
discretionary approval. For purposes of this
subdivision, “study” does not include reasonable
documentation to establish eligibility for the
concession or incentive or to demonstrate that the
incentive or concession meets the definition set forth in subdivision (k). This provision is declaratory of existing law.
(2) Except as provided in subdivisions (d) and (e), the granting of a density bonus shall not require or be
interpreted to require the waiver of a local ordinance or provisions of a local ordinance unrelated to
development standards.
(k) For the purposes of this chapter, concession or
incentive means any of the following:
(1) A reduction in site development standards or a
modification of zoning code requirements or
architectural design requirements that exceed the
minimum building standards approved by the California
Building Standards Commission as provided in Part 2.5
(commencing with Section 18901) of Division 13 of the
Health and Safety Code, including, but not limited to, a reduction in setback and square footage requirements
and in the ratio of vehicular parking spaces that would otherwise be required that results in identifiable and
actual cost reductions, to provide for affordable
housing costs, as defined in Section 50052.5 of the
Health and Safety Code, or for rents for the targeted
units to be set as specified in subdivision (c).
(2) Approval of mixed-use zoning in conjunction with
the housing project if commercial, office, industrial,
or other land uses will reduce the cost of the housing
development and if the commercial, office, industrial, or other land uses are compatible with the housing project and the existing or planned development in the area
where the proposed housing project will be located.
(3) Other regulatory incentives or concessions
proposed by the developer or the city, county, or city
and county that result in identifiable and actual cost
reductions to provide for affordable housing costs, as
defined in Section 50052.5 of the Health and Safety
Code, or for rents for the targeted units to be set as
specified in subdivision (c).
(l) Subdivision (k) does not limit or require the
provision of direct financial incentives for the housing development, including the provision of publicly owned
land, by the city, county, or city and county, or the
waiver of fees or dedication requirements.
(m) This section does not supersede or in any way
alter or lessen the effect or application of the California Coastal Act of 1976 (Division 20 (commencing with
Section 30000) of the Public Resources Code). Any
density bonus, concessions, incentives, waivers or
reductions of development standards, and parking
ratios to which the applicant is entitled under this
section shall be permitted in a manner that is
consistent with this section and Division 20
(commencing with Section 30000) of the Public
Resources Code.
(n) If permitted by local ordinance, nothing in this
section shall be construed to prohibit a city, county,
or city and county from granting a density bonus
greater than what is described in this section for a
development that meets the requirements of this
section or from granting a proportionately lower
density bonus than what is required by this section for developments that do not meet the requirements of
this section. Page 111 of 267
MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 21 (o) For purposes of this section, the following
definitions shall apply:
(1) “Development standard” includes a site or
construction condition, including, but not limited to, a height limitation, a setback requirement, a floor area
ratio, an onsite open-space requirement, or a parking
ratio that applies to a residential development pursuant to any ordinance, general plan element, specific plan,
charter, or other local condition, law, policy, resolution, or regulation.
(2) “Located within one-half mile of a major transit
stop” means that any point on a proposed
development, for which an applicant seeks a density
bonus, other incentives or concessions, waivers or
reductions of development standards, or a vehicular
parking ratio pursuant to this section, is within one-half mile of any point on the property on which a major
transit stop is located, including any parking lot owned by the transit authority or other local agency operating the major transit stop.
(3) “Major transit stop” has the same meaning as
defined in subdivision (b) of Section 21155 of the Public Resources Code.
(4) “Maximum allowable residential density” means the
density allowed under the zoning ordinance and land
use element of the general plan, or, if a range of density is permitted, means the maximum allowable density
for the specific zoning range and land use element of
the general plan applicable to the project. If the density allowed under the zoning ordinance is inconsistent with the density allowed under the land use element of the
general plan, the general plan density shall prevail.
(p) (1) Except as provided in paragraphs (2), (3), and
(4), upon the request of the developer, a city, county, or city and county shall not require a vehicular parking
ratio, inclusive of parking for persons with a disability and guests, of a development meeting the criteria of
subdivisions (b) and (c), that exceeds the following
ratios:
(A) Zero to one bedroom: one onsite parking space.
(B) Two to three bedrooms: one and one-half onsite
parking spaces.
(C) Four and more bedrooms: two and one-half parking
spaces.
(2) (A) Notwithstanding paragraph (1), if a
development includes at least 20 percent low-income
units for housing developments meeting the criteria of
subparagraph (A) of paragraph (1) of subdivision (b)
or at least 11 percent very low income units for housing developments meeting the criteria of subparagraph
(B) of paragraph (1) of subdivision (b), is located within one-half mile of a major transit stop, and there is
unobstructed access to the major transit stop from the
development, then, upon the request of the developer,
a city, county, or city and county shall not impose a
vehicular parking ratio, inclusive of parking for persons with a disability and guests, that exceeds 0.5 spaces
per unit.
(B) For purposes of this subdivision, a development
shall have unobstructed access to a major transit stop
if a resident is able to access the major transit stop
without encountering natural or constructed
impediments. For purposes of this subparagraph,
“natural or constructed impediments” includes, but is
not limited to, freeways, rivers, mountains, and bodies of water, but does not include residential structures,
shopping centers, parking lots, or rails used for transit. (3) Notwithstanding paragraph (1), if a development
consists solely of rental units, exclusive of a manager’s unit or units, with an affordable housing cost to lower income families, as provided in Section 50052.5 of the
Health and Safety Code, then, upon the request of the
developer, a city, county, or city and county shall not impose vehicular parking standards if the development
meets either of the following criteria:
(A) The development is located within one-half mile of a major transit stop and there is unobstructed access to
the major transit stop from the development.
(B) The development is a for-rent housing development
for individuals who are 62 years of age or older that
complies with Sections 51.2 and 51.3 of the Civil Code
and the development has either paratransit service or
unobstructed access, within one-half mile, to fixed bus route service that operates at least eight times per day. (4) Notwithstanding paragraphs (1) and (8), if a
development consists solely of rental units, exclusive
of a manager’s unit or units, with an affordable housing cost to lower income families, as provided in Section
50052.5 of the Health and Safety Code, and the
development is either a special needs housing
development, as defined in Section 51312 of the Health
and Safety Code, or a supportive housing
development, as defined in Section 50675.14 of the
Health and Safety Code, then, upon the request of the
developer, a city, county, or city and county shall not impose any minimum vehicular parking requirement. A
development that is a special needs housing
development shall have either paratransit service or
unobstructed access, within one-half mile, to fixed bus route service that operates at least eight times per day. (5) If the total number of parking spaces required for a development is other than a whole number, the number
shall be rounded up to the next whole number. For
purposes of this subdivision, a development may
provide onsite parking through tandem parking or Page 112 of 267 22 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 uncovered parking, but not through onstreet parking.
(6) This subdivision shall apply to a development that
meets the requirements of subdivisions (b) and (c),
but only at the request of the applicant. An applicant
may request parking incentives or concessions beyond
those provided in this subdivision pursuant to
subdivision (d).
(7) This subdivision does not preclude a city, county, or city and county from reducing or eliminating a parking
requirement for development projects of any type in
any location.
(8) Notwithstanding paragraphs (2) and (3), if a city,
county, city and county, or an independent consultant
has conducted an areawide or jurisdictionwide parking
study in the last seven years, then the city, county, or city and county may impose a higher vehicular parking
ratio not to exceed the ratio described in paragraph (1), based upon substantial evidence found in the parking
study, that includes, but is not limited to, an analysis of parking availability, differing levels of transit access, walkability access to transit services, the potential for shared parking, the effect of parking requirements on
the cost of market-rate and subsidized developments,
and the lower rates of car ownership for low-income
and very low income individuals, including seniors and
special needs individuals. The city, county, or city and county shall pay the costs of any new study. The city,
county, or city and county shall make findings, based
on a parking study completed in conformity with this
paragraph, supporting the need for the higher parking
ratio.
(9) A request pursuant to this subdivision shall neither reduce nor increase the number of incentives or
concessions to which the applicant is entitled pursuant to subdivision (d).
(q) Each component of any density calculation,
including base density and bonus density, resulting in
fractional units shall be separately rounded up to the
next whole number. The Legislature finds and declares
that this provision is declaratory of existing law.
(r) This chapter shall be interpreted liberally in favor of producing the maximum number of total housing units.
(s) Notwithstanding any other law, if a city, including a charter city, county, or city and county has adopted an ordinance or a housing program, or both an ordinance
and a housing program, that incentivizes the
development of affordable housing that allows for
density bonuses that exceed the density bonuses
required by the version of this section effective through December 31, 2020, that city, county, or city and county is not required to amend or otherwise update its
ordinance or corresponding affordable housing
incentive program to comply with the amendments
made to this section by the act adding this
subdivision, and is exempt from complying with the
incentive and concession calculation amendments
made to this section by the act adding this subdivision as set forth in subdivision (d), particularly
subparagraphs (C) and (D) of paragraph (2) of that
subdivision, and the amendments made to the density
tables under subdivision (f).
65915.5.

(a) When an applicant for approval to convert
apartments to a condominium project agrees to
provide at least 33 percent of the total units of the
proposed condominium project to persons and families
of low or moderate income as defined in Section 50093
of the Health and Safety Code, or 15 percent of the total units of the proposed condominium project to lower
income households as defined in Section 50079.5 of
the Health and Safety Code, and agrees to pay for the
reasonably necessary administrative costs incurred by
a city, county, or city and county pursuant to this
section, the city, county, or city and county shall either (1) grant a density bonus or (2) provide other
incentives of equivalent financial value. A city, county, or city and county may place such reasonable
conditions on the granting of a density bonus or other
incentives of equivalent financial value as it finds
appropriate, including, but not limited to, conditions
which assure continued affordability of units to
subsequent purchasers who are persons and families
of low and moderate income or lower income
households.
(b) For purposes of this section, “density bonus” means an increase in units of 25 percent over the number of
apartments, to be provided within the existing structure or structures proposed for conversion.
(c) For purposes of this section, “other incentives of
equivalent financial value” shall not be construed to
require a city, county, or city and county to provide cash transfer payments or other monetary compensation
but may include the reduction or waiver of
requirements which the city, county, or city and county might otherwise apply as conditions of conversion
approval.
(d) An applicant for approval to convert apartments to
a condominium project may submit to a city, county, or
city and county a preliminary proposal pursuant to this section prior to the submittal of any formal requests for subdivision map approvals. The city, county, or city and county shall, within 90 days of receipt of a written
proposal, notify the applicant in writing of the
manner in which it will comply with this section. The
city, county, or city and county shall establish
procedures for carrying out this section, which shall
include legislative body approval of the means of
compliance with this section. Page 113 of 267
MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 23 (e) Nothing in this section shall be construed to require a city, county, or city and county to approve a proposal to convert apartments to condominiums.
(f) An applicant shall be ineligible for a density bonus or other incentives under this section if the apartments proposed for conversion constitute a housing
development for which a density bonus or other
incentives were provided under Section 65915.
(g) An applicant shall be ineligible for a density bonus or any other incentives or concessions under this
section if the condominium project is proposed on any
property that includes a parcel or parcels on which
rental dwelling units are or, if the dwelling units have been vacated or demolished in the five-year period
preceding the application, have been subject to a
recorded covenant, ordinance, or law that restricts
rents to levels affordable to persons and families of
lower or very low income; subject to any other form of
rent or price control through a public entity’s valid exercise of its police power; or occupied by lower or very low income households, unless the proposed
condominium project replaces those units, as defined
in subparagraph (B) of paragraph (3) of subdivision (c) of Section 65915, and either of the following applies:
(1) The proposed condominium project, inclusive of the
units replaced pursuant to subparagraph (B) of
paragraph (3) of subdivision (c) of Section 65915,
contains affordable units at the percentages set forth in subdivision (a).
(2) Each unit in the development, exclusive of a
manager’s unit or units, is affordable to, and occupied by, either a lower or very low income household.
(h) Subdivision (g) does not apply to an applicant
seeking a density bonus for a proposed housing
development if their application was submitted to, or
processed by, a city, county, or city and county before January 1, 2015.
65915.7.

(a) When an applicant for approval of a commercial
development has entered into an agreement for
partnered housing described in subdivision (c) to
contribute affordable housing through a joint project or two separate projects encompassing affordable
housing, the city, county, or city and county shall grant to the commercial developer a development bonus as
prescribed in subdivision (b).Housing shall be
constructed on the site of the commercial development
or on a site that is all of the following:
(1) Within the boundaries of the local government.
(2) In close proximity to public amenities including
schools and employment centers.
(3) Located within one-half mile of a major transit stop, as defined in subdivision (b) of Section 21155 of the
Public Resources Code.
(b) The development bonus granted to the commercial
developer shall mean incentives, mutually agreed upon
by the developer and the jurisdiction, that may include, but are not limited to, any of the following:
(1) Up to a 20-percent increase in maximum allowable
intensity in the General Plan.
(2) Up to a 20-percent increase in maximum allowable
floor area ratio.
(3) Up to a 20-percent increase in maximum height
requirements.
(4) Up to a 20-percent reduction in minimum parking
requirements.
(5) Use of a limited-use/limited-application elevator for upper floor accessibility.
(6) An exception to a zoning ordinance or other land
use regulation.
(c) For the purposes of this section, the agreement for partnered housing shall be between the commercial
developer and the housing developer, shall identify how the commercial developer will contribute affordable
housing, and shall be approved by the city, county, or
city and county.
(d) For the purposes of this section, affordable housing may be contributed by the commercial developer in
one of the following manners:
(1) The commercial developer may directly build the
units.
(2) The commercial developer may donate a portion
of the site or property elsewhere to the affordable
housing developer for use as a site for affordable
housing.
(3) The commercial developer may make a cash
payment to the affordable housing developer that shall
be used towards the costs of constructing the
affordable housing project.
(e) For the purposes of this section, subparagraph (A)
of paragraph (3) of subdivision (c) of Section 65915
shall apply.
(f) Nothing in this section shall preclude any additional allowances or incentives offered to developers by local governments pursuant to law or regulation.
(g) If the developer of the affordable units does not Page 114 of 267 24 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 commence with construction of those units in
accordance with timelines ascribed by the agreement
described in subdivision (c), the local government may
withhold certificates of occupancy for the commercial
development under construction until the developer
has completed construction of the affordable units.
(h) In order to qualify for a development bonus under
this section, a commercial developer shall partner with a housing developer that provides at least 30 percent
of the total units for low-income households or at least 15 percent of the total units for very low-income
households.
(i) Nothing in this section shall preclude an
affordable housing developer from seeking a density
bonus, concessions or incentives, waivers or reductions of development standards, or parking ratios under
Section 65915.
(j) A development bonus pursuant to this section shall
not include a reduction or waiver of the requirements
within an ordinance that requires the payment of a fee
by a commercial developer for the promotion or
provision of affordable housing.
(k) A city or county shall submit to the Department of
Housing and Community Development, as part of the
annual report required by Section 65400, information
describing a commercial development bonus approved
pursuant to this section, including the terms of the
agreements between the commercial developer and
the affordable housing developer, and the developers
and the local jurisdiction, and the number of affordable units constructed as part of the agreements.
(l) For purposes of this section, “partner” shall mean
formation of a partnership, limited liability company,
corporation, or other entity recognized by the state in which the commercial development applicant and the
affordable housing developer are each partners,
members, shareholders or other participants, or a
contract or agreement between a commercial
development applicant and affordable housing
developer for the development of both the commercial
and the affordable housing properties.
(m) This section shall remain in effect only until
January 1, 2022, and as of that date is repealed.
65916.

Where there is a direct financial contribution to a
housing development pursuant to Section 65915
through participation in cost of infrastructure,
write-down of land costs, or subsidizing the cost of
construction, the city, county, or city and county shall assure continued availability for low- and moderateincome units for 30 years. When appropriate, the agreement provided for in Section 65915 shall specify
the mechanisms and procedures necessary to carry
out this section.
65917.

In enacting this chapter it is the intent of the
Legislature that the density bonus or other incentives
offered by the city, county, or city and county pursuant to this chapter shall contribute significantly to the
economic feasibility of lower income housing in
proposed housing developments. In the absence of an
agreement by a developer in accordance with Section
65915, a locality shall not offer a density bonus or any other incentive that would undermine the intent of this chapter.
65917.2.

(a) As used in this section, the following terms shall
have the following meanings:
(1) “Eligible housing development” means a
development that satisfies all of the following criteria:
(A) The development is a multifamily housing
development that contains five or more residential
units, exclusive of any other floor area ratio bonus
or incentive or concession awarded pursuant to this
chapter.
(B) The development is located within one of the
following:
(i) An urban infill site that is within a transit priority area.
(ii) One-half mile of a major transit stop.
(C) The site of the development is zoned to allow
residential use or mixed-use with a minimum planned
density of at least 20 dwelling units per acre and does not include any land zoned for low density residential
use or for exclusive nonresidential use.
(D) The applicant and the development satisfy the
replacement requirements specified in subdivision (c)
of Section 65915.
(E) The development includes at least 20 percent of the units, excluding any additional units allowed under a
floor area ratio bonus or other incentives or
concessions provided pursuant to this chapter, with an
affordable housing cost or affordable rent to, and
occupied by, persons with a household income equal to
or less than 50 percent of the area median income, as
determined pursuant to Section 50093 of the Health
and Safety Code, and subject to an affordability
restriction for a minimum of 55 years.
(F) The development complies with the height Page 115 of 267 requirements applicable to the underlying zone. A
development shall not be eligible to use a floor area
ratio bonus or other incentives or concessions provided pursuant to this chapter to relieve the development
from a maximum height limitation.
(2) “Floor area ratio” means the ratio of gross
building area of the eligible housing development,
excluding structured parking areas, proposed for the
project divided by the net lot area. For purposes of this paragraph, “gross building area” means the sum of all
finished areas of all floors of a building included within the outside faces of its exterior walls.
(3) “Floor area ratio bonus” means an allowance for an
eligible housing development to utilize a floor area ratio over the otherwise maximum allowable density
permitted under the applicable zoning ordinance
and land use elements of the general plan of a city or
county, calculated pursuant to paragraph (2) of
subdivision (b).
(4) “Major transit stop” has the same meaning as
defined in Section 21155 of the Public Resources Code.
(5) “Transit priority area” has the same meaning as
defined in Section 21099 of the Public Resources Code.
(b) (1) A city council, including a charter city council or the board of supervisors of a city and county, or county board of supervisors may establish a procedure by
ordinance to grant a developer of an eligible housing
development, upon the request of the developer, a floor area ratio bonus, calculated as provided in paragraph
(2), in lieu of a density bonus awarded on the basis of dwelling units per acre.
(2) In calculating the floor area ratio bonus pursuant to this section, the allowable gross residential floor area in square feet shall be the product of all of the following amounts:
(A) The allowable residential base density in dwelling
units per acre.
(B) The site area in square feet, divided by 43,560.
(C) 2,250.
(c) The city council or county board of supervisors
shall not impose any parking requirement on an eligible housing development in excess of 0.1 parking spaces
per unit that is affordable to persons and families with a household income equal to or less than 120 percent
of the area median income and 0.5 parking spaces per
unit that is offered at market rate.
(d) A city or county that adopts a floor area ratio bonus ordinance pursuant to this section shall allow an
applicant seeking to develop an eligible residential
development to calculate impact fees based on square
feet, instead of on a per unit basis.
(e) In the case of an eligible housing development that is zoned for mixed-use purposes, any floor area ratio
requirement under a zoning ordinance or land use
element of the general plan of the city or county
applicable to the nonresidential portion of the eligible housing development shall continue to apply
notwithstanding the award of a floor area ratio bonus in accordance with this section.
(f) An applicant for a floor area ratio bonus pursuant to this section may also submit to the city, county, or city and county a proposal for specific incentives or
concessions pursuant to subdivision (d) of Section
65915.
(g) (1) This section shall not be interpreted to do either of the following:
(A) Supersede or preempt any other section within this
chapter.
(B) Prohibit a city, county, or city and county from
providing a floor area ratio bonus under terms that are different from those set forth in this section.
(2) The adoption of an ordinance pursuant to this
section shall not be interpreted to relieve a city, county, or city and county from complying with Section 65915.
65917.5.

(a) As used in this section, the following terms shall
have the following meanings:
(1) “Child care facility” means a facility installed,
operated, and maintained under this section for the
nonresidential care of children as defined under
applicable state licensing requirements for the facility. (2) “Density bonus” means a floor area ratio bonus over the otherwise maximum allowable density permitted
under the applicable zoning ordinance and land use
elements of the general plan of a city, including a
charter city, city and county, or county of:
(A) A maximum of five square feet of floor area for each one square foot of floor area contained in the child care facility for existing structures.
(B) A maximum of 10 square feet of floor area for each
one square foot of floor area contained in the child care facility for new structures.

For purposes of calculating the density bonus under
this section, both indoor and outdoor square footage
requirements for the child care facility as set forth in applicable state child care licensing requirements shall MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021 25

be included in the floor area of the child care facility. (3) “Developer” means the owner or other person,
including a lessee, having the right under the applicable zoning ordinance of a city council, including a charter city council, city and county board of supervisors, or
county board of supervisors to make an application for
development approvals for the development or
redevelopment of a commercial or industrial project.
(4) “Floor area” means as to a commercial or industrial project, the floor area as calculated under the
applicable zoning ordinance of a city council, including a charter city council, city and county board of
supervisors, or county board of supervisors and as to a child care facility, the total area contained within the exterior walls of the facility and all outdoor areas
devoted to the use of the facility in accordance with
applicable state child care licensing requirements.
(b) A city council, including a charter city council, city and county board of supervisors, or county board of
supervisors may establish a procedure by ordinance to
grant a developer of a commercial or industrial project, containing at least 50,000 square feet of floor area,
a density bonus when that developer has set aside at
least 2,000 square feet of floor area and 3,000
outdoor square feet to be used for a child care
facility. The granting of a bonus shall not preclude a city council, including a charter city council, city and county board of supervisors, or county board of supervisors
from imposing necessary conditions on the project or
on the additional square footage. Projects constructed
under this section shall conform to height, setback, lot coverage, architectural review, site plan review, fees, charges, and other health, safety, and zoning
requirements generally applicable to construction in
the zone in which the property is located. A consortium with more than one developer may be permitted to
achieve the threshold amount for the available density
bonus with each developer’s density bonus equal to the
percentage participation of the developer. This facility may be located on the project site or may be located
offsite as agreed upon by the developer and local
agency. If the child care facility is not located on the site of the project, the local agency shall determine whether the location of the child care facility is appropriate and whether it conforms with the intent of this section. The child care facility shall be of a size to comply with all state licensing requirements in order to accommodate
at least 40 children.
(c) The developer may operate the child care facility
itself or may contract with a licensed child care
provider to operate the facility. In all cases, the
developer shall show ongoing coordination with a local
child care resource and referral network or local
governmental child care coordinator in order to qualify for the density bonus.
(d) If the developer uses space allocated for child care facility purposes, in accordance with subdivision (b), for purposes other than for a child care facility, an
assessment based on the square footage of the
project may be levied and collected by the city council, including a charter city council, city and county board of supervisors, or county board of supervisors. The
assessment shall be consistent with the market value
of the space. If the developer fails to have the space
allocated for the child care facility within three years, from the date upon which the first temporary
certificate of occupancy is granted, an assessment
based on the square footage of the project may be
levied and collected by the city council, including a
charter city council, city and county board of
supervisors, or county board of supervisors in
accordance with procedures to be developed by the
legislative body of the city council, including a charter city council, city and county board of supervisors, or
county board of supervisors. The assessment shall
be consistent with the market value of the space. A
penalty levied against a consortium of developers shall be charged to each developer in an amount equal to
the developer’s percentage square feet participation.

Funds collected pursuant to this subdivision shall be
deposited by the city council, including a charter city council, city and county board of supervisors, or county board of supervisors into a special account to be used
for child care services or child care facilities.
(e) Once the child care facility has been established,
prior to the closure, change in use, or reduction in the physical size of, the facility, the city, city council, including a charter city council, city and county board of supervisors, or county board of supervisors shall be required to make a finding that the need for child care is no longer present, or is not present to the same
degree as it was at the time the facility was established. (f) The requirements of Chapter 5 (commencing with
Section 66000) and of the amendments made to
Sections 53077, 54997, and 54998 by Chapter 1002 of
the Statutes of 1987 shall not apply to actions taken in accordance with this section.
(g) This section shall not apply to a voter-approved
ordinance adopted by referendum or initiative.
65918.

The provisions of this chapter shall apply to charter
cities.
26 MEYERS NAVE A professional law corporation | CALIFORNIA DENSITY BONUS LAW 2021

2343607.1 14537.034
January 31, 2023
State Department of Housing and Community Development
C/O Land Use and Planning Unit
2020 W. El Camino Ave, Suite 500
Sacramento, CA 95833
[email protected]
Re: Town of Atherton Adopted Housing Element
Please find herein the Town of Atherton’s Housing Element for the 2023-31 period (Sixth Cycle). The City Council found that the Housing Element substantial complies with Housing Element laws, and on that basis, certified and adopted the Housing Element on January 31, 2023 and directed staff to submit the document to the State. The Town believes that it has made a good faith effort to address the Regional Housing Needs Allocation with a creative yet comprehensive plan that considers the uniqueness of this community.

Atherton is a 100% built-out community with limited needs and resources. Plus, property owners have unequivocally expressed that they will neither sell their property nor develop them into multifamily lots. However, they committed to the construction of Senate Bill 9 lots (and the Town has received much interest) and Accessory Dwelling Units (with the Town seeing actual ADUs being built and requests for more). Based on this untenable position, but mindful of its obligations to plan for its RHNA, the Town found that upzoning existing, built-out, properties would not result in those properties actually being developed into multifamily units. Unlike other communities, the Town also has extremely limited public property, all of which is either built out (civic center, police station, small corporation yard) or gifted to it and under deed restrictions for use (Holbrook-Palmer park). In other words, planning for Atherton's RHNA is incomparable to other communities and required creative solutions.

As such, the 6th Cycle Housing Element addresses the identified needs of the community using upzoning in portions of the Town where property owners have expressed interest, along with a combination of accessory dwelling units, lot splits pursuant to Senate Bill 9, vacant lot development.

This solution provides a distributed approach in a way that best prevents segregation, racial or ethnic concentration of housing, or results in a disparate impact to access or opportunities for housing.

Specifically, the adopting Housing Element implements goals, policies and programs to incentivize and promote adequate housing opportunities for people at all income levels. For example, it includes:
• Upzoning at Menlo College to allow affordable housing for students and teachers. The college has committed to a "centennial campaign" that is already underway and states that local donors have committed to contributing the necessary funds to actually design a four story 40-60 unit multifamily complex. (See Appendix 6). This demonstrates not just planning for additional housing, but seeking commitments to effectuate its construction; Town of Atherton
Office of the City Manager
80 Fair Oaks Lane
Atherton, California 94027
Phone: (650) 752-0500

2343607.1 14537.034
• Upzoning at 23 Oakwood to allow 10 dwelling units/acre with a 20% affordability requirement to result in the construction of up to 16 new units. (See, Housing Element at p. 68-69).

Furthermore, similar to Menlo College, the Town obtained a willingness and commitment from the property owner to actually develop. (See Appendix 7); • Local policies to incentivize ADU development and rental programs to facilitate affordable housing, including, but not limited to, partnering with HIP housing, allowing multiple ADUs on parcels that are at least 2 acres, and offering fee reductions; • Streamline the construction of affordable housing by offered an expedited review process • Adopting an affordable housing fee, which fees will be used to provide rental assistance for very-low income housing.

To comply with public participation requirements pursuant to AB 215 (Chapter 342, Statutes of 2021), a draft of this document was made available for public comment on January 23, 2023 with copies provided to individuals and organization who previously requested copies. The draft was posted on the Town’s website and physical copies made available at Town Hall and the Library. The Town exceeded the minimum public participation requirements by establishing additional workshops, community meetings, and multiple public hearings to solicit public comment. The Housing Element was promoted via the Town’s email newsletter, public notices posted at the Town Center, public notification in the newspaper, email outreach to interested parties, and physical mailings to affected properties. The Atherton City Council reviewed public comments received during the public review period at its January 31, 2023 meeting, directed specific modifications in response to public comments, and authorized transmittal of the then adopted and certified Housing Element to HCD. The final version of the Housing Element has also been posted on the website with copies provided to interested parties.

Thank you for your time and attention in reviewing this document.

George Rodericks, City Manager
[email protected]
(650) 752-0504

Town of Atherton 2023-2031 Housing Element – DRAFT 1
January 2023
Table of Contents

3.100 INTRODUCTION

3.110 Purpose of the Housing Element 4

3.120 Definition of Income Categories 4

3.130 RHNA (Regional Housing Needs Allocation) 2023- 2031 6

3.140 Relation to Other Elements (including General Plan Consistency Analysis) 6

3.200 ASSESSMENT OF HOUSING NEEDS

3.210 Housing Needs Detailed Analysis 7

3.300 ATHERTON FAIR HOUSING ASSESSMENT

3.310 Introduction – What is Fair Housing? 12

3.320 Section Content and Organization 16

3.330 Fair Housing Enforcement and Outreach Capacity 19

3.340 Integration and Segregation 23

3.350 Access to Opportunity 28

3.360 Disparate Housing Needs 34

3.370 Site Inventory Analysis 40

3.380 Contributing Factors and Fair Housing Action Plan 40

3.400 HOUSING RESOURCES

3.410 Inventory of Sites Suitable for Residential Development 42

3.420 Analysis of Zoning that Encourages and Facilitates a Variety of Housing Types 49

3.430 Identification of Adequate Sites for Emergency Shelters 50

3.440 Identification of Adequate Sites for Transitional and Supportive Housing 50

Town of Atherton 2023-2031 Housing Element – DRAFT 2
January 2023

3.450 Identification of Adequate Sites for Farm Worker Housing 50

3.460 Other Housing Resources 50

3.500 CONSTRAINTS ON HOUSING

3.510 Governmental Constraints Analysis 51

3.520 Non-Governmental Constraints Analysis 58

3.600 REVIEW OF 2015-22 HOUSING ELEMENT PERFORMANCE

3.610 Effectiveness of the Element 60

3.620 Progress in Implementation 60

3.630 Future Opportunities 61

3.700 HOUSING GOALS, QUANTIFIED OBJECTIVES AND POLICIES

3.710 GOAL: FACILITATE THE PRIVATE DEVELOPMENT OF HOUSING TO MEET A PORTION OF THE ABOVE MODERATE INCOME HOUSING NEED IDENTIFIED FOR ATHERTON 68

3.720 GOAL: USE ACCESSORY DWELLING UNITS TO MEET A SUBSTANTIAL PORTION OF THE TOWN’S MODERATE TO VERY LOW-INCOME HOUSING NEED. 68

3.730 GOAL: FACILITATE THE DEVELOPMENT OF FACULTY AND STUDENT HOUSING ON

SCHOOL CAMPUSES TO MEET A PORTION OF THE MODERATE AND VERY LOW-INCOME HOUSING NEED IDENTIFIED FOR ATHERTON 68
69 3.750 GOAL: PROMOTE PRIVATE EFFORTS TO CONSERVE AND IMPROVE ATHERTON’S EXISTING HOUSING SUPPLY. 69

3.760 GOAL: ENCOURAGE SPECIAL CONSIDERATION TO THE MAINTENANCE AND EXPANSION

OF HOUSING OPPORTUNITIES FOR HANDICAPPED AND LOW AND MODERATE INCOME AND HOMELESS PERSONS. 69

3.770 GOAL: MEET THE NEEDS OF SENIORS, IN LIGHT OF THE PENDING GROWTH OF THIS POPULATION IN SAN MATEO COUNTY. 70

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3.780 GOAL: CONTINUE TO PROMOTE HOUSING OPPORTUNITIES FOR ALL PERSONS

REGARDLESS OF RACE, SEX, MARITAL STATUS, ANCESTRY, NATIONAL ORIGIN OR COLOR 71 3.790 GOAL: SUPPORT EFFORTS TO AFFIRMATIVELY FURTHER FAIR HOUSING IN ATHERTON. 71

3.800 HOUSING PROGRAMS

3.810 New Construction, Conservation and Rehabilitation 74

3.820 Special Housing Needs 83

3.830 Consistency with State Requirements 86

3.840 Other Housing Programs 86

3.900 EFFORTS TO ACHIEVE COMMUNITY ENGAGEMENT 88
APPENDICES 91

1. 21 Elements Resident Survey Analysis, 4/14/2022

2. ABAG/MTC Housing Needs Data Report - Atherton

3. AFFH Atherton Map and Data Packet

4. San Mateo County-wide Housing Needs Final Report, 11/3/2021

5. Electronic Housing Element Site Inventory Form

6. Menlo College Faculty and Staff Housing Considerations

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3.000 HOUSING ELEMENT (2023-2031 UPDATE)

3.100 INTRODUCTION

3.110 Purpose of the Housing Element
The State of California Government Code1 requires that all cities within the San Francisco Bay Area update the Housing Element of their General Plan by January 31, 2023. The purpose of this document is to meet this requirement by evaluating the existing and projected housing needs of all economic segments of Atherton, evaluating existing policies and programs aimed at the preservation, improvement and development of housing and where appropriate, identifying new priorities.

The contents of this update include an analysis of housing needs, statements of goals and policies, a schedule of programs and actions and an estimate of the number of housing units the Town expects to be developed, improved and maintained in the local housing stock. Programs and policies included in the existing Housing Element were evaluated and modified where necessary to reflect changing market conditions and policy priorities.

Atherton is a residential community of approximately 7,200 residents with a land area of approximately six square miles. The Town is bordered by Menlo Park, Woodside, Redwood City and unincorporated San Mateo County. Founded in the early 1920’s, Atherton is characterized by large lot residential land use, where minimum lot size is 1/3 to 1 acre throughout the Town. There is no commercial or industrial land use in Atherton.

There are eight schools in Town, three of which are private.

3.120 Definition of Income Categories
Since the determination of housing need is often discussed in terms of income categories, it is important to define the categories used in this update at the outset. The California Department of Housing and Community Development (HCD) has established household income categories based on a proportion of the area’s median family income as summarized below:

TABLE HE-1: HCD INCOME CATEGORIES DEFINED
Income Category Definitions
Acutely Low 0 – 15% of area median income
Extremely Low 15% - 30% of area median income
Very Low 30%-50% of area median income
1 § 65588(e)(2)

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Lower2 50%-80% of area median income
Moderate 80%-120% of area median income
Above Moderate Above 120% of area median income
The income limits established by HCD for San Mateo County in 2021 are presented in Table HE-2.

TABLE HE-2: ANNUAL INCOME LIMITS BY HOUSEHOLD SIZE - 2021(US$) San Mateo County Income Limits (2021) (
Number of Persons Per Household
(Maximum Income)
Income Category 1 2 3 4 5
Extremely Low $38,400 $43,850 $49,350 $54,800 $59,200
Very Low $63,950 $73,100 $82,250 $91,350 $98,700
Low Income $102,450 $117,100 $131,750 $146,350 $158,100 Median Income $104,700 $119,700 $134,650 $149,600 $161,550 Moderate Income $125,650 $143,600 $161,550 $179,500 $193,850 Source: HCD State Income Limits 2021 and State CDBG and HOME Income Limits.

TABLE HE-3: MONTHLY MAXIMUM AFFORDABLE HOUSING COST BY HOUSEHOLD SIZE – 2021 (US$)
San Mateo County Income Limits (2021)
Number of Persons Per Household
(Maximum Income)
Income Category 1 2 3 4 5
Extremely Low $960 $1,096 $1,234 $1,370 $1,480
Very Low $1,599 $1,828 $2,056 $2,284 $2,468
Low Income $2,561 $2,928 $3,294 $3,659 $3,953
Median Income $2,618 $2,993 $3,366 $3,740 $4,039
Moderate Income $3,141 $3,590 $4,039 $4,388 $4,846
Source: HCD State Income Limits 2013 and State CDBG and HOME Income Limits. 2 Term may also be used to mean 0% - 80% of AMI

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3.130 RHNA (Regional Housing Needs Allocation) 2023 - 2031 (6th Cycle) The Regional Housing Needs Allocation in the Bay Area is a process managed by ABAG (Association of Bay Area Governments) and MTC (Metropolitan Transportation Commission), whereby the housing needs for the Bay Area are distributed to the various County and city jurisdictions. The 2023 - 2031 period is the 6th RHNA cycle since the beginning of the process. The Town of Atherton has been assigned the allocations by income category, listed below for this cycle:

Very Low Income 94 dwelling units
Low Income 54 dwelling units
Moderate Income 56 dwelling units
Above Moderate Income 144 dwelling units

3.140 Relation to Other Elements (including General Plan Consistency Analysis) The Housing Element is closely related to the Land Use, Open Space and Circulation Elements. In the Housing Element, residential land use is translated into terms of household units to be accommodated in the future. Lands designated for residential use are identified in the Land Use Element; the location, site area and terrain suitable for housing is related to both open space and land use; and the capability of serving residential neighborhoods by an efficient circulation system is discussed in the Circulation Element.

State law requires that all elements of the general plan be consistent with each other.

The General Plan was reviewed to ensure that the goals and policies of this Housing Element are consistent with the other elements of the Town’s General Plan

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3.200 ASSESSMENT OF HOUSING NEEDS

3.210 Housing Needs Detailed Analysis
See Appendix for detailed Housing Needs Analysis.

3.211 Summary of Key Facts
People
● Population – Unlike the rest of the Bay Area, Atherton’s population has been declining. The Town’s population decreased by 2.3% from 2000-2020, while both the county and the Bay Area’s populations have increased (by 9% and 15% respectively). In Atherton, this has been the result of almost complete buildout of the Town in accordance with the General Plan, aging population, and policies that restrict land use to low density residential and minimum lot sizes to 1 acre or ⅓ acre. This increase throughout the region is mostly due to natural growth (births minus deaths) and a strong economy drawing new residents to the region. ● Income – Atherton has a lower percentage of lower income households than the rest of the county and region, with 17% of households earning less than 80% of the Area Median Income (AMI)3 compared to 40% of households in San Mateo County and 39% of households in the Bay Area as a whole. Of those that are considered lower income in Atherton, approximately 6% are considered very low-income (earning less than 50% of AMI) and 6.5% are considered extremely low income (earning less than 30% of AMI).
● Age – Community members in Atherton are overall older than they were in the past. The median age has increased from 45.2 in 2000 to 47 in 2019. In 2019, 22.3% of the population was under 18 and 22.4% was over 65.
● Race/Ethnicity – Atherton is less diverse than the Bay Area as a whole. In 2019, 69% of the population was White, 21% was Asian, 4.4% was Latinx, and 0.8% was African American (see chart).
● Poverty – Currently, people of color in San Mateo County are more likely to experience poverty. The group with the highest poverty rate in Atherton is 3 The Area Median Income is the middle spot between the lowest and highest incomes earned.

The AMI for the county is $104,700 for a single person, $119,700 for a household of two and $149,600 for a family of four.

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Asian/Pacific Islander residents (5.3%). White (Hispanic and Non-Hispanic) residents have the lowest poverty rate (3.5%).4
Source: U.S. Census Bureau, American Community Survey
5-Year Data (2015-2019), Table B03002.

Jobs
● Employment – Generally, having a similar number of jobs and employed residents produces more benefits for a community, such as reducing traffic and climate impacts, and allowing people who work in the community to also live there. San Mateo County is job rich, meaning it has more jobs than employed residents.

In contrast, Atherton is job poor. Based on ABAG/MTC data, of 7,200 residents there are 2,870 employed residents and 2,726 jobs5 in Atherton, resulting in a jobsto-resident-workers ratio of 0.95. However, the estimation of jobs likely includes commercial enterprises within the nearby County-unincorporated area as the Town has no commercial land use. The Town believes that a more accurate number for jobs in Atherton is far less and has advised ABAG/MTC of this concern during each Plan Bay Area review. Actual jobs with physical locations in Atherton are limited to Town employees, public and private school employees, country club employees and CalWater employees. There are, however, a number of service industry jobs that are located in Atherton, such as construction, delivery, and household. Unfortunately there is no data readily available to more accurately represent local jobs.
4Some demographic groups do not have reported poverty rates or may have over/underestimated rates as a result of having a limited sample for the particular group. 5 Employed residents in a jurisdiction are counted by place of residence (they may work elsewhere) while jobs in a jurisdiction are counted by place of work (they may live elsewhere).

American
Indian or Alaska
Native, NonHispanic
0%
Asian / API, NonHispanic
21%
Black or African
American, NonHispanic
White, Non- 1%
Hispanic
69%
Other Race or
Multiple Races,
Non-Hispanic
5%
Hispanic or
Latinx
4%
Population by Race, 2019

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● Unemployment – Jurisdictions throughout the region experienced a sharp rise in unemployment in 2020 due to impacts related to the COVID-19 pandemic, though with a general improvement and recovery in the later months of 2020. As of January 2021, Atherton’s unemployment rate was 6.1%, which was slightly lower than the regional unemployment rate of 6.6% and much lower than its pandemicrelated high rate of 14.6% in April 2020. Atherton’s pre-pandemic unemployment rate was 2.8% (January 2020). (Source: California Employment Development Department, Local Area Unemployment Statistics (LAUS), Sub-county areas monthly updates, 2010-2021).

Housing and Households
● New Homes Built – The number of new homes built in the Bay Area has not kept pace with the demand, resulting in longer commutes, increasing prices, and exacerbating issues of displacement and homelessness. The number of homes constructed in Atherton decreased 1% from 2010 to 2020, which is below the growth rate for San Mateo County and below the housing growth rate of the region’s housing stock during this period (4% and 5% respectively). ● Home Prices and Rents –
Housing prices in Atherton are
not seen as affordable to most
residents and workers in the
region. Given high job growth
and low housing growth in the
county, the cost of housing in
Atherton has increased
significantly in the past decade:
o Sales Price – In 2020, the average sales price of a single-family home in Atherton was approximately $7,897,800. Home prices increased by 196% from 2010 to 2020.6
o Rental Prices – Rental prices increased by 60% from 2009 to 2019. The median rent in 2019 was $3,200. To rent a typical apartment without cost burden, a household would need to make $128,320 per year.7 6 San Mateo Association of REALTORS Annual Reports 2010-2020 7 Note that contract rents may differ significantly from, and often being lower than, current listing prices.
$1,000,000
$3,000,000
$5,000,000
$7,000,000
$9,000,000
$11,000,000
20102011201220132014201520162017201820192020
Atherton Average Home Sales Price

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● Housing Type – In 2020, 98% of homes in Atherton were single family detached, 2% were single family attached, 0.2% were small multifamily (2-4 units), and 0% were medium or large multifamily (5+ units). Atherton’s housing consists of more detached single-family homes than the region as a whole (98% as compared to 52% in the Bay Area).
● Housing for Large Families - Large families are generally served by homes with 3 or more bedrooms, of which there are 2,093 units in Atherton (94% of the housing).

Among these 3+ bedroom units, 6% are renter-occupied and 94% are owneroccupied. ● Cost Burden – The U.S. Department of Housing and Urban Development (HUD) considers housing to be affordable for a household if the household spends less than 30% of its income on housing costs. A household is considered “costburdened” if it spends more than 30% of its monthly income on housing costs.

Those who spend more than 50% of their income on housing costs are considered “severely cost-burdened.” In Atherton, 14% of households are cost burdened, while an additional 18% of households are severely cost burdened. ● Neighborhood Equity – Some neighborhoods are identified as “Highest Resource” or “High Resource” by the State of California based on a range of indicators such as access to community resources–quality schools, proximity to jobs and economic opportunities, low pollution levels, and other factors.8 Neighborhoods do not always receive an equitable share of these community resources and may be designated as “Low Resource” if they lack these amenities. Approximately 40% of residents in Atherton live in neighborhoods identified as “Highest Resource” or “High Resource”, while no residents live in areas identified by this research as “Low Resource”.
● Displacement & Gentrification – Displacement, or the inability of residents to afford to remain in their homes, is a major concern in the Bay Area due to increasing housing prices. Displacement has the most severe impacts on low- and moderateincome residents. When individuals or families are forced to leave their homes and communities, they lose their support network. A related concern is the impact of gentrification or exclusion—when neighborhoods have limited or no housing opportunities for low- and moderate-income residents.
8 For more information on the “opportunity area” categories developed by HCD and the California Tax Credit Allocation Committee, see this website:
https://www.treasurer.ca.gov/ctcac/opportunity.asp.

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Low-income households are excluded from virtually all of Atherton's neighborhoods due to the high cost of land. The notable exception to this is accessory dwelling units (ADUs) and junior ADUs (JADUs) throughout town. The Town supports and encourages an active and successful home-sharing program through HIP Housing. Lastly, Menlo College provides extensive dormitory use for students that would otherwise be housed and renting affordable units off campus.

By supporting multi-family housing on campus, the Town is able to assist in opening up scarce affordable housing resources throughout the region. ● Special Housing Needs – Some population groups may have special housing needs such as mobility and accessibility barriers. For instance, individuals with disabilities are often unable to work and live off of a fixed income, such as Supplemental Security Income. They also may require accessibly designed housing to accommodate needs related to their specific disabilities. In Atherton,

7.8% of residents have a disability of any kind. While there are not any housing units in the Town that are specifically tailored to the needs of individuals with disabilities, such as supportive housing or assisted living facilities, the data appears to indicate that Town residents with disabilities are housed, typically with family members who are able to provide for their needs.

Seniors (individuals 64 years of age or older) are another segment of the population with special housing needs. As previously mentioned, 22.4% of Atherton’s population, or 1,596 individuals, were seniors in 2019. Currently, there are no senior housing units in Atherton. However, as the population of the Town continues to age, there may be a greater need for more senior housing (i.e. smaller, multifamily units, or accessible units), spurred by a growing trend by many to age-in-place or downsize to remain in their communities.

Additionally, 13% of Atherton households are larger households with five or more people, who likely need larger housing units of three bedrooms or more. Since 0% of the large households in the Town are considered very low-income and 94% of the units in the Town are three or more bedrooms, the high cost of housing in the Town has not prevented a majority of these large families from securing adequate housing.

Finally, 5.4% of households in the Town are female-headed families, which can be of greater risk of housing insecurity, or losing their home. In the Town, 7.8% of female-headed households with children and 0% of female-headed households without children, or a total of 11 households, fall below the Federal poverty line.

Development of deed-restricted affordable units may help to ensure these households are able to remain in the Town.

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3.300 ATHERTON FAIR HOUSING ASSESSMENT

3.310 Introduction – What is Fair Housing?
The State of California’s 2018 Assembly Bill (AB 686) requires that all public agencies in the state affirmatively further fair housing (AFFH) beginning January 1, 2019. Public agencies receiving funding from the U.S. Department of Housing and Urban Development (HUD) are also required to demonstrate their commitment to AFFH. The federal obligation stems from the fair housing component of the federal Civil Rights Act mandating federal fund recipients to take “meaningful actions” to address segregation and related barriers to fair housing choice. The Town does not receive HUD funding.

AB 686 requires all public agencies to “administer programs and activities relating to housing and community development in a manner that affirmatively furthers fair housing, and take no action inconsistent with this obligation”9
AB 686 also makes changes to Housing Element Law to incorporate requirements to AFFH as part of the housing element and general plan to include an analysis of fair housing outreach and capacity, integration and segregation, access to opportunity, disparate housing needs, and current fair housing practices.

Affirmatively Furthering Fair Housing
“Affirmatively furthering fair housing” means taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics. Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws. The duty to affirmatively further fair housing extends to all of a public agency’s activities and programs relating to housing and community development. (Gov. Code, § 8899.50, subd. (a)(1).)”
Source: California Department of Housing and Community Development Guidance, 2021, page 14. 9 California Department of Housing and Community Development Guidance, 2021, page 9.

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History of segregation in the region. The United
States’ oldest cities have a history of mandating
segregated living patterns—and Northern
California cities are no exception. ABAG, in its
recent Fair Housing Equity Assessment, attributes
segregation in the Bay Area to historically
discriminatory practices—highlighting redlining
and discriminatory mortgage approvals—as
well as “structural inequities” in society, and
“self-segregation” (i.e., preferences to live near
similar people). The narrative below applies
regionally and is not solely specific to the Town
of Atherton.

Researcher Richard Rothstein’s 2017 book The
Color of Law: A Forgotten History of How Our
Government Segregated America chronicles
how the public sector contributed to the
segregation that exists today. Rothstein
highlights several significant developments in
the Bay Area region that played a large role in where the region’s non-White residents settled.

Pre-civil rights San Mateo County faced resistance to racial integration, yet it was reportedly less direct than in some Northern California communities, taking the form of “blockbusting” and “steering” or intervention by public officials. These local discriminatory practices were exacerbated by actions of the Federal Housing Administration which excluded low-income neighborhoods, where the majority of people of color lived, from its mortgage loan program.

According to the San Mateo County Historical Association. San Mateo County’s early African Americans worked in a variety of industries, from logging, to agriculture, to restaurants and entertainment. Expansion of jobs, particularly related to shipbuilding during and after World War II attracted many new residents to the Peninsula, including the first sizable migration of African Americans. Enforcement of racial covenants after the war forced the migration of the county’s African Americans into neighborhoods where they were allowed to occupy housing. Typically, this housing was segregated into less desirable areas, such as next to highways, and concentrated in public housing and urban renewal developments.

This history of segregation in
the region is important not
only to understand how
residential settlement
patterns came about—but,
more importantly, to explain
differences in housing
opportunity among residents
today. In sum, not all
residents had the ability to
build housing wealth or
achieve economic
opportunity. This historically
unequal playing field in part
determines why residents
have different housing needs
today.

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The private sector contributed to segregation through activities that discouraged (blockbusting) or prohibited (restrictive covenants) integrated neighborhoods. The segregationary effect of blockbusting activities in the County is most well-documented in East Palo Alto. In 1954, after a white family in East Palo Alto sold their home to an African American family, the then-president of the California Real Estate Association set up an office in East Palo Alto to scare white families into selling their homes (“for fear of declining property values”) to agents and speculators. These agents then sold these homes at over-inflated prices to African American buyers, some of whom had trouble making their payments. Within six years, East Palo Alto—initially established with “whites only” neighborhoods—became 82% African American. The FHA prevented reintegration by refusing to insure mortgages held by white buyers residing in East Palo Alto.

Throughout the county, neighborhood associations and city leaders attempted to thwart integration of communities. Although some neighborhood residents supported integration, most did not, and it was not unusual for neighborhood associations to require acceptance of all new buyers. Builders with intentions to develop for all types of buyers (regardless of race) found that their development sites were rezoned by planning councils, required very large minimum lot sizes, and\or were denied public infrastructure to support their developments or charged prohibitively high amounts for infrastructure.

The timeline of major federal acts and court decisions related to fair housing choice and zoning and land use appears on the following page.

As shown in the timeline, exclusive zoning practices were common in the early 1900s.

Courts struck down only the most discriminatory and allowed those that would be considered today to have a “disparate impact” on classes protected by the Fair Housing Act. For example, the 1926 case Village of Euclid v. Amber Realty Co. (272 U.S. 365) supported the segregation of residential, business, and industrial uses, justifying separation by characterizing apartment buildings as “mere parasite(s)” with the potential to “utterly destroy” the character and desirability of neighborhoods. At that time, multifamily apartments were the only realistic housing options for people of color, including immigrants.

The Federal Fair Housing Act was not enacted until nearly 60 years after the first racial zoning ordinances appeared in U.S. cities. This coincided with a shift away from federal control over low-income housing toward locally-tailored approaches (block grants) and market-oriented choice (Section 8 subsidies)—the latter of which is only effective when adequate affordable rental units are available.

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Major Public and Legal Actions that Influence Fair Access to Housing

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3.320 Section Content and Organization
This Fair Housing Assessment follows the April 2021 State of California State Guidance for AFFH. The study was conducted as part of the 21 Elements process, which facilitates the completion of Housing Elements for all San Mateo County jurisdictions.

Section 3.330. Fair Housing Enforcement and Outreach Capacity reviews lawsuits, enforcement actions, and complaints against the jurisdiction; compliance with state fair housing laws and regulations; and jurisdictional capacity to conduct fair housing outreach and education.

Section 3.340. Integration and Segregation identifies areas of concentrated segregation, degrees of segregation, and the groups that experience the highest levels of segregation
Section 3.350. Access to Opportunity examines differences in access to education, transportation, economic development, and healthy environments.

Section 3.360. Disparate Housing Needs identifies which groups have disproportionate housing needs including displacement risk.

Section 3.370. Site Inventory Analysis provides an analysis of sites identified to meet RHNA obligations for their ability to affirmatively further fair housing.

Section 3.380. Contributing Factors and Fair Housing Action Plan identifies the primary factors contributing to fair housing challenges and the plan for taking meaningful actions to improve access to housing and economic opportunity.

Fair Housing Appendices
◼ Resident survey results—findings from a survey of San Mateo County residents on their experience finding and remaining in housing
◼ Disparate Access to Educational Opportunities—findings from a countywide analysis of access to education and educational outcomes by protected class. ◼ State Fair Housing Laws and Regulations—summary of key state laws and regulations related to mitigating housing discrimination and expanding housing choice
◼ Fair Housing Organizations in San Mateo County—mission, services, and contact information

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3.321 Primary Findings
This section summarizes the primary findings from the Fair Housing Assessment for Atherton including the following sections: fair housing enforcement and outreach capacity, integration and segregation, access to opportunity, disparate housing needs, and contributing factors and the town’s fair housing action plan. ◼ From 2017 to 2021, 57 fair housing complaints in San Mateo County were filed with the U.S. Department of Housing and Urban Development (HUD)—there were no complaints identified for Atherton. Compared to nearby Redwood City and Menlo Park, Atherton does not appear to have any housing stock currently used by renters with housing vouchers. The Town does not have an inventory of income assisted rental units and to our knowledge, no one has requested the use of vouchers.
◼ Atherton stands out for the income level of its residents and high ownership rates. ◼ Racial and ethnic minorities living in Atherton are wealthier compared to the county. However, in general:

Households of other or multiple races experience higher rates of cost burden—56% are extremely cost burdened, compared to 16% in Atherton overall (Figure IV-11). Lower income households are also more likely to experience housing cost burden. One out of seven households with income below 80% AMI are severely cost burdened (Figure IV-10).

Racial and ethnic minorities are more likely than non-Hispanic White households to experience overcrowding. Other races (21% of households), and Hispanic households (19%), experience the highest rates of overcrowding (Figure IV-17).

Disparities by race and ethnicity are prevalent for home mortgage applications, particularly in denial rates. Hispanic (60% denial rate) and Asian/API (29%) have the highest denial rates for mortgage loan applications in 2018 and 2019, compared to non-Hispanic White households (18%) (Figure IV-33).
◼ Population growth in Atherton since 2010 has been slower than the County’s and the town has not reached the population level it had prior to the late 1900’s (Figure IV-1). Despite the low population growth, home values accelerated since 2014 (Figure IV-5). Atherton is part of Silicon Valley and home prices have been driven by the regional economy that has generated significant value. Atherton is one of

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the region's most expensive communities. Though it is separately incorporated, its economy and home prices are largely due to regional growth and demand. ◼ However, growth in home prices has not translated to more building activity.

According to the ABAG Housing Data Workbook, the majority of the housing inventory in Atherton was constructed from 1940 to 1959, with 1,087 units built between 1940 to 1959 compared to 180 units built in 2010 or later (Figure IV-3).

However, actual Town building permit records reflect that from 2010 forward more than 320 new single-family home building permits were issued. ◼ Atherton has relatively the same share of residents with a disability compared to the county (Figure III-17). In general, residents living with a disability are more likely to be unemployed and an aging population is putting a strain on paratransit access countywide.

Regionally, unemployment is disproportionately high among residents living with a disability at 11% compared to 5% for residents without a disability in Atherton—particularly when compared to the county (Figure III-20).
◼ Atherton is served by the Menlo Park City, Redwood City, and Las Lomitas Elementary School Districts. The Town is split into thirds amongst these districts. ◼ Countywide 27% of Hispanic students met or exceeded mathematics testing standards and 40% met or exceeded English testing standards. Hispanic students in Menlo Park City Elementary, Las Lomitas Elementary, and Redwood City Elementary, which includes Atherton’s Adelante Selby Spanish Immersion School, performed better compared to the county (55%, 44%, and 34% respectively in mathematics and 62%, 65%, and 43% in English).
◼ Overall, 29% of public-school students in San Mateo County qualify for reduced lunch. This was substantially higher in Redwood City Elementary School District, where 56% of students qualify for reduced lunch which includes Atherton’s Adelante Selby Spanish Immersion School. County-wide, 20% of public-school students are English learners. Again, this rate is higher at Redwood City Elementary, where 38% of students are English learners. In contrast, the share of students who qualify for reduced lunch, are experiencing homelessness, or are English learners is lower and significantly lower at Menlo Park City Elementary and Las Lomitas Elementary, respectively, than the countywide share (Disparate Access to Educational Opportunities Appendix).

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◼ At the high school level, Sequoia Union district has the highest dropout rate in the County (10%), with dropout rates among Pacific Islander (20%), Hispanic (16%), and Black (12%) students are being higher than amongst their peers of other races and/or ethnicities (Disparate Access to Educational Opportunities Appendix).

3.330 Fair Housing Enforcement and Outreach Capacity
This section discusses fair housing legal cases and inquiries, fair housing protections and enforcement, and outreach capacity.

Fair housing legal cases and inquiries. California fair housing law extends beyond the protections in the Federal Fair Housing Act (FHA). In addition to the FHA protected classes—race, color, ancestry/national origin, religion, disability, sex, and familial status—California law offers protections for age, sexual orientation, gender identity or expression, genetic information, marital status, military or veteran status, and source of income (including federal housing assistance vouchers).

The California Department of Fair Employment in Housing (DFEH) was established in 1980 and is now the largest civil rights agency in the United States. According to their website, the DFEH’s mission is, “to protect the people of California from unlawful discrimination in employment, housing and public accommodations (businesses) and from hate violence and human trafficking in accordance with the Fair Employment and Housing Act (FEHA), Unruh Civil Rights Act, Disabled Persons Act, and Ralph Civil Rights Act”.10
DFEH receives, evaluates, and investigates fair housing complaints. DFEH plays a particularly significant role in investigating fair housing complaints against protected classes that are not included in federal legislation and therefore not investigated by HUD. DFEH’s website provides detailed instructions for filing a complaint, the complaint process, appealing a decision, and other frequently asked questions.11 Fair housing complaints can also be submitted to HUD for investigation.

Additionally, San Mateo County has a number of local enforcement organizations including Project Sentinel, the Legal Aid Society of San Mateo County, and Community Legal Services in East Palo Alto. These organizations receive funding from the County and participating jurisdictions to support fair housing enforcement and outreach and education in the County.
10 https://www.dfeh.ca.gov/aboutdfeh/
11 https://www.dfeh.ca.gov/complaintprocess/

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From 2017 to 2021, 57 fair housing complaints in San Mateo County were filed with the U.S. Department of Housing and Urban Development (HUD)—none of the complaints were in Atherton. The data below reflects complaint data submitted for the region.

Countywide, most complaints cited disability status as the bias (56%) followed by race (19%), and familial status (14%). No cause determination was found in 27 complaints followed by successful conciliation or settlement with 22 complaints. Fair housing inquiries in 2020 were submitted primarily from the City of San Mateo, Redwood City, Daly City, and Menlo Park.

Fair housing complaints filed with HUD by San Mateo County residents have been on a declining trend since 2018, when 18 complaints were filed. In 2019, complaints dropped to 5, increased to 11 in 2020, and had reached 6 by mid-2021.

Nationally, the National Fair Housing Alliance (NFHA) reported a “negligible” decrease in the number of complaints filed between 2019 and 2020. The primary bases for complaints nationally were nearly identical to San Mateo County’s: disability (55%) and race (17%). Familial status represented 8% of complaints nationally, whereas this basis comprised 14% of cases in the county.

NFHA identifies three significant trends in 2020 that are relevant for San Mateo County:
◼ First, fair lending cases referred to the Department of Justice from federal banking regulators have been declining, indicating that state and local government entities may want to play a larger role in examining fair lending barriers to homeownership.
◼ Second, NFHA identified a significant increase in the number of complaints of harassment—1,071 complaints in 2020 compared to 761 in 2019. ◼ Finally, NFHA found that 73% of all fair housing complaints in 2020 were processed by private fair housing organizations, rather than state, local, and federal government agencies—reinforcing the need for local, active fair housing organizations and increased funding for such organizations.12 There were no complaints filed against the Town. Residents in Atherton are either not confronted by housing discrimination, or, if they are, have the financial power to overcome it without filing a complaint. There are affordable housing opportunities at Menlo College for students, staff, faculty, and their families; as well as accessory 12 https://nationalfairhousing.org/2021/07/29/annual-fair-housing-report-shows-increase-inhousing-harassment/

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dwelling units throughout Town rented at affordable rates. There too, there have not been any housing complaints filed.

In preparing this AFFH, the San Mateo County jurisdictions participating in 21 Elements participated in a discussion with the local fair housing organizations Legal Aid of San Mateo County and Project Sentinel to learn about fair housing trends and concerns, as well as to discuss best practices in AFFH. Following this discussion, the consultant team contacted local fair housing organizations to obtain local data on fair housing complaints and lawsuits beyond what was available in HCD and HUD datasets.

Consultants also obtained and analyzed data from HUD. These datasets were compared for duplicate cases and analyzed and appear in the graphics and tables in this section.

Outreach and capacity. The Town of Atherton has posted its Draft Housing Element for 2023-2031 and advertised to residents an ADU survey, held multiple special meetings and study sessions with the City Council, and held community forums in January to gain input on the final Housing Element. The outreach was conducted via direct mailers to each property owner, use of social media, e-blasts to the Town’s registered email list and emails to housing organizations requesting notification.

Atherton has and will improve the accessibility of fair housing information on its website and resources for residents experiencing housing discrimination. Information on housing resources has already been expanded on the town’s website as well as information or resources for residents experiencing discrimination in housing or the Fair Housing Act. This includes providing contact information for local fair housing organizations, legal assistance, and general information about the Fair Housing Act and discrimination.

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Housing specific policies enacted locally. Atherton identified the following local policies that contribute to the regulatory environment for affordable housing development in the town.

Local policies in place to encourage housing development. ◼ Density bonuses for affordable housing per State Density Bonus Law ◼ Exempt floor area for ADU and JADU construction
◼ Local Ordinance implementing SB9
◼ Support for school and faculty housing solutions throughout Town and on campuses Local policies that are NOT in place but have Council interest for further exploration. ◼ Expanded ADU development and rental programs as well as incentives, to include reduction in fees
◼ Expanding support for school and faculty housing solutions ◼ Support for multiple single-family ADU rentals on single-family zoned parcels ◼ Support for new multifamily housing
◼ Fair housing legal service referrals
◼ Housing counseling subsidy referrals
The greatest barrier to construction of affordable housing in Atherton is the high cost of land. Property values in Atherton greatly outpace average land cost in other jurisdictions in San Mateo County. The current average cost of a developed acre is $7-$8 million. The Town believes that the high cost of land deters development opportunities for large-scale affordable housing projects. The Town believes that a distributed approach through the use of an ADU and JADU development and rental program mitigates the high cost of land and will ultimately be more successful. The Town has also identified several properties for rezoning to permit multifamily housing.

The graph below shows the radical difference in home values in Atherton that reflect the high cost of land as compared to other jurisdictions in San Mateo County and throughout the Bay Area.

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According to the California Department of Housing and Community Development AFFH Data Viewer (HCD data viewer), Atherton does not have public housing buildings. Atherton also does not have a significant share of households using housing vouchers.

Compared to nearby Redwood City and Menlo Park, to the Town’s knowledge, the Town does not have housing stock being utilized by renters with housing vouchers. The lack of presence of housing voucher users could indicate limited or no rental supply to house these residents.

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Bay Area policies are interconnected; Atherton’s land use policies that limit the parcel size and restrict multifamily development contribute to housing shortages in other areas of the county. Due to the high cost of housing, town employees and service workers are forced to other areas in search of affordable housing that is not found in the town in which they work. However, the Town does support the expansion of multifamily housing for students, staff and faculty at its local school sites that opens up affordable housing found in other communities by housing these individuals locally.

The figure above shows Atherton lacks renter-occupied housing compared to San Mateo County and the Bay Area. 40% of San Mateo County households are renters compared to only 7% in Atherton. This suggests that workers who cannot afford Atherton must rent elsewhere in the county, given the very limited numbers of rental units in Atherton. There are only 150 renter households in Atherton compared to 2,065 owner-occupied households. These statistics do not include multifamily rental opportunities at school sites. Both numbers have stayed relatively stagnant since 2000.

Renters in Atherton are young: 74% of those aged 15-24 and 88% of those aged 25-34 are renters. Unless they benefit from familial wealth, these renters must leave the town to purchase homes. Data is from ACS 5-year data (2015-2019).

According to ACS data, there are no multi-family homes, boats, RVs, vans or other types of housing in Atherton. 93% (2,021) of detached single-family homes are owneroccupied and 7% (150) are renter-occupied—providing the only rental stock in

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Atherton. All attached single-family homes (38) and mobile homes (6) are owneroccupied. Attached single-family homes have grown by only 30 homes and single family detached homes have lost 61 units in the past decade. The California Department of Finance counts six multi family homes with two to four units built in 2020.

Local Data and Knowledge. The demographics seen today are rooted in the region's history. In the 1960s, continued disinvestment and urban renewal in areas surrounding Atherton, such as East Palo Alto, exacerbated housing and education inequality.

Frustrated families in East Palo Alto petitioned for redistricting to address their concerns about education. The lines were drawn and redrawn, and eventually many Black students were bussed to Menlo-Atherton high school. Entrenched housing segregation translated to tension within the school. Black students felt unwelcome and white students felt unsafe in what developed as a microcosm of the exclusionary housing debate formed outside the school walls. The District Board of Trustees representing Menlo-Atherton High responded by limiting the policy to include only students living two miles or more from the school, strategically excluding Black neighborhoods as white students mostly had their own transportation. Protests and fighting ensued.13 Housing and educational boundaries go hand in hand. Over the years, overt tension has abated, but the effects of District policies and land use decision-making can still be seen. The zoning code in Atherton limits parcel size to primarily 1-acre parcels. This land use policy impacts student demographics (1) by limiting the overall number of students and (2) by skewing upward the household income level of those students due to the extremely high land cost. The zoning code in Atherton has almost exclusively permitted 1-acre parcels and single-family developments. The population charts below show how Atherton’s history is reflected in the demographics today. Data is from ACS.
13 https://www.machronicle.com/menlo-athertons-race-riots/

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3.340 Integration and Segregation
This section discusses integration and segregation of the population by protected classes including race and ethnicity, disability status, familial status, and income status.

Integration and Segregation
“Integration generally means a condition in which there is not a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a particular type of disability when compared to a broader geographic area.

Segregation generally means a condition in which there is a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a type of disability in a particular geographic area when compared to a broader geographic area.”
Race and ethnicity. Atherton is a less diverse community compared to the county. The largest proportion of the population is non-Hispanic White (69% v. 39% countywide), followed by Asian/API (21% v. 30% countywide). Residents of other or multiple races make up 5% of the population, Hispanic residents make up 4% of the population, and

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Black or African American residents make up 1%.14 The chart below, informed by ACS 2019 5-year data, shows the differences in racial makeup between Atherton, San Mateo County, and the Bay Area. Note that diversity by age cohort varies—older residents are less diverse with 89% of the population older than 65 years identifying as White compared to 61% of the population for children under the age of 18 years old.

The Dissimilarity Index, or DI, is a common tool that measures segregation in a community. The DI is an index that measures the degree to which two distinct groups are evenly distributed across a geographic area. The DI represents the percentage of a group’s population that would have to move for each area in the county to have the same percentage of that group as the county overall.

DI values range from 0 to 100—where 0 is perfect integration and 100 is complete segregation. Dissimilarity index values between 0 and 39 generally indicate low segregation, values between 40 and 54 generally indicate moderate segregation, and values between 55 and 100 generally indicate a high level of segregation. 14 The share of the population that identifies as American Indian or Alaska Native is less than 1%.

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The isolation index is interpreted as the probability that a randomly drawn minority resident shares an area with a member of the same minority, it ranges from 0 to 100 and higher values of isolation tend to indicate higher levels of segregation.

Disability status. The share of the population living with at least one disability is 8% in Atherton, which is the same as in San Mateo County. This has changed little over time, as the population was 7% in 2012. The three most common types of disabilities among those Atherton residents who indicated they were disabled are ambulatory difficulties (4.5%), cognitive difficulties (3.0%) and hearing difficulties (3.0%). No census tracts in the Town with a share of the population living with a disability above 10%. Geographic concentrations of people living with a disability may indicate the area has ample access to services, amenities, and transportation that support this population.

In addition, there are an estimated 18 individuals in Atherton with developmental disabilities, which include Down's Syndrome, autism, epilepsy, cerebral palsy, and mild to severe mental retardation. Of those in Atherton with a developmental disability,

27.8% are children under the age of 18 and 72.2% are adults. The most common living situation for individuals with developmental disabilities in Atherton is the home of a parent, family member or guardian; the second most common is independent or supported living facilities.

Familial Status. Atherton is home to more married-couple families and families with children than the county with 74% households being married-couple families compared to only 55% in the County. The town is home to fewer single-person households (13% v. 22% countywide v. 25% for the Bay Area). This is up from 61.7% of married-couple families in Atherton in 2010. The large, expensive homes in the area may draw prosperous couples in while also making it necessary to have incomes of two people to be able to afford the cost of living. Atherton has a similar share of families with children as both the county and the region (35% v. 33% countywide v. 32% for the Bay Area). It would appear that the greater concentration of large, singlefamily homes in Atherton compared to the region has little impact on the presence of children in a household.

The vast majority of households in Atherton are homeowners (93%). The number of housing units available by number of bedrooms and tenure is consistent with the familial status of the households that live in Atherton.

Household income. The household income distribution by percent of area median income (AMI) in Atherton is much more concentrated at above 100% AMI compared

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to the county (79% v. 49% countywide). There are no census tracts in the town with concentrations of poverty rates over 10%.. The Town has fewer extremely low-income and very low-income households, both at 6%, than the County as a whole, at 13% and 11%, respectively.

Throughout the region, the number of low-income renters greatly outpaces the amount of housing available that is affordable for these households. In Atherton, however, the largest proportion of both renters and homeowners fall within the “greater than 100% of AMI” income group. Zoning exclusively for single family home development can drive up the area median income.

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3.3550 Racially or ethnically concentrated areas of poverty and affluence Racially Concentrated Area of Poverty or an Ethnically Concentrated Area of Poverty (R/ECAP) and Racially Concentrated Areas of Affluence (RCAAs) represent opposing ends of the segregation spectrum from racially or ethnically segregated areas with high poverty rates to affluent predominantly white neighborhoods. Historically, HUD has paid particular attention to R/ECAPs as a focus of policy and obligations to AFFH.

Recent research out of the University of Minnesota Humphrey School of Public Affairs

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argues for the inclusion of RCAAs to acknowledge current and past policies that created and perpetuate these areas of high opportunity and exclusion.15 It is important to note that R/ECAPs and RCAAs are not areas of focus because of racial and ethnic concentrations alone. This study recognizes that racial and ethnic clusters can be a part of fair housing choice if they occur in a non-discriminatory market. Rather, R/ECAPs identify areas where residents may have historically faced discrimination and continue to be challenged by limited economic opportunity, and conversely, RCAAs are meant to identify areas of particular advantage and exclusion.

R/ECAPs
HCD and HUD’s definition of a Racially/Ethnically Concentrated Area of Poverty is:
◼ A census tract that has a non-White population of 50 percent or more (majorityminority) or, for non-urban areas, 20 percent, AND a poverty rate of 40 percent or more; OR
◼ A census tract that has a non-white population of 50 percent or more (majorityminority) AND the poverty rate is three times the average tract poverty rate for the County, whichever is lower.

Source: California Department of Housing and Community Development Guidance, 2021.

For this study, the poverty threshold used was three times the average tract poverty rate for the County—or 19.1%. In addition to R/ECAPs that meet the HUD threshold, this study includes edge or emerging R/ECAPs which hit two thirds of the HUD defined threshold for poverty—emerging R/ECAPs in San Mateo County have 2 times the average tract poverty rate for the county (12.8%).

In 2010 there were three census tracts that qualify as R/ECAPs (19.4% poverty rate) in the county and 11 that qualify as edge R/ECAPs (13% poverty rate). None of the R/ECAPs were located in Atherton in 2010.

In 2019 there are two census tracts that qualify as R/ECAPs (19.1% poverty rate) in the county and 14 that qualify as edge R/ECAPs (12.8% poverty rate). None of the 2019 R/ECAPs or edge R/ECAPs are located in Atherton. Below is the map for R/ECAPS in 2010.
15 Goetz, E. G., Damiano, A., & Williams, R. A. (2019). Racially Concentrated Areas of Affluence:

A Preliminary Investigation. Cityscape: A Journal of Policy Development and Research, 21(1), 99–124

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There are two R/ECAPs bordering Atherton in the Redwood City area and several more edge R/ECAPs. The cluster of R/ECAPs on the border of Atherton is significant because it shows that 1) minority census tracts tend not to access resources west of Redwood City, including Atherton; and 2) there are stronger minority communities that choose to live outside of the affluent, neighborhoods in Atherton. Both of these options inform each other.

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In 2019, there remains a cluster of R/ECAPs and edge R/ECAPS on the border of Atherton. The only change in the maps regionally is the expansion of the East Palo Alto/ Menlo Park area as an edge R/ECAP.

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RCAAs. HCD’s definition of a Racially Concentrated Area of Affluence is:

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◼ A census tract that has a percentage of total white population that is 1.25 times higher than the average percentage of total white population in the given COG region, and a median income that was 2 times higher than the COG AMI.

Atherton is considered an RCAA (based on 2019 data) because its total white population is 67% while that of the Association of Bay Area Governments (ABAG) is 40%. The map below shows Atherton’s proximity to other RCAAs. Atherton is largely surrounded by communities that are also RCAAs. These include portions of Menlo Park, Woodside, Portola Valley, Palo Alto, and Redwood City. As one travels West on El Camino Real towards Redwood City, there are fewer RCAAs. Although maps are not available through time, analysis shows that the white population has remained the majority demographic throughout Atherton’s history. Atherton has consistently had high home prices compared to San Mateo County and the Bay Area, suggesting that high income people are drawn to the area and are willing to pay a high price for large homes in the residential town. The Stanford area has more racial and income diversity from its student body and staff. The Palo Alto area is still expensive, and many employees of the University likely bypass Atherton and Menlo Park for cheaper housing in Sunnyvale and Redwood City.

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Although poverty rates within Atherton are very low, there are still minor disparities by race. For example, 5.3% of Asian and Asian Pacific Islanders are in poverty compared to 3.5% of white households. While the percentage is zero, Black, American Indian and Alaska Native populations may also face poverty in Atherton, but this should be interpreted with caution as the sample is far too small to draw conclusions. This chart shows that, although the area is considered a RCAA, within Atherton’s small Black Indigenous and People of Color (BIPOC) population there are variations of experience.

3.360 Access to Opportunity
This section discusses disparities in access to opportunity among protected classes including access to quality education, employment, transportation, and environment.

Access to Opportunity
“Access to opportunity is a concept to approximate place-based characteristics linked to critical life outcomes. Access to opportunity oftentimes means both improving the quality of life for residents of low-income communities, as well as supporting mobility and access to ‘high resource’ neighborhoods16. This encompasses education, employment, economic development, safe and decent housing, low rates of violent crime, transportation, and other opportunities, including recreation, food and healthy 16 Neighborhoods with the greatest access to public parks, transit, schools, grocery stores, and health facilities.

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environment (air, water, safe neighborhood, safety from environmental hazards, social services, and cultural institutions).”
Source: California Department of Housing and Community Development Guidance, 2021, page 34.

The California Tax Credit Allocation Committee (TCAC) in collaboration with HCD developed a series of opportunity maps that help to identify areas of the community with good or poor access to opportunity for residents. These maps were developed to align funding allocations with the goal of improving outcomes for low-income residents—particularly children.

The opportunity maps highlight areas of highest resource, high resource, moderate resource, moderate resource (rapidly changing), low resource and high segregation and poverty. TCAC provides opportunity maps for access to opportunity in quality education, employment, transportation, and environment. Opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes.

Education. TCAC’s education score is based on math proficiency, reading proficiency, high school graduation rates, and the student poverty rate. According to TCAC’s educational opportunity map, census tracts in Atherton score between 0.25 and

0.75—opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes. The census tract scoring between 0.25 and

0.50 is located west of El Camino Real and the census tract to the east scores between

0.50 and 0.75.

Patterns within San Mateo County reveal that over the last decade, schools have become increasingly more diverse, with Hispanic students making up 38% of enrollments. Ravenswood and Redwood City, to the West and Northeast of Atherton respectively, have the highest number of Hispanic students in the County at 84% and 70%. In Redwood City Elementary, which includes Adelante Selby Spanish Immersion School in Atherton, more than one-third of students are English learners. Ravenswood serves the census tract that scored between 0.25 and 0.50. Therefore, the significant number of English learner students could be skewing down the educational outcomes in that census tract compared to schools with more proficient English speakers An astounding 30% of students at Ravenswood Elementary are experiencing homelessness compared to the county-rate of 2%. Without a stable place to complete schoolwork and, most importantly, feel safe and secure, students are unable to reach their full potential and thus have lower education scores. There are limited affordable

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housing options in Atherton and other jurisdictions surrounding Ravenswood for families to access once they are displaced.

Atherton is served by the Menlo Park City, Redwood City, and Las Lomitas Elementary School Districts; and the Sequoia Union Unified High School District.

Menlo Park City Elementary experienced an increase in enrollment of 6% from 2010 to 2020, while enrollment in Redwood City Elementary and Las Lomitas Elementary decreased 11% and 16% respectively. This represents a much larger decrease than the one percent decrease experienced in the county.

Enrollment in Sequoia Union Unified High School District increased by 18% from 2010 to 2020. Enrollment at Menlo Atherton High School is approximately 2,400 students, with 5% of those students residing in Atherton.

Enrollment composition by race and ethnicity varies by district. Menlo Park City Elementary and Las Lomitas Elementary have a higher share of White students than San Mateo County (55%, and 53% respectively, v. 26%). Redwood City Elementary has a much higher share of Hispanic students than San Mateo County (70% v. 38%). The enrollment composition in Sequoia Union High School District is similar to the countywide distribution.

Atherton has received an average of 18 short-term enrollments of migrant student workers per year according to California Department of Education data. This is significantly fewer than the county level, which sees an average of 416 per year.

Overall, 29% of public-school students in San Mateo County qualify for reduced lunch.

This number was substantially higher in Redwood City Elementary School District (which includes Atherton’s Adelante Selby Spanish Immersion School), where 56% of students qualify for reduced lunch. County-wide, 20% of public-school students are English learners. Again, this rate is higher at Redwood City Elementary, where 38% of students are English learners.

In contrast, the share of students who qualify for reduced lunch, are experiencing homelessness, or are English learners is lower in Menlo Park City Elementary and is significantly lower in Las Lomitas Elementary than the countywide share.

Countywide 27% of Hispanic students met or exceeded mathematics testing standards and 40% met or exceeded English testing standards. Hispanic students in Menlo Park City Elementary, Las Lomitas Elementary, and Redwood City Elementary, which includes Atherton’s Adelante Selby Spanish Immersion School, performed better

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compared to the county (55%, 44%, and 34% respectively in mathematics and 62%, 65%, and 43% in English).

Many high schoolers in the county met admission standards for a University of California (UC) or California State University (CSU) school. Of the high school districts in San Mateo County, Sequoia Union had the highest rate of graduates who met such admission standards at 69% followed by San Mateo Union High with 68%. Pacific Islander, Hispanic, and Black students in the Sequoia Union district were less likely than their peers of other races and ethnicities to meet the admission standards with rates of 38%, 55%, and 50%, respectively.

Despite the high share of students meeting college admission standards, Sequoia Union has the second to lowest college going rate in the County, at 70%. The highest rate was 77% in San Mateo Union High.

In addition, Sequoia Union district has the highest dropout rate in the County (10%) and dropout rates among Pacific Islander (20%), Hispanic (16%), and Black (12%) students are much higher. Students with disabilities and those learning English dropped out at the highest rate at 24% and 27%, respectively. This is a sign that the district does not offer adequate support for students facing barriers because of their race, language skill, and disability. However, there are promising increases in diversity of school staff that serve as an advantage to a diverse student body.

Another possible reason can be traced to chronic absenteeism, which means students miss more than 10% of school days. 17% of students in the Sequoia Union High School District struggle with chronic absenteeism, which drastically lowers test scores and social engagement with peers and mentors. Black and Hispanic students were more likely to be chronically absent. Schools with more homeless students also saw more chronic absenteeism, illuminating a connection between school performance and stable housing.

Menlo College has a student population of more than 825. Demographics of the College are 29% White, 6% Black, 22% Hispanic, 10% Asian, 1% American Indian/Alaskan, 2% Hawaiian/Pacific Islander, 8% Two or More races, 14% International and 9% Race Unknown.

Employment. According to ACS data, the top three industries by number of jobs in Atherton include professional and managerial services, health and educational services, and arts and recreation services. In the terms of job holders, the top industries are professional and managerial services, and health and educational services. The chart below shows employment by industry and region.

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Atherton has a lower job to household ratio at 1.14 when compared to the county at

1.59. The town has a slightly higher unemployment rate than the county, but saw a sharp incline in the unemployment rate in 2020 that has yet to return to pre pandemic levels.

TCAC’s economic opportunity score is comprised of poverty, adult educational attainment, employment, job proximity, and median home value. The entire town area scores more than 0.75 for economic opportunity—highest economic outcome.

HUD’s job proximity index shows the eastern part of the town in relatively close proximity to jobs (score between 60 to 80) while the western part scores between 40 and 60— on a scale from zero to 100 where 100 is the closest proximity to jobs.

There are several barriers to high paying jobs for protected classes, most of which can be traced back to educational opportunities and outcomes. As highlighted in the previous education section, Black, Hispanic, and English language learners have the highest school absenteeism and drop out rate in the school district covering Atherton.

The majority of employment in Atherton is in the financial and professional service sector and the health and educational services sector. Most of these jobs likely require education beyond high school. Because Black and Hispanic students are more likely

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to drop out, employment options that will provide adequate pay to financially qualify for housing in Atherton are drastically reduced.

In general, new jobs continue to outpace new homes, and especially new affordable homes, in the county. Since 2010, the county has added 100,000 jobs but only 10,000 new homes. Jobs are expected to increase 22 percent between 2020 and 2050. So while residents in the county may technically have more employment opportunities, the lack of affordable housing near these jobs will continue to act as a barrier to accessing these employment opportunities
Transportation. This section provides a summary of the transportation system that serves Atherton and the broader region including emerging trends and data relevant to transportation access in the town. The San Mateo County Transit District acts as the administrative body for transit and transportation programs in the county including SamTrans and the Caltrain commuter rail. SamTrans provides bus services in San Mateo County, including Redi-Wheels paratransit service.

In 2018, the Metropolitan Transportation Commission (MTC), which covers the entire Bay Area, adopted a coordinated public transit and human services transportation plan. While developing the coordinated plan, the MTC conducted extensive community outreach about transportation within the area. That plan—which was developed by assessing the effectiveness of how well seniors, persons with disabilities, veterans, and people with low incomes are served—was reviewed to determine gaps in services in San Mateo and the county overall. Below is a summary of comments relevant to San Mateo County. There were no comments specific to Atherton. “San Mateo’s PCC and County Health System, as well as the Peninsula Family Service Agency provided feedback. The most common themes expressed had to do with pedestrian and bicycle needs at specific locations throughout the county, though some covered more general comments such as parked cars blocking sidewalk right-of-way and a desire for bike lanes to accommodate motorized scooters and wheelchairs. Transportation information, emerging mobility providers, and transit fares were other common themes.

While some comments related to the use of car share, transportation network companies (TNCs), or autonomous vehicles as potential solutions, other

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comments called for the increased accessibility and affordability of these services in the meantime.”17
A partnership between the World Institute on Disability and the MTC created the research and community engagement project TRACS (Transportation Resilience, Accessibility & Climate Sustainability). The project’s overall goal is to, “stimulate connection and communication between the community of seniors and people with disabilities together with the transportation system– the agencies in the region local to the San Francisco Bay, served by MTC.”18
As part of the TRACS outreach process, respondents were asked to share their compliments or good experiences with MTC transit. One respondent who had used multiple services said, “it is my sense that SamTrans is the best Bay Area transit provider in terms of overall disability accommodation.”
The San Mateo County Transit District updated their Mobility Plan for Older Adults and People with Disabilities in 2018. According to the district, the county’s senior population is expected to grow more than 70% over the next 20 years and the district is experiencing unprecedented increases in paratransit ridership. The plan is targeted at developing effective mobility programs for residents with disabilities and older adults including viable alternatives to paratransit, partnerships, and leveraging funding sources.19
MTC also launched Clipper START—an 18-month pilot project— in 2020 which provides fare discounts on single transit rides for riders whose household income is no more than double the federal poverty level.
20 Homeowners in the County are more likely to report
that they cannot access public transit easily or safely. In 2020, Caltrain voted to close Atherton’s station due to low ridership. There were some residents that thought this would be harmful to those who do not have access to a car or cannot drive, such as the elderly and disabled community; however, there were alternative resources identified such as the nearby Menlo Park Train Station and associated bus lines on El Camino Real and Middlefield Road.21
17 https://mtc.ca.gov/sites/default/files/MTC_Coordinated_Plan.pdf 18 https://wid.org/transportation-accessibility/
19https://www.samtrans.com/Planning/Planning_and_Research/Mobility_Plan_for_Older_Adul ts_and_People_with_Disabilities.html
20 https://mtc.ca.gov/planning/transportation/access-equity-mobility/clipperr-startsm 21https://www.smdailyjournal.com/news/local/residents-react-to-plan-to-close-atherton-s-caltrain-stop/article_3070cdd2- d539-11ea-ad6b-4b3eeab63a6c.html

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Environment. TCAC’s opportunity areas environmental scores are based on the CalEnviroScreen 3.0 indicators, which identify areas disproportionately vulnerable to pollution sources such as ozone, PM2.5, diesel PM, pesticides, toxic release, traffic, cleanup sites, groundwater threats, hazardous waste, impaired water bodies, and solid waste sites.

According to TCAC’s opportunity map, census tracts in Atherton score between 0.25 and 0.75—opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes. The census tract scoring between

0.25 and 0.50 is located west of El Camino Real and the census tract to the east scores between 0.50 and 0.75. The town scores the highest on the California Healthy Places Index (HPI) developed by the Public Health Alliance of Southern California (PHASC).

The HPI includes 25 community characteristics in eight categories including economic, social, education, transportation, neighborhood, housing, clean environment, and healthcare.22
Disparities in access to opportunity. Racial and ethnic minorities are more likely to live in moderate resource areas compared to non-Hispanic White residents. The chart below details the percentage of households by race living in resource areas. Note that there are no households in Atherton living in a low resource area. 71% of Hispanic households live in moderate resource areas compared with 29% in high resource areas. Similarly, 77% of Black households live in moderate resource areas and 23% live in high resource areas. Non-Hispanic, multiple race households have the highest population in high resource areas, however this population is relatively small with 323 households compared with 4,966 white households. Racial and ethnic minorities living in Atherton are wealthier compared to the county and Atherton is home to a disproportionately small share of residents with limited English proficiency (1% compared to 7% countywide).
22 https://healthyplacesindex.org/about/

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TCAC’s composite opportunity score for Atherton shows census tracts west of El Camino Real fall within moderate resource areas while the rest is within high resource areas.

The Social Vulnerability Index (SVI) provided by the CDC—ranks census tracts based on their ability to respond to a disaster—includes four themes of socioeconomic status, household composition, race or ethnicity, and housing and transportation. The index shows Atherton as a low vulnerability area.

Atherton does not have any disadvantaged communities as defined under SB 535, “disadvantaged communities are defined as the top 25% scoring areas from CalEnviroScreen along with other areas with high amounts of pollution and low populations.”23
Disparities specific to the population living with a disability. Eight percent of the population in Atherton are living with at least one disability, the same share as in the 23 https://oehha.ca.gov/calenviroscreen/sb535

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county. The most common disabilities in the town are ambulatory (4.5%), cognitive (3.1%), and hearing (3.0%).

Disability
“Disability types include hearing difficulty, vision difficulty, cognitive difficulty, ambulatory difficulty, self-care difficulty, and independent living difficulty.” Source: California Department of Housing and Community Development Guidance, 2021, page 36.

For the population 65 and over the share of the population with an ambulatory or independent living difficulty increases. As mentioned above under access to transportation, San Mateo County is rapidly aging, therefore this population with a disability is likely to increase.

Unemployment is disproportionately high among residents living with a disability at 11% compared to 5% for residents without a disability in Atherton—particularly when compared to the county. High unemployment rates among this population points to a need for increased services and resources to connect this population with employment opportunities.

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3.360 Disparate Housing Needs
This section discusses disparate housing needs for protected classes including cost burden and severe cost burden, overcrowding, substandard housing conditions, homelessness, displacement, and other considerations.

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Disproportionate Housing Needs
“Disproportionate housing needs generally refers to a condition in which there are significant disparities in the proportion of members of a protected class experiencing a category of housing need when compared to the proportion of members of any other relevant groups, or the total population experiencing that category of housing need in the applicable geographic area. For purposes of this definition, categories of housing need are based on such factors as cost burden and severe cost burden, overcrowding, homelessness, and substandard housing conditions.”
Source: California Department of Housing and Community Development Guidance, 2021, page 39.

Housing needs. Population growth in Atherton has historically been driven by economic cycles. The town experienced a sharp loss in population between 1999 and 2000 and again between 2009 and 2010. Since 2010 population growth has been slower than the County’s and the town has not reached the population level it had prior to the 2008-09 financial crisis. However, the town does not appear to have experienced a sharp population decrease in 2020 with the COVID-19 pandemic.

Since 2015, the housing construction to accommodate growth has largely been priced for above moderate-income households with 78 units permitted for above moderate-income households compared to 35 for very low-income households, 15 for low-income households, and 3 for moderate income households. The Housing Needs Data Report for Atherton indicates new construction is slower than the rest of the Bay Area. 24One example of a group who has found workforce housing hard to come by are the employees of the Atherton Police Department. In 2018, employees advised the City Council that they faced long commutes on top of twelve-hour shifts and had little time to sleep. The commute was necessary because there are limited affordable options in the region for their families. In the past, the town had used a town-owned property in a deed-restricted park as a place for police to sleep. This solution was not sustainable for the town or police officers, who wanted to spend more time with their families instead of commuting.25 This makes recruitment and retention difficult.

The variety of housing types available in the town in 2020 are predominantly single family (98%). Six multi-family homes were added in 2020. Single family detached saw a decline in units and single family attached saw a small incline. Due to its land use 24 Housing Needs Data Report: Atherton, ABAG/MTC Staff and Baird + Driskell Community Planning, 2021.
25 Atherton looking for place for officers, dispatchers to sleep between shifts | News | Almanac Online | (almanacnews.com)

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zoning and high cost of land, Atherton has developed far fewer multifamily units than the region. 26
According to the ABAG Housing Data Workbook, the majority of the housing inventory in Atherton was constructed from 1940 to 1959, with 1,087 units built between 1940 to 1959 compared to 180 units built in 2010 or later (Figure IV-3). However, actual Town building permit records reflect that from 2010 forward more than 320 new single-family home building permits were issued. Compared to San Mateo County, the Town’s owner-occupied housing market has a greater share of units priced above $2 million.

Ninety percent (90%) of units in Atherton fall within this price range compared to 19% in the county. According to the Zillow home value index, home prices have experienced exponential growth in the town and the county. The town is an outlier, with the Zillow home value index at $6.6 million for Atherton compared to the county’s $1.4 million.

Given the small share of renters in the town, rental price trends are less accurate than the County’s, but appear to have experienced appreciation since 2014. Compared to the county, Atherton has more luxury rental units—67% of units rent for more than $3,000 in the town compared to 22% in the county. A point-in-time Google search found no home for rent under $5,000 per month. Workers would need higher incomes 26 Housing Needs Data Report: Atherton, ABAG/MTC Staff and Baird + Driskell Community Planning, 2021.

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to qualify for rentals available in Atherton–and are thus inclined to seek out homeownership or lower cost rental opportunities in other communities. However, the Town is in the process of implementing a robust and inclusive ADU program that will facilitate, support, and encourage the development and rental of accessory dwelling units at affordable rates via a HIP Housing Program.

Resident survey data provide evidence of more rental inventory, reporting that owners are renting ADUs to senior family members, students, school faculty, and local service workers at significantly reduced or below market rental prices. Many of these rental opportunities are not marketed in the traditional way using Zillow, Craigslist or other platforms. Rather, because Atherton is a small community, property owners will reach out directly to those in need of such housing solutions or offer housing through a local school’s housing referral program.

Cost burden and severe cost burden. As expected, a low share of households in Atherton are cost burdened—spending more than 30% of their gross income on housing costs— compared to the county (28% v. 37% in the county).

Lower income households are more likely to experience housing cost burden. One out of seven households with income below 80% AMI are severely cost burdened— spending more than 50% of their gross income on housing costs. Cost burdened households have less money to spend on other essentials like groceries, transportation, education, healthcare, and childcare. Extremely cost burdened households are considered at risk for homelessness. Cost burden suggests that wages have not kept up with housing costs in the area.

When cost burden is broken down by Area Median Income (AMI), there are stark differences. The chart below indicates these disparities. Although those with greater than 100% AMI likely spend the most on housing, their incomes can meet these costs. 80% of those in this group spend 0-30% of their income on housing. In contrast, 88% of those earning 0-30% AMI spend over 50% of their income on housing costs.

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As mentioned previously, racial and ethnic minorities living in Atherton are wealthier compared to the county. Asian/API and Hispanic households are less likely to be cost burdened than non-Hispanic white households. Households of other or multiple races experience higher rates of cost burden—56% are extremely cost burdened, compared to 16% in the town overall.

There are also differences by tenure. In San Mateo County, 29.6% of homeowners pay more than 35% of their income towards housing and 42.8% of renters pay more than 35% of their income towards housing costs. This is higher than in Atherton, likely because there are more people over 100% AMI. In Atherton, 29% of owner-occupiers pay more than 30% of income towards housing. Statistics on renter income to housing costs are difficult to calculate because of the low number of renters in Atherton, thus 51% of renter cost has not been calculated in ACS data. From what exists, 65% of renteroccupied households pay more than 30% of income on housing costs and 11% pay 30-50% of income on rent.

The map below shows cost burden by census tract. Discrepancies in the percentage of Atherton renters paying more than 30% of their income for rent may be attributed, as has been noted, to the difficulty of calculating these figures based on the low number of renters in Atherton. ACS 5-year 2019 data shows 20-40% of renters in Atherton are paying more than 30% of their income on rent. Atherton is largely surrounded by cost burdened communities. 60-80% of renters are cost burdened in the

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East Palo Alto and Redwood City area. It could be that there are more renters in these adjacent communities because Atherton offers few renter-occupied units. Thus residents of San Mateo County who cannot yet afford a house are forced to pay a high cost of housing as renters in areas outside of Atherton.

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Cost burden for homeowners is more significant in Atherton. This is not surprising given that there are more owner-occupied single-family homes in the town and therefore there is better data on owners than renters. At least 20% of homeowners in Atherton spend more than 30% of their income on housing costs. Southwest Atherton, which notably had fewer cost burdened renters than other areas of the town, has the town’s highest percentage of homeowners who are cost burdened in the town at 40-60%.

Again, Atherton is surrounded by communities where over 20% of homeowners are cost burdened, suggesting that homeownership is still unaffordable to those even with relatively high incomes.

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Overcrowding. The vast majority of households (99%) in Atherton are not overcrowded—indicated by more than one occupant per room.

Racial and ethnic minorities are more likely than non-Hispanic White households to experience overcrowding. Other races (21% of households), and Hispanic households (19%), experience the highest rates of overcrowding.

In San Mateo County, 6.9% of households have more than one occupant per room.

This is slightly better than the state average of 8.2%.

Overcrowding is often related to the cost of housing with multiple households sharing a unit to make it possible to afford the unit. Below, the map shows where overcrowding in the Bay Area is more common. East Palo Alto and Redwood City have the highest percentage of overcrowding in the region, likely because of their high renter population. Multifamily rental units have less bedrooms than single family homes. There are also higher populations of Hispanic residents in these areas. Hispanic households tend to have larger, multigenerational households, which could account for the higher overcrowding rate.

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Substandard housing. Data on housing conditions are very limited, with the most consistent data available across jurisdictions found in the American Community Survey (ACS)—which captures units in substandard condition as self-reported in Census surveys. According to data estimates, the share of housing units with substandard kitchen and plumbing facilities in Atherton is zero, despite an aging housing stock. This data estimate is further substantiated by direction from the Town’s Code Enforcement Officer. . This could be because all residents live in moderate or high resource areas where renovations are financially feasible and most residents are homeowners who are able to modify their units. San Mateo County also has a low rate of substandard housing; 99.9% of households have complete kitchen and plumbing facilities.

As shown in the map below, residents who do not have complete kitchen or plumbing utilities tend also to live in severely overcrowded conditions, and are severely cost burdened, Atherton has less than 20% of residents in substandard conditions. In East Palo Alto and Southeast Redwood City, however, 40-60% of all households selected at least one of the substandard housing issues. Substandard housing congregates in areas of low income because these residents do not have the financial leverage to improve housing conditions, have landlords who are unwilling to make improvements, or do not ask for improvements or report conditions in fear of retaliatory eviction.

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Homelessness. In 2019, 1,512 people were experiencing homelessness in the county, 40% of these individuals were in emergency or transitional shelter while the remaining 60% were unsheltered. The majority of unsheltered people experiencing homelessness were in households without children. The majority of people in transitional housing were in households with children. These disparities may indicate there are more resources available in the County for families experiencing homelessness as compared to for single individuals experiencing homelessness.

People who identify as American Indian or Alaskan Native (6% homeless, less than 1% general population), Black (13%, 2%), White (67%, 51%), and Hispanic (38%, 28%) are overrepresented in the homeless population compared to their share of the general population. The disparities by race can be traced back to discrimination in the housing market and the exclusion of non-white populations from high resource areas. There are few housing options for low-income people in the region. Housing that is available at the market rate likely forces people to spend more than 50% of their income on housing, which puts households at risk for homelessness.

People struggling with chronic substance abuse (112 people), severe mental illness (305), and domestic violence (127) represent a substantial share of the homeless population in 2019. This indicates that there are not enough resources or beds for those experiencing mental illness, substance abuse, and domestic violence in the county.

Displacement. Owner households generally enjoy a greater amount of housing stability whereas renter households are more mobile. Atherton has no inventory of income assisted rental units. In San Mateo County, 417 units are at risk, accounting for 8% of the total assisted housing units in the county.

Displacement Sensitive Communities
“According to the Urban Displacement Project, communities were designated sensitive if they met the following criteria:
◼ They currently have populations vulnerable to displacement in the event of increased redevelopment and drastic shifts in housing cost. Vulnerability is defined as:

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Share of very low-income residents is above 20%, 2017
AND
The tract meets two of the following criteria:
− Share of renters is above 40%, 2017
− Share of people of color is above 50%, 2017
− Share of very low-income households (50% AMI or below) that are severely rent burdened households is above the county median, 2017
− They or areas in proximity have been experiencing displacement pressures. Displacement pressure is defined as:
● Percent change in rent above county median for rent
increases, 2012-2017
OR
◼ Difference between tract median rent and median rent for surrounding tracts above median for all tracts in county (rent gap), 2017” Source: https://www.sensitivecommunities.org/.

No census tracts in the town are vulnerable to displacement, however, housing cost burden is a risk for displacement and 88% of residents below 30% AMI pay more than 50% of their income on housing Atherton’s rent’s rental cost is far above regional median rent, suggesting that there is displacement pressure in place. Assuming this number trend applies to the Town, that would mean that of the Town’s 149 extremely low-income households, 131 are overburdened by their housing costs.

The chart below shows median rent in Atherton, San Mateo County, and the Bay Area.

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As discussed in the previous section regarding R/ECAPs, Atherton is near edge R/ECAPs in Redwood City and Menlo Park. This suggests that people who may be displaced from Atherton may migrate to these areas and that people within Redwood City and Menlo Park who are displaced cannot access resources within Atherton.

Displacement can also occur because of natural disasters. Atherton is in San Mateo County, which is on the San Andreas fault and therefore has a high likelihood of severe earthquakes. Houses in California are generally made to withstand earthquakes, but those who spend more than 30% of their income on housing costs likely cannot save enough to repair severe damage. This means those of lower income are more at risk of displacement.

Access to mortgage loans. Disparities by race and ethnicity are prevalent for home mortgage applications, particularly in denial rates. Hispanic (60% denial rate) and Asian/API (29%) have the highest denial rates for mortgage loan applications in 2018 and 2019, compared to non-Hispanic White households (18%). These numbers suggest that traditional routes to homeownership are barriers to non-white households. Credit score, assets, and income disparities between races show in denial rates.

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3.370 Site Inventory Analysis
There are no R/ECAPs or edge R/ECAPS located within the Town of Atherton. Edge R/ECAPS within unincorporated San Mateo County have proximity to portions of Atherton along the western edge of Town bounding El Camino Real.

The complete inventory of identified opportunity sites is included as Appendix 5 and expanded up in section 3.410.

3.380 Contributing Factors and Fair Housing Action Plan The factors contributing to fair housing challenges within Atherton is the high cost of land acquisition, zoning primarily for single family homes, and little affordable housing for those with moderate and low income who work in the town, other than ADUs and housing at local school sites. Per an analysis completed in 2022, the average land acquisition cost for a single acre in Atherton is approximately $7-8 million. The affordability of land is a high bar to the creation of affordable housing and the greatest barrier to development. The Town has taken a muti-pronged approach to address affordable housing. The best opportunities for affordable housing include ADUs and multi family units on school sites where the land is already owned by the entity. In addition, the Town has identified several properties for upzoning to permit multifamily housing. Coupled with the new multifamily zoning districts, the Town will adopt an inclusionary ordinance to ensure a portion of the new multifamily housing units are available as affordable housing to lower income households. These steps will address fair housing issues, including segregation.

The Town is continuing to see success in the creation of additional ADU units. The Town estimates that 60% of new rental ADU units will be rented at very low or low-income levels. Based on existing precedent, these units are often used for housing for a senior family member, employees of the homeowner, students, or in other similar circumstances where the renter would otherwise be unable to find similar accommodations locally. Consequently, the ADU occupants do not displace others from low-income housing that is available locally.

ADUs have several other advantages. They can be constructed at significantly lower cost than the cost to build a new multifamily unit. They can be located anywhere within the Town, which means such low-income units are geographically spread throughout Atherton. They are also politically popular and easy to permit.

The Town is implementing several strategies to further utilize ADUs as a tool for providing fair housing opportunities, including:
▪ Expanding community outreach to realize additional ADU development.

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▪ Developing assistance programs for JADUs to make alterations easier and more cost effective so that additional units can be developed within the existing building envelope of houses and made available at more affordable rates. ▪ Amending the Zoning code to eliminate the occupancy limitation on other accessory units, such as guest houses and pool houses.
▪ Creating an inventory of existing pool houses and guest houses, and then working with a nonprofit to connect homeowners to prospective renters. ▪ Amending the Zoning code to increase the height limit to allow ADUs to be constructed above garages.
▪ Amending the Zoning code to allow two ADUs to be constructed on parcels that are 2 acres or greater.
▪ Amending the Zoning code to allow multiple ADUs to be rented on a property. ▪ Amending the fee resolution to remove the planning review fees for ADUs. ▪ Adopt an affordable housing impact fee on single family construction. The Town will make available funds from this program to provide very low-income rental assistance for eligible households identified by HIP.

The Town’s complete strategy related to encouraging ADU production and the rental of these units is provided in section 3.812.

Further to provide greater diversity in the housing stock and opportunities for lower income households, the Town has included programs to rezone several properties to allow multi-family housing. These properties have been strategically identified to be near transit and services.

Additionally, the Town will be providing additional fair housing resources and training for property owners, real estate agents, and tenants, per section 3.823 E. This will be provided through a collaboration with other cities and towns, Project Sentinel, or other similar organization. This will provide information on reasonable accommodation and issues related to income and other forms of discrimination. This training could be mandated for multi-family developers, property owners and any resident renting an ADU or similar unit. The Town will also create a webpage to host this information and improve awareness around fair housing training, issues and available programs. The webpage will also provide information on filing fair housing complaints with HCD or HUD.

Lastly, as part of its ADU rental strategy, the Town will implement a program to affirmatively market low-income units to households that are under-represented in the Town in comparison to neighboring jurisdictions and the County. To examine the effectiveness and interest in the ADU strategy, a survey of potential renters in the area, such as employees of homeowners, school and city staff, and elderly individuals is also being pursued.

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3.400 HOUSING RESOURCES

3.410 Inventory of Sites Suitable for Residential Development

3.411 Parcel-specific List of Available Sites
This section contains an inventory of specific sites suitable for residential development so that a comparison may be made with Atherton’s new construction need by affordability category with its residential development capacity.

The accompanying table (Appendix 5) identifies lands suitable for residential development in Atherton. The HCD Electronic Housing Element Site Inventory Form has been used. Each site is identified by address and assessor’s parcel number and includes the site acreage and existing land use. Existing zoning falls into the categories listed below. It should be noted that Atherton has only four zoning districts, the three listed below plus a Parks and Open Space District.

R-1A (Residential District) - Limits land uses to single-family detached homes on minimum one-acre size lots.

R-1B (Residential District)-Limits uses to single-family detached homes on minimum size 13,500 square foot (0.31 acre) lots.

PFS (Public Facilities and Schools District) - Limits land uses to public and private schools including affiliated residential uses, town hall, library and other similar public and quasipublic uses without limitation on lot size. This district also permits single-family and multifamily residences pursuant to a master plan.

Multifamily Rezonings
A new multifamily overlay zoning district is proposed to be adopted following Housing Element certification to provide a range of housing opportunities to the community.

The RM 10 Multifamily District permits multifamily residential uses by right with a maximum density of 10 dwelling units per acre. The new multifamily zoning district will allow heights up to 40 feet, adequate setbacks to accommodate the maximum density, parking standards and objective design standards.

The property listed below was prioritized for rezoning because it is located close to services, transit, jobs with adequate access along a public right-of–way and the property owner is interested in development the site as multi-family housing. A letter from the property owner is included in the Appendix of the Housing Element.

Multifamily rezone property:

Property Acreage Density # of Units

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1 23 Oakwood 1.62 acres 10 units per acre 16 units
The new multifamily district is further described in Section 3.811 - Housing Programs.

Menlo College – 1000 El Camino Real
Menlo College is a private 4-year college located at 1000 El Camino Real sited on 31 acres of property (including 50% ownership of Cartan Athletic Field and Wunderlich Athletic Field) serving over 800 students. All freshman and sophomore students are required to live on campus in rental units. The campus is zoned Public Facilities and Schools (PFS) and abuts the Victoria Manor residential subdivision to the south (R1-A zoning), the MacBain Avenue residences to the west (R1-A zoning), Alejandro Avenue to the north and Menlo School to the south (PFS zoning). The policies within the Housing Element provide that the Town would allow the school development by right at 20 units per acre.

Menlo College currently has 567 beds in 5 residence halls for its students with an additional 288 beds added in the fall of 2022. These units free up existing affordable housing opportunities in the local community. The on-site student housing frees up housing units in the community and addresses the needs of very-low-income students that were experiencing homelessness. The College also has 25 housing units for its faculty and staff and has a waiting list for more rental needs. Most of those housing units are rented at rates affordable to low- and moderate-income households.

In recent discussions between the College President and Atherton Planning Staff, the President indicated that the College is very interested in providing additional housing on campus. He stated that there is always a demand for additional housing, that the existing units are almost always 100% occupied, and that shortage of affordable housing is a barrier to hiring. Funding has also been a barrier to housing production in the past. Through this Housing Element update process, a group of residents have been formed to assist the College with resources to prepare site feasibility studies and commitment to identify funding sources to build the housing. The attached letter from the College President indicates that the College could support 60 to 90 new multifamily housing units. Letter from the College President is included as an appendix. These sites would contribute to fair housing by accommodating moderate and low income school staff including accessible units. The Town will ensure that there are units for staff across the income spectrum, from teaching faculty to janitorial staff. This consideration applies to all premises willing to build affordable housing listed below.

The existing PFS zoning requires a conditional use permit for residential uses and allows multifamily residential uses by right (with the provision of very low and low-income units), subject to Planning Commission review of the location, size, proximity to heritage trees and environmental aspects of the project. There are seventeen existing buildings on the campus with a total floor gross area of approximately 307,700 square feet. The total building footprint area is 269,500 square feet resulting in 29% lot

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coverage. The PFS zone allows 40% lot coverage with no maximum floor area ratio.

The site can accommodate several new buildings. Based on discussions with the College President and a review of site improvements, there are multiple sites on campus that are viable locations for multifamily housing.

Site 1: The existing O’Brien surface parking lot at the southwest corner of El Camino Real and Alejandra Avenue is approximately 75,000 square feet (1.7 acres) in area. The site is level and currently contains a paved parking lot. The lot is surrounded by mature vegetation. Construction of a multi-family housing building is feasible at this location with podium parking at ground level and 3 stories of housing above, or below grade parking. The town does not have on-site parking requirements.

Parking would be replaced to meet the needs of the college. The Town will rezone this site to permit 40 units per acre by right with objective design standards. The College has expressed interest in developing 60 dwelling units at this site.

Site 2: There are four residences located on the campus in WWII barracks that are currently utilized for faculty housing. Demolition of these residences would accommodate 30 apartment units, resulting in a net increase of 26 multifamily housing units.

Site 3: In addition to the sites identified above, the College has identified a site interior to the campus that is viable for a multi-story multi-family development of 40 to 60 units. The site, near the Administration Building, is currently used as parking. Additional parking can be developed near the entry to the College off of El Camino Real.

The housing sites on the Menlo College campus are located near a public transportation route (SamTrans bus route on El Camino Real) and would therefore qualify for State mandated reduced parking provisions. To accommodate the new housing development, the zoning will be amended as follows:
● Rezone Site 3 to permit multifamily housing at a density of 40 units per acre and rezone Site 2 to permit multifamily housing at a density of 20 units per acre ● Reduce the minimum front yard setback to 30 feet
● Amend the height limit to allow 4 stories at 48 feet
● Permit multifamily housing by right with objective design standards With the zoning amendment, new multifamily housing would be feasible at the Menlo College campus and would provide housing for a range of income categories, most notable in the very-low to low and moderate income range. The new multifamily housing would also provide accessible units.

Menlo School – 50 Valparaiso Avenue
Menlo School is a private grade 6 - 12 school located at 50 Valparaiso Avenue sited on 26.7 acres of property (including 50% ownership of Cartan Athletic Field and Wunderlich Athletic Field) serving approximately 795 students. The school site is zoned

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Public Facilities School (PFS) and currently allows for the development of multifamily residential uses. The policies within the Housing Element provide that the Town would allow the school development by right at 20 units per acre.

The school property abuts the Victoria Manor residential subdivision to the east (R1-A zoning), the Michaels Way residential subdivision to the west (R1-A zoning) and Menlo College to the north (PFS zoning). There are eleven existing buildings on the campus with a total gross floor area of 311,574 square feet. Two housing sites have been identified on the Menlo School campus following a review of site improvements:

Site 1: An approximate 56,000 square foot (1.28 acre) surface parking lot located in the southwest corner of the campus with frontage on Valparaiso Avenue and the school entry drive. A 75-foot setback for buildings higher than 22 feet is required by the zoning along the west property line (adjacent to single family homes). An emergency access road required by the Menlo Park Fire District exists within this 75- foot setback (perimeter fire road). At a density of 20-units per acre, this site could yield 25 dwelling units. With the zoning amendment, new multifamily housing would be feasible at the Menlo College campus and would provide housing for a range of income categories, most notable in the very-low to low and moderate income range.

Parking to meet school demand would need to be provided either below grade or in a structure
Site 2: An approximate 44,000 square foot (1 acre) surface parking lot is located in the southeast corner of the campus with frontage on Valparaiso Avenue and the school entry drive. A 75-foot setback for buildings higher than 22 feet is required by the zoning along the east property line. An emergency access road required by the Menlo Park Fire District exists within this 75-foot setback (perimeter fire road). At a density of 20- units per acre, this site could yield approximately 20 dwelling units.

To accommodate the new housing development, the zoning will be amended as follows:
● Rezone sites 1 and 2 to permit multifamily housing at a density of 20 units per acre
● Reduce the minimum front yard setback to 30 feet (along Valparaiso Road) ● Amend the height limit to allow 4 stories of 48 feet
● Permit multifamily housing by right with objective design standards With the zoning amendment, new multifamily housing would be feasible at the Menlo School campus and would provide housing for a range of income categories, most notable in the very-low to low and moderate income range. The new multifamily housing would also provide accessible units.

Sacred Heart – 150 Valparaiso Avenue
Sacred Heart Schools is a private preschool, K - 12 institution located at 150 Valparaiso Avenue on 60 acres of property serving approximately 1,195 students. The school site currently allows for the development of multiple-family residential uses, and adjacent