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May 10, 2022
ITEM TITLE
Grant Award: Accept Funds from the San Diego Association of Governments’ (“SANDAG”) Housing Acceleration Program to Implement the City of Chula Vista Accessory Dwelling Unit Assistance Program Report Number: 22-0036
Location: No specific geographic location
Department: Development Services
Environmental Notice : The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act (“CEQA”) State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
Recommended Action
Adopt resolutions: A) City Council a uthorizing the acceptance of a $180 ,719.68 Housing Acceleration Program grant from the San Diego Association of Governments (“SANDAG”) to implement the City of Chula Vista Accessory Dwelling Unit (“ ADU”) Assistance Progra m, and appropriating SANDAG funds for th at purpose; and B) City Council and Housing Authority approving and appropriating $200,000 in Housing Authority Inclusionary Funds as matching funds for an Accessory Dwelling Unit pilot loan program . (4/5 vote required)
SUMMARY
In January 2022 , the City of Chula Vista submitted a proposal for funding through the SANDAG Housing Acceleration Program (“HAP”) to create the City of Chula Vista ADU Assistance Program. In March 2022, the City of Chula Vista received notification of award for the program in the amount of $180,719.68.
This item seeks to formally accept the grant funds, authorize and direct the City Manager or designee to execute documents necessary to obtain and execute the grant, and appropriate the grant funds. In addition, this item approves and appropriates $200,000 in matching funds from the Chula Vista Housing Authority’s Inclusionary Housing Fund for the purpose of establishing a pilot loan program for ADU production.
ENVIRONMENTAL REVIEW
The Director of Development Services has reviewed the proposed activity for compliance with the CEQA and has determined that the activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore, pursuant to Section P a g e | 2
15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. Thus, no environmental review is required.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
No recommendation is required; however, on April 19, 2022, staff presented the proposed ADU program to the Housing Advisory Comm ission with an overall positive response to the program. No official vote was taken on the presentation. Staff will provide information on this new program to t he Planning Commission at a future meeting.
DISCUSSION
In 2019, the California State Assembly passed AB 671, which required local governments to include plans to incentivize and promote the creation of ADUs in the Housing Element of their General Plan. The City of Chula Vista’s 2021 -2029 Housing Element outlines various housing policies to accommodate and promote the construction of affordable ADUs, particularly for special needs groups, seniors, and persons with disabilities.
Housing Policies 2.11 and 2.12 within the Housing Element (pages H -52 and H-54, respectively) would be achieved by t he creation of this ADU assistance program. These housing policies specifically listed exploration of permit ready ADU s as a goal to be completed withing 12 months of adopting the City’s June 2021 ADU Ordinance.
In the Fall of 2021, SANDAG solicited applications for its HAP, which aims to fund planning activities that will accelerate housing production, facilitate implementation of the 6th Cycle Regional Housing Needs Assessment (“RHNA”), and build local jurisdictions’ capacity to compete for funding state wide through the California Department of Housing and Community Development (“HCD”) Prohousing Designation Program.
The HAP program provides grants and technical assistance to local jurisdictions to accelerate housing production as well as promote equity and sustainability in housing planning and production. In late January 2022, the City submitted a HAP bid to establish the Chula Vista ADU Assistance program and received formal approval of the bid from the SANDAG Board of Directors on March 11, 2022.
Proposed Program Overview
The proposed ADU Assistance program will accomplish various goals defined in the City’s 2021 -2029 Housing Element. The $180,719.68 in HAP funds will allow Chula Vista to establish a webpage for all aspects of building an ADU in th e City. Attachment No. 1 contains a detailed Scope, Schedule and Budget for the proposed program. The website will feature the following:
Pre-approved ADU designs;
Property specific planning software; and
ADU Frequently Asked Questions (“FAQs”).
The following program elements will be implemented between Spring 2022 and June 2023 using SANDAG HAP and matching funds:
Easily accessible webpage.
The program will primarily be accessed through the City’s ADU webpage, which will become a one stop shop for ADU planning and permitting. This webpage will feature links to all of the items described below, a link to permitting fees and submittal requirements, and a detailed list of FAQs developed by City staff.
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Creation and publication of pre-approved ADU plans.
Pre-approved ADU plans will substantially reduce costs and reduce the overall permitting process timeline for homeowners interested in constructing ADU s. With the program’s implementation, it is anticipated that overall permitting for ADUs could be reduced to under four months. The City of Encinitas, and other jurisdictions within the region, have implemented successful pre -approved ADU plan programs. Request for Qualifications (“RFQs”) for pre -approved plan creation will be developed and released in the near future.
Planning software application.
The City will partner with a software developer to crea te an application that allows homeowners to explore where pre-approved plans can be placed on their property. The application will be user friendly and will include preprogrammed planning regulations like setback s and zoning specific to the City of Chula Vista.
Frequently Asked Questions (FAQs).
The webpage will also feature common questions and answers about ADUs and City processes, including project submittal and required fees associated with ADU construction. ADU Pilot Loan Program.
The SANDAG HAP application identified $200,000 in Housing Funds as matching funds, for a pilot program with priority for existing participants of Chula Vista's First -Time Homebuyer Program to provide deferred low -interest loans for ADU construction. These properties are deed restricted for affordability. This ensures that the pilot program promotes ADU construction for low -income households. The goals of this pilot program are the following:
Provide more low-income housing opportunities near transit rich portions of the city; Provide homeowners with an extra source of income; and Assess the feasibility of additional loan programs for ADU production.
Future ADU Program Goals for Chula Vista
Acceptance of the HAP funds will mark the first step in creating a larger Chula Vista ADU program that will accomplish the ADU goals established in the 2021-2029 Chula Vista Housing Element.
Future efforts of the City’s ADU p rogram may also include assistance for converting garages into ADU s and an amnesty fee offset for existing un-permitted ADUs. Overall, these actions and programs will advance the City’s ability to utilize ADUs as a source of affordable housing, putting the City on track to meet objectives of the mid-cycle ADU Production Evaluation described in the 2021-2029 Housing Element.
Conclusion
The proposed program will advance opportunities to provide housing options throughout the City of Chula Vista and will create a streamlined process for ADU constructio n. The acceleration of ADU construction through the City of Chula Vista ADU Assistance program will add to the City’s housing stock, while providing low-income households with additional income, and further City goals related to:
Housing Equity - The program’s pilot for the deferred low -interest loans will take place in households primarily located in Western portion of Chula Vista. Much of Western Chula Vista contains low -mod census tracts as defined by the U.S. Department of Housing and Urban Development. Many programs P a g e | 4
managed by the City, community organizations and school districts have focused efforts on providing equitable opportunity for families and individuals to access services and opportunities within this area of the city. The ADU Assistance program will further this effort to help revitalize some of the city’s aging housing stock and provide opportunity to house individuals with an affordable new option in areas with accessible transportation to services.
Sustainability - Since the ADU program would be piloted in homes in the western portion of the city, the first ADUs constructed under the program would be in the portion of the City with the highest concentration of transit corridors, therefore reducing the need for more vehicles and the distance needed to travel by vehicle for the new residents residing in the ADUs . This supports achievement of the sustainability and carbon reduction goals establish in the Climate Action Plan adopted by the City in 2017.
The proposed action: (1) approves acceptance of the SANDAG HAP grant ($180,719.68) (2) authorizes and directs the City Manager or designee to execute agreements necessary to obtain the SANDAG HAP grant , including approval of the S ANDAG Grant Agreement as provided in Attachment No. 2, and to execute additional necessary agreements to meet grant deliverables ; and (3) appropriate funds provided by the SANDAG HAP grant ( $180,719.68) and Housing Authority matching funds ($200,000) for program implementation.
DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently, the real property holdings of the City Council member/Housing Authority Commission er do not create a disqualifying real property -related financial conflict of interest under the Political Reform Act (Cal. Gov't Code § 87100, et seq.).
However, Councilmember McCann may have a conflict due to his ownership of multiple rental properties.
CURRENT-YEAR FISCAL IMPACT
There is no current year fiscal impact to the General Fund as a result of this action. Staff time to prepare the grant application is budgeted in the Housing Authority Fund. Approving the resolution appropriates $180,719.68 in Housing Acceleration Program grant funds and $200,000 in matching Housing Authority Inclusionary funds in the current fiscal year.
ONGOING FISCAL IMPACT
There is no ongoing fiscal impact to the General Fund as a result of this action. All costs associated with the administration of the HAP Grant Agreement and funded activities will be covered by the grant and available Housing Authority Inclusionary funds.
ATTACHMENTS
1. HAP Scope Schedule and Budget
2. SANDAG HAP Grant Agreement
Staff Contact: Mark Barnard, Management Analyst
Tiffany Allen, Director of Development Services