DATE: 09/18/2024
TO: Honorable Mayor and City Council Members
FROM: Planning and Development Department
2024-37
REQUEST FOR CITY COUNCIL ACTION
SUBJECT:
REQUEST BY COUNCIL MEMBER SPEAKE ASKING THE CITY COUNCIL TO
CONSIDER STUDYING AN INCLUSIONARY HOUSING ORDINANCE FOR MULTIPLE
FAMILY RESIDENTIAL DEVELOPMENTS
EXECUTIVE SUMMARY:
This staff report asks the City Council to provide direction to whether it wishes staff to undertake a multi-year effort looking at the possibility of adopting an inclusionary housing ordinance for the City.
RECOMMENDED ACTION:
That the City Council provide direction on whether it wishes staff begin undertaking the necessary steps necessary to consider the preparation of an inclusionary housing ordinance.
BACKGROUND & HISTORY:
Council Member Speak submitted a future agenda request regarding the possibility of adopting an inclusionary housing ordinance for multiple family residential developments.
The request is to have staff provide the City Council with options for an inclusionary housing ordinance that includes examples from various cities.
ANALYSIS:
What is an Inclusionary Housing Ordinance
An inclusionary housing ordinance typically requires a portion of new residential construction of a certain amount to provide a certain percentage of residential units to be set aside for the sale or rent to low- or moderate-income households to increase the availability of affordable housing, or as an alternative pay the city a fee in lieu of building affordable units. The in-lieu fee would be dedicated to affordable housing and managed by the City’s Housing Authority to facilitate the construction, acquisition and preservation of affordable housing.
City of Riverside’s Process in the Creation of an Inclusionary Housing Ordinance City staff has not yet researched the number of inclusionary housing ordinances that have been adopted by various cities in the region. However, staff is aware of the process that has been taken by the City of Riverside in trying to adopt an inclusionary housing ordinance. Riverside’s process is a good example of the process that may need to occur in Corona given that it is a neighboring city and in the Western Riverside County region.
The following table describes the timeline and the process that the City of Riverside has taken to date in trying to adopt an inclusionary housing ordinance. The City of Riverside has not yet adopted an inclusionary housing ordinance since it started the process over three years ago.
Date Action
May 2021 Initiated the hiring of a consultant to prepare a feasibility study on implementing an inclusionary housing ordinance.
November 2021 Two separate virtual stakeholder meetings with affordable housing developers and advocates, and market rate housing developers and businesses.
January 2022 Two separate virtual community webinars.
June 2022 Stakeholder meeting with the Greater Riverside Chamber of Commerce Economic Development Council.
August 2022 Planning Commission hearing.
October 2022 Planning Commission hearing and workshop (item continued to November).
November 2022 Planning Commission hearing and workshop (item continued off calendar).
November 2022 Staff re-engaged the consultant to prepare an updated feasibility study due to changes in the housing market.
October 2023 Updated feasibility study and revised inclusionary housing ordinance recommendations presented to the Housing and Homeless Committee.
Market changes showed inclusionary housing to be feasible for single family housing (low and high density) and not multifamily housing.
November 2023 Stakeholder meeting with the Greater Riverside Chamber of Commerce Economic Development Council.
December 2023 Planning Commission hearing. Item continued off calendar with staff to provide additional outreach to the Building Industry Association and provide policy performance projections, impacts to housing costs, and include language in the ordinance that would require affordable housing units to be set aside in multifamily housing.
Facts for the City Council to Consider In Studying an Inclusionary Housing Ordinance The following describes the items that the Council will need to consider if staff is directed to consider studying the preparation of an inclusionary housing ordinance. Feasibility Study. The City should perform a feasibility analysis to understand the latest housing market concerning construction costs for all housing types, sale prices, and rental prices; and the percentage of each income category (very low, low, or moderate) that should be applied to new residential construction of a certain amount.
Housing Type. Depending on the feasibility analysis, inclusionary housing may not be limited to new multifamily construction and can include new single-family construction, which was the case in the City of Riverside. Example Ordinances from Cities. Examples would be limited to the Riverside County region because of comparable housing costs and rents and the average median income of the county.
Density Bonus Law. The state density bonus law allows for the waiver of development standards if a project is an affordable housing development, which includes mixed-income housing. Waivers of development standards under the state density bonus law could be used for new residential construction required to provide affordable housing units.
Public Outreach. Staff would need to do outreach to home builders, the Building Industry Association, and stakeholders interested in affordable housing. City Council Study Sessions. Staff would need to update the Council on its findings and obtain direction from the Council at study sessions. Time. It is anticipated that staff will need to spend approximately 18 months or more on this process.
Cost. The City would need to hire a consultant to prepare a feasibility study and attend stakeholder meetings and public meetings with city staff. The cost for this is unknown at this time.
Ongoing Review of the Feasibility of an Inclusionary Housing Ordinance. An inclusionary housing ordinance would likely need periodic updates to align with changes in the housing market.
FINANCIAL IMPACT:
This task will require approximately 2,000 hours of staff time, in addition to an estimated cost of $250,000 to complete a feasibility study, for a combined estimated cost of $400,000. These funds and staff time are currently not allocated in the FY25 Budget.
PREPARED BY: JOANNE COLETTA, PLANNING AND DEVELOPMENT DIRECTOR ATTACHMENTS:
1. Exhibit 1 – Request by Council Member Speake