Cotati City Council
Agenda Staff Report
Item type: CONSENT CALENDAR (ACTION)
To: City Council
Subject: SECOND READING AND ADOPTION OF AN ORDINANCE
AMENDING CHAPTER 17.32 DENSITY BONUSES OF THE
COTATI MUNICIPAL CODE
Date: September 24, 2024
Written by: Noah Housh, Director of Community Development Recommendation
It is recommended by the Community Development Department and the Planning Commission that the City Council conduct the second reading and adopt the ordinance amending Chapter
17.32 Density Bonuses of the Cotati Municipal Code.
Background
California Density Bonus law provides a mechanism for developers of residential housing projects to request additional units (above those allowed under the “base” density) in exchange for constructing a percentage of a project as deed restricted affordable housing. The general concept is that granting additional market rate units helps to offset the costs of providing the below market rate affordable housing units. Historically, the granting of density bonus was at the discretion of the individual cities/counties where the projects were being built.
The recent changes to statewide housing legislation intended to promote construction of additional housing have included several changes to the state density bonus law. Some of the most influential changes have included making granting of a density bonus required when a development meets certain criteria; expanding on the number of “incentives and concessions” from local development regulations developers may request to further support the construction of the affordable housing units; and modifying the percentages of affordable and market rate housing units that make up the density bonus formula.
Although changes at the state level are legally binding and affect all jurisdictions throughout the state, it is expected that each local jurisdiction adopt “implementing legislation” to incorporate these statewide requirements into local ordinances and municipal codes. This update to the City of Cotati Density Bonus ordinance is in response to recent changes in state density bonus requirements.
On June 14, 2024, the Planning Commission held a public hearing to consider the proposed code changes and a resolution making a recommendation to the City Council regarding introduction of the ordinance. At this meeting the Planning Commission voted 4-0-1 (Commissioner Gilardi absent) to recommend the City Council adopt the draft ordinance.
On August 27, 2024, the City Council considered the draft ordinance and directed staff to make some minor revisions prior to introducing and conducting the first reading.
Analysis/Discussion
Project Description
City Council consideration, and second reading of a draft ordinance amending and updating Chapter 17.32 Density Bonuses of the Cotati Municipal Code to establish compliance with changes in state density bonus law.
Land Use and Planning Considerations
Historically, local regulations intended to implement state density bonus legislation were written to copy exactly the state law language including affordability formulas, parking requirements and the criteria for granting incentives and concessions for density bonus projects. Additional language specific to the jurisdiction’s process or unique elements was then added onto the copied language to make up a local ordinance. This approach generally worked because the requirements and regulations adopted by the state rarely changed so the jurisdiction’s versions of these regulations did not have to change often to remain in compliance.
However, in recent times, the state legislature has been focused on making significant changes to housing law in an effort to spur housing development and has continued to iterate on these changes as in subsequent years. With regards to state density bonus law, there have been no fewer than eight bills passed by the state legislature modifying these regulations since 2018 (SB 1227; SB 1085; SB 728; AB 634; SB 728; SB 290 (2021); AB 2345 and SB 290 (2022)). This constant change to the rules governing policies must be implemented through local amendments to adopted regulations using the ordinance process for local regulations to be in compliance.
Given the need for constant revision and limited staff resources, staff is proposing a change in how staff drafts, and the Council, adopts the required implementing legislation.
Rather than copy the language of state law verbatim, the ordinance before the City Council simply references the requirements of the state legislation. Further, this draft ordinance language does not identify the specific code sections of state law, rather it limits any references to state legislation to the subject matter being discussed (and does not identify the government code sections in question). The goal of this approach is that as the state legislation continues to be updated and reorganized in response to newly adopted bills at the state level, the adopted Cotati legislation will remain compliant. Staff is proposing this approach to keep the local regulations compliant both in response to the pace of change at the state level, as well as the culture of compliance being prioritized by the Department of Housing and Community Development (HCD).
Separate from this “housekeeping” effort to update the City’s Density Bonus ordinance to ensure compliance with state law, the ordinance maintains the previously adopted “Mixed-Use Density Bonus”. Additionally, the proposed language codifies that the “land-trust” model is the City’s preferred method for managing the initial sale, re-sale and compliance monitoring of for-sale affordable housing units within the City of Cotati. This model essentially puts a non-profit land trust entity onto the title of below market rate units sold to qualifying residents. Having this additional entity on the title of the property ensures an agent of the City is involved with every transaction of that property. Codifying this model as the preference for managing the for-sale affordable housing stock within the City implements Housing Element Program 1-3 (Non-Profit and Agency Coordination) and Program 1-5 Preservation of Affordable Housing.
Lastly, at the direction of the Council staff removed any reference to the “Cotati Density Bonus”, discussed at the May 28, 2024, housing workshop and the August 28, 2024, Council meeting.
The Cotati Density Bonus will be brought back for consideration through a separate Ordinance which is focused purely on this change to the CMC.
IV. General Plan Consistency
The amendments to CMC Title 17 in the proposed ordinance are consistent with and will further established goals, policies, and implementation programs of the General Plan, including the Housing Element, to expand housing opportunities, conserve resources, and use land appropriately.
Specifically, these amendments are consistent with and implement the following Housing Element policies and programs:
Program 1-8: Residential Building Decarbonization: Continue to permit and encourage mixed uses and higher densities on in-fill and vacant sites in Priority Development Areas (PDAs) with public serving facilities, such as medical clinics, schools, and grocery stores, to discourage sprawl and encourage short vehicle trips and/or alternative forms of transportation.
Program 3-1: Zoning for a Variety of Housing Types: Amend the City’s Zoning Code to use the maximum parking requirements in Government Code Section 65915 (State Density Bonus) for all multifamily projects without the need for any developer request by December 2023.
In addition, these amendments are consistent with and implement the following General Plan policies and programs:
Policy CON 2.1: Improve air quality through continuing to require a compact development pattern that focuses growth in and around existing urbanized areas, locating new housing near places of employment, encouraging alternative modes of transportation, and requiring projects to mitigate significant air quality impacts.
Policy LU 2.5: Locate medium and higher density housing within easy walking or bicycling distance of public facilities, services, transit, and major employers.
Policy LU 2.10: Encourage mixed-use, pedestrian-, and transit-oriented development, with a focus on the Hub and major corridors.
Staff Response: Staff finds that the proposed amendments to Chapter 17.32 Density Bonuses implement the above referenced Housing Element and General Plan policies in that additional density allowed in density bonus projects will increase incentives for in-fill development and provide additional residential units in close proximity to local amenities and employment opportunities; further support implementation of the density bonus parking allowances; support increased compact development and housing near local employment and supporting the use of alternative transportation methods; and further encourage mixed use and transit oriented development through clarifying the increased allowable density, including around the Hub and major corridors.
Planning Commission Review
During their June 17, 2024, review of the code changes, the Planning Commission was generally supportive of the changes and approach being recommended by City staff. In addition to supporting formally identifying the “land trust” model as the most appropriate for the City, Commissioners saw the benefits of the City providing incentives beyond those offered through the State Density Bonus program. Specifically, identifying the creation of a mechanism to gain compliance with Cotati development standards, providing options to secure a greater variety of affordable housing and allowing additional housing units to be constructed when the City determines it appropriate. After their discussion, the Commission voted 4-0 (one commissioner absent) to recommend the City Council adopt the ordinance. Given that the Cotati Density Bonus will be a separate ordinance, this change will be taken back to the Planning Commission for consideration and a recommendation prior to being brought to the Council for their review.
Financial Considerations
Other than the staff time to draft the ordinance, there are no direct impacts to the general fund anticipated as a result of adopting the proposed ordinance.
Environmental Issues
In conformance with California Environmental Quality Act (CEQA), the Community Development Department, Planning Division staff finds that the proposed amendments to the Cotati Land Use Code related to density bonus are consistent with and implement the goals, policies, and objectives of the 2015 General Plan, the 2023-2031 Housing Element and state density bonus law. Given this staff finds that these proposed revisions conform to CEQA Guidelines Section 15183, which provides a streamlined review of the environmental impacts of the project by tiering from the program level analysis prepared for the Cotati General Plan and its certified EIR, and other previously completed environmental analysis. Section 15183 of the CEQA Guidelines mandates that projects which are determined to be consistent with the development expectations established by existing zoning, community plan, or general plan policies for which an EIR was certified, shall not require additional environmental review, except as might be necessary to examine project-specific significant effects which are peculiar to the project or its site. This focused analysis should be limited to potential environmental impacts of the project not anticipated or analyzed in the Cotati General Plan’s program level EIR.
Staff finds that all adopted mitigating General Plan policies, mitigation measures identified in the 2015 General Plan EIR and Housing Element Mitigated Negative Declaration will address any potential environmental impacts of the proposed code changes. Further, these changes are being mandated by updates to state density bonus law and future project-specific environmental analysis of any housing development proposed under the amended Code will be required and will allow project-specific impacts not previously identified or anticipated to be addressed.
Summary and Staff Recommendation
It is recommended by the Community Development Department and the Planning Commission, that the City Council review and conduct the second reading of the proposed ordinance amending Chapter 17.32 Density Bonuses of the Cotati Municipal Code.