Agenda Report
Fullerton City Council
MEETING DATE: February 20, 2024
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: sunayana thomas, director of community and economic development
PREPARED BY: chris schaefer, aicp, planning manager
SUBJECT: housing element update status report
SUMMARY
The City began the Housing Element update in 2019 and submitted the initial draft to the California Department of Housing and Community Development (HCD) in November 2021. HCD provided corrections in January 2022 (Attachment 2). Staff prepared the revised draft Housing Element to submit for HCD review (Attachment 3) following several department staffing challenges .
PROPOSED MOTION
Provide feedback and comments to staff.
ALTERNATIVE OPTIONS
Approve the Proposed Motion
Other options brought by City Council.
STAFF RECOMMENDATION
Direct staff to submit the draft Housing Element document to HCD.
CITY MANAGER REMARKS
At this time staff is preparing to submit another draft to HCD for their review by March 2024. The City staff has been doing multiple presentations including to Planning Commission and to the public. This provides an opportunity for the City Council to see the status of the Housing Element.
The Housing Element is a state mandate that sets out the number of new housing units required in State and in each specific region of the state. Fullerton is in the region overseen by Southern California Association of Governments (SCAG). SCAG’s Board set the number of new housing units to be planned for in Fullerton which is 13,209 units. HCD also typically requires a contingency number above the 13,000 units.
This is a difficult task in Fullerton based on our land use development. In order to meet this requirement, prior to December 2021, staff began the process of utilizing the HIOZ methodology to meet the requirements.
If the City of Fullerton does not obtain a certified Housing Element, then there are State penalties which include limiting zoning and building oversight by the City.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statements:
Fiscal and Organizational Stability
Infrastructure and City Assets.
FISCAL IMPACT
A variety of sources fund the draft Housing Element document research and preparation and related studies, environmental review and preparation of the Housing Incentive Overlay Zone, including:
Local Early Action Planning (LEAP) Grant - $500,000 (100% allocated) SB-2 Planning Grant Program (PGP) - $310,000 (100% allocated) City General Funds - $146,500 (pending authorization).
Staff anticipates completing the remaining Housing Element work by the end of this year, including Planning Commission and City Council public hearings. The HCD review of the draft document, as well as any recommended changes, may impact the final cost to prepare the document. The State has withheld other funding such as the PLHA grant, which totals over $1 million to pay the City portion of the homeless shelter consortium (North County SPA) because the City does not have a certified Housing Element.
The Housing Element draft document will exceed grant funding. The City will cover the shortfall with $146,500 Housing Authority Funds with the City may expend for activities directly correlated to housing opportunity generation. The City may recover the shortfall if it receives the PLHA Calendar Year 2021 and 2022 funding allocations after housing element certification.
BACKGROUND AND DISCUSSION
California Government Code Section 65302 requires the City have a Housing Element. The General Plan, also referred to as the “Fullerton Plan,” contains the community vision for future City growth while the Housing Element focuses on housing attainment and preservation for residents of all economic levels and needs. Government Code Section 65588 requires Housing Element review and revision on a regular basis, coinciding with the Regional Housing Needs Assessment (RHNA) eight-year cycle.
State law requires the Housing Element address the following requirements:
Previous element review
Housing needs assessment
adequate sites inventory and analysis
Potential governmental and non-governmental constraints analysis Housing policies and programs
Quantified objectives.
The City Draft Housing Element addresses all requirements, organized into the following four chapters:
1. Introduction
2. Housing Needs Analysis
3. Resources and Constraints Analysis
4. Housing Policy Plan.
HCD determined the Housing Element first draft, submitted to HCD in November 2021, deficient in several areas and returned to the City with eleven pages of corrections (Attachment 2). These corrections included:
insufficient inventory of available housing sites
unrealistic housing production goals
lack of evaluation of past housing development activity lack of policies that would affirmatively further fair housing opportunities not addressing state-mandated policies and programs.
Staff and city consultants worked over the last fourteen months to address the items in the HCD correction letter (Attachment 4). Staff held several teleconferences with HCD staff to work through the details and believes that the Housing Element document now meets state requirements and resolves the corrections from the 2022 HCD letter. The draft Housing Element document is ready for submittal to HCD for review and confirmation that HCD requires no additional corrections.
The City must follow the timeline in a stipulated agreement and must finish all remaining tasks in the update process by December 2024. This includes completing the Housing Incentive Overlay Zone (HIOZ), a sub-component of the Housing Element. The HIOZ provides the major policy element to encourage housing development on non-residential zoned properties and help the City meet RHNA obligations. The RHNA requires the City facilitate development of 13,209 new residential units by the close of Cycle 6 at the end of 2029.
The next steps in the process include finalizing the Housing Incentive Overlay Zone map, completing the related development standards and making the related General Plan updates. Staff intends to bring the draft HIOZ development standards to Planning Commission in April or May 2024 as a study session item and review the Preliminary Environmental Impact Report (PEIR) in May 2024.
Staff plans to present he final Housing Element, HIOZ and PEIR documents to Planning Commission and City Council in late fall or early winter 2024 for adoption. The City must complete rezoning, municipal code amendments and general plan amendments by December 2024 to meet the stipulated agreement requirements. Major changes or revisions to any of the documents may affect the timeline and could subject the City to various penalties, as shown in the attached HCD document (Attachment 5).
Attachments:
Attachment 1 - PowerPoint Presentation
Attachment 2 - HCD Letter Dated January 27, 2022
Attachment 3 - Draft Housing Element Dated January 2024 Attachment 4 - Fullerton Housing Element Update Summary Attachment 5 - HCD Compliance Information Sheet
cc: City Manager Eric J. Levitt
Housing Element Update Status Report
February 20, 2024 - Page 2