Agenda packet, study session — Los Altos City Council, November 29, 2022

CITY COUNCIL STUDY

SESSION - HOUSING

ELEMENT UPDATE
AGENDA
5:30 PM - Tuesday, November 29, 2022
Video Conference and In Person
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Public testimony will be taken at the direction of the Mayor, and members of the public may only comment during times allotted for public comments.

AGENDA

MEETING CALLED TO ORDER

CONFIRM QUORUM
1 11/29/2022 CITY COUNCIL STUDY SESSION - HOUSING ELEMENT UPDATE AGENDA Page 2 of 2

PUBLIC COMMENT ON AGENDA ITEM

DISCUSSION ITEM

1. Sixth Cycle Housing Element 2023-2021: Study Session with the Los Altos City Council on the status of the Sixth Cycle Housing Element 2023-2031, and report on initial findings letter from the Department of Housing and Community Development (HCD) post 90-day review, and proposed timeline and response to required amendments to the draft Housing Element to comply with State law (N. Zornes)

ADJOURNMENT

SPECIAL NOTICES TO THE PUBLIC
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On occasion the City COuncil may consider agenda items out of order. 2 AGENDA REPORT SUMMARY

Meeting Date: November 29, 2022
Subject: Study Session with the Los Altos City Council regarding status of the Sixth Cycle Housing Element 2023-2031, and report on initial findings letter from the Department of Housing and Community Development (HCD) post 90-day review, and proposed timeline and response to required amendments to the draft Housing Element to comply with State law.

Prepared by: Nick Zornes, Development Services Director Attachment(s):

1. November 10, 2022, Findings Letter from HCD regarding City of Los Altos 6 th Cycle Housing
Element.

Environmental Review:

The action before the City Council is statutorily exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15262, Feasibility and Planning Studies. The direction is not a final action or approval in regard to the Housing Element Update and does not have a legally binding effect on any possible future discretionary action.

Background:

Every eight years the State requires that each jurisdiction update its Housing Element to address future housing needs. The Department of Housing and Community Development (HCD) is the agency responsible for tracking and determining compliance with the State Housing Law. The City must adopt the 6th Cycle Housing Element Update (2023-2031) by January 31, 2023.

There are consequences for the city if the Housing Element is adopted after January 31, 2023, or if the Housing Element is not found to be in substantial conformance with State law within 120- days after the statutory due date of January 31, 2023. If a Housing Element is not in substantial conformance with State law, the City will be vulnerable to litigation by the State Attorney General and other interested parties, be potentially ineligible for some state and regional funding, and other penalties as allowed by State law or as determined by a court.

The Regional Housing Needs Allocation (RHNA) methodology for the 6th Cycle (2023-2031) was established by the Association of Bay Area Governments (ABAG) and approved by the Department of Housing and Community Development Department (HCD).

City of Los Altos final allocation is 1,958 units which are distributed between the following four (4) income categories:
3 Agenda Item 1.

Subject: Study Session with the Los Altos City Council regarding status of the Sixth Cycle Housing Element 2023-2031, and report on initial findings letter from the Department of Housing and Community Development (HCD) post 90-day review, and proposed timeline and response to required amendments to the draft Housing Element to comply with State law.

November 29, 2022 Page 2
• Very Low Income (Less than 50% of Area Median Income): 501 units • Low Income (50-80% of Area Median Income): 288 units
• Moderate Income (80-120% of Area Median Income): 326 units • Above Moderate Income (More than 120% of Area Median Income): 843 units On April 26, 2022, at a Joint Session Planning Commission and City Council meeting. On June 22, 2022, the City of Los Altos made available the Public Review Draft of the Sixth Cycle Housing Element 2023-2031, opening the required minimum 30-day public participation requirement On July 7, 2022, the Public Review Draft was presented to the Planning Commission. On July 12, 2022, the City Council meeting, accepted public testimony regarding the Public Review Draft, discussed the draft, and directed staff to consider and incorporate appropriate public comments into the Draft Housing Element during the required 10 business days, and then transmit the document for HCD’s formal first review.

The City formally submitted the first Draft of the Sixth Cycle Housing Element on August 12, 2022, to HCD. During HCD’s 90-day review, the City received initial verbal comment from HCD prior to receiving the department formal Findings Letter. On November 10, 2022, the City of Los Altos received its formal comment letter from HCD regarding the Draft Sixth Cycle Housing Element (Attachment 1).

Housing Element Update Timeline:

City Council Study Session 11/29/2022
OPEN Public Review (30-days)
Initial Study-Mitigated Negative Declaration
11/30/2022
CLOSE Public Review
Initial Study-Mitigated Negative Declaration
12/30/2022 at 5:00pm
Planning Commission Hearing 1/5/2023
City Council Hearing 1/24/2023
Housing Element Adoption-Statutory Due Date 1-31-2023
The timeline presented above reflects the critical milestones that the City must adhere to in order to adopt and be found to be in substantial compliance by HCD. The City will continue to engage the community throughout the development of the Sixth Cycle Housing Element until it is found to be in substantial compliance with housing element law. 4 Agenda Item 1.

November 29, 2022 Page 3
On-time Housing Element Importance:

The City must adopt the Sixth Cycle Housing Element 2023-2031 by January 31, 2023. The City must be found to be in substantial compliance (meaning a letter from HCD affirming compliance with Housing Element Law) within 120-days of the statutory deadline of January 31, 2023. If the City is not found in substantial compliance within 120-days of the statutory deadline, all rezoning required within the housing element shall be completed within one year of the housing element due date (as opposed to three years) to maintain housing element compliance. Additionally, an approved Housing Element makes Los Altos eligible for a variety of State grants, including funds for affordable housing, parks, and infrastructure. If the City does not meet its deadline to adopt its updated Housing Element, it could face fines and lawsuits from the State. A court may limit local land use decision-making authority until the City brings its Housing Element into compliance, and ultimately a receiver may be appointed by the court to take control of City operations as necessary to bring the City into substantial compliance with the Housing Element Law.

Public Participation
Local governments shall make a diligent effort to achieve public participation of all economic segments of the community in the development of the Housing Element, and the element shall describe this effort. (Gov. Code, § 65583(c)(9).)
• Public Participation is a fundamental of any housing element. As noted in HCD’s Findings Letter the draft housing element summarizes the public participation that was completed, however the City must further demonstrate how it included all economic segments of the community. Additionally, the City must commit to additional public participation in the future, and deploy methods that specifically includes lower-income and special needs households. To further help shape the development of programs identified in the housing element, the City must commit to further involving all segments of the community to gain comments that will provide meaningful change and further help to create affordable housing in Los Altos.
• On Friday, November 18, 2022, Director Zornes met with five members of The Los Altos Affordable Housing Alliance virtually for a 2-hour meeting to discuss HCD’s Findings Letter, and potential solutions for the City to consider to be found in substantial compliance.
5 Agenda Item 1.

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• On December 7, 2022, Director Zornes will present to the Los Altos Chamber of Commerce regarding the status of the City’s Sixth Cycle Housing Element. The chamber reached out to Director Zornes requesting a presentation on the Housing Element, which was happily accepted.
• On December 16, 2022, Director Zornes will present to the Los Altos Community Coalition regarding HCD’s Findings Letter, and what is next for the Sixth Cycle Housing Element.

The Coalition reached out to Director Zornes requesting a presentation and discussion on the Housing Element, which was happily accepted.
• Requests for additional outreach are welcomed by the Development Services Director, as this helps to further facilitate meaningful dialogue with the Los Altos Community. Director Zornes will also be looking for opportunities to meet with the Community and any interested parties to discuss the Housing Element, and how we can further better the Planning Process here in Los Altos.

Analysis:

The HCD Findings Letter dated November 10, 2022, provided comments that were organized under the following topics: Housing Needs, Resources, and Constraints, Housing Programs and Public Participation. A summary of HCD’s comments and discussion are provided below.

Housing Needs, Resources, and Constraints

1. Affirmatively furthering fair housing in accordance with Chapter 15 (commencing with Section 8899.50) of Division 1 of Title 2…shall include an assessment of fair housing in the jurisdiction. (Gov. Code, § 65583(c)(10)(A).)
• AFFH was first required with the adoption of AB 686 which was signed in 2018.

Importantly AB 686 also created new housing element requirements applying to all housing elements due to be revised on or after January 1, 2021. This is the first housing element for the City of Los Altos where the specific requirement for Affirmatively Furthering fair Housing must be included within our analysis. The goal of Affirmatively Furthering Fair Housing (AFFH) is to combat housing discrimination, eliminate racial bias, undo historic patterns of segregation, and lift barriers that restrict access in order to foster inclusive communities and achieve racial equity, fair housing choice, and opportunity for all Californians. o In general, the City’s AFFH section of the draft housing element is strong but does require additional data to be incorporated into the document.

Important to note is that some of the data already is within the draft housing 6 Agenda Item 1.

November 29, 2022 Page 5
element however revisions will be required to link or indicate where in the document information is located.

2. Include an analysis and documentation of household characteristics, including level of payment compared to ability to pay, housing characteristics, including overcrowding, and housing stock condition. (Gov. Code, § 65583(a)(2).)
• Overpayment and Housing Costs sections within the draft housing element must quantify and analyze existing data within the document or provide additional information. The draft housing element must add or modify policies and programs as appropriate which support this requirement.

Code, § 65583(a)(3).)
• In general, HCD’s Findings Letter articulates fundamentals for the site inventory analysis which is required of all housing elements. Progress towards meeting RHNA will require the City to provide additional analysis of “Pipeline” projects and the probability of those projects being constructed in the Planning Period (2023-2031). City staff if confident that the all-pipeline projects will be constructed within the Planning Period as the majority of those projects/units have submitted their construction documents to the city for Plan Check. • Additional information will be provided within the draft housing element which supports the capacity assumptions that have been made for sites. Analysis such that reviews the development activity within nonresidential zones, and how frequent residential development occurs will be further supported. This analysis is supported by the zoning within the City already allows for the creation of residential units within many nonresidential zones i.e. mixed use zones.
• The draft housing element relies heavily on nonvacant sites; over 50% of sites identified. This is common in most jurisdictions that are close to buildout much like the City of Los Altos. The draft housing element must further demonstrate that the existing uses is not an impediment to additional residential development; should impediments be identified the City must further demonstrate how programs and policies will support the development of residential uses on nonvacant sites. • Environmental constraints must be analyzed within the draft housing element.

Further analysis will be included that assesses the seismic activity and wildfire threats and whether those will impact the creation of additional housing. 7 Agenda Item 1.

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• The City is required to provide an Electronic Sites Inventory pursuant to government Code section 65583.3; the City will complete this as required by law. • Accessory Dwelling Unit ordinance shall comply with State law at all times. The City understands this requirement and will further add a program that clearly demonstrates this requirement as requested within the HCD Findings Letter. o Additional information was provided to City staff during a preliminary call with HCD. The City’s ADU Ordinance has been determined to be inconsistent with State law, and revisions will be necessary. HCD verbally and in writing has stated that the City will receive a letter regarding noncompliance issues under a separate cover which will require zoning code amendments. Director Zornes will promptly review the letter of noncompliance and with consultation of the City Attorney will draft amendments to the zoning code based on HCD’s noncompliance letter. • The draft housing element must further demonstrate that Emergency Shelters are allowed within the City, and clearly show what zones they are allowed by-right.

Furthermore, the City must clarify that no discretionary action is required, what is the allowed capacity of an Emergency Shelter and the parking requirements. This will be accomplished by further clarifications in existing programs within the draft housing element.
• Single Room Occupancy Units must clarify the procedures for permitting which encourages their development as well as clearly demonstrating what zones they are permitted within.
• The draft housing element must clearly demonstrate that Manufactured Housing is allowed within the City and does not require any additional review in order to be located within the City.

November 29, 2022 Page 7
• Minimum Unit Sizes. The Loyola Corner Specific Plan has a requirement for Minimum Unit Sizes, this requirement as well as other land use controls has not been enforceable since the adoption of the Housing Crisis Act. In order to demonstrate compliance, the City of Los Altos must formally remove this requirement as it is inconsistent with California Housing Law. • Parking Requirements. The draft housing element identifies a parking study shall be completed for the Downtown Area of Los Altos, however HCD’s Findings Letter requires the City to expand this analysis to all parking requirements within the City. This will be included within the revisions to the housing element. • Fees and Exactions. The City will include a program that analyzes the Development Fee Schedule within Los Altos. A specific commitment to updating the City’s Fee Schedule will be required for the draft housing element to be approved by HCD. In general, the City of Los Altos has an out-of-date fee schedule which is ripe for review and updating.
• Zoning and Fees Transparency. The City already is compliant with this requirement, however the draft housing element will further demonstrate how the City is already in compliance with the State law.
• Local Processing and Permit Procedures. The draft housing element must further indicate what is the average time for review of projects, what impediments likely result in delays, and how many hearings on average housing development projects are reviewed by. In general, the City must provide a commitment to streamlining the review process of housing developments which will result in fewer hearing bodies reviewing each project.

Housing Programs

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• PROGRAM 1.D: housing on church owned sites. This must be completed earlier in the planning period. Staff recommends completion of this no later than December 2025, effectively this results in one year sooner than initial proposal. • PROGRAM 1.E: staff believes there was an error with this comment as it requests the city to remove an objective standard which is inherently something that is allowed by State law, this might have been meant as Subjective, however staff is uncertain and will seek further clarification. It is important to note that the Loyola Specific Plan is very out of date, and has several errors throughout the document, with several requirements that are unenforceable given the Housing Crisis Act.
• PROGRAM 1.H: the city must identify specific incentives it is willing to commit to for the development of housing on city owned parking plaza 7 and 8. This could come in the form of Fee Waivers, or low-cost land leases.
• PROGRAM 1.I: lot consolidation within the downtown area must commit to specific incentives.
• PROGRAM 2.A: inclusionary housing program must commit to modification of the city fee schedule to address constraints in the development of affordable housing units. • PROGRAM 2.C: affordable housing fund which will be further established with an overall fee schedule update must provide outreach to developers to understand the trends of the market.
• PROGRAM 3.A: the program specifically limits a parking study to the downtown area, although that still can be accomplished and overall review and update to parking standards must be provided within the scope of the program. • PROGRAM 3.B: building heights in mixed-use zones must specify the number of stories that will be allowed included with the increase of building heights. • PROGRAM 3.H: redesignation of design review and appeal authority is greatly needed as identified in the proposed program; however, the City must include specific limitations on what is a qualifying appeal and for what specific projects that will be allowed for. This will be included with the overall appeal authority matrix that was previously discussed with the City Council at the July 2022 Public Hearing. Lastly, the City will commit to reviewing this program for progress and make additional changes and necessary to streamline the process.
• PROGRAM 4.C: Low Barrier Navigation Centers, is a program that was not completed within the last Planning Period which requires the City to complete the necessary zoning code amendments no later than December 2023; City staff will bring draft ordinances to the Planning Commission no later than May 2023 followed by City Council immediately thereafter.
10 Agenda Item 1.

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• PROGRAM 4.D: Transitional and Supportive Housing, is a program that was not completed within the last Planning Period which requires the City to complete the necessary zoning code amendments no later than December 2023; City staff will bring draft ordinances to the Planning Commission no later than May 2023 followed by City Council immediately thereafter.
• PROGRAM 4.E: Employee/Farmworker Housing, is a program that was not completed within the last Planning Period which requires the City to complete the necessary zoning code amendments no later than December 2023; City staff will bring draft ordinances to the Planning Commission no later than May 2023 followed by City Council immediately thereafter.
• PROGRAM 4.F: Reasonable Accommodations, is a program that was not completed within the last Planning Period which requires the City to complete the necessary zoning code amendments no later than December 2023; City staff will bring draft ordinances to the Planning Commission no later than May 2023 followed by City Council immediately thereafter.

2. Identify actions that will be taken to make sites available during the planning period with appropriate zoning and development standards and with services and facilities to accommodate that portion of the city’s or county’s share of the regional housing need for each income level that could not be accommodated on sites identified in the inventory completed pursuant to paragraph (3) of subdivision (a) without rezoning, and to comply with the requirements of Government Code section 65584.09. Sites shall be identified as needed to facilitate and encourage the development of a variety of types of housing for all income levels, including multifamily rental housing, factory-built housing, mobile homes, housing for agricultural employees, supportive housing, single-room occupancy units, emergency shelters, and transitional housing. (Gov. Code, § 65583(c)(1).) • PROGRAM 1.G: previous sites utilized in 5th cycle housing element must be up zoned for a minimum of 30 dwelling units per acre. This is a clarifying assertion within the draft housing element.
• PROGRAM 3.E: the City’s 6th Cycle Housing Element is already consistent with State law and was amended earlier this year. This requirement was discussed with HCD reviewers on the preliminary call to review the findings letter. No action is required. • NEW PROGRAM: the City must include a New Program which commits the City implementing SB 9 regulations consistent with State law. 11 Agenda Item 1.

November 29, 2022 Page 10

The program shall remove constraints to, and provide reasonable accommodations for housing designed for, intended for occupancy by, or with supportive services for, persons with disabilities. (Gov. Code, § 65583(c)(3).)
• The City must provide additional clarifications with the draft housing element regarding potential governmental and nongovernmental constraints. Should any additional changes be required with the document it shall remove constraints that create any impediments to the creation of housing.

5. Develop a plan that incentivizes and promotes the creation of accessory dwelling units that can be offered at affordable rent. (Gov. Code, § 65583(c)(7).) • Accessory Dwelling Unit ordinance shall comply with State law at all times. The City understands this requirement and will further add a program that clearly demonstrates this requirement as requested within the HCD Findings Letter. o The city must remove any barrier that hinder the development of Accessory Dwelling Units.
• The City must specify the incentives such as expedited permit review or fees that will be included.
12 Agenda Item 1.

STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY GAVIN NEWSOM, Governor

DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

DIVISION OF HOUSING POLICY DEVELOPMENT
2020 W. El Camino Avenue, Suite 500
Sacramento, CA 95833
(916) 263-2911 / FAX (916) 263-7453
www.hcd.ca.gov
November 10, 2022
Nick Zornes, Director
Development Services
City of Los Altos
1 North San Antonio Rd
Los Altos, CA 94022
Dear Nick Zornes:

RE: City of Los Altos’ 6th Cycle (2023-2031) Draft Housing Element Thank you for submitting the City of Los Altos’ (City) draft housing element received for review on August 12, 2022. Pursuant to Government Code section 65585, subdivision (b), the California Department of Housing and Community Development (HCD) is reporting the results of its review. Our review was facilitated by a conversation on October 26, 2022 with yourself, and consultants Jennifer Murillo, Stefano Richichi, David Bergman, and Erik Ramakrishnan. HCD also considered public comments from Anne Paulson pursuant to Government Code section 65585, subdivision (c).

The draft element addresses many statutory requirements; however, revisions will be necessary to comply with State Housing Element Law (Article 10.6 of the Gov. Code).

The enclosed Appendix describes the revisions needed to comply with State Housing Element Law.

For your information, pursuant to Assembly Bill 1398 (Chapter 358, Statutes of 2021), if a local government fails to adopt a compliant housing element within 120 days of the statutory deadline (January 31, 2023), then any rezoning to make prior identified sites available or accommodate the regional housing needs allocation (RHNA), including for lower-income households, shall be completed no later than one year from the statutory deadline. Otherwise, the local government’s housing element will no longer comply with State Housing Element Law, and HCD may revoke its finding of substantial compliance pursuant to Government Code section 65585, subdivision (i). Please be aware, if the City fails to adopt a compliant housing element within one year from the statutory deadline, the element cannot be found in substantial compliance until rezones to accommodate a shortfall of sites pursuant to Government Code section 65583, subdivision (c) (1) (A) and Government Code section 65583.2, subdivision (c) are completed.
13 Agenda Item 1.

Nick Zornes, Director

Page 2 ends

Public participation in the development, adoption and implementation of the housing element is essential to effective housing planning. Throughout the housing element process, the City should continue to engage the community, including organizations that represent lower-income and special needs households, by making information regularly available and considering and incorporating comments where appropriate. Please be aware, any revisions to the element must be posted on the local government’s website and to email a link to all individuals and organizations that have previously requested notices relating to the local government’s housing element at least seven days before submitting to HCD.

Several federal, state, and regional funding programs consider housing element compliance as an eligibility or ranking criteria. For example, the CalTrans Senate Bill (SB) 1 Sustainable Communities grant; the Strategic Growth Council and HCD’s Affordable Housing and Sustainable Communities programs; and HCD’s Permanent Local Housing Allocation consider housing element compliance and/or annual reporting requirements pursuant to Government Code section 65400. With a compliant housing element, the City meets housing element requirements for these and other funding sources.

For your information, some general plan element updates are triggered by housing element adoption. HCD reminds the City to consider timing provisions and welcomes the opportunity to provide assistance. For information, please see the Technical Advisories issued by the Governor’s Office of Planning and Research at:
https://www.opr.ca.gov/planning/general-plan/guidelines.html.

HCD appreciates the cooperation the housing element team provided during the review.

We are committed to assist the City in addressing all statutory requirements of State Housing Element Law. If you have any questions or need additional technical assistance, please contact Anthony Errichetto, of our staff, at [email protected].

Sincerely,
Paul McDougall
Senior Program Manager
Enclosure
14 Agenda Item 1.

Review of the City of Los Altos’ 6th Cycle Draft Housing Element Page 1 November 10, 2022

APPENDIX

CITY OF LOS ALTOS
The following changes are necessary to bring the City’s housing element into compliance with Article 10.6 of the Government Code. Accompanying each recommended change, we cite the supporting section of the Government Code.

Housing element technical assistance information is available on HCD’s website at https://www.hcd.ca.gov/hcd-memos. Among other resources, the housing element section contains HCD’s latest technical assistance tool, Building Blocks for Effective Housing Elements (Building Blocks), available at https://www.hcd.ca.gov/building-blocks and includes the Government Code addressing State Housing Element Law and other resources.

A. Review and Revision
the previous element to evaluate the appropriateness, effectiveness, and Review progress in implementation, and reflect the results of this review in the revised element. (Gov. Code, § 65588 (a) and (b).)
As part of the review of programs in the past cycle, the element must provide an evaluation of the effectiveness of goals, policies, and related actions in meeting the housing needs of special needs populations (e.g., elderly, persons with disabilities, large households, female headed households, farmworkers, and persons experiencing homelessness).

B. Housing Needs, Resources, and Constraints

1. Affirmatively further[ing] fair housing in accordance with Chapter 15 (commencing with Section 8899.50) of Division 1 of Title 2…shall include an assessment of fair housing in the jurisdiction. (Gov. Code, § 65583, subd. (c)(10)(A).) Outreach and Enforcement: The element generally satisfies this requirement; however, annual outreach should be added to the programs section.

Integration and Segregation: To assist in meeting this requirement, the element should provide local data not captured in regional, state, or federal data analysis to help describes what contributes to the higher concentration of nonwhite residents in the southern part of the City. In addition, the element generally describes local patterns and trends related to integration and segregation but must also analyze the City relative to the rest of the region regarding familial status.

Racial/Ethnic Concentrated Areas of Affluence (RCAA): The element briefly mentions HCD’s recent data related to RCAAs within the City, but generally should also evaluate 15 Agenda Item 1.

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the patterns and changes over time at a local (e.g., neighborhood to neighborhood) and regional level (e.g., city to region).

Disparities in Access to Opportunity: The element provides information on the access to opportunity through the TCAC opportunity maps but must also provide a complete local and regional analysis of patterns and trends for all components of the assessment of fair housing. A comprehensive analysis should include the local and regional disparities of the educational, environmental, and economic scores through local, federal, and/or state data. It should also analyze persons with disabilities as well as access to transit.

Please refer to page 35 of the AFFH guidebook (https://www.hcd.ca.gov/communitydevelopment/affh/index.shtml#guidance) for specific factors that should be considered when analyzing access to opportunities as it pertains to educational, employment, environmental, transportation, and any factors that are unique to the City. Specifically, the element should analyze what contributes to the City’s low economic resource score, what contributes to the one area with a higher educational score, include local information to describe what contributes to environmental conditions, and describe the quality of transit access within the City and regionally.

Disproportionate Housing Needs: The element includes some local and county data on cost burdened households (overpayment) and substandard housing. However, the element must relate the concentration of cost burden to other factors and discuss what contributes to the differences within the City and regionally. The element should also discuss whether there are any concentrations of substandard housing within the City and relate those conditions to the region. As well, the discussion regarding displacement should address risk and disproportionate impacts on protected characteristics due to natural disaster.

Identified Sites and Affirmatively Furthering Fair Housing (AFFH): While the element includes some AFFH requirements it generally does not address this requirement. The analysis must identify whether sites improve or exacerbate conditions and whether sites are isolated by income group. A full analysis should address the income categories of identified sites with respect to location, the number of sites and units by all income groups and how that affects the existing patterns for all components of the assessment of fair housing (e.g., segregation and integration, access to opportunity). The element should also discuss whether the distribution of sites improves or exacerbates conditions. If sites exacerbate conditions, the element should identify further program actions that will be taken to promote equitable quality of life throughout the community (e.g., anti-displacement and place-based community revitalization strategies).

2. Include an analysis and documentation of household characteristics, including level of payment compared to ability to pay, housing characteristics, including overcrowding, and housing stock condition. (Gov. Code, § 65583, subd. (a)(2).) Overpayment: While the element identifies the total number of households overpaying for housing, it must quantify and analyze the number of lower-income households 16 Agenda Item 1.

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overpaying for housing by tenure (i.e., renter and owner) and add or modify policies and programs as appropriate.

Housing Costs: While the element includes information on sales prices, rental information from the American Community Survey does not fully reflect market conditions and the element should include additional data sources.

3. An inventory of land suitable and available for residential development, including vacant sites and sites having realistic and demonstrated potential for redevelopment during the planning period to meet the locality’s housing need for a designated income level, and an analysis of the relationship of zoning and public facilities and services to these sites. (Gov. Code, § 65583, subd. (a)(3).)
Progress in Meeting the Regional Housing Needs Allocation (RHNA): The element relies on pipeline projects to meet its RHNA, specifically, the element has identified 587 units that are either pending, approved, or under construction. First, to count these units as progress towards RHNA, the element must demonstrate these units are expected to be constructed during the planning period. To demonstrate the availability of units within the planning period, the element could analyze infrastructure schedules, City’s past completion rates on pipeline projects, outreach with project developers, and should describe any expiration dates on entitlements, anticipated timelines for final approvals, and any remaining steps for projects to receive final entitlements. Additionally, given the element’s reliance on pipeline projects, the element should include programs that commit to facilitating development and monitoring approvals of the projects (e.g., coordination with applicants to approve remaining entitlements, supporting funding applications, expediating approvals, rezoning or identification of additional sites should the applications not be approved).

Realistic Capacity: While the element provides assumptions of buildout for sites included in the inventory, it must also provide support for these assumptions. The element should provide additional examples of typical densities of existing or approved projects at similar income levels. Table B-5 on pages B-8 and B-9 should be related to the sites inventory and include affordability levels for the projects listed. In addition, the element appears to assume residential development on sites with zoning that allow 100 percent nonresidential uses. While the element mentions strong market demand for residential uses within nonresidential zones, it must still account for the likelihood of nonresidential uses. For example, the element could analyze all development activity in these nonresidential zones, how often residential development occurs and adjust residential capacity calculations, policies, and programs accordingly. For additional information, see the Building Blocks at http://www.hcd.ca.gov/communitydevelopment/building-blocks/site-inventory-analysis/analysis-of-sites-andzoning.shtml#zoning.

Suitability of Nonvacant Sites: The element must include an analysis demonstrating the potential for redevelopment of nonvacant sites. To address this requirement, the element generally describes the existing use of nonvacant sites. This alone is not 17 Agenda Item 1.

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adequate to demonstrate the potential for redevelopment in the planning period. The description of existing uses should be sufficiently detailed to facilitate an analysis demonstrating the potential for additional development in the planning period for each specific parcel. In addition, the element must analyze the extent that existing uses may impede additional residential development, including analysis of existing leases or contracts that would perpetuate the existing use or prevent additional residential development and include current information on development trends and market conditions in the City and relate those trends to the sites identified. Finally, the analysis should address public comment related to the identified sites and potential for redevelopment and add or remove sites as appropriate.

In addition, if the housing element relies upon nonvacant sites to accommodate more than 50 percent of the RHNA for lower-income households, the housing element must demonstrate that the existing use is not an impediment to additional residential development in the planning period (Gov. Code, § 65583.2, subd. (g)(2).). This can be demonstrated by providing substantial evidence that the existing use is likely to be discontinued during the planning period. Absent findings (e.g., adoption resolution) based on substantial evidence, the existing uses will be presumed to impede additional residential development and will not be utilized toward demonstrating adequate sites to accommodate the RHNA.

Environmental Constraints: While the element generally describes a few environmental conditions within the City (p. C-38), it must describe how these conditions relate to identified sites including environmental constraints within the City that could impact housing development in the planning period such as seismic activity and wildfire threats.

The element should also discuss any other known conditions that may impede or preclude development on identified sites in the planning period (e.g., parcel shape, easements, contamination). For additional information and sample analysis, see the Building Blocks at http://www.hcd.ca.gov/community-development/building-blocks/siteinventory-analysis/analysis-of-sites-and-zoning.shtml#environmental.

Electronic Sites Inventory: For your information, pursuant to Government Code section 65583.3, the City must submit an electronic sites inventory with its adopted housing element. The City must utilize standards, forms, and definitions adopted by HCD.

Please see HCD’s housing element webpage at https://www.hcd.ca.gov/communitydevelopment/housing-element/index.shtml#element for a copy of the form and instructions. The City can reach out to HCD at [email protected] for technical assistance.

Zoning for a Variety of Housing Types:
• Accessory Dwelling Units (ADUs): The element indicates the City modifies its zoning code to ease barriers to the development of ADU’s. However, after a cursory review of the City’s ordinance, HCD discovered several areas which are not consistent with State ADU Law. HCD will provide a complete listing of ADU noncompliance issues under a separate cover. As a result, the element should 18 Agenda Item 1.

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add a program to update the City’s ADU ordinance in order to comply with state law.
• Emergency Shelters: The element mentions emergency shelters are permitted in the PUD/C zone; however this zone is not listed in Table C-5 or Table C-6. The element should describe the development standards of the PUD/C zone or other zones that allows emergency shelters by-right (without discretionary action) and should provide an analysis of capacity, including potential for reuse and proximity to transportation and services and any conditions inappropriate for human habitability. The element should also clarify shelters are permitted without discretionary action and discuss available acreage in the overlay zone, including typical parcel sizes and the presence of reuse opportunities. In addition, the element should describe how emergency shelter parking requirements comply with AB139/Government Code section 65583, subdivision (a)(4)(A) or include a program to comply with this requirement. Lastly, the element should clarify the exact total capacity for emergency shelters. For additional information and a sample analysis, see the Building Blocks at http://www.hcd.ca.gov/communitydevelopment/housing-element/housing-elementemos/docs/sb2_memo050708.pdf. • Single Room Occupancy (SRO) Units: The element should describe whether the City has any procedures to encourage and facilitate SRO development in the allowable zoning districts.
• Manufactured Housing: Manufactured homes that are built on a permanent foundation must be allowed in the same manner and in the same zones as conventional or stick-built structures. Specifically, manufactured homes on a permanent structure should only be subject to the same development standards that a conventional single-family residential dwelling would be subject to. The element must demonstrate consistency with this requirement or add or modify programs as appropriate.

4. An analysis of potential and actual governmental constraints upon the maintenance, improvement, or development of housing for all income levels, including the types of housing identified in paragraph (1) of subdivision (c), and for persons with disabilities as identified in the analysis pursuant to paragraph (7), including land use controls, building codes and their enforcement, site improvements, fees and other exactions required of developers, and local processing and permit procedures... (Gov. Code, § 65583, subd. (a)(5).)
Land Use Controls: The element must identify and analyze all relevant land use controls impacts as potential constraints on a variety of housing types. For example, the analysis must analyze maximum lot coverage, height limits, setbacks in all zones allowing residential uses, particularly higher density. The analyses should address any impacts on cost, supply, housing choice, affordability, timing, approval certainty and ability to achieve maximum densities and include programs to address identified constraints.

Minimum Unit Sizes: The element mentions minimum unit size requirements that would preclude smaller units (e.g., “affordable by design” apartments), these requirements 19 Agenda Item 1.

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should be described and analyzed as a potential constraint, and programs should be added to address identified constraints.

Parking Requirements: The element provides a brief discussion regarding the City’s high parking requirements and provides Program 3.A (Prepare a Downtown parking plan and update parking requirements); however the program should provide a specific commitment to study and update parking requirements throughout the entire City to remove all potential constraints. In addition, Program 3.A should commit to revising parking standards for commercial and high-density residential zoning districts including, parking requirements that exceed a sliding scale for commercial and high-density residential zoning districts, covered versus underground parking requirements, and guest parking requirements.

Fees and Exactions: The element must describe all required fees for single family and multifamily housing development (i.e., zoning change, general plan change, lot splits, in lieu fees, impact fees, etc.) and analyze their impact as potential constraints on housing supply and affordability. For example, the analysis could identify the total amount of fees and their proportion to the development costs for both single family and multifamily housing. In addition, the City’s fees should be analyzed relative to other jurisdictions in the county, which currently are significantly greater than surrounding jurisdictions, and add a program to address any potential constraints. In addition, the element indicates that fees for multifamily projects are significantly greater than those for single-family projects, an uncommon observation not found in other comparable jurisdictions.

Excessive fees for multifamily projects have significant impacts on housing affordability and production. The element should include an evaluation of these fees and add programs to address the constraint as appropriate.

Zoning and Fees Transparency: The element must clarify compliance with new transparency requirements for posting all zoning, development standards and fees on the City’s website and add a program to address these requirements, if necessary.

Local Processing and Permit Procedures: While the element includes information about processing times in Table C-8, it should clarify the typical average time for single family and multifamily processing times. The element should also describe and evaluate the process for a typical development complying with zoning including approval body, number of public hearings, approval findings and any other relevant factors for impacts on housing cost, timing, feasibility and approval certainty. Lastly, the element should clearly describe whether the Planned Development process, including subsequent use permit, is required or optional to applicants. If required, the element should include specific analysis of the impacts of absence of fixed development standards on housing supply (number of units), cost, timing, feasibility, and approval certainty. 20 Agenda Item 1.

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C. Housing Programs

1. Include a program which sets forth a schedule of actions during the planning period, each with a timeline for implementation, which may recognize that certain programs are ongoing, such that there will be beneficial impacts of the programs within the planning period, that the local government is undertaking or intends to undertake to implement the policies and achieve the goals and objectives of the Housing Element... (Gov. Code, § 65583, subd. (c).)
To have a beneficial impact and achieve the goals and objectives of the housing element, programs must have specific commitments and discrete timing (e.g., at least annually, by a specific date). Programs that should be revised include:
• Program 1.B (Higher Density in CT District): The program should provide commitments to specific actions and the timeline should occur earlier in the planning period for accountability, tracking, and potential modification. • Program 1.C (Housing in OA District): The timeline for the program should occur earlier in the planning period for more significant impact. • Program 1.D (Housing on Church Lands): The timeline for the program should occur earlier in the planning period for more significant impact. • Program 1.E (Update Specific Plan): The program should provide a specific commitment to remove objective design standards (i.e., “landscape and beautification”). As well, the timeline for the program should occur earlier in the planning period for more significant impact.
• Program 1.H (City-Owned Sites): The program should commit to provide specific incentives.
• Program 1.I (Downtown Lot Consolidation Incentive): The program should provide a specific commitment to establishing lot consolidation incentives beyond evaluating.
• Program 2.A (Enhance Inclusionary Housing Requirements): The program should provide a specific commitment to modifying fees to address constraints. • Program 2.C (Affordable Housing Funding): The program should include outreach to developers to promote incentives. Also clarify whether incentives are currently in place, if not then include timelines for their implementation. • Program 3.A (Prepare a Downtown parking plan and update parking requirements): As mentioned earlier, the program should provide a specific commitment to study and update parking requirements throughout the entire City and address all constraints.
• Program 3.B (Building Heights in Mixed-Use Zones): The program should specify how many stories will be allowed. In addition, the program should be revised to address height constraints for the entire City.
• Program 3.H (Design Review Process Update): The specific commitments provided in the program are likely insignificant to reducing the design review constraint (i.e., persistence of the planning commission and city council vote during the event of an appeal which is very likely given the elements admissions 21 Agenda Item 1.

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to “community resistance to housing (page C-38). In addition, the program should also remove other subjective design review bodies such as the third-party independent architect review. Furthermore, the program must commit to further evaluate midcycle progress and commit to making changes if necessary to address the constraint.
• Program 4.C (Low Barrier Navigation Centers): The timeline for the program should occur earlier in the planning period. because it is a carryover program from the previous planning cycle – no later than 1 year. • Program 4.D (Transitional and Supportive Housing): The program must specifically commit to comply with AB 2162. In addition, the timeline for the program should occur earlier in the planning period.
• Program 4.E (Employee/Farmworker Housing): The timeline for the program should occur earlier in the planning period because it is a carryover program from the previous planning cycle – no later than 1 year.
• Program 4.F (Reasonable Accommodations): The timeline for the program should occur earlier in the planning period because it is a carryover program from the previous planning cycle – no later than 1 year.

2. Identify actions that will be taken to make sites available during the planning period with appropriate zoning and development standards and with services and facilities to accommodate that portion of the city’s or county’s share of the regional housing need for each income level that could not be accommodated on sites identified in the inventory completed pursuant to paragraph (3) of subdivision (a) without rezoning, and to comply with the requirements of Government Code section 65584.09. Sites shall be identified as needed to facilitate and encourage the development of a variety of types of housing for all income levels, including multifamily rental housing, factory-built housing, mobilehomes, housing for agricultural employees, supportive housing, single-room occupancy units, emergency shelters, and transitional housing. (Gov. Code, § 65583, subd. (c)(1).)
As noted in Finding B3, the element does not include a complete site analysis; therefore, the adequacy of sites and zoning were not established. Based on the results of a complete sites inventory and analysis, the City may need to add or revise programs to address a shortfall of sites or zoning available to encourage a variety of housing types. In addition, the element should be revised, as follows:
• Prior Identified Sites: Program 1.G (Rezone Sites from Previous Housing Element) should commit to rezone sites at appropriate densities (e.g., allow at least 30 units per acre).
• Density Bonus: The element should include a program to ensure the City will update to meet State Density Bonus Law.
• SB 9: The element should include a program to implement SB9 in compliance with State law.
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3. Address and, where appropriate and legally possible, remove governmental and nongovernmental constraints to the maintenance, improvement, and development of housing, including housing for all income levels and housing for persons with disabilities. The program shall remove constraints to, and provide reasonable accommodations for housing designed for, intended for occupancy by, or with supportive services for, persons with disabilities. (Gov. Code, § 65583, subd. (c)(3).) As noted in Finding B4, the element requires a complete analysis of potential governmental and nongovernmental constraints. Depending upon the results of that analysis, the City may need to revise or add programs and address and remove or mitigate any identified constraints.

4. Promote and affirmatively further fair housing opportunities and promote housing throughout the community or communities for all persons regardless of race, religion, sex, marital status, ancestry, national origin, color, familial status, or disability, and other characteristics... (Gov. Code, § 65583, subd. (c)(5).)
As noted in Finding B1, the element must include a complete analysis of AFFH. The element must be revised to add goals and actions based on the outcomes of a complete analysis. Goals and actions must specifically respond to the analysis and to the identified and prioritized contributing factors to fair housing issues and must be significant and meaningful enough to overcome identified patterns and trends. Actions must have specific commitment, metrics, milestones, and geographic targeting as appropriate and must address housing mobility enhancement (more choices and affordability across geographies), new housing choices and affordability in higher opportunity and income areas (e.g., missing middle housing types), place-based strategies for community preservation and revitalization and displacement protection.

Housing mobility and new opportunities in higher resource areas should not be limited to the RHNA and, instead, target meaningful change in terms of fair housing issues. In addition, the element should be revised as follows:
• Program 2.D (ADU Streamlining): The program should geographically target outreach to single family households.
• Program 4.J (Alternative Transportation Incentive): The program should geographically target actions toward unsafe, lower resource, and underdeveloped infrastructure (i.e., sidewalks, protected bike lanes, etc.). • Program 6.C (Housing in Highest Resource Areas): The program should also disseminate information on the City website.
• Program 6.D (Section 8 Vouchers): The program should implement geographic targeting as well as track and modify actions as necessary to accomplish a desirable metric.
• Program 6.E (Anti-Displacement Outreach): The timeline for the program should occur earlier in the planning period for more significant impact. 23 Agenda Item 1.

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5. Develop a plan that incentivizes and promotes the creation of accessory dwelling units that can be offered at affordable rent.. (Gov. Code, § 65583, subd. (c)(7).) The element should be revised as follows:
• Program 2.D (ADU Streamlining): The program must be modified to include necessary revisions to the City’s ADU ordinance to comply with State law.

The program should also provide specific commitments to remove barriers to the review process and clarify what incentives (i.e., processing and fees) will be implemented as well as how often outreach will occur.

D. Public Participation
Local governments shall make a diligent effort to achieve public participation of all economic segments of the community in the development of the Housing Element, and the element shall describe this effort. (Gov. Code, § 65583, subd. (c)(9).) While the element includes a general summary of the public participation process, the element should also demonstrate diligent efforts were made to involve all economic segments of the community in the development of the housing element, including who attended and what feedback was provided. In addition, the element should describe additional methods for public outreach efforts in the future, particularly to include lowerincome and special needs households. 24 Agenda Item 1.

November 29, 2022
Mayor Enander and Members of the City Council
City of Los Altos
1 N. San Antonio Road
Los Altos, CA 94022
Re: Council Study Session – Sixth Cycle Draft Housing Element, November 29th Dear Mayor Enander and Members of the City Council:

The League is pleased to see that HCD’s comment letter to Los Altos indicates that the City should be able to adopt a compliant Housing Element. We are not very concerned with the site inventory because many sites such as Rancho Shopping Center, sites along San Antonio Road and El Camino Real will automatically be up zoned as a result of AB 2011. Therefore, even if Foothill Crossing, for example, is removed from the list, we believe the sites listed should be sufficient.

In addition, we believe that the City can and should easily comply with the requests from HCD that our SB 9, ADU and other ordinances should be rewritten so as to comply with State law. We believe these updates can be accomplished very quickly.

However, we acknowledge that some other concerns expressed by HCD have merit and want to focus on those issues. We agree with the Staff recommendation that in every instance where HCD wants programs to be completed earlier, the City should commit to earlier timeframes, Programs 1.C, 1.D, amongst others. Committing to an earlier deadline is especially critical with Program 3.A, because until a Downtown parking plan is approved it will be difficult to proceed with Program 1.H, designating a downtown parking lot as an affordable housing site. The RFP for housing on a downtown parking plaza is planned for the end of year 2023, but the downtown parking needs must be addressed before such an RFP is realistic. We also agree with HCD that parking standards throughout the City need to be reviewed and updated.

With respect to Programs 1.B and 3.B, HCD asks that the Housing Element commit to a specific height increase. We suggest 5 stories as the base for the CT district and 3 in the mixed-use zones.

Regarding Program 3.H, we hope the City will adopt a very speedy appeal process so that the design review process is truly expedited. We also suggest that the City set specific timelines for the entitlement process and monitor these timelines on an annual basis to make adjustments as necessary. In addition, we urge Staff to meet annually with developers to solicit input on how the streamlining process is working. We also agree with HCD that the third-party independent architect review be dropped.

Thank you for your consideration,
(Please send any questions about this email to [email protected]) 25 Agenda Item 1.

Karin Bricker, President LWV of Los Altos/Mountain View Area Cc: Gabe Engeland. Nick Zornes Angel Rodriguez
26 Agenda Item 1.

November 29, 2022
Dear Mayor Enander and Councilmembers,
The letter from HCD responding to our city’s draft Housing Element was thorough. It recognized that we are working toward creating an environment that encourages much-needed housing.

Mr. Zornes indicated clearly that steps need to be taken in the next iteration of the Housing Element. We would like to underscore some of his points.

Regarding parking requirements (Program 3.A) -
● We agree that there should be a specific commitment included in Program 3.A to study and update parking requirements throughout the city.
● The deadline for the parking amendments for downtown needs to be moved up to the end of 2024, if not sooner. The RFP for housing on the parking plaza (Program 1.H) has a deadline of fourth quarter 2023, but that RFP cannot be done until the parking is evaluated. We’ve seen how long it takes to permit affordable housing. If the permits for the parking plaza housing are to be issued in the planning period, the downtown parking needs to be addressed quickly.

Regarding zoning (Program 3.B) -
● Five stories should be the height limit through the El Camino Real corridor, for both CT and CN zoned areas.
● Projects with less than five units, not including density bonus units, should be approved administratively. Smaller projects (for example, a project on Lyell) do not need extensive review processes.

Regarding the appeals process for projects (Program 3.H) - ● We support Program 3.H, and want to strictly circumscribe the Council’s power to appeal or deny projects. Our process should be quick: ten days to file the appeal, and then a hearing at the next Council meeting, taking into account our noticing requirements. Both Planning Commission denials and appeals of approvals should have to include the objective standard(s) the project purportedly violates. The Council should not be able to uphold or deny an appeal for reasons other than the subject of the appeal, nor should the Council be allowed to impose conditions unrelated to the subject of the appeal of an approved project. The Council should be able to impose conditions if it reverses a denial, but only the normal conditions always imposed, plus conditions related to the appeal.
27 Agenda Item 1.

Regarding alternative transportation (Program 4.J) -
HCD is asking for specific projects to be included. We suggest ● A protected bike lane on El Camino. The new residents of this area, as well as existing cyclists, need a safe way to travel by bike. This proposal is already in the Complete Streets plan.
● A protected bike lane on San Antonio at downtown, also already included in the Complete Streets plan.
● Better pedestrian crossings at San Antonio & Main Street. The new residents of the former OA area along San Antonio will need to be able to cross San Antonio safely on foot.
● Fixing the circulation at Loyola Corners. Given that the Clock Tower building in Loyola Corners could be redeveloped for housing units, and other housing units could be built at Loyola Corners, the circulation needs to be fixed. As residents have been mentioning for years, the traffic patterns in and around Loyola Corners are counter-intuitive and dangerous for pedestrians and cyclists.
● Working with Caltrans to fix the dangerous El Camino/San Antonio intersection for pedestrians and cyclists.

We strongly support a review of the City’s SB 9 and ADU ordinances for compliance with State law. We also strongly support an analysis of the average time a project takes to review and what results in delays.

We look forward to reading the final and approved Element. Most importantly, we look forward to more housing and more neighbors in our vibrant community.

Respectfully,
The Los Altos Affordable Housing Alliance Steering Committee 28 Agenda Item 1.

Los Altos City CouncilNovember 29, 2022

Los Altos City Council
November 29, 2022