Los Gatos City Council
January 30, 2023

Appendix A. AFFH Report
October 2022 Appendix A A-15
complaint process, appealing a decision, and other frequently asked questions8. Fair housing complaints can also be submitted to HUD for investigation.

Additionally, Santa Clara County has a number of local resource and enforcement organizations:
▪ Project Sentinel: Assists with housing discrimination, mortgage foreclosures, rental issues, and more. ▪ Housing and Economic Rights Advocates (HERA) provides legal and advocacy for vulnerable Californians facing discrimination and economic abuses.
▪ Bay Area Legal Aid engages in broad advocacy focused on helping low-income Bay Area residents lead stable lives, including housing stability.
▪ The Law Foundation of Silicon Valley provides legal advocacy for social change with a focus on finding stable homes for low-income residents.
▪ Senior Adults Legal Assistance is a law office dedicated to supporting elder residents obtain independent living.

From 2013 to 2021, 391 fair housing complaints in Santa Clara County were filed with the U.S. Department of Housing and Urban Development (HUD) or Fair Housing Advocates of Northern California (FHANC). Most of the county’s valid complaints cited disability status as the bias. Of these complaints, 69 percent were considered valid and proceeded to actionable responses. Los Gatos had eight total complaints.

Nationally, the National Fair Housing Alliance (NFHA) reported a “negligible” decrease in the number of complaints filed between 2019 and 2020. The primary bases for complaints nationally of disability (55 percent) were represented in Santa Clara County at a much lower rate (16 percent). Familial status represented eight percent of complaints nationally, similar to the six percent of cases in the county. Figure A-8 and Figure A-9 show the share of population by disability status within Santa Clara County and the distribution by census tract, respectively.

NFHA identifies three significant trends in 2020 that are relevant for this AFFH:
▪ First, fair lending cases referred to the Department of Justice from Federal banking regulators has been declining, indicating that State and local government entities may want to play a larger role in examining fair lending barriers to homeownership.
8 https://www.dfeh.ca.gov/complaintprocess/

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A-16 Appendix A October 2022
Figure A-8 Share of Population by Disability Status, 2019 Source: ABAG Housing Needs Data Workbook

Appendix A. AFFH Report
October 2022 Appendix A A-17
Figure A-9 Percent of Population with a Disability by Census Tract, 2019 Source: California Department of Housing and Community Development AFFH Data Viewer

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A-18 Appendix A October 2022
▪ Second, NFHA identified a significant increase in the number of complaints of harassment - 1,071 complaints in 2020 compared to 761 in 2019.

Appendix A. AFFH Report
October 2022 Appendix A A-19
▪ Finally, NFHA found that 73 percent of all fair housing complaints in 2020 were processed by private fair housing organizations, rather than State, local, and Federal government agencies—reinforcing the need for local, active fair housing organizations and increased funding for such organizations9.

Outreach and capacity. Santa Clara County, including Los Gatos, has a number of organizations dedicated to assisting residents with legal services related to housing discrimination and general housing disputes. These organizations are listed in Figure I-1 of the map and data appendix.

The Town also maintains a resource guide that highlights service providers across multiple categories focused on housing and quality of life for underserved members of the community10. Additionally, the Town provides links and email addresses for citizens to participate in the ongoing Housing Element Update process, including links to the agendas and staff reports for the Housing Element Advisory Board (HEAB) meetings.

Finally, the Town has a strong statement about inclusivity and directly addresses hate speech on its website11.

Compliance with State law. Los Gatos is compliant with the following State laws that promote fair and affordable housing. The Town has not been alleged or found in violation of the following:
▪ Housing Accountability Act (Gov. Code. Section 65589.5) requiring adoption of a Housing Element and compliance with RHNA allocations;
▪ No Net Loss Law (Gov. Code Section 65863) requiring that adequate sites be maintained to accommodate unmet RHNA allocations;
▪ Least Cost Zoning Law (Gov. Code. Section 65913.1);
▪ Excessive Subdivision Standards Law (Gov. Code. Section 65913.2); ▪ Limits on Growth Controls Law (Gov. Code. Section 65589.5).

Housing specific policies enacted locally.
▪ Los Gatos offers a density bonus program to comply with State law. ▪ It also has an affordable housing overlay zone; however, that zone applies to one property only. ▪ The Town allows relative diverse type of housing in residential zones. However, minimum lot area for duplexes is quite generous (8,000 square feet). The Town could add flexibility for affordable duplexes— particularly in areas near and within downtown.
▪ The Town requires that development of Accessory Dwelling Units under Town incentive programs be affordable, and deed restricted to 80 percent AMI households. ▪ The Town’s Below Market Price program requirements apply to developments of five units and more and require between 10 percent and 20 percent of units to be affordable to low- and moderate-income households. In-lieu fees are only allowed in limited circumstances, which prioritizes unit development. 9 https://nationalfairhousing.org/2021/07/29/annual-fair-housing-report-shows-increase-in-housing-harassment/ 10 Los-Gatos-Housing-Resources-Guide (losgatosca.gov)
11 https://www.losgatosca.gov/2604/Becoming-an-Inclusive-Community

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A-20 Appendix A October 2022
Publicly-Assisted Housing. According to the California Department of Housing and Community Development AFFH Data Viewer (HCD data viewer), Los Gatos does not have any public housing buildings. Additionally, only a small portion of Los Gatos contains any Housing Choice Voucher usage, a minimal zero to five percent.

A.7 Integration and Segregation
This section discusses integration and segregation of the population by protected classes including race and ethnicity, disability status, familial status, and income status. The section concludes with an analysis of racially and ethnically concentrated areas of poverty and affluence.

Integration and Segregation
“Integration generally means a condition in which there is not a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a particular type of disability when compared to a broader geographic area.

Segregation generally means a condition in which there is a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a type of disability in a particular geographic area when compared to a broader geographic area.” Race and ethnicity. Los Gatos differs from the county and Bay Area overall for its relatively high proportion of residents identifying as non-Hispanic White (72 percent in Los Gatos compared to 32 percent in Santa Clara County) and small Hispanic population (eight percent in Los Gatos and 25 percent in the county). ▪ Los Gatos’ proportion of Black/African American and Other and mixed-race residents is less proportional to the County and the Bay Area overall (Figure A-10).
▪ Los Gatos’ residents have grown more racially diverse since 2000 largely due to growth in Asian and Hispanic residents (Figure B-4).
▪ Older residents are less racially diverse than other age groups, with 87 percent of the population older than 65 years identifying as White compared to 77 percent of those aged 18 to 24 and 75 percent of children less than 18 years old. The main shift is the inclusion of more diverse populations in younger age groups, especially among Asian/API and Other/Multiple race residents (Figure B-3). ▪ Poverty rates are very low for all residents including residents of color. Black/African American have the lowest poverty rate at less than 1 percent. The highest poverty rate was 6.1 percent among Hispanic residents (Figure B-13).

Appendix A. AFFH Report
October 2022 Appendix A A-21
Figure A-10 Population by Race
Source: ABAG Housing Needs Data Workbook
15%
37%
27%
6%
72% 32% 39%
4%
4% 5%
8%
25% 24%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%
100.0%
Los Gatos Santa Clara County Bay Area
Percent of Population
Hispanic or Latinx
Other Race or Multiple Races, Non-Hispanic
White, Non-Hispanic
Black or African American, Non-Hispanic
Asian / API, Non-Hispanic
American Indian or Alaska Native, Non-Hispanic

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A-22 Appendix A October 2022
Geospatially, almost all census tracts in Los Gatos have a predominantly White population (Figure A-2 above).

Compared with neighboring Monte Sereno, Los Gatos has a more varied neighborhood composition map and a more even dispersion of residents of varied races and ethnicities, see Figure A-5 above. Overall, the Town has low to moderate diversity (Figure A-6 and Figure A-7 above). The Town’s diversity index has improved since 2010 due to changes in racial and ethnic diversity in the northern and eastern portions of Town.

The Association of Bay Area Governments (ABAG), working with UC Merced, created a 2021 report on segregation in Los Gatos that measured racial and income segregation within the community. This report, in its entirety can be found in Appendix G. That report utilized several common measures of segregation:
▪ The Dissimilarity Index, or DI, is a common tool that measures segregation in a community. DI is an index that measures the degree to which two distinct groups are evenly distributed across a geographic area. DI represents the percentage of a group’s population that would have to move for each area in the county to have the same percentage of that group as the county overall. DI values range from zero to 100—where zero is perfect integration and 100 is complete segregation. Dissimilarity index values between zero and 39 generally indicate low segregation, values between 40 and 54 generally indicate moderate segregation, and values between 55 and 100 generally indicate a high level of segregation. ▪ The isolation index is interpreted as the probability that a randomly drawn minority resident shares an area with a member of the same minority, it ranges from zero to 100 and higher values of isolation tend to indicate higher levels of segregation.

ABAG’s assessed measures of segregation above highlighted White residents as the most segregated in Los Gatos. White residents are more likely than any other racial group to live in a neighborhood where they are unlikely to come into contact with other racial groups. However, White residents are becoming less isolated over time—and segregation in Los Gatos is decreasing.

Segregation by income increased between 2010 and 2015. In 2015, the income segregation in Los Gatos between lower-income residents and other residents was higher than the average value for Bay Area jurisdictions.

Disability status. The share of the population living with at least one disability is nine percent in Los Gatos compared to eight percent in Santa Clara County. Roughly a third of census tracts in Los Gatos contain 10 percent to 20 percent of persons with a disability, higher than most of the surrounding jurisdictions (Figure A-9 above).

Familial status. Familial status can indicate specific housing needs and preferences. A larger number of nonfamily or single person households indicates a higher share of seniors living alone, young adults living alone or with roommates, and unmarried partners. Higher shares of nonfamily households indicate an increased need for one- and two-bedroom units.

Los Gatos’ households are as likely to be three to four person households (34 percent) as two person households (35 percent). Compared to the county and Bay Area overall, Los Gatos mirrors the share of one person households (26 percent compared to 20 percent in the county and 25 percent for the Bay Area). Married couple households were the majority household type (58 percent) and 31 percent of all households have at least one child under the age of 18. The share of single persons and female-headed households mirror the makeup in the Bay Area.

The Town has no concentrations of adults living alone, suggesting that access to in-home services and care for single, older adults is less critical for Los Gatos than some surrounding communities within the county. However, the Town’s age distribution has shifted upwards since 2000 (Figure B-2) and these accommodations may grow in demand if older adults, 55 and older, in Los Gatos age in place.

Appendix A. AFFH Report
October 2022 Appendix A A-23
Los Gatos’ married couples overwhelmingly own housing: seventy-seven percent of married couple families in the Town own their homes.

Renters are more likely to occupy studios and one- and two-bedroom units than owners (Figure B-36), and owners are more likely to be occupying three to four- and 5 or more-bedroom units. Owners and renters are equally as likely to live alone.

Household income. Los Gatos’ households are higher-income than the county and Bay Area overall: 65 percent of Los Gatos households earn more than 100 percent of the AMI, compared to 55 percent for the county and 52 percent for the Bay Area (Figure B-11, and infographic below).

Every block group in Los Gatos with available data has a median household income of $125,000 or more. In the Town, Hispanic or Latinx and Other Race or Multiple Races (Hispanic and Non-Hispanic) residents experience the highest rates of poverty, followed by White (Hispanic and Non-Hispanic) residents (Figure B-13).

Racially or ethnically concentrated areas of poverty and affluence. Racially Concentrated Area of Poverty or an Ethnically Concentrated Area of Poverty (R/ECAP) and Racially Concentrated Areas of Affluence (RCAAs) represent opposing ends of the segregation spectrum from racially or ethnically segregated areas with high Segregation and Integration Population by Protected Class
City of Los Gatos Santa Clara County
Race and Ethnicity
American Indian or Alaska Native, NH 0% 0%
Asian / API, NH 15% 37%
Black or African American, NH 1% 2%
White, Non-Hispanic (NH) 72% 32%
Other Race or Multiple Races, NH 4% 4%
Hispanic or Latinx 8% 25%
Disability Status
With a disability 9% 8%
Without a disability 91% 92%
Familial Status
Female-Headed Family Households 8% 10%
Male-headed Family Households 3% 5%
Married-couple Family Households 58% 57%
Other Non-Family Households 5% 8%
Single-person Households 26% 20%
Household Income
0%-30% of AMI 9% 14%
31%-50% of AMI 8% 11%
51%-80% of AMI 9% 11%
81%-100% of AMI 9% 9%
Greater than 100% of AMI 65% 55%
0%
15%
1%
72%
4%
8%
0%
37%
2%
32%
4%
25%
9%
91%
8%
92%
8%
3%
58%
5%
26%
10%
5%
57%
8%
20%
9%
8%
9%
9%
65%
14%
11%
11%
9%
55%
Town

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A-24 Appendix A October 2022
poverty rates to affluent predominantly White neighborhoods. Historically, HUD has paid particular attention to R/ECAPs as a focus of policy and obligations to AFFH. Recent research out of the University of Minnesota Humphrey School of Public Affairs argues for the inclusion of RCAAs to acknowledge current and past policies that created and perpetuate these areas of high opportunity and exclusion12.

It is important to note that R/ECAPs and RCAAs are not areas of focus because of racial and ethnic concentrations alone. This study recognizes that racial and ethnic clusters can be a part of fair housing choice if they occur in a non-discriminatory market. Rather, R/ECAPs are meant to identify areas where residents may have historically faced discrimination and continue to be challenged by limited economic opportunity, and conversely, RCAAs are meant to identify areas of particular advantage and exclusion.

R/ECAPs
HCD and HUD’s definition of a Racially/Ethnically Concentrated Area of Poverty is:
▪ A census tract that has a non-White population of 50 percent or more (majority-minority) or, for non-urban areas, 20 percent, AND a poverty rate of 40 percent or more; OR ▪ A census tract that has a non-white population of 50 percent or more (majority-minority) AND the poverty rate is three times the average tract poverty rate for the County, whichever is lower.

Source: California Department of Housing and Community Development Guidance, 2021.

For this study, the poverty threshold used to qualify a tract as an R/ECAP was three times the average census tract poverty rate countywide, or 22.5 percent.

There are no census tracts in Los Gatos that qualify as R/ECAPs. R/ECAPs in the county are all located in San Jose.

RCAAs. At the time this report was written, HCD and HUD had not established standard definitions for Racially or Ethnically Concentrated Areas of Affluence (RCAAs). However, these are generally understood to be neighborhoods in which there are both high concentrations of non-Hispanic White households and high household income rates. Comparing Los Gatos to the surrounding county and region, it is safe to speculate that the Town has more RCAAs as other communities, the county, and the region.

A.8 Access to Opportunity
This section discusses disparities in access to opportunity among protected classes including access to quality education, employment, and environment.

Access to Opportunity
“Access to opportunity is a concept to approximate place-based characteristics linked to critical life outcomes. Access to opportunity oftentimes means both improving the quality of life for residents of low-income communities, as well as supporting mobility and access to ‘high resource’ 12 Goetz, E. G., Damiano, A., & Williams, R. A. (2019). Racially Concentrated Areas of Affluence: A Preliminary Investigation. Cityscape: A Journal of Policy Development and Research, 21(1), 99–124

Appendix A. AFFH Report
October 2022 Appendix A A-25
neighborhoods. This encompasses education, employment, economic development, safe and decent housing, low rates of violent crime, transportation, and other opportunities, including recreation, food and healthy environment (air, water, safe neighborhood, safety from environmental hazards, social services, and cultural institutions).” Source: California Department of Housing and Community Development Guidance, 2021, page 34.

The California Tax Credit Allocation Committee (TCAC) in collaboration with HCD developed a series of opportunity maps that help to identify areas of the community with good or poor access to opportunity for residents. These maps were developed to align funding allocations with the goal of improving outcomes for lowincome residents—particularly children.

The opportunity maps highlight areas of highest resource, high resource, moderate resource, moderate resource (rapidly changing), low resource and high segregation and poverty. TCAC provides opportunity maps for access to opportunity in quality education, employment, transportation, and environment. Opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes.

TCAC’s economic opportunity score comprises poverty, adult educational attainment, employment, job proximity, and median home value for Los Gatos and is shown in Figure A-11.

Figure A-11 Population Living in High Resource Areas by Race Source: ABAG Housing Needs Data Workbook, California Tax Credit Allocation Committee (TCAC)/California Housing and Community Development (HCD), Opportunity Maps (2020); U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B03002 16%
70%
9%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Low Resource or High
Segregation and Poverty
Area
Moderate Resource Area High/Highest Resource
Area
Percent of Population
Hispanic or Latinx
Other Race or Multiple Races, Non-Hispanic
White, Non-Hispanic
Black or African American, Non-Hispanic
Asian / API, Non-Hispanic
American Indian or Alaska Native, Non-Hispanic

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A-26 Appendix A October 2022
Education. TCAC’s education score is based on math proficiency, reading proficiency, high school graduation rates, and the student poverty rate. According to TCAC’s educational opportunity map, every census tract in Los Gatos scores higher than 0.75—indicating the highest positive educational outcomes. Opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes.

Los Gatos is served by the Los Gatos-Saratoga Union High School District, the Los Gatos Union Elementary School, the Saratoga Elementary School Districts, Loma Prieta Joint Union Elementary, and Lakeside Joint School District. The most complete data, due to halted data collection during the COVID pandemic, was from 2019 and highlights a 97.7 percent graduation rate among all students in the Los Gatos-Saratoga Union high school, a small increase over 2018 (97.1 percent). When broken down by race/ethnicity, Asian students graduated at a slightly higher rate of 98 percent, while Hispanic and White students graduated at 95 percent and

96.5 percent respectively. There were not enough African American students enrolled to provide accurate data (less than 11 total). The lowest graduation rate was among students with a disability, yet still relatively high at 88 percent.

The Los Gatos Union Elementary served 2,710 students in 2021, down from 3,024 from 2019, the last year with complete data. White students accounted for 64 percent of the student body, with Asian (19 percent) and Hispanic students (9 percent) accounting for the majority of the remainder. The school included four percent socioeconomically disadvantaged students, one homeless student, and seven percent students with a disability.

Saratoga Elementary had 1,657 students in 2021 and 1,765 in 2019. At Saratoga, 57 percent of students are Asian and White students accounted for 26 percent and Hispanic students another six percent. Saratoga Elementary served a student population with 11 percent disabilities, two percent socioeconomically disadvantaged, and no homeless students.

Employment. The job to household ratio for Los Gatos tracks with the Bay Area and is lower than Santa Clara County’s (Figure B-8), indicating that Los Gatos is less of a commuter city than surrounding jurisdictions with much higher job to household ratios. This differs, however, by wage (Figure B-7), with jobs to household ratios much higher for low wage workers who cannot afford to live in the Town. Los Gatos has twice as many jobs as workers for low wage jobs.
▪ Notably, Los Gatos had 19,843 jobs (Figure B-5) in 2018 compared to 14,573 job holders (Figure III-3), indicating a healthy job market for local residents and a need for in-commuting to fill the unoccupied jobs. ▪ Most jobs in Los Gatos are in Financial and Professional Services and Health and Educational Services (Figure B-9).
▪ Unemployment in Los Gatos is five percent, below the county and area averages (Figure B-10).

HUD’s job proximity index shows that Los Gatos offers a moderate to high proximity to jobs. On a scale from zero to 100, where 100 is the closest proximity to jobs, the areas near Highway 17 score within the high proximity range, while most of the remaining parts of the Town scores as moderate proximity. The further away from Highway 17, the lower the proximity to jobs.

Environment. TCAC’s opportunity areas environmental scores are based on the CalEnviroScreen four indicators, which identify areas disproportionately vulnerable to pollution sources such as ozone, PM2.5, diesel PM, pesticides, toxic release, traffic, cleanup sites, groundwater threats, hazardous waste, impaired water bodies, and solid waste sites.

Three-quarters of Los Gatos scores low on positive environmental outcomes, with no census tracts in the Town scoring over 0.5 out of one (Figure A-12). Los Gatos almost uniformly had the lowest possible scores according to the CalEnviroScreen metric for 2021.

Appendix A. AFFH Report
October 2022 Appendix A A-27
Figure A-12 CalEnviroScreen 4.0, Los Gatos
Source: California Office and Environmental Health Hazard Assessment, CalEnviroScreen Maps and Data.

The Town scores high on California Healthy Places Index (HPI) developed by the Public Health Alliance of Southern California (PHASC) (Figure A-13). HPI includes 25 community characteristics in eight categories including economic, social, education, transportation, neighborhood, housing, clean environment, and healthcare13.
13 https://healthyplacesindex.org/about/

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A-28 Appendix A October 2022
Figure A-13 California Healthy Places Index, Los Gatos
Source: Public Health Alliance of Southern California, California Healthy Places Index.

Disparities in access to opportunity. All residents live in highly resourced areas, regardless of race or ethnicity (Figure A-11). Los Gatos and other surrounding areas are entirely high opportunity jurisdictions.

The Social Vulnerability Index (SVI) provided by the Center for Disease Control (CDC)—ranks census tracts based on their ability to respond to a disaster—includes four themes of socioeconomic status, household composition, race or ethnicity, and housing and transportation. Los Gatos scores well on the SVI; with no neighborhoods ill equipped to respond to disasters.

Los Gatos does not have any disadvantaged communities as defined under SB 535 as, “the top 25 percent scoring areas from CalEnviroScreen along with other areas with high amounts of pollution and low populations”14.

Disparities specific to the population living with a disability. Nine percent of the population in Los Gatos is living with at least one disability, compared to eight percent in the county. The most common disabilities in Los Gatos are ambulatory (4.8 percent), independent living difficulty (4.3 percent), and hearing difficulty (3.6 percent). For the population 65 and over, the share of the population with ambulatory difficulties increases to 18.4 percent, independent living difficulty increase to 15.2 percent, and hearing difficulty was 13.8 percent. 15 percent of residents with a disability were unemployed in 2019, while only four percent unemployment for residents without a disability.
14 https://oehha.ca.gov/calenviroscreen/sb535

Appendix A. AFFH Report
October 2022 Appendix A A-29
Disability
“Disability types include hearing difficulty, vision difficulty, cognitive difficulty, ambulatory difficulty, self-care difficulty, and independent living difficulty.” Source: California Department of Housing and Community Development Guidance, 2021, page 36.

Access to Opportunity
Regional Access
City of Los Gatos Santa Clara County
Jobs to Household Ratio 1.59 1.71
Unemployment Rate 5% 6%
LEP Population 2% 9%
Share of Population by Race in Resource Areas in the City of Los Gatos Employment by Disability Status
For those in the labor
0%
16% 1% 70% 4% 9%
Moderate Resource Area
High/Highest Resource Area
American Indian or Alaska Native, NH Asian / API, NH
Black or African American, NH White, Non-Hispanic (NH)
Other Race or Multiple Races, NH Hispanic or Latinx
96%
85%
4%
15%
No Disability
With A Disability
City of Los Gatos
96%
90%
4%
10%
No Disability
With A Disability
Employed Unemployed
Santa Clara County
Town
Town of Los Gatos
Town

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A.9 Disproportionate Housing Needs
This section discusses disparate housing needs for protected classes including cost burden and severe cost burden, overcrowding, substandard housing conditions, homelessness, displacement, and other considerations.

Disproportionate Housing Needs
“Disproportionate housing needs generally refers to a condition in which there are significant disparities in the proportion of members of a protected class experiencing a category of housing need when compared to the proportion of members of any other relevant groups, or the total population experiencing that category of housing need in the applicable geographic area. For purposes of this definition, categories of housing need are based on such factors as cost burden and severe cost burden, overcrowding, homelessness, and substandard housing conditions.” Source: California Department of Housing and Community Development Guidance, 2021, page 39.

Housing Needs. Since 2015, the housing that has received permits to accommodate growth has almost exclusively been priced for the higher incomes, with only two units permitted for low-income households and none for very low-income households.
▪ The vast majority of the Town’s homes were built between 1940 and 1979 (69 percent). After this period, housing production slowed, with only three percent of units built since 2010. ▪ Los Gatos housing is becoming more limited by type with 76 percent single-family units, up from 71 percent in 2010. Multifamily housing, with five or more units, made up the second highest category of units (18 percent); there were sixty-four mobile/manufactured homes in Los Gatos15. ▪ Eighty-four percent of owner-occupied homes in Los Gatos are valued over one million dollars with another 39 percent valued above two million dollars. This compares to 48 percent for the county and 35 percent for the Bay Area overall (Figure B-23). According to the Zillow Home Value Index, home values in Los Gatos are 63 percent higher than home values for the county and almost double the cost of housing in the Bay Area (Figure B-24).
▪ Rents in Los Gatos are most likely to be at least $2,000 per month (63 percent); 24 percent rent for $3,000 per month. While the Town’s rental costs higher than in the county, the trend of increasing rental costs matches the changes in the county and Bay Area overall.

Cost burden and severe cost burden. Despite Los Gatos’ comparably high housing costs, cost burden—which occurs when households spend more than 30 percent of their gross income on housing costs—is slightly better than the county and Bay Area (Figure A-15). This is indicative of a market with high barriers to entry. The lack of publicly subsidized housing and opportunity for use of Housing Choice Vouchers limits the ability of low-income households (who are typically cost burdened) to live in the Town.

Cost burden does vary by tenure (renter or ownership) in Los Gatos, Figure A-16. Renters experience a greater share of all forms of cost burden while owners experienced less of a cost burden. The cost burden by income decreases for each increase in earned income (AMI category) with a vast difference between the highest and lowest income groups. Seventy-eight percent of the lowest income group (zero percent to 30 percent of AMI) pay 15 Housing Needs Data Report: Los Gatos, ABAG/MTC Staff and Baird + Driskell Community Planning, 2021.

Appendix A. AFFH Report
October 2022 Appendix A A-31
more than 50 percent of their gross household incomes in housing costs (Figure A-16). Figure A-14 identifies the housing vouchers distribution by tract within Los Gatos.

Figure A-14 Housing Choice Vouchers by Census Tract
Source: California Department of Housing and Community Development AFFH Data Viewer

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Figure A-15 through Figure A-19 shows cost burden distribution by jurisdiction, tenure, Area Median Income (AMI), race and ethnicity, and the size of the families. Renters experience a greater share of all forms of cost burden (42 percent) while owners experienced 28 percent cost burden (Figure A-16). The cost burden by income decreases for each increase in earned income (AMI category) with a vast difference between the highest and lowest income groups (16 percent versus 90 percent). Seventy-eight percent of the lowest income group pay more than 50 percent of their gross household incomes in housing costs.

There is consistency in housing cost burden in Los Gatos by race and ethnicity. All households have similar shares of residents paying less than 30 percent of their income on housing. Hispanic and Black/African American residents were the only groups to experience a greater percentage of households spending 50 percent or more of their income than 30 percent to 50 percent of their income, indicating larger shares of extreme cost burdens, see Figure A-18.

Figure A-15 Overpayment (Cost Burden) by Jurisdiction, 2019 Source: ABAG Housing Needs Data Workbook
Figure A-16 Overpayment (Cost Burden) by Tenure, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook

Appendix A. AFFH Report
October 2022 Appendix A A-33
Figure A-17 Overpayment (Cost Burden) by AMI, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook
Figure A-18 Overpayment (Cost Burden) by Race and Ethnicity, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook

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Figure A-19 Overpayment (Cost Burden) by Family Size, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook

Appendix A. AFFH Report
October 2022 Appendix A A-35
Figure A-20 Overpayment (Cost Burden) for Renter Households by Census Tract, 2019 Source: California Department of Housing and Community Development AFFH Data Viewer

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Figure A-21 Overpayment (Cost Burden) for Owner Households by Census Tract, 2019 Source: California Department of Housing and Community Development AFFH Data Viewer

Appendix A. AFFH Report
October 2022 Appendix A A-37
Overcrowding. The vast majority of households (97 percent) in Los Gatos are not overcrowded—indicated by more than one occupant per room (Figure A-22). Renter households are more likely to be overcrowded, with six percent of renter households with more than one occupant per room, compared to 0.3 percent of owner households (Figure B-32).

Figure A-22 Overpayment (Cost Burden) for Owner Households by Census Tract, 2019 Source: ABAG Housing Needs Data Workbook, U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2013-2017 release
Hispanic residents experience the highest rates of overcrowding (Figure B-34). The rest of the Town’s population experiences approximately two percent to 3.5 percent overcrowding. 97% 92% 93%
5% 4%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%
100.0%
Los Gatos Santa Clara County Bay Area
Percent of Households

1.00 occupants per room or less 1.01 to 1.50 occupants per room

1.50 occupants per room or more

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A-38 Appendix A October 2022
Figure A-23 Occupants per Room by Jurisdiction, 2019
Source: ABAG Housing Needs Data Workbook
Figure A-24 Occupants per Room by Tenure, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook
Figure A-25 Overcrowding by Race and Ethnicity, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook

Appendix A. AFFH Report
October 2022 Appendix A A-39
Figure A-26 Occupants per Room by AMI, Los Gatos, 2019
Source: ABAG Housing Needs Data Workbook

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A-40 Appendix A October 2022
Figure A-27 Overcrowded Households by Census Tract, 2019 Source: California Department of Housing and Community Development AFFH Data Viewer

Appendix A. AFFH Report
October 2022 Appendix A A-41
Substandard housing. Data on housing condition are limited, with the most consistent data available across jurisdictions found in the American Community Survey (ACS)—which captures units in substandard condition as self-reported in Census surveys. Renters in Los Gatos report living in substandard housing in 5.5 percent of housing units, with the more units lacking complete kitchen facilities (4.1 percent). As shown in Figure A-28, about 0.4 percent of owner households are lacking complete kitchens and 0.6 percent lack complete plumbing.

Figure A-28 Percent of Units Lacking Complete Kitchen and Plumbing Facilities, Los Gatos, 2019 Source: ABAG Housing Needs Data Workbook
Homelessness. In 2019, 9,706 people were experiencing homelessness in the county during the one-day count (point-in-time), with only 18 percent of people in emergency or transitional shelter while the remaining 82 percent were unsheltered. The majority of unsheltered people experiencing homelessness were in households without children. The majority of people in transitional housing were in households with children or people without children, as shown in Figure A-29.

People who identify as American Indian or Alaskan Native (approximately eight percent of the homeless population compared to less than one percent of the total population), Black (approximately 19 percent, compared to two and a half percent of the total population), , and Other Race or Multiple Races (approximately 24 percent compared to 16 percent of the total population) are overrepresented in the homeless population compared to their share of the general population, as shown in Figure A-30. People struggling with chronic substance abuse (35 percent), severe mental illness (42 percent), and post-traumatic stress disorder (33 percent) represented a substantial share of the homeless population in 2019. Losing a job or being evicted was reported to be the causal events that led to homelessness in 44 percent of incidents of homelessness16. 16 According to Santa Clara County’s Homeless Census & Survey (2019); 2019 SCC Homeless Census and Survey Exec Summary.pdf (sccgov.org).

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A-42 Appendix A October 2022
Figure A-29 Homelessness by Household Type and Shelter Status, Santa Clara County, 2019 Source: ABAG Housing Needs Data Workbook
Figure A-30 Share of General and Homeless Populations by Race, Santa Clara County, 2019 Source: ABAG Housing Needs Data Workbook
Sheltered - Emergency Shelter 7 377 696
Sheltered - Transitional Housing 3 301 400
Unsheltered 266 243 7,413
People in
Households
Solely Children
People in
Households
with Adults
and Children
People in
Households
Without
Children Page 765
Appendix A. AFFH Report
October 2022 Appendix A A-43
Displacement. According to the Sensitive Communities map of vulnerable communities, one area north of Highway 9 and west of Highway 17 were vulnerable to displacement. The Town has 169 assisted units, but all were rated as low risk of conversion. Figure A-31 illustrates the social vulnerability index, identifying the census tracts by lower or higher social vulnerability.

Figure A-31 Social Vulnerability Index by Census Tract, 2018 Source: California Department of Housing and Community Development AFFH Data Viewer

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A-44 Appendix A October 2022
Displacement Sensitive Communities
“According to the Urban Displacement Project, communities were designated sensitive if they met the following criteria:
▪ They currently have populations vulnerable to displacement in the event of increased redevelopment and drastic shifts in housing cost. Vulnerability is defined as:
▪ Share of very low-income residents is above 20 percent, 2017 AND the tract meets two of the following criteria:
▪ Share of renters is above 40 percent, 2017
▪ Share of people of color is above 50 percent, 2017
▪ Share of very low-income households (50 percent AMI or below) that are severely rent burdened households is above the county median, 2017
▪ They or areas in close proximity have been experiencing displacement pressures.

Displacement pressure is defined as:
▪ Percent change in rent above county median for rent increases, 2012-2017 OR
▪ Difference between tract median rent and median rent for surrounding tracts above median for all tracts in county (rent gap), 2017”
Source: https://www.sensitivecommunities.org/.

Access to mortgage loans. In many communities, disparities by race and ethnicity are prevalent for home mortgage applications, particularly in denial rates. This is less true in Los Gatos (Figure A-32). Mortgage denial rates range from 17 percent to 25 percent. American Indian or Alaska Native, Non-Hispanic and Black/African American residents experienced the next highest rejection rate at 25 percent and 22 percent.

Appendix A. AFFH Report
October 2022 Appendix A A-45
Figure A-32 Mortgage Applications and Acceptance by Race, 2018 and 2019 Source: ABAG Housing Needs Data Workbook, Federal Financial Institutions Examination Council's (FFIEC) Home Mortgage Disclosure Act loan/application register (LAR) files.
11%
25% 15%
22%
17% 18% 17%
25%
13%
11%
12% 14% 11%
25%
5%
5%
25%
66%
56%
65% 59% 64%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
American
Indian or
Alaska
Native, NonHispanic
Asian / API,
Non-Hispanic
Black or
African
American,
Non-Hispanic
White, NonHispanicHispanic or
Latinx
Unknown
Loan Applications
Loan originated
File closed for incompleteness
Application withdrawn by applicant
Application denied
Application approved but not accepted

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Disproportionate Housing Needs
Cost Burden, City of Los Gatos, 2019
Area Median Income (AMI)
Overcrowding, City of Los Gatos, 2019
Occupants per Room by Tenure
Substandard Housing, City of Los Gatos, 2019
Incomplete Kitchen and Plumbing Facilities by Tenure
Homelessness, Santa Clara County, 2019
Race and Ethnicity
Share of Homeless
Population
Share of Overall
Population
American Indian or Alaska Native 8% 1%
Asian / API 5% 37%
Black or African American 19% 2%
White 44% 44%
Other Race or Multiple Races 24% 16%
Displacement, 2020
Assisted Units at High or Very
High Risk of Displacement City of Los Gatos Santa Clara County Number of Units 0 0
% of Assisted Units 0% 0%
10%
28%
39%
49%
84%
12%
22%
38%
33%
12%
78%
49%
22%
4%
0%-30% of AMI
31%-50% of AMI
51%-80% of AMI
81%-100% of AMI
100%+ of AMI
0%-30% of Income Used for Housing 30%-50% of Income Used for Housing 50%+ of Income Used for Housing

0.4%

0.6%

4.1%

1.4%
Kitchen
Plumbing
Owner Renter

2.1%

4.3%

0.3%

0.3%

1.0 to 1.5 Occupants per Room
More than 1.5 Occupants per Room
Owner Renter Series3

1.5+ Occupants
per Room
1-1.5 Occupants
per Room
Town
Town
Town

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Housing Needs Assessment

APPENDIX
B

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-1
B.1 Introduction
This appendix of the Housing Element describes existing housing needs and conditions in the Town of Los Gatos.

The analysis in this section primarily utilizes data compiled by Association of Bay Area Governments/ Metropolitan Transportation Commission (ABAG/MTC) in the “Housing Needs Data Report: Los Gatos” (ABAG/MTC, Baird + Driskell Community Planning, April 2, 2021). This data packet was approved by the California Department of Housing and Community Development (HCD).

Overview of Bay Area Housing
The Bay Area continues to see growth in both population and jobs, which means more housing of various types and sizes is needed to ensure that residents across all income levels, ages, and abilities have a place to call home. While the number of people drawn to the region over the past 30 years has steadily increased, housing production has stalled, contributing to the housing shortage that communities are experiencing today. In many communities, this has resulted in residents being priced out, increased traffic congestion caused by longer commutes, and fewer people across incomes being able to purchase homes or meet surging rents.

The 2023-2031 Housing Element Update provides a roadmap for how to meet growth and housing challenges.

As required by the State, the Housing Element identifies what the existing housing conditions and community needs are, reiterates goals, and creates a plan for more housing.

Summary of Key Facts
▪ Population – Generally, the population of the Bay Area continues to grow because of new births (natural growth) and the strong economy draws new residents to the region. The population of the Town of Los Gatos increased by 10 percent from 2000 to 2020, which is below the growth rate of the Bay Area. ▪ Age – In 2019, the youth population of the Town, under the age of 18, was 6,767 and the senior population, 65 and older, was 6,393. These age groups represent 22. percent and 20.8 percent, respectively, of the Town’s population.
▪ Race/Ethnicity – In 2020, 72.3 percent of the Town of Los Gatos population was White, while 0.9 percent was African American, 14.8 percent was Asian, and 7.9 percent was Latinx. People of color in Los Gatos comprise a proportion below the overall proportion in the Bay Area as a whole0F 1 .
▪ Employment – The Town of Los Gatos residents most commonly work in the Financial and Professional Services industry. From January 2010 to January 2021, the unemployment rate in the Town decreased by

2.9 percent. Since 2010, the number of jobs located in the jurisdiction increased by 4,440 (28.8 percent).

Additionally, the jobs-household ratio in the Town of Los Gatos has increased from 1.32 jobs per household in 2002 to 1.59 in 2018.
▪ Number of Homes – The number of new homes built in the Bay Area has not kept pace with the demand, resulting in longer commutes, increasing prices, and exacerbating issues of displacement and homelessness. The number of homes in the Town of Los Gatos increased 4.5 percent from 2010 to 2020, 1 The Census Bureau’s American Community Survey accounts for ethnic origin separate from racial identity. The numbers reported here use an accounting of both such that the racial categories are shown exclusive of Latinx status, to allow for an accounting of the Latinx population regardless of racial identity.

The term Hispanic has historically been used to describe people from numerous Central American, South American, and Caribbean countries. In recent years, the term Latino or Latinx has become preferred. This report generally uses Latinx, but occasionally when discussing US Census data, we use Hispanic or Non-Hispanic, to clearly link to the data source.

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B-2 Appendix B October 2022
which is below the growth rate for Santa Clara County and below the growth rate of the region’s housing stock during this time period1F
2 .
▪ Home Prices – A diversity of homes at all income levels would create opportunities for all of the Los Gatos community to live in Town.
✓ Ownership – The largest proportion of homes had a value greater than $2 million in 2019. Home prices increased by 98.4 percent from 2010 to 2020.
✓ Rental Prices – The typical contract rent for an apartment in the Town of Los Gatos was $2,270 in 2019. Rental prices increased by 60.9 percent from 2009 to 2019. To rent a typical apartment without cost burden, a household would need to make $90,960 per year 2F

3. ▪ Housing Type – It is important to have a variety of housing types to meet the needs of a community today and in the future. In 2020, 60 percent of homes in the Town of Los Gatos were single-family detached, 13 percent were single-family attached, 9 percent were small multi-family (two to four units), and 18 percent were medium or large multi-family (five or more units). Between 2010 and 2020, the number of singlefamily units increased more than multi-family units. Los Gatos has a higher portion of detached singlefamily homes than other jurisdictions in the region. ▪ Housing Demand – The Town is populated with a higher share of high-income earners (65% greater than 100% of AMI) than the rest of the county, therefore, housing is built for these higher income and amenity levels. Without goals, policies and programs that specifically address the need to build “affordable housing” targeting incomes less than 100% of AMI (not above greater than 100% AMI), it is highly unlikely developers will voluntarily build housing for low and very-low-income levels. ▪ Cost Burden – The U.S. Department of Housing and Urban Development (HUD) considers housing to be affordable for a household if the household spends less than 30 percent of its income on housing costs. A household is considered “cost-burdened” if it spends more than 30 percent of its monthly income on housing costs, while those who spend more than 50 percent of their income on housing costs are considered “severely cost-burdened.” In the Town of Los Gatos, 20 percent of households spend 30 percent to 50 percent of their income on housing, while 16 percent of households are severely cost burdened and use the majority of their income for housing. ▪ Displacement/Gentrification – According to research from the University of California (UC), Berkeley no households in the Town of Los Gatos live in neighborhoods that are susceptible to or experiencing displacement, and none live in areas at risk of or undergoing gentrification. All households in the Town live in neighborhoods where low-income households are likely excluded due to prohibitive housing costs. ▪ Neighborhood – All residents in Los Gatos live in neighborhoods identified as “Highest Resource” or “High Resource” areas by State-commissioned research, while no residents live in areas identified by this research as “Low Resource” or “High Segregation and Poverty” areas. These neighborhood designations are based on a range of indicators covering areas such as education, poverty, proximity to jobs and economic opportunities, low pollution levels, and other factors 3F 4 .
2 According to HCD Annual Progress Report Dashboard (as of September 20, 2021). 3 Note that contract rents may differ significantly from, and often being lower than, current listing prices. 4 For more information on the “opportunity area” categories developed by HCD and the California Tax Credit Allocation Committee, see this website:
https://www.treasurer.ca.gov/ctcac/opportunity.asp. The degree to which different jurisdictions and neighborhoods have access to opportunity will likely need to be analyzed as part of new Housing Element requirements related to affirmatively furthering fair housing. ABAG/MTC will be providing jurisdictions with technical assistance on this topic this summer, following the release of additional guidance from HCD.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-3
▪ Special Housing Needs – Some population groups may have special housing needs that require specific program responses, and these groups may experience barriers to accessing stable housing due to their specific housing circumstances. In Los Gatos, 9 percent of residents have a disability (physical, developmental, etc.), and may require accessible housing. Additionally, 6 percent of Los Gatos households are larger households with five or more people and likely need larger housing units with three bedrooms or more. 8.2 percent of households are female-headed families, which are often at greater risk of housing insecurity.

B.2 Population, Employment, and Household
Characteristics
Population
The Bay Area is the fifth-largest metropolitan area in the nation and has seen a steady increase in population since 1990, except for a dip during the Great Recession. Many towns and cities in the region have experienced significant growth in jobs and population. While these trends have led to a corresponding increase in demand for housing across the region, the regional production of housing has largely not kept pace with job and population growth.

According to the data, the population of the Town of Los Gatos was estimated to be 31,439 in 2020. The population of Los Gatos makes up 1.6 percent of Santa Clara County4F 5 . In Los Gatos, roughly 13.5 percent of its
population moved during the past year, a number that is roughly the same as the regional rate of 13.4 percent.

Table B-1 shows population growth trends for the Town of Los Gatos, Santa Clara County, and the Bay Area as a whole.

Table B-1 Population Growth Trends
Geography 1990 1995 2000 2005 2010 2015 2020
Town of Los Gatos 27,357 28,751 28,592 28,872 29,413 30,807 31,439 Santa Clara County 1,497,577 1,594,818 1,682,585 1,752,696 1,781,642 1,912,180 1,961,969 Bay Area 6,020,147 6,381,961 6,784,348 7,073,912 7,150,739 7,595,694 7,790,537 SOURCE: California Department of Finance, E-5 series.

NOTE: Universe: Total population; Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-01.

Since 2000, the Town of Los Gatos population has increased by approximately 10 percent, which is below the rate for the region as a whole, at 14.8 percent. From 1990 to 2000, the population increased by 4.5 percent.

During the first decade of the 2000’s the population increased by 2.9 percent. In the most recent decade, the population increased by 6.9 percent. Figure B-1 shows population growth trends in percentages.

In 2019 the Town of Los Gatos annexed 24 urban islands totaling 116.1 acres. The islands were comprised of approximately 308 single-family residences and the staff report assumed 2.2 persons per household for an estimated increase in population of 678.
5 To compare the rate of growth across various geographic scales, Figure B-1 shows population for the jurisdiction, county, and region indexed to the population in the year 1990. This means that the data points represent the population growth (i.e., percent change) in each of these geographies relative to their populations in 1990.

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B-4 Appendix B October 2022
Figure B-1 Population Growth Trends
Source: California Department of Finance, E-5 series.

Note: The data shown on the graph represents population for the jurisdiction, county, and region indexed to the population in the first year shown. The data points represent the relative population growth in each of these geographies relative to their populations in that year. For some jurisdictions, a break may appear at the end of each decade (1999, 2009) as estimates are compared to census counts. DOF uses the decennial census to benchmark subsequent population estimates. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-01
Age
The distribution of age groups in a community shapes what types of housing the community may need in the near future. An increase in the older population may mean there is a developing need for more senior housing options, while higher numbers of children and young families can point to the need for more family housing options and related services. There has also been a move by many to age-in-place or downsize to stay within their communities, which can mean more multi-family and accessible units are needed.

In the Town of Los Gatos, the median age in 2000 was approximately 41 years. By 2019, the median age increased to approximately 47 years. The cohorts age 25 to 34 and age 35 to 44 decreased between 2000 and 2019, while all age cohorts 55 and above increased during the same time period. Figure B-2 shows population by age for the years 2000, 2010, and 2019 for the Town of Los Gatos.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-5
Figure B-2 Los Gatos Population by Age, 2000-2019
Source: U.S. Census Bureau, Census 2000 SF1, Table P12; U.S. Census Bureau, Census 2010 SF1, Table P12; U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B01001. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP04.

Note: Universe: Total population.

Looking at the senior and youth population by race can add an additional layer of understanding, as families and seniors of color are even more likely to experience challenges finding affordable housing. People of color 5F 6 make
up 13.4 percent of seniors and 23.7 percent of youth under 18. Figure B-3 shows population age by race for the Town of Los Gatos.
6 Here, all non-white racial groups are counted.

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B-6 Appendix B October 2022
Figure B-3 Los Gatos Population Age by Race
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B01001(A-G). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table SEN-02.

Notes: Universe: Total population. In the sources for this table, the Census Bureau does not disaggregate racial groups by Hispanic/Latinx ethnicity, and an overlapping category of Hispanic / non-Hispanic groups has not been shown to avoid double counting in the stacked bar chart.

Race and Ethnicity
Understanding the racial makeup of the Town and region is important for designing and implementing effective housing policies and programs. These patterns are shaped by both market factors and government actions, such as exclusionary zoning, discriminatory lending practices, and displacement that has occurred over time and continues to impact communities of color today 6F
7 .

Since 2000, the percentage of residents in the Town of Los Gatos identifying as White, Non-Hispanic has decreased by 13.3 percentage points, with this 2019 population standing at 22,231. At the same time the percentage of residents of all Other Race of Multiple Races, Non-Hispanic has increased. In absolute terms, the Asian/API, Non-Hispanic population increased the most while the White, Non-Hispanic population decreased the most. Figure B-4 shows population for the Town of Los Gatos by race for 2000, 2010, and 2019. 7 See, for example, Rothstein, R. (2017). The color of law: a forgotten history of how our government segregated America. New York, NY & London, UK:

Liveright Publishing.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-7
Figure B-4 Los Gatos Population by Race, 2000-2019
Source: U.S. Census Bureau, Census 2000, Table P004; U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B03002. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-02.

Notes: Universe: Total population. Data for 2019 represents 2015-2019 ACS estimates. The Census Bureau defines Hispanic/Latinx ethnicity separate from racial categories. For the purposes of this graph, the “Hispanic or Latinx” racial/ethnic group represents those who identify as having Hispanic/Latinx ethnicity and may also be members of any racial group. All other racial categories on this graph represent those who identify with that racial category and do not identify with Hispanic/Latinx ethnicity.

Employment Trends
Balance of Jobs and Workers
A town houses employed residents who either work in the community where they live or work elsewhere in the region. Conversely, a town may have job sites that employ residents from the same town, but more often employ workers that commute from outside of it. Smaller towns typically will have more employed residents than jobs and export workers, while larger towns tend to have a surplus of jobs and import workers. To some extent the regional transportation system (bus system, for example) is set up for this flow of workers to the region’s core job centers. At the same time, as the housing affordability crisis has illustrated, local imbalances may be severe, where local jobs and worker populations are out of sync at a sub-regional scale. One measure of this is the relationship between workers and jobs. A town with a surplus of workers “exports” workers to other parts of the region, while a town with a surplus of jobs must conversely “import” them. Between 2002 and 2018, the number of jobs in the Town of Los Gatos increased by 23.8 percent. Figure 3-5 shows jobs in the Town of Los Gatos between 2002 and 2018.

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B-8 Appendix B October 2022
Figure B-5 Los Gatos Jobs in a Jurisdiction
Source: U.S. Census Bureau, Longitudinal Employer-Household Dynamics, Workplace Area Characteristics (WAC) files, 2002-2018. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-11.

Notes: Universe: Jobs from unemployment insurance-covered employment (private, state and local government) plus United States Office of Personnel Management-sourced Federal employment. The data is tabulated by place of work, regardless of where a worker lives. The source data is provided at the census block level. These are cross walked to jurisdictions and summarized.

The figure below shows the balance when comparing jobs to workers, broken down by different wage groups, offering additional insight into local dynamics. A community may offer employment for relatively low-income workers, but have relatively few housing options for those workers. Conversely, it may house residents who are low-wage workers, but offer few employment opportunities for them. Such relationships may cast extra light on potentially pent-up demand for housing in particular price categories. A relative surplus of jobs relative to residents in a given wage category suggests the need to import those workers, while conversely, surpluses of workers mean the community will export those workers to other jurisdictions. Such flows are not inherently bad, though over time, sub-regional imbalances may appear. The Town has more jobs than residents in wage categories below $75,000 per year. At the high end of the wage spectrum (i.e., wages over $75,000 per year), the Town has more high-wage residents than high-wage jobs7F 8 . Figure B-6 shows workers by earnings, place of
residence, and place of work within the jurisdiction of the Town of Los Gatos. 8 The source table is top coded at $75,000, precluding more fine-grained analysis at the higher end of the wage spectrum.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-9
Figure B-6 Workers by Earnings, by Los Gatos Jurisdiction as Place of Work and Place of Residence Source: U.S. Census Bureau, American Community Survey 5-Year Data 2015-2019, B08119, B08519. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-10.

Notes: Universe: Los Gatos Workers 16 years and over with earnings.

The next diagram shows the ratio of jobs to workers, by wage group. A value of 1.00 means that the Town has the same number of jobs in a wage group as it has resident workers, in principle, a balance. Values above 1.00 indicate a jurisdiction will need to import workers for jobs in a given wage group. Figure B-7 shows jobs to worker ratios for the Town Los Gatos.

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B-10 Appendix B October 2022
Figure B-7 Los Gatos Jobs-Worker Ratios, By Wage Group
Source: U.S. Census Bureau, Longitudinal Employer-Household Dynamics, Workplace Area Characteristics (WAC) files (Jobs); Residence Area Characteristics (RAC) files (Employed Residents), 2010-2018. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-14.

Notes: Universe: Jobs in a jurisdiction from unemployment insurance-covered employment (private, state and local government) plus United States Office of Personnel Management-sourced Federal employment. The ratio compares job counts by wage group from two tabulations of LEHD data: Counts by place of work relative to counts by place of residence. See text for details.

Such balances between jobs and workers may directly influence the housing demand in a community. New jobs may draw new residents, and when there is high demand for housing relative to supply, many workers may be unable to afford to live where they work, particularly where job growth has been in relatively lower wage jobs. The Town is a “net importer of workers” at the low-wage group, while at the high-wage group the Town is “exporting workers.” This dynamic not only means many workers will need to prepare for long commutes and time spent on the road, but in the aggregate, it contributes to traffic congestion and time lost for all road users.

If there are more jobs than employed residents, it means a community is relatively jobs-rich, typically also with a high jobs-per-employed-resident ratio. Therefore, bringing housing into the measure, the jobs per employed resident ratio in the Town of Los Gatos has increased from 1.32 in 2002, to 1.59 jobs per employed resident in 2018. In short, the Town of Los Gatos is a net importer of workers. Figure B-8 shows the Town of Los Gatos jobs per household ratio.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-11
Figure B-8 Jobs-Household Ratio
Source: U.S. Census Bureau, Longitudinal Employer-Household Dynamics, Workplace Area Characteristics (WAC) files (Jobs), 2002-2018; California Department of Finance, E-5 (Households). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-13.

Notes: Universe: Jobs in a jurisdiction from unemployment insurance-covered employment (private, state and local government) plus United States Office of Personnel Management-sourced Federal employment; households in a jurisdiction. The data is tabulated by place of work, regardless of where a worker lives. The source data is provided at the census block level. These are cross walked to jurisdictions and summarized. The ratio compares place of work wage and salary jobs with households, or occupied housing units. A similar measure is the ratio of jobs to housing units. However, this jobs-household ratio serves to compare the number of jobs in a jurisdiction to the number of housing units that are actually occupied. The difference between a jurisdiction’s jobs-housing ratio and jobs-household ratio will be most pronounced in jurisdictions with high vacancy rates, a high rate of units used for seasonal use, or a high rate of units used as short-term rentals.

Sector Composition
In terms of sectoral composition, the largest industry in which the Town of Los Gatos residents work is Financial and Professional Services, and the largest sector in which Santa Clara residents work is Health and Educational Services. For the Bay Area as a whole, the Health and Educational Services industry employs the most workers.

Figure B-9 shows resident employment by industry.

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B-12 Appendix B October 2022
Figure B-9 Resident Employment by Industry
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table C24030. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-06.

Notes: Universe: Civilian employed population age 16 years and over. The data displayed shows the industries in which jurisdiction residents work, regardless of the location where those residents are employed (whether within the jurisdiction or not). Categories are derived from the following source tables: Agriculture & Natural Resources: C24030_003E, C24030_030E; Construction: C24030_006E, C24030_033E; Manufacturing, Wholesale & Transportation: C24030_007E, C24030_034E, C24030_008E, C24030_035E, C24030_010E, C24030_037E; Retail: C24030_009E, C24030_036E; Information: C24030_013E, C24030_040E; Financial & Professional Services:

C24030_014E, C24030_041E, C24030_017E, C24030_044E; Health & Educational Services: C24030_021E, C24030_024E, C24030_048E, C24030_051E; Other: C24030_027E, C24030_054E, C24030_028E, C24030_055E.

Unemployment
In the Town of Los Gatos, there was a 2.9 percentage point decrease in the unemployment rate between January 2010 and January 2021. Jurisdictions throughout the region experienced a sharp rise in unemployment in 2020 due to impacts related to the COVID-19 pandemic, though with a general improvement and recovery in the later months of 2020. Figure B-10 shows the unemployment rates over the last decade for the Town of Los Gatos, Santa Clara County, and the Bay Area as a whole.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-13
Figure B-10 Los Gatos Unemployment Rate
Source: California Employment Development Department, Local Area Unemployment Statistics (LAUS), Sub-county areas monthly updates, 2010-2021. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-15.

Notes: Universe: Civilian noninstitutional population ages 16 and older. Unemployment rates for the jurisdiction level is derived from larger-geography estimates. This method assumes that the rates of change in employment and unemployment are exactly the same in each sub-county area as at the county level. If this assumption is not true for a specific sub-county area, then the estimates for that area may not be representative of the current economic conditions. Since this assumption is untested, caution should be employed when using these data. Only not seasonally-adjusted labor force (unemployment rates) data are developed for cities and CDPs.

Extremely Low-Income Households
Despite the economic and job growth experienced throughout the region since 1990, the income gap has continued to widen. California is one of the most economically unequal states in the nation, and the Bay Area has the highest income inequality between high- and low-income households in the state8F 9 .

In the Town of Los Gatos, 65 percent of households make more than 100 percent of the Area Median Income (AMI)9F
10, compared to 8.6 percent making less than 30 percent of AMI, which is considered extremely low-income.

Regionally, more than half of all households make more than 100 percent AMI, while 15 percent make less than 30 percent AMI. In Santa Clara County, 30 percent AMI is the equivalent to the annual income of $39,900 for a family of four. Many households with multiple wage earners, including food service workers, full-time students, teachers, farmworkers, and healthcare professionals, can fall into lower AMI categories due to relatively stagnant wages in many industries. Figure B-11 shows households by income level. 9 Bohn, S.et al. 2020. Income Inequality and Economic Opportunity in California. Public Policy Institute of California. 10 Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), S1anta Rosa Metro

HCD Draft Initial Review 2023-2031 Housing Element
B-14 Appendix B October 2022
Figure B-11 Households by Household Income Level
Source: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table ELI-01.

Notes: Universe: Occupied housing units. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located. The data that is reported for the Bay Area is not based on a regional AMI but instead refers to the regional total of households in an income group relative to the AMI for the county where that household is located. Local jurisdictions are required to provide an estimate for their projected extremely low-income households (0-30 percent AMI) in their Housing Elements. HCD’s official Housing Element guidance notes that jurisdictions can use their RHNA for very low-income households (those making 0-50 percent AMI) to calculate their projected extremely low-income households. As Bay Area jurisdictions have not yet received their final RHNA numbers, this document does not contain the required data point of projected extremely low-income households. The report portion of the housing data needs packet contains more specific guidance for how local staff can calculate an estimate for projected extremely low-income households once jurisdictions receive their 6th cycle RHNA numbers. AMI levels in this chart are based on the HUD metro area where this jurisdiction is located. Households making between 80 and 120 percent of the AMI are moderate-income, those making 50 to 80 percent are low income, those making 30 to 50 percent are very low-income, and those making less than 30 percent are extremely low-income. This is then adjusted for household size.

Throughout the region, there are disparities between the incomes of homeowners and renters. Typically, the number of low-income renters greatly outpaces the amount of housing available that is affordable for these households. In the Town of Los Gatos, the largest proportion of renters falls in the Greater than 100 percent of AMI group, while the largest proportion of homeowners are found in the Greater than 100 percent of AMI group.

Figure B-12 shows household income by tenure.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-15
Figure B-12 Los Gatos Household Income Level by Tenure
Source: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-21.

Notes: Universe: Occupied housing units. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located.

Currently, people of color are more likely to experience poverty and financial instability as a result of Federal, State, and local housing policies that have historically excluded them from the same opportunities extended to White residents10F
11 . These economic disparities also leave communities of color at higher risk for housing insecurity, displacement, or homelessness.

In the Town of Los Gatos, Hispanic or Latinx and Other Race or Multiple Races (Hispanic and Non-Hispanic) residents experience the highest rates of poverty, followed by White (Hispanic and Non-Hispanic) residents.

Figure B-13 shows poverty status by race.
11 Moore, E., Montojo, N. and Mauri, N., 2019. Roots, Race & Place: A History of Racially Exclusionary Housing the San Francisco Bay Area. Hass Institute.

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B-16 Appendix B October 2022
Figure B-13 Los Gatos Poverty Status by Race
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B17001(A-I). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table ELI-03.

Notes: Universe: Population for whom poverty status is determined. The Census Bureau uses a federally defined poverty threshold that remains constant throughout the country and does not correspond to Area Median Income. For this table, the Census Bureau does not disaggregate racial groups by Hispanic/Latinx ethnicity. However, data for the white racial group is also reported for white householders who are not Hispanic/Latinx. Since residents who identify as white and Hispanic/Latinx may have very different experiences within the housing market and the economy from those who identify as white and non-Hispanic/Latinx, data for multiple white sub-groups are reported here. The racial/ethnic groups reported in this table are not all mutually exclusive. Therefore, the data should not be summed as the sum exceeds the population for whom poverty status is determined for this jurisdiction. However, all groups labelled “Hispanic and Non-Hispanic” are mutually exclusive, and the sum of the data for these groups is equivalent to the population for whom poverty status is determined.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-17
Tenure
The number of residents who own their homes compared to those who rent their homes can help identify the level of housing insecurity (i.e., ability for individuals to stay in their homes) in a town or city and region. Generally, renters may be displaced more quickly if prices increase.

In the Town of Los Gatos as of 2019, there are a total of 12,083 housing units, and fewer residents rent than own their homes: 35.1 percent versus 64.9 percent. By comparison, 43.6 percent of households in Santa Clara County are renters, while 43.9 percent of Bay Area households rent their homes. Figure B-14 shows housing tenure for Los Gatos, Santa Clara County, and the Bay Area as a whole.

Figure B-14 Housing Tenure
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25003. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-16.

Notes: Universe: Occupied housing units.

Homeownership rates often vary considerably across race and ethnicity in the Bay Area and throughout the country. These disparities not only reflect differences in income and wealth, but also stem from Federal, State, and local policies that limited access to homeownership for communities of color while facilitating homebuying for White residents. While many of these policies, such as redlining, have been formally disbanded, the impacts of race-based policy are still evident across Bay Area communities. 11F 12 In Los Gatos, 84 percent of Black households owned their homes, while homeownership rates were 72 percent for Asian households, 39 percent for Latinx households, and 65 percent for White households. Notably, recent changes to State law require local jurisdictions to examine these dynamics and other fair housing issues when updating their Housing Elements. Figure B-15 shows housing tenure by the race of the householder. 12 See, for example, Rothstein, R. (2017). The color of law: a forgotten history of how our government segregated America. New York, NY & London, UK:

Liveright Publishing.

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B-18 Appendix B October 2022
Figure B-15 Los Gatos Housing Tenure by Race of Householder Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25003(A-I). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-20.

Notes: Universe: Occupied housing units. For this table, the Census Bureau does not disaggregate racial groups by Hispanic/Latinx ethnicity. However, data for the white racial group is also reported for white householders who are not Hispanic/Latinx. Since residents who identify as white and Hispanic/Latinx may have very different experiences within the housing market and the economy from those who identify as white and non-Hispanic/Latinx, data for multiple white sub-groups are reported here. The racial/ethnic groups reported in this table are not all mutually exclusive. Therefore, the data should not be summed as the sum exceeds the total number of occupied housing units for this jurisdiction. However, all groups labelled “Hispanic and Non-Hispanic” are mutually exclusive, and the sum of the data for these groups is equivalent to the total number of occupied housing units.

The age of residents who rent or own their home can also signal the housing challenges a community is experiencing. Younger households tend to rent and may struggle to buy a first home in the Bay Area due to high housing costs. At the same time, senior homeowners seeking to downsize may have limited options in an expensive housing market.

In the Town of Los Gatos, 77.2 percent of householders between the ages of 25 and 34 are renters, and 36.4 percent of householders over 85 are renters. Figure B-16 shows housing tenure by age.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-19
Figure B-16 Los Gatos Housing Tenure by Age
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25007. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-18.

Notes: Universe: Occupied housing units.

In many communities, homeownership rates for households in single-family homes are substantially higher than the rates for households in multi-family housing. In the Town of Los Gatos, 86.2 percent of households in detached single-family homes are homeowners, while 13.2 percent of households in multi-family housing are homeowners. Figure B-17 shows housing tenure by housing type.

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B-20 Appendix B October 2022
Figure B-17 Los Gatos Housing Tenure by Housing Type
Source: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25032. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-22.

Notes: Universe: Occupied housing units.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-21
Displacement
Because of increasing housing prices, displacement is a major concern in the Bay Area. Displacement has the most severe impacts on low- and moderate-income residents. When individuals or families are forced to leave their homes and communities, they also lose their support network.

The University of California UC, Berkeley, has mapped all neighborhoods in the Bay Area, identifying their risk for gentrification. They find that in the Town of Los Gatos, there are no households that live in neighborhoods that are susceptible to or experiencing displacement and none live in neighborhoods at risk of or undergoing gentrification. Equally important, some neighborhoods in the Bay Area do not have housing appropriate for a broad section of the workforce. The University of California, Berkeley, estimates that all households in the Town of Los Gatos live in neighborhoods where low-income households are likely to be excluded due to prohibitive housing costs 12F
13 . Figure B-18 shows household displacement risk and tenure.

Figure B-18 Los Gatos Households by Displacement Risk and Tenure Source: Urban Displacement Project for classification, American Community Survey 5-Year Data (2015-2019), Table B25003 for tenure.

Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-25.

Notes: Universe: Households. Displacement data is available at the census tract level. Staff aggregated tracts up to jurisdiction level using census 2010 population weights, assigning a tract to jurisdiction in proportion to block level population weights. Total household count may differ slightly from counts in other tables sourced from jurisdiction level sources. Categories are combined as follows for simplicity:

At risk of or Experiencing Exclusion: At Risk of Becoming Exclusive; Becoming Exclusive; Stable/Advanced Exclusive At risk of or Experiencing Gentrification: At Risk of Gentrification; Early/Ongoing Gentrification; Advanced Gentrification Stable Moderate/Mixed Income: Stable Moderate/Mixed Income Susceptible to or Experiencing Displacement: Low-Income/Susceptible to Displacement; Ongoing Displacement Other: High Student Population; Unavailable or Unreliable Data. 13 More information about this gentrification and displacement data is available at the Urban Displacement Project’s webpage:
https://www.urbandisplacement.org/. Specifically, one can learn more about the different gentrification/displacement typologies shown in Figure 18 at this link: https://www.urbandisplacement.org/sites/default/files/typology_sheet_2018_0.png. Additionally, one can view maps that show which typologies correspond to which parts of a jurisdiction here: https://www.urbandisplacement.org/san-francisco/sf-bay-area-gentrification-anddisplacement

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B-22 Appendix B October 2022
B.3 Housing Stock Characteristics
Housing Types, Year Built, Vacancy, and Permits
In recent years, most housing produced in the region and across the State consisted of single-family homes and larger multi-unit buildings. However, some households are increasingly interested in “missing middle housing” or “Small Multi-Unit Housing, including duplexes, triplexes, townhomes, cottage clusters, and accessory dwelling units. These housing types may open up more options across incomes and tenure, from young households seeking homeownership options to seniors looking to downsize and age-in-place.

The housing stock of the Town of Los Gatos in 2020 was made up of 60 percent Single-Family Home: Detached, 13 percent Single-Family Home: Attached, 9 percent Multi-family Housing: Two to Four Units, 18 percent Multifamily Housing: Five-Plus Units, and 0.5 percent Mobile Homes. In Los Gatos, the housing type that experienced the most growth between 2010 and 2020 was Single-Family Home: Detached. Figure B-19 shows housing type trends in Los Gatos for 2010 and 2020.

Figure B-19 Los Gatos Housing Type Trends
SOURCE: California Department of Finance, E-5 series. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-01.

NOTE: Universe: Housing units.

Production has not kept up with housing demand for several decades in the Bay Area, as the total number of units built and available has not yet come close to meeting the population and job growth experienced throughout the region. In the Town of Los Gatos, the largest proportion of the housing stock was Built 1960 to 1979, with 6,630 units constructed during this period. Since 2010, 2.6 percent of the current housing stock was built, which is 342 units (U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25034). Figure B-20 shows housing units by the year built.

59.6%

13.0%

9.0%

17.9%

0.5%

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-23
Figure B-20 Los Gatos Housing Units by Year Structure Built SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25034. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-04.

NOTE: Universe: Housing units.

Throughout the Bay Area, vacancies make up 2.6 percent of the total housing units, with homes listed for rent, units used for Recreational or Occasional Use, and units not otherwise classified (Other Vacant) making up the majority of vacancies. The Census Bureau classifies a unit as vacant if no one is occupying it when census interviewers are conducting the American Community Survey or Decennial Census. Vacant units classified as For Recreational or Occasional Use are those that are held for short-term periods of use throughout the year.

Accordingly, vacation rentals and short-term rentals like Airbnb are likely to fall in this category. The Census Bureau classifies units as Other Vacant if they are vacant due to foreclosure, personal/family reasons, legal proceedings, repairs/renovations, abandonment, preparation for being rented or sold, or vacant for an extended absence for reasons such as a work assignment, military duty, or incarceration1 3F 14 . In a region with a thriving
economy and housing market like the Bay Area, units being renovated/repaired and prepared for rental or sale are likely to represent a large portion of the Other Vacant category. Additionally, the need for seismic retrofitting in older housing stock could also influence the proportion of Other Vacant units in some jurisdictions 14F 15 .

Vacant units make up 7.5 percent of the overall housing stock in the Town of Los Gatos. The rental vacancy stands at 8.2 percent, while the ownership vacancy rate is 0.4 percent. Of the vacant units in the Town of Los Gatos, the most common type of vacancy is Other Vacant, which represents almost half of all vacant rental units15F
16 . Figure B-21 shows vacant units by type.
14 For more information, see pages 3 through 6 of this list of definitions prepared by the Census Bureau:
https://www.census.gov/housing/hvs/definitions.pdf.
15 See Dow, P. (2018). Unpacking the Growth in San Francisco’s Vacant Housing Stock: Client Report for the San Francisco Planning Department. University of California, Berkeley.
16 The vacancy-rates-by-tenure is for a smaller universe than the total vacancy rate first reported, which in principle includes the full stock (7.5 percent).

The vacancy by tenure counts are rates relative to the rental stock (occupied and vacant) and ownership stock (occupied and vacant) but exclude a significant number of vacancy categories, including the numerically significant other vacant.

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B-24 Appendix B October 2022
Figure B-21 Los Gatos Vacant Units by Type
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25004. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-03.

NOTE: Universe: Vacant housing units.

Between 2015 and 2020, 502 housing units were issued building permits in the Town of Los Gatos. Of those, approximately percent were for above moderate-income housing, approximately percent were for moderateincome housing, and approximately 1.0 percent were for low-income, and approximately 17.0 percent were for very low-income housing. Table B-2 shows residential building permits issued by the Town of Los Gatos by income group.

Table B-2 Los Gatos, Residential Building Permits by Income Group, 2015 to 2020 Income Group Number Percent
Very Low-Income Permits 49 revise all below
Low-Income Permits 3
Moderate-Income Permits 119
Above Moderate-Income Permits 331
Total 502 100.0%
SOURCE: California Department of Housing and Community Development (HCD), 5th Cycle Annual Progress Report Permit Summary (2020). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-11.

NOTE: Universe: Housing permits issued between 2015 and 2021. Notes: HCD uses the following definitions for the four income categories:

Very Low Income: units affordable to households making less than 50 percent of the Area Median Income for the county in which the jurisdiction is located. Low Income: units affordable to households making between 50 percent and 80 percent of the Area Median Income for the county in which the jurisdiction is located. Moderate Income: units affordable to households making between 80 percent and 120 percent of the Area Median Income for the county in which the jurisdiction is located. Above Moderate Income: units affordable to households making above 120 percent of the Area Median Income for the county in which the jurisdiction is located.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-25
Assisted Housing Developments At-Risk of Conversion
While there is a need to produce new affordable housing units, ensuring that the existing affordable housing stock remains affordable is also important. Additionally, it is typically faster and less expensive to preserve currently affordable units that are at risk of converting to market-rate than it is to build new affordable housing.

The data in the table below comes from the California Housing Partnership’s Preservation Database, the State’s most comprehensive source of information on subsidized affordable housing at risk of losing its affordable status and converting to market-rate housing16F
17 . According to the data, there are 169 assisted units in the Town of Los Gatos. Of these units, none were at high risk or very high risk of conversion. Table B-3 summarizes assisted units at risk in the Town of Los Gatos.

Table B-3 Assisted Units at Potential Risk of Conversion Income Los Gatos Santa Clara County Bay Area
Low-Income Units 169 28,001 110,177
Moderate-Income Units 0 1,471 3,375
High-Income Units 0 422 1,854
Very High-Income Units 0 270 1,053
Total 169 30,164 116,459
SOURCE: California Housing Partnership, Preservation Database (2020). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table RISK01.

NOTE: Universe: HUD, Low-Income Housing Tax Credit (LIHTC), USDA, and CalHFA projects. Subsidized or assisted developments that do not have one of the aforementioned financing sources may not be included. While California Housing Partnership’s Preservation Database is the state’s most comprehensive source of information on subsidized affordable housing at risk of losing its affordable status and converting to market-rate housing, this database does not include all deed-restricted affordable units in the state. Consequently, there may be at-risk assisted units in a jurisdiction that are not captured in this data table. Per HCD guidance, local jurisdictions must also list the specific affordable housing developments at-risk of converting to market rate uses. This document provides aggregate numbers of at risk units for each jurisdiction, but local planning staff should contact Danielle Mazzella with the California Housing Partnership at [email protected] to obtain a list of affordable properties that fall under this designation. California Housing Partnership uses the following categories for assisted housing developments in its database: Very-High Risk: affordable homes that are at-risk of converting to market rate within the next year that do not have a known overlapping subsidy that would extend affordability and are not owned by a large/stable non-profit, mission-driven developer. High Risk: affordable homes that are at-risk of converting to market rate in the next 1-5 years that do not have a known overlapping subsidy that would extend affordability and are not owned by a large/stable non-profit, mission-driven developer. Moderate Risk: affordable homes that are at-risk of converting to market rate in the next 5-10 years that do not have a known overlapping subsidy that would extend affordability and are not owned by a large/stable non-profit, mission-driven developer. Low Risk: affordable homes that are at-risk of converting to market rate in 10+ years and/or are owned by a large/stable nonprofit, mission-driven developer.

Substandard Housing
Housing costs in the region are among the highest in the country, which could result in households, particularly renters, needing to live in substandard conditions in order to afford housing. Generally, there is limited data on the extent of substandard housing issues in a community. However, the Census Bureau data included in the graph below gives a sense of some of the substandard conditions that may be present in Los Gatos. For example, 4.1 percent of renters in Los Gatos reported lacking a kitchen and 1.4 percent of renters lack plumbing, compared to 0.4 percent of owners who lack a kitchen and 0.6 percent of owners who lack plumbing. Figure B-22 shows substandard housing issues in Los Gatos.
17 This database does not include all deed-restricted affordable units in the state, so there may be at-risk assisted units in a jurisdiction that are not captured in this data table.

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B-26 Appendix B October 2022
Figure B-22 Los Gatos Substandard Housing Issues
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25053, Table B25043, Table B25049 Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-06.

NOTES: Universe: Occupied housing units. Per HCD guidance, this data should be supplemented by local estimates of units needing to be rehabilitated or replaced based on recent windshield surveys, local building department data, knowledgeable builders/developers in the community, or nonprofit housing developers or organizations.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-27
Home and Rent Values
Home prices reflect a complex mix of supply and demand factors, including an area’s demographic profile, labor market, prevailing wages, and job outlook, coupled with land and construction costs. In the Bay Area, the costs of housing have long been among the highest in the nation.

The typical home value in Los Gatos was estimated at $2,109,040 in December of 2020, per data from Zillow.

The largest proportion of homes were valued in excess of $2 million. By comparison, the typical home value is $1,290,970 in Santa Clara County and $1,077,230 in the Bay Area, with the largest share of units valued $1 million to $1.5 million (county) and $500 thousand to $750 thousand (region). Figure B-23 shows home values of owner-occupied housing units in Los Gatos.

Figure B-23 Home Values of Owner-Occupied Units
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25075. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-07.

NOTE: Universe: Owner-occupied units.

The region’s home values have increased steadily since 2000, besides a decrease during the Great Recession.

The rise in home prices has been especially steep since 2012, with the median home value in the Bay Area nearly doubling during this time. Since 2001, the typical home value has increased 164.0 percent in Los Gatos from $798,770 to $2,109,040. This change is considerably greater than the change in Santa Clara County and for the region as a whole. Figure B-24 shows Zillow home value index for Los Gatos.

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B-28 Appendix B October 2022
Figure B-24 Zillow Home Value Index (ZHVI)
SOURCE: Zillow, Zillow Home Value Index (ZHVI). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-08.

NOTES: Universe: Owner-occupied housing units. Zillow describes the ZHVI as a smoothed, seasonally adjusted measure of the typical home value and market changes across a given region and housing type. The ZHVI reflects the typical value for homes in the 35th to 65th percentile range. The ZHVI includes all owner-occupied housing units, including both single-family homes and condominiums. More information on the ZHVI is available from Zillow. The regional estimate is a household-weighted average of county-level ZHVI files, where household counts are yearly estimates from DOF’s E-5 series For unincorporated areas, the value is a population weighted average of unincorporated communities in the county matched to census-designated population counts.

Similar to home values, rents have also increased dramatically across the Bay Area in recent years. Many renters have been priced out, evicted, or displaced, particularly communities of color. Residents finding themselves in one of these situations may have had to choose between commuting long distances to their jobs and schools or moving out of the region, and sometimes, out of the State.

In Los Gatos, the largest proportion of rental units rented in the ‘rent $2,000-$2,500 category’, totaling 24.2 percent, followed by 23.7 percent of units renting in the ‘rent $3,000 or More category.’ Looking beyond the Town, the largest share of units in Santa Clara County is in the ‘rent $2,000-$2,500 category’, compared to the ‘rent $1,500-$2,000 category’ for the Bay Area as a whole. Figure B-25 shows contract rents for renter-occupied units in Los Gatos, Santa Clara County, and the Bay Area as a whole.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-29
Figure B-25 Contract Rents for Renter-Occupied Units
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25056. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-09.

NOTE: Universe: Renter-occupied housing units paying cash rent.

Since 2009, the median rent has increased by 33.5 percent in the Town of Los Gatos, from $1,700 to $2,270 per month. In Santa Clara County, the median rent has increased 39.6 percent, from $1,540 to $2,150. The median rent in the region has increased significantly during this time from $1,200 to $1,850, a 54.2 percent increase17F 18 .

Figure B-25 shows median contract rent in the Town of Los Gatos, Santa Clara County, and the Bay Area as a whole.
18 While the data on home values shown in Figure B-24 comes from Zillow, Zillow does not have data on rent prices available for most Bay Area jurisdictions. To have a more comprehensive dataset on rental data for the region, the rent data in this document comes from the U.S. Census Bureau’s American Community Survey, which may not fully reflect current rents. Local jurisdiction staff may want to supplement the data on rents with local realtor data or other sources for rent data that are more current than Census Bureau data.

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B-30 Appendix B October 2022
Figure B-26 Median Contract Rent
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data releases, starting with 2005-2009 through 2015-2019, B25058, B25056 (for unincorporated areas). County and regional counts are weighted averages of jurisdiction median using B25003 rental unit counts from the relevant year. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-10.

NOTES: Universe: Renter-occupied housing units paying cash rent. For unincorporated areas, median is calculated using distribution in B25056.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-31
Overpayment and Overcrowding
A household is considered “cost-burdened” if it spends more than 30 percent of its monthly income on housing costs, while those who spend more than 50 percent of their income on housing costs are considered “severely cost-burdened.” Low-income residents are the most impacted by high housing costs and experience the highest rates of cost burden. Spending such large portions of their income on housing puts low-income households at higher risk of displacement, eviction, or homelessness. While the housing market has resulted in home prices increasing dramatically, homeowners often have mortgages with fixed rates, whereas renters are more likely to be impacted by market increases.

When looking at the cost burden across tenure in the Town of Los Gatos, 20 percent of renters spend 30 percent to 50 percent of their income on housing compared to 16 percent of those that own. Additionally, 22 percent of renters are severely cost-burdened (i.e., spend 50 percent or more of their income on housing), while 12 percent of owners are severely cost-burdened. Figure B-27 shows cost burden by tenure.

Figure B-27 Cost Burden by Tenure, Los Gatos
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25070, B25091. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-06.

NOTES: Universe: Occupied housing units. Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities). For owners, housing cost is “select monthly owner costs”, which includes mortgage payment, utilities, association fees, insurance, and real estate taxes. HUD defines cost-burdened households as those whose monthly housing costs exceed 30 percent of monthly income, while severely cost-burdened households are those whose monthly housing costs exceed 50 percent of monthly income.

When one looks at both renters and owners together in the Town of Los Gatos, 15.6 percent of households spend 50 percent or more of their income on housing, while 17 percent spend 30 percent to 50 percent. However, these rates vary greatly across income categories. For example, 78.3 percent of Los Gatos households making less than 30 percent of AMI spend the majority of their income on housing. For Los Gatos residents making more than 100 percent of AMI, just 3.7 percent are severely cost-burdened, and 83.9 percent of those making more than 100 percent of AMI spend less than 30 percent of their income on housing. Figure B-28 shows cost burden by income level.

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Figure B-28 Cost Burden by Income Level, Los Gatos
SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-05.

NOTES: Universe: Occupied housing units. Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities). For owners, housing cost is “select monthly owner costs”, which includes mortgage payment, utilities, association fees, insurance, and real estate taxes. HUD defines cost-burdened households as those whose monthly housing costs exceed 30 percent of monthly income, while severely cost-burdened households are those whose monthly housing costs exceed 50 percent of monthly income. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located.

Currently, people of color 1 8F
19 are more likely to experience poverty and financial instability as a result of Federal, State, and local housing policies that have historically excluded them from the same opportunities extended to white residents. As a result, they often pay a greater percentage of their income on housing, and in turn, are at a greater risk of housing insecurity.

Hispanic or Latinx residents are the most severely cost burdened with 22 percent spending more than 50 percent of their income on housing. Figure B-29 shows cost burden by race. 19 As before, this category as it is used here includes all non-White persons.

3.7%

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-33
Figure B-29 Cost Burden by Race, Los Gatos
SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-08.

NOTES: Universe: Occupied housing units. Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities). For owners, housing cost is “select monthly owner costs”, which includes mortgage payment, utilities, association fees, insurance, and real estate taxes. HUD defines cost-burdened households as those whose monthly housing costs exceed 30 percent of monthly income, while severely cost-burdened households are those whose monthly housing costs exceed 50 percent of monthly income. For the purposes of this graph, the “Hispanic or Latinx” racial/ethnic group represents those who identify as having Hispanic/Latinx ethnicity and may also be members of any racial group. All other racial categories on this graph represent those who identify with that racial category and do not identify with Hispanic/Latinx ethnicity.

Large family households often have special housing needs due to a lack of adequately sized affordable housing available. The higher costs required for homes with multiple bedrooms can result in larger families experiencing a disproportionate cost burden than the rest of the population and can increase the risk of housing insecurity.

In the Town of Los Gatos, 12.2 percent of large family households experience a cost burden of 30 to 50 percent, while 9.6 percent of households spend more than half of their income on housing. Some 17.8 percent of all other households have a cost burden of 30 percent to 50 percent, with 16.8 percent of households spending more than 50 percent of their income on housing. Figure B-30 shows cost burden by household size.

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Figure B-30 Cost Burden by Household Size, Los Gatos
SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-09.

NOTES: Universe: Occupied housing units. Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities). For owners, housing cost is “select monthly owner costs”, which includes mortgage payment, utilities, association fees, insurance, and real estate taxes. HUD defines cost-burdened households as those whose monthly housing costs exceed 30 percent of monthly income, while severely cost-burdened households are those whose monthly housing costs exceed 50 percent of monthly income.

When cost-burdened seniors are no longer able to make house payments or pay rents, displacement from their homes can occur, putting further stress on the local rental market or forcing residents out of the community they call home. Understanding how seniors might be cost-burdened is of particular importance due to their special housing needs, particularly for low-income seniors.

In the Town of Los Gatos, 74 percent of seniors making less than 30 percent of AMI are spending the majority of their income on housing. For seniors making more than 100 percent of AMI, only 4.3 percent are spending the majority of their income on housing. Figure B-31 shows cost-burdened senior households by income level.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-35
Figure B-31 Cost-Burdened Senior Households by Income Level, Los Gatos SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table SEN-03.

NOTES: Universe: Senior households. For the purposes of this graph, senior households are those with a householder who is aged 62 or older. Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities).

For owners, housing cost is “select monthly owner costs”, which includes mortgage payment, utilities, association fees, insurance, and real estate taxes. HUD defines cost-burdened households as those whose monthly housing costs exceed 30 percent of monthly income, while severely cost-burdened households are those whose monthly housing costs exceed 50 percent of monthly income. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located.

Overcrowding occurs when the number of people living in a household is greater than the home was designed to hold19F
20 . The Census Bureau considers units with more than 1.5 occupants per room to be severely overcrowded.

Overcrowding is often related to the cost of housing and can occur when demand in a town, city, or region is high.

In many towns and cities, overcrowding is seen more amongst those that are renting, with multiple households sharing a unit to make it possible to stay in their communities. In the Town of Los Gatos, 4.3 percent of households that rent are severely overcrowded (i.e., more than 1.5 occupants per room), compared to 0.3 percent of households that own. Figure B-32 shows overcrowding by tenure and severity. 20 There are several different standards for defining overcrowding, but this report uses the Census Bureau definition, which is more than one occupant per room (not including bathrooms or kitchens).

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Figure B-32 Los Gatos Overcrowding by Tenure and Severity SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-01.

NOTES: Universe: Occupied housing units. The Census Bureau defines an overcrowded unit as one occupied by 1.01 persons or more per room (excluding bathrooms and kitchens), and units with more than 1.5 persons per room are considered severely overcrowded.

Overcrowding often disproportionately impacts low-income households. In Los Gatos, less than one percent of very low-income households (i.e., below 50 percent AMI) experience severe overcrowding. The income group most experiencing severe overcrowding is the 81%-100% of AMI group. Figure B-33 shows overcrowding by income level and severity.

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October 2022 Appendix B B-37
Figure B-33 Los Gatos Overcrowding by Income Level and Severity SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-04.

NOTES: Universe: Occupied housing units. The Census Bureau defines an overcrowded unit as one occupied by 1.01 persons or more per room (excluding bathrooms and kitchens), and units with more than 1.5 persons per room are considered severely overcrowded. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose-Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located.

Communities of color are more likely to experience overcrowding similar to how they are more likely to experience poverty, financial instability, and housing insecurity. People of color tend to experience overcrowding at higher rates than White residents. In Los Gatos, the racial group with the largest overcrowding rate is Hispanic or Latinx.

Figure B-34 shows overcrowding by race.

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Figure B-34 Overcrowding by Race, Los Gatos
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25014. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table OVER-03.

NOTES: Universe: Occupied housing units. The Census Bureau defines an overcrowded unit as one occupied by 1.01 persons or more per room (excluding bathrooms and kitchens), and units with more than 1.5 persons per room are considered severely overcrowded. For this table, the Census Bureau does not disaggregate racial groups by Hispanic/Latinx ethnicity. However, data for the white racial group is also reported for white householders who are not Hispanic/Latinx. Since residents who identify as white and Hispanic/Latinx may have very different experiences within the housing market and the economy from those who identify as white and non-Hispanic/Latinx, data for multiple white sub-groups are reported here. The racial/ethnic groups reported in this table are not all mutually exclusive. Therefore, the data should not be summed as the sum exceeds the total number of occupied housing units for this jurisdiction. However, all groups labelled “Hispanic and Non-Hispanic” are mutually exclusive, and the sum of the data for these groups is equivalent to the total number of occupied housing units.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-39
B.4 Special Housing Needs
Large Households
Large households often have different housing needs than smaller households. If the Town’s rental housing stock does not include larger apartments, large households who rent could end up living in overcrowded conditions.

In Los Gatos, for large households with five or more persons, most units were owner occupied. Figure B-35 shows household size by tenure.

Figure B-35 Household Size by Tenure, Los Gatos
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25009. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table LGFEM-01.

NOTE: Universe: Occupied housing units.

The unit sizes available in a community affect the household sizes that can access that community. Large families are generally served by housing units with three or more bedrooms, of which there are 7,760 units in the Town of Los Gatos. Among these large units, most are owner occupied. Figure B-36 summarizes housing units by the number of bedrooms.

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Figure B-36 Housing Units by Number of Bedrooms, Los Gatos SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B25042. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HSG-05.

NOTE: Universe: Housing units.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-41
Female-Headed Households
Households headed by one person are often at greater risk of housing insecurity, particularly female-headed households, who may be supporting children or a family with only one income.

In the Town of Los Gatos, the largest proportion of households is Married-Couple Family Households at 58.1 percent of the total, while Female-Headed Family Households make up 8 percent of all households. Figure B-37 provides information on household type in Los Gatos.

Figure B-37 Household Type
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B11001. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table POPEMP-23.

NOTES: Universe: Households. For data from the Census Bureau, a “family household” is a household where two or more people are related by birth, marriage, or adoption. “Non-family households” are households of one person living alone, as well as households where none of the people are related to each other.

Female-headed households with children may face particular housing challenges, with pervasive gender inequality resulting in lower wages for women. Moreover, the added need for childcare can make finding a home that is affordable more challenging.

In Los Gatos, 36 female-headed households with children (eight percent) fell in the Below Poverty Level category, while 26 female-headed households without children (five percent) fell in the Below Poverty Level category.

Figure B-38 shows female-headed households by poverty status.

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Figure B-38 Female-Headed Households by Poverty Status, Los Gatos SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B17012. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table LGFEM-05.

NOTES: Universe: Female Households. The Census Bureau uses a federally defined poverty threshold that remains constant throughout the country and does not correspond to Area Median Income.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-43
Seniors
Senior households often experience a combination of factors that can make accessing or keeping affordable housing a challenge. They often live on fixed incomes and are more likely to have disabilities, chronic health conditions, and/or reduced mobility. Seniors who rent may be at even greater risk for housing challenges than those who own, due to income differences between these groups.

In the Town of Los Gatos, the largest proportion of senior households who rent fell into one of the categories below the Greater than 100% AMI category, while the largest proportion of senior households who are homeowners fell in the Greater than 100% AMI category. Figure B-39 shows senior households by income and tenure.

Figure B-39 Senior Households by Income and Tenure, Los Gatos SOURCE: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) ACS tabulation, 2012-2017 release. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table SEN-01.

NOTES: Universe: Senior households. For the purposes of this graph, senior households are those with a householder who is aged 62 or older. Income groups are based on HUD calculations for Area Median Income (AMI). HUD calculates the AMI for different metropolitan areas, and the nine county Bay Area includes the following metropolitan areas: Napa Metro Area (Napa County), Oakland-Fremont Metro Area (Alameda and Contra Costa Counties), San Francisco Metro Area (Marin, San Francisco, and San Mateo Counties), San Jose Sunnyvale-Santa Clara Metro Area (Santa Clara County), Santa Rosa Metro Area (Sonoma County), and Vallejo-Fairfield Metro Area (Solano County). The AMI levels in this chart are based on the HUD metro area where this jurisdiction is located.

People with Disabilities
People with disabilities face additional housing challenges. Encompassing a broad group of individuals living with a variety of physical, cognitive, and sensory impairments, many people with disabilities live on fixed incomes and are in need of specialized care, yet often rely on family members for assistance due to the high cost of care.

When it comes to housing, people with disabilities are not only in need of affordable housing, but accessibly designed housing, which offers greater mobility and opportunity for independence. Unfortunately, the need typically outweighs what is available, particularly in a housing market with such high demand. People with disabilities are at a high risk for housing insecurity, homelessness, and institutionalization, particularly when they lose aging caregivers.

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B-44 Appendix B October 2022
Overall, 9 percent of people in Los Gatos have a disability of some kind. 20F 21 Figure B-40 shows the rates at which
different disabilities are present among residents of Los Gatos.

Figure B-40 Disability by Type, Los Gatos
SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B18102, Table B18103, Table B18104, Table B18105, Table B18106, Table B18107. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table DISAB-01.

NOTES: Universe: Civilian noninstitutionalized population 18 years and over. These disabilities are counted separately and are not mutually exclusive, as an individual may report more than one disability. These counts should not be summed. The Census Bureau provides the following definitions for these disability types: Hearing difficulty: deaf or has serious difficulty hearing. Vision difficulty: blind or has serious difficulty seeing even with glasses. Cognitive difficulty: has serious difficulty concentrating, remembering, or making decisions. Ambulatory difficulty: has serious difficulty walking or climbing stairs. Self-care difficulty: has difficulty dressing or bathing.

Independent living difficulty: has difficulty doing errands alone such as visiting a doctor’s office or shopping.

State law also requires a Housing Element to examine the housing needs of people with developmental disabilities. Developmental disabilities are defined as severe, chronic, and attributed to a mental or physical impairment that begins before a person turns 18 years old. This can include Down’s Syndrome, autism, epilepsy, cerebral palsy, and mild to severe intellectual disability. Some people with developmental disabilities are unable to work, rely on supplemental security income, and live with family members. In addition to their specific housing needs, they are at increased risk of housing insecurity after an aging parent or family member is no longer able to care for them21F
22 .

In the Town of Los Gatos, there are 50 children under the age of 18 with a developmental disability (40.7 percent), while there are 73 adults with a developmental disability (60 percent). Table B-4 below shows the number of persons in Los Gatos with developmental disabilities by age. 21 These disabilities are counted separately and are not mutually exclusive, as an individual may report more than one disability. These counts should not be summed.
22 For more information or data on developmental disabilities in your jurisdiction, contact the Golden Gate Regional Center for Marin, San Francisco and San Mateo Counties; the North Bay Regional Center for Napa, Solano and Sonoma Counties; the Regional Center for the East Bay for Alameda and Contra Costa Counties; or the San Andreas Regional Center for Santa Clara County.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-45
Table B-4 Los Gatos Population with Developmental Disabilities by Age Age Group Number
Age Under 18 50
Age 18+ 73
SOURCE: California Department of Developmental Services, Consumer Count by California ZIP Code and Age Group (2020). This table is included in the Data Packet Workbook as Table DISAB-04.

NOTE: Universe: Population with developmental disabilities. Notes: The California Department of Developmental Services is responsible for overseeing the coordination and delivery of services to more than 330,000 Californians with developmental disabilities including cerebral palsy, intellectual disability, Down syndrome, autism, epilepsy, and related conditions. The California Department of Developmental Services provides ZIP code level counts. To get jurisdiction-level estimates, ZIP code counts were cross walked to jurisdictions using census block population counts from Census 2010 SF1 to determine the share of a ZIP code to assign to a given jurisdiction.

The most common living arrangement for individuals with disabilities is in Los Gatos is the home of parent/family/guardian. Table B-5 shows the Los Gatos population with developmental disabilities by residence.

Table B-5 Los Gatos Population with Developmental Disabilities by Residence Residence Type Number
Home of Parent/Family/Guardian 102
Foster/Family Home 9
Independent/Supported Living 7
Other 4
Community Care Facility 4
Intermediate Care Facility 0
SOURCE: California Department of Developmental Services, Consumer Count by California ZIP Code and Residence Type (2020). This table is included in the Data Packet Workbook as Table DISAB-05.

NOTE: Universe: Population with developmental disabilities. Notes: The California Department of Developmental Services is responsible for overseeing the coordination and delivery of services to more than 330,000 Californians with developmental disabilities including cerebral palsy, intellectual disability, Down syndrome, autism, epilepsy, and related conditions. The California Department of Developmental Services provides ZIP code level counts. To get jurisdiction-level estimates, ZIP code counts were cross walked to jurisdictions using census block population counts from Census 2010 SF1 to determine the share of a ZIP code to assign to a given jurisdiction.

Homelessness
Homelessness remains an urgent challenge in many communities across the State, reflecting a range of social, economic, and psychological factors. Rising housing costs result in increased risks of community members experiencing homelessness. Many residents have found themselves housing insecure and ended up homeless in recent years, either temporarily or longer term. Addressing the specific housing needs for the unhoused population remains a priority throughout the region, particularly since homelessness is disproportionately experienced by people of color, people with disabilities, those struggling with addiction, and those dealing with traumatic life circumstances.

In Santa Clara County, the most common type of household experiencing homelessness are those without children in their care. Among households experiencing homelessness that do not have children, 87 percent are unsheltered. Of homeless households with children, most are sheltered in an emergency shelter. Figure B-41 shows household type and shelter status in Santa Clara County.

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Figure B-41 Homelessness by Household Type and Shelter Status, Santa Clara County SOURCE: U.S. Department of Housing and Urban Development (HUD), Continuum of Care (CoC) Homeless Populations and Subpopulations Reports (2019). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HOMELS-01.

NOTES: Universe: Population experiencing homelessness. This data is based on Point-in-Time (PIT) information provided to HUD by CoCs in the application for CoC Homeless Assistance Programs. The PIT Count provides a count of sheltered and unsheltered homeless persons on a single night during the last ten days in January. Each Bay Area county is its own CoC, and so the data for this table is provided at the county-level. Per HCD’s requirements, jurisdictions will need to supplement this county-level data with local estimates of people experiencing homelessness.

People of color are more likely to experience poverty and financial instability as a result of federal and local housing policies that have historically excluded them from the same opportunities extended to White residents. Consequently, people of color are often disproportionately impacted by homelessness, particularly Black residents of the Bay Area.

In Santa Clara County, White (Hispanic and Non-Hispanic) residents represent the largest proportion of residents experiencing homelessness and account for 44 percent of the homeless population, while making up 45 percent of the overall population. Figure B-42 shows the racial group share of the homeless population.

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October 2022 Appendix B B-47
Figure B-42 Racial Group Share of General and Homeless Populations, Santa Clara County SOURCE: U.S. Department of Housing and Urban Development (HUD), Continuum of Care (CoC) Homeless Populations and Subpopulations Reports (2019); U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B01001(A-I). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HOMELS-02.

NOTES: Universe: Population experiencing homelessness. This data is based on Point-in-Time (PIT) information provided to HUD by CoCs in the application for CoC Homeless Assistance Programs. The PIT Count provides a count of sheltered and unsheltered homeless persons on a single night during the last ten days in January. Each Bay Area county is its own CoC, and so the data for this table is provided at the county-level. Per HCD’s requirements, jurisdictions will need to supplement this county-level data with local estimates of people experiencing homelessness. HUD does not disaggregate racial demographic data by Hispanic/Latinx ethnicity for people experiencing homelessness. Instead, HUD reports data on Hispanic/Latinx ethnicity for people experiencing homelessness in a separate table.

Accordingly, the racial group data listed here includes both Hispanic/Latinx and non-Hispanic/Latinx individuals.

In Santa Clara County, Latinx residents represent 42.7 percent of the population experiencing homelessness, while Latinx residents comprise 25.8 percent of the general population. Figure B-43 shows the Latinx share of the homeless population in Santa Clara County.

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Figure B-43 Latinx Share of General and Homeless Populations, Santa Clara County SOURCE: U.S. Department of Housing and Urban Development (HUD), Continuum of Care (CoC) Homeless Populations and Subpopulations Reports (2019); U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B01001(A-I). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HOMELS-03.

NOTES: Universe: Population experiencing homelessness. This data is based on Point-in-Time (PIT) information provided to HUD by CoCs in the application for CoC Homeless Assistance Programs. The PIT Count provides a count of sheltered and unsheltered homeless persons on a single night during the last ten days in January. Each Bay Area county is its own CoC, and so the data for this table is provided at the county-level. Per HCD’s requirements, jurisdictions will need to supplement this county-level data with local estimates of people experiencing homelessness. The data from HUD on Hispanic/Latinx ethnicity for individuals experiencing homelessness does not specify racial group identity. Accordingly, individuals in either ethnic group identity category (Hispanic/Latinx or non-Hispanic/Latinx) could be of any racial background.

Many of those experiencing homelessness are dealing with severe issues, including mental illness, substance abuse, and domestic violence, which are potentially life threatening and require additional assistance.

In Santa Clara County, homeless individuals are commonly challenged by severe mental illness, with 2,659 reporting this condition. Of those, some 87.6 percent are unsheltered, further adding to the challenge of handling the issue. Figure B-44 shows selected characteristics of the homeless population in Santa Clara County.

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October 2022 Appendix B B-49
Figure B-44 Characteristics for the Population Experiencing Homelessness, Santa Clara County SOURCE: U.S. Department of Housing and Urban Development (HUD), Continuum of Care (CoC) Homeless Populations and Subpopulations Reports (2019). Data from ABAG/MTC Housing Needs Data Packet Workbook, Table HOMELS-04.

NOTES: Universe: Population experiencing homelessness. This data is based on Point-in-Time (PIT) information provided to HUD by CoCs in the application for CoC Homeless Assistance Programs. The PIT Count provides a count of sheltered and unsheltered homeless persons on a single night during the last ten days in January. Each Bay Area county is its own CoC, and so the data for this table is provided at the county-level. Per HCD’s requirements, jurisdictions will need to supplement this county-level data with local estimates of people experiencing homelessness. These challenges/characteristics are counted separately and are not mutually exclusive, as an individual may report more than one challenge/characteristic. These counts should not be summed.

In the Town of Los Gatos, there were no reported students experiencing homeless in the 2019-20 school year.

By comparison, Santa Clara County has seen a 3.5 percent increase in the population of students experiencing homelessness since the 2016-17 school year, and the Bay Area population of students experiencing homelessness decreased by 8.5 percent. During the 2019-2020 school year, there were still some 13,718 students experiencing homelessness throughout the region, adding undue burdens on learning and thriving, with the potential for longer term negative effects. Table B-6 summarizes students in public schools experiencing homelessness.

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Table B-6 Students in Local Public Schools Experiencing Homelessness Academic Year Los Gatos Santa Clara County Bay Area
2016-17 0 2,219 14,990
2017-18 0 2,189 15,142
2018-19 0 2,405 15,427
2019-20 0 2,297 13,718
SOURCE: California Department of Education, California Longitudinal Pupil Achievement Data System (CALPADS), Cumulative Enrollment Data (Academic Years 2016-2017, 2017-2018, 2018-2019, 2019-2020). This table is included in the Data Packet Workbook as Table HOMELS-05.

NOTE: Universe: Total number of unduplicated primary and short-term enrollments within the academic year (July 1 to June 30), public schools. The California Department of Education considers students to be homeless if they are unsheltered, living in temporary shelters for people experiencing homelessness, living in hotels/motels, or temporarily doubled up and sharing the housing of other persons due to the loss of housing or economic hardship. The data used for this table was obtained at the school site level, matched to a file containing school locations, geocoded and assigned to jurisdiction, and finally summarized by geography.

Farmworkers
Across the State, housing for farmworkers has been recognized as an important and unique concern.

Farmworkers generally receive wages that are considerably lower than other jobs and may have temporary housing needs. Finding affordable housing can be challenging, particularly in the current housing market.

In the Town of Los Gatos, there were no reported students of migrant workers in the 2019-20 school year. The trend for the region for the past few years has been a decline of 2 percent in the number of migrant worker students since the 2016-17 school year. The change at the county level is a 50 percent decrease in the number of migrant worker students since the 2016-17 school year. Table B-7 summarizes migrant worker student population in the Town of Los Gatos, Santa Clara County, and the Bay Area as a whole.

Table B-7 Migrant Worker Student Population
Academic Year Los Gatos Santa Clara County Bay Area
2016-17 0 978 4,630
2017-18 0 732 4,607
2018-19 0 645 4,075
2019-20 0 492 3,976
SOURCE: California Department of Education, California Longitudinal Pupil Achievement Data System (CALPADS), Cumulative Enrollment Data (Academic Years 2016-2017, 2017-2018, 2018-2019, 2019-2020). This table is included in the Data Packet Workbook as Table FARM

01. NOTES: Universe: Total number of unduplicated primary and short-term enrollments within the academic year (July 1 to June 30), public schools. The data used for this table was obtained at the school site level, matched to a file containing school locations, geocoded and assigned to jurisdiction, and finally summarized by geography.

According to the U.S. Department of Agriculture Census of Farmworkers, the number of permanent farm workers in Santa Clara County has increased since 2002, totaling 2,418 in 2017, while the number of seasonal farm workers has decreased, totaling 1,757 in 2017. Figure B-45 shows farm operation and labor in Santa Clara County.

Appendix B. Housing Needs Assessment
October 2022 Appendix B B-51
Figure B-45 Farm Operations and Farm Labor by County, Santa Clara County SOURCE: U.S. Department of Agriculture, Census of Farmworkers (2002, 2007, 2012, 2017), Table 7: Hired Farm Labor. For the data table behind this figure, please refer to the Data Packet Workbook, Table FARM-02.

NOTES: Universe: Hired farm workers (including direct hires and agricultural service workers who are often hired through labor contractors). Farm workers are considered seasonal if they work on a farm less than 150 days in a year, while farm workers who work on a farm more than 150 days are considered to be permanent workers for that farm.

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Non-English Speakers
California has long been an immigration gateway to the United States, which means that many languages are spoken throughout the Bay Area. Since learning a new language is universally challenging, it is not uncommon for residents who have immigrated to the United States to have limited English proficiency. This limitation can lead to additional disparities if there is a disruption in housing, such as an eviction, because residents might not be aware of their rights or they might be wary to engage due to immigration status concerns.

In the Town of Los Gatos, 1.7 percent of residents five years and older identified as speaking English not well or not at all, which was below the proportion for Santa Clara County. Throughout the region the proportion of residents five years and older with limited English proficiency was eight percent. Figure B-46 shows population with limited English proficiency in the Town of Los Gatos, Santa Clara County, and the Bay Area as a whole.

Figure B-46 Population with Limited English Proficiency SOURCE: U.S. Census Bureau, American Community Survey 5-Year Data (2015-2019), Table B16005. Data from ABAG/MTC Housing Needs Data Packet Workbook, Table AFFH-03.

NOTE: Universe: Population 5 years and over.

Santa Clara County has approximately 23 emergency shelters, providing close to 800 beds year-round, with an additional 300 beds available during the winter months (November through March). There are also over 1,100 transitional housing beds throughout the County that offer a combination of stable housing and intensive, targeted support services for the mentally ill, those with chronic substance abuse, developmental disabilities, and other factors that prevent the homeless from returning to permanent housing situations. Transitional housing includes both single site and "scattered site" programs. Table B-8 below provides a summary of homeless facilities, emergency shelters and transitional housing near the Town of Los Gatos.

1.7%

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Table B-8 Homeless Facilities Near Los Gatos
Facility Beds Target Population Location
Emergency Shelters
Asian Americans for Community
Involvement 12 Women with Children San Jose
City Team Rescue Mission 52 Single men San Jose
Hospitality House, Salvation Army 24 Single men San Jose Our House Youth Services HomeFirst 10 Homeless and run-away youth San Jose San Jose Family Shelter 143 Families San Jose
Support Network for Battered Women 18 Domestic violence shelter- women and children San Jose
Emergency Shelter/Transitional Housing
InnVision 178 Working men, women & children, mentally
ill men & women San Jose
James Boccardo Reception Center 370 Families and single adults San Jose Transitional Housing
Next Door- Women with Children 19 Domestic Violence Shelter -Women and children San Jose
St. Josephs Cathedral 45 Worker housing- men, women and children San Jose YWCA- Villa Nueva 126 Women and children San Jose
SOURCE: Santa Clara County Consolidated Plan, 2010-2015

Governmental and Non-Governmental Constraints C

APPENDIX

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-1
C.1 Governmental Constraints
Potential governmental constraints that impact housing development in Los Gatos include land use and zoning regulations, building code standards and code compliance, Town design and development standards, governmental fees and exactions, processing and permitting time, and local housing programs.

This appendix provides a full discussion of both governmental and non-governmental constraints that affect housing in Los Gatos. Governmental constraints are policies, requirements, or other actions imposed by various levels of government on land and housing ownership and development. Federal and State agency regulations that may constrain development are beyond the control of the Town and are therefore not addressed in this document. Non-governmental constraints are other conditions that impact housing development such as market factors, environmental setting, and construction costs.

Land Use
On June 30, 2022, the Town Council adopted the 2040 General Plan and accompanying Environmental Impact Report (EIR). As of September 27, 2022, The Land Use and Community Design Elements of the 2040 General Plan are suspended pending the results of a referendum. In the interim, the Town’s 2020 General Plan Land Use and Community Design Elements will govern during the suspension period.

Residential Designations
 HR, Hillside Residential. The purpose of this designation very low density single-family residential and accessory dwelling unit development on large lots or as part of a cluster development. This designation allows for development that is compatible with the unique mountainous terrain and rural nature of the hillside areas. Up to one dwelling unit per acre and maximum height of 25 feet.  LDR, Low Density Residential. The purpose of this designation is to provide for accessory dwelling units and single-family residential purposes. It encourages single-family residential development in either the standard development established by standard zoning or by innovative forms obtained through a planned development. Densities range from 0 to five dwelling units per acre, a maximum height of 30 feet and up to 40 percent lot coverage.
 MDR, Medium Density Residential. The purpose of this designation is to provide for accessory dwelling units, multi-family residential, duplexes, and/or small lot single-family homes. Mixed-use developments are not permitted in this designation. Densities range from five to 12 units per acre, maximum height up to 30 feet or 35 feet when the building has below grade parking and lot coverage up to 40 percent.  HDR, High Density Residential. The purpose of this designation is to provide for accessory dwelling units, and more dense multi-family residential development. Its objective is to provide quality housing in proximity to transit and/or commercial and business areas. Mixed-use developments are not permitted in this designation. Densities range from 12 to 20 units per acre, maximum height up to 30 feet or 35 feet when the building has below grade parking and lot coverage up to 40 percent.

Commercial Designations
 MU, Mixed-Use. The purpose of this designation is to provide a mixture of commercial uses (including retail, office, hotel/lodging) and residential, along with allowing stand-alone commercial uses (including retail, office, hotel/lodging, service uses, recreational uses, and restaurants). Residential is only allowed when developed in a mixed-use format with retail, office, or hotel/lodging components on the site. Projects developed under this designation shall maintain primary orientation to arterial street frontages and proper transitions and buffers to adjacent residential properties. Densities range up to 20 units per acre, with a maximum height up to 35 feet, and lot coverage up to 50 percent.

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 NC, Neighborhood Commercial. The purpose of this designation is to provide for necessary day-to-day commercial goods and services required by the residents of the adjacent neighborhoods. This designation encourages concentrated and coordinated commercial development at easily accessible locations.

Residential uses, developed using a mixed-use format, are allowed in the designation. Densities range up to 20 units per acre, with a maximum height up to 35 feet, and lot coverage up to 50 percent.  CDB, Central Business District. The purpose of this designation is to encourage a mixture of communityorientated commercial goods and services within the Downtown CBD. This designation applies exclusively to the Downtown CBD, with the goal to accommodate and retain local merchants and preserve the Town’s character. New development in the CBD shall integrate with existing structures of architectural and historical significance. Residential uses, developed using a mixed-use format, are allowed in the designation. Densities range up to 20 units per acre, maximum height up to 45 feet and a FAR up to 2.0.

Employment Center Designations
 OP, Office Professional. The purpose of this designation is to provide for professional and general business offices, incubator spaces, and innovation centers. This designation applies to various locations throughout the Town, often in proximity to neighborhood- or community-oriented commercial facilities, or as a buffer between commercial and residential uses. The intent of this designation is to satisfy the community’s need for general business and professional services, and local employment. Residential uses, developed using a mixed-use format, are allowed in the designation. Densities range up to 20 units per acre, with a maximum height up to 35 feet and lot coverage up to 50 percent.

Specific Plan Designations
 NF-SP, North Forty Specific Plan. The purpose of this designation is to provide land for the North 40 Specific Plan, which includes the designation of mixed-use development (residential and commercial, open space amenities, and space for a hotel).

Town Code
The Town of Los Gatos Municipal Code provides zoning regulations that are more specific than the General Plan Land Use designations. This section describes residential development standards, including accessory dwelling units, overlay zones, and density bonuses. This section also analyzes constraints on housing for persons with disabilities.

Residential Development Standards
There are seven residential and five commercial zoning districts in Los Gatos that allow residential uses. Table C-1 provides the regulations for each zone.
 Resource Conservation (RC)
 Hillside Residential (HR)
 Single-Family Residential (R-1)
 Single-Family Residential Downtown (R-1 D)
 Duplex Residential (RD)
 Multi-family Residential (RM)
 Neighborhood Commercial (C-1)
 Central Business District (C-2)
 Highway Commercial (CH)
 Office (O)

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-3
 Commercial Industrial Zone (LM)
As shown in Table C-1, development standards for each residential district could impede a project’s ability to develop housing at a density of at least 35 dwelling units per acre on a site. The 30-foot height limit for the majority of residential designations allows for up to three building stories and the maximum density of 20 dwelling units per acre in the RM zone limits development.

Table C-1 also provides the parking requirements for residential development in Los Gatos, by zoning district.

Parking is often a significant component of the cost of residential development and can be viewed as a constraint to the provision of housing. The Town has provided some flexibility in its parking requirements, particularly for Planned Developments and for some developments providing affordable units for elderly and disabled persons, generally easing the constraint of parking requirements on the development of higher density and affordable units.

As part of the Housing Element Update, programs to amend the Zoning Code and General Plan to ensure adequate sites are available to accommodate the identified sites in the Sites Inventory are proposed and include  Amending the Zoning Code to include a Housing Element Overlay Zone (HEOZ) to apply to the sites included in the Site Inventory to modify the development standards (i.e., density, lot coverage, floor area ratio, height) on those sites;
 Amending the Affordable Housing Overlay Zone to increase the maximum allowable density from 20 dwelling units per acre to 30 dwelling units per acre;
 Amending the North Forty Specific Plan to increase the maximum allowable density from 20 dwelling units per acre to more than 30 dwelling units per acre and increase the total number of dwelling units allowed in the Specific Plan;
 Clarifying the text of the non-residential zones that the housing sites contained in the inventory sites table that are in these zones must include housing;
 Rezoning the Caltrans ROW (Site E3) to allow for residential development; and  Allowing for housing developments that are 100 percent affordable are allowed by-right in Mixed-Use General Plan designation.

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Table C-1 Residential and Commercial Development Standards by Zoning District Notes: a Single-family, residential condominiums, and two-family dwellings must provide two parking spaces for each living unit and one additional visitor space for each residential unit is required. See discussion below for information regarding required visitor spaces. b The Town requires 1.5 parking spaces per unit for multiple-unit dwellings in all zones and two-family dwellings in the R-1D zone. One visitor parking space for each residential unit other than a detached single-family or two-family dwelling shall be required, unless the Planning Commission makes a finding that more or less visitor parking is necessary due to the size or type of housing unit(s). c Setbacks vary depending on adjacent uses and streets for commercial designations Zoning
District Density Minimum Lot
Area
Maximum
Height
(Feet)
Front
Yard
Setback
(Feet)
Side
Yard
Setback
(Feet)
Rear
Yard
Setback
(Feet)
Parking
Per Unit
(No. of
Spaces)
Other
RC 1 unit per lot 20 acres 25 30 20 25 2
HR HR-1: 1-5 acres per unit
HR-2.5: 2.5-10 acres per unit
HR-5: 5-40 acres per unit
HR-20: 20-160 acres per unit
40,000 sq. ft. 25 30 20 25 2 Density ranges are dependent on hillside slope calculations.

R-1 R-1:8 8,000 sq. ft. 30 25 8 20 2
R-1:10 10,000 sq. ft. 30 25 10 20 2
R-1:12 12,000 sq. ft. 30 25 10 20 2
R-1:15 15,000 sq. ft. 30 25 12 25 2
R-1:20 20,000 sq. ft. 30 30 15 25 2
R-1:30 30,000 sq. ft. 30 30 16 25 2
R-1D 5,000 sq. ft. for
single-family
8,000 sq. ft. for
duplex
30 15 5 20
2 for singlefamily and
two-family
dwellings
Architecture & Site is required
for all new primary buildings
R-D 8,000 sq. ft. 30 25 8 20 2
R-M
8,000 sq. ft. 30 25 8-10 20
Resident: 1.5
per unit a
Visitor: 1 per
unit b
Maximum height is 30 feet,
except when the building has
below grade parking the
maximum is 35 feet.

C-1 Up to20 units per acre N/A 35 15 0 0 c Dependent
on unit size Residential allowed with CUP
C-2 Up to 20 units per acre N/A 45 15 c 0 c 0 c Residential allowed with CUP.

CH Up to 20 units per acre N/A 35 25 c 15 c 20 c Residential allowed with CUP O Up to 20 units per acre 8,000 sq. ft. 35 25 10 20 Residential allowed with CUP LM Up to 20 units per acre 8,000 sq. ft. 35 15 c 0 c 0 c Live/work allowed with CUP

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-5
Overlay Zones
Four overlay zones in the Town Code, the Planned Development (PD) zone, the Landmark and Historic Preservation (LHP) zone, the Affordable Housing Overlay Zone (AHOZ), and the Public School Zone (PS) that apply to housing development in Los Gatos.

Planned Development (PD)
The PD overlay zone was updated in 2018 and is intended to preserve, enhance, and/or promote development that highlights the Town’s characteristics. This includes natural and historic resources, production of affordable housing, maximization of open space, and projects that provide a public benefit to the Town’s citizens. As an incentive to housing development, the PD overlay provides alternative standards for housing developments with a minimum of 40 percent of the units affordable to households of very low, low, or moderate income.

Landmark and Historic Preservation (LHP)
The LHP overlay zone designation is applied to individual sites, structures, or areas deemed as architecturally or historically significant. There are five designated LHP overlay zones within the Town, including the Almond Grove, Downtown Commercial, Fairview Plaza, and University-Edelen districts. Existing and proposed structure(s) within these LHP overlay zones are subject to a special design standard and review process regarding their appearance, use, and maintenance before the Historic Preservation Committee.

Affordable Housing Overlay Zone (AHOZ)
The AHOZ is intended to increase the supply and variety of housing types to promote tenure and affordability.

The AHOZ promotes densities, development standards and incentives that will encourage the production of housing affordable to all income levels of the Town's RHNA allocation. The properties can be developed consistent with the AHOZ development standards, densities and incentives or under the existing zoning requirements, but not both. The 2023-2031 Housing Element lists the one property, the Southbay Development located on Knowles Drive, east of Winchester Boulevard as a key housing opportunity site for a mixed income affordable housing project. The designation of this site will assist the Town in meeting its fair share of the regions housing needs required by the State.

The AHOZ permits development at a density of 20 units per acre by-right, with an Architecture and Site approval, for projects in which at least half of the units are affordable to lower or moderate-income households. The AHOZ provides a 30-foot building height with an automatic allowance for 35 feet for integrated (first floor) garage or podium parking. Additional height can be granted through the Architecture and Site Plan review process. The 40 percent lot coverage and parking reduction is consistent with the State Density Bonus maximum parking requirements. Further parking reductions are allowed for properties within a quarter mile of the planned Vasona Light Rail Station, for senior-only housing and housing for persons with disabilities. All other property development standards are consistent with the Town's R-M Standards.

The AHOZ also allows up to four automatic concessions. The concessions include reductions in:
 Parking: one space for studio and one-bedroom units, two spaces for three-to-four-bedroom units, 2.5 spaces for four or more-bedroom units, one space for units reserved for seniors or persons with disabilities, reduction to one space per unit for developments within one-quarter mile to the proposed Vasona Light Rail Station.
 Setbacks: Any two property setbacks may be reduced by up to 50 percent.  Increase in lot coverage: The lot coverage may be increased up to 50 percent from 40 percent.  Processing fees: The Town shall waive or defer planning, engineering, and building processing fees, except those that are paid directly to Town consultants or for technical studies.

The developer can select one of the following types of fees to be waived as one of the four available concessions:
a. Planning and engineering application fees (but not Town consultant fees). b. Building plan check and inspection fees.
c. Construction mitigation fee.

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 Priority processing: The Town gives projects the highest processing priority for planning entitlements, building plan check and building inspections.

The Valley Transportation Authority has deferred the development of the Vasona Light Rail Station indefinitely.

Given this recent development, the Town will initiate a Code amendment to reduce parking within a quarter mile of transit stops as a further development incentive in the AHOZ.

Public School Zone (PS)
The PS Overlay Zone is intended to all school buildings to be used for community and educational purposes, such as museums, community centers, and nurseries, without extensive exterior modifications. Any land owned by a public school district may be designated as a PS overlay zone.

Multi-family Housing
Multi-family housing is permitted in a residential zone, including the R-M zone and is permitted in a mixed-use development with a Conditional Use Permit (CUP) in the following commercial zoning districts, C-1, C-2, and CH zones. One of the intents of these districts is to direct and facilitate housing of various density ranges. A permitting process that is more onerous or uncertain for multi-family units than for single-family presents a concern and could be considered a constraint on multi-family housing. In the R-M zone, the Town requires apartments include one and a half parking spaces per unit, regardless of the number of bedrooms in the unit, plus one visitor parking space for each apartment unit, unless the Planning Commission makes a finding that more or fewer visitor parking is necessary due to the size or type of housing unit(s).

A CUP can increase risk and costs associate with the planning entitlement process act as a deterrent to housing developers. Long permit processing times or permit processes that have a high degree of uncertainty (i.e., discretionary reviews or processes with multiple public meetings) increase the cost of housing for developers, either by increasing their carrying costs as they wait for permits, or by increasing the chance that a project will be rejected after a long wait. In either case, a developer working in a jurisdiction with an onerous permitting process will demand higher profits to account for the increased risk, thereby increasing the overall development costs. In order to remove this regulatory constraint, the Housing Element includes an Implementation Program to remove the requirement for a CUP for residential development in zoning districts that current allow multi-family uses with a CUP.

In Los Gatos, the predominant housing type in the Town is single family development which are allowed by right in the R-M zone. When single family residences are allowed in higher density residential zoning districts, the likelihood and ability of a developer constructing higher density residential units is diminished. Housing developers face higher risk, including neighborhood opposition, when single-family homes are present in multifamily zoning districts.

Manufactured Housing
Manufactured, otherwise known as prefabricated or factory-built, housing is constructed off-site and then transported to the property. It is allowed in all residential districts in Los Gatos subject to its compliance with Town regulations.

Transitional and Supportive Housing
According to California Health and Safety Code Section 50675.2, transitional housing is rental housing with, at most, a six-month limit on the length of stay for tenants. Transitional housing would be available to homeless individuals and/or families in need of temporary housing until they can secure more permanent housing. The Town of Los Gatos Zoning Code uses the State’s definitions for transitional housing. Transitional housing is permitted as a residential use consistent with State law.

According to California Health and Safety Code Section 50675.14, supportive housing is housing that is linked to on- or off-site services and is occupied by low-income persons with mental disabilities, chronic health issues or substance abuse issues or persons with disabilities that were developed before age 18. Supportive housing has no limit on the length of stay for tenants. Supportive housing in Los Gatos consists of small family home

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-7
residential care facilities, which are permitted in all residential zoning districts except Mobile Home Residential (RMH). In Los Gatos, licensed residential care facilities for six or less persons are allowed by right in all residential districts consistent with California Health and Safety Code Section 1267.8.

Accessory Dwelling Unit (ADU)
Accessory dwelling units are complete independent housing units that can be either detached or attached from an existing single-family residence. Based on their relatively small size, and because they do not require paying for land or major new infrastructure, ADUs are considered affordable by design. ADUs can provide affordable housing options for family members, seniors, students, in-home health care providers, and other small household types. ADUs can also be useful to generate additional rental income for the homeowner, making homeownership more financially feasible.

In 2020 the Town adopted Ordinance 2307, amending the Town Code to further address barriers to the development of ADUs and to conform with a series of State bills aimed at encouraging single-family homeowners to add ADUs to their property. Permitted zones allowing the ADUs include the R-1, R-D, R-M, R-1D, RMH, HR and RC zones. The Town’s ADU Ordinance allows a 10 percent increase in the floor area ratio standards for an ADU. All detached units must comply with lot coverage maximum of their designated zone. ADUs are not to exceed 1,200 square feet. One parking space is required per unit or bedroom, unless the ADU is located within half a mile of a transit stop.

A new ADU requires the submittal of an Accessory Dwelling Unit Application to the Community Development Department. Over the past three years, the Town has averaged 50 ADUs per year. In order to further incentivize production, a program to eliminate Building fees if the unit is deed restricted for very low- and low-income households is included in the Housing Element.

Building and Code Compliance
In addition to the General Plan land use designations and Town Code, Los Gatos has recently adopted updated building codes that enforce Town regulations with the purpose of protecting the lives, health, property, and public welfare of Los Gatos residents. Each Code is an enforcement of State and local standards and is not considered a constraint on housing production in Los Gatos. The following 2019 California Building Standards Codes have been adopted, as amended by the Town:
 Part 1 California Administrative Code.
 Part 2 California Building Code, Volumes 1 and 2, including Appendices B, I, and J.  Part 2.5 California Residential Code including Appendices H, K, O, Q, S, V, and X.  Part 3 California Electrical Code.
 Part 4 California Mechanical Code.
 Part 5 California Plumbing Code including Appendices A, B, D, G, I, K, and L.  Part 6 California Energy Code.
 Part 8 California Historical Building Code including Appendices A.  Part 9 California Fire Code.
 Part 10 California Existing Building Code including 20118 International Existing Building Code Chapters 9 and 14, as well as Appendices A2, A3, A4, and A5.
 Part 11 California Green Building Standards Code (CALGreen) Chapters 1 through8 only.  Part 12 California Referenced Standards Code.
 2018 International Property Maintenance Code.

The Town also has a Code Compliance Officer that enforces the Town’s zoning regulations and building and safety codes. The program reviews and responds to code complaints. The Town has adopted the 2018

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International Code for Property Maintenance and the 2019 California Existing Building Code, including 2018 International Existing Building Code Chapters 9, 14, and Appendices A2, A3, A4, and A5. Affordable units developed under the Below Market Price (BMP) Program must undergo an annual compliance audit.

On- and Off-Site Improvements
The Town requires standard on- and off-site improvements for development, which are intended to meet health and safety requirements of the community. These standard improvements are not considered a constraint on development because the Town does not include improvements beyond what is required to meet health and safety requirements. Subdivision design standards for the Town, described in the Town Code starting at Section

29.10.06701, include the following on- and off-site improvements:
 Parking bays may be required on narrow streets where parking may be prohibited on either or both sides of the street.
 Roadways must be paved with asphalt concrete.
 Sidewalks are required on all streets in a subdivision unless the lots will be 20,000 feet in size or more.  Curbs and gutters must be constructed on all streets.  Culverts, storm drains, and drainage structures will be required in a subdivision.  Sanitary sewers with house service laterals are required to serve each lot, with some exceptions in hillside areas.
 Underground utilities with connections are required for each lot.  Street lighting shall be installed in accordance with Town standards Design Guidelines and Objective Design Standards
The Town has adopted Residential Design Guidelines for single-family and two-family dwelling units, which incorporate the Town’s previous Residential Pre-1941 Design Guidelines for historically significant structures, sites, and historic districts in Los Gatos. The Town has also adopted Hillside Development Standards and Guidelines. These sets of development standards and design guidelines are used in the development and design review process for Los Gatos and complement the Town’s zoning regulations. The Hillside Development Standards and Guidelines were adopted in January 2004 and modified in 2020. The Residential Design Guidelines were updated and adopted in 2008.

The Town of Los Gatos is developing Objective Design Standards for the review of multi-family housing and mixed-use development applications. This effort is in response to State legislation requiring jurisdictions to adopt objective standards and to implement them in a streamlined review of qualifying housing projects. Objective standards are defined under State law as “standards that involve no personal or subjective judgement by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official prior to submittal” (California Government Code, Section 65913.4).

On September 14, 2022, the Planning Commission reviewed and recommended approval of the Draft Objective Design Standards with modifications. The Town Council is expected to consider the Draft Objective Design Standards in mid-November 2022.

Residential Design Guidelines
Residential Design Guidelines in Los Gatos address the following design characteristics for single-family and twofamily dwelling units in all zoning districts except for the RC and HR zones:
 Historic Designations. When necessitated by the designating ordinance, Historic Preservation Committee review of a development is required for developments that affect a historically designated property or are located in a historic district.

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-9
 Site Development. This section focuses on the design and layout of the housing development in relation to its site. Site planning issues addressed include site design, solar orientation, shadow effect, and easements and dedications. This section provides information on landscaping requirements, sensitivity to adjacent neighbors, and conformity to neighborhood street and sidewalk edges.  Building Design. This section focuses on the design and layout of development in relation to the surrounding neighborhood. Issues addressed include harmony and compatibility with the streetscape and surrounding structures; the scale and mass of the development including second-story additions, significant remodels, demolitions and replacement structures, exterior material and colors, building components, energy conservation, and privacy. Neighborhood compatibility for replacement structures shall be based on the following criteria:
 Existing architectural style of surrounding neighborhood.  Size of the lot on which the development is located.
 Size of homes adjacent to the development and along the street on which the development is located.
 Transitioning neighborhood.
 Impacts on the site and surrounding property.
 Landscaping/Open Space. This section addresses tree preservation in accordance with Division 2 of the Town Code for adherence to the Town’s Tree Protection Ordinance.

The Los Gatos Residential Design Guidelines promote safe, compatible, and well-designed housing in Los Gatos.

These standards are not a constraint on single-family and two-family housing development.

Hillside Development Standards and Guidelines
The Hillside Development Standards and Guidelines are consistent with the Town’s policies and complement and coordinate with the Town’s Hillside Specific Plan. These standards and guidelines apply to all areas zoned HR, RC, and some lots zoned R-1 as noted on the Town’s Hillside Area Map. The goal of these standards and guidelines is to encourage high-quality design that incorporates sustainable development and open space preservation.

The following summarizes the Hillside Development Standards and Guidelines for Los Gatos:
 Constraints Analysis and Site Selection. Developers must conduct a constraints analysis as deemed necessary by the Town, consult with neighbors, meet with Town staff to discuss the development site, and conduct a view analysis for the development site. The constraints analysis, as required by the Town, requires that developers of hillside property identify the Least Restrictive Development Area (LRDA), or areas deemed most feasible for development on hillsides. For the view analysis, developers must analyze aesthetic impacts; preserve hillside and ridgeline views; and preserve natural features, riparian corridors, and wildlife.
 Site Planning. This section describes site planning standards and guidelines that minimize physical and aesthetic impacts to the site topography. Standards and guidelines discuss grading, drainage, driveways and parking, and safety regarding geologic and fire hazards.  Development Intensity. This section outlines the maximum allowable floor area of development based on lot size.
 Architectural Design. The following architectural design characteristics are addressed in this section:
 Neighbor-friendliness.

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 Sustainability.
 Fire safety.
 Building height.
 Bulk and mass.
 Roofs.
 Architectural features and detailing.
 Materials and colors.
 Site Elements. The specific elements of a hillside development site are addressed:
 Fences and walls.
 Driveway entries.
 Retaining walls.
 Outdoor lighting.
 Accessory buildings, swimming pools, and sport courts.  Impervious surfaces.
 Landscape Design. Because hillside sites are more prone to erosion, landslides, mudslides, and fire and water hazards than flatter sites in Los Gatos, the following concepts are addressed in the landscaping standards and guidelines for hillside development:
 Fire safety.
 Garden and turf locations and plant selection.
 Irrigation.
 Impervious surfaces.
 Plant materials.
 Tree preservation.
 Planned Development Projects. This section describes standards and guidelines that relate specifically to hillside Planned Developments (PDs) in Los Gatos. Additional restrictions are placed on the LRDA for PDs. This section includes standards and guidelines focusing on site preparation, drainage, lot configuration and building locations, street layout and driveways, and trail design.

Draft Objective Design Standards
The purpose of the Objective Design Standards is to ensure that new qualifying multi-family and mixed-use projects in Los Gatos provide high-quality architecture, integrate with surrounding development, and include welldesigned amenities and open spaces. The Objective Design Standards will:
 Comply with recent State housing legislation.
 Implement streamlined and ministerial review processes for qualifying projects.  Ensure that qualifying projects align with the Town’s expectations and vision to maintain and support the character of the Town.
 Provide a set of clear criteria to guide development.  Establish an objective framework by which a qualifying project will be evaluated.

The Draft Objective Design Standards are organized into two primary sections: Site Standards and Building Design. The Site Standards section includes objective standards for site layout and building placement, vehicular access and parking, and outdoor spaces and amenities. The Building Design section includes objective standards for building form and massing, façade articulation, materials, and roof design.

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The Draft Objective Design Standards are intended to promote predictable, safe, and well-designed multi-family housing in Los Gatos. On September 14, 2022, the Planning Commission reviewed and recommended approval of the Draft Objective Design Standards with modifications. The Town Council is expected to consider the Draft Objective Design Standards in mid-November 2022.

Governmental Fees and Exactions
Government policy at both the State and jurisdictional levels play a major role in determining the costs of building new housing. Regulations and permitting processes that result in lengthy or uncertain development carry higher risk and increased financing. Additionally, frequent delays in the entitlement and approval process directly increase costs, such as additional architectural work, inspections, and community meetings.

Streamlining permitting processes, applying permit application processes consistently, increasing interdepartmental cooperation, having adequately funded and staffed planning departments, and increasing byright housing are all actions jurisdictions can take to reduce the constraints represented by fees and permit processing times.

Governmental fees can be a significant portion of the cost of housing development and can therefore be considered a constraint to housing development. Table C-2 below provides all of the planning and development fees that may apply to residential development projects in Los Gatos. Fees are due at the time an application is accepted by the Town, except for projects in the Affordable Housing Overlay Zone, which can waive or defer their fees as a development incentive.

Development fees are a standard component of new construction. Although these fees can add to the cost of residential development, they are necessary for new development to pay its fair share of municipal services and infrastructure for new development. Without adequate development fees, the Town would be unable to serve future growth with adequate municipal services. According to the Town of Los Gatos’ Community Development Department Planning Division, developing a new single-family home (non-hillside) in Los Gatos typically costs about $11,863.28 in planning fee plus an additional deposit of $2,750 for review by the Town’s consulting architect and a deposit of $2,200 for a review by the Town’s consulting arborist. The fee for a new two-family unit is $15,789.16. Multi-family units, three or more units typically cost $16,281.92 in planning fees and the same consulting architect and arborist fees are applicable. These fees include Planning Commission or Design Review Committee approval, fees associated with a Planned Development that does not require a General Plan or Specific Plan amendment, and fees related to finalizing the map and Certificate of Compliance.

On May 4, 2021, the Town Council adopted Ordinance 2318 amending Chapter 25 of the Town Code to establish a public art requirement for private developments. The requirement for public art will apply to following types of development:
(a) New commercial developments (including mixed-use projects), including new construction, and additions and remodels that add more than 50% square footage; and (b) New residential projects of three or more units, including new construction, and additions and remodels that add more than 50% square footage.
(c) Notwithstanding subsections (a) and (b) above, this Chapter shall not apply to:
(i) Affordable housing developments, or, if affordable housing is a part of the development, the affordable housing units shall be subtracted from the valuation of the project as in subsection (d) below; (ii) Historic renovations;
(iii) Repair or reconstruction of structures damaged by flood, fire, wind, earthquake, or other disaster; (iv) Seismic retrofit projects;
(v) Single family and two-family residential units;
(vi) Accessory dwelling units or junior accessory dwelling units; (vii) Any project exempted by federal or state law;
(viii) Municipal facilities; and
(ix) Buildings or structures primarily used for religious worship.

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C-12 Appendix C October 2022
A developer may satisfy the requirements of Chapter 25 of the Town Code by constructing or installing on-site public art valued at one percent of the building permit valuation.

Table C-2 Community Development Department Fees Effective July 1, 2022 Application
Fee
4%
Permit
Tracking
Fee
10%
General
Plan
Update
10%
Advance
Planning
Special
Project
Engineering
Dev Review
Services
Fee Total Fee
1 ZONING APPROVALS
A Architecture and Site Applications
1 Development Review Committee (DRC) Approval
a. New single-family detached
(HR & RC zone) $9,508.00 $380.32 N/A $950.80 $4,396.00 $15,235.12 b. New single-family detached
(HR & RC zones) per unit, as
part of a Planned
Development
$6,603.00 $264.12 N/A $660.30 $4,393.00 $11,920.42
c. New single-family or twofamily units $6,552.00 $262.08 N/A $655.20 $4,394.00 $11,863.28 d. New single-family or twofamily (any other zone) per unit, as part of a Planned
Development
$4,682.00 $187.28 N/A $468.20 $4,398.00 $9,735.48
e. Minor projects (a
development proposal that
does not significantly change
the size, mass, appearance or
neighborhood impact of a
structure, property or parking
lot)
$2,375.00 $95.00 N/A $237.50 $3,374.00 $6,081.50
2 Planning Commission Approval
a. Supplemental fee for DRC
applications as determined in
Section 1.A.(1) or minor
residential development
applications that require
Planning Commission approval
$3,355.00 $134.20 N/A $335.50 $1,225.00 $5,049.70
b. New two-family unit $9,994.00 $399.76 N/A $999.40 $4,396.00 $15,789.16 c. New nonresidential $11,471.00 $458.84 N/A $1,147.10 $4,396.00 $17,472.94 d. New multi-family $10,428.00 $417.12 N/A $1,042.80 $4,394.00 $16,281.92 e. All other $5,815.00 $232.60 N/A $581.50 $4,396.00 $11,025.10 B Conditional Use Permits
1 Conditional Use Permit $6,726.00 $296.04 N/A $672.60 $1,431.00 $9,098.64 2 Conditional Use Permit (when
consolidated with another
application for new
development)
$1,118.00 $44.72 N/A $111.80 $820.00 $2,094.52
C Variance $4,947.00 $197.88 N/A $494.70 $1,431.00 $7,070.58 D Rezoning (other than Planned
Development)

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-13
Application
Fee
4%
Permit
Tracking
Fee
10%
General
Plan
Update
10%
Advance
Planning
Special
Project
Engineering
Dev Review
Services
Fee Total Fee
1 Without General Plan or
Specific Plan Amendment
Actual Cost
($5,000 min.)
$200
(min.)
$500
(min.)
$500
(min.) N/A $6,200.00
2 With General Plan or Specific
Plan Amendment
Actual Cost
($7,000 min.)
$280
(min.)
$700
(min.)
$700
(min.) N/A $8,680.00
E Planned Development
1 Without General Plan or
Specific Plan Amendment Actual Cost YES YES YES N/A Varies 2 Without General Plan or
specific Plan Amendment (HR
or RC Underlying Zone)
Actual Cost YES YES YES N/A Varies
3 With General Plan or Specific
Plan Amendment Actual Cost YES YES YES N/A Varies
4 With General Plan or Specific
Plan Amendment (HR or RC
Underlying Zone)
Actual Cost YES YES YES N/A Varies
5 Town Council Modification to
a Planned Development
Actual Cost
($5,000 min.)
$200
(min.)
$500
(min.)
$500
(min.) N/A $6,200.00
6 DRC Modification to a Planned
Development Zone
Actual Cost
($3,000 min.)
$120
(min.)
$300
(min.)
$300
(min.) N/A $3,720.00
7 Publication costs for the Planned Development Ordinance shall be paid by the applicant.

F Minor Residential
Development $2,375.00 $95.00 N/A $237.50 N/A $2707.50
G Agricultural Preserve
Withdrawal $4,035.00 $161.40 N/A $403.50 N/A $4,599.90
H Planning Division Certificates of Use and Occupancy
1 Change of Use $244.00 $9.76 N/A $24.40 N/A $278.16
2 Change of occupancy
(excluding change of
proprietor of a continuing
business enterprise)
$164.00 $6.56 N/A $16.40 N/A $186.96
L Accessory Dwelling Unit
1 New or existing unit $1,419.00 $56.76 N/A $141.90 N/A $1,617.66 M Mobile Home Park Conversion
Permit
Actual Cost
($5,000 deposit) Varies Varies Varies N/A Varies
N General Plan/Town Code
Amendments
Actual Cost
($5,000 deposit) N/A N/A N/A N/A Varies
2 SUBDIVISIONS
A Lot Line Adjustment (DRC
Approval) $2,254.00 $90.16 N/A $225.40 $3,782.00 $6,351.56 B 4 Lots or Less (DRC Approval) $9,081.00 $363.24 $908.10 $908.10 $4,194.00 $15,454.44 C
4 Lots or Less (as part of a
Planned Development) (DRC
Approval)
$3,750.00 $150.00 $375.00 $375.00 $4,398.00 $9,048.00
D 5 Lots or More $10,230.00 $409.20 $1,023.00 $1,023.00 $5,420.00 $18,105.20 E
5 Lots or More (as part of a
Planned Development) (DRC
Approval)
$4,397.00 $175.88 $439.70 $439.70 $5,420.00 $10,872.28

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C-14 Appendix C October 2022
Application
Fee
4%
Permit
Tracking
Fee
10%
General
Plan
Update
10%
Advance
Planning
Special
Project
Engineering
Dev Review
Services
Fee Total Fee
F Vesting Tentative Map Actual Cost
($500 deposit) N/A N/A N/A N/A Varies
G Lot Merger and Reversion to
Acreage (DRC Approval) $1,117.00 $44.68 $ N/A $111.70 $3,781.00 $5,054.38 H Condominium $7,884.00 $315.36 $788.40 $788.40 N/A $9,776.16 I Condominium (as part of a
Planned Development) $3,750.00 $150.00 $375.00 $375.00 N/A $4,650.00 J Certificate of Compliance (DRC
Approval) $3,257.00 $130.28 N/A $325.70 $2,350.00 $6,062.98 K
VTM applications that require
Town Council
approval and/or DRC
applications that
require Planning Commission
approval. This
fee supplements the above
established
fees.
$2,824.00 $112.96 N/A $282.40 N/A $3,219.36
3 MISCELLANEOUS

APPLICATION FEES
A Time Extensions to Approved
Applications
50% of Current
Fee Varies Varies Varies Varies Varies
B Modification of Approved
Application
75% of Current
Fee Varies N/A Varies Varies Varies
C Conceptual Development
Advisory Committee Review $2,966.00 $118.64 N/A $296.60 N/A $3,381.24 4 ENVIRONMENTAL

ASSESSMENT FEES
A Categorical Exemption No Fee N/A N/A N/A N/A No Fee
B Initial Study (Deposit)* $5,000.00 N/A N/A N/A Yes Varies C
Draft Initial Study Review Fee
(or actual
cost if part of a Planned
Development,
General Plan and/or Town
Code
Amendment)
$2,950.00 N/A N/A N/A $2,045.00 $4,995.00
D Environmental Impact Report
(EIR) Consultant’s Fee N/A N/A N/A N/A Varies
E Draft EIR Review Fee $12,184 Plus
10% EIR Cost N/A N/A N/A Varies Varies
F Impact Monitoring Program
(AB3180)
Actual Cost on an
hourly basis plus
cost of
Consultant (if
necessary)
N/A N/A N/A N/A Varies
5 OTHER

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-15
Application
Fee
4%
Permit
Tracking
Fee
10%
General
Plan
Update
10%
Advance
Planning
Special
Project
Engineering
Dev Review
Services
Fee Total Fee
A Pre-application Conference
Fee No fee Varies Varies Varies N/A Varies
B Fence Height Exceptions $292.00 N/A N/A N/A N/A $292.00 C Peer/Technical Review Actual Cost
($2,000 deposit) N/A N/A N/A N/A Varies
D
Fees for Additional Tech
Review and/or
DRC Review DRC beyond 3
meetings,
Planning Commission hearing
beyond 2
meetings, Town Council
hearing beyond 1
meeting
Actual Cost N/A N/A N/A N/A Varies
E
Request for Service Not
Covered by Any
Other Fee
Actual Cost N/A N/A N/A N/A Varies
F Building Permit Plan Check Fee 20% of Building
Fee N/A N/A N/A N/A Varies
G Surcharges
1 Permit Tracking Maintenance
and Update Surcharge
4% of
Development
Application Fee
N/A N/A N/A N/A Varies
2 General Plan Update
Surcharge
.5% of Bldg. Valuation for
new construction and
additions or 10% of zone
change & subdivision fee
N/A N/A N/A Varies
3 Advanced Planning Projects
10% of
Development
Application
Fee
N/A N/A N/A N/A Varies
4 Route 85 Study Plan Surcharge
**
10% of Development
Application Fee for property
in Route 85 Study Area Plan
N/A N/A N/A Varies
M Appeals
1 Fee to Appeal Planning
Commission Decision to Town
Council
$464 per
residential
$1,867 per
commercial,
multi-family or
tentative
map
N/A N/A N/A N/A Varies
2 Fee to remand applications
from Town Council to Planning
Commission where no error
was made by Planning
Commission
Actual Cost N/A N/A N/A N/A Varies

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C-16 Appendix C October 2022
Application
Fee
4%
Permit
Tracking
Fee
10%
General
Plan
Update
10%
Advance
Planning
Special
Project
Engineering
Dev Review
Services
Fee Total Fee
3 Fee to Appeal Director of
Community Development or
Development Review
Committee decision to
Planning Commission
$234 per
residential N/A N/A N/A N/A Varies
4 Tree Appeals $95.00 N/A N/A N/A N/A $95.00
5 Appeal Transcription fee of
Planning Commission minutes
Actual Cost min.
$500 deposit N/A N/A N/A N/A Varies
L. Research Services Minimum
Charge
Actual Cost min.
$100 deposit N/A N/A N/A N/A Varies
Table C-3 Total Fees per Unit
Jurisdiction Single-Family Small Multi-family Large Multi-family Campbell $72,556 $20,599 $18,541
Cupertino $136,596 $77,770 $73,959
Gilroy $69,219 $40,195 $39,135
Los Altos Hills $146,631 N/A N/A
Los Gatos $11,202 $15,375 $15,375
Milpitas $77,198 $74,326 $59,740
Monte Sereno $33,445 $4,815 $4,156
Morgan Hill $55,903 $41,374 $36,396
Mountain View $90,423 $69,497 $82,591
San Jose $9,919 $23,410 $23,410
Santa Clara $72,034 $7,299 $3,048
Saratoga $64,272 $17,063 $15,391
Sunnyvale $133,389 $126,673 $98,292
Note: Inclusive of impact, building and entitlement fees. Source: SCCPC, 2022 citiesassociation.org/documents/constraints-survey-datasummary-2022 and Los Gatos staff.

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-17
Table C-4 Fees as a Percentage of Total Development Costs Jurisdiction Single-Family Small Multi-family Large Multi-family Campbell 2.6% 2.7% 2.6%
Cupertino 2.9% 10.3% 10.5%
Gilroy 1.5% 5.3% 5.6%
Los Altos Hills 3.1% N/A N/A
Los Gatos 1.2% 0.8% 0.5%
Milpitas 2.8% 9.8% 8.5%
Monte Sereno 0.7% 0.6% 0.6%
Morgan Hill 2.0% 5.5% 5.2%
Mountain View 3.3% 9.2% 11.8%
San Jose 0.4% 3.1% 3.3%
Santa Clara 2.6% 1.0% 0.4%
Saratoga 1.4% 2.3% 2.2%
Sunnyvale 4.8% 16.8% 14.0%
Unincorporated County 0.9% N/A NA
Note: Calculation uses a county-wide average total development cost. Source: SCCPC, 2022 citiesassociation.org/documents/constraintssurvey-data-summary-2022 Permit fees and processing times are not significant constraints to housing production in Los Gatos. In the Spring of 2022, the Santa Clara County Planning Collaborative conducted a survey of fees and permit processing times in Santa Clara County. Fourteen of fifteen jurisdictions completed the survey, an excellent response rate. The results indicate that Los Gatos has overall permit fees that are within the average range of Santa Clara County jurisdictions.

The Town’s fees also represent a relatively low percentage of the overall cost to develop housing in Los Gatos.

Based on the Santa Clara County Planning Collaborative survey results and an analysis on housing development costs performed by Century Urban, a San Francisco based real estate consulting firm, the fees represent approximately 1.2 percent of total development costs for a single-family home, 0.8 percent for a 10-unit multifamily development, and 0.5 percent for a 100-unit multi-family development. The fee structure does not disproportionally burden multi-family housing.

Processing and Permitting Time
Government policy at both the State and jurisdictional levels play a major role in determining the costs of building new housing. Regulations and permitting processes that result in lengthy or uncertain development carry higher risk and increased financing. Additionally, frequent delays in the entitlement and approval process directly increase costs, such as additional architectural work, inspections, and community meetings. Streamlining permitting processes, applying permit application processes consistently, increasing interdepartmental cooperation, having adequately funded and staffed planning departments, and increasing by-right housing are all actions jurisdictions can take to reduce the constraints represented by fees and permit processing times.

Each stage of the residential development process must go through some form of Town approval. On average, a single- or multi-family infill residential application typically processes in approximately three to six months, unless environmental review is required. Hillside residential applications on average take four to six months to process.

Mixed-use projects are processed in approximately four to eight months, unless environmental review is required.

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C-18 Appendix C October 2022
With environmental review, the process generally takes six to 18 months, depending on the size and complexity of the project.

Processing of a typical, market rate single- or multi-family housing application includes the following steps:
 Submission of an Architecture and Site Application.
 Distribution of the application to Planning, Building, Engineering, and the Santa Clara County Fire District departments.
 Staff review of application and staff conference with the applicant to resolve any concerns or plan deficiencies, including design issues.
 If deemed complete, staff continues processing the application and begins environmental review, if necessary.
 Completion of environmental review and traffic impact analysis, as appropriate. Arborist review, architectural review, and/or geotechnical review may be conducted during this time through the Architecture and Site application.

Approval is required by the following bodies:
 Development Review Committee (with appeal to the Planning Commission and further appeal to the Town Council) for projects that require no change in the General Plan or Zoning Code.  For hillside development applications, Planning Commission approval may be required depending on the scope of the project.
 Town Council for projects that require a change in the General Plan or Zoning Code, and for Planned Developments.

Processing for a typical mixed-use housing project includes the following steps:
 Submission of application, including application for a Conditional Use Permit (CUP), and an Architecture and Site Application.
 Distribution of the application to Planning, Building Engineering, and the Santa Clara County Fire District departments.
 Staff review of application and staff conference with applicant to resolve any concerns or plan deficiencies, including design issues.
 If deemed complete, staff continues processing the application and begins environmental review, if necessary.
 Completion of environmental review and traffic impact analysis, as appropriate. Arborist review, architectural review, and/or geotechnical review may be conducted during this time through the Architecture and Site application.
 Approval is required by one or both of the following bodies:
 Planning Commission (with appeal to the Town Council) for projects that require no change in the General Plan or Zoning Code, and for a CUP and Architecture and Site Application.  Town Council for projects that require a change in the General Plan or Zoning Code, and for Planned Developments.

Design and neighborhood compatibility issues also often lengthen the permitting and processing time. To address this problem, the Town contracts out to an architectural consultant to review plans and provide recommendations on development applications compliance with the Residential Design Guidelines or Hillside Development Standards and Guidelines.

Architectural, geotechnical, and arborist reviews are conducted early in the development application process.

These reviews are conducted during the review of the Planned Development or Architecture and Site applications and do not lengthen the processing time. These reviews also streamline the public hearing process, allowing the

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-19
Planning Commission to rely on the recommendations of Town staff and the Town’s consultants to receive qualified input from an architect, arborist, and geotechnical consultant, leading to a more efficient approval process.

Table C-5 Processing Times (in months)
Jurisdiction ADU
Process
Ministerial
By-Right
Discretionary
By-Right
Discretionary
(Development
Review
Commitee)
Discretionary
(Planning
Commission)
Discretionary
(Town
Council)
Campbell 1 1 3 N/A 5 8
Cupertino 1 to 3 1 to 6 2 to 4 2 to 4 3 to 6 6 to 12
Gilroy 1 to 2 1 to 2 2 to 4 N/A 4 to 5 5 to 6
Los Altos Hills 1 to 2 0.5 to 2 2 to 3 3 to 4 4 to 6 5 to 8 Los Gatos 1 to 2 1 to 2 1 to 2 2 to 4 4 to 6 6 to 12
Milpitas 1 to 3 1 to 3 2 to 4 3 to 4 4 to 6 6 to 12
Monte Sereno 0.75 0.75 1 1 to 2 1 to 2 1 to 2
Morgan Hill 1 to 2 1 to 3 *2 to 3 2 to 3 4 to 6 4 to 6
Mountain View 3 to 5 4 to 6 2 to 3 *6 to 18 N/A 12 to 24 San Jose 2 1 to 3 7 7 7 to 11 5 to 12
Santa Clara 0 to 1 0 to 1 0 to 3 4 to 9 6 to 9 6 to 12
Saratoga 1 1 to 2 2 to 3 N/A 4 to 6 6 to 12
Sunnyvale 1 to 3 1 to 3 3 to 6 6 to 9 9 to 18 9 to 18
Unincorporated
County 4 to 6 6 to 8 9 to 12 12 to 15 15 to 18 15 to 18 Entitlements Only. Source: SCCPC, 2022 citiesassociation.org/documents/constraints-survey-data-summary-2022 Jurisdictional permit processing procedures that are lengthy or uncertain can dissuade developers from building new housing or result in housing that is more expensive. Within Los Gatos, the permit processing times are within the average range for jurisdictions within Santa Clara County. The Town’s permit process also does not disproportionally burden ADU applications or applications for multi-family housing.

SB 35 Streamlining
(Government Code section 65913.4) allows qualifying development projects with a specified proportion of affordable housing units to move more quickly through the local government review process and restricts the ability of local governments to reject these proposals. The bill creates a streamlined approval process for qualifying infill developments in localities that have failed to meet their RHNA, requiring a ministerial approval process, removing the requirement for CEQA analysis, and removing the requirement for discretionary entitlements granted by the Planning Commission.

Since the adoption of this section of the Government Code, the Town has received one application under these provisions. The Town has included Program AM in the Housing Element to prepare an SB35 checklist and written procedures for processing SB35 applications.

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C-20 Appendix C October 2022
SB9 California Housing Opportunity and More Efficiency (HOME) Act SB9, also known as the California Housing Opportunity and More Efficiency (HOME) Act, is a state bill that requires cities to allow one additional residential unit on parcels zoned for single-dwelling units. Since the adoption of this section of the Government Code, the Town has adopted an interim SB9 ordinance and is in the process of developing a permanent ordinance for adoption by the end of 2022.

Requests to Develop at Densities Below Those Permitted
New State Housing Element law now requires the non-governmental constraints analysis to evaluate developer requests to build at densities below the density identified in the Housing Element sites inventory. In Los Gatos, properties generally develop around the mid to high range of allowable densities. Requests to develop at densities below those permitted are not an issue in Los Gatos.

Length of time between Application Approval and Building Permit Issuance New Housing Element law now also requires an examination of the length of time between receiving approval for a housing development and submittal of an application for building permits. The time between application approval and building permit issuance is influenced by a number of factors, none of which are directly impacted by the Town. Factors that may impact the timing of building permit issuance include: required technical or engineering studies; completion of construction drawings and detailed site and landscape design; securing construction and permanent financing; and retention of a building contractor and subcontractors.

The majority of residential permits in Los Gatos are for single-family homes, with building permit issuance generally taking eight to 14 months after Planning approvals. Hillside properties may take a few months longer due to the need for technical and engineering studies. Among the Town’s recent multi-family developments, the time between approvals and permit issuance has averaged 12 to18 months. In Los Gatos, most approved projects are constructed in a reasonable time period
C.2 Local Housing Programs
State Housing Element law requires that an analysis of governmental constraints on housing production include local government programs that regulate housing development in any way, including imposing housing cost limitations or encouraging changes in density. Los Gatos has six local housing programs that are potential constraints on market-rate housing production in the Town. The Below Market Price Program, Affordable Housing Fund, Rental Dispute Resolution Program, Density Bonus Program, State Density Bonus Program, and the Affordable Housing Overlay are discussed below.

Below Market Price (BMP) Program
The BMP Program implements the Town of Los Gatos’s inclusionary zoning ordinance, which requires that a portion of new residential construction in Los Gatos be dedicated to affordable housing. Los Gatos’s inclusionary zoning ordinance was adopted in 1979 as one of the first of such programs in California.

The BMP Program promotes the development of affordable housing units by providing standards and guidelines that require the development of a certain number of quality affordable units per rental or owner development project, based on the size of the project. The BMP Program requires the development of affordable housing where sales and rents cannot be more than 80 percent of the current HUD Fair Market Rents (FMR) as determined by the Santa Clara County Housing Authority. The BMP Program allows low- and moderate-income households the opportunity to purchase low- and moderate-income housing in Los Gatos.

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-21
The BMP Program requirements apply to all residential development projects that include five or more residential units or parcels which involve:
 New construction of ownership or rental housing units, including mixed-use developments and addition of units to existing projects.
 Subdivision of property for single family or duplex housing development.  Conversion of rental apartments to condominiums or other common interest ownership.  Conversion of non-residential use to residential use.

The intent of the BMP Program is to provide a supply of affordable housing for households who work or currently reside in Los Gatos. However, there may be circumstances when the construction of a BMP unit is impractical.

The Town will consider, at its discretion, a fee payment in-lieu of constructing BMP units for Planned Unit Developments with an underlying HR zone or for residential developments with five to nine units. The required inlieu fee of six percent of the building permit valuation for the entire project must be paid to the Town prior to issuance of the certificate of occupancy for the market-rate units.

Additionally, the Town Council may consider off-site construction of BMP units for continuum of care facilities, residential developments in the HR zone, or residential developments with five to nine units provided that developers provide sufficient justification that an on-site BMP is infeasible.

The developer of “for sale” BMP units shall enter into an affordability agreement with the Town. The agreement will ensure that the BMP units are sold to qualified buyers and will be released by the Town through the escrow process once the BMP is sold to a qualified buyer. Because the BMP Program regulates the number of affordable units required as part of new residential construction in Los Gatos, the program could be considered a constraint on market-rate housing development. However, because the BMP Program requires the construction of affordable units with every new qualifying development, the Town sees this program as an opportunity to create and preserve affordable housing for the community. Based on a track record of successful development and preservation of affordable housing through the BMP Program, Los Gatos does not consider the program to be a constraint on affordable housing development; nevertheless, the Town proposes to study the BMP Program and implement recommendations to augment and improve it in order to facilitate the construction of more units.

Affordable Housing In-Lieu Fee Fund
In-lieu fees are paid into the Town’s Affordable Housing Fund and are calculated as six percent of building permit valuation as determined by the Building Official. As previously noted, these fees may be paid by developers of new residential construction with five or more units but less than 10 units or new residential construction in a Planned Unit Development with an underlying zone of HR, instead of building an affordable housing unit(s) under the BMP Program. All residential construction over 10 units must build affordable units. Payment of in-lieu fees is required for the approval of Hillside Planned Developments with five or more residential sites. Use of the Affordable Housing Fund includes, but is not limited to:
 Subsidizing the cost of owner-occupied units to make them affordable to low and/or moderate-income households.
 Purchasing rental units to make them affordable to low and/or moderate-income households.  Purchasing land for the future development of affordable housing.  Developing affordable housing.
 Supplementing affordable housing projects developed through the Los Gatos Redevelopment Agency.  Funding administration of the program, as approved by the Town Council in its annual budget process.

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This additional fee levied on developers may be considered a constraint on housing development; however, the fees are paid into a fund that will be used to develop more affordable housing in Los Gatos. Given the low rate of construction of affordable units, the Town proposes to study the In-Lieu Fund Program and implement recommendations to augment and improve it in order to facilitate the construction of more units.

Rental Dispute Resolution Program
The Los Gatos Rental Dispute Resolution Program provides conciliation, mediation and arbitration services for both renters and landlords in Los Gatos. The program is administered by Project Sentinel, a local non-profit organization contracted by the Town. This program is not considered a constraint on housing development in Los Gatos. Los Gatos renters may also contact Neighborhood Housing Services Silicon Valley for assistance.

The Town helps preserve affordable rental housing costs through the Rental Mediation and Dispute Resolution Ordinance which applies to rental complexes of three or more units. The ordinance sets an annual limit on rent increased to five percent unless the landlord is able to demonstrate capital or financing costs to justify a greater increase. The Town has similar rent controls for mobile home units.

Mobile homes are an affordable housing resource in the Town of Los Gatos. They are often owned by seniors, households on fixed incomes, and households within the lower and moderate-income categories. Mobile home tenants are in the unique position of having made a substantial investment in a housing unit for which ground space is rented. The Mobile Home Ordinance establishes rent increase control within mobile home parks to ensure that a variety of housing types, including mobile homes, remain viable options to lower and moderateincome households in the community. Rents in mobile home parks cannot be increased by more than five percent annually unless operations and maintenance expenses significantly increased within the most recent year in comparison to the previous year.

Density Bonus Program
The Density Bonus Program allows qualified projects to add up to 100 percent of the units provided by the General Plan land use designation as long as these additional units are restricted to seniors, disabled persons, very low and/or low-income households.

Over the last Housing Element cycle, the Town approved the North 40 Phase One development which included 49 very-low income and one moderate-income manager unit as density bonus units.

The Density Bonus Program has the potential to provide additional opportunities to build more, affordable units in Los Gatos. The Town is including an Implementation Program to study the existing Density Bonus Ordinance and recommend changes to increase the number of units constructed. The study will include an evaluation of the implementation of the ordinance to date and actual construction of affordable housing units that utilized the Density Bonus Program.

State Density Bonus Program
The Town adopted the State Density Bonus Program in June 2012. The program allows densities, incentives, concessions and maximum parking standards consistent with State law. In addition, the Town modified the program to apply to senior and physically handicap populations.

The Town has not processed a request for a State Density Bonus since the ordinance was adopted in June 2012 because the Town’s BMP Program and General Plan policies exempt affordable housing units from the calculated density in a project. The State Density Bonus Program provides opportunities to build additional, affordable units in Los Gatos; consequently, this program is not considered a constraint on housing development.

Affordable Housing Overlay Zone
The Town adopted the AHOZ, and it applies to one property in the Housing Sites Inventory (see Table 6-2). The AHOZ allows densities (up to 20 units per acre on designated sites), development standards, and concessions that will encourage affordable housing. The Housing Element includes a program to modify the affordability

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-23
requirements in the Town Code to require a minimum of 40 percent affordable units on the Southbay AHOZ site instead of the currently prescribed affordability levels. Affordability would be for low and very low-income households.

Constraints on Housing for Persons with Disabilities
State law requires that the Housing Element analyze governmental constraints to housing for persons with disabilities. How a jurisdiction defines “family” in its zoning regulations can be a potential constraint to facilitating housing for persons with disabilities. The existing definition of “family” in the Town Code is “one or more persons who comprise a single housekeeping unit” or “households of six or fewer persons living in a residential care facilities small family home as defined by the California Community Care Facilities Act.” In Los Gatos, group homes are defined by the Town Code as synonymous with small family home residential care facilities, which are defined by the Town Code as “a residential care facility in the dwelling of a licensee in which care or supervision is provided for six or fewer persons. Whether or not unrelated persons are living together, a residential facility that serves six or fewer persons shall be considered a residential use of property for the purposes of this article. In addition, the residents and operators of such a facility shall be considered a family for the purposes of any law or zoning ordinance which relates to the residential use of property.” Group homes are permitted by right in all residential districts, consistent with State law, and are permitted with a CUP in the Office (O), Neighborhood Commercial (C-1), Central Business District (C-2), and Restricted Highway Commercial (CH) zones. The Town imposes no spacing or concentration requirements on any of the allowed residential care facilities. Large family home residential care facilities, which have a capacity for seven to 12 children or seven to 15 adults are allowed in all districts with a CUP, except where large family homes are prohibited in the RMH, LM, and CM districts.

Generally, the Town facilitates housing for persons with disabilities by following the accessibility requirements of the California Title 24 Multi-family Accessibility Regulations for multi-family housing of three or more units.

Housing rehabilitation assistance and accessibility improvements are provided through the Town’s Community Services and Community Development departments.

The Town encourages accessibility improvements by requiring that specific design features be incorporated into all new residential home projects as a condition of approval. These requirements include:
 A wooden backing that is no smaller than 2 inches by 8 inches in all bathroom walls, at water closets, showers, and bathtubs. It will be located 34 inches from the floor to the center of the backing, suitable for the installation of grab bars.
 All passage doors of at least 32 inches wide on the accessible floor.  A primary entrance that is a 36-inch-wide door, including a five-foot by five-foot level landing, no more than one inch out of plane with the immediate interior floor level, with an 18-inch clearance.

In 2013, the Town adopted a procedure for requesting reasonable accommodation for persons with disabilities seeking equal housing access under the Federal Fair Housing Act and the California Fair Employment and Housing Act and in accordance with State housing law. A request for reasonable accommodation may include a modification or exception to the standards and practices for the siting, development, and use of housing or housing-related facilities that would eliminate regulatory barriers to accessible housing. Requests for reasonable accommodation shall be reviewed by the Planning Director within 45 days of the request. However, if the request is concurrent with a discretionary land use application, then the body overseeing the discretionary land use application will also make a determination on the reasonable accommodation request. There are seven mandatory criteria for granting a reasonable accommodation request:
 The housing will be used by an individual disabled under the Federal Fair Housing Act and the California Fair Employment and Housing Act.
 The request is necessary to make specific housing available to an individual with a disability.

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 The request would not impose an undue financial or administrative burden on the Town.  The request would not require a fundamental alteration in the nature of a Town program or law, including but not limited to land use and zoning.
 There would be no impact on surrounding uses.
 Due to physical attributes of the property or structures the request is necessary.  There is no alternative reasonable accommodation which may provide an equivalent level of benefit.

By adopting a formal procedure, the Town has provided an objective process with clear directions for both the applicant and the decision makers. This is a benefit to persons with disabilities and is not a constraint on housing.

Low Barrier Navigation Centers
AB 101, adopted in 2019, requires approval 'by right' of low barrier navigation centers that meet the requirements of State law. A “Low Barrier Navigation Center” means a Housing First, low barrier, service-enriched shelter focused on moving people into permanent housing that provides temporary living facilities while case managers connect individuals experiencing homelessness to income, public benefits, health services, shelter, and housing.

If the City receives applications for these uses, it will process them as required by State law. A program has been included in the Housing Element to develop by right procedures for processing low barrier navigation centers.

Employee Housing
California Health and Safety Code Section 17021.5 (Employee Housing Act) requires jurisdictions to permit employee housing for six or fewer employees as a single-family use. Employee housing shall not be included within the zoning definition of a boarding house, rooming house, hotel, dormitory, or other similar term that implies that the employee housing is a business run for profit or differs in any other way from a family dwelling.

Jurisdictions cannot impose a CUP, variance, or other zoning clearance of employee housing that serves six or fewer employees that is not required of a family dwelling of the same type in the same zone. The Town’s Zoning Code addresses small employee housing as a residential care facility.

Farm Employee Housing
The Town of Los Gatos does not currently have any identified farmworkers. Given the lack of farmworkers in the community, the Town has not identified a need for specialized farmworker housing beyond overall programs for housing affordability.

C.3 Non-Governmental Constraints to Housing
Development
Market constraints to housing development in Los Gatos are the primary non-governmental impediment to housing production. The Town is located near Silicon Valley jobs and offers residents desirable amenities such as an historic downtown and a school district in which student performance ranks in the top four percent of the State.

Development Costs
In January 2022, the Santa Clara County Planning Collaborative distributed a survey to Santa Clara County jurisdictions to better understand the fees and processing times involved in the development of single-family and multi-family housing. Fourteen out of sixteen jurisdictions responded with locally collected data, which

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-25
Collaborative staff used to identify major trends and produce data tables1. Additionally, the real estate economics consulting firm Century Urban conducted independent research on land and development costs2. Data and preliminary reports can be found on the Collaborative website: citiesassociation.org/constraints.

The cost of development is generally high in Santa Clara County and represents a significant constraint on the production of both single-family and multi-family housing. According to analysis by Century Urban, average development costs for single-family homes in the county range from $1,667,000 to $5,910,000. The cost of land and the size of the units are the two factors causing the most variance. Multi-family development costs are also quite high, though lower on a per unit basis compared to single family homes. Based on a survey of local development costs, Century Urban estimates the average cost per unit for a 10-unit prototype at $726,000 to $846,000. The average cost per unit to develop a 100-unit building ranges from $672,000 to $792,000.

Jurisdictions were asked to estimate development fees based on the following hypothetical housing types and related detailed assumptions:
 Single-Family: A new single-family house on an empty lot, 2,600 square feet or 5,000 square feet, in an existing neighborhood with no significant grading or other complicating factors.  Small Multi-family: A project that includes 10 units in one building on one acre, where no zoning changes are required and permitting is by-right with medium complexity.  Large Multi-family: A project that is comprised of 100 units on two acres, 80,000 total square feet, with construction type V over a concrete podium.

Century | Urban was engaged by Baird + Driskell, hired by Association of Bay Area Governments (ABAG) Planning Collaborative to perform research on the development costs of certain residential prototypes in Santa Clara County. The estimates shown below are based on data and sources including but not limited to: similar projects Century | Urban has underwritten and/or priced; specific project economics Century | Urban has reviewed; direct conversations with developers and cost estimators; database research including CoStar, MLS, Redfin, and title databases; online research sources including municipality and project websites; market reports compiled by real estate sales and research organizations; and, Century | Urban’s general experience assessing residential project feasibility in the San Francisco Bay Area.

Land Costs
The price of land also varies across the county based on site conditions and location, but land costs in Santa Clara County are notably higher than costs in neighboring counties. Century Urban estimates the average land price in Santa Clara County for single-family homes (based on sales within the last three years) at $1,320,000.

Land costs are lower for multi-family developments, estimated at $600,000 for small developments and $6,000,000 for large developments, or $60,000 per unit. The data does not include properties with existing homes or infrastructure that were redeveloped as new single-family homes, and the data for some cities is limited.

As the data collected is not comprehensive, summaries and averages may be valuable for reaching overall conclusions about the range of land prices in the counties, but they may or may not be representative of a given city’s average or median land price or the land price for a given parcel. The information should therefore be reviewed noting the limited number of data points for certain cities, including Los Gatos where only 15 data points were available. Land prices vary substantially by location, topography, site conditions, shape of the parcel, neighboring uses, access, noise, and many other factors. In addition, completed sales are necessarily past transactions and may not represent the current state of the market and expected future land sale prices. 1 Santa Clara County Planning Collaborative, 2022. Summary of Constraints Survey Data. citiesassociation.org/documents/constraintssurvey-data-summary-2022 2 Century Urban, 2022. San Mateo and Santa Clara Counties Development Cost & San Mateo County Unit Mix Research. citiesassociation.org/documents/development-cost-data.

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There are very few vacant parcels zoned for multi-family development, and such parcels demand premium prices because of the high demand to live in Los Gatos. Additionally, most parcels have existing improvements that increase acquisition costs. Countywide, the land costs for multi-family development sites cost approximately $60,000 per unit.

Hard and Soft Costs
Soft costs for housing development include the cost of architectural, engineering, accounting, legal and other professional services, as well as the cost of obtaining permits and paying government-imposed fees. Carrying costs and the cost of construction financing can also be considered soft costs. Century Urban’s analysis finds that soft costs (such as impact fees and costs accumulated through permitting delays) are hard costs. Hard costs include the costs of labor and materials.

Hard costs are very high in Santa Clara County, and both the high cost of labor and the high cost of materials could be considered constraints on housing development. According to analysis by Century Urban, residential hard and soft costs do not vary significantly across Santa Clara County.

Hard and soft costs contribute significantly to the overall cost of developing new housing. Hard costs comprise over half of development costs for multi-family housing. Although hard costs are significant for single-family production as well, they comprise a lower percentage of overall costs because of the larger role of land costs in single-family construction. High hard costs are difficult for individual jurisdiction to mitigate.  Single-family detached ~2,660 square feet: $81 to $965 per square foot.  Single-family detached ~5,000 square feet: $714 to $1,174 per square foot.  Multi-family apartments/condominiums less than 10 units on one acre: $726,500 to $846,500 per unit.  Three- to four-story 100-unit multi-family apartment/condominiums with type V construction over a concrete podium parking: $672,500 to $792,500 per unit.

Availability of Financing
The residential real estate market is strong in the Town of Los Gatos. Local realtors and developers have noted that Los Gatos was affected by the home mortgage foreclosure crisis that plagued many communities in the last fifteen years. Adjustable-rate mortgages, jumbo loans (those above $417,000), and Government-insured Federal Housing Administration home purchase loans, in addition to all-cash offers, are common in Los Gatos. Adequate financing through local banks is available to the Los Gatos community.

The Housing Trust of Santa Clara County offer three low-interest, down payment or closing cost loan programs for income qualified buyers in Los Gatos. Participation in this program includes homebuyer education classes.

The County of Santa Clara Office of Affordable Housing administers three homebuyer assistance programs. The Home Investment Partnerships Program offers down payment assistance for first-time buyers. The Mortgage Credit Certificate Program reduces the federal income taxes of qualified borrowers purchasing qualified homes, thus acting like a mortgage subsidy. The Down payment Assistance Program for First-time Buyers offers a subsidy for borrowers meeting a maximum income limit and maximum purchase price limit.

The Home Mortgage Disclosure Act (HMDA) requires the reporting of data on residential loan applications, which provides insight into the availability of financing in the community. Table C-6 summarizes HMDA data for the San Jose, Sunnyvale, Santa Clara MSA. As shown in the table below, approximately 25 percent of all loan applications for the lowest income group are denied.

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-27
Table C-6 Home Purchase and Improvement Loans
Income Group
Loan
Applications
Loans Approved (Originated) Loans Denied
# % # %
>50% of MSA AMI 9,757 4,518 46.3% 2,550 26.1%
50-79% of MSA AMI 19,780 12,673 64.1% 2,683 13.6%
80-99% of MSA AMI 8,535 5,775 67.7% 852 10.0%
100-119% of MSA AMI 28,507 20,122 70.6% 2,361 8.3%
≥120 of MSA AMI 87,715 59,930 68.3% 6,951 7.9%
TOTAL 154,294 103,018 66.8% 15,397 10.0%
SOURCE: Home Mortgage Disclosure Act (HMDA), 2020
MSA – Metropolitan Statistical Area
AMI – Area Median Income
Environmental Constraints
The environmental setting affects the feasibility and cost of residential development. These areas contain environmental constraints on development, such as steep slopes, landslide hazards, fire hazards, or flood hazards, and therefore, much of the undeveloped land has been set aside as open space. The Town is adjacent to other built out communities and nestled against the Santa Cruz Mountains, limiting opportunities for expansion.

The following are environmental constraints and hazards that affect, in varying degrees, existing and future residential developments.

Urban and Wildland Fire Hazards
Wildfires are becoming an all too regular event in California, and both urban and wildland fires are a threat to the Town of Los Gatos. Wildfires that burn exclusively in uninhabited natural areas generally pose little risk to lives or property, although the smoke from such fires may cause respiratory problems for people nearby. Fires that occur along the wildland-urban interface (WUI) are much more of a hazard, as they can spread into urbanized areas.

Wildfire risk is dependent on several factors, including the amount and type of vegetation in the area, weather, and local topography. Factors such as narrow, winding roads and vegetation also slow response to fires, increasing the risk of spread.

Based on the increased potential for devasting wildfires in Santa Clara County and the Town of Los Gatos, CAL FIRE developed and adopted “Fire Hazard Severity Zone” maps. These maps highlight that most of the County is located within the “high” fire severity zone, with smaller portions of the County within the “moderate” and “very high” fire severity zones. More than half of the southern portion of the Town is in the Very High Fire Hazard Severity Zone, with most of the areas to the south in the High or Moderate zones. The Town must therefore strongly incorporate fire hazard mitigation into its land use decisions and requirements to protect residents and property. Potential impacts are mitigated by policies in the 2040 General Plan Hazards and Safety Element including the following:
 Require new development, including additions to existing structures, located in or adjacent to fire hazard areas to minimize hazards to life and property, by using fire preventive site design, access, fire-safe landscaping, building materials, and incorporating defensible space and other fire suppression techniques.  Minimize exposure to wildland and urban fire hazards through proactive code enforcement, public education programs, use of modern fire prevention measures, quick and safe access for emergency equipment and evacuation, and emergency management preparation.  Restrict development in areas with inadequate water flow or emergency access.

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 Monitor and remove excessive buildup of flammable vegetative materials on Town properties and along critical ingress/egress routes in the WUI.

Geological and Seismic Hazards
The San Francisco Bay Area is in one of the most active seismic regions in the United States. Los Gatos is near several active faults including the San Andreas, Hayward, and Calaveras Faults. Ground shaking is the primary risk in an earthquake and can set off a chain reaction of secondary landslides and liquefaction, or loss of soil strength. The region around the Lexington Reservoir also has higher risk of ground shaking should an earthquake occur. Implementation of applicable building codes and geotechnical investigations will minimize potential loss of life and damage to property from primary and secondary seismic hazards and siting essential structures and services outside high-risk areas will enable faster emergency response after an earthquake.

Seismic activity within or near the Santa Clara County region has historically caused significant damage to buildings and infrastructure in the Town of Los Gatos due to ground shaking and landslides. Five earthquakes have affected Los Gatos in the 20th century, with the 1906 San Francisco and 1989 Loma Prieta earthquakes having the highest magnitude. Potential impacts are mitigated by policies in the Draft 2040 General Plan Hazards and Safety including the following:
 Require new development to be sited away from high risk geologic and seismic hazard zones or, if located in a high-risk zone, incorporate construction techniques or specialized technologies to reduce risk. Restrict new development and redevelopment based on the levels of risk and potential severity of geologic hazards.
 Require geotechnical reports analyzing seismic hazards, grading, and construction methods.  Require that a licensed geologic/geotechnical engineer complete the Town Geologic Hazards Checklist for all new proposed development to demonstrate that potential hazards have been identified and that proposed structures, including grading cuts and fills, will be designed to resist potential earthquake effects.  Implement the Hillside Development Standards and Guidelines.

Flood and Inundation Hazards
Flooding can threaten life, safety, and property and can occur in a number of ways. The level in a body of water, such as a lake or creek, can rise higher than the water body’s banks, causing it to overflow into nearby areas.

Heavy precipitation can overwhelm the ability of soil to absorb water or storm drains to carry it away, causing water to build up on the surface. Localized flooding may also occur as a result of infrastructure failure, such as a burst water tank or pipe. In Los Gatos, the floods that are of most concern are from heavy rainfall causing local flooding or flash floods. Flooding puts various populations in Town at risk. A 500-year flood could affect upwards of 28,000 people and cause $10 billion of structural damage.

Beyond localized flooding, Los Gatos faces a flood threat from dam inundation. While less common, dam inundation is recognized in both the Town Emergency Operations Plan and Santa Clara County OAHMP. The Lexington Reservoir as contained by the James J. Lenihan Dam is the largest concern for dam inundation.

Lexington Reservoir is the third largest reservoir in Santa Clara County storing 19,044 acre-feet of water. The potential inundation zone in the event of failure is significant, with the potential to affect over 3,000 people and damage over 1,000 structures. As future climate change-related impacts increase, localized flooding will become more common due to more extreme storms increasing the potential for more frequent and severe riverine flooding. Potential impacts are mitigated by policies in the Draft 2040 General Plan Hazards and Safety including the following:
 Require site planning and building design to mitigate identified flood and inundation hazards.  Require that new development and substantial improvements to existing structures meet Federal and State standards when located within FEMA Flood Insurance Rate Maps (FIRMs) designated 100-year flood zones, as designated by current FEMA mapping.

Appendix C. Governmental and Non-Governmental Constraints October 2022 Appendix C C-29
 Cooperate with the Santa Clara Valley Water District to develop and maintain additional stormwater retention facilities in areas where they are needed or where the design capacity of existing retention facilities cannot be restored.

Hazards and Hazardous Materials
The use, manufacture, production, transportation, storage, treatment, disposal, and clean-up of hazardous materials and hazardous wastes present a potential threat to the health and safety of those who are using the materials and those who could be affected by improper or accidental release or disposal. Hazardous materials include all toxic, flammable, combustible, corrosive, poisonous, and radioactive substances that possess the potential to bring harm to the public or the environment. The Town maintains a comprehensive list of Hazardous Waste and Substance sites where hazardous materials are present and cleanup activities are or may be necessary. Potential impacts are mitigated by policies in the 2040 General Plan Hazards and Safety Element.

Noise and Air Quality
Noise and air quality impacts associated with Highways 17 and 85, other high-volume arterial roadways, and the Union Pacific Railroad line parallel to and south of Highway 85 could potentially impact housing. The California Building Code and the Noise Element of the Los Gatos General Plan contain policies and standards that mitigate noise impacts, and the regulations of the Bay Area Air Quality Management District require careful study and mitigation of health risks from poor air quality. Potential impacts are mitigated by policies in the Draft 2040 General Plan Environment and Sustainability Element.

Environmental constraints to housing development are mitigated where public health, safety, and welfare can be protected.

Site Inventory Analysis D

APPENDIX

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-1
D.1 Vacant and Available Sites
The Plan Bay Area 2050 Final Blueprint1 forecasts that the nine-county Bay Area will add 1.4 million new households between 2015 and 2050. For the eight-year time frame covered by this Housing Element Update, the Department of Housing and Community Development (HCD) has identified the region’s housing need as 441,176 units. The total number of housing units assigned by HCD is separated into four income categories that cover housing types for all income levels, from very low-income households to market rate housing. This calculation, known as the Regional Housing Needs Allocation (RHNA), is based on population projections produced by the California Department of Finance as well as adjustments that incorporate the region’s existing housing need. The adjustments result from recent legislation requiring HCD to apply additional adjustment factors to the baseline growth projection from California Department of Finance, in order for the regions to get closer to healthy housing markets. The adjustments focus on the region’s vacancy rate, level of overcrowding, and the share of cost burdened households and seek to bring the region more in line with comparable areas. The new laws governing the methodology for how HCD calculates the RHNA resulted in a significantly higher number of housing units for which the Bay Area must plan compared to previous cycles.

D.2 Regional Housing Needs Allocation
In December 2021, ABAG adopted a Final Regional Housing Needs Allocation (RHNA) Methodology. For Los Gatos, the RHNA required to be planned for the 6th cycle Housing Element Update is 1,993 units, an increase of 322 percent from the last cycle.

RHNA Summary
Los Gatos’ share of the regional housing need for the eight-year period from 2023 to 2031 is 1,993 units, which is a 322 percent increase over the 619 units required by the 2015 to 2023 RHNA. The housing need is divided into the four income categories of housing affordability. Table D-1 shows Los Gatos’ RHNA for the planning period 2023 through 2031 in comparison to the RHNA distributions for Santa Clara County and the Bay Area region.

With an update required every eight years by the State of California, this Housing Element covers a planning period from January 31, 2023, to January 31, 2031 (also referred to as the “6th cycle”).

Table D-1 Los Gatos’ Regional Housing Needs Allocation: 2023–2031 Income Group
Los
Gatos
Units
Percent
Santa
Clara
County
Units
Percent
Bay
Area
Units
Percent
Very Low Income (<50% of AMI) 537 26.9% 32,316 24.9% 114,442 25.9% Low Income (50%-80% of AMI) 310 15.6% 18,607 14.4% 65,892 14.9% Moderate Income (80%-120% of AMI) 320 16.1% 21,926 16.9% 72,712 16.5% Above Moderate Income (>120% of AMI) 826 41.4% 56,728 43.8% 188,130 42.6% Total 1,993 100.0% 129,577 100.0% 441,176 100.0%
Source: ABAG 2021
1 Plan Bay Area 2050 is a long-range plan charting the course for the future of the nine-county San Francisco Bay Area. It covers four key issues: the economy, the environment, housing and transportation

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D.3 Site Inventory
The purpose of the sites inventory is to identify and analyze specific sites that are available and suitable for residential development during the planning period between 2023-2031 in order to accommodate Los Gatos’ assigned 1,993 housing units. The Town does not build the housing but rather creates the implementation programs and policies to plan for where the housing can be located and how many units could be built on potential sites.

In 2017, Senate Bill (SB) 166 was signed into law and included new “no net loss” provisions that require communities to provide an ongoing, adequate supply of land resources for housing development during the entirety of the housing element update planning period. These provisions mean communities face risks of noncompliance should a housing site be developed with non-residential uses, lower residential densities, or residential uses at affordability levels higher than anticipated by the Housing Element. To avoid noncompliance, HCD advises communities to “buffer” their assigned RHNA numbers. The Site Inventory includes 48 sites in order to have enough capacity for the RHNA and recommended buffer of at least 15 percent. These sites, in addition to Accessory Dwelling Unit (ADU) Projections, Senate Bill (SB) 9 Projections, and Pipeline Projects have a total capacity of 2,312 units (1,993 units plus a 16 percent buffer).

Overview of Selected Sites
This section provides information on the current list of potential sites that show how the Town will accommodate the State’s required minimum of 1,993 housing units. Please note that the site numbers listed here are added only as a way to reference the site and label it on a map. The site number is not an indication of preference or priority. Figure D-1 shows an overview of the potential sites inventory map developed for Los Gatos’ 6th cycle Housing Element Update. The following sites make up the Site Inventory, which is available as Appendix H.

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-3
Figure D-1 Overall Area Parcel Locations
Sites Details
This section provides information on each of the sites selected for inclusion in the site inventory of vacant and available sites.

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Figure D-2 Downtown Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-5
Site A-1 Park Avenue
Addresses: 50 Park Avenue and 61 Montebello Way
Number of Housing Units: 5
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Park Avenue Site (A-1) is located in the Downtown Area on the southwest end of Town on a wooded parcel that is currently identified as Very High Fire Risk. The site is triangular in shape with parking lots and South Santa Cruz Avenue on one side, Highway 17 on a second side, and Downtown Los Gatos forming the third side. Proximity to Downtown Los Gatos ensures that this site provides pedestrian access to urban services. This site currently is developed with residential units and is designated Medium Density Residential. The site is zoned R-1D and would allow five housing units developed at a minimum density of five du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Very high fire hazard; existing residential dwelling units would require demolition.

Figure D-3 Park Avenue (Site A-1)

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Site A-2 South Santa Cruz Avenue
Address: 101 South Santa Cruz Avenue
Number of Housing Units: 16
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The South Santa Cruz Avenue Site (A-2) is located in the Downtown Area on the southwest end of Town along South Santa Cruz Avenue on an occupied commercial parcel in Downtown Los Gatos. The site is currently identified as Medium Density Residential. Proximity To Downtown Los Gatos ensures that this site provides pedestrian access to urban services. This site is designated as Central Business District and zoned C-2, which would allow 16 housing units developed at a minimum density of 20 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Very high fire hazard; the existing commercial use would require demolition.

Figure D-4 South Santa Cruz Avenue (Site A-2)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-7
Site A-3 University Avenue
Address: 165 Los Gatos-Saratoga Road
Number of Housing Units: 7
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The University Avenue Site (A-3) is located in the Downtown Area at the corner of Los Gatos-Saratoga Road and University Avenue on an occupied commercial site. Proximity to Downtown Los Gatos ensures that this site would provide pedestrian access to urban services.

This site is designated as Central Business District and zoned C-2, which would allow seven housing units developed at a minimum density of 20 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial building would require demolition.

Figure D-5 University Avenue (Site A-3)

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Figure D-6 Los Gatos Lodge Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-9
Site B-1 Los Gatos Lodge
Address: 50 Los Gatos-Saratoga Road
Number of Housing Units: 264
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Lodge Site (B-1) is located in the Los Gatos Lodge Area immediately adjacent to the interchange of Highway 9 and Highway 17, east of Downtown Los Gatos. The site is the current location of the Los Gatos Lodge, with the Los Gatos High School sports fields to the south, lower-density residential uses across Bella Vista Avenue to the east, and Best Western Inn across Highway 9 on the north. This site is designated as Mixed-Use Commercial and zoned CH:PD, which would allow 264 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial buildings would require demolition and removal or modification of the existing Planned Development Overlay to accommodate residential.

Figure D-7 Los Gatos Lodge (Site B-1)

HCD Draft Initial Review 2023-2031 Housing Element
D-10 Appendix D October 2022
Figure D-8 Los Gatos Boulevard Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-11
Site C-1 Ace Hardware
Address: 15300 Los Gatos Boulevard
Number of Housing Units: 48
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Ace Hardware Site (C-1) is located in the Los Gatos Boulevard Area on the east side of Los Gatos Boulevard and north of Gateway Drive. The site is the current location of Ace Hardware, with commercial uses to the north, south, and west, and lower-density residential uses to the east. The site is designated as Mixed-Use Commercial and zoned C-1, which would accommodate 48 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial building would require demolition.

Figure D-9 Ace Hardware (Site C-1)

HCD Draft Initial Review 2023-2031 Housing Element
D-12 Appendix D October 2022
Site C-2 Los Gatos Boulevard
Address: 15349, 15367, and 15405 Los Gatos Boulevard
Number of Housing Units: 86
“By Right” + 20% Affordable: Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-2) is located in the Los Gatos Boulevard Area on the west side of Los Gatos Boulevard, and south of Garden Lane. The site is the current location of multiple commercial uses, with commercial uses to the north, south, and east, and lowerdensity residential uses to the west. The site is designated as Mixed-Use Commercial and zoned CH, which would accommodate 86 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial building would require demolition.

Figure D-10 Los Gatos Boulevard (Site C-2)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-13
Site C-3 Los Gatos Boulevard
Address: 15425 Los Gatos Boulevard
Number of Housing Units: 33
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-3) is located in the Los Gatos Boulevard Area on the west side of Los Gatos Boulevard and east of Garden Lane. The site is the current location of office and commerical uses, with commercial uses located on all sides. The site is designated as Mixed-Use Commercial and zoned CH, which would accommodate 33 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial building would require demolition.

Figure D-11 Los Gatos Boulevard (Site C-3)

HCD Draft Initial Review 2023-2031 Housing Element
D-14 Appendix D October 2022
Site C-4 Affordable Treasures
Address: 15795 Los Gatos Boulevard
Number of Housing Units: 19
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Affordable Treasures Site (C-4) is located in the Los Gatos Boulevard Area at the northwest corner of Los Gatos Boulevard and Farley Lane. The site is the current location of Affordable Treasures Party Store with commercial uses located to the north, south, and east and lower-density residential uses located to the west. The site is designated as Mixed-Use Commercial and zoned CH, which would accommodate 19 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing commercial building would require demolition.

Figure D-12 Affordable Treasures (Site C-4)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-15
Site C-5 Los Gatos Boulevard
Address: 16203 Los Gatos Boulevard
Number of Housing Units: 24
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-5) is located in the Los Gatos Boulevard Area at the northwest corner of Los Gatos Boulevard and Roberts Road. The site is the current location of NC Boardshop skateboard shop and Autobahn Los Gatos, with commercial uses located to the north, east, and west and medium-density residential uses located to the south. The site is designated as Mixed-Use Commercial and zoned CH, which would accommodate 24 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, a Conceptual Development Advisory Committee application for a mixed-use development was submitted on November 17, 2020 pending an anticipated density increase as part of the General Plan and Housing Element Updates.

Constraints: Existing commercial buildings would require demolition.

Figure D-13 Los Gatos Boulevard (Site C-5)

HCD Draft Initial Review 2023-2031 Housing Element
D-16 Appendix D October 2022
Site C-6 Los Gatos Boulevard
Address: 16492 Los Gatos Boulevard and Assessor Parcel Number 537-02-86 Number of Housing Units: 6
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-6) is located in the Los Gatos Boulevard Area on the east side of Los Gatos Boulevard, north of Spencer Avenue. The site is the current location of LG Wines and Liquors and Happy Cleaners, with commercial uses located to the north, south, and west and low-density residential uses located to the east. The site is designated as Low Density Residential but zoned C-1, which would accommodate 6 housing units developed at a minimum density of 10 du/ac.

Property Owner Interest Form Submitted: Yes, and the owner has submitted written interest in changing the land use designation to Neighborhood Commercial.

Constraints: Existing commercial building would require demolition.

Figure D-14 Los Gatos Boulevard (Site C-6)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-17
Site C-7 Los Gatos Boulevard
Address: 15495 Los Gatos Boulevard
Number of Housing Units: 116
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-7) is located in the Los Gatos Boulevard Area on the west side of Los Gatos Boulevard and east of Garden Lane. The site is comprised of three separate commercial buildings, with commercial uses located to the north, south, and east. Lowdensity residential uses are located to the west. The site is designated as Mixed- Use Commercial but zoned CH, which would accommodate 116 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, a property owner has contacted staff with an inquiry for residential development of the site.

Constraints: Existing commercial buildings would require demolition.

Figure D-15 Los Gatos Boulevard (Site C-7)

HCD Draft Initial Review 2023-2031 Housing Element
D-18 Appendix D October 2022
Site C-8 Los Gatos Boulevard
Address: 15445 Los Gatos Boulevard
Number of Housing Units: 46
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos Boulevard Site (C-8) is located in the Los Gatos Boulevard Area on the west side of Los Gatos Boulevard and east of Garden Lane. The site is the current location of Virtus Performance Club, with commercial uses located to the east and south. Low-density residential uses are located to the north and west. The site is designated as Mixed-Use Commercial but zoned CH, which would accommodate 46 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the site is adjacent to other sites within the Site Inventory.

Constraints: Existing commercial building would require demolition.

Figure D-16 Los Gatos Boulevard (Site C-8)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-19
Figure D-17 North Forty Area

HCD Draft Initial Review 2023-2031 Housing Element
D-20 Appendix D October 2022
Site D-1 North Forty Phase II
Address: 14859 Los Gatos Boulevard, et. al.

Number of Housing Units: 461
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-1) is located in the North Forty Area on the west side of Los Gatos Boulevard, south of Burton Road. The site contains existing single-family residences and agriculture uses. Commercial uses are located to the south and west and arterial highways located to the north and east. The site is designated and zoned as North Forty Specific Plan, which would accommodate 461 units at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the property owner has been involved in attending Housing Element Advisory Board (HEAB) meetings and submitted written public comments regarding intent and interest in residential development on the site.

Constraints: Existing buildings would require demolition.

Figure D-18 North Forty Phase II (Site D-1)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-21
Site D-2 North Forty Phase II
Address: 16245 Burton Road
Number of Housing Units: 38
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-2) is located in the North Forty Area at the terminus of Burton Road, on the west side of Los Gatos Boulevard. The site is underutilized with a single-family residence. Commercial uses are located to the east and arterial highways located to the north and west. The site is designated and zoned as North Forty Specific Plan, which would accommodate 38 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-19 North Forty Phase II (Site D-2)

HCD Draft Initial Review 2023-2031 Housing Element
D-22 Appendix D October 2022
Site D-3 North Forty (Phase II)
Address: 16240 Burton Road
Number of Housing Units: Eight
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-3) is located in the North Forty Area along Burton Road and adjacent to the Highway 17/Highway 85 interchange. The site contains a single-family residence. Other North Forty Specific Plan properties surround the site. The site is designated and zoned as North Forty Specific Plan, which would accommodate eight housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-20 North Forty Phase II (Site D-3)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-23
Site D-4 North Forty Phase II
Address: 16270 Burton Road
Number of Housing Units: 13
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-4) is located in the North Forty Area at the end of Burton Road and immediately adjacent to the Highway 17/Highway 85 interchange. The site contains a single-family residence. Other North Forty Specific Plan properties surround the site.

The site is designated and zoned as North Forty Specific Plan, which would accommodate 13 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-21 North Forty Phase II (Site D-4)

HCD Draft Initial Review 2023-2031 Housing Element
D-24 Appendix D October 2022
Site D-5 North Forty Phase II
Address: 16210 Burton Road
Number of Housing Units: 25
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-5) is located in the North Forty Area along Burton Road and on the west side of Los Gatos Boulevard. The site contains single-family residences.

Other North Forty Specific Plan properties surround the site. The site is designated and zoned as North Forty Specific Plan, which would accommodate 25 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-22 North Forty Phase II (Site D-5)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-25
Site D-6 North Forty Phase II
Address: 14849 Los Gatos Boulevard
Number of Housing Units: 28
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-6) is located in the North Forty Area on the west side of Los Gatos Boulevard, south of Burton Road. The site contains a single-family residence.

Other North Forty Specific Plan properties surround the site on the north, south, and west. East of the site, across Los Gatos Boulevard there are commercial uses. The site is designated and zoned as North Forty Specific Plan, which would accommodate 28 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-23 North Forty Phase II (Site D-6)

HCD Draft Initial Review 2023-2031 Housing Element
D-26 Appendix D October 2022
Site D-7 North Forty Phase II
Address: 14823 Los Gatos Boulevard
Number of Housing Units: 11
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The North Forty Phase II Site (D-7) is located in the North Forty Area at the southwest corner of Burton Road and Los Gatos Boulevard. The site contains a single-family residence. Other North Forty Specific Plan properties surround the site on the south and west.

North of the site, across Burton Road, and east of the site, across Los Gatos Boulevard, there are commercial uses. The site is designated and zoned as North Forty Specific Plan, which would accommodate 11 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the parcel is located within Phase II of the North 40 Specific Plan Area where recent significant housing development is underway.

Constraints: Existing residential building would require demolition.

Figure D-24 North Forty Phase II (Site D-7)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-27
Figure D-25 Lark Avenue Area

HCD Draft Initial Review 2023-2031 Housing Element
D-28 Appendix D October 2022
Site E-1 Oka Road
Address: Oka Road
Number of Housing Units: 124
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The Oka Road Site (E-1) is located in the Lark Avenue Area on the east side of Oka Road, north of Lark Avenue. The site contains residential and agricultural uses. Major arterial highways are located north and east of the site, with the Los Gatos Swim and Racquet Club immediately north. Agricultural and commercial uses are located across Oka Road. The site is designated as Low-Density Residential and Medium-Density Residential. Parcels within the site are zoned R-1-8 and R-M:5-12, which would allow 124 housing units developed at a typical density of four du/ac for parcels designated as Low-Density Residential and at a typical minimum of 14 du/ac for parcels designated as Medium-Density Residential.

Property Owner Interest Form Submitted: No; however the property owner has submitted a public comment to the HEAB regarding future development of the site.

Constraints: Existing buildings would require demolition.

Figure D-26 Lark Avenue (Site E-1)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-29
Site E-2 Oka Lane
Address: Oka Lane
Number of Housing Units: 26
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The Oka Lane Site (E-2) is located in the Lark Avenue Area on the west side of Oka Road, north of Lark Avenue. The site contains agricultural uses. Major arterial highways are located north and east of the site, with the Bonnie View mobile home park to the north.

Agricultural and commercial uses are located across Oka Road. The site is designated as LowDensity Residential. The site is zoned R-1:8, which would allow 26 housing units developed at a typical density of 4 du/ac.

Property Owner Interest Form Submitted: No; however the property owner has submitted a public comment to the HEAB regarding future development of the site.

Constraints: Proximity to adjacent highways.

Figure D-27 Oka Lane (Site E-2)

HCD Draft Initial Review 2023-2031 Housing Element
D-30 Appendix D October 2022
Site E-3 Caltrans Right of Way
Address: Caltrans Right of Way
Number of Housing Units: 69
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Caltrans Right of Way Site (E-3) is located in the Lark Avenue Area south and west of the Highway 17/Highway 85 interchange. The site is currently vacant. Major arterial highways are located north and east of the site. Commercial uses are located west of the site across Oka Road, and the Bonnie View mobile home park is located immediately south of the site. Should the site be annexed by the Town, it is designated as Medium-Density Residential and zoned as R-M:5-12, which would accommodate 69 housing units developed at a minimum density of 14 du/ac.

Property Owner Interest Form Submitted: No, the Town has yet to reach out to Caltrans regarding future development of the site.

Constraints: Consultation with Caltrans for future development.

Figure D-28 Caltrans Right of Way (Site E-3)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-31
Figure D-29 Winchester Boulevard Area

HCD Draft Initial Review 2023-2031 Housing Element
D-32 Appendix D October 2022
Site F-1 Knowles Drive
Address: 110 Knowles Drive
Number of Housing Units: 220
“By Right” + 20% Affordable: Required – Used in previous cycle.

Description: The Knowles Drive Site (F-1) is located in the Winchester Boulevard Area north and west of the Highway 17/Highway 85 interchange. The site contains industrial uses. Los Gatos Creek is immediately south and east of the site, with low-density residential uses located beyond.

High-density residential uses are located south and west of the site. Commercial/industrial uses are located north of the site across Knowles Drive. The site is designated as High-Density Residential and zoned CM:AHOZ, which would accommodate 220 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however the site is located within the Affordable Housing Overlay Zone.

Constraints: Existing buildings would require demolition and adjacency to the Los Gatos Creek Trail.

Figure D-30 Knowles Drive (Site F-1)

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-33
Site F-2 Winchester Boulevard
Address: 206 Knowles Drive
Number of Housing Units: 72
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Winchester Boulevard Site (F-2) is located in the Winchester Boulevard Area at the northeast intersection of A Street and Knowles Drive. The site contains office uses. Multifamily residential is located to the south and office uses are located to the north, south, and west of the site. The site is designated as High-Density Residential and zoned CM, which would accommodate 72 housing units developed at a minimum density of 30 du/ac.

Property Owner Interest Form Submitted: No; however, the site is located immediately adjacent to 110 Knowles Drive (Site F-1), which has an Affordable Housing Overlay Zone.

Constraints: Existing buildings would require demolition and adjacency to the Los Gatos Creek Trail.

Figure D-31 Winchester Boulevard (Site F-2)

HCD Draft Initial Review 2023-2031 Housing Element
D-34 Appendix D October 2022
Figure D-32 Union Avenue Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-35
Site G-1 Los Gatos-Almaden Road
Address: 440 Los Gatos Almaden Road
Number of Housing Units: 8
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Los Gatos-Almaden Road Site (G-1) is located in the Union Avenue Area at the northwest corner of Leigh Avenue and Los Gatos-Almaden Road. The site contains a gas station and commercial building. Low-density residential are located north, south, and west of the site.

Leigh High School is located east of the site across Leigh Avenue. The site is designated as Neighborhood Commercial and zoned C-1, which would accommodate 8 housing units developed at a minimum density of 10du/ac.

Property Owner Interest Form Submitted: Yes
Constraints: Existing gas station and commercial building would require demolition.

Figure D-33 Los Gatos-Almaden Road (Site G-1)

HCD Draft Initial Review 2023-2031 Housing Element
D-36 Appendix D October 2022
Figure D-34 Harwood Road Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-37
Site H-1 Valero
Address: 14000 Blossom Hill Road
Number of Housing Units: 7
“By Right” + 20% Affordable: Not Required – Not used in previous cycle Property Owner Interest Form Submitted:

Description: The Valero Site (H-1) is located in the Harwood Road Area at the southwest corner of Blossom Hill Road and Harwood Road. The site contains a gas station. Low-density residential are located north, south, and east of the site. Commercial uses are located immediately west of the site. The site is designated as Neighborhood Commercial and zoned C1, which would accommodate 7 housing units developed at a minimum density of 10 du/ac.

Property Owner Interest Form Submitted: Yes.

Constraints: Existing gas station and commercial building would require demolition.

Figure D-35 Valero (Site H-1)

HCD Draft Initial Review 2023-2031 Housing Element
D-38 Appendix D October 2022
Figure D-36 Alberto Way Area

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-39
Site I-1 Alberto Way
Address: 401-409 Alberto Way
Number of Housing Units: 60
“By Right” + 20% Affordable: Not Required – Not used in previous cycle.

Description: The Alberto Way Site (I-1) is located in the Alberto Way Area, located at the intersection of Alberto Way and Los Gatos-Saratoga Road. The site is currently vacant. Multifamily residential are located north and east of the site. Commercial uses are located immediately south and east of the site with Highway 17 to the west. The site is designated as Mixed Use Commercial and zoned CH, which would accommodate 60 housing units developed at a density of 27 du/ac based on a preliminary development application that has been submitted to the Town and is still under review.

Property Owner Interest Form Submitted: Yes.

Constraints: Proximity to adjacent Highway 17 onramp.

Figure D-37 Alberto Way (Site I-1)
Accessory Dwelling Unit (ADUs and Junior ADUs) Projections Address: Various Locations

HCD Draft Initial Review 2023-2031 Housing Element
D-40 Appendix D October 2022
Number of Housing Units: 200
“By Right” + 20% Affordable: Not required, instead a formula exists for projecting the next eight-year cycle, along with assumptions of 30 percent very-low income units, 30 percent low income units, 30 percent moderate income units, and 10 percent above moderate categories.

Description: Accessory dwelling units according to ADU Ordinance.

Constraints: To have HCD consider 200 units as a reasonable expectation for construction in this eight-year cycle, the Town is reliant upon the averaging of previous ADU permit submittals.

Senate Bill 9 (SB 9) Projections
Address: Various Locations
Minimum Number of Housing Units: 96
“By Right” + 20% Affordable: Not required – Instead, formula exists for projecting the next eight-year cycle.

Description: New housing units generated from the SB 9 Ordinance.

Constraints: To have HCD consider SB 9 units as a reasonable expectation for construction in this eight-year cycle, the Town is reliant upon the averaging of previous SB 9 permit submittals.

Pipeline Projects
Address: Addresses listed below:
105 Newell Avenue – net four units
20101 Foster Road – net one unit
North Forty Phase I – net 14 units
465 North Santa Cruz Avenue – net one unit
16195 George Street – net three units
144 Wood Road – net one unit
16100 Greenridge Terrace – net seven units
15215 Shannon Road – net four units
17200 Los Robles – net two units
400 Surmont Drive – net two units
14915 Shannon Road – net 10 units
16220 Hardwood – net two units
14926 Los Gatos Boulevard – net five units
15415 National Avenue – net one unit
45 Reservoir Road – net one unit
200 Happy Acres – net one unit
15343 Santella Court – net one units
15415 Santella Court – net one unit
15365 Santella Court – net one unit
15860 Winchester Boulevard – net 113 units
120 Oak Meadow Drive – net one unit
Number of Housing Units: 176
“By Right” + 20% Affordable: Not required
Description: New housing units generated from projects with Planning entitlements and Planning applications currently under Town review.

Constraints: None
Inventory of Vacant and Available Sites
This section provides the formal inventory of sites that the Town of Los Gatos will rely on in the 6th Housing Element planning cycle. Per State law and Housing Policy, the Town is required to maintain “no net loss” of the

Appendix D. Site Inventory Analysis
October 2022 Appendix D D-41
housing capacity represented by this list of parcels and the sites they comprise. To facilitate this, the inventory presented in Appendix H has been designed with excess capacity. This allows some degree of flexibility in decision making for individual development projects as they come forward for approval.

In short, with some limited flexibility, the Town is committed to permitting housing on each of the parcels listed in the table below, and in so doing ensuring that the number of units listed for each parcel in the table "planned capacity” is achieved. Should the Town approve development that is inconsistent with the parcel’s planned capacity, it is then required as part of that approval to:

1. Find, based on quantitative evidence, that the remaining inventory of housing sites is still sufficient to meet the Town’s 6th cycle RHNA; or

2. Identify one or more available sites with the realistic development capacity to replace the housing that would have otherwise been developed had consistency with planned capacity been achieved.

Appendix H provides details and capacity estimates for each of the parcels that comprise the Site Inventory as identified in the section above.

D. 4 Summary and Conclusions
The sites identified in this report are sufficient to accommodate Los Gatos’ Regional Housing Needs Allocation for the 6th cycle planning period. This number accommodates a buffer of approximately 16 percent above RHNA, which would equal capacity of approximately 319 additional units. These sites, in addition to Accessory Dwelling Units Projections, Senate Bill 9 Projections, and Pipeline Projects have a total capacity of 2,312 units. This “cushion” for capacity above the base RHNA number is highly recommended because of the State’s no-net-loss policy, which precludes jurisdictions from approving development that results in an overall housing site deficit.

The “cushion” essentially provides a degree of flexibility for policy makers as they make development decisions.

Many of the sites identified in this report have existing uses that would need to be demolished before new housing could be constructed.

For communities like Los Gatos that are largely built out and surrounded by other communities and undevelopable hillsides, redevelopment and densification is the only practical solution to providing a fair share of future housing for the San Francisco Bay Area. By its nature, such redevelopment is more costly and more time consuming than building new units on vacant land. To offset these constraints, higher densities are proposed in some areas. These higher densities act as a market incentive to offset the added cost and time required build new housing on redeveloped sites. Property owner interest will be pivotal for facilitating single-family site opportunities to add housing through construction of ADUs and use of SB 9 processes, which allow for up to four units on a property zoned for a single house

Review of Previous Housing Element E

APPENDIX

Appendix E. Review of Previous Housing Element
October 2022 Appendix E E-1
E.1 Introduction
In order to effectively plan for the future, it is important to reflect back on the goals of the previous Housing Element and to identify those areas where progress was made and those areas where continued effort is needed.

State Housing Element guidelines require communities to evaluate their previous Housing Element according to the following criteria:
 Effectiveness of the Element.
 Progress on Implementation.
 Appropriateness in Goals, Objectives, and Policies.

E.2 Effectiveness of the Element
The Town of Los Gatos’ 2015 Housing Element identified the following goals:
 Expand the choice of housing opportunities for all economic segments of the community by supporting the development of affordable housing in a variety of types and sizes, including a mixture of ownership and rental housing.
 Maintain and/or adopt appropriate land use regulations and other development tools to encourage the development of affordable housing that is compatible with the neighborhood and the community.  Preserve existing residential opportunities, including the existing affordable housing stock.  Ensure that all persons have equal access to housing opportunities.  Retain and expand affordable housing opportunities for seniors.  Mitigate Town governmental constraints to affordable and special needs housing development.  Encourage residential construction that promotes green building and energy conservation practices.  Ensure that the Town has sufficient resources and takes appropriate measures to implement the Housing Element.
 Maintain the Town’s 2005 jobs-to-household ratio of 1.5 jobs per household.

In order to achieve these goals, the 2015 Housing Element listed a series of policies and programs. The policies covered a range of housing concerns, including appropriate zoning for lower and moderate-income households, assisting in developing affordable housing, removing governmental constraints, conserving the existing affordable housing stock, preventing the conversion of affordable units to market rate, and promoting equal housing opportunities for all persons. The policies comply with State housing law guidelines.

HCD Draft Initial Review 2023-2031 Housing Element
E-2 Appendix E October 2022
E.3 Progress on Implementation
To assess the Town’s progress on implementing the 2015 Housing Element, the following key areas were reviewed:
 Adopted Programs;
 Production of Housing;
 Preservation of “At Risk” Units; and
 Rehabilitation of Existing Units.

Each of these areas is discussed in detail below.

Overview of Adopted Programs
Table E-1 below identifies all of the actions the Town committed to in the 2015 Housing Element. The table also includes a description of the progress that was made during the 2015 to 2023 planning period.

Appendix E. Review of Previous Housing Element
October 2022 Appendix E E-3
Table E-1 Overview of Adopted Programs
No.

Programs
(The text provided in this column is a synopsis only; for complete program language refer to the 2015 Housing Element)
Achievements/Effectiveness Continue/Modify/
Delete
Goal
HOU-1
Expand the choice of housing opportunities for all economic segments of the community by supporting the development of affordable housing in a variety of types and sizes, including a mixture of ownership and rental housing. Modify Policy
HOU-1.1 Develop and utilize all available housing funding resources in order to provide the maximum amount of affordable housing as feasible. Modify Policy
HOU-1.2 Work with nonprofit agencies and housing developers to plan and develop a mix of affordable housing opportunities in Los Gatos. Modify Actions

1.1 Continue to implement the Below Market Price (BMP) program and evaluate it annually to ensure it is not a constraint to development.

BMP Program is implemented on all residential
projects that meet the criteria. Modify

1.2 Amend the Town Code to allow new deed restricted Accessory Dwelling Units (ADU) to be affordable to lower income households on non-conforming residential lots over 10,000 square feet and in the Hillside Residential Zone on sites that are larger than 5 acres.

Town Code has been amended to address this. Modify

1.3 Continue to provide up to a 100 percent density bonus for developments that include housing for elderly, handicapped, and/or very low and low-income households.

This is an incentive that is provided to projects
that meet the criteria. Modify

1.4 Using BMP in-lieu fees, implement the proposed programs and initiatives of the Town’s Affordable Housing Strategies to increase and preserve affordable housing, such as purchasing affordability covenants in existing apartments.

Use of BMP in-lieu fees will be considered as
opportunities arise. Modify

1.5 Hold a periodic outreach meeting with affordable housing developers to discuss the development of housing affordable to extremely low-income households.

The Town will consider incentives when projects
of this nature are proposed. Modify

1.6 Encourage the creation of housing that is affordable to extremely low-income households by considering allocating a percentage of the Town’s Affordable Housing (Below Market Price) fund to subsidize housing for extremely low-income households.

Use of BMP in-lieu fees will be considered as
opportunities arise. Modify

1.7 The Town will rezone 13.5 acres within the North 40 Specific Plan area within three years of Housing Element adoption at minimum a density of 20 dwelling units per acre to facilitate affordable housing production.

Complete Delete

HCD Draft Initial Review 2023-2031 Housing Element
E-4 Appendix E October 2022
No.

Programs
(The text provided in this column is a synopsis only; for complete program language refer to the 2015 Housing Element)
Achievements/Effectiveness Continue/Modify/
Delete

1.8 To assist the development of housing for lower income households on sites larger than ten acres, the Town will facilitate land divisions and lot line adjustments to result in parcels sizes between one to ten acres that facilitate multiple-family developments affordable to lower income households in light of state, federal and local financing programs.

Projects are given priority. Continue
Goal
HOU-2
Maintain and/or adopt appropriate land use regulations and other development tools to encourage the development of affordable housing that is compatible with the neighborhood and the community. Modify Policy
HOU-2.1
Continue to designate sufficient, residentially zoned land at appropriate densities to provide adequate sites to accommodate Los Gatos’s RHNA for 2015–2023. Continue
Policy
HOU-2.2
Ensure that the Town will provide sufficient land at appropriate zoning categories to meet its RHNA for very low-, and moderateincome households, as demonstrated in the Housing Sites Inventory analysis in Chapter 6 of the Housing Element Technical Appendix. Modify Policy
HOU-2.3
Encourage mixed–use developments that provide affordable housing close to employment centers and/or transportation facilities, particularly along Los Gatos Boulevard and within a ½-mile radius of the future Vasona light rail station. Modify Policy
HOU-2.4
Demonstrate that all new residential development is sufficiently served by public services and facilities, including pedestrian and vehicular circulation, water and wastewater services, police, fire, schools, and parks. Continue Policy
HOU-2.5 New single-family, multi-family, and mixed-use developments shall be compatible with the character of the surrounding neighborhood. Modify Policy
HOU-2.6 Strive to ensure that at least 30 percent of the housing stock is rental units. Modify Policy
HOU-2.7 Create new affordable housing opportunities through acquisition using Affordable Housing Funds. Delete Actions

2.1 Continue to implement the minimum density and affordable housing incentives within the AHOZ
This will be implemented when a project in the
AHOZ is considered. Modify

2.2 For multiple-family residential development within the North 40 and the Southbay AHOZ site, subject to by right development, the Town will amend the Town Code to add by right development findings.

This has not yet been completed. Modify

2.3 The Town Code (Zoning Regulations) will be amended to clarify that Transitional and Supportive Housing is permitted in all residential zones by right.

The Town will comply with State Law and SB 743 if
a project is proposed before the Town Code is
amended.

Delete

Appendix E. Review of Previous Housing Element
October 2022 Appendix E E-5
No.

Programs
(The text provided in this column is a synopsis only; for complete program language refer to the 2015 Housing Element)
Achievements/Effectiveness Continue/Modify/
Delete

2.4 For multiple family residential development within the North 40 and the Southbay AHOZ site subject to by right development, the Town will amend the Town Code to add by right development findings.

This has not yet been completed.

Modify

2.5 To ensure adequate residential capacity to accommodate the RHNA for each income category, the Town will develop and implement an ongoing formal evaluation procedure (project-by-project) of sites identified in the Sites Inventory.

If this situation arises the Town will comply with
this requirement. Modify
Goal
HOU-3 Preserve existing residential opportunities, including the existing affordable housing stock. Modify Policy
HOU-3.1 Encourage the maintenance and improvement of existing housing units. Modify Policy
HOU-3.2
Support the preservation and conservation of existing housing units that provide affordable housing opportunities for Town residents and workers. Modify
Policy
HOU-3.3 Improve the quality of rental housing by acquisition and/or rehabilitation using Affordable Housing Fund. Modify Policy
HOU-3.4
Preserve the affordability of units affordable to very low-, low-, and moderate-income households in Bonnie View Park, and enforce zoning regulations regarding conversion of mobile home parks in Los Gatos. Continue Actions

3.1 Continue to monitor affordable, multi-family housing units in the Town to ensure that they retain their affordability status.

No units have been converted to market rate
rents.

Continue

3.2 The Town will continue to implement Section 29.20.155 of the Town Code that addresses conversions of residential use, specifically Section 29.20.155(a)(2) that requires that any proposed conversion satisfy the housing goals and policies as set forth in the General Plan.

This will be considered if a conversion of
residential uses is proposed. Continue

3.3 Continue to participate in the County of Santa Clara Community Development Block Grant Joint Powers Authority so Town residents can participate in County CDBG Housing Rehabilitation programs.

The Town still participates in these programs. Continue

3.4 Continue to support countywide programs that provide assistance with minor home repairs and accessibility improvements for lower-income households, including special needs households.

The Town supports these programs. Continue
Goal
HOU-4 Ensure that all persons have equal access to housing opportunities.

Policy
HOU-4.1 Support housing programs that protect individuals’ rights. Modify