CITY OF PACIFICA
540 Crespi Drive • Pacifica, California 94044-3422
www.cityofpacifica.org
MAYOR
Tygarjas Bigstyck
MAYOR PRO TEM
Sue Vaterlaus
COUNCIL
Sue Beckmeyer
Mary Bier
Christine Boles
Scenic Pacifica
Incorporated Nov. 22, 1957
August 28, 2023
The Honorable Nancy L. Fineman
Judge of the Superior Court
c/o Bianca Fasuescu
Hall of Justice
400 County Center; 2nd Floor
Redwood City, CA 94063-1655
Subject: City of Pacifica’s response to the San Mateo County Civil Grand Jury Report – “Accessory Dwelling Units: Affordable Housing’s Panacea or Prevarication?” Dear Judge Fineman and Members of the Grand Jury:
Thank you for the opportunity to review and comment on the above-referenced Civil Grand Jury report filed on June 12, 2023. Pursuant to Penal Code § 933(c), the City of Pacifica’s response to the several findings and recommendations contained in the report are provided below. The Pacifica City Council, including the Mayor, reviewed and approved the responses at a public meeting on August 28, 2023.
Responses to Civil Grand Jury Findings:
F1. Due to recent changes in California ADU-related laws, local governments cannot condition ADU permits in San Mateo County on complying with affordability monitoring and verification.
Response to F1. The City agrees with the finding.
F2. San Mateo County and most of its municipalities rely on ADUs to meet their affordable housing commitments in their RHNA-6 plans.
Response to F2. The City partially disagrees with the finding. The City is required to plan for a regional housing needs allocation (RHNA) of 1,892 units. As proposed in the City’s draft Housing Element, the portion of the City’s RHNA that consists of ADUs is 187 units (9.9% of the RHNA), a relatively low share of total housing units. Of the 187 ADUs, 112 units or 60% are assumed to be affordable at very-low- and low-income levels. Specifically, the City has a total very-low and low-income housing RHNA of 848 units and ADUs would make up only 13% of that figure. While the City assumes ADUs will meet part of its affordable housing RHNA, they are only one of many strategies that the City will be utilizing.
Additionally, the City is proposing to develop the following strategies/programs as part of the City’s Housing Element update:
City of Pacifica’s response to the San Mateo County Civil Grand Jury Report – “Accessory Dwelling Units:
Affordable Housing’s Panacea or Prevarication?” | August 28, 2023 2 • Review zoning regulations and map to identify inconsistencies between the general plan densities and uses and the currently adopted zoning regulations and amend accordingly to resolve. Allows for increase density, which allow for housing that is naturally more affordable.
• Streamlined permitting processes for affordable housing. • Inclusionary zoning requirements that require a certain percentage of new units be rented affordably.
• City Council to evaluate potential of city-owned sites and seek affordable housing developer interest in conformance with any applicable Surplus Land Act requirements.
Furthermore, even without counting ADUs, the City would meet its lower income RHNA obligations. The City’s draft Housing Element includes a significant buffer of 30% additional units over the RHNA. At the lower income level, the buffer is 52%, with a plan for 1,289 lower income units. Subtracting the assumed 112 ADUs at lower income levels, the City would still exceed its lower income RHNA by 329 units. Therefore, Pacifica does not intend to rely on ADUs to meet its affordable housing commitments in its RHNA 6 Housing Element.
F3. Atherton, Hillsborough, Portola Valley, and Woodside rely on ADUs to meet as much as 80 percent of their affordable housing commitments in their RHNA-6 plans.
Response to F3. Not applicable: The City of Pacifica is not named in this finding and therefore has no comment.
F4. HCD has instructed San Mateo County jurisdictions to monitor and verify future ADU production and affordability every two years but has yet to specify how to verify whether very low-, low- or moderate-income households are occupying the ADUs as planned.
Response to F4. The City partially disagrees with this finding. Pacifica does not expect the California Department of Housing and Community Development (HCD) to specify how to verify the income levels of ADU occupants. Additionally, HCD only directs income verification at the initial time of occupancy. Nevertheless, the City is planning on supporting a regional ADU monitoring effort through the Association of Bay Area Governments (ABAG) or 21 Elements, a long standing collaboration among the 21 local jurisdictions of San Mateo County.
F5. Other than Brisbane and Redwood City, San Mateo County and its jurisdictions have yet to articulate how they will monitor and verify ADU production or affordability.
Response to F5. The City agrees with this finding. San Mateo County jurisdictions met on June 20, 2023 to discuss potential strategies for monitoring ADU affordability levels. The City is planning to support a regional ADU monitoring effort through ABAG or 21 Elements. We expect this monitoring effort to begin sometime in early 2025.
F6. Without effective ADU monitoring and verification, it will be impossible to evaluate whether the jurisdictions are meeting their RHNA-6 obligations for low-, very-low, and moderate-income housing units.
Response to F6. The City disagrees with this finding. As stated above, the City is planning to support a regional approach to monitoring ADU affordability. Furthermore, as demonstrated in City of Pacifica’s response to the San Mateo County Civil Grand Jury Report – “Accessory Dwelling Units:
Affordable Housing’s Panacea or Prevarication?” | August 28, 2023 3 the response to Finding 2, the City will not rely upon ADU construction to meet its RHNA obligation for lower income units. Therefore, the City can still fully meet its RHNA obligations for every affordability category without construction of any ADUs at the lower income levels.
F7. ADU affordability and occupancy could be monitored by agencies such as HIP Housing which has proven systems and processes to verify occupancy of deed-restricted rental properties in San Mateo County.
Response to F7. The City agrees with this finding. HIP Housing is one potential partner agency for ADU income/affordability monitoring.
Responses to Civil Grand Jury Recommendations:
R1. San Mateo County and each City should immediately stop using ADUs to meet their Statemandated very low-, low-, and moderate-income housing targets in their Housing Element submissions until they have also proposed an effective monitoring system that verifies how newly developed ADU’s will be used.
Response to R1. The recommendation will not be implemented because it is not warranted or is not reasonable. While the City shares the Civil Grand Jury’s goal to increase ADU affordability monitoring, the City intends to consider ADUs towards progress meeting its lower income RHNA allocation in accordance with guidance from HCD. The City’s draft Housing Element incorporates ADUs consistent with HCD’s guidelines based on actual ADU production in recent years and allocates income levels according to an allowable HCD methodology. Furthermore, as demonstrated in the response to Finding 2, the City does not rely upon ADU production to meet its lower income housing requirement. Therefore, it is neither warranted nor reasonable for the City to stop using ADUs in their draft Housing Element submissions.
The City is committed to following State housing law and to supporting the future development of an effective regional ADU monitoring program which will be operated by 21 Elements or ABAG. The City is also supporting the development of a new ADU nonprofit that will have programs to incentivize the production of affordable ADUs in San Mateo County. The City expects to have this monitoring program in place at some point in the future.
R2. By February 1, 2024, San Mateo County and each City should develop, adopt, and implement a verification system capable of monitoring and verifying how newly developed ADU’s are being used.
Response to R2. The recommendation will not be implemented because it is not warranted or is not reasonable. As noted in the response to Finding 2, the City does not rely upon ADU production to meet its lower income housing requirement. Therefore, this recommendation is not warranted. Mandated implementation of ADU affordability monitoring should only be required if ADUs were wholly or primarily being used to comply with Pacifica’s lower income RHNA requirement-which in this case they are not. Therefore, such a mandated implementation of an ADU affordability monitoring program would not be warranted.
Additionally, Pacifica does intend to verify ADU affordability at time of initial occupancy consistent with HCD guidance, and will partner with ABAG or 21 Elements to establish a regional monitoring program. As discussed above in Response to R1, the City is committed to supporting City of Pacifica’s response to the San Mateo County Civil Grand Jury Report – “Accessory Dwelling Units:
Affordable Housing’s Panacea or Prevarication?” | August 28, 2023 4 the future development of an effective regional ADU monitoring program which will be operated by 21 Elements or ABAG. The City is also supporting the development of a new ADU nonprofit that will have programs to incentivize the production of affordable ADUs in San Mateo County. However, such regional monitoring program cannot reasonably be implemented by February 1, 2024.
The regional monitoring is projected to launch in January 2025 and will likely survey people about their plans for their ADU at the time permits are issued. Due to homeowner privacy concerns and the cost of engaging thousands of homeowners every year, it would not be practical to have an ongoing verification system that checks the income of every resident of every ADU in the county.
R3. By February 1, 2024, San Mateo County and each City should develop and adopt incentives for ADU owners which could be offered in exchange for deed restrictions that would include requirements for ADU tenants to participate in independent monitoring.
Response to R3. This recommendation has yet to be implemented but will be implemented in the future. The City agrees with the goal of adopting an affordable ADU program. As discussed in the City’s Responses to R1 and R2, the City is actively involved in the potential creation of an ADU nonprofit to serve San Mateo County jurisdictions and 21 Elements, working on behalf of the City of Pacifica and other 21 Elements participating jurisdictions, has been researching best practices. The draft work plan for the nonprofit calls for it to offer programs to incentivize the production of affordable ADUs and support homeowners in constructing ADUs in exchange for agreeing to rent at affordable levels. The nonprofit is projected to launch in July 2024 and will be financially supported by San Mateo County jurisdictions as well as private philanthropy if possible. However, such regional monitoring program cannot reasonably be implemented by February 1, 2024.
R4. By February 1, 2024, San Mateo County and each City should track the intended use of ADUs – rented or non-rented – during the permitting process and offer incentives in exchange for deed restrictions that require ADUs to be used as rentals.
Response to R4. The recommendation requires further analysis. The City is committed to furthering the development of affordable housing. As discussed above, ADUs are assumed for a relatively small portion of the City’s housing allocation and would not be relied upon to meet the City’s lower income RHNA. Additionally, the City has finite resources available to conduct further efforts towards seeking affordable housing production and the City reserves the right to focus resources on efforts that will have the greatest impact within the law. The City will continue to work with HCD to finalize the draft Housing Element and as part of that effort, analyze and study the various options to monitor and incentivize all housing types such as ADUs to ensure consistency with HCD’s guidelines and requirements within the next six months.
R5. By April 1, 2024, San Mateo County and each City should develop and adopt a new ADU affordability distribution formula specific to each jurisdiction to the extent they are used for meeting the very low-, low-, and moderate-income housing requirements in their RHNA housing elements.
Response to R5. The recommendation will not be implemented because it is not warranted or is not reasonable. While Pacifica agrees with the importance of an accurate distribution formula, City of Pacifica’s response to the San Mateo County Civil Grand Jury Report – “Accessory Dwelling Units:
Affordable Housing’s Panacea or Prevarication?” | August 28, 2023 5 given the relative small size of the City, a more meaningful distribution formula can be attained by collecting data on ADUs constructed across all San Mateo County jurisdictions. The City is supporting the creation of an ADU monitoring program through 21 Elements or ABAG which will collect data that can be used to revise the distribution formula based on actual observed income levels. In the meantime, the City will continue to work with HCD to ensure compliance with required housing laws and if HCD recommends/accepts the affordability assumptions for ADUs as collected as part of the program, then the City will utilize those assumptions. The assumptions are based on a UC Berkeley study that surveyed thousands of homeowners statewide with repeat mailing and the data was aggregate to reduce the margin of errors. The margin of error would be too large if we are only surveying a dozen or couple of dozen households. There is also no evidence in the data to suggest significant variation from city to city. The recommendations of 30/30/30/10 (very low/low/moderate/above-moderate) had a significant cushion built in to ensure cities did not accidentally underproduce the amount of housing needed.
Therefore, since ADUs consist of a small portion of the City’s housing allocation and there are currently limited resources available to put towards housing, the City reserves the right to focus resources on efforts that will have the greatest impact, within the law.
R6. San Mateo County and each City should consider working together to address Recommendations 2 and 3.
Response to R6. This recommendation has been implemented. San Mateo County jurisdictions work collaboratively through 21 Elements to develop, adopt, and implement housing policies and programs in the county. San Mateo County jurisdictions are already working together to address recommendations 2 and 3.
Sincerely,
KEVIN WOODHOUSE
City Manager
cc: Pacifica City Council