City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Planning and Development Services
Meeting Date: March 11, 2024
Report #:2312-2341
TITLE
Authorize Transmittal of the 2023 Comprehensive Plan Annual Progress Report to the Office of Planning and Research and the 2023 Housing Element Annual Progress Report to the Department of Housing and Community Development.
RECOMMENDATION
The Planning and Transportation Commission and staff recommend City Council review the following State-mandated Annual Progress Reports and direct staff to submit them to the appropriate State authorities by April 1, 2024:
1. 2023 Comprehensive Plan Annual Progress Report (Attachment A) to the Office of Planning and Research (OPR); and
2. 2023 Housing Element Annual Progress Report (Attachments C and D) to the Department of Housing and Community Development (HCD).
EXECUTIVE SUMMARY
This report provides an update on the status of the 410 implementation programs contained in the Comprehensive Plan (Comp Plan) and the 122 implementation programs in the Council adopted 2023- 2031 Housing Element (HE), a chapter of the Comp Plan. The City is required to submit an annual progress report on the implementation progress of the Comp Plan and HE by April 1 every year.
The program statuses reflected in this report are as of December 31, 2023. There are 44 Comp Plan programs that had a status change in 2023, with 24 pending (paused/not started) programs moving to ongoing, partially complete, or complete status.
With the program status updates in 2023, a total of 314 (77%) of the 410 Comp Plan programs have been accomplished and are now complete and/or a part of ongoing operations. The remaining 23% of the programs, the partially complete and pending programs, still need to be addressed. See Attachment B for the list of remaining Comp Plan pending and partially complete Implementation Programs.
For the May 2023 adopted Housing Element, the City has made progress on the program implementation; please see Attachment C for more details. See discussion below for more information about the HE status.
On November 29, 2023, the Planning and Transportation Commission (PTC) reviewed the statuses of the Comp Plan and the HE implementation programs. The PTC raised few questions on statuses of some specific implementation programs and discussed their ability to reprioritize programs that they felt required to be changed from the 2017 Comp Plan designations.
BACKGROUND
This APR is for the sixth year of annual reporting since the adoption of the 2030 Comprehensive Plan in 2017 and for the first year of the 6th Cycle HE. The City Council reviewed the 2022 annual reports on March 2023 ( Staff Report) 1. The PTC reviewed the 2023 APRs on November 29, 2023 ( Staff Report) 2. The following section provides the context for the annual reporting. 2030 Comprehensive Plan Implementation Annual Progress Report The Annual Comprehensive Plan Implementation Report is a State mandated report, required by Government Code (GC) Section 65400 3, and submittal is due by April 1. It states that after a legislative body (City Council) adopts the Comprehensive Plan, an annual review must be submitted to the City Council, the Office of Planning and Research (OPR), and the Department of Housing and Community Development (HCD) on the status of the plan’s progress in implementing programs.
In addition, the Palo Alto Municipal Code ( Section 19.04.030) 4 requires the PTC to annually review the Implementation Plan table of the Comprehensive Plan. The code states that “the planning commission shall annually review the general plan and recommend to the city council such extensions, changes or additions to the plan as the commission may consider necessary in the view of any change in conditions.” 2023-2031 Housing Element Annual Progress Report
The HCD department requires an Annual Progress Report (APR) addressing the City’s progress in implementing the HE. The report is due by April 1. The report includes data on housing production and accomplishments toward the City’s Regional Housing Needs Allocation (RHNA) goals. The 2022 Housing Element Annual Progress Report was the last year of reporting on the implementation of the 5 th Cycle 1 City Council Staff Report (Item #5):
https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=1097 2PTC Staff Report, November 2023:
https://www.cityofpaloalto.org/files/assets/public/v/1/agendas-minutes-reports/agendas-minutes/planning-and- transportation-commission/2023/ptc-11.29-comp-plan-progress.pdf 3 Government Code Section 65400:
https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=GOV§ionNum=65400 4 Palo Alto Municipal Code Section 19.04.030:
https://codelibrary.amlegal.com/codes/paloalto/latest/paloalto_ca/0-0-0-82254#JD_19.04.030 2015-2023 Housing Element5 programs, as that HE term ended in January 2023. The 2022 HE APR can be found here. 6
The HE APR for 2023 reflects the first year of the 6th Cycle 2023-2031 Housing Element7 that was adopted by City Council on May 8, 2023 and submitted to HCD on June 7, 2023. The City received HCD comments on the adopted Housing Element and is preparing responses to those comments. The updated Housing Element may include additional program clarifications beyond what the Council previously adopted. The PTC and Council will review and take action to adopt the revised Housing Element in early 2024. The City aims for HCD certification of the new Housing Element in late Spring of 2024.
Although the City’s HE has not been certified by HCD, staff is preparing the 2023 HE APR following the standard requirements. HCD mandates that the APR for the Housing Element focus on three topics:
•Total number of net housing units produced or “permitted” by the City in a calendar year; •Status of jurisdiction’s progress in addressing its Regional Housing Needs Allocation (RHNA); and •Status of the implementation of the Housing Element’s programs and goals.
Planning and Transportation Commission Review
On November 29, 2023, the PTC reviewed the Comp Plan and the HE implementation programs. The PTC’s questions ranged from program specific status questions to broader issues like designated timeliness and priorities of the programs. The PTC discussed its ability to reprioritize programs that the commissioners felt required change from the 2017 Comp Plan designations. The PTC unanimously approved staff’s recommendation to take the year-end statuses of programs to City Council in early Spring.
The minutes for the November 29th PTC meeting are available here8.
ANALYSIS
This section provides an overview of the 2023 Comprehensive Plan APR and the Housing Element APR and provides high-level summaries of the related data. See Attachments A, C, and D for individual Comp Plan and HE program details and the City’s compliance with its Regional Housing Needs Allocation (RHNA). 5 2015-2023 Housing Element:
https://paloaltohousingelement.com/wp-content/uploads/2021/04/Certified-15-23-Housing-Element.pdf 6 2022 Housing Annual Progress Report:
https://www.cityofpaloalto.org/files/assets/public/v/1/planning-amp-development-services-1/housing- element/housingelement_2015_2023/submitted-hcd-paloalto-2021-apr_webposted.pdf 7 City Council Adopted Draft 2023-2031 Housing Element:
https://paloaltohousingelement.com/wp-content/uploads/2023/06/Palo-Alto-Housing-Element-2023- 2031_6.7.2.pdf
8 November 29th PTC Meeting Minutes:
https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Planning-and-Transportation- Commission-PTC/Current-PTC-Agendas-Minutes
Comprehensive Plan Implementation Programs Status
The Implementation Plan Table9 of the Comp Plan lists 410 programs the City undertook in 2017 to help achieve the goals in the Plan, with the available resources to the City. These programs are assigned to approximately 15 different lead departments. The programs were prioritized by the departments as actions to implement various aspects of the Comprehensive Plan goals and policies. Some programs were yearly budgeted and were ongoing, while the implementation of other programs require identification of resources during future budget cycles.
1. Implementation Status Summary
Table 1 below summarizes the year-end status for all the programs in 2023. The programs with “completed” and “ongoing” status reflect programs that have been implemented by the City, representing 77% of the programs. In 2023, there was a decrease in the number of “pending” status programs from the previous year, from 84 programs to 60, indicating progress on programs that were on hold or had not yet started. Also, the number of completed programs doubled from last year’s reporting.
There are 96 programs in the partially complete and pending status. The 36 partially complete programs have anticipated completion timelines for 2024 or 2025. The 60 pending programs, where work has not started or has been paused, have yet to be resourced. The list of these 96 programs is provided as Attachment B.
Of the 410 implementation programs, 44 (11%) had a change in status in 2023. Twenty-four programs changed status from pending to ongoing (11 programs), partially complete (12 programs), and complete (one program). The majority of these programs moved in a positive direction to reflect progress on the task; only one program shifted to a pending status, reflecting it was placed on hold. A few notable examples of programs with positive status changes include senior support programs, seismic retrofit incentives, noise ordinance evaluation, and parking reduction requirements for retail uses. 9 Comprehensive Plan Implementation Table:
https://www.cityofpaloalto.org/files/assets/public/v/2/planning-amp-development-services/3.-comprehensive- plan/comprehensive-plan/2030-comp-plan-9-implementation-june-21.pdf Table 1. Implementation Status of the Comprehensive Plan Programs Status Number of
Programs % of Total
Complete (100% completed) 13 3.17%
Ongoing (part of standard operations/implemented) 301 73.41% Partially Complete (work started) 36 8.78%
Pending (not started/paused) 60 14.63%
Total 410 100.00%
Status may change from one year’s Comp Plan Annual Implementation Review to the next years.
Source: City of Palo Alto, Planning and Development Services, 2023 December Status Notes: “Complete” - completed programs, “Ongoing” - programs are or have become routine operations, required for maintenance or implementation of required city regulations; this includes programs that were completed and shifted to ongoing status due to active implementation, “Partially Complete” - work for program has started and is in progress, and “Pending” - programs where implementation has stopped due to various reasons (e.g., lack of funding, shift in priorities, or insufficient staffing) or has not started.
2. Priority of Program/Timing
Priorities of the implementation programs were identified in 2017 when the Comp Plan was adopted. The prioritization guides the allocation of resources to implement the plan. It is not uncommon for priorities to shift over time depending on respective department resource availability. No change or shift in priorities were reported for this year. Table 2 summarizes the progress made on program implementation based on priority status.
Table 2. Implementation Status of the Comprehensive Plan Programs by Priority Status
Achieved / Done Not CompleteProgram Priority Number of
Programs
Complete Ongoing Partially
Complete Pending
Short Term
S - “Short-term” – programs planned
for implementation within the first five
years after Comprehensive Plan
adoption
99 (24%) 7 66 15 11
Short to Medium Term
S-M - "Short -term" to" Medium - term"
projects
1 (.24%) 1
Medium Term
M - “Medium-term” – typically means
programs that would be implemented
90 (23%) 2 45 14 29
or completed roughly within five to ten
years after Comprehensive Plan
adoption
Long Term
L - “Long-term” – programs that would
be implemented or completed more
than ten years after Comprehensive
Plan adoption
11 (3%) 1 6 4
Routine
R - “Routine” activities that are part of
the normal course of business for staff
163 (39%) 1 142 7 13
In Progress
IP - “In progress” – programs that were
already underway to complete a
specific, defined work effort at the time
of the Comprehensive Plan’s adoption
46 (11%) 2 42 2
Total Programs 410 13 301 36 60
Source: City of Palo Alto, Planning and Development Services, December 2023
3. Level of Effort
For each Comp Plan program, the level of effort for program implementation was determined. The effort reflects the magnitude and complexity of the program in terms of project size (e.g., small, medium, or large), required staffing, departmental involvement, and overall anticipatory cost. It is, however, difficult to determine and predict the exact cost of most of the programs, especially the long-term ones, and the specific staffing requirements needed to support the scope of future detailed work plans. The 2030 Comprehensive Plan’s Implementation Chapter uses the “$” symbol to reflect the level of effort; a single “$” reflects a low-level effort, “$$” is moderate-level effort, and “$$$” reflects a significant level of commitment to complete the program. Please refer to Attachment A for details.
Housing Element Implementation Programs Status
In 2023, staff remained focused on tasks associated with the 6th Cycle HE update process. The City Council adopted the 2023-2031 Housing Element on May 8, 2023. The City sent the adopted Housing Element to HCD for review on June 7, 2023.
On August 3, 2023, the City received a comment letter from HCD requesting modifications to the Housing Element prior to HCD certification. In particular, members of the public and HCD have called for additional analysis of the Sites Inventory to ensure and demonstrate that sites are viable for redevelopment during the 8-year planning cycle. To address these comments, staff and the Housing Element consultant are exploring changes to the Sites Inventory, including adding sites to the inventory and increasing densities.
In addition to comments received from HCD, the City has received and is responding public comments from local stakeholders. The updated version of the Housing Element will likely include updates to the Sites Inventory, modified programs, and analysis to demonstrate HCD compliance. As previously noted, the City anticipates adoption of a revised HE in early 2024.
The adopted HE has 122 programs that address a range of initiatives to support housing development in the City. At the end of 2023, seven months from adoption, some progress had been made on program implementation. One major milestone towards HE implementation is the December 18, 2023, City Council action to adopt the various code amendments that implement Programs 1.1A and 1.1B. These amendments address the requirements to make sites available for housing development to meet the City’s RHNA. The City Council also adopted an ordinance January 22, 2024 implementing Program 1.3 by creating by-right zoning approval for Housing Element opportunity sites used in prior Housing Elements.
These actions ensure that the City is in compliance with state requirements and mandated deadlines.
As noted above, the City expects to take action in early 2024 to adopt a revised HE that will have modified programs. Due to the required APR reporting timing (April 1), the 2023 HE APR reporting will be based on the May 2023 adopted HE programs. The list of the HE programs is provided in Attachment C. 2023 Achievements Towards 2023-2031 RHNA
For the 2023-2031 RHNA cycle, the City’s allocation is 6,086 units. In 2023, Palo Alto made progress toward its RHNA requirement by adding 159 Above Moderate (market rate) units, 39 Extremely Low Income; and 63 Low Income units. See Attachment D for the 2023 APR details.
Table 3. City Progress Towards 2023-2031 RHNA
Income Level
2023-2031
RHNA by
Income Level
Total Units
Permitted as of
December 2023
Total Remaining
RHNA by
Income Level
% of RHNA
Extremely Low
Income (0-30% AMI) 778 39 739 5.01%
Very Low Income (31-
50% AMI) 778 778 0.00%
Low Income (51-80%
AMI) 896 63 833 7.03%
Median Income (81-
100% AMI) 1,013 1,013 0.00%
Moderate Income
(101-120% AMI) 2,621 159 2462 6.07%
Total 6,086 261 5,825 4.29%
Source: City of Palo Alto, Planning and Development Services, December 2023 The 2022 Housing Element Annual Progress Report was the last reporting on the implementation of the 2015-23 Housing Element programs. A full evaluation of the 2015-2023 Housing Element programs is available in Appendix A of the Council adopted 2023-2031 Housing Element
FISCAL/RESOURCE IMPACT
There are no resource impacts. Staff time to prepare and submit reports was contemplated in the allocation of resources to the department.
STAKEHOLDER ENGAGEMENT
Members of the public had the opportunity to comment on these APR reports during the PTC hearing held on November 29, 2023; there were no public speakers for this item. Other than the required noticing for City Council and PTC meeting for public hearings in a local paper and public media, staff did not perform any specific community outreach.
ENVIRONMENTAL REVIEW
This report on the City’s progress of the existing Implementation Chapter of the Comp Plan and Housing Element is not a project requiring review under the California Environmental Quality Act (CEQA).
ATTACHMENTS
Attachment A: Comp Plan Implementation Program Status, 2023 Attachment B: Comp Plan Pending and Partially Complete Implementation Programs, 2023 Attachment C: 2023-2031 Housing Element Implementation Program, 2023 Attachment D: City’s RHNA Progress, 2023
APPROVED BY
Jonathan Lait, Planning and Development Services Director