September 11, 2023
Honorable Jill C. Fannin, Judge of the Superior Court
Cynthia Roberts, Foreperson, 2022-2023 Contra Costa County Civil Grand Jury Contra Costa County Civil Grand Jury
P.O. Box 431
Martinez, CA 94553
Also via email to [email protected]
RE: City of Pleasant Hill’s Response to Report No. 2306, Affordable Housing “A Plan Without a Home”
Dear Judge Fannin and Foreperson Roberts:
In June 2023, the Contra Costa County Civil Grand Jury issued Report No. 2306 entitled “A Plan Without a Home.” Below find the City of Pleasant Hill’s responses to the report’s findings and recommendations.
Findings:
Fl. Within existing city or County infrastructure there is no clear owner who is responsible for achieving RHNA permitting targets.
City Response:
Partially Disagree. We partially disagree with Finding 1 because, while the City is responsible for reporting on RHNA permitting targets, the City does not develop housing projects. State Housing Law only requires that jurisdictions plan to address barriers to development, accommodate various types of housing based on the RHNA allocations, and report their progress towards RHNA. The City of Pleasant Hill Planning Division is responsible for preparing the Annual Progress Report (APR) as required by State Housing Law, which City staff presents to City Council early in the calendar year and prior to submission to HCD. Furthermore, each jurisdiction’s Housing Element identifies the City department or division responsible for implementing the Housing Element’s Plans and Programs.
F2. City and County officials see no direct path to meet state-mandated regional housing (RHNA) targets.
City Response:
Partially Disagree. We partially disagree with Finding 2 because, while the City recognizes the challenges ahead, the City of Pleasant Hill Housing Element identifies a clear path to accommodate the RHNA targets. The City actively and continuously explores and implements policies, programs, and strategies to satisfy state-mandated RHNA targets. Despite the complexity of the task, the City is committed to finding viable solutions and collaborating with stakeholders to address the housing needs of the region. While it may be a challenging endeavor, the dedication and proactive approach of the City demonstrates a commitment to addressing the housing crisis and fulfilling obligations in accordance with state mandates. Although the City is not a housing developer and therefore does not physically construct any units, the City is currently streamlining and accommodating housing projects by revising applicable sections of the zoning ordinance and providing information to community members and the development community in order to facilitate the construction of affordable housing units.
F3. There are currently no measurable penalties if a city or a County does not achieve RHNA targets in an approved housing element plan.
City Response:
Partially Disagree. We partially disagree with Finding 3, as a noncompliant Housing Element does disqualify the City from receiving various State originated grant funding for various City purposes, which is a measureable financial penalty. In addition, there are currently no legal or financial penalties if the City of Pleasant Hill does not achieve its RHNA targets, though there are penalties for not accommodating RHNA in a Housing Element and the consequences for not issuing adequate permits can be considered punitive.
In addition, jurisdictions are subject to penalties if they do not adopt a Housing Element that is certified by the State, including designating adequate sites to accommodate the RHNA targets.
For example, cities and the County may be subject to litigation from individuals, housing rights’ organizations, developers, and/or HCD. Depending on court decisions, local control may be further diminished, beyond that prescribed in State law, including, for example, the suspension of a city’s authority to issue building permits or approve certain land use permits. A city may also be subject to court-issued fines, court receivership, and streamlined approval processes that remove local discretion.
F4. Data published by ABAG shows that Contra Costa County and most of its cities have missed their current RHNA targets for very low- and low-income housing allocations.
The allocation requirements continue to increase (l6x for very low-income and 4x for low- income residents).
City Response:
Partially Disagree. It is true that many cities and the County as a whole missed their RHNA targets for very low and low-income housing, and that the RHNA for very low- and low-income housing has continued to increase. However, the increase in RHNA is not to the extent mentioned in this report. RHNA numbers from the past three cycles demonstrate that the current cycle (the 6 th cycle) has had the largest increase - 2.5 times greater than that of the 5th cycle for very lowand low-income housing requirements.
Cycle Very Low % permitted Low % permitted Source
1999 - 2006 6,481 44% 3,741 48% link
2007 - 2014 6,512 21% 4,325 24% link
2015 - 2020 5,264 16% 3,086 55% link
2023 - 2031 13,346 n/a 7,685 n/a link
F5. Many obstacles hinder the development of AH at the local level, specifically for very low- and low-income housing, including:
a. Limited availability of land;
b. Restrictive zoning policies specific to AH development; c. Limited developer interest to bring projects forward; d. Limited available funding;
e. Lack of community support;
f. NIMBY opposition & city council response to NIMBY opposition.
City Response:
Partially Disagree, as noted below:
a. The City of Pleasant Hill is mostly built-out, with small pockets of vacant land available throughout the City. This results in the majority of development projects to be infill in nature. Despite this, the City has identified housing sites in our approved-but-not-yetcertified Housing Element that have been considered acceptable to HCD. b. Zoning policies apply to all residential development; affordable housing does not have a more restrictive provisions. In addition, existing State law and more recent legislation streamline the process and grant affordable housing projects advantages that are not applicable to market rate housing projects, including concessions and waivers from local zoning regulations.
c. The City has approved multiple affordable housing projects (SAHA Senior Affordable Housing, Hookston Senior Apartments, Grayson Creek Apartments) within the City. d. Though available funding can hinder the development of affordable housing, the City has addressed this in the Housing Element programs, policies, and actions to the extent feasible and considered acceptable to HCD.
e. When sited and designed consistent with surrounding development, affordable housing does not enjoy any less community support in the City of Pleasant Hill. f. The Pleasant Hill City Council has approved affordable housing projects throughout the City despite NIMBY resistance, including 401 Taylor Boulevard (small lot residential), 85 Cleaveland Road (five story apartment complex), and 490 Golf Club Road (affordable senior housing) .
F6. Zoning changes are generally addressed only when a project is presented for development. Zoning obstacles include:
a. Housing element plans that offer poor land choices for AH development; b. Restrictive height and high-density zoning policies; c. Lack of inclusionary housing ordinance(s) in many cities.
City Response:
Partially Disagree, as noted below:
a. The recent City Housing Element identifies affordable housing sites within close proximity to alternative modes of transportation and necessary services. However, comments from the State HCD have required revisions to the City’s inventory of opportunity sites that have reduced access to alternative modes of transit and necessary services. b. The City is in the process of a comprehensive rezoning effort that will provide more flexible height and density in Pleasant Hill to allow for higher density development. c. The City of Pleasant Hill has had an inclusionary housing ordinance since 1996.
F7. Penalties directed at cities and the County (financial, loss of control over local planning) are tied to not meeting state deadlines for Housing Element plan approval City Response:
Agree
F8. Builder's Remedy and S835 projects do not address ingrained local obstacles identified in this report that prevent the completion of approved AH projects.
City Response:
Partially Disagree. While Builder's Remedy and SB35 are tools available to developers to expedite review of affordable housing development proposals, they may not comprehensively address all the ingrained local obstacles identified in this report that hinder the completion of approved AH projects. The effectiveness of these streamlined processes can vary from jurisdiction to jurisdiction, and while they can help overcome certain barriers like restrictive zoning policies and prolonged approval timelines, other challenges mentioned in the report, such as limited available funding, community support, and NIMBY opposition may continue to persist in diverse degrees in different locations. To achieve the successful completion of approved AH projects and effectively address these obstacles, a multifaceted and jurisdiction-specific approach is required, taking into account the unique circumstances and complexities faced by each locality.
F9. When local Redevelopment Agencies (RDA's) were discontinued by the state in 2012, the County and cities did not address the loss of funding for affordable housing or find alternative funding to support affordable housing projects until voters passed Measure X in November 2020. Projects that target very low- and low-income residents were particularly impacted.
City Response:
Partially Disagree. While the County and cities did not create or find new sources to fund affordable housing development after the State discontinued 452 RDAs, State law limits local jurisdictions’ ability to create new funding sources. Voters need to approve virtually all new funding or financing mechanisms to generate the revenues or funds needed to preserve existing affordable housing and construct or finance new affordable housing. The Board of Supervisors and Town/City Councils cannot, for example, float bonds any longer without voter approval.
While voters approved Measure X, the countywide, 20-year, half-cent sales tax, in November 2020, Measure X is projected to provide up to $12 million annually for “housing and related services” for the entire County (emphasis added). Measure X Affordable Housing funds will be distributed through a Notice of Funding Availability (NOFA) process, a competitive process.
Fl0. Measure X housing funds are not fully dedicated to building AH for very low- and low- income residents.
City Response:
Agree
Fl1. Local funding provided by bonds like Measure X Housing Fund is a critical component of a developer's overall ability to raise funds for an AH development.
City Response:
Partially Disagree. Bond funding requires voters’ approval. Given timing considerations (economic conditions and bond measures for other competing interests), bond financing has not been the most significant source of affordable housing financing. While local funding provided by bonds like Measure X Housing Fund in Contra Costa County are a beneficial component to help fund affordable housing construction, the amount of funding available from Measure X is not high enough to bolster a developer's overall ability to raise funds for an affordable housing (AH) development. Under the Measure X Program Allocation Summary, only $10 million dollars (about 13% of FY 2022-23 funding and about 4.5% of total funding) were allocated to a Local Housing Trust Fund; for FY 2023-24, $12 million dollars were allocated. The Measure X Housing Funds are to be dispersed by the Department of Conservation and Development (DCD) and the Health Services’ Health, Housing and Homeless (HSD-H3) Services, and the Housing Authority of the County of Contra Costa. While a contributing factor and certainly welcome, Measure X dollars are too small to be considered “critical” to the overall ability of the jurisdictions to meet their RHNA requirements for affordable housing.
F12. Cities that proactively engage citizens, address zoning obstacles, make reasonable zoning concessions, work collaboratively with developers, provide local funding support, and are united in addressing NIMBY opposition, have been successful in attracting AH projects.
City Response:
Partially Disagree. The City agrees that proactive strategies can help attract affordable housing developers and mitigate the barriers to housing production; however, proactive strategies alone do not yield affordable housing projects. For example, while the City of Pleasant Hill engages in many of the above strategies, a variety of other obstacles to affordable housing development exist beyond a local jurisdiction’s control. This includes the gap in financing between constructing market-rate versus affordable housing; high land costs, especially for Central County jurisdictions like Pleasant Hill; land-to-building ratios for properties with underutilized structures; the cost to upgrade or renovate an existing nonresidential building to accommodate housing; infrastructure costs (on- and off-site); fees for public utilities and special districts (particularly for non-municipal utilities), etc.
Fl3. The latest RHNA targets for cities and unincorporated Contra Costa County show a significant increase in the number of units that are expected to be permitted for very low- and low-income housing.
City Response:
Agree
Recommendations:
RI. Each city and the County should consider assigning a staff position with clear leadership, ownership and accountability to achieve allocated RHNA targets. The individual in this position would be responsible for establishing and promoting an operational plan to achieve the RHNA goals set forth in the housing element plan.
City Response:
The recommendation has been implemented. California’s Housing Element Law acknowledges that, in order for the private market to adequately address the housing needs and demands of Californians, local governments must adopt plans and regulatory systems that provide opportunities for (and do not unduly constrain) housing development. The City is not responsible for the development and construction of housing to achieve the allocated RHNA targets. Instead, the City is responsible for effectively implementing its housing element and associated programs to address any existing constraints to housing and for tracking and reporting the jurisdiction’s progress toward achieving their RHNA. The City of Pleasant Hill Planning Division is assigned the responsibility for these tasks.
R2. Each city and the County should report AH progress and lack of progress using data across all four measured income groups. Special attention should be paid to tracking the housing needs of residents categorized as very low- and low-income.
Cities and the County should communicate their progress, biannually, against RHNA targets at council and supervisor meetings.
City Response
The recommendation has been implemented, as the City of Pleasant Hill completes State of California Annual Housing Reports that provide this information on an annual basis. Before the report is sent to the State, it is reviewed and accepted by the City Council.
R3. Each City and the County should consider creating a dedicated AH commission comprised of a multi-disciplinary team of diverse citizens and led by a current, nonelected, city expert in planning. Each commission would be charged with providing a community voice in the process and helping to identify and address obstacles that hinder the development of affordable housing projects in their community.
City Response:
The recommendation will not be implemented. We appreciate the thoughtful recommendation to create a dedicated Affordable Housing (AH) commission comprising a multi-disciplinary team of diverse citizens, led by a current, non-elected, city expert in planning. While we acknowledge the potential benefits of such a commission, after careful consideration, we have decided not to pursue its implementation for the following reasons:
Resource Constraints: Establishing and maintaining a dedicated AH commission would require additional financial and administrative resources. At present, our city is already allocating resources to multiple initiatives aimed at addressing affordable housing needs. Adding another commission might spread resources too thin and hinder the efficiency of current efforts.
Efficient Decision-Making: By involving a diverse range of citizens and experts in existing planning and housing committees, we maintain a balanced and inclusive approach. This integration ensures streamlined decision-making processes and comprehensive representation of community interests without creating an additional layer of bureaucracy.
Alternative Approaches: Instead of forming a separate AH commission, we are committed to strengthening the involvement of community members and experts in our existing planning and housing committees. Enhancing public outreach and encouraging community feedback will remain focal points in our efforts to address obstacles hindering affordable housing development.
R4. Each City and the County should consider reviewing existing processes and identifying changes that would address or resolve the specific obstacles identified in this report that hinder achieving RHNA allocation targets for very low- and lowincome housing in their community.
City Response:
The recommendation has not been fully implemented, but will be implemented in the future, as the City is starting a comprehensive zoning ordinance update that will consider provisions of the recently adopted Housing Element, and will better address development for affordable housing projects. In addition, the adopted Housing Element contains various programs that will better address the creation of affordable housing in the City.
R5. Each City and the County should consider developing a public dashboard to report progress against RHNA targets.
City Response:
The recommendation has been implemented, as the City prepares annual reports, submits it to the State that notes progress against RHNA targets, and is available for public viewing. In addition, the City does maintain a project list for all active projects in the city, including residential projects. The City will consider creating and maintaining a dashboard of residential housing projects on the City website that can be reviewed by the public, as suggested.
R6. Each City and the County should consider, in their individual Housing Element plans, putting forth land zoned "suitable for residential use," without development obstacles, and located strategically close to existing services, for AH purposes.
City Response:
The recommendation has been implemented, as the City of Pleasant Hill recently adopted its Housing Element that addresses the recommendation noted above. Many housing opportunity sites identified in the approved element are located in areas that have access to existing services, and the zoning ordinance is being updated to better address development patterns to accommodate affordable housing projects.
R7. Each city and the County should consider reviewing their zoning policies to identify restrictive zoning policies unique to their jurisdiction that impede AH projects and consider making zoning changes in light of that review that will support AH in their community.
City Response:
The recommendation has been implemented. Through the Housing Element process, the City has reviewed its existing zoning policies and identified potential affordable housing development constraints. The City included Housing Element Programs that outline forthcoming changes to zoning policies with specified timeframes to address the identified constraints.
R8. Cities should consider adopting an inclusionary housing ordinance as part of their standard development policy by the end of2023 (if not already in place).
City Response:
The recommendation has been implemented, as the City adopted its inclusionary housing ordinance in 1996.
R9. Each city and the County should consider how to prioritize the implementation of housing projects that promote development of very low- and low-income housing.
City Response:
The recommendation has been implemented, as the adopted Housing Element includes a policy/program that provides prioritization of AH projects. In addition, the adopted Housing Element includes policies and programs that promote AH development including Policies H2.2, H-2.3, H-3.1, H-3.3 and Programs V, X, Z, CC, JJ.
RI0. Each city and the County should consider prioritizing Measure X funding requests that support projects that address RHNA targets for very low- and low-income residents.
Each city and County should consider reporting regularly to their residents on the use of Measure X funds for such purposes.
City Response:
The recommendation has been implemented, as the City in the process of following the wishes of the voters, applying any Measure X funding received, and allocating to affordable housing, specifically to projects that accommodate very-low and low-income residents. When these project are approved, the City will include this information in the publicly available annual report. In addition, the use of Measure X funds for housing are reported by the County here:
https://www.contracosta.ca.gov/8530/Measure-X.
Please feel free to contact me for additional information regarding the City’s response at 925-671-5224.
Sincerely,
Troy Fujimoto
City Planner
Cc:
Timothy M. Flaherty, Mayor
Matthew Rinn, Vice Mayor
Sue Noack, Vice-Mayor
Zac Shess, Councilmember
Allen Vinson, Councilmember
Ethan Bindernagel, City Manager
Janet Coleson, City Attorney
Attachments: Letter from Contra Costa County Civil Grand Jury Regarding Report Contra Costa County Civil Grand Jury Report