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PUBLIC HEARING
City of San Bernardino
Request for Council Action
Date: February 21, 2024
To: Honorable Mayor and City Council Members
From: Charles A. Montoya, City Manager
Mary E. Lanier, Interim Community Development and Housing Director
Department: Community Development and Housing
Subject: Development Code Amendment 23-03 (Density
Bonus)
Recommendation:
It is recommended that the Mayor and City Council of the City of San Bernardino:
1. Introduce for first reading, read by title only, and waive further reading of Ordinance No. MC-1629 of the Mayor and City Council of the City of San Bernardino, California, approving Development Code Amendment 23-03 amending Chapter 19.04 (Residential Zones) Section 19.04.030 (Density Bonus) of the City of San Bernardino Development Code (SBMC Title 19) in order to update the Density Bonus section in compliance with State law; and finding that Development Code Amendment 23-03 is exempt from review under the California Environmental Quality Act;
2. Conduct the Public Hearing; and
3. Schedule the adoption of the above Ordinance to the regularly scheduled meeting of the Mayor and City Council on March 6, 2024.
Executive Summary
Approval of Development Code Amendment 23-03 will amend the City’s Density Bonus Ordinance to comply with the current provision of the State Density Bonus Law. Density Bonus Law allows increased residential density and concessions and waivers of zoning and development standards in exchange for an affordable housing covenant to be placed on a property. These provisions help encourage the development of affordable housing in the City.
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Background
The State and its cities have a housing shortage, especially affordable housing, which can be described as the “housing crisis.”
The State adopted the Density Bonus Law (Gov. Code §§65915 - 65918) in 1979. The law permits a developer to increase density on a property above the maximum set under the City’s General Plan. In exchange for the increased density, a certain number of the new affordable dwelling units must be reserved at rents below market rate.
Qualifying applicants can also receive reductions in required development standards.
More significant benefits are available for projects with higher affordability percentages (with unlimited density available for certain transit-adjacent, 100-percent below-market rent projects).
Besides granting rights to housing and mixed-used developments to increase density, the law provides three provisions that require the City to grant qualifying projects: 1) incentives (or concessions) that provide cost reductions; 2) waivers of development standards that would physically preclude the development of a project at the density permitted and with the incentives granted; and 3) reductions in parking requirements.1 Section 19.04.030(2)(D) of Chapter 19.04 – Residential Zones was enacted to comply with the State Density Bonus Law (DBL).
Since the City’s Density Bonus section was adopted many years ago, the State has changed DBL numerous times. The pace of changes at the State level has increased in recent years. For example, in September 2020, the Governor signed a package of fifteen bills to increase affordable housing production and reduce housing costs.
Several of these bills were aimed at increasing the incentives to build more affordable housing and more housing near public transit. Each year, bills amending the DBL have been passed. This year, on October 11, 2023, Governor Newsom signed 56 bills that incentivize and reduce barriers to housing and support the development of more affordable homes. Three of these bills amended the DBL. The Density Bonus section was planned to be revised to be in compliance with the updated Development Code (underway).
As part of Housing and Community Development’s (HCD’s) October 2, 2023, letter regarding the City’s draft Housing Element, HCD requested a discussion of provisions of the City’s density bonus ordinance that constitute a constraint. This is included in the updated Housing Element.
Pursuant to the Stipulated Final Judgement and Order submitted in Gracia et al. v. City of San Bernardino states, it states that the City will update the density bonus ordinance as required by statute and stipulation agreement. In the meantime, the City has issued an interdepartmental memo directing staff to process and approve any application for 1 Density Bonus Law, What are Incentives/Concessions and Waivers, SCAG Development Streamlining Tools 1 8
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a density bonus consistent with Government Code 65915-65918. This Development Code Amendment 23-03 meets the requirements of State law.
Discussion
The Density Bonus Law (found in California Government Code Sections 65915 – 65918) provides developers with powerful tools to encourage the development of affordable and senior housing, including up to a 50% increase in project densities for most projects, depending on the amount of affordable housing provided, and an 80% increase in density for projects which are completely affordable. The Density Bonus Law is about more than the density bonus itself, however. It is a larger package of incentives intended to help make the development of affordable and senior housing economically feasible. Other tools include reduced parking requirements, and incentives and concessions such as reduced setback and minimum square footage requirements. Often, these other tools are even more helpful to project economics than the density bonus itself, particularly the special parking benefits. Sometimes these incentives are sufficient to make the project pencil out, but for other projects, financial assistance is necessary to make the project feasible.”2 At a minimum, the City must comply with State law regarding the DBL. Therefore, it is recommended that the City adopt the Government Code Section 65915 -65918 in its entirety. The City may amend the Section to allow for more significant incentives/concessions, parking reductions, and density, but the City cannot recommend anything less than State law.
Proposed Amendment
In order to ensure that the City’s Density Bonus section complies with State law, this amendment will update 19.04.030 to match State law completely. Attachment A; Exhibit A reflects the redline/strikeout of 19.040.030, showing the needed changes to comply with State law. Within the redline/strikeout, the blue/strikeout reflects the three bills recently signed by Governor Newsom on October 11, 2023 (AB 323, AB 1287, & SB 713), which go into effect on January 1, 2024. Rather than create another amendment in January, it is suggested that the City consider adopting these changes now so the Density Bonus section will be entirely current.
Implementation
The amendment to the Density Bonus section will take effect 30 days following the approval of Development Code Amendment 23-03 by the Mayor and City Council. 2 Guide to the California Density Bonus Law, Jon Goetz and Tom Sakai, Revised January 2023. 1 8
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General Plan Goals and Policies
The City of San Bernardino General Plan includes goals and policies to guide future housing development within the City, including the following:
Land Use Policy Goal 2.1.4: Provide assistance in the form of grants, loans, home-improvement efforts, coordinated code and law enforcement, public right-of-way maintenance and enhancement, and trash collection to help improve San Bernardino’s residential neighborhoods. (LU-1 and LU-3) Land Use Policy 2.4.1: Quality infill development shall be accorded a high priority in the commitment of City resources and available funding.
Land Use Policy 2.4.2: Continue to provide special incentives and improvement programs to revitalize deteriorated housing stock, residential neighborhoods, major business corridors, and employment centers. (LU-3 and LU-4)
Housing Goal 3.3: Affordable Housing Assistance. Assist in the provision of affordable housing to lower-income and moderate-income households.
Housing Goal 3.4: Fair Housing Opportunity. Promote fair and equal housing opportunities for all persons in San Bernardino.
Housing Goal 3.5: Governmental Constraints. Reduce adverse effects of governmental actions on the production, preservation, and conservation of housing, particularly for lower-moderate-income households.
The adoption and implementation of Development Code Amendment 23-03 is consistent with the City’s General Plan by allowing for the development of affordable housing in a manner consistent with State law.
2021-2025 Strategic Targets and Goals
Development Code Amendment 23-03 aligns with Key Target Goal No. 3: Improved Quality of Life and 4(b): Economic Growth and Development – Update the General Plan and Development Code. Specifically, the amendment will update the Development Code for compliance with State law. The amendment to the Development Code will ensure consistency with State law.
Fiscal Impact
There will be no fiscal impact on the City’s General Fund as a result of this action.
Conclusion
It is recommended that the Mayor and City Council of the City of San Bernardino:
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1. Introduce for first reading, read by title only, and waive further reading of Ordinance No. MC-1629 of the Mayor and City Council of the City of San Bernardino, California, approving Development Code Amendment 23-03 amending Chapter 19.04 (Residential Zones) Section 19.04.030 (Density Bonus) of the City of San Bernardino Development Code (SBMC Title 19) in order to update the Density Bonus section in compliance with State law; and finding that Development Code Amendment 23-03 is exempt from review under the California Environmental Quality Act;
2. Conduct the Public Hearing; and
3. Schedule the adoption of the above Ordinance to the regularly scheduled meeting of the Mayor and City Council on March 6, 2024.
Attachments
Attachment 1 Ordinance No. MC-1629 (Approving Development Code Amendment 23-03)
Attachment 2 Ordinance No. MC-1629 (Approving Development Code Amendment 23-03) – Exhibit A
Attachment 3 Resolution No. 2023-049 - PC
Attachment 4 Newspaper Display Ad
Ward:
All Wards
Synopsis of Previous Council Actions:
N/A