2 objectives specified in the Draft (i.e., meet its share of the regional housing needs assessment) during the 2014-2023 planning period.
We commend the City for incorporating a number of changes that significantly improved the Draft and will make it a more meaningful planning tool. These changes will make the housing element a more effective tool to removing barriers to preserving our existing affordable housing and achieving the City’s allocation of approximately 35,000 housing units during the planning period, of which 20,850 units, or 60%, must be affordable to moderate- to very low-income wage earners.2
However, we believe that the City can and should do more to strength the Draft and public participation requirements, including:
1) Ensuring that existing, broadly-stated programs address constraints that HCD identified; 2) Updating the timeframes for two currently proposed programs to, in part, address Council’s prior directives; and
3) Ensuring that future public outreach efforts, particularly subsequent to the release of draft documents, are modified to permit community members an adequate opportunity to engage with City staff and comment.
To facilitate review, our section numbering follows that utilized by HCD in its November 27, 2014, letter.
Programs should Study and Address Constraints that HCD Identified A.1. Housing Needs, Resources and Constraints
The housing element must identify and analyze existing and projected housing needs, and it must contain a statement of goals, policies, quantified objectives, financial resources, and scheduled programs for the preservation, improvement, and development of housing.3 The housing element must also contain “an assessment of housing needs and an inventory of resources and constraints relevant to the meeting of these needs.”4It must also identify and analyze any special housing needs, including those for persons who live with developmental disabilities.5“Analysis” is defined as “description and evaluation of specific needs, characteristics and resources available to address identified needs.”
6 HCD recommended that the City amend its analysis in various ways, including that it quantify existing and projected housing needs for all income levels, including for extremely low-income (ELI) households, and analyze special housing needs, including for persons with developmental
2 Association of Bay Area Governments, Final Regional Housing Need Allocation (2014-2022), http://www.abag.ca.gov/planning/housingneeds/pdfs/Final%20RHNA%20%282014-2022%29.pdf, p. 3. 3 Gov’t Code § 65583.
4 Id. at 65583(a), emphasis added.
5 Id. at 65583(a)-(a)(7).
6 Housing Element Update Guidance, attachment 2: Completeness Checklist, http://www.hcd.ca.gov/hpd/HE%20Guidance%20Complete%20package.pdf, p. 16.
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
3 disabilities.7 It advised the City that this analysis was required to meet statutory requirements, and that this analysis was needed to allow the City to revise its policies and programs accordingly.
8 The City has increased its description and quantification of our community’s ELI housing needs considerably, and this amplified assessment has identified that San Jose’s projected need for ELI renter housing is 28,456 units.9 However, this discussion does not meet statutory requirements because it fails to discuss specific constraints that limit the promotion of ELI housing opportunities, and lacks any programs to address these constraints.10 Similarly, the City has also expanded its discussion of special housing needs, particularly regarding consumers who are developmentally disabled, and notes that San Jose is the City in our county with the highest percentage of developmentally disabled residents (about 84%, or over 7,000 individuals).
11 However, the City falls short of the SB 812 requirements because it fails to include any programs related to this need.12
A.3.1 Analysis of Actual and Potential Governmental Constraints As acknowledged by the City, its recently adopted general plan places a strong emphasis on job growth.13 HCD noted that the Draft should explain how these principles, policies, requirements are implemented, including the urban village framework, and include an analysis of potential impacts on residential development, including the City’s jobs-first and other policies that may impede the entitlement process.14 In addition to this analysis, HCD states that the City should include programs to address identified constraints.15 HCD additionally states that the Draft could include programs to further evaluate the urban village framework as part of the 2015 general plan update and modify the approach as appropriate.16
7 HCD’s November 27, 2014 letter, Appendix, § A.1, p. 1. 8 Id.
9 Draft, Chapter III-17.
10 See HCD, “Extremely Low-Income Households Housing Needs” (avail. at http://www.hcd.ca.gov/hpd/housing_element2/EHN_extremelylowincome.php). Additional programs that promote the production of ELI and special needs housing are particular important, since, during the prior planning period, San Jose substantially underperformed in facilitating the development and construction of ELI units, and, as noted in the Draft, on its own, the market will under produce a range of housing opportunities across incomes.
Draft, VIII-2. Although we commend the City for considering a variety of actions to promote ELI and special needs housing, we urge it to include additional programs to evaluate constraints that will enable it to revise its policies to meet our large, unmet need for ELI housing, especially during this period of ever-increasing housing costs.
11 Draft, Chapter III-26.
12 See letter from Glen Campora, Acting Deputy Director, Division of Housing Policy Development (June 21, 2012), re Persons with Developmental Disabilities SB 812 (Ashburn), Chapter 507, Statutes of 2010 (avail. at http://www.hcd.ca.gov/hpd/NoticeCoverLttrSB812.pdf).
13 See HCD November 27, 2014, letter, Index, p. 3.
14 Id.
15 Id.
16 Id.
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
4 Although San Jose enhanced discussion about several principles and policies in the Draft, and expanded its Work Plan program to specifically evaluate the Urban Village Strategy as part of the Four Year Major Review of the General Plan, its analysis does not fully comply with the changes HCD calls for in its review letter. The City should commit to evaluating its urban village framework and jobs-first policies as constraints and make programmatic changes, as necessary, to ameliorate them.
A.3.2 Housing for Persons with Disabilities (Reasonable Accommodation) HCD stated that, based on its review of the City’s reasonable accommodation procedure, requests for accommodations appear “subject to additional findings to allow exception to zoning and land use for housing for persons with disabilities . . . which may be a constraint and discourage access to housing.”17 HCD instructed San José to “analyze these findings as a potential constraint and include programs as appropriate.”18 One of the findings that the coalition identified as a constraint in its prior letter was the reasonable accommodation procedure’s requirement that owners of property immediately adjacent to the property requesting the accommodation (often a residential care home) be notified of the reasonable accommodation request.
The City responded to HCD’s comments by identifying the existing accommodation language in its zoning code regulations and by committing to reviewing and revising its Work Plan to include a program to “review and revise as appropriate the wording of this finding in the Zoning Code to clarify the intent of the finding.”19
We applaud the City’s inclusion of a program to review and revise the “wording” of its findings requirements. We also strongly encourage the City to expand its program to go beyond examining the “wording” of findings to eliminate unnecessary findings that are counterproductive to fair housing choice for people with disabilities and streamlining the accommodation process. We urge the City to amend its reasonable accommodation procedure to remove the adjacent property notification requirement since it encourages NIMBYism and community resistance to siting of housing facilities for people with disabilities.
B.6. Programs to Preserve Low-Income and Assisted Housing Developments HCD stated that the City’s Draft should include specific and proactive action to preserve lowincome and assisted housing developments.20 HCD provided examples, including compliance with noticing requirements, pursuing tenant education and assistance, pursuing funding within a specified timeframe, and proactively coordinating with non-profits.21
17 HCD November 27, 2014, letter, Appendix, p. 4.
18 Id.
19 Draft, Chapter IV-7 and -8.
20 HCD November 27, 2014, letter, Index, p. 6.
21 Id.
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
5 The City addressed HCD’s comment by amending program at item 8(a) of the Work Plan to state that it will develop a funding framework that allocates resources between the production of new affordable homes or the preservation of existing affordable homes. 22 We remain concerned that the City may not be striking a fair or adequate balance between committing resources to new construction and resources to preservation. Use of the word “or” suggests that the City will have to choose between new construction and preservation. And the Draft continues to state that the City plans to prioritize new construction over preservation to increase the overall supply of housing.23 Finally, the Draft continues to state that the 2,645 units at risk of conversion in the next eight years will require substantial rehabilitation and that it is only slightly less costly (or perhaps even more costly in some instances) to rehabilitate these units versus constructing new units that are higher in quality and less costly to operate.24 In fact, however, studies that analyze “lifecycle costs” show that new construction can be more costly than rehabilitating existing units.25
Further, the City’s analysis fails to consider the known benefits that preservation of affordable housing creates, such as promoting economic diversity and mixed-income neighborhoods and preventing neighborhood and family instability. Assisting residents to remain in their neighborhoods through investment helps avoid displacement and enables existing residents, including those who live with disabilities and may be dependent on existing transportation resources, to remain in their long-term and familiar neighborhoods. The City’s analysis should take these into account.
B.4. Programs to Conserve and Improve the Condition of Affordable Housing Stock HCD recommended that, given the eight-year planning period, the City expand its Work Plan programs to bolster its efforts to expand conservation opportunities for affordable housing. We commend the City for incorporating HCD’s suggestions, particularly at Work Plan items 34 and
35. However, in light of our current housing affordability crisis, we urge the City to consider starting these analyses in 2015 (instead of 2017) and explore the following policies as part of its actions/programs for item 34 (“protecting low and moderate income residents in market-rate and deed-restricted affordable housing from displacement”):
1. Monitor and prevent substantial rent increases through expanded rent stabilization measures;
2. Prevent mass residential evictions and demolitions by instituting a just cause eviction ordinance to protect tenants and promote neighborhood stability;
3. Prohibit discrimination by instituting a local source of income ordinance;
4. Fund a variety of programs that stabilize tenancies for residents at-risk of homelessness;
5. Institute strict condominium conversion policies;
6. Require a one-for-one replacement of any affordable housing removed from the supply;
22 Draft, Work Plan, Appendix D, item 8, emphasis added. 23 Draft, Chapter VI-3 and -4.
24 Id.
25 Maya Brennan, Amy Deora, Anker Heegaard, Albert Lee, Jeffrey Lubell, and Charlie Wilkins, Center for Housing Policy, 2013, “Comparing the Costs of New Construction and Acquisition-Rehab in Affordable Multifamily Rental Housing: Applying a New Methodology for Estimating Lifecycle Costs,” p. 1.
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
6 7. If existing affordable housing must be removed from the supply, require payment of adequate temporary relocation benefits and a first right of return benefit; and
8. Prevent the removal of cultural centers (including retail, entertainment and services) that lead to displacement, especially in Planned Growth Areas and Priority Development Areas.
Timeframes in the Draft’s Work Plan Should Conform to Council’s Priorities B.1. Housing Programs with Beneficial Impacts in the Planning Period HCD urged the City to revise Work Plan programs that contained an “on-going” timeframe to a timeframe that would, among other things, have a beneficial impact in the planning period.26 HCD recommended that programs 1, 5, 15, 16, 17, 18, 19, 22, 25, 26, 30, 34, 35, 36 and 45 be amended to include “discrete timelines for implementation, such as by year, quarter, date, within two years, etc.”27
We commend the City for amending the aforementioned programs to include a discrete timeline.
Additionally, we urge the City to amend these timelines as follows:
1. Amend Work Plan 18’s program (mobile home conversion requirements) timeframe to 2015 to align with Council’s September 9, 2014, prioritization of this matter for the 2014- 2015 period.28
2. Amend Work Plan 34’s programs (relocation benefits, anti-displacement policies) from 2017-2018 or “ongoing” to 2015. The Urban Village planning process is actively underway, and the Work Plan programs at item 15, which seek to implement the urban village plans, do not include any programs that protect low- and moderate-income residents in market-rate and deed-restricted affordable housing from displacement. Given the threat that the Urban Village plans pose to this housing, programs to protect it and the people who live there from displacement must run concurrently with the Urban Village planning process and occur in 2015.
Public Outreach Efforts Should be Improved, Particularly After the Release of Reports D. Public Participation
HCD states that, as required by law, public participation in the development, adoption and implementation of the housing element is essential to effective housing planning.29 HCD urged
26 HCD November 27, 2014, letter, Appendix, p. 5.
27 Id.
28 During Council’s September 9, 2014, Priority Setting Session, members voted 8-3 to direct staff to “review and potentially amend the Mobile Home Conversion Ordinance to address the protection of health, safety and welfare of mobilehome park residents, including any needed General Plan amendments.” Minutes of the City Council, http://www.sanjoseca.gov/DocumentCenter/View/38671, p. 29. This was the only item to receive even the needed 6, still less 8, votes to gain a position on the priority list, which demonstrates Council’s direction that this issue be prioritized for 2015.
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
7 the City to “continue to engage the community, including organizations that represent lowerincome and special needs households, by making information regularly available and considering and incorporating comments where appropriate.”30
We appreciate staff’s hard work on the Draft to date but have encountered difficulties in providing adequate and constructive feedback given the untenably short public input deadlines established by the City. As we identified in our comprehensive comment letter to Council on September 22, 2014, the timing of the release of drafts of the housing element and the various public meetings have severely impeded the public’s ability to conduct a comprehensive review weigh in meaningfully on this 220-plus-page highly technical—and critically important— document.31
In the most recent iteration of the housing element, the City released its voluminous document on January 7, 2015, and presented it to two City Commissions, and will request that the Council adopt the Draft on January 27, 2015. Subsequent to the release of the Draft, no community meetings (to review the changes to the Draft with any specificity) were held, leaving staff with no room to consider or incorporate comments from the public or for the public to absorb and comprehend in such a short period of time.
The City is not required to adopt the Draft by January 27, 2015; instead, as noted in HCD’s comment letter, the City “must adopt its housing element within 120 calendar days from the statutory due date of January 31, 2015.”32
Further, if application to the OneBayArea Grant (OBAG) Program was originally the basis for seeking to adopt the Draft in January, in December 2014, the Association of Bay Area Governments announced that it had extended the deadline for housing element certification by 120 days from January 31, 2015, to May 31, 2015.33 The haste with which the Housing Element is being pushed through the public process is unwarranted.
The City still has several months to consider public comment, review the Draft, adopt a more thoroughly-considered housing element and submit it to HCD for consideration. Therefore, we ask the City to continue its vote on whether to adopt the Draft to a later date to afford community members adequate time to comment and for the City to consider and possibly incorporate these comments. Absent this, we urge the City to direct staff to revise its public comment process, especially when voluminous documents that impact significant planning policies and programs are involved, that future outreach processes and procedures be modified to permit community members an adequate opportunity to engage with City staff and comment.
29 HCD November 27, 2014, letter, Appendix, p. 7, citing Government Code § 65583(c)(7). 30 Id.
31 Coalition letter to San Jose City Council, September 22, 2014, http://www.sanjoseca.gov/DocumentCenter/View/35982, p. 369. 32 HCD November 27, 2014, letter, p. 1, emphasis added. 33 Contra Costa Transportation Agency, Technical Coordinating Committee Staff Report, January 15, 2015, http://ccta.granicus.com/MetaViewer.php?view_id=1&event_id=58&meta_id=8264, Attachment “A,” (email from Craig Goldblatt, STP/CMAQ Regional Program Manager, Metropolitan Transportation Commission).
Letter to Mayor, Vice Mayor, and City Council Regarding Housing Element January 26, 2015
8 Thank you for the opportunity to provide feedback on the Draft. We look forward to the City’s response to our suggested revisions. For any questions, please contact Diana Castillo at 408- 280-2448 or via email at [email protected].
Sincerely,
/s/
Diana Castillo
Senior Attorney
Law Foundation of Silicon Valley
/s/
Richard Konda
Executive Director
Asian Law Alliance
/s/
Poncho Guevara
Executive Director
Sacred Heart Community Service
Derecka Mehrens
Executive Director
Working Partnerships USA
/s/
Marie Bernard
Executive Director
Sunnyvale Community Services
/s/
Sandy Perry
Affordable Housing Network of Santa Clara County
cc: Housing Department, Planning Department, and the California Housing and Community Development Department
HONORABLE MAYOR AND CITY COUNCIL
January 16, 2015
Subject: GPT14-001 Housing Element Update
Work Plan to address comments by HCD (see attached PowerPoint presentation and Index of Revisions that were distributed to the Planning Commission at the public hearing on January 14, 2015).
The presentation was followed by Planning Commission discussion and public comment on the State requirements for the City’s Housing Element. One speaker mentioned that many people, and in particular at-risk youth, are experiencing homelessness. She thanked the City for including policies and activities to address homelessness and encouraged the City to do more to find permanent housing solutions for the homeless. Another public speaker, representing the Building Industry Association (BIA), stated that BIA had previously submitted a comment letter to the City, and that there should be more expediency by the City to update the General Plan to provide a clear and consistent path for development of the housing capacity in the Urban Villages so that the City’s portion of the Regional Housing Needs Allocation (RHNA) is adequately provided for in the Housing Element. Planning Commissioners asked clarifying questions on the costs of residential development, including the City’s newly adopted Affordable Housing Impact Fee (AHIF), and availability of capacity for residential development in the Urban Villages. The Planning Commission then voted to approve staff’s recommendations.
During the Planning Commission meeting on January 14, 2015, two questions were raised about the implementation of the Affordable Housing Impact Fee (AHIF). Which projects will be subject to the fee; and
Is there a sunset provision to the 2.4% annual increase to the AHIF? Which projects will be subject to the fee? The AHIF will apply to all market-rate multifamily developments of three or more units that have not pulled all Building Permits by June 30, 2016.
To minimize negative financial impacts on development projects “in the pipeline,” the AHIF does include exemptions for developments if certain conditions are met. A development project may be exempted from the AHIF if it meets the following conditions:
1. Prior to July 1, 2016, the development has received approval for one of the following entitlements and that approval is current and unexpired as of June 30, 2016:
a. Planned Development Permit
b. Site Development Permit
c. Conditional Use Permit
d. Special Use Permit
2. The Developer will need to submit, and have approved by the Housing Department, a complete Pipeline Application with evidence of the required permit and associated fee by June 30, 2016, and
3. Prior to January 31, 2020, the development has received a Certificate of Occupancy for at least 50% of the units in the building.
HONORABLE MAYOR AND CITY COUNCIL
January 16, 2015
Subject: GPT14-001 Housing Element Update
The Housing Department is in the process of developing materials (including the Program Regulations) to assist developers in better understanding the City’s AHIF Program. Additional information will be posted to the Housing Department’s website periodically.
Is there a sunset provision to the 2.4% annual increase to the AHIF? Beginning July 1, 2017, the AHIF will increase by 2.4% annually. The increase is intended to account for anticipated increases in development costs. The escalator provision will not sunset. However, the rate of the AHIF annual increase will be reevaluated in five years, at which time the rate of the escalator provision will also be reassessed.
The AHIF program will begin on January 18, 2015, as the effective date; however, the operative date of the program is July 1, 2016.
Housing and Community Development Commission
On January 15, 2015 City staff presented the update of the Housing Element process to date to the Housing and Community Development Commission. Members of the public asked if there was a Housing Element work-plan item to protect mobile home parks, asked the Commission to further debate the Draft Housing Element, raised concerns about the ability to meet the RHNA goals under the jobs-focused General Plan and noted that parks fees in the table on pages 23-25 of Chapter IV should be updated because fees changed December 1, 2014. One speaker asked to have the AHIF included in the fees analysis tables in the Housing Element and to clarify on public record when the fee will take effect. Another member of the public asked which funding sources the City would be eligible for if the Housing Element was submitted on time and certified by HCD. A commissioner stated she was pleased with revisions that more strongly represented the needs of vulnerable communities. Another commissioner asked why there was no specific program to prevent discrimination against elderly lesbian, gay, bisexual, and transgender community members. The Housing and Community Development Commission then voted (7-1-1) to approve staff’s recommendations.
EVALUATION AND FOLLOW-UP
If Council adopts the Housing Element, staff will then submit the adopted Housing Element to HCD for certification. Certification by HCD maintains the City’s eligibility for State funds that support existing housing programs and infrastructure projects. HCD certification also creates a rebuttable presumption of validity of the Housing Element in any action to challenge the validity of the Housing Element (Government Code section 65589.3).
POLICY ALTERNATIVES
Alternative #1: Do not adopt the Housing Element or approve submittal of the Housing Element to State HCD.
Pros: None.
HONORABLE MAYOR AND CITY COUNCIL
January 16, 2015
Subject: GPT14-001 Housing Element Update
Cons: Not approving submittal of the Housing Element to State HCD jeopardizes certification of the Housing Element by the State on time.
Reason for not recommending: State certification is required for the reasons stated above. A number of cities and counties have lost lawsuits because of the inadequacy of their Housing Elements. One of the types of actions that the courts have taken in these cases is to impose a moratorium on the issuance of building permits for all development (not just residential) until the jurisdiction complies with the requirements of the court’s decision, such as designating specific minimum quantities of land for affordable housing, producing a specific minimum amount of affordable housing units, and obtaining certification of a Housing Element. Land use decisions based upon an inadequate General Plan or Housing Element have also resulted in invalidation of the approval of specific projects. As mentioned above, certification by HCD maintains the City’s eligibility for State funds that support existing housing programs, transportation and other infrastructure projects.
PUBLIC OUTREACH
The City created a website URL (www.sanjoseca.gov/housingelementupdate) and customized project e-mail address ([email protected]) to share information and invite public feedback about the process. On January 15, 2014 an introductory “e-blast” was sent to a list of more than 3,000 persons and organizations with a demonstrated interest in the topic. The wide distribution of this e-blast was then further extended by subsequent communication from individual City Council District offices to their respective constituents and forwarding by the City Manager’s Office to a list of more than 200 community groups.
Revised drafts of the Housing Element with agency and public correspondence are posted on the website, and staff sent e-mail blasts to subscribers, including the general public, Council District offices, and other interested parties, to provide the public an opportunity to submit comments on the drafts.
Staff received written correspondence during preparation of the Draft Housing Element. This correspondence received as of the writing of this memorandum is attached. To the extent feasible, the comments have been addressed in the Draft Housing Element.
COORDINATION
This report and the proposed Housing Element were coordinated with the City Attorney’s Office, the Housing Department, the Housing and Community Development Commission, and the Santa Clara County Airport Land Use Commission, which considered the item at its public meeting on September 24, 2014, and found it in conformance with applicable land use policies and plans.
HONORABLE MAYOR AND CITY COUNCIL
January 16, 2015
Subject: GPT14-001 Housing Element Update
CEQA
Envision San José 2040 General Plan Environmental Impact Report (EIR), Resolution No. 76041, and Addenda thereto; Downtown Strategy 2000 EIR, Resolution No. 72767, and Addenda thereto; North San José Development Policies EIR, Resolution No. 72768, and Addenda thereto; and Diridon Station Area Plan EIR, Resolution No. 77096 and Addenda thereto (collectively, the “Final Program EIRs”). Pursuant to Section 15168 of the CEQA Guidelines, the City of San José has determined that this activity is within the scope of the earlier approved programs and the Final Program EIRs adequately describe the activity for purposes of CEQA. The project does not involve new significant effects beyond those analyzed in the Final Program EIRs.
/s/
HARRY FREITAS, SECRETARY
Planning Commission
For questions please contact Interim Planning Official, Steve Piasecki, at 408-535-7893.
Attachments: Staff Report
PowerPoint Slides Presented at Planning Commission