From:Hilary Hobbs
To:Truckee
Cc:Truckee Town Council; town-dept-heads
Subject:Council questions- continued discussion items
Date:Tuesday, November 28, 2023 9:55:13 AM
Attachments:Outlook-xrtl1rqq.png
Good morning-
Below we are re-sharing the questions and answers that were published November 14th regarding the two discussion items that were continued from November 14th to thisevening's Council Meeting.
7.1: Weatherization
1. Image 1 shows energy burden by census tract. Can the energy burden be shown for census blocks or some other area that is smaller than a census tract?
Staff Response: Census tracts are the smallest geographic area for which this data is available in the LEAD tool.
2. Is the energy burden directly derived from data for those specific census tracts or is it an average taken from a larger area?
Staff Response: The average energy burden shown is derived from the Census Bureau data for those specific census tracts.
3. A cost-effectiveness energy study for Truckee generated on December 16, 2022, shows there were 1544 single-family units built before 1978, 2378 units built from 1978 to 1991, and 6356 units from 1992 to 2005. How difficult would it be for the town to identify the location of these units by these date ranges?
Staff Response: Staff are currently conducting a building stock assessment for the Town’s Existing Building Decarbonization Roadmap, which includes an analysis of physical characteristics including the year each structure was built. Using County Assessor parcel information, staff can identify the locations of residential structures built in those date ranges.
4. An income-qualified renter would need to pay the property’s utility bill in order to be eligible for the program. Does this also mean the property would need to be on a separate meter?
Staff Response: For single-family properties, a renter is eligible (with the property owner’s permission) if they meet all program criteria and pay the utility bill directly. Under current weatherization programs, multi-family properties are eligible for whole-building upgrades if a certain percentage of tenant households meet income
eligibility criteria. In this case, the property owner is an eligible applicant, and tenants do not need to individually apply. Multifamily income qualification thresholds for existing weatherization programs are as follows:
Energy Savings Assistance Program:
Deed-restricted properties: 65% of tenant households meet income qualification
Non deed-restricted properties: 80% of tenant households meet income qualification
Federal Weatherization Assistance Program:
2-4 units: 50% of units meet income qualification
5+ units: 66% of units meet income qualification
Staff recommend including a similar program for multifamily properties in the Truckee Weatherization program, and will work with the program administrator to determine appropriate qualification thresholds as part of program development.
5. Can mobile-home households who meet the other requirements be able participate in the program?
Staff Response: Yes, mobile homes are eligible for most existing weatherization programs and would be eligible for this proposed program as well. Mobile homes may not be eligible for all covered measures under the weatherization program, as they are structurally different than other types of homes.
6. Will tenants of our low-income tax credit apartments who meet the income requirements be able to participate in the program?
Staff Response: These properties would be eligible for whole-building upgrades if they meet the multifamily program criteria, and may be eligible for existing weatherization programs. Newer buildings may not qualify because they are already efficient enough that they do not need any weatherization upgrades covered under the program.
7. Are there any programs for Truckee households that exceed the income cap that would incentive their participation in the first two elements of the proposed program (a home assessment and recommended weatherization measures)?
Staff Response: The TDPUD weatherization rebates are available for all income levels, and with the Town’s matching rebate program, all heating fuel types. Other utility-funded energy efficiency rebates may apply. All households would also be able to participate in the Climate Transformation Alliances Truckee-Tahoe Building Decarbonization Pilot Program, which provides one-on-one coaching and technical assistance to property owners to implement building decarbonization measures, including identification of available rebates and incentives. Energy burden for Truckee households above 80% AMI is low, with these households only spending an average of 2% of income on energy costs.
8. Next steps include having the program administrator engage with the Contractors Association of Truckee-Tahoe. Has CATT or staff suggested how CATT can help make the Weatherization Program more successful?
Staff Response: Town staff met with contractors working on existing weatherization programs in the region to discuss barriers to implementation and get recommendations for how the Town could improve program success. If the proposed weatherization program is approved, Town staff will meet with the program administrator and CATT to jointly define the program details. Staff anticipate that CATT’s expertise will be helpful in determining program criteria such as eligible measures and not-to-exceed costs, as well as identifying how the program can support the local contractor workforce.
7.3: In Lieu Fees
1. The staff report refers to in-lieu fees that were “based on the subsidy required to bridge the gap of the development costs less the supportable value (rent/sale price) for market rate and affordable housing.” Does “market rate” housing in this context refer to income-restricted, home-ownership projects and “affordable housing” to income-restricted, apartment-rental projects? If not, can you re-phrase how this gap is calculated, or show an equation, including how the “supportable values” for market rate and affordable housing are determined?
Staff Response: “Market rate” refers to non-deed restricted units both for-rent and for- purchase products. “Affordable housing” a refers to income-restricted, both for-rent and for- purchase products. The 2017 BAE study is attached for reference, which provides the assumptions and calculations for the in-lieu fee calculation.
2. The gap in 2017 was calculated at $265,281. Using the same calculation method, what would the current gap be?
Staff Response: This would require a new nexus study. If the Council would like to use the gap analysis to identify the appropriate in-lieu fee amount, then staff would recommend that a new calculation study be conducted.
3. BAE determined that “the local percentage subsidy for affordable housing averages to be 16% among five projects with local funding.” Was the local percentage subsidy calculated as a percentage of the total development cost or something else?
Staff Response: It was based on applications for state and federal funding submitted to the California Tax Credit Allocation Committee in 2016 and 2017. From the 2017 BAE study: This research identified 12 projects proposed for development in El Dorado, Nevada, and Placer counties, five of which include local municipal funding sources as part of their permanent financing structure. In total, local funding represented a weighted average of 7.1 percent of project costs, which includes projects that had zero local contribution. If the project list is
limited to those that received funding from local governments entities, as is BAE’s recommendation, the local funding percentage averages 16.0 percent.
4. What were the local percentage subsidies for Artist Lofts, Coburn Crossing, Frishman Hollow II, and Coldstream Commons; are they also about 16%?
Staff Response: Specific percentages for Town assisted funding is difficult to calculate at this time. However, in general terms, here is how the Town supported the selected projects:
Artist Lofts: The Artist Lofts was a $36m project with $1.65 of Town funding, infrastructure assistance, and land provided by the Railyard developer negotiated as part of the Development Agreement.
Coburn Crossing: The Town prioritized the construction of the roundabout adjacent to the project.
Frishman Hollow II: The Town provided the land for the project.
Coldstream Commons: The Town provided assistance in the application for funding but no Town funding was provided.
5. What was the nature and size of the residential unit that was used as a prototype to calculate a $438,591 construction cost in 2017?
Staff Response: From the study: The rental prototype includes eight one-bedroom and eight two-bedroom units. The one-bedroom units are 650 square feet in size, while the two- bedroom units are 950 square feet in size. The rental prototype is located on a 0.9-acre site.
The analysis assumes that tenants are evenly split between two- and three-person households, depending on unit size. The for-sale prototype includes 16 two-bedroom units at 1,200 square feet each. The for-sale prototype is located on a 1.07-acre lot. Buyers are assumed to have three-person households.
6. What would be the cost of constructing the same prototype today (the one that would have cost $438,591 in 2017)?
Staff Response: A new fee calculation study would be required to be completed to identify this cost.
7. If the council were to choose an in-lieu fee based on 20% of the current average cost of construction of each unit (both “for-sale and for-rent prototypes”), what would be the amount of that fee?
Staff Response: A new fee calculation study would be required to be completed to identify this cost.
8. Is the median sales price for housing based solely on single-family home sales? Does it include existing as well as new homes?
Staff Response: It is based solely on single-family homes and on both existing and new homes.
9. Staff refers to an “actual gap between the cost of construction of the affordable units and the rental/mortgage returns for the restricted units in 2017.” What is meant by “rental/mortgage returns” and how was this gap calculated? Does “affordable units” in this context refer to for- rent apartments only or also for-sale, single-family homes?
Staff Response: The rental/mortgage returns reference the revenue generated from a project. The rents and mortgages were based on existing conditions in the market at the time of the study. The cost of construction of the units was compared to the revenue generated by the project. The housing prototypes for this project identified in Question #5 were used for both affordable and market rate units.
10. Has the in-lieu fee fund been used exclusively for large apartment projects and income- restricted single-family home projects?
Staff Response: The in-lieu fee fund has been used to support affordable housing projects.
11. Staff identifies two projects as being required to pay only a portion of their in-lieu fees (Crestwood Construction, 66% and Zurich Place Office, 69%). Why are they not required to pay the full fee?
Staff Response: Based on the Workforce Housing Ordinance, smaller projects that do not generate enough employees to require one full affordable housing unit are not required to construct units. Similarly, projects that may be required to provide full housing units plus a fraction of a unit can fulfill that fraction of a unit through payment of the in-lieu fee. Past decisionmakers determined that smaller projects could not bear the burden of constructing a full unit when a full unit is not required. Additionally, past decisionmakers determined that when a fraction of a unit is required, an in-lieu fee is appropriate. Much of these decisions were based on input from community stakeholders.
12. Staff describes Skislope Townhomes as paying 20% of the in-lieu fee, even though 50% of the four units will be deed-restricted. Why is the developer having to pay in-lieu fees if the restricted units exceed 15% of the total units?
Staff Response: The Town has requirements that at least 90% of the required density must be met on sites zoned for multi-family residential zoning. Projects that comply with this requirement are only required to provide the base 15% inclusionary housing requirement.
For projects that reduce density below the 90% density, a sliding scale is applied which
allows a reduction in density in exchange for an increased proportion in affordable housing beyond the 15%. The purpose of this ordinance is to ensure that properties are developed as envisioned by the Town’s governing documents and that lower density projects aren’t incentivized (lower number of units proposed would require a fewer amount of affordable housing units per the proportionate inclusionary housing requirements). The project proposed 50% of the allowed density. The project was required to provide 2.2 affordable housing units.
13. The staff report lists what appear to be more than 12 projects that have been approved with workforce housing requirements. How many projects with workforce housing requirements does staff anticipate coming up for town approval before the next housing element is approved?
Staff Response: It is unknown how many projects will be required workforce housing units.
However, many of our current development projects are in Specific or Master Plan areas where separate workforce housing requirements apply. Many of the projects outside of these areas are smaller and the requirements may not apply.
14. What potential changes does staff presently foresee being considered as part of an update to the Workforce Housing Ordinance?
Staff Response: Staff doesn’t know what changes will be adopted with the Workforce Housing Ordinance, if any. Some items that can be considered are updating the employee generation calculations or the proportion of units required per employee, removing the workforce housing requirement, changing the methodology, changing the requirements for workforce housing, redefining the term “workforce housing.”
15. Can staff identify any current criticisms of the Workforce Housing Ordinance that would help inform the council on the appropriate timing of the next update? Staff Response: Some comments we’ve received on the ordinance: Nonresidential project developers don’t know how to develop housing; is housing with nonresidential uses appropriate in all cases; deed restricted units are not desirable for property owners; the Workforce Housing Ordinance employee generation numbers/proprtion calculations are low.
Hilary Hobbs (she/her)
Assistant to the Town Manager
Town of Truckee
(530)-582-2914
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