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2018/07/12 Planning Commission Resolution PLANNING COMMISSION RESOLUTION NO. 2018-12 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF ROHNERT PARK, CALIFORNIA RECOMMENDING TO THE CITY COUNCIL AMENDMENTS TO MUNICIPAL CODE TITLE 17, ZONING TO MODIFY INCLUSIONARY HOUSING REQUIREMENTS WHEREAS, the applicant, the City of Rohnert Park, filed Planning Application No. PLMC18-0002 proposing changes to the Rohnert Park Municipal Code (“RPMC”) by amending Sections 17.07.020 – Footnotes; WHEREAS, the proposed amendments are in response to City Council direction from October 24, 2017 and April 10, 2018; WHEREAS, an inclusionary housing in-lieu fee study was prepared by Economic and Planning Systems, Inc.; WHEREAS, the proposed changes to Title 17 Zoning are consistent with the goals, policies, and implementation measures in the General Plan; WHEREAS, the proposed changes to Title 17 Zoning are attached hereto as Exhibit A; WHEREAS, pursuant to California State Law and the Rohnert Park Municipal Code, a public notice was published in the Community Voice for a minimum of 10 days prior to the first public hearing; WHEREAS, on June 28, 2018 the Planning Commission continued the public hearing on the proposal to July 12, 2018; WHEREAS, on July 12, 2018 the Planning Commission held a public hearing at which time interested persons had an opportunity testify either in support of or opposition to the proposal; and WHEREAS; the Planning Commission has reviewed and considered the information contained in Planning Application No. PLMC18-0002 for the proposed amendments to Title 17 Zoning of the Municipal Code. NOW, THEREFORE, BE IT RESOLVED that the Planning Commission of the City of Rohnert Park makes the following findings, determinations and recommendations with respect to the proposed amendments to Sections 17.07.020.N – Footnotes: Inclusionary Housing based on the entire record of the proceeding, including the oral and written staff reports and all oral and written testimony and comments. Section 1. The above recitations are true and correct. Section 2. Findings. The Planning Commission hereby makes the following findings concerning Sections 17.07.020 – Footnotes of the Municipal Code: 1. That the proposed amendments to the Municipal Code are consistent with the General Plan 2020. Criteria Satisfied. The proposed amendments to the Municipal Code are consistent with the General Plan 2020 Goals and Policies of avoiding unnecessary costs to housing development (H0-3.5). The proposed amendments are also consistent with Programs H0-3.C and H0-3.D which call for the development of an in-lieu fee and the amendment of the inclusionary housing ordinance to remove requirements for market rate rental projects. 2. That the proposed amendment to the Zoning Ordinance will be beneficial to the public health, safety or welfare. Criteria Satisfied. The proposed amendments to the Municipal Code will provide for the health, safety and welfare of individuals living in Rohnert Park by continuing to provide mechanisms for the creation and funding of new affordable housing and the preservation of affordable housing. Section 3. Environmental Clearance No California Environmental Quality Act (CEQA) analysis is required for this ordinance. The proposed ordinance is not a project under CEQA pursuant to CEQA Guidelines section 15378(b)(4), which says that the creation of government funding mechanisms that do not involve a commitment to a particular project do not fall under the auspices ofCEQA. NOW, THEREFORE, BE IT FURTHER RESOLVED that the Planning Commission does hereby recommend that the City Council adopt the Findings stated hereinabove and adopt this Amendment to the RPMC to amend Section 17.07.020-Footnotes in the form provided in Exhibit A. DULY AND REGULARLY ADOPTED on this 12th day of July 2018 by the City of Rohnert Park Planning Commission by the following vote: AYES: !l__ NOES:_Q__ ABSENT:___D__ ABSTAIN:j]_ ADAMSk BLANQUIE¥BORBA.z4L_ GJUDICE.z/o/l.-HAYDON¥ S~lanningCommission Attest: ~----~~-------------------S~san ~- 17.07.020 -Footnotes. N. INCLUSIONARY HOUSING . 1. Purpose. The purpose of this chapter is to establish a housing trust fund and an inclusionary requirement or an in-lieu fee on developers of ownership residential development projects. The fees will be used to defray the costs of providing affordable housing for very low-, low-, and moderate-income households in the city of Rohnert Park. The fees and inclusionary requirements required by this chapter do not replace other regulatory , development and processing fees or exactions, funding required pursuant to a development agreement or reimbursement agreement, assessments charged pursuant to special assessments or benefit assessment district proceedings, etc ., unless so specified. 2 . Definitions. For the purposes of this chapter, the following words, phrases, and terms shall have the meanings set forth herein. Words not defined shall be given their common and ordinary meaning. "Affordable rent" means: (1) monthly rent plus a reasonable allowance for utilities that in aggregate do not exceed thirty percent of eighty percent of area median income for lower income households; and (2) monthly rent plus a reasonable allowance for utilities that in aggregate do not exceed thirty percent of fifty percent of area median income for very low-income households . In each case, the median income applicable to Sonoma County is as determined annually by the United States Department of Housing and Urban Development, adjusted for household size . Affordable rent shall be based on presumed occupancy levels of one person in a studio unit, two persons in a one-bedroom unit, three persons in a two-bedroom unit, and one additional person for each additional bedroom thereafter . "Affordable sales price" means the maximum purchase price that will be affordable to the specified target income household. A maximum purchase price shall be considered affordable only if the owner-occupied monthly housing payment is equal to or less than one-twelfth of thirty percent of income for the specified target income household. Affordable sales price shall be based upon presumed occupancy levels of one person in a studio unit, two persons in a one-bedroom unit, three persons in a two bedroom unit, and one additional person for each additional bedroom thereafter. "Affordable units" means those dwelling units which are required to be rented at affordable rents or purchased at an affordable sales price to specified households . "Annual household income" means the combined gross income for all adult persons living in a dwelling unit as calculated for the purpose of the Section 8 program under the United States Housing Act of 1937, as amended, or its successor. "Building permit" means a permit issued pursuant to Chapter 15.08 of Title 15 of the Rohnert Park Municipal Code. "Building official" means the chief building official of the city of Rohnert Park, or the designee of such individual. "Concession" or "incentive" shall have the same meaning and applicability as set forth in Government Code Section 65915. Concessions and incentives may include, at the discretion of the city, any of the following: (1) a reduction in site development standards, or a modification of zoning requirements or architectural design requirements which exceed the minimum building standards approved by the State, including but not limited to minimum lot size, open space, yard, landscape maintenance, fencing, utility undergrounding, sidewalk, right-of-way dedication (not including curb-to-curb street width standards), parking and/or setback requirements; (2) approval of mixed use zoning in conjunction with the housing project if the non-residential uses will reduce the cost of the residential development and if the city determines that the non-residential uses are compatible with both the housing project and the existing or planned development in the area in which the housing project will be located ; or (3) other regulatory incentives or concessions proposed by the developer which the developer shows will result in identifiable cost reductions , including but not limited to a waiver, reduction and/or reimbursement of taxes and fees which otherwise would be imposed on the project. "Construction costs" means the estimated cost per square foot of construction, as established by the building department of the city of Rohnert Park for use in the setting of regulatory fees and building permits, multiplied by the total square footage , minus the garage floor area, to be constructed . "Developer" means every person, firm , or corporation constructing, placing, or creating residential development directly or through the services of any employee, agent, independent contractor or otherwise. "Dwelling unit" shall have the meaning set forth in Chapter 17 .04 of Title 17 of the city of Rohnert Park Municipal Code. "Housing fund" means the city of Rohnert Park affordable housing trust fund. "Housing in-lieu fee" or "in-lieu fee" means the fee established for ownership residential development projects. "Low-income households" means those households with incomes of up to eighty percent of median income . "Market rate units" means those dwelling units in a residential project which are not affordable units . "Median income" means the median income, adjusted for family size, applicable to Sonoma County as published annually pursuant to Title 25 of the California Code of Regulations, Section 6932 (or its successor provision) by the United States Department of Housing and Urban Development. "Moderate income households" means those households with incomes of up to one hundred twenty percent of median income. "Owner-occupied monthly housing payment" means the sum equal to the principal, interest, property taxes, homeowner's insurance and homeowner's association dues paid on an annual basis divided by twelve. "Residential development project" means a project for the construction or placement of any dwelling unit in a permanent location, or the subdivision of land which is planned, designed, or used for the following land use categories : a. Single-family residential: This category consists of single-family detached units and duplexes. b . Multi-family residential: This category consists of buildings containing three or more dwelling units and mobile home parks . "Very low-income households" means those households with incomes of up to fifty percent of median income. 3. Housing trust fund. a. There is hereby established the city of Rohnert Park affordable housing trust fund (the "housing fund"). Separate accounts within such housing fund may be created from time to time to avoid commingling as required by law or as deemed appropriate to further the purposes of the fund. b. The housing fund shall be administered by the city manager, or his/her designee, who shall have the authority to govern the housing fund consistent with this chapter, and to prescribe procedures for said purpose, subject to approval by the council, and payment for all expenditures must be in accordance with city purchasing and budgetary policies. c. Purposes and use of funds. (1) Monies deposited in the housing fund along with any interest earnings on such monies shall be used solely to increase and improve the supply of housing affordable to households of moderate-, low-and very low-income households; including, but not limited to : (i) Acquisition of property and property rights; (ii) Cost of construction including costs associated with planning, administration, and design, as well as actual building or installation , as well as any other costs associated with the construction or financing of affordable housing; (iii) Reimbursement to the city for such costs if funds were advanced by the city from other sources; and (iv) Reimbursement of developers or property owners who have been required or permitted to install facilities which are beyond that which can be attributed to a specific development. Monies may also be used to cover reasonable administrative expenses not reimbursed through processing fees, including reasonable consultant and legal expenses related to the establishment and/or administration of the housing fund and reasonable expenses for administering the process of calculating, collecting , and accounting for inclusionary housing in-lieu fees and any deferred city fees authorized by this section. No portion of the housing fund may be diverted to other purposes by way of loan or otherwise . (2) Monies in the housing fund shall be used in accordance with the priorities identified in the Rohnert Park community development commission's five-year implementation plan, which must be consistent with the city's housing element, to construct, acquire, rehabilitate or subsidize very low-, low-and moderate-income housing and/or to assist other governmental entities, private organizations or individuals in the construction and rehabilitation of very low-low-, and moderate-income housing . Monies in the housing fund may be disbursed, hypothecated, collateralized or otherwise employed for these purposes from time to time as the city council determines is appropriate to accomplish the purposes of the housing fund. These uses include , but are not limited to, assistance to housing development corporations, equity participation loans, grants, pre-home ownership co-investment, pre-development loan funds, participation leases, or other public/private partnership arrangements. The housing fund monies may be extended for the benefit of rental or owner occupied housing or housing services. 4. Ownership residential development project: lnclusionary requirements . a. lnclusionary requirements. (1) In a for-sale project, at least fifteen percent of all new dwelling units in a residential development of five or more units shall be affordable, and shall be constructed and completed not later than the related market rate units. One half of the affordable units shall be affordable to low-income households and the remaining half shall be affordable to moderate-income households . (2) Notwithstanding the above, this section shall not apply to projects which fall into one or more of the following categories : (i) A residential development project to the extent it has received a vested right to proceed without payment of housing impact fees pursuant to state law. (ii) Building permits for residential development projects if compliance with this section for such project has already been satisfied including, but not limited to, building permits on newly created lots where the subdivider has built affordable units or otherwise satisfied this section. (iii) Any dwelling unit or residential development project which is damaged or destroyed by fire or natural catastrophes so long as the square footage and use of the building remains the same . (iv) A residential development project subject to a development agreement that provides for alternative means of addressing the affordable housing requirements of this section, such as an alternative equivalent action . b. For fractions of required affordable units, the developer may elect, at his or her option, to construct the next higher whole number of affordable units, perform an equivalency action alternative which has received the approval of council pursuant to subsection 4.c, or pay the in-lieu fee specified in subsection 5 for such fraction . c. Alternative equivalent action. (1) A developer of a residential development project may propose to meet the requirements of subsection 4.a by an alternative equivalent action, subject to the review and approval by the city council. (2) An alternative equivalent action may include, but is not limited to, donation of vacant land suitable for housing to a non-profit housing developer, transfer of inclusionary unit credits, construction of affordable units on another site or enforcement of required rental/sales price restrictions on existing market-rate dwelling units consistent with this section, and development of second dwelling units. All applicants proposing the use of an alternative equivalent action shall show how the alternative will further affordable housing opportunities in the city to an equal or greater extent than compliance with the express requirements of subsection 4.a. (i) Land donation. An applicant may donate land to a non-profit housing developer in place of actual construction of required affordable units upon approval of the city council. The dedicated land must be appropriately zoned, buildable, free of toxic substances and contaminated soils. It must be large enough to accommodate the number of required affordable units as indicated by a conceptual development plan . The land that is donated shall include lots that are fully improved with infrastructure, adjacent utilities, and grading, and fees paid . (ii) Transfer of inclusionary unit credits. The requirements of this section may be satisfied by acquiring inclusionary unit credits that are transferable from one residential development project to another, upon approval of the city council and as set forth herein. The city council may approve issuance of a specified number of credit certificates for that number of affordable units provided by a particular residential development project in excess of the minimum number required for the project. Credit certificates shall be issued for specific income categories and may only be used to satisfy the requirements for affordable units within that same income category. If the holder of the credit certificates transfers any or all certificates to a developer of a residential development project, the parties shall report the transaction to the planning and community development director, who will document the transfer . When a credit certificate is applied to meet the affordable unit requirement of a particular project, it shall be recorded at the time of project approval, and the subject certificates must be returned to the community development director. (iii) Second dwelling units. Not more than fifty percent of the requirements of this section may be satisfied through the development of second dwelling units at a ratio of two second dwelling units counted as one affordable housing unit. All second units counted toward meeting the affordable unit requirement shall be subject to the provisions of Section 17.07.020.N.10 -Continued Affordability. Second dwelling units shall only be allowed for meeting the affordability requirements for very-low and low-income households . C. The city council's consideration of an alternative equivalent action shall follow the procedures outlined in subsection 6 An alternative equivalent action shall be considered on a case-by- case basis by the city council and may be approved at the city council's sole discretion, if the city council determines that such alternative will further affordable housing opportunities in the city to an equal or greater extent than compliance with the express requirements of subsection 4.a and that an over concentration of affordable housing in one area will not occur. 5. In-lieu housing fee. a. For fractions of required affordable units or in the case of a residential development project that is on less than one acre or proposes 50 units or less and is not, and has not been, part of a larger residential development project, a developer of a residential development project may propose to meet the requirements of subsection 4.a by submitting at the time of application for a discretionary or building permit, whichever comes first, a request to pay the in-lieu fee . b. Time of payment of in-lieu fee. Unless otherwise preempted by law, the housing in-lieu fee shall be paid prior to the issuance of a building permit. c. Calculation of housing in-lieu fee. The housing in-lieu fee shall be based upon a quantified translation of the inclusionary housing requirement of fifteen percent (or ten percent if the project is located in the Central Rohnert Park Priority Development Area), wherein one-half of the affordable units which are required to be constructed shall be available at prices affordable to low-income households. The remaining one-half of the required affordable units shall be available at prices affordable to moderate-income households. d. The amounts and calculation of the housing in-lieu fee shall be established by resolution of the city council. The in-lieu fee shall be calculated to reflect the affordability gap between development costs and the value of the affordable units, based on income levels. The housing in-lieu fee required by this section may be satisfied either by cash payment or upon the recommendation of the city manager and approval of the city council, by an alternative equivalent action which will provide city with a value equal to or greater than the amount of the required in-lieu fee . 6. Affordable housing concessions or incentives . a. For residential development projects, which meet the requirements of Section 17.07.020 .N.4.a the construction of affordable units, the city shall follow the procedures described below and provide concessions and/or incentives as described in Section 17.07.020 .N.2. (1) If requested by the applicant, within ninety days of submittal by the developer of a written preliminary conceptual development proposal describing and specifying the number, type, location and size of the housing development, and identifying any requests for density bonus, additional incentives , concessions or waivers or modification of development or zoning standards, necessary to make construction feasible for the proposed development, including the affordable units, prior to the submittal of any formal application for a discretionary approval (e.g., general plan amendment, rezoning, use permit, tentative subdivision or parcel map or other permit or entitlement), the city council shall review the preliminary development proposal at a public hearing noticed in accordance with Rohnert Park Municipal Code and indicate conceptual approval or disapproval of the proposed development and any requests for additional affordable housing incentives, concessions or waivers or modification of development or zoning standards . Such preliminary approval or disapproval shall not bind the city council but rather shall be subject to the discretion of the city council to modify its preliminary recommendations based upon a full review of all pertinent project information, including any environmental impact report, presented at the public hearing on the application. An application for such a request shall be submitted to the planning and community development director. (2) Complete applications for a residential development project which include all required submittal documents and which include the construction of affordable units shall be processed by all city departments before other residential land use applications regardless of the original submittal date. (3) Payment of all city-required fees on affordable units shall be deferred for payment, but shall be made prior to, and as a condition of, release of utilities and issuance of a certificate of occupancy. b. The city council may consider, on a case-by-case basis, in its sole discretion the provision of the following additional concessions or incentives identified in Government Code Section 65915 which are consistent with state law and the housing element of the city of Rohnert Park general plan for projects which meet or exceed the requirements specified in subsection 17.07.020.N.4.a: (1) An additional density bonus or other incentives of equal financial value subject to the city council's review and approval. (2) Waiver or modification of city standards that have a direct impact on reducing total project costs while remaining consistent with the latest edition of the California Building Code . The developer shall be responsible for documenting that the waiver or modification is necessary for the feasibility of the residential development project and is consistent with all applicable provisions of the California Building Code . (3) Provision of direct financial assistance in the form of a loan or grant using trust fund or other appropriate available funds subject to the recommendation of the city manager. (4) Deferral of payment of all city-required fees on market rate units, but payment shall be made prior to, and as a condition of, release of utilities and issuance of a certificate of occupancy. c. The city council may consider, on a case by case basis, at its sole discretion, the provision of additional concessions or incentives consistent with state law and the housing element of the city of Rohnert Park general plan for residential development projects which provide at least fifteen percent of the total dwelling units as affordable units . 7. Requirements for owner-occupied affordable units. a. One-half of the affordable units which are required to be constructed in connection with the construction of market rate units intended for owner-occupancy shall be available at affordable sales prices to moderate-income households. If one-half of the affordable units required at an affordable sales price to moderate-income households are available at affordable sales prices to households whose annual household income does not exceed one hundred percent of median income, the developer shall be entitled to an additional density bonus of five percent for the proposed development. b. As an alternative to receiving an additional density bonus of five percent, a developer may submit a request for another incentive of a financial value equal to the density bonus. Such requests shall be considered on a case-by-case basis by the city council and shall be approved, at the council's sole discretion, if the council determines that such alternative incentive will further affordable housing opportunities. c. The remaining one-half of the required affordable units shall be available at affordable sales prices to low income households . Where the number of required affordable units is an odd number, the number of units affordable to moderate income households may be one greater than the number affordable to low income households. 8 . Basic requirements for affordable units . Affordable units shall be comparable in number of bedrooms, exterior appearance and overall quality of construction to market rate units in the same residential project. Subject to the approval of the planning and community development director and city manager, square footage of affordable units and interior features in affordable units may not be the same as or equivalent to those in market rate units in the same residential project, so long as they are of good quality and are consistent with contemporary standards for new housing . Affordable units shall be dispersed throughout the residential project, or, subject to the approval of the planning and community development director and city manager, may be clustered within the residential project when this furthers affordable housing opportunities. 9. Continued affordability. a. Prior to the issuance of certificates of occupancy or approval of the final inspection for affordable units, regulatory agreements , resale restrictions , deed restrictions , deeds of trust and/or other documents, all of which must be acceptable to the city manager and consistent with the requirements of this chapter, shall be recorded against parcels having such affordable units and shall be effective for a minimum of forty-five years with respect to each owner-occupied unit. b. Notwithstanding any other provision in this section: (1) the maximum sales price permitted on resale of an affordable unit intended for owner-occupancy shall not exceed the seller's purchase price, adjusted for the percentage increase in median income since the seller's purchase , plus the value of substantial structural or permanent fixed improvements to the property, plus the cost of reasonable seller's broker fee as determined by the city manager; (2) the resale restrictions shall provide that in the event of the sale of an affordable unit intended for owner-occupancy, the city shall have the right to purchase or assign its right to purchase such affordable unit at the maximum price which could be charged to an eligible household. c. No household shall be permitted to occupy an affordable unit, or purchase an affordable unit for owner-occupancy, unless the city or its designee has approved the household's eligibility, or has failed to make a determination of eligibility within the time or other limits provided by a regulatory agreement or resale restrictions if the city or its designee maintains a list of eligible households, households selected to occupy affordable units shall be selected first from that list to the extent provided in the regulatory agreement or resale restrictions . 10 . Annual Monitoring and Transfer Fees. For each rental affordable unit existing as of the date of adoption of this Ordinance, the current owner may be required to pay an annual monitoring fee for the term of required affordability. Such fee shall be specified in the regulatory agreement(s) required hereunder. For each owner-occupied affordable unit provided under this section, the current owner may be required to pay a transfer fee for any change of ownership during the term of required affordability. Such fee shall be specified in the resale restrictions required by subsection 17 .07.020.N.9. 11. Discretionary Permit Requirements . Every discretionary permit for a residential development project of five or more units approved after the effective date of this chapter shall contain a condition detailing the method of compliance with this chapter . Every final and parcel map shall bear a note indicating whether compliance with the requirements of this section must be met prior to issuance of a building permit for each lot created by such map. 12. Requirements for certificate of occupancy/final inspection. a. No temporary or permanent certificate of occupancy shall be issued, final inspection approved or release of utilities authorized for any new dwelling unit in a residential development project until the developer has satisfactorily completed the requirements hereunder, i.e ., on-site construction of affordable units, alternative equivalent action(s) or payment of the housing in-lieu fee. b. No temporary or permanent certificate of occupancy shall be issued , final inspection approved or release of utilities authorized for a dwelling unit described as exempt from the requirements of this chapter in subsection 4 .a above until the developer has made a showing acceptable to the city manager that such an exemption is appropriate . 13. Enforcement Provisions. a. It is unlawful, a public nuisance and a misdemeanor for any person to sell or rent an affordable unit at a price or rent exceeding the maximum allowed under this chapter or to a household not qualified under this chapter, and such person shall be subject to a five hundred dollar fine per month from the date of original noncompliance until the affordable unit is in compliance with this section. b. The Rohnert Park city attorney's office or the Sonoma County district attorney, as appropriate, shall be authorized to abate violations of this chapter and to enforce the provisions of this chapter and all implementing regulatory agreements and resale controls placed on affordable units by civil action, injunctive relief, and any other proceeding or method permitted by law. c. The remedies provided for herein shall be cumulative and not exclusive and shall not preclude the city from any other remedy or relief to which it otherwise would be entitled under law or equity. 14. Adjustment. a. A developer of any project subject to the requirements of this chapter may appeal to the city council for a reduction, adjustment, or waiver of the requirements based upon the absence of any reasonable relationship between the amount of the fee charged and the inclusionary requirement. b. A developer subject to the requirements of this chapter who has received an approved tentative subdivision or parcel map, use permit or similar discretionary approval and who submits a new or revised tentative subdivision or parcel map, use permit or similar discretionary approval for the same property may appeal for a reduction, adjustment or waiver of the requirements with respect to the number of lots or square footage of construction previously approved. c. Any such appeal shall be made in writing and filed with the city clerk not later than ten calendar days before the first public hearing on any discretionary approval or permit for the development, or if no such discretionary approval or permit is required, or if the action complained of occurs after the first public hearing on such permit or approval, the appeal shall be filed within ten calendar days after payment of the fees objected to. d. The appeal shall set forth in detail the factual and legal basis for the claim of waiver, reduction, or adjustment. The city council shall consider the appeal at the public hearing on the permit application or at a separate hearing within sixty calendar days after the filing of the appeal, whichever is later. The appellant shall bear the burden of presenting substantial evidence to support the appeal including comparable technical information to support appellant's position. e . No waiver shall be approved by the city council for a new tentative subdivision or parcel map, use permit or similar discretionary approval on property with an approved tentative subdivision or parcel map, use permit or similar discretionary permit unless the council finds that the new tentative subdivision or parcel map, use permit or similar discretionary approval is superior to the approved project both in its design and its mitigation of environmental impacts . The decision of the council shall be final. If a reduction, adjustment, or waiver is granted, any change in the project shall invalidate the waiver, adjustment, or reduction of the fee or inclusionary requirement.