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CC 05-14-2024 Item No. 1. Housing Element_Staff PresentationCC 05-14-2024 #1 Housing Element Presentation City Council May 14, 2024 6th Cycle Housing Element Update Adoption CC 05-14-2024 Item No. 1 Agenda Housing Element Overview Outreach Summary RHNA/Priority Sites Policies and Strategies HCD Review and Comments Environmental Review Associated GP amendments Planning Commission Recommendation Next steps Housing Element Overview What is a Housing Element? Why Update it? What is a Housing Element? State-mandated Element of City’s General Plan Why update it now? Required to be updated every 8 years by law Update by when? By Jan. 31, 2023 (deadline passed) Update it? How? Study and plan for housing needs in community between 2023-2031, across all income levels Who certifies compliance? CA Dept of Housing and Community Development (HCD) HE Contents Housing Needs Assessment Demographic Trends Housing Market Trends Special Needs Groups Constraints to Housing Development Resources and Sites Inventory Policies and Programs Governmental and Non- Governmental Market Trends Environmental Infrastructure Zoning and Capacity ADUs and Mobile Homes Inventory of Sites Review of Previous Housing Element Implementation Identify 2023- 2031 Programs Assessment of Fair Housing Outreach Fair Housing Issues Site Inventory Analysis Contributing Factors Other updates Conforming General Plan changes: Land Use and appendices – Internal consistency Mobility and appendices – address environmental assessment/mitigations Conforming Rezoning – Specific plan, map and text State law requirements – Health and Safety Element Other – necessary to implement HE programs (e.g. Objective design standards for housing developments) 6th Cycle vs. 5th Cycle RHNA 4x higher in Cupertino--4,588 vs. 1,064 Few remaining undeveloped sites, reliance on redevelopment to meet RHNA 62 properties, 36 development sites 70% of properties 50 units/acre or more New legislation adds requirements in: Developing policies/programs Greater accountability to produce housing Site selection Less discretion approving housing developments Affirmatively Furthering Fair Housing (AFFH) More outreach and inclusion Noncompliance What can happen if City does not have a certified Housing Element? Loss of local land use and zoning control – Builder’s Remedy projects Lawsuits and attorney fees Ineligibility for grant funding Financial penalties, court issued fines Streamlined ministerial approval of projects Court receivership appointing an agent to bring City’s Housing Element into compliance Affirmatively Furthering Fair Housing (AFFH) AB 686 (2018) defines AFFH as: “taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics.” Cupertino - High or Highest Resource for Access to Opportunities Housing anywhere in City would regionally AFFH Must look to accommodate persons who currently do not reside in City Meeting RHNA alone does not equate to satisfying AFFH (HE-1.3.6: Missing Middle Strategy) Three community meetings focused on AFFH held May- September 2022 Outreach Summary Outreach Summary 2021 Jt. Study Sessions (Apr & May) Comm. Mtgs (Aug & Dec) CC Mtg (Sept) HC Mtg (Dec) Jan – Jun 2023 Jul – Dec 2022 CC Mtgs (Aug, Nov) PC (July) CEP-SAC mtgs (Jul, Sep, Oct) Comm. Mtg (Jul, Sep) Jan – Jun 2022 PC mtgs (Jan, Feb, Apr, May, June) CC mtgs (Mar) HC mtg (Jun) CEP-SAC mtgs (Mar, Apr, May, Jun) Comm. Mtg (May) Jan –Mar 2024 CC Mtg (Jan) 1st Draft to HCD (2/3) Comments from HCD (5/4) CC Mtg (Jul) Comm. Mtgs (Aug, Sep) 3rd Draft to HCD (2/26) Revised 3rd Draft to HCD (3/28) Conditional Certification letter from HCD (4/10) Jul – Dec 2023 2nd Draft to HCD (10/16) Revised 2nd Draft to HCD (11/30) Comments from HCD (12/15) RHNA/Sites Inventory ABAG RHNA State-wide Housing Needs Determination made by HCD for each region within State Cupertino in 9 County ABAG region City’s RHNA ~1% of ABAG region’s RHNA and ~3.5% of county RHNA Income Group Units % of total Very Low Income (<50% of AMI)1,193 26.0 Low Income (50%-80% of AMI)687 15.0 Moderate Income (80%-120% of AMI)755 16.5 Above Moderate Income (>120% of AMI)1,953 42.5 Total 4,588 100 Affordable Units = 2,635 City’s 6th Cycle RHNA Buffer ~ 35% particularly for lower income levels recommended to ensure city does not have to update sites inventory before next HE update for “no net loss” purposes. RHNA + Buffer accommodates over 6,200 units. Pipeline State law allows credit for approved projects, referred to as pipeline Cupertino allowed ~2,450 units as pipeline Lower income: 633 Moderate income: 49 Above moderate income: 1,770 Identify sites to accommodate balance of RHNA plus buffer Pre-HE Submittal Inventory Started with all potential sites throughout the City which: Met HCD size criteria: 0.5 – 10 acres Outside of fire hazard and geologic hazard zones – more environmental impacts Owner interest a factor Due to recent development approvals, allow: More housing west of De Anza Blvd & south of 85 Less housing east of De Anza Blvd Locate housing sites to counteract declining school enrollment Avoid displacement of existing residents through redevelopment of residential properties Policy Framework State laws: link land use and transportation (AB 32 and SB 375) Regional plans (Plan Bay Area 2050 and Regional Transportation Plan) align with state law AB 2011 (eff. July 1, 2023): Allows Residential development on Commercial-Office Corridors regardless of Zoning: Density and building height varies depending on lot size and width of transportation corridor Identifies min. development standards Ministerial, exempt from CEQA Current Site selection strategy With Council direction in July 2023, site selection strategy adjusted based on: New State law realities – AB 2011/SB6 Proximity to transportation – AB32/SB375 Aligning with regional plans – PBA2050 & RTP City’s existing policies – LU-1.1 & CAP Consultant experience based on likelihood of site acceptance by HCD Size of sites – 0.5 acres (min.) to 10 acres (max.) Development potential of site Current Housing Element Priority Housing Sites Capacity compared to RHNA RHNA Category 2023-2031 RHNA Pipeline Capacity Residential Site Capacity with Rezone Mixed Use Site Capacity with Rezone Projected ADUs Total Capacity Surplus Very Low 1,193 633 833 596 116 2,178 298 Low 687 Moderate 755 49 360 436 57 909 154 Above Moderate 1,953 1,770 662 695 19 3,166 1,213 Total 4,588 2,452 1,855 1,727 192 6,226 1,638 Programs and Policies Required Programs and Policies Programs to provide Adequate Housing Sites Programs to Assist Lower-Income Housing Development Programs to Address Housing Constraints Programs to Conserve, Improve and Expand Housing Stock Programs to Affirmatively Further Fair Housing Programs to Preserve ”at risk” Units Programs for ADUs/Second Units Housing Policy Areas Programs to provide Adequate Housing Sites: Identify sites to accommodate RHNA Create new land use designations to ensure RHNA can be accommodated Programs to Assist Lower- Income Housing Development: Support Grant applications; Provide technical support; Issue NOFA for BMR Affordable Housing Funds Housing Policy Areas (cont.) Programs to Address Housing Constraints: Adopt Objective standards, Continue fee waivers for affordable units and/or 100% affordable projects; Evaluate Parking standards Programs to Conserve,Improve and Expand City Housing Stock: Create new R4 Zoning District; Promote options for multi- generational households & house sharing; Continue to implement a BMR program Disallow conversion of multi- family to Single Family homes; Use CDBG funds for conservation/ improvements Housing Policy Areas (cont.) Programs to Affirmatively Further Fair Housing: Upzone sites adequately to allow accommodation of RHNA; Support teacher housing and ELI projects; Continue to support the development of ADUs and adopt "missing middle" housing policies, which offer opportunities with modest increases in density (HE Strategy-1.3.6) Housing Policy Areas (cont.) Programs to Preserve ”at risk” Units: Programs to meet with affordable housing operators annually Programs for ADUs/Second Units: Continue to offer streamlined pre-approved plans; Evaluate and participate in local and regional efforts on ADU programs HCD Review and Comments Process with HCD February 3, 2023: 1st submittal to HCD May 4, 2023: 16 page letter #1 received October 16, 2023: 2nd submittal to HCD Informal meeting with HCD resulted in Revised 2nd draft submitted to HCD on Nov. 30, 2023 December 15, 2023: 5 page letter #2 received February 26, 2024: 3rd submittal to HCD Informal meeting with HCD staff resulted in Revised 3rd draft submitted to HCD on March 28, 2023 April 10, 2024: CONDITIONAL COMPLIANCE LETTER RECEIVED FROM HCD Revisions to address HCD comments Second draft (Oct/Nov) – substantial rewrite of first draft based on HCD comments from May All analysis (review of prior housing element, fair housing, needs and constraints analysis) revised Sites inventory updated based on Council direction and consultant advice Existing policies and strategies revised New policies and strategies added in first draft revised or replaced/added to address state law, HCD comments, AFFH Third draft (Feb/Mar) – targeted edits to second draft based on HCD comments Related to sites and sites inventory Refinements to missing middle strategy Environmental Assessment Settlement/Environmental Assessment February 2023: California Housing Defense Fund/YIMBY Law sue City for noncompliant HE by adoption deadline January 2024: Stipulated Judgment entered into Established schedule to complete HE update in compliance with State law Gov’t Code Sec. 65759(a) CEQA does not apply to actions to bring HE into compliance with Court Order. Environmental Issues Analyzed Aesthetics Air Quality Biological Resources Cultural and Tribal Cultural Resources Energy Geology and Soils GHG Emissions Hazards and Hazardous Materials Hydrology and Water Quality Land Use and Planning Noise Population and Housing Public Services, Parks, and Recreation Transportation Utilities and System Services Wildfire Any significant environmental impacts are avoided, minimized, rectified, reduced or eliminated, and/or compensated. The General Plan incorporates policies and strategies to protect, preserve, and/or enhance environmental resources. The following topics were evaluated in environmental assessment: Environmental Assessment Conclusions EA builds off 2015 General Plan EIR –Mitigation Measures for air quality, biological resources, hazardous materials, transportation, and utilities and services systems. Cupertino Municipal Code Chapter 17.04, Standard Environmental Protection Requirements –In 2019, Municipal Code codified 2015 GP EIR mitigation measures as environmental protection requirements for all construction projects. 2024 General Plan Policies and Strategies –Policies and strategies updated to reflect current best management practices to ensure that future development continues to reduce impacts from construction and operation phases (e.g. Mobility Element) Environmental Assessment Conclusions Program-level significant and unavoidable impacts for air quality, greenhouse gas emissions, and transportation (vehicle miles traveled). Possible to have less-than-significant impacts in these areas for future projects that meet project-level thresholds. No additional mitigation measures are available at this phase of project approval (i.e. adoption of HE and associated amendments) Associated General Plan Amendments Other General Plan Amendments Chapter 3, Land Use and Community Design Element and Appendix A, Land Use Designations: Text changes to address state law requirements & Housing Element requirements Figure changes – reflect density and heights reqd. for developing Priority Housing Sites Chapter 5: Text changes to minimize environmental impacts resulting from development General Plan Land Use Map – conforming changes Planning Commission Recommendation Planning Commission Recommendation April 29, Planning Commission recommended adoption of draft resolution on a 3-2 vote (Sharf and Madhdhipatla: no) with minor change to remove a site not allowed as a Priority Housing Site by HCD Missing middle strategy and parkland dedication fee study discussed. HCD requirements to address AFFH and housing constraints 8 members of public spoke – topics included validity of RHNA numbers, missing middle strategy and parking impacts, specify income restrictions for BMR AHF Funds for residential rehabilitation projects, policies should cover programs for seniors, prevailing wage requirements for development projects, and questions about environmental review Next Steps Timeline and Next Steps April 2024 Letter from HCD – 4/10 HC Study Session – 4/25 PC rec. – 4/29 Summer 2024 Fall 2024June 2024 First reading – 6/18 May 2024 CC adoption – 5/14 PC rec. On zoning – 5/28 Mar 2025 Complete rezoning Prepare objective design standards Adopt objective design standards APR submitted Ignore slides from here on out HE Overview What is a Housing Element? State-mandated Element of City’s General Plan Why update it now? Required to be updated every 8 years by law Update it? How? Study and plan for housing needs in community between 2023 & 2031, across all income levels Update by when? By Jan. 31, 2023 (deadline passed) HE Overview 6th Cycle Housing Element update covers 2023-2031 Planning Period Certification deadline: Jan. 31, 2023 (passed) Six jurisdictions in Santa Clara County (15 cities/1 county) still do not have compliant Housing Elements 38 of 109 ABAG jurisdictions not in compliance 58 of 197 SCAG jurisdictions still out of compliance R1 lots adjacent to commercial could develop with R2 standards ~240 lots R1 corner lots that could develop with R2 standards ~1,440 lots R1 lots adjacent to commercial & corner lots that could develop with R2 standards ~1,680 lots What’s happened so far? Community meetings – Aug & Dec 2021 AFFH focused meetings: May 2022 – Unhoused, Veterans & individuals with disabilities Jul 2022 – Students and Seniors Sept 2022 – Cash-poor/House rich and workers Council directs staff to submit Draft HE to HCD – Nov 2022 Draft HE submitted to HCD – Feb 4, 2023 New Consultant approved – Mar 2023 NOP for EIR sent to OPR’s clearinghouse – Apr 2023 EIR scoping meeting – April 18, 2023 Comments received from HCD – May 4, 2023 Public Meetings Over 30 public meetings since Fall 2021 Joint Study Sessions: HC/PC/CC - April/May 2021 (2 mtgs). Community meetings:May 2022-Sept 2023, (5mtgs) City Council: Sept 2021 – July 2023 (9 mtgs) Housing Commission: Dec 2021, Jun/Jul 2022 (3 mtgs) Planning Commission: Jan 2022 – Jul 2022 (6 mtgs) Community Engagement Plan – Strategic Advisory Committee* – Mar 2022 – Oct 2022 (8 mtgs) * Two councilmembers, HC Chair and PC Chair RHNA Buffer Why do you need a RHNA Buffer? SB166 (2017): No net loss law Mandates that jurisdictions must maintain adequate site inventory to accommodate remaining unmet RHNA by each income category at all times How much is recommended? ~ 25 - 35% particularly for lower income levels to ensure city does not have to update sites inventory before next HE update Land use and Transportation State laws focus on linking land use and transportation to align with AB32 (2006) and SB375 (2008) – Climate Change and GHG reduction Regional plans (Plan Bay Area 2050 and Regional Transportation Plan) align with state law: Identifies Heart of the City as Priority Development Area Identifies transportation investment to support growth to reduce GHG City’s policies align AB 2011/ SB 6 SITE DENSITY Site < one (1) acre 30 du/acre Site > one (1) acre and Commercial Corridor right-of-way < 100 feet 40 du/acre Site > one (1) acre and Commercial Corridor right-of-way > 100 feet 60 du/acre Site within one half-mile of Major Transit Stop (N/A in Cupertino)80 du/acre AB 2011 Sites Pipeline Projects Account for 2,452 units in Draft HE Likely 1,779 units will be “allowed”at Vallco (west side only) Elimination of Hamptons (600 units) from pipeline If developed by 2031, City still gets credit for all built units Upcoming HE Meetings April 16: City Council Study Session Overview and Policy Discussion April 25: Housing Commission: Study Session April 29: Planning Commission meeting: PC recommendation to Council May 14: City Council meeting Adopt HE, Amend GP including Environmental Assessment, Rezone Priority Housing Sites and related Code changes to implement HE AB2011 with HCD size criteria & Aug 2022 sites AB2011 with HCD size criteria with Housing Priority sites Goals, Policies and Programs Council Direction July 2023: In addition to refining site selection strategy, directed priority for housing policy areas among the following: Assist lower income households Address constraints Conserve and Improve Housing Stock Affirmatively Further Fair Housing Preserve “at risk” units ADUs/Second Units Santa Clara County 6th RHNA Cycle Income Group Units % of total Very Low Income (<50% of AMI)1,193 26.0 Low Income (50%-80% of AMI)687 15.0 Moderate Income (80%-120% of AMI)755 16.5 Above Moderate Income (>120% of AMI)1,953 42.5 Total 4,588 100 Affordable Units = 2,635 Cupertino’s 6th Cycle RHNA Sites - August 2022 AB2011 with HCD size criteria Initial HCD comments Received May 4, 2023 General in nature, but comprehensive Asks for more analysis in several areas Some comments do not apply to City (e.g. manufactured homes/ADUs) No specific feedback on Sites Inventory, except pipeline (discussed earlier) Second Draft HCD comments Received December 15, 2023 Fewer comments and more specific in nature Still asks for more analysis in a few areas, particularly regarding sites’ development potential within 6th Cycle timeframe Some feedback on Sites Inventory, other than pipeline Recent informal comments from HCD Strengthen Missing Middle Policies for Fair Housing purposes (Strategy HE 1-3-6) Provide additional site analysis-Improvement to Land Value and support for sites where redevelopment is less certain Continue to streamline and promote development of ADUs Take more proactive approach to ensure housing is produced Rezone Sites to Meet the RHNA Map Detail 1 Map Detail 2 Map Detail 3 Revisions to address HCD comments Review of Previous Housing Element More info in implementation of previous actions, including impact on housing for persons with special needs Fair Housing Analysis Expanded discussion on trends, patterns, and data to further fair housing including displacement risk and fair housing sites analysis Housing Sites Inventory Revised site analysis including adding likelihood of development, realistic capacity, utility providers, small sites analysis, analysis re: ADUs to align with HCD accepted methodology Housing Needs Assessment and Constraints Identified need to comply with State law for several housing types (SROs, shelters) Expanded discussion regarding permit processing and how current land use controls are not a constraint and identify constraints such as housing for persons with disabilities, conversion-risk-estimate, and non-governmental related impacts Revisions to address HCD comments Housing Strategies Revise rezone strategy to ensure compliance with State law and create new zoning and GP land uses to implement rezone. (Strategies 1.3.2, 1.3.3) Added strategies to encourage and facilitate: Mixed use development (Strategy 1.3.5) Development of non-vacant sites (Strategy 1.3.4) Development of affordable housing (Strategy 1.3.4, 1.3.5, 1.3.6, 1.3.7, 1.3.8, 1.3.10, 2.3.1, 2.3.2, 2.3.4, 2.3.6, 2.3.7, 2.3.10, 2.3.11, ) Development on small lots (<0.5 acres) (Strategy 1.3.7) Development on Surplus Properties and Faith Based-Housing (Strategy 2.5.6) Live/Work Units (Strategy 2.3.12) Revisions to address HCD comments Housing Strategies Track Housing Production and complete a mid-term evaluation on production. (Strategy 1.3.12) Establish priority processing and granting fee waivers or deferrals for affordable housing developments. (Strategies 1.3.4, 1.3.5, 1.3.7, 1.3.8, 2.3.1, 2.3.9 2.3.11) Revise programs to AFFH including adding fair housing metrics, geographic targeting, actions to promote mobility and increase housing choices ((Strategies 6.1.1, 6.1.2, 6.1.3 and metrics to all strategies) Revised to establish incentives beyond ADU law and monitor affordability (Strategy 1.3.8). Study rent stabilization and tenant protection ordinances in California (Strategy 3.3.6) Revisions to address HCD comments Housing Strategies Added strategies to comply with State law concerning: Emergency Shelters (Strategy 5.1.1) Low Barrier Navigation Centers and Supportive Housing (Strategy 5.1.4) Residential Care Facilities (Strategy 5.1.5) Manufactured Homes (Strategy 5.1.6) Density Bonus (Strategy 2.3.8) Accessory Dwelling units (Strategy 1.3.8) Added actions to encourage missing middle housing types (Strategy 1.3.6) including duplexes, triplexes, courtyard apartments Allowing corner lots in R1 to develop with R2 standards Allowing R1 lots that abut property that fronts an arterial or major collector that is zoned and used for commercial or mixed-use development, to develop using R2 standards Revisions to address HCD comments Housing Strategies Review and revise development standards (Strategy 1.3.9) Parking, setbacks, lot coverages, height limits, etc. in the new R-4 and PDA Explore innovative and family –friendly housing options (Strategy 1.3.10) Promote housing designs and unit mix to attract multigenerational households Research possibility of a Home Sharing program that would help to match “providers” with spare room(s) with “seekers” who are looking for affordable places to live. Quantified Objectives Revised objectives for housing rehabilitation and conservation and to address fair housing. Consistency with General Plan Added a program to review for consistency throughout planning period. Significant and Unavoidable The General Plan meets regional goals, objectives, and best management practices for reducing environmental impacts. Program-level significant and unavoidable impacts were determined for air quality, greenhouse gas emissions, and transportation (vehicle miles traveled). Program-level significant and unavoidable impacts are based on: Unknown project-specific details of future proposed development projects Consistency with regional plans that have yet to be updated Human behavior Direction Pre-HE submittal More interest in accommodating housing west of De Anza Blvd and south of Highway 85 Less interest in accommodating housing east of De Anza Blvd due to recent approvals Locate housing sites to counteract declining school enrollment Avoid displacement of existing residents through redevelopment of residential properties Affirmatively Furthering Fair Housing (AFFH) - Cupertino City is designated High or Highest Resource regarding Access to Opportunities Housing anywhere in City would regionally Affirmatively Further Fair Housing City must look to accommodate persons who currently do not reside here Meeting RHNA alone does not equate to satisfying AFFH (Missing Middle Strategy)