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HomeMy WebLinkAboutHC 08-13-2026 PresentationsHC 08-13-2026 #2 Study session to examine the City’s Below Market Rate (BMR) Housing Mitigation Program Procedural Manual (Housing Mitigation Manual) Presentations This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Nicky Vu, Senior Housing Coordinator August 13, 2026 Housing Mitigation Manual Study Session This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Housing Mitigation Manual ●Below Market Rate Housing Mitigation Program Procedural Manual ●Adopted by Council in 1992 ●Generate affordable housing through market rate development ●Inclusionary Housing Requirement ●Below Market Rate Affordable Housing Fund This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Inclusionary Housing Requirement Requires developers to set aside a percentage of their development to sold/rented to income qualifying households at designated affordability levels Income Level AMI Requirement Acutely Low Below 15%None Extremely Low 15% - 30%None Very Low 30% - 50%9% of rental Low 50% – 80%6% of rental Median 80% - 100%10% of ownership Moderate 100% - 120%10% of ownership This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Below Market Rate Affordable Housing Fund ●Fee collected upon building permit issuance ●Eligible affordable housing uses: ●Acquisition ●Construction ●Preservation ●Rehabilitation ●Operation subsidies ●BMR program administration ●Fair Housing ●Other low-income housing activities This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Regional Housing Needs Allocation (RHNA) Assigned by HCD to Cities and Counties for each to provide their “fair share” of housing at various income levels for equitable and commensurate affordable housing to meet population and economic growth Income Level AMI Requirement Very Low Below 50%1,193 Low 50% – 80%687 Moderate 80% - 120%775 Above Moderate Above 120%1,953 Total All 4,588 This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Housing Element ●HE – 2.3.3 (Residential Housing Mitigation Program) ●Analyze and update the inclusionary housing program ●HE – 2.3.9 (Review Impact Fees) ●Analyze and update the BMR fees This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Fee Structure Two components for fee collection into the BMR AHF fund Fractional Fee Commercial Linkage Fee •Collected from residential projects •Calculated to represent the remaining fraction of the unit provision requirement •Collected from commercial projects •Calculated to ensure job/wage growth is tied to affordable housing supply This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Fractional Fee ●City’s inclusionary housing requirement often results in a non-whole number of required BMR units Example: Rental project with 22 units would be required to provide 1.98 very low income and 1.32 low income units. If the fractional portion > 0.50, then round up. If the fractional portion < 0.50, then pay the fractional fee. The formula to calculate this fee is as follows: Therefore, provide 2 very low income units, 1 low income unit, and pay $145,163.63 to the BMR AHF This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Commercial Linkage Fee ●Based on square footage and use type ●Lower wage use types (retail) have lower fees while high wage use types (office park) have higher fees ●Current categories: ●Office/research ●Hotel ●Self-storage facility ●Warehouse ●Commercial/retail This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Update Goals ●Current with state law and development environment ●Compatible with regional best practices ●Equitable for affordable housing ●Legally defensible ●Financially feasible ●Meet RHNA This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV This section may be cropped for TV Next Steps ●Consultant to study ●2026 Housing Commission Meeting ●2027 City Council .