MONTERY COUNTY2005 GENERAL PLAN UPDATE

STUDY SESSION HOUSING

June 16, 2005

RECOMMENDATIONS1. 1. Retain the current Inclusionary Housing Ordinance requirement Retain the current Inclusionary Housing Ordinance requirement

that 20% of new residential lots or units be deed restricted and that 20% of new residential lots or units be deed restricted and that of the 20%, (6% very low income, 6% low income and 8% that of the 20%, (6% very low income, 6% low income and 8% moderate income).moderate income).

2.2. Require a mandatory Require a mandatory 10%10% contribution for Workforce Level (up contribution for Workforce Level (up to 180% of median income) housing for projects of 10 or more to 180% of median income) housing for projects of 10 or more units/lots to be developed under a separate “Workforce Housing units/lots to be developed under a separate “Workforce Housing Ordinance” which would allow the restrictions to include equity-Ordinance” which would allow the restrictions to include equity-sharing provisions.sharing provisions.

3. 3. Retain the existing policy contained in the Housing Element that Retain the existing policy contained in the Housing Element that encourages employers to voluntarily assist in the production of encourages employers to voluntarily assist in the production of employee housing (Policy H-5.3).employee housing (Policy H-5.3).

4. 4. OPTION: Although not recommended at this time, the Board OPTION: Although not recommended at this time, the Board may also wish to consider adding a program to the Housing may also wish to consider adding a program to the Housing Element in the future requiring the County to develop a new Element in the future requiring the County to develop a new employee housing program that includes a contribution from employee housing program that includes a contribution from new job creating development to a County-wide housing trust.new job creating development to a County-wide housing trust.

RECOMMENDATIONS

5.5. Remove the Affordable Housing Overlay program that is Remove the Affordable Housing Overlay program that is currently contained in the Housing Element (Policy H-3.8) currently contained in the Housing Element (Policy H-3.8) since the same objectives can be achieved by implementing the since the same objectives can be achieved by implementing the Affordable Housing Developer Incentive Program, which will Affordable Housing Developer Incentive Program, which will incorporate the current State Density Bonus provisions, incorporate the current State Density Bonus provisions, without creating a new governmental program. without creating a new governmental program.

6. 6. Do not include a housing allocation system in the Housing Do not include a housing allocation system in the Housing Element as it may affect certification of the Element by the Element as it may affect certification of the Element by the State and could limit overall affordable housing production.State and could limit overall affordable housing production.

7. 7. Once the GPU is adopted, amend the Housing Element to be Once the GPU is adopted, amend the Housing Element to be consistent with the growth pattern established in the Land Use consistent with the growth pattern established in the Land Use Element. Element.

RECOMMENDATIONS

8. 8. Retain the existing policy language in the adopted Housing Retain the existing policy language in the adopted Housing Element to require that public services and infrastructure be Element to require that public services and infrastructure be provided concurrently with housing production.provided concurrently with housing production.

9. 9. Retain the existing policy language in the adopted Housing Retain the existing policy language in the adopted Housing Element which states that the County shall allow secondary Element which states that the County shall allow secondary units in conformance with State law and consistent with units in conformance with State law and consistent with Community and Specific Plans to provide additional housing Community and Specific Plans to provide additional housing opportunities.opportunities.

MONTEREY COUNTY’S HOUSING ELEMENT

Monterey County’s Housing Monterey County’s Housing Element was adopted in 2003. Element was adopted in 2003. It contains policies and programs It contains policies and programs necessary to ensure that the Regional necessary to ensure that the Regional Housing Needs Allocation can be Housing Needs Allocation can be accommodated by 2008.accommodated by 2008.

SUMMARY OF PRIMARY PROGRAMS CONTAINED IN THE ADOPTED HOUSING ELEMENT

 

•Mandatory Inclusionary Program•Voluntary Density Bonus Ordinance Provisions•Voluntary Developer Incentive Program•Plan new communities and intensify existing community areas•Provide infrastructure to new and intensified communities•Housing Rehabilitation Program•Assistance to non-profit housing developers•Replacement housing•Zoning code revisions and Code enforcement•Voluntary employer assisted housing•Special needs housing assistance•Down Payment Assistance Program•Housing Opportunity Center•Expedited Development Review•Second Unit Program•Housing Trust Fund•City/County Coordination of Housing Production

HOUSING PRODUCTION SUMMARY

Between 1989 and 2000 a total of Between 1989 and 2000 a total of approximately 6,500 new residential units approximately 6,500 new residential units were constructed in the County. were constructed in the County.

AFFORDABILITY GAP

In 1999 23% of Monterey County In 1999 23% of Monterey County residents could afford to purchase the residents could afford to purchase the median priced single family home. median priced single family home.

   In 2004 the median price was $565,000 In 2004 the median price was $565,000

and only 15% of the residents could and only 15% of the residents could afford a median price home.afford a median price home.

  In April 2005 the median price In April 2005 the median price increased to $626,000 with no change in increased to $626,000 with no change in the County’s median income of $60,800 the County’s median income of $60,800 for a family of four from 2004.for a family of four from 2004.

REGIONAL HOUSING NEEDS

Monterey County’s Regional Housing Needs Monterey County’s Regional Housing Needs Allocation (RHNA) for 2002-2008 is a total of Allocation (RHNA) for 2002-2008 is a total of 2,511 units as follows:2,511 units as follows:

Very Low Income:Very Low Income: 821821 Low Income:Low Income: 608608 Moderate Income:Moderate Income: 937937 Above Moderate Income:Above Moderate Income: 145145 TotalTotal 2,511 2,511

2005 AFFORDABLE HOUSING

Income Level 3 bedroom Home Price

Very low (50% ) $104,211

Low (80%) $145,861

Moderate

(120%)

$267,554

Workforce I

(140%)

$340,341

Workforce II

(180%)

$437,725

The Housing Element is Required To

Identify sufficient land, zoned at Identify sufficient land, zoned at appropriate densities to achieve the appropriate densities to achieve the allocation.allocation.

The existing Housing Element was The existing Housing Element was required to identify three times the required to identify three times the amount of land required to meet the amount of land required to meet the allocation since residential zoning was allocation since residential zoning was not yet in place. not yet in place.

DENSITY TARGETS 

 

Income Level Density Range

Very low and Low 15 – 30 du/ac

Moderate 10 – 15 du/ac

Above Moderate 1-9 du/ac

QUESTION OF BALLANCE

Need enough market rate Need enough market rate housing to support affordable housing to support affordable unitsunits Return to DevelopmentReturn to Development Carry Infrastructure Carry Infrastructure

Requirements Requirements

WHAT IS THE PRIMARY GOAL OF THE STRATEGY?

To get the right amount of housing To get the right amount of housing built of the right type in the right built of the right type in the right locations at the right price locations at the right price affordable to the residents and affordable to the residents and workers of the County.workers of the County.

WHAT CAN THE COUNTY DO TO ACHIEVE THIS GOAL?

Designate enough land in the Land Use Element for the Designate enough land in the Land Use Element for the right kind of housing in the right locations.right kind of housing in the right locations.

Encourage partnerships with private sector developers Encourage partnerships with private sector developers to build sustainable housing affordable to Monterey to build sustainable housing affordable to Monterey County residents and workers.County residents and workers.

Encourage special needs housing that the private sector Encourage special needs housing that the private sector cannot build. cannot build.

Effectively use government subsidy.Effectively use government subsidy.

Undertake programs that can be feasibly implemented Undertake programs that can be feasibly implemented

given County resources.given County resources.

CONSIDERATIONS

The existing Housing Element includes the following:

Housing Target Areas:Housing Target Areas: Fort Ord, Rancho San Juan, Fort Ord, Rancho San Juan, Pine Canyon, Castroville, Pajaro, Boronda and San Pine Canyon, Castroville, Pajaro, Boronda and San Lucas Lucas

How would the County potentially compensate How would the County potentially compensate for reducing the number of units projected in for reducing the number of units projected in Rancho San Juan? (3,585 Dwelling Units)Rancho San Juan? (3,585 Dwelling Units)

Board previously provided direction to include Board previously provided direction to include additional Rural Centers as housing target areas.additional Rural Centers as housing target areas.

Affordable Housing Contribution

1. 1. Retain the current Inclusionary Housing Retain the current Inclusionary Housing Ordinance requirement that 20% of new Ordinance requirement that 20% of new residential lots or units be deed restricted and residential lots or units be deed restricted and that of the 20%, (6% very low income, 6% that of the 20%, (6% very low income, 6% low income and 8% moderate income).low income and 8% moderate income).

2. 2. Require a mandatory Require a mandatory 10%10% contribution for contribution for Workforce Level (up to 180% of median Workforce Level (up to 180% of median income) housing for projects of 10 or more income) housing for projects of 10 or more units/lots to be developed under a separate units/lots to be developed under a separate “Workforce Housing Ordinance” which would “Workforce Housing Ordinance” which would allow the restrictions to include equity-sharing allow the restrictions to include equity-sharing provisions. provisions.

Jobs/Housing Requirements

3. 3. Retain the existing policy contained in the Retain the existing policy contained in the Housing Element that encourages Housing Element that encourages employers to voluntarily assist in the employers to voluntarily assist in the production of employee housing (Policy production of employee housing (Policy H-5.3).H-5.3).

4. 4. OPTION: Although not recommended at OPTION: Although not recommended at this time, the Board may also wish to this time, the Board may also wish to consider adding a program to the Housing consider adding a program to the Housing Element in the future requiring the County Element in the future requiring the County to develop a new employee housing to develop a new employee housing program that includes a contribution from program that includes a contribution from new job creating development to a new job creating development to a County-wide housing trust.County-wide housing trust.

Affordable Housing Overlay District

5. 5. Remove the Affordable Housing Overlay Remove the Affordable Housing Overlay program that is currently contained in the program that is currently contained in the Housing Element (Policy H-3.8) since the same Housing Element (Policy H-3.8) since the same objectives can be achieved by implementing objectives can be achieved by implementing the Affordable Housing Developer Incentive the Affordable Housing Developer Incentive Program, which will incorporate the current Program, which will incorporate the current State Density Bonus provisions, without State Density Bonus provisions, without creating a new governmental program. creating a new governmental program.

GPU-3 Voluntary program for projects with a minimum of 10% very low, Voluntary program for projects with a minimum of 10% very low,

20% low, 40% moderate, 10% WF1, 20% WF2.20% low, 40% moderate, 10% WF1, 20% WF2.

Applies to Pajaro, Las Lomas, Aromas, Prunedale, Moss Landing, Applies to Pajaro, Las Lomas, Aromas, Prunedale, Moss Landing, Castroville, RSJ, Boronada, Fort Ord, River Road, Mouth of Castroville, RSJ, Boronada, Fort Ord, River Road, Mouth of Carmel Valley, Hwy 68 Corridor, Chualar, San Jucas, San Ardo, Carmel Valley, Hwy 68 Corridor, Chualar, San Jucas, San Ardo, Pine Canyon, Bradley, Lockwood, and Pleyto Pine Canyon, Bradley, Lockwood, and Pleyto in any zoning in any zoning districtdistrict..

Applies to properties/projects meeting Applies to properties/projects meeting specific criteriaspecific criteria: including : including not in environmentally sensitive areas and has public services. not in environmentally sensitive areas and has public services.

Densities between 10 and 30 du/ac with an average of 15 du/ac, Densities between 10 and 30 du/ac with an average of 15 du/ac,

IncentivesIncentives provided including density bonus, permit assisting, provided including density bonus, permit assisting, fee waiver, and modified development standard. fee waiver, and modified development standard.

Refinement Group Voluntary program for projects with a minimum of 10% very low, Voluntary program for projects with a minimum of 10% very low,

15% low, 15% moderate, 20% WF1, 20% WF2.15% low, 15% moderate, 20% WF1, 20% WF2.

Applies to the Greater Monterey peninsula and Carmel Valley Applies to the Greater Monterey peninsula and Carmel Valley Planning Areas, Big Sur, the community areas and rural centers Planning Areas, Big Sur, the community areas and rural centers in in any zoning districtany zoning district..

Applies to development for which there are no significant Applies to development for which there are no significant unavoidable impacts or for which unavoidable impacts or for which overriding considerationsoverriding considerations cannot be made. cannot be made.

Densities between 6 and 30 du/ac with an average of 10 du/ac. Densities between 6 and 30 du/ac with an average of 10 du/ac.

IncentivesIncentives, including streamlined permitting processing and , including streamlined permitting processing and priority allocation for water and sewer, and modified development priority allocation for water and sewer, and modified development standards.standards.

Projects may proceed in advance of the adoption of community Projects may proceed in advance of the adoption of community plans and/or infrastructure/financing plans plans and/or infrastructure/financing plans

Developer Incentive Program Include the State Density Bonus provision – if a project meets the Include the State Density Bonus provision – if a project meets the

threshold for affordability up to 35% density bonus. threshold for affordability up to 35% density bonus.

The program would be applied to any residentially zoned property The program would be applied to any residentially zoned property anywhere in the county with the bonus anywhere in the county with the bonus applied to the base zoningapplied to the base zoning density. density.

IncentivesIncentives including relaxation of development codes and including relaxation of development codes and allowing a project to proceed in advance of the adoption of allowing a project to proceed in advance of the adoption of community plans or infrastructure plans. community plans or infrastructure plans.

The bonus and/or incentives may be denied if there is a specific The bonus and/or incentives may be denied if there is a specific adverse environmental impact for which there is adverse environmental impact for which there is no feasible no feasible method to mitigatemethod to mitigate or avoid the impact. or avoid the impact.

The County can increase the density bonus over the 35% The County can increase the density bonus over the 35% maximum as the amount and levels of affordability over the State maximum as the amount and levels of affordability over the State thresholds. thresholds.

What will the overlay strategy contained in each of the draft

plans accomplish?

A.A. GPU-3:GPU-3: Encourage Encourage high density (average 15 du/ac) affordable projects on sites that meet high density (average 15 du/ac) affordable projects on sites that meet criteria (environmentally sensitivity and services). criteria (environmentally sensitivity and services).

B.B. Refinement Plan:Refinement Plan: Encourage medium density (average 10 du/ac) affordable projects on Encourage medium density (average 10 du/ac) affordable projects on land with land with any land use designationany land use designation unless overriding consideration unless overriding consideration cannot be made. cannot be made.

C.C. Developer Incentive Program incorporating State Density Bonus Developer Incentive Program incorporating State Density Bonus Requirements:Requirements: Encourage affordable hosing on Encourage affordable hosing on residentially designated sitesresidentially designated sites unless unless significant environmental impacts cannot be feasibly mitigated.significant environmental impacts cannot be feasibly mitigated.

Housing Unit Allocation System

6. 6. Do not include a housing allocation Do not include a housing allocation system in the Housing Element as it system in the Housing Element as it may affect certification of the Element may affect certification of the Element by the State and could limit overall by the State and could limit overall affordable housing production.affordable housing production.

TARGET LOCATIONS FOR HOUSING PRODUCTION

7. 7. Once the GPU is adopted, amend the Once the GPU is adopted, amend the Housing Element to be consistent with the Housing Element to be consistent with the growth pattern established in the Land Use growth pattern established in the Land Use Element. Element.

REQUIRING INFRASTRUCTURE TO BE IN PLACE CONCURRENT WITH

HOUSING PRODUCTION

8. 8. Retain the existing policy language in Retain the existing policy language in the adopted Housing Element to require the adopted Housing Element to require that public services and infrastructure that public services and infrastructure be provided concurrently with housing be provided concurrently with housing production.production.

INFRASTRUCTURE OPTIONS

1. 1. No Relaxation of Infrastructure No Relaxation of Infrastructure RequirementsRequirements

2. 2. Case by Case waiver as long as not Case by Case waiver as long as not hazardhazard

3. 3. Waive Infrastructure Requirements for Waive Infrastructure Requirements for Affordable UnitsAffordable Units

PROVISIONS FOR SECONDARY UNITS

9. 9. Retain the existing policy language in the Retain the existing policy language in the adopted Housing Element which states that adopted Housing Element which states that the County shall allow secondary units in the County shall allow secondary units in conformance with State law and consistent conformance with State law and consistent with Community and Specific Plans to with Community and Specific Plans to provide additional housing opportunities. provide additional housing opportunities.

MONTERY COUNTY2005 GENERAL PLAN UPDATE

STUDY SESSION HOUSING, ECONOMIC

DEVELOPMENTJune 16, 2005

2005 Affordable Housing Income Limits

Income Income LevelLevel

2 person 2 person householdhousehold

3 person 3 person householdhousehold

4 person 4 person householdhousehold

5 person 5 person householdhousehold

Very low Very low (50% )(50% )

$24,300$24,300 $27,350$27,350 $30,400$30,400 $32,850$32,850

Low (80%)Low (80%) $38,900$38,900 $43,800$43,800 $48,650$48,650 $52,550$52,550

Moderate Moderate (120%)(120%)

$58,350$58,350 $65,650$65,650 $72,950$72,950 $77,600$77,600

Workforce I Workforce I (140%)(140%)

$68,100$68,100 $76,600$76,600 $85,100$85,100 $91,950$91,950

Workforce II Workforce II (180%)(180%)

$87,550$87,550 $98,500$98,500 $109,450$109,450 $118,200$118,200

2005 Affordable Housing Sales Prices

Income LevelIncome Level 2 bedroom2 bedroom 3 bedroom3 bedroom 4 bedroom4 bedroom

Very lowVery low $93,754$93,754 $104,211$104,211 $112,609$112,609

LowLow $131,292$131,292 $145,861$145,861 $157,515$157,515

ModerateModerate $240,759$240,759 $267,554$267,554 $288,895$288,895

Workforce IWorkforce I $306,349$306,349 $340,341$340,341 $367,735$367,735

Workforce IIWorkforce II $393,933$393,933 $437,725$437,725 $472,721$472,721

2005 Affordable Housing Rents

Income LevelIncome Level 2 bedroom2 bedroom 3 bedroom3 bedroom 4 bedroom4 bedroom

Very lowVery low $684$684 $760$760 $821$821

LowLow $821$821 $912$912 $985$985

ModerateModerate $1,095$1,095 $1,216$1,216 $1,314$1,314

Workforce IWorkforce I $1,915$1,915 $2,127$2,127 $2,299$2,299

Workforce IIWorkforce II $2,463$2,463 $2,736$2,736 $2,955$2,955

DENSITY BONUS PROVISIONS

Minimum Project QualificationsMinimum Project Qualifications::

• 10% lower income10% lower income

• 5% very low income5% very low income

• Qualified senior housing Qualified senior housing

• 10% in a condo or PUD for moderate income10% in a condo or PUD for moderate income

The new State Density Bonus provisions (SB 1818) The new State Density Bonus provisions (SB 1818) that went into effect on January 1, 2005 require that that went into effect on January 1, 2005 require that local land use agencies provide density bonuses and local land use agencies provide density bonuses and

other incentives to qualified projects.other incentives to qualified projects.

Density Bonus: Increases in densities over the base land use Increases in densities over the base land use

regulations (without a GPA or Rezoning) must be regulations (without a GPA or Rezoning) must be provided to qualified projects if requested.provided to qualified projects if requested.

The increases must range from a minimum of 20% to The increases must range from a minimum of 20% to

35%, increasing as the levels of affordability increase35%, increasing as the levels of affordability increase

DENSITY BONUS PROVISIONS

Incentives: As the affordability levels deepen more As the affordability levels deepen more

incentives must be provided. incentives must be provided. The incentives may include reductions in The incentives may include reductions in

development requirements or other concessions development requirements or other concessions that would reduce costs to the developer, that would reduce costs to the developer, including waivers of fees and infrastructure including waivers of fees and infrastructure requirements.requirements.

A requested concession can only be denied if it A requested concession can only be denied if it has a specific adverse impact that cannot be has a specific adverse impact that cannot be feasibly mitigated.feasibly mitigated.

DENSITY BONUS PROVISIONS

STATE - SECOND UNIT PROVISIONS

New State provisions related to allowing New State provisions related to allowing second units (SB 1866) went into effect on second units (SB 1866) went into effect on January 1, 2003.January 1, 2003.

  Local land use agencies must either adopt Local land use agencies must either adopt an ordinance or apply minimum State an ordinance or apply minimum State requirements to allow second units as a requirements to allow second units as a ministerial act.ministerial act.

STATE - SECOND UNIT PROVISIONS

A local ordinance may specify A local ordinance may specify criteria/requirements such as:criteria/requirements such as:

• Designate areas where 2Designate areas where 2ndnd units are permitted units are permitted

• Designated minimum requirements such as Designated minimum requirements such as adequacy of water and wastewater systemsadequacy of water and wastewater systems

• Address traffic impacts Address traffic impacts

• Impose site development standards including Impose site development standards including conformance with base densityconformance with base density