65B - HOUSING OPPTY REPORT - Laserfiche WebLink

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EXHIBIT 4 Impact: City staff indicate that initial results of Measure JJJ show a significant decline of proposed housing units through General Plan amendments and zone changes, which may be due to a confluence of factors. However, staff have also seen positive results emerging from a separate program that originated from Measure JJJ, called the Transit Oriented Communities Affordable Housing Incentive Program (TOC Program). The TOC Program promotes affordable housing development located in a one-half mile radius around a major transit stop by providing incentives such as additional density and reduced parking. There are varying levels of affordability required targeting extremely -low income households, very low-income households, and lower income households. Additional incentives could be granted if certain labor standards are met, but this is discretionary. Los Angeles also has an affordable housing linkage fee program which became operational in June 2018. For -sale and rental housing development are exempt from the fee if they include affordable units where at least 40% are for moderate -income households; 20% are for low-income households; 11% are for very low-income households; or 8% are for extremely low-income households. The fee per square foot varies by size of the development project, but ranges between $1 in a low market area and $18 in a high market area .7 Since the linkage fee has just gone into effect, there is no information available on its impacts. However, city staff estimate that the fee could generate about $110 million per year that would go towards affordable housing. City of San Jose Inclusionary Housing Ordinance Background: San Jose's Inclusionary Housing Ordinance was adopted in January 2010. However, its implementation was stalled because it was challenged by the California Building Industry Association claiming that it was an unconstitutional exaction. In 2015, the city's ordinance was upheld by the California Supreme Court which instead characterized residential inclusionary zoning ordinances as "land use restrictions", and therefore not subject to special scrutiny triggered by exactions.' This ruling allowed San Jose's Inclusionary Housing Ordinance to be reactivated after a grace period, but only for for -sale units (not for rental units) due to the Palmer court decision. San Jose's Inclusionary Housing Ordinance kept the requirements related to rental units in law but made its operation contingent upon the Palmer decision being overturned, or the state legislature authorizing control of rents of inclusionary units. With the enactment of AB 1505, San Jose has only recently been able to fully implement its Inclusionary Housing Ordinance for both for -sale and rental units even though it has been on the books since 2010. Base Requirement: The ordinance requires that all residential development projects that are 20 units or more include 15% of the housing on-site at a cost that is affordable to specified income 7 City of Los Angeles, Affordable Housing Linkage Fee, Ordinance Background and Frequently Asked Questions, February 2017. s California Building Industry Association v. City of San Jose, March 10, 2016 https://harvardlawreview.ore/2016/03/California-buildine-industry-assn-v-city-of-san-ig e/, accessed July 6, 2018. 5 65B-17