75B - PH - ZONING ORDN AMENDMENT

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Zoning Ordinance Amendment No. 2011-01 Septerber 26, 2011 Page 6 During the Planning Commission's May 9, 2011 meeting Chairman Alderete appointed an Ad Hoc Committee consisting of himself and Commissioners Acosta and Turner to further review the ordinance. The Planning Commission continued the Housing Opportunity Ordinance on August 22, 2011 to the Commission meeting on September 12, 2011 and then to the meeting of September 26, 2011 at the request of staff. Plannina Commission Ad Hoc Committee The Planning Commission Ad Hoc Committee held two meetings (June 7 and 30, 2011) to discuss in detail the proposed ordinance. The primary areas of discussion topics centered on the methodology used to calculate any potential in-lieu fee, the contents of the Administrative Procedures manual and the specifics of the allowance for off-site rehabilitation as a means to satisfy the inclusionary housing requirement. Kathe Head, the City's consultant from Keyser Marston Associates, provided information on her experience in developing and administering inclusionary housing ordinances throughout the State. In response to the Commissioners' questions and concerns regarding a "fixed fee" approach versus a "market conditions" approach, or some combination thereof, Ms. Head clarified that the approach contained in the proposed ordinance would not establish a fixed fee, but would instead be responsive to market conditions at the time of the application. The Committee also discussed the provision contained in the Ordinance that allows an applicant to provide for the required affordable units off-site through the substantial rehabilitation of existing units, such as an existing apartment building. Clarification has been added to the ordinance that would ensure that the number of units to be rehabilitated off-site matches the affordability gap associated with the provision of on-site units. Policy Considerations for the Fixed Fee vs. the Market Conditions Approach The primary goal of the Housing Opportunity Ordinance is to achieve production of units within development projects. This ensures that the City is able to show progress towards its Regional Housing Needs Assessment (RHNA) targets, as well as ensuring that projects have mixed-income units, rather than clumping affordable units all together in separate projects. However, where it can be clearly demonstrated that production of such units within a project is not feasible, the ordinance includes a provision whereby a developer may request that the City Council allow them to pay a fee in lieu of providing the required affordable units. Upon consideration of the applicant's request, the Council may either approve or deny the ability to pay the in-lieu fee. The fee itself would be determined by a set methodology. It is important to note, however, that accepting in-lieu fees is a last resort. The overarching goal is to produce affordable housing units in a mixed income setting, rather than stand-alone affordable projects. 75B-8