HomeMy WebLinkAbout11/19/1996, 6 - AMENDMENTS TO THE CONDOMINIUM CONVERSION REGULATIONS (FILE NO. TA 122-96). council "�°`;;_ lq_Q�
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CITY OF SAN LUIS OBISPO
FROM: Arnold Jo O
PREPARED BY: Jeff Hoo
SUBJECT: Amendments to the Condominium Conversion Regulations (File No. TA 122-96).
CAO RECOMMENDATION: Introduce an ordinance amending Chapter 17.82 of the
Municipal Code to require affordable housing in connection with condominium conversions, and
to allow the Community Development Director to waive the solar water heating requirement for
condominiums when equivalent energy savings are demonstrated.
DISCUSSION
Planning Commission Action
At its October 9, 1996 meeting, the Planning Commission unanimously recommended that the
City Council amend the Municipal Code to require affordable housing as part of condominium
conversions (6-0, Commr. Veesart absent), and to allow exceptions to the solar water heating
requirement when equivalent energy savings could be demonstrated.
In September 1994 the City Council adopted an updated Housing Element. The Element includes
a number of programs intended to expand housing opportunities for very-low, low and moderate
income persons. Of some 50 housing programs in the Element, many require specific follow-up
action or ordinance changes to implement. The proposed ordinance amendments are, in essence,
"housekeeping" items which implement the previous Planning Commission and City Council
direction contained in the Housing Element.
Description of Proposed Changes
A. Affordable Housing Requirement- Condominium Conversions
Housing Element Program 1.22.16 calls for the City to "revise its condominium conversion
regulations to discourage or prevent the conversion of affordable rental units to condominiums unless
permanent affordability guarantees, such as deed restrictions, are incorporated into the conversion."
The proposed amendments implement this program.
"Condominium conversion" refers to the conversion of rental apartments to ownership units.
Common in the 1980s, condominium conversions often resulted in the loss of affordable rental
housing and the displacement of low-and moderate-income renters. Rent restrictions imposed by
some cities was believed to be a strong incentive to convert; and the demand for ownership
housing and relatively low cost of conversion made this form of housing attractive to developers.
Staff Report
Page 2
A depressed housing market in California slowed conversions and apartment production in recent
years. Given improved economic conditions, both statewide and locally, the development of both
rental housing and condominiums is expected to rebound in the latter half of the 1990s. This
amendment would ensure that affordable apartments converted to condominiums would remain
affordable to low- or moderate-income persons. At the developer's option, affordability would
be maintained by:
1. Offering the converted units to tenants"at risk" of being displaced by the conversion.
Tenants would receive a 90-day "first right of refusal" to purchase their unit at prices
allowed under the City's Affordable Housing Standards. If tenants did not exercise the
option, the unit could be sold at market rate; or
2. Including rental affordability guarantees. The developer would guarantee through deed
restrictions that low- and moderate-income tenants could continue renting their unit after
conversion, for a specified period to be negotiated by the developer and the City prior to
occupancy, but not less than three (3) years; or
3. Providing off-site affordable housing. The developer could provide an equivalent
number of off-site, affordable dwellings for tenants at risk of displacement by: a)
remodeling or converting vacant, substandard or non-conforming buildings or uses within
the City; or by b) building new rental or ownership units within the City. New or
remodeled units shall be comparable in size and amenities to the converted units; or
4. Paying an in-lieu housing fee. Developer would pay an in-lieu housing fee, to the
approval of the City Council.
Exceptions to Affordable Housing Requirement
Municipal Code Section 17.82.160 would be added to allow the City Council to grant exceptions
to the affordable housing requirement if the Council finds that "the project will not materially
reduce the City's affordable housing stock and will not displace low- or moderate-income
households."
B. Energy Conservation Requirement
Municipal Code Section 17.82.140(H) requires new condominiums to include solar water heating.
The requirement grew out of the Energy Conservation Element, adopted in 1981, which promoted
energy efficient design and construction methods. Since then, Title 24 energy standards were
adopted statewide, setting stringent energy conservation standards for all new development. In
recent years, condominium developers have claimed that technological advances in appliances,
lighting, and building design and materials have surpassed the energy savings previously available.
through solar water heating, and have requested flexibility in the solar water heating requirement.
This amendment would provide that flexibility, and would implement Housing Element Program
1.22.12 which says that the City will periodically review its planning and building regulations to
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Staff Report
'Page 3 - -
remove regulations which are no longer needed and which could assist in the production of
affordable housing.
RECOMMENDATION
Introduce an ordinance.amending Chapter 17.82 of the Municipal Code, as,shown in the attached
draft ordinance.
Attachments:
-Draft Ordinance
Excerpts, Housing Element
-Affordable Housing Standards
-Draft Planning Commission minutes
6.3
ORDINANCE NO. (1996 SERIES)
AN ORDINANCE OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
AMENDING THE CONDOMINIUM DEVELOPMENT AND CONVERSION
REGULATIONS TO REQUIRE AFFORDABLE HOUSING AND TO ALLOW
EXCEPTIONS TO THE SOLAR WATER HEATING REQUIREMENT.
WHEREAS,Housing Element Program 1.22.16 calls for the City to revise its condominium
regulations to discourage or prevent the conversion of affordable rental units to condominium units
unless permanent affordable guarantees, such as deed restrictions, are incorporated into the
conversion; and
WHEREAS,Housing Element Program 1.22.12 calls for the periodic review of planning and
building regulations for possible changes to assist in the production of affordable housing while not
conflicting with other General Plan policies, or to remove regulations that are no longer needed; and
WHEREAS, the Planning Commission held a hearing on October 9, 1996 to discuss
amendments to the City's Condominium Development and Conversion Regulations and recommended
that the City Council amend Chapter 17.20 of the San Luis Obispo Municipal Code to implement
these Housing Element programs;
NOW THEREFORE, BE IT ORDAINED by the City Council of the City of San Luis
Obispo as follows:
SECTION 1. The City Council has determined that the proposed amendments are not a
project as defined by Section 15378 of the California Environmental Quality Act because they involve
the enactment or amendment of zoning regulations and will not result in a physical change in the
environment, and consequently, are exempt from further environmental review.
SECTION 2. Chapter 17.82 of the San Luis Obispo Municipal Code is hereby amended as
shown in Exhibit A.
SECTION 3. A synopsis of this ordinance, approved by the City Attorney, together with the
names of the Council Member voting for and against, shall be published at least five days prior to its
final passage, in the Telegram-Tribune, a newspaper published and circulated in this City. This
ordinance shall go into effect at the expiration of thirty(30) days after its final passage.
INTRODUCED AND PASSED TO PRINT by the Council of the City of San Luis Obispo
at a meeting held on the day of on motion of
seconded by and on
the following roll call vote:
6-y
Ordinanee No.. 0996':Series)
Page 2
.AYES:
NOES:
ABSENT.*
ATTEST:
City Clerk Mayor Allen& Settle -
APPROVED AS TO FORM
__ orne
to-S
B>t
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Chapter 17.82
'1m:~CONDOMINIUM DEVELOPMENT AND CONVERSION
Sections:
17.82.010 Purpose and intent.
17.82.020 Definitions.
17.82.030 Applicability of other laws.
17.82.040 Provisions to govern condominium conversion projects.
17.82.050 Application requirements.
17.82.060 Acceptance of report.
17.82.070 Copy of reports to buyers.
17.82.080 Tenant provisions.
17.82.090 Hearing—Notification.
17.82.100 Application—Required findings.
17.82.110 Property improvement standards for condominium conversions.
17.82.120 Conversion limit procedure.
17.82.130 New project regulations—Standards togovern.
17.82.140 Property improvement standards for new condominium projects.
17.82.150
17.82.010 Purpose and intent
Condominiums, community apartments and stock cooperatives provide for ownership of
separate dwellings, or equity coupled with a right of exclusive occupancy, as well as common areas
within multiple-family housing normally managed and maintained by an owner's association. This
mix of individual and common ownership and the potential problems of converting existing
apartments make special regulations necessary.
The city has determined that condominiums differ from apartments in some respects and, for
the benefit of public health, safety and welfare, such projects should be treated differently from
apartments.
These regulations are intended to:
A. Establish requirements and procedures for the conversion of existing rental housing to
residential condominiums and other forms of occupant ownership;
B. Provide for compliance with the housing element of the general plan;
C. Assure that purchasers of converted apartments are aware of the condition of the structure
which is offered for purchase;
D. Provide design and property improvement standards for condominium projects, both new
and converted. (Ord. 984 ss 2 (part), 1983: prior code ss 9850)
8
A,..a the joss t?f affordable housin .stock as a cesuA.mItf condnrnmiuFn bgnyrsians<
17.82.020 Definitions
The following words and phrases shall have the indicated meanings:
to" O
Ordinance No.
Page 2
A. "Applicant" means the owner of real property proposed to be subdivided, or his
authorized representative.
B ;`.Affordable haus►ng"is nmeans housing which rents or sells at prices which conform to the
r ;w
(a.:54o`AffoidaE�le oustng Standazrls�'issued by the Commurutyr.DeyelppmentDFrectar,,as.prot*t e
by,„�I.U3wViG.I7 9€1 U9E}.
13C. "Community apartment"means an apartment development in which an undivided interest
in the land is coupled with the right of exclusive occupancy of an apartment located thereon. For the
purposes of this chapter, community apartments will be subject to the same regulations as
condominium projects.
Q. "Condominium conversion" means the conversion of property from occupancy under
its existing tenancies or estates to occupancy under condominium, community apartment or stock
cooperative interests.
K. "Condominium project" means the entire parcel of real property, including all structures
thereon, subdivided or to be subdivided for the purpose of constructing or converting existing
structures to condominium units.
£E. "Design." Design of a project shall include:
1. Driveway location, grades and widths;
2. Drainage and utilities, including size, alignments and grades thereof,
3. Location and size of all required easements and rights of way;
4. Fire protection devices;
5. Lot'size and configuration;
6. Traffic access;
7. Parking;
8. Land to be dedicated for park or recreational purposes;
9. Landscaping;
10. Structures; and
11. Other specific requirements in the plan and configuration of the entire project as
may be necessary or desirable to insure conformity to or implementation of the
general plan or any adopted specific plan.
1=G. "Stock cooperative"means a corporation which is formed or availed of primarily for the
purpose of holding title to, either in fee simple or for a term of years, improved real property, if all
or substantially all of the shareholders of such corporation receive a right of exclusive occupancy in
a portion of the real property, title to which is held by the corporation, which right of occupancy is
transferable only concurrently with the transfer of the share or shares of stock in the corporation held
by the person having such right of occupancy. For the purposes of this chapter, stock cooperatives
will be subject to the same regulations as condominium projects. (Ord. 984 ss 2 (part), 1983: prior
code ss 9851)
17.82.030 Applicability of other laws.
All condominium projects shall be subject to all applicable provisions of the Subdivision Map Act and
Titles 15,16 and 17 of this code, and all other applicable state and local laws and ordinances. (Ord.
984 ss 2 (part), 1983: prior code ss 9852)
4o' 1
Ordinance No.
Page 3
17.82.040 Provisions to govern condominium conversion projects.
The procedures and standards contained in this chapter shall govern condominium projects.
(Ord. 984 ss 2 (part), 1983: prior code ss 9853)
17.82.050 Application requirements.
The following shall be provided at the time of application for condominium conversion:
A. Property condition report. The application shall be accompanied by a property condition
report including at least the following:
1. A report detailing the condition of all elements of the property including
foundations, ventilation, utilities, walls, roofs, windows, mechanical equipment,
appliances which will be sold with the units, common facilities and parking areas. The
report shall state, to the best knowledge of the applicant, and for each element: the
date of construction, the condition, the expected useful life, the cost of replacement,
and any variations from the zoning regulations in effect when the last building permit
was issued for the subject structure(s). The report shall identify all defective or unsafe
elements or those which may impair use and enjoyment of the property, and explain
the proposed corrective measures to be used. The report shall be prepared by or
under the supervision of a registered civil or structural engineer, licensed general
contractor or architect;
2. A report from a licensed pest-control operator describing in detail the presence and
effects of any wood destroying organisms;
3. A report of any known soil or geological problems. Reference shall be made to
any previous soil reports for the site.
B. Site plan. The application shall be accompanied by a site plan which shall include at least
the following:
1. The location, number of stories, number of all dwellings, and proposed uses for
each structure to remain and for each proposed new structure;
2. The location, use and type of surfacing for all open storage areas;
3. The location and type of surfacing for all driveways, pedestrian ways, vehicle
parking areas, and curb cuts;
4. The location, height and type of materials for walls or fences;
5. The location of all landscaped areas,the type of landscaping, method of irrigation,
and a statement specifying private or common maintenance;
6. The location and description of all recreational facilities;
7. The location, size and number of parking spaces to be used in conjunction with
each unit;
8. The location, type, and size of all drainage pipes and structures;
9. Existing contours, building pad elevations and percent slope for all driveways and
parking areas;
C. Evidence of delivery of notice of intent to convert. The application shall be accompanied
by signed copies from each tenant of the notice of intent to convert as specified in Section
17.82.080A The applicant shall submit evidence that a certified letter of notification was sent
to each tenant for whom a signed copy of the notice is not submitted.
(p'O
Ordinance No.
Page 4
D. Other information. The application shall be accompanied by any other information which
in the opinion of the director of community development will assist in determining whether
the proposed project will be consistent with the purposes of these regulations. (Ord. 984 ss
2 (part), 1983: prior code ss 9853.1)
17.82.060 Acceptance of Report
The community development director shall establish the final form of the reports required by
Section 17.82.050. Approved reports shall remain on file with the community development
department for review by interested persons. (Ord. 984 ss 2 (part), 1983: prior code ss 9853.2)
17.82.070 Copy of reports to buyers.
Each prospective purchaser shall be provided with a copy of all reports in their final form,
except the signed notices of intent to convert, prior to entering escrow. Copies of the report shall
be available at the sales office and the project site. (Ord. 984 ss 2 (part), 1983: prior code ss 9853.3)
17.82.080 Tenant provisions
A. Notice of intent to convert. Applicant shall give each tenant a written notice of intent to
convert at least one hundred eighty days before termination of tenancy due to conversion. The notice
shall contain at least the following:
I. Name and address of current owner;
2. Name and address of proposed subdivider;
3. Approximate date on which the unit is to be vacated by non-purchasing tenants;
4. Tenant's right to purchase;
5. Statement of no rent ti
increase;e
ase• an.:.;:,::,>::;;:;•>:>:::>:;�:::«; ::; :<::::><:::<<_;>::::>::::::<<;:::<:;:;
> dstatementof:.:.:propgsedsales:prtcesandte�ns.
B. Tenant's right to purchase. Pursuant to Government Code Section 66427.1(d), applicant
shall give any present tenant a nontransferable right of first refusal to purchase the unit occupied-at
right
at least ninety days from the date of issuance of the subdivision publiiceportror commencement of
sales, whichever date is later.
C. Vacation of units. Each non-purchasing tenant not in default under the provisions of the
rental agreement or lease under which he occupies his unit, shall have the right to remain not less than
one hundred eighty days from the date of receipt of notification of intent to convert.
D. No increase in rents. A tenants rent shall not be increased during the one hundred eighty
day period provided in subsection C of this section.
E. Notice to new tenants. After submittal of the tentative map, prospective tenants shall be
given a written notice of intent to convert prior to leasing or renting any unit. (Ord. 984 ss 2 (part).
1983: prior code ss 9853.4.)
17.82.090 Hearing—Notification.
Prior to acting on applications, the planning commission and council shall each hold a public hearing,
notice of which shall be given tenants of the proposed conversion and posted on the property at least
ten days beforehand. (Ord. 984 ss 2 (part), 1983: prior code ss 9853.5)
6-9
Ordinance No.
Page 5
17.82.1 00 Application—Required findings.
An application for condominium conversion shall not be approved until these findings are made:
A. All provisions of these regulations have been or will be met;
B. The proposed conversion is consistent with the general plan;
C. That there exist facts adequate to support the findings required under Sections 66473.5
and 66474 of the Government Code;
D.
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:`oF x�2�'an.equtyaleAt number ol`new unrts comparable rn affordability acrd amernties,#a those being
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17.82.110 Property improvement standards for condominium conversions.
A. Building and zoning regulations. Conversion projects shall substantially comply with the
city's building and housing codes and zoning regulations in effect on the date the conversion project
is approved_
B. Fire safety.
1. Smoke detectors. Each living unit shall be provided with approved smoke
detectors mounted on the ceiling or wall at a point centrally located in the area giving
access to rooms used for sleeping purposes.
C. Fire protection systems. All fire hydrants, fire alarm systems, portable fire extinguishers
and other fire protection appliances shall be maintained in operable condition at all times and shall
comply with current city standards.
D. Utility metering. The consumption of gas, electricity and water within each unit shall be
separately metered and there shall be circuit breakers and shutoff valves for each unit.
E. Storage. Each dwelling unit shall have provision for at least two hundred cubic feet of
enclosed, weatherproof; and lockable private storage space, exclusive of cabinets and closets within
the unit. This space shall be for the sole use of the unit owner. The minimum opening shall be two
and one half feet by four feet and the minimum height shall be four feet.
F. Laundry facilities. A laundry area shall be provided in each unit, or in common laundry
space. Common facilities shall consist of at least one washer and dryer for each ten units or fraction
thereof.
G. Parking. The number of parking spaces shall be as provided in the zoning regulations.
Spaces for the exclusive use of occupants of each unit shall be so marked. Visitor parking and special
stopping zones, if any, shall also be marked.
H. Refurbishing and restoration. All structures, common areas, sidewalks, driveways,
landscaped areas and facilities, if defective, shall be refurbished and restored to a safe and usable
condition. All deficiencies shall be corrected prior to recordation of a final map.
I. Minimum project size. Condominium conversion shall not be allowed for projects
consisting of less than ten residential units.
4.10
Ordinance No.
Page 6
J. Private open space. There shall be provided with each unit a minimum of two hundred fifty
square feet of qualifying private open space for projects in the R-1 or R-2 zones, and a minimum
of one hundred square feet for projects in the R-3 or R-4 zones. To qualify, open space must be
private and directly accessible from the unit it serves, and must have a minimum dimension in every
direction of ten feet for open space provided at ground level or six feet for open space provided on
a balcony or elevated deck and must be located outside the street yard required by the zoning
regulations.
K. Common open space. There shall be provided in each project a minimum of one hundred
square feet of qualifying common open space per unit for projects in the R-3 or R-4 zones. To
qualify, open space shall have a minimum dimension in every dimension of ten feet for open space
provided at ground level or six feet for open space provided on a balcony or elevated deck, and must
be located outside the street yard required by zoning regulations. Common open space need not be
located with each unit. There is no minimum common open space requirement for projects in the R-1
and R-2 zones.
L. Total open space. There shall be provided in each project a minimum of one thousand
square feet per unit of qualifying private and common open space for projects in the R-1 zone, seven
hundred fifty square feet per unit for projects in the R-2 zone, and four hundred square feet per unit
for projects in the R-3 or R4 zones.
M. Common recreation facilities. There shall be provided in each project in the R-3 or R4
zones a minimum of twenty square feet per unit of common indoor recreation facilities, or forty
square feet per unit of improved outdoor recreation facilities. Common recreation facilities shall be
available for, and limited to, the use of the project's tenants and their guests. Common recreation
facilities must be located outside the street yard required by zoning regulations.
N. Open space and recreation facilities in nonresidential zones. Requirements for open space
and recreational facilities for projects in nonresidential zones shall be set by the council at the time
the project is reviewed.
O. Installation of clotheslines. Tenants shall not be prohibited from installing clotheslines in
private open areas which are substantially screened from common view. (Ord. 984 ss 2(part), 1983:
prior code ss 9853.7)
17.82.120 Conversion limit procedure.
A. Annual limit. The city shall not approve conversion projects in any one calendar year
resulting in more units being converted than one-half the number of multi-family rental dwellings
added to the city's housing stock during the preceding year. The number of multi-family rental units
added in one year shall be determined as follows: From January 1 st through December 31 st, the total
number of multi-family rental units given a final building inspection and occupancy permit minus the
number of such units demolished, removed from the city, or converted to nonresidential use.
B. Filing period. Applications for conversion may be filed during the month of January and
February only. No action shall be taken on applications during this period.
C. Project ranking.
1. If applications on file at the end of the filing period would, when approved,
convert more dwelling units than allowed under subsection A of this section, the
planning commission shall rank the applications according to the following criteria:
Ordinance No.
Page 7
a. The fractions of tenants not objecting to conversion;
b. Time given tenants to relocate, in addition to the minimum requirement;
c. Credit of tenants' rent or deposits toward purchase price;
d. Provision of individual open space with each dwelling;
e. Provision of additional storage space beyond minimum requirement;
f. Provision of additional parking beyond minimum requirement;
g. Provision of additional open space or recreation facilities beyond minimum
requirement;
h. Provision of units which low-income and moderate-income families can afford;
i. Provision of solar water heating r= galenf>ener ""';!san'`5.
2. The planning commission's evaluation shall be a recommendation to the council,
which may act on conversion projects based on its own findings, within the numerical limits
established under subsection A of this section.
D. Time limits for actions. The results of the planning commission's evaluation shall be
transmitted to the council by April 1 st. The council shall approve, approve subject to conditions, or
deny each conversion application by May I st. If the applications on file at the end of the filing period
would not exceed the year's limit, they shall be forwarded directly to the council, which shall act on
the applications by April 1 st.
E. Maps. Maps are required by the California Subdivision Map Act need not be prepared
until an application for conversion has been approved. Maps shall be processed as provided in the
city's subdivision regulations set out in Title 16 of this code. The tentative map application shall be
accompanied by the declaration of covenants, conditions and restrictions, articles of incorporation,
bylaws and contracts for the maintenance, management or operation of any part of the condominium
conversion project, which would be applied on behalf of any and all owners of the condominium units
within the project. In addition to the requirements of Civil Code Section 1355 and any requirements
which might be imposed by the city consistent with these regulations, the organizational documents
shall include provisions concerning the conveyance of units; the assignment of parking; an agreement
for common area maintenance, including facilities and landscaping, an estimate of initial fees
anticipated for such maintenance, an indication of responsibilities for maintenance of all utility lines
and services for each unit. The covenants, conditions and restrictions document shall include a
reference to attached, updated property condition report. (Ord. 984 ss 2 (part), 1983: prior code ss
9853.8)
17.82.130 New project regulations—Standards to govern.
The standards contained in Section 17.82.140 shall govern new condominium projects. (Ord.
984 ss 2 (part), 1983: prior code ss 9854)
17.82.140 Property improvement standards for new condominium projects.
A- Private Open Space. There shall be provided with each unit a minimum of two hundred
fifty square feet of qualifying private open space for projects in the R-1 or R-2 zones, and a minimum
of one hundred square feet for projects in the R-3 or R-4 zones. To qualify, open space must be
private and directly accessible from the unit it serves, and must have a minimum dimension in every
Ordinance No.
Page 8
direction of ten feet for open space provided at ground level or six feet for open space provided on
a balcony or elevated deck, and must be located outside the street yard required by zoning
regulations.
B. Common open space. There shall be provided in each project a minimum of one hundred
square feet of qualifying open space per unit for projects in the R-3 or R4 zones. To qualify, open
space shall have a minimum dimension in every direction of ten feet for open space provided at
ground level or six feet for open space provided on a balcony or elevated deck, and must be located
outside the street yard required by zoning regulations. Common open space need not be located with
each unit. There is no minimum common open space requirement for projects in the R-1 and R-2
zones.
C. Total open space. There shall be provided in each project a minimum of one thousand
square feet per unit of qualifying private and common open space for projects in the R-1 zone, seven
hundred fifty square feet per unit for projects in the R-2 zone, and four hundred square feet per unit
for projects in the R-3 or R4 zones.
D. Common recreation facilities. There shall be provided in each project in the R-3 or R4
zones a minimum of twenty square feet per unit of common indoor recreation facilities, or forty
square feet per unit of improved outdoor recreation facilities. Common recreation facilities shall be
available for, and limited to, the use of the project's tenants and their guests. Common recreation
facilities must be located outside the street yard required by zoning regulations.
E. Open space and recreation facilities in nonresidential zones. Requirements for open space
and recreational facilities for projects in nonresidential zones shall be set by the council at the time
the project is reviewed.
F. Storage. Each dwelling unit shall have provision for at least two hundred cubic feet of
enclosed, weatherproof and lockable private storage space, exclusive of cabinets and closets within
the unit. This space shall be for the sole use of the unit owner. The minimum opening shall be two
and one half feet by four feet and the minimum height shall be four feet.
G. Laundry facilities. A laundry area shall be provided in each unit, or in common laundry
space. Common facilities shall consist of at least one washer and dryer for each ten units or fraction
thereof.
R Energy conservation. Solar water hearing shall be provided for each unit and appropriate
easements shall be providedlocations. ,;>; '
p for collector The community development duecior mayivaive
�lutFerneat forsolarivater heating sn cases where the chief burldmg official has.c�etermuted.that
ei{tiitvalent.,ene�gy sa�nngs,will be pbta�nec�,.by other means. Tenants shall not be prohibited from
installing clotheslines in private open areas which are substantially screened from common view.
17.82.150IJAOpIZI . Affordable Housing
Requirements.
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Ordinance No.
Page 9
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Pa}rtng anatt lieu housing fee,to the approval ofthe pity Council:
I $2�id0 Exceptions
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Upon request by a subdivider, the council may approve exceptions to property improvement
standards and/or affordable housing requirements for condounir conversion projects. The nature
of the exception shall be described in public notices for council hearing on the condominium map.
The council may act on the request only after a public hearing. In order to approve
an exception tion
6t}a i1?aziaEie"aff rda[ife'housin"re `u re ent P
far
n::.g....:.q:: the council must find that:
A There are circumstances of the site, such as size, shape or topography, distinct from land
in the same zoning, or compliance would not be practical because of the location or site design;
B. The variance will not constitute a grant of special privilege; an entitlement inconsistent
with the limitations upon other properties in the vicinity with the same zoning; and
C. No feasible alternative to authorizing the exception would satisfy the intent of the city
policies and regulations. (Ord. 052 ss 2, 1985; Ord. 984 ss 2 (part), 1983: prior code ss 9855)
F.ar exceptions to the affordable housing.requtremen#, the:Couttctl must only find that
D The protect will not materially reduce the Ci affordable housing stock ar d-
not
displace how or moderate;income hoasehalds. �
CMY of San 1wS OBISp0
HOUSING
�mmuull u
i
ELEMENT ,
September 1994
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1.22.11 The City will establish a housing trust fund to be used to develop affordableh housing
public
units and acquire land for affordable housing projects. To qualify
assistance, housing must include guarantees that it will remain affordable as long as
legally permissible. Affordable housing in-lieu fees will be placed in this fund.
1.22.12 The City will periodically review its building and planning regulations to see if there
are changes possible that could assist the production of affordable housing while not
conflicting with other General Plan policies. Such periodic review will aim to
remove regulations that are no longer needed.
1.22.13 The City will adopt procedures to speed the processing of applications and
construction permits for affordable housing projects that do not involve significant
planning issues or entitlements such as rezoning. City staff and commissions should
give such projects priority in allocating work assignments, scheduling, conferences
and hearings, and in preparing and issuing reports.
.1.22.14 The City will review its building and planning regulations to find ways to allow
construction by owner-builders of personalized, unconventional housing types that
reduce cost and/or energy and materials consumption, provided that residential
quality and safety can be maintained.
1.22.15 The City will amend its regulations to exempt certain affordable housing projects
from payment of development review, construction permit, sewer and water hookup
fees. Affordable housing units which are to be administered through the City's
Housing Authority, not-for-profit housing organizations, the County of San Luis
Obispo or other government agencies, and other public or private entities which
guarantee permanent affordability for low-and moderate income households, should
be eligible to seek exemption from such fees.
1.22.16 The City will revise its condominium conversion regulations to discourage or prevent
the conversion of affordable rental units to condominiums unless permanent
affordability guarantees, such as deed restrictions, are incorporated into the
conversion.
1.22.17 The City will help coordinate public sector and private sector actions to encourage
the development of housing affordable to low and moderate income households.
1.22.18 The City will enable issuance of mortgage revenue bonds to help develop or preserve
assisted units through: (1) below market financing and (2) subsidized mortgages for
low-income and moderate income, first-time home buyers.
15
���ii�►►Iilllllllli"'i►IIII
City of San Luis Obispo
AFFORDABLE HOUSING STANDARDS
June 1996
Purpose
These standards apply to all residential projects within the City. They set maximum rental
costs or sales prices based on income level and dwelling size and are used by developers,
citizens, housing groups, City staff and commissions, and housing agencies. The standards are
implemented by the Community Development Director. Besides defining the often
misunderstood term "affordable housing", the standards promote the construction of housing
which meets residents' needs, and help explain the City's housing requirements. For more
information about these standards, call Community Development at (805) 781-7170.
The City's Housing Element requires that a certain portion of new housing be sold or rented at
levels affordable to households of very-low, low, and moderate incomes. In addition, State
and local law allows residential density bonuses and certain other incentives in return for
developers agreeing to construct affordable housing, pursuant to Chapter 17.90 of the
Municipal Code. The City uses these standards to determine if housing projects are
"affordable" and qualify for density bonuses, incentives and other forms of housing
assistance.
How the Standards Are Determined
The standards prepared by the City's Community Development Department, and are updated
periodically to reflect income limits which are adjusted annually by the U.S. Department of
Housing and Urban Development (HUD) and published by the State Department of Housing
and Community Development (HCD) for each county, as shown in Table 1. By law, the
upper income limit for "very-low income" households is 50 percent of the median County
income; the upper limit for "lower income" households is 80 percent of the median County
income; and the upper limit for "moderate-income" households is 120 percent of the median
County income. At all income levels, the income limits for household sizes other than four
persons are calculated by multiplying the four-person income limit by the factor corresponding
to the number of persons in the household, and rounding to the nearest $50. HUD's
adjustment factors are as follows:
Number of persons: 1 2 3 4 5 6 7 8
Factor: .7 .8 .9 base 1.08 1..16 1.24 1.32
For example, the very-low income limit for a 5-person household is $21,650 X 1.08 =
$23,382, or$23,400.
Affordable Housing Standards
Page 2
TABLE 1: 1996 ANNUAL INCOME LIMITS
]INCOME NUMBER OF PERSONS IN HOUSEHOLD
GROUP
2 3 4 5 6 7 8
VERY LOW 15,150 17,300 19,500 21,650 23,400 25,100 26,850 28,600
LOWER 24,250 27,700 31,200 34,650 37,400 40,200 42,950 45,700
38X
30M: 34>650
.743 4.746750 50,250 33,700 .. . 57,150
MODERATE 36,350 41,550 46,750 51,950 56,100 60,250 64" 68,550
Families with more than eight persons. For all income groups, the income limits for
families larger than eight persons are determined as follows: For each person in excess of
eight, add eight percent of the four-person income limit to the eight-person income limit and
round the sum to the nearest $50. For example, the nine-person very-low income limit is
$302350 (.08X $21,650 = $1,732; $1,732 + 28,600 = $30,332; rounded to the nearest$50
$30,350).
Affordable Rent Limits
The maximum monthly rents, including costs of utilities, to qualify as affordable housing are
listed in Table 2. The limits are based on a formulas set by state law' and shall be computed
as follows:
0 For very-low income households: Affordable monthly rents shall not exceed 30% of 50%
of the annual median County income divided by 12, and adjusted for household/unit size
(Health & Safety Code Sec. 50105).
0 For lower-income households: Affordable monthly rents shall not exceed 30% of 60% of
annual median County Income divided by 12, and adjusted for household/unit size (H&S Code
Sec. 50079.5).
0 For moderate-income households: Affordable monthly rents shall not exceed 35% of
110% of the annual median County Income divided by 12, and adjusted for household/unit
size (H&S Code Sec. 50093).
For example, the monthly rent cost for a 2-bedroom dwelling affordable to a five-person,
lower-income household equals the median five-person household income divided by 12,
multiplied by .5, and that product multiplied by .3 ($46,750/12 =$3,896 X .5 X .3 = $584).
Affordable Housing Standards
Page 3
Affordable Sales Prices
-The maximum initial sales prices for affordable new housing are based on a formula which
accounts for what a typical very-low income, low-income and moderate-income household can
afford to pay for housing, following HUD guidelines. Sales price limits are determined by
multiplying the annual income limit of the income group, adjusted for household size,
multiplied by 2.5 for very-low and lower income households, and by'3 for moderate income
households. For example, the maximum initial sales price for a 2-bedroom dwelling would be
2.5 X $31,200 = $78,000 for a three-person, lower-income household; and 3 X $46,750 =
$140,250 for a three-person, moderate-income household. When the number of residents is
not known, the City's affordability standards assume the following household sizes
corresponding to the size of the proposed affordable dwellings, as defined in the Zoning
Regulations :
■ Studio unit: use the income limit for a one-person household.
■ One-bedroom unit: use the income limit for a two-person household.
■ Two-bedroom unit: use the income limit for a three-person household.
■ Three-bedroom unit: use the ave of limits for four and five-person households.
■ Four-bedroom unit: use the income limit for a six-person household.
Determining Maximum Rent Cost or Initial Selling Price
Using Table 2, determine household income group and read across to find rent or sales price
under the dwelling size. For example, the maximum monthly rental cost of a 1-bedroom
dwelling affordable to a very-low income household is listed as $433.
TABLE 2: 1996 Rent/Sales Affordability Standards
INCOME DWELLING SIZE
GROUP TENURE
STUDIO 1-BDRM 2-BDRM 3-BDRM 4-BDRM
VERY LOW MAIsEtM MoKrHLY $379 ; $433 $487 $563 $628
REM
MAXIMUM SALES $37,875 $43,250 $48,750 $56,313 $62,750
PRICE
LOWER IyiAxulUlr MoNr�rY $455 <$520 $584 $67S $7S4
RENT
MAXMUM SALES $60,625 $69,250 $78,000 $90,063 $100,500
PRICE
MODERATEMA7CA3LFMMoNTHLY $972 $1,112 $1;250 $1,445 $1612 <'
RENT
MAXMfUM SALES $109,750 $124,650 $140,250 $162,075 $180,750
PRICE
Affordable Housing Standards
Page 4
Maximum rent shall include a reasonable allowance for utilities paid directly by tenant (gas,
electricity, water, sewer, trash collection), but not cable TV or telephone. Sales prices may
exceed these amounts only if the City determines that the down payment, plus buyer's closing
costs and monthly payments (PITI) excluding utilities over the life of the financing, provide a
level of affordability equivalent to the maximum sales price financed at prevailing market
terms.
Long-term Affordability
Affordable rental housing units are maintained as affordable rentals through recorded
agreements between a property owner and the City, its Housing Authority, or another
government agency. These agreements shall specify: a) the maximum rents based on the
same formula which established initial rent levels as a condition of City approval; b) the term
for which rental units must remain affordable; and c) terms under which affordability is
maintained after sale or transfer of the property. By City ordinance, affordable dwelling units
must remain affordable for a minimum of 30 years, or as otherwise required by State law.
Affordable owner-occupied housing is maintained through an Affordable Housing Agreement
which typically is recorded as an encumbrance on the property, and secured by a recorded
deed of trust. The Agreement and deed of trust establish the monetary difference between the
initial purchase price and the initial appraised value as an "affordability loan" payable to the
City. The loan accrues interest at a rate to be set by the City when the agreement is executed,
amortized over 30 years or other mortgage term as allowed by the Lender. The monthly
payments (principal plus interest) on the affordability loan are waived as long as a City-
approved eligible owner continues to own and reside in the property as a principal residence.
Upon sale, transfer, gift or inheritance of the property, the City or its designated Housing
Authority, shall have first right of refusal to purchase the property at its current appraised
value. The consideration for the City's first right of refusal shall consist of 1 percent of the
remaining affordable loan balance. The balance of the City's loan, after deducting the 1%
first right of refusal cost, shall be credited toward the purchase price if the City or its
designated Housing Authority chooses to exercise its purchase option.
A/L mom,.q aN.cRe
Draft Planning Commission Minutes
October 9, 1996
Page 15
Commisst ner Kouralds asked if access will be limited on California.
Community elopment Director Jonas feels Public Works will severely limit access on California
if it is allowed all.
Commissioner Ko akis will support the motion. Initially she questioned the change because her
understand of the Ge ral Plan history was that it really had to do with tidying the land use lines on
the General Plan Map. is this kind of detail that you can't really expect citizens to take note of at
the time. It is not surpris' that the neighbors did not notice that. She has been convinced of tonight
that with the C-R with the that there will be a larger range of compatible activities available than
there would for C-R-with
There a so many limitations and restrictions on the lot, a broader spectrum
will be helpful.
AYES: Commissioners R y, Whittlesey, Kourakis, and Acting Chairman Senn
NOES: Commissioner Jeffre
ABSTAIN: None
ABSENT: Commissioner Veesart
The motion passed.
3. I1590 Los Osos Valley Road: U 97-96Xevie�w" of planning use permit to allow a carwash
and food sales expansion at an existie station; C-N Zone; Shell Oil Company,
applicant.
Commissioner Kourakis made a motion to continue this i m to the meeting of October 23, 1996.
The motion was seconded by Commissioner Whittlesey.
AYES: Commissioner Kourakis, Whittlesey, Jeffrey,K leskint, Ready, and Senn.
NOES: None
ABSENT: Commissioner Veesart
The motion passed.
4. Oitvwide. TA 122-96: Amendments to the Condominium Conversion Regulations to
require affordable housing and establish energy conservation standards; City of San Luis
Obispo, applicant.
Draft Planning Commission Mmutes
October 9, 1996
Page 16-
Associate
6-Associate Planner Hook presented the staff report and recommended the Commission recommend
that the Council amend the Municipal Code to: 1) require affordable housing in connection with
condominium conversion; and 2) allow the Community Development Director to waive the solar
water heating requirement for condominiums when equivalent energy savings are demonstrated.
Associate Planner Hook noted some minor corrections to the draft ordinance and described them to
the Commission.
PUBLIC COMMENTS:
There were no public comments made.
COMMISSIONERS' COMMENTS:
Commissioner Jeffrey asked Associate Planner Hook to expand on developer's option#4, the paying
an in-lieu housing fee to meet the affordable housing requirement for condominium conversions.
Associate Planner Hook explained that this follows from one of the programs in the Housing Element
calls for the City to establish an inclusionary housing program which includes the possibility of
meeting the requirement by paying in-lieu fees. The program would require developers to provide
affordable housing in connection with new commercial or residential development.
Commissioner Jeffrey asked how the in-lieu funds would be used.
Associate Planner Hook stated that funds would go into a housing trust fund maintained by the City,
and would be used to help offset development costs of affordable housing. The intent is to build up
a revolving fund that could be used to acquire property for affordable housing, or assist with the cost
of building affordable housing.
Commissioner Jeffrey questioned whether it might be better to spell out the in-lieu housing program
fee prior to enacting this ordinance amendment.
Associate Planner Hook noted that both the inclusionary housing program and in-lieu fees are
included in the adopted Housing Element, and an implementing ordinance is in preparation. The
inclusionary housing/in-lieu fee ordinance will come to the Planning Commission soon, perhaps as
early as next month. Staff did not see a problem with enacting the condominium conversion
amendments at this time.
Commissioner Whittlesey asked the amendments proposed a rental affordability term of three years.
Associate Planner Hook stated that the three years would be a minimum, and that the actual tern of
affordability would be negotiated by the developer and the City prior to occupancy, but for no less
Draft Planning Commission Minutes
October 9, 1996
Page 17
than three years. The intent is to give low- and moderate income tenants a reasonable length of time
to find other affordable housing.
Commissioner Whittlesey questioned the 90-day notice to tenants of a first right of refusal.
Mr. Hook explained that within that 90 days of receiving the notice, tenants would have the right to
enter into an escrow to purchase their units at affordable prices. The ordinance does not require that
escrow closes within the 90 days.
Commissioner Whittlesey asked if the Council would have to make all of the findings listed under
Chapter 17.82.160 to grant an exception to the affordable housing requirement.
Mr. Hook replied that to grant an affordable housing exception, Council need only make finding
17.82.160 (D). The other three findings must be made for exceptions to physical development
standards such as reduced setbacks or height exceptions.
Commissioner Senn asked how frequently condominium conversions happened.
Mr. Hook stated that condominium conversions were infrequent, and that he could not remember the
last conversion approved in the City.
Commissioner Senn asked if a student with a low income who receives notice that there's going to
be a conversion will be in a windfall situation.
Mr.Hook stated that windfalls would be prevented by deed restrictions which required the units to
remain affordable upon resale.
Commissioner Senn asked if tenant could then buy an affordable unit and keep it under the deed
restriction and rent it.
Associate Planner Hook stated deed restrictions would normally preclude an affordable unit from
being used as a rental unit or subleased. It was the City's intent that the affordable unit be
owner occupied.
Commissioner Ready questioned the enforcement of the Right of refusal, 17.82.080. He asked how
specific were the terms and conditions of performance.
Associate Planner Hook stated this wording of this provision comes directly from the California
Government Code.
Commissioner Ready feels this provision may be unenforceable.
Draft Planning Commission Minutes
October 9, 1996
Page 18
Community Development Director Jonas stated this ordinance doesn't spell out exactly the legal
mechanisms for the transactions. This will be handled through normal escrow procedures and
through the agreement between the City and the developer.
Commissioner Ready stated 17.82.100,Item D, needs to have added "or that low or moderate income
persons will not be displaced by the proposed conversion."
Commissioner Senn suggested adding "residential" before "Condominium Development and
Conversion" in the amendment's title.
Commissioner Ready suggested adding "siogiacantly or substantially reduce" to 17.82.160,D.
Commissioner Senn made a motion to recommend that the City Council introduce an ordinance and
amend Chapter 17.82 of the Municipal Code as shown in the attached draft ordinance, subject to the
amendments of the Commission's discussions and allow the Community Development Director to
waive the solar water heating requirement for condominiums when equivalent energy savings are
demonstrated. The motion was seconded by Commissioner Kourakis.
AYES: Commissioners Senn,Kourakis,Whittlesey, Ready, Jeffrey, and Chairman Karleskint
NOES: None
ABSTAIN: None
ABSENT: Commissioner Veesart
The motion carried.
COMMENT AND DISCUSSIO .
5. Staff
A. Agenda Forecast
Long Range Planning Manager Mandevill%special
agenda forecast for the meetings of October
23rd,November 13th, and suggested holdeting to receive public testimony on the EIR
for Perfumo Canyon homes projects.
6. Commission
A. Consideration of special meeting to d\PeCreek Homes Tract and
Environmental Review.