HomeMy WebLinkAbout07/06/1993, C-10 - AGREEMENT WITH BIA FOR ECONOMIC STABILIZATION FUNDING I����II�R���lylllllllllil�lll "J f p _ MEETING f3'
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COUNCIL AGENDA REPORT ITEM NUMBEF: �!O
FROM: Ken Hampian, Assistant City Administrative Officer PA- �
SUBJECT: Agreement with BIA for Economic Stabilization Funding
CAO RECOMMENDATION: Approve and authorize the Mayor to execute an agreement
with the Downtown Business Improvement Association for $15,000 in 1992-93 Economic
Stabilization funding in order to cant' out a business retention program.
DISCUSSION:
During the Council meeting of June 15, 1993, the City Council approved an allocation of
$15,000 in 1992-93 Economic Stabilization funding for a Business Retention Program
proposed by the BIA, and directed staff to draft an agreement for use of the funding. The
recommended agreement is attached. In summary, the agreement provides $15,000 to be
used toward the preparation of a downtown map/brochure ($3,000), a commercial
marketing survey ($5,000), and professional development seminars ($7,000). The program
will be carried out consistent with the BIA's formal proposal, and with the following other
key provisions negotiated by staff:
1. The allocation is for 1993-94 only, and not for ongoing program support.
2. $5,000 of the total request shall be allocated upfront, with the remaining $10,000
balance provided after a matching commitment from the private sector has been
confirmed. If $10,000 in private contributions are not raised by June 30, 1994, then
the City will only be obligated to provide matching funds up to the lower amount
raised.
3. The $5,000 upfront contribution shall be used to support the completion of the
commercial marketing survey. The remaining$10,000 City contribution shall be used
for the other purposes noted previously. The $10,000 in private matching funds are
intended to support a downtown promotional campaign. City staff will have the
opportunity to review and verify the results of the various activities to be supported
through the program.
FISCAL IMPACT:
Based on the Council action of June 15, 1993, $15,000 in 1992-93 Economic Stabilization
funding has been encumbered to support this contract. This program, therefore, will have
no impact on the $100,000 set aside for the current fiscal year. Staff has recommended that
determinations for the use of current fiscal year funding be deferred until recommendations
from the Economic Strategy Task Force are adopted, and all proposed programs can be
considered in this larger context.
ATTACHMENT:
Proposed Agreement
AGREEMENT WITH THE DOWNTOWN
BUSINESS IMPROVEMENT ASSOCIATION
FOR A BUSINESS RETENTION PROGRAM
This agreement made this _ day of . 1993 by and between the CITY
OF SAN LUIS OBISPO, California (hereinafter referred to as "City"), and the BUSINESS
IMPROVEMENT ASSOCIATION (hereinafter referred to as "Contractor").
Whereas, the City is committed to preserving a healthy and sustainable economy in San Luis
Obispo; and
Whereas, the City has set aside funding to support economic stability programs; and
Whereas the Contractor has submitted a proposal for use of $15,000 of this funding for
purposes of business retention; and
Whereas, the Contractor is organized and equipped to carry out the programs proposed.
Whereas, the City believes that the programs are consistent with the intent of the Economic
Stability Program.
NOW, THEREFORE, in consideration of their mutual covenants, the parties hereto agree
as follows:
1. PROGRAM COORDINATION
A. Liu. The City Administrative Officer or his designated representative, shall
be the Project Manager representing the City for all purposes under this
agreement. The Project Manager shall supervise the progress and execution
of this agreement.
B. Contractor. Contractor shall assign a single Project Manager to have overall
responsibility for the progress and execution of this agreement for Contractor.
Lynn Block is hereby designated as the Project Manager for Contractor.
Should circumstances or conditions subsequent to the execution of this
agreement require a substitute Project Manager for any reason, the Project
Manager designee shall be subject to the prior written acceptance and
approval by City Project Manager.
2. DUTIES OF CONTRACTOR
A. The Contractor will provide services consistent with the proposal outlined in
Exhibit "A". In addition, the following provisions are agreed upon:
Page 2
AGREEMENT - BIA
1. City funding for this program shall be budgeted for Fiscal Year 1993-
94 only; therefore, any funding not released by the City by June 30,
1994 shall cease to be available for this program.
2. City funding will be used for the following purposes, in the amounts
shown:
■ Commercial Marketing Survey - $5,000
■ Downtown Map/Brochure - $3,000
■ Professional Development Seminars - $7,000
3. The $5,000 for the Commercial Marketing Survey shall be made
available to the Contractor shortly after execution of the agreement.
City Project Manager will have the opportunity to participate in the
preparation of the survey, and should agree with its content prior. to
distribution. The City shall be provided with the results upon
completion.
4. The remaining $10,000 City contribution will be released to the
Contractor only after the Contractor has verified, to the satisfaction of
the City Project Manager, that the additional private sector
contributions have been raised, specifically for the downtown
promotional program,as described in Exhibit"A". These private sector
funds shall be funds newly raised for this purpose and shall
supplement, and not supplant, existing funds budgeted by the BIA for
promotional purposes. The City is willing to release its $10,000 in two
phases: $3,000 for the downtown brochure when a like amount in
private contributions has been verified; the $7,000 balance after the
remainder in private contributions has been verified.
5. The City Project Manager shall have the opportunity to review the
downtown brochure prior to final printing. The City Project Manager
should also be advised of each professional development seminar prior
to it being held. A report to the City should be provided following
each seminar which provides information on cost, attendance, and
participant evaluation.
6. If private sector contributions do not reach $10,000 by June 30, 1994,
then the City shall match, on a dollar-for-dollar basis, the lower level
of private contributions generated. The City shall have no further
obligation beyond this amount.
Page 3
AGREEMENT - BIA
B. Laws to be observed by Contractor.
1. Procure all permits and licenses, pay all charges and fees, and give all
notices which may be necessary and incidental to the due and lawful
prosecution of the services to be performed by Contractor under this
agreement.
2. Keep itself fully informed of all existing and proposed federal, state
and local laws, ordinances, regulations, orders, and decrees which may
affect those engaged or employed under this agreement, any materials
used in Contractor's performance under this agreement, or the conduct
of the services under this agreement.
3. At all times observe and comply with, and cause all of its employees
to observe and comply with all of said laws, ordinances, regulations,
orders, and decrees mentioned above.
4. Immediately report to the City's Project Manager in writing any
discrepancy or inconsistency it discovers in said laws, ordinances,
regulations, orders, and decrees mentioned above in relation to any
plans, drawings, specifications, or provisions of this agreement.
C. Copies of reports and information. If City requests additional copies of
reports, drawings,specifications,or any other materials in addition to what the
Contractor is required to furnish in limited quantities as part of the services
under this agreement, Contractor shall provide such additional copies as are
requested, and City shall compensate Contractor for the costs of duplicating
of such copies at Contractor's direct expense.
D. Oualifications of Contractor. Contractor represents that it is qualified to
furnish the services described under this agreement.
E. Notwithstanding any representations, oral or written, between parties,
including any and all agents or representatives thereof, Contractor at all times
covered by the terms of this agreement is acting as a free and independent
contractor, not as any agent of the City. Any and all supervision and direction
by any City official, department or body shall be only that necessary to
provide broad general outlines, and Contractor will use its own initiative and
discretion in'performing the details of work herein.
Page 4
AGREEMENT - BIA
F. All services provided by the Contractor listed within this agreement are in
addition and beyond those of any and all other contracts currently held
between the City and Contractor.
3. DUTIES OF CITY
City agrees to cooperate with Contractor and to perform work described hereto and
incorporated by this reference.
4. COMPENSATION
City shall pay to Contractor the following sums for furnishing said services:
A. Five Thousand Dollars ($5,000) shortly after execution of the agreement for
purposes of completing a commercial marketing survey.
B. The balance of $10,000 in the manner, and for the purposes, outlined under
Section 2.A, of this agreement.
5. TIME FOR COMPLETION OF THE WORK
Program is for the period commencing July 7, 1993 and ending on June 30, 1994.
6. TEMPORARY SUSPENSION
The City Project Manager shall have the authority to suspend this agreement wholly
or in part, for such period as he deems necessary due to unfavorable conditions or
to the failure on the part of the contractor to perform any provision of this
agreement. Contractor will be paid the compensation due and payable to the date
of temporary suspension.
7. SUSPENSION; TERMINATION
A. Right to suspend or terminate. The City retains the right to terminate this
agreement for any reason by notifying Contractor in writing sixty (60) days
prior to termination and by paying the compensation due and payable to the
date of termination; if this agreement is terminated for fault of Contractor,
C�0-5
Page 5
AGREEMENT - BIA
City shall be obligated to compensate Contractor only for that portion of Contractor
services which are of benefit to City. Said compensation is to be arrived at by
mutual agreement of the City and Contractor and should they fail to agree, then an
independent arbitrator is to be appointed by mutual agreement and his decision shall
be binding upon the parties.
8. INSPECTION
Contractor shall furnish City with every reasonable opportunity for City to ascertain
that the services of Contractor are being performed in accordance with the
requirements and intentions of this agreement. All work done and all materials
furnished, if any, shall be subject to the City's Project Manager's inspection and
approval. The inspection of such work shall not relieve Contractor of any of its
obligations to fulfill its agreement as prescribed.
9. NOTICE
All notices hereunder shall be given in writing and mailed, postage prepaid, by
Certified Mail, addressed as follows:
To Contractor: Business Improvement Association
P.O. Box 1402
San Luis Obispo, CA 93406
Attention: Lynn Block
To City: City of San Luis Obispo
P. O. Box 8100
San Luis Obispo, CA 93403-8100
Attention: Ken Hampian, Assistant CAO
10. INTEREST OF CONTRACTOR
Contractor covenants that it presently has no interest, and shall not acquire any
interest direct or indirect financial or otherwise, which would conflict in any manner
or degree with the performance of the services hereunder. Contractor further
covenants that, in the performance of this agreement, no subcontractor or person
having such an interest shall be employed. Contractor certifies that no one who has
or will have any financial interest under this agreement is an officer or employee of
the City. It is hereby expressly agreed that, in the performance of the services
hereunder, Contractor shall at all times be deemed an independent contractor and
not an agent or employee of the City.
Page 6
AGREEMENT - BIA
11. INDEMNITY
Contractor hereby agrees to indemnify and save harmless City, its officers, agents,
and employees:
A. Any and all claims and demands which may be made against City, its officers,
agents or employees by reason of any injury to or death of any person or
corporation caused by any negligent act or omission of Contractor under this
agreement or of Contractor's employees or agents;
B. Any and all damage to or destruction of the property of City, its officers,
agents, or employees, occupied or used by or in the care, custody, or control
of Contractor, or in proximity to the site of Contractor's work, caused by any
negligent act or omission of Contractor under this agreement or of
Contractor;
C. Any and all claims and demands which may be made against City, its officers,
agents, or employees by reason of any injury to or death of or damage
suffered or sustained by any employee or agent of Contractor under this
agreement,however caused,excepting, however,any such claims and demands
which are the result of the negligence or willful misconduct of City, its
officers, agents, or employees;
D. Any and all claims and demands which may be made against City, its officers,
agents, or employees by reason of any infringement or alleged infringement
of any patent rights or claims caused by the use of any apparatus, appliance,
or materials furnished by Contractor under this agreement; and
E. Any and all penalties imposed or damages sought on account of the violation
of any law or regulation or of any term or condition of any permit, when said
violation of any law or regulation or of any term or condition of any permit
is due to negligence on the part of the Contractor.
Contractor, at its own costs, expense, and risk, shall defend any and all suits, actions,
or other legal proceedings that may be brought against or for employees on any such
claim or demand of such third persons, or to enforce any such penalty, and pay and
satisfy any judgement or decree that may be rendered against City, its officers,
agents, or employees in any such suit, action or other legal proceeding, when same
were due to negligence of the Contractor.
C-lD-7
Page 7
AGREEMENT - BIA
12. WORKERS COMPENSATION
Contractor certifies that it is aware of the provisions of the Labor Code of the State
of California,which require every employer to be insured against liability for workers
compensation or to undertake self-insurance in accordance with the provisions of that
code, and it certifies that it will comply with such provisions before commencing the
performance of the work of this agreement.
13. INSURANCE
Contractor shall provide proof of insurance in accordance with Insurance
Requirements for Consultants as described in Exhibit "2" attached hereto and
incorporated herein by reference as though here fully set forth.
14. AGREEMENT BINDING
The terms, covenants, and conditions of this agreement shall apply to, and shall bind,
the heirs, successors, executors, administrators, assigns, and subcontractors of both
parties.
15. WAIVERS
The waiver by either party of any breach or violation of any term, covenant, or
condition of this agreement or of any provision, ordinance, or law shall not be
deemed to be a waiver of any subsequent breach of violation of the same or of any
other term, covenant, condition, ordinance, or law. The subsequent acceptance by
either party of any fee or other money which may become due hereunder shall not
be deemed to be a waiver of any preceding breach or violation by the other party of
any term, covenant, or condition of this agreement or of any applicable law or
ordinance.
16. COSTS AND ATTORNEY FEES
The prevailing party in any action between the parties to this agreement brought to
enforce the terms of this agreement or arising out of this agreement may recover its
reasonable costs and attorney's fees expended in connection with such an action from
the other party.
17. DISCRIMINATION
No discrimination shall be made in the employment of persons under this agreement
because of the race, color, national origin, ancestry, religion, sexual orientation, or
sex of such person.
,2-10-9
Page 8
AGREEMENT - BIA
If Contractor is found in violation of the nondiscrimination provisions of the State
of California Fair Employment Practices Act or similar provisions of federal law or
executive order in the performance of this agreement, it shall thereby be found in
material breach of this agreement. Thereupon, City shall have the power to cancel
or suspend this agreement, in whole or in part, or to deduct from the amount payable
to Contractor the sum of Twenty-Five Dollars ($25) for each person for each
calendar day during which such person was discriminated against,as damages for said
breach of contract, or both. Only a finding of the State of California Fair
Employment Practices Commission or the California Fair Employment Practices
Commission or the equivalent federal agency or officer shall constitute evidence of
a violation of contract under this paragraph.
If Contractor is found in violation of the nondiscrimination provisions of this
agreement or the applicable affirmative action guidelines pertaining to this
agreement, Contractor shall be found in material breach of the agreement.
Thereupon, City shall have the power to cancel or suspend this agreement, in whole
or in part, or to deduct from the amount payable to Contractor the sum of Two
hundred Fifty Dollars ($250) for each calendar day during which Contractor is found
to have been in such noncompliance as damages for said breach of contract, or both.
18. AGREEMENT CONTAINS ALL UNDERSTANDINGS
This document represents the entire and integrated agreement between City and
Contractor and supersedes all prior negotiations, representatives, or agreements
either written or oral. This document may be amended only by written instrument,
signed by both City and Contractor. All provisions of this agreement are expressly
made conditions. This agreement shall be governed by the laws of the State of
California.
IN WITNESS WHEREOF, City and Contractor have executed this agreement on the day
and year first above written.
DOWNTOWN BUSINESS IMPROVEMENT ASSOCIATION
BY: . lcjL�
ick Cleeves, President
Page 9
AGREEMENT - BIA
CITY OF SAN LUIS OBISPO
BY:
Peg Pinard, Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
tto ey
kh\biaagree
BUSINESS IMPROVEMENT ASSOCIATION
ECONOMIC ENHANCEMENT/BUSINESS RETENTION PROGRAM
From it' s inception, the Business Improvement Association
has played a valuable role as the liaison and uniting force
between the business community and the City of San Luis
Obispo.
As the downtown enjoyed a prosperous decade in the 1980 ' s,
the BIA played the role of promoter and developer of the
downtown. The key for continued success of the downtown in
the 1990 ' s will be the management and revitalization of the
BIA district.
As stated by the International Downtown Association,
'management districts, voluntary or legislated, have become
tools of primary importance in implementing programs and
services necessary for the economic success of the
downtown. '
Based on the mission of the BIA to provide vital business
services and promote the downtown, the Association is
requesting funds to develop a comprehensive business
retention program for downtown San Luis Obispo. The focus
of this project will be on renewal and retention of downtown
businesses.
COMPONENTS OF THE PROGRAM:
The business enhancement and retention program would have
three components aimed at improving the operational
procedures of the BIA membership, promoting downtown to new
customer markets, and creating a long term, comprehensive
marketing program.
These components include:
I . Professional Development Seminars
In Store Merchandising Techniques
Window Displays, awnings, and signage
Advertising Techniques
Shopper Preferences Surveys and Utilization
Small Business Administration programs
Assistance with SBA and local small business loan
applications
TOTAL COST: $7,000.00
These seminars would be created with local educational
resources.
EXHIBIT A
The Commercial Marketing component would utilize local
professional marketing research firms to analyze and present
a comprehensive marketing program for the downtown business
community. This program cost would be $5 ,000 .00
The total costs for the three components of the program
would be:
DOWNTOWN MAP $ 31000.00
DOWNTOWN CAMPAIGN 10,000. 00
PROFESSIONAL DEVELOPMENT SEMINARS 71000.00
COMMERCIAL MARKETING PROGRAM 5,000.00
TOTAL PROGRAM COSTS 25,000.00
CITY ECONOMIC STABILITY REQUEST 15,000.00
DEGREE OF CITY WIDE BENEFIT:
Sales tax revenue accounts for 30% of the total city
revenue. The BIA district represents the second largest
source of sales tax to the City at 16%. The BIA district
also reported a 9% increase in sales tax for the 4th quarter
of 1992 which was the largest increase for the past 8
quarters for any City area.
The key to a prosperous downtown over the long term is
attributed to several fundamental elements. Quality
merchandise, customer services, joint City/BIA marketing,
property owner involvement, and on-going special events are
ingredients in to the mixture of a successful downtown.
The BIA program would address these areas and assist the
locally operated businesses downtown in a variety of areas.
Any program that works to promote and enhance business in
the downtown would have reciprocal benefits to the entire
community through support of the General Fund.
Economic stability funding has already been designated by
the City Council for application to projects directly tied
to sales tax generation outside the downtown including the
Dalidio Environmental Impact Report and Auto Row Expansion.
Funding a program to develop economic stability in the
downtown would enhance the community of San Luis Obispo and
support the non-profit groups and basic services which
derive their financial basis from the City.
SHARED RESPONSIBILITY:
The success of this program depends on the joint partnership
between public and private entities. The BIA is actively
soliciting the following groups for support of the program:
Cities promotional and economic gains:
* development of a partnership with business that
focuses on retention
* proactive management of the sales tax revenue
* commitment to the downtown demonstrated with
appropriation of funds for economic stability
program.
SUMMARY.
The BIA understands the needs of the downtown business
community through its active role as a small business
advocate. However, no business retention program for the
downtown community can be successful with out the support of
the City of San Luis Obispo.
The BIA looks forward to the creation of this partnership
for the benefit of the City of San Luis Obispo.
bio�3
Exhibit 3
INSURANCE REQUIREMENTS FOR CONTRACTORS
Contractor shall procure and maintain for the duration of the contract Insurance against claims for injuries to persons or damages
to property which may arise from or in connection with the performance of the work hereunder by the Contractor, his agents,
representatives,employees or subcontractors.
Minimum Scope of trtstrrence
Coverage shall be at least as broad as:
1. Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).
2 Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any auto).
3. Workers' Compensation Insurance as required by the State of California and Employer's Liability Insurance.
Minimum Limits of insurance
Contractor shall maintain limits no less than:
I. General Liability. $1,000,000 per occurrence for bodily Injury, personal injury and property damage. If Commercial
General Liability or other form with a general aggregate limit is used, either the general aggregate limit shall apply
seParately to this project/location or the general aggregate limit shall be twice the required occurrence limit.
2 Automobile Llability. $1,000,000 per accident for bodily injury and property damage.
3. Employer's Liability. $1,000,000 per accident for bodily injury or disease.
Deduchbles andSelf-Insured RMentions
Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City, either: the
insurer shall reduce or efuninate such deductibles or self-insured retentions as respects the City,Its officers, officials,employees
and volunteers; or the Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim
administration and defense expenses.
Other Insurance Provisions
The general liability and automobile liability policies are to contain,or be endorsed to contain, the following provisions:
1. The City,Ns officers, Officials, employees, agents and volunteers are to be covered as insureds as respects: liability
arising out of activities performed by or on behalf of the Contractor, products and completed operations of the
Contractor, premises owned,occupied or used by the Contractor, or automobiles owned leased, hired or borrowed by
the Contractor. The coverage shall contain no special limitations on the scope of protection afforded to the City, its
officers,official, employees,agents or volunteers.
2 For any claims related to this project,the Contractor's insurance coverage shall be primary insurance as respects the
City, its officers, officials,employees,agents and volunteers. Any insurance or self-insurance maintained by the City,
its officers, officials, employees, agents or volunteers shall be excess of the Contractor's insurance and shall not
contribute with It
3. Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect
coverage provided to the City. Its officers,officials, employees, agents or volunteers.
4. The Contractor's insurance shall apply separately to each insured against whom claim is made or suit is brought,except
with respect to the limits of the insurer's liability.
5. Each insurance polity required by this clause shall be endorsed to state that coverage shall not be suspended,voided,
cancelled by either party, reduced in coverage or in limits except after thirty (30) days'prior written notice by certified
marl, return receipt requested, has been given to the City.
AcceotabW of Insurers
Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VIL
Verifieation of Ommerage
Contractor shall furnish the City with original endorsements affecting coverage required by this clause. The endorsements are
to be signed by a person authorized by that Insurer to bind coverage on its behalf. All endorsements are to be received and
approved by the City before work commences.
SubmrttractoFs
Contractor shall Include all subcontractors as Insured under Its policies or shall furnish separate certificates and endorsements
for each subcontractor. All coverages for subcontractors shall be subject to all of the requirements stated herein.
14
e 0�
s s l ,.97Z56 �To_ _75 d-11 0 177Wz 7-G- 93 1*&JbR
PETE WILSON Governor
STATE OF CALIFORNIA•BUSINESS TRANSPORTATION AND HOUSINQ AQE�tCY y9
DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT
DIVISION OF HOUSING POLICY DEVELOPMENT Cc : rt7c,V
lsoo THIRD STREET,Rooth 430 iJ
P.O BOX 952053 _,C fy' � /f" (�f• J Q . J /'ecl�p0/1��
SACRAN1B.1"r0,CA 94252.2053 J�. 7
NJ
(916) 327.3116 FAX(916)323-6625
C oostsPo c Gcs�.vc.' 7�2o�t7d,
SAm tuts July 1, 1993 -
Post-lfv brand fax transmittal memo 7671 V o1 pages ► I�_1
Mr. John Dunn To F"^�.Q CvI1D�'c
city manager
Co. Co.
city of San Luis Obispo
San Luis Obispo, California 93403 Dept. Pho�ee
Dear Mr. Dunn: F " _ Faxxy
RE: Review Of San Luis Obispo' s Draft Housing Element J
Thank you for submitting San Luis Obispo's draft housing
element, received June 1, 1993 for our review. As you know, we
are required to review draft housing elements and report our
findings to the locality (Government Code Section 65585 (b) ) .
Identified concerns were reviewed in a telephone
conversation on June 24 , 1993 with Jeff Hook, the City's Project
Planner. This letter and Appendix contain a summary of that
discussion.
The draft element contains much useful information about the
City' s housing environment and outlines an extensive array of
policies and programs. However, revisions are needed for the
element to comply with State housing element law (Article 10. 6 of
the Government Code) .
In particular, the element should clarify the availability
of adequate sites to accommodate the City's regional housing
needs, include programs to address the City's constraints on
housing development, and include more specific program actions.
The Appendix to this letter outlines these and other revisions
needed to bring the element into compliance.-
We appreciate the City's efforts to work cooperatively with
the Department to bring its housing element into compliance with
state law, we remain committed to helping the City develop a
housing element which addresses all of its housing needs and
enables the City to receive Community Development Block Grant
Funding to address those needs. We will be happy to meet w,*
the City again to provide additional direct assistance t&-Af' ^ on
City in revising its programs and policies to comply wit- , t `�I
�`O aiD D7!P,
law. I [ CAO ❑ FIN.DR.
LO ❑ �� r.„
f{ G_Z`^'Y ❑ FW D.R.
C) LTPL D_iL
I�
1
1
Mr. John Dunn
Page 2
We hope our comments are helpful to the City and we
appreciate the assistance of Mr. Hook during the course of our
review. If you have any questions concerning our comments, or
would like assistance in revising the element, please contact
Gary Collord of our staff at (916) 327-2644 .
In accordance With requests pursuant to the Public Records
Act, we are forwarding copies of this letter to the persons and
organizations listed below.
Sincerely,
000OA4
Thomas B. Cook
Deputy Director
Enclosures
cc: Assemblymember Andrea Seastrand
Senator Gary Hart
Peg Pinard, Mayor, City of San Luis Obispo
Debbi Hosli, Administrative Analyst, City of San Luis Obispo
Arnold Jonas, Director of Community Development, City of San
Luis Obispo
Jeff Hook, Project Planner, City of San Luis Obispo
Jeanette Duncan, Peoples' Self-Help Housing
Kathleen Mikkelson, Deputy Attorney General
Bob Cervantes, Governor's Office of Planning and Research
Dwight Hanson, California Building Industry Association
Kerry Harrington Morrison, California Association of
Realtors
Marc Brown, California Rural Legal Assistance Foundation
Rob Wiener, California Coalition for Rural Housing
Susan DeSantis, The Planning Center
Dara Schur, Western Center on Law Poverty
s
APPENDIX
City of San Luis Obispo
The following changes would bring San Luis Obispo' s housing
element into compliance with Article 10.6 of the Government code.
Following each recommended change or addition, we refer to the
applicable provision of the Government Code. Where particular
program examples or data sources are listed, these suggestions
are for your information only. We recognize that the City may
choose other means of complying with the law.
A. Housing Needs. Resources and Constraints
1. Identify the City's projected regional housing deeds for all income groups
(Section 65533 (a)(1)).
The City's projected housing needs, as reported in the
1991 Regional Housing Needs Plan for the San Luis
Obispo City Region, for the planning period (January 1,
1991 to July 1, 1997) are as follows:
Very Low 1, 333
Other Lower 820
Moderate 11077
P.bove Moderate 1, 898
Total 51128
2. Clarify the availability of land suitable for residential development for all
income groups, iazcluding vacant sites and sites having potential for
redet,elopm.ent, and describe the relationship of zoning and the availability of
public sen4ces and facilities to the sites (Section 65583(a)(3)).
It is not possible to determine whether the City has
sufficient sites available to accommodate its housing
needs for all income groups from the analysis provided
in the element (pages 38-44) . While Table 14 clearly
illustrates the amount of vacant residential land in
each zone, it is not clear how much land having infill
(i.e. , sites which are underdeveloped) or recycling
(i.e. , sites with older or decaying uses) potential is
also available in each zone. To clarify this, Table 14
could include a separate column which identifies the
amount of land having infill or recycling potential in
each zone.
The inventory should also specify the permitted
development density range of each zone permitting
residential development and indicate expected
development densities based upon recent development
trends or on the basis of identified slope constraints.
This information should be provided for vacant sites
and sites having infill or recycling potential.
s
Since it appears the City will need to rely upon sites
having redevelopment potential to accommodate some of
its housing needs, the element should also demonstrate
this potential by indicating the net number, type, and
density of units historically created (e.g. , during the
last five years) through infill, recycling of underused
or older residential sites, mixed-use developments, or
the element should estimate future potential based on
programs to encourage and promote such development.
The inventory should also clarify which sites are
located within the City (or are proposed" for annexation
within the planning period) and have, or will have,
access to all of the essential facilities and services
necessary to support development within the planning
period.
According to Table 6 of the element, the additional
water supplies needed to accommodate the City's
regional housing needs are expected to be available
towards the end of the current planning period. As a
result, the City could include sites in the expansion
areas in the inventory provided the element includes
specific programs to annex and facilitate the
development of such sites within the planning period.
3. Expand the analysis of the City's land use controls, permit fees, and permit
processing procedures; and analyze the City's building codes and enforcement
procedures as potential and actual govetytmenlal constraints upon the
maintenance, improvement, and development of housing for all uncome groups
(Section 65583(c)(4)).
a. The analysis of land use controls should be
expanded to describe and analyze zoning and other
land development regulations such as building
setback and height standards, on-site open space
and parking requirements, and design review
requirements for single and multifamily
residential zones.
b. The analysis of permit fees and exactions should
be expanded to describe and analyze permit fee
costs for various residential development
applications (e.g:,-tract map, conditional use
permit, zone change, environmental reviews, etc. ) .
C. The analysis of permit processing procedures
should be expanded to describe and analyze
discretionary review requirements and typical
processing timelines for various residential
development applications (e.g. , tract maps,
planned developments, conditional use permits,
site plan reviews, environmental reviews, etc. )
2
d. The analysis of building codes and enforcement
procedures should describe and analyze any local
amendments to the uniform building codes and the
City 's procedures for identifying and resolving
residential code violations.
Where constraints are identified, the element should
include programs to mitigate them or, where appropriate
and legally possible, remove them (see item C-2, below)
(Section 65583 (c) (3) ) .
4. Expand the analysis of the availability of financing and the cost of
construction as a potential or actual nongoventmental constraint upon the
maintenance, improvement, or development of housing for all income groups
(Section 65583 (a)(5)).
a. The analysis of the availability of financing
should describe whether financing is generally
available in all regions of the City and whether
there are mortgage deficient areas in the City for
purchase, new construction, or rehabilitation
loans.
b. The analysis of residential construction costs
should describe typical developer costs for land,
fees, materials, labor and financing for typical
single and multifamily developments.
5. Expand the analysis of the special housing needs of the honudess (Section
6.5-583(a)(6)).
The analysis of the City's homeless population should
include an estimate of the daily average number of
persons and families in the City lacking permanent
shelter. Where possible, the analysis should describe
the characteristics of the local homeless population
(e.g. , single males, single females, families, mentally
ill, substance abusers, etc) .
The analysis should also include a count of the number
and type of shelter beds, motel vouchers, or
transitional housing available in the City to establish
whether there is a need for additional shelter
facilities and the types of 'facilities 'needed':
6. Analyze and docutnent household and housing characteristics including
overpayment and housing stock conditions and expand the analysis of
overcrowded housing units (Section 65583 (c)(2)).
The analysis of overpayment should identify the number
and proportion of lower-income renter- and owner-
occupied households overpaying for housing. For
3
example, according to the 1990 Census, 89 percent of
all renter households with incomes less than 20, 000 per
year are paying 30 percent or more of their income for
housing (see enclosed data) .
The analysis of overcrowding should be expanded to
identify the number and proportion of renter- and
owner-occupied housing units which meet the Census
definition of overcrowding (i.e. , one or more persons
per room) . For example, according to the 1990 Census,
6. 5 percent of the City 's renter households are
overcrowded compared with 1. 4 percent of owner-occupied
households (see enclosed data) .
The analysis of housing stock conditions should
identify the number of units in need of repair
(rehabilitation) and replacement (demolition) .
where housing needs exist, the element should identify
potential solutions and resources to address the need.
B. Quantified Obiectives
Establish the ntaxirnunt number of housing units drat can be constnccted,
rehabilitated, and conserved by income category during the planning period of rhe
element (Section 65583 (c)(3)).
Chapter 889, Statutes of 1991, requires that quantified
objectives for new construction, rehabilitation, and
conservation now be estimated by income category (i. e. , very
low-, low-, moderate-, and above moderate-income) . This
information may be illustrated in chart form; for example:
QUANTIFIED OBJECTIVE
Income Level New Construction. Rehab Conservation
Very Low-Income
Low-Income
Moderate-Income
Above Moderate
4
While Table 7 summarizes the City's total housing production
objective for the planning period, the element does not
clearly establish the City's construction objectives for
each income group. while Table 9 is labeled "Projected
Housing Construction by Income Group" the text explaining
the table indicates that the figures represent housing
construction needs for each income group proportionate to
the allocation used in the RHNA plan, rather than the City' s
construction objective for each income group.
C. Programs
1. Identify adequate sites which will be made available through appropriate
zoning and development standards needed to facilitate and encourage the
development of a variety of housing types for all income groups, i»chZng
multifamily rental housing, factory-built housing, ntobilehotnes,. and emergency
shelters and transitiotutl housing. Wltere the inventory of sues does not identify
adequate sites to accommodate the need for all lwusehold income groups
pursuant to Settop 65584, the program shall provide for sufficient sites with
zoning that pennits owner-occupied and rental multifamily residential use by
right, bicluding density and development standards that could accommodate
and facilitate the feasibility of horsing for very low- and low-income
households. (Section 65583(c)(1)).
A development density of 25 or more units per acre is
typically needed to accommodate lower-income housing
needs (i.e. very low- and low-income households) . The
development densities of the City's R-.4 and certain
commercial zones (e.g. , C-R, C-C, MU) provide
appropriate opportunities for lower-income households .
However, from Table 14 , there does not appear to be
enough vacant sites available in these zones to
accommodate the City's total lower-income need for
2, 153 units.
A density of 10 or more units per acre is typically
needed to provide opportunities for moderate-income
households. The City's R-2 and R-3 zones appear
appropriate for accommodating this need. According to
Table 14, there appears to be sufficient vacant sites
to accommodate approximately 460 to 770 units (one- and
two-bedroom units) , compared with the total need for
11077 moderate-income units.
Table 14 does appear, however, to identify sufficient
sites to accommodate the City's total need, for above
moderate-income households. The R-1 zone contains
enough vacant land to accommodate a maximum of 1, 900
units, compared with the need for 1, 898 units.
5
Therefore, the element should include programs to
increase the availability of sites, which are
appropriately zoned, to accommodate the City' s lower-
and moderate-income housing needs.
2 . Address and, where legally possible, ren:oti,e govenrmental constraints to the
mabrtenance, Inprovement, or development of housing for all Income groups
(Secdbn 65553(c)(3)).
The City's Residential Growth Management ordinance
prevents the accommodation of additional residential
development commensurate with the City's assigned share
of the regional housing need (see item A-1, above) .
According to the element, the Ordinance 's one percent
annual growth allowance will allow the City to
accommodate 1, 185 additional units during the planning
period. The City estimates that approximately 190
additional units could also be accommodated through
replacement housing construction and by proposed
exemptions for affordable housing units. The City' s
projected housing need for the planning period (January
1991 through July 1997) , however, totals 5, 128 units.
Therefore, the Ordinance is serving as a governmental
constraint which should be removed or mitigated. For
example, the City could mitigate or remove the adverse
effects of the ordinance by annexing additional sites
in the expansion areas for residential development and
exempting development on these sites from the
ordinance. The City could also align the annual growth
allowance of the Ordinance with the housing .production
and population growth projections prepared for the City
by the San Luis Obispo Council of Governments (i. e. , an
annual growth rate approximating 5 percent) .
The City's proposed inclusionary housing requirements
(Program 1.22 . 11) also presents a potential
governmental constraint to the development of large-
scale residential projects and should be removed or
mitigated. As .structured, . the program would impose a
50 Percent--inclusionary requirement (i. e. , 33 percent
lower-income and 17 percent moderate-income) on
residential development projects of 50 or more units.
Unless much stronger financial incentives or regulatory
incentives are provided, the exceptionally high
inclusionary requirement proposed under this program is
likely to constrain the development of housing in the
expansion areas proposed for annexation.
6
The City should modify its inclusionary ordinance
and/or other development standards. For example, a 25`s
inclusionary requirement (with 15% lower-income and 10%
moderate-income) , combined with density bonus or other
development concessions would be less likely to
constrain residential development.
The existence of other potential or actual governmental
constraints, and the adequacy of City efforts to
mitigate them, cannot be determined in the absence of a.
complete discussion and determination of potential
constraints (see item A-31 above) .
3 . Programs should include specific ti:ntelines for implementation and Identify the
City department or itudiipidual responsible for implementation (Section 65583
(c))•
All of the City's programs lack this information.
4 . Most of the programs should include more specific implementation actions
and demonstrate a greater commitment toward implementation to einsure that
the City can meet housing element program requirements (Section 65583(c)(1-
6)).
All program descriptions should be as detailed as
Possible, specifying the objectives of the program,
funding sources and costs, and the steps to be taken by
the locality to implement the programs. Example,
include but are not limited to:
Program 1.22. 14 : When will the City adopt procedures
to expedite development permits?
What amount of reduction in average
processing time is expected? How
many projects or units are expected
to be assisted during the planning
period? what kinds of affordable
housing projects are eligible; does
it include development projects
subject to Program 1.22 . 11?
Program 1.23.7: When will• the airy establish 'a
housing rehabilitation program?
What amount of CDBG funding will be
allocated for this purpose? How
many units does the City expect to
assist during the planning period?
The evaluation of the previous housing element 's
programs (pages 59-61) indicates that the City was
unsuccessful in implementing many of the programs.
7
Several programs were not fully implemented or failed
to meet intended objectives (e.g. , programs 2, 41 51 s ,
and 11) . Many other programs (programs 13-32) are not
included in the evaluation and, therefore, it is not
possible to determine whether these programs were
successfully implemented. Development of strong
programs which clearly articulate the City's policies
and commitment to address local need and State law will
ensure that San Luis Obispo will be more successful
during the current planning period.
As you may know, Government Code Section 65400 requires
each city and county planning agency to provide an
annual report to its legislative body on the status of
the local general plan and the progress in its
implementation. Chapter 1441, Statutes of 1990 added
that this annual report must also include the
locality's progress in meeting its share of regional
housing needs (for each income group) determined
pursuant to Section 65584 . Chapter 889, Statutes of
1991 now requires that a copy of this report be
submitted to the Department of Housing and Community
Development within 30 days of its receipt by the local
legislative body.
The City should establish a system for monitoring the
City's progress in meeting its regional housing needs
and implementing housing element program actions. The
City's ability to effectively monitor program progress
during the planning period, and make appropriate
modifications, depends upon clear and measurable
program objectives. Therefore, the City should ensure
that its programs contain sufficient information to
make annual monitoring possible.
To assist the City in revising all of its programs, we
have enclosed excerpts of successful programs with
clear objectives and commitment from other localities.
We would also be happy to provide assistance to City
staff to facilitate program revisions.
5. hulude additional programs which assist the development of adequate housing
to meet the needs of low- and moderate-income households (Section 65583
(c)(2)), and conserve and improve the condition of the existing affordable
housing stock (Sectian 65583 (c)(4)).
Following clarification of the City's commitment to
implement proposed housing element programs and program
objectives (see items C-3 and C--4 above) , the City may
need to include additional programs to",assist the
development and conservation/rehabilitation of
affordable housing.
8
6. Include at? equal housing opportunity program (Section 65583 (c)(5)).
A local equal housing opportunity program should
provide some means for the resolution of housing
discrimination complaints and should be promoted
throughout the community. In smaller localities, this
may be limited to distributing information on fair .
housing laws, and referring complaints to the district
office of the State Department of Fair Employment and
Housing or other public or nonprofit agencies equipped
to handle housing discrimination complaints.
D. Preservation of Subsidized Housing
Pursuant to Chapter 1451, Statutes of 1989, expand the
analysis of assisted multifamily housing developments that
are eligible to change to non-low-income housing uses within
ten years of the housing element update (July 1, 1992) due
to termination of subsidy contracts, mortgage prepayment, or
expiration of use restrictions (Section 65583 (a) (8) ) .
1. Include a cost analysis of the following:
• The cost of preserving all of the project units at .
risk of losing affordability controls; and
• The cost of producing or replacing the units with
new rental housing with compatible unit size and
rent levels (Section 65583 (a) (8) (B) ) ,
Costs can be combined for all of the units at risk
within the planning period; detailed cost analysis or
project appraisals are not necessary. If it is not
possible to reliably estimate preservation costs, it is
permissible to describe whether such costs are
anticipated to be higher or lower than replacement
estimates, and the magnitude of the difference between
preservation and replacement costs.
2 Er and the analysis of financing sources which could be
• •P_._ . Y g
used to preserve units at risk of conversion during the
planning period. The analysis should identify the
amount of funding which could be made available from
the funding sources identified (i.e. , CDBG funds,
mortgage revenue bond proceeds, or the housing trust
fund) (Section 65583 (a) (8) (D) ) .
3 . Establish quantified objectives .-for the number of at-
risk units to be preserved during the planning period
of the element (Section 65583 (b) ) .
9
Ideally, preservation objectives will equal the number
of units at risk, however, the statute acknowledges
that when a locality has determined that the potential
preservation need exceeds available resources,
objectives may be less than anticipated needs. Under
these circumstances, the element should include the
analysis used to establish the maximum preservation
objective.
4 . Identify program actions for preserving units at risk
of conversion during the planning period. Program
actions should utilize the funding sources identified
in item D-2, above, except where the City has
identified other (more urgent) needs for these funding
sources (section 65583 (c) (6) ) .
The element should include programs which clearly
describe the specific actions or steps the City will
take to preserve at-risk projects, including timelines
and the funding sources to be used. Actions might
range from regulatory and technical assistance measures
to providing direct financial participation
(loans/grants for acquisition and rehabilitation) to
preserve the at-risk units. Program actions should be
appropriately tailored to the kinds of projects at risk
(e.g. , local versus federal projects) .
It is also appropriate to describe the City's
responsibility for reviewing plans of action submitted
for LIHPRHA-eligible projects and advising tenants of
available assistance (see pages 23-25 of the enclosed
technical assistance paper: Housing Element Analysis:
Preservation of Assisted Units.
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