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San Luis Obispo Housing Element, March 30,2004
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MISSION STATEMENT
Our mission is to identify and serve the needs of all people in a positive and
courteous manner and to help ensure that San Luis Obispo remains a
healthy, safe, attractive and enjoyable place to live, work or visit. We help
plan the City's form and character, support community values, preserve the
environment, promote the wise use of resources and protect public health
and safety.
OUR SERVICE PHILOSOPHY
The City of San Luis Obispo Community Development Department staff
provides high-quality service whenever and wherever you need it. We will:
• Listen to and understand your needs,
• Give clear, accurate and prompt answers to your questions,
• Explain how you can achieve your goals under the City's rules,
• Help resolve problems in an open, objective and fair manner,
• Maintain the highest ethical standards; and
• Work to continually improve our services.
San Luis Obispo Housing Element, March 30,2004
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city of san Us ompo
housinc element
Adopted on ,
San Luis Obispo City Council Resolution No. (2004 Series)
SAN LUIS OBISPO CITY COUNCIL
Dave Romero, Mayor John Ewan
Christine Mulholland Kenneth Schwartz, Vice Mayor
Allen Settle
PLANNING COMMISSION
Orval Osborne, Chair Jim Aiken
Michael Boswell James Caruso, Vice-Chair
Carlyn Christianson Allen Cooper
Alice Loh
COMMUNITY DEVELOPMENT DEPARTMENT
John Mandeville, Director
Michael Draze, Deputy Director, Long-Range Planning
Jeff Hook,Project Planner
Teri Bowen, Planning Intern
City of San Luis Obispo
990 Palm Street
P.O. Box 8100
San Luis Obispo, CA 93403 - 8100
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San Luis Obispo Housing Element,March 30,2004
City Council Resolution No.
(attach copy of Resolution)
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San Luis Obispo Housing Element,March 30,2004
State Housing and Community Development
(attach certification letter)
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San Luis Obispo Housing Element,March.30,2004
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This Housing Element has been prepared to help San Luis Obispo City residents secure safe
housing that will meet their personal needs and their financial circumstances, and to comply with
State law. This is the final version of the Element approved by the City Council after holding
seven public hearings during January, February and March of 2004. This "Final Draft"
incorporates changes made by the Council during its review and is based on the City Planning
Commission's Draft Housing Element. The Planning Commission approved a draft and
forwarded to the City Council for action following approximately four months of review and
eight public hearings. It also includes changes recommended by the Housing Element Update.
Task Force, a 17-member ad-hoc committee appointed by the City Council to provide diverse
input. As part of the required Housing Element update process and pursuant to State law, the.
adopted Housing Element has been forwarded to the State Department of Housing and
Community Development for review and certification.
The Housing Element is part of the City's General Plan and is one of 10 "elements" or chapters
of that plan. It sets out the City's goals, policies and programs for housing over the next five
years. It works in concert with the other plan elements to help achieve the broader community
goals as expressed in the General Plan Land Use Element. The other elements are Land Use,
Open Space, Circulation, Noise, Safety, Conservation, Energy Conservation, Parks and
Recreation, and Water and Wastewater. Under State law, the Housing Element must be updated
at least every five years. The City intends to update this Element by July 1, 2009.
To purchase additional copies of the Housing Element or other elements of the General Plan,
please contact the Community Development Department, City of San Luis Obispo, 990 Palm
Street, San Luis Obispo, California 93401-3249. Phone: (805) 781-7170. Fax: (805) 781-7173.
Web address: www.slocity.ors
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San Luis Obispo Housing Element, March 30,2004
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Page
FOREWORD.........................................................................................:........................ 6
1. INTRODUCTION....:::................................................................:...:.:..........13
1.10 Purpose.................................................................................................13
1.20 Citizen Participation.............................................................................14
1.30 Consistency with State Planning Law...............................................,....14
1.40 General Plan Consistency.....................................................................16
1.50 New in this Element..............................................................................16
1.60 Housing Element Organization.............................................................17
2. COMMUNITY FACTORS::.:.....................................................................19
2.10 Community Overview..............,..............................................................19
2.10.10 Demographic Snapshots..................................................................19
2.10.20 Housing Snapshots.........................;.................................................20
2.10.30 Neighborhood Snapshots.................................................................21
3. GOALS, POLICIES AND PROGRAMS........................::.........................23
3.10 Overview...............................................................................................23
3.20 Summary of New Programs..................................................................23
3.30 Goals, Policies and Programs.............................,.......,.......:................24
3.40 Implementation Tools............................................................................43
4. QUANTIFIED OBJECTIVES.....................::........:....................................47
4.10 Overview.................................................................................:.............47
4.20 New Housing Construction Completed.................................................47
4.30 New Housing Construction Objectives.................................................48
4.40 Preservation of At-Risk Units...............................................................48
4.50 Rehabilitation and Preservation Objectives.........................................49
4.60 Quantified Objectives Summar .....................50
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San Luis Obispo Housing Element, March 30,2004
LIST OF TABLES Page
1. State Housing Element Requirements .................................................................15
2. Inclusionary Housing Requirements....................................................................27
3. Resources/Incentives Available For Housing Activities......................................43
4. Housing Units Completed,January 2001 Through 2003.....................................47
5. New Housing Construction Objectives, January 2004 to July 2009....................48
6. Rehabilitation, Preservation, and Conservation Objectives.................................49
7. Quantified Objectives Summary,2001-2009.......................................................50
LIST OF FIGURES
1. Areas To Be Considered For Possible Rezoning ................................................35
appendices
APPENDIX A. COMMUNITY PROFILE.......................................:...:.....................52
1. POPULATION TRENDS AND CHARACTERISTICS
a. Age Composition
b. Race and Ethnicity
2. EMPLOYMENT TRENDS
3. HOUSEHOLD CHARACTERISTICS
a. Household Formation and Type
b. Household Income
4. HOUSING INVENTORYAND MARKET CONDITIONS
a. Housing Stock Profile and Population Growth
b. Unit Type
C. Unit Size
d. Tenure
e. Vacancy Rates
f. Age of Housing Stock
g. Housing Condition
h. Housing Costs and Rents
S. SUMMARYAND CONCLUSIONS
APPENDIX B. HOUSING NEEDS ............................................................................79
1. REGIONAL HOUSING NEEDS ASSESSMENT
a. Existing Housing Needs
b. Housing Needs For 2001-2009
2. SPECIAL HOUSING NEEDS
a. Elderly Persons
b. Large Families
C. Female-Headed Households
d. Disabled Persons
e. Homeless Persons
f. Farm Workers
g. Students
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San Luis Obispo Housing Element,March 30,2004
h. Fraternities and Sororities
i. "Shared"Households
3. CONCL USIONS
APPENDIX C. HOUSING CONSTRAINTS AND RESOURCES..........................97
1. GOVERNMENTAL CONSTRAINTS
a. Land Use Controls
b. Zoning Regulations and Development Standards
C. Specific Plans r
d. Residential Growth Management Regulations
e. Architectural Review
f. Building and Zoning Code Enforcement
g. Processing and Permit Procedures.
h. Development Fees
i. Infrastructure
I Public Services
k Schools
2. NON-GOVERNMENTAL CONSTRAINTS
a. Land Costs
b. Construction Costs
C. Availability and Cost of Financing
d. Insurance Costs
e. Design Expectations
f. Investment Expectations
3, REGIONAL HOUSING NEED ALLOCATIONAND QUANTIFIED OBJECTIVES
a. Residential Growth Implications ofAcheiving Quantified Objectives
b. Water Supply Constraints
C. Land Resources and Development Rate
APPENDIX D. RESIDENTIAL LAND RESOURCES .............................................133
1. A VAILABILITY OF SITES FOR HOUSING
a. Vacant Residential Land
b. Underutilized Residential Land
C. Vacant or Underutilized Land Suitable for Mixed-Use Development
d. Vacant or Underutilized Land Designated as Interim Open Space
e. Vacant or Underutilized Land Outside City Limits, Within the Urban
Reserve, Including Major Expansion Areas
2. EVALUATION OF RESIDENTIAL DEVELOPMENT CAPACITY
APPENDIX E. REVIEW OF THE 1994 HOUSING ELEMENT RESULTS........141
1. PROGRESS IN IMPLEMENTING THE 1994 GOALS AND OBJECTIVES
APPENDIX F. FIVE-YEAR IMPLEMENTATION PLAN .....................................154
APPENDIX G. HOUSING TASK FORCE RECOMMENDATIONS....................155
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San Luis Obispo Housing Element,March 30,2004
APPENDIX H. SUMMARY OF PUBLIC COMMENTS ON THE DRAFT..........174
HOUSING ELEMENT
APPENDIX I. GENERAL PLAN CONSISTENCY ANALYSIS ............................175
APPENDIX J. PUBLIC DISTRIBUTION LIST ......................................................189
APPENDIX K. HOUSING RESOURCES AND OUTREACH INFORMATION 190
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APPENDIXL. REFERENCES..............................................................:....................192
APPENDIXM. GLOSSARY.......................:..:.......................................:....................195
APPENDIX
LIST OF TABLES
A-1. Population Growth, 1980-2000...........................................................................53
A-2. Population Projections, 2001-2008.....................................................................54
A-3. Age Distribution, 2000...................................................................................,.....55
A-4. Pre-Primary School Enrollment, 1990 and 2000.........................................:......55
A-5. Racial and Ethnic Composition, 2000...................................................:........:....56
A-6. Projected Change in Racial and Ethnic Composition by Percent, 2001-2010....56
A-7. Occupations, San Luis Obispo City, County and California, 2000.....................57
A-8. Number of Households, 1990-2000.....................................................................59
A-9. Household Size, 1990-2000...............................................................................59
A-10. Households by Type, Percent of Total Households, 1990-2000.,........................60
A-11. Median Household and Family Incomes, 1989 and 1999...................................61
A-12. Per Capita Incomes, 1989 and 1999, San Luis Obispo City, County
andCalifornia......................................................................................................62
A-13. State Income Categories......................................................................................62
A-14. Households by State Income Category, 1999......................................................63
A-15. Households Below Poverty Level by Household Type, 1999...............................63
A-16. Residential Development, 1995-2002..................................................................66
A-17. Composition of Housing Stock by Unit Type, 1990 and 2000.............................67
A-18. Number of Bedrooms by Tenure, 2000................................................................68
A-19. Age of Housing Stock by Tenure, 2000................................................................69
A-20. Single Family House Values, 2000......................................................................71
A-21. Median Monthly Owner Cost and Median Gross Rent as a Percentage
of Household Income, 1999................................................................................. 73
A-22. Dwelling Units by Rent Costs and Number of Bedrooms, 2000.......................... 73
A-23. Range and Average Rent Costs, July 2003..........................................................74
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San Luis Obispo Housing Element, March 30,2004
APPENDIX
LIST OF TABLES
A-24. Comparison of Housing Costs as a Percentage of Gross Monthly
Income, 1989 and 1999...............................:........................................................75
A-25. Maximum Affordable Rent and.Purchase Price, by Income Category,
July2003.................................................................................... ..........................76
B-1. Residential Overcrowding, San.Luis Obispo City, County and California,
2000.............:............................................................................:..........................81
B-2. Average Household Size by Tenure, San Luis Obispo City, County and
California, 2000...................................................................................................82
B-3. Regional Housing Needs Allocation Plan for the County of San Luis Obispo,
January2001 -July 2009....................................................................................83
B-4. Elderly Mobility and Disability Status, 2000.......................................................84
B-5. Special Needs Housing and Residential Care Facilities, 2003...........................86
B-6. Large Households by Tenure, 2000.....................................................................87
B-7. Female-Headed Households, 2000......................................................................88
B-8. Persons Reporting Mobility or Self-Care Limitations, 2000...............................89
B-9. Summary of Housing Needs..................................................................................95
C-1. Land Use Categories Allowing Residential Uses....................................:...........98
C-2. Summary of Residential Development Standards, 2003.......................................100
C-3. Selected Flexible Residential Development Standards, 2003.............................. 101
C-4. Estimated Housing Capacity in Expansion Areas, 2003.....................................104
C-5. Major Expansion Areas Phasing Plan, 2002.......................................................107
C-6. Code Enforcement Cases, 2001...........................................................................112
C-7. Comparative Development Fee Summary, 2003.................................:................117
C-8. Residential Development Impact Fees Per Dwelling Unit, July 2003.................120
C-9. Water Available For Residential Development, 2003 .........................................121
C-10. Possible New Water Sources, 2002-2022 ........................................:...::............122
C-I1. Regional Housing Need Allocation and Quantified Objectives, January
2001 -July 2009..................................................................................................127
C-12. Maximum Residential Development Potential Based on Anticipated
Water Supplies, January 2003-July 2009..........................................................129
C-13. Population Change, 1977-2002........................................................................132
D-1. Vacant and Underutilized Land in City by Zone, June 2003...............................134
D-2. Potential Number of Dwellings by Bedroom.......................................................134
D-3. Vacant and Underutilized Land in the Urban Reserve, by Sub-Area,
June2003.............................................................................................................137
D-4. Summary of Housing Development Potential, 2001 -2022................................139
E-1. Housing Element Evaluation, 1994-2001 .........................................................141
E-2. Progress in Achieving Housing Element Qualified Objectives, 1994-2001 .....152
1-1. General Plan Consistency Evaluation Matrix.....................................................175
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San Luis Obispo Housing Element,March 30,2004
APPENDIX
LIST OF FIGURES
A-1. Housing and Population Growth, 1980-2010...................................................... 65
C-1. Major Expansion Areas, 2003.............................................................................105
C-2. General Plan Anticipated Housing and Population Growth...............................106
C-3. Comparison of Development Fees for a 2,000 Square-Foot, Single-
FamilyHouse, 2003.............................................................................................119
C-4. Residential Construction, 1955— 1999................................................................131
D-1. Residential Development Capacity by Zone, in Density Units............................136
D-2. Residential Development Capacity, by Dwelling Units, 2003.............................138
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San Luis Obispo Housing Element,March 30,2004
chapteRl
intuoauction
1.10 Purpose
The City has prepared this document to help its citizen's secure adequate and affordable housing,
and to meet State law. In addition, this Housing Element update has the following basic
objectives:
• To evaluate and quantify community housing needs, constraints and available resources
to effectively satisfy those needs;
• To increase public awareness and understanding of the City's housing situation and its
goals to encourage public participation in addressing those housing needs;
• To provide a comprehensive document that includes goals, policies and programs to help
guide community efforts to meet housing needs through informed decision-making on
land use and housing choices;
• To help develop more affordable housing; and a wider variety of housing, to meet the
City's housing needs for the current planning period which runs from January 1, 2001 to
July 1, 2009;
• To track and document the effectiveness of City programs in meeting housing needs, and
to evaluate opportunities for improving those programs;
• To enable the City to secure financial assistance for the construction of affordable
housing for very low-, low- and moderate-income persons;
Under State law, cities are responsible for planning for the well being of their citizens. This
Housing Element is the City's strategy for meeting the housing needs of its citizens, for
preserying and enhancing neighborhoods, and for increasing affordable housing opportunities for
very-low, low and moderate income people. It is the primary policy guide for local decision-
making on all housing matters. Housing consumers, property owners, developers, elected
officials, planners and others in the City will use this Element to help make important personal,
financial and business decisions that will have community-wide impact. The Housing Element
also describes the City's demographic, economic and housing stock as required by State law.
Last, it sets forth the goals, strategies, policies and detailed programs necessary to address
projected housing needs.
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San Luis Obispo Housing Element, March 30,2004
1.20 Citizen Participation
The Housing Element expresses the community's housing priorities, goals, values and hopes for
the future. Preparing the Element is a sizable task that involves extensive community input and
the work of many individuals. Under State law, local governments must be diligent in soliciting
participation by all segments of the community in this effort. During preparation of this Element
Update, citizen participation was actively encouraged through the following forums:
• Eight public hearings before the Planning Commission and seven public hearings before
the City Council;
• Eighteen Housing Element Update Task Force meetings held over a seven month period;
• City website;
• Public notices in local newspapers.
Appendix K provides additional details regarding community outreach efforts.
130 Consistency with State Planning Law
California cities and counties must prepare housing elements as required by State law set forth in
Sections 65580 to 65589.8 of the California Government Code. The law mandates that housing
elements include "an identification and analysis of existing and projected housing needs and a
Statement of goals, policies, quantified objectives and scheduled programs for the preservation,
improvement and development of housing." This Element fulfills that requirement and provides
a detailed strategy for implementing the City's housing goals through 2009.
State housing goals rely on the effective implementation of housing policies at the local level --
policies found primarily in local housing elements. .To ensure local housing policies are
consistent with State law, the State Department of Housing and Community Development(HCD)
reviews local housing elements and reports its written findings to the local government. The
housing element must also be consistent with the other general plan elements and must address
several specific requirements regarding the element's scope and content. Table 1 summarizes
State requirements and identifies the applicable sections of the City of San Luis Obispo Housing
Element where these requirements are addressed.
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San Luis Obispo Housing Element, March 30,2004
constraints to housing maintenance, improvement and development.
4. Identify programs to conserve and improve San Luis Obispo's existing p. 23 -43
and affordable housing stock
5. Promote housing opportunities for all persons. p. 23 - 43
6. Identify programs to address the potential conversion of assisted p. 48
housing developments to market rate units
1.40 General Plan Consistency
The Housing Element is one part of the City of San Luis Obispo General Plan. State law requires
that general plans contain an integrated and internally consistent set of goals or policies.
Although the Housing Element. is the primary source of information on housing policies,
programs and resources, other General Plan documents also address or affect housing. By law,
new development projects must be consistent with all elements of the General Plan.
For example, the Land Use Element and Circulation Element set the City's policies for land use
and transportation, which in turn, affect how, when and where the City's housing needs can best
be met. While housing is important, it is but one of many community goals the General Plan
addresses. The other elements contain policies that seek to preserve and enhance the quality of
life San Luis Obispo citizens enjoy. Clean air and water, open space, parks and recreation,
preservation of natural, historic and cultural resources, public services and safety are also
essential qualities of the community. These policies are of equal importance with those of the
Housing Element.
This Element has been reviewed and determined to be consistent with the City's other General
Plan elements, and the policies and programs in the Housing Element reflect policies and
programs contained in other parts of the General Plan. Appendix I includes that evaluation. As
other elements,are updated or amended, the Housing Element will be reviewed to ensure general
plan consistency is maintained.
1.50 New in This Element
In 2004, San Luis Obispo faces a more challenging housing environment than the one that shaped
the previous Housing Element. Significant changes, both in California's economy and in State
housing laws, have raised public awareness and concerns about the need for more affordable
housing. Changes to State law also have expanded the scope and complexity of housing
elements. And while efforts have been made to adhere to the previous Element's goals, policies
and programs where possible, this update contains new policies and programs to address these
changes. The updated element also has a new format designed to make it simpler and easier to
use. The updated Element includes the following sections in response to new legal requirements:
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San Luis Obispo Housing Element, March 30,2004
Table 1
State Housing Element Re uirements
} - Regwred Hoasing Elemeni- Co`mponent a r, Reference
A. Housing Needs Assessment Page 79
1. Analysis of population trends in relation to countywide trends P. 52
2. Analysis of employment trends in relation to regional trends P. 57
3. Projection and quantification of existing and projected housing needs P. 50
for all income groups
4. Analysis and documentation of housing characteristics, including:
a)housing costs in relation to incomes; P. 71
b) residential overcrowding; P. 80
c) housing stock condition P. 70
5. Inventory of land suitable for residential development, including vacant P. 133
and underutilized sites having development potential, and analysis of
constraints to development of these sites.
6. Analysis of existing and potential government constraints on the P. 97
maintenance, improvement or development of housing for all income
levels.
7. Analysis of existing and potential non-governmental and market P. 123
constraints on maintenance, improvement or development of housing for
all income groups.
8. Analysis of special housing needs: disabled persons, elderly, large P. 84
families, female-headed households, farm workers.
9. Analysis of the needs of homeless individuals and families. P. 90
10. Analysis of opportunities for energy conservation with respect to P. 99
residential development.
B. Goals and Policies
1. Identification of San Luis Obispo's housing goals, quantified-objectives p. 47
and policies regarding housing maintenance, improvement and
development.
C. Implementation Program
1. Identify adequate sites that will be made available through appropriate p. 133
action with required public services and facilities for a variety of
housing es and for all income levels.
2. Program to assist in the development of adequate housing for low- and p. 23 —43
moderate-income households.
3. Identify, and when appropriate and possible, remove governmental p. 97; p.23 -43
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San Luis Obispo Housing Element, March 30,2004
• Analysis of constraints on housing for persons with disabilities (Ch. 671, Statutes of
2001)
• Programs to remove constraints or accommodate housing for persons with disabilities
(Ch. 671, Statutes of 2001)
• Programs addressing secondary dwelling units (Ch. 1062, Statutes of 2002)
• Policies regarding changes to residential density (Ch. 706, Statutes of 2002)
• Provisions to provide flexibility in identifying adequate sites(Ch. 796, Statutes of 1998)
In addition, the Appendices include several new sections on community outreach, a glossary,
identification of residential land resources, and housing references to assist those seeking to plan,
build, buy or rent housing in San Luis Obispo.
The Housing Element will be updated by July 2009. Citizens, the Planning Commission or the
City Council may propose up to four amendments to the Element each year, and those changes
may be adopted by the City Council after public hearings are held. For more up-to-date or
detailed information concerning population, housing, land use and development review in San
Luis Obispo, please contact the Community Development Department at City Hall, 990 Palm
Street (P.O. Box 8100), San Luis Obispo, CA 93401-3249, phone (805) 781-7170, or access the
City website @ 1vww.S10Citv.0rZ
1.60 Housing Element Organization
The Housing Element is organized into four chapters: Introduction, Community Factors, Goals,
Policies and Programs, and Quantified Objectives. These chapters summarize the demographic,
physical; economic, environmental and cultural factors that shape San Luis Obispo's housing
needs, and provide the policy and program map the City will follow to meet its housing needs.
Given the detailed and lengthy analysis involved in the preparation of the Housing Element,
supporting background material has been included as appendices. Appendices are not adopted
general plan policy. The appendices provide comprehensive information used to develop the
Housing Element, and contain supplementary information on housing, land resources,
development constraints and other relevent data. These appendices are:
• Community Profile (Appendix A)
• Housing Needs (Appendix B)
• Housing Constraints and Resources (Appendix C)
• Residential Land Resources (Appendix D)
• Review of the 1994 Housing Element Results (Appendix E)
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San Luis Obispo Housing Element,March 30,2004
• Five-Year Implementation Plan (Appendix F)
• Housing Task Force Recommendations (Appendix G)
• Summary of Public Comments on the Draft Housing Element (Appendix H)
• General Plan Consistency Analysis (Appendix I)
• Public Distribution List (Appendix J)
• Housing Resources and Outreach Information (Appendix K)
• References (Appendix L)
• Glossary (Appendix M)
Pursuant to the California Environmental Quality Act; an assessment of potential environmental
impacts resulting from the Housing Element also has been prepared and is available separately
from the Community Development Department.
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San Luis Obispo Housing Element, March 30, 2004
chaptCR 2
community factous
2.10 Community Overview
San Luis Obispo is a compact urban community blessed with rich ethnic, cultural and historical
traditions. Its namesake, Mission San Luis Obispo de Tolosa, founded in 1772, stands as the
community's physical, cultural and spiritual center. With an estimated population in 2003 of
44,359 people, San Luis Obispo is the largest city in terms of population in San Luis Obispo
County and serves as the County seat. Situated in a valley and framed by rolling hills, the City's
setting and visual character are distinctive. The "morros", a series of extinct volcanoes that
transect the city, produce a dramatic backdrop and create the City's unique skyline. San Luis
Obispo is home to California State Polytechnic University, Cuesta College and Camp San Luis
Obispo (California Army National Guard), and is the retail, business, governmental, and
transportation hub of the County.
In assessing the City's housing issues and needs, many factors were considered. These factors
became the foundation for the Element's preliminary goals, policies and programs. Preliminary
housing goals and policies were then refined through the public review process. An overview of
these factors is described below, including snapshots of the City's key demographic, economic
and housing characteristics. A detailed analysis of community factors is provided in Appendix
A.
2.10.10 Demographic Snapshots
❑ San Luis Obispo has grown at a slow, steady pace since 1980. Looking back over the last
23 years, the City has grown at an average rate of one percent per year, with periods of
faster or slower growth reflecting national and statewide economic cycles. For example,
in the late 1980s and early 1990s, the City grew at an annual average rate of two percent.
This was followed by a much slower rate of growth in the 1990s. Between 1990 and
1999, the City grew at annual average of only 0.3 percent, well below the General Plan's
one percent growth target. In the new millennium, the city has grown at an annual
average rate of 1.3 percent.
❑ When compared with California, the most ethnically diverse state in the nation, the City
and County of San Luis Obispo are not as ethnically diverse. The 2000 Census found that
over 84 percent of the City is white, about five percent is Asian, with much smaller
percentages of Native Americans, Pacific Islanders, other single races or persons self-
identifying with two or more races. Persons of Hispanic or Latino origin are classified
separately under the 2000 Census and can be of any race. About 12 percent of the City's
population is Hispanic, compared with 16 and 33 percent in the County and State,
respectively.
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San Luis Obispo Housing Element,March 30,2004
❑ Many segments of the City's population have difficulty finding affordable housing due to
their economic, physical or sociological circumstances. These special needs groups may
include the elderly, families, single parent households, people with disabilities, very low
and low-income residents, and the homeless.
❑ In 1999, City households earned less, on the average, than their county and State
counterparts. The median household income (including both family and non-family
households) was $31,926, compared with $42,428 for the County and $47,493 Statewide.
This reflects the high percentage of student households in San Luis Obispo. Many
students attending California State Polytechnic University (Cal Poly) and Cuesta College
are nominally classified as lower income, although often bring significant financial
resources through parental support.
❑ While median City household incomes were less than many other areas of coastal
California, median City housing costs were higher than both the county and State.
Housing costs in San Luis Obispo have risen sharply in recent years while average
household incomes have risen slowly or remained steady. A growing disparity between
household income and housing costs is forcing many to seek housing outside the City of
San Luis Obispo.
San Luis Obispo contains the largest concentration of jobs in the County. During
workdays, the City's population increases to an estimated 70,000 persons.
2.10.20 Housing Snapshots
❑ City housing costs have risen dramatically since 1994. Housing cost increases have
outpaced household income increases. As a result, in 2003 only about 23 percent of San
Luis Obispo residents can afford to buy a median-priced home based on their income
alone.
❑ Slightly more city residents rent than own housing. Rental housing costs also have
increased, although not as dramatically as for sale housing.
❑ In the last decade, the rate of housing production in San Luis Obispo slightly exceeded
the rate of population growth. Between 1990 and 2000, the City added about 2,200
residents — an increase of just over five percent. During the same period, the City's
housing stock grew by about 1,400 units—an increase of about eight percent.
❑ San Luis Obispo's housing market is strongly influenced by Cal Poly and Cuesta College
enrollment. At Cal Poly, on-campus student housing is very limited, and is non-existent
at Cuesta College. Most of the area's students live oft'campus, in single family or multi-
family rental units in the City of San Luis Obispo. Under City zoning regulations, up to
five adult students can live together in a house and share rental costs. Consequently,
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San Luis Obispo Housing Element,March 30,2004
college students can often out-compete non-student households for rental housing in areas
that were historically single-family residential neighborhoods.
❑ Just over three quarters of the City's housing stock was built before 1980. Despite its
age, the City's housing stock is generally in fair to good condition, with little outward
evidence of substandard or blighted conditions. In recent years, illegal garage
conversions and "bootleg" second units in low- and medium-density residential
neighborhoods, lack of property maintenance, noise and parking have been the focus of
citizen complaints and city code enforcement actions.
❑ While San Luis Obispo City appears mostly "built out", significant areas of developable
land remain that could help meet existing and future housing needs. A land inventory
conducted by the City in 2003 indicated that within city Eli its, there were about 180 acres
of vacant land, plus about 250 acres of"underutilized" land with additional development
potential. Outside the existing city limits but within the City's Urban Reserve, there were
about 124 acres of vacant land, about 12 acres of underutilized land, plus 641 acres in two
residential expansion areas: the Margarita and Orcutt Specific Plan Areas. In 2003, draft
specific plans for these expansion areas indicate there is a total development potential of
about 1,850 dwellings.
2.1030 Neighborhood Snapshots
❑ Code enforcement, neighborhood compatibility and property maintenance complaints in
low- and medium-density residential neighborhoods have increased dramatically in recent
years. Since 1994, Complaints received by the Community Development Department
regarding building and zoning code violations, garage conversions, substandard housing,
high-occupancy residential uses, fence height, trailers, noise disturbances, parking and
land use violations have grown by 51 percent. In 2000, the Office of Neighborhood
Services was established as part of the Police Department to address primarily parking
and property maintenance issues. Since 2000, the ONS has issued over 1,850 citations
for property maintenance/neighborhood enhancement violations, and over 8,700 citations
for noise ordinance violations.
❑ San Luis Obispo became a city in 1856. It has evolved from a small rural village of just
over 2,200 people in 1880 to a vibrant "metropolitan" area of over 44,000 residents in
2003. Its diverse neighborhoods reflect that evolution in terms of land use, population
density, street width and appearance, applicable development codes and architectural
style. The oldest neighborhoods are close to the downtown area, roughly bordered by
State Highway 101, the railroad tracks and High Street. The newest neighborhoods are in
the south and southwest areas of the City.
❑ San Luis Obispo has a strong"sense of place." It began with the founding of Mission San
Luis Obispo De Tolosa in 1772, and before that, was home to a large Chumash village,
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San Luis Obispo Housing Element, March 30,2004
attracted to the area due to its mild climate and abundant resources. San Luis Obispo has
been shaped by persons of many backgrounds, including: Native Americans, Spanish,
Mexican, Chinese, English, French, German, Irish, Portuguese, Swiss-Italian, Japanese,
Filipino, and many others. The community takes pride in its rich, multi-ethnic and multi-
cultural heritage, and its many historic homes and commercial buildings. Architectural
and historic preservation are important considerations in many neighborhoods.
o San Luis Obispo's neighborhoods traditionally have been made up mostly of single-
family housing. Low-density, detached single-family housing is still the City's
predominant residential land use by land area. Of the roughly nine square miles of zoned
land, about 28 percent is zoned for low-density residential development. By contrast,
about 14 percent is zoned for multi-family residential use (Medium, Medium-High, and
High density residential uses).
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San Luis Obispo Housing Element, March 30,2004
chapteR 3
Goals, policies ana puocRams
3.10 Overview
This chapter of the Housing Element includes the City's Housing Implementation Plan for the
period January 2001 to July 2009. The following goals, policies and programs are based on an
assessment of the City's needs, opportunities and constraints; an evaluation of its existing
policies and programs; and community input from the Housing Element Update Task Force,
community groups, public hearings, workshops and correspondence.
3.20 Summary of New Programs
Higher housing costs, population growth, and the State's economic recession are making it far
more difficult for many households to meet their housing needs today than in the mid-1990s.
Consequently, San Luis Obispo's housing strategy has expanded to meet those needs by:
• Exempting housing affordable to moderate income households, and housing in the
Downtown Core. from Residential Growth Management Regulations.
• Providing incentives to encourage developers to build more affordable compact rental
and ownership housing.
• Initiating rezoning of several areas suitable for higher density, infill housing.
• Establishing a "First-time Homebuyers Program" to assist low-and moderate-income
households in purchasing a home.
• Using a combination of State and Federal grants, affordable housing funds, density
bonuses and other incentives, accommodate development of 4,087 dwellings during
the planning period from January 1, 2001 to July 1, 2009.
• Amending the City's Affordable Housing Standards to lower rent levels for dwellings
intended to be affordable for moderate-income households and individuals.
• Using Section 108 Federal guaranteed loan funds and other funding sources, initiate
development of a major downtown mixed-use project with both affordable and .
market-rate housing.
• Requiring most new multi-story buildings in the Downtown Core to provide housing
above the ground floor.
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San Luis Obispo Housing Element,March 30,2004
• Providing special incentives to encourage downtown residential development, and
instituting more flexible parking requirements for specified housing developments
where alternative parking/transportation strategies exist.
• Seeking new funding sources to help defray City development review and impact fees
for developers of very low-, low- and moderate-income housing.
• Reducing obstacles to the production of small residential projects by exempting the
construction, remodeling or relocation of most developments of four dwellings or less
from Architectural Review Commission review.
• Promoting mixed-use development, infill residential development, and more compact,
higher density housing where appropriate.
This strategy combines requirements and incentives to increase production of both affordable and
market-rate housing over the next four and a half years.
Like many small cities with only limited public funds for housing, the City has relied on the
private sector to meet a portion of its affordable housing needs. Increasingly, local governments
are finding it necessary to assist developers if adequate housing is to be built at prices that
citizens can afford. Across the U.S., it has become apparent that the most effective programs
involve cooperative public/private efforts to produce affordable housing. This requires that the
City take a more active role in planning, funding and promoting affordable housing than has been
its practice. This Housing Element update builds upon programs introduced in 1994 to promote
affordable housing and expands incentives for affordable housing construction. For example,
using Community Development Block Grant funds, the City has established a Housing Programs
Specialist position to actively support affordable housing by soliciting grants, loans, and other
forms of assistance.
3.30 Goals, Policies and Programs
This chapter describes the City's housing goals, policies and programs, which together form the
blueprint for housing actions during the seven and one-half year period covered by this Element.
Goals, policies and programs are listed in top-to-bottom order, with goals at the top and being the
most general Statements, working down to programs, the most specific Statements of intent.
Here is how the three levels of policy differ:
o Goals are the desired results that the City will attempt to reach over the long tern. They are
general expressions of community values or preferred end states, and therefore, are abstract in
nature and are rarely fully attained. While it may not be possible to attain all goals during
this Element's planning period, they will, nonetheless, be the basis for City policies and
actions during this period.
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San Luis Obispo Housing Element,March 30,2004
❑ Policies are specific statements that will guide decision-making. Policies serve as the
directives to designers, decision makers and others who will initiate or review new
development projects. Some policies stand alone as directives, but others require that
additional actions be taken. These additional actions are listed under "programs" below.
Most policies have a time frame that fits within this Element's planning period. In this
context, "shall" means the policy is mandatory; "should" or"will" indicate the policy should
be followed unless there are compelling or contradictory reasons to do otherwise.
❑ Programs are the core of the City's housing strategy. These include on-going programs,
procedural changes, general plan changes, rezonings or other actions that help achieve
housing goals. Programs translate goals and policies into actions.
Goal 1.1 Safety. Providing safe, decent shelter for all residents.
1.2 Policies
1.2.1 Assist those citizens unable to obtain safe shelter on their own.
1.2.2 Support and inform the public about fair housing laws and programs that allow equal
housing access for all city residents.
1.2.3 Maintain a level of housing code enforcement sufficient to correct unsafe, unsanitary
or illegal conditions and to preserve the inventory of safe housing.
1.3 Programs
1.3.1 Provide financial assistance to very-low, low- and moderate-income homeowners and
renters for the rehabilitation of approximately 45 rental housing units and 45 single-
family or mobile home units using Federal, State and local housing funds, such as
Community Development Block Grant Funds.
1.3.2 Continue code enforcement to expedite the removal of illegal or unsafe dwellings, to
eliminate hazardous site or property conditions, and resolve chronic building safety
problems.
1.3.3 Enact a Rental Inspection Program to improve the condition of the City's housing
stock.
1:3.4 Continue to support local and regional solutions to homelessness by funding
programs such as the SLO Homeless Shelter and Prado Day Center for Homeless
Persons.
1.3.5 Create an educational campaign for owners of older residences informing them of
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San Luis Obispo Housing Element,March 30,2004
ways to reduce the seismic hazards commonly found in such structures, and
encouraging them to undertake seismic upgrades.
Goal 2.1 Affordability. Accommodate affordable housing production that helps meet the
City's Quantified Objectives.
2.2 Policies
2.2.1 Income Levels For Affordable Housing. For purposes of this Housing Element,
affordable housing is that which is obtainable by a household with a particular
income level, as further described in the City's Affordable Housing Standards.
Housing affordable to Very-low, Low, and Moderate-income persons or households
shall be considered "affordable housing." Income levels are defined as follows:
Very low: 50% or less of County median household income.
Low: 51% to 80% of County median household income.
Moderate: 81%to 120%of County median household income.
Above moderate: 121%or more of County median household income.
2.2.2 Index of Affordability. The Index of Affordability shall be whether the monthly
cost of housing fits within the following limits:
❑ For very low-and low-income households, not more than 25% of monthly income.
❑ For moderate-income households, not more than 30%of monthly income.
❑ For above-moderate income households; no index.
These indices may be modified or expanded if the State of California modifies or
expands its definition of affordability for these income groups.
2.2.3 For housing to qualify as "affordable" under the provisions of this Element, guarantees
must be presented that ownership or rental housing units will remain affordable for the
longest period allowed by State law, or for a shorter period under an equity-sharing or
rehabilitation agreement with the City.
2.2.4 Encourage housing production for all financial strata of the City's population, in the
proportions shown in the Regional Housing Needs Allocation, for the 2001 — 2009
planning period. These proportions are: very low income, 34 %; low income, 19 %;
moderate income, 20 %; above moderate income, 27%.
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San Luis Obispo Housing Element,March 30,2004
2.3 Programs
2.3.1 Amend the Inclusionary Housing Regulations to require that new residential
subdivisions and residential development projects meet the inclusionary requirement
by: 1) building the required affordable housing on- or off-site, 2) dedicating real
property, or 3) rehabilitating units with guarantees the units remain affordable,
pursuant to the Affordable Housing Standards, as shown in Tables 2 and 2A, and as
further described in the Inclusionary Housing Ordinance.
Table 2
Inclusionary Housing Requirement
Type of Development Project'
Residential- Adjust base requirement per Table 2A Commercial
Build 3% low or 5% moderate income Affordable Build 2 ADUs per acre, but not less
Dwelling Units (ADUs2), but not less than 1 ADU than 1 ADU per project;
E per project;
ora Or
U pay in-lieu fee equal to 5% of building valuation.°
pay in-lieu fee equal to 5% of
building valuation.
° Build 5% low- and 10% moderate income ADUs, but Build.2 ADUs per acre, but not less
not less than 1 ADU per project; than 1 ADU per project;
c
° or or
pay in-lieu fee equal to 15% of building valuation. pay in-lieu fee equal to 5% of
building valuation.
'Residential developments of four or less dwellings, and commercial developments of 2,500 gross square feet of
floor area or less are exempt from these requirements.
'Affordable Dwelling Units must meet City affordability criteria listed in Goal 2.1.
;Developer may build affordable housing in the required amounts, pay in-lieu fee based on the above formula, or
dedicate real property, or a combination of these, to City approval.
'"Building valuation" shall mean the total value of all construction work for which a permit would be issued, as
determined by the Chief Building Official using the Uniform Building Code.
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San Luis Obispo Housing Element,March 30,2004
TABLE 2A
Project Inclusionary Housing Requirement
Density Adjustment Factor2
(Density
Units/Net Average Unit Size(sq. ft.)
Acre)' Up to 1,101-1,500 1,501-2000 2,001-2,500 2,501- >3,000
1,100 3,000
36 or more 0 0 .75 1 1.25 1.5
24-35.99 0 0 .75 1.25 1.25 1.5
12-23.99 0 .25 1 1.25 1.5 1.75
7-11.99 0 .5 1 1.5 1.5 1.75
<7 0 .5 1.25 1.5 1.75 2
Including allowed density bonus,where applicable.
ZMultiply the total base Inclusionary Housing Requirement(either housing or in-lieu percentage) by the adjustment
factor to determine requirement. At least one enforceably-restricted affordable unit is required per development of
five or more units.
2.3.2 Maintain a city housing fund to be used to develop affordable housing units and
acquire land for affordable housing projects. To qualify for such public assistance,
the development of affordable units must include guarantees the units will remain
affordable for the longest period allowed by State law. Inclusionary housing in-lieu
fees will be placed into this fund.
2.3.3 Review existing and proposed building and planning policies regulations to determine
whether there are changes possible that could assist the production of affordable
housing but that do not conflict with other General Plan policies. Such periodic
reviews will seek to remove regulations that are no longer needed.
2.3.4 Adopt permit streamlining procedures to speed up the processing of applications and
construction permits for affordable housing projects. City staff and commissions
should give such projects priority in allocating work assignments, scheduling,
conferences and hearings, and in preparing and issuing reports.
2.3.5 Review and revise existing and proposed building and planning policies and
regulations to encourage "green building technology", and to allow construction of
personalized, unconventional housing types that reduce cost and/or energy and
materials consumption relative to conventional construction, provided that residential
quality and safety can be maintained. .
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San Luis Obispo Housing Element,March 30,2004
2.3.6 Pursue outside funding sources for the payment of City impact fees so that new
dwellings that meet the City's affordable housing standards can mitigate their facility
and service impacts without adversely affecting housing affordability.
2.3.7 To the extent outside funding sources can be identified to offset impacts on City
funds, exempt dwellings that meet the moderate income, Affordable Housing
Standards from planning, building and engineering development review and permit
fees, including water meter installation fee. Retain current exemptions for very-low
and low-income households.
2.3.8 Help coordinate public and private sector actions to encourage the development of
housing that meets the City's housing needs.
2.3.9 Assist with the issuance of bonds, tax credit financing, loan underwriting or other
financial tools to help develop or preserve affordable units through various programs,
including, but not limited to: (1) below-market financing and (2) subsidized
mortgages for very-low, low- and moderate-income persons and first-time home
buyers, and (3) self-help or"sweat equity"homeowner housing.
2.3.10 Amend Affordable Housing Standards to modify the method for calculating
maximum moderate-income rental costs, so that moderate-income rents are .
proportionately consistent with rental costs for very low- and low-income renters, to
the extent allowed by State and Federal law.
2.3.11 In conjunction with the Housing Authority and other local housing agencies, provide
on-going technical assistance and education to tenants, property owners and the
community at large on the need to preserve at-risk units as well as the available tools
to help them do so.
Goal 3.1 Housing Conservation. Conserve existing housing and prevent the loss of safe
housing and the displacement of current occupants.
3.2 Policies
3.2.1 Encourage the rehabilitation, remodeling or relocation of sound or rehabitateable
housing rather than demolition. Demolition of non-historic housing may be permitted
where conservation of existing housing would preclude the achievement of other
housing objectives or adopted City goals.
3.2.2 Discourage the removal or replacement of housing affordable to very-low; low- and
moderate income households by higher-cost housing, and avoid permit approvals,
municipal actions or public projects that remove or adversely impact such housing
unless such actions are necessary to achieve General Plan objectives and: (1) it can be
29
San Luis Obispo Housing Element, March 30,2004
demonstrated that rehabilitation of lower-cost units at.risk of replacement is financially
or physically infeasible; or(2) an equivalent number of new units comparable or better
in affordability and amenities to those being replaced are provided, or (3) the project
will correct substandard, blighted or unsafe housing; and (4) replacement will not
adversely affect a designated historic resource.
3.2.3 Encourage seismic upgrades of older dwellings to reduce the risk of bodily harm and
the loss of housing in an earthquake.
3.2.4 Encourage the construction, preservation, rehabilitation or expansion of residential
hotels, group homes, integrated community apartments, and single-room occupancy
dwellings.
3.2.5 Preserve historic homes and other types of historic residential buildings, historic
districts and unique or landmark neighborhood features.
3:2.6 Preserve the fabric, amenities, yards (i.e. setbacks), and overall character and quality of
life of established neighborhoods.
3.3 Programs
3.3.1 When the City finds affordable unit removal is necessary in connection with a
municipal project, it shall help displaced residents find affordable replacement housing
and assist with relocation costs.
3.3.2 When the City permits private development projects that displace affordable housing,
it will require the developer to assist displaced residents fmd affordable local
replacement housing. Such measures may include: first priority in purchasing or
renting new affordable dwellings to be developed on-site, assistance with relocation
costs, or other financial measures.
3.3.3 Evaluate, and where necessary, revise building, zoning and fire code requirements
which discourage housing and encourage the conversion of housing to other uses.
3.3.4 Using State or Federal grant funds such as Community Development Block Grants, or
other funding sources, the City will establish a housing rehabilitation program
offering low-cost loans or other rehabilitation assistance to those who cannot afford or
obtain conventional financing. The purposes of the program shall be to remove
unsafe, unsanitary or illegal conditions, maintain safe housing, and preserve
neighborhoods.
3.3.5 Preserve the number of dwellings in the Downtown Core (C-D Zone) and the
Downtown Planning Area by adopting a "no net housing loss" program by amending
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San Luis Obispo Housing Element,March 30,2004
the Downtown Housing Conversion Permit ordinance. The amendment shall ensure
that within each area, the number of dwellings removed shall not exceed the number
of dwellings added.
3.3.6 Identify residential properties and districts eligible for local, State or Federal listing
and prepare guidelines and standards to help property owners repair, rehabilitate and
improve properties in a historically and architecturally sensitive manner.
3.3.7 To encourage housing rehabilitation, amend the Affordable Housing Standards to
allow a reduced term of affordability for rehabilitated units, to the extent allowed by
State or Federal law, with a minimum term of three years.
3.3.8 Establish a monitoring and early warning system to track affordable housing units at-
risk of being converted to market rate housing.
Goal 4.1 Mixed-Income Housing. Preserve and accommodate existing and new mixed-
income neighborhoods and seek to prevent neighborhoods or housing types that are
segregated by economic status.
4.2 Policies
4.2.1 Within newly developed neighborhoods, housing that is affordable to various
economic strata should be intermixed rather than segregated into separate enclaves.
The mix should be comparable to the relative percentages of very-low, low, moderate
and above-moderate income households in the City's quantified objectives.
4.2.2 Include both market-rate and affordable units in apartment and residential
condominium projects and intermix the types of units. Affordable units should be
comparable in appearance and basic quality to market-rate units.
4.2.3 Very low-income housing, such as that developed by the Housing Authority of the
City of San Luis Obispo or other housing providers, may be located in any zone that
allows housing, and should be dispersed throughout the City rather than concentrated
in one neighborhood or zone. In general, 23 dwellings should be the maximum
number of very-low-income units developed on any one site.
4.2.4 In its discretionary actions, housing programs and activities, the City shall
affirmatively further fair housing and promote equal housing opportunities for
persons of all economic segments of the community.
4.3 Program
4.3.1 Review new development proposals for compliance with City regulations and revise
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San Luis Obispo Housing Element, March 30,2004
projects or establish conditions of approval as needed to implement the mixed-
income policies.
Goal 5.1 Housing Variety and Tenure. Provide variety in the location,type, size,tenure,
and style of dwellings.
5.2 Policies
5.2.1 Encourage the integration of appropriately scaled, special-use housing into
developments or neighborhoods of conventional housing.
5.2.2 Encourage mixed-use residential/commercial projects to include live-work and work-
live units where housing, offices or other commercial uses are compatible..
5.2.3 Encourage the development of housing above ground-level retail stores and offices to
provide housing opportunities close to activity centers and to use land efficiently.
5.2.4 In general, housing developments of twenty (20) or more units should provide a
variety of dwelling types, sizes or forms of tenure.
53 Program
5.3.1 Review new developments for compliance with City regulations and revise projects or
establish conditions of approval as needed to implement the housing variety and
tenure policies.
Goal 6.1 Housing Production. Plan for new housing to meet the full range of community
housing needs.
6.2 Policies
6.2.1 Consistent with the growth management portion of its Land Use Element and the
availability of adequate resources, the City will plan to accommodate up to 2,909
exempt and non-exempt dwelling units between January 2001 and July 2009. Cal
Poly University intends to provide up to 1,178 housing units on State land during the
planning period.
6.2.2 New commercial developments in the Downtown Core (C-D Zone) shall include
housing, unless the City makes one of the following findings:
6.2.3
❑ Housing is likely to jeopardize the health, safety or welfare of residents or
employees;
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San Luis Obispo Housing Element,March 30,2004
❑ The property's shape, size, topography or other physical factor makes
dwellings infeasible.
6.2.4 If City services must be rationed to new development, residential projects will be
given priority over non-residential projects.
6.2.5 City costs of providing services to housing development will be minimized. Other
than for existing housing programs encouraging housing affordable to very-low and
low income persons, the City will not make new housing more affordable by shifting
costs to existing residents.
6.3 Programs
6.3.1 Amend the General Plan and Residential Growth Management Regulations (SLOMC
17.88) to exempt all new housing in the C-D zone, and new housing in other zones
that is enforceably restricted for very low-, low- and moderate-income households,
pursuant to the Affordable Housing Standards. In expansion areas, the overall
number of units built must conform to the city-approved phasing plan.
6.3.2 Amend the Zoning Regulations to allow flexible parking regulations for housing
development, especially in the Downtown Core (C-D Zone), including the possibility
of reduced or no parking requirements where appropriate guarantees limit
occupancies to persons without motor vehicles or who provide proof of reserved, off-
site parking.
63.3 Provide incentives to encourage additional housing in the Downtown Core,
particularly in mixed-use developments. Incentives may include flexible density, use,
height, or parking provisions, fee reductions, and streamlined development review
and permit processing.
6.3.4 Amend the Parking Management program to promote housing in the Downtown Core
by allowing flexible use of city parking facilities by Downtown residents, where
appropriate. Such use may include requirements for parking use fees, use limitations
and enforcement provisions.
6.3.5 Specific plans for designated Expansion Areas shall include appropriately zoned land
to meet the City's regional housing need for dwellings affordable to very low- and
low-income households, including R-3 and R-4 zoning. These plans shall include
sites suitable for subsidized rental housing and affordable rental and owner-occupied
units. Such sites shall be integrated within neighborhoods of market-rate housing and
shall be architecturally compatible with the neighborhood.
6.3.6 Specific plans shall designate sufficient areas at appropriate densities to
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San Luis Obispo Housing Element,March 30,2004
accommodate the types of dwellings that would be affordable in the percentages
called for by this Element. Also, specific plans will include programs to assure that
the affordable dwellings actually will be produced.
6.3.7 Consider amendments to the General Plan to rezone commercial, manufacturing or
public facility zoned areas for residential use, to promote higher-density, infill or
mixed-use housing where land development patterns are no longer valid and where
impact to Low Density Residential areas is minimal. For example, areas to be
considered for possible rezoning include, but are not limited to the following sites
(shown in Figure 1):
a) Little Italy district and portions of Broad Street corridor
b) Mid-Higuera corridor, between Fontana Avenue and Prado Road
c) 791/861 Orcutt Road
d) West side of Ferrini Road,between Cerro Romauldo and Felton Way
e) 3730 South Higuera Street
f) 1642 Johnson Avenue and 1499 San Luis Drive (rezone vacant and underutilized
school district property)
g) 1030 Southwood Drive
6.3.8 Support regional efforts to establish a countywide affordable housing fund to be
funded through a countywide, dedicated revenue source rather than diverting existing
affordable housing trust funds. The City should manage its Affordable Housing
funds generated through the Inclusionary Housing Program to assist affordable
housing development in the City.
6.3.9 Balance City efforts to encourage residential development by focusing as much on
infill development and densification within City Limits as on annexation of new
residential land.
34
San Luis Obispo Housing Element, March 30,2004
Figure 1
Areas to be Considered for Possible Rezoning
•r C d ` I
_it _,,J`^a•
i
35
San Luis Obispo Housing Element, March 30,2004
6.3.10 Seek opportunities with other public agencies and public utilities to identify,
assemble, develop, redevelop and recycle surplus land for housing, and to convert
vacant or underutilized public, utility or institutional buildings to housing.
6.3.11 Develop multi-family housing design standards to promote innovative, attractive, and
well-integrated higher-density housing. Developments that meet these standards shall
be eligible for a streamlined level of planning and development review.
Developments that include a significant commitment to affordable housing may also
be eligible to receive density bonuses, parking reductions and other development
incentives, including City financial assistance.
6.3.12 Financially assist in the development of 90 new ownership or rental units affordable
to very-low, low- and moderate-income households during the planning period using
State, Federal and local funding sources.
6.3.13 Actively seek new revenue sources, including State, Federal and private/non-profit
sources, and financing mechanisms to assist affordable housing development and
first-time homebuyer assistance programs.
6.3.14 Exempt the construction, relocation, rehabilitation or remodeling of up to four
dwellings of up to 1200 square feet each from Architectural Review Commission
review. New multi-unit housing may be allowed with "Minor or Incidental" or staff
level architectural review, unless the dwellings are located on a sensitive or
historically significant site.
6.3.15 Consider amendments to the Zoning Regulations to increase residential density limits
in the Downtown Core (C-D Zone).
6.3.16 Assist in the production of long-term affordable housing by identifying vacant or
underutilized City-owned property suitable for housing, and dedicate public property,
where feasible and appropriate, for such purposes.
Goal 7.1 Neighborhood Quality. Maintain, preserve and enhance the quality of
neighborhoods, encourage neighborhood stability, and improve neighborhood appearance and
function.
7.2 Policies
7.2.1 Within established neighborhoods, new residential development shall be of a
character, size, density and quality that preserves the neighborhood character and
maintains the quality of life for existing and future residents.
7.2.2 Higher density housing should maintain high quality standards for unit design,
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San Luis Obispo Housing Element,March 30,2004
privacy, security, on-site amenities, and public and private open space. Such
standards should be flexible enough to allow innovative design solutions in special
circumstances, e.g. in developing mixed-use developments or in housing in the.
Downtown Core.
7.2.3 Within established neighborhoods, housing should not be located on sites designated
in the General Plan for parks or open space.
7.2.4 Within expansion areas, new residential development should be an integral part of an
existing neighborhood or should establish a new neighborhood, with pedestrian and
bicycle linkages that provide direct, convenient and safe access to adjacent
neighborhoods, schools and shopping areas..
7.2.5 The creation of walled-off residential enclaves, or of separate, unconnected tracts, is
discouraged because physical separations prevent the formation of safe, walkable,
and enjoyable neighborhoods.
7.2.6 Housing shall be sited to enhance safety along neighborhood streets and in other
public and semi-public areas.
7.2.7 The physical designs of neighborhoods and dwellings should promote walking and
bicycling, and should preserve open spaces and views.
73 Programs
7.3.1 Implement varied strategies to ensure residents are aware of and able to participate in
planning decisions affecting their neighborhoods early in the planning process.
7.3.2 Identify specific neighborhood needs, problems, trends and opportunities for
improvements. Work directly with neighborhood groups and individuals to address
concerns.
7.3.3 Help fund neighborhood improvements, including sidewalks, traffic calming devices,
crosswalks, parkways, street trees and street lighting to improve aesthetics, safety and
accessibility.
7.3:4 Continue to develop and implement neighborhood parking strategies, including
parking districts, to address the lack of on- and off-street parking in residential areas.
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San Luis Obispo Housing Element,March 30,2004
Goal 8.1 Special Housing Needs. Encourage the creation and maintenance of housing for
those with special housing needs.
8.2 Policies
8.2.1 Encourage housing development that meets a variety of special needs, including large
families, single parents, disabled persons, the elderly, students, the homeless, or those
seeking congregate care, group housing, single-room occupancy or co-housing
accommodations, utilizing universal design for accessibility,where appropriate.
8.2.2 Preserve manufactured housing parks and support changes in this form of tenure only
if such changes provide residents with greater long-term security or comparable
housing in terms of quality, cost, and livability.
8.2.3 Encourage manufactured homes in Expansion Areas by:
a) Encouraging developers to create owner-occupied manufactured home parks with
amenities such as greenbelts, recreation facilities, and shopping services within a
master planned community setting. Such parks could be specifically designed to
help address the needs of those with mobility and transportation limitations.
b) Establish lot sizes, setback, and parking guidelines that allow for relatively dense
placement of manufactured homes within the master planned neighborhood.
c) Locate manufactured home parks near public transit facilities or provide public
transportation services to the manufactured home parks to minimize the need for
residents to own automobiles.
8.2.4 Encourage Cal Poly University to continue to develop on-campus student housing to
meet existing and future needs and to lessen pressure on City housing supply and
transportation systems.
8.2.5 Strengthen the role of on-campus housing by encouraging Cal Poly University to
require entering freshmen students to live on campus during their first year.
8.2.6 Locate fraternities and sororities on the Cal Poly University campus. Until that is
possible, they should be located in Medium-High and High Density residential zones
near the campus.
8.2.7 Encourage Cal Poly University to develop faculty and staff housing, such as sites
designated H-8 and H-9 located on State-owned land along State Highway 1, and
consistent with the General Plan
38
San Luis Obispo Housing Element, March 30, 2004
8.2.8 Encourage Cuesta College to explore opportunities and strategies for the development
of student housing to meet both existing and future needs, to lessen pressure on City
housing supply and transportation systems.
8.2.9 Disperse special-needs living facilities throughout the City rather than concentrate
them in one district.
8.3 Programs
8.3.1 As funding allows, support local and regional solutions to meeting the needs of the
homeless and continue to support, jointly with other agencies, shelters for the
homeless and for displaced women and children.
8.3.2 Continue the mobile home rent stabilization program to minimize increases in the
cost of mobile home park rents.
8.3.3 Identify .sites in specified expansion areas suitable for tenant-owned mobile-home
parks, cooperative housing, manufactured housing, self-help housing, or other types
of housing that meet special needs.
8.3.4 Advocate developing non-dormitory housing on the Cal Poly University campus and
refurbishing existing campus housing and its associated programs to make campus
living more attractive and affordable.
8.3.5 Work with Cal Poly University Administration to secure designation of on-campus
fratemity/sorority living groups.
8.3.6 Jointly develop and adopt a student housing plan and "good neighbor program" with
Cal Poly University, Cuesta College and'City residents. The program would seek to
improve communication and cooperation between the City and the schools, set on-
campus student housing objectives and establish clear, effective standards for student
housing in residential neighborhoods.
8.3.7 Provide public educational information at the City's Community Development
Department public counter on universal design concepts in new construction.
Goal 9.1 Sustainable Housing, Site, and Neighborhood Design. As part of its
overall commitment to quality of life for its citizens, and to maintaining environmental quality,
the City encourages housing that is resource-conserving, healthful, economical to live in,
environmentally benign, and recyclable when demolished.
39
San Luis Obispo Housing Element, March 30,2004
9.2 Policies
9.2.1 Residential developments should promote sustainability in their design, placement,
and use. Sustainability can be promoted through a variety of housing strategies,
including the following:
a) Maximize use of renewable, recycled-content, and recycled materials, and
minimize use of building materials that require high levels of energy to produce or
that cause significant, adverse environmental impacts.
b)Incorporate renewable energy features into new homes, including passive solar
design, solar hot water, solar power, and natural ventilation and cooling.
c) Minimize thermal island effects through reduction of heat-absorbing pavement and
increased tree shading.
d)Avoid building materials that may contribute to health problems through the
release of gasses or glass fibers into indoor air.
e)Design dwellings for quiet, indoors and out, for both the mental and physical
health of residents.
f)Design dwellings economical to live in because of reduced utility bills, low cost
maintenance and operation, and improved occupant health.
g)Use construction materials and methods that maximize the recyclability of a
building's parts.
h) Educate public, staff,and builders to the advantages and approaches to sustainable
design, and thereby develop consumer demand for sustainable housing.
i) City will consider adopting a sustainable development rating system, such as the
LEED program.
9.2.2 Residential site, subdivision, and neighborhood designs should be coordinated to
make residential sustainability work. Some ways to do this include:
a) Design subdivisions to maximize solar access for each dwelling and site.
b) Design sites so residents have usable outdoor space with access to both sun and
shade.
c) Streets and access ways should minimize pavement devoted to vehicular use.
40
San Luis Obispo Housing Element,March 30,2004
d) Use neighborhood retention basins to purify street runoff prior to its entering
creeks. Retention basins should be designed to be visually attractive as well as
functional. Fenced-off retention basins should be avoided.
e) Encourage cluster development with dwellings grouped around significantly-
sized, shared open space in.return for City approval of smaller individual lots.
f) Treat public streets as landscaped parkways, using continuous plantings at least
six feet wide and where feasible, median planters to enhance, define, and to buffer
residential neighborhoods of all densities from the effects of vehicle traffic.
9.2.3 Preserve the physical neighborhood qualities in the Downtown Planning Area that
contribute to sustainability. Some ways to do this include:
a) Maintain the overall scale, density and architectural character of older
neighborhoods surrounding the Downtown Core.
b) Encourage the maintenance and rehabilitation of historically designated housing
.stock.
9.2.4 To promote energy conservation and a cleaner environment, encourage the
development of dwellings with energy-efficient designs, utilizing passive and active
solar features, and the use of energy-saving techniques that exceed minimums
prescribed by State law.
9:2.5 Actively promote water conservation through housing and site design to help
moderate the cost of housing.
9.3 Programs
9.3.1 Educate planning and building staff and citizen review bodies on energy conservation
issues, including the City's energy conservation policies and instruct that they work
with applicants to achieve the housing goals that conserve energy.
9.3.2 Revise the Energy Conservation Element to address residential energy conservation
for both new and existing dwellings. Disseminate this information to the public.
9.3.3 Evaluate present solar siting and access regulations to determine if they provide
assurance of long-term solar access for new or remodeled housing and for adjacent
properties, and revise regulations found to be inadequate.
9.3.4 Consider adopting street and access way standards that reduce the amount of paving
devoted to vehicular use.
41
San Luis Obispo Housing Element,March 30,2004
Goal 10.1 Local Preference. Maximize affordable housing opportunities for those who live
or work in San Luis Obispo while seeking to balance job growth and housing supply.
10.2 Policies
10.2.1 Administer City housing programs and benefits, such as First Time Homebuyer
assistance or affordable housing lotteries, to give preference to: 1) persons living or
working in the City or within the City's Urban Reserve, and 2) persons living in San
Luis Obispo County.
10.2.2 Cal Poly State University and Cuesta College should actively work with the City and
community organizations to create positive environments around the Cal Poly
Campus by:
a) Establishing standards for appropriate student densities in neighborhoods near
Campus;
b) Promoting homeownership for academic faculty and staff in Low-Density
Residential neighborhoods near Campus; and
c) Encouraging and participating in the revitalization of degraded neighborhoods.
103 Programs
10.3.1 Work with the County of San Luis Obispo to mitigate housing impacts on the City
due to significant expansion of employment in the unincorporated areas adjacent to
the City. Such mitigation might include, for example, County participation and
support for Inclusionary Housing Programs.
10.3.2 Encourage residential developers to promote their projects within the. San Luis
Obispo housing market area(San Luis Obispo County) first.
10.3.3 Advocate the establishment of a link between enrollment and the expansion of
campus housing programs at Cal Poly University and Cuesta College to reduce
pressure on the City's housing supply:
10.3.4 Work with other jurisdictions to advocate for State legislation that would: 1)provide
funding to help Cal Poly University and Cuesta College provide adequate on-campus
student housing, and 2) allow greater flexibility for State universities and community
colleges to enter into public-private partnerships to construct student housing.
Goal 11.1 Suitability. Develop and retain housing on sitesthat are suitable for that purpose.
11.2 Policies
42
San Luis Obispo Housing Element,March 30,2004
11.2.1 Where property is equally suited for commercial or residential uses, give preference
to residential use. Changes in land use designation from residential to non-residential
should be discouraged.
11.2.2 Prevent new housing development on sites that should be preserved as dedicated
open space or parks, on sites subject to natural hazards such as unmitigatable
geological or flood risks, or wild fire dangers, and on sites subject to unacceptable
levels of man-made hazards or nuisances, including severe soil contamination, airport
noise or hazards, traffic noise or hazards, odors or incompatible neighboring uses.
113 Program
11.3.1 The City will adopt measures ensuring the ability of legal, conforming non-
residential uses to continue where new housing is proposed on adjacent or nearby
sites.
3.40 Implementation Tools
A variety of Federal, State and local programs and resources are available to help implement the
City's housing goals and activities. These include both financial resources, as well as in-kind
incentives that help address housing needs. Table 3 lists the available resources, incentives and
other tools that can help address housing needs.
Table 3
Resoumes/Incentives Available For Housin Activities
Program Descri tion Eligible Activities
Local Resources
City of San Luis Obispo Affordable In-lieu fees paid by developers to Any expense in support of
Housing Fund meet inclusionary housing affordable housing development,
requirements. subject to City Council approval and
adopted criteria(Res.No.9263,
2001 Series).
Development Services Fee Waivers Residential development projects . Affordable housing projects
that meet City affordable housing . Mixed-use developments with
standards for very low- and low- affordable units
income households are exempt from . Senior housing projects
all planning, engineering and
building review, processing and
permit fees, water and sewer meter
hook-up fees. Projects with a
combination of market-rate and
affordable units receive the waiver
43
San Luis Obispo Housing Element, March 30,2004
on aper-unit basis.
Impact Fee Waivers Citywide development impact fees Affordable housing projects
are waived for affordable residential • Mixed-use developments with
units that: 1) exceed the minimum affordable units
required under inclusionary housing • Senior housing projects
standards, or 2) are built, owned and
managed by the San Luis Obispo
Housing Authority,other government
agencies, or not-for-profit housing
a encies.
Density Bonus The City allows an increase in Affordable housing
residential density of at least 25%for projects
development projects that reserve at • Mixed-use developments
least 20% of the units for low, or with affordable units
moderately affordable housing; or Senior housing projects
10% of the units for very low
income; or at least 50% of the units
for qualifving seniors.
Alternative Incentives When developers agree to construct • Affordable housing
very low-, low-, moderate-income or projects
senior housing, the City may a Mixed-use developments
negotiate an alternative incentive of with affordable units
comparable value to the density o Senior housing projects
bonus, such as exceptions to
development standards, direct
financial assistance,, or city
installation of offsite improvements.
Flexible Development Standards A variety of flexible development • Affordable housing
standards is available for affordable projects
and senior housing, and for the e Mixed-use developments
preservation and rehabilitation of with affordable units
historic homes and apartments. . Senior housing projects
These include easing of parking • Historic homes and
standards and building setbacks, apartments
height and lot coverage exceptions . Planned residential
(with approval of Planned developments
Development rezoning), and • Non-conforming residential
provisions for restoring non- restoration
conforming residential buildings
following a fire or other disaster.
Grants-In-Aid Funds Grants-In-Aid funds are available • Not-for-profit social service
annually to assist social service and and housing providers
housing providers with special, non-
recurring costs to augment affordable
housing programs.
Mills Act Program Reduces property taxes on historic Historic preservation
residential and commercial . Residential rehabilitation
properties in return for owner's . Mixed-use historic
agreement to preserve, and in some rehabilitation
cases, improve
the property. Minimum 10 ears'
44
San Luis Obispo Housing Element, March 30,2004
participation; up to 10 properties can
be added to the program per year.
Technical Assistance Technical assistance is available to • Affordable housing
help renters, homeowners, housing developments
developers, and not-for-profit . Market-rate housing
housing developers find,design, fund developments
or build affordable housing. • Housing consumers
State Resources
Multi-Family Housing Revenue Cooperate with non-profit housing • Affordable housing projects
Bonds providers to enable issuance of . Mixed-use developments with
multi-family housing revenue bonds affordable units
• Senior housing projects
Mortgage Credit Certificate Federal tax credit for low- and . First-time homebuyer's
moderate-income homebuyers who assistance
have not owned a home in the past
three years.
Proposition 46 Funds $2.1 billion bond measure adopted . Affordable housing projects
by California voters in 2002 . Mixed-use developments with
establishes various housing grants affordable units
and loans for affordable housing. . Senior housing projects
• Special needs housing
Mobile Home Park Conversion Funds awarded to mobile-home park • Mobile-home park acquisition
Program tenant organizations to convert and development
mobile-home parks to resident
ownership.
CaIHFA — California Housing HELP Program and other below- • Low- and moderate-income
Finance Agency market-rate financing and deferred affordable single- and multi-
loans for affordable housing family housing
development.
CaHLIF — California Housing Loan Provides primary mortgage insurance • First-time homebuyers
Insurance Fund for hard-to-qualify borrowers, • Low- and moderate- income
expanding home ownership homebuyers
opportunities. • Workforce housing loans
CIEDB — California Infrastructure Provides low-cost financing for . Cities
and Economic Development Bank public infrastructure to support . Private sector
housing and economic development. Non-profits
Low-Income Housing Tax Credit Tax credits available to individuals Acquisition
and corporations investing in low- Housing rehabilitation
income rental housing. Tax credits • New construction
are issued through the State and sold
to corporations and others with high
tax liability, with proceeds used for
housing development.
Federal Resources—Entitlement
Community Development Block Grant awarded to the City annually • Section 108 Loan Payments
Grants(CDBG) on a formula basis to fund housing • Historic preservation
and economic development for low- . Property acquisition for
and moderate-income persons. housing
45
San Luis Obispo Housing Element,March 30,2004
• Housing rehabilitation
• Public services and facilities
• Code enforcement
• Fair housing activities
• Economic development
HOME Investment Partnership Grant program specifically for a Single-or multi-family housing
(HOME)Program housing. Designed as partnership acquisition/rehab/construction
funding, requires local match funding • CHDO Assistance
and one of the best sources of new Administration
housing funding.
Emergency Shelter Grants Grant awarded on an annual formula . Homelessness prevention
basis for shelter and services to • Continuum of care
homeless persons. • Operating expenses
Housing Opportunities for Persons Funds available county-wide for • Rental assistance
With AIDS(HOPWA) supportive services and housing for a Social services
persons with HIV/AIDS. • Housing
Historic Rehabilitation Tax Credit Provides a 10-20%one-time, IRS tax • Rental housing rehabilitation
credit on eligible rehabilitation costs a Mixed-use projects
for pre-1936 and National Register e Seismic strengthening
historic properties. Work must • Ownership housing ineligible
follow Secretary of the Interior
rehabilitation standards.
Federal Resources—Competitive
Supportive Housing Grant Grant to improve quality of existing o Housing rehabilitation
shelters and transitional housing.
Section 8 Rental Assistance Very-low income families, a Rental assistance for very low
individuals, seniors and the disabled. income, elderly and disabled
pay 30%of their income toward rent. persons
The SLO Housing Authority pays
the balance of rent payment.
Section 202 Grants to non-profit housing e Acquisition and Rehabilitation
developers for supportive housing . New construction
for the elderly. • Rental assistance
• Support services
Section 811 Grants to non-profit developers for • Acquisition
supportive housing for disabled • Rehabilitation
persons, including group homes, • New construction
intermediate-care facilities and e Rental assistance
independent-living facilities.
Section 108 Provides loan guarantee to CDBG • Acquisition
entitlement jurisdictions, enabling • Rehabilitation
them to borrow up to five times their • New construction
annual entitlement for major housing • Infrastructure
or capital improvement projects. 0 Historic preservation
• Economic development
Source: City of San Luis Obispo,Community Development Department
46
San Luis Obispo Housing Element, March 30,2004
chaptCR 4
quantlflea osjectives
4.10 Overview
State housing law requires that each jurisdiction identify the number of housing units that will be
built, rehabilitated and preserved during the Housing Element's planning period. These
projections are termed "quantified objectives." Quantified housing objectives allow the
community to evaluate its progress toward meeting key housing needs to help prioritize planning
and funding efforts. They are based on the City's regional housing needs allocation and the
Housing Needs Assessment, and are adopted policy. However, San Luis Obispo cannot
guarantee these objectives will be met, given limited financial resources, costs to provide public
facilities to serve new development, and the growing, statewide gap between housing costs and
incomes. Meeting the City's quantified housing objectives will depend, in part, upon real estate
market forces, developers' and lenders' financial decisions and the availability of local, State and
Federal funding.
4.20 New Housing Construction Completed
Table 4 shows the number of new housing units completed between January 1, 2001 and
December 31, 2003. Dwellings completed during this period are credited toward meeting the
City's quantified objectives during the seven-and-one-half-year planning period from January 1,
2001 to July 1, 2009.
Table 4
Housing Units Completed
Januar2001 throu h December 2003
Above
Unit Type Very Low Low Moderate Moderate Total
Single-family 0 0 46 334 380
Multi-family 19 70 185 203 477
TOTALS 19 70 231 537 857
Source: City of San Luis Obispo,Community Development Department
includes 201 on-campus apartments at Cal Poly State University
47
San Luis Obispo Housing Element,March 30,2004
4.30 New Housing Construction Objectives
Table 5 shows the new housing construction objectives for January 1, 2004 through June 30,
2009. It includes all types of housing, both rental and for-sale units, and these are added to the
completed housing units from Table 4 to meet the City's quantified housing needs for new
construction.
Table 5
New Housing Construction Objectives
Jan ary 2004 to July 2009
Above
Unit T e VeryLow Low Moderate Moderate Total
Single-family 20 283 234 226 1,291
Multi-family 1,351 424 352 340 1,939
Subtotal 1,371 707 586 566 3,230
Units Completed,
1/1/01 thru 12/31/03 19 70 231 537 857
TOTAL 1,390 777 817 1,103 4,087
Assigned RHNA 1,484 844 870 1,185 4,383
Source: City of San Luis Obispo,Community Development Department
`Given the deep subsidies needed to construct very-low income single-family units, most housing for very-low
income expected to be multi-family units.
New housing construction objectives include 977 units of student and faculty housing to be
developed by the Cal Poly University Foundation, in addition to 201 apartments developed on
campus in 2003. The objectives are based on an assumed construction ratio of single family to
multi-family housing of 40:60, and a percent distribution of housing for income groups which is
similar to that of the City's RHNA number: Very-low—34%, Low— 19%, Moderate—20%, and
Above Moderate — 27%. A reduced objective was set for Very-Low, Single-Family construction
given the high cost and deep subsidies needed for this type of housing. To meet this income
need, it is likely that virtually all of the units will be higher density, multi-family rental housing.
4.40 Preservation of At-Risk Units
Dwellings built with some form of government assistance or subsidy typically must remain
affordable to very low-, low- or moderate-income households for a specific period. As the end of
the affordability term nears, an affordable unit is said to be at-risk of conversion to market-rate
housing. There are several reasons why government-assisted housing might convert to market-
rate housing, including expiring subsidies, mortgage prepayments, or most commonly, expiration
of affordability and resale restrictions. A 30-year affordability requirement is common; however,
the term varies depending upon the source and terms of funding.
48
San Luis Obispo Housing Element,March 30,2004
State law requires jurisdictions to identify government-assisted, multi-family housing that is at
risk of converting to market rate during the next 10 years. These include units receiving funding
under a variety of government programs, such as HUD Section 8, HUD Section 202, IRS Section
42 (Tax Credit projects), Federal Community Development Block Grants and local programs
using inclusionary housing requirements, in-lieu fees and density bonuses. In addition,
jurisdictions also must describe measures to prevent at-risk from converting to market rate.
Based on information provided by the City's Housing Authority, local non-profit housing
providers, and the State Housing and Community Development Department, there are no very-
low or low-income units at risk of losing their affordability restrictions and converting to market
rate between January 2001 and January 2011. Nevertheless, Housing Element programs 2.3.12
and 3.3.8, and quantified objectives have been incorporated into the Housing Element to help
preserve these affordable units. These programs will establish a monitoring and early warning
system to track affordable housing units at-risk of being converted to market rate housing within
subsequent planning periods (after 2009); and with the Housing Authority of the City of San Luis
Obispo and other local housing agencies, provide ongoing technical assistance and education to
tenants, property owners and the community at large on the need to preserve at-risk units as well
as the tools available to help do so.
4.50 Rehabilitation and Preservation Objectives
The City's existing affordable housing stock is a valuable resource that should be preserved and,
where necessary and feasible, rehabilitated rather than demolished. By enforcing City building
and zoning codes, the safety, quality and durability of existing homes and neighborhoods is
enhanced, thus maintaining the housing stock's diversity in type, tenure and cost. Often, the
primary beneficiaries of preservation and rehabilitation programs are renters and low-income
homeowners. Table 6 lists the number of units to be rehabilitated, preserved or financially
assisted, and the number of conservation/code enforcement cases during the planning period.
Table 6
Rehabilitation, Preservation, and Conservation Objectives
January 2001 to July 2009
Very Low I Low Moderate Total
REHABILITATION
•
Single-family rehab 10 7 3 20
•
Multi-family rehab 30 20 -- 50
• Historic preservation 10 5 5 20
rehab
PRESERVATION
• At-risk units preserved n/a n/a n/a n/a
49
San Luis Obispo Housing Element, March 30,2004
CONSERVATIONJCODE ENFORCEMENT
• Code enforcement cases 150 50 25 225
FINANCIAL ASSISTANCE
• 1 st-time homebuyer 0 25 25 50
program
• Affordable housing fund 50 1 25 25 100
Source: City of San Luis Obispo,Community Development Department
4.60 Quantified Objectives Summary
During the Housing Element's eight and one-half year planning period from January 2001 to July
2009, policies and programs will accommodate a net increase of up to 4,087 dwellings. This
goal is based on anticipated water supplies and land available and suitable for residential use.
The objectives seek to develop housing that meets affordability standards for the income groups
in the same proportion as the RHNA allocation, and to emphasize the production of multi-family,
higher density housing, where appropriate. A key component is new housing to be developed by
Cal Poly University on and adjacent to the campus on State land, using University Foundation
funding.
Table 7
Quantified Objectives Summa , 2001 - 2009
Income Level New Rehabilitation Financial Conservation Z
Construction' . Assistance
Very Low 1,390 50 50 150
Low 777 32 50 50
Moderate 817 8 50 25
Above Moderate 1,103 -- -- --
Totals 4,087 90 150 225
Source: City of San Luis Obispo,Community Development Department
'Includes 1,178 dwellings developed on State land for Cal Poly University students, faculty and staff
''Not included in summary totals.
Although the quantified objectives are theoretically achievable, they are not specific development
quotas. The City of San Luis Obispo intends to use the financial, planning and administrative
resources at its disposal to accomplish the objectives, but cannot guarantee that these
construction goals will be achieved given limited financial resources, economic uncertainty,
independent marketing decisions regarding housing development, and the present gap between
50
San Luis Obispo Housing Element,March 30,2004
housing cost and incomes. Satisfaction of the quantified objectives will hinge largely upon
private development decisions and the City's ability to leverage additional Federal, State or local
funding to meet very-low, low- and moderate income housing needs.
51
San Luis Obispo Housing Element,March.30,2004
Appendix A
Iff
Community Profile
To understand San Luis Obispo's housing needs, an overall profile of the community is essential.
Statistical information provided in this appendix, derived mainly from the 2000 Census, forms
the basis for the goals, policies and programs in Chapter 3, and for establishing quantified
housing objectives in Chapter 4, as required by State law. Social, economic and housing
characteristics are analyzed to determine how these factors affect housing needs, costs and
availability.
1. Population Trends and Characteristics
San Luis Obispo is one of seven cities located within San Luis Obispo County, and is the largest
in terms of population. As shown in Table A-1, the City's estimated population is 44,359
(California Department of Finance, January 2003). In January 2003, about 17 percent of County
residents lived in the City of San Luis Obispo. Between 1990 and 2000, the City grew by 2,216
persons, an increase of five percent. As the result of a nationwide economic slowdown in the
early 1990s, San Luis Obispo's population growth rate declined significantly, mirroring county
and Statewide trends. During the 1990s, city population growth stabilized at an average annual
growth of 0.5 percent, while County and State population growth rates slowed to an annual
average of about 1.4 percent. City growth rates in the 1980s slightly exceeded the targeted two
percent, and fell below the one percent growth rate anticipated for the 1990s and beyond.
Between 2000 and 2003, State population estimates (California Department of Finance) show the
City's population increasing by 1,332 persons, an average annual growth of about one percent.
Analysis of U.S. Census data and Department of Finance population estimates indicates that
population growth in the City primarily has been due to net migration to the housing market area.
The General Plan Land Use Element (LUE) includes policies to accommodate an eventual City
population of 57,700. At a one percent annual average growth rate, the City's anticipated
residential capacity would be reached by the year 2022.
During the 1980s, the City's annual population growth rate averaged a little over two percent,
while the job growth rate was about three percent. During the same period the County's
population grew by about 3.5 percent annually, while the job growth rate averaged about 3.8
percent. In 1991, the City population was stable or declined slightly, while the overall County
population increased about two percent.
San Luis Obispo Council of Governments projections show the County's population as a whole
growing at a little more than one percent annually between 1990 and 2020. State officials predict
that the State's population will grow by almost 30 million new residents, averaging about 1.65
52
San Luis Obispo Housing Element, March 30,2004
percent population growth annually from 2000 to 2020. Federal officials estimate an annual
average growth rate of about 0.9 percent nationwide during the same period.
Table A-1
Population Growth, 1980 - 2000
San Luis Obis o Ci , County and State of California
1980 1990 Change 2000 Change
Population Population 1980-1990 Population 1990-2000
No. of % No.of %
persons persons
City 34,252 41,958 7,706 22 44,174 2,216 5
County 155,435 217,162 61,727 40 246,681 29,519 14
State 23,770,855 29,760,021 5,989,166 25 33,871,648 4,111,627 14
Source: U.S.Census 2000
The slowdown in City population growth that began in the early 1990s continued into the first
three years of the new decade. Economic factors at the national and State levels slowed job and
population growth in many areas, including San Luis Obispo. In addition, lower costs of land
and development in north and south San Luis Obispo County areas compared with the City of
San Luis Obispo and beach communities contributed to higher population growth rates in those
areas.
As part of its regional planning functions, the San Luis Obispo Council of Governments
(SLOCOG) develops and publishes regional population, employment and housing forecasts.
Table A-2 shows the projections for city, county and State populations from 2000 to 2008. San
Luis Obispo City's population growth rate is expected to peak in 2006-2007, and then to stabilize
at a slowly declining rate until build out, anticipated in 2022.
53
San Luis Obispo Housing Element, March 30,2004
Table A-2
Population Projections, 2001 - 2008
San Luis Obispo City, County and State of California
Projected Population
2001 2002 2003 2004 2005 2006 2007 2008 Annual
Growth
City 43,008 43,438 43,872 44,311 44,754 45,202 45,654 46,110 1.0
County 2531,399 256,946 260,543 264,191 267,890 271,640 275,443 279,299 1.4
State 35,078.9 35,667.2 36,276.2 36,874.9 37,473.5 38,030.9 1 38,588.3 1 39,145.7 1.3
1000
Source: San Luis Obispo Council of Governments,U.S.Census and California State Department of Finance
a) Age Composition
San Luis Obispo's age profile is shown in Tables A-3 and A-4. When compared with the County
and State, San Luis Obispo has significantly lower percentages of teens and children, and adults
in the primary childbearing years of 25-44. The City's percentage of seniors 60 years or older is
slightly smaller than in the County, but reflects the State's overall percentage for this age group.
Due to the concentration of young adults attending Cuesta College and Cal State Polytechnic
University, San Luis Obispo's component of young adults ages 20 — 24 is almost three times
larger than the county as a whole, and almost four times larger than this age group's percentage
of the State's total population. As discussed in Appendix B, this demographic trend has
important implications for the San Luis Obispo area housing market in terms of housing type and
tenure, and demand. Students comprise an increasingly larger proportion of City residents,
while the percentage of middle age, "prime working age" persons in the City has declined since
1990.
54
San Luis Obispo Housing Element,March 30,2004
Table A-3
Age Distribution, 2000
San Luis Obispo City, County and California State
— . _Age-Categoriesin.years,by-Percent of.Total Population
Under 20 20-24 25-44 45 49 60 or Older
City 22 26 24 14 14
County 26 9 27 19 19
State 30 7 32 17 14
Source: U.S.Census 2000
Another measure of City age dynamics is reflected in the pre-primary school enrollment figures
for 1990 and 2000. Table A-4 shows the population over three years of age and enrolled in either
pre-school or kindergarten. The percentage of the total population enrolled in pre-primary school
was stable in San Luis Obispo City between 1990 and 2000, while the County and State showed
small increases during this period. The local school district has experienced an overall decrease
in school enrollment for Kindergarten through grade 12 during this decade.
Table A-4
Pre-Primary School Enrollment,
San Luis Obispo City, County and California State,
1990 and 2000
Jurisdiction Percent of Total Population over three years and enrolled in
Pre-School or Kindergarten
1990 2000
City 3 4
County 6 8
State 6 I1
Source: U.S. Census 2000
b)Race and Ethnicity
As shown in Table A-5, San Luis Obispo City and County are less diverse racially and ethnically
than the State as a whole. Most San Luis Obispo residents are white and of non-Hispanic origin;
however, the ethnic composition of both the City and County is slowly changing. Since the 1990
Census, the County's Hispanic population grew from about 17 percent of the white population to
about 22 percent of the white population. The Hispanic population is projected to be the fastest
55
San Luis Obispo Housing Element, March 30,2004
growing ethnic group in this decade. Table A-6 shows projected County population by race or
ethnicity for 2001 through 2010.
The Hispanic population is not distributed evenly throughout the County. In 2002, the
percentage of Hispanic or Latino persons ranged from a low of less than seven percent in the City
of Pismo Beach, to the highest percentage of 88 percent in the unincorporated town of Oceano.
Just under 12 percent of San Luis Obispo City's population is estimated to be of Hispanic or
Latino origin(2003 UCSB Economic Forecast Project, San Luis Obispo County Outlook).
Table A-5
Racial and Ethnic Composition, City and County of San Luis Obispo,
State of California, 2000
Percentage of Total Population
Racial/Ethnic White Black Native Asian Pacific Other two or
Group American Islander more
City 84 1.5 0.6 5.3 0.1 4.8 3.7
County 84.6 2 0.9 2.7 0.1 6.2 3.5
State 59.5 6.7 1 10.9 0.3 16.8 4.8
Source: U.S.Census 2000
Table A-6
Projected Change in Racial and Ethnic Composition by Percent, 2001-2010
San Luis Obispo County
Year Total White Black Native Asian/Pacific Hispanic*
American Islander
No. of % of No. of % of No. of % of No. of % of No. of
Persons total Persons total Persons total Persons Total Persons %
2001 262,123 208.693 79.6 5,309 0.02 1.741 <.01 7,807 0.03 38,573 14.7
2002 269,272 213,855 79.4 5,461 0.02 1,757 <.O1 8,155 0.03 40,044 14.8
2003 276,438 218,995 79.2 5,615 0.02 1,777 <.01 8,502 •0.03 41,549 15
56
San Luis Obispo Housing Element, March 30,2004
2004 283,400 224,001 79 5,752 0.20 1,796 <.01 8,828 0.03 43,023 15.1
2005 290.076 228,924 78.9 5,922 0.20 1,809 <.01 9,074 0.03 44,347 152
2006 296,834 233,781 78.7 6,110 0.20 1,820 <.01 9,338 0.03 45,785 15.4
2007 303,806 238,657 78.5 6,269 020 1,834 <.01 9,642 0.03 47,404 15.6
2008 310,878 243,609 78.3 6,445 020 1,856 <.01 9,940 0.03 49,028 15.7
2009 317.827 248.376 78.1 6,602 0.20 1,880 <.01 10,236 0.03 50,733 15.9
2010 324,741 253,097 77.9 6,770 0.20 1,888 <.O1 10,527 0.03 52,459 16.1
Source: California Department of Finance
--
*Persons of Hispanic origin may be of any race
2. Employment Trends
Due to its centralized location, early settlement history and transportation links via the Southern
Pacific Railroad and State Highways 101, 1 and 227, San Luis Obispo historically has served as
the County's governmental, retail and cultural hub. City and County economies historically were
based largely on agricultural activities. As shown in Table A-7, professional and managerial
occupations accounted for 39 percent of San Luis Obispo's jobs in 2000, followed by sales and
office jobs, and services with about 29 and 20 percent of the total jobs, respectively. Retail sales,
tourism, education, government, and design and technology businesses are also important drivers
of San Luis Obispo's economy.
Table A-7
Occupations of San Luis Obis o City, Countyand State Residents, 2000
City County State
Occupation Category # % # % # %
Management, professional and related 8,595 39 37,581 34.3 5,295,069 36
occupations
Service occupations 4,354 19.7 20,573 18.8 2,173,874 14.8
Sales and office occupations 6,315 28.6 27,793 25.3 3,939,383 26.8
Farming, fishing and forestry 191 0.9 2,281 2.1 196,695 1.3
57
San Luis Obispo Housing Element, March 30,2004
Construction, extraction and 1,203 5.5 10,732 9.8 1,239,160 8.4
maintenance
Production,transportation, material 1,399 6.3 10,709 9.8 1,874,747 12.7
moving
Total Employed civilian population 22,057 100 109,669 100 14,718,928 100
16 years and older
Source: U.S.Census 2000.
Numbers may not total 100%due to rounding.
The City's total work force (civilian employed persons 16 years or older) was estimated at
22,057 in the 2000 Census. In 1990, the total workforce was 21,067, reflecting an increase of
990 persons, or 4.6 percent, during the decade. San Luis Obispo's economy is relatively stable,
owing to the large number of public sector employees, and private sector employers that receive
government funds in the City and nearby unincorporated County, including the County of San
Luis Obispo, California State Polytechnic University, Cuesta College, California State
Department of Forestry, California Department of Transportation, California Army National
Guard, San Luis Coastal Unified School District and the City of San Luis Obispo. Large private
sector employers include P.G.& E., Cal Poly Foundation, Siena Vista Regional Medical Center,
French Hospital, Economic Opportunity Commission and Madonna Inn.
Unemployment, a common measure of economic health, has declined in San Luis Obispo County
since 1993, reflecting robust, sustained job growth in the County and City of San Luis Obispo.
Nevertheless, the area's economy is not immune from State and national economic forces. Due
to a national economic slowdown, countywide job growth declined from 2001 to 2003 in all
sectors except agriculture, and large city employers downsized, reducing their workforces by
over 1,000 employees in 2002. In summary, the City's economy is expected to remain strong
with slow, steady job growth and low unemployment. However, personal income in the 2000s is
expected to grow more slowly than in the previous decade (UCSB Economic Forecast Project,
2003 San Luis Obispo County Economic Outlook).
3. Household Characteristics
Household formation and characteristics are key factors shaping housing need. Following is an
analysis of household size, growth, income, tenure and household trends. By definition, a
"household" consists of all the people occupying a dwelling unit, whether or not they are related.
For example, a single person living in an apartment, four students living in an apartment, and a
couple with two children and an unrelated tenant living in the same dwelling are all considered
households.
a) Household Formation and Type
As shown in Table A-8, the 1990 Census identified 16,952 occupied housing units in the City of
58
San Luis Obispo Housing Element,March 30,2004
San Luis Obispo compared with 18,653 in 2000, an increase of 10 percent. It is interesting to
note that while the number of households increased during this period, average household size
declined by almost three percent, as shown in Table A-9, bucking the county and State trends of
slightly increasing density. In part, this may be due to the fact that very few multi-family
dwellings were built during the 1990s, and multi-family housing typically has a higher average
number of persons per household than does detached or attached single family housing.
Table A-8
Number of Households, 1990—2000
San Luis Obispo CitYq C unty and State of California
No.of No. of Change
Households in Households in
1990 2000
#
city 16,952 18,653 1,701 10
County 80,281 92,739 12,458 15.5
State 10,381,206 11, 502,870 1,121,664 10.8
Source: U.S. Census, 1990 and 2000
The declining household size is another reflection of the aging of the City's residents and the
relatively high cost of housing. As homeowners age and become "empty nesters", they often
cannot afford to "shift down" and buy smaller housing that better meets their needs and budget.
In San Luis Obispo, it is not uncommon for a three- and four-bedroom house to be occupied by
one or two persons. As average households grow smaller, the existing housing stock
accommodates fewer people, further exacerbating housing needs, particularly for families and
large households.
Table A-9
Household Size, 1990—2000
San Luis Obispo City, C unty and State of California
Average No.of Average No.of Change
persons per persons per
household in household in
April 1990 January 2000
City 2.388 2.322 -0.066 -2.8
County 2.533 2.547 0.014 0.55
State 2.794 2.875 0.081 2.89
Source: California Department of Finance and U.S. Census 2000
59
San Luis Obispo Housing Element,March 30,2004
Changes in household types clearly reflect community transformation since 1990. As shown in
Table A-10, the percentage of City households occupied by single persons has grown by almost
18 percent, while during the same period, the percent of households with married couples or
families has decreased by about 11 percent. The number of single parent households and non-
family households with two or more persons has remained relatively unchanged. The City has
about twice as many non-family households with two or more persons as the County, and almost
three times as many as that number in California as a whole. This ratio reflects the City's high
concentration of student households and the difficulty faced by many couples and families in
finding affordable housing in San Luis Obispo.
Table A-10
Households by Type, Percent of Total Households 1990—2000
San Luis Obispo City,, County and State of California
Household Type,Percent of Total
1 Person Change Single with Change Non-family, 2 or Change Married Change
dependents more couples,
families
1990 2000 % 1990 2000 % 1990 2000 % 1990 2000 %u
city 28 33 17.8 10 10 0 27 26 -3.7 35 31 -11.4
Coun 24 26 8.3 12 13 8.3 11 11 0 53 50 -6
State 23 24 4.3 16 17 6.3 8 8 0 53 51 -3.8
Source: U.S.Census 2000. Percentages may not total 100%due to rounding.
b) Household Income
The U.S. Census differentiates between a "household" and a "family." As used here, the term
"family" means two or more related persons living together as a unit. This may include single
parents, children and extended family members (e.g., grandparents). A "household" includes
unrelated persons (e.g., single persons, roommates, and unmarried persons who live together), as
well as households falling under the"family" definition.
Table A-11 shows U.S. Census figures for median household and family incomes in the City,
San Luis Obispo County, State and other selected California counties. Despite significant growth
in personal income in the last decade, San Luis Obispo City and County median household
incomes continue to lag behind other Central Coast counties and the Los Angeles area.
Moreover, Household and family income growth has not kept pace with rapidly escalating
60
San Luis Obispo Housing Element,March 30,2004
housing costs. This disparity between income and housing costs helps explain why San Luis
Obispo frequently ranks among the most expensive housing markets in the nation.
Table A-11
Median Household and Family Incomes, 1989 and 1999
San Luis Obispo City, County, State of California and selected California
Counties*
Median Median Change Median Median Change in
Household Household in Income Family Family Income
Income, Income, Income, Income,
1989 1999 1989 1999
($) ($) ($) % ($) ($) ($) %
City 25,982 31,926 5,944 23 39,769 56,319 16,550 42
County of 3 1,164 42,428 11,264 36 37,086 52,447 15,361 41
S.L.O.
Santa 35,677 46,677 11,000 31 41,289 54,042 12,753 31
Barbara
County
Monterey 33,520 48,305 14,785 44 36,223 51,169 14,946 41
County
Los 34,965 42,189 7,229 21 39,038 46,452 7,414 19
Angeles
Coun
California 35,798 47,493 11,695 33 40,559 53,025 12,466 31
Source: U.S. Census, 19990 and 2000
'Figures for a four-person family or household.
San Luis Obispo City households tend to have lower incomes and pay a larger portion of their
income for mortgages or rent than San Luis Obispo County residents as a whole. Moreover,
median household incomes in the City have grown more slowly since 1989, relative to median
household incomes in the County. In 1989, the City's median household income was $25,982, or
about 83 percent of the countywide median. In 1999, the City's median household income was
$31,926, or about 75 percent of the County median household income.
Another income measure is per capita income, as shown in Table A-12. In 1989, the per capita
income in the City was $14,760, compared with a per capita income in the County of$15,237.
For the same year, the per capita income for California residents as a whole was $16,409.
61
San Luis Obispo Housing Element,March 30,2004
Table A-12
Per Capita Incomes, 1989 and 1999
San Luis Obispo City, Co nty, and State of California
Per Capita Income, Per Capita Income, Change($)
1989 1999
1 (S) (5) ($) %
City 14,760 20,386 5,626 38
County 15,237 21,864 6,627 43
State 16,409 22,711 6,302 38
Source: U.S.Census, 1990 and 2000
The State of California defines four income categories for the purposes of determining housing
affordability and need in communities. These categories are as shown in Table A-13. This
method is consistent with definitions of very low-, low- and moderate-income households as
used in some,Federal and most State housing programs; however, HUD (U.S. Department of
Housing and Urban Development) applies different standards for Community Development
Block Grant, Section 202 and other Federal grant programs.
Table A-13
State Income Categories
Income Category % of County Median Income
Very Low Income 50%or Less
Low Income 51%to 80 %
Moderate 81%to 120%
Above Moderate 121%or Higher
Source: California State Department of Housing and Community Development
Between 1989 and 1999, household incomes in San Luis Obispo increased significantly,
following trends at both regional and statewide levels. Table A-14 shows the estimated number
of households in the City of San Luis Obispo within each of the State income categories. The
table indicates that in 2000, over one-third of the City's household fell into the low- and very
low-income categories, while over one-half of the households were in the above-moderate
category, with annual incomes of over $57,600. Only 10 percent of the City's households fell
into the moderate category, probably reflecting the difficulty of finding affordable housing for
62
San Luis Obispo Housing Element, March 30,2004
sale to this income group.
Table A-14
Households by State Income Categories, 1999, San Luis Obispo City
Income Categories #of Households _ %of Total Households
Very Low(<$24,001) 6,631 29
Low($24,001-38,400) 1,154 6
Moderate ($38,401-57,600) 1,789 10
Above Moderate ($57,600+) 9,082 55
Total 18,656 100
Source: Extrapolation from 2000 Census for Income,All Households,and 2000 City Affordable Housing Standards.
Table A-15 compares the City, County and State by the numbers of households below poverty
level by type. Household "poverty threshold" is a measure established by the Federal
government that takes into account family size, number of persons under 18 years old and
income. For example, the poverty threshold in 1999 for a single person was $8,500, for a couple
was $10,869, and for a family of four was $17,184. Poverty thresholds are not adjusted for
regional, State or local variations in the cost of living or earnings. Very-low and low-income
households often require subsidies, combined with below-market rates or sales prices, to afford
housing in relatively high-cost areas such as San Luis Obispo.
Table A-15
Households Below Poverty Level by Household Type, 1999
Married Male Female Non-Family Total'
Couple Households Households
Families
#of % #of % #of % #of % #of %
persons s persons ersons persons
City 213 4.7 78 1.7 264 5.8 3,974 87.7 4,529 100
'N=18,656
County 2000 18.2 399 3.6 1,592 14.5 6,955 63.5 10,946 100
N=92,732
State 407,637 29.9 88,216 1 6.4 350,138 25.7 514,293 37.8 1,360,284 100
N=11,512,020
Source: U.S. Census,2000. Totals may not add to 100%due to rounding.
Universe: households in 1999 with income below poverty level.
"N"refers to the total number of households by jurisdiction.
63
San Luis Obispo Housing Element, March 30,2004
According to the 2000 Census, the percentage of City households with incomes below the
poverty threshold is about twice that of the County or the State. In 1999 about 24 percent of the
City's households had incomes below the Federal poverty threshold, compared with about 12
percent for both the County and the State. Non-family households comprise about 88 percent of
the City's households below the poverty threshold, and of these, about 24 percent consisted of
persons under 25 years of age, with households of persons 65 years or older making up about 26
percent of City households below the poverty threshold.
4. Housing Inventory and Market Factors
a) Housing Stock Profile and Population Growth
In the last decade, the City's housing stock grew more slowly than the population. Both housing
and population growth slowed markedly in the 1990s compared with the 1980s. The 1990 U.S.
Census counted 17,877 housing units in the City, with a vacancy rate of 5.5 percent. By 2000 the
City's housing stock grew to 19,340 units, with a vacancy rate of 3.6 percent, an increase of
1,463 units. This is a housing growth rate for the 1990s of just over eight percent, or an annual
average of about 0.8 percent. By contrast, in the 1980s the housing stock grew by 3,500 units,
an average annual increase of 350 dwellings, or 2.42 percent.
Between 1990 and 2000, the City's population grew from 41,958 to 44,148, an average annual
increase of 219 persons, or 0.52 percent. In the 1980s, the City added about 7,700 persons,
an average annual increase of 770 persons, or 2.25 percent.
64
San Luis Obispo Housing Element, March 30,2004
Figure A-1
Housing and Population Growth, 1980-2010
City of San Luis Obispo
,* l
8.000 1 _
7.000
r 0 Housing Units Added
■Pentons Added
ro .
• - yat,. rj r
5.000 - -- •' '
4.000
s�
z a
3.000 • - ...
2.000
1 :
x
+u3
1.000NI,
Y.
c
to-`�t� ."16+•a' 'Y'p�
0 '
1980-1990 1990-2000 2000-2010
Source: U.S.Census 2000 and City of San Luis Obispo,Community Development Department
65
San Luis Obispo Housing Element, March 30,2004
Table A-16 shows the net change in the number of dwellings due to completed construction
between 1995 and 2002, a period that cuts across a relatively strong housing development cycle
in the late 1990s, followed by a marked economic slowdown by 2000. During this period, an
average of 101 dwellings was built each year and 27 units were lost due to fire, demolition or
conversion to another use. Multi-family dwellings accounted for about 14 percent of all new
dwellings, compared with slightly over one-half of all new dwellings in the 1980s. This dramatic
reduction in multi-family projects (apartments and condominiums) has exacerbated the City's
shortage of affordable housing. Multi-family housing typically provides a wider variety of
housing costs and types than detached, single family housing. Yet most of the City's new
housing since 1995 has been single-family detached houses.
Table A-16
Residential Development, 1995 - 2002
Net Change Due to Completed Construction
number of dwellings)
Single Family` Multi-family Total Annual Growth Rate'
Year Market Rate Below Market Rates Below Non- for the year for three
Marker' Marker' exempt years
units
1995 50 0 -4 20 26 0.14%
1996 83 0 10 0 93 0.50%
1997 138 0 13 0 151 0.81% 0.48%
1998 132 0 10 0 142 0.76% 0.69%
19994 1 64 4 -9 0 55 0.29% 0.62%
2000 73 4 -14 41 14 0.07% 0.37%
2001 82 0 22 3 101 0.52% 0.29%
2002 69 0 25 0 94 0.48% 0.36%
Total 691 8 1 53 64 744 n/a n/a
Notes:
Based on California Department of Finance figures for total number of dwellings at the beginning of the year.
?,Under General Plan policy,very-low and low income units not included in Residential Growth Rate.
`Classification as to single-family or multi-family differs from previous reports,to conform to State and Federal housing-
type
ousingtype definitions.
Not reflected in the 1999 numbers are about 24 existing dwellings,mostly single-family,that were annexed as part of the
Fuller Road Area.
Negative number indicates the demolition or relocation of a dwelling outside the City.
Source: City of San Luis Obispo,Community Development Department
66
San Luis Obispo Housing Element, March 30,2004
b)Unit Type
San Luis Obispo's existing housing stock includes a wide range of dwellings, including
"Victorian-style," single-family houses near downtown, mobile home parks, duplexes, detached
single-family housing, condominiums and large, high-density apartment complexes close to the
Cal Poly University campus. Many of the City's older neighborhoods contain a mix of single
houses, houses with attached and detached secondary units, and small duplexes or triplexes.
Table A-17 summarizes the composition of the City's housing stock for 1990 and 2000.
Table A-17
Composition of Housing Stock by Unit Type, 1990 and 2000
City of San Luis Obis o
1990 2000
Unit Type #of Units % of Total #of Units % of
Total
Single-Family Detached 8,242 46 8,962 47
Single-Family Attached 1,123 6 1,210 6
Multi-Family(2-4 units) 2,227 12 2,347 12
Multi-Family(5+ units) 4,755 27 4,821 26
Mobile Homes, Other 1,530 9 1,531 9
Total 17,877 100 18,871 100
Source: Department of Finance Population and Housing Estimates,April 1990 and January 2000
As shown in the table, about 53 percent of San Luis Obispo's housing stock is categorized as
single-family, with 38 percent in the multi-family classification and nine percent consisting of
mobile homes. The distribution of unit types changed little during the decade, with single-family
detached homes showing a slight percentage increase.
c) Unit Size
Unit size is commonly described in terms of the number of bedrooms in a residence. Table A-18
summarizes the City's housing stock by number of bedrooms. Just over one-third of the City's
housing stock consists of two-bedroom units, with studio/one-bedroom units and three- bedroom
units each accounting for about one quarter of the total housing units. Four-bedroom and larger
dwellings comprise about 13 percent of the housing stock. Under the City's Affordable Housing
Standards, estimated occupancy is based on the number of bedrooms in a unit, as follows:
67
San Luis Obispo Housing Element,March 30,2004
• Studio unit: one-person household
• One-bedroom unit: two-person household
• Two-bedroom unit: three-person household
• Three-bedroom unit: four- and five-person household
• Four-bedroom unit: six-person household
It is interesting to note that unit size shifts markedly from owner-occupied to renter-occupied
housing. For example, the City's housing stock provides a sizeable proportion of housing units
with three or more bedrooms to accommodate larger households. As shown in the table,
however, most of these larger units are ownership units. Less than one quarter of the City's
rental housing stock has three or more bedrooms. Due to the relatively small proportion of
rental housing with three or four bedrooms and the high demand for student housing, it is very
difficult for families with four or more persons to secure rental housing. According to the 2000
Census, the City has only 181 units with five or more bedrooms, or less than one percent of the
housing stock.
Table A-18
Number of Bedrooms by Tenure, 2000
City of San Luis Obispo
Housing Size
0 and 1 2 bedrooms 3 bedrooms 4+bedrooms
bedroom
Tenure Total #of % of #of % of #of % of #of % of
Units Total Units Total Units Total Units Total
Owner- 7,795 410 5 2,386 31 3,481 45 1,518 19
occupied
Renter- 10,858 4,420 41 3,942 36 1,586 15 910 8
occupied
Total 18,653 4,830 26 6,328 34 5,067 27 2,428 13
Source: U.S.Census 2000
c) Tenure
Tenure refers to whether householders rent or own their dwelling. Most city residents are
renters. Almost 24,000 persons, or 56 percent of the population, rent in San Luis Obispo, a
significantly higher proportion than in the County and State. The proportion of renters and
homeowners has not changed significantly since 1990, even though most new construction since
1990 has been single-family housing. This may be explained, in part, by increased density in city
rental housing. As rents increase, higher density allows renters to hold individual rental costs
down. Also, in many older neighborhoods, many single-family houses have been converted to
68
San Luis Obispo Housing Element, March 30,2004
rental housing due to the strong demand for available rentals. Such conversions improve the
availability of rental housing, particularly for non-family households, but at the same time they
reduce the availability of older, for-sale housing often sought by first time homebuyers, couples,
and families.
d) Vacancy Rates
The housing vacancy rate is one measure of general housing availability. A low vacancy rate —
less than five percent, for example — suggests that households will have difficulty finding
housing within their price range. Conversely, a high vacancy rate may indicate either a high
number of housing units that are undesirable for occupancy, a high number of seasonal units, or
an oversupply of housing. By maintaining a "healthy" vacancy rate of between five and eight
percent, housing consumers have a wider choice of housing types and prices to choose from. As
vacancy rates drop, shortages generally raise housing costs and limit choices.
Since 1990, the City's vacancy rate has remained at just over five percent; however, in 2001-
2003, State Department of Finance figures show the rate dropped steeply to 3.46 percent. By
comparison, during the same period the County of San Luis Obispo vacancy rate has hovered at
around 11 percent, dropping to about 9.3 percent during the first three years of the new decade.
The City's consistently low vacancy rate reflects the high demand for rental housing near college
campuses (Cuesta College and Cal Poly University).
e) Age of Housing Stock
Housing age is one measure of housing stock condition and the need for rehabilitation. Older
units often do not meet current building or zoning standards, and without proper maintenance,
are more likely to need major repairs (e.g., new roof, plumbing and electrical repairs). Generally,
dwellings over 30 years of age fall into this category, and for purposes of the Housing Element,
the number of older dwellings is an indicator of the need for housing rehabilitation assistance.
Table A-19 shows the age of the City's housing stock by tenure.
Table A-19
Age of Housing Stock by Tenure, 2000
City of San Luis Obispo
Tenure
Year Built #of Units % of Units* Rental Owner Vacant
Before 1940 2,193 11.3 1,292 783 118
1940-1949 1,045 5.4 676 361 8
1950-1959 2.587 13.3 1,330 1,187 70
69
San Luis Obispo Housing Element, March.30,2004
1960-1969 3,035 15.6 1,659 1,265 111
1970-1979 5,245 27.1 3,502 1,599 144
1980-1989 3,436 17.7 1,722 1,581 1.33
1990-1994 934 4.8 430 475 29
1995-1998 649 3.3 164 485 0
1999-March 216 1.1 83 59 74
2000
Totals 19,340 100 10,858 7,795 687
Source: U.S.Census 2000.
*Does not total 100%due to rounding.
According to the 2000 Census, about 47 percent of the City's housing stock was built before
1970, and about 91 percent was built before 1990. By contrast, about 33 percent of the County's
housing stock was built before 1970, and 83 percent of County housing was built prior to 1990.
Both jurisdictions reflect a slowdown of housing production in the 1990s. Despite its high
proportion of pre-1970 housing, the City's housing stock .generally appears to be in good
condition. A City inventory of vacant, underutilized and blighted properties conducted in 2003
revealed approximately 44 residential properties with exterior signs of serious disrepair, building
condition or safety problems. The inventory was in all neighborhoods of the city; however, it
was limited to a visual inspection of the exterior street elevations and a portion of the side
elevations of housing units. It is likely that the number of substandard or dilapidated housing
units is much larger, based on the age of the housing stock.
In terms of tenure by year of construction, Census data indicate that the City's older housing
stock accounts for about 78 percent of the occupied rental housing. About 67 percent of the
owner-occupied housing was built before 1980.
g) Housing Condition
Another measure of the City's housing stock is housing condition. Housing is considered
substandard when conditions are below the minimum standards of living as defined by Section
1001 of the Uniform Housing Code. Households living in substandard housing may be exposed
to health or safety threats, which, in tum, could adversely affect the safety and quality of life of
neighborhoods. Such households are considered in need of housing assistance to convect any
serious health or building safety problems, such as structural, plumbing, mechanical or electrical
problems, and the presence of unhealthful conditions or materials, e.g. asbestos and lead-based
paint.
In addition to structural problems (sagging roofs, walls or porches, lack of or failing building
70
San Luis Obispo Housing Element,March 30,2004
foundation, termite infestation, etc.), the lack of certain basic facilities may also indicate
substandard conditions. According to the 2000 Census, there were 56 units in the City that
lacked complete plumbing facilities. Of these, 48 were renter occupied. For Census purposes,
complete plumbing facilities included: (1) hot and cold piped water; (2) a flush toilet; and (3) a
bathtub or shower. All three must be located inside a housing unit to be recognized as having full
plumbing facilities.
According to the Census, 307 units lacked complete kitchen facilities, and of these, 278 units
were renter-occupied. There were 148 units with no heating source, and 122 units that relied on
heating oil, kerosene, coal or wood for heating.
Based on City inventory, Census information, code enforcement and the age of units, it is
estimated that 2,000 multi-family dwellings are substandard and in need of major repair or
rehabilitation, or about 18 percent of the City's multi-family housing. Additionally, 1,000 single-
family dwellings are estimated to be substandard and in need of major repair or rehabilitation,
comprising about 13 percent of the City's single-family housing stock.
h) Sales Costs and Rents
The cost of rental and owner-occupied housing is generally higher in San Luis Obispo than in
most of the surrounding communities. The 2000 Census indicates the median gross rent in 2000
was $724, compared with $719 countywide, and $747 Statewide. Similarly, the median value
for owner-occupied homes in the City was $278,000, compared with $230,000 countywide and
$211.500 Statewide. Since 2000, rental and ownership housing costs have risen sharply.
According to San Luis Obispo Multiple Listing Service data for the second quarter of 2003, the
median-priced house in the City of San Luis Obispo costs $442,500, while in the County, the
median-priced house costs $378,120. In the same quarter in 2000, these prices were $256,500
and $221,500, respectively. This shows a 75 percent increase in median home sales prices in San
Luis Obispo in just three years.
Table A-20
Single Family Housing Values, 2000*
City and County of San Luis Obispo
City County
Price Range($) #of Units % of Total #of Units % of Total
Less than 100,000 1,127 14.4 6,350 11.1
1007000— 199,999 1,307 16.7 18,898 33.1
2009000—2499999 1,388 17.8 8,751 15.3
2509000—2999999 1,309 16.7 7,217 12.6
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San Luis Obispo Housing Element, March 30,2004
3009000—399,999 1,647 21.1 7,870 13.8
400,000—499,999 609 7.8 3,687 6.4
5007000—749,999 333 4.2 2,580 4.5
750,000 or more 75 0.9 1,639 2.8
Totals 56;992 100 7,795 100
Median value $230,000 $278,000
Source: U.S.Census 2000. *For specified,owner occupied housing
Existing and New Housing Sales Price Trends
Following a trend throughout much of California, and particularly the Central Coast of California
(from Ventura County to San Luis Obispo County), San Luis Obispo City has experienced a
steep increase in existing and new home prices since the late 1990s. During the early to mid-
1990s, housing costs in San Luis Obispo stabilized or showed a slight drop. A strong economy
in the late 1990s pushed housing costs up, with increased employment, higher Cal Poly
enrollment and greater housing demand. Since 2000, despite a nationwide economic slowdown,
the local and regional housing demand remains strong, buoyed by record low mortgage interest
rates and the San Luis Obispo area's attractiveness to retirees from both Southern and Northern
California. In this decade, home sales prices are expected to continue to rise, although at a
slower pace than in the period from 2000-2003.
Table A-20 lists the values of owner-occupied housing in San Luis Obispo City and County in
2000 based on homeowners' Census responses. Almost half of the City's homes were valued at
below $250,000, compared with about 60 percent of homes in the County. In 2003, home values
and sales prices for attached and detached single family housing rose dramatically, making it
difficult to find any housing for sale under $300,000. Although the total price of a home is an
important indicator of affordability, the primary affordability determinant is the monthly
payment. Lenders typically require homebuyers to demonstrate that the total monthly loan
payment, consisting of loan principal, interest, taxes and insurance will not exceed 30 percent of
gross monthly household income.
Table A-21 compares the monthly median income and median housing costs in San Luis Obispo
City, County and the State. As shown in Table-21, a mortgaged median-priced house would
require a household to spend about one quarter of its income on housing costs, while renters of a
median-priced unit would spend considerably more — about 41 percent of household income.
Given that most city residents are renters, this suggests that overpayment for rental housing is
common in San Luis Obispo. Ownership housing costs vary widely within the City, depending
upon location, size, amenities, length of ownership, and condition. Census data indicate the most
affordable areas in terms of housing value are Downtown, South Street and Laguna Lake areas.
72.
San Luis Obispo Housing Element,March 30, 2004
Table A-21
Median Monthly Owner Cost and Median Gross Rent As a
Percentage of Household Income, 1999
Ci and County of San Luis Obispo, State of California
Median Owner Cost,Percent of Household Median Renter Cost,
Income Percent of Income
Without
With Mortgage Mortgage
City 24.7 10 41.4
County 26.5 10 30.8
State 25.3 10 27.7
Source: U.S.Census 2000
Rental Costs
The 2000 Census reported that the median contract rent for all rental units in the City was $747
per month. Table A-22 shows the range of contract rents by unit type.
Table A-22
Dwelling Units by Rent Cost and Number of Bedrooms, 2000
Cityof San Luis Obis o
Range Studio 1-Bedroom 2-Bedroom 3+Bedrooms Total % of Total
$0-$499 442 586 460 451 1,939 18.0
$500-$749 781 1,533 953 420 3,687 34.1
$750-$999 122 499 1,442 247 2,310 21.3
$1000 or 89 338 878 1,316 2,621 24.3
more
No Cash 0 30 169 44 243 2.3
Rent
Total 1,434 2,986 3,902 2,478 10,800 100%
Source: U.S.Census 2000
Table A-22 shows that slightly over half of the rental units reported were in the $500 - $999
range, with the balance split between the higher and lower ranges. Table A-23 provides a
73
San Luis Obispo Housing Element,March 30,2004
snapshot of the range and average rents for a mix of rental housing types, including multi-family,
detached and attached single-family units. Rental costs were derived from commercial rental
property listings dated July 9, 2003, and included a total of 45 rental properties.
Table A-23
Range and Average Rent Costs, July 2003
Ci of San Luis Obispo
Studio 1-Bedroom 2-Bedroom 3-Bedroom
Range $600 - 675 $750 - $925 $925 - $1600 $1375 - $1950
Average $644 $838 $1,227 $1,706
Source: City of San Luis Obispo,Community Development Department
Affordability Gan Analysis
A disparity between monthly housing cost and monthly income is referred to as a housing
affordability gap. Housing affordability is determined by its cost and by the occupant's income
and other sources of purchasing power. All types of housing involve both initial or "move-in"
costs and continuing costs, such as rent or mortgage payments and maintenance. Although there
is no universally accepted definition of"affordability", it is sometimes described in terms of what
portion of household income should be spent on housing. According to the U.S. Department of
Housing and Urban Development (HUD), the California Department of Housing and Community
Development (HCD) and many lending institutions, households should spend no more than 30
percent (25 percent for very-low and low-income households) of their gross monthly income on
housing. It is not uncommon, however, for households to spend more than 30 percent of monthly
income for housing.
The costs of home ownership and renting can be analyzed by comparing a household's ability to
pay for housing, based on HUD's most current median income and current rent and sales costs.
Table A-24 compares the percentages of households spending 30 percent or more of their
monthly income on housing in the City, County and State. These figures indicate that renters pay
a substantially larger share of their income for housing than do homeowners. Moreover, renters
in San Luis Obispo City pay a larger share of their income for housing than do renters in the
County or the State.
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San Luis Obispo Housing Element, March 30, 2004
Table A-24
Comparison of Housing Cost as a Percentage of
Gross Monthly Income, 1989 and 1999
San Luis Obispo City and County, State
Jurisdiction % owner-occupied households % renter-occupied
paying 30% or more of income households paying 30%
for housing or more for housing
1989 1999 1989 1999
City 26.6 27.3 62.3 60.9
County 30.8 31.7 50.8 48.4
State 29.4 31.2 45.6 42.3
Source: 1990 and 2000 U. S.Census
According to the 2000 U.S. Census, among the City's renter households earning $20,000 to
$35,000 annually, 59 percent paid 30 percent or more of their income for housing. By
comparison, 55 percent of similar households in the County and 54 percent Statewide paid 30
percent or more of their income for housing.
Interestingly, Census shows the percentage of renter households spending more than 30 percent
of their income on housing has declined at the State, County and City levels since 1989, while
the percentage of homeowners paying over 30 percent of their income for housing has increased.
This may be due, in part, to improved economic conditions in the late 1990s that raised many
renter household incomes faster than rents, allowing renters to purchase housing.
Among homeowners, overpayment appears less prevalent but is still a factor affecting housing
opportunities. Homeowner cost figures in Table A-24 tend to understate housing costs for many
homeowners, however, because they include all ownership units, including those that are owned
free and clear, or those with very low mortgage payments. For example, of City households
earning $35,000 to $50,000 annually, 42 percent paid more than 30 percent of their income for
housing. In the County, 44 percent of households paid 30 percent or more of their annual income
for housing. Statewide,the percentage increases to 47 percent.
Table A-25 identifies the affordable rents and purchase prices by income category in July 2003,
based on a 30 percent maximum housing cost as a percentage of annual income. For ownership
housing, maximum affordable housing cost includes mortgage principal and interest payments
and an assumed 1.25 percent cost for taxes and homeowners' insurance. A 10 percent down
payment and 5.75% mortgage interest rate is assumed. In 2003, mortgage interest rates have
75
San Luis Obispo Housing Element,March 30,2004
reached record 30-year lows. As mortgage rates increase, the affordability gap will become more
pronounced.
Rental Units
A comparison of the average rent costs in Table A-23 with the maximum affordable rent costs
shown in Table A-25 indicates that in 2003, average rent for a studio apartment was affordable
for a very-low income household, while average rent for a one-bedroom apartment was
affordable for a low-income household. In both instances, however, the analysis assumes the
renter is at the upper income limit and has sufficient resources to pay the typical first and last
month's deposit. Moreover, the limited size of a studio unit (approximately 450 square feet) is
suited to a two-person household at best. A very-low-income family or household of three or
more persons is essentially "priced out" of San Luis Obispo's rental market, and a low-income
family of four or more persons generally cannot afford suitable rental housing. The average two-
and three-bedroom rental unit is affordable for moderate- and above-moderate income families
and households.
Table A-25
Maximum Affordable Rent and Purchase Price
by Income Category, July 2003
City of San Luis Obispo
Income Category Annual Income' Maximum Estimated Maximum
Affordable Rent Affordable Purchase
Payment' Price3
Very Low(: 50%) $17,301 - $28,850 $721 $108,037
Low (51 —80%) $28,851 - $46,150 $1,154 $172,896
Moderate 81 - 120% $46,151 - $69,250 $1,731 $259,629
Above Moderate >120% >$69,251 >$1,731 >$259,629
Median $57,500 -- --
Based on HUD income limits for a four-person household, San Luis Obispo County,March 2003
2Calculated as 30%of income divided by 12 months.
3Assumes 10%down payment,a 5.75%mortgage interest rate, 1.25%taxes and insurance and 29%front ratio.
Source: City of San Luis Obispo,Community Development Department
Ownership Units
According to the UCSB Economic Forecast Project and California Association of Realtors, the
median selling price of a home in San Luis Obispo City in 2002 was $367,700, up 66 percent
from the 1999 median sales price of$221,300. During the same period, the median sales prices
of homes in San Luis Obispo County rose from $185,600 to $313,800 (69 percent), and the State
home sales prices rose from $217,600 to $313,100 (44 percent). That rapid rise in home prices
has continued in 2003, as mortgage interest rates have dropped to 30-year lows, expanding the
76
San Luis Obispo Housing Element,March 30,2004
purchasing power of homebuyers and further contributing to housing demand. According to
local realtors, a large number of homebuyers in San Luis Obispo are from outside San Luis
Obispo, primarily Southern California and the San Francisco Bay Area. Retirees and so-called
"baby boomers" nearing retirement age are attracted to the Central Coast and are buying homes
and property with equity from selling properties in more urbanized areas.
Another component of San Luis Obispo's strong housing market are the parents of Cal Poly
University students who buy property initially to provide housing for their children as rental
housing, with possible future use as income property or for retirement. As a result, San Luis
Obispo's real estate market, perhaps more than ever before, is driven by demand and prices from
outside the area. As home prices have risen with increased demand, overall job growth has been
stagnant or has declined since peaking in 1997, and on the average, County incomes have grown
slowly. For example, according to State figures, average salaries in San Luis Obispo County
between 2001 and 2002 grew by a mere 1.6 percent for all employment sectors. As a result,
residents have found it increasingly difficult to find affordable housing, even for what would be
considered "starter housing" or "fixer uppers." Those on fixed incomes cannot afford to "trade
down" for smaller housing and allow recycling of these.homes for families.
Table A-25 indicates that only above-moderate income families and households can afford a
median-priced home in the City, and suggests that housing ownership is out of reach for all but
about 23 percent of San Luis Obispo households earning $75,000 or more per year. This is
particularly true for first-time homebuyers, single-parent families, lower-income persons engaged
in service or agricultural industries, and those on fixed incomes.
5. Summary and Conclusions
Appendix A describes the demographic factors affecting San Luis Obispo's housing market in
2003. They are:
q Population and household growth. Population growth has slowed significantly since the
1980s. The City's population grew by about 7,700 persons during the 80s, or just over
two percent per year. During the 1990s, the City added about 24200 persons, at an
average rate of half a percent annually. By 2008, the San Luis Obispo Council of
Governments estimates a City population of 46,110, while the City General Plan
anticipates a population of 50,446, with an average :annual growth rate of about one
percent.
• Household size. The City's average household size declined slightly during the 1990s.
The percentage of households occupied by single persons grew by almost 18 percent,
while the percent of households with married couples or families decreased by about 11
percent. The number of single-parent and non-family households with two or more
persons remained essentially unchanged.
77
San Luis Obispo Housing Element, March 30,2004
• Household income. Despite significant growth in personal income during the last decade,
San Luis Obispo City and County median household incomes continue to lag behind
other Central Coast counties and large urban areas to the north and south. In 1999, 24
percent of City households had incomes below poverty level — about twice that of the
City and State.
• Age distribution. Compared with the County and State, San Luis Obispo has significantly
lower percentages of teens and children, and adults in the primary childbearing years of
25-44. Persons 60 years or older comprise a slightly smaller percentage of the City's
population than in the County, but reflect the State's overall percentage for this age
group. The City's percentage of young adults ages 20 - 24 is almost three times larger
than the county as a whole, and almost four times larger than this age group's percentage
of the State's total population. During the 1990s, pre-school and kindergarten enrollment
was stable, while overall elementary school enrollment declined.
•
Ethnicity. About 16 percent of City and County of San Luis Obispo residents are non-
white, compared with about 40 percent of the State's population.
• Employment. Unemployment has declined in San Luis Obispo County since 1993.
However, job growth slowed from 2001 to 2003 in all employment sectors except
agriculture. Large city employers downsized, reducing their workforces by over 1,000
employees in 2002. The City's economy is expected to continue to remain strong in the
decade, however, with slow, steady job growth and low unemployment, but personal
income is expected to grow more slowly in the 2000s than in the previous decade.
• Housinp Unit Size. Just over one-third of the City's housing stock consists of two-
bedroom units, with studio/one-bedroom units and three-bedroom units each accounting
for about one quarter of the total housing units. Four-bedroom and larger dwellings
comprise about 13 percent of the housing stock. It is interesting to note that_unit size
shifts markedly from owner-occupied to renter-occupied housing.
• Housing Affordability. Many people who live in San Luis Obispo overpay for housing,
and many who work here cannot afford to live here. This is particularly true for first-time
homebuyers, single-parent families, and lower income persons engaged in service or
agricultural industries. For example, a very low-income family or household of three or
more persons is essentially "priced out" of San Luis Obispo's rental housing market, and
a low-income family of four or more persons generally cannot afford rental housing with
two or more bedrooms. The average two- and three-bedroom rental unit is affordable for
moderate- and above-moderate income families and households. Only above- moderate
income families and households can afford a median-priced home in the City, suggesting
that ownership housing is out of reach for all but about 23 percent of San Luis Obispo
households earning$75,000 or more per year.
78
San Luis Obispo Housing Element, March 30, 2004
Appendix B
Housing Needs
Appendix B describes housing needs relative to various segments of the population, including
groups with special housing needs. Several factors will shape the type and amount of housing
demand or "need" in San Luis Obispo. The main factors driving housing need during the
planning period are:
• Population and job growth, both in the City and in the County;
• Increased rate of household formation due to smaller households;
• Inability of very low-, low- and moderate-income working adults to find suitable
affordable housing near jobs;
• Growth of special needs groups such as the elderly, single-parent households, households
with disabled persons, and the homeless.
Analysis of the City's demographic factors suggests that while all but above-moderate income
households will continue to have difficulty finding suitable affordable housing, the largest gap
between housing supply and need will be for low- and moderate-income working people. First-
time homebuyers' assistance and incentives for multi-family housing will be critical tools in
addressing these needs.
1. Regional Housing Needs Assessment
Under State law, each city and county is to develop programs designed to meet its share of the
region's housing needs for all income groups, as determined by the region's council of
governments. The State Department of Housing and Community Development (HCD) identifies
housing needs for all regions of the State. Councils of governments then apportion the regional
housing need among their member jurisdictions. The Regional Housing Needs Allocation
(RHNA) process seeks to ensure that each jurisdiction accept responsibility, within its physical
and financial capability to do so, for the housing needs of its residents and for those people who
might reasonably be expected to move there. State housing law recognizes that housing need
allocations are goals that jurisdictions seek to achieve; however, they are not intended as
production quotas. The allocations are included in each jurisdiction's Housing Element so that
plans, policies and standards may be created to help meet housing needs within the Housing
Element's planning term.
a) Existing Housing Needs
That part of the RHNA process concerned with existing housing needs includes two
subcategories: overpayment and overcrowding.
79
San Luis Obispo Housing Element, March 30,2004
Households Overpaying for Housing
Overpayment refers to households paying more than 30 percent of their gross income to secure
adequate shelter. It is most common among very low- and low-income households, although
in high-cost housing markets such as San Luis Obispo, even moderate- and above-moderate
income households often pay more than 30 percent of their incomes to secure adequate
housing. However, high housing costs impact lower-income households most acutely because
lower- and fixed-income households must use a disproportionately higher percentage of their
incomes for housing and typically have the least financial flexibility. For these individuals,
the eventual result may be a series of financial problems leading to housing deterioration, as
limited funds must be used for more immediate needs, or the result may be an entire loss of
housing. For the community, it could mean overcrowding as households seek to maximize
income to meet housing costs, a visible decline in housing conditions and appearance,
neighborhood parking shortages and other related problems.
Overpayment for rental housing has been a continuing problem in San Luis Obispo. The 1990
Census indicated that in 1989, 62 percent of renter households paid more than 30 percent of their
income for housing, while 20 percent of owner households paid more than 30 percent.
Countywide, very low and low-income households also have a higher incidence of overpaying
for housing, with many paying more than one-half of their incomes for housing, a level referred
to by HUD a"severe cost burden."
Census 2000 indicates that in 1999, 61 percent of the City's 10,858 renter households, or about
6,600 households, overpaid for housing. The figures also show that of the City's 4,243
homeowners with home mortgages, 37 percent, or 1,550 households, overpaid for housing. This
translates into an estimated 8,150 San Luis Obispo households paying more than 30 percent of
their gross income for housing. For some, overpaying is a choice to secure housing of a certain
type, location or quality. For many others, it is a necessity to meet basic housing needs.
However, in San Luis Obispo, overpayment figures may be misleading. On one hand, the
percentage of households overpaying may significantly understate the problem, since high
housing costs force many to seek affordable housing outside the City. Those unable to afford any
housing in San Luis Obispo are not reflected in the figures. Conversely, the numbers may
overstate the problem in that many San Luis Obispo renters are students. Most student
households, including families headed by students, are nominally in the lower income categories
but have buying power due to parental support, loans or savings that is not reflected in their
current income levels. Nevertheless, rising housing costs and relatively slow income growth are
well documented, affirming that overpayment is a serious and ongoing problem in San Luis
Obispo.
Overcrowding
High housing prices often force lower-income households to accept smaller housing units,
8o
San Luis Obispo Housing Element, March 30,2004
resulting in overcrowding. Overcrowding can have serious housing and neighborhood
consequences. It places additional demands on housing facilities, neighborhood parking,
community infrastructure and services, and can eventually contribute to deterioration of the
housing stock and the neighborhood.
The U.S. Census defines an overcrowded unit as one occupied by 1.01 persons or more per room
(excluding bathrooms). Historically, overcrowding has not been a problem in San Luis Obispo.
The 1990 Census figures showed that City and County overcrowding rates for renter-occupied
units were both relatively low compared with statewide figures - 10 and 11 percent, respectively,
compared with 20 percent Statewide. Only one percent of the City's owner-occupied units were
overcrowded, compared with three percent in the County of San Luis Obispo and six percent
Statewide.
Table B-1 compares overcrowding figures for the City and County of San Luis Obispo and the
State of California in 2000. Census data indicate that the percentages of overcrowded rental
units in the City and County have declined since 1990, from 10 and 11 percent to 7.5 and 10.1.
respectively. City and County figures for overcrowding remain relatively low compared to the
State. In San Luis Obispo, among the 10,858 renter households in 2000, an estimated 814
households were overcrowded. For owner-occupied housing, San Luis Obispo has significantly
fewer people per room than either the County or State, with almost 99 percent of households
averaging one person or fewer per room. About 100 of the City's 7,795 owner-occupied
households were overcrowded.
Table B-1
Residential Overcrowding in the City and County of San Luis Obispo,
and State of California, 2000
Percent of all renter-occupied housing Percent of all owner-occupied
units,by number of occupants per housing units,by number of
room Occupants Ver room
1.00 person 1.01- 1.50 1.51 1.00 person 1.01- 1.50 1.51
or fewer persons+ or fewer persons+
City 92.6 3.3 4.2 98.7 0.6 0.7
County 89.9 4.8 5.3 97.1 1.5 1.3
State 76.1 8.5 15.4 91.4 4.3 4.3
Source: U.S. Census 2000
Another measure of residential overcrowding is the number of persons per occupied housing
unit, or average household size. In 1990, the U.S. Census showed an average of 2.39 persons per
occupied rental housing unit in the City of San Luis Obispo, compared with 2.53 and 2.79 in the
County and State, respectively. According to Census 2000, average household size in the City
81
San Luis Obispo Housing Element,March 30,2004
declined slightly from 1990 levels. Table B-2 compares average household size between the
City.. County and State in 2000.
Table B-2
Average Household Size by Tenure, in the City and County of San Luis
Obis o, and State of California, 2000
. :Reater.'Occn ied;; .Owner_Oecu fed-
Ci
ed Ci ty 2.19 persons 2.37 2.27
County 2.41 2.55 2.49
State 2.78 2.95 2.87
Source: U.S.Census 2000
Overcrowding has been a concern due to students or other groups of unrelated adults sharing
housing in low- and medium-density (R-1 and R-2) residential neighborhoods. Concerns
centered on the fact that most detached houses in R-1 and R-2 neighborhoods were not designed
to accommodate groups of adults, and that high occupancies can adversely affect persons living
under crowded conditions, reduce neighborhood parking, contribute to noise and privacy
conflicts, and can result in an overall reduction in the quality of life for City residents. In
response to these concerns, the City Council adopted an ordinance in February of 1990 that
requires households with six or more adult occupants in the R-1 and R-2 zones to secure
approval of an administrative use permit and meet standards related to parking, floor space per
individual, and number of bathrooms.
b) Housing Needs for 2001 —2009
In San Luis Obispo County, the San Luis Obispo County Council of Governments (SLOCOG) is
charged with allocating the region's assigned housing needs among seven cities and the
unincorporated County areas. The numbers supplied by the State's Department of Housing and
Community Development (HCD) are "goal numbers" and are not intended as production quotas.
State law recognizes that a jurisdiction's ability to meet regional housing needs within the
planning period maybe constrained by several factors. Government Code Section 65583 States:
"It is recognized that the total housing needs identified pursuant to subdivision (a) (i.e., through
the Regional Housing Needs Allocation, or RHNA process) may exceed available resources and
the community's ability to satisfy this need within the content of the general plan requirements
outlined in Government Code Sections 65300-65307. Under these circumstances, the quantified
objectives need not be identical to the total housing needs. "
Jurisdictions must accommodate the RHNA numbers in their Housing Elements or explain why
their quantified housing objectives differ and identify actions the jurisdiction will take to remove
constraints to achieving the R14NA number. These numbers apply to the planning term from
January 2001 to July 2009. Each jurisdiction's total need is broken down by income group.
These needs are then included in each jurisdiction's housing element as residential growth
82
San Luis Obispo Housing Element, March 30,2004
"targets" for which the jurisdiction tailors its plans, policies and standards to be accomplished
within the planning term.
On January 8, 2003, the San Luis Obispo Council of Governments approved San Luis Obispo
County's Regional Housing Needs Plan incorporating the State's Department of Housing and
Community Development (HCD) housing need determination of 18,035 new units for the
SLOCOG region. The Regional Housing Needs Plan was approved by HCD on March 11, 2003.
The approved Regional Housing Needs Plan is shown in Table B-3.
Table B-3
Regional Housing Needs Plan For the County of San Luis Obispo
January 2001 - July 2009
Housing Need Allocation
Very Low Low Moderate Above
Income Income Income Moderate Totals**
Units %* Units % Units % Units % Units %
Arroyo 310 26 223 19 259 22 400 34 1,192 6.6
Grande
Atascadero 345 25 254 19 304 22 456 34 1,359 7.5
Grover 178 26 142 21 166 24 200 29 686 3.8
Beach
Morro Bay 185 31 122 20 129 22 163 27 599 3.3
Paso Robles 627 28 467 21 520 23 652 29 2,266 12.6
Pismo 150 28 102 19 105 20 174 33 531 2.9
Beach
San Luis 1,484 34 844 19 870 20 1,185 27 4,383 24.3
Obispo
Unincor- 1,029 18 778 11 929 13 4,283 161 7,019 38.9
orated Co.
Totals 4,308 — 2,932 -- 3,282 -- 7,513 -- 18,035 100
Source: San Luis Obispo Council of Governments
'Percent of jurisdiction's total units
`*Percent of total County housing need. Total may not equal 100%due to rounding.
A jurisdiction's housing need allocation is the number of additional dwellings necessary to
accommodate expected growth in the number of households, and to: 1) replace expected
demolitions and conversions to non-residential use, 2) achieve an ideal vacancy rate (five to eight
percent) that allows adequate housing choice, and 3) avoid concentrating lower-income housing
in areas that already have disproportionately high proportions of lower income households. Total
housing need is broken down by household income categories used in State and Federal
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San Luis Obispo Housing Element,March 30, 2004
programs: very-low, low, moderate, and above-moderate income. As shown in Table B-3, San
Luis Obispo's allocation is 4,383 dwellings, almost one quarter of the County's total housing
need allocation.
2. Special Housing Needs
Certain segments of the population may have more difficulty finding decent, affordable housing
due to their specific circumstances. In San Luis Obispo, this may include elderly persons, large
families,female-headed households, the disabled,homeless and farm workers
a) Elderly Persons
Census 2000 shows that the City's proportion of seniors continues to increase. In 1980 the
percentage of City residents 65 years of age or older was 11.5, and by 1990 that figure increased
to 12.2 percent. In 2000, 12.3 percent, or roughly 5,400 city residents, were 65 year of age or
older, compared with 14.5 percent in the County and 10.5 percent Statewide.
Elderly persons may need regular medical care, special residential access features, home medical
equipment or trained medical care, transportation and opportunities to socialize. Those with
moderate- or above-moderate incomes can usually afford to accommodate those needs.
However, many elderly citizens have fixed or low incomes and do not own a home. They must
compete for rentals with other small households that may have greater financial resources, or
may have the potential for greater income in the future. Those low-income, elderly people who
do own homes may have difficulty affording property maintenance costs, or meeting special
accessibility or mobility needs such as ramps, handrails, door widths, counters and cupboard
height and design. Due to limited mobility or health issues, elderly people may have a more
difficult time meeting their personal needs, such as shopping, health or other errands, making
their housing locations especially important. According to Census figures, 1,152 elderly San
Luis Obispo residents — almost a quarter of city residents age 65 or older — have physical
disabilities, self-care or mobility limitations.
Table B-4
Elderly Mobility and Disability Status, 2000
City of San Luis Obispo
Disability % of Total % of Total
and Mobility Persons>65 Persons>65
Status Male years old Female years old Totals
Total #of 2,041 39.9 3,079 60.1 5,120 (100%)
persons> 65
years of age
Physical 187 3.6 253 4.9 440 (8.5%)
disability
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San Luis Obispo Housing Element,March 30,2004
only
Mobility 89 1.7 128 2.5 217 (4.2%)
limitation
only
Self-care 0 0 0 0 0
limitation
only
two or more 167 3.3 328 6.4 495 (9.7%)
limitations,
including
self-care
limitations
Totals 443 8.6 709 13.8 1,152
(22.4%)
Source: U.S.Census 2000
Elderly residents who own their homes are in relatively good positions financially. Given the
high cost of housing in the area, some could sell their homes for a profit and use it fora smaller
apartment or condominium, or for a residential care facility if needed. However, seniors on fixed
incomes with few assets have a more difficult time securing housing. Based on requests to the
City's Housing Authority for housing affordable to the elderly, there is a clear need for more
subsidized elderly housing in the City. With the aging of the so-called "baby-boom" generation
born in the 1950s, and with longer life expectancies; the need for suitable housing and related
services is expected to grow. According to Census 2000,233 elderly San Luis Obispo citizens
had incomes below the poverty threshold.
Residential CareFacilities
San Luis Obispo has a limited number of residential care facilities and special housing geared
toward the elderly. Residential care homes may also serve youths, adults, the disabled and those
in drug and alcohol recovery programs. In 2003 the City had 44 facilities providing housing for
special needs groups. Table B-5 summarizes special needs housing and residential care facilities
in San Luis Obispo in 2003.
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San Luis Obispo Housing Element, March 30,2004
Table B-5
Special Needs Housing and Residential Care Facilities, 2003
City of San Luis Obis2o
Xe of A
,otaLN e" i Total- A a
Group homes/shelters 6 115
Adult residential 2 22
-Disabled 6 280
Lame families 16 595
Elderly 12 1,338
Drug and alcohol 2 10
Total 44 2,360
Source: City of San Luis Obispo,Community Development Department
b) Large Families
According to the Census, 1,052 households, or about six percent of.San Luis Obispo's
households, consist of "large families." Large families are defined as households with five or
more persons, at least two of which are related by blood, marriage or adoption. Large families
are included as a special needs group because they typically require larger dwellings with more
bedrooms than typically needed by most households. Large families require dwellings with six or
more rooms, and of these, three or more are probably bedrooms.
According to the 2000 Census, the City's housing stock contained about 6,000 large dwellings
with six or more rooms, or 31 percent of the housing stock. Large families face the dual
challenge of finding an adequately sized dwelling at a cost that they can afford. These families
often have the largest affordability gap in securing housing among the special needs groups. This
is especially true for renter households, since most of the City's larger dwellings are owner
occupied. Of the City's roughly 7,500 dwellings with three or more bedrooms, two-thirds are
owner occupied. The remainder, about 2,500 large, rental housing units, is often priced for the
student housing market.
On a per-person rental basis, a three-bedroom house can often generate larger rents than if it were
rented to a single family. In 2000, over half of the large rental units were priced at $1,000 or
more per month. For low-income residents, the maximum affordable rent in 2000 was $783, and
for moderate-income residents it was $1,675.
It is evident from the Census that there is a sufficient number of large dwellings to accommodate
the numbers of large families in the City. However, data also show that lower-income
households are priced out of both the ownership and rental housing markets for that type of
housing. Moderate-income families may be able to afford rental costs for large dwellings;
however, a tight student-housing market makes it more difficult for families to secure large
dwellings. Large low- and moderate-income families will continue to be one of the most
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San Luis Obispo Housing Element, March 30,2004
seriously affected housing consumer groups in the City. Market-rate housing options for this
segment of the population are mostly overcrowded, multi-family units or poorly maintained
single-family houses. The production of more on-campus, student apartments could help to
make available more rental housing suitable for large families.
Table B-6
Large Households by Tenure, 2000
City of San Luis Obispo
Number of
Persons in Unit Owner Occupied Renter Occupied Total
Five 360 382 742
Six 126 131 257
Seven or More 18 35 53
Total 504 548 1,052
Percent of Total 2.7 2.9 5.6
Households
Source: U.S.Census 2000
Universe: Occupied housing units,N=18,653
c) Female-Headed Households
In 2000, females headed seven percent of the City's households, or an estimated 1,309
households with no husband present. By comparison, about 8.9 percent of county households
and 12.2 percent of State households are female-headed. Female-headed households are
included as a special needs group because of their low rate of homeownership, lower average
incomes and relatively high poverty rates. This group's housing needs are similar to those of
the elderly in that affordability, limited income and access to services are key concerns.
Female-headed households have space needs similar to two-parent households, but are at a
distinct disadvantage in competing for suitable housing with the financial resources of only one
adult. Often, the single parent must settle for a small dwelling that does not meet the
household's needs, or must spend a disproportionately large share of the household's monthly
income on housing and child care.
Housing close to employment, schools and services tends to be more desirable and therefore
more expensive. In their search for affordable housing, families are often forced to trade the
convenience of proximity for affordability. As the distance between work, school, daycare
and the grocery store is increased, so is the time spent connecting the stops, leaving less time
for the family to spend together, a particularly difficult situation for single-parent families.
Table B-7 shows the number of female-headed households in 2000. Of the total female-headed
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San Luis Obispo Housing Element, March 30,2004
households, 264 were listed as having incomes below the poverty level.
Table B-7
Female-headed Households, 2000
Cityof San Luis Obispo
Household Type . Total Percent of Total Households
Female-headed households(with own 688 3.7
children under 18 ears
Female-headed households (without 621 3.3
own children under 18 ears
Totals 1,309 7.0%
Source: U.S.Census 2000
Universe: All city households
Affordable housing needs of female-headed households can be addressed through rent assistance,
low- and moderate-income housing production, shared equity/down payment assistance and
group housing. Housing opportunities also can be improved through city policies calling for the
provision of affordable childcare, and by locating family-oriented housing developments close to
major employment areas, transportation facilities and shopping.
d) Disabled Persons
As shown in Table B-8, about 14 percent of City residents reported some type of disability on
the 2000 Census. Access and affordability are two major issues that may limit housing choices
for disabled people. This group is included as having special housing needs because the
disabled often need facilities not typically provided in conventional housing. Depending on
the disability, special accommodations may include specially designed interior features and
accessibility provisions outside the unit. California Administrative Code Title 24 sets access
and adaptability requirements for the physically handicapped, and these apply to most new
residential and commercial developments. The regulations require special architectural
features to meet the needs of disabled persons, including access ramps, accessible restrooms
and appropriately designed interior features. These requirements do not apply to single-family
residential construction.
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San Luis Obispo Housing Element, March 30,2004
Table B-8
Persons Reporting Mobility or Self-Care Limitations, 2000
City of San Luis Obispo
.. . - Mobility•- _ Self-Care--_ . Mobility and_.. _ % Of
Limitation Limitation Self-Care Population
Only Only Limitation Total =42,174)
Persons 16- 460 0 33 493 1.2
20
Persons 21- 2,969 12 341 3,322 7.9
64
Persons 65+ 1 1,504 0 495 1,999 4.7
Totals 4,933 12 869 5,814 13.8
Source: U.S.Census 2000
Universe: Civilian non-institutionalized population>five years.
Convalescent homes and assisted residential-care facilities provide limited medical care in an
institutional setting. They usually accommodate older residents and others who do not need
acute medical care but who cannot live independently. Since 1994 several new residential
care/assisted living facilities have been built, catering mainly to elderly and disabled persons.
These range in services from apartments for relatively independent living in a group setting to
residential care facilities with full, onsite support services, including personal and medical
care. As shown in Table B-5, San Luis Obispo has residential care facilities, apartments or
group homes that can accommodate about 1,618 elderly or disabled residents.
Other adults, who need less medical attention than is provided by a convalescent home, are
accommodated by an increasing number of small group homes (discussed below). Those with
multiple or severe disabilities, usually both physical and mental, require group living
arrangements where care and supervision can be provided. San Luis Obispo has one large
facility with about 90 occupants and one smaller facility for infants and young children. The
demand for such accommodations is expected to grow at about the same rate as the overall
population. Sites for large facilities of this type are limited in number, although moderate-
sized and smaller facilities could be accommodated in many residential areas throughout the
City.
Persons with mental or physical disabilities who do not need medical supervision but are not
able to live independently can usually be accommodated in large or small group homes. Small
residential care facilities typically accommodate between six and 12 people, and provide beds,
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San Luis Obispo Housing Element, March 30,2004
meals and 24-hour assistance by caregivers.
According to AIDS Support Network of San Luis Obispo, there are an estimated 75-100
persons in San Luis Obispo suffering from HIV/AIDS and related illnesses. Those suffering
from HIV/AIDS have specific supportive housing needs. The main housing problem for this
group is housing affordability, since in many cases, the HIV/AIDS patient can no longer hold
down a job. Mobility also is an issue, as a large percentage of this group is dependent upon
public transit. There are 12 apartments in San Luis Obispo (two facilities) exclusively for this
group, able to accommodate up to 24 persons, plus another eight units available through the
City of San Luis Obispo Housing Authority (with a capacity for 16 people), as available.
HIV/AIDS patients also live in public housing for very low- and low-income persons, through
the Housing Authority of the City of San Luis Obispo.
Those recovering from alcohol and other drug dependencies and those making the transition
from institutional environments to more independent living can benefit from sheltered and
supervised accommodations, or "transitional housing." San Luis Obispo has two such
facilities with about 10 occupants. Demand for additional facilities of this type can be met
through houses for six or fewer residents and additional medium-sized facilities. Under the
City's Zoning Regulations, such facilities are deemed "Adult Residential-care Facilities" and,
provided they are State-licensed, are permitted in all residential zones. Demand for such
facilities is expected to.grow at about the same rate as the overall population.
e) Homeless Persons
The homeless population in San Luis Obispo appears to be increasing, in part because of
increased visibility and changes in the make up of the homeless population. Historically, most
homeless people were young or middle-aged men, often with little education or with alcohol or
drug dependencies. However, in the last decade, homelessness in San Luis Obispo has become
more visible. Steeply rising housing costs, reductions in public assistance and other economic
changes have increased the number of homeless to include families with children and adults with
disabilities or chronic health problems. The growing shortage of rental housing affordable to
very low- and.low-income households further limits housing options for persons on the brink of
homelessness.
Homelessness is inherently difficult to quantify because it is often a transitional situation
dependent upon a household's or individual's changing economic condition or location. Lacking
permanent housing, homeless persons are often missed in census surveys and other community
inventories. While no formal surveys have been done on the number of homeless people living
in San Luis Obispo, it is possible to derive an estimate from the above service data. While small
homeless facilities recently have been established in North and South County, San Luis Obispo
remains the center of homeless services and facilities for the County.
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San Luis Obispo Housing Element, March 30,2004
According to the Economic Opportunity Commission of San Luis Obispo County (EOC), there
are an estimated 3,000 to 4,000 homeless persons in San Luis Obispo County, or about 1.2
percent of the County's population in 2000. The two largest facilities providing homeless
services in the County are located in San Luis Obispo: 1) the Maxine Lewis Memorial Homeless
Shelter, a 49-bed shelter that provides showers, clothes, evening meals, client mail and phone
services year-round, plus an additional 30 beds provided off-site through the Interfaith Coalition
for the Homeless, and 2)the Prado Day Center, which supplies lunch for an average of 83 people
each day and other services to over 90 people daily, with children comprising about 10 percent.
The magnitude of the homeless problem is evident from the number and range of services
provided. During 2002 the Homeless Shelter served 980 different people and provided 25,920
bed-nights of shelter. Each bed-night included a hot meal for the homeless guest, while an
additional 6,578 meals were served to people who were not staying at the shelter. On the
average, 70 people receive shelter nightly, and an additional 18 persons are given a free evening
meal. At the Prado Day Center, 958 homeless people were served, with a total of 30,547
homeless services provided during 2002. The Day Center provides a supportive environment for
individuals and families needing life services and a home base during the day; Clients have
onsite access to showers, phones, mail, daytime meals (through Peoples' Kitchen), laundry and a
range of public and private service providers, including job counselors.
Information provided by the San Luis Obispo Police Department and the Parks and Recreation
Department indicates that an unknown number of homeless people are living in cars, campers,
city creeks and open space areas and do not avail themselves of the homeless shelters. Homeless
service providers require that to receive services at the shelters, homeless persons must sign in
and must not be under the influence of drugs or alcohol. For these and other reasons, many
homeless people in San Luis Obispo remain invisible in terms of their numbers and the services
provided to them.
By comparison, in 1992, the SLO Homeless Shelter provided services to 861 different people and
an additional 581 others were served meals only. A total of 18,077 bed-nights of shelter were
provided in FY 1992, and 41,190 meals served. Another 779 others were provided with social
services through the Prado Day Center, with 4,435 units of service provided (client contacts for a
variety of referral, informational and advocacy purposes).
Transitional housing gives homeless people astable environment while they seek employment or
learn life skills towards self-sufficiency. In the last decade, San Luis Obispo has spent its entire
15 percent of CDBG public services funds each year on homeless services, yet existing facilities
cannot fully meet the need for shelter or services. Some of the unmet service and shelter needs
will be met by faith-based organizations and other service groups locally and in North and South
County that have begun to offer homeless support services,.using both public and private funding
sources and volunteer staffs.
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San Luis Obispo Housing Element, March 30,2004
The County's Consolidated Plan 2000 targets a Continuum of Care approach for addressing
homelessness on a regional basis. Each community,through the San Luis Obispo Urban County
Community Development Block Grant (CDBG) program, is encouraged to provide a range of
homeless services, including outreach and assessment, basic emergency shelter, emergency
services, counseling and case management and transitional and permanent housing. In 2003,
however, total funding available for public services (15 percent of total CDBG funding)
countywide is approximately $388,000 annually. This amount is not adequate to meet the
countywide need for homeless operating expenses or capital improvements.
fl Farm workers
The City of San Luis Obispo is in the County's central coastal agricultural region. San Luis
Obispo City is, for the most part, urbanized with only a few small farms still engaged in
agricultural production. According to the 2000 Census, about 0.9 percent of the City's labor
force over 16 years of age work in the agriculture, forestry, fishing and hunting industries, or
approximately 181 persons. Since less than one percent of the City's labor force works in
agriculture, it follows that few farm workers actually work or live in the City. The primary
factors with regard to farm worker housing are affordability, proximity to jobs and bi-lingual
services for predominantly Spanish-speaking residents. High housing costs make it extremely
difficult to meet farm worker housing needs in San Luis Obispo.
A 1993 study on farm worker housing in San Luis Obispo prepared by the People's Self-Help
Housing Corporation indicated that while there was some need for farm worker housing in the
City,the strongest needs for farm worker housing were in other, more predominantly agricultural
areas such as Paso Robles, Shandon, Nipomo and Arroyo Grande. In 2003, about 33 acres
remain in agricultural use within the City. The most intensive agricultural activity in the San
Luis Obispo area is located in the Edna Valley,just south of the City. In the last decade, this area
has experienced a rapid increase in wine grape production and has generated a need for
additional farm worker housing.
While the majority of farm worker housing needs will continue to be met in North and South
County areas closer to large farms, vineyards and ranches, there is still a need for an estimated
100 to 200 housing units suitable for farm worker families in San Luis Obispo during the
planning period. This need may be met through the development of additional very low income
public housing, mixed-, low- and moderate-income housing through the Inclusionary Housing
Program, and First-Time Homebuyer Assistance to provide gap loans and/or grants for low-
income families hoping to purchase housing.
g) Students
Cal Poly University and Cuesta College students comprise more than one quarter of the City's
population, and strongly influence the housing market. Although often grouped into low4ricome
categories statistically, many students can spend more on housing than income data suggests
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San Luis Obispo Housing Element,March 30,2004
because of parental support or larger household sizes. By pooling their housing funds, groups of
students can often afford more expensive housing than non-student households. This contributes
to higher rents in San Luis Obispo than in other parts of the County.
Student housing preferences sometimes result in competition and conflicts with other segments
of the City's population. About 3,800 students live on the Cal Poly University campus in
dormitories or apartments. Student housing complexes close to Cal Poly University have, since
the late 1990s, experienced high occupancy rates, prompting many students to seek alternative
housing arrangements outside the immediate campus area. Many students choose to find
apartments or condominiums elsewhere in the City, and increasingly, students choose to share
houses in single-family neighborhoods. The presence of students renting houses in
neighborhoods sometimes leads to complaints from surrounding property owners due to lifestyle
conflicts,parking congestion,noise and property maintenance concerns.
According to Cal Poly University, in 2003 about 17 percent of its students live in campus
residence halls, about 38 percent live in student-oriented apartments and fraternity houses within
a mile of campus. The other 45 percent, including married and graduate students, either find
housing elsewhere in the City of San Luis Obispo or in other communities throughout the
County. In fall 2002, about 12,300 Cal Poly students, or two-thirds of the University's total
enrollment of 18,453, lived in the City. According to Cuesta College, approximately 3,263
students, or 33 percent of total enrollment, made San Luis Obispo home in fall 2002. Hence, an
estimated 15,600 college students live in San Luis Obispo and comprised about 35 percent of the
City's January 2003 population
Student lifestyles -- and thus, housing needs -- often differ from those of non-student households.
Most Cal Poly students are young adults, have cars, many have part-time jobs, and most have
classes any time from early morning to late at night. To meet these needs, student-oriented
housing often includes: 1) a larger number of parking spaces in proportion to bedrooms than is
required for "traditional" family housing; 2) individual study areas; 3) proximity to Cal Poly or
transit; and 4) easy accessto food services, laundromats and recreational facilities.
Cal Poly University and Cuesta College students are, on the average, relatively affluent, and
many can afford housing that meets their needs., However, large apartment complexes in the City
designed specifically for students experienced higher than normal vacancy rates in the early- to
mid-1990s as many students chose instead to live in detached houses. Coming from family
homes, many young students prefer the appearance, space, flexibility and freedom offered by
detached houses, often located in "single-family neighborhoods." To afford rent, three or more
students often live together and share costs. This means that homes designed to meet the needs
of families are increasingly occupied by several unrelated adults. Because the homes were not
designed to meet student needs or lifestyles, conflicts with the neighborhood residents sometimes
arise. Common complaints are: 1) that there are too many cars on the rental property or parked on
the public street; 2) that renters cause excessive noise and hold activities, including parties, until
late at night, and 3)that the homes and grounds are not well maintained.
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San Luis Obispo Housing Element, March 30,2004
The Cal Poly Master Plan anticipates significant growth through 2008-2009, when the student
headcount is anticipated to reach 18,800 students, an increase of just under 2 percent. To help
meet expanding enrollment, Cal Poly opened 200 four-bedroom, on=campus apartments in fall
2003, and plans to build up to 900 apartments for a fall 2006 opening. In addition, 72
faculty/staff housing units are slated for development adjacent to the campus in 2004-2005.
These additional units should help reduce pressure on the City's rental housing market. And
while these new apartments will help to address housing needs generated by Cal Poly enrollment
growth during the planning period, they will not address the existing shortage of student housing.
Student housing will continue to be a major housing need in the City.
h) Fraternities and Sororities
Another important concern is meeting the housing needs of student fraternities and sororities.
"Greek" houses are allowed in medium-high- and high-density residential zones, with a Planning
Commission use permit. In 2003, there are six sororities and 18 fraternities that hold fraternal
events and maintain a presence in San Luis Obispo. Of these, all of the sororities and 14
fraternities occupy fraternal "houses" owned or rented by the organizations. These organizations
have about 1,300 members, and of these, about 250 to 300 members live in fraternal housing.
According to Cal Poly officials, it is likely that up to four fraternities and two sororities will be
seeking fraternal housing in the City within the planning period.
A decade ago, in 1993, 17 fraternities and sororities had use permits for houses within the City
Limits, housing approximately 430 students. Approximately 1,550 (down from 2,500 in 1993)
Cal Poly students belong to sororities or fraternities, or about nine percent of the student body.
Student interest in joining fraternal organizations, especially sororities, appears to be on the
upswing. As part of Greek activities, many Cal Poly fraternities and sororities actively
participate in beneficial university and community programs and events. In addition, they often
host meetings, recruitment activities and social events that can have a negative impact on their
neighbors. For example, on-street parking is affected, and noise and traffic levels often increase
due to frequent visits by non-residents attending fraternal activities. When Greek housing is
located close to non-student housing, compatibility conflicts sometimes arise.
There are few large sites available that could accommodate a new fraternity or sorority and still
satisfy parking and group meeting needs without posing neighborhood conflicts. Conflicts
between these organizations and other citizens are common -- partly because there has never
been a shared community consensus on a plan to guide the University, fraternities and sororities,
neighbors and the City in meeting this need. The solution may be, at least in part, to identify
appropriate locations for additional Greek housing on or near the Cal Poly campus. For several
years, various committees have devoted themselves to creating a "Greek Row" -- an area large
enough to house a number of sororities and fraternities in one place. The concept has wide
support in the community, but the possible locations all have drawbacks. A Community Housing
Task Force that included students, members of Cal Poly administration, the Mayor and other
citizens and City staffers identified several alternative locations for a Greek Row. Among those
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San Luis Obispo Housing Element, March 30,2004
were Cal Poly land, the Hathway neighborhood and conversion of existing student complexes
such as Mustang Village. The City intends to encourage "Greek housing" on the Cal Poly
University campus, and until that can be accomplished, or in R-3 and R-4 zones. A future Cal
Poly Village, a new on-campus residential complex expected to house up to 2,700 students, may
provide new opportunities to establish Greek housing.
i) "Shared" households
San Luis Obispo encourages a variety of housing types to meet varied lifestyles and needs.
Many people are looking for alternative ways to limit the amount of income they spend on
housing. U.S. Census figures for 2000 show that more unrelated adults are sharing houses than
ever before. In San Luis Obispo, the percentage of non-family households (households with one
or more non-relatives) is 45 percent, up 14 percent from 1990. In addition to saving money,
sharing a house also provides the benefits of companionship and security.
There appears to be substantial community interest in shared-housing opportunities such as
cooperatives or co-housing. Co-housing allows residents to live in their own private spaces and
share centralized dining, meeting and recreation facilities and services. Co-housing started in.
Denmark in the 1960s and has been gaining popularity in this country. Some of the obstacles to
providing co-housing in the City are the availability of sites, public acceptance of and the
possible need for exceptions to current standards to develop such a project.
3. Conclusions
Three general categories of housing needs are discussed in this section: existing needs, growth
needs and special needs. These are summarized in Table B-9.
Table B-9
Summary of Housing Needs, City of San Luis Obispo
2001 2009 Growth Needs A F `Special,Needs Gronps=
Very-Low income 19484 Elderly 5,400
units households
Low—income 844 Disabled persons 59814
units
Moderate-income 870 Large households 1,052
units
Above Moderate 19185 Female-headed 17309
income units households
TOTAL 4,383 Farm worker 100-200
households
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San Luis Obispo Housing Element,March 30,2004
Greek housing 6
sites
Overpaying Households Overcrowding
Renters 69600 Renters 814
OwnersE 11550 Owners 100
TOTAL 89150 TOTAL 914
The main findings of the needs analysis are:
• Overnayment. In 2000, 44 percent of all City households overpaid for housing. Among
low-income households (<$35,000/year), 52 percent of owner households overpaid and
78 percent of renters overpaid for housing.
• Overcrowding. Overcrowding appears to have declined in San Luis Obispo since 1990.
About eight percent of rental units are overcrowded, and just over one percent of owner-
occupied units are overcrowded.
• Large Families. In 2000, about five percent of City households, or 897 households, were
"large families" with five or more members, at least two of which were related. Large
dwellings, with six or more rooms, make up about one-third of the City's housing stock,
or 6,000 units. The majority of these units are owner-occupied.
• Female-headed Households. Female-headed households comprise seven percent of the
City's 18,656 households, or about 1,300 households. Of these, about one-half include
children under 18 years of age.
• Regional Housing Needs. San Luis Obispo's assigned regional housing need for the
planning period January 2001 —July 2009 is 4,383, broken down by household income
group as follows: Very Low— 1,484 units; Low-- 844 units; Moderate -- 870 units; and
Above Moderate— 1,185 units.
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San Luis Obispo Housing Element,March 30,2004
Appendix C
Housing Constraints and Resources
1. Governmental Constraints
Governmental constraints are the policies, standards, requirements, actions or fees imposed by
local, State or Federal governments to guide land use and development. Their purpose is to
ensure that communities are well planned, and to protect the health, safety and well being of all
residents. In achieving these ends, government rules may serve to constrain the construction rate,
amount or design of new housing. State law requires that governmental constraints on housing
be addressed in the Housing Element, with the goal of removing or modifying such constraints
where possible to encourage suitable housing. Within the City of San Luis Obispo, local building
and zoning regulations are the primary regulatory tools guiding development. Some regulations,
such as the Uniform Building Code and the California Environmental Quality Act, are State
mandated policies and standards implemented at the local level. Although State and Federal
agencies do play a role in the imposition of government constraints, these agencies are generally
beyond the influence of local government and are not analyzed in this document.
a) Land Use Controls
General Plan
By State law, all California cities must have a general plan to guide land use, transportation,
housing and other important facets of the community. The general plan is the foundation of all
local land use controls, and embodies the community's vision for an environmentally sound, life-
sustaining future. Seven mandated elements, or chapters, make up the general plan, plus optional
elements adopted by the jurisdiction to address special community concerns. Among these
elements, the land use element identifies the location, nature, distribution and character of land
uses in the City.
To implement the General Plan, the City uses a number of planning tools including Zoning
Regulations, Specific Plans, Subdivision Regulations, Community Design Guidelines, Historic
Preservation Program Guidelines and Parking and Driveway Standards. Property owners,
developers, architects and others use these standards in designing new housing developments.
The standards help explain the City's requirements and expectations, and are used by the City
when reviewing development proposals.
Policies outlined in the Land Use Element stipulate the amount, type and location of housing.
They also help establish the prevailing housing patterns and population density. Residential
zones account for over 40 percent of total zoned land area within City limits. The San Luis
97
San Luis Obispo Housing Element, March 30,2004
Obispo General Plan provides for four residential zones, plus nine zones where housing is
allowed with special approval. Table C-1 shows the land use zones that allow housing, their
existing acreage and the ranges of density allowed.
Table C-1
Land Use Categories Allowing Residential Uses
Cityof San Luis Obispo
Zone Description Acres in 2003 Max.Allowed Density,Density
Units/Net Acre
R-1 Low-density Residential 1,672 7
R-2 Medium-density Residential 497 12
R-3 Medium-high-density 166 18
Residential
R4 High-density Residential 24
172
C-C Community Commercial 912 36
C-D Downtown Commercial 45 36
formed "C-C"zone)
C-R General Commercial 166 36
C-N Neighborhood Commercial 51 12
C-T Tourist Commercial 205 12
C-S Commercial Service 461 123
M Manufacturing 186 12
O Office 169 12
C/OS Conservation/Open Space 1,812 one dwelling/five acres
'A Density Unit is equivalent to a two-bedroom dwelling. Other sized dwellings: Studio dwelling,0.5 DU;one-
bedroom dwelling,0.66 DU;three-bedroom, 1.5 DU;four or more bedrooms,2.00 DUs. Net acre refers to site
area minus dedicated right-of-way.
'Community Commercial is a new zone in 2003,and consists of large shopping centers.
31n combination with Mixed-Use (MU)overlay zone, up to 24 DU/acre allowed. 12 DU/acre considered likely
average density achieved.
General Plan policies encourage infill development to avoid sprawl, and also designate major
residential expansion areas outside city limits and within the Urban Reserve, the City's
anticipated urban limits at build out. The policies seek to balance residential development with
open space preservation and availability of urban services. According to the General Plan Land
98
San Luis Obispo Housing Element,March 30,2004
Use Element, a total of 24,300 dwellings is anticipated within the City by the year 2022,
accommodating approximately 57,200 persons. As of January 2003, the State Department of
Finance reported 19,558 dwellings in San Luis Obispo, housing a total of 44;359 persons.
b) Zoning Regulations and Development Standards
Zoning Regulations implement the City's General Plan land use policies. They establish specific
development standards, allowable land uses, performance standards and the permit process
necessary for the City's orderly development. Zoning regulations control development by
regulating allowed uses, and by development standards that set density, building setbacks,
building height, lot area and parking requirements. The regulations apply equally to mobile
homes, manufactured and site-built housing. Table C-2 summarizes residential zoning
development standards for San Luis Obispo. The standards are comparable to other
communities' requirements and ensure a quality living environment for all households,
regardless of tenure or income group.
Secondary Residential Units
Secondary residential units, or "granny flats", are permitted on legal, conforming lots in any
residential zone. Such units allow property owners to provide modest, affordable studio units by
right on legal, conforming residential lots. Also, several exceptions or variance procedures
possible in the "planned development" and ".specific plan"zones allow flexibility in site planning
and building design to encourage the development of housing for special needs groups, and to
provide density bonuses for projects which include affordable housing which meets or exceeds
City standards: Table C-3 lists some of the City's Flexible Development Standards to encourage
housing.
Energy Conservation
Compliance with Title 25 of the Califomia Administrative Code on the use of energy efficient
appliances and insulation has reduced energy demands resulting from new residential
development. The City's Energy Conservation Element, Subdivision and Zoning Regulations
promote energy-conserving design and placement of buildings, and Pacific Gas and Electric
offers public information and technical assistance to developers and residents on ways to
conserve energy in the home. City policies encourage alternative building designs that conserve
energy through passive and active solar features, "green"building technology and appropriate use
of landscaping to help reduce heat gain,preserve solar access, and provide windbreaks.
99
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Mixed Residential and Commercial Uses
Mixed residential and commercial uses are encouraged to allow for more housing in areas close
to jobs and employment centers, to exploit affordable infill housing opportunities and to promote
a compact, pedestrian- and transit-friendly urban structure. Dwellings are permitted in all
commercial zones with either a conditional use permit or Mixed-Use (MU) rezoning, including
office, service-commercial/light industrial and manufacturing zones. The application of an
"MV" overlay to any other zone allows the property owner to combine multiple uses, including
both residential and commercial sites. Application of the MU zone is a rezoning action.
Establishing new mixed uses requires use permit approval. In 2003, the City revised its zoning
regulations to allow live/work apartments in the C-S zone, and work/live apartments in either the
C-S or M zones. Previously, only caretaker quarters were allowed in these zones.
Parking Requirements
San Luis Obispo's car parking requirements are shown in Table C-2. The type and number of car
parking spaces varies by zone. Flexible parking requirements and design standards allow
developers to reduce parking by up to 30 percent for mixed-use developments. Flexible
standards also allow variety in parking locations, layouts and design in order to promote more
efficient and attractive use of residential sites. Bicycle and motorcycle parking also is also
required for multi-family housing at the rate of one motorcycle plus one bicycle space per 20 car
spaces.
Parking requirements indirectly constrain housing, especially in the Downtown Core where
parking is very limited. Because the Zoning Regulations require that parking be provided on the
same site as the use, this reduces the amount of land available for residential development.
While excessive parking requirements can unduly constrain housing, insufficient parking can
adversely affect residents' safety, quality of life and neighborhood compatibility. The City's
standards seek to establish a balance by allowing flexible requirements that can be tailored to
specific site conditions where necessary.
Much of the City's Downtown Core was developed in the late 19'' and early 20`' century when
automobile parking was not required. Many parcels in the C-D and C-R zones lack onsite
parking. The Downtown Core is the most intensively developed area of the City, and
development standards encourage 100 percent site utilization and a mix of commercial,
residential, cultural and governmental uses. In the C-D zone, parking is half of what is required
for residential use in other zones, and may be met by locating parking off site, within 500 feet of
the use, or by paying a fee in lieu of providing parking. The long-term strategy has been to build
public parking facilities on the edges of Downtown to encourage infill and intensification, use of
public transit and a more"pedestrian friendly" Downtown Core.
The C-D zone allows the highest density housing in the City. However, housing is difficult to
build, in part, because of the difficulty in providing parking. Downtown hotels (Anderson Hotel,
Granada Hotel, Winernan Hotel, Blackstone Hotel) were developed with little or no parking,
San Luis Obispo Housing Element,March 30,2004
while providing housing for tourists or residents without cars. 2000 Census figures show that
about seven percent of San Luis Obispo householders did not own a car. For those without cars,
or those who use cars infrequently, Downtown provides an alternative housing choice near
schools, shopping, nightlife,jobs and services. For those who do need cars, the possibility exists
for shared use of private or public downtown parking facilities. For example, some parking may
be available for rent in Downtown public parking facilities during evenings, when times of peak
parking demand do not coincide. Additional flexibility to allow very low or no parking
requirements for residents without cars and with adequate guarantees tied to occupancy, could
help expand this important housing resource.
Subdivision and Grading Regulations
Subdivision regulations determine how land is subdivided and set requirements for facilities such
as public streets and utility lines that serve the new subdivisions. Specific requirements for
materials and construction are adopted as.policy by the City, according to recommendations by
the City Engineer. Special limits and requirements are often set by the City Council when
approving individual subdivisions. The minimum lot size in residential zones is 6,000 square
feet, with minimum widths of 50 or 60 feet; however, exceptions to lot size and dimensions are
possible with City Council approval. As a special type of attached, ownership housing, the
Condominium Regulations set minimum standards for open-space, recreation, laundry facilities,
solar heating and storage that are higher than those applied to rental housing. The City's Grading
Regulations set limits and procedures for earth moving, generally to prevent mass recontouring
and erosion and to assure stable building sites.
Lot Size. Lot sizes and established neighborhood patterns influence the types of housing within
a community. Historically, most residential lots in San Luis Obispo ranged in size from 5,000 to
7,500 square feet, with about 6,000 square feet being common in newer subdivisions. The
subdivision of land into parcels of 6,000-10,000 square feet, regardless of allowed density, has
encouraged the development of low-density, detached housing. Reducing the minimum lot size
is often recommended as a means of increasing housing density and thereby reducing cost. It
does not necessarily follow, however, that small lots will result in more affordable housing.
There are many coastal resort communities in California with high-priced cottages on small lots.
In high-density residential areas, small lots may encourage the construction of detached, rather
than multi-family housing. Large parcels in medium-high and high-density residential zones
offer the best opportunities to encourage affordable housing. Larger parcels in San Luis Obispo,
even in low-density residential zones, are suitable for apartments and condominiums.
San Luis Obispo allows relatively small lots of 6,000 square feet in all residential zones, and has
the second highest residential density of the County's cities (after Grover Beach) with about
4,500 persons per square mile. It remains, however, one of the most expensive housing markets
in the County. Clearly, market demand strongly influences housing costs. And while the City's
lot pattern has been established in most areas, lot patterns in expansion areas are yet to be
determined, allowing the opportunity for a mix of residential densities and lot sizes.
103
San Luis Obispo Housing Element,March 30,2004
Land is a major component of housing costs in San Luis Obispo. In many of the City's older
neighborhoods, lot sizes of less than 6,000 square feet are common. While many housing
consumers prefer single, detached houses on 6,000-square-foot or larger lots, there also appears
to be a market for smaller, detached homes on relatively small (e.g. 4,000 to 4,500 square feet)
lots. Reducing lot areas, with a concomitant reduction in house size, is one strategy to reduce
housing costs for those desiring "starter housing," such as working couples and small families
just entering the housing market. In 2003 such development would require approval of a variance
or a planned development(PD)rezoning.
c) Specific Plans
As the name implies, specific plans guide the development of a defined area to implement the
general plan. Such plans can vary widely in terms of geographic area covered, degree of
specificity, and land uses addressed. As shown in Table C-4, the City has four expansion areas
Table C-4
Estimated Housing Capacity in Expansion Areas, 2003
Expansion Area Dvot1ling DwellingUnits
Orcutt 979
Margarita 868
Edna-Islay West 54
Minor Annexation Areas and Cal Poly' 2,091
TOTAL 3,992
'(Foothill Saddle, Luneta, CDF, Highland, Miossi, Alrita, Maino, Cal Poly, and other residential areas).
Includes approximately 900 student apartments on the Cal Poly Campus.
that, when annexed and fully developed, could potentially add 3,091 dwellings, plus student
apartments being developed on the Cal Poly University campus. Most of the City's large
residential developments will be located in designated expansion areas located outside the 1993
City limits but inside the Urban Reserve Line. Figure C-1 shows the location of future
residential areas outside the 1994 City limits. City policies require the preparation of specific
plans for each of the major expansion areas, with provisions for phased housing development.
Each area's phasing will be determined, in part, by the affordability of the dwellings, and by other
public benefits such as open space. The specific plan area committed to producing the largest
number of dwellings affordable to very low-or low-income residents generally will be developed
first.
104
San Luis Obispo Housing Element,March 30,2004
Figure C-1
Major Expansion Areas, 2003
Margarita Specific
Plan Area. The
Margarita Specific
Plan Area, slated for
about 870 new
dwellings, will be the
next major
expansion area to be
developed. The
Margarita Area
contains about 418
acres in the south-
central part of the
City's urban area.
The City has counted
on the Margarita
Area to provide a
large share of the
City's future housing
needs and to balance
projected job growth.
A draft Specific Plan
and EIR were made
available for public
review at the start of
2002. City action on
the long-awaited
Margarita Area
/%/Urtan Faseraa Line Specific Plan and
city (11 S.v) [01S 0111'1)0 lesdential Draft EIR is
Commcnnemunitydenelopmentdepartment OLIsaTo aD;odus<rial '
�L5e To Be Determirkd hl anticipated in 004,
with construction
starting in 2005.
Orcutt Expansion Area. The Orcutt Expansion Area covers about 231 acres in the southeastern
part of the urban area. Almost half of the area would be open space or parks. The rest would
accommodate up to 979 dwellings of various types, according to the specific Plan Draft prepared
in 2002 by a consultant retained by some of the property owners. During 2002, that consultant
and City staffers spent considerable time and effort working with all the Orcutt Area property
owners. In October 2002 the City Council endorsed a conceptual land use layout for the Orcutt
105
San Luis Obispo Housing Element,March 30,2004
Area, and directed staff to proceed with preparation of a Specific Plan and Environmental Impact
Report. A major issue emerging in planning for future residential development in the southern
part of the city is how additional elementary school enrollment will be accommodated, if a school
cannot be located in either the Margarita Area or the Orcutt Area, under policies adopted by the
independent Airport Land Use Commission.
d) Residential Growth Management Regulations
Quantified objectives anticipate the construction of 2,909 in-city dwellings during the planning
period. Of these, 53 percent, or about 2,170 units will be for very-low and low-income
households following the percentages of housing affordability in the City's RHNA number.
Very-low, low, and moderate income dwellings are exempt from the residential growth
regulations, as are infill housing, second dwelling units, and other residential development
outside designated Expansion areas.
Figure C-2
General Plan Anticipated Housing and Population Growth
City of San Luis-Obispo
Table 2: :anticipated Cite Population Grov►th
5d.9�0 57.20CU
60.000 -
49 45?..e sa,r�c
50.000 �z sv9 O :,G:)!uxi nate
40.000 ! ';laximum umt:er
30.��OC1
of Duelgs
-J CQ �� , . i2.2"" 23 MO 0 Anticipated
7 �30C
1 .iurn, l7a Fs Fie
19 2 7u-7 2002 213%' 2:12 2C1? 2 U
Source: City of San Luis Obispo General Plan Land Use Element
Estimated urban reserve capacity: 57,700(2)
Notes:
(1) Includes residents of group housing.
(2)Includes Cal Poly campus residents,who are inside the urban reserve but who were outside the City limits in
1994.
The Residential Growth Management Regulations will not prevent the City from achieving its
quantified objectives because they do not set a numeric cap on all housing. New housing for
very low-, low-income residents, and housing growth outside of expansion areas (such as infill
and intensification) are not regulated.
Figure C-2 shows the housing and population growth anticipated in the General Plan. General
Plan policies promote a balance of land uses to create a healthy, sustainable and resilient
106
San Luis Obispo Housing Element,March 30,2004
economic basis, protect the natural environment and promote housing that can accommodate all
income groups. The General Plan States that population growth should not increase more than
one percent per year, averaged over a 36-month period, until it reaches a buildout population of
57,200 persons in 2022.
To accomplish this objective, the City amended its Residential Growth Management Regulations
in 2000. The new regulations emphasized development phasing in major annexation areas as the
means to manage long-term residential growth. The regulations include a phasing plan showing
the number of new dwellings to be built in residential expansion areas during three-year
intervals. The plan is reviewed annually to allow for revisions and to respond to changes in
construction cycles. Revisions would allow allocations to be shifted among areas, or the phasing
intervals could be modified to better achieve housing goals. Table C-5 shows the phasing plan
adopted in 2002. The phasing plan will be updated in 2003-2004 to reflect the status of the
major expansion areas. As of January 2004, residential construction in the Margarita and Orcutt
areas has not yet begun.
In 2003 plans for the Margarita and Airport areas are nearing completion with approval expected
in 2004. Plans for the other major residential expansion project, the Orcutt Area, is in the early
stages of preparation. Housing construction in the Margarita Area is likely to start in 2005, with
the Orcutt Area expected to follow no sooner than 2008. Expansion areas that provide the most
affordable housing and other community benefits, such as open space protection, will receive
development priority.
Table C-5
Major Expansion Areas Phasing Plan, 2002
Source: City of San Luis Obispo,Community Development Department,August 2002
Notes:
Number of Dwellings Permitted(a, b)
Calendar years: 2002- 2005- 2008- 2011- 2014- 2017- 2020-
2004 2007 2010 2013 2016 2019 2022
Total
Assumed Demolitions -40 -30 -30 -30 -20 -20 -10 -180
Assumed New in-city(c) 110 100 100 100 100 100 100 710
Allowed Dalidio 0 180 0 0 0 0 0 180
Allowed Irish Hills North 80 0 0 0 0 0 0 80
Allowed Irish Hills South 86 0 0 0 0 0 0 86
Allowed Orcutt 70 90 215 235 30 0 0 640
Allowed Margarita 1 264 1235 310 303 0 0 0 1,112
Assumed Other annexations 20 30 30 30 30 30 30 200
Calculated Interval total: 590 605 625 638 140 110 120 2,828
Average annual% change(d) 1.00 1.00 1.00 0.99 0.22 0.17 0.18 0.69 (e)
(a) Dwellings affordable to residents with very low or low incomes,as defined in the Housing Element,are exempt.
107
San Luis Obispo Housing Element, March 30,2004
(b)This is a simple count of dwellings and is not meant to reflect the Zoning Regulation's method for calculating
fractional dwellings.
(c)Includes the incorporated area in 1994 and certain annexations during 1994- 1998(Stoneridge; Prefumo Homes;
and the El Capitan,Goldenrod and Fuller Road parts of the Edna-Islay Specific Plan,which has its own growth
management provisions).
(d)A calculated result:dwellings permitted(new construction minus demolitions),divided by three,divided by the
total number of dwellings projected to be in the city at the middle of the interval,times 100;assumes that the
maximum amounts are achieved in previous intervals.
(e)A calculated result:the compound growth rate that over 24 years would result in the total net increase.
The Airport Land Use Plan
The San Luis Obispo County Airport has a major influence on the community, particularly the
southern part of San Luis Obispo's urban area where most of City's residential growth is
planned. Under State law, a countywide, independent Airport Land Use Commission (ALUC)
adopts a plan identifying land uses that are compatible with present and future airport noise and
safety conditions. The area subject to this Airport Land Use Plan (ALUP) extends beyond the
City's designated airport specific plan area, and includes land under City and County jurisdiction.
Proposed specific plans and amendments to the General Plan and zoning must be referred to the
ALUC for a compatibility determination. The ALUC uses its plan as a basis for those
determinations. A four-fifths vote of the City Council and certain findings are required for the
City to override a finding of incompatibility. The City's General Plan calls for consistency with
the Airport Land Use Plan.
In June 2002, the ALUC adopted major amendments to its 1970s-vintage plan. The amendments
significantly reduced the number of residential units that could be built in the areas subject to the
plan. In most areas, the plan limits residential density to six dwellings per acre, well below
densities targeted by City plans. For example, the number of units planned for the Margarita
Area had to be reduced from 1,100 dwellings to 870 dwellings. Following the ALUC's action,
the City began to amend the Airport, Margarita and Orcutt Expansion Areas to reflect the
amended ALUP, and also amended the Zoning Regulations (as part of the proposed commercial
zoning update). According to State law, the City also must make its General Plan conform to the
amended ALUP, or create a special override. That task is expected to extend through 2004. The
main issues are anticipated to involve infill housing, uses that concentrate on young or elderly
occupants (such as schools and residential care facilities), and the provision of level, open areas
that can serve as emergency landing sites.
Density Bonus
The Affordable Housing Incentives allow a residential density bonus of at least 25 percent for
developers who build five or more dwellings with at least 20 percent of those units sold or rented
at prices affordable to low- or moderate-income people, or at least 10 percent of the units for
those in the very-low income category. Housing developments with at least 50 percent of the
units targeted for persons 62 years or older also qualify for a density bonus. Additional
incentives, including density bonuses greater than 25 percent, are available on a negotiable basis
in return for adding a higher percentage of affordable units..
108
San Luis Obispo Housing Element, March 30,2004
Secondary Dwelling Units
In 2003, in response to changes in State law, the City adopted new standards for secondary
residential units, or "granny flats." The new law requires local governments to allow these
secondary units administratively, without a public hearing or discretionary approval.
Additionally, the bill requires cities to create standards that will prevent adverse impacts on
historic resources. Cities may, however, create a detailed set of property development standards
including, but not limited to, parking, height, setback, lot coverage, architectural review,
maximum size and standards to prevent adverse impacts on historic preservation sites.
San Luis Obispo's secondary dwelling units (SDU) ordinance modifies or eliminates the
previous use permit requirement and discretionary review for SDUs, and allows attached or
detached SDUs on any legal, conforming and residentially zoned lot. Under the new provisions,
SDUs require only one parking space, and are reviewed by the City's planning staff to ensure
architectural compatibility. SDUs must conform to applicable zoning regulations such as height,
yards, parking and building coverage, and are limited to a maximum floor area of 450 square
feet. Performance standards to ensure neighborhood compatibility also were included in the
amended SDU regulations. SDUs are treated as an additional unit but are not taken into
consideration when calculating total allowed density on a site. Beginning in 2003, SDUs are
charged development impact fees as a"multi-family dwelling."
Manufactured and Modular Housing,Mobile Homes and Mobile Home Parks
Manufactured, modular and mobile homes offer economical alternatives to conventional, "stick-
built" housing. Manufactured homes are those built entirely in a factory under Federal building
codes administered by the U.S. Department Housing and Urban Development (HUD)..
Manufactured homes are then transported to the site as single- or multi-section homes and
installed on site. On-site additions, such as garages, decks and porches, add to the attractiveness
of the homes and must be built to local building codes. Modular housing describes factory- built
homes manufactured.specifically to the State, local or regional construction code requirements
wherever the home will be located. As with manufactured housing, the modular homes are
transported to their sites and installed. Mobile home is the term used for factory-built housing
produced before June 15, 1976, when the HUD construction codes took effect. Other types of
manufactured housing include panelized and pre-cut homes, in which factory-built homes are
shipped to the site in panels or as pre-cut"kits" for site assembly.
Industry advances in quality and design, as well as affordability, dramatically increased the
popularity of these housing types in the late 1990s. In 2000, according to the Manufactured
Housing Institute, 22 million Americans (about eight percent of the U.S. population) lived
fulltime in 10 million manufactured homes. In 2001 the industry shipped over 193,000 homes
from 275 manufacturing facilities nationwide. A manufactured home can cost anywhere from
one-third to one-half the cost of a conventional house. Architecturally, manufactured homes
include details and features that make the homes compatible with most residential neighborhoods
109
San Luis Obispo Housing Element,March 30,2004
and communities.
In 2003 California Department of Finance figures show that San Luis.Obispo had 1,501 mobile
homes, or about 7.6 percent of the City's housing stock. Mobile homes, placed on permanent
foundations and located outside mobile home parks, and manufactured (modular) housing are
treated the same as conventional site-built housing under the City's zoning, subdivision and
architectural review requirements. Therefore, all residentially zoned land is available for some
type of manufactured housing. Mobile-home parks are allowed with use-permit approval in all
residential zones. The City has few areas suitable for new, large mobile-home parks or for the
expansion of existing parks. However, expansion areas could accommodate mobile home parks
once they are annexed.
e) Architectural Review
Architectural review is required for all residential developments; except individual built, single-
family dwellings. The exception for single-family dwellings does not apply: (1) when
architectural review is required as a condition of a subdivision, use permit or other discretionary
entitlement; (2) when a developer proposes to construct three or more units; (3) when the City's
Community Development Director determines the site is sensitive as set forth in the procedures
document ("sensitive sites" shall include, but not be limited to, open space zoning areas
designated by resolution of the planning commission, architectural review commission or
council); (4) where the scale or character of a proposed dwelling contrasts significantly with
adjacent or neighboring structures; and (5) where any required parking spaces that are covered
are converted to another use and replacement parking is proposed.
San Luis Obispo has adopted Community Design Guidelines that describe the community's
expectations and preferences for the quality and character of new developments. The Guidelines
encourage design variety and innovation, and are intended to preserve San Luis Obispo's
distinctive character and sense of history. Depending upon the type and scale of the project,
architectural review can add, on the average, from two to four months of review time, including
study, public hearings and revisions. The additional holding time, from a development
standpoint, adds to development costs (interest costs, design/architectural fees, construction
delays) that are then passed through to housing buyers. For large residential projects, this cost
impact on an individual dwelling is lessened; however, on small projects, the cost can be a
significant factor in the overall purchase price of a home.
Most of the City's neighborhoods are an eclectic mix of architectural styles and character. In
many cases, small residential infill projects of four units or less can be integrated into
neighborhoods, on lots already zoned for residential use, without posing significant architectural
design or compatibility issues. The housing would need to comply with all zoning standards,
including setbacks, building height and lot coverage. By exempting small residential projects
from architectural review, the City could help reduce development costs and improve the
economic feasibility of constructing small detached or attached dwellings. On historic
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San Luis Obispo Housing Element,March 30,2004
properties, or where site constraints such as creeks, steep hillsides or lot shape required special
consideration, architectural review of the "sensitive site" may be appropriate. To help reduce
development costs, this Element calls for an amendment to the Municipal Code to exempt small
residential projects (four or less dwellings not on a sensitive site) from Architectural Review
Commission review. Most of these developments would be eligible for less costly and time-
consuming staff level architectural review.
f) Building and Zoning Code Enforcement
Code enforcement focuses mainly on zoning or building code violations that adversely affect
public health or safety, and on preserving neighborhoods. The code enforcement program
includes education, mitigation and prosecution issues, and has two components: 1) building and
zoning code enforcement, and 2) neighborhood services.
In addition to ensuring that new development is designed and constructed in conformance with
City standards for quality and safety, the Community Development Department also ensure that
property and land uses conform to those standards over time. The Department enforces the
City's land use, development, building and sign regulations through its Code Enforcement
Program. The Code Enforcement Coordinator is responsible for the resolution of any violations.
Table C-6 summarizes Code Enforcement complaints received in 2001.
The program is complaint-driven and handles about 400 cases per year. Upon receipt of a
complaint, a building inspector makes a preliminary site visit to verify the existence of a
violation; and informs the Code Enforcement Coordinator about conditions at the site. If a
violation exists, a"Notice of Violation" is issued and the necessary steps are taken to resolve the
problem. More complicated cases are set for abatement proceedings or, in some cases, criminal
prosecution.
Complaints about neighborhood overcrowding and illegal construction have accounted for the
majority of City building and zoning code enforcement cases. The illegal conversion of garages,
sheds, attics and shops to rental housing has contributed to substandard housing, parking.
violations, property maintenance complaints and other housing concerns. The City notifies
property owners in writing of specific conditions that must be addressed, and provides clear
direction on how to correct the violations. City staffers work with property owners to determine
whether the illegal construction can be upgraded and remain in place, or if steps are necessary to
remove any illegal or unsafe construction. Of these enforcement actions, less than one percent
actually resulted in displacing the current occupant.
San Luis Obispo Housing Element,March 30,2004
Table C-6
Code Enforcement Cases, 2001
City of San Luis Obispo
_ TYPES OF'C01t+IPLJIN`PS _ - Number of Cases-.
Garage Conversion 31
Substandard Housing 30
High-Occupancy Residential Use 9
Other 98
Signs 112
Converted Living Space 10
Home Occupations 15
Fence Height 12
Animals 2
Trailers 0
Noise 4
Fraternities/Sororities 4
Use In Wrong Zone 3
Building Code Violations 68
No Building Permit 78
TOTAL COMPLAINTS RECEIVED 476*
Source: City of San Luis Obispo,Community Development Department.
*Established cases may have multiple complaints.
Neighborhood Services. In 1999 the Office of Neighborhood Services (ONS) was established.
It is administered through the San Luis Obispo Police Department, and enforces Noise
Regulations, residential parking districts and Property Maintenance Standards. These standards
preserve the quality, character and condition of neighborhoods, and address the following issues
related to residential and neighborhood preservation: screening of storage and recreational
vehicles, front yard paving, use and maintenance of roofs, fencing, maintenance of buildings or
grounds and graffiti. In 2002 the ONS issued 2,777 noise violations and 504 notices for property
maintenance violations.
Through public information, community and educational programs, ONS works to improve
communications between students and other neighborhood groups, and sponsors special
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San Luis Obispo Housing Element,March 30,2004
neighborhood events, such as Good Neighbor Day and Neighborhood Cooperation Week. The
SNAP (Student-Neighborhood Assistance Program) and WIN (Working to Improve
Neighborhoods) Programs engage community volunteers, neighborhood groups and city staffers
in a working partnership to preserve and enhance neighborhoods.
Construction Codes
San Luis Obispo's construction codes are, with few exceptions, uniform codes enacted by the
State legislature and used throughout the State. They set forth health and safety standards for
structures, plumbing, electrical and fire prevention. The cost of meeting State construction codes
-- laws intended to make new housing safer, stronger, more energy efficient and resistant to fire
and earthquake hazards -- is ultimately passed on to housing consumers. In the long term, many
building standards can reduce ongoing housing costs through lower utility bills and reduced
insurance premiums.
In some cases, San Luis Obispo has adopted more stringent construction codes than mandated by
the State. Local Building Code amendments that could affect housing cost include the following:
1. Seismic Strengthening of Unreinforced Masonry (URM) Buildings. There are 126
unreinforced masonry buildings in San Luis Obispo, many of them historic. Of these, 10
include dwellings. All URM buildings have undergone structural analyses as required by
State law. City regulations require all URM buildings to be seismically strengthened by
2017. Strengthening involves improvements to building foundations, walls and roofs to
resist catastrophic damage and loss of life during an earthquake. Such improvements can be
expensive, ranging in cost from $50-$65 per square foot in 2003. Construction permit and
planning fees for URM replacement buildings are waived, and fees spent on seismic analysis
are credited toward architectural review, plan review or building permit fees for URM
strengthening projects. Pursuant to Council Resolution No. 8663 (1997 Series) establishing
an incentive program for URM strengthening, City offered to provide technical assistance in
forming a"voluntary assessment district" to assist financing of URM improvements and fire
sprinkler installation. Due to a lack of sufficient property owner interest, the volunteer
assessment district approach was not implemented.
URM strengthening or replacement costs may exceed property owners' financial capacity
and/ or force closure of buildings that do not generate sufficient income to support the
improvement costs. Affordable downtown housing may be particularly vulnerable in this
regard. Additional financial assistance and/or incentives may be necessary to meet the 2017
deadline and to preserve or provide affordable downtown housing; The City intends to seek
State and Federal grants as part of its 2004-2009 housing program initiatives to address this
important issue.
2. Construction in the downtown commercial fire zone must be of 5/8-inch Type X gypsum
wallboard, unless the building is equipped with an automatic fire extinguishing system
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San Luis Obispo Housing Element,March 30,2004
throughout. Additional material cost of the wallboard is not significant.
3. Due to expansive soils in the San Luis Obispo area, all residential foundations and slabs must
meet more stringent requirements;unless a soils report is provided to show that such upgrades
are not needed. The estimated cost for the foundation upgrade is approximately $2,500 per
dwelling.
4. Wood shake and shingle roofing materials are prohibited, unless the material is listed as a
Class A Assembly. Adopted by ordinance in 1983, this law is intended to reduce fire hazards
and the potential for loss of life and property from a major fire in the City. The ordinance
differs from State and County regulations in that they allow wood-shake roofing that meets a
minimum Class-C rating. Additional construction costs, if any, would depend on the builder's
choice of a roofing material.
5. An automatic fire extinguishing system is required in all new buildings except most buildings
that are 1,000 square feet or less. Initially adopted in 1990, the ordinance requiring fire
sprinklers in all residential occupancies is intended to reduce fire hazards to life and property,
to allow development where fire-flow, access or setback deficiencies might otherwise
preclude it, and to reduce ongoing public costs of fire suppression. The fire sprinkler
requirement adds about $3.00 per square foot to the cost of construction, or $6,000 for a
2,000-square-foot home. The added cost of fire sprinklers may be offset or recovered in the
long-term since:
1) Most insurance companies have reduced homeowner fire insurance rates for homes with
fire sprinklers.
2) Fire sprinklers add value to a home, and all or a portion of the costs can be recovered
upon resale.
3) During development, additional cost-saving allowances are made for buildings with fire
sprinklers (e.g., longer distances between fire hydrants serving a development; reduced
vehicle access requirements).
4) Fire-flow requirements are reduced by 50 percent, allowing the use of existing water
mains in most cases. This allows infill development where infrastructure deficiencies
might have otherwise prevented it.
Site Improvement Requirements
The City may require on- or off-site improvements such as streets, utilities, traffic signals and
landscaping as a condition of use permit, variance, subdivision or other land-use approval.
Dedication of right-of-way, public transit facilities, easements or access rights also may be
required. These improvements add costs that are usually passed on to the housing consumer..
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San Luis Obispo Housing Element, March 30,2004
This Housing Element includes policies which require the City to consider and minimize the
costs of imposing additional requirements on housing projects beyond those required by State
law, or necessary for public health, safety or welfare, and to periodically evaluate these.
requirements to determine if they are necessary to protect the public's health, safety or welfare.
Americans with Disabilities Act
The Fair Housing Act of 1998 and the Americans with Disabilities Act (ADA) are Federal laws
intended to help provide safe and accessible housing. The City is responsible for enforcing State
accessibility regulations (California Building Standards Code, Part 2, Title 24) when evaluating
new construction. Accessibility requirements of the California Building Code are similar to
Federal regulations and mandate that new developments be designed to ensure full accessibility
and use by the physically disabled. Single-family houses are exempt from these regulations.
Compliance with building code requirements may increase the cost of multi-family housing
production and rehabilitation. However, these regulations provide minimum standards that the
City must comply with in order to ensure safety and the appropriate levels of accessibility in new
developments. Difficult compliance situations may 'be reviewed by a city advisory body
appointed by the City Council to consider such matters.
Non-conforming Uses and Structures
Some dwellings are subject to premature deterioration and demolition because of their legal, non-
conforming status. A legal, non-conforming use or structure is one that was established with
permits, but is no longer allowed and could not be replaced under the current zoning regulations.
Examples include housing as a principal use in a manufacturing zone. Traditionally, lenders and
insurance carriers avoid lending or insuring project improvements for such non-conforming
dwellings.
An estimated 175 dwellings are considered non-conforming because of their location in the
manufacturing or service-commercial zones. Housing Element programs address this issue by
encouraging the conservation of non-conforming housing, and through programs that enable low-
income homeowners to rehabilitate substandard housing through low-interest loans or grants.
g) Processing and Permit Procedures
The development review process adds time and costs to a building project. The City's
development review procedures are designed to protect public health and safety, to simplify and
expedite the review process whenever possible, and to ensure that new development meets State
and local development standards within time limits set by State law. The Permit Streamlining
Act requires final City action within three months of adopting a negative declaration or
categorical exemption for a project, and within six months of the date a final Environmental
Impact Report (EIR) is certified for a project.
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San Luis Obispo Housing Element,March 30,2004
For most minor or relatively simple items which are exempt from environmental review, such as
administrative use permits, minor or incidental architectural review, minor subdivisions, and lot
line adjustments, the processing time from submittal to final action lasts approximately four to
six weeks. In San Luis Obispo, architectural review is required for multi-family projects and
residential subdivisions. More complex planning items requiring initial environmental studies
such as architectural review of new commercial, industrial and residential projects, conditional
use permits and variances (Planning Commission), planned development/rezoning or standard
subdivisions typically require eight to 12 weeks.
The City's most complex planning items include general plan amendments, rezoning,
annexations and zoning regulations text amendments. Any development project that requires an
EIR can take six months or longer from the date an application is filed to final City action.
Development review procedures, such as public notices, hearings and environmental reviews, are
mandated by State law and also add to the time needed for the approval of new housing projects.
Since 1994 the City has revised its zoning and subdivision requirements to simplify and speed
up development approvals. For housing developers, time is money. Efforts to reduce the time
required to process development applications can result in lower costs to the housing consumer.
Examples of permit streamlining actions the City has taken include:
• House relocation no longer requires a conditional use permit.
• Demolition or relocation of most buildings 50 years or older, but not historically listed,
no longer requires Cultural Heritage Committee historic significance review.
• Minor housing additions, remodels and seismic retrofits may be approved by City staff
as "minor or incidental" architectural review.
h) Development fees
Application and permit fees
Local governments levy fees and assessments to cover the cost of processing development
applications and permits, and to cover the cost of services. These fees help ensure high-quality
housing development and the provision of adequate public facilities and services. Development
fees are typically passed through to the consumer in the form of higher rents or sales prices for
new housing. Consequently, City fees increase development costs and affect housing
affordability. One method of evaluating whether San Luis Obispo's fees are excessive or pose
barriers to housing development is to compare its fees to those in other nearby jurisdictions.
In 2003 the City surveyed development fees for the County's seven cities, and for San Luis
Obispo County. The City also compared fees that the various jurisdictions would charge for a
commercial development and two residential development scenarios: a new 2,000-square-foot
house with a 500- square-foot garage, and a 10-lot, single-family residential subdivision. The
survey showed that for most development fees, San Luis Obispo is significantly higher than the
other county jurisdictions. Development fees are summarized in Table C-7, and comparative
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San Luis Obispo Housing Element,March 30,2004
development fees are shown for the development scenarios in Figure C-3.
In most cases, City development fees assume full cost recovery for actual costs to deliver the
planning, building and engineering services. Development review fees are updated annually,
based on changes in the Consumer Price Index.
Survey results show that San Luis Obispo development fees are generally higher than those of
other jurisdictions in San Luis Obispo County. However, the City waives most development fees
for affordable housing. City policies already exempt very low- and low-income housing from
most development review and permit fees. Housing Element Program 2.3.6 and 2.3.7 call for the
City to seek additional funding sources to help offset development-related City fees for
residential projects that include affordability guarantees for very-low, low- and moderate-income
households.
Table C-7
Com 3arative Develo ment Fee Sum ary, 20031
Fees Charged Arroyo Ataseadero Grover Morro Paso Pismo San Luis SLO
Grande Beach Bay Robles Beach Obispo County
Annexation! Cost+24% 2,500 3.000 Cost: 7,2432
Prezonin +cost hrl .ch
Appeals to 195 200 150 50%fee 100 500 0 484
Council/Board
Architectural 415 362 2,187
Review,Full
Architectural 220 851
Review,Minor or
Incidental
Certificate of 650 150 513 200 1,239 796
Compliance
Condominium 2,205 1,075 4.000 3,593
Conversion +hrly fee
EIR Contract 15%ofEIR 25%of Cost Cost+ 25%of
+hrly fee +hrly fee EIR +hrly fee 30% EIR
+hrlv fee +hrly fee
Environmental 15%of 312 1,500 520 1,994 25%of
Review/Initial EIR EIR
Stud
+hrly fee +hrly fee
General Plan 1.370 850 613 1,000 800 6,000 5,4622 4,000
Amendment +cost +cost note
Historic 0
Preservation
Review CHC
Lot Line 800 325 398 539 200 1,140 600
Adiustment
Lot Merger 605 55 41 188
Planned 1.155 512 1,200 3,295 6,783
Development
Permit/Rezoning
PD Amendment 1.155 482 600 1,405
Specific Plan— 4.000
Residential
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San Luis Obispo Housing Element,March 30,2004
Specific Plan 1,155 Cost 800 Cost 5,8252 4,000
Amendment +24% +hrly fee note
Street 550 200 4,2232 400
Abandonment
Tentative Parcel 1.000 865 521 1,282+ 1.300 1,800 5,321+ 2,200
Map 102 per 177 per lot note3
lot
Tent.Parcel Map 1.000 50% 2.070
Amendment
Tentative Tract 1.000 865 521 1,539+ 1.300 1,805+ 6,898+ 2,900
Map 205 per 115 per lot 177 per lot note}
lot
Use Permit, 150 190 295 235 656
Administrative
Use Permit, 1,205 550 174-8 �00 2503 1.450
Major PC
Source: City ot Sar Luis Obispo.Community Development Department
Notes:
'Table does not list all planning fees. Only those fees applicable.to residential development are included. Fees have
been rounded.
245%of full cost of time and materials
3With Initial Study
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San Luis Obispo Housing Element,March 30,2004
Figure C-3
Comparison of Development Fees for a 2,000-Square-Foot,
Single-Family House, 20031
$7,WO
25,WO
z
. .........
`T1
..........
"ZZ..
szow
...... . ..
....... .......
SUM
7-7
ISO
Atascade M Amp Gnwnde Pasta Robles Pismo Beach Grover Beach County of SLO MGM Say Son Luis Obispo San Luis Obispo
2
U
Source: City of San Luis Obispo,Community Deveibpmdnt Department
I San Luis Obispo I shows fees existing in April 2003, San Luis Obispo 2 reflects fee increase that took effect July
2003.
Development fees include planning application fees, building plan check and permit fees, and
Fire Department and Public Works Department plan check and inspection fees. For a 2,000-
square foot-house with a 500-square-foot garage and a construction value of $168,000,
development fees in San Luis Obispo in July 2003 totaled $7,496, or about 4.4 percent of
construction value. For the 10-lot, single-family residential subdivision, development fees
totaled $110,864, or 6.6 percent of construction valuation. By comparison, development fees for
the same hypothetical developments in the County of San Luis Obispo were $3,531 and $32,590,
respectively,plus hourly costs.
Development impact fees
Like many California cities, San Luis Obispo levies impact fees to help pay for the public costs
of new development. San Luis Obispo policies State that existing residents should not bear the
costs of new development. Impact fees ensure that new development pays its fair share of the
cost of constructing the water and sewer facilities, streets and other improvements necessary to
serve it. Impact fees are based solely on the capital costs attributable to new development. In
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San Luis Obispo Housing Element, March 30,2004
2003 the impact fees and approximate costs are shown in Table C-8.
Table C-8
Residential Development Impact Fees per Dwelling Unit, July 2003
City of San Luis Obispo
Impact Fee
S ecific Plan Area Surcharge
Development EDU* Citywide Airport, Dalidio, Irish Hills Orcutt
Type Margarita, Madonna,
and Edna- McBride
Islay**
Water
Single-Family 1.0 $8,259 $ 764 -- -- --
Multi-Family 0.8 6,607 611 -- -- --
Mobile Home 0.6 4,955 458 -- — --
Waste Water
Single-Family 1.0 $3,314 $ 746 $212 $376 $1,730
Multi-Family 0.8 2,651 583 170 301 1,384
Mobile Home 0.6 1,988 448 127 226 1,038
Transportation
Sin le-Famil 1.0 $1,491 -- -- -- --
Multi-Family 1.0 1 1,323 -- -- — --
Source: City of San Luis Obispo,Community Development Department
*EDU means Equivalent Density Units,multiplied times impact fee.
**Water surcharge does not apply in Edna-Islay Area
i) Infrastructure
The City is committed to living within its resources, while planning to meet the future resource
needs of its citizens. Residential development requires that adequate roads, drainage, water,
sewer, fire protection and other public services be available. Generally, the developer provides
facilities within or next to the development site, while the City is responsible for the facilities
that serve a larger area. For example, the City provides arterial streets, a sewer treatment plant
and main collection pipes, and water reservoirs, a treatment plant and main pipes. When an area
is subdivided, the subdivider installs local roads and utility lines. Historically, the costs of
extending municipal services to support new development were offset by utility customers and
taxpayers. Like many cities, San Luis Obispo requires developers to pay for the increased
capacity of citywide facilities needed to serve new development. The developers costs for
installing public facilities within a development and for funding citywide facilities are passed on
to occupants of the new housing units.
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San Luis Obispo Housing Element, March 30,2004
Most sites within the City have streets and utility lines nearby, so they can be developed without
Significant extensions. However, expansion areas at the edge of the City will need service
extensions. A specific plan is required for each major expansion area, and a development plan
for each minor expansion area. These plans will address phasing of development and services,
subject to availability of additional water resources.
Increased water service capacity and transportation network improvements are needed before
housing can be built in major expansion areas. The Land Use Element requires that before land
is annexed to accommodate new development, the City should adopt a plan for how the
necessary public services and utilities will be financed and provided. For major expansion areas,
actual development can occur only when the City is able to provide adequate services for the
annexed area as well as for existing and potential development elsewhere within the City.
Water Sources
The City of San Luis Obispo utilizes three water supply sources to meet the community's water
demand: Santa Margarita Lake (also referred to as Salinas Reservoir), Whale Rock Reservoir and
groundwater. The adopted safe annual yield from these three sources for 2003 is 7,510 acre-feet.
To achieve the planned build-out population, the City's projected water demand is 9,096 acre-
feet per year (afy). An additional 1,806 acre-feet is needed to achieve the City's planned build-
out population of 57,200 persons. Table C-9 shows water available for new residential
development in 2003, based on present per capita water demand for all uses and safe annual
yield.
Table C-9
Water Available for Residential Development, 2003
City of San Luis Obis o
Year Population Present Water Demand Safe Annual YieldWater Available in
@ 145 gpcd 2003 for Allocation
2003 44,359 17,204 a.f 7:510 a f. 306 a.f.
Source: Ciry of San Luis Obispo Utilities Department
includes reductions due to siltation to date
According to Water Management Element Policy 8.1.3, one-half of the water available for new
development will serve intensification and infill development within existing City limits as of
July 1994, and 153 acre-feet is available to serve development in expansion areas.
One of the Council's major goals is to secure additional long-term water supplies to meet future
population needs. The City is proceeding with the Water Reuse Project, which has the potential
to be accomplished soonest. Projected water deliveries will begin in late 2004. Following initial
construction, recycled water will offset approximately 130 acre-feet per year of current potable
water used for irrigation. The project has a total potential yield of 1,200 acre-feet per year.
Possible new water sources that the City is actively pursuing are summarized in Table C-10.
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San Luis Obispo Housing Element,March 30,2004
Table C-10
Possible New Water Sources, 2002 - 2022
City of San Luis Obispo
'Source `` - Earikit-Da Potential-- . _=Added—
Available3 Yield4 Dwellm s
Water Reuse 22004 130 273
Water Conservation 2005 340 714
Additional Groundwater 2006 500 1,050
Additional water 970 afy 2,037
potentially available in
Tanning period
Balance of Water Reuse 2008 1,070 2,247
Nacimiento Pipeline 2008 3,380 7,098
Salinas Reservoir 2010 1,650 3,465
Expansion
Desalination 2008 n/a n/a
TOTALS -- 7,070 14,847
Source: City of San Luis Obispo,Utilities Department
'City is pursuing multiple water projects through preliminary design stages. Not all will be implemented.
implementation will depend upon feasibility,needs and cost.
2130 acre-feet available initially through recycling to augment potable water supply; additional amounts
possible up to 1,200 afy,depending upon use of recycled water in Margarita/Airport areas.
New water sources dependent upon funding availability.
°Amounts in acre-feet per year. One acre-foot equals 325,851 gallons.
50ne acre-foot will serve three dwellings per year in San Luis Obispo-, assumes 70%of new sources used
for residential development,30%for commercial uses.
Wastewater Treatment(Sewer)
The City's current wastewater treatment facility has a design capacity of 16 million gallons per
day (mgd). According to the City's Utility Department, this is adequate capacity to meet current
needs, plus residential growth anticipated during the planning period. The City is planning for a
major plant upgrade in 2008, which will expand water treatment capacity to handle the General
Plan anticipated growth, or a population of 57,200 by the year 2022.
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San Luis Obispo Housing Element,March 30,2004
j) Public Services
Police and Fire
In 2003, Police Department staffing level is slightly below the standard set by the City of San
Luis Obispo, as measured by the percentage of available time for sworn officers to respond to
calls. The standard calls for a minimum 30% of sworn officers to be available at any given time.
According to San Luis Obispo Police Department, the percentage of available time has averaged
25 percent for the previous quarter, and while Cal Poly University is in regular session, typically
stays below the 30 percent standard.
According to the National Fire Protection Association, the ratio of emergency services personnel
(firefighters and emergency medical services) should not be less than 1/1,000 residents to
maintain public safety. San Luis Obispo's peak emergency service population, due to daytime
employment (including Cal Poly University) is estimated to be 70,000 persons, requiring 70
firefighter/EMT personnel to meet the desired service ratio. The maximum number of city
firefighters/EMTs is 45, or a daytime service ratio of about 0.6 emergency personnel per resident.
Increased residential development will increase the demand for emergency services and raise city
costs for police and fire services. Community needs for increased police and fire services
resulting from residential growth will be met through, development impact fees, environmental
impact mitigation imposed at the time of development, or through user fees.
k) Schools
Grade school enrollment in San Luis Obispo has declined in recent years. San Luis Coastal
Unified School District's enrollment in San Luis Obispo schools, as of June 2003, is 4;317
students. Enrollment is down by 176 students from last school year. According to District
studies, new residential development generates 0.65 school child per dwelling. The District
estimates that one or possibly two additional school sites will be needed to serve planned
residential growth in the southern part of the City. The Margarita and Orcutt Area Specific Plans
are expected to include potential elementary school sites. Due to district budget constraints, new
dwellings will have serious adverse consequences for school staffing, facilities and programs
unless new development adequately mitigates the adverse impact on school facilities.
2. Non-governmental Constraints
a) Land Costs
Land is the second largest component in the cost of new housing, accounting for over 20 percent
of development costs. Because land costs are so high, it is difficult to build affordable housing if
the project involves purchasing land at today's prices. Land costs directly affect the cost of
housing. In tum, land values are determined by a number of factors. In terms of residential
constraints, the most important of these is land availability and permitted residential density. As
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San Luis Obispo Housing Element,March 30,2004
land becomes scarcer, its price increases. Other factors being equal, the more residential units
allowed,the higher the land value.
In 2003 the cost of an undeveloped, average-size, single-family residential lot in San Luis Obispo
was estimated by members of the Board of Realtors multiple listing service to be between
$250,000 and $375,000, depending on its size and location. By contrast, in 1992 the cost of a
typical single-family residential lot in San Luis Obispo ranged from $140,000 to $200,000, an
increase of about 88 percent when compared to the 2003 figures. The average land cost per
square foot for 10 vacant, single-family(R-1 zone) lots sold in San Luis Obispo in 2002 was $31,
and ranged from a low of about $17 to a high of $41 per square foot. In 1993 the cost for
undeveloped land suitable for housing ranged from $8 to $12 per square foot.
The situation for vacant, multi-family zoned residential land is similar. Between 2000 and 2003,
sales prices for vacant land suitable for multi-family housing ranged from $8 to $43 per square
foot, averaging about.$23 per square foot.
Buoyed by record-low interest rates, the demand for residential real estate has continued to be
very strong since 2000, despite a slowdown in other city and county economic sectors. Land
suitable for residential development within City limits and in expansion areas adjacent to the City
is typically priced to reflect its"highest and best use."
b) Construction Costs
Technological advances in home building have increased efficiency and reduced the proportional
costs of labor and materials. Nationally, labor and materials accounted for 69 percent of the cost
of a new home in 1949. By 1989, that percentage had dropped to 53 percent (National
Association of Home Builders). Reduced construction costs have, however, been more than
offset by increased land costs.
According to the City's building official, the construction value of an average Type V - wood
frame residential construction in 2003 is $83 per square foot, up from $64.80 per square foot in
1993. For a typical, 1,850-square-foot detached house with a garage on a standard-sized lot in
San Luis Obispo,total development cost in 2003 -- including land, construction, and city fees—is
approximately $354,275. Estimated land cost accounts for 53 percent of the total cost,
construction about 43 percent, and city fees around four percent.
b) Availability and cost of financing
Mortgage interest rates significantly affect housing affordability. As interest rates increase, fewer
buyers can afford to purchase a home. As rates decrease, the number of potential homebuyers
increases. In 2003 mortgage interest rates for a conventional, 30-year fixed.loan range from 5.50
to 5.9 percent, and 15-year and adjustable rate mortgages are 5.25 percent and 4.75 percent,
respectively.
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San Luis Obispo Housing Element,March 30,2004
A wide variety of loan packages and terms are available, making financing accessible for most
homebuyers with good credit and moderate- to above-moderate incomes. Although low interest
rates in 2003 have made housing more affordable than in recent years, the necessary down
payment still can pose an insurmountable obstacle -- particularly to first-time homebuyers.
Lenders typically prefer a 20-percent down payment on a mortgage loan. Prospective buyers who
might be able to support an 80-percent loan, often do not have the financial resources to make the
required down payment. A median-priced home in San Luis Obispo costs $442,500 (SLO Board
of Realtors, May 2003), requiring an $88,500 down payment to get into a new house. Lenders
will sometimes loan up to 90 percent of the asking price, but an applicant's credit is much more
closely scrutinized, and monthly payments and monthly income requirements are significantly
higher. Consequently, financing can pose a major obstacle for first-time or moderate-income
homebuyers, even for those who might otherwise qualify for a conventional loan.
Interest rates are determined by national economic policies and conditions, and there is little that
local governments can do to affect interest rates. Cities may, however, offer interest-rate buy-
downs, gap financing or other programs to expand home ownership opportunities for low- and
moderate-income and first-time homebuyers. Although mortgage interest rates have remained
relatively low since 2001, rates can change quickly. In mid-2003 interest rates are rising slowly
and appear likely to return to more normal levels as the national economy rebounds in 2004.
d) Insurance Costs
Insurance costs have become an important constraint to building affordable housing.
Construction liability insurance, needed by builders and required by lenders, has become difficult
to obtain in California and when available, is extremely expensive. According to the
Homebuilders Association of the Central Coast, liability insurance costs can equal about two
percent of a unit's selling price, or $6,000 for a $300,000 condominium. In part, insurance cost
increases resulted from unprecedented construction defect litigation, particularly in California, in
the 1990s. Most of that litigation focused on residential condominiums. Condominium
construction, a major type of new housing in San Luis Obispo in the 1980s, is one of the most
effective approaches for providing higher-density, ownership housing for moderate-income
buyers. Condominium construction fell dramatically in the 1990s. According to local builders,
this was due in part to construction defect litigation and to high insurance costs. In 2002 Senate
Bill 800 (Burton) was signed into law, clarifying the grounds for construction defect lawsuits and
limiting builder liability for such actions. In 2003 there appears to be renewed builder and
consumer interest in residential condos, and city housing policies promote this housing type.
e) Design Expectations
Housing preferences have changed dramatically in the last generation, as shown by a comparison
of tract housing built in town around 1960 and tract housing built today. Detached homes are
generally larger and include more built-in features and amenities. Even many attached
condominiums, which have become owner-occupied "starter" houses, include more indoor space
125
San Luis Obispo Housing Element,March 30,2004
and amenities than older, detached housing:
Those seeking homes today are children of the generation that experienced the greatest increase
in real house buying power, and they often prefer large, detached homes similar to those in which
they were raised. These expectations are often unrealistic given the high cost of living in
California when compared with other States, and the relatively high cost of living in San Luis
Obispo when compared with other areas. Homebuyers moving to San Luis Obispo from urban.
areas often enjoy higher median incomes and arrive with substantial equity from selling another
home elsewhere. Their buying power, together with the desire for a better life in a smaller city,
has fueled the demand for larger, detached homes.
fl Investment expectations
Investment expectations also can add to the cost of housing. Nationally, Americans place a high
value on home ownership because it provides a hedge against inflation and allows us to build
substantial equity in a relatively short period of time. Ironically, the favorable tax treatment
established to protect home ownership has helped push the cost of housing beyond its value as
shelter alone, and has created a competitive market for real estate as a commodity or financial
investment. Home ownership has become an elusive goal for many first-time buyers, as prices
increased in response to market expectations. Renters find themselves paying a larger and larger
share of their income for housing, as rental properties are resold to a succession of landlords.
Many home owners and owners of rental property benefit from significant tax advantages. In
2003 mortgage interest on loans for both a principal home and a second home is usually
deductible for taxpayers, and interest on home equity loans also is usually deductible. In
addition, homeowners can defer capital gains resulting from the sale of a house so long as
another home is purchased at the same or higher cost, and may avoid paying taxes on capital
gains from the sale of a home after the age of 55. Owners of rental property can deduct expenses
such as property taxes, mortgage interest payments and maintenance costs. Also, since rental
property theoretically depreciates in value over time, owners can deduct part of a property's value
each year from their taxable income. While depreciation allowances provide an investment
benefit for each successive property owner, they also offer a strong incentive to resell a property
once the largest share of depreciation has been taken. The new, higher sales price is then offset
by increased rents. Sales commissions, typically ranging from four to six percent of the sales
price, also affect housing costs.
3. Regional Housing Need Allocation and Quantified Objectives
The City's Regional Housing Needs Allocation (RHNA)as determined by the San Luis Obispo
Council of Governments is shown in Table C-11.
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San Luis Obispo Housing Element, March 30,2004
Table C-11
Regional Housing Need Allocation, January 2001- July 2009
Cityof San Luis Obispo
__IncQme_Grolg amber of,,j•1ew _ — Quantified .. _
DwelfinasAllocated Objectives
Very Low 1,484 1,390
Low 844 777
Moderate 870 817
Above Moderate 1,185 1,103
TOTAL 49383 41087
Source: City of San Luis Obispo,Community Development Department
State housing law (Article 10.6, Section 65583(b)(2) of the California Government Code)
recognizes that total housing needs identified for a jurisdiction may exceed available resources
and the ability of the jurisdiction to satisfy this need within the context of State and local General
Plan requirements. Under these circumstances, a jurisdiction's quantified housing objectives
need not be identical to the total housing needs.
San Luis Obispo has evaluated its ability to accommodate the RHNA number of 4,383 dwellings
by July 2009. Limited water supplies prevent the City from achieving the RHNA number within
the planning period. The problem is chiefly one of timing, since there is sufficient land suitable
for residential development to accommodate the RHNA number within the planning period.
Planned water supplies will allow this number of dwellings to be achieved over a longer period.
As shown in Table C-11, the City's quantified objectives are less than the RHNA number. The
quantified objectives include:
1) Dwellings built and granted occupancy during the period from January 1, 2001 through
July 31, 2003;
2) Dwellings expected to be built and receive occupancies between August 1, 2003 and
December 31, 2003 based on current construction inspections; and
3) Potential residential development between January 1, 2004 and July 1, 2009, based on
anticipated water supplies;
4) Construction of up to 1,178 dwellings on Cal Poly University-owned land for students,
faculty and staff.
a) Residential Growth Implications of Achieving Quantified Objectives
During the Housing Element planning period, the City could accommodate up to 4,087 new
dwellings, as shown in Table CAL Of the total, up to 1,178 units will be located on State-
owned land, plus another 2,167 units will be targeted for very-low and low-income households.
These units are exempt from the one percent growth target in the Residential Growth
127
San Luis Obispo Housing Element, March 30,2004
Regulations. During the planning period, at least 742 non-exempt units will be developed. The
resultant residential growth rate during the planning period is 0.51 percent. This is less than
General Plan anticipated residential growth rate of one percent per year.
Achieving the quantified objectives is contingent upon the City having adequate funding to
undertake the necessary capital improvements for the expanded water conservation and
groundwater programs in 2005 and 2006 that will add 840 acre-feet and the capacity to serve
1,764 additional households, and upon private development decisions and economic factors
outside of city control. And while the attainment of these housing objectives is theoretically
possible given available land resources and expected water and sewer capacity, it is highly
unlikely these numbers of units will actually be produced without significant public subsidies.
In 2001, Department of Finance figures estimate the total number of city housing units at 19,355.
The construction of 742 moderate and above-moderate units would represent about 15% of the
City's planned growth capacity between 2001 and 2022 (4;945 units), the anticipated build out
date. As shown in Figure C-4, residential construction is cyclical following regional and national
trends. Between 1980 and 2003, city housing production averaged 196 units per year. This
average rate could increase to up to 225 units per year after 2004, and the City could still expect
to reach buildout in the anticipated timeframe. During the 7 '/i year planning period, the City will
grow at a rate of about 99 non-exempt units per year.
The City recognizes its responsibility to reduce constraints to achieving housing needs and to
expand housing opportunities for.all income groups, to the extent physical, environmental and
financial limits allow. The City intends to help residents secure safe, good-quality, affordable
housing, and to meet regional housing targets in the same percentage allocations by income
group as prescribed in the RHNA Plan. To help achieve this goal, the City intends to encourage
housing production by zoning adequate sites for future housing, securing the necessary water
resources and sewer capacity to accommodate new development, and by exempting moderate-
income housing from residential growth regulations to encourage affordable housing.
b) Water Supply Constraints
In 2003 the City's safe annual yield is 7,510 acre-feet. Estimated water demand for 2003, based
on an adopted per capita water use rate of 145 gallons per person per day, was 7,204 acre-feet,
leaving 306 acre-feet per year (afy) available for new development. With completion of the
initial phase Water Reuse Project expected in 2004, an additional 130 afy will be available
initially for new development. Based on past water use, it can be anticipated that seventy percent
of available water supplies will be used for residential development, and 30 percent for
commercial uses.
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San Luis Obispo Housing Element, March 30,2004
Table C-12
Maximum Residential Development Potential Based on Anticipated Water
Supplies, January 2003—July 2009
City of San Luis Obispo
Source, Earliest Acre Feet/Year Potential Dwellings3
Available
Difference between current 2003 306 643
use and safe annual 4eld
Water Reuse Project 2004 130 273
Water Conservation 2005 340 714
Additional Groundwater 2006 500 1,050
Supply
Subtotals n/a 1,276 2,680
Water required for housing
built between 1/01/03- n/a [192] n/a
12/31/03 4
Available Water Supply for
Residential Development, n/a 19084 2,276 maximum #of
1/1/04-7/1/08 units possible5
Source: 2003 Water Resources Status Report,City of San Luis Obispo, Utilities Department
City is pursuing multiple water projects through design stage. Implementation depends on cost and need.
'-130 acre-feet available in planning period. Up to 1,070 afy additional as Margarita/Airport Areas develop and can
use recycled water.
370% of available water used for housing; 30% for commercial uses. One acre-feet/year will supply enough water
for three dwellings.
°Between 1/1/03 and 12/31/03,583 in-city dwellings are anticipated, @ .33 afy/dwelling= 192 afy.
51,084 afy X 0.7%X 3 =2,276 dwelling units possible between 1/1/04 and 7/1/08.
Steps the City has taken to secure additional water supplies include:
• Water reuse became economical in 1994 after the City completed a $25 million upgrade of
the Water Reclamation Facility to comply with requirements for discharge to San Luis
Obispo Creek. The tertiary treatment required for discharge to the creek produces recycled
water that can be used to irrigate parks, playgrounds, agricultural crops and landscaping.
The recycled water also may be used for industrial processes, construction and many other
non-potable uses.
• In 2003 consultant proposals were evaluated for the engineering work necessary to increase
the use of groundwater resources. The schedule for the project envisions this new source
fully available in the summer of 2005. The goal of the project will be to increase
groundwater production by approximately 500 acre-feet per year.
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San Luis Obispo Housing Element, March 30,2004
• The 2003-05 Financial Plan includes an expanded Water Conservation Program to be
implemented beginning in the 2003-04 fiscal (does everyone know what your fiscal year is
— i.e., ends Dec. 31 or June 30?) year, with the potential to reduce overall water use by
approximately 340 acre-feet per year; making this amount available for additional
development.
• The County of San Luis Obispo is administering the Nacimiento Pipeline Project. The City
has requested 3,380 acre-feet for planning purposes. In July 2003 the revised
Environmental Impact Report is being evaluated, and the document is scheduled for
certification by the County Board of Supervisors in late 2003.
• The City of San Luis Obispo has been pursuing the Salinas Reservoir Expansion Project for
over 11 years. The decision to go forward with project development is on hold, pending a
judgment by the participating jurisdictions (County of San Luis Obispo, Paso Robles,
Atascadero and San Luis Obispo)on developing the Nacimiento Pipeline Project.
c) Land Resources and Development Rate
The City is actively pursuing annexation of two major expansion areas that will, upon
completion, add approximately 1,850 dwellings to the housing stock. Before these areas can be
annexed, City policies require preparation of a Specific Plan. The Draft Margarita Area Specific
Plan has been completed and a Draft EIR circulated for public comment. Annexation is likely in
2004, followed by subdivision processing and development review. At the earliest, new housing
would be ready in late 2005. The Orcutt Area is earlier in planning stages. A Draft Orcutt Area
Specific Plan has been prepared, with some revisions underway in 2004 to reflect higher density
and innovative design approaches for this new neighborhood. Allowing for completion of the
Specific Plan and the EIR process to follow, the Orcutt Area is expected to begin construction no
earlier than 2007.
During the Housing Element planning period, housing needs primarily will be met through in-
city infill and intensification, and through development of the Margarita Area. A 2003 inventory
of vacant and underutilized land showed an in-city development capacity of 3,149 additional
density units. Under City standards, a density unit has the following equivalencies:
Studio Unit —0.50 Density Unit
One-Bedroom Unit —0.6.6 Density Unit
Two-Bedroom Unit — 1.00 Density Unit
Three-Bedroom Unit — 1.50 Density Units
Four or More Bedrooms —2.00 Density Units
This development capacity is equivalent to 3,149 additional two-bedroom dwellings, or 2,099
three-bedroom dwellings, or a combination of different dwelling types with density unit values
130
San Luis Obispo Housing Element, March 30,2004
totaling 3,149. And while theoretically possible under City standards, actually achieving this
development potential is highly unlikely. This rate of development, 3,149 dwellings (assuming
two bedroom dwellings) in 7.5 years, averages 420 units per year. As shown in Figure C-4, this
rate of construction has been achieved in only about nine of the 44 years between 1955 and 1999.
Residential construction averaged only 83 dwellings per year between 2000 and 2002.
Figure C-4
Residential Construction, 1955-1999
City of San Luis Obispo
Net Increase in Dwellings(Permits Issued)
700
600
500
400
m
c 300
200
100
0
'`0yo '41� '00' ^Co 'e^Cg '011 'CA NCb e91� '0' x°'11 o 'q 'Cb Noj N4:p '`41 Noll Ncp No '411
Years
Source: City of San Luis Obispo,Community Development Department,2000
Between 1980 and 2003, an average of 196 dwellings was added each year. Residential growth
management rules began in 1982, following General Plan policies targeting a two- percent
population growth rate during the 1980s and a one percent growth rate thereafter. Growth
Management rules were revised in 1996 to exempt very low- and low-income housing. In 1987
Growth Management Regulations were suspended when the City adopted Water Allocation
Regulations. In 1999 the City Council adopted new regulations (Municipal Code Chapter 17.88)
and a phasing schedule to manage growth. The new regulations emphasized scheduling of
development in the major annexation, while the timing of infill projects would not be regulated.
New dwellings affordable to residents with very low or low incomes were exempt from the one-
percent growth policy and the regulations. Across these policy changes, the cyclical
construction pattern continued.
Population changes are shown in Table C-13. These also tend to correspond to regional and
national economic cycles, and show an average annual growth rate of 1.02 percent during the 26-
year period from 1977 to 2002. Future growth rates are likely to follow this trend.
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San Luis Obispo Housing Element,March 30,2004
Table C-13
Population Change, 1977-2002
Ci of San Luis Obis o
3.Y•EARu-",-S-YEAR--
YEAR'S ANNUAL ANNUAL
YEAR POPULATION CHANGE AVERAGE AVERAGE
1977 34,282
1978 33,756 -1.5
1979 34,143 1.1 -0.2
1980* 34,252 0.3 0.0
1981 34,759 1.5 1.0 0.4
1982 35,239 1.4 1.1 0.6
1983 35,660 1.2 1.4 1.1
1984 36,407 2.1 1.6 1.3
1985 37,378 2.7 2.0 1.8
1986 38,205 2.2 2.3 1.9
1987 38,282 0.2 1.7 1.7
1988 39,858 4.1 2.2 2.3
1989 41,207 3.4 2.6 2.5
1990* 41,958 1.8 3.1 2.3
1991 42,178 0.5 1.9 2.0
1992 42,922 1.8 1.4 2.3
1993 43,397 1.1 1.1 1.7
1994 43,919 1.2 1.4 1.3
1995 41,295 -6.0 -1.2 -0.3
1996 41,404 0.3 -1.5 -0.3
1997 41.807 1.0 -1.6 -0.5
1998 42,201 0.9 0.7 -0.5
1999 42,446 0.6 0.8 -0.6
2000* 44,174 4.1 1.9 1.4
2001 44,218 0.1 1.6 1.3
2002 44,426 0.5 1.6 1.2
26- Av e 1.02% 1.030/. 0.95%
Source: City of San Luis Obispo,Community Development Department
*U.S.Census figures;all others California Department of Finance.
lit
San Luis Obispo Housing Element, March 30,2004
Appendix D
Residential Land Resources
To adequately plan for future housing, it is essential to understand the City's residential land
resources. In 2002-2003, the Community Development Department conducted a parcel-by-parcel
inventory of vacant and underutilized land in two geographic areas: 1) within City limits, and 2)
outside City limits but within the Urban Reserve. The inventory also identified properties that
contained "blighted" or dilapidated dwellings to the extent this was apparent from public streets.
Survey information was derived from aerial photography, official City Planning and Building
permit records, and field visits. The following information is derived from that inventory.
1. Availability of Sites for Housing
A key component of San Luis Obispo's Housing Element is the identification of infill housing
sites and future housing development opportunities in the 2001-2009 planning period.
Opportunities for housing development may include:
a. Vacant land designated for residential use;
b. Underutilized residential sites where lot coverage and density are less than that allowed
by the Zoning Regulations and where infrastructure needs for additional development can
be met;
c. Vacant or underutilized land suitable for mixed-use residential/commercial development;
d. Vacant or underutilized land designated as Interim Open Space and suitable for eventual
residential use once development constraints are resolved;
e. Vacant or underutilized land outside city limits, within the City's Urban Reserve,
including designated expansion areas.
Table D-1 summarizes in-city development potential by zone, as of June 2003. According to the
estimates for vacant and underutilized properties, there is a total development capacity within
City limits of 3,149 density units (DUs), equivalent to 3,149 two-bedroom dwellings. The actual
number of dwellings possible depends on the number of bedrooms in a unit. Table D-2 converts
DUs to the potential number of new dwellings, assuming the mix of new housing in terms of
bedrooms will be similar to the City's housing stock as described in the 2000 Census. As shown
in Table D-2, the in-city development potential is estimated to be 3,255 dwellings.
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San Luis Obispo Housing Element,March 30,2004
Table D-1
Vacant and Underutilized Land in City by Zone, June 2003
ZonelLand Use Designation Vacant Underutilized Total Density
Parcels Parcels, Units2
. A res sAres IT s .._ .. ..
R-1 (Low-density Residential) 73 244 64 189 433
R-2(Medium-density Residential) 7 67 20 161 228
R-3(Medium High-density 1 12 6 73 85
Residential
R4(High-density Residential) 1 19 8 173 192
O(Office) 22 262 10 196 458
PF(Public) <l 4 21 113 117
C-C(General Retail—Downtown) 0 0 1 31 31
C-R(General Retail) <1 6 8 160 166
C-N(Neighborhood Commercial) 1 3 28 2 22 50
C-S(Services and Manufacturing) 24 169 28 221 390
C-T(Tourist) 7 46 29 211 257
M (Services and Manufacturing) 30 215 24 244 459
C/OS(Interim Open Space) 14 60 1 35 1 223 1 283
Totals 182 1 1,132 1 256 1 2,017 3,149
Source: City of San Luis Obispo,Community Development Department,2003.
'Includes Blighted properties.
2 I the R-1 and C/OS zones, each dwelling counts as one density unit (DU). In all other zones, the number of
bedrooms per dwelling determines the DU value. One DU is equivalent to a two-bedroom dwelling.
Table D-2
Potential Number of Dwellings by Bedroom
Bedrooms per % of 2000 Development Density Unit Potential
Dwelling Housing Stock Potential,DUs Value/dwelling Dwellings
0-1 26 819 0.58 1,412
2 34 1,071 1 1,071
3 27 850 1.5 567
>4 13 409 2 205
Totals 100 39149 — 31255
Source: City of San Luis Obispo,Community Development Department,2003.
a. Vacant Residential Land
This category includes vacant, developable parcels in the R-1, R-2, R-3 and R-4 zones, already
served by utilities and streets. There are 73 acres of vacant R-1 zoned land, (40 percent of total
vacant land in the city limits), with a development potential of 244 density units, or an estimated
244 attached or detached single-family dwellings. Generally, single-family detached houses
134
San Luis Obispo Housing Element,March 30,2004
are built in this zone, while multi-family dwellings (apartments and condominiums) are built in
the R-2, R-3 and R-4 zones.
The R-1 zone allows multi-family housing on larger sites at a maximum allowed density of
seven density units per net acre (net acre excludes dedicated right-of-way, areas within top of
creek banks, endangered species habitat, and areas within driplines of "heritage trees."). R-1
zones are typically developed with market rate housing affordable to moderate- and above-
moderate income households. Nine vacant acres of land are zoned and available for multi-family
housing, with a development potential of 98 density units, or about 9 percent of the in-city vacant
land development potential. Applying the ratio of density units to dwellings from Table D-2, an
estimated 101 dwellings.are possible on vacant land in the R-2, R-3 and R-4 zones.
b. Underutilized Residential Land
Underutilized residential land consists of parcels in the R-1, R-2, R-3 and R-4 zones that could
accommodate additional housing based on lot area, slope and zoning. As shown in Table D-1,
underutilized R-1 parcels could accommodate approximately 189 additional dwellings citywide.
The amount of underutilized, multi-family residential-zoned land is very limited. An estimated
420 dwellings are possible on underutilized land in the R-2, R-3 and R-4 zones.
c. Vacant or Underutilized Land Suitable for Mixed-Use Development
City policies encourage mixed residential and commercial uses. Residential uses are allowed as
part of mixed-use development in the C-C, C-D, C-R, C-N, C-T, C-S, M, O and PF zones. This
includes the Downtown Core, an area that historically had many apartments located above
ground-floor commercial uses. General Plan polices encourage housing rehabilitation and
intensification in the Downtown Core (C-D zone). At 36 density units per acre, this zone allows
the highest residential density in the City. Other commercial zones allow 24 density units per
acre for mixed-use development. This category also includes areas with commercial-service and
light manufacturing uses.
City polices encourage multi-family housing close to schools and jobs. In 2003 the City revised
its zoning regulations to expand mixed-use housing opportunities. The revisions introduced
Live-Work dwellings in the C-S and Work-Live dwellings in both the C-S and M zones, a new
form of housing for San Luis Obispo. They also relaxed requirements for establishing mixed
residential/commercial uses, and renamed the C-C zone to C-D, or Commercial-Downtown. The
C-C zone was then applied to community shopping centers outside downtown. Figure D-2
shows the percent of City residential capacity by land use zone, in density units, in 2003.
As shown in Table D-1 there are 210 acres of vacant and underutilized land that could
accommodate mixed commercial and residential uses, with a development potential of 1,928
density units, or about 1,988 dwellings — about 61 percent of the in-city development potential.
Mixed uses are allowed by right in the C-C, C-D, C-R, C-N, C-T and 0 zones, and by use permit
in the C-S and M zones. Mixed uses are allowed in the PF zone with rezoning to PF-MU.
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San Luis Obispo Housing Element, March 30,2004
Figure D-1
Percent of City Residential Development Capacity by Zone,
In Density Units
0
15% PF
M 4%
14%
R1
' 14%
_
as
C-T z-
8% R-2
7%
R-3
GS
12%
R-4 . 3%
C-R C-N C-C Interim 6%
5% 2% 1% C/OS
8%
Source: City of San Luis Obispo,Community Development Department,2003
d. Vacant or underutilized land designated as Interim Open Space
The General Plan Land Use Element shows desired future uses for most land within the urban
reserve line. However, for some properties, the City has not determined the eventual use. Such
properties are designated as Interim Open Space (C/OS), indicating that they will be suitable for
urban development when certain conditions are satisfied. Examples of such conditions include
the provision of access and utility service, reduction of flood hazards and the need for and
appropriate timing of urban development. Development of Interim Open Space requires
approval of a development plan or specific plan showing how these conditions would be met.
Approximately 49 acres of vacant or underutilized Interim Open Space were identified, with a
potential development capacity of 283 density units. Three properties are included: the 25 acre
Sunset Drive-in property, and two parcels of about 11 acres each between Los Verdes Residential
Condominiums and San Luis Obispo Creek (off Los Osos Valley Road). These parcels are
located within a 100-year flood zone and are not suitable for residential development until the
flood hazard is mitigated without significant harm to San Luis Obispo Creek. Because this land
is not yet suitable for residential development and provides open space benefits, it is considered a
lower priority for development and is not included in residential development capacity, Table D-
4.
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San Luis Obispo Housing Element,March 30,2004
e. Vacant or underutilized land outside city limits,within the City's Urban Reserve,
including designated expansion areas
The General Plan Land Use Element identifies an urban reserve line which shows the anticipated
boundary for the City's eventual urban development. This area includes the City's primary
residential expansion areas. For survey purposes, the urban reserve was divided into sub-areas:
1) the major expansion areas designated in the General Plan Land Use Element, such as the
Margarita and Orcutt Specific Plan Areas, and 2) areas suitable for housing and located outside
designated expansion areas, such as the Foothill Saddle area, Highway 1/Highland Drive area and
the Los Osos Valley Gap property, on Los Osos Valley Road, adjacent to Pacific Beach High
School. Table D-3 shows estimated development capacity for the Urban Reserve.
Table D-3
Vacant and Underutilized Land in the Urban Reserve by Sub-area, June 2003
Sub-area Vacant Underutilized Total Potential
Land Land We Dwellin a
Acres . DUs Acres DUs
Major Residential
Expansion Areas:
Margarita Area 410' -- -- -- -- 868
Orcutt Area 231' -- — -- -- 979
Minor Annexation Areas 124 998 12 32 1,030 1,064
Total 2,911
Source: City of San Luis Obispo,Community Development Department
Based on Draft Margarita and Orcutt Area Specific Plans. Acreage includes vacant and underutilized land.
''Density Units
'Assumed development ratio of 1.033 dwelling per density unit.
2. Evaluation of Residential Development Capacity
The City's residential development capacity is summarized in Table D-4. Based on the inventory
of residential land resources within the City and in the urban reserve, up to 6,061 additional
dwellings could be accommodated between 2004 and 2022. Department of Finance estimates the
City has 19,558 housing units in 2003. According to the General Plan, the City's build-out
capacity is approximately 24,300 dwellings by 2022, an increase of about 4,742 dwellings
between 2004 and 2011. This indicates the City's potential residential development capacity
exceeds the General Plan anticipated residential growth by about 1,319 dwellings. The actual
number of residential units to be added will depend upon annexations, residential phasing and the
availability of infrastructure, public services and facilities to serve new residents. Those areas
offering the greatest public benefits in terms of affordable housing, open space preservation and
transportation will receive annexation priority.
137
San Luis Obispo Housing Element,March 30,2004
Allowing a surplus of suitable residential land of at least 20 percent helps moderate land helps
compensate for urban land left vacant due to ownership and development constraints, and helps
moderate land cost increases due to extremely limited supplies of suitable residential land.
HCD guidelines indicate that attached housing built at densities of at least 25 units per acre are
considered affordable to very low-income households, and attached housing at densities of 16
to18 dwelling units or more per acre are likely to be affordable to low-income households.
Three zones allow a base residential density of 36 (two-bedroom) units per acre and therefore,
may be suitable for meeting very low- income housing needs: C-C, C-D, and C-R zones.
Developments that commit at least 20 percent of the total units for housing affordable to very
low-, low- or moderate- income residents are eligible to receive a 25 percent density bonus,
raising the allowed density in these zones to 45 units per acre.
Seven zones allow base densities of 18 to 24 units per acre or more and therefore, may be
suitable for meeting low-income housing needs: R-3, R-4, O, C-N, C-T, C-S and M.
Developments guaranteeing that at least 20 percent of units will be affordable to very low-, low-
and moderate-income households will raise the potential zone density to 22.5 to 30density units
per acre. Vacant and underutilized land in these zones is adequate to meet the City's quantified
needs for very low-, low- and moderate-income housing. Figure D-2 summarizes residential
development capacity in-city, outside city in.minor annexation areas, and in expansion areas.
Figure D-2
Residential Development Capacity, by Dwellings, 2003
3,500-
y.
3,000 '.
M
a 2,500
U i
+. 0 2,000
a.
1,500-
979:%'
500 979
500, 440 m 420
" 31 Acre
Acres cre ^ w Acres
INSIDE CITY OUTSIDECITY MARGARITA OR=AREA
AREA
Location
138
San Luis Obispo Housing Element, March 30,2004
Based on housing completed during the period from January 1, 2001 to December 31, 2003, and
on an evaluation of City land resources with residential development potential as shown in Table
D-4, there is sufficient land to meet the City's RHNA needs for this planning period. However,
because of water supply limitations, the City has proposed quantified objectives that differ from
the assigned housing needs.
Table D-4
Summary of Ho sing Development Potential, 2001-2022
SourcelLocation Acreage Potential Density Potential Dwellings'
Units
Vacant Residential 82 342 353
Underutilized Residential 98 596 616
Mixed-Use ResidentiaF 210 1,928 1,992
Interim Open Space Areas 49 0 0
Minor Annexations 136 1,030 1,064
Subtotals 575 3,896 4,025
Margarita Expansion Area 410 -- 868
Orcutt Expansion Area 231 979
Total Potential Dwellings 59872
Source: City of San Luis Obispo,Community Development Department
Based on Table D-2,potential dwellings= 1.033 X Density Units.
2Includes vacant or underutilized C-D,C-R,C-C,C-N,C-S,M.O and PF zoned land.
'Areas within 100-year flood zone and not presently suitable for development.
139
San Luis Obispo Housing Element,March 30,2004
Appendix E
Review of 1994 Mousing Element
Performance
To develop appropriate programs to address the housing issues identified in this housing element
update, the City of San Luis Obispo has reviewed the housing programs adopted as part of the
previous (1994) Housing Element. The results of the programs, including their effectiveness in
producing additional housing or removing obstacles to housing, is shown in Table E-1. By
reviewing the progress in implementing the adopted programs, their effectiveness, and the
continued need for these programs, a comprehensive housing program was developed, and is
described in Chapter 3 of the updated Housing Element::
Table E-2 compares the quantified objectives of the previous housing element and the actual
achievements between September 1994 and January 2001
Table E-1
Housing Element Evaluation, 1994-2001
Program Subject Description Implementation/Status Working Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.21.4 Safe Housing Expand code Expanded enforcement X
enforcement to program in effect. #cases
resolve chronic rec'd increased 46%since
building safety 1994,with 377 cases
problems and getting resolved in 2001
prevent building Property Maintenance
neglect Standards adopted in 1995
and 2002.
1.22.10 Inclusionary Adopt ordinance Ordinance adopted; has
Housing requiring new produced 75 affordable X
development dwellings and$787,500 in
projects to in-lieu fees in 4 years.
include
affordable
housing or pay
in-lieu fees
141
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.22.11 Housing Trust Establish fund to Fund adopted by Council X
Fund provide Resolution;Award Catena
affordable and review process
housing and approved 12/01; $215K
assist very- awarded for 32-unit low-
low/low/moderat income apartments.
e income Current Balance is
persons $572,500.
1.22.12 Periodic Periodically Commercial zoning X
Review of review regulations recently
Regulations development amended to encourage
regulations and residential uses in
consider commercial zones.
changes to
remove
unnecessary
regulations and
encourage
affordable
housing
1.22.13 Permit Adopt Draft policies prepared; not X
Streamlining procedures for yet adopted.
streamlined
processing of for
affordable
housing projects
1.22.14 Flexible Review Zoning Regulations, X
Regulation development Parking and Driveway
regulations to Regulations, and Dev.
encourage Review Procedures include
innovative, flexible standards for
energy-efficient residential development.
housing through Very-low and low-income
flexible housing exempted from
regulations for Residential. Growth Regs.,
owner-builders 3/96.
142
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.22.15 Fee Amend Resolutions 8415 and 9131 X
Exemptions regulations to adopted waiving
reduce development review, permit
development and impact fees for
review/permit affordable housing.
costs for
affordable
housing projects
1.22.16 Condominium Regulate Ordinance No. 1315 X
Conversions condominium adopted, establishing
conversions and condominium conversion
adopt regulations. Affordability
affordability regulated by Inclusionary
requirement for hsg. standards.
conversions
1.22.17 Public[Private Help coordinate Council-initiated actions to X
Coordination public/private expand R-3/R-4 zoning in
actions to Orcutt Area is a recent
encourage example.
affordable
housing
1.22.18 Assisted Enable issuance MRBs not currently in use
Financing of mortgage for housing. X
revenue bonds to
assist first-time
and low income
homebuyers
Affordable Conserve Implemented on a case-by-
1.22.19 Housing affordable case basis. City used X
Conservation housing such as CDBG funds to stabilize
mobile homes, and improve mobile homes
apartments, and non-conforming
older or legal housing for low-income
non-conforming tenants.
housing; mitigate
relocation
impacts from
public projects
143
San Luis Obispo Housing Element March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.23.7 Housing Establish CDBG-funded Housing
rehabilitation program to Rehab. Grants funded X
loans provide low- improvements for 75 low-
interest city loans income households.
or other
assistance to
preserve
affordable
housin
1.23.8 Housing in To conserve Draft ordinance reviewed
Office Zones housing in office by Council; postponed to X
zones, consider coincide with Housing
adopting a"no Element update.
net housing loss"
policy
1.23.9 Revise Office Amend Zoning Pending Zoning Regs.
Zoning Regulations to would expand allowed X
maintain residential uses Mixed-Use
dwellings in Ordinance adopted in
office zone Ordinance
districts
1.23.10 Downtown Include a"no net Draft ordinance reviewed
Housing housing loss" by Council; postponed to X
Conversion policy in the coincide with Housing
Downtown Element update.
Housing
Conversion
permit process
1.23.11 Remove Remove Building Demolition and
Regulatory regulatory Relocation procedures
Obstacles obstacles to revised to eliminate use
relocation and permit requirement. for X
rehabilitation of relocating housing and
dwellings to be Arch. review for all non-
demolished due historic buildings. Zoning
to redevelopment Regs. allow post-disaster
of their sites reconstruction for non-
conforming, multi-family
housing.
144
San Luis Obispo Housing Element,March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.23.12 Remove Adopt Not done. Would coincide
Private regulations to with update of Subdivision
Restrictions prohibit private Regulations. Has not been
restrictions a problem in SLO. X
(CCBRs)which
preclude
relocated or
rehabilitated
dwellings in new
subdivisions
1.23.13 Seismic Safety Create an No action taken. Only 121
Education educational buildings in SLO identified
campaign for as having high seismic risk
owners of older (URM); most of these are X
residences on non-residential buildings.
ways to reduce
seismic safety
hazards
1.23.14 Seismic Create a Council adopted financial
Retrofit financial incentives to encourage X
Assistance assistance seismic strengthening of
program to help URM buildings;does not
low income apply to non-URM
households buildings.
protect their
homes against
earthquakes
1.23.15 Non- Consider Proposed Zoning
conforming amending amendments would allow X
Residential regulations that housing in all commercial
Use make housing a zones
non-conforming
use in certain
zones
1.23.16 Housing Consider No action taken.
Conversion amendments to X
building,zoning,
and fire code
requirements
which encourage
conversion of
housing to other
uses
145
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.24.4 Mixed-income Review City Inclusionary Housing
policies regulations and Standards implemented X
revise as needed mixed-income policies.
to implement the
mixed-income
policies
1.25.6 Mixed Housing Consider Inclusionary Housing
Types amendments to Standards implemented X
development mixed-income policies.
regulations to
implement
mixed-variety
and tenure
policies
1.26.7 Growth Amend
Management Residential Completed
Growth X
Management
regulations to
exempt housing
affordable to
very-low and low
income
households
1.26.8 Neighborhood Consider
Commercial amendments to No action. X
Mixed use zoning
regulations to
require dwellings
above street
level in new
neighborhood
commercial
developments
1.26.9 Downtown Amend No action.
Residential regulations to X
Use require dwellings
in new multi-story
commercial
buildings in the
Downtown
146
San Luis Obispo Housing Element, March 30,2004
Program Subject Description implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.26.10 Specific City will adopt Considered in preparation
Plans/R-4 specific plans for of specific plans for X
zoning major expansion Margarita and Orcutt areas;
areas which will complicated by unknown
include sufficient relationship between
R-4 zoned land "regional need" and
to accommodate necessary R-4 capacity,
regional needs and by ALUP requirements.
for very-low and
low income
housing
1.26.11 Edna-Islay Amend Edna- Primary planning area is
Specific Plan Islay Specific built out. Was considered X
Plan and rezone when secondary area was
to include a mix annexed; rejected by City
of medium-high Council.
_
density housin
1.26.12 Residential Give priority to Considered and rejected by
Service residential City Council. X
Priority projects in the
event public
services must be
rationed to new
development
1.27.7 Neighborhood Establish Office of Neighborhood
Involvement procedures to Services established; City X
encourage public notice procedures
neighbor input implemented.
into planning and
development
review Process
1.27.8 Neighborhood Identify Office of Neighborhood
Planning neighborhood Services established and X
needs, problems, neighborhood issues
opportunities; addressed with new
designate staff to ordinances.
work directly
with
nei hborhoods
1.27.9 Neighborhood City will help fund So. Laguna Lake street
Projects neighborhood improvements, a recent X
improvement example
roiects
147
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.27.10 Neighborhood Revise Community Design
Security development Guidelines adopted. X
standards to
require all new
housing provide
visibility of
streets and
public areas
1.27.11 Neighborhood Review City Neighborhood Preservation
Quality Regulations and Ordinance adopted 5/01. X
revise as needed Code enforcement program
to implement expanded to one full time
neighborhood position; Civil Penalties
quality policies Ordinance adopted to
assist enforcement efforts.
1.28.6 Homelessness Support jointly CDBG programs support
with other Homeless Shelter and
agencies, local Prado Road Day Center;
and regional Women's Shelter and X
solutions to Transitional Housing.
meeting needs of (Delete reference to
homeless CDBG)
persons and
displaced
women and
children
1.28.7 Mobile Home Continue to Mobile Home Rent
Rent Control regulate mobile- Stabilization Ordinance in X
home park rent effect.
increases
1.28.8 Special Identify sites in Mobile homes, cooperative
Housing Sites expansion areas housing, manufactured
for mobile home housing allowed wherever
parks, standard"stick-built" X
cooperative housing allowed.
housing,
manufactured
housing or other
housing which
meets special
needs
148
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.28.9 Campus Advocate Construction of on-campus
Housing development of "Suite"type student X
non-dormitory housing underway at Cal
housing on the Poly.
Cal Poly
University
campus and
refurbish existing
campus housing
1.28.10 Fraternity/ Facilitate on- "Greek" housing limited to
Sorority campus R-3 and R-4 zones. City X
Housing accommodations policies encourage this type
for fraternities of housing on campus.
and sororities
and.limit their (Split into two programs)
expansion in
residential
nei hborhoods
1.28.11 Student/ Adopt"good The"WIN" program has
Community neighbor" been adopted (Working to X
Relations program to Improve Neighborhoods),
improve including education and
communication community relations,
and cooperation Community Services Team
between the City, and other programs.
Cal Poly,
residents and
students
1.29.3 Energy Educate staff, Implemented through
Conservation citizen review building plan check/Title 24 X
Education bodies and the compliance and through
public in energy architectural review.
conservation
issues to
promote
compliance with
energy-
conserving
housincl cloals
1.29.4 Solar Heating Amend No action. Proposed to be
Requirements development: deleted as part of X
standards to Conservation &Open
require solar Space Element update, due
water heating for to current State energy
new apartments standards.
and houses
149
San Luis Obispo Housing Element,March 30,2004
Program Subject Description Implementation/Status Working - Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.29.5 Energy Assemble an Proposed Conservation&
Conservation energy Open Space Element X
Policy committee to update includes energy
advise the City policies; referred to energy
on updating the advocates; no committee
Energy Element formed.
for energy
efficient housing
1.29.6 Solar Access Consider Proposed Conservation &
Policy changes to solar Open Space Element X
siting and access update includes energy
to improve long- policies; referred to energy
term residential advocates; no specific
solar access siting/access comments
received. _ --
1.29.7 Plumbing Continue and City essentially fully
Retrofits expand the retrofitted. Mandatory X
subsidized retrofitting discontinued.
plumbing retrofit
program for
water
conservation —-
1.29.8 Water Make water Implemented through public
Conservation conserving education outreach and X
landscape media spots.
education and
retrofit a priority
coequal with
plumbing retrofits
1.30.5 Commercial/ Require Implemented through
Industrial proposals to environmental review X
Expansion annex required for all new
commercial-or annexations.
industrial-zoned
land to evaluate
impacts on
housing demand,
supply and cost
150'
San Luis Obispo Housing Element, March 30,2004
Program Subject Description Implementation/Status Working- Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.30.6 Airport Area Discourage Implemented through.
significant. County Referrals program. X
expansion of Specific Plan adoption
employment in anticipated in 2003.
the
unincorporated
airport area,
pending
annexation
1.30.7 Out-of-area Request Handled on a case-by-case
Housing developers of basis. Most recent. X
Demand housing projects example: DeTolosa Lottery
to promote their limited to SLO County
projects only residents or people
within the San employed in SLO City.
Luis Obispo
County housing
market area
1.30.8 City Make City Implemented by Economic
Promotional promotional Development Manager. X
Practices practices,
economic
development
efforts, and other
actions
consistent with
the policy of not
enticing persons
from elsewhere
to move to San
Luis Obispo.
1.30.9 Enrollment Link enrollment Implemented through City
Growth growth at Cal participation in Student X
Poly and Cuesta Housing Needs study and
College to the through Council direction.
provision of
campus housing
rorams
1.30.10 Institutional Link expansion Council policy direction
Growth of State X
institutions, e.g..
California Mens'
Colony with the
provision of
employee
housing
151
San Luis Obispo Housing Element,March 30,2004
Program Subject Description Implementation/Status Working - Keep- Not Done Not
Number Keep Needs —Needs Needed
Change New Look
1.30.11 Non- Consider Non-residential growth
residential amending the management policies X
Growth Limits growth included in Land Use
management Element, however
regulations to non-residential growth
moderate long- regulations considered and
term housing rejected by City Council.
demand due to
non-residential
growth
1.31.5 Site Suitability Adopt Safety Element and open
regulations to space policies updated; X
prevent new specific plans and GP
housing on revisions for consistency
unsuitable sites with ALUP pending.
or where subject
to hazards or
incompatible
land uses
Table E-2
Progress in Achieving Housing Element
Quantified Objectives, 1994-2001
PROGRAM QUANTIFIED LEVEL OF PERCENT
OBJECTIVE nits ACHIEVEMENTi nits ACHIEVED
NEW
CONSTRUCTION
Very Low 381 62 16
Low 317 42 13
Moderate 172 6 3
Above Moderate 347 537 155
TOTAL 1416 647 53
REHABILITATION
Very Low 56 18 32
Low 33 21 64
Moderate 31 0 0
Above Moderate 62 0 0
TOTAL 182 39 1 21
152
San Luis Obispo Housing Element,March 30,2004
CONSERVATION
Notices of Violation
VeryLow 57 n/a
Low 34 n/a
Moderate n/a
Above Moderate n/a
TOTAL 91 21800
PRESERVATION
Units At-Risk
Very Low 77 77
TOTAL 77 77
Source: City of San Luis Obispo, Community Development Department
IThe Housing Element quantified objectives originally covered the planning period 1994— 1999,but this table
includes accomplishments during the period 1994 through 2000 due to delays in the Statewide Housing Element
update cycle.
ZConservation of housing and neighborhoods evaluated in terms of code enforcement actions. Total units not broken
down by income category due to lack of available data.
153
San Luis Obispo Housing Element, March 30,2004
Appendix F
Five-Year Implementation Plan
(To be completed later)
154
Appendix G
Housing Task Force Recommendations
The City of San Luis Obispo Housing Element Update Task Force
Report to the City Planning Commission
Final Draft
October 15, 2003
Housing Element Update Task Force
Sam Blakeslee Cuesta College (Co-Chair)
Linda Dalton Cal Poly(Co-Chair)
Stephen B. Barasch SLO Property Owner's Association
Andrew Carter Renter/low-income household/family
Gabe Garcia Renter/low-income household/family
Cydney Holcomb Residents for Quality Neighborhoods
Kent MacDonald Downtown resident.
George Moylan San Luis Obispo Housing Authority
Anita M. Robinson Banker/housing lender.
Sandra Sarrouf ECOSLO
Richard Schmidt Sierra Club
Chris Skiff Housing developer/builder
Scott Smith Peoples Self-Help Housing Corporation
Elizabeth 'Biz' Steinberg Economic Opportunity Commission
Tom Swem Downtown Association
Patricia Wilmore SLO Chamber of Commerce
James Caruso Planning Commission(Non-Voting)
Community Development Department
John Mandeville, Director
Michael Draze,Deputy Director
Jeff Hook, Project Planner
San Luis Obispo Housing Element, March 30,2004
The Housing Element Update Task Force
On January 7, 20037 the City Council established the Housing Element Update Task Force and
directed staff to work with the Task Force and the Planning Commission to prepare a housing
element that could hopefully achieve state certification consistent with City General Plan goals.
City Council Resolution No. 9387 establishing the Housing Element Update Task Force set out
the following:
Goals of the Council:
To update the General Plan Housing Element with the goals of expanding housing opportunities
for very-low, low, and moderate-income households, preserving and enhancing residential
neighborhoods, and complying with state laws, including the California Environmental Quality
Act(CEQA).
Duties of the Task Force:
1. Review and comment on existing housing policies and programs in an effort to expand
housing opportunities for very-low, low and moderate-income households.
2. Recommend new housing goals, policies or programs to address community housing needs.
3. Review the Draft Housing Element Update.
4. Other duties as assigned by the City Council.
The Housing Element Update Task Force held eighteen meetings over a period of seven months,
reviewing information presented by staff, the public, individual members of the Task Force, and
issue reports by five subcommittees comprised of Task Force members. The information
reviewed ranged from the goals, policies, and programs in the 1994 Housing Element to concerns
over impacts to existing residential neighborhoods and new ways to encourage production of
more affordable housing by the public and private housing providers. Although there were
clearly differences of opinion about the relative priority of issues and the most effective
approaches to solving identified problems, Task Force members reached consensus on most of
the issues.
This report focuses on a list of specific issues the Task Force members developed early in their
meetings. The report is organized into six sections based on major topics the Task Force dealt
with, plus an appendix that includes comments on issues where at least two of the Task Force
members disagreed with the prevailing opinion of the group. In the main body of the report, all
issues that reflect consensus of the group are simply stated. Those where the group did not agree
are indicated by the vote in brackets following the statement; (for, against, abstain). Some
issues remain unresolved and are so noted.
In addition, the Task Force provided specific suggestions for refining some of the broad goals
that frame the housing element. These include the following:
156
San Luis Obispo Housing Element, March 30,2004
Affordability—There was a consensus on need to update the definition.
Housing Conservation — Members raised concerns regarding the extent to which this goals
involves conserving the number of units or the units themselves.
Energy and Water Conservation-There was a consensus to incorporate`'sustainable design" into
the goal.
Demand Management — Members suggested more positive wording, such as "maximize
opportunity for those who live and work in the City" or"Balance supply and demand"
Suitability — There was a consensus to add a new goal to encourage innovative subdivision and
housing design.
I. URBAN FORM AND CONTEXT
Statement of Principles
The Task Force believes that new housing development should occur within the existing urban
reserve line of San Luis Obispo. The City should continue policies and programs that discourage
urban sprawl and its concomitant woes, particularly traffic. The City should continue policies
and programs that promote a compact urban form. (10-3)
In order to accommodate residential growth, the Task Force believes the City should focus as
much on infill and densification within current City limits as it does on annexation within the
urban reserve line. {10-3)
Infill represents the building of housing on existing vacant lots within the City. Residential
densification can be accomplished in various ways, but it should be targeted to specific areas
downtown, near Cal Poly, near major commercial areas, and along major transportation routes.
{10-31
General Recommendations
The Task Force recommends adopting multiple policies to encourage residential growth in ways
consistent with the above principles.. These measures include the following:
I) Intensify downtown residential development.
2) Encourage the development of additional housing on-campus and near campus.
3) Encourage the development of additional housing near major commercial areas.
4) Encourage the development of additional housing along major transportation routes.
5) Discourage development of higher-density housing in other locations than mentioned above.
{7-6)
6) Encourage mixed residential and commercial development.
a) Consider rezoning specific undeveloped commercial property to residential.
b) Encourage "live/work" and"live-near-work"housing.
c) Examine all regulations that prevent building to currently allowed residential densities.
157
San Luis Obispo Housing Element, March 30,2004
d) Consider upzoning specific lower-density residential property to higher-density in
appropriate areas downtown, near Cal Poly, near major commercial areas, and along
major transportation routes. {10-31
Specific Recommendations: The Task Force recommends implementing the following measures
in conjunction with the above principles and recommendations:
1) Adopt flexible zoning standards in targeted areas in return for the provision of additional
affordable housing units. These standards might utilize Floor Area Ratios for a given site,
reduced lot sizes, reduced setback requirements, increased building heights, increased
allowable land area coverage, the use of least restrictive standards for mixed use
developments, etc. {10-3)
2) Relax open space requirements in the expansion areas in return for the provision of additional
affordable housing units if the open space protected is not specifically tied to geographic
features like hillsides, wetlands, and watercourses. {10-3)
II. HOUSING DESIGN, NEIGHBORHOOD CHARACTER AND LIVABILITY
Statement of Principles
The Task Force believes that any new housing should maintain a "good fit" with its surroundings
and provide a pleasant and attractive living environment for residents. Increased housing
development and density should not undermine the appealing characteristics of the existing urban
fabric nor require reduced standards of housing design for individual developments.
The City's existing Community Design Guidelines provide a good start for describing the
standards that can ensure quality housing and neighborhoods. However, these guidelines need to
be clarified and expanded in order to adapt to new, denser forms of housing.
General Recommendations: The Task Force recommends the following:
1) Ensure that higher-density housing maintain high standards for unit design, privacy, security,
types of on-site amenities, and the nature of public and private open space.
2) Ensure that higher-density housing is compatible with adjacent development, particularly
established residential neighborhoods.
Specific Recommendations: The Task Force recommends studying the implementation of the
following specific initiatives or programs:
1) New and/or revised Community Design Guidelines should address the amount, usability,
nature, and location of both public and private open spaces within housing developments.
2) New and/or revised Community Design Guidelines should address the nature of driveways
and parking lots within housing projects, specifically the "tunnel effect" created by long,
parallel lines of units which face each other across narrow driveways, and the amount of
158
San Luis Obispo Housing Element,March 30,2004
separation of driveways and parking lots from pedestrian walkways, unit entrances, and
private living spaces.
3) New and/or revised Community Design Guidelines should ensure adequate standards for
setbacks and height limits for developments located in existing neighborhoods.
4) Downtown Residential Development Standards should ensure that the massing, scale and
architectural character of new developments create an attractive living environment. 110-3)
5) The above standards of livability should be flexible enough to allow creative design
approaches in special circumstances, e.g., in developing mixed-use developments or in
residential housing in the downtown. {I 2-1}
Issue 1: Adjust Parking Requirements to Meet Needs of the Development Rather than the
Current Residential Parking Standards for each Residential Zone
1) Adopt flexible parking standards in targeted areas for specific developments. These
standards might include lowering the number of required parking spaces in return for
live/work or live-near-work housing, the payment of parking in-lieu fees, the payment of
mass transit in-lieu fees, the provision of alternative transportation for residents, restrictions
on the number of cars residents may own, off-site parking facilities.(public or private), shared
parking facilities (on-site or adjacent, commercial or residential), the provision of additional
affordable housing units, etc.
a) Allow lower parking requirements, including the possibility of zero parking, for
development in the downtown core and its adjacent neighborhoods; along major
transportation routes; near existing shopping districts; and within higher-density
residential areas near Cal Poly. 112-1)
b) Allow lower parking requirements, including the possibility of zero parking, for
developments that provide a range of alternative parking or transportation options for
residents. Such options would include, but are not limited to, agreements to use parking
lots on adjacent or nearby properties(including "live-near-work" housing), agreements to
use. City-owned parking lots at night, and providing residents with alternative-energy
vehicles. (12-1)
c) Mitigate the impact of developments through reduced parking requirements, especially in
established RI and R2 neighborhoods, by expanding the neighborhood parking permit
program, by enforcing existing regulations regarding street parking, and by decreasing the
amount of allowable paving [now 50% of the front yard] for parking areas in residential
neighborhoods. (12-1)
d) The program of parking reduction should be implemented on a limited, experimental
basis in order to test the impact and efficacy of the proposed parking changes.
2) New and revised Community Design Guidelines and Parking Standards should address the
amount of parking required for the types and locations of developments that are consistent
with the City's plan for compact urban form. {12-11
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Issue 2: Explore Allowable Densities in Existing Residential Zones and Underlying Criteria
General Recommendation: Allow greater housing densities and the potential mix of housing
types to encourage a broader range of affordable housing options.
Specific Recommendations:
1) Establish reasonable, equitable, and predictable density bonuses based on predesignated areas
in the City, dwelling form, occupancy type, use of mixed-use development, and the
percentage of affordable units in a development. 112-1}
2) Establish smaller minimum conforming lot area requirements in residential zones where
appropriate. {10-2-1)
3) Create meaningful density incentives based on the percentage of affordable housing created
in any given development. {12-1)
4) Create higher allowable residential density for Mixed Use Developments.
Issue 3: Rectuire that Livability Standards Be Retained Through Good Design When Using
Higher Density
Issue 4: Encourage Live-Near Work with Allowed Reduction in Parking
Issue 5: Encourage More "Mixed Use" Types of Development Related Issues
Issue 6: Retain Integrity of Open Space on Each Lot
Issue 7: Discuss When We Preserve Existing Structures and.When We Don't
III. PRESERVATION AND ENHANCEMENT OF EXISTING RESIDENTIAL
NEIGHBORHOODS AND CONSERVATION OF EXISTING HOUSING STOCK
Statement of Princiales:
The Task Force believes that our neighborhoods are the basic building blocks that make up the
larger community of San Luis Obispo. They are the places where we live, recreate and sometimes
work. They constitute the largest use of land in the City and the homes within oftentimes
represent the largest single investment residents will ever make.
San Luis Obispo's neighborhoods are diverse.Neighborhoods downtown and in the northern part
of the City are older; these areas face distinctly different challenges than their counterparts in the
newer, southern part of the City. The Task Force believes that City policies should reflect this
diversity of needs by (1) defining types of existing neighborhoods and, on the basis of that
definition, provide direction to protect, enhance, and/or revitalize them; and (2) supporting the
development of'new residential areas as well-functioning neighborhoods.
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General Recommendations: The Task Force recommends the following objectives in regard to
preservation and enhancement of existing residential neighborhoods.
1) Protect the peace and quiet of single-family neighborhoods.
2) Clarify that neighborhood integrity applies to more than the RI areas.
Specific Recommendations: The Task Force recommends implementing the following specific
initiatives or programs to preserve and enhance the City's existing residential neighborhoods and
to conserve the City's existing housing stock.
1) Preserve and enhance the quality, character and integrity of established residential
neighborhoods. Density; scale; lot size, configuration, and coverage; building size and
placement; set backs and usable open space help to define the character of established
neighborhoods.
2) New development or redevelopment within an established residential neighborhood shall be
consistent with the predominant quality, character and scale of that neighborhood.
3) Ensure that edges of new neighborhoods transition with older residential neighborhoods.
4) Implement a wide variety of strategies to ensure that the residents are educated as to and
involved in planning decisions involving their neighborhoods, early in the process. 19-11
5) Protect the low-density character and private open space associated with .established R-1
neighborhoods.
6) Improve the condition of the City's existing housing by: ensuring strict compliance with the
Uniform Building Code; enforcing existing Housing and Property Maintenance standards;
enacting a Rental Inspection Program; and promoting conservation and rehabilitation. {6-4)
7) Urge Cal Poly and Cuesta College to take an active role in working with city government and
community organizations to create a positive environment around the campus by:
a) Addressing what density of students is appropriate in surrounding neighborhoods;
b) Promoting homeownership in its surrounding low density neighborhoods for university
employees and others;
c) Encouraging and participating in revitalization of degraded neighborhoods.
Additional thoughts by subcommittee:
1) The Housing Element should acknowledge the importance of Universal or Accessible
Design. Although Universal Design standards address the needs of people with disabilities, it
is a comprehensive concept that can benefit all users. Universal design features increase the
usability of the home by people of all ages, sizes, and abilities and enhance the ability of all
residents to live independently in their own homes for as long as possible. Many times, it's
the home itself that causes people to leave -it just isn't "user friendly".
2) Production of a variety of appropriate housing types for special needs populations should be
encouraged, including single room occupancy (SRO), group homes and integrated
community apartment living.
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3) Housing constructed with public subsidies (or incentives)should include units that are fully
handicapped accessible.
Unresolved Issues:
Issue 1: Allow More Imaginative Physical Forms of Housing to Encourage Affordability Related
Issues
Issue 2: Explore Housing on Top of Large Buildings
IV. SUSTAINABLE HOUSING, SITE, AND NEIGHBORHOOD DESIGN
Statement of Principles:
The city should promote residential design sustainable at the lifecycle ("cradle-to-grave") level,
and as benign as possible in its environmental impacts. Sustainable residential design principles
should be applied with consistency to the individual dwelling, the site, and at the neighborhood
level. Individual buildings and new neighborhoods should be viewed in a long-term perspective
rather than as commodities to build as quickly and cheaply as possible, with little thought to
long-term impacts.
General Recommendations:
1) As part of its overall commitment to quality of life for its residents and to maintaining
environmental quality, the city should encourage housing design that's resource-conserving,
healthful, economical to live in, environmentally benign, and recyclable when demolished.
This can be accomplished through practices like the following: {8-1 for this entire section)
a) Maximize use of renewable, recycled-content, and recycled materials, and minimize high-
embodied energy materials and high environmental impact.materials.
b) Incorporate renewable energy features including passive solar design, solar hot water,
solar power, and natural ventilation and cooling.
c) Minimize thermal island effects through reduction of heat-absorbing pavement, and
increased tree shading.
d) Avoid building materials that may contribute to health problems, such as outgassing and
glass fiber contamination of indoor air.
e) Design for quiet, indoors and out, for both the mental and physical health of residents.
f) Design dwellings economical to live in because of reduced utility bills, low cost
maintenance and operation, and improved occupant health.
g) Use: construction materials and methods that maximize the recyclability of a building's
parts.
h) Educate public, staff, and builders to the advantages and approaches to sustainable
design, and thereby develop consumer demand for sustainable housing.
i) Consider adopting a sustainable development rating system, such as the LEED program.
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2) Promote community level residential design. Site design, subdivision design, and
neighborhood design need to be coordinated to make residential sustainability work. Some
ways to do this include: {8-1 for thisentire section)
a) Design subdivisions to maximize solar access for each dwelling..
b) Design sites so residents have usable outdoor space with access to both sun and shade.
c) Adopt lot coverage standards that reduce the amount of land surface that may be covered
with impermeable materials. (Impermeable surfaces include both the area covered by a
building and the area covered by hard-surfaced paving.)
d) Adopt street and access way standards that reduce the amount of impermeable surface
devoted to vehicular use.
e) Use neighborhood retention basins to purify street runoff prior to its entering creeks.
(Such basins should be visual and functional amenities in the dry season, not fenced-off
barren pits.)
f) Encourage cluster development with dwellings grouped around considerable amounts of
shared open space in return for smaller individual lots.
g) Separate neighborhoods of all densities from heavily trafficked streets and highways with
landscaped buffers.
3) In the existing core city, sustainability means maintaining physical neighborhood qualities we
already have. Some ways to do this include:
a) Resisting the urge to overbuild areas like Old Town, thereby maintaining a close-in living
environment appealing to people who can afford to live outside the city and commute
back.
b) Encourage maintenance and rehabilitation of existing historic housing stock.
Issue 1: Create a sizeable body of affordable housing that is as close to permanent as feasible
Statement of Principles:
The private sector developers are not able to reach the lowest income households and this group
will continue to rely mostly on public and private non-profit housing organizations. In addition,
it's difficult to maintain a sizeable body of privately developed affordable housing because
significant portions of that housing stock ultimately become available to the general public at
market rates. Therefore it is desirable to create affordable housing units that remain affordable
for as long as the law allows.
Encourage community support of affordable housing and special needs housing by combating
misconceptions regarding both publicly and privately developed affordable and special needs
housing through active community outreach and education.
General Recommendations:
1) Create affordable rental housing that stays affordable for at least 55 years, whenever that is
possible (see federal tax credit provisions).
2) The city should seek to replicate the success of existing 55-year affordable housing
developments such as those that were established at Marvin Gardens, Brizzolara, and Carmel.
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3) Assist in the establishment of long-term affordable housing units by identifying city-owned
properties that could be used for that purpose and owned by the city in perpetuity.
4) The city should review its existing inventory of city-owned under-developed properties and
dedicate some portion of those properties to address affordable housing issues. For example,
one might envision a mixed-use downtown parking structure that would incorporate an
element of onsite housing. The mixed-use parking structure could leverage off the city-
owned land and the availability of parking enterprise funds to finance the underlying parking
structure.
5) Encourage local government to acquire land for current or future affordable housing
development, either through direct market acquisition or donation by developers as an "in-
lieu"option.
6) Ensure long-term affordability of ownership housing through shared equity. f 8-1}
Issue 2: Student Housing
Statement of Principles:
Thousands of students attending Cal Poly and Cuesta College live in or near San Luis Obispo.
Their presence has had a number of positive and negative impacts to the community. Many
students occupy single-family homes, particularly in neighborhoods near Cal Poly, and this has
produced some negative impacts to these neighborhoods. The city's housing element needs to
provide for the protection of existing neighborhoods and the availability of decent and affordable
housing for students.
General Recommendations:
1) Increase the supply of dedicated"on campus" and "off campus" student housing at a rate that
is at least commensurate with the increase in out-of-area enrollment. Such housing, whether
it is on-campus or off-campus, should include management and transportation services
appropriate for student living.
2) Reduce the incidence of unsafe and non-conforming conversions that create student rentals
out of garages, closets, and attics.
3) Urge Cal Poly and Cuesta to maximize their supply of student housing on campus to avoid
displacement of existing residents or a loss of existing rental housing resources available to
other City residents.
Specific Recommendations:
1) Urge Cal Poly and Cuesta College to construct additional on-campus housing facilities. This
encouragement may include assistance with issues related to state and federal funding
(grants), water and sewer, circulation, and land use issues.
2) Act as a facilitator to encourage cooperative housing arrangements and partnerships that
include the City, Cal Poly, and Cuesta College.
3) Assist Cal Poly and Cuesta College in their efforts to provide supervised off-campus housing
facilities. This may entail a willingness to rezone parcels, reroute public transportation
services, or expand circulation capacity in particular areas. {7-2}
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4) Encourage off-campus students to live throughout the community rather than in large,
concentrated, student-only enclaves. (8-11
5) Although it is important to manage the impact of student housing on residential
neighborhoods it is essential to avoid concentrating large numbers of students in
unsupervised settings—thereby creating the potential for Isla Vista-like setting somewhere in
or near San Luis Obispo.
6) Locate off-campus student housing near major transportation corridors or in close proximity
to the campuses to reduce circulation impacts.
7) Increase enforcement of existing city ordinances that prevent unsafe and illegal conversions.
Such conversions can make competing on-campus and off-campus housing developments
appear less affordable than their illegal counterparts. These units increase the risk of higher
vacancy rates at student housing developments, which in turn reduces the likelihood of new
units being built in the future.
8) Work with other jurisdictions to advocate for changes in State legislation that would: (1)
provide funds for public higher education institutions to provide adequate on campus housing
for students; and (2) allow more flexibility to individual institutions to engage in public-
private partnerships to construct new student housing.
Issue 3: Owner Occupied Mobile/Manufactured Home Lots
Statement of Principles:
Owner occupied mobile/manufactured home lots provide an important supply of entry-level
affordable homes. Many families now own their own single-family home because they first
purchased a smaller entry-level dwelling such as a condominium, a duplex, or a townhouse.
Some of the most affordable entry-level dwellings are mobile/manufactured homes..
Unfortunately, they are in exceedingly short supply.
General Recommendations:
Dedicate a certain portion of new housing in expansion areas for owner-occupied manufactured
home lots.
Specific Recommendations:
1) Encourage developers to create owner-occupied manufactured home parks with amenities
such as greenbelts, recreation facilities, and shopping services within a master planned
community setting. Such parks could be specifically designed to help address the needs of
those with mobility and transportation limitations.
2) Establish lot sizes, setback, and parking guidelines that allow for relatively dense placement
of manufactured homes within the master planned community.
3) Locate manufactured home parks near public transit facilities or provide public transportation
services to the manufactured home parks to minimize the need for residents to own
automobiles.
Issue 4: Special Needs Populations
Statement of Principles:
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Certain special-needs populations may faceboth economic and non-economic challenges that
make housing particularly difficult to acquire. Such populations could be assisted in obtaining
housing if funds were dedicated for that purpose. Special Needs Populations include disabled
persons, elderly persons, large household, farm workers, single-parent families, homeless
persons, students, and shared households.
General Recommendations:
1) Encourage close cooperation between the city and the county to address affordable housing
needs.
2) Encourage the County-Wide Housing Trust Fund to allocate a fixed percentage of the funds
raised to be expended for Special Need Populations.
3) Better define which populations qualify for special need assistance.
Specific Recommendations:
1) Minimize use of affordable housing dollars for bureaucracies and staff positions, particularly
when staffing and administrative needs could be met by coordinating with the County or with
existing non-profits.
2) Certain Special Need Populations should be served through coordinated assistance from both
the city and county.
3) Utilize existing unoccupied hotel buildings in downtown San Luis Obispo for appropriate
single room occupancy (SRO) and transitional housing.
4) Encourage co-housing as a housing alternative as has been done in Oceano and Paso Robles.
5) Increase multi-family rental housing availability.
Issue 5: Improve education on the use of Universal Design
Establish workshops for designers, architects, and the public to provide education on
understanding the advantages of universal design and how this benefits people of all abilities
through the lifespan of the occupants and of the building.
Issue 6: Protect housing affordability for low income occupants by limiting city utility
increases consistent with City policy
The existing utilities have programs for this purpose and they should be continued and expanded
where practical. {7-51
V. GOVERNMENT REGULATIONS, PROGRAMS, & PROCEDURES
Statement of Principles
The City shall encourage the provision of a wide range of housing types to meet community
needs by adopting policies, procedures and incentives that facilitate rather than inhibit the
construction and preservation of affordable housing. The Task Force believes that while most
city policies serve useful purposes in regulating the type and nature of growth, some regulations,
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programs and procedures may inhibit housing development in general and affordable housing
development in particular. The City should work to remove unnecessary or onerous
governmental roadblocks to housing development.
Recommendations:
1) Review and amend or replace planning policies so as to ensure that they support the
construction of affordable housing
a) Review existing and proposed policies, regulations and programs with respect to how
they may affect housing production and affordability.
i) For example, amend existing policies, regulations, and programs where appropriate to
remove provisions that tend to reduce housing affordability.
ii) For example, require findings regarding the impact of any new policy, regulation, or
program on the financial feasibility of building affordable housing.
2) Provide exceptions to standards and fees for moderate as well as low-income housing, using
a scale to provide the greatest relief for housing designed for lower income levels. (7-4)
3) Refine definition of affordability to reconcile how rental and for-sale prices are evaluated and
create an extremely low and an above moderate (120%-160% of median income) category.
(8-3)
4) Make a commitment to strong incentives. (9-2)
a) Create incentives that are significant enough to make an impact on housing production
and affordability.
b) Adjust incentives on a scale so to offer more incentives for low vs. moderate-income
housing.
5) Modify inclusionary housing policies to emphasize incentives, including density bonuses and
other provisions that encourage the production of affordable units. (8-3)
6) Clarify the conditions and incentives for preserving existing housing.
a) Historic buildings and districts should be respected, recognizing that building clusters and
neighborhoods as well as individual buildings can be historically significant.
i) Clarify criteria and process
ii) The City should define buildings & districts beforehand to extent possible
iii) The City should seek to retain character and style in neighborhoods
b) Housing conservation in areas (a) not identified as historic districts and (b) not in R-1, R-
2, R-3, or R-4 zones needs to be clarified (specific buildings or dwelling unit count)
i) Greater predictability in rules is desirable.
ii) The Task Force discussed the conversion of housing to other uses (i.e., offices). This
conflict between achieving no-net-loss and simply allowing what underlying zoning
allows was not resolved.
iii) Existing rules regarding no-net-loss for conversion of four or more units should be
retained.
iv) Incentives should be used to help retain residential units when less-than-four
residential units are affected by a development.
c) The City should provide appropriate incentives to encourage additional housing in the
downtown, particularly in mixed-use developments.
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i) Density or use bonus and additional allowable heights
ii) Flexibility in parking requirements for mixed use housing
iii) Fee reductions
iv) Encourage mixed use conversions
v) No-net-loss of residential units requirements can be satisfied in nonresidential (i.e.,
not R-1 through R-4) zones if conversion includes mixed-use housing.
d) The City should streamline housing approval procedures. {7-4}
e) The City should maintain and publicize a list of dwellings available for relocation. {9-2)
f) The City should redefine development standards and create incentives for R3 and R4
zones to facilitate the construction of multi-family housing that approaches full density.
{9-2}
g) The City should support an affordable housing manager to coordinate housing programs
with other City departments and outside organizations.
i) Direct the housing manager to address implementation of the recommendations in this
report, particularly removal of barriers, provision of incentives, and clarification of
criteria and processes.
Unresolved Issues
The Task Force debated how to address the conservation of housing not in R-1, R-2. R-3 or R-4
zones and not in historic districts. The primary concern of the debate focused on what might be
called transitional areas around Downtown that were once primarily residential.
The majority of the members felt that landowners in such zones have the flexibility to develop
their property according to the full range of uses permitted in the zone. Within this group, some
were very comfortable with including housing in new mixed-use developments, particularly if
incentives were offered to address building mass and parking requirements. In other words, this
group interprets the notion of"no net loss" as applying to maintaining the number of housing
units,rather than individual structures per se.
The minority perspective included two concerns — one focused on design and the other focused
on affordability. With respect to design, this group argued that the scale of existing residential
units contributes to the character of a transitional neighborhood, so the structures themselves
need to be preserved as part of any land use conversion. Often, also, the design and spatial
quality of these dwellings is irreplaceable (Victorians or large bungalows, for example) and thus
the loss to housing variety as well as neighborhood character caused by their removal can be
significant. With respect to affordability, this group argued that replacement units may not be as
affordable as existing housing and/or might be built for smaller households, resulting in a net loss
in the supply of housing for some markets even if the number of units is maintained.
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VI. FINANCING AND IMPLEMENTING AFFORDABLE HOUSING
Statement of Princivles
The Task Force believes that in order to achieve the desired goal of the creation of more units of
affordable housing in the City of San Luis Obispo, innovative incentive and financing programs
as well as modifications to current City programs will be required.
Recommendations:
2) Support a Countywide Housing Trust Fund(CHTF)
a) City should work with the CHTF to secure dedicated sources of funding.
b) To assist the CHTF, the City should focus on grants, loan guarantees, Prop 46 funds, and
City inclusionary housing funds. {9-2}
3) Increase inclusionary housing requirements for commercial development {6-5}
4) Spread cost of Affordable housing to entire community by developing or reallocating sources
of funding.
a) Enact a City real estate transfer fee. {6-5}
b) Dedicate part of TOT to housing programs. {8-3)
5) Amend the following affordable housing standards:
a) Create a Extremely Low-Income Category for Rental Housing
b) Created an "Above Moderate" Income Category ranging from 120— 160%of area median
income
c) Modify the formula for calculating maximum "Affordable Housing Sales Price" using
typical lending practices. Specifically, sales price should be based upon maximum loan
plus 3% down payment. Maximum loan should be calculated using 30-year amortization
and interest rate based on I Ith District Cost of funds plus 3%.
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Minority Opinion Report
As should be expected, the members of the Housing Element Update Task Force did not agree on
all specific issues brought before them. Where those issues could not be revised to reach
consensus, the prevailing opinion as indicated by vote of the members in attendance, was used in
the main report and recommendation to the Planning Commission. This minority opinion report
includes those issues that were deleted from the main report. It was agreed that the Planning
Commission should have the benefit of seeing the issues forwarded by a subcommittee or
member if at least two members supported the idea.
This minority opinion report does not include arguments or other references to issues that were
put into the main report over the protest of a minority of the Task Force members but that is
reflected in the votes shown after each issue. No separately prepared opinions have been
included that express additional minority opinions although this was discussed at a Task Force
meeting. Individual members may submit written or oral comments directly to the Planning
Commission on issues that specifically support or oppose in this report. The following
comments along with the Task Force vote are arranged in the same order as the main report for
easy reference.
I. URBAN FORM AND CONTEXT
Unresolved Issues:
The general issue of infill development and "densification" raised concerns among some
members of the Task Force. These included the following:
1) Development of higher-density housing could have a harmful effect on neighborhood quality
of life. This could be especially true for higher-density housing in or near existing R-1
neighborhoods.
2) Redevelopment of existing structures could have a negative effect on the character of certain
neighborhoods, particularly the older ones in and around downtown.
3) Redevelopment of existing commercial structures downtown may not be economically
viable.
4) The relaxation of parking standards could exacerbate existing parking problems, particularly
the amount of on-street parking.
5) The relaxation of open space standards in annexation areas could lead to increased
development of existing farmland within the urban reserve line.
11. HOUSING DESIGN, NEIGHBORHOOD CHARACTER AND LIVABILITY
The following two paragraphs were removed from the Subcommittee recommended comments
on a vote of 10-3. The preceding language was left in as Specific Recommendation 1):
a) Common outdoor spaces should create a sense of identity and focus for the development and
be usable for a variety of passive recreation and social activities. Common outdoor areas
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relegated to awkward "leftover" spaces of lots or dominated by parking drives or areas are
undesirable. Numeric standards should not be the sole criteria for judging the adequacy of
required outdoor space.
b) Private outdoor spaces should be contiguous to the units they serve, have adequate dimensions
for a variety of uses, be screened from public view, and have exposure to sunlight for a
meaningful period of daylight hours. Outdoor spaces whose dimensions are too shallow or
narrow, open to public view. or effectively shaded by overhangs, projecting balconies, or other
elements, are undesirable. The guidelines should clarify that the minimum "other yard"
requirement of five feet should not be used where such yard constitutes the primary private
outdoor space for a unit. In such cases, the minimum dimension should be ten feet and no
overhead projections or coverings should be allowed.
The following paragraph was removed from the Subcommittee recommended comments on a
vote of 10-3. The preceding language was left in as Specific Recommendation 3):
The Community Design Guidelines encourage building separations and changes in plane and
height. These include such building elements as bay windows, porches, arcades, dormers, and so
forth to relieve flat walls and roofs of excessive length. At the same time, piecemeal
embellishments of facades and frequent changes in materials, particularly in smaller
developments or where many individual units stand together are undesirable. The Guidelines
should be revised to clarify that the architecture of a building or group of buildings should be a
coherent design, and that variety should derive from changes in scale, massing and fenestration.
Superficial stylistic variations between adjoining buildings should be avoided.
III. PRESERVATION AND ENHANCEMENT OF EXISTING RESIDENTIAL
NEIGHBORHOODS AND CONSERVATION OF EXISTING HOUSING STOCK
The following sentence was removed from the Subcommittee recommended comments on a vote
of 6-4:
Retain integrity of open space on each lot. Consider entire area as in a planned development. #8
The following sentence was removed from the Subcommittee recommended comments on a vote
of 7-3:
To help residents preserve and enhance their neighborhoods, the City will: Identify
neighborhoods, and work with residents to prepare neighborhood plans that empower them to
shape their neighborhoods. (Also see Land Use Program LU-2.15A.)
The following sentence was removed from the Subcommittee recommended comments on a vote
of 6-4:
Devise strategies to help stabilize the rental/owner ratio, to maintain neighborhood character,
safety, and stability. (Also see Land Use Program LU-2.15B.)
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The following sentence was removed from the Subcommittee recommended comments on a vote
of 9-2:
Encouraging any infill housing constructed by the university to maintain the character and
density of the lowest zoned neighborhood in its vicinity.
The following sentence was removed from the Subcommittee recommended comments on a vote
of 6-4-1:
Use new construction and compliance procedures under the American with Disabilities Act
(ADA) to increase the proportion of housing throughout the City that is accessible or adaptable
for use by residents with physical disabilities.
IV. SUSTAINABLE HOUSING, SITE, AND NEIGHBORHOOD DESIGN
In the following sentence, one member believes that there was some support for 60 years or more
and staff was not able to determine if more members agreed. The statement with "...at least 55
years... " was left in the main report.
Create affordable rental housing that stays affordable for at least 55 years, whenever that is
possible (see federal tax credit provisions).
The following sentence was removed from the Subcommittee recommended comments on a vote
of 5-3-1:
Maintain existing rear yard green.space to provide"lungs"or"green guts" for the core city.
V. GOVERNMENT REGULATIONS, PROGRAMS, & PROCEDURES
No minority positions.
VI. FINANCING AND IMPLEMENTING AFFORDABLE HOUSING
The following sentence was removed from the Subcommittee recommended comments on a vote
of 8-3:
City should provide interim financial and staff support to the CHTF (Countywide Housing Trust
Fund).
The following sentence was removed from the Subcommittee recommended comments on a vote
of 7-4:
The City should implement and encourage other jurisdictions to implement such things as real
estate transfer fees for funding purposes.
The following paragraph was removed from the Subcommittee recommended comments on a
vote of 10-1:
Provide 50% of new housing as affordable (period).
A. Establish comprehensive-enough programs to reach this goal.
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B. Use growth cap as tool.
The following sentence was removed from the Subcommittee recommended comments on a vote
of 9-2:
Limit Size of new SFR or place`-`luxury"tax on them.
The following two paragraphs were removed from the Subcommittee recommended comments on
a vote of 8-3:
One member recommended a 20% general density bonus above and beyond the current allowable
densities in all R-2, R-3, and R-4 zones presently located within any present or proposed city
core areas (to be determined in the future) of San Luis Obispo. He also recommended an
additional 20% general density beyond the initial density bonus for developing any form of
attached housing, any multi-family development that exceeds two (2) stories in height, or any
"Mixed Use Development" that combines housing with any nor-residential land use in order to
increase the available housing stock while using developable land in a more efficient manner.
Furthermore, He recommended that any housing development that exceeds 5 or more units be
given an additional 20% density bonus above and beyond the two previously recommended
density bonuses for developments that create 25% or more of the total housing units in a given
development that meet the countywide or the local criteria for "Affordable Housing Units.
Where developments exceed 20 or more units and create 25% or more of the total housing units
as "Affordable Units" he recommends a 30% density bonus be given above and beyond the two
previously recommended density bonuses.
173
San Luis Obispo Housing Element, March 30,2004
Appendix H
Summary of Public Comments on the
Draft Mousing Element
(To be completed later)
174
San Luis Obispo Housing Element, March 30,2004
Appendix I
General Plan Consistency Analysis_
State law requires general plans to be internally consistent. Therefore, the goals and policies of
each element of the general plan must be consistent with other elements so that specific goals and
policies in one element do not conflict with or obstruct the accomplishment of those contained in
another element.
San Luis Obispo's General Plan contains the seven elements required by State law. In addition,
the City has also adopted optional elements as part of the General Plan. State law requires that
any optional elements adopted at the discretion of the jurisdiction must also be consistent with
the General Plan.
.An analysis of the internal consistency, summarized in Table I-1, was done as part of the
Housing Element update process. Through this analysis, it has been determined that the Housing
Element is consistent with the goals, policies and programs set forth in the General Plan and its
associated elements. In the following matrix, "Y" indicates the Housing Element goal, policy or
program is consistent; "N" indicates it is not consistent.
175
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Appendix J
Public Distribution List
Affordable Homes,Avila Beach
Al Barrow, Los Osos
Andre Morris and Buttery,Attn: Dennis Law, San Luis Obispo
Andrew Carter, San Luis Obispo
B. Weiss Frankel;Paso Robles
Barasch Architects, San Luis Obispo
Betsy Bertrando, San Luis Obispo
Brett Cross,San Luis Obispo
Cal Poly University,Attn: Mike Manchack, San Luis Obispo
Cal Poly University,Atm:Linda Dalton, San Luis Obispo
Camille Small, San Luis Obispo
Carol Winger, San Luis Obispo
Cheryl Burcheri, San Luis Obispo
Chuck Stevenson,ARC, San Luis Obispo
CODHA,Attn:Tim Kershner, San Luis Obispo
ComerStone Real Estate,Attn: Sean Fitzpatrick, San Luis Obispo
Council Member Allen Settle, San Luis Obispo
County of San Luis Obispo,General Services,Atm:George Rosenberger, County Government Center
Cydney Holcomb—RQN, San Luis Obispo
Dale Strobridge, San Luis Obispo
Dotty Conner,San Luis Obispo
Dr. Sam Blakeslee, San Luis Obispo
Economic Opportunity Comm.,Attn: Biz Steinberg, San Luis Obispo
Economic Opportunity Commission,Atm: Catherine Manning, San Luis Obispo
ECOSLO, Atm:Pam Heatherington, San Luis Obispo
Frances Meehan, Los Osos
Fraser Seiple Architects,Atm: Bruce Fraser, San Luis Obispo
Gabe Garcia,San Luis Obispo
Gary Kucer, San Luis Obispo
Glen Matteson, San Luis ON
Habitat for Humanity, Atm: Mary Von Achen,President, San Luis Obispo
HCD,Atm: Paul Dirksen. Sacramento
Home Builders Association,Atm: Jennifer Phillip, San Luis Obispo
Housing Authority of SLO,Atm: George Moylan, San Luis Obispo
Howard Carroll,San Luis Obispo
Jean Knox, San.Luis Obispo
Jeff Garter, San Luis Obispo
Jennifer Bauer,San Luis Obispo
Jerry Bunin,Oceano
John French,c/o SLO Chamber of Commerce, San Luis Obispo
Karen Adler, San Luis Obispo
Kent McDonald, San Luis Obispo
League of Women Voters,Attn: Sara Horne;San Luis.Obispo
Leo Garske, Santa Maria
San Luis Obispo Housing Element,March 30,2004
Lisa Newton, San Luis Obispo
Manse on Marsh,Attn:Chris Skiff, San Luis Obispo
Martin Luschei„San Luis Obispo
Mary Beth Schroeder, San Luis Obispo
Mayor Dave Romero,San Luis Obispo
Michael Sullivan,San Luis Obispo
Mike King,Arroyo Grande
Mission Community Bank,Attn: Anita Robinson, San Luis Obispo
Naoma Wright, San Luis Obispo
OCSHA, San Luis Obispo
Paul Brown, San Luis Obispo
Paul Rys, San Luis Obispo
Peg Pinard,San Luis Obispo
Peoples Self-.Help Housing Corp., Attn: Scott Smith,San Luis Obispo
Phil Gray, San Luis Obispo
Pierre Rademaker Design,Attn: Pierre Rademaker,San Luis Obispo
Pres. Marie E. Rosenwasser,Cuesta College,San Luis Obispo
President,Neighborhoods North of Foothill,Attn:Joan Lynch, San Luis Obispo
Residents for Quality Neighborhoods,San Luis Obispo
Richard Schmidt,San Luis Obispo
Richardson Properties,Attn:Charlie Richardson,San Luis Obispo
Robert and Ginni Griffin, San Luis Obispo
Rossetti Company,Attn:John Rossetti,San Luis Obispo
Sal Orlando, San Luis Obispo
Sandra Nielsen,San Luis Obispo
Sandra Rowley,San Luis Obispo
Sandra Sarrouf,San Luis Obispo
Sherry Lewis,AVNA Representative,San Luis Obispo
SLO Assn. of Realtors,Attn: John Cribb, San Luis Obispo
SLO Chamber of Commerce,Attn: Patricia Whitmore,San Luis Obispo
SLO Downtown Association,Atte:Deborah Holley, San Luis Obispo
SLO Property Owners Assn.,Attn: Mike Spangler, San Luis ON
SLO Supportive Housing Consortium,San Luis Obispo
SLOCOG,Attn: Peter Brown,San Luis Obispo
Strategic Initiatives,Arm: Chuck Ander,Arroyo Grande
The Real Estate Group,Attn: Valerie Endres, San Luis Obispo
The Real Estate Group,Atm: Steve DelMartini, San Luis Obispo
The Tribune,Attn: Julie Lynem,San Luis Obispo
Tom Kay, San Luis Obispo
Tom Swem, San Luis Obispo
Tom Wheeler,CHC Chair, San Luis Obispo
Tyler Fisher, San Luis Obispo
Vintage Properties,Attn: Al McVay,San Luis Obispo
Vintage Properties,Attn:Al McVay,San Luis Obispo
Wood and Associates,Atm: Doug Wood,San Luis Obispo
Ybi Van Ekeren,Los Osos
190
San Luis Obispo Housing Element,March 30,2004
Appendix K
Housing Resources and Outreach
Information
(To be completed later)
191
San Luis Obispo Housing Element, March 30,2004
Appendix L
References
American Planning Association, Regional Approaches to Affordable Housing, Planning
Advisory Service Report Number 513/514, February 2003.
American Planning Association, Affordable Housing: Proactive & Reactive Planning Strategies,
Planning Advisory Service Report Number 441, December 1992.
The Olson Company, Rewarding Ambition: Latinos, Housing and the Future of California, A
Report Produced By: Pepperdine.University, La Jolla-Institute, & Cultural Access Group,
Inc., September 2002.
San Luis Obispo Community Health Foundation, ACTION for Healthy Communities: Indicators
Report, 2003.
Urban Land, Volume 62,Number 1, January 2003.
San Luis Obispo Chamber of Commerce, Workforce Housing: Challenges and Responses,
January 2003.
General Plan Guidelines, Housing Element,
Myers, Dowell & Gearin, Elizabeth, Current Preference and Future Demand for Denser
Residential Environments, Housing Policy Debate, Volume 12, Issue 4, Fannie Mae
Foundation 2001.
San Luis Coastal Unified School District, Enrollment Forecasts, January 16, 2002.
Air Pollution Control District, County of San Luis Obispo, Rules.and Regulations,July 2003.
Assembly Bill No. 1866, Chapter 1062, September 29,2002.
Myers, Dowell & Vidaurri, Lonnie, Real Demographics of Housing Demand in the United
States, The Lusk Review for Real Estate Development and Urban Transformation,
Volume I1,Number 1, Summer, 1996.
Department of Housing and Community Development, Housing Element Legislation Effective
January 1, 2002. Memorandum to Planning Directors and Interested Parties, June 17,
192
San Luis Obispo Housing Element, March 30,2004
2002.
San Luis Obispo Community Health Foundation; ACTION for Healthy Communities:
Comprehensive Report, 2003.
Non-Profit Housing Association of Northern California & California Coalition for Rural
Housing, Inclusionary Housing in California: 30 Years of Innovation, 2003..
City of San Luis Obispo, Community Development Department, Housing Element Review
Worksheet:.Section Il..Housing Needs, December 19,2002.
U.S..Census Bureau, Census 2000.
U.S. Census Bureau, Census 1990.
U.S. Department of Commerce: Economics and Statistics Administration, U.S. Census Bureau,
Poverty:1999, Census 2000 Brief, May 2003.
Home Builders Association of the Central Coast, Development Fee_Studv, June 2000.
State of California Department of Housing and Community Development, Housing Element
Ouestions and Answers: A Guide to.the Preparation of Housing.Elements, June 2001.
University of California, Santa Barbara, The 2001 San Luis Obispo County Economic Outlook
UCSB Economic Forecast Project, Volume 8,November 2000.
San Luis Obispo Chamber of Commerce Economic Vision Task Force, Our Vision of San_Luis
Obispo's Future, 1997?.
City of San Luis Obispo, Community Development Department, 2003 Draft Housing Element
URdate: Development Capacity Survey, August 21, 2003.
California Department of Housing & Community Development, Loan and Grant Program
Directory: Preserving and expanding safe and affordable housing opportunities for all
Californians, October 2001.
State Department of Housing and Community Development, Shelter for the Homeless: Housing
Element Requirements, October 1989.
Non-Profit Housing Association of Northern California, Rethinking Residential Parking:
Myths/Facts, April 2001.
California Department of Housing & Community Development, California Planning Roundtable,
193
San Luis Obispo Housing Element,March 30,2004
Myths&Facts About Affordable &.High Density Housing, May 2002.
Urban Land Institute,The Case for Multifamily Housing, 2003.
Trouble On The Home Front: The. Eight-Day Series, The Tribune, San Luis Obispo County,
California, Series Reprint: June 16-23, 2003.
City of San Luis Obispo, Community Development Department, City of SLO General Plan
Digest, 2004.
SLO Council of Governments, Regional Housing Needs Plan For San Luis Obispo County, 2003.
City of San Luis Obispo, Community Development Department, City of SLO General Plan
Housing Element, September 1994..
City of San Luis Obispo, Community Development Department,Final EIR- San Luis-Obispo
General Plan Land Use and Circulation Element Updates, August 1994.
Vessely, Robert S.; Reay, Thomas G.; and Merriam, Andrew G. San Luis Obispo Downtown
Housing Study. Prepared for the Housing Authority of the City of San Luis Obispo,
December 1995.
194
San Luis Obispo Housing Element,March 30,2004
Appendix M
Glossary
Affordable Housing. Housing that meets the rental or sales price standards as established by the
City and published annually in the Affordable Housing Standards. Such housing is made
available for very-low, low and moderate income persons or households, and subject to deed
restrictions or other instrument that ensure the housing remains affordable for a predetermined
period.
Assisted Housing. Housing units, including multi-family or single-family, whose construction,
financing, sales prices, or rents have been subsidized by Federal, State, or local housing
programs, and units developed pursuant to local inclusionary housing and density bonus
programs-
Below-market-rate Housing. Housing that is sold or rented at prices less than the fair market
value or prevailing market rent for the unit, and the financing of housing at less than prevailing
interest rates.
Boarding/Rooming House. A dwelling or part of a dwelling where lodging is furnished for
compensation to more than three persons living independently from each other. Meals may also
be included. Does not include fraternities, sororities, convents, or monasteries.
Building. Any structure used or intended for sheltering or supporting any use or occupancy.
Build-out. That level of urban development characterized by full occupancy of all developable
sites within the City's Urban Reserve, in accordance with the General Plan; the maximum level
of development anticipated by the General Plan by the year 2022. Build-out does not assume that
each parcel is developed with the maximum floor area or dwelling units possible under zoning
regulations.
Community Development Block Grant (CDBG). A grant program administered by the U.S.
Department of Housing and Urban Development (HUD) on a formula basis for entitlement
communities and urban counties, and by the State Department of Housing and Community
Development (HCD) for non-entitled jurisdictions. CDBG funds are used by cities and counties
for land purchase, housing rehabilitation and community development, public services and
facilities, economic development, and other purposes that primarily benefit persons or
households with incomes less than 80 percent of County median income.
Covenants, Conditions and Restrictions (CC&Rs). Restrictions or requirements that are
195
San Luis Obispo Housing Element, March 30,2004
placed on a property and its use by a property owner, usually as a condition of subdivision
approval. CC&Rs are a deed restriction and"run with the land", and are legally binding.
Density Bonus. An increase in the allowed base density applied to a residential development
project. The increase allows the development of more dwellings than a property's zoning would
otherwise allow, and is usually in exchange for the provision or preservation of affordable
housing or housing amenity.
Density, Residential. The number of permanent dwellings per net acre, measured in Density
Units, as further described in Chapter 17.16 of the Zoning Regulations. In the AG. C/OS and R-
I zones, each dwelling counts as one density unit. In all other zones, dwellings with different
bedroom numbers have density unit values as follows:
a. Studio Apartment(450 sq. ft. or less) 0.50 Density Unit
b. One-bedroom Dwelling 0.66 Density Unit
c. Two-bedroom Dwelling 1.00 Density Unit
d. Three-bedroom Dwelling 1.50 Density Units
e. Dwelling with four or more bedrooms 2.00 Density Units
Director. The Director of the City's Community Development Department, or another staff
person authorized by the Director to act on his or her behalf.
Dormitory. A building used as a group quarters for students, as an accessory use for a college,
university, boarding school, or other similar institutional use.
Downtown Core. The City's central business district, comprising the most diverse mix of
residential, commercial, governmental, and public uses, and defined by the"C-D" zone boundary
as shown in the Zoning Map.
Downtown Planning Area. The central area of the City generally defined by the boundaries
formed by State Highway 101, the Union Pacific Railroad Right-of-Way, and High Street,.and
the intersections thereof, as described in the General Plan Land Use Element.
.Elderly or Senior Housing. Housing designed to meet the needs of and enforceably restricted
to occupancy by persons 62 years of age and older or, if more than 150 units, persons 55 years of
age and older.
Expansion Area. An area located outside City limits but within the Urban Reserve and
designated for future urban development, as further described in the General Plan Land Use
Element text and map.
Fair Market Rent. The rent, including utility allowances, determined by the United States
Department of Housing and Urban Development ("HUD") for purposes of administering the
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Section 8 Housing Choice Voucher Program.
Fraternity House (or Sorority House). A Residence for college or university students who are
members of a social or educational association, and where such an association holds meetings or
gatherings.
Granny Flat. See"Second Residential Unit."
High Occupancy Residential Use. Any dwelling other than a Residential Care Facility as
defined in the Zoning Regulations, that is located in the R-1 or R-2 zones and is occupied by six
or more adults.
Historic Property. A property, including land and building, determined by the City to have
archaeological, historical, or architectural significance as described in the Historic Preservation
Program Guidelines, and listed on the Contributing Properties List or Master List of Historic
Resources..
Household. All persons, including those related by birth, marriage or adoption and unrelated
persons, who occupy a single dwelling.
Housing or "Dwelling" Unit. A building, a modular home, a mobile home, a cooperative, or
any other residential use considered real property under State law and on a permanent foundation,
with provisions for sleeping, cooking and sanitation, and with permanent connections to utilities.
Infill Housing. Development of housing on vacant lots within the City limits on property zoned
for such uses.
Jobs-Housing Balance. A ratio describing the number of jobs compared with dwelling units in
a defined geographic area, and a measure of the adequacy of the housing stock to meet
community needs.
Live-Work or Work-Live Unit. An integrated housing unit and work space, occupied and
utilized by a single household in a structure, either single-family or multi-family, that has been
designed or structurally modified to accommodate joint residential occupancy and work
activities, and which includes:
1) Complete kitchen and sanitary facilities in compliance with City building code, and
2) Working space reserved for and regularly used by one or more occupants of the unit.
The difference between "live-work" and "work-live" units is that the work component of a live-
work unit is secondary to its residential use, and may include only commercial activities and
pursuits compatible with the character of a quiet residential environment, while the work
component of a work-live unit is the primary use, to which the residential component is
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secondary.
Mixed-Use Development. Development in which various uses, such as office, commercial,
manufacturing, institutional, and residential are combined in single building or in multiple
buildings on a single parcel or on multiple, contiguous parcels, developed as integral unit with
significant functional interrelationships and a coherent physical design; property designated
"MU" on the City's.Zoning Map.
Multi-family Dwelling. A dwelling that is part of a structure containing one or more other
dwellings, or a non-residential use. An example of the latter is a mixed-use development where
one or more dwellings are part of a structure that also contains one or more commercial uses
(retail, office, etc.). Multi-family dwellings include: duplexes, triplexes, fourplexes (buildings
under one ownership containing two, three or four dwellings,respectively, in the same structure);
apartments (fiveor more units under one ownership in a single building); and townhouse
development (three or more attached dwellings where no unit is located above another unit. It
does not include Granny Flats or Secondary Dwelling Units.
Municipal project. A development project designed, funded, or carried out by the City of San
Luis Obispo and described as a"capital project" in the City's Financial Plan..
Parcel. A area of land defined by boundaries set by the Tax Assessor of the County of San Luis
Obispo, roughly equivalent to the meaning of a"lot" for development purposes.
Regional Housing Needs Assessment (RHNA). A determination of a locality's housing needs
by the local Council of Government and based on State law, that takes into account various
factors such as population growth, employment growth, vacancy rates, housing removals, and
concentration of poverty.
Rehabilitation. The repair, preservation, and or improvement of housing; and for historically
designated structures, work done according to rehabilitation standards established by the U.S.
Secretary of the Interior and described in the Secretary of the Interior's Standards for the
Treatment of Historic Properties and related documents.
Residential. Land designated in the General Plan and Zoning Regulations for dwellings and
accessory uses.
Second Residential Unit. An attached or detached studio, or one-room dwelling, with not more
than 450 square feet of gross floor area and that includes permanent provisions for cooking,
sleeping and sanitation, and is located on the same parcel on which the primary dwelling unit is
located, pursuant to requirements in Ch. 17.21 of the Zoning Regulations.
Sensitive Site. A site determined by the Community Development Director, Planning or
Architectural Review Commission, or City Council, to have special characteristics or limitations,
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such as historic significance, creekside location, or visual prominence, requiring more detailed
development review than would otherwise be required for other similarly zoned lots nearby.
Single-family Dwelling,Detached. A dwelling occupied or intended for occupancy by only one
household, and that is structurally and physically separate from any other such dwelling.
Single Room Occupancy (SRO) Unit. A single-room dwelling, typically 80-250 square feet in
floor area, with a sink and a closet, with communal facilities for cooking and sanitation.
Tenure. The mode or status of residency, whether by renting or owning real property.
Transitional Housing. Housing provided to homeless persons, abused women or children, or
other persons with special housing needs for a temporary period, and generally integrated with
other social services and programs including counseling, education, and training to assist in the
transition to self-sufficiency through gaining stable income and permanent housing.
Underutilized Site. A site that has the land area capacity to accommodate additional dwelling
unit(s) while meeting all zoning regulations, including setbacks, building height and lot coverage
requirements without the application of variances.
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