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HomeMy WebLinkAbout02/13/1979City Council Minutes February 13, 1979 Page 2 ABSENT: Steve Petterson City StLAf PRESENT: Leland Walton, City Administrative Officer; J.H. Fitzpatrick, City Clerk; George Thacher, City Attorney; Henry Engen, Community Development Director; Glen Matteson, Assistant Planner 1. The City Council, members of various standing council subcommittees, reported on activities to date. A. Area Council of Governments B. C.C.C.J.C. C. County Water Advisory Board D. Whale Rock Commission E. Zone 9 Advisory Committee Councilman Settle Councilman Petterson (absent, no report) Mayor Schwartz Mayor Schwartz Councilman Dunin 2. At this time the City Council continued their public hearing on adoption of the Housing Element of the General Plan as recommended by the City Planning Commission. J. Arsenio, chairman of the Ad -Hoc City -Cal Poly Student Housing Committee, presented what the committee felt was their last report dealing with the charge of the committee which was to .investigate, analyze, and make recom- mendations to the City Council on measures which could be taken to alleviate the housing crisis as it effects the provisions of student housing in the community and with particular reference to the occupancy and behavior problems prevalent in the R -1, single - family, areas. Mr. Arsenio reviewed the recommendations made to the council, and he stated they felt that the actions taken by the city have been satisfactory. They, therefore, recommend that the council disband the committee for a job well done. Mr. Douglas Gerard, Executive Dean -at California Polytechnic State University, submitted a report dealing with the Housing Element stating that the members of the University staff have been working with members of the city staff, and their commissions, to develop mutually agreeable criteria as the city moves towards completion of the review of the proposed General Plan. He continued that inasmuch as the Housing Element of the General Plan is to be reviewed in public hearing, this letter constitutes endorsement by the University of that portion of the Housing Element referencing the campus, specifically Problem 9. The specifics of the Program B of Problem 9 state, "B. Request of the State Legislature and the California State University and Colleges Board of Trustees that the enrollment at Cal Poly San Luis Obispo be limited to no more than 16,000 individual students. Enrollment levels in excess of this would require an environmental impact report." Dean Gerard stated that the University concurred in the enrollment limitation of 16,000 individuals, and asked that in the future, all discussions dealing with the University agree upon the ceiling of 16,000 individuals. They would appreciate notification of any time the council wishes to discuss matters with them. Communication from the San Luis Obispo Chamber of Commerce stating that the legislative division of the Chamber has been studying the proposed Housing Element of the General Plan and will have complete recommendations to the council within 30 days. 1 1 1 City Council Minutes February 13 , 1979 Page 3 There was one point that the Chamber -feels they must strongly oppose prior to their report being presented to the council because-of its danger to the well -being of San Luis Obispo. The Chamber totally disagrees with the proposed policy of. limiting business development and expansion during times of tight housing supply. For.the.past.six years, the Chamber.has.been working to expand business..and the economic base of the city of San Luis Obispo within the environmental, resource, and housing_limitations of the city. They feel they have been very successful at expanding-business in the city without putting-any.-undue-pressure -on housing.or ° -the..environment. For example, the Chamber stated that.tourism has.expanded 100 percent in the past six years' which has increised.its hiring of unemployed and underemployed minimum wage workers who already live in.the city. Very few people have moved to San Luis Obispo because of this expansion in tourism, and this expan- sion has caused no pressure whatsoever on housing. Similarly, the Chamber has brought to San Luis Obispo several.non- polluting, light.industries who have predominately hired people already - living in the community. In these instances, many -of the employees do not even live within the city of San Luis Obispo, but live in other outlying areas. He also stated.that.the expansion of the private sector of the economy in San Luis Obispo has definitely not.been a cause -of housing shortages and further expansion.should not be limited by the General Plan. Considering that sale's tax revenue is the city's largest single source of income, business expansion within resource constraints should continue to be encouraged. A communication-from the Housing Authority of the city and county of San Luis Obispo informing the City Council that the Housing Commission is generally concerned with many of the problems which have been identified in.the Housing Element of the General Plan. They felt that - their' fundamental concern, however, was with the proposed policies and.programs which address.the city's housing assistance needs. The Housing Commission fully supports the policies ' being proposed under Problem 10 - Assistance Needs and Problem ll .- Site Availability. They felt the adoption.of these.policies would provide the city with the framework it -must have in order to adequately address the city's housing assistance needs. In reviewing the .Housing Element, the Housing Authority, has. attempted to look at the 'programs from two perspectives. The Commission has reviewed these programs with respect to both.their short and long term effectiveness. They believe that viewing these programs in this,manner.is_very.:important:.- They have.concluded that the.proposed programs involving ..surplus land are short term programs with a.limited impact, but the proposed programs in 10C, 10D, and 11A are long',term programs which can potentially.have a.more moderate impact.- The Commission supports and .recommends the'adoption of both these short and long term programs, they also recommend that the Council.consider the adoption of an additional program, for which they.have piovided a program description and justification. The program, which they are proposing, would essentially.involve:'the city in a land banking.role in which the city would purchase lan and hold-it until the.Housing.Authority was ready to.proceed with some type of a housing assistance program. Finally, the Housing Commission felt that these are very difficultaproblems before the City Council but urged that the council act on these. issued and in doing so, to help.with.resolving the City of.San Luis Obispo's serious housing problems. ' The program.presented.by the Housing Authority is. as follows:. "The city will - initiate a land acquisition program which focuses on acquiring sites suitable for assisted housing.- Land - acquired and held by.the city will be.made• available at fair market values.for future resale to either private or public sponsors of assisted housing." On motion of Councilman Settle, seconded by'.-Councilman Jorgensen, that the City Council accept the final report.of.the"Ad -Hoc City -Cal Poly Student Housing Committee, thank them for their efforts, and-'authorize the Mayor to send a letter of thanks. City Council Minutes February 13, 1979 Page 4 Motion carried on the following roll call vote: AYES: Councilmen Settle, Jorgensen, Dunin, and Mayor Schwartz NOES: None ABSENT: Councilman Petterson ' Mayor Schwartz declared the public hearing open. Problem No. 3: Rent Inflation. Rents may be rising faster than landlord's costs, especially for mobile home parks and older apartments which have advertised purchase or construction loads. Policy: Increase the supply of rental housing in San Luis Obispo. Walt Lambert, Cal Poly Off- Campus Housing Coordinator, felt that rent controls were inevitable for the City of San Luis Obispo. He felt it was coming and he felt the City Council should be ready for it and adopt proper rules and an organization to handle this additional work. He felt rent controls would be a way of controlling speculation in housing supply. Rosemary Green, realtor and long time resident, stated she was opposed to rent control as she does not feel it has been successful in any place it has been enacted. She also felt the problem in the mobile home parks might be that owners do not itemize the monthly rent including the rent, utilities, taxes, etc. Tom Schuman, advisor to the Tenants' Coalition, felt that rent controls could be successful if the ordinance has teeth in it for enforcement and strong enforcement demanded. He felt any such ordinance should be strickly enforced. He felt that many areas in the state are now under rent control and have been I unsuccessful because no one enforces the provisions. Liz Fisher stated she does not feel that the recommended policy of increasing the supply of rental properties in the city would help but that rent controls are the only answer to solve the city's housing problems. Don Patrick, realator, opposed to rent control as he does not feel it has ever worked or help solve housing problems. Walter Ross, realtor, builder, and appraiser, opposed to rent controls. Felt the problem in the report was poorly written and that whoever wrote it had a lack of understanding of what was happening in San Luis Obsspo, or that the person who wrote it was ignorant to the economic principles involved in purchas- ing and paying for property. He felt the real solution was to increase the supply of rental housing and to allow a fair return on the investment. Rosemary Green again stated that all the information asked for by the council on property transactions, sales, tranfers, costs, etc. are available on a weekly or monthly basis of all transactions in the county, and these were available to the city staff if they were interested. Alice Kemper, financial consultant, stated that she would advise her clients not to buy any investment property within the city of San Luis Obispo with the spector of government rent controls being put on. She felt that all govern- ment rent control programs have not been successful in the past as the people ' involved are incapable of understanding the problems of economics involved in the programs. Rose McKeen, realtor, opposed to generalizations like condemning realtors, speculators, builders, renters, property owners, etc. She felt it was bad to compare San Luis Obispo with Los Angeles, City of Davis or Berkeley. She felt the problems should be. solved locally by the people living in the community and not with a program that would hurt the small investor and not hurt the renter. City Council Minutes February 13, 1979 Page 5 Will Behan, realtor, felt that the key issue in realestate was inflation, and until inflation is brought under control, things are going to get worse. Also, due to the lack of availability of land, it artificially increases value of whatever land and buildings are already here. He felt that the economic principle of supply and demand should be allowed to react in the community. He felt that rent control would reduce the supply of new housing due to lack of availability of risk capital for new buildings. He stated rent control would just force buildings to deteriorate due to high mortgage payments ' and maintenance, and that this would be the first cut made by owners in order to stay even. 9:00 p.m., Mayor Schwartz called a recess. 9:15 p.m., the meeting reconvened, all Councilmen present except Councilman Petterson. Problem No. 4: Housing Cost - Inflation. The cost of housing is increasing faster than incomes. Policy:- To minimize the city effected cost components of housing in all price ranges. Tom Schuman again stated he was a very strong supporter of rent controls in the city as a savings to the renters. This savings then would be spent in other areas, such as for food, clothing, automobiles, etc., which he felt would help the business people in the city and not the out -of -town owners and speculators of rental properties. He also felt that rent control would slowly reduce the price of housing so that only non - speculators would be purchasing housing. Charles W. Long, representing the Hotel /Motel Owners Association, stated that the question before the council was whether the city was going to have ' government control housing or allow the present free enterprise system to flourish. He felt that rent increases would happen from either form or system. He referred the council to look at what happened on the water bills a while back when the water system went on a pay -as- you -go basis, the water rates doubled so the water system could be maintained. He felt this should be applied to housing. He said that if the City of San Luis Obispo owned or controlled large blocks of housing and on the basis of control, cost, and upkeep, rents would have to be increased to stay ahead of inflation and repairs. Also, - governmental agencies use tax dollars to purchase or lease housing property and there is the ever cost of maintaining these projects. Housing costs can be reduced by reducing costly water hook -up fees. The average single - family lot, 50' X 150', costs approximately $1,000 to hookup to the water system. Income for the city should come out of the sale of water to the home owners just like the utility companies. He also felt that the Archi- tectural Review Commission was driving up the cost of housing through long delays in approving -plans and making unreasonable and additional demands on builders. He felt the A.R.C. has no set guidelines. While all these people may be highly qualified in their respective fields, but to have each one suggest and make demands that property be developed a certain way, is very costly and very frustrating to the developer. These added costs all end up with the home owner footing the bill. After passage through the Planning Commission, staff, and City Council and meeting all building and fire codes, it's a wonder anything gets built within the city. Charles Long continued that he knew the staff became very frustrated in trying to get a project through the A.R.C. when staff even feels the project is meeting all required stipulations. He also felt there were delays elsewhere so as not to hurt the feelings of anyone on the A.R.C., City Council, or Planning Commission. He felt the community could get along without the A.R.C. He continued that the developer is still being condemned by many groups in the city. He asked who would develop new land into housing areas and shopping centers if someone didn't invest, money. He concluded by saying that after studying the proposed Housing Element, the city would really be getting into the realestate business•if they became involved in land banks and control of individual houses. He doubted if the•city would be qualified to operate a- realestate business or if they could make money at it. He felt City Council Minutes February 13, 1979 Page 6 then-the city would become'a. speculator using-tax dollars so that citizens would be paying at both ends of the problem. He stated that city government has enough to do to run the city as efficiently as possible, which is question- able, and leaves the housing ind-everyday requirements to the private sector. America needs less regulatory laws and'more do It for "yourself citizens. Russ Johnson, property owner, opposed - to.the Housing Element in general as he personally supported the free enterprise system and.not government controls on housing, rents, etc. Walt Lambert again stated that the City Council should direct the various city commissions such as the Architectural Review Commission, Planning.Commis- sion, and even the staff to try and held developers develop within the rules of the city and not to establish obstacles to harass and delay building construction. He stated that as a former member of city's Ad -Hoc Housing Committee, he did not feel that the council had given staff or commissions this direction to cooperate with-people who..were developing.land.in.an attempt to make.money but also to'attempt to help keep the costs down. He - .concluded by saying he did not feel that at any time did the City Council in office at the time, been given as opportunity to review the "Ad -Hoc Committee's recommendations and proposals, which the staff claims have been included in this Housing Element but which he as a former member finds hard to locate. He would support the concept of Problem No. 4. Phil Humphrey, Vice-President-of Cal Coast Construction, stated he felt he would support Problem No. 4 and the policy to minimize the city effected cost.co.ponents of housing in all price .ranges. He felt'a large percentage of the-cost in building homes in San Luis Obispo.was caused by the excessive city rules and regulations. He felt the city standards are very costly and difficult to comply with. For example, he felt the minimum lot of 6,000 square feet maybe should be .reduced to•4,000.square feet which would allow more dwellings, although smaller, per acre. He felt this type.of construc- tion might allow the city to grant higher densities at.a.per square foot reduction in cost. He explained to the City Council.that.one of the most expensive operations which adds a tremendous cost to a project.is. the time it takes to process a development through the various city agencies to` culmination. Particularly, due to the change of minds of various staff members "who require four to five revisions of plans prior to even'going before the A.R.C., E.R.C., Planning Commission, etc. He felt that.time was money and each revision was-costly because one staff member.makes a change then other changes have to be-made in the entire plan, you just don't "change one lot without effecting all the other lots in the development. Each one of these changes must be returned to the architect or engineer to reengineer. He felt, in his own case, it cost over $8,700 per lot for 93 lots due to..goverrimental regulations, this did not include profit. He urged that the City Council attempt to encourage an attitude of cooperation with'the city staff, "not to require obstructions to plans as it seems to be.the policy at this time. By these statements, he did not wish the council to feel that he wished slipshod types of construction. Rules and regulations were fine, but the attitude of-cooperation and being able to sit down and discuss things with the .same staff member might make things easier. The way it is now, each individual staff member has-his own little favorite way of developing property and each one requires a. separate and distinct change in the plans. Henry Engen, Community Development Director, again reviewed.for the City Council the steps that a. developer, builder,'or :.other..person must go.through in the city regulatory area before a final development--can be made. He stated that in addition to processing requirements-dnd standards imposed by private lending institutions,..state...arid federal governments, the city has several review procedures which.may.or may not.effect the given development. He stated there was no typical project. The least complicated development would be construction of a single family residence on land with all services .and proper-zoning which would requite -only a building permit. The -most complicated development would involve annexation, General Plan amendments, Specific Plan preparation, rezoning; environmental impact report, and subdivision map. He stated that in some cases these steps could occur 1 i' 1 City Council Minutes February 13, 1979 Page 7 simultaneously, so the total time used in project review was not neces- sarily the sum of all the -time required for individual aspects. However, he agreed that if preapplication conferences with city staff and the complications of review by state and federal agencies are included, the time from project conceptualization by the developer and final approval by the city, could go to several years. Problem No. 6: Competition for Land. Residential and nonresidential uses compete for available land in the city. Nonresidential uses occasionally have an economical advantage. Policy : In decisions where residential use is a suitable option, based on land use and environmental condition, favor it over other uses in deciding on use permits and rezoning proposals. No on appeared before the City Council for or against Problem No. 6. Problem No. 9: Induced Housing Demand. Enrollment, employment, and business opportunities are drawing residents from outside the county to San Luis Obispo faster than the housing stock has been or is likely to be able to expand. Policy: Institutional, industrial, and commercial, including tourism, expan- sion will be discouraged until housing supply can catch up with the present employment base. No one appeared before the City Council for or against Problem No. 9. The matter was to be continued to the next public hearing on February 27, 1979. There being no further business to come before the City Council, Mayor Schwartz adjourned the meeting. I Approved by City Council on: April 17, 1979 J . Fitzpatrick, City Clerk Minutes of Saturday, February 17, 1979 at 9:00 a.m, were held in Executive Session and are held by the City Clerk. M I N U T E S REGULAR MEETING OF THE CITY COUNCIL CITY OF SAN LUIS OBISPO TUESDAY, FEBRUARY 20, 1979 - 7:00 P.M. COUNCIL CHAMBERS, CITY HALL, 990 PALM STREET SAN LUIS OBISPO, CALIFORNIA Pledge Roll Call Councilmen PRESENT: Ron Dunin, Jeff Jorgensen, Steve Petterson, Allen Settle, and Kenneth E. Schwartz ABSENT: None City Staff PRESENT: Leland Walton, City Administrative Officer; J.H. Fitzpatrick, City Clerk; George Thacher, City Attorney; Henry Engen,