HomeMy WebLinkAboutMINUTES - 12081992 - IO.5 TO: BOARD OF SUPERVISORS 1 .0.-5 F._ F Contra
FROM: INTERNAL OPERATIONS COMMITTEE
Costa
County
+�z
9:a O
DATE: November 30, 1992
SUBJECT: REPORT ON THE IMPLEMENTATION OF THE FINAL REPORT OF THE
HOUSING TRUST FUND TASK FORCE AND FORMATION OF AN INTERIM
HOUSING TRUST FUND ADVISORY BOARD
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS:
1 . Create an Interim Housing Trust Fund Advisory Board with seven
seats, as follows :
1 . A representative from Contra Costa cities, to be
nominated by the Contra Costa Mayors ' Conference.
2 . A representative from the local building industry.
3 . A representative of nonprofit affordable housing
developers .
4 . A representative of housing advocates, preferably
from the League of Women Voters .
5 . A representative of the real estate industry.
6 . A representative of financial institutions .
7 . A representative from the County.
2 . Charge the Interim Housing Trust Fund Advisory Board to work
with the Board of Supervisors, cities in Contra Costa County
and the Community Development Department to accomplish the
following tasks :.
* Outline and develop a preliminary strategy for securing
the public support necessary to implement the revenue
sources selected to capitalize a Contra Costa County
Housing Trust Fund.
* Further define the appropriate institutional and
operating structure for the Housing Trust Fund, and work
with the Board of Supervisors and, if appropriate, other
jurisdictions to establish the Housing Trust Fund as a
legal entity authorized to accept and allocate resources
for affordable housing development in Contra Costa
County.
CONTINUED ON ATTACHMENT: X YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRAT RECOMMENDATION OF BOARD COMMITT
APPROVE OTHE
SIGNATURE(S): SCHRODER SUNNE WRIGHT McPEAK
ACTION OF BOARD ON - Dece6lSer 8 , 1992 APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
-UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.
ATTESTED �, / / 9
Contact: PHIL BATCHELOR.CLERK OF THE BOARD OF
cc: See Page 3 . SUPERVISORS AND COUNTY ADMINISTRATOR
L
BY r DEPUTY
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I .O.-5
* Develop recommendations concerning specific policies,
programs, and funding criteria to guide the allocation of
Trust Fund revenues to improve home ownership
opportunities for low and moderate income households and
assist very-low income households to obtain affordable
rental housing.
* Explore in more detail the City of Modesto' s equity share
program as outlined in the attached report and determine
to what extent such a program could be implemented in
Contra Costa County.
* Determine whether and to what extent the Housing Trust
Fund can provide priorities in funding for current
residents of the County and for employees of public
agencies which are located in the County.
3 . Direct the Community Development Director to solicit
applications/nominations from each of the above groups or from
individual firms where an association does not exist which
represents most members and return to the 1993 Internal
Operations Committee by February 1, 1993 with the names of all
applicants/nominees so the Committee can determine which
individuals to recommend to the Board of Supervisors for
appointment.
In addition to specific group representation, members of the
Interim Housing Trust Fund Advisory Board should be
knowledgeable and concerned about the affordable housing needs
of low and moderate income households in Contra Costa County.
The final appointees should also provide adequate geographic
representation and should also be able to provide technical
expertise in affordable housing development or other related
areas .
4 . Agree that once the revenue sources for a Housing Trust Fund
are identified and secured and the Housing Trust Fund has been
legally established, a new, permanent Housing Advisory Board
should be created.
5 . Remove this matter as a referral to the 1992 Internal
Operations Committee and instead refer it to the 1993 Internal
Operations Committee.
BACKGROUND:
On August 4, 1992, the Board of Supervisors acknowledged receipt of
the final report of the Housing Trust Fund Task Force, abolished
the Task Force, and agreed in concept to the formation of a Housing
Trust Fund Advisory Board. The Community Development Department
was asked to recommend to our Committee the specific charge, size,
composition and list of potential members for such an Advisory
Board.
On November 30, 1992, our Committee met with Jim Kennedy and
Kathleen Hamm from the Community Development Department and Guy
Bjerke from the Building Industry Association (BIA) and reviewed
the attached report in some detail .
The above recommendations resulted from our discussion and are
substantially similar to the recommendations made to our Committee
by staff. It was noted that Supervisor McPeak had also received
letters from the City of Pinole and the City of Hercules and that
staff had also received a letter from the City of San Ramon which
was not originally included in the attached report. Staff noted
that the cities were unanimously opposed to increasing tipping fees
at the landfill or transfer station in order to provide funding for
a Housing Trust Fund. Letters from individual cities were reviewed
and their comments noted.
2
I .O.-5
Supervisor McPeak noted that she was most interested in many
features of the City of Modesto's Program. Mr. Bjerke noted that
BIA is opposed to the standard type of inclusionary program as it
has been proposed or implemented elsewhere. Our Committee also
indicated that it should be the intent of the Board of Supervisors
to appoint a representative of the League of Women Voters to the
seat designated for housing advocates .
cc: County Administrator
Community Development Director
Jim Kennedy, CDD
County Counsel
Auditor-Controller
3
CONTRA COSTA COUNTY
COMMUNITY DEVELOPMENT DEPARTMENT
DATE: November 30, 1992
TO: Internal Operations Committee
Supervi r Rob I. Schroder
Sup �Vtin a Wright McPeak
FROM: Jim K nedy
Dep Direct - Redevelopment
SUBJECT: Fc�.low- o Internal Operations Committee Report on Housing Trust
nd
On August 4, 1992, the Board of Supervisors accepted the Report of the Internal Operations
Committee (IOC) on the Final Report of the Housing Trust Fund Task Force. That report
directed the Community Development Department to perform the following tasks:
o Report to the IOC on a proposed charge; size, composition, and list of potential members
for the Housing Trust Fund Advisory Board.
o Obtain comments from the Contra Costa Transportation Authority and cities on their
preferences among the three revenue sources proposed for the Housing Trust Fund.
o Review the concept of inclusionary housing programs, including the program
implemented by the City of Modesto, discuss with representatives of the Building
Industry Association, and provide comments or recommendations to the IOC.
This report details the Department's progress in accomplishing each of these tasks. Staff
recommendations and report highlights are summarized in the following.
I. RECOMMENDATIONS AND FINDINGS
o Staff recommends that the Board of Supervisors appoint an Interim Housing Trust
Fund Advisory Board to:
1. develop an implementation strategy for revenue sources selected to capitalize the
Housing Trust Fund;
2. work with the Board of Supervisors to establish the Trust Fund as a legal entity;
and
3. recommend policies, programs, and criteria to allocate Trust Fund revenues
within the context of Board priorities.
o Staff recommends that the Interim Housing Trust Fund Advisory Board consist of
seven members representing Contra Costa Cities, the local building industry, nonprofit
housing developers,non-profit housing advocates the real estate industry, financial
institutions, and the County.
o The Contra Costa Transportation Authority deferred to the Mayors' Conference and
individual cities with regard to formal comments on the Housing Trust Fund.
o The Mayors' Conference expressed unanimous opposition to increases in landfill
tipping fees; no comments were offered on the other funding sources.
o Correspondence was received from the cities of Antioch, Concord, Martinez, and
Walnut Creek. The cities of Walnut Creek and Antioch supported the concept of a
general obligation bond to provide resources for a countywide Housing Trust Fund.
While Concord was neutral. Each of the four cities oppossed landfill tipping fees.
Martinez inquired about the organizational structures of the Trust Fund.
o The Building Industry Association is not generally in favor of inclusionary housing
programs as a means of increasing affordable housing.
o Over 48 California jurisdictions have implemented inclusionary housing programs.
1. Target populations for these programs include very-low, low and moderate
income households.
2. Requirements for the inclusion of affordable units in new developments range
from 5 to 35 percent, with the majority falling in the 10 to 15 percent range.
3. Required terms of affordability range from zero to perpetuity; majority of
programs require 30 years.
0
4. In lieu fees are an option in most programs; fees range from $2,100 to over
$18,000 per unit.
5. Most programs offer developer incentives, including density bonuses, fee waivers,
relaxed design standards, and fast tracking.
o The City of Richmond is the only City currently implementing an inclusionary housing
program in Contra Costa County.
o The City of Modesto has adopted an equity share program for first-time homebuyers.
The program charges a fee for each housing unit built in excess of 800 square feet. The
fees are used to provide silent seconds to first-time homebuyers at market interest. Upon
resale, the City receives the amount of the loan, interest, and a share in unit appreciation.
II. CONTRA COSTA COUNTY HOUSING TRUST FUND INTERIM ADVISORY
BOARD
A. Responsibilities
Staff recommends that the Board of Supervisors create an Interim Housing Trust Fund Advisory
Board to further refine and assist in implementing the recommendations contained in the Final
Report of the Housing Trust Fund Task Force. The Interim Advisory Board should be
responsible to the Board of Supervisors and work with the Board, Contra Costa Cities, and the
Community Development Department to accomplish the following tasks:
1. Outline and develop a preliminary strategy for securing public support necessary
to implement the revenue sources selected to capitalize a Contra Costa County
Housing Trust Fund;
2. Further define the appropriate institutional and operating structure for the Housing
Trust Fund, and work with the Board of Supervisors and, if appropriate, other
jurisdictions to establish the Housing Trust Fund as a legal entity authorized to
accept and allocate resources for affordable housing development in Contra Costa
County; and
3. Develop recommendations concerning specific policies, programs, and funding
criteria to guide the allocation of Trust Fund revenues to improve homeownership
opportunities for low and moderate income households and assist very-low income
households to obtain affordable rental housing.
B. Structure
Staff recommends that the Interim Housing Trust Fund Advisory Board be appointed by the
Board of Supervisors and consist of seven members representing the following groups:
1. Contra Costa Cities;
2. local building industry;
3. nonprofit affordable housing developers;
4. aoapm& housing advocates;
5. real estate industry;
6. financial institutions; and
7. the County.
In addition to specific group representation, Interim Board members should: be knowledgeable
and concerned about the affordable housing needs of low and moderate income households in
Contra Costa County; provide adequate geographic representation; and have technical expertise
in affordable housing development or other related areas.
Staff has deferred formal solicitation of individuals interested in serving on an Interim Advisory
Board pending approval of the recommended structure and responsibilities by the Board of
Supervisors. Informal discussions and expressions of interest by possible participants have
occurred. The core of the intrest has been expressed by Housing Trust Fund Task Force
members.
C. Permanent Housing Trust Fund Advisory Board
Once the revenue sources for a Housing Trust Fund are identified and secured and the Housing
Trust Fund legally established, a new, permanent Advisory Board should be created. As
recommended by the Housing Trust Fund Task Force in their final report, if the Trust Fund is
3
capitalized solely with inclusionary in-lieu fees from the unincorporated area of Contra Costa
County, the Housing Trust Fund Advisory Board should be appointed by and responsible to the
Board of Supervisors. Alternatively, if the Housing Trust Fund also includes revenues from
countywide resources (e.g., general obligation bond, landfill tipping fee), then the Housing Trust
Fund should be jointly controlled by Contra Costa Cities and the County.. A Housing Trust
Fund Authority composed of elected City and County officials or their..representatives should
be established as a separate legal entity authorized to make decisions on Trust Fund policies and
project funding. The Authority should be assisted by a Housing Trust Fund Advisory Board.
The recommendations of the Housing Trust Fund Task Force should serve as the starting point
for the Interim Advisory Board in their efforts to develop detailed recommendations on the
structure and responsibilities of a permanent Housing Trust Fund Advisory Board. A summary
of Task Force recommendations is included with this report as Attachment A. As its final task,
the Interim Advisory Board should assist the Board of Supervisors (and other jurisdictions, if
appropriate) to recruit qualified members for the permanent Housing Trust Fund Advisory
Board.
M. CITY PREFERENCES AMONG PROPOSED REVENUE SOURCES
As directed by the Board of Supervisors, Contra Costa Cities, the Mayors' Conference, and the
Contra Costa Transportation Authority were asked to comment on the revenue sources
recommended for creation of the Housing Trust Fund.
A. City Comments
Based on the view that landfill tipping fees in Contra Costa County are high relative to those in
other jurisdictions, City representatives attending the Mayors' Conference were unanimous
in their opposition to increases in tipping fees to support affordable housing development. No
comments were offeied on the use of general obligation bonds or inclusionary housing in-lieu
fees to capitalize a Housing Trust Fund.
In additional correspondence, the cities of Walnut Creek and Antioch stated that they would
support a general obligation bond to provide resources for a Countywide Housing Trust Fund,
but would be opposed to increased landfill tipping fees. The City of Walnut Creek also
supported the concept of an inclusionary program and the Task Force recommendation that the
Housing Trust Fund should be jointly controlled by Contra Costa Cities and the County if funds
are provided from countywide sources.
The City of Concord indicated their concurrence with the views expressed by the Mayors'
Conference. In addition, Concord is neutral on the use of general obligation bonds and
inclusionary fees in the unincorporated area for affordable housing purposes.
The City of Martinez staff forwarded a series of questions regarding the specific organization
and operational structure of a Housing Trust Fund. Additional comments included concerns that
landfill tipping fees were already high and that an inclusionary program would further increase
the cost of providing housing in Contra Costa.
Copies of the City letters are included as Attachment B.
4
B. Contra Costa Transportation Authority
The Executive Director of the Transportation Authority has indicated that they will defer to the
Mayors' Conference and individual cities with regard to formal comments on the Task Force
Final Report and recommended revenue sources. However, Transportation Authority members
have expressed interest in a joint workshop with the County and the Mayors' Conference to
discuss implementation policies with regard to affordable housing.
IV. INCLUSIONARY HOUSING PROGRAM
In its final report, the Housing Trust Fund Task Force recommended that the Board consider an
inclusionary housing program with an in lieu fee component as a potential revenue source for
a Contra Costa County Housing Trust Fund.
A. Program Definition.
Inclusionary programs are intended to increase the supply of affordable housing in a jurisdiction
by requiring that a specified percentage of residential units in new housing developments be
affordable to lower income households. As an alternative, the majority of inclusionary programs
in California permit the payment of a fee for each unit of market rate housing developed in lieu
of construction of the affordable units. These fees are then typically used to support the
development of affordable housing in other locations and projects.
B. Policy Issues.
Creation of an inclusionary housing program in Contra Costa County will require resolution of
the following policy issues:
1. Definition of affordability and the target population;
2. Program threshold/minimum size development required to comply with
inclusionary requirements;
3. Percent of newly constructed units required to be affordable;
4. Term of required affordability, including resale restrictions;
5. Design considerations;
6. In lieu fee option;
7. Additional alternatives to the provision of affordable units;
8. Developer incentives and offsets.
These policy issues and the range of alternatives employed by 48 California jurisdictions with
an inclusionary program are summarized in Table I (page 6) and discussed in greater detail in
Attachment C.
C. Revenue Potential
The revenue potential of an inclusionary housing program in unincorporated Contra Costa
County will depend on the definition of affordability, project threshold, percent of units required
to be affordable, and the size of the in lieu fee option chosen for the program. Initial estimates
prepared by the Consultant for the Housing Trust Fund Task Force suggest that a $1,000 per
unit in lieu fee for single family homes would generate $1.6 million per year. These estimates
are based on
5
average annual single family housing production in the unincorporated area of 1,600 units per
year and the following assumptions: all units built are priced above the affordability target; all
units built are in developments which exceed the program
threshold; and all developers chose to pay the fee in lieu of including affordable units in the
project. If annual housing production declines, a portion of the new units fall within the
affordability targets or are built in developments smaller than the program threshold, or some
developers agree to build the required affordable units rather than pay the fees, then the fee
revenue from the inclusionary program may be significantly less.
D. Implementation Authority
Implementation of an inclusionary housing program in the unincorporated area can be
accomplished by action of the Board of Supervisors through amendments to the County Zoning
Ordinance.
E. Inclusionary_Programs in Contra Costa County.
Although a formal program has not been established, there is some precedent for creation of an
inclusionary housing program with an in lieu fee component in the unincorporated area of Contra
Costa County. The County required in the Development Agreements for two proposed single
family residential projects in East County and one project in Central County to contribute an in
lieu fees of$3,333 for each market rate unit developed. The in lieu fees are to be.deposited in
a trust fund for use in expanding the supply of affordable housing in Contra Costa. If the
County wishes to pursue this approach, it may be desirable to adopt a formal inclusionary
housing requirement to be applied to all future residential developments.
In addition to the County activity, a number of Contra Costa cities including Clayton, Danville,
Pleasant Hill, and San Ramon, have expressed interested in establishing inclusionary programs.
However, the City of Richmond is the only jurisdiction in the County actually implementing an
inclusionary program. The City has adopted specific policies with regard to inclusionary
requirements and is currently considering a draft ordinance. Pending adoption of the ordinance,
the City intends to apply the inclusionary requirements to all new housing developments which
meet specified criteria.
Under the Richmond program, all new developments containing 10 or more residential units are
required to fulfill one or more of the following inclusionary requirements:
1. a minimum of 15 percent of the total housing units must be affordable to low
income households;
2. a minimum of 10 percent of the units must be affordable to very-low income
households;
3. a minimum of 12.5 percent of the units must be affordable to a combination of
low and very-low income households; or
4. a minimum of 25 percent of the units in a senior housing project must be
affordable to very-low or low-income households.
Affordability requirements are recorded as deed restrictions on the property. Required terms
of affordability are 10 years for rental units and 20 years for homeowner units. The resale price
6
of homeowner units during this period is limited to the original acquisition price adjusted for
increases in area median income.
As an option to the above inclusionary requirements, developers may elect to provide a
minimum of 15 percent of the units at rents or prices affordable to moderate income households.
In order to qualify for this option, developers must show that compliance with requirements to
provide units affordable to very-low and low-income households would render the project
infeasible and agree to pay an in lieu fee for each inclusionary unit. The size of the in lieu fee
is determined by formula and depends on the number of bedrooms in the unit and the difference
between the income of a household at 120 percent of AMI (moderate income) and that of a
household earning 80 percent of AMI (lower income). Currently, the in lieu fee for a 3-
bedroom home is $18,326 per unit. Assuming the inclusionary requirement for a project was
10 units, in lieu fees would total $183,260.
In addition to the in lieu fee option, the Richmond program offers the following developer
incentives and off-sets: density bonus of one additional unit for each inclusionary unit up to a
maximum bonus of 25 percent over existing zoning; flexibility in development standards,
including open space requirements, landscaping, parking, and minimum lot size; consideration
of mixed-use zoning to improve feasibility; assistance in obtaining federal or state subsidies; fee
waivers; and fast-track processing.
F. Modesto Housing Pro ram
The City of Modesto has adopted an equity share program for first time homebuyers in the
Village One Specific Plan Area. This program will be funded through fees paid by developers
building single family homes in the specific plan area. A fee exemption for units affordable to
low-income households (defined as having less than 800 square feet) is similar to an inclusionary
program in that it provides an incentive for developers to include affordable units in residential
construction projects. Developers who build units larger than.800 square feet will be required
to pay a fee for each unit equal to $0.80 times the number of square feet in the unit over 800
(e.g., the fee on a 1,000 sq. ft. house would be $160, while the fee on a 3,000 sq. ft. house
would be $1,760). This program differs from inclusionary programs in that fees are levied on
all units which do not meet the City's definition of affordability. As an alternative to the fee
payment, developers could provide affordable housing, assuming it is equivalent in scope and
value to the housing assistance offered through the equity share program.
Following initiation of construction in the Village One area, fees paid by developers will be
deposited in a Housing Trust Fund for use in providing assistance to low and moderate-income
first-time homebuyers who are unable to obtain adequate mortgage financing on their own. The
program will provide silent second loans to pay for closing costs, a portion of the downpayment,
or to finance the gap between the first mortgage and the homeowner's total financing needs.
The interest rate on the silent second will equal prevailing rates at the time of the loan, with
payment of principle and interest deferred to the sale or refinancing of the unit. In exchange
for the loan assistance, the City receives an equity share in the property. Upon resale, the City
is repaid the amount of the silent second plus accrued interest plus its share of unit appreciation.
Loan repayments will be deposited in the Housing Trust Fund for use in making additional
loans.
7
G. Building Industry Association Comments on Inclusionary Housing`Progr, am
Staff met with Guy Bjerke to discuss the views of the Building Industry Association on
inclusionary housing programs. Mr. Bjerke stated that the Association is not generally in favor
of this type of program because it places the burden of subsidizing affordable housing on
developers and buyers of new housing. The Building Industry Association would prefer an
approach which would provide a more equitable distribution of the burden of meeting Contra
Costa County's affordable housing needs.
8
Attachment A
CONTRA COSTA COUNTY HOUSING TRUST FUND
RECOMMENDED INSTITUTIONAL STRUCTURE
Housing Trust Fund Task Force recommendations concerning an appropriate administrative and
institutional structure for the Housing Trust Fund depend on the specific revenue sources
ultimately adopted.
o County Only Revenue Source - If inclusionary funds from the unincorporated area
represent the only revenue source, then the Task Force recommends that the Housing
Trust Fund be controlled by the County.
o Countywide Revenue Source - Alternatively, if the Housing Trust Fund also includes
revenues from countywide sources (general obligation bond, landfill tipping fee), then
the Task Force recommends shared control of the Housing Trust Fund by Contra Costa
cities and the County.
Depending on the revenue source(s) ultimately approved for the Housing Trust Fund, the Task
Force adopted the following recommendations concerning institutional structure:
County Only Revenue Structure
1. The Housing Trust Fund should be controlled by the Board of Supervisors with an
Advisory Board. Housing Trust Fund Advisory Board responsibilities:
a. develop policy recommendations and program criteria consistent with priorities
established by the Board of Supervisors;
b. review project proposals and make funding decisions.
2. Advisory Board recommendations on major policy issues and the allocation of funds
should be forwarded to the Board of Supervisors for ratification by majority vote.
3. The Housing Trust Fund Advisory Board should consist of nine to eleven members
appointed by the Board of Supervisors. Terms should run for three years, with no term
limits.
4. The following factors should be considered in appointing Advisory Board members:
a. knowledge and concern about affordable housing needs in Contra Costa County;
b. technical expertise in affordable housing development;
C. representation of relevant interest groups and geographic areas; and
d. sensitivity and commitment to affordable housing development, and the needs of
low and moderate income households.
Countywide Revenue Structure
1. The Housing Trust Fund should be jointly controlled by Contra Costa Cities and the
County. A Housing Trust Fund Authority composed of elected City and County officials
1
or their representatives should be established as a separate legal entity authorized to make
decisions on Trust Fund policies and project funding.
2. The Trust Fund Authority should be assisted by a Housing Trust Fund Advisory Board.
The membership, structure, and responsibilities of the Advisory Board should be the
same as those described under the county only revenue structure.
2
Attachment B
Correspondence From Cities
Antioch
Concord
Martinez
Walnut Creek
COST
PNIIOCN CP 94509a� Q
CITY HALL TH' �,�' ,Dp /:PO 130
). ) 779-�03o 'C(G j�G
(510 ctr. Y2
November 16, 1992
Mr. James Kennedy
Deputy Director Redevelopment
COMMUNITY DEVELOPMENT DEPARTMENT
County Administration Building
4th Floor
Martinez , CA 94553-0095
Dear Jim:
The Antioch City Council on November 10, 1992 considered the
recommendations of the Contra Costa County Housing Advisory Task
Force regarding the creation of a countywide Housing Trust Fund.
After review of the proposed alternative revenue sources the City
Council expressed strong opposition to increasing tipping fees to
fund governmental and social programs that have no relationship to
landfill operations. I have enclosed a copy of the proposed
resolution to be considered by the City Council on November 24,
1992 .
The City Council did endorse the concept of a general obligation
bond as a countywide source of revenue for affordable housing. If
you have any questions, please do not hesitate to call.
Sincerely,
�.o �• Lam/
DOUG LA R. WARD
Deputy Director Community Dev.
DRW/jm
8
RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF ANTIOCH REQUESTING THAT
LANDFILL TIPPING FEES BE LIMITED TO
ITEMS DIRECTLY RELATED TO SOLID WASTE
WHEREAS, the tipping fees collected at landfills in
Contra Costa County are among the highest, if not the highest,
charged in the State of California; and
WHEREAS, the tipping fees collected at landfills are
passed through to customers in their garbage collection bills; and
WHEREAS, citizens in Antioch are finding it increasingly
difficult to afford garbage collection services because of high
rates; and
WHEREAS, officials of Contra Costa County, elected and
staff, have made proposals to increase tipping fees in order to
fund various governmental and social programs that have no
relationship to garbage or landfill operations;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the
City of Antioch that the City Council urges the Board of
Supervisors to adopt a policy that programs that have no
relationship to solid waste not be funded by increases to landfill
tipping fees.
I HEREBY CERTIFY that the foregoing resolution was passed
and adopted by the City Council of the City of Antioch at a regular
meeting thereof, held on the day of , 1992, by the
following vote:
AYES:
NOES:
ABSENT:
CITY CLERK OF THE CITY OF ANTIOCH
CITY OF COMAMU CIrY CUCVCIL
1950 Pai k.idc Di i%,-. Nle I
Concord.(..ilil„i,ii:k:I I",iN:uic% G,nc.Mater
F.4\: (51ui -!,yiu,.;1i Mai k L)rSallllliel',Vice NLn'nr
B%.rnn Campbell
Coll rrn t
7 a
OFFICE OF ruk.N(.1%oit 49,ccl(). lu,l'e
(T' r
Telephcn c: (a 111) li;I-:;I",,� Ta.,! — . ?„!_,�._. E.c ��J:�trclitlCS:in \i ul r
November 19, 1992 f o
Mr. Jim Kennedy
Deputy Director - Redevelopment Nr
County Administration Building
651 Pine Street
4th Floor, North Wing
Martinez, California 94553-0095
Dear Mr. Kennedy:
The City of Concord appreciates the opportunity to comment on the Contra Costa Housing
Trust Fund Task Force Report and Recommendations.
We are committed to the provision of affordable housing for all income categories, and are
fortunate, with our Redevelopment Housing Set Aside funds, to have resources for new
programs and projects. We have also taken advantage of existing County resources for first
time home buyers, and have actively promoted your Mortgage Revenue Bond and MCC
programs within the City. Realizing that other cities in the County have been unable to meet
their affordable housing goals, we commend the County on this effort to increase the amount
of funding available for such projects.
After reviewing the proposed revenue sources, we generally share the sentiments voiced at
the Contra Costa Mayors Conference Meeting in October. To summarize,. the proposal to
issue general obligation bonds will ultimately be decided by the voters and the Supervisors
must decide whether or not to place such a proposal on the ballot. The inclusionary zoning
proposal affects only County unincorporated areas and would not likely be opposed by the
City of Concord. The landfill tipping fee, however, appears difficult to justify given the
dramatic increase in costs which rate payers have recently received.
As stated in the report, the administrative structure of the Housing Trust Fund will be
determined by the revenue sources. If the Trust Fund is capitalized with a Countywide
source of funding, the City of Concord would look forward to being a full partner in the
decision making process regarding the distribution of those funds.
Thank you again for informing us about this proposal and providing an opportunity to
comment. We look forward to working with you on this effort, and wish you success on
establishing a new Housing Trust Fund.
Sincerely,
Nano C orey
Mayor
A tfG G�wc�✓I Q
\; City of Martinez
Henrietta Street, Martinez. C.-\ 94553.2394 r !
414\1���_U Z
November 17, 1992 &o
Jim Kennedy
Contra Costa County Community Development Department
651 Pine Street
4th Floor, North Wing
Martinez, CA 94553
Dear Mr. Kennedy:
As you have requested, we have reviewed the Housing Trust Fund Task Force
Summary Report and Recommendations. The City of Martinez has the following
comments.
The report is thorough and comprehensive, but leaves several unanswered
questions. How will the program be implemented? Will the Advisory Board take
an active or a reactive role in the development of affordable housing? Will
they just review and approve projects proposed to them or will they be actively
proposing projects? If cities do not get credit for units built with the fees
collected and they are not encouraging affordable housing within their city
limits, there would be no benefit to them taking part in the program. How will
projects be selected? What will be the selection criteria? What level of
involvement shall be required of the city? On page 14, paragraph 2 states that
"use of revenue fees provided through a city program should be referred to the
City Council" for ratification. The funds from a bond or franchise fee would
not be directly provided by a city but would be collected generally from the
residents. What kinds of city programs is this referring to?
Martinez is very supportive of affordable housing, yet, there is little
property left in Martinez for affordable units. What areas remain for single
family construction are hillside lots which are expensive to develop. Martinez
has a large stock of affordable multi-family units and due to the lower land
costs, our single family developments tend to be more affordable. Presently,
the City' s energy has been directed toward rehabilitating the existing units
rather than the construction of new units.
The report discusses attempting to include the cities in the inclusionary
housing program. The price of new homes in the County is very high and we
would have concerns regarding the additional fees which would be added to home
construction costs driving the costs up for many first time home buyers and
families already on limited budgets. Developers building homes in the more
modest price ranges are more likely to include affordable units. If in lieu
fees were levied by the County, we would suggest they be on a sliding scale
relative to the cost of the home. In addition to the sliding scale fees, the
City would recommend that you look at charging a fee comparable to the actual
cost of building the affordable units.
f
As the report states the land fill tipping fee is regressive and effects the
low income person more heavily than upper income levels. The costs of garbage
collection are very high in Contra Costa County and it seems unfair to add
extra costs to the service consumer. Pluses of this source would be that it
would tax businesses as well as the home owner and the proposed tax is not a
heavy tax. Since the general obligation bond is based on the assessed value of
property, it may relate to a curved income scale. But, as noted, it is
difficult to acquire the required 2/3 voter approval.
The report indicated, though it is not stated, that the proposed plan would be
to set up the County only structure, work at incorporating the cities into the
program and then set up the countywide structure to replace the County only
structure. This would leave the cities out of the first step which includes
the formulation of implementation, policies and programs.
Once the formal structure is in place, consideration should be given to
requiring a "Super Majority" or two-thirdsvote in order to achieve
sub-regional consensus.
Thank you for giving us an opportunity to comment on the report. If you have
any questions regarding these comments, you may reach me at 372-3518.
Sincerely,
--64V"147
Barbara Bacon
Associate Planner
BB:la
230.743
COS7
qol
Inut '9-� : _.
EPT
November 12, 1992
Jim Kezmedy
Deputy Direct= of Redevelopment
Ccmmity Development Department
p, Inition Building
651 Pine Street
4th Floor-North Wing
Martinez, CA 94553-0095
sUBJF7C,T: CaNrRA com Cr0i= H7=G ZRiJST FUND
Dear Mr. Kennedy:
The City of Walnut Creek would like to thank you for the opportunity to
review and ccrmient on the report of the Contra Costa County Housing
TYvst Furxi Task Force. We ccmmend the County for its efforts to create
a countywide Housing Trust Fund to increase affordable housing
opportunities for the low and moderate u=me residents of Contra Costa
county.
The City, including the Council Housing Committee, reviewed all three
potential revenue sources identified by the Task Force for the Contra
Costa County Housing Trust. Fund: general obligation bond, inclusionary
housing program, and landfill tipping fee. The City will support
resources from both the inclusionary housing program and the general
obligation bond for the County Housing Trust Furri. However, the City
Will not support the landfill tipping fee. The c=ent solid waste
d--,=al costs in the County are already high. The City believes that
increasing this financial burden With additional landfill tipping fees
Will only have a negative result.
Walnut Creek has limited land for large develogwnts, however, the City
Will support an inclusionary housing program to e-mcurage and increase
the production of affordable housing for its low6- and moderate-i nccme
residents. The City is also aware of the difficulty in obtaining voter
approval for bond financing, especially during present manic
conditions. Considering the basic service needs a=ently facing- the
City and the Cotmty, Walnut Creek anticipates supporting a countywide
general obligation bond for affordable housing if it is the only
resource available.
P.O. Box 8039 4 1666 North Main Street + Walnut Creek, California 94596 + )510) 943-5800
0 '
Mr. Jim Kennedy
CONTRA COSTA COL4M HOMNG FUND
November 12, 1992 (Page 2 of 2)
In conclusion, the City agrees with the reco=xerZations from the C=ty
Task Force on the tine structure of the Housing Trust Fund.
If the Housing Trust Fund includes monies generated by the City of
Walnut Creek, the City would need to be involved in the decision making
process. Walnut Creekthat the City participate as an equal
partner with the County and have shared control of the Housing Trust
Fund.
If you have any questions regarding the City's cents on the proposed
C=rty Housing Trust Furxi, please contact Ms. Helen Kim, Housing
specialist at 943-5834.
Sincerely,
io
Gene Wolfe
MYCtR
cc: City Council
City Manager
CDD Director
Chief of Planning
Housing Specialist
Attachment C
INCLUSIONARY HOUSING PROGRAMS
SUMMARY OF POLICY ISSUES
Implementation of an inclusionary housing program requires the resolution of a number of
significant policy issues, including: the definition of affordability and the target population; the
program threshold or minimum size development required to comply with inclusionary
requirements; the percent of units required..to be affordable; the term of required affordability,
including resale restrictions; design considerations; the provision of an in lieu fee option,
including the size of the fee; additional alternatives to the provision of affordable units; and
developer incentives or offsets. These policy issues and the range of alternatives employed by
California jurisdictions' with an inclusionary program are discussed in the following.
o Affordability: policy decision concerning affordability defined in terms of the target
population. A jurisdiction may select different target populations for rental and
homeownership developments. Inclusionary programs in California tend to define
affordable rental units as those which are affordable to very low and/or low income
households, while affordable homeownership units are those which are affordable to low,
and/or moderate income households'. In addition to target populations, a jurisdiction
may specify the terms under which a rental or homeowner unit will be considered to be
affordable. For example, rental units may be determined to be affordable so long as
monthly rental costs including utilities do not exceed 30 percent of the target household's
gross monthly income. Similarly, a homeowner unit may be defined as affordable so
long as the monthly payment for principle, interest, taxes and insurance does not exceed
35 percent of the target household's gross monthly income.
In defining the target group and definition of affordability, a jurisdiction must consider
current market prices and the potential financial burden imposed on the developer and
other units in the planned development. For example, if affordability targets are too
deep, production of these units may create a substantial financial burden resulting in a
shift in housing development to other jurisdictions. If the targets are too high, maximum
affordable housing prices may not differ significantly from current market prices, with
the result that the program would have little or no impact on housing development.
Based on an initial analysis of housing prices in the unincorporated area, the Consultants
to the Housing Trust Fund Task Force recommended that a County inclusionary program
target low-income households for rental units and median income households for
homeowner units.
'Information on inclusionary programs in California was obtained from a report entitled California
Inclusionary Housing Survey prepared for the San Diego Housing Commission in January of 1992. In
addition, a staff survey was conducted in June and July of 1992 to identify inclusionary programs
implemented by Contra Costa cities.
2Very low-income households are defined as those earning 50 percent or less of area median income
(AMI), adjusted for family size; low-income households earn 51 to 80 percent of AMI;and moderate income
households earn 81 to 120 percent of AMI.
1
o Threshold: policy decision concerning the minimum size development required to
comply with inclusionary program affordability requirements. The threshold may
differ for rental and homeowner developments. Some California jurisdictions require all
new residential development to comply with inclusionary requirements regardless of
size, while others have adopted minimum thresholds ranging from five to fifty units.
The majority of programs have a threshold of five to ten units. Those programs which
apply to all developments or have a low threshold typically permit payment of a fee in
lieu of construction of affordable units.
o Unit Re irement: policy decision concerning the percent of residential units which
must be affordable to the target population. Requirements may differ for rental and
homeowner developments, as well as for different size developments. In California,
requirements for the inclusion of affordable units in residential developments range from
5 percent to 35 percent of the total number of units developed, with the vast majority set
at 10 to 15 percent.
o Term of Affordability: policy decision concerning the minimum required term of
affordability and applicable resale restrictions. Requirements may differ for rental and
homeowner developments. Terms of required affordability are usually recorded as deed
restrictions on the property. In California, required terms of affordability range from
no requirement to perpetuity, with 30 years as the most common term. In addition, some
jurisdictions employ a rolling affordability requirement: each time a restricted unit is
sold, the term of required affordability begins anew.
During the required term, rental units must be affordable to and occupied by households
in the target population. If the income of a household occupying an affordable unit
increases above the maximum allowable, then the next available unit must be made
available to a qualified household at an affordable rent. Resale restrictions on
homeowner units often take the form of a right of first refusal. Under this type of
program, the jurisdiction has the right to acquire or assign the right to acquire the
affordable unit to another qualified household at a specified price. The resale price is
typically limited to the original acquisition price adjusted for inflation or appreciation in
real estate values. In the event that a qualified household cannot be identified and/or the
jurisdiction elects not to exercise its right of first refusal, the current owner may sell the
unit on the open market for the current market price.
o Design Considerations: policy decisions concerning the comparability of affordable
units to the market rate units in terms of design and location. Comparability
guidelines vary substantially among California jurisdictions with inclusionary programs.
Most programs permit the developer some flexibility with regard to the size, number of
bedrooms, and interior amenities provided in the affordable units. However, in order
to avoid stigmatizing certain units as "affordable", most programs also require that these
units be similar to market rate units in exterior appearance and that they be dispersed
throughout the development. Such requirements are consistent with the County's Density
Bonus Program.
o In Lieu fee Option: policy decision concerning the payment of fees in lieu of
building affordable units. In lieu fees may be used to by the jurisdiction to support
2
affordable housing development in other locations and projects. High in lieu fee rates
will encourage the provision of the required number of affordable units in new residential
developments, while low rates will encourage the payment of fees in lieu of providing
the units. The majority of California jurisdictions with inclusionary programs permit the
payment of a fee in lieu of providing the required affordable units. The in lieu fees vary
from a low of $2,100 per unit in Coronado to a high of more than $16,600 per unit in
Davis. As of January 1992, no affordable units had been constructed in connection with
Coronado's inclusionary program, while the Davis program had produced an estimated
1,000 units.
o Additional Options: policy decisions concerning additional options to the provision
of the required units within the proposed residential development. In addition to in
lieu fees, allowable alternatives could include: off-site compliance (construction of all
or a portion of the required affordable units at alternative locations); dedication of
alternative sites for affordable housing development; use of affordable housing "credits"
earned on a prior project which included affordable units; and acquisition of affordable
housing credits from other developers. While these options increase the developer's
flexibility in meeting inclusionary requirements, they may discourage efforts to achieve
a broader distribution of affordable housing opportunities in all areas of the County.
o Developer Incentives and Offsets: policy decisions concerning developer incentives
and offsets designed to reduce the financial burden of compliance with inclusionary
requirements for affordable units. Requirements to include a specified percentage of
affordable units in a residential development may impose a financial burden on the
developer. To the degree that the developer is able to pass this burden through to other
buyers, this will result in increased prices paid by households acquiring the market rate
units. In an effort to offset this burden and facilitate the provision of affordable units
without driving market rate prices higher, jurisdictions may elect to provide a
combination of developer incentives and offsets, including: a density bonus program;
fee waivers; relaxed design restrictions for affordable units; and fast tracking through the
plan approval and permit process. Each of these programs are designed to increase
developer revenues and/or reduce costs in order to offset the burden of providing the
affordable units. California jurisdictions currently employ all of the developer incentives
and offsets listed, with density bonus programs as the most common approach.
kh/k3b/HTFIOC6
3
Attachment C
INCLUSIONARY HOUSING PROGRAMS
SUMMARY OF POLICY ISSUES
Implementation of an inclusionary housing program requires the resolution of a number of
significant policy issues, including: the definition of affordability and the target population; the
program threshold or minimum size development required to comply with inclusionary
requirements; the percent of units required to be affordable; the term of required affordability,
including resale restrictions; design considerations; the provision of an in lieu fee option,
including the size of the fee; additional alternatives to the provision of affordable units; and
developer incentives or offsets. These policy issues and the range of alternatives employed by
California jurisdictions' with an inclusionary program are discussed in the following.
o Affordability: policy decision concerning affordability defined in terms of the target
population. A jurisdiction may select different target populations for rental and
homeownership developments. Inclusionary programs in California tend to .define
affordable rental units as those which are affordable to very low and/or low income
households, while affordable homeownership units are those which are affordable to low,
and/or moderate income households'. In addition to target populations, a jurisdiction
may specify the terms under which a rental or homeowner unit will be considered to be
affordable. For example, rental units may be determined to be affordable so long as
monthly rental costs including utilities do not exceed 30 percent of the target household's
gross monthly income. Similarly, a homeowner unit may be defined as affordable so
long as the monthly payment for principle, interest, taxes and insurance does not exceed
35 percent of the target household's gross monthly income.
In defining the target group and definition of affordability, a jurisdiction must consider
current market prices and the potential financial burden imposed on the developer and
other units in the planned development. For example, if affordability targets are too
deep, production of these units may create a substantial financial burden resulting in a
shift in housing development to other jurisdictions. If the targets are too high, maximum
affordable housing prices may not differ significantly from current market prices, with
the result that the program would have little or no impact on housing development.
Based on an initial analysis of housing prices in the unincorporated area, the Consultants
to the Housing Trust Fund Task Force recommended that a County inclusionary program
target low-income households for rental units and median income households for
homeowner units.
o Threshold: policy decision concerning the minimum size development required to
comply with inclusionary program affordability requirements. The threshold may
'Information on inclusionary programs in California was obtained from a report entitled California
Inclusionary Housing Survey prepared for the San Diego Housing Commission in January of 1992. In
addition, a staff survey was conducted in June and July of 1992 to identify inclusionary programs
implemented by Contra Costa cities.
2Very low-income households are defined as those earning 50 percent or less of area median income
(AMI), adjusted for family size; low-income households earn 51 to 80 percent of AMI;and moderate income
households earn 81 to 120 percent of AMI.
1
differ for rental and homeowner developments. Some California jurisdictions require all
new residential development to comply with inclusionary requirements regardless of
size, while others have adopted minimum thresholds ranging from five to fifty units.
The majority of programs have a threshold of five to ten units. Those programs which
apply to all developments or have a low threshold typically permit payment of a fee in
lieu of construction of affordable units.
o Unit Requirement: policy decision concerning the percent of residential units which
must be affordable to the target population. Requirements may differ for rental and
homeowner developments, as well as for different size developments. In California,
requirements for the inclusion of affordable units in residential developments range from
5 percent to 35 percent of the total number of units developed, with the vast majority set
at 10 to 15 percent.
o Term of Affordability: policy decision concerning the minimum required term of
affordability and applicable resale restrictions. Requirements may differ for rental and
homeowner developments. Terms of required affordability are usually recorded as deed
restrictions on the property. In California, required terms of affordability range from
no requirement to perpetuity, with 30 years as the most common term. In addition, some
jurisdictions employ a rolling affordability requirement: each time a restricted unit is
sold, the term of required affordability begins anew.
During the required term, rental units must be affordable to and occupied by households
in the target population. If the income of a household occupying an affordable unit
increases above the maximum allowable, then the next available unit must be made
available to a qualified household at an affordable rent. Resale restrictions on
homeowner units often take the form of a right of first refusal. Under this type of
program, the jurisdiction has the right to acquire or assign the right to acquire 'the
affordable unit to another qualified household at a specified price. The resale price is
typically limited to the original acquisition price adjusted for inflation or appreciation in
real estate values. In the event that a qualified household cannot be identified and/or the
jurisdiction elects not to exercise its right of first refusal, the current owner may sell the
unit on the open market for the current market price.
o Design Considerations: policy decisions concerning the comparability of affordable
units to the market rate units in terms of design and location. Comparability
guidelines vary substantially among California jurisdictions with inclusionary programs.
Most programs permit the developer some flexibility with regard to the size, number of
bedrooms, and interior amenities provided in the affordable units. However, in order
to avoid stigmatizing certain units as "affordable", most programs also require that these
units be similar to market rate units in exterior appearance and that they be dispersed
throughout the development. Such requirements are consistent with the County's Density
Bonus Program.
o In Lieu Fee Option: policy decision concerning the payment of fees in lieu of
building affordable units. In lieu fees may be used to by the jurisdiction to support
affordable housing development in other locations and projects. High in lieu fee rates
will encourage the provision of the required number of affordable units in new residential
developments, while low rates will encourage the payment of fees in lieu of providing
the units. The majority of California jurisdictions with inclusionary programs permit the
payment of a fee in lieu of providing the required affordable units. The in lieu fees vary
2
from a low of $2,100 per unit in Coronado to a high of more than $16,600 per unit in
Davis. As of January 1992, no affordable units had been constructed in connection with
Coronado's inclusionary program, while the Davis program had produced an estimated
1,000 units.
o Additional Options: policy decisions concerning additional options to the provision
of the required units within the proposed residential development. In addition to in
lieu fees, allowable alternatives could include: off-site compliance (construction of all
or a portion of the required affordable units at alternative locations); dedication of
alternative sites for affordable housing development; use of affordable housing "credits"
earned on a prior project which included affordable units; and acquisition of affordable
housing credits from other developers. While these options increase the developer's
flexibility in meeting inclusionary requirements, they may-discourage efforts to achieve
a broader distribution of affordable housing opportunities in all areas of the County.
o Developer Incentives and Offsets: policy decisions concerning developer incentives
and offsets designed to reduce the financial burden of compliance with inclusionary
requirements for affordable units. Requirements to include a specified percentage of
affordable units in a residential development may impose a financial burden on the
developer. To the degree that the developer is able to pass this burden through to other
buyers, this will result in increased prices paid by households acquiring the market rate
units. In an effort to offset this burden and facilitate the provision of affordable units
without driving market rate prices higher, jurisdictions may elect to provide a
combination of developer incentives and offsets, including: a density bonus program;
fee waivers; relaxed design restrictions for affordable units; and fast tracking through the
plan approval and permit process. Each of these programs are designed to increase
developer revenues and/or reduce costs in order to offset the burden of providing the
affordable units. California jurisdictions currently employ all of the developer incentives
and offsets listed, with density bonus programs as the most common approach.
kh/k3b/HTFIOC6
3
C IT% OF SRN RRIION TEL : 415-866-1436 Nov 30 ,92 12 :08 NO -003 P .02
San Ramoll
At�I 1�.-A I
102 CAMINO RAMON
CITY OF SAN RAMON r.O.BOX 5 148
SAN RAMON,CAUrc);INIA W583
(S 10)275.2700
FAX:0101866-1436
November 30, 1992
Kathleen Hamm
Senior Housing Planner
Community Development Department
Administration Building
651 Pine Street RECEIVED
4th Floor - North Wing
Martinez, CA 94553 DEC 021992
Re: Contra Costa County Housing Trust Fund - Off Ice Of
Revenue Sources i nty AdministratoV
Dear Ms. Hamm'
On November 24, 1992, the San Ramon City Council considered the County's
proposal for a Housing Trust Fund, and made the following recommendations
regarding the three potential revenue sources presented by the Contra Costa County
Housing Trust Fund Task Force.
Countywide General Obligation Bond: It was the consensus that a G.O. Bond
presented the most viable option. The Council expressed support of a measure that
would allow County residents the opportunity to vote their opinion regarding revenues
for affordable housing. The Council also cautioned that current economic conditions
may hinder the passage of G.O. Bond, and suggested waiting until such time that the
regional economy Improves.
In-lieu Housing Fees. The Council is reluctant to support an inclusionary housing
program for a countywide Trust Fund, because the resulting in-lieu fees would likely
generate an insignificant amount of revenues.
Landfill Tipping Fees: The idea of raising tipping fees to construct affordable housing
would receive no support from the City Council, now or in the future.
CTYCOJINCII )1).P))Q AVMr-NISTRAIIVE 11AWFA,2,32J22 rot I(A:175.2170 ENC1NfFft,w, 1752260
C:jV M11NACt o 775 2330 PUK4 StRvtcul 27 •1 100 rARKS L COMmUNIty%'OvICES,276-22'XI ILANNINIj:173 WO
CITT"60k MANSKATA110" )1W7)0 COMMUNITY CEWtR 1157300 guioimc,wsrECTILIN.).? .Izlo
NOV-30-1992 13:08 415 866 1436 P.002
OF SAN RAMON TEL : 415-866-1436 Nov 30 ,92 12 :08 No .003 P .03
Kathleen Hamm
November 30, 1992
Page 2 of 2
On behalf of the San Ramon City COUnCil, I want to thank you for the opportunity to
review the proposals for a Housing Trust Fund, and hope that our comments are
useful in assisting the County in its future decisions regarding now revenue sources
for affordable housing,
Sincerely,
Patricia Boom
Mayor
PB;DR/c516.92
NOU-30-1992 13:09 415 866 1436 P.003