title
CC - Adoption of a Resolution Approving Density and Other Bonus Incentives, DOBI P-2014187, for a Proposed Three-Story, Apartment Building Consisting of 36 Multi-Family Units which Will Include Three Very Low Income Affordable Units above an 85 Space Subterranean Parking Level at 4025 Grand View Boulevard.
body
Contact Person/Dept: Jose Mendivil, CDD
Phone Number: (310) 253-5757
Fiscal Impact: Yes [] No [X] General Fund: Yes [] No []
Public Hearing: [X] Action Item: [] Attachments: Yes [X] No []
Commission Action Required: Yes [X] No [] Date: 01/27/16
Commission Name: Planning Commission
Public Notification: (E-Mail) Meetings and Agendas - City Council (03/25/16); Mailed to all the property owners and occupants within a 500 foot radius extended to the end of the block; Sign Posted on the subject property on March 7, 2016. Emailed to the City’s Master Notification List and Posted on the City’s website on March 10, 2016
Department Approval: Sol Blumenfeld, Director of Community Development (03/17/16)
______________________________________________________________________
RECOMMENDATION:
Staff recommends that the City Council adopt a resolution approving Density and Other Bonus Incentives, DOBI P-2014187, subject to the Conditions of Approval contained in the proposed resolution (Attachment No. 1) in order to allow construction of three affordable dwelling units at the property located at 4025 Grand View Boulevard.
PROCEDURE:
1. The Mayor seeks motion to receive and file the affidavit of mailing and posting of public notice.
2. The Mayor calls on staff for a brief staff report and City Council poses questions to staff as desired.
3. The Mayor seeks a motion to declare the public hearing open, providing the applicant the first opportunity to speak, followed by the general public.
4. The Mayor seeks a motion to close the public hearing after all testimony has been presented.
5. The City Council discusses the matter and arrives at its decision.
BACKGROUND:
On December 9, 2014, an application was submitted to the Planning Division by Grandview Development, L.P. (Applicant/Owner) for a Site Plan Review, Administrative Use Permit, and Density and Other Bonus Incentives to allow the construction of a 3-story, 37-foot tall, 36-unit townhouse style apartment building with 85 subterranean parking spaces. The project includes three very low income affordable dwelling units.
The project requires approval of a:
• Site Plan Review (SPR) to build residential units exceeding nine units;
• Administrative Use Permit (AUP) to stripe 27 pairs of tandem parking spaces; and
• Density and Other Bonus Incentives (DOBI) to allow an increase of 35% from the base of 26 units allowed to 36 units in return for three covenanted very low income units among the 36 units proposed to be constructed as per State Density Bonus Law.
On January 27, 2016, the Planning Commission, after considering the staff report, the application materials, applicant presentation, and providing for an opportunity for public comment, adopted Resolution No. 2016-P001 (Attachment No. 2) approving Site Plan Review, SPR P-2014186 and Administrative Use Permit, AUP P-2014185 and recommending the City Council approve Density Bonuses and Other Bonus Incentives, DOBI P-2014187. No appeals were filed on the SPR and AUP resulting in the Planning Commission decisions on those items becoming final. Tonight, the City Council is requested to act only on the DOBI. Please see Attachment Nos. 3 through 6 (Planning Commission Staff Report, Preliminary Development Plans, Financial Analysis, Planning Commission Minutes) for a detailed review of the Project. It should be noted that all three affordable units are identical to the rest of the units in architecture, number of bedrooms, terraces, and amenities. The three affordable units will not be distinguishable from the other 33 units.
ANALYSIS:
Culver City Municipal Code (CCMC) Chapter 17.580 - Density Bonuses and Other Bonus Incentives implements the requirements of the State Density Bonus Law (Government Code Sections 65915 through 65918 - Density Bonuses and Other Incentives - collectively, “Density Bonus Law”). Therefore, under a DOBI application, a developer can increase the base density for a housing development provided the development reserves for 55 years a certain percentage of the units for moderate to low income households. In addition, a developer can ask for concessions, or relief from development standards such as height, setbacks, and parking, if such standards prevent the ability to provide the affordable units within the development. The City cannot deny a concessions request as part of the DOBI if it is clear that such concessions are needed to provide for the project’s affordable housing costs. The number of concessions and the density increase that can be granted are based on a sliding scale of percentage of units devoted to affordability and the percentage density increase. All calculations in a DOBI application are rounded up to the next whole number.
It is important to note that the density increase and the concessions are provided per the Density Bonus Law as an incentive for developers to provide affordable housing. With the dissolution of redevelopment agencies, several mechanisms that cities once had, including direct funding for construction of affordable housing, have been eliminated. The Density Bonus Law is one method by which market housing developers can provide affordable housing within an otherwise market rate development, even if such housing is only a small percentage of the development in question.
The project’s base density per the Zoning Code is 29 dwelling units per acre or one unit per 1,500 square feet of lot area; the project site is 39,000 square feet. This equates to 39,000 square feet X (1 Unit/1,500 square feet) = 26 units. Based on the Density Bonus Law, an applicant must be granted a 35% density increase if they reserve at least 11% of the total base density units for very low income households. The income categories for affordable housing include extremely low income, very low income, low income, and moderate income. Housing sold or rented at the market rate is considered above moderate. Every year the State of California’s Department of Housing and Community Development (HCD) establishes for every California county the income level criteria for extremely low income, very low income, low income, and moderate income levels.
The project applicant is requesting a density increase of 35% (35% X 26 = 9.1). The Density Bonus Law requires that fractional remainders in density calculations be rounded up resulting in a density increase of 10 units. At least 11% of the 26 units must be made affordable to very low income households or individuals. This equates to 11% X 26 = 2.86 or three units. The project will result in 36 units with three of those 36 units covenanted for 55 years for very low income individuals or households.
The Density Bonus Law also requires cities to grant up to two concessions or relief from the development standards (such as setbacks, height, and parking) if at least 10% of the base density units are reserved for very low income households. Generally, a city can deny concessions only if findings can be made that such concessions are not needed in order for a proposed development to provide affordable housing units. The applicant is providing 11.5% very low income units and has asked for the following height and setback concessions pursuant to the Density Bonus Law:
• Height: The Zoning Code allows building heights up to a maximum of two stories and 30 feet in the RMD zone. The applicant is requesting a height concession to increase the building height to three stories and 37 feet. The height is measured from the street grade to the top of the roof deck and does not include the added height from the parapet wall which the code allows; maximum height does not include the height of the parapet wall.
• Setbacks: The RMD zone requires a five-foot setback from the sides, 10 feet or one half the building height whichever is greater from the front, and 10 feet from the rear. The project is consistent with all code required setbacks except the south facing side property line which is setback 4 feet, 6 inches. The applicant is requesting a setback concession to reduce the side setback from 5 feet to 4 feet, 6 inches.
The Applicant provided a financial analysis prepared by The Sotelo Group, Inc. (Attachment No. 5) to demonstrate that the height and setback concessions are needed. The analysis is based upon the project development pro forma. The analysis concludes that the reduction in units/bedrooms creates a reduction in income to the project relative to the costs of construction and the costs to leverage the affordable units. The report finds that without concessions, the project is unable to support more units above the base 26, and it will fail to yield a higher gross rental income which in turn will limit its ability to support a larger private loan. A drop in project income translates into a reduction of private conventional financing by 25%; nearly a $1.2 million decrease which impacts the project's feasibility. The Study concludes that the concessions requested are necessary to make the project financially feasible.
Both staff and Kaiser Marston Associates (KMA) reviewed the report. KMA concluded that the report did not fully demonstrate that the concessions are needed to ensure production of affordable units. However both staff and KMA agree that the project’s design including three affordable units out of 36 total units cannot be physically situated on the project site without the concessions. In this case, the existing height and setback requirements would limit the ability to provide three very low income affordable units within a 36 unit total development. Staff and KMA conclude that the requested concessions are justified based upon the physical characteristics of the project site. Based upon such physical characteristics, without the concessions, the proposed development could not accommodate the affordable units. Therefore, consistent with the Density Bonus Law, staff and the Planning Commission recommend the City Council adopt the proposed resolution containing the findings required under the CCMC and approving this DOBI request.
ENVIRONMENTAL REVIEW:
Pursuant to the California Environmental Quality Act (CEQA) guidelines, a Categorical Exemption Class 32 - In-Fill Development was adopted by the Planning Commission on January 27, 2016, which determined that the project will not have a significant adverse impact on the environment. Density and Other Bonus Incentives, DOBI P-2014187 is within the scope of the adopted Categorical Exemption (CE) and the circumstances under which the CE was prepared have not significantly changed and no new significant information has been found that would impact the CE, and therefore no new environmental analysis is required.
CONCLUSION:
Staff has worked closely with the applicant to assure compliance with the Density Bonus Law. By allowing the applicant to build 36 units through approval of the DOBI, the City will be leveraging the private funding resources committed to the project to enable the City to comply with its obligation under State Law to create affordable housing. Based on the proposed building design and construction of 3 affordable housing units, the granting of the requested concessions will not be detrimental to the public welfare or injurious to the property or improvements adjacent to or in the vicinity of the subject property and staff recommends approval of the DOBI request subject to the recommended Conditions of Approval contained in the proposed resolution.
FISCAL IMPACT:
There is no fiscal impact associated with the adoption of the proposed resolution.
ATTACHMENTS:
1) Proposed Resolution
2) Planning Commission Resolution No. 2016-P001 with Exhibit A - Conditions of Approval
3) January 27, 2016 Planning Commission Staff Report (without attachments)
4) Preliminary Development Plans Dated January 20, 2016
5) Financial Analysis
6) January 27, 2016 Planning Commission Minutes
RECOMMENDED MOTION(S):
That the City Council:
Adopt a resolution approving Density and Other Bonus Incentives DOBI P-2014187 subject to the Conditions of Approval as stated in the proposed resolution in order to allow construction of three affordable dwelling units.