HomeMy WebLinkAboutAgenda Statement 1987/08/25 Item 18COUNCIL AGENDA STATEMENT
• Item 18
Meeting Date 8/25/87
ITEM TITLE: Density Bonus request for a proposed eight-unit apartment
complex at 251 Oxford Street
Resolution ~~~ ~ Approving a density bonus of one unit
for a total of eight units at 251 Oxford and approving a
Housing Cooperation Agreement with Hector and Maria Zuniga,
property owners
SUBMITTED BY: Community Development Di recto
REVIEWED BY: City Manager ( the Vote: Yes No X )
Mr. Hector Zuniga, developer of a proposed apartment project at 251 Oxford
Street, has requested a density bonus of one unit under State Government Code
Section 65915. Under this law, a local entity is required to either approve a
density bonus or grant the developer other incentives of equivalent economic
value.
RECOMMENDATION: That the City Council approve a density bonus of one unit
for the proposed apartment project at 251 Oxford, and approve the Housing
• Cooperation Agreement with the developer outlining the terms and conditions of
the density bonus.
BOARDS/COMMISSIONS RECOMMENDATION: The Design Review Committee approved the
project design with the additional density bonus unit at their March 19, 1987
meeting, subject to City Council approval of the density bonus. The
Montgomery Planning Committee, on August 5, reviewed the project as an
informational item and did not express any objections. At their August 12
meeting, the Planning Commission recommended that the City Council approve the
proposed density bonus.
DISCUSSION:
Mr. Hector Zuniga is proposing to develop an eight-unit apartment project for
families at 251 Oxford Street. Current zoning allows seven units, and the
developer requests an additional unit under the State's Density Bonus
Program. This additional unit will consist of a two-bedroom single-family
house that is currently on the site. He intends to move the house to the rear
of the lot and construct seven apartments toward the front of the lot.
Section 65915 of the California Government Code provides that a developer of
multi-family rental housing can request a density bonus over the underlying
zone. In exchange for the density bonus, a developer must provide a
percentage of the total units as affordable housing for low and moderate
income households.
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• Page 2, Item 18
Meeting Date-57~37ST
In 1985, the City enacted Ordinance 12135 which provides a procedure for the
City to respond to requests by developers for density bonuses under the
provisions of California Government Code Section 65915. Under our policy, a
developer must provide 20% of the total project units prior to the granting of
a density bonus as affordable to low income households (households at or below
8U% of the area median income), and 5% of the pre-density project units as
affordable to moderate income households (households at or below 120% and
above 80% of the area median income). Rents on affordable units are
restricted for 25 years. Affordability is defined as rent levels not
exceeding 25% of the monthly income of households in those low and moderate
income categories. As an alternative to granting the density bonus, the City
has the option to grant to the developer other incentives of equivalent
economic value. A copy of the City's ordinance is attached for your review.
If the City Council grants the requested density bonus, the developer has
agreed to rent one, 2 bedroom apartment for no more than $523 a month to a
low-income household, and one, 2 bedroom apartment for a maximum of $785 a
month to a moderate-income household. While the developer has not yet
determined what his rent schedule will be, our ordinance sets maximum rents
that can be charged for restricted units. In reality, the market rate rents
will likely be below the maximum of $785 set for the moderate-income unit.
The moderate-income restriction would be beneficial if market conditions
change in the future and rents escalate. Currently, a family of four would
have to have an income of $25,100 a year or less to be eligible to rent the
unit reserved fora low-income household, and $37,700 a year or less to qualify
for the moderate-income restricted unit. Rents could increase as the median
income figures for the County increase. The units would be restricted for a
period of 25 years. The other units can be rented at market rates. Maximum
restricted rents are calculated using the affordable rent formula described in
our family density bonus policy. According to this formula, monthly rental
rates cannot exceed 25% of the gross monthly income of a four person household
whose income falls at 80% and at 120% of the County median income.
Land Use Considerations
The Planning Department has reviewed the project, and the Design Review
Committee has approved the eight-unit apartment project conditioned upon
Council approval of the 1 unit density bonus. The project will consist of
seven apartment units and one single family home that is currently on the
site. The house would be remodeled to match the architectural style of the
apartments to be constructed. The zoning in effect over the site is an RV-15
with a "K" building type, which allows up to 14.5 dwellings per net acre. The
addition of one unit over the seven units permitted under this zoning
represents a density bonus increase of 14%. No further review is required in
terms of land use considerations.
Conclusion
The issue before the City Council is to decide whether or not to grant a
• density bonus of one unit to the developer of 251 Oxford, or to agree to offer
equivalent financial incentives. According to State law, a local jurisdiction
Page 3, Item 18
• Meeting Date 8/25/87
does not have the option to deny a density bonus request without offering
equivalent financial incentives. All land issues have previously been
approved, and do not require City Council action. If the Council votes to
approve the density bonus, the City will gain two affordable housing
units--one for a low-income household and one for a moderate-income
household--with a 25 year restriction. Attached is a Housing Cooperation
Agreement between the City and the developer outlining the terms and
conditions of the density bonus. It is recommended that the Council approve
this agreement if they approve the density bonus.
If Council votes to offer equivalent financial incentives, it is recommended
that they refer the issue to staff to consider various alternatives which
would be brought back to the Council for their approval. Financial
equivalency would have to be determined, and such options as cash payment to
the developer, waiver of associated fees, or provision by the City of public
improvements could then be considered.
FISCAL IMPACT: Not Applicable
WPC 3079H
the City Council of
Chula Vista, Califon is
Dated
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