CITY COUNCIL STAFF REPORT
MEETING DATE: May 18, 2016
PREPARED BY: Gina Paolini, Senior Planner/Planning Department
APPROVED BY: City Manager
Title
RESIDENTIAL DEVELOPMENT CONTROL SYSTEM (RDCS) BIENNIAL REVIEW AND ADOPTION OF SET ASIDE ALLOTMENTS FOR THE 2016 RDCS COMPETITION
END
RECOMMENDATION(S)
RECOMMENDATION
Adopt Resolution approving the total building allotment for FY 2018/19 and 2019/20 and the housing type distribution for the 2016 RDCS competition.
BODY
COUNCIL PRIORITIES, GOALS & STRATEGIES:
Ongoing Priorities
Protecting the environment
Maintaining fiscal responsibility
2016 Focus Areas
Planning Our Community
Developing Our Community
REPORT NARRATIVE:
The number of allotments available for the Residential Development Control System (RDCS) is determined on a biennial basis, as required by Section 18.78.030 (Development Allotments) of the Morgan Hill Municipal Code. The determination of the number of allotments is intended to maintain a rate of growth that will not exceed a population of 48,000 by the year 2020.
In accordance with Section 18.78.184 (Procedures) of the Morgan Hill Municipal Code, no later than May of each year, the Planning Commission is required to provide a recommendation to the City Council regarding the total number and distribution of building allotments for a given RDCS evaluation year.
Planning Commission Review
The Planning Commission conducted the RDCS biennial review at their meeting of May 10, 2016, using population data made available by the Department of Finance (DOF) on May 1, 2016. According to the DOF, the City of Morgan Hill population as of January 1, 2016 was 43,645. Planning Staff presented a report (Attachment 2) that provided an adjusted population for the City based on the City's backlog of units, Measure A units and other estimated factors. The City of Morgan Hill adjusted population is 44,420.
The Planning Commission reviewed the rate of growth within the City, using the adjusted population and remaining years for RDCS. Planning staff recommended a maximum annual allotment of 250, citing the methodology outlined in Section 18.78.182 (Rate of growth) of the Morgan Hill Municipal Code, which specifies the method by which controlled growth will be accomplished (see attached Planning Commission staff report). The Planning Commission discussed the appropriate methodology for determining a rate of growth, and a majority of the Planning Commissioners concluded that the initiative language specified in Section 18.78.030 (Development allotments-Determination and distribution) of the Morgan Hill Municipal Code is the determining factor when determining growth and accordingly recommended that the annual allotment for Fiscal Years 2018/19 and 2019/20 be 282.
The Planning Commission also recommended a one year competition for 2016 in anticipation of the adoption of the RDCS update later this year. The City, as part of the Morgan Hill 2035 Project, is in the process of drafting a comprehensive update of the RDCS with the goal of placing the new RDCS on the November 2016 ballot for voter consideration. Should the new RDCS be approved by the voters, one more competition cycle would occur under the current RDCS in 2017 for FY 2019/20 allotments. The current RDCS will otherwise expire at the end of FY 2019/20.
Following review of the rate of growth, the Planning Commission discussed the building allotment set-asides and project assumptions. After receiving input from the development community, the Planning Commission recommended the following:
|
Table 2: RDCS Fiscal Year 2018/19 Building Allotment Set-asides |
|
Competition Category |
Proposed Allotment |
% of Allotment |
|
On-going |
40 |
14% |
|
Small |
5 |
2% |
|
Micro |
5 |
2% |
|
Multi-Family Rental (>150) |
95* |
34% |
|
Multi-Family Rental |
10 |
3% |
|
Open/Market |
65 |
23% |
|
Affordable |
57 |
20% |
|
Monterey Corridor |
5 |
2% |
|
|
|
|
|
Total Allotments |
282 |
100% |
* 85 Multi-Family Rental Allotments previously awarded to MC-15-18 (San Pedro-Presidio) for FY 2018/19.
Next Steps
Section 18.78.125.D (Award and Issuance of Allotments) of the Morgan Hill Municipal Code requires that allotments be issued no less than 16 months prior to the start of the fiscal year (March 1st) in which the allotments must be used. To accommodate this statutory deadline, the RDCS application filing deadline for the upcoming competition is scheduled for September 1, 2016.
A pre-competition meeting will be held with the development community in June to discuss the 2016 RDCS competition and available allotments.
COMMUNITY ENGAGEMENT: Inform
The Planning Commission discussed the biennial report at their meeting of May 10, 2016. The RDCS Stakeholders were notified of both the Planning Commission and City Council meetings.
ALTERNATIVE ACTIONS:
1. The City Council could reduce the maximum annual allotment to 250 or less as recommended by staff to the Planning Commission, citing the methodology outlined in Section 18.78.182 (Rate of growth) of the Morgan Hill Municipal Code, which specifies the method by which controlled growth will be accomplished.
2. The City Council could also authorize a two year competition or partial allocations into a second year.
PRIOR CITY COUNCIL AND COMMISSION ACTIONS:
The Planning Commission reviewed the biennial report at their May 10, 2016 meeting. A motion was made by Commissioner McKay and seconded by Commission Tanda to recommend 282 allotments for Fiscal Years 2018/19 and 2019/20 (5-2-0-0), with Commissioners Spring and Orosco voting no. The Commission had a lengthy discussion involving several motions to determine how to distribute the additional 32 allotments made available by determination to award 282 rather than 250 allotments in the upcoming RDCS competition as follows:
1. A motion was made by Commissioner McKay and seconded by Commissioner Toombs to provide an additional 7 allotments within the affordable category and 25 within the on-going category (3-4-0-0), the motion failed with Commissioners Spring, Orosco, Tanda and Downey voting no.
2. A motion was made by Commissioner Tanda and seconded by Commissioner McKay to provide 75 allotments within the open/market category, 25 within the on-going category and 57 within the affordable category (3-4-0-0), the motion failed with Commissioners Spring, Mueller, McKay and Toombs voting no.
3. A motion was made by Commissioner Downey and seconded by Commissioner Orosco to provide an additional 10 allotments within the multi-family category, 7 within the affordable category and 10 within the on-going category (3-4-0-0), the motion failed with Commissioners McKay, Toombs, Spring and Mueller voting no.
4. Although stating that he does not agree with the 282 allotment figure, Commissioner Spring made a motion, which was seconded by Commissioner McKay to provide an additional 7 allotments within the affordable category and 25 within the on-going category (4-3-0-0), the motion passed with Commissioners Orosco, Tanda and Downey voting no.
FISCAL AND RESOURCE IMPACT:
The adopted budget reflects revenues from and resources for carrying out the 2016 RDCS competition.
CEQA (California Environmental Quality Act):
Not a Project
Review and distribution of RDCS allotments is not a project subject to the California Environmental Quality Act (CEQA) as no physical changes in the environment will occur as a result of the proposed action.
LINKS/ATTACHMENTS:
1. Resolution
2. May 10, 2016 PC Staff Report