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HomeMy WebLinkAboutLetter Response to SCAG - RHNA - Oct 2021-Oct 2029 Planning CycleSTAFF REPORT CITY OF PALM DESERT COMMUNITY DEVELOPMENT DEPARTMENT MEETING DATE: August 22, 2019 PREPARED BY: Jessica Gonzales, Senior Management Anal st REQUEST: Consideration for approval of submission of refterresponse to Southern California Association of Governments on the three methodology options for the Regional Housing Needs Assessment October 2021 — October 2029 planning cycle. Recommendation By Minute Motion, that the City Council, 1) Direct staff to continue monitoring the Regional Housing Needs Assessment ("RHNA") October 2021 — October 2029 planning cycle methodology options proposed by Southern California Association of Governments ("SCAG"), with the intent to submit a letter of response by the deadline of September 3, 2019. Final form and content shall be reviewed and approved by the City Council's Affordable Housing Subcommittee ("AHS") prior to submission. Strategic Plan One of the priorities of the City of Palm Desert's ("City") Envision Palm Desert Strategic Plan, as part of Land, Use, Housing and Open Space, is to facilitate development of high quality housing for people of all income levels. This request will assist in meeting that objective. Background Analvsis On August 2, 2019, the SCAG released three proposed draft RHNA methodology options for public review and comment. The RHNA methodology is a formula for calculating the number of housing units each city must plan for during the upcoming October 2021 — October 2029 RHNA planning cycle (also referred to as the sixth cycle). California requires that every city and county adequately plan to meet current and projected housing needs, and through RHNA, determines what that need is every eight years. Later this month, the California Department of Housing and Community Development (HCD) is expected to announce the latest need assessment for the six - county region, at which point SCAG is required to develop a proposed plan for how to allocate those numbers to local jurisdictions. August 22, 2019 — STAFF REPORT Community Development — RHNA Methodology Page 2of3 SCAG is proposing to approve one of the following sixth cycle allocation plan. The three proposed different mechanisms to determine a jurisdiction's regional total. three methodology options for the RHNA methodology options offer draft RHNA allocation from the PROPOSED RHNA METHODOLOGY OPTIONS COMPARISON Option 1 Option 2 Option 3 Existing need separate from Yes No No projected need Higher total of lower Yes No No income categories Emphasis on HQTA On existing need only, On total allocation, No from regional total 20% 20% Accounts for recent Yes No No building activity Social equity 110% for existing need 0 150 /o for projected o 150 /o for total need 150 /o for total need adjustment need Local input as a Yes No Yes component Option 1 allows for a higher degree of variability than Option 2 since it relies on both pre- determined characteristics (such as High Quality Transit Area ("HQTA")) and on local input, which can vary by jurisdiction and does not necessarily rely on pre- determined characteristics. Proponents of Option 1 may argue that its distribution mechanism allows for local conditions as reported by jurisdictions while still accommodating a need for linkage to regional transportation and land use planning. Option 1 also assigns existing need to lower income categories, which can meet the existing need factor of cost- burden specifically for low income households. Option 2 does not differentiate between existing and projected need in its distribution mechanism and creates a stronger link to regional transportation and land use planning by applying proximity to transit as a factor to the total need distribution. While local input is not a component, some proponents of Option 2 may argue that because local input may not inherently consider regional goals might be a reason to exclude it as a main factor in RHNA methodology. Option 3 uses local input as the basis for determining a jurisdiction's share of regional growth. While Option 1 considers share of household growth as a factor for projected need, Option 3 considers population growth as a factor for total RHNA need. Except for household income distribution for social equity adjustment, this option does not use other factors beyond local input on growth, such as transit proximity, to determine a jurisdiction's housing need. * This summarized comparison was released by SCAG. August 22, 2019 — STAFF REPORT Community Development — RHNA Methodology Page 3of3 SCAG staff will conduct four public hearings to receive verbal and written comments on the three options to determine how best to allocate local housing needs as part of the RHNA process. All public comments must be received no later than Tuesday, September 3. Following the public comment period, SCAG staff will review all comments and recommend one distribution methodology as the "draft RHNA methodology" to the RHNA Subcommittee in late September at a special meeting, which is tentatively scheduled for September 23, 2019, and to the Regional Council in October. Given the complexities and quick turnaround required for submitting comments, staff's recommendation includes authorizing the City Council appointed Affordable Housing Subcommittee as the approving body for a comment letter. If approved staff will present its analysis to the AHS at its scheduled meeting of August 28, 2019 for final review and approval. LEGAL REVIEW NIA Robert H. Hargreaves City Attorney DEPT. REVIEW Ryan endell Director of Community Development j FIN NCI L CITY IRE MANAGER �-4 Ja Moore Lauri Aylaian Dir c r of Finance City Manager ATTACHMENTS: 1. Copy of SCAG PowerPoint presentation on 6th Cycle Proposed RHNA Methodology. 2. DRAFT 2019 RHNA Calculations (Options 1 through 3) 6th cycle Proposed RHNA Methodology Ma'Ayn Johnson, AlCP ComIHance and Performance Monitoring RHNA Milestones and outlook RHNA Subcommittee Charter Regional determination Proposed RHNA Methodology for public comment period Draft RHNA Methodology for HCD review Draft RHNA allocation RHNA appeals hearings Final RHNA allocation ATTACHMENT 1 October 2018 June 2019 July 2019 October 2019 February 2020 July 2020 August 2020 RHNA Subcommittee Meeting - July 22, 2019 Page 42 of 336 7/17/2019 Objectives of RHNA Objectiuoxv. of RHNA 3) Promoting an improved intraregional relationship between jobs and housing 4) Allocating a lower proportion of housing need in income categories in jurisdictions that have a disproportionately high share in comparison to the county distribution 5} Affirmatively furthering fair housing i RHNA Subcommittee Meeting - July 22. 2019 Page 43 of 336 7/17/2019 Proposed RHNA Methodology: Options • Three options developed based on feedback from RHNA Subcommittee and stakeholders • Each option applies different components • Recommendation to release for public comment period • One option will be recommended in late September 2019 for submittal to HC❑ Option 1 Step 1 Determining Existing Need Regional Existing Need Relative ah are of rer lonaI building Jurisdiction Existing Need M. , RHNA Subcommittee Meeting - July 22. 2019 Page 44 of 336 3 7/17/2019 option 1 Step 1: Determining Existing Need Jurisdiction Existing Housing Need [only three categories] Very low 1'% social equity© Law adjustment Moderate -----------------I ---------------- Option 1 Step 2: Determining Projected Housing Need Jura Ictlon's share of re Iona! a (owner) shareor M Projected Housing proierted HH Growth reHionaV Future replacernent Need RHNA Subcommittee Meeting - July 22. 2019 Page 45 of 336 4 7/17/2019 Option 1 Step 2: Determining Projected Housing Need Option 1 Step 3: Total RHNA Allocation Jurisdiction Existing Need Very low Low MDdf rate i •r l— — — — — — Jurisdiction Projected Need Low Moderate AtN]ae moderate Jurisdiction Projected rloJsAg Need A6o�e moderate Jurisdiction Total RHNA Allocation � 7 Law Moderate Above moderate RHNA Subcommittee Meeting - July 22, 2019 Page 46 of 336 5 7/17/2019 Option 2 Option 2 Step 2 Jurisdiction Total Housing Need -share of + regional 150% social equity reJtional Jurisdiction Total Housing Need Low RHNA Subcommittee Meeting - July 22. 2019 Page 47 of 336 7/17/2019 Option 3 Step 1 ruture ishare of repionaV w� Future reoa[emen[ • Similar to projected need from option 1 Share of regional population growth instead of household growth • Horizon year based on closest household growth to regional determination from HC❑ [option 3 Step 2 Jurisdiction Projected H 1 ...I RHNA Subcommittee Meeting - July 22. 2019 Page 48 of 336 7 • City A • Urbanized • Within County X • Most of population is within an HQTA • Population: Appx. 65,000 • Higher concentration of lower income households than other parts of the county • City B • Suburban community • Within County Y • No HQTAs within jurisdiction • Population: Appx 65,000 • Higher concentration of high income households than other parts of the county 7/17/2019 Option is Step 1 Existing Need • Example assumption: Regional existing need of 250,000 • 175,000 (70%) will be assigned based on population share • 50,000 (20%) will be assigned based on population share within HQTA • 25,000 (i o%) will be assiggned based on share of recent regional permit activity in cuiiipai ,on to population +Share of regional population 6o6 +Share of regional population God (035%) (0.35%) +'Share of regional population 183 within HQTA (0.37%) +Share of permit activity in comparison to population (t., o%) =Total existing need +Share of regional population o within HQTA (o%) 280 +Share of permit activity in comparison to population (0.30%) i,o6g =Total existing need Social Equity Adjustment i 88 694 RHNA Subcommittee Meeting - July 22, 2019 Page 50 of 336 9 7/17/2019 �A Option 1: Step 1 Existing Need Income Category ®®�Above Current Distribution 30.-1 t0 23.29l6 1].6`to 29.1% t00% After Ito% adjustment 24.8% 14.8°l0 16.7% 43.6% t00% After 1io% aajustrrtent 440% 26.3% 29.7% -- t00% into 3 categories Current Distribution 15.8% 12.29l0 16.8% 55.2% t00% After tio% adjustment 24.5% 16.9% 18.5% 40.10lo t00% After t to% adjustment 40.9% 28.3% 30.8% -- 100% into 3 categories Option 1: Step 1 Existing Need Very low Low Moderate Above moderate Total 459 296 315 t,o6g 318 178 198 694 RHNA Subcommittee Meeting - July 22. 2019 Page 51 of 336 10 7/17/2019 Option 1: Step 2 Projected Need • Projected need will be determined by three factors: Option 1: Step 2a 'Household Growth • A jurisdiction's share ❑f regional household growth using local input as the basis City A +Household growth (based on 498 local input) +Household growth (based ❑n 1,324 local input) RHNA Subcommittee Meeting - July 22, 2019 Page 52 of 336 7/17/2019 Option 1: Step 2b Future Vacancy Need • Future vacancy need uses the breakdown of owner and renter households in each jurisdiction • A 1.5% vacancy rate is applied to projected owner households • A 5.o°Io vacancy rate is applied to projected renter households Existing owner and renter Existing owner and renter 57-6% Renter -Occupied 6�i%Owner-Occupied 33SX Re-ter-�cci•a ed 042-4%6,Dwner-Occupied of total units = Y87 of total units =g$a of total units = 4a4 o` total uni!=_s X 1.5%-3 un s 287 units X � C. = 15 units 880 units X 1 5 ; =13 units 494 units X5.0%= 22 units 3 units + 15 units = 18 units Option 1: Step ?r- Replacement Need 13 units + 22 units = 35 units • Jurisdictions will be assigned a replacement need based on their share of regional replacement need • Share of regional replacement need was adjusted by replacement need survey results • The final regional replacement need will be assigned after the regional determination process with HCD • Some jurisdictions replaced all demolished units and have o replacement need. +Replacement need (based on 24 adjustment from survey) +Replacement need (based o on adjustment from survey) RHNA 5ubcommlttee Meeting - July 22. 2019 Page 53 of 336 12 7/17/2019 Option 1: Step 2 Projected Need M'W'+Projected household growth 498 +Projected household growth 1,324 +Future Vacancy Need 18 +Future Vacancy Need 35 +Replacement Need 24 +Replacement Need 0 =Projected housing need 540 =Projected housing need 1359 Option 1: Step 2 mt Very low Low Moderate Above moderate City B 30.1% 25.3% 12.90/c 23.2% 15.6% ] 1.8% 17.6% 16.8% 16.4% 29.1% 42.39l0 48.9% ery low 15.8% 23.7% 27.7% ow 12.2% 16.5% t8.6%a oderate 16.8% 18.3% 19.1% bore moderate 55.2% 41.5% 34.6% �r R H N A Subcommittee Meeting - July 22. 2019 Page 54 of 336 7/17/2019 Option 1: Step 3 Total RHNA Allocation Existing necu 459 296 315 -- i,o6g Projected need 130 60 83 266 S40 Total RHNA 589 356 398 266 i,608 ®® Above Existing need 318 178 198 -- 694 Projected need 396 245 242 477 1,359 Total RHNA 713 423 440 477 2,053 Optio"+ 11 • Example assumption: Regional need of 675,000 • 540,000 (8o%) will be assigned based on population share 135,000 • (20%) will be assigned based on population share within HQTA +Share of iegiuiiai pupwatibir 1,870 +Share of regional population 1,870 (0.35%) (0.35%) +Share of regional population 493 +Share of regional population o within HQTA (0,37%) within HQTA (0%) =Total need 2,363 =Total existing need 1,870 • Social equity adjustment: 15o% RHNA Subcommittee Meeting - ,duly 22. 2019 Page 55 of 336 14 7/17/2019 Optioi. • Based on population growth for selected horizon year Horizon year is selected based on horizon growth closest to HCD determination • Example assumption: HCD provides a total of 800,000 13m, GZMM= +�ndre or iegiotial 910 +Share of regional 4,950 population growth (0.14%) population growth (0.760l0) +Future vacancy need 32 +Future vacancy need 132 +Share of replacement need 24 +Share of replacement need o Total existing need 966 -Total existing need 5,082 • tal equity adjustment: i5o% A Comparison of Options Yes No No Yes No On existing need only, 20% on total allocation, 2o% Yes No No No No iio% for existing need o0 0 150% for projected need 150% for total need 150 to for total need Yes No Yes RHNA Subcommittee Meeting - July 22, 2019 Page 56 of 336 15 7/17/2019 Full Proposed RHNA Methodology • Step by step guide t❑ calculate a draft RHNA allocation in proposed methodology packet Full survey responses available at www.scag.ca.gov/rhna Next Steps • Recommendation ❑f RHNA methodology options for public review • Today, July 22 RHNA Subcommittee • August 1, CEHD and Regional Council • PrUposOd RHNA methodology public hearings • Tentative: August 20, 1❑-12PM, 1-3pm Los Angeles • Tentative: August 27, 5-7pm, Inland Empire • Tentative: September 3, 5-7pm, Los Angeles RHNA Subcommittee Meeting - July 22. 2019 Page 57 of 336 16 $ { { ¢ t ■ § { k { { d 2 \ \ \ § } E 7 \ i ) � ) \ 2 0 } } _ | � \\\}