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APPROVE AN AMENDMENT TO TITLE 16 OF THE STOCKTON MUNICIPAL CODE RELATED TO ACCESSORY DWELLING UNITS IN COMPLIANCE WITH STATE PLANNING AND ZONING LAW
recommended action
RECOMMENDATION
It is recommended that the City Council accept the Planning Commission’s recommendation and adopt an Ordinance to amend Title 16 of the Stockton Municipal Code, Section 16.80.310, “Secondary Dwelling Units;” and Section 16.240.020, “Definitions of Specialized Terms and Phrases;” to comply with state planning and zoning law (Government Code Section 65852.2).
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Summary
On September 27, 2016, the state approved new regulations pertaining to accessory dwelling units (Government Code § 65852.2), which became effective on January 1, 2017. The intent of the new regulations was to facilitate and expedite the construction of new dwelling units that are secondary to a single-family residence on the same lot to increase affordable housing in California. Cities are encouraged to amend local zoning ordinances to provide a means of facilitating accessory dwelling units (ADUs) under local development standards. If a city does not elect to amend its ordinance by the effective date, state law applies, and the City's ordinance is null and void. Today, the Stockton Municipal Code section pertaining to “secondary dwelling units” (SDU) is inoperable. While state law is operable today, the proposed ADU ordinance is necessary to provide for local zoning application, review process and development standards that are appropriate for Stockton and to establish an appropriate local fee structure.
The proposed code amendment provides: less restrictive development requirements for ADU consistent with state law, a streamlined local review process, and local design standards meant to facilitate ADUs. The proposed ordinance will benefit Stockton by increasing housing options. Key proposed changes include the following:
• name and definition change for “accessory dwelling unit”
• easing of setback requirements
• elimination of parking requirement
• simplification of review process
Under the proposed ordinance, ADUs would not be subject to PFF and utility connection fees would not be charged unless the applicant requested a separate connection. State law requires the assessment of utility and public facilities fees (PFF) on ADUs to be proportional to the actual burden given the size and limited occupants. The existing SDU ordinance, requires the payment of both PFF and connection fees, which arguably is disproportionate. At a minimum, the historical SDU fee structure could discourage the development of ADUs as an additional form affordable housing. The proposed ordinance would allow ADU fee calculations to be completed in a manner similar to additions to existing single-family residences. Today, the addition of floor area square footage for a house remodel or house addition does not trigger PFF collection or utility connection fees. Because an ADU is secondary to a single-family residence on the same lot it is appropriate to assess fees similar to a single-family residence remodel or house addition. Staff anticipates this will encourage the construction of ADUs and provide more opportunities for affordable housing.
DISCUSSION
Background
Secondary dwelling units (SDUs) were established following the passage of state legislation (Mello Act, SB1534) in 1982. The allowance for SDUs was intended to promote the development of second residential units as a source of affordable housing. State regulation provided the means for local governments to adopt an ordinance to legally permit second dwelling units. While the Stockton Municipal Code complied with state legislative requirements, recent amendments to state law meant to ease local agency permitting requirements compel a local ordinance change. A local ordinance change is necessary to provide for application of local zoning and development standards that are appropriate for Stockton and to establish an appropriate local fee structure. The proposed changes conform with state law, allow for application of local zoning and development standards, streamline the review process and enable an appropriate fee structure for ADUs.
At the urging of affordable housing advocates, the state legislature adopted two separate bills in 2016 to make it easier to develop ADUs. Housing advocates argued that some local agencies throughout California imposed costly barriers on second dwelling unit requests. On September 27, 2016, the Governor signed Senate Bill (SB) 1069 and Assembly Bill (AB) 2299 modifying Government Code section 65852.2. Both laws took effect on January 1, 2017. Under this legislation, any city ordinance that was not compliant by January 1, 2017, is considered null and void until a new local ordinance is adopted. When a local ordinance is nullified, the local agency operates under the state standards, as is the current situation in Stockton. Operating under the state standards does not allow for the application of local zoning, review process and development standards or provide an appropriate fee structure.
Since passage of the new state laws, staff conducted extensive research on the new requirements and other local jurisdiction’s ordinances for review/permitting process, development standards, fire sprinkler requirements, and fees. This research influenced the drafting of the proposed ADU ordinance for Stockton. The draft ordinance that in certain instances is less restrictive than state requirements and should lead to the development of more affordable housing in Stockton.
The City’s current Title 16 ordinance (development code) defines secondary dwelling units (comparable to ADUs) as follows: “a permanent dwelling that is accessory to a primary dwelling on the same site. These units generally provide complete, independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking, sanitation, and parking.” Code section 16.80.310 specifies development standards and a review process for approving secondary dwelling units (See Attachment A - Existing Code).
Present Situation
To comply with the new state law, staff drafted a proposed ordinance and presented it to the Planning Commission for input and recommendation. In addition to achieving compliance with state law, the following key changes include less restrictive requirements for building setback, parking and the review process to encourage the development of ADUs (See Attachment B - Ordinance - Redline Version):
1. Name and Definition Change: Accessory Dwelling Units (ADUs) is proposed to replace Secondary Dwelling Units, along with a revised definition to better align with the state regulation.
2. Maximum floor area for ADUs: ADUs are identified as three types:
a. contained within an existing residence or existing accessory structure,
b. attached to an existing residence or existing accessory structure,
c. detached and on the same lot (see Attachment C - ADU types diagram).
The amendment proposes:
• No maximum floor area if contained within an existing structure.
• A maximum floor area of 50 percent of the existing living area for an attached ADU consistent with state law.
• No change to the 1,200 square foot maximum floor area for a detached ADU which is defined in state law.
3. Setbacks for ADUs: State law mandates that building setbacks be eased for ADUs. The proposed amendment reduces the 10-foot rear yard setback to a 5-foot minimum. No setback is required for an accessory structure (garage or storage shed) that is converted to an ADU.
4. Parking: State law mandates that parking requirements be eased and more flexible for ADUs. The City’s current parking requirements put limits on constructing ADUs, and the proposed ordinance exceeds the minimum state requirements by eliminating parking requirements for ADUs. Minimum parking requirements and requirements to replace covered parking when existing garages are converted to an ADU will be eliminated. Elimination of parking requirements could result in parking over the paved driveway or increased on-street parking.
5. New Standards for the placement of balconies, decks, and windows: New standards are proposed to limit the height of a balcony, deck, and windows on an ADU, which are not required by state law, but will help to ensure the privacy of residences surrounding an ADU.
6. Standards for review of ADU: The proposed amendment streamlines ADU applications, which can be submitted directly for building permit, except in certain circumstances where the ADU is proposed in the Magnolia Historic District, Channel area overlay district, or a Design Review District. In these cases, a ministerial Design Review under the Director’s authority will be needed.
State law also addressed other ADU “barriers” that fall outside of the City zoning ordinance. The following is a summary of the barrier issues.
Fire Sprinklers: The City currently follows the 2016 California Building Code, which requires an automatic fire sprinkler system in one and two-family dwellings. Recent state law added an exception to the automatic fire sprinkler system requirements for ADUs if all the following conditions exist:
• The unit meets the definition of an ADU in the Government Code section 65852.2.
• The existing primary residence is not required to have an automatic residential sprinkler system.
• The accessory ADU does not exceed 1,200 square feet in size.
• The unit is on the same lot as the primary residence.
The state Fire Marshal issued a bulletin to provide clarification for local authority implementation which includes a prohibition against requiring automatic residential fire sprinkler systems for ADU’s unless they are required for the primary dwelling unit (see Attachment D - State Bulletin 17-001). There are no changes required to Chapter 15.12 Fire Code of the City’s Municipal Code.
Utility Connections and Fees: The city historically charged separate sanitary sewer and water connection fees for any new SDU, as if it were a new single-family residence rather than an addition. State law prohibits local agencies from requiring a new or separate utility connection or charging utility connection fees for an ADU that is contained within an existing residence or existing accessory structure. For all other ADU types, the law allows local agencies to require separate utility connections and charge utility connection fees at a fee rate that is proportionate to the burden of the proposed ADU.
Municipal Utilities Department (MUD) staff considered the possibilities of charging a proportionate rate scale for an ADU and determined that separate utility connections should not be required for an ADU. Today, connection fees for residential use are charged per single family lot on a flat rate, and not based on square footage of the residence, for both water and sewer. It is recommended that ADU’s be assessed fees similar to an addition to a single-family residence and when the ADU is connected to the existing on-site plumbing for the main dwelling unit. Any additional water use associated with the ADU would be assessed based on the existing water meter. Sanitary Sewer is charged at a flat rate for a single-family unit. Since an ADU is not expected to have more than four fixtures (2 sinks, 1 toilet, 1 shower/bath), staff recommends treating ADU applicants as additions to single-family residences and not requiring separate utility connections and associated fees to be paid. If the property owner desires to have a separate water meter and sewer, then an appropriate connection fee would be charged.
Public Facilities Fees (PFF): The City historically interpreted SDUs as stand-alone single-family residences and charged the same fee rate as a single-family residential unit. State law recommends that fees be charged proportionately to the ADU burden. The current SDU fee structure, which assesses PFF, is arguably disproportionate and a new approach to fees for ADUs is recommended. PFF fees for residential uses are assessed based on a dwelling unit rate, such as a Single-Family Dwelling Unit and not by square footage. Any subsequent residential additions of square footage are not subject to PFF collection. The proposed ADU ordinance assesses fees in the same manner as additions to the main single-family residence and would not require additional PFF collection. An increase in the number of ADU permits issued may be seen because treating ADU applicants as additions to single-family residences versus a separate single-family residence will lower the cost.
Planning Commission Public Hearing
On March 8, 2018, a public hearing was held before the Planning Commission. The public hearing was noticed with a legal ad in the Record as per the SMC 16.88 requirements. There were no public comments received in writing. One person spoke in support during public testimony at the hearing. The Commissioners asked questions regarding the proposed amendment and approved a resolution recommending approval by the City Council. (see Attachment E - Planning Commission Resolution.)
Environmental Review
The proposed SMC amendments are exempt from the California Environmental Quality Act (CEQA) under the “general rule” that CEQA applies only to projects that have the potential for causing significant environmental effects, as specified in section 15061(b)(3). Approval of the required amendments constitutes an administrative action that will not result in direct or indirect physical changes in the environment, and any future projects that would rely on these amendments will require further case-specific environmental review under CEQA.
FINANCIAL SUMMARY
The City historically interpreted the construction of second dwelling units as single-family residences and charged PFF for a new second dwelling unit at the same fee rate as a single-family residence. The change in state law and policy recommends that fees be charged proportionately to the ADU burden.
Therefore, to provide affordable housing where adequate public facilities and services are available and impacts upon residential communities directly affected would be minimal, ADUs would be handled similar to a single-family home addition and PFF collection would not be triggered with the addition of floor area square footage. Sanitary sewer and water connections would continue to be handled on a per lot basis, and connections fees only charged if a second meter were installed. For ADU’s where water and sewer service is provided by extending the plumbing from the existing dwelling, no connection fee would be charged.
Staff researched different cities and found that comparable cities such as Oakland, Modesto, Fremont, and Sacramento do not assess PFFs. Other cities assess by additional square footage or the use type (such as guest room rate and multi-family rate). This variation in the assessment of PFF’s reflects the newness of the law and the individual jurisdictions. In 2016, the City of Stockton adopted a Housing Element with policies that support additional affordable housing options. Consistent with these policies, staff recommends charging ADU fees consistent with the existing practice for single-family home additions.
Attachment A - Existing Code
Attachment B - Redline Strikeout Version
Attachment C - ADU Types Diagram
Attachment D - State Bulletin 17-001
Attachment E - Planning Commission Resolution No. 2018-03-08-0501