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DENSITY BONUS AGREEMENT FOR A MULTI-FAMILY AFFORDABLE HOUSING PROJECT AT 133 AND 137 EAST OAK STREET
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RECOMMENDATION
Staff recommends that the City Council adopt a Resolution:
1. Approving a Density Bonus Agreement for the continued affordability of a fifty (50)-unit affordable housing project, including incentives related to off-street parking and private open space standards, for a multi-family development at the northwest corner of Hunter Street and Oak Street (133 and 137 East Oak Street); and
2. Authorizing the City Manager, and/or his designee, to take all actions necessary and appropriate to carry out the purpose and intent of this resolution.
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Summary
The applicant, Anchor Village Associates. L. P., a California Limited Partnership, is requesting approval of a Density Bonus Agreement and two incentives for the development of an affordable housing project with a social service space, clinic and management office on the ground floor of a 0.69-acre site at the above-noted location (Attachment A - Location Map and Aerial Photography). The incentives include: 1) the reduction of required off-street parking spaces from 26 spaces to 23 spaces; and 2) a waiver of private open space requirement (balconies, 40 square feet per unit).
The project consists of 50 affordable one-and-two-bedroom units and one on-site manager’s unit. Per Stockton Municipal Code (SMC) Section 16.40.020, the project exceeds the minimum number of units necessary to qualify for incentives. A reduction of off-street parking spaces and private open space in each unit is necessary to ensure the economic feasibility of the project. Residents will have access to multiple transit stops (e.g., San Joaquin Regional Transit District) within one-half mile of the site. The project also provides common open space consisting of gathering areas in lieu of private open space for each unit. As a result, staff recommends that the Council approve the Density Bonus Agreement.
DISCUSSION
Background
On March 17, 2015, an Administrative Use Permit was approved to authorize the development of a 51-unit affordable housing project with 23 on-site parking spaces. A condition of that approval requires that the applicant enter into a Density Bonus Agreement with the City of Stockton before the initiation of the subject use. Further, On June 9, 2015, the City Council approved a Resolution (2015-06-09-1202) for a $1.2 million dollar loan to Anchor Village Associates. L. P., a California Limited Partnership for the development of the project. The project site has a General Plan designation of Commercial and is zoned Commercial, Downtown (CD).
Present Situation
The 51-unit affordable housing project is expected to complete construction at the end of September 2018 (Attachment B - Site Plan). In June 2018, the applicant submitted a Density Bonus Agreement with two incentive requests for Council approval, in compliance with Condition No. 7 of the approved 2015 Administrative Use Permit.
Density Bonus Agreements are usually conditioned to have the Agreement approved in conjunction with the development permit [i.e. the 2015 Administrative Use Permit] (see SMC Section 16.40.070). Here, an administrative oversight resulted in a condition which required approval prior to the initiation of use. In reviewing the project as it moves toward completion, staff discovered that an Agreement was necessary to comply with the original condition of approval and city code.
The proposed Agreement will bring the project into compliance with Development Code Chapter 16.40 (Affordable Housing Incentives/Density Bonus Provisions), ensure the owner(s), the developer(s) and/or successor(s)-in-interest (ODS) comply with the continued affordability provisions, and grant incentives consisting of relief from parking and open spaces standards. The Agreement indicates the number of target units, their size, location, terms and the requested incentives (Exhibit 1 to the Resolution).
Eligibility for Density Bonus
SMC Sections 16.40.030. A.1 and A.2 provide that the City shall authorize a density bonus and additional incentive(s) for qualified housing developments if the Developer(s) agree to construct twenty percent (20%) of the total units for lower income households, or eleven percent (11%) of the total units for very low-income households. The project has 51 housing units, consisting of 50 units of low-income rental units, targeting local individuals and families in Stockton making between 30% (extremely low-income), 40% (very low-income) and 60% (low-income) of area median income (AMI) (Attachment C - Unit Matrix). The development will have the following mix of unit types: 39 one-bedroom apartments (618 square feet), and 11 two-bedroom apartments (893 square feet), and an on-site manager’s unit (1,075 square feet).
Incentive to Reduce Off-Street Parking
Subsequent to the project’s approval in 2015, the California Government Code was amended at Section 65915(p)(3)(A) to prescribe maximum parking requirements for qualifying affordable housing projects. Under that statute, the City of Stockton may not require more than 0.5 spaces per unit (or 26 spaces total) in the project since it meets the following requirements:
1) All rental units provided to lower-income families or individuals except a manager’s unit;
2) The project is located within one-half mile of a major transit stop; and
3) There is unobstructed access to the major transit stop from the development.
The project, therefore, requests an incentive to reduce the required parking from 26 spaces to 23 spaces because the development consists solely of rental units for lower-income households or individuals, exclusive of a manager’s unit. In conformance with SMC Section 16.40.040 (A), the incentive is necessary to provide for affordable housing costs and make construction of the housing units economically feasible. Additionally, the development is located within one-half mile of multiple transit stops to serve area residents.
Incentive to Waive Private Open Space Requirement
The applicant requested an incentive to waive the private open space requirement of 40-square feet per unit (e.g., balconies). Due to the urban nature of the project, it provides common open space and social gathering areas (on-site activity area) to offset the reduced provision of private open space in each unit. Approval of this incentive is also necessary to provide for affordable housing costs and make construction of the housing units economically feasible. Further, the project will provide residents common open space above City requirements.
Environmental Review
This request is categorically exempt under the California Environmental Quality Act (CEQA) Section 15332, Class 32, of the State CEQA Guidelines because it pertains to a project that: (a) is consistent with the applicable General Plan and Development Code provisions; (b) is located within the city limits on a site smaller than 5 acres and substantially surrounded by urban uses; (c) is located on a site with no habitat value; (d) would not result in any significant effects relating to traffic, noise, air quality, or water quality.
FINANCIAL SUMMARY
There is no anticipated fiscal impact to the City’s general fund from the density agreement.
Attachment A - Location Map and Aerial Photograph
Attachment B - Site Plan
Attachment C - Unit Matrix