City Council - Special Meeting

All right. Welcome, everyone. Let's get started. This is a special meeting of the San Rafael City Council. Today is Thursday, June 4th. I'll request the city clerk to call the roll, please. Council Member Bushey. Present. Council Member Hill.

Present.

Vice Mayor Kurtz. Present. Council Member Hidalgo. Present. Mayor Kate. Present. All five of us are here this afternoon. This is a study session, 2026 Second City Council Housing Study Session. So I'll turn it right over to staff to start the presentation.

Well, I think I'm going to lead tonight. Good evening, Mayor Cade. Yes, I know I'm sitting on this side. John's not here, so I'm taking a spot. Micah Hinkle, Community Economic Development Director. Before we start this evening, one thing I wanted to do is introduce a new staff member to the Community Economic Development team. Assistant Director Lou Kirk, who is also our chief building official. So Lou's in the front row. I told him, I said, hey, this is a great one to come and learn about what's happening in San Rafael. Excited to have Lou join us, previously with the city of Santa Rosa, and brings a wealth of experience in both building and code enforcement. So overall, we're really ecstatic to have him on the team.

Welcome, we're delighted you're here.

And with that, so this is a continuation kind of series we have on terms of work sessions where we talk about housing policy, housing questions, housing development, and the tie-ins really of where the city's at and where we're going. So with that, I'd love to turn it over to Assistant Director Greg Miner and... Planning Manager, Margaret Cavanaugh-Lynch, so thank you.

Thank you, Director Hinkle, Greg Miner with the Community Economic Development Department, and we're also joined by our Housing Manager, Alexis Kapitanian. We'll be shuffling seats in a moment. I was just going to offer a quick introduction to help frame this study session and then highlight some of the resources included in the study session packet. So as Director Hinkle alluded to, these study sessions are an opportunity sort of outside of a specific development project to reflect on how housing development has unfolded in San Rafael in the five years since the city adopted its current general plan back in February and, excuse me, and identify any policy process or priority adjustments that may be needed. In February, we focused on state and local land use regulations. Today's session will start with a follow-up from the first session, and then we'll transition to discuss the city's affordable housing requirements and how the state density bonus law has affected them. In terms of study session resources, the staff report is really just two pages. The first is basically just an outline of the content for the study session itself, but the second page includes resources for the public and the council alike if they want to dig deeper into housing policy after the study session. So just wanted to highlight that we have links to the city's affordable housing policies on that second page included in today's packet, as well as a link to the State of California's Housing Community Development Department or HCD's 2026 Housing Law Fact Sheet. That includes like two to three page summaries of all the different state laws that govern housing development. So if anyone wants to dive a little deeper, that's a great resource to refer to. We also have links to a new web page, a frequently asked question and answers web page on housing development in San Rafael that wasn't available back in February, but now if you're out and about and members of the public have questions, it's a great resource. And then we also included a link to our major projects web page, which has been online for several years now but has updates on specific projects. So if you're curious about what's happening with the specific development, that's a great website to go to. One last resource that's not referenced on the staff report that I just wanted to highlight is, for those that missed it, the 2025 General Plan and Housing Element Annual Progress Report that was presented at the March 16th City Council meeting this year. So if you refer back to the March 16 City Council meeting and refer that, you can review that report because it has a lot of good data in terms of how many projects were entitled, how many building permits were issued. So if you want a little bit more data beyond today's conversation, that's a great resource. So with that, I'll hand it over to Margaret and I'll shuffle my seats with Alexis.

Good evening Madam Mayor, members of the city council, Margaret Cavanaugh-Lynch, your planning manager. The purpose of the study session has three main points. One was to confirm whether staff should explore the amendments to the downtown density requirements in light of the resource and work plan implications Two is to establish a baseline understanding of the city's affordable housing requirements and show how state density bonus law has impacted them. And three is to receive input from the city council regarding the city's affordable housing requirement policy. We're not going to go deep into what happened in February, but as you recall, we had three questions for you for folks that weren't present at the earlier session in our community. First question was, should we refine the role of the planning commission? The second was, should we look into creating a new ministerial process that would encourage developments to align with council priorities? And the third, which is the one we're going to explore in depth tonight, it was to explore amendments to the downtown density requirements in an attempt to decrease height. As you recall, answer to the first question was to have the commission maintain their discretion for housing projects. And just to say a little bit more about that, it was an educational role. It's so that people have a place and a venue to come and talk about the housing projects, understand the details, and have staff and the commissioners explain the context and basically the state regulations that govern most of the housing projects that come before the City of San Rafael. The second item, staff reached out to Sacramento, Berkeley, Petaluma, Morgan Hill, and Oakland. We were basically looking for cities with cranes, and a few of these also have smart stations, so we're looking kind of as a comparable city. They all have something on their books that lifts their council's priorities and no one is taking them up on it. They're all using the state density bonus laws. So that was information we wanted to bring back to you. Council Member Hill.

Thank you for accepting a question midstream. In all things being equal, did each of them have aggressive incentives for some of those ministerial processes?

Yes, of sorts. So the danger is the floor of the state density bonus regulations is low enough that you can't put too many incentives in before you just join that other arena, right? They all had items like you can be ministerial if you add enough plaza open space or usable open space or all the things that you would see in our precise plan as items that we'd identified as priorities beyond housing, the frosting, the other items that we would like to see to make our downtown vibrant and whole. They're in the same, the good news is everybody's having the same discussions. Everyone that's seeing the state density bonus laws apply in their city is seeing that that's the path that they're using, at least in the cities that we spoke to. Which brings us to the part one of this meeting's discussions. So since we've seen you last, we've met with the Housing and Community Development Department with the State of California, as we affectionately call each CD. And they were actually, I guess, to my surprise, supportive of this conversation. And I want to quote them. They felt there is a lack of clarity with the unspecified density. They're getting complaints from other cities. Development teams sometimes wrestle with it. They don't know what to do with interstitial space, the stairways, the... bathrooms right they it starts to be what do you mean by average dwelling unit and hope and and stair corridors so there's confusion in development teams there's confusions in other cities about how you define this um so they they thought it would be a great idea and then they cautioned us that any changes would need to be compliant as you know with the housing accountability act the housing crisis act and all housing element law so they were They were not only collaborative in nature but they were interested in having additional conversations with us which was really heartwarming. We then went out and did a request for proposals to certain Consultant firms that are qualified to have the conversation. This is this is a special subset of knowledge that speaks housing element that speaks density These particular types of regulations is a small subset of the planning world and we received two proposals that we have set aside based on how the outcome of this meeting goes so that brought us to basically understanding about the steps that we would have to do. They're starting to come into focus. The first thing we would need to do is basically it's the research. We need to take stock of important metrics and how the city is where we are with them. That would include reviewing our existing housing element, reviewing our downtown precise plan, reviewing our regional housing allocation arena standards, numbers that were given to us and then Looking at all the other applicable estate housing laws that are related to it, including all the no net loss requirements and all of the regulations that I'm sure that most of you are aware when we did the housing element, the affirmatively furthering fair housing regulation. So there's a lot of data we need to go gather and look how... what's in place and how we're doing so far. That's basically the step one that we'd have to do before we could do anything else. The second step would be to go back to our new collaborative partners at Housing and Community Development. report back, this is what we think we see, this is how we've gotten this information, do you agree with this numbers and what we've come to as a draft summary? And if they do, there's one of two pathways that we would go. So we would wanna talk to, and that's the next slide, but we'd wanna be like, so this is what we think we're doing next, just to make sure that we're with them in lockstep, because they have final say over the housing element and this entire action. The two pathways. Pathway A. We do that first step, we gather all our data and we find out that we can add back density limits without amending the housing element. Then we would create basically a report that would have the findings of what we did and how we arrived at our solution, and we would basically amend our documents to reintroduce a density limit. So that's a very straightforward path. I think all of us on staff have an idea of what documents we're gonna amend and how that would go forward, but we'd have to have the data to support it to go there. Pathway B is a little more challenging. So if we find that we need to basically open the housing element back up to redistribute the capacity. Then we have to identify those new sites. Then we have to basically ascertain if it's possible. So if we have RHNA allocations, if there's a, we've got a lot of housing in downtown, as you know, so I'm mostly concerned about the RHNA numbers, but not to get ahead of us. If we have housing units we need to reallocate, we have to go through the process of what that would look like, and that does open up our housing element again. And that would likely reopen the certification process as well, because we've just opened that up. We did really well. I'm not saying that would be, it's just a piece of data to know. And that the cost estimates for this work, if we do Path A, it's about 80,000 and it's about a year. If we have to go Pathway B, it's more like a hundred and sixty thousand and these are preliminary estimates with uh... estimate for legal time an estimate for the consultants that we've seen uh... when they're in their proposals and it would take about two years and that's if we can if we're on pathway b there's are we going to be able to find all the sites we want right and so there's there's that's pathway b is more uncertain but so that's the numbers the cost estimates we didn't have last time the approximate time it would take I really wanted to, and we were talking about this at the staff level, there's still a level of uncertainty, and I wanna be really clear about that. There is uncertainty that introducing density back into the downtown will have the desired goal of lowering height of all future housing projects. Even the gentleman from HCD said, well yeah, that would be great, that would really help us, because we were having a lot of confusion on the not defined density, but I don't think it's gonna affect your height. So, okay, there's math involved in this and we can talk about it. It's worth noticing that, well, for legal reasons, I can't actually give you a specific address of a development project, but I can think of a few development projects we've had approved in our city that had a density bonus of 30 feet above their base height. based on what they brought to the city in terms of affordable housing and proximity to transit. So it's a formula. So we're just changing one thing. There's other things in play. The second item to bring to your attention is something that we're all very aware of. We love housing. In case it sounds like I'm nervous about this, we're all excited about having housing added to our city. This is just the mechanisms that we're working with today. The state housing laws will continue to evolve. So we might do all these things and another regulation might come along and it may impact what the goal was we were trying to address. So we're in a period of time where the housing laws are changing every six months. And the last point is that HCD shared with us, and we were talking to the section chief, so I believe that we were hearing things from people that were very educated in the topic. No other city has modified their housing element to reintroduce a density cap, so our pathway B would be untested. So there's some uncertainty about that that we wanted to make sure that we brought to your attention. With all that said, how would the council like to move forward? Should staff explore the amendments to the downtown's density requirements? And if so, should staff report back to the city council or maybe start with the Housing and Economic Development Subcommittee after that step one? Because that's gonna be when we get all our data together, we're gonna know which path we have to take. So that's my first question. And then B, is there work plan implications to, as you know, This is not on our strategic plan. It's not on our work plans yet. and Alexis and I and Director Henkel, Assistant Director Minor, we all sat down and started talking about what that would mean. So again, as you know, we have four goals in our strategic plan right now. The A3 is enhanced neighborhoods and that's the one with both the specific plans in. There's streamline and modernize the city's land use regulatory framework. That's our objective design standards. That's the comprehensive zoning code update of what you've already seen, 1.0. And in the Ds, we have advanced development of new housing across all affordability levels and evaluate and consider the implementation of specific housing policies. So Alexis and I... sat down and sharpened our pens and so if you would like to direct us to do this we would ask you to maybe consider not the specific plans because we're on a state mandated grant program that has deadlines and they've been really great with us but they want us to be wrapped up by december of 2028 unless there's a really compelling reason so what's really on our timeline is the objective design standards the zoning code and the evaluation of below market rate program that you're gonna hear a little bit more about in just a few minutes. So those were the ideas that we came up with to offer as a consideration. Obviously, in the end, you set the priorities and the city manager sets those up and it goes to the director, but we wanted to come with some real things that we could offer up. So that's the end of my part of the program. And I think it makes sense to pause at this time and talk more about the questions or just have that discussion.

Thank you, Margaret. I'm going to ask Andrea. So typically the council asks questions and then we have public comment before. So before we answer the questions and things, by the way, for having the prompt, because This is such a broad topic we could spend all evening here talking about lots of different parts. So really appreciate the neuro. So my question to you is, should we do it in pieces? We can have the rest of the presentation do all the questions and then do public comment once. Or we can ask questions now, have a public comment, close it, and then go to the next section. Not knowing that scope, and I'm also looking at our city manager, the scope of the presentations, I want to make sure we have time to do.

I would recommend doing clarifying questions right now just so that it's fresh and your questions are considered within the context because the two presentations are different and then go to public and have the clarifying questions for Alexis' presentation, then go to public comment and then have your deliberations after that.

Okay. Thank you. Sure. Because it's such a meaty topic. So I will look to my colleagues. Questions, I know we like to sometimes have comments in those questions, but let's just have clarifying questions, please. Yeah, go ahead, Vice Mayor.

I do have a clarifying question. On pathway A and pathway B, do we have to choose one or the other, or is there a pathway C of do nothing, stay where we are today?

Oh, absolutely. Council Member Kurtz, we could finish step one, So we could just stop right here tonight. We could do step one and get that summary and bring it to either the subcommittee or to the full council and it could end right there as well.

And what would be the risk of that?

I don't think there's any risk in collecting data and having more information. We'd be allocating funds, there would be some impact, maybe our work programs, but that's mostly going to be what the consultants do, is we're going to give them all of the data and they're going to come back with that report.

And there still would be a choice of whether we choose to have them do that report?

Absolutely, we've got their proposals, but we haven't, we thank them, but we haven't spoken to them since because we really wanted to hear what the council wanted us to proceed, what the next steps would be. So we haven't taken it any further. We could make the contract the option, you know, go get that data, stop, or go get that data and do pathway A or pathway B at the city's discretion.

Okay, great, thank you. Thank you.

Yeah, Council Member Micah.

Yes, thank you so much for the presentation. So I think I hear you saying that when you were talking at the state level, they mentioned that they haven't seen any cities that they actually went ahead modifying the housing element. Do you speak about like the other pathway where we don't modify the housing element? Did they mention if there are cities that they have modified?

Well, the quote we have from the state staff was, we're not aware of any city that has undertaken this, but if they didn't open their housing element, we might not even know.

That makes sense. Yeah. And interesting. Thank you.

Thank you.

Council Member Bushee.

This question comes from perhaps my lack of knowledge on because I missed the first presentation, but I just want to clarify that this proposal that you're bringing forward to use density limits as a way to limit heights. is the only feasible approach to address the extreme proposals that we have received. Is that your conclusion?

Yes, and it's because of the state density bonus laws as they're currently written, when a project qualifies for that program, qualifies for that bonus program, they can waive our height limitations. So that's what we're seeing is they're, in order to add the number of important below market rate units that they're proposing, they can ask for unlimited waivers. So that's our height, that's our public open space, that's bike parking on a few of the projects we've seen. So we basically, it kind of explains state density bonus law as much as anyone can, honestly, without a full attorney background. And what we came and asked was, we are seeing the tallest projects are coming into the part of the city that does not have a density limit or a density cap, right? So this was one idea that might work and we asked the council if they wanted us to dig a little deeper and that's what we've come back with tonight so by adopting the density limit it will override the waivers for the height well this is where it gets mathematical and kind of formulaic so When a development team comes in with a project with a certain amount of affordable housing or below market rate housing, they qualify for certain state density bonus regulations and we have them draw a base project. So this is, if you're built only what the downtown precise plan, I know this is terrible.

I'm sorry. It doesn't matter. What I really want to know, is this the only way to address the extreme proposals that we've been receiving?

This is a reasonable way to approach this issue that we're seeing on height. Okay, great, thank you. Sorry, I don't mean to get, it gets instantly in the weeds so deep that, yeah, thank you.

Thank you. Council Member Hill.

Thank you, Mayor. Thank you, Margaret, for the presentation so far. On face value, and again, like you, I am not an attorney. And even if I were, I don't specialize in housing law. However, when I hear having a density cap, on face value, that would seem that it could violate SB 330, which doesn't allow for down zoning. Are we confident that this would survive an SB 330 test?

So that is one of the things that we would be working on. So the first step is to make sure we have all the information available that we need, and part of that is the housing laws themselves, right? So it would have to be whatever we decide, and that's step one. It has to be compliant with SB 330, the Housing Accountability Acts, the Housing Crisis Act. if we at the end of step one we will know if we need to allocate housing outside of the downtown and then based on those laws so the short answer to that is and that's a really uncertain point just as we're sitting here this evening.

Yeah and I think what I'm hearing is that if If option one relies on having to do that, then it would require a displacement for what, you know, an offset is what I'm understanding.

Right. So if pathway B is we find out that we have to reallocate housing units outside the downtown to stay compliant with all of the state laws that we are required to follow. Okay. Thank you.

Thank you. And I just have one question. So on Pathway B, if we were to choose that or decide to go that route and we open up the housing element, are we still considered compliant with our housing element, so not subject to the builder's remedy during that time period? Or would we be exposed to the builder's remedy because we're opening up the housing element? Or does the current one stay open? ensure that we remain compliant. Do you understand what I'm, okay.

I do understand what you're saying. Um, that is a great question and one that we have not considered what the timing is. I mean, we can, we have a compliant housing element right now, so we can under take all of these studies, um, and move forward and we're not subject to the builder's remedy when it actually comes time to, let's say adopt, a new housing element if that's what's required, and should there be some sort of legal challenge to that, we would need to figure out how to ensure we revert back to our current housing element. that's what I would want to do as the city's lawyer. And that's fine.

It's just, it's another aspect of pathway B that I just wanted. Yeah. Okay. Thank you for answering. I don't see any other clarifying questions. So Alexis, we will hear from you.

Great, good evening, Mayor Kate and City Council, Alexis Kaptanian, Housing Manager. And we're gonna change gears a little bit and talk about the affordable housing requirements for residential development projects. I'm gonna provide an overview of the city's current local policy, and then we're gonna talk a little bit about how it's interplaying and interacting with the state density bonus law in recent years. So just as background, the city has a policy that requires residential development projects within the city to contribute to the attainment of affordable housing goals and requirements. One way that residential development projects can satisfy the city's affordable housing requirements is by providing a percentage of the project's proposed units as affordable to moderate or low income households. So we can think of the existing city policy in sort of three components, the percentage of affordable units that we require. For those affordable units, what's the level of affordability that's required? And then what are the development standards for the affordable units in these residential overall market rate projects? So for the percentage of affordable units, this is a policy that was adopted by the city council in 2021. For projects 15 units or less, we require 10% of the proposed units, excluding density bonus units, be affordable to and occupied by a low income household. If the project is greater than fifteen housing units there's an the sort of an menu of options one is to do ten percent low-income on-site uh... the others to do five percent low and ten percent moderate and we are also required to provide other options for developers so there's also an option to pay an in lieu fee instead of building the units on site uh... there is uh... you can provide off-site affordable units meaning not at the site of the market rate development project. And you can also provide a land donation to the city. But today we're really focusing on the provision of units on site and far and away what we're seeing lately as the most common choice for the larger developments is 10% low income on site. And we'll talk a little bit about why that is. So in terms of the level of affordability, currently the affordability level is not specified in our municipal code, which is a little bit unusual. So the rent limits default to state standards. So we define very low as 50% of the area median income, low as 80%, and moderate as 120%. This was a change in 2021. Previously, San Rafael's rent limits were lower. So you'll see that a lot of our BMR portfolio, our below market rate portfolio, has low income units restricted at 60 or 65% AMI. And then finally, there's a set of development standards for how those units that are affordable units that are provided should look and where they should be located within the development. So the first requirement under development standards is that the affordable units are dispersed throughout the project unless the city determines that clustering of furthers affordable housing opportunities and that requires discussion during a public hearing for that exception. And then the second is the comparability between affordable units and market rate units. So the city requires that affordable housing units be of a similar mix and type to that of the residential development project as a whole, including but not limited to the same or substantially similar mix of unit size, so number of bedrooms, square footage, and then compatibility with the design, materials, amenities, and appearance of the other developed units. And we interpret the similar mix and type to also include tenure mix, meaning if it's a rental project, you provide rental affordable units. If it's an ownership project, you provide for sale affordable units. So just briefly, how does Santa Falls policy compare to other jurisdictions in the Bay Area and some state and regional standards? In general, when we compare to some of our neighboring and comp jurisdictions, Sarafell's policy requires a lower percentage of affordable units, and that was an intentional strategy adopted by the council in 2021 to spur housing development. We have higher maximum rent levels, and then our development standards are pretty typical, kind of fall right in the normal range, I would say. A few examples, the County of Marin is at 20% affordable. They have a menu of affordability options. They do define low income at 65% compared to the 80% we're at. And one thing that's really interesting, so their development standards are similar to ours overall. One thing that they do state explicitly is that ADUs and JDUs cannot be used to satisfy affordable housing requirements. In Novato, it really depends on the project size, so it ranges from 10% to 20% affordable, with projects of 20 units or more required to provide 20%. They define their low income at 60% AMI, and they also require some very low incomes at 50%. They have a little bit more flexibility in their development standards in that they have our requirements, similar requirements, but they do limit the square foot and bedroom count requirements for affordable units. So they might say after 900 square feet on a rental, it doesn't have to be an exact comp. Just a couple other examples nearby. Petaluma is at 15% affordable for projects with five or more units. They, like Novato, have half at 50% and half at 60% for their rental. And then the ownership they have at 60% and 120%. And then finally, Concord is an interesting example for projects of five or more units. They're at 15% affordable for ownership. At the rental, they're lower. So I haven't talked to the Concord folks. They might be trying to really encourage market rate rentals. But they're at 6% affordable with sort of a split on the affordability levels assigned to that 6%. They also have a different, they have similar development standards, but they allow for smaller units or lots by 15% of the average for those affordable units. And they require same exterior, but they allow for alternative interior finishes. So just to kind of give a flavor, there's a little bit of a range. And then finally, one regional standard that's come out recently is a bags transit oriented communities policy, which will have implications for discretionary funding. They're at 15% for their inclusionary zoning standard. And again, we're at 10% for housing affordable to households at 80% of AMIs. So that's kind of where we are in some of the ecosystem. And now I'd like to turn and talk about the impact of state density bonus law on affordable housing requirements in San Rafael because it's been interesting in the last few years to see how this has impacted the outcomes for some of the entitled projects. So just Margaret kind of did a nice primer in terms of state density bonus law is Developers can get additional density by providing a certain percentage of affordable units and they can also get concessions and waivers that allow them to modify development standards. So just kind of high level takeaways. For some of our projects, we are seeing that they use state density bonus law, and we're actually getting more below market rate units entitled. Not the percentage, necessarily, of the overall project, but just the number count. Then the other thing we're seeing is that low and moderate income units have lower rents. So I'll talk a little bit more about that. And we're also seeing developers provide some very low income units, which is not something that our current local affordable housing requirements require. And then lastly, With the state density bonus law, there's the potential for BMR units to be less comparable to market rate units and less dispersed throughout the project. So we're seeing potential modification of some of the development standards based on concessions. So as I said, because developers are Building with additional density, often we'll see an increase in the number of below market rate units provided in exchange for density and concessions and waivers. And then in terms of affordability, this is a really big deal. The city's inclusionary is at 80%. State density bonus law is set at 60% of area median income. And I put here examples of what that means for a one and two bedroom unit. The difference at the last column is the difference in maximum monthly rent. So there is a $800 difference per month for a one-bedroom unit and a $900 per month difference for a two-bedroom unit when you're talking about 60% versus 80% AMI, which is huge. So that's creating a different level of affordability for residents in San Rafael with the state density bonus law. uh... we are also seeing again some projects come in who are choosing to provide very low income uh... based on the state density bonus law calculations of what you can get by providing very low income units one thing i want to point out So the state density bonus law requires affordable rent at 30% of 60% of area median income. The city has the option to define rent, affordable rent, as 30% of actual household income, which is obviously favorable for the developer. Because then if a household, for instance, is at 70% of AMI, the rent is pegged to their actual income. Exercising that optional authority about affordable rent requires city council approval on a case-by-case basis. So if it's coming through the staff level, it will be 60%. And then finally, BMR units can be less comparable to market rate units and less dispersed throughout the project. Again, this has to do with the concessions that developers can receive. Frequently, we've seen projects that provide that 10% level of affordability, and then they get one concession, and they get to choose how they want to use that. This is just one question that's come up for other cities. Sorry about the block of text. Don't expect you to read it. I will paraphrase. But this is a letter from HCD to Sonoma County. The question has come up for jurisdictions. Can developers use a concession on the affordable housing development standards? This is their response, saying yes. Developers can use a concession on an affordable housing development standards such as the comparable affordable market rate units that we were just talking about or the dispersal of the units throughout the project. So examples of some affordable housing concessions, there's a lot of different ones. But for instance, you might see dispersal across lower floors only, not throughout the project. You might see a difference in the exterior. Some have balconies, some don't. You could see reduced square footage for the affordable units compared to the market rate. And you could see rental instead of ownership or even ADUs instead of townhomes. I want to just mention that some of these concessions may be greater concern than others. Some may not be as much of a concern for the council. When we're thinking about these factors, we might think about, is there visual integration between the market rate and the affordable? Is there a difference in materials that would make a difference in the durability of the affordable units? Does it create a challenge for staff to administer the program, depending on how it's set up for sale versus rental? And then what are our community housing needs? For instance, if we decided we're not going to make anyone have a three bedroom affordable unit when we know that in the housing element, that was one of our identified needs was rental units for larger families, just as an example. And then what would the impact be? if there were compounding concessions, we start to get a real lack of parity. And finally, just there's a tension between Overall, we want the supply of housing and how do we lower the barriers. And we definitely much need, like we greatly need the affordable housing. And so those are, that's some of the push pull here. We are behind in all of our income categories for RHNA. And so we need all of the different types of housing. And that's part of the backdrop of this conversation. So just in summary, state laws impacted the application of our local affordable housing requirements policy. Large projects, which is what we've mostly talked about this evening, using state density bonus law are providing lower rents. And sometimes they're providing more units, but they can provide less comparable units via concessions. Smaller projects may not use state density bonus law. And in those cases, our policy is the threshold requirement. And so we're about to ask you a couple of questions. If we take no action, that kind of results in a furthering of our supply side approach to the affordable housing requirements, meaning that we want to see market rate projects built. So finally, just a few sample pathways and the work plan implications. These are not exhaustive of the pathways you could take, but just as an example, in terms of the inclusionary percentage and the affordability level, the council could maintain them as they are right now. So 10% of units affordable to households earning 80% AMI, for example, for the low income units. The council could increase the inclusionary percentage up to 15%, that would not require a feasibility study based on HCD, based on state law. If the council wanted to increase above 15% or lower the maximum rent levels, that would require a feasibility study. And then the other piece is the development standards, choice between maintaining the 2021 standards as is within the current policy landscape or amending based on the current policy landscape, which has changed since 2021. So those are our questions for you. Should the city retain or amend its below market rate unit development standards given recent guidance issued by the California Department of Housing and Community Development regarding concessions under state density bonus law? And is evaluation of the inclusionary percentage and affordability level a current priority in the context of the overall work plan? So here's a recap of our joint three questions for you, and we're happy to take questions.

Thank you. So we will have clarifying questions before any commentary. So any clarifying questions? Vice Mayor, go ahead.

Alexis, thank you for the update. It's good to bring this conversation back. Are you aware of any jurisdictions at this point that have changed the inclusionary percentage and what did they use for direction in terms of why they would change it?

So about two years ago, Marin County did a countywide feasibility study that all of the jurisdictions were able to use. And you'll recall that we came to you and we did an update of our commercial linkage fee and our inclusionary in lieu fee. uh... Sarah felt chosen at the time not to use that study to update its inclusionary because the council had recently updated and we wanted to see how that performed uh... but That was when a number of Marin County and others updated to that 20% level. And it was based on an underlying feasibility study at the time of here's a couple of prototypes. Is it feasible to have a 20% inclusionary?

And do you have any information if that actually produced more affordable housing, that 20%?

in the jurisdictions where it was adopted. I don't have an outcome on that policy at this time. I think we're happy to kind of talk to our neighbors and see what their thoughts are now.

And do we have our results with the 10%?

Our results with the 10% I think would be part of the question three, which is, is this still a priority to look at at this time? We have seen a lot of entitlements come in, just at a very high level. We've seen a lot of entitlements come in. We haven't yet seen a lot of buildings built. But we could definitely, if it's a priority for the council at this time, we could go down the road of having a consultant evaluate that as part of a package of you know, here's what we've seen, here are the prototypes, and kind of bring forward that full package. I think the question that I have is just because the environment has changed, I know that was a priority, and I just want to make sure is it still, is it not?

And just so I have an under, confirming my understanding, the, we went with the inclusionary conversation as a tool in our toolkit. But now with the state density bonus, that is addressing the same goal.

Yes, it's overlapping and we're seeing, particularly for large projects, that we're getting a deeper level of affordability than we would have with just our policy. Thank you.

Thank you. Council Member Bushee.

A very specific question. Would reconsidering our treatment of ADUs and junior ADUs require the full priority review?

So the development standards piece, which I'll put up here, the bottom piece here, the development standards including ADUs and JADUs would not require a feasibility study. But if we wanted to change the percentage inclusionary above 15% or lower that affordability level, then that brings you into the feasibility study.

But the tweak for ADUs would not require that.

Correct.

Okay. And just to confirm, all of the projects that have come in will be processed under the existing rules, and should we choose to continue on this review path and adopt something new, it would only be for future applications?

That's correct.

Thank you.

Thank you. Council Member Irenz-Giletti.

Yes, thank you. This is something that I have asked before, and I don't know that we know, but about the vacancy rate that we have in San Rafael. That's something that the county, I guess, will have to provide, but I'm just curious to see how we, if you know how we are doing as a city right now with the current housing, and what vacancy do we have?

So we have, I do check this every year because we have a condo conversion ordinance that kicks in when we have a rental vacancy above 5%. We have been below 5% during my time at the city. The Rooted in Marin report I think provides a little bit higher number for all of Marin, but San Rafael in recent years has been below that 5% level for rentals specifically.

Okay, for residential? Yes. Okay, thank you.

Thank you. Council Member Hill.

Thank you, Mayor. Thank you, Alexis, for the presentation. Just to confirm a few things, as you mentioned in your testimony, which is we're behind. But my question will be, and maybe you can or can't answer it, but I'd love an answer anyway, which is are we achieving a sufficient amount and are we showing enough goodwill and good intention that we would not end up experiencing the metaphorical teeth of HCD on the other side of the cycle?

So what we've seen is that HCD and the Attorney General are going after jurisdictions that are either doing nothing or even obstructing housing development. And so I think it's really important that whatever path we take, we're able to articulate how this is increasing housing overall or affordable housing. And there's different ways to do that. And whether it's a more supply side approach and lowering barriers or it's prioritizing we want to try to get more affordable units. So is that helpful or not really?

For an answer that looks like it's sufficient or it's in the San Rafael is our approach if we continue to our approach. Resulting in San Rafael, we have achieved sufficiency and we won't experience some sort of penalty that makes everything ministerial after a certain date.

I understand. We have not received any feedback on our inclusionary that it is insufficient or under investigation or anything of that sort. Yeah, it's sufficient and not wildly out of line with other jurisdictions either.

Okay. We would have received a signal at this point if we were obstructing, right?

Right. We are not bringing this forward because we've had any sort of interaction with HCD.

Well, the only reason why, yeah, okay, thank you for that.

Maybe through Mayor Kate, Council Member Hill, I think it's really important that we actually look on the implementation measures. You know, the simple fact we have a crane flying in our community, we're housing developments moving forward with units under construction, I think is a critical step. One, we have not had in a good amount of time. So we are making those progress with multiple other projects within same framework of that. We are making progress in multiple ways. So that's where I do think from the state's perspective and HCD, They're looking for projects, trying to solve the housing crisis with development and occupancy of housing. And we are making tremendous efforts in those areas.

Thank you. I know the mayor described that we not start to give our talks at this point, but I do want to frame the question around the macroscopic environment. Because while these questions are important, Since we, I just want to bring us back to 2021 when we said we need to reduce. Because I remember, if I can surmise where we were and why we did that, is that we said 0% of zero is zero. So we said, we are going to reduce this because we need to get something. So now we're seeing more entitlements. And my question is that when we see the array of dials in front of us, these are a couple. But the bigger ones that are macroscopic, some are in our control and some are not. Some of the big ones are we've now moved out of zero interest rate policy. So that's one barrier. We are materials and labor is becoming more expensive. The cost of money and borrowing is more expensive than it was. And so when I think to myself, OK, so if we tune it one way or the other against that backdrop and things will eventually change, is it really going to produce what we want given what we've promised the community? in our general plan and our current housing element. So when I think about just in broad strokes, we want our density to happen downtown. We want affordable housing for folks so they can live here and we can have the economic growth that we want. And the concern is that if we tune it back up to 20, is it going to reduce it and create more impediment? Or if we tune it down, are we not going to get enough affordable? So what I'm concerned about is if we, from this dais, just say, let's tune it this way because that's what I think it'll do. So I appreciate the questions are framed as it's going to explore it, but to your point, that would mean that we're going to have to displace something else. So I guess what I'm basically saying is that my question is, so my question is, as we think about the lens of a developer, when we tune it up or tuning it down, Can you describe quantitatively, or at least qualitatively, how a developer would interpret that? Because my sense is that it's still, for inclusionary, if you increase it, it might have the effect of either reducing or changing the types of developments that they would come forward with, or at least suppress them. If you tune it down, it might increase developers coming forward, but it might reduce our low-income, our BMR housing stock. Would you just confirm that?

Yes, absolutely. I think that's the crux of the question is, is it Do you want to consider this question further at this time, or are you comfortable with the current policy? And absolutely, there's an impact for developers when we, and not just this as a sort of fee, right? Any fee is going to have an impact on the pro forma, and so I think that we're always trying to find the balance in these policies.

Okay, thank you.

Thank you. I just had two questions. One, I think one of the council members asked before. So of the cities, did their policies move the needle? And I think the question was, did their inclusionary, but it's not just inclusionary, it's the three, it's the whole package. So we can't really tease stuff out separately. So of those, and granted they're all very, none of them are the same, but I'm curious if you have any sense that they had any success.

So I think there's a ton of different factors, so it's hard to isolate this. But I think what we'd be happy to do, and whether it's coming back to the full council or coming back to the Housing Economic Development Subcommittee, is to look at places that have had a lot of success with building housing and kind of bring you a profile of what their policy is

not just this policy, but their full lineup. Right. No, that's really helpful. Thank you. And then the other question. So under, there are three different aspects, as it were, and one is the development standards. And what you listed in the comps was ADUs, JDUs, unit size, interior finishes, and bedroom counts. Are there any other development standards? Those are the ones that showed up in your slide presentation. But when you say that, those words, I just want to make sure we're... again, defining it because it's a third of the equation and within that third. Is this the slide you were talking about? No. So under you had my slide right here. So you had the supply side approach on slide 23 just talk about typical development standards. Right. I think it came through. Oh, I see you're saying development standards. And so on this one, location, so I guess are these the primary ones? Maybe that's what I'm asking. I understand. We're getting really granular, but I think what we're going to be struggling with, along with the community, is there are different aspects of development standards. Some we have policies about, and some we don't. So I'm trying to get my hands around if there are other ones we'd want to consider or not.

Absolutely.

The similar mix and type, including number of bedrooms, square footage, compatibility with design materials, amenities, access to amenities and appearance, including interior, exterior, this was kind of the starting point I was going from. I made some comments on some other policies because they sort of stood out a little bit, right? So here I said, okay, Marin has this no ADUs, JADUs. That's not necessarily a typical development standard, and so I just highlighted it there.

So if we wanted to explore development standards, which is a piece of this one, that would be part of what additional consultant would look at because there's so many different iterations that we could have. Okay.

Absolutely. So if this is something that the council would like more information and more nuance, you know, there was a lot to cover even without that level of detail, but we'd be happy to get a little more granular if you said we want to look at the development standards specifically.

Okay. Because all those have, to your earlier comment, have a dollar sign attached to them. So, again, we're trying to tune it. And having us say, oh, with this one we believe in and this one we don't, it's probably more us giving when we get to that point. where we want to go and then staff figuring out how we would get there with development standards and 10% inclusionary and everything else.

Okay, that's helpful.

Yeah, go ahead, Vice Mayor.

Related to the comparability, is that decided at planning commission or discussed at planning or is that prior to going to planning? Who gets to have that conversation around what's gonna be reasonable?

So that analysis, it starts at the staff level. So staff will take in an application and look at, okay, what's the below market rate proposal as a component of the project? And then we'll side by side with our ordinance and resolution and give the applicant feedback. And so when we bring forward to the Planning Commission the full project for consideration, one piece of the analysis is we found it to be consistent with our affordable housing requirements or not.

Okay, great, thank you.

Thank you, yeah, Council Member Micah. Yes, thank you. I'm curious, so when we are talking about the level of income, we've been talking about low income and moderate income, so we don't have any very low income,

So we do have very low income units in our portfolio, and we do have some entitlements that have come through with very low income, in part presumably because they're using state density bonus law and they receive a concession for that. The reason in my presentation why I talked more about the affordability level of low and moderate is because very low is sort of across across standards at 50%. It's very rare to see 40% as the standard. But low income and moderate is where we might see a difference. And we do see a difference between, for example, the city's policy and the state density bonus law.

Okay, sounds good. And I'm looking at the salaries. And so very low income would be like about $65,000 a year for one person. So I'm just thinking like low income is, you know, it's not like a small amount when we are thinking about affordability. So anyway, and I do have another question is when we are thinking about some of the organizations like non-profits that they build housing, like Eden Housing, Habitat for Humanity, do we have like any, is this part of the study that we have today as trying to incentivate those organizations to come to San Rafael?

So that's a great question and sort of another complementary body of work, which is what are the tools we have in place for affordable housing developers? Particularly, we've talked a lot tonight about market rate developers, but affordable housing developers often need a different set of tools. And I think we've identified some areas in conversations with affordable housing developers where we might have opportunities to strengthen what the city has in place potentially for those developers.

Okay, yeah, because that would be great. And my last one is we are only talking about new development. We are not talking about like existing housing that needs to be remodeled and all that.

That's correct. We're talking about new construction.

Okay, thank you. Thank you. Any other questions? Yeah, Council Member Hill.

This question was without preamble. On slide 36, I recall you indicated that there could be a compounding effect of concessions. Can you clarify that that would mean that we could not create any nuanced, you know, one type of concession or another that you'd have to allow all or none? Or could we create some sort of restriction on compounding concessions?

Yes, I think the Council has the authority to structure the policy either to be more discrete, right, have those requirements be more discrete or more lumped together in terms of concessions that are allowable. And, right, one concession might be slight, but if you have someone kind of take advantage across the board of five different non-comparabilities, you can imagine how you start to see a really, really different unit.

And then one follow-up is that I would speculate that The reason why a developer might want a concession is that it might cost less or involve fewer materials in construction. So if we did explore that, obviously I'm imagining, or you can just confirm, that we would, as part of the study, understand how much that would actually change a pro forma that a developer might contemplate based on concession formula.

Yes, that's right.

Thank you.

Thank you. Any other clarifying questions from the dais? Council Member Bushy, you're good? Okay, so I'm gonna open up the public comment, and we actually have had two presentations. One is on the downtown density, and the other is on affordable housing. As always, we're interested in whatever you'd like to say. And I think it's most helpful for the council if you speak to those two topics, because that's what the study session is about this evening. So if you would like to speak, I'm going to open up the public comment. You're invited, but not required to say your name and what part of San Rafael you're from.

Hi, Richard Falk, Loch Lomond area. I'll talk to the first part about the density in downtown. So I strongly disagree with the proposal. I think it's too soon to do that. I would only do, assuming it's a dwelling unit per acre, going to. Because if that's done, then you can't use the part of the law that says you maintain the project details between a base project and the other one, which is what would restrict the height indirectly mathematically. That part of the law is just not getting followed right now. And if that was, it would solve the problem. But you don't want to go to court to resolve it, so you want HCD to rule on it. So I haven't met with the people here. I've met with other people about this. So what I'd like to do is encourage the council to have a meeting with Margaret and the attorney at a minimum, because that's a much cleaner path. And I sent examples of why the dwelling unit per acre one doesn't work. I mean, there's historical ones where That won't limit the height. So basically, you get the developer in a form-based code gets to design the density. They design what they want. The density is based on the design. They want a dense plan, get a lot of units. If they do a loose plan, they get fewer units. Because of that, the law explicitly says, and that's the type of scenario when you're not using dwelling unit per acre, that you have to maintain the relevant project details between that base density study and the proposed project. They're only doing that for unit size. They're not doing it for the other project details, of which there's really only two main ones that are relevant. The vertical density of floor to floor height, horizontal density of how many units per floor on average you're getting. That's why they're going so tall. If the law is followed, they won't go tall. But like I said, an HCD letter is the way to get that resolved. I'll write it. You can change it. Anyway, I've used up my time, but I'd like to meet with the relevant people. Thanks.

Thank you. Anyone else like to provide their thoughts or have questions?

I'm going to need... beg your indulgence a bit because my focus really is on things that we can do as this policy discussion and consideration is going on. I'm Jeff Rhodes. I'm speaking on behalf of San Rafael Heritage. San Rafael is Marin's central city. This is a benefit and a burden. We have the greatest concentration of employment, transportation, and the most urban historic downtown. We also provide a concentration of services to those in need, like the unhoused. Our downtown competes with other Marin villages, and we lack their preciousness. In this context, how can we succeed? Significantly increasing downtown housing can provide a catalyst for a more vibrant downtown, one that doesn't shut down at 8 p.m. Our success is dependent upon addressing our challenges and embracing our vanity. Here is a list of additional things we believe will lead to a downtown renaissance. The first of which is to protect and enhance our historic resources, particularly on 4th and B Street, for their placemaking value. Update the downtown precise plan historic resource inventory. Establish specific standards for each building in the inventory so the developers know the city's requirements. Bear in mind that historic resources have protection from waivers. Encourage architects to do their best work on new buildings with voluntary precise plan guidelines. Invest in arts and cultural institutions and program activities. And finally, and this is the most critical I think right now, is focus on placemaking, creating downtown squares and programmable spaces. My correspondence has specific recommendations, and I've provided that to you, A timely and unique placemaking opportunity is the downtown transit center. We seek your support on our proposal. The city is a partner in this project. Please stand up for our city and ask the bridge district for the refinements that we recommend. Thank you so much.

Hey, good evening, City Council and Mayor Kate. Aaron Burnett. I am the Director of Policy and Civic Engagement at Canal Alliance. And I want to speak to the BMR part of the conversation and also just the general affordability, inclusionary. RATE. I WAS NOT IN MY ROLE IN 2021 I WAS NOT IN MY ROLE IN 2021 WHEN THE CITY DECIDED TO LOWER WHEN THE CITY DECIDED TO LOWER THE INCLUSIONARY TO 10% BUT I DO THE INCLUSIONARY TO 10% BUT I DO KNOW THAT MY BOSS WAS ON BOARD KNOW THAT MY BOSS WAS ON BOARD WITH THAT BECAUSE WE AGREED WITH WITH THAT BECAUSE WE AGREED WITH THE PREMISE THAT COUNCIL MEMBER THE PREMISE THAT COUNCIL MEMBER HILL BROUGHT FORWARD THAT 0% OF OR I GOT THAT BACKWARDS. 100% OF ZERO IS ZERO, RIGHT? SO IT SEEMS LIKE INDEED THAT MAY HAVE HAD A SHIFT AND WE ARE NOW SEEING CONSTRUCTION CRANES AS A RESULT. AND SO WHEN WE TALK ABOUT LIKE THE LEAVERS THAT ARE AT OUR POTENTIALLY HAVE AN IMPACT ON DEVELOPMENT I WOULD JUST HOPE DEVELOPMENT I WOULD JUST HOPE THAT WE REALLY THINK HARD ABOUT THAT WE REALLY THINK HARD ABOUT WHAT WE'RE DOING BECAUSE THAT WHAT WE'RE DOING BECAUSE THAT DECISION TO LOWER THE DECISION TO LOWER THE INCLUSIONARY RATE WAS NOT INCLUSIONARY RATE WAS NOT NECESSARILY DONE IN FEAR OF WHAT NECESSARILY DONE IN FEAR OF WHAT HCD MIGHT DO. HCD MIGHT DO. I THINK IT WAS DONE BECAUSE OF I THINK IT WAS DONE BECAUSE OF THE COMMUNITY AND THE COMMUNITY'S THE COMMUNITY AND THE COMMUNITY'S DESIRE TO ACTUALLY MEET OUR DESIRE TO ACTUALLY MEET OUR BURDEN OF HAVING HOUSING FOR THE BURDEN OF HAVING HOUSING FOR THE FOLKS BMR conversation, I am happily employed and am, I guess, happily considering myself low income under that. And so for the clients we serve, I think looking at the affordability of 50% is something to look at. But again, looking back to the levers, you don't want to let perfection get in the way of progress when it comes to housing. Thanks.

Thank you. Hold on one second.

Good evening, council members and staff. Tom Monahan, just have a couple quick comments. I think on the first point, should we tinker with the downtown housing element and consider making some modifications to that system? I would say no. I would say kind of leave it alone. I would point out that that was adopted in 2021, goes for 10 years. 2031, we're kind of at a halfway point. We're finally understanding how that system works. And so I would counsel the council to say, let's kind of stick with that status quo. I don't see that being productive. With regard to the BMR considerations, Lowering it to 10% I think was a very good move. I think that's helping we're seeing a lot of projects come through that have a fair number of Affordable units in them. We'd love to see more of those get built I also would point out that Mostly what we talked about tonight is mixed income units where you've got market rate units and affordable units together in the same project there are also a number of specifically 100% affordable projects which are starting to come through now which are providing quite a number of affordable units just on their own. So I guess my recommendation would be if we're going to do anything about that, I would recommend we see a little bit more progress being made with projects actually coming online and those homes being created. You know, somebody pointed out, I think Council Member Hill pointed out some of the headwinds that we have in terms of higher labor costs, higher inflation, cost of housing, you know, cost of borrowing, all of those things are difficult. We're also coming out of a really unusual COVID experience, right? We passed this housing element in 21. We're in the middle of a COVID crisis. We're finally getting out of that. And so I would just counsel, steady as she goes, let's keep moving with what we're doing and see if we can produce more housing. I think that'll benefit the city in the long run. Thank you.

Thank you. Any other input? Come on down. Be shy.

MATT, VERY APPRECIATIVE OF YOU PURSUING THIS CHALLENGE, ROCK AND HARD PLACE BETWEEN WANTING TO PROVIDE MORE HOUSING AND NOT BEING ABLE TO UTILIZE THE DESIGN STANDARDS THAT WERE IN OUR GENERAL PLAN TO MAKE THE KIND OF DOWNTOWN THAT WE ALL AT THAT TIME WANTED TO SEE. My curiosity here is what is the appetite at the state level to address this issue where we are far beyond what we thought we would do or we would have in our downtowns. This gubernatorial race, the impact, the effects, the discussion of vertical density seems to be something that the state is gung-ho for and wanting to proceed on. Does the city have any conversations with our state representatives where some of these discussions about changing our housing element or changing some of the BMR requirements are simply asking is there another way we can go? Out of the box thinking beyond using planning solutions have they been thought about? Some of the out of the box solutions may be seen as anti-housing. but it might provide us with the ability to gain some time to see where we can get to the point of getting back to what we thought we would have and still provide the housing that we need. So I'm curious if you've had that conversation with the state to see if we embark on any one of these avenues, will we find some acceptance at the state level? Thank you.

Thank you. Anyone else?

Chris Hart, nice to see you all. I wish I was more prepared and had my thoughts down, but I've brought to you all in our city 435 units. 192 of those are 100% affordable, 30% AMI going up. One point of clarification, the crane is not swinging or flying around, it's just swinging and moving. But if that was a 12% BMR, that deal would have never happened. costs are higher.

I redid that deal three times to get it to go.

I think that we really are in a stage here of entitle and sell. I think if you don't want state density bonus, maybe we wouldn't be here if we didn't have 17-story and 24-story proposals, which I'll put my bet over here strongly that they do not pencil out and will not go. But I think if you don't want the height in cent, make Lou give us the approvals immediately and get all of our permits built and done right away. That'd be super helpful. I don't think that there's an issue with HCD. I think that in all reality, all the jurisdictions I deal with, staff, your policy is fantastic. I don't see that coming from HCD. So I don't think there's any teeth there at all. Moving on the housing element, my interpretation, There are some avenues in which to litigate. If that were open, I would stay away from it. I've already explored that with outside people to look at that. So I just would stay away from that. I think that we're flying an airplane. And when you fly an airplane, you're going long distances, you make lots of little tiny adjustments versus big huge moves. You're not turning the plane 30 degrees. You're making little tiny adjustments along the way so you're as efficient as you can be. There's a question right now of can we absorb all the units that are planned, all the units that are maybe going to be built. I don't know if I want to take down any more properties to try to do this. But I know we need housing. I know we need a full scope of housing out there. So I wish you well. You're stuck between a rock and a hard spot. But I think you guys are doing a really good job. Small incremental moves is probably the way to get this going. All right. Thank you.

Thank you. Any other comments before I close the public comment? Okay, I don't see any other comments. I'm going to close the public comment. We had great input that we just heard, but there was one very specific question about appetite at the state level. I know you talked about the evolution of state laws, but maybe if you have any insight, I'm pretty hard on the week of the election, but I'm curious if... you have any insight to that. And I know that all of us up here talk to our state representatives all the time, but beyond those casual conversations, I think is what we're curious about.

League of Cities just released a report, I just saw it on LinkedIn today, and they're quoting Gavin Newsom saying we have a housing crisis and we still need to build rapidly. So that's my only data point I can point to right now. Obviously, elections have consequences, but that's what we can hear in the current climate.

Thank you. I know I have another question, but let me see if there are other questions before we get to commentary. Actually, I'll ask my question by my colleague, see if there's any other ones. So I was curious, this has to do with the density downtown, and one of the members of the public talked about the form-based code, and we actually didn't talk about, I'm curious how the form-based code is intersecting with the density standards, and if that's the case, Maybe that would be part of a study. Maybe that's the answer. But I am curious, because we are unusual from other cities and towns because we have a form-based code.

Yes, so without getting so deep in the weeds, because it's painful, the short of it is that there's a calculation that we do when we figure out the bonus project, right? So that starts with the base project, and when you're doing it in the rest of our city that has seen some growth, we start with the density cap. So you could have 30 units per acre in your base project. when we're doing it in the downtown, that mathematical component's not there. So does that?

So the question, I guess, would be would reexamining or revisiting the form-based code be one of the things that we would be talking about? Just for exactly the reason you just said.

So if we were to reintroduce density, that would impact how we calculate base projects in the downtown.

Okay. So does that, in effect, go away from the form-based code then, really? If we were to decide that we're gonna explore density, then the form-based code won't apply.

It would, in large part. So all the development standards about the articulation of the facades and all of that, it's that one mathematical calculation that would play differently. Okay, okay.

Let me see if there are other questions that came out. Yeah, Vice Mayor, go ahead.

I'd just like to go back to the very beginning when you talked about the research, that we have the RFPs, we got the proposals. What would be the benefit of moving forward with that? I'm still unclear, and I'm a data person, and I'm a metrics person. I think I'd like to see some of it, but I'm not sure what we'd be using it for.

I can start with that, and then I bet there's other people in this room that have other ideas, additional thoughts. If there's, so it's an experiment, right? If reintroducing density is going to have some impact on, to Mr. Hart's point, the 17-story, 24-story type projects we're seeing that came in, which were never envisioned in our precise plan, right? If we were to do that step one, and we find that we can do this without changing our housing element, without, so no... of the consequences that we would like not to even begin to discuss, right? Then we would be able to talk about it in like, okay, we can make these findings and we can do this and we can see if that will have any impact on height. And there is some question on all sides if it would. But say it does, we would maybe have an impact on some of these super high rises that we're seeing. if we do that calculation and we realize we have to open the housing element and it starts to become a little complicated and we'll know what the gap is. Do we need to come up with 100 units? We need to come up with, 100, that's not the number, right? So what's the magnitude would be the better way of saying that. That's gonna start to talk about how long it might take. Is it feasible at all? What are the consequences? But I think speaking as the planning manager, I would like to know if we have to open up the housing element.

Thank you. Thank you. Any additional questions? Yeah, Council Member Iranskalade. No questions. No questions, okay. Any additional questions down here? Okay, so we have prompts. So I have on my computer slide 42. Let's bifurcate this, so let's first talk about question number one, which is around the downtown density requirements. So I want to give input on that and then we'll come back and do the affordable just to keep it really clear so we don't meander in our comments. So we'll go ahead and start. So go ahead, provide some input, Vice Mayor, go ahead. And then you have the questions right in front of us. Okay.

I don't, from my perspective, I don't feel like we're in a position that we need to open up the housing element. I'll just start with that. It's so interesting being in San Rafael and Marin County. and then working and dealing with people across California at some of the CalCities conferences and meetings, we are such a small fish. It is just really interesting to hear from others' perspective, because we come from thinking San Rafael is California, and it's really not in a lot of cases. So I'm concerned that, doing more research, more metrics, housing element. It's not addressing what some in our community are raising as a concern. I feel like it's a distraction from the work that we need to do, which is to get some housing completed and move that forward. So I wouldn't support changing, if it means to change the downtown density and would require opening up the housing element, I wouldn't support that.

Okay, thank you. Council Member Micah.

Yeah, so I think opening the housing element it would just take a lot of time and a lot of resources. To me, if we can choose the pathway A, where we can look at the downtown density limits without amending the housing element, I'm definitely interested to look at some options around the density bonus and everything that's happening, whether it's the height limits or affordability or whatever it is, but so my answer is no about the housing element amendments, but yes to downtown density limits review.

Thank you. Council Member Boushey, go ahead.

My answer to number one is yes. We should explore and study density limits that could potentially be used in a convenient and feasible way to achieve our height limitations. I would not go, so basically option A. Option B, which would require reopening the housing element, If that is required, then I would not support that step. But if we can do this conveniently, we should.

Thank you. Council Member Hill.

I concur with Council Member Bushy. We should go step one and look. Thank you.

Thank you. And I also agree. The landscape has changed from when we created these initial policies around density, and I think it's prudent to go ahead and look at step A, and I also concur with what everyone else said. Opening up the housing element, we will see what we learn from path A, but I think that makes sense. And I was scrolling through to see, were we supposed to talk about a work plan part of it? We'll just keep going and then we can. Hold on one second. There was something about, did you want us to say, so I guess what you're hearing, we recognize, maybe it's saying we recognize that that might have implications on the work plan. I think you just want us to know that we know that. Okay. Council Member Hill, you had one other part you wanted to add?

Yes, and it is related, and I appreciated a comment from one of our community members that perhaps come February, there might be a different opinion that could come from HCD, so maybe we can get that clarification inquired in that time frame, if that might make sense. Thank you.

Okay, thank you. So now going to, are we, okay, I don't know, City Manager, Director Hinkle, are we clear on that one? Do you have the input you needed?

Clear on that one. Okay.

We'll go to the next.

Yes.

Okay. May I ask a clarifying question? Of course. So I was saying no, but I was saying yes to pathway A. So I just wanted to make sure.

That was what the- Okay. Great. Thank you. You're welcome. You're welcome. So the input that has been given to staff from the council is to inquire to look at what amendments might be feasible around the downtown density.

Madam Mayor, if I could just say it back. So proceed with step one. So you are asking to us to explore the amendments. Proceed with step one, gather the data, and that will tell us which pathways we would have to consider. And at that point, we would come to either the council or the subcommittee and report back. But it sounds like there is very little interest in if we have to, if it's pathway B.

And we always defer to staff. I do think the subcommittees are there for a reason because it's a first pass to ask questions and have the public weigh in. So I would... I defer to that step when we get there.

Okay, Mary Kate just for just Understanding the work plan implications. Yes, we will be spending some resources to bring on consultant to actually support that data collection I will say though it's valuable data set regardless and it's information We're almost pre loading our next housing cycle update. So we're gonna need this data at one point or another So we're just doing a little early

That's an excellent point. And we know from some of the hearings we recently had and some of the discussions around housing that also the community is interested in this. So I just want to be clear, even though the five of us have weighed in, We have heard plenty of public comment. So I think it does make sense in terms of the work plan allocation and resources Okay Now we get to that. I'm gonna say easy one first. None of this is easy, but this one is very dense Sorry had to do the pun. So on this one there are two questions And you all can read them up there and if you could provide input on them and the five of us will go ahead So I started you want to start off? Sure. Okay

For me, it's really straightforward. But historically, before I was part of how the sausage gets made, I was 20%, 25% BMR. I was all in. And at 10%, we're still not seeing And so I would be really uncomfortable changing that at this point. We can revisit this at any point in time, but I would not even entertain the discussion until we have some housing. Short enough?

So was that, that was in response to question three or both questions?

Yeah. The inclusionary percentage, I mean, I sort of see the two tied together. I mean, I think it's a priority. And I mean, it's already built in, right? We have that already built in. I guess I'm not clear on the question.

Okay, it sounds like you do not want to amend any of the three components of the inclusionary policy. Is that correct? Correct. Okay.

Thank you. Thank you for going first. And Council Member Micah.

Yes, thank you. So... So again, when I'm thinking about what we are looking at right now with the low income, moderate income, and the very low income, as a low income, which is our minimum, that's over $104,000 a year. Moderate income is $156,000. This is for one person only. I think when we were looking into lowering the percentage, it was before the state density bonus. I'm not sure how much it has had impact once the state density bonus came into place. So I think I would like to see a revision and what I'm hearing from the presentation is that at 15% versus 10% we'll still be okay not having to modify our housing element. So I would be interested to look into 15%.

We wouldn't need a feasibility study.

I thought it was over 15%. You need a feasibility study.

No, we can go up to 15% without a study. Right.

Okay. So that's the part that I'm looking at. And so, and it's just like, again, we need more housing, right? But when I think about we need more housing, it's like we need more really affordable housing, like very low income. So I think when we are talking about the state density bonus, increasing a little bit that minimum for like a low income, which is not very low income, it's only low income. I think it will be helpful and whatever we can do It's complicated, sorry. Because it's a balance, right? We really want more housing. We really want more housing like very low income so people can live here. Not only the people that they make over $100,000 can live here. And with the state density bonus, you know, bringing like, oh, we are going to bring more low income, so we are going to go 17 floors or 20 floors, especially on developments where they are unsafe to be in the first place. So... I think your question is very specific about the below market rate, so I'm giving you the 15%, but I would really love to see more on reducing our height limit, so when they apply the state density bonus, they don't go as high. I know that's not part of your question, but I kind of wanted to see that. And the other one is like bring more community benefits when we have developments and incentives for non-profit developers that they are truly bringing very low-income and low-income housing or whatever is a partnership, because I know the developers also have to make their money. That would be, I think that would be my opinion. And I did talk to the director of California Department of Housing and Community Development, Gustavo Velasquez, at the Civic World Conference. It was about the environment. And I did bring the development that we have at the moment for like 17 floors and in a place that is not safe because sea level rise and everything that's happening.

Let's not talk about specific projects. So keep it.

All right. Well, let's just make like maybe two, yeah, projects that don't make sense for our city. I will say which ones, which I already did. But he was interested to look at each case as well. So I feel that sometimes when we are talking to the state, is not black and white. I'm very happy that you're working with the staff because I think we shouldn't just vote on something automatically yes for the fear of being sued. I think there is a reasonable amount of... Yeah, I don't know. Like different things that we have to look at when we are approving projects. So does that help?

Yes. And I understood your comments related to question three. And I apologize because I think maybe I could have written these a little bit better. No, it's OK. So I just want to, I do really need the council's feedback on question two. And question two is asking about the comparability and those requirements around development standards. So if you have any, if I need to clarify, please let me know.

We'll keep going. Okay. Let's keep going because there are three more of us up here. And if you still don't have clarity, then we'll go around again. Okay. Council Member Hill, go ahead. Oh, I'm sorry. Council Member Micah, were you done? Yes. Okay. Council Member Hill.

Well, I'm going to do the easy one first. As to question three, I think we should not evaluate changes. We should stay where we are. As to number two, and I know two, I had to go back to the deck that I have a copy, and it shows in the notes all the different dimensions, so it's a quick reference here. As worded, I don't think I should, from the dais, just say, change this, change that. I would prefer that the question read, should we explore these areas? And I think the answer is yes, I would like to see that. As my question during the item came up, I would like us especially with respect to the concessions, understand how to be more granular about what that would mean for different concessions. I would prefer that we not, one thing I can say from the data is I would prefer that we would not allow for stacking, because that could result in some very poor outcomes for equity, among other things. But I would like to see question two examined. Thank you.

Thank you. Council Member Bushy.

Question two, first I should ask a question. Is ADUs considered a development standard or is that part of the inclusionary percentage?

I would consider that a development standard.

Okay, then I will include that in my response to question two. And I'm going to back up for a minute to let us all recall the purpose of those development standards are to have these units blend in with all of the other units in the development so that there's no ability to identify what units are the below market rate units. Our goal is to include all of the people and all that are in these units into the community in an unidentifiable way. To the extent that the concessions undermine that policy goal, those concessions should be reviewed and we should find a way to achieve that. That doesn't mean that they have to be exact. If it's a 900 square foot unit versus a 950 square foot unit, but you can't tell from the doorway, that's an immaterial difference. So that is why it's very important to me that we continue to achieve the objectives of the development standards. Under that policy goal, accessory dwelling units do not achieve that goal because they are something different than the other units and they are optional. They may or may not be part of the of the rental facility. So I think that ADUs, we didn't really think that through maybe when we adopted those development standards. So I think they should be excluded from the calculations. Moving on to question three, I believe the current inclusionary housing requirements are performing as intended, and there's no need to go further in reviewing them. When we adopted them, we envisioned that as a first step. I think the cranes and the development proposals that we've received are concrete feedback that we've achieved our objective there, and there's no need for further steps. Thank you.

Thank you. Everything Council Member Bushy said on question number two, very, very well said. I don't know if I totally agree on the ADU, JDU. I do agree that they're a little bit of a different animal, but they have, when you look at our arena numbers, they have supported that, whether it's in, if it's manifesting on the street as real affordable units or not, so that might be another piece. I also agree with what Council Member Hill was saying about not stacking those because it ends up becoming a different animal. And someone had mentioned, too, about long-term upkeep of those units if you have substantially inferior materials. And I thought that was a really, really good point, because you could have a lot going on. So I'm not going to add anything else on question two. And on question three. It's always interesting being able to hear everyone else speak because what I have been taken with was the nuance of other jurisdictions. Our inclusionary affordability is pretty straightforward. And I'm curious, when you look at Nevada or some of these other ones, 10% to 20%, depending on different size, So I personally would be interested in exploring that. I don't hear that appetite from the rest of the council. And what I'm hearing so far is to stay the course at 10%. But I think we are in such a different landscape. And there's no apples to apples. So to me, if we're going to be looking at this, we're looking at the number two. I do think we should be looking at number three, because they're tied together. So for me to say we're sticking with 10%, but we're looking at these others, I think that's maybe unnecessarily putting one hand behind our back. And that one way to do it would be to have the nuance. I wouldn't, I mean, the 20%, I mean, we're out of, we're different than all these other comp, and you only had four of them, but still. But the point being, so I have curiosity about that. So that's what I'm grappling with, but...

Add to that conversation. Go ahead, Vice Mayor. Along those lines, I'd be interested in understanding, and I'm sorry I botched the two and three, the whole thing. it does sound like it's project specific and I'm curious in these other jurisdictions if there's more of a back and forth and a collaboration and that's why there's ranges and that's why there's not specifics. Um, and I'm wondering if their process of, you know, where, where's their process of planning commission, where's their process of evaluation and timelines and how does that actually come to be? Maybe we're trying to be so rigid in our, and I get it, it's hard not to be, we have to be very defined, but I think there's possibility we may discover that in some of these other locations, and what I have heard in some down in Southern California, There is much more back and forth in terms of that. And so maybe that's where that range and that flexibility. Personally, I know that my son is in a below market apartment in New York. And it is clear. And when I asked him, is every apartment like this? And he's like, absolutely not. And he's really happy to have an apartment. And so I think that's where it comes down to also having that conversation that when we talk about a concession of an actual unit, what are we really talking about and what is the long term implication and are we giving up a unit of housing versus to make sure the finishes are the same. I want to make sure that, again, that's probably more of a conversation between staff and between planning and between the developer to understand. But I want to be careful around being very, very rigid on some of these.

Thank you. Hold on one second, because I just wanted to finish. So the other part about the inclusionary and affordability Again, in your comps, you had ownership and rental. And again, there's just more nuances in the other policies. So I feel for us to say we're not gonna explore that, that again, we might be missing an opportunity. I would want to know, is that something that we should be exploring? I don't have that information. I don't think staff does either. So for me to wait another five years to find out when we're at this point right now, we're talking about taking a look at it. Anyway, that was the other part I wanted to add. So yeah, Council Member Micah.

Yes, I completely agree with the mayor about the third question on evaluating also not only the percentage but also rental versus ownership, you know, and where we are in terms of other, you know, towns and where we are actually. But I wanted to, so on the second question, when we are thinking about, for instance, like the height of the buildings, right now we have eight floors, right? So are you asking to amend the development standards that will include height limits or is that part of the first question?

So I didn't consider height at all tonight. Margaret did in her presentation. I'm specifically looking at development standards for the affordable inclusionary units.

Okay. All right. Other comments? Councilmember Hill.

I think in light of the Mayor's comments, I'm persuaded that we would want to examine that nuance, but maybe my question would be to Director Hinkle. Would this be something we might have contemplated anyway in the next several years, or we would not be looking at it otherwise?

I think we'd be looking at it, real question is priority of tasks. That really kind of speaks back to the work program and capacity. I think it is a valuable exercise to understand what these pieces are, but kind of the point about objective standards that's how we're guided to this in terms of the state mandates us is that's why the negotiation back between the developers what this means the biggest thing for me is clarity clarity what this is specifically what the council asked for these are the five things we need to to demonstrate Our current regulations, it's up to kind of that discussion. So that's where we've struggled trying to reflect that back to council about what we really need. We need clarity about do you want the parity of, do you want them the same? Do you want the adjustment? So that's really what I think we're looking for tonight on this specific question.

But I think, sorry to jump in, but I think on that one, we've given very clear around number two, I think, about parity. So I think that you have had very clear

Yes. Okay. Yeah, that is helpful, but then adding, so the question is, do you want three also? Sounds like it's heading in that direction.

Yeah, I think in the same breath, I want to say I'm pretty, I have conviction that we should not mess with the blend that we have, but as I think the mayor articulated well, that there are, there's a lot under the surface there that deserves exploration, and I want to make certain that we're sending the right consistency signals to our developer community that I don't intend the examination of it to result in a hard turn of the wheel, as I think was put. I do want to make certain that we have available to us what those options are and what the benefits and drawbacks of those options would be.

Council Member Bushy, go ahead.

Well, and I would phrase it more as a monitoring function. You've indicated that there are various inclusionary standards in different jurisdictions, our neighbors and around us, and we should be monitoring those to see how that's turning out. If something different is working much better, then maybe we should monitor be looking at it in an orderly way. So it's not that go out there and find something better. It's monitor these things as they develop, monitor ours as it develops, and bring us in your professional judgment when you think something has changed and maybe there's a better option out there for us, bring it to us so that we can consider it.

And I would, if I could add, yes, and I think, I'm not sure this is the right time. And so I think I'd like staff to come back and say, you know, there's been enough change or enough time, now would be the time that we would initiate wanting to re-evaluate or re-study or do something. If it's a trade-off between what's the impact to the work plan, I'd like to go back, I know that we went through that very quickly, of what we would have to take off. And if we are asking an evaluation, does that impact the work plan? And if so, what are we trading out? And I'm not sure I'm ready to trade out yet.

And I think you're not getting as much clarity around this. Maybe you could help define for the council if you've heard very clear direction on number two. And again, the point that I was trying to make is if you're looking at number two, you're saying, I'm not going to look at anything over here. Because they're packaged, that's what I'm struggling with. I mean, you bifurcated the question. But to me, as you're looking at it, all the examples you've given us are their own unique packages. And so that's what I'm struggling with, to sit here today and say, oh, we're going to stick at 10%. We're not going to look at rental and ownership. We're not going to look at AMI. I just... I wonder if we are not taking advantage of this opportunity when you've already heard clearly we want you to look at two. So maybe the incremental delta of capacity and work plan now would be the time versus taking it up. Or maybe there's just a small piece.

Yeah, I think you're accurate in this in that it's a challenge because really we're talking about concessions. In essence, the affordability gives you more concessions. So I do think we have enough to kind of value those pieces on the amount of concessions based on affordability. So I think that's something to kind of look at is concession eligibility because that really goes to the level of affordability and number of units. But I know Lexis has that look.

Yeah, Lexis.

I just want to mention, I think Council Member Bushey, you said staff should identify when there are opportunities or policies that need updating. And I think part of the reason why these are bifurcated is because question two is an area where we said the landscape under this has really changed. And so that's part of why that's bifurcated to kind of highlight This is not what it was necessarily in 2021 because how the environments changed. And so, yes, it's all under the same policy. I think we just wanted to... in the list of priorities, they could be bifurcated if you so desired.

So I think, and I'm glad you said priorities. So what I'm hearing is you had very clear on number two, because the landscape has changed, as you just said, and in that work, I'm also assuming we will get more information that might lend us to additional conversation about three, but there's no, you know, go and change that right now. I am still interested. We're the only one that doesn't have rental and ownership. So again, that maybe not a whole new program, but something to possibly consider in the future. And then having, knowing that when staff is working through this and you come back with more information or suggestions on two, that might be a time that we revisit this conversation and say, Oh, Okay, well, we're at 10%, but we do want to become more nuanced at 20 units plus for this percentage. So maybe that might be a path forward. City Manager, yes? Yeah, Council Member Maikai.

So, you know, for the second question, I remember that you came to Council asking that question, and then you're coming back right now. So I guess I just want to make sure that the staff that you have what you need when you have developments. Because I remember on the presentation you did, there was no clarity. And it was opening up to some confusion with the developers. Am I right, or am I going in the right direction? And I think that's why you're coming today with a second question. So I want to make sure you have what you need when there is a developer coming.

Well, to answer their question, I think we're coming back to confirm this is something that we are working on actively because there are various housing policy questions that come up through various discussions and different, maybe project-driven or work plan programming, and it's like, we were kind of delayed like the inclusionary percentage question that was actually targeted almost a year ago and we haven't gotten very far on it. Like, do you still want us to do that or is there something else that's higher priority? We've called out number two because this is one that kind of to Vice Mayor Kurtz's point, we have active negotiations with developers on those specific items about what is and what is not. So we were looking for trying to clarify a little bit more. And I do think that the direction we got tonight actually gives us better direction on where to work towards and what the council is looking for in terms of parity of unit types. So I think that I've taken that as positive feedback for us to develop something to bring back to the council.

Okay. Okay, great. The only other thing that I wanted to add, just tying a bow on this, going back to the very first part of the slides and referring back to our February 2nd housing study session. So just to call out for the council, we did talk about having a ministerial process. I think because of what you have found, I don't think you're hearing that desire to go forward on that. We were all hopeful that that if you had that process, we'd get a certain type of project. But thanks to you coming back or going and looking at that and coming back. So that is something that we are not be pursuing at this time. I just want to have clarity, making sure the council understands that because that's different from what had come out of the February 2nd.

I don't think, I'm not sure we actually really covered and discussed that. How do you, maybe it's a question for Alexis. How do you feel that we would not go through a ministerial process. Maybe it's not my misunderstanding.

So the process that Mayor Cade is referring to was is there another, an alternate route we can take to incentivize what we would like to see in the city, things that were described more in the precise plan that would not, instead of the state density bonus path that seems to be happening. And that's what we have found is in the cities that are seeing growth that have some comparative characteristics to San Rafael, no one's using the other version. And we have one of those in our precise plan too and no one's using that either.

Okay, I just wanted to confirm, thank you.

Okay, any other comments from staff? Yes, Assistant City Manager, or Assistant Director Minor.

Yeah, maybe just to circle back. Please. Sort of build on what Micah mentioned. I think we've got clarity through this process of the two study sessions on these specific questions, so I just want to appreciate the public and the Council for helping us clarify what to work on and what adjustments to make going forward.

Fantastic. Well, not seeing any other discussion or comments. Thank you all for coming and participating in the study session, and the study session is now adjourned.