Planning Commission - Regular Meeting

to the August 20th, 2026 Planning Commission hearing. I'll call the hearing to order at 1 p.m. Ms. Carman, can we please have a roll call?

Thank you. We'll get started with preliminary matters. The first topic on our agenda today is the request for continuances, withdrawals, postponements, or ex-agenda items. Ms. Arciniega, do we have any? Thank you, Chair Voss. We do not. Okay. And any announcements or appeals?

That takes us to item C, comments from members of the public pertaining to items that are not on today's agenda. Ms. Carman, do we have anyone in person or remote who would like to give public comment on items not on today's agenda?

All right, thank you. We will move to our new item, inclusionary housing ordinance amendments. The purpose of this hearing is to review and provide recommendations on the proposed amendments. And this project implements housing element program HE13 to update the inclusionary housing requirements for ownership and rental residential development. So we have staff here to provide a presentation. Ms. Falk, the floor is yours.

Yes. Because this is a very helpful slide, and I think we all want to just read it. Yes. I'll look to others to nod when we're ready. What did you say? Just a moment to pause just to make sure that we've read it.

Next slide. No, I think you'll have questions later. Oh, I will. Don't worry, I'm ready.

Thank you. That was the most rapid presentation ever. So when we get to the questions, I think we're going to ask you to repeat a few things while we absorb it. But thank you. A lot of information to unpack there. So for now, that takes us to comments from members of the public pertaining to this specific item. Ms. Carman, I think we have a couple folks in person or remote who would like to give public comment.

Thank you. I'll now open it up for commissioner questions, and then after we'll move to comments. No one has any more questions.

I'll begin with Commissioner Wardlow. Thank you. And thank you, staff. I'm going to start just with G2, and I think I'm going to have more questions. I really appreciate that presentation and for taking the time to meet with us. I think there's been, you know, I think all of us have had a lot of questions about this process, and I appreciate the additional work that you've done on it. So I want to focus on G2 first, and then I'll let my colleagues speak, and then maybe I'll come back, depending on how the conversation goes. So I know that this commission had recommended the highest legally def

Okay. And I just wanted to make sure I was understanding that correctly. I don't think that we, or I'll speak for myself, I don't think that I understood that in the previous hearing, that what was being proposed. And I think, you know, I really appreciate you doing the work to put the calculation up with all the words so that we all understand exactly what and how this is being calculated. But I think, you know, we're, as represented in the hearing on Monday, I think we're all really focused on building housing. We want affordability. I am concerned that if we do not get buildings in general,

I appreciate that. I'll let some of my colleagues ask their questions, and then I'll come back. Okay. Commissioner Peterson.

Thank you. In the example that you used and the calculation that you put up, I'm curious, why do we include the entire project in the square footage calculation rather than just the square footage of, like, an example 4.3 units? Doesn't it make sense to charge an in-lieu fee in lieu of the units in terms of the area that we're calculating what they should pay out?

Sorry. Sorry. No, the $3 million one. I apologize. Sorry. I thought that was this one. I'll get there eventually. Sorry, guys.

Okay. I'm sure we'll talk more about that later. I think the only other question I have, and maybe I should have asked this one first, is if one of the goals, which certainly it should be, is to provide flexibility and incentives for developers to choose our program rather than State Density Bonus, how are we thinking about this in light of the potential building back, I'm sorry, building better housing initiative and creating an alternative pathway to that. How are we in conversation about these two things? To make it feasible, as it was mentioned earlier in public comment.

My thinking and my question is, isn't it important to think about how we're structuring this in light of these requirements being potentially in that and these things being in conversation with each other. We're potentially mending this, we're mending that. we're all in the kitchen here together, isn't it important to think about that?

Thank you, Madam Chair. I really appreciate the numbers that you gave us that show a little bit of what we're looking at. I remember when we first discussed, not when we first, but the last discussion we had. And I carried the flag of the Planning Commission to the City Council's discussion. And I have to say in all candor, I don't think they knew what was going on. I don't think they understood the nuances of it. And that isn't to their lack of ability to understand. But I don't think the presentation to them, nor this presentation right here to us when I'm finally starting to see it, gives u

You understand that this is a public presentation on television to the city of Santa Barbara. They're not seeing those numbers. And we're making decisions on the basis of number that no one is presenting to the city. And so the city is wondering, well, how is the planning commission making this decision? How are we doing that based on numbers that are hidden into a document that aren't presented either to us or to anyone else? I just don't think. The numbers are insufficient. I'm sorry, Madam Chair.

I'm just going to interrupt real quick because I want to make sure that we're on questions right now. Well, my question is, where are these numbers? OK. Where are the numbers? The tables were publicly posted as part of the meeting materials. They were.

Well, let's continue to talk about the highlights. Why isn't there a discussion about the multiplier effect of the housing authority and the in lieu fee going to that and that consequence of the in lieu fee concept? And why aren't we talking about the idea that the developers don't want government's hand in their project? And why aren't we talking about the value of the piece of real estate when it's all said and done, if it has an inclusionary unit in it, it's not 10 units, it's nine units plus an income stream. That's some strange thing that the owner is trying to offer on the open market fo

I think that was the discussion that we were having previously, but today we're asked to consider the amendments.

When this item was brought before the ordinance was revised, that would have been the time for any further discussion. Today we're considering ordinance amendments.

But I beg to differ. I'm here to make a comment on the staff presentation. By the way, don't misunderstand me. The work you guys did is fabulous. But I don't think we have... If this was presented to us the last time, in the way that I'm discussing it, the in lieu fee going to the Housing Authority with four to 10 multiplier effect, the developers not wanting government in their hand and 10 unit being turned into a nine unit. I don't remember any of that as part of the discussion of why or why not a developer would say yes to this. Those numbers are not here.

I thank you for that answer and you brought up my next question is in ownership units middle income people are included. Would you please tell me why middle income people aren't included in this discussion having to do with rental? Why isn't the category middle income and why have we limited it to moderate income?

But we hear from a gentleman who spoke here and we are constantly talking about the missing middle. and we're still missing it by being below it. And if we included middle income as part of this project that we're doing right here, we would be hitting that middle, the missing middle, wouldn't we or not? Am I misunderstanding?

Wait a minute. They were able to, what units are they?

Okay, thank you. Madam Chair, I think I'll wait until my comments come around. Thank you. I really appreciate the answer.

Thank you. And I'll go back to Commissioner Peterson.

I have kind of a follow-up on what Commissioner Barnwell said and maybe trying to pull together some things here. I think maybe a good question that comes out of the points that you raised is, Has there been any thinking, have we done anything about what the key number is, the sweet spot number is that would incentivize someone to use our local program, as an in lieu fee, to use our local program rather than state density bonus or not building at all? Has there been any thought about where is that sweet spot in terms of incentivization while also reaping benefits for our local housing trust fu

Thank you. I'm going to go to Vice Chair DiLuccio.

We should take a break after that. OK. So just to clarify a couple of things. For inclusionary housing here, when we're talking about rentals, we're talking about moderate, correct? And when we're talking about ownership, we're talking about middle. And is middle considered? market rate as far as counting toward the arena number?

So there's an above moderate category in the arena?

What are the categories in the arena? Is it low and then it's very low and it's moderate and above moderate. Gotcha. So it's counted toward above moderate. So above moderate is really almost market rate housing sometimes. It's not really, we're not providing really affordable housing at that point in a sense.

Okay, thank you. I thought I knew that. Okay, also a couple of other questions. For adaptive reuse, just to clarify something, one of the speakers spoke that was not a, there was an inclusionary housing component that there actually is, right? Isn't it after 49 units?

So it's quite an incentive, but there is an inclusionary housing component after 40. Correct. Which probably the Nordstrom's project would probably qualify for that. Correct. Can we look at... Talk about fractions for a moment. When we're talking about fractions, we're saying now for fractions... you can pay into the housing fund for that instead of providing on-site if it's over 0.5. If you have a 0.1 or 0.2, at that point, any fraction would be paying into the inclusion housing fee.

So the entire spectrum from 0.1 to 0.9 would be... All tractions, correct, yeah. And then the other question, I thought this was a silly question, but I'm going to ask it anyway because I got really confused. This conversation is kind of confusing sometimes. But if you use a state bonus density... Can you have to then you provide so many units on-site with that affordable units? Can you pay the in lieu fee instead of building the units on-site? Or you have to build the units in that case on-site?

Right, so we're not talking about the in lieu fee for that component. Okay. Can we look at slide 22? Okay, slide 22, I see here The in lieu fee, this is a new one for lot only subdivision of $760,000. Can you explain that to me? You actually wouldn't be paying $760,000, would you? That's a lot of money.

You knew I was going to ask you this question, right?

So if it's 2 to 9, it's below the 760, but if you have 10 lots, it's probably above the 760. Oh, it goes to 15 to 5 to make it below the 760.

I'll ask one more question. The fee out. The $3 million from the analysis. Was that based on how many units was that based on?

If they have to pay $3 million in new fees, how many units is that We'll calculate it on. Okay, gotcha. So that was a project with 43 units.

And then you used, even though council went with a lower number, they would have gone with $50. You were using seven, for ownish rentals, you were using 91, right? I was curious. I mean, if that was, if you used 50, then it probably would have been a million five or something, half that. Approximately.

I mean, under this scenario, now that we're seeing these numbers for the fee out, would you even recommend it?

Do you think developers would go for that?

Well, those are my questions for now. Thank you, and you did a great job on this. I want you to know that. It's very, very thorough.

Thank you, Commissioner Whitcomb. Thank you, Madam Chair. I guess I'm a little bit confused by Mr. Lewis's comments because in all the years I've been on this commission, all I've heard from developers is give us a reason or give us a system that allows us to deposit money and not build the units because we have to we're not in the affordable housing business and we don't want to spend the time doing that. I, am I missing something? Because that's, I think that's been a catalyst to get to this point of, of actually giving developers an option.

Yeah, and I think when the $91, I know it seemed high to people, a lot of people, but When we've talked about this in the past, we've talked about what it costs to build a unit. And my recollection is it's around $800,000 to build a unit. And this is $738,000 per unit. So it seems like it's reasonable to me if you don't want to have the record keeping of the deed restricted units.

You're also getting the benefit, as the developer, getting the benefit of not having to. Correct. there is no relationship with the government that's required for the unit. So for 90 years or whatever. So, okay. Um, I'm going to move on. I want to go to net livable area and I want to ask you a question and you tell me if I'm right or wrong, because I still don't know what net livable area is. If you have a project and the average unit size is, let's say a thousand square feet. Okay. And, um, you have 10 units. Is it 10 times 1,000? Yes. Okay, so that's the simple calculation. It's the average

So you could play it both ways logically, yes. But you, whether you use AUD or not, you're going to have to calculate an average unit size to get to the net livable square feet.

Yeah. You have one that's 800 square feet and another that's 1,000 square feet, so that's 1,800 square feet and on and on. Okay. Yeah, that's fine. It takes out the one step. Correct. Yeah. Okay. Okay. So that's good. I'm glad to know that. I'm actually very relieved to know that. And you talk in the IN YOUR STAFF REPORT ABOUT AN OFFSET FEE. IS THAT THE SAME THING AS A FEE OUT?

So your presentation today called it fee out. but it's really offset fee. And could we make that consistent somewhere and have a definition of that so we know that, because that confused me a little bit. Is a fee out the same thing as the offset fee? I think it is.

So I'm paying a fee to offset. That sounds like planners.

Okay, which takes me to my next question. since some of us don't have planners speak, are we going to have a handout for this for applicants and developers and anyone that's interested that actually goes through these calculations, each one of them to... That is the intention, yes.

Because I think without it, heads are going to spin without it. So, okay. And then I just have one more question so far, and that is on page 25, you talk about a 10% increase for each year that payment is delayed. So that's, I guess, for each year the in lieu fee payment is delayed. So after they get their building permit, they have up to one year to pay the in lieu fee. Is that right?

It's more of a technical question, but I just want to make sure that we're not losing out on this.

So if you if you Now I'm even a little more confused. So if you, I understood that you, so are you saying you have to pay it at the time of the building permit, but you can opt to wait till C of O? Correct. But can you opt to wait a year or 11 months and 29 or 30 days? I mean, you have to pay it before C of O.

But, okay, if C of O comes 29, I'm sorry, if C of O comes 11 months and 29 days after the building permit, which is probably impossible in this town. If it did, you could pay it then and not pay the 10% increase.

It's the greater of the two. I just want the local housing trust fund to get the money ASAP.

Okay. And I think, yeah, that's all the questions I have for now. Thank you, Madam Chair.

really appreciate this conversation. It's very helpful. Um, so kind of switching gears to the, um, home ownership aspect. So in that, um, in that calculation, we're talking about 71, $72. Are we at all concerned that we are going to inadvertently incentivize condo buildings over rental units? Cause I do believe that like when we're talking about this, and I'm thinking about this really about the context of downtown, because I think we're all really aligning on how do we get housing downtown for a whole host of reasons. So what is staff's thoughts on like the, if we go with 91 on the rental for

Is it because rentals over time, especially where we are today as a city, continue to increase in revenue? Rents go up over time. Is that part of it? Maybe you don't know.

Um, and I also really appreciate commissioner Wiscombe's comments because yes, that was my understanding of why we were pursuing the fee out. I understand that most cities do not allow for a fee out, but I think that the trying to balance this of we want housing and we don't get any inclusionary units and we don't get any money if nobody builds anything. So how do we balance that? But I think, you know, the calculations that Wiscombe just mentioned, made me feel better in that if the cost is commiserate with the cost of construction, earlier you had said that the cost that we're talking about

So understanding our interest in really focusing housing downtown, have we contemplated, and I am kind of talking to Mr. Busk about this, lowering the inclusionary just for downtown to incentivize housing downtown. Like if we do 91 throughout the city but we lower the inclusionary in the CBD to 71 to really incentivize that we get some buildings. Because I am concerned that even if we do this that we're not materially changing the outcome and we're obviously all frustrated with the outcome that we have today. And so how do we balance this and understanding that kind of alignment is moving towa

So that will be figured out in that process. Now, the other concern, though, is how long is it going to take us to get that going? So, you know... I want to be cognizant of what we set here is what the rules will be now and faster versus what we get out of the Better Buildings Program, which I'm excited about that. But I also think that all of this has to be predicated on the work that we do on the lots, because that really seems where we're going to actually get the most affordability, and getting the funding for that is seeming to be contingent on us getting market rate buildings to then con

So I don't even know if this is possible, and I don't even know if I support it. I'm just throwing it out there for food for thought. Is there... Is there a possibility of us saying, look for the downtown core where we're all focused on getting housing and getting this going quickly, that we have the inclusionary set at 72 or 73 or whatever is commiserate with construction costs for that area, and then have it be the other for the broader? And again, I don't know that I actually support that. I just want to understand if it's even possible.

Because that's, you know, when we're looking at adaptive reuse, and I do really want to encourage that as much as possible, right? So that's why I think, you know, I understand why we landed where we did on the inclusion area around that. But if If we're also pursuing an entire process on the better building programs in general, we're recognizing the need for kind of all housing types. I just want to ensure that as we make these adjustments that we're going to get the outcomes that we want. And I'm nervous about the trade-offs here, because I do think it's really important that we get as much

And I do think that's a really important piece of this, the fact that we're now allowing density on top of it. That's something I definitely really support and appreciate staff work on that. Okay, I will let more colleagues weigh in. Thank you, though, for answering my questions. I'm gonna go to Commissioner Bauke next.

Thank you, Madam Chair. First off, thank you for your hard work. There's a lot here, and I think it's part of what we're dealing. This is a lot of information, and it's pretty complex, honestly. Could you pull up slide 14? Yeah, okay. And we had a conversation, a sidebar yesterday, and it goes back to my experience with in lieu affordable housing provisions and other communities. And what I found in our prior conversation, not yours and mine, but the one that the commission had is we, I think we're thinking the livable floor area was that of the inclusionary units. and that the math was all ba

CLOSER TO REALITY. GOOD LUCK TRYING TO BUILD SOMETHING EVEN FOR $91. THINKING ABOUT IT THAT WAY,

Okay. And then I'm going to go to slide 21, which you asked for some feedback on, which was, is that the right number or did I get it wrong?

I thought it was 21. Maybe I got it wrong. It was a question about... PHYSICALLY BUILDING THE UNITS ELSEWHERE, NOT WITHIN THE PROJECT, BUT OFF-SITE.

And my comment on that, especially when you get to the off-site, I would think we would want to at least harmonize ourself with state density bonus law, which has the quarter mile requirement. Yes. Unless you have some other reason to go beyond that, but I think that would be sort of the starting point is to start with that thought process.

And that leads me to actually my last question here was, has somebody done a comparative analysis of state density bonus as far as the economics of a project based on that versus what our NLU is? Yes, it's in the study. At this point, I mean, it was weeks ago we had that package in my brain. And it was more feasible to do state density bonus law. Probably flushed half of it, but okay.

Okay, one last one once you've triggered. If we're trying to get housing, I think that's the whole concept here. I'm trying to figure out a methodology in which would basically unlock the private sector. and basically go, okay, fine, we'll let you just go at it within our, you know, sort of what our vision for our community is. And that leads me back to something I've harped on as some kind of value capture thing, which is basically let them go do it, but suck most of that change of assessed valuation into the trust fund and then take that money and leverage it How much thought is, I know we'v

I think this is sort of a bigger level with the city manager's office.

You just heard one more thought sorry Which is oh, no, we have a staff right now Hi, I'm Carrie Payne.

Thank you. The other question which is back to I remember from reading your big package last time and also other studies and presentations by members of the public and stuff that's out in the public domain as to the fact of the nexus question is if you build x number of market units what percentage of additional demand of affordable housing do we create because that's you know that's we don't want to make this situation any worse and i know that's you know this is where this dialogue about it and Inclusionary housing really is on that foundation Honestly, it's it's not we're out there try to p

And really, back to my fellow commissioners, that's sort of the foundational question.

Commissioner Wiscombe. Thank you, Madam Chair. I just wanted to comment and ask a question about Commissioner Wardlow's comment about perhaps lowering from $91 down. I gather that's what you wanted to do.

Yeah, I understand it's in the CBD, but My question, I guess, to staff is what is our goal here? Isn't it to actually build a housing? Because if you lower that fee, then you're gonna get, it's an offset fee, and you're gonna get more downtown developers saying, no, I'm gonna just opt out of building the housing, and we're gonna lose some economic diversity downtown, I think. That's my feeling. I don't know if staff has considered lowering that number. I know some people think it's really high, but it seems to me, based on that calculation we saw for the 4.3 units, that it was very reasonable,

Yeah, that's what I thought, and I'm not saying that you advocated for it, because you said you didn't know how you felt about it, but I was, I guess I just felt that staff needed to address that, because I think our goal is to get the housing, but there are going to be some developers that just say, I'm not going to build it because I don't want to manage it for 90 years, and You know, so I'm just going to pay the fee and move on. And it seems to me that's what we've heard for years from developers. Give us that option to do that. And this seems very reasonable. So that's my comment. Thanks.

Is it okay that I, like, respond to Commissioner Wiscombe?

Okay. Well, I think what I'm trying to understand, so I very much want to see, housing units downtown that have affordability in them. My concern is that we're not getting that. And so I'm trying to figure out a way that we can meaningly start to get housing downtown while understanding that we are about to, and this is very important to me, that we vigorously pursue our plan around bringing affordable housing to city-owned assets and lots downtown. And given the ongoing discussion about how do we fund the affordable, the local housing trust fund, This to me could be a way that we start to get

I think we're kind of veering into comments and deliberations, but I want to make sure that we finish up questions first. But I also think staff may have wanted to respond at some point during that.

And Commissioner Peterson, did you still have a question?

No, no, comments. Okay. I thought we were moving to comments.

No, you're fine. Are there other questions? My questions have been asked and answered several times. Do we want to take a break before we go to, yes, okay. So it is 2.43 right now. Let's be back by 2.50.

2.52 p.m., and we'll open it up for comments and deliberations. Commissioner Peterson?

So, and I meant to ask this earlier, but, and I know that we have talked about this extensively, about the residual land value, and I know that this, you know, in the previous hearing, we were all concerned about the way in which the report was done, why we used these calculations compared to the previous inclusionary study that used a different type of calculation, and obviously the benchmark set a 10% versus, like, a 7% or 8%, which is more a normal kind of return, but... When I'm looking at the 91 for the fee out, I saw somewhere here that it says it creates that at a 91 full fee out case p

Because the base density, because the inclusionary units now we're allowing to be on top of the base density. Correct.

But it it goes back to the point that like the, the fee out program that we're talking about, it is financially a lot more challenging versus if we were to, and I'm still a little confused on what is the exact, like commiserate with construction costs figure. Um, if we could get that, that would be, that would be helpful for me. I don't know if it's helpful to anybody else at this point, but, um, that that's my concern is that we're still, if we're allowing the fee out, it seems like people probably may not do it because it's, Negative on the financial side for them and yet I'm just okay. I'm

But then so if we came up with a happy middle part let's say 75 I'm just making up a number then doesn't that wouldn't that ensure that like then they do fee out and we get the money but then we're just not going to get the units in that case.

But if you're saying that because we're now allowing the base density, the inclusionary to be on top of the base density, and that that is financially in some ways better, right? Yes, it is. Is there a number that we can come up with that ensures that that's still financially better because you're getting the base density piece on top of it, but that the fee out is not financially worse than just... Is there a middle ground here?

I really appreciate all of your tremendous work on this, and thank you for entertaining all of my questions. Thank you.

Okay, we're in comments. I think earlier it was said that developers would like a $0 rate. That's the thing that pencils out. But I hope that there's a number that works more than that. if we do some innovative things and if we provide concessions. And I think one of the contexts of all of this is state density bonus law. I think that's the reality under which we're operating. It's not either we get 10% or we get nothing. It's either they use our local program or they don't build at all or they use state density bonus law. And so I'm really hoping that there's some kind of information that we

Thank you, Madam Chair. I'll start with what he just ended with. I'm going to be supportive of whatever we come with, but boy, there's a lot of asterisks and footnotes to my support. I understand that this is tied into so many other things that we're doing associated with housing. One of the public speakers said that, Mr. Lewis, said that only five middle income or moderate units had been built. I'm curious, how many units have been built under the current program that we have? Do we have any idea?

And it came up in our first discussion. I know that we keep throwing out the word affordable, but this is aimed at moderate affordable, 100%, right? Because the in lieu fee, if we give it to, and I use the general term housing authority, if we give the in lieu fee to the housing authority, they're not going to be able to use their multiplier for moderate type housing because it isn't available for that category. And I think that distinction is really, really important. And I don't think, to go back to what I was commenting about the council, everybody at the city council is just like us. We're

Do we have other comments? Go ahead. Sorry, Vice Chair DeLuccio.

I was going to wait. I wanted to hear what my other commissions had to say, but that's fine. I think at this point we just need to move this to council. We're not the only city struggling with this. And if we don't, you know, it's like, but I think you've done a great job, staff, on this. And thank you, Commissioner Wiscombe, for helping me understand dissecting the $3 million that works out to like $738,000 a unit. So that puts it more into perspective. So I'm comfortable moving that forward to council, because I don't know what council's going to do. They may not go with it. They may lower t

Middle income, we need those. obviously we need low and low the lower side also but we need to do need to balance it out so um but it is very frustrating because we're not making we're not meeting the numbers we're not the only city not meeting the numbers so um but i think if that you we're at a point i think this should just be moved on to to council at this point and we need to as we go forward we need to obviously we need to continue on looking at this at housing and how we can actually Get more units in the city that are affordable. So I think those are my comments for now.

Thank you Commissioner Westcom Thank You madam chair Okay, I I Just did some calculations I think I think what we have to think about here that I understand Commissioner Ward Lowe's comments about lowering the the cost and i think commissioner peterson said you know are we better off not building the two units in the 20 unit building but building the 20 units of deed restricted housing across the street i think we have to realize or keep in mind that we're dealing with moderate units and and the leverage is different if if at all for moderate units when you come to when you come to um the loca

Okay, yeah. Well, I think it's a point that we have to realize, that we're going to get dollars for fractional. And the comment that you made, Ms. Faulk, on this, if we lower the fee, it deprioritizes on-site deed restricted units. And I think that's really important for diversity. I think we need those. I did just a calculation. If we lowered it to $72, I used $72 because that's what we were talking about before, that for those 4.3 units, it comes to $2,510,856, and that's $583,920 per unit, which I know is too low. It's over $100 a square foot, I think, to build a unit. So I just It's way to

Thank you. Do we have comments from others? So we're specifically looking at comments or feedback on the fee for fractional fees. because that's changed since the last time it came to us, and also more specifically on G2. If you'd like. Yes. Commissioner Bauke.

Thank you, Madam Chair. This is a conundrum, honestly. And maybe it's just my instincts and knowing what I do for a living and run gap analysis and run the numbers on these things and looked at what the inclusionary impact on a project would be to the financials of what we would sell. Sometimes I was a land seller and sometimes we were the developer. So it's still the same number. You still go do the same math to figure out what the market value of the land is. And in all cases, no matter where it is in the state of California, there's some kind of inclusionary requirement of some shape or for

Has everybody given comments? I'm going to go to Commissioner Wardlow and then back to Commissioner Barnwell.

Thank you, Madam Chair. I want to give a personal experience. I hope the legal counsel here doesn't stop me, but it has to do with what is the policing of the units to make sure that they remain affordable? Now, I know this sounds preposterous, but as an appraiser, I was given an assignment to appraise a 20 unit in Isla Vista. all market units, market rent. Normally, I get a copy of the deed and deed restrictions, but that was kind of a rough job. I didn't get that. I appraised it and went down to the bank in Los Angeles and they called me back about five days later and said, what have you don

You're better than the county then. Very good. Thank you. Thank you, Madam Chair.

I kind of echo a lot of the comments from some of my fellow commissioners of like this is a conundrum. I think we all really want the same thing and I think we're struggling with how we actually ensure that we get there, that we actually get more housing projects and that we actually start to achieve better affordability. I'm really torn about this. I very much understand Commissioner Wiscombe's perspective that we want to see moderate income units included in these buildings. My concern is that we just aren't getting a lot of those projects. And when I think you are going to, I think staff wa

13 rental. So we have a lot of conversations around affordable housing, right? And we all are committed to this. But when we're talking about 13 units over how much time?

Oh, wow, that's worse than I thought. Okay, I thought that was from 2021 or since the beginning of this RHNA cycle. So since 2019, we've gotten 13 units.

Yeah, okay, so that furthers kind of my concerns, right? So if we're getting such a small amount moderate which is what we all want to see but the numbers are really low and that also we're not getting as much just housing in general you know that really concerns me and I think we need to do something to ensure that we're actually making progress on these goals that I think we all share I want to start with just saying that I do believe that what we're doing in this ordinance is in terms of increasing and allowing the base density that the inclusionary units that you build on top of that, that

So I know staff needs clear feedback to take to council, so I'm wondering if it would be helpful if we nicely ask Commissioner Wiscombe to restate her feedback and had other commissioners say whether or not they agreed with her feedback. Would that be helpful, or is there a different format that would be helpful for feedback?

Lucille, you haven't spoken. I have not. Do you want me to make comments and then the motion? If you're willing, yes. Okay. Well, I think, first of all, we have to realize the goal here is we want to develop moderate deed-restricted units in the city. The lowering the fee for that, I think, deprioritizes the on-site deed-restricted units. And down to the point of the units becoming 583, let's call it 584,000 per unit to deposit in the local housing trust fund, I think we all realize that's really low. And that's going to catapult, I think, a lot of money going into the trust fund. But keep in

Sorry, Jasper. Okay. And it's actually net livable floor area. Yeah. I think that's what we want to be consistent. So if we have examples of Calculation examples that show net livable floor area, we want that in the definition, which doesn't exist there right now.

Did the motion include CEQA and consistency with general plan and city charter as well? Yes, yes.

So item B of the recommendation to forward to city council and item C. Second, second, second.

further discussion, especially if there's further discussion around the exact fees around G2. Commissioner Barnwell.

Before it's lost, I think before it's lost, the council needs to know that we think there's so much more that needs to be done on this whole concept, including what Commissioner Wardlow said, which is our own city-owned land and designating whatever kind of people we want to rent those units. But I think whatever we do with the council, we need to carry forward the idea that this is just the tip of the iceberg as far as we're concerned.

The only thing I would add is in our tables that we had, there was spread of in-lieu fees by methodology, and I would support the $73 that Commissioner Wardlow suggested. based on that, but I understand if the majority isn't there. This would be for the G2 fee out 100%.

I think it was $72. That was what's in the report, $72.

The upper bracket was $73 in the construction cost. I was trying to go off of what is the actual construction cost. That was what was in the chart.

If that's a request to amend the motion, I think... Are you requesting to amend it?

Oh, well, yeah, I guess we're talking about the motion. Sure, well... That's where my vote is, but I'm willing to go with where the majority is. In the business district, right? Yes. Well, that's what you said, right?

Yeah, I made the motion. My comments were focused on the business district. I am open to hearing others' perspectives, but that's where I'm at.

So I'm going to quickly look to city attorney, because I think we have competing motions. Do we need to vote on one to move to the next?

Okay. Yeah. And so now it would theoretically be discussion on the amendment. We could vote on the amendment and then vote on the motion.

Okay. So we have the motion to keep as is, but we have a request to amend it to 73. So we'll now have discussion on that request. Okay. I'm supportive of that as well.

Well, I'm supportive of that being in the business district, in the 73, but the rest of the city, we're talking about the 91, correct?

Yeah, that's what I'm talking about for this, because I think this discussion, you know, I think Commissioner Wiscombe raises a lot of good points. You know, I look forward to kind of seeing what council says. I would be open to considering it citywide, but given how this discussion has gone, I think to center it in the central business district for this purpose.

Well, if that's your intent, then that I can go for, just, you know, in the business district, but not the entire, and the balance of the city would be the $91 million.

I'd like to hear from Commissioners Bauke and Barnwell and then to the motion maker.

What? Wow. I think it's a number that's been thrown out without any consideration other than the fact that it lowers the cost of a unit to $584,000, which is a steal. You're not gonna get any moderate units built in the central business district, I don't think. I think you're just gonna get contributions to the local housing trust fund. And where, yes, you will get affordable units built eventually from the local housing trust fund, you're not going to get the moderate units, which was the goal here of the program. And I also feel that we have not given this offset fee a chance to take it for

Couldn't we vote on the, since we're considering the motion on the floor, couldn't we consider an amendment to that motion, vote on that amendment, and then vote on the motion? The motion maker has to.

Am I able to, if we're still in the discussion, am I able to respond to Commissioner Wiscombe?

So I just want to be clear. I also am concerned that then we don't get the moderate units downtown. But again, because we only have 13 units throughout the whole city since 2019 that are hitting that moderate income, that's why I'm looking at this, is because I want more affordability, and yet just wanting that isn't happening. And when I said 73, it's not an arbitrary number. It's the number that was noted in the... in the staff report as the cost of construction, so I thought that that was an equal and fair landing point. But I hear you. I also want affordability. I am just concerned that we

Okay. But I also feel that we haven't given developers the option to have an offset fee, and now we're giving them that option. The amount of money we're getting per unit at your $73, I think I calculated at 72, so I might be off a little bit, but $584,000 does not build a unit. And I think we all know it doesn't build a unit. I would be happy to keep the motion as it is and also to make comments to city council on a very considerable discussion we had up here about lowering that fee in the central business district. But I think that that should be studied more, and I don't think it should be

I don't think it's an arbitrary number. It was the recommendation in the study was 71, and then the cost that is noted Actual study on what it costs to construct was 73.

So it's not that I'm making up the number Someone needs to make a substitute motion. I think that's what Benjamin did.

I'm sorry I want to go in order of folks who have requested to speak. So vice chair dilute you.

Okay. I want to make a comment We don't know what the council is going to come up with what dollar amount Okay, so that I just want to throw that out there that being said Your calculation is 580 580 $4,000 in case that'll go into the housing fund So if we give that incentive, the lower cost to put into the housing fund, when we go to use those dollars, that'll multiply. We're on it from four to maybe up to 10 times. So we can, that's another avenue in order to get us the affordable housing that we need. So I'm willing to go along with that. I'll make a substitute motion if I can. We should ca

We need to first finish this discussion. Commissioner Barnwell.

I'd like to call for the question, which is vote on the motion.

The motion, which includes the 91 and 72. Correct. Then you made a substitute motion. There's not been a substitute motion at this point.

No substitute motion. The original motion, which does not include Commissioner Wardlow's changes. Can I withdraw my motion?

I second it. Can I withdraw the second to my motion?

No, you can't. There's a motion on the floor. I second that motion. Doesn't matter. She made it, too. We've got to vote on that. And then we either vote yes or no, and then we do a new motion that's... Let's do a substitute motion, please.

The substitute motion would be to everything that's been discussed here as part of the motion, the... The definition and all that. And also, the substitute motion would be the $73.

The $73 in the central business district. The central business district only.

And the balance of the city would be at the $91. I'll second that.

Did that motion include CEQA and consistency with general plan and city charter?

Yes. And also the definition of living areas.

Ms. Carman, can we please have a roll call vote on the substitute motion?

I'm voting no because I think that, first of all, we have never given developers an opportunity to have an offset fee, which this package gives them. I think that the $72 or $73 a square foot in the CBD, which is probably the highest cost place to develop in the city, Uh, produces a unit that's, that's below 600,000 per square foot. And, uh, I'm sorry, per, per unit, 600,000 per unit, according to our examples. And it's, it's going to create a lot of developers that come forward and, and just, uh, give, give money when staff has said our incentive is to build. some affordable units downtown so

Actually pretty much as you notice it went back and forth on this and I'm sort of teetering But I think Commissioner wisdom stop Ross's is where I pretty much landed at the end of this which is this is a little premature to jump to that because I think they are our goal is we're giving them a some significant ways to do this different than what we've had before. I think we should at least give it a test ride before we start lowering things. I think we do that later if we have no takers.

We're now, thank you, Ms. Carman. This action is not appealable. The next steps are just that we'll go to council, correct? Thank you. We'll close that item and move to the administrative portion of our agenda with a lot of gratitude to staff for being in this conundrum with us, and we appreciate your due diligence and time spent on study. Moving on to the administrative portion of the agenda, committee and liaison reports, beginning with the staff hearing officer report.

I have a brief one. I was actually in person yesterday because I met with staff on the other item we just took up. Two things were on the agenda, 167 Vista Del Mar Drive, approval of a coastal development permit to allow for an ADU, and then 1454 Harborview Drive, approval for a coastal development permit to allow for an ADU and requires a front setback modification to allow for increased roof height. That's my report.

Thank you. Any other committee liaison reports? Okay. Move on to discussion on subcommittees and workshops. I think as a result of this item discussion and past meetings. We had a good discussion with council about downtown density and I understand that we'll be reconvening to talk about city-owned land, but are there other items that we would like to add to this list? Okay, then it is now 3.47 p.m. That concludes our August 20th Planning Commission hearing. Our next meeting is tentatively scheduled for Thursday, September 3rd. Thank you.