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In 2012 the Council adopted a Housing Element containing 84 different programs, approximately 19 of which were new. Since that time, the City has made progress in the following areas: • Permits issued for 467 dwelling units • Several appropriations, the largest of which was $8 million from the Low-Income Housing Fund to support redevelopment of Kottinger Place and Pleasanton Gardens apartments • Approved of two BRE projects in Hacienda for a combined total of approximately 506 rental units, with affordable housing agreements for 76 units • Approved four additional sites with a combined total of over 1000 single and multi-family units • Amended Growth Management Ordinance to assure compatibility with RHMA • Initiated a nexus study to determine if there is a need to update the Lower Income Housing Fee • Supported a wide range of non-profits organizations related to housing • Hosted workshops and produced promotional materials to conduct outreach in support of affordable housing • Adopted development standards and guidelines for high density housing • Approved amendments to zoning regulations aimed at reducing barriers to the development of housing for special needs groups Ms. Stern identified the following as programs that require additional work to be completed in 2013-14: • Density bonus ordinance • Survey of rental status on second units and analysis of potential incentives • Development requirements for second units • Complete nexus study regarding the Lower Income Housing Fee • Assessment of infrastructure needs related to the Growth Management Ordinance • Survey of older multi-family complexes and consideration of funding retrofits to create three- bedroom units Ms. Stern asked that the Council adopt the resolution allowing staff to forward the report to the Department of Housing and Community Development (HCD) and the Governor's Office of Planning and Research. Councilmember Brown requested clarification on "Density Bonus Ordinance consistent with State law." Ms. Stern explained that the law was previously very simply in that it would require the City to consider granting density over and above the zoned range for developers offering a certain percentage of affordable units or other types of affordably features. The law has become a bit more complicated in that it now allows City's to offer parking, height or other incentives to increase affordability. Councilmember Pentin asked and Ms. Stern confirmed that the City does currently possess that ability on a case by case basis, up to the limit provided for in CEQA analysis. Mayor Thorne opened the item for public comment. Mike Lung, Citizens for a Caring Community, urged the Council to postpone the processing of apartment development proposals until a 15% inclusionary requirement can be reinstated. Mr. Fialho suggested Mr. Lung was referencing the Palmer case, in which the courts rendered the opinion that cities could not regular or mandate a requirement of inclusionary housing on rental complexes like apartments, which does call into question the validity of the City's own ordinance as it applies to apartment units. He noted that it is still the objective of the City to meet its inclusionary goals, that all developers currently working with staff have expressed an interest and willingness to comply, and that these goals can still be achieved through conditions of approval or development agreements. Additionally, the development standards and guidelines recently adopted by the Council require developments of 30 units or more per acre to comply with the 15% inclusionary requirement. City Council Minutes Page 3 of 10 March 5, 2013