AGENDA REPORT - Laserfiche WebLink

of which 69 or (6%) of that total will be reserved for very low income households. However, the current RHNA includes a very low income unit target of 716 units representing 35% of the total 2,067 unit target. Considering that the recently approved developments included one tax credit project, it's unlikely that the City will be able to rely on market rate developers to meet the very low income targets and as such, the most probable course of action for increasing very low income units may be for the City to acquire property and pursue a non-profit partnership to construct a development that is focused on this income category. As can be imagined, considering that the Kottinger Place/Pleasanton Gardens development will require at least $8 million in City contributions with the land being provided at no cost, the current lower income housing fund balance of $7.9 million may be insufficient to meet this type of a project. While the Report clearly outlines justification to adjust fees, staff is recommending either Option 1 or Option 3, with Option 3 being the preferred option. Overall, Option 1 can be recommended because, as indicated above, there is no immediate need for increased revenue and because staff expects that it will continue to pursue the provision of affordable units rather than the payment of fees for new development. Therefore, there may not be any significant revenue gains from residential development in connection with and adjusted fee. Further, programmatic needs are not driving the need for additional LIHF. Notwithstanding this, the Report states clearly that new market rate development is not mitigating need for affordable housing that it is creating and as such, a fee increase is justified. This is particularly true in the area of single family homes. Also, as noted above, the City is most likely well short of meeting its affordable housing goals as set forth in its Housing Element and opportunities to lower this gap will most likely require considerable funding from the City. Finally, the Report's development financial feasibility analysis indicates that development can reasonably absorb these increases and still meet financial expectations. Housing Commission The Housing Commission reviewed the draft fee report as an informational item, minus the development feasibility analysis, at its meeting of July 23, 2013. At that time, the Commission expressed interest in maintaining the current fee categories and requested that staff provide a survey of fees in other Tri-Valley communities. As indicated previously, the fee survey is included as Attachment 4. Submitted by: Approved y: Steve Bocian Nelson Fialho Assistant City Manager City Manager Page 11of12