CITY COUNCIL REGULAR MEETING AGENDA PACKET

Page 1 of 3 Item #4 CITY COUNCIL AGENDA REPORT December 3, 2024 Community Development TITLE: ADOPT A RESOLUTION APPROVING AN APPLICATION FOR THE CALIFORNIA SENATE DISTRICT 7 ACCESSORY DWELLING UNIT ACCELERATOR GRANT FUNDING IN THE AMOUNT OF $192,043.18, AND AUTHORIZE THE CITY MANAGER TO ACCEPT THE AWARD AND MAKE APPROPRIATE BUDGET AMENDMENTS IN THE MISCELLANEOUS OPERATING GRANTS FUND SUMMARY The City is eligible to apply to receive up to $192,043.18 in State grant funds to accelerate the construction of Accessory Dwelling Units (ADUs) in the city. The funds are part of an overall $2.5 million allocation secured by Senator Steve Glazer in the recent State budget, available to jurisdictions within Senator Glazer's Senate District. If awarded, this grant to fund an ADU Accelerator incentive program to encourage homeowners to construct ADUs. Of the $192,043.18 prospective grant funds, staff proposes to allocate $50,000 to fund the City's pre- approved ADU program; the remaining $142,043.18 would be available to eligible homeowners who construct and receive a certificate of occupancy for their ADUs prior to the end of the grant program on September 30, 2026. RECOMMENDATION Approve an application for the California Senate District 7 Accessory Dwelling Unit Accelerator Grant funding in the amount of $192,043.18, and authorize the City Manager to accept the award and make appropriate budget amendments in the Miscellaneous Operating Grants Fund. BACKGROUND The ADU Accelerator grant program was announced by State Senator Steve Glazer in September. The overall program secured up to $2.5 million available to jurisdictions within Senator Glazer's Senate District 7, which covers Contra Costa County and the Tri-Valley cities in Alameda County. The Town of Danville is serving as the grant and reporting administrator to the California Department of Housing and Community Development (HCD), which is responsible for disbursing the State funds on behalf of the eligible jurisdictions. The amount of funding available to each jurisdiction is based on a formula: $50,000 is assigned to each jurisdiction for pre-approved ADU plans, and the remaining funding is allocated on a per capita basis of $1.89 per person, amounting to $142,043.18 for Pleasanton. With respect to disbursement of grant funds, the amount of rebate that a homeowner would be eligible to receive is based on whether they choose to deed restrict the ADU to low-income households for a minimum of 20 years and the size of the ADU, with smaller ADUs eligible for larger rebates. For example, a deed-restricted ADU less than 500 square feet could receive up to a $15,000 rebate, with progressively smaller rebates, up to $5,000, available as unit sizes increase. Non-deed restricted ADUs are eligible for rebates between $2,500 and $7,500, depending on unit size. ADUs larger than 1,000 square feet are Page 16 of 126