Gearing up for a major increase in new housing development requirements from the state, San Carlos officials highlighted development progress while recognizing shortfalls around new below-market-rate units being built in the city.

“We are making progress slowly, little by little, but these are very very hard units to come by,” said San Carlos Planning Manager Lisa Porras during a virtual planning commission Monday.

While not yet official, it’s likely the city will be tasked with building 2,735 new units, said Porras but San Carlos is still short of its current goal by 364 units. Remaining units would not be added to the updated Regional Housing Needs Allocation numbers, a state mandated process that requires cities to strive to meet growing housing needs, said Porras.

Currently, the city’s RHNA goal, set in 2015, is to build 596 units ranging in affordability within a nine-year window. But some units are more difficult to have built than others, said Porras. Despite having built 575 homes ranging in size between 2015 and 2020, only 232 of those units count toward the city’s RHNA goals.

In the past five years, the city has issued building permits, the metric used for counting new units, for 22 very-below-market-rate, 14 below-market-rate, 13 moderate and 526 above-moderate units. It surpassed its above-moderate goal by 343 units, according to Planning Department data.

Commissioner Jim Iacoponi suggested the city search for lots it owns or can acquire to build additional below-market-rate units in partnership with developers. By joining a city-owned lot with a neighboring property on Cherry Street owned by the nonprofit HIP Housing, the city will see up to 35 new affordable homes.

“It seems like the city has to be a market maker here,” said Iacoponi. “With all of the great intention, the progress still leaves us … behind where we want to be.”

Acknowledging the difficulty in finding development partners when looking to build affordable units, staff also said the city is looking at other ways of acquiring property through joint power authorities throughout the state.

Local jurisdictions are also looking into developing a method for determining how many accessory dwelling units are being rented at below-market rate. ADUs account for a majority of new above-moderate homes built in San Carlos, said Porras, a trend she said began around 2016 when the state began addressing barriers to building ADUs.

Before the law changes and related media attention, the city would see around seven applications for ADUs a year but now that average has increased to between 30 or 40 applications, she said.

Interested in boosting development of affordable units during the pandemic, the City Council voted to bring its local ADU ordinance in step with state law which allows for two different kinds of ADUs to be built on one family lot, a detached ADU and a junior accessory dwelling unit.

“With all the ADUs coming on line, that’s really the intent of them to be more accessible and more affordable than a standard condo or an apartment sometimes and definitely a single-family home,” said Porras.

State law allows for an ADU of at least 800 square feet that’s 16 feet in height with 4-foot side and rear setbacks to be constructed by right. City law permits ADUs up to 20 feet when built over an existing building though those heights will be reassessed by the end of 2021.

But without a method for determining whether those units are being rented at below-market rates, they will be included in the above-market rate section, said Porras. Officials with 21 Elements, a San Mateo County planning project, are surveying owners of recently built ADUs to develop a methodology for data gathering to have the units count for other affordability categories.

Commissioner Kristen Clements suggested the planning department also monitor changing state legislation that may affect local residential development. She noted the state routinely reassess how to “make municipalities responsible for goals.”

Offering to return with additional information at a later date, Porras said the department is specifically monitoring Senate Bill 9. The bill if approved would permit the development of duplexes on single-family zoned lots by right.

“Any kind of change that happens to single-family zoning there’s a lot of eyes on it,” said Porras.

Chair Ellen Garvey also recommended staff look toward other San Mateo County cities that may be on schedule with achieving its goal for additional direction on how to better pursue development of affordable units.

To help residents better understand the RHNA process, the city plans on hosting a third workshop on the subject in April or May. The City Council will be presented with the report during its next meeting Monday, March 22.

(650) 344-5200 ext. 106

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