Hold your horses

In the ongoing effort to prepare a Housing Element covering the next eight years, one might well conclude that the time has come to break out the champagne:  City Planner Andrew Thomas and his staff, it appears, have managed to find sites sufficient for the City to meet its assigned share of the Regional Housing Needs Allocation – with room to spare.

The target set by the regional authorities for the City of Alameda is 5,353 new housing units between 2023 and 2031.

The latest draft site inventory prepared by Mr. Thomas shows that, without having to touch the zoning for any residential district, the City can generate 5,647 new units (6,352 if ADUs and SB 9 units are included) during that period.

But when Mr. Thomas appeared before the Planning Board last Monday, he wasn’t there to celebrate.  Instead, the City Planner’s mission was to convince the Planning Board to recommend that, notwithstanding the apparent success in meeting the RHNA quota, Council still needed to make dramatic changes to the City’s residential zoning ordinances.

What’s going on here?

Well, as best as the Merry-Go-Round can tell, the goal posts have shifted – in two ways.

First, the RHNA target the planners say the City must shoot for no longer is 5,353 new units.  Instead, according to Mr. Thomas, it’s somewhere between 6,156 and 6,959 units.

Second, the planners are adamant that simply meeting the RHNA quota won’t result in a certifiable Housing Element.  Instead, according to Mr. Thomas, the City also should – indeed, must – “affirmatively further fair housing” by rewriting the residential zoning ordinances to allow multi‑family housing by right and remove density limits throughout the city.

We’ll start with the numbers.

The share of the Bay Area RHNA assigned by the Association of Bay Area Governments to the City of Alameda last May hasn’t changed.  And, up until January 2022, the staff reports consistently gave the 5,353-unit figure as the target the planners were trying to hit.

Based on an updated draft site inventory provided to us by Mr. Thomas after the March 14 Planning Board meeting (which, he cautioned, remained subject to further revision), the City will be able to meet, and indeed exceed, the published RHNA quota from five sources, none of which would require re‑zoning any of the residential districts:

  • Sites already zoned to permit residential use: 2,211 units.  This includes North Housing (586 units), Habitat for Humanity (68 units), Admiral’s Cove (190 units), McKay Wellness Center (100 units), Grand Street Pennzoil (91 units) Alameda Marina Phases 2 and 3 (364 units), Boatworks (182 units), Eagle Avenue (41 units), and Encinal Terminals (589 units).
  • Additional housing at Alameda Point: 1,489 units.  This includes 700 units at Site A and 789 units at the West Midway site.  In February, staff presented the Planning Board with a plan to put additional units at the Point by executing new entitlement agreements (or modifying existing ones) with the private developers.
  • New housing in shopping centers: 1,200 units.  This includes 800 units at the South Shore shopping center and 200 units apiece at the Harbor Bay and Alameda Landing shopping centers.  In January, staff presented the Planning Board with proposed zoning amendments creating an “overlay district” for the seven shopping center sites in the city.  This district would allow multi‑family housing by right and would require a minimum residential density of 30 units per acre.
  • New housing in the Park Street and Webster Street corridors: 488 units.  In February, staff presented the Planning Board with proposed zoning amendments to the “community commercial” district that covers both corridors.  Like the proposed shopping-center overlay, this amendment would allow multi‑family housing by right and would require a minimum residential density of 30 units per acre.
  • New Clement Avenue projects: 259 units.  Mr. Thomas told us he had determined that two additional sites located on or near Clement Avenue were suitable for residential development:  2199 Clement Avenue (141 units), a 4.7-acre site that is currently vacant and zoned for industrial use; and Thompson Field (118 units), the football/soccer/track field that, Mr. Thomas told us, the Alameda Unified School District has notified him it intends to dispose of as “surplus” property.

This list, Mr. Thomas told us, is “pretty stable,” and he doesn’t have any other sites “in mind.”  All told, the five sources will generate 5,647 new units – 294 units more than the 5,353‑unit RHNA quota.

Beginning in January, however, Mr. Thomas began to hint that this wasn’t going to be good enough.  The January 14 staff report to the Planning Board recited the 5,353 figure, but it then stated, “Per State requirements, the City will need to accommodate buffer units for a total of 6,156 units.”  The February 10, February 28, and March 14 staff reports didn’t mention any “buffer,” but the term appeared again in the slide show Mr. Thomas gave last Monday.

The state Department of Housing and Community Development, Mr. Thomas explained, had published guidelines recommending a 15‑to‑30 percent “buffer” above the RHNA quota in order to “avoid the situation where you might have a site that you anticipated will do a certain number of units and then it turns out it doesn’t.”  This meant, he said, that “effectively we’re planning for somewhere between 6,100 and 6,900 units” – or, more precisely, between 6,156 and 6,959 units.

Mr. Thomas wasn’t making it up about a “buffer.”  But he left out a couple of significant points.  The HCD guideline to which he refers consists of two sentences found at the bottom of page 21 of a 44‑page document.  It states:

To ensure that sufficient capacity exists in the housing element to accommodate the RHNA throughout the planning period, it is recommended the jurisdiction create a buffer in the housing element inventory of at least 15 to 30 percent more capacity than required, especially for capacity to accommodate the lower income RHNA. Jurisdictions can also create a buffer by projecting site capacity at less than the maximum density to allow for some reductions in density at a project level.

(Emphasis supplied.)

On its face, the guideline is not a command; it is only a recommendation.  A city is not required to create a 15‑to‑30 percent “buffer,” and, indeed, it may achieve the same prophylactic result by discounting the “capacity” of a site computed using its acreage and zoning.  This in fact is exactly what the City did when it listed what it called the “realistic capacity” for each site in the two most recent Housing Elements.  For exclusively residential sites, the discount was 10 percent; for mixed‑use sites, it was 40 percent.

Moreover, the guideline seems designed primarily to ensure that a city will meet its RHNA quota for lower-income units.  But the City of Alameda does not need to create a “buffer” in order to achieve that goal.  For the very‑low‑ and low‑income categories, the target is 2,239 units.  According to the latest draft site inventory, the sites already zoned to permit residential use will produce 908 units in those categories, and Alameda Point will add another 405.  Both the shopping center overlay and the Park Street/Webster Street amendment provide for a minimum density of 30 units per acre, which means that the 1,688 units estimated for those sites, too, can be counted in the lower‑income categories.  So now we’ve got 3,001 very‑low‑ and low‑income units.  This amounts to a “cushion” of 762 units (or 25 percent); why should the overall total include a “buffer” as well?

But let’s say the City needs to provide a “buffer” anyway.  (And Mr. Thomas told us he’s certain HCD will insist on one.)

There are two categories of housing that we haven’t discussed so far – and that weren’t included in the analysis that got us to 5,647 units.  But they may solve any lingering “buffer” problem.

The first is Accessory Dwelling Units.  Back in June 2017, in response to a new state law, the City passed an ordinance allowing the owner of a single-family home to put an ADU of up to 1,200 square feet on her lot.  (The ordinance was updated in January 2020.)  Since then, ADUs have flourished in Alameda:  26 permits for ADUs were issued in 2019, 39 in 2020 and 79 in 2021.

A city is entitled to count projected ADUs against its RHNA quota.  So how many can the City of Alameda expect during the next eight-year cycle?  Mr. Thomas has been estimating 480 new ADUs, but the Alameda Citizens Task Force persuasively argued to the Planning Board that this figure is too low.  The HCD guidelines, ACT pointed out, encourage a city to use the trend since January 2018 to predict the future number of ADUs, and “[c]learly, the ADU construction in Alameda is trending upward and there is every reason to believe that this trend will continue as the demand for housing increases.”  For this reason, ACT said, it would be more appropriate to project 632 new ADUs (rather than 480) over the next eight‑year cycle.

At the Planning Board meeting, Mr. Thomas acknowledged that ACT’s argument had merit – up to a point.  He was familiar, he said, with the HCD guidelines endorsing the use of trends, but his consultants had told him that, despite the guidelines, HCD “actually” uses an average for the last three years to estimate future ADUs.  Nevertheless, he conceded that the City “could make the case” for the higher number suggested by ACT.  In that event, the site inventory would increase from 5,647 units to 6,279 units.

And then there’s SB 9 units.  Earlier this month, Council passed an ordinance implementing the new state law entitling the owner of a home in a single‑family residential district (R‑1 in Alameda) to build another unit on her lot – and to split the lot and build two units on the other half as well.  An eligible homeowner taking full advantage of SB 9 thus could produce three new units that could be counted against the RHNA quota.

Once again, the question becomes how many new units to project for Alameda over the next eight years.  Unfortunately, the HCD guidelines are silent about SB 9 units.  The latest draft site inventory estimates nine units per year for an eight‑year total of 72 units, but Mr. Thomas cautioned the Planning Board that “I’m a little nervous” about that forecast because the City hadn’t received any SB 9 applications so far.  The new law, however, only went into effect in January, and if the current projection for SB 9 units is accurate, the site inventory would grow to 6,351 units.

This amounts to a 998‑unit (or 19 percent) excess – a “buffer,” if you will – over the 5,353‑unit RHNA quota, accomplished without any zoning changes to the residential districts.  Would HCD really insist that the City of Alameda do something more to get its Housing Element certified?

If you put that question to Mr. Thomas – as Planning Board member Hanson Hom did last Monday and the Merry‑Go‑Round did later in the week – his answer would be an unequivocal yes.

And what might that something more be?  Why, get rid of Article XXVI of the City Charter (aka Measure A), of course.

Here’s how Mr. Thomas put it in response to Mr. Hom:

So [the] staff recommendation is, we should not be sending a housing element to HCD that says oh, we’re going to continue to prohibit multi‑family housing in our residential zoning districts. I guarantee you the very first comment we will get back from them, among seven pages of comments, will be, “You’re prohibiting multi‑family housing in residential zoning districts?  No, that’s not going to work, Alameda.”

The City should  eliminate the offensive provision, Mr. Thomas suggested, by re‑writing the residential zoning ordinances to allow multi‑family housing and remove density limits throughout the city.  He offered two alternative approaches.  One would be to amend the zoning ordinances for the R‑3 through R‑6 districts to allow multi‑family housing by right in those districts, and to abolish density limits for them as well as for the R‑2 district.  (The R‑1 district is a special case:  as discussed above, the ordinance passed to implement SB 9 now allows four units on every lot in that district.)  The other would be to create a “transit overlay” for parcels located within a quarter mile of a “high quality transit corridor.”  Multi‑family housing would be allowed, and no density limit would be imposed, on any parcel to which the “overlay” applied – even if the parcel across the street fell outside the “overlay” and thus remained subject to the existing zoning.

By this point – if not sooner – our readers may be wondering:  How could Council get away with this?  Article XXVI prohibits multi‑family housing; staff wants Council to allow it.  Article XXVI imposes density limits; staff wants Council to abolish them.  But it is axiomatic that an ordinance cannot amend or modify a charter provision.  Such an effort would be unlawful.  Unless, of course, the charter provision is preempted by state law.

Aye, there’s the rub.  By now, we’re familiar with the argument that, since state law requires the City to re‑zone residential sites if necessary to meet its RHNA quota, it preempts any local law – including Article XXVI – that stands in the way.  But is there any state law that similarly requires the City to re‑zone entire residential districts in order to allow multi‑family housing by right and remove density limits throughout the city, even if the RHNA quota already has been met without having to make those changes?

Mr. Thomas told us he believes the Fair Housing Act, enacted in 2018, is such a law.  And he’s certain that HCD thinks so, too.  But we’re not so sure a Superior Court judge would agree.

Under the Fair Housing Act, a city submitting a proposed Housing Element effective after January 1, 2021, must include a “program” designed to “affirmatively further fair housing.”  The latter phrase

means taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics.  Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws.

That “definition” surely articulates high-minded principles.  But it doesn’t offer much practical guidance.

The HCD guidelines seek to remedy this omission.  “For purposes of the housing element site inventory,” the guidelines state, the “fair housing” requirement

means that sites identified to accommodate the lower‑income need are not concentrated in low‑resourced areas (lack of access to high performing schools, proximity to jobs, location disproportionately exposed to pollution or other health impacts) or areas of segregation and concentrations of poverty.  Instead, sites identified to accommodate the lower income RHNA must be distributed throughout the community in a manner that affirmatively furthers fair housing.

The first part of the guidance is pretty clear – and easy to follow.  There is only one census tract in the City of Alameda that has been characterized as “low resource” by the California Tax Credit Allocation Committee:  tract number 6001428700, which includes Alameda Point and the northern portion of the West End.  So the Fair Housing Act, as interpreted by the HCD guidelines, can be read to preclude the City from putting all of its RHNA‑mandated new very‑low‑ and low‑income units in that area.

At prior Council and Planning Board meetings, Mr. Thomas made it clear that this was his own understanding of the law.  “Just in terms of physical space, we could easily build 5,000 units at Alameda Point,” he told the Board on October 15.  “But HCD will not accept a housing element that says, ‘Oh, we’re going to build all of our housing in the west end of Alameda, the area of Alameda that has historically been where the lower‑income households have gone and been able to live, in the areas of Alameda which have the vast majority of low‑income housing today.’  They’re not going to allow us to do that.”

Okay, so now we know where, under the Fair Housing Act, the City can’t put all of its RHNA‑mandated lower‑income units.  Which leaves the question:  where, under the Act, can it put them?  The HCD guidelines state that the lower‑income units “must be distributed across the community.”  But how?  Must every census tract falling into the high resource category get some lower‑income units?  Or is the standard even more granular:  must every wealthy neighborhood get a handful of lower‑income units?  And in either case, how should the City determine the appropriate number for each locale?

There’s also the issue of the availability of vacant land.  The Fair Housing Act may be read to prevent the City from putting all of the RHNA‑mandated lower‑income units in an area just because it contains a lot of vacant land.  But what about areas in other parts of town where there is very little vacant land – or no vacant land at all?  Does the Act require the City to force lower‑income units into these areas anyway?  And, if so, how should the City accomplish this feat?

Now, there is an easy solution to these dilemmas – and it is the one that Mr. Thomas presented to the Planning Board.  Rather than creating rules for distributing lower‑income units “across the community,” just re‑write the residential zoning ordinances to allow multi‑family housing throughout the city and refrain from imposing density limits in any district.  Certainly, HCD cannot object to a scheme that can be pitched as facilitating construction of lower‑income housing everywhere.

But let’s be absolutely clear:  The zoning amendments proposed by Mr. Thomas may be one way to enable the City to comply with the Fair Housing Act as he interprets it – but they’re not the only way, nor is his the only interpretation.

For example, suppose that the distribution requirement would be met if the City put at least some of the RHNA‑mandated lower‑income units in each of the four “resource” categories:  highest, high, moderate, and low.  If that were the standard, the latest draft site inventory already appears to fulfill it:  In addition to lower‑income units at Alameda Point (a “low” resource area), it also contains lower‑income units at sites along the northern waterfront (a “moderate” resource area) and at South Shore and Harbor Bay (“high” resource” and “highest” resource areas, respectively).

And now we come full circle:  If the zoning amendments aren’t necessary to enable the City to comply with the Fair Housing Act, they don’t preempt a local law like Article XXVI.  And if preemption does not apply, the proposed amendments run afoul of the City Charter and are therefore unlawful.

We’re not the only ones concerned about legal issues like those we’ve been discussing.  At Monday’s Planning Board meeting, Board members Alan Teague and Teresa Ruiz both asked – nay, pleaded with – Assistant City Attorney Celena Chen to commit her office to offering a legal opinion on the preemption question.  Ms. Chen equivocated, but it wouldn’t hurt to find out what City Attorney Yibin Shen has to say on the subject – and his opinion ought to be made public.

Mr. Thomas looks at the topic from a different angle.  To him, it doesn’t really matter how the lawyers – whether they’re in the City Attorney’s office or on the bench – construe the Fair Housing Act.  What matters is how HCD interprets it.  And, as he frequently points out, last November HCD senior program manager Paul McDougall signed a letter – written at Mr. Thomas’s invitation – stating that “Article 26 provisions deny fair housing choices and are fundamentally contrary to affirmatively furthering fair housing (AFFH).”

Conclusory and opaque as this statement is, Mr. Thomas is treating it as a signal that if the City submits a Housing Element that doesn’t get rid of Article XXVI, either through the proposed amendments or in some other way, HCD won’t certify it.  In that case, all the work that he and other staffers (as well as the Planning Board) have been doing for the last year or so will have gone for naught.  And the parade of horribles that Mr. Thomas routinely describes as the consequences of not having a certified Housing Element will ensue.

Now, there are those, we understand, who would accuse Mr. Thomas of being just a wee bit disingenuous.  The City Planner readily will admit that he’s never liked Article XXVI.  Indeed, he was one of those who urged Council to put a repeal measure on the ballot.  And when the ballot measure failed, his detractors suspect he simply dug into his bag of tricks and sought to achieve the same goal administratively, all the while claiming that he is just trying to keep the customer – in this case, HCD – satisfied.

Though cynical by nature, we’re not willing to swallow this thesis.  (We admit we may be prejudiced in Mr. Thomas’s favor because he always takes our calls and answers our questions).  Still, it sticks in our craw that, less than two years ago, 60 percent of Alameda voters chose to retain Article XXVI, and now it once again stands on the brink of extinction.  In the best of all worlds, we’d hope that the will of local voters would prevail over the wisdom (or whims) of state bureaucrats.

Sources:

Shopping center zoning: 2022-01-10 staff report to P.B. – shopping center zoning amendments

Park St./Webster St. zoning: 2022-02-14 staff report to P.B. – Park & Webster St. zoning amendmenrs

Alameda Point zoning: 2022-02-28 staff report to P.B. – A.P. zoning

Residential district zoning: 2022-03-14 staff report to P.B.

HCD guidelines: Housing Element Sites Inventory Guidebook (June 2020)

About Robert Sullwold

Partner, Sullwold & Hughes Specializes in investment litigation
This entry was posted in City Hall, Housing and tagged , , , , , , . Bookmark the permalink.

11 Responses to Hold your horses

  1. mrsmoppy says:

    Sigh… my head is spinning, what are they trying to drive its residents insane? Holy cow. So much corruption and nepotism. Greenwashing.

    • Que? says:

      I recognize each of these words, but stringing them together has my head scratching. Corruption? Nepotism? Who? Where? What the heck is green washing here? Just because you don’t like a process (or perhaps you don’t understand it) does not mean you get to throw out innuendos to put things in a baselessly conspiratorial light.

  2. Allan Mann says:

    The low number of ADUs being added to single family homes is a direct result of city building codes that make it financially impractical to do so. To top it off, SB9 appears to allow more units per lot in single family R1 zones than in multi-family R4 zones. Someone needs to look at that inconsistency.

  3. 2wheelsmith says:

    Thank you for a comprehensive and well researched article discussing the many issues that go into determining which neighborhoods should be zoned to permit more housing. In my comments on the General Plan I argued that zoning ALL of our residential neighborhoods for multi-family housing would be necessary to Affirmatively Further Fair Housing. SB-9 has done that for R-1 neighborhoods. I agree with Mr. Thomas that HCD will require us to do that for R -2 through R-7 neighborhoods as well.

    If one wants the Bay Area to continue growing sustainably, there is no alternative to allowing more people to live in our neighborhoods. Land is just as vital to life as water, electricity, and heat. How can we deny workers moving into our area a place to live.

    If we want to limit the number of people who live here, it would be much more humane to limit the number of high paying jobs that require low wage workers, whether in the office, the restaurant or the department store.

  4. Drew says:

    If I may, “the wisdom (or whims) of state bureaucrats” is just a wee bit disingenuous of a way to describe a state agency carrying out SB 828 (which strengthened the RHNA process) and AB 686 (which brought the Obama administration’s Affirmatively Furthering Fair Housing policies to the state level).

    Sixty percent of Alameda voters may disagree, and yet a majorities of our elected legislators across the entire state, including our own Senator Skinner and Assemblymember Bonta, voted to put these pro-housing policies in place and — with Governor Newsom’s signatures — to have said state bureaucrats implement these pro-housing policies.

  5. “In the best of all worlds, we’d hope that the will of local voters would prevail over the wisdom (or whims) of state bureaucrats.” … or City bureaucrats? What would happen if Alameda were to insist that your arguments are valid and adopt the implications as policy? I guess Mr. T is saying that HCD will reject the Housing Element, but then what, does Alameda then try to sue the HCD? How much would that cost and what is the most likely outcome?

  6. Paul Foreman says:

    Thank you for an excellent discussion of the issue of whether or not upzoning of R-3 through R-6 is needed to obtain a certified housing element from HCD. A point that is not made in the article is that
    the issue of whether the position of ACT and AAPS that upzoning is not required can be easily tested with zero negative consequences for the city.
    In May City Council must approve a draft of the Housing Element and submit it to HCD. If a majority of Council is so inclined it can submit a draft that does not upzone R-3 to R-6. HCD is then required by law to review the draft and submit any comments by July. The Planning Board
    then has August and September to review any issues with the draft noted by HCD and submit a revised draft to Council if necessary in October. Council then has November and December to approve a revised draft for final submission to HCD if needed.
    The bottom line of the above is that at this point of time, whether or not to upzone R-3 thru R-6 is a policy decision of Council not a mandate from HCD. If HCD rejects the draft and insists on the up zoning, the city would very likely revise the housing element to satisfy HCD, but unless and until that happens Council has the opportunity to preserve the current zoning and express the will of the voters when they rejected the repeal of Article 26 last November.

  7. James Hudkins says:

    When the government tries to fix something they tend to make it worse. Cut the size of government and de-fund the public sector. All else will fall into place.

  8. Common Sense says:

    As we head into a three year recession and stagflation, fewer than 5% of California cities have complied/been approved after submitting their housing element. The threat of being sued is overblown- especially in an election year. No cities have been taken over by the state. The idea of spreading low cost housing into every neighborhood regardless of the availability of space, electricity, water and public consent is truly idiotic as are the politicians and bureaucrats who mindlessly push these deeply destructive and unsustainable policies. Newsflash-more people leaving high tax and regulation California than coming in, and with higher interest rates the housing market is being exploited by corporations buying up single family homes with all cash offers creating a nation of renters. The only real question: Is this the market and the results they intended to create?

    • Observer says:

      It sounds like your effort would be better spent combating these corporations snagging up single family homes instead of the state trying to promote more affordable homes. I agree.

  9. Fernside Freeway Rez says:

    So 800-1600 additional cars coming down High Street and Park Street from South Shore each day? Or say 6,000 – 12,000 more cars trying to find parking or get on/off the island? How? How will this work? If each unit had just one kid we’d have 6,000 more kids … where are the schools, parks, pools, basketball courts, softball fields, baseball fields, soccer fields? I don’t understand how this is sustainable. It’s already miserable sometimes trying to fight one’s way on/off the island. We parked 8 blocks from Park Street the other day to get to the doctor’s office. I’m baffled.

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