That the City Council approve the 2021-2029 Draft Housing Element (6th Cycle) and authorize staff to forward the Draft Housing Element to the California Department of Housing and Community Development (HCD) for review and comment.

CEQA:
This project is exempt from the California Environmental Quality Act pursuant to section 15061(b)(3) of the CEQA guidelines.

Each city and county in California, including a charter city, is required to adopt a General Plan. The General Plan is a comprehensive, long-term plan for the development of a city; it is at the top of a city’s or county’s land use regulation hierarchy.  The General Plan consists of seven mandatory elements and any optional elements that the local government chooses to adopt.  One of the seven mandatory elements is a Housing Element. The detailed statutory requirements for preparing a Housing Element are codified in the California Government Code, Sections 65580 to 65589. As stated therein, the Housing Element must contain an identification and analysis of its existing and projected housing needs.  A Housing Element must also be consistent with the entire General Plan and its preparation must also include public participation.  The City’s Housing Element covers an eight-year period from 2021 to 2029.

Statutory Requirements
All local governments are required to develop housing programs to meet their "fair share" of existing and future housing needs for all income groups.  The Housing Element must contain proactive goals, policies, and programs to facilitate the development, improvement, and preservation of housing commensurate with their housing need as established by the City, regional government, and the State of California. The "fair share" for La Habra based on the most recent Regional Housing Needs Assessment (RHNA) is 804 units.

The Housing Element must contain five basic parts (Chapters) which include: an Introduction, a Needs Assessment, a Constraints Analysis, a Housing Resources Inventory, and a Housing Plan. The 2014-2021 Housing Element update coincided with the General Plan 2035 update, affording the opportunity to coordinate issues of community growth, land use, housing, and transportation.  The City’s 2021-2029 Housing Element update does not propose changes to the land plan (i.e General Plan Amendments or Zone Changes) articulated in the 2014 General Plan update. The goals, policies, and programs of the 2021-2029 Housing Element are consistent with the goals and policies of all General Plan Elements.  Existing sites designated for housing can accommodate the City’s entire regional housing needs allocation and are consistent with the land use plan in the General Plan, associated Specific Plans, and growth projections in the Environmental Impact Report. 

To satisfy the State's requirements for a "diligent effort " to be made to achieve public participation, the City Council reconstituted the General Plan Advisory Committee (GPAC).  The GPAC is made up of 11 members including representatives from the City Council, Planning Commission, Community Services Commission, the Chamber of Commerce and citizens at large.  Over the course of a year, the GPAC met five times and discussed Housing Element basics, community needs, housing sites, and housing goals, policies and programs. Because of protocols required during the COVID-19 pandemic, all meetings were held via Zoom. 

To inform the GPAC’s deliberations and provide more representative input to guide the update of the Housing Element, 14 additional stakeholders were directly contacted by phone, mail, and email.  These included developers, fair housing agencies, advocacy groups, health care agencies, and local organizations.  These groups played an active role in the GPAC meetings to refine the priorities for the Housing Element.  During the update process the City also created a Housing Element website to inform residents of updates and venues for participation.  Included were PowerPoint presentations to the Advisory Committee, notes and comments from the public for each meeting, planning reference documents, review letters from the California Department of Housing and Community Development (HCD), and other materials germane to the Housing Element update.  Finally, the draft Element was posted on the City's website ten days prior to the Planning Commission meeting and a legal notice was posted in the newspaper, posted outside City Hall, and courtesy notices were emailed to the GPAC members and advocacy groups.  

Draft Housing Element
As noted above, the Draft Housing Element consists of five chapters: 1) Introduction, 2) Community Profile (Needs Assessment), 3) Constraints Analysis, 4) Housing Resources, and 5) Housing Plan.  The information in Chapter 1 is discussed above.  Chapters 2 through 4 contain the analysis and data that forms the basis for Chapter 5, the "Housing Plan."  Chapter 2 identifies and discusses the City's demographics and housing profiles along with special needs and assisted housing.  Chapter 3 analyzes the market constraints, land use policies and fair housing requirements, pursuant to AB 686 in 2019, consistent with the requirement of the Federal Affirmatively Furthering Fair Housing Final Rule.  Please see the attached Draft Housing Element for the in depth discussion of all of these topics.  Chapter 4 addresses the Regional Housing Needs Assessment (RHNA), provides an inventory of sites suitable for providing housing to meet the RHNA requirements, and the sources available to implement the proposed housing programs in Chapter 5.

The RHNA allocation is a State-mandated process that determines the amount of future housing growth that each city must plan for in their Housing Elements.  This process seeks to ensure that each jurisdiction accepts responsibility for the housing needs not only its resident population, but also for its projected "fair share" of regional housing growth. The 2021-2029 RHNA process began with the Department of Housing and Community Development’s projection of Statewide housing growth based on population projections from the California Department of Finance.  HCD is responsible for the apportionment of the Statewide needs to Regional Councils of Governments.  For this present Housing Element cycle, the Southern California region has been allocated a total of 1.34 million housing units. The Southern California Association of Governments (SCAG) is designated as our region's Council of Government, and in that capacity, developed a methodology to allocate, by income level, the region’s share of Statewide needs to individual cities.  La Habra's allocation of 804 housing units is shown in table HE-4.1

Housing Sites Inventory
It is important to note that local governments are not required to build housing or financially subsidize for development of new housing; however, cities are responsible for ensuring that adequate sites are available during the planning period that are suitable for housing to be built at the affordability levels of the RHNA.  State law allows cities to use the following strategies to address the RHNA:

Credits
The City has approved and entitled residential projects that are anticipated to be built and receive their certificate of occupancy after July 1, 2021, during the 6th-cycle planning period.  These include condominiums, single-family homes, apartments, and mixed-use and live-work condominium units. These units are affordable to lower, moderate, and above moderate income households.  Table HE-4.2 lists projects that are approved, pending, or proposed that will be developed after July 1, 2021, during the Housing Element planning period.

Accessory dwellings are a key strategy for the City to meet its share of the region’s housing needs for low and moderate income households.  ADUs are an attractive housing option in La Habra, particularly for households seeking to augment their income or provide housing for family members.  ADUs can provide housing options for family or extended family members, seniors, or students and are permitted in any zone where single-family or residential multi-family dwelling uses are allowed or as part of any proposed residential development. 

The City has witnessed a significant increase in ADU production in recent years, with the number of ADU permits growing from five permits in 2018 and 2019 to more than 40 permits for 2020.  In 2020, the City updated its ADU ordinances to reflect more permissive regulations allowed in State law (Ordinance 1813).  In 2021, the pace of ADU applications has continued to increase as homeowners realize the opportunity for these units and, based on data from the first quarter of 2021, staff anticipates an average of 50 ADUs may be permitted annually through 2029.  

Potential Housing Sites
The 2014 General Plan established the vision for La Habra and the land use designations necessary to accommodate a range of housing types and products.  It is recognized that the majority of new housing will be developed on underutilized corridor sites, underperforming or obsolete retail and industrial sites, and other areas.  Based on the General Plan build out in 2014, the General Plan created development capacity for more than 5,000 units through the build out of the City.  While sufficient development capacity exists to address its overall RHNA number of 804 units, it is recognized that new multiple family housing and mixed uses will be developed incrementally, starting with the most feasible sites, then proceeding to more difficult sites. To that end, the City carefully reviewed parcels and selected only the parcels that were most likely for development during the 2021 to 2029 time frame.  Sites were included that met at least five criteria:

Combined with the credits identified above, 23 sites have been identified in table HE-4-5 (see attached housing element) to address the City's 2021-2029 RHNA numbers.
 

Summary of RHNA Compliance
As summarized in the prior analysis and below, the City of La Habra’s strategy for addressing its 2021-2029 RHNA requirement takes into account three credits: 1) approved and pending projects; 2) accessory dwelling units; and 3) vacant and underutilized sites that can accommodate the RHNA.

The surplus is intended to address the no net loss provisions of State Housing Element Law.  To ensure that sites are available at all times during the planning period, as required under State law, the Housing Plan contains a program for monitoring progress (including the construction of ADUs) made toward the RHNA and committing to adjustments in the land inventory should a shortfall in sites occur.

GOAL HE-1: HOUSING AND NEIGHBORHOOD QUALITY
Well-maintained housing in decent, safe, and sanitary condition and quality neighborhoods, where adequate public facilities, infrastructure, and services are provided, and the quality of life is protected from encroachment of other uses or environmental hazards.

GOAL HE-2: HOUSING OPPORTUNITIES
Well-designed housing opportunities throughout the city that are diverse in type, tenure, location, and affordability levels; that minimize environmental health hazards and incompatible land uses; and that enhance the quality of life for residents. 

GOAL HE-3: PROVISION OF AFFORDABLE HOUSING
Assist in the development, provision, and retention of long-term affordable housing opportunities for extremely low, very low, low, and moderate-income households, including individuals and families with special needs.

GOAL HE-4: AFFIRMATIVELY FURTHER FAIR HOUSING
Ensure housing opportunities are available to all without regard to race, color, ancestry, national origin, religion, marital status, familial status, age, gender, disability, source of income, sexual orientation, military status, or other arbitrary factors.

CONCLUSION
In summary, staff believes that the Draft Housing Element prepared with the input and guidance of the General Plan Advisory Committee (GPAC) and the public, provides for the housing need of the current and future residents of La Habra and complies with all the applicable State laws and requirements.

The Planning Commission reviewed the draft Housing Element at its regularly scheduled meeting on July 26, 2021.  Commissioners Munoz and Bernier had excused absences.  After the presentation of the staff report by Mr. Woodie Tescher of PlaceWorks, the Chair opened the hearing for public comment. Commission discussion centered on the use of Accessory Dwelling Units (ADU) as part of the strategy for meeting the City's RHNA numbers.  Commissioners expressed concern that the 400 ADUs projected to occur during the next eight years was unrealistically high and that HCD would reject the City's draft Housing Element.  Deputy Director Ramsland noted that recent changes to State law made it easier for property owners to build ADUs and that staff believed that this number was feasible. 

There was also discussion regarding the proportionality between the level of ADUs vs. the overall RHNA numbers. Mr. Tescher said that it is an ambitious number for ADUs as a percentage of the total; however, there was flexibility based on the numbers in the other categories giving the City potential credits.  Furthermore, a discussion occurred about Table 4-5 which identifies all the current and potential multiple family developments, totaling 820 dwelling units, that are proposed to meet the RHNA numbers.  Deputy Director Ramsland added that there are other sites that developers have shown interest in that were not included in the lists of potential sites and that staff could make adjustments to the table in the future by adding additional sites in the event HCD raises concerns.

The Commission approved a resolution recommending that the City Council direct staff to send the Draft Housing Element to HCD for review and comment.