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1981/02/1881-249 City Hall, Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. The City Council of the City of Anaheim met in adjourned regular session. PRESENT: ABSENT: PRESENT: ABSENT: PRESENT: COUNCIL MEMBERS: Overholt, Kaywood, Bay, Roth and Seymour COUNCIL MEMBERS: None PLANNING COMMISSIONERS: Fry, King, Barnes, Bushore, Bouas and Herbst PLANNING COMMISSIONERS: Tolar ASSISTANT CITY MANAGER: William T. Hopkins CITY ATTORNEY: William P. Hopkins CITY CLERK: Linda D. Roberts EXECUTIVE DIRECTOR OF COMMUNITY DEVELOPMENT: Norman J. Priest PLANNING DIRECTOR: Ronald L. Thompson HOUSING MANAGER: LiBa Stipkovich ASSISTANT DIRECTOR FOR ZONING: Annika Santalahti JOINT COUNCIL/COMMISSION WORK SESSION - AFFORDABLE HOUSING AND RM-3000 STANDARDS: Mayor Seymour welcomed all those in attendance and briefed the Chamber audience on the discussion to take place, as well as the procedure to be followed. Acting Chairman of the Planning Commission, Gerald Bushore, called the Planning Commission to order. Mr. Norm Priest, Executive Director of Community Development, first stated that they looked to the Council and Planning Cor~aission for policy guidance. He did not believe there were specific answers, but they had given their best thinking on the matters at hand. His comments would be in two areas, the first being affordable housing. Secondly, Mr. Ron Thompson would speak more directly rela- tive to proposed amendments to the Zoning Code of the City, as well as to the issue of rental conversion to condominiums. Before proceeding, Mr. Priest felt it would be fruitful first to define some of the terms that were going to be used. He thereupon explained the definitions of affordable housing, fair share, and very low income (see pages 3 and 4 of staff report dated February 13, 1981-- subject: Joint Council/Commission Work Session, February 18, 1981, from the Community Development Department/Planning Department--on file in the City Clerk's office--which contained staff recommendations and all data gathered for the pur- pose of the work session). He then explained that in the last number of months, affordable housing had been recognized across the nation as one of the major problems they now faced considering inflation and the tremendous increases in housing costs. They had been required to determine how ~hey could assist devel- opers in building new housing so that it could be presented to the purchaser at an affordable level. As part of the package submitted, they had outlined a number of items and one of particular interest in dealing with affordable housing was Table No. 5 (see Table No. 5--Affordable Housing Comparision--primarily Southern California) listing 20 jurisdictions summarizing for easy comparsion those who had inclusionary zoning, granted density bonuses and/or variances, those where affordable housing was already built and/or proposed and those where density had been approved on affordable housing. The range of sale prices were also listed. Mr. Priest continued that one of the techniques that had been used to provide affordable housing was to grant a density bonus, such a bonus being a right or privilege offered to a developer to grant additional density in units per acre over and above ~hat permitted by Code if that developer agreed to provide at 81-250 City Hall~ Ana.heim, California - COUNCIL MINUTES - February 18~ 1981~ 7:00 P.M. least 25% of his project in the affordable ranges mentioned earlier. Another technique was to grant variances for parking, floor space and recreational area. Inclusionary zoning in a limited number of jurisdictions and Orange County was one of those had also been proposed in all such new developments. Before the Council tonight were two recommendations with regard to affordable housing (see Page 1 of the February 13, 1981 report--1. A. and B.). They had become aware as they worked with developers that there was a great deal of con- fusion among them in several areas. They were not entirely clear as to the policy of the City~ This caused staff in meeting with the developer to spend a considerable amount of time looking over their development and doing their best to analyze it before it was presented to the Planning Commission. Overall, however, there had not been and presently there was no clear guideline as to what they should advise those developers. First and moss importantly as an end result to this workshop and possibly others, would be for the Council and Planning Commission to adopt a policy to allow for specific density bonuses and other bonuses such as parking reductions. In both instances, they were talking about the median income level. They were suggesting that the developer could, by providing 25% affordability, obtain a density bonus. The second element or recommendation would be that in the case of such developments, that consideration be given to adopting a policy to establish a sliding scale method of resale control for affordable units that received a density bonus and other bonuses, not including a direct financial contribution. An issue was before the Council two weeks ago on AB ll51 which dealt with 30- year resale price controls. They were talking about those incentives that did not include a direct financial contribution. He then briefed Page 11 of the staff report titled--Suggested Resale Controls For Density Bonus and Other Bonuses Not Including A Direct Financial Contribution. He pointed out that most of the differences listed were between the area of $1,000 and $15,000 or a suggested time period for resale controls of one to nine years. In concluding, Mr. Priest repeated the recommendations of staff as follows: "Adopt a policy to allow for specific density bonuses and other bonuses such as parking reduc- tions, when a developer agrees to build 25% of a development in the affordable range with 10% affordable to households at 100% of the median, 15% affordable to households at 120% of median; adopt a policy to establish the sliding scale method of resale control for affordable units that receive a density bonus and other bonuses not including a direct financial contribution." Mr. Priest then suggested that they might want to proceed with the additional recommendations (see 2. A., B. and C., Page 1--February 13, 1981 report) rela- tive to proposed amendments So the RM-3000 standards because the two tended to tie together. Councilman Bay stated before discussing the RM-3000 standards, an important point involved in the foregoing recommendation of which the public should be aware, was the fact that there was a State law mandating that when a developer provided 25% of his project as affordable, under that law, he had the right to certain density bonuses; both City Attorney Hopkins and Mr. Priest confirmed that was correct. Mayor Seymour asked, given the City's current standards of development, at what price was it possible to build affordable housing in the community given the 25% factor in the new law? 81-251 City Hall, Ana.h~i~,. California -..COUNCIL MINUTES - February 18~ 1981~ 7:00 P..M. Mr. Priest answered that he felt there were instances where it could be done. At the same time, however, within the standards or following the exact provisions of the law, they were severely limited. Mr. Ron Thompson, Planning Director, explained that the site development stan- dards were a very important part of the equation, but, in addition, there was the cost and availability of money, inflation and many unrelated factors that were contributing to the housing crisis. Most of the developers they talked to today, given the high value of land and all of the other factors, were losing the ability they once had to provide a wide range and variety of affordable housing, and the "American dream" of home ownership was fast fading. Mayor Seymour asked, in his professional opinion, of all the vacant land in the City if they were to apply the City's zoning as it applied to that land, i.e., their current site development standards, and given the parameters of ABll51, what percentage of the undeveloped land in the City for residential purposes could be developed as affordable; Mr. Thompson answered it would be a small percentage. Councilman Bay interjected and stated it would depend on the going interest rate of the particular year which would affect the financing. He did not believe it was a fair question to generalize to that extent. Mayor Seymour asked then at a 20% borrowing rate, 15% or 10% rate, what might the answer be. Mr. Thompson answered that the projects they were seeing in the Planning Depart- ment were ranging upward to 50% over what the City's current Code RM-3000 pro- vided for. With a 20% or 15% interest rate, they did not anticipate receiving very many requests, but should that rate fall to a more reasonable level of 12% or 13%, he felt that would provide an opportunity. Mr. Priest stated looking at the sales prices on those affordable projects which had been approved to date, the price tag was in the $55,000, $57,000, $59,000 range. Brookhurst Gardens, a 25% bonus, was such an example although that was a condominium conversion. Cinnamon Hollow represented a 68% bonus and there was a $57,000 price tag on those units. He then referred to Table 4 of the subject report--Comparison of Affordable Projects in Anaheim, and briefed the Council and Planning Commission on a portion of that summary. Mayor Seymour asked how the income levels previously mentioned converted to prices of the units, how they related to a monthly payment or income. Mr. Lisa Stipkovich, Housing Manager, stated that they were using a 12% interest rate and 30% of the monthly income as a guideline for shelter costs, including principal, interest and taxes. Councilman Roth asked Mr. Priest, in the applications they had been receiving from developers who wanted to provide affordable housing, was the main thrust density, rather than any other type of variance. Mr. Priest deferred, to Miss Santalahti; Miss Annika Santalahti, Assistant Dir- ector for Zoning, stated that the critical factor was the density and the other was the recreational space requirement. She reiterated, density was the critical issue. 81-252 City Hall~ Anaheim,. California - COUNCIL MINUTES - February 18~ 1981, 7:00 P.M. Councilman Bay noted in reviewing Table 4 relative to the varying density bonuses ranging from 25% to 144%, he did not see the sales prices running linear to the density bonus at all. Thus, there were definitely other factors involved. Mr. Thompson explained that as the Council and the Commission would recall, when Anaheim adopted its first General Plan, some two decades ago, one of the primary goals was to provide a broad range and variety of housing in the community. To date they had done very well in that goal. Approximately 45% of the City's dwelling units were single family, 6% were in mobilehomes, 6% in condominiums, and 43% in apartments. In the iasc several months, the Planning Commission and the Council, as well as the citizens and developers, had been discussing the housing issue with both the Con~nunity Development and Planning Departments. Concern had been raised with respect to certain of the City's site development standards. Over the last few months, many waivers had been sought by develop- ers and granted by either the Planning Commission or City Council. That, along with the contact they had with the development industry, led them to come to the conclusion that the site development standards might be antiquated, especially giventhe change in family composition they were experiencing and the fact that much of the housing supply in the future might well be in apartments and condo- miniums rather than single-family homes on large lots just because of the sheer cost of land, the financing, availability of money and the actual building of the home. The Planning Department had surveyed all of the other Orange County cities to learn of their standards and also selected some of the more recent condominium developments both in and out of Anaheim to ascertain certain basic factors such as how many people were presently living in condominiums. (See report February 13, 1981, Table 1, two pages, Comparison of Site Development Standards For Residential Condominiums and Townhouse Development in Orange County--and Table 2--Comparison of Parking Requirements--Table 3--January 1981 Condominium Parking Survey). With the type of condominiums they were seeing built today, the parking requirements appeared to be substantially less ~han what the RM-3000 zone provided for. Based on their in-depth analysis of the surveys they had made, they were proposing three recommendations that would appear to provide a somewhat greater density in those areas that might be suitable for condominium zoning: "Increase the maximum density by allowing gross land area instead of net land area to be the basis for the density calculations; allow bachelor/studio units (not to exceed 20% of the overall project and to have minimum floor areas of 550 sq. ft.); decrease the parking standard to a minimum of 2.5 parking spaces (down from 3.5) per unit, provided, however, that bachelor/studio units (if permitted) may have a minimum of 2.0 parking spaces. Elaborating upon the recommendations, Mr. Thompson pointed out that the density was now ~igured on a net ground area deducting all the vehicular access ways. If they stayed with all the Code standards but considered a gross parcel acreage area rather than deducting the access ways, the density would be increased approximately 25% by the time they added the parking standards, bachelor units and calculating on a gross density basis. Most of the condominiums in Anaheim in the flatland areas would fall in the vicinity of 14 to 14.5 units per acre. If the changes were to be considered appropriate, the Council could an:icipate that the ~ensity would probably increase to approximately 18 per acre primarily dependent upon the types of design involved. 81-253 City Hall, Anaheim~ California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mr. Thompson then spoke to the 150-foot setback for a two story apartment house from residential designed to protect the adjoining single-family residential from visual intrusion and to provide an environment that was necessary in a very highly complex modern society. They also felt there might be instances, however, where three stories may well be appropriate. They foresaw in the future where condominium developments might be more extensively utilized in the hill and canyon area where there were differences in terrain. Rather than developing an arbitrary standard, they felt that either via a CUP or a review of the devel- oper's specific plans, the developer would have to show even though going higher than two stories, he would not be visually intruding on the single-family neigh- borhood and destroying the privacy that set Anaheim apart. If there was concern by the Planning Commission or Council in modifying density upward to provide a greater housing opportunity, they felt a performance standard would be more appropriate and better from an environmental standpoint than picking an arbitrary number. Mr. Thompson continued that there were many people who still desired and pre- ferred to rent. However, with respect to what staff was asking, they felt a Council/Commission policy with regard to condominium conversions would be appropriate in guiding those wishing to convert some of the 35,000 units that were a part of the City's housing inventory. The public should know that when rental units were being converted under today's new financing rules, they could be trading a $300 rental payment for a $700 payment to own their own home, but they were going to be getting no more than a paint and patch-up apartment. There may be those developers who could put together a package where a pro- spective purchaser could buy a converted apartment and end up paying close to the rental fee which might be very desireable from the purchaser's standpoint. However, they had no way at the present time to guide the many people they had discussed those issues with. Any policy direction the Council could provide to the Planning and Community Development Department staff would be most appreciative. Councilwoman Kaywood noted that on the original General Plan, they had a maximum number of people considered for the population of Anaheim. Mr. Thompson acknowledged that was so and stated that in making their recommen- dations, one of their chief concerns was to develop recommendations where they felt they had the infra structure and could serve the increamed density. He pointed out, for instance, that Anaheim, west of the Santa Ana River, was basically 90% plus developed. But with the proposed recommendations they felt in most instances they had the infra structure necessary to accommodate them. However, there may be special areas where they would have to perform an analysis. One area the Council might not be aware of, in the vicinity of Haster and Orange- wood, much of that area had been developed for some time and developed to rather intense residential uses. At the time the area was developed, there was more than adequate infra structure or capacity in the sewers, for example. It would appear that in that area today, because of the change in the number of people living in apartment units, and many of those people might be undocumented, when renting bedrooms to entire families, thus resulting in their using a much greater share of water, the sewers would then begin to back up. That was the type of thing to which a great deal of attention must be paid. If they made mistakes where there was not enough capacity and infra structure, it was going to be 81-254 Qity Hall, Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. very expensive to run paralleling sewer lines and things of that nature, and the community at large would have to pay for those improvements. That was why they did not reco~m~end any greater density increase than they had. He felt a 25% density bonus in the RM-3000 zone was possible to achieve, plus the addi- tional 25% that was mandated under State law. That would not upset the exis- ting infra structure but might allow them to achieve more or a greater housing opportunity for the citizens of the City. Councilwoman Kaywood asked how Mr. Thompson saw the recent California Supreme Court ruling that eliminated the number of people constituting a household affecting the number of families moving into one unit and subsequently a greater number of people living together. Mr. Thompson felt that they would probably move in regardless of that particular legal decision. That was a valid concern and there would be certain pockets in the City where they would experience situations of that nature. He was not certain what they could do about it. However, they were recommending changes to the RM-3000 zone which was basically ownership, rather than rental. After further discussion, Councilman Roth asked Mr. Thompson if he was suggesting that when "X" amount of people were living in a certain area, he would recommend denial of building permits to the Council. Mr. Thompson answered that he would immediately come to the Council with a report pointing out the magnitude and extent of the problem, as well as the specific geographical area involved, and also present alternatives, one of which might be down zoning some of the vacant acreage. The other alternative would be to build paralleling sewers. Councilman Roth stated he would like to receive information from staff as to where such sewer lines might be where they were near capacity. This was the first time he had ever heard that. He noted that the City of Corona controlled growth by not being able to provide certain services and if Anaheim had such problems, he wanted to know the locations. Mayor Seymour emphasized that this was a very sensitive question. Mr. Thompson selected probably the most dense area in the community at Orangewood and Haster and also a section of the community that perhaps had the highest percentage of illegal aliens, if they could ever get a handle on the meaning of that word. He felt it was dangerous to take that instance and apply it City-wide, because it was just not true. The infra structure in all other segments of the com- munity was plentiful and reasonable to met the recommendations being made. Mr. Thompson agreed and stated he was not trying to use a scare tactic. Councilman Roth asked for confirmation that at the present time Anaheim required 3.5 parking spaces per dwelling unit in the RM-3000 Zone and of all the cities in Orange County, Anaheim had the highest s~andard; Mr. Thompson confirmed that was correct. Planning Commissioner Lew Herbst explained how the 3.5 parking spaces came about. When they started building condominiums in the canyon where there was no on- street parking, they found out through surveys that the canyon definitely needed 81-255 City Hall, Anaheim~ q~.lifornia - COUNCIL MINUTES - February 18~ 1981, 7:00 P.M. more parking than 2.5 spaces and they thus went to 3.5 spaces. He would rec- ommend that should remain the same. In the Downtown areas on-street parking was available. The Mayor asked if there were questions from the Planning Commission. Commissioner Gerald Bushore stated that the Commission had been waiting a long time for the ~eeting. He thus urged that they all limit their questions to the specifics and not individually get into their specific recommendations in order to be able to receive input from the public; Commissioner Charlene Barnes agreed. Commissioner Herbst, speaking to Mr. Thompson, asked with regard to the Rede- velopment area,, he assumed there was going to be an upgrading in the sewer system in the Downtown area to accommodate any new buildings in that area. Further, he knew that a high-rise condominium was being proposed in Downtown, but he did not believe that they were addressing that issue at all. He felt their discussion should include, particularly in the Redevelopment area, some- thing with regard to a high-rise condominium development in Downtown and possibly the Stadium area. Mr. Thompson explained that they confined their study primarily to the issues that both he and Mr. Priest addressed. Mr. Herbst stated that he did not want the developers to think the whole ordin- ance would be two stories only. Councilwoman Kaywood stated her concern had been that in the Redevelopment area and others, with proper planning they could go into much higher and denser high-rise type of condominium~ If Downtown were to permit an overabundanCe, as had been approved, they might get to the point where the infrastructure might not be able to handle any of the new developments. She did not want to see that happen. Mr. Priest explained that they had kept in mind the nature of the proposed developments and as the new developments were built they had the opportunity to size the sewers, storm drains, etc.., accordingly. Commissioner Paul King suggested to provide additional housing, why not classify condominiums as homes. He was thinking of the 150-foot setback required for two-story condominiums. If classified as a home, it could be built within the 150-foot required setback. He asked that the Council give consideration to that possibility. The Mayor then opened the meeting to receive input from the public-at-large as to how they felt about what had been discussed thus far and the affordable housing question. The following people then spoke to the issues, and highlights of their presenta- tions are given below: Mr. David DesRoches, 508 South Anthony, Vice Chairman of the Anaheim Youth Commission. Anaheim was an nice place to live and the Council was faced with tremendous responsibilities regarding growth and the commitment to affordable 81-256 City Hall, Anaheim~ California - COUNCIL MINUTES - FebruarM 18, 1981~ 7:00 P.M. housing. That should not overshadow their commitment to the people who were long-term residents of the City. People who lived in the City should be more thoroughly protected by zoning laws aHd building codes than people who would be moving in with affordable housing. Variances and waivers, while perhaps benefitting new residents, would deprive old ones of that certain magic that made Anaheim a special place in which to live. Bending the law would also set a dangerous precedent. He believed he was the youngest person in the room and 25 years from now, once the Code was implemented when the present Council members might no longer be around, if they made a mistake, he would have to live with it. Affordable housing should not take place at the expense of long-time residents and of certain basic living conditions. People should live in Anaheim, but not in tenements. Mayor Seymour pointed out that what they had been talking about relative to providing housing was not for some outsider. He then explained the criteria used by the Housing staff relative to affordable housing which first gave preference to someone already a citizen of the community. They were, in fact, concerned with the next generation and where they were going to house people in his (DesRoches') age group. In concluding and in answer to the Mayor's query Of where a middle ground might be, Mr. DesRoches stated that he would not like to see minimum parking waivers granted in areas where there were schools, churches, and in any area where there was a great deal of public driving. He would not like to see minimum density bonuses granted around areas where people tended to speed. He would like to see storm drains constructed in all areas that would be receiving run-off from apart- ments and condominiums, such as the project proposed at Cerritos and Euclid. He reiterated that they should keep the interests of long-term Anaheim resi- dents in mind in their decisions. After Mr. DesRoches' presentation, the Mayor stated that they needed his involve- ment and they wished that the entire Youth Commission was present tonight. He advised him as Vice Chairman of that Commission to get them involved and devise some intelligent alternates to the problem. Mrs. Rita Ray, 1927 Chateau. She first recounted the fact that she had been present at a recent Council meeting (see minutes of February 3, 1981 under public hearing on Reclassification No. 80-81-17 and Variance No. 3176) where she also gave input as to her solutions for solving the housing shortage. She then elaborated upon the extensive research she had done with regard to the housing situation and also read excerpts from different articles involved in that research. There was room for more people in California, and they did not all have ~o be in Anaheim. Density seemed to be the solution favored by the Planning Commission and Council, since it had been approved in all eight projects that she knew of. She felt what the City of Anaheim had been doing thus far was just a big "rip-off", providing speculators and developers a chance to make a bigger profit without actually providing housing for the people who were in the 80% median income bracket. She heard 100% and 120% quite a bit tonight, but she was under the impression what SCAG wanted was 80%. They would find that the citizens of Anaheim did not want high density developments with numerous waivers and variances. They resented SCAG and the Council telling them that they did not have any right to expec~ them to enforce the Building and Zoning Codes. In concluding, she stated that she wanted the government to do what the people of Anaheim wanted th~m to do. 81-257 C. ity Hall~. Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Commissioner Herbst stated that relative to density, the conversions that had been approved thus far had not increased the density of the particular building or area. It was a higher density from the apartment house code to the condomin- ium code, but the density remained the same. It was a misconception that they were allowing higher densities in many areas. It was just a difference of renters vs. owners. After Mrs. Ray's presentation, Councilman Roth briefed the recent Anaheim Economic Development Corporation Report which emphasized the concern of the business community that there was an insufficient supply of affordable housing in the City to accommodate their employees. He (Ro~h) noted that if they could not house those people, the economic well being of the community was going to de- cline. Councilman Overholt stated that he wanted to understand Mrs. Ray's position clearly. He thereupon asked if it was her position that she was opposed to their amending the condominium code, RM-3000, in any way; Mrs. Ray answered "yes," although she did not know that was under consideration. However, she would also have to consider the changes being proposed before making a flat statement. Mayor Seymour recalled that the last time Mrs. Ray spoke to the Council, she indicated she would support or the Council should consider passing rent control as a method of alleviating the hardship created. He asked if she still believed that. Mrs. Ray answered that she did not see any other solution as far as rents were concerned. People who were renting had a definite hardship. The Mayor asked if she would favor resale price controls; Mrs. Ray answered "yes". It was conceivable that someone could buy an affordable unit and retain it for only five years and unless there were resale controls, it would no longer be affordable. Mr. John Ingalls, 1242 West Lincoln, realtor and mobilehome dealer and Director of the State of California Manufactured Housing Association. He did not think anyone had the answer to some of the statements he heard. There was truth to the statement that manufactured housing could be built cheaper. Being able to put such housing on the land represented the cost factor. Consideration should be given from the municipal level to a cooperative area, perhaps City-owned sur- plus land, where the developer could work together with the City relative to the land to make the homes affordable, giving them credit in their projects in other areas of the City with regard to the inclusionary zoning problem. Young people with good salaries could not afford to buy a home in the medium price range of $80,000 to $85,000, but they could afford manufactured housing if they had a break relative to land costs. He asked that they give consideration to an area where young people could raise children and have a starter home even if subsi- dized by City or Federal grant money or whatever. He looked to a project that could be put together if the developer and the City would cooperate and take some of the brunt away from the developer and their inclusionary problems. He urged the Planning Commission and Council to give SB1960 due consideration when it came up in July and that they do ali that they could in looking towards manu- factured housing as far as condominiums, townhouses, single family dwellings etc., were concerned in considering affordable housing. 81-258 City Hall, Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mr. Ingalls then clarified questions posed by Councilwoman Kaywood relative to the price of manufactured housing and if they were being built in two stories. (A photograph was submitted by Mr. Ingalls of a two-story factory built condo- minium and also a single family home). Councilman Bay stated if manufactured homes were starting to go up in height, that might well be the answer. The technology advances in producing a home that Mr. Ingalls was speaking about, was one of the answers to overall home costs; however, it would not solve the land costs. Councilman Overholt agreed that manufactured housing offered many advantages, but the big question revolved around where they would be located. He asked Mr. Ingalls if it was his suggestion that they be permitted indiscriminately throughout the City both single-family and multiple units (manufactured vs. stick housing). Mr. Ingalls felt they should go anywhere that a stick built home was constructed and in most cases, the manufactured home would upgrade the community. Mayor Seymour noted that Mr. Augie Lopez was present and Mr. Lopez had built a manufactured home on a surplus City-owned lot which he (Lopez) had purchased. (Seymour) had visited the site and talked to some of the neighbors in the vicinity who were at first apprehensive, but it evolved that everyone was happy with the outcome. Mr. Augie Lopez, Real Estate Broker, reported that the first two such houses they built in Anaheim were built on surplus lots and they also had built some in Fullerton. One in Anaheim sold for $99,000, but it had air conditioning and many upgrades. The value of the other property in that neighborhood was approx- imately $82,000. Mr. David Boyd, 1329 Ashington Lane. He was in the second mortgage business and had actively appraised real estate in the general area for the past 18 years. He was in favor of affordable housing, but they should approach it from the problem of Orange County as compared to the City of ~Anaheim. Being one of the oldest cities in Orange County, Anaheim provided the affordable housing for the County. He heard a percentage that 93% of the land on the west side of the river had already been developed. For what little land that was left, they must provide the housing they did not have now. They needed nice condominiums. They should be very careful as to how they used the remaining part of the land that was available. Mr. Philip Bettencourt, Orange County Chapter of the Building Industry A~sociation (BIA) of the Southern California, representing some 650 member companies in Orange County. The whole topic of affordable housing was of vital concern to them as housing producers. Relative to the RM-3000 development standards package rec- ommended by staff, that Code needed to be modernized regardless of the afford- ability issue. The City's current standards for that zone were far more re- strictive and the City was out of touch with its fellow municipal jurisdictions so far as the densities and development standards under that Code were concerned. Density and parking standards were the two biggest non-government subsidized in- centives to improve housing affordability because they dealt with a non-renewable resource--land. The talk about high density or the allusion that somehow re- markably high density would be permitted under the development standards as 81-259 City Hall, Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. proposed was purely irresponsible. The current General Plan limitations when developing under that Code had already effectively limited for non-vartanced applications and did not even give an opportunity to develop at the full 18 units per acre that would be the maximum permitted density under the law under the low-medium residential already, particularly because of the way in which the street surface was calculated and because of the requirement for the amount of space that had to be devoted on site for each individual unit. He then submitted a calculation which showed for a non-variance application to develop in the City's existing low/medium areas, the actual effective gross density permitted now was, in fact, not 18 units per acre, but 12.65 units per acre and that was too low. (see sheet submitted--City of Anaheim--density for low/medium residential developments--on file in the City Clerk's office) They should also not lose sight of the State mandate under ABllS1, the fact being if a developer came forward and agreed to provide units that met the affordability definition of the law, they were honor bound, except under some severe health and safety circumstances, to accommodate that 25% density bonus. Relative to the infrastructure overloading argument, unless there was more specific evidence, those kinds of things stirred up fears in the community that somehow accommodating affordable housing opportunities in terms of the City's total housing stock and in terms of the exemplary track record the City had in providing for its infrastructure through the years was just an irresponsible argument and they did not believe it. There were no sewer and water capacity problems in the City to begin with, and there were none that were going to be exaggerated by the sum of 300 affordable units that had been approved thus far. Mr. Bettencourt also stated the Council should consider price controls. The County of Orange 25% inclusionary housing requirement, to comply with that, did not set prices. The County plan mandated that units be sold to persons meeting the affordable definition. He then relayed other statistics relative to the types of people who were shopping the new home subdivisions in the County, 41% of which did not have children. He also elaborated upon the great amount of money that was necessary in order to be able to purchase a home in the afford- able range. He then submitted a sheet entitled--Income required to qualify for average new attached or detached home (on file in the City Clerk's office). Councilwoman Kaywood noted that Mr. Bettencourt mentioned not to consider time on price controls. She was curious to know, mhen it was mandated that the units be sold to persons meeting certain income levels, if the seller wanted a higher down payment, what would happen if the buyer could not meet that level? Mr. Bettencourt then explained what occurred under the County's program, during which he stated that they did record resale controls if it was at the developer's request. They called it a first buyer speculation control. They did not want anyone making the so-called windfall profit as well, but that could be handled with a five-year so-called tandem trust deed without getting into the whole market mechanism of going over a 30-year period. They were talking about five years relative to the first buyer. The County under their mortgage revenues bond program was talking about 30 years. Councilwoman Kaywood noted it was interesting that only the two figures of five years and 30 years were pulled out of the air, since there was a great deal in between. 81-260 City Hall~ Anaheim~ California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mr. Bettencourt stated that the view of the industry was that the five-year period did provide some mechanism to insure that they were serving the objec- tives. They still had to be sold to persons meeting the income objectives so that there was no quarrel that they were going initially to the right people, but if there was not that five-year control, the temptation would be over- whelming and thus the five years was some level of control. Councilwoman Kaywood then asked what would happen on the 6th year--would they still have to sell to someone meeting a certain income level? Mr. Bettencourt stated in the County, the Housing Authority held the first right of refusal to repurchase the unit at an agreed price. He reiterated, however, that under their view, the five-year period was adequate. If there was no subsidy involved, the owner should have a chance to sell the unit just as anyone else. Councilwoman Kaywood then questioned what would happen to the affordable housing stock; Mr. Bettencourt answered under the County program, the inclusionary housing program would s~ill be in effect, the theory being if it was still in effect, that new affordable housing stock was being produced each year. Further discussion followed between Councilwoman Kaywood and Mr. Bettencourt at the conclusion of which, he (Bettencourt) stated they did no~ believe that affordable housing under the definitions of the existing Code could be devel- oped in the free land market in the City because it would not attract investors at those low densities. They were not talking about whether or not the City's General Plan ought to be amended. That was another whole issue. They were talking about developing a Code that would offer an opportunity for the full entitlements that were granted by the City's General Plan at present in the low-medium density areas, that being 18 units to the acre. Discussion and questioning then followed between Councilman Roth and Mr. Bettencourt during which Councilman Roth read some statements from various articles relative to the subject matter, asking if he agreed with those statements or not. His last question to Mr. Bettencourt revolved around the staff report. Realizing that the City's development standards in the RM-3000 Zone were more restrictive than all the other cities in the County, he asked if that would lead ~o developers coming in and asking for more variances. Mr. Bettencourt answered that it poisoned the waters" for every legitimate project that wen~ before the Planning Commission because it had to have variances and that set a bad precedent with the public, because they imagined it was a cheapening and compromising of s~andards, when, in actualipy, that was not the case at all. The standards were just plain "tough" and did not deal fully with the unique realities of the time. Mr. Leonard Lawicki, 1676 Ord Way, realtor in Anaheim. He was concerned where his and everyone's children would live. They had to address themselves to meeting and joining forces with developers and builders, and the community, as such, demanded that the Council or City agencies address the problem more seriously. He did not ~hink that the developers were out trying to run through the community at a profit and expense to the general public. They had come to 81-261 City Hall~ .Anaheim,. California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. a crossroads at this point in time where responsible people in industry and in City government must come together to seek out some of the basic problems as discussed earlier. Concessions had to be made and they had to rise to a greater need and eliminate the emotional aspects discussed. Councilman Bay asked Mr. Lawicki in looking at the great change in the market- place on homes, specifically in Anaheim, and the inflated prices, did he think that the market change was caused primarily by the economics, inflation and interest rates or that the main changes were the cost of building and the land? Mr. Lawicki answered, he would probably find that the great restrictions in the ability to build by the government bodies had restricted and caused a spiraling in cost of construction; however, there were too many variables to address. Mayor Seymour stated he could give a very direct answer. In 1979 interest rates ranged from 9½% to 10~%. During that year, the average price of a home rose 25%. Councilman Bay stated what he was leading up to, when talking about easing up on standards from the government's standpoint so that building could take place that would increase the density, build more on the land that was left, was Mr. Lawicki talking about all of Anaheim or just the flatlands. Mr. Lawicki answered that he was addressing the City am a whole. Councilman Overholt, referring to a point made by Mr. Lawicki in his presen- tation, noted that he had said affordable housing was a first time buyer con- cept. He asked if everybody agreed with that; Mr. Lawicki answered, in his opinion, that was what affordable housing was all about. Councilman Overholt stated if that was the case, and if they adopted the afford- able housing concept, would they be locking themselves into that concept. Pre- viously Mr. Bettencourt agreed there should be a five-year restraint, but he would ask both Mr. Lawicki and Mr. Betten¢ourt where they would be ten years from now. mr. Lawicki stated he did not know what the variables would be. With the in- crease in population and the shortages that prevailed, he could not see that it would get much better except for 'the rehabilitation of areas that were becoming obsolescent economically. They had to take steps and work toward the goal of solving the problem rather than limiting the size of construction and adhering to the old zoning and restrictions. After additional discussion between Councilwoman Kaywood and Mr. Lawicki, the Mayor stated what they had received from staff were recommendations which, if adopted, would not exceed the projections in the General Plan. They were talking about a new look as to how they could get to what they already agreed upon. What they were admitting to was, that over a period of time and for good reason, they adopted more and more remtrictive ordinances in relationship to that General Plan.~ They were not talking about increasing the density and population called for in the General Plan or putting a greater burden on the infra structure. 81-262 City Hall~ Anaheim,. California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Commissioner Herbst left the Council Chambers. (10:07 P.M.) Mr. Kent Boydston, stated he just bought his first house in Anaheim at 859 South Claudina and him parents co-signed on the loan. He wanted the City Council and Planning Commission to work and strive together to establish affordable housing. The people who were going to be buying houses in the next few years were those born and raised in Anaheim. They had ideas and plans for the City and wan~ed to work with the City. He felt they needed affordable housing which might mean higher density, no green belts, etc., but at least people would be able to own their own home whether a condominium, a single detached dwelling or building it with someone else. The younger people wanted those opportunities otherwise they would come to a no-growth situation and even the rich would not be able to afford to live in the City. He felt the Council was doing a good job. He sug§ested, however, that they build tighter and allow more density along with a little less government intervention and restriction and let free enterprise take over again. He then confirmed for Councilman Bay that he sold real estate in Anaheim and also was a student. Councilwoman Kaywood stated by building smaller, tighter and closer, as sug- gested, they would end up with the same price or higher prices, i.e., they would be paying more for less; Mr. Boydston stated it was the job of the Council and Planning Commission as to how they could make housing more afford- able for the people. At this point, Commissioner Bushore stated that the Planning Commission would like to make a recommendation. They would like to ask that unless there was something new and different to be offered, that further public input be post- poned possibly to another time. At some point, they wanted to interact with the Council and then perhaps have the public interact once again. Mayor Seymour stated that although the time was 10:15 p.m. as long as they had the endurance, he was going to persevere relative to public input and then con- clude to some other direction which he would assume would be another session of this type. Mr. Dick Teno, 2565 East Seville. He felt that the situation boiled down to three choices. First that they could look at governmen: control and the re- strictions, such control imposed whether in the form of rent control, price fixing, price holding or whatever now or five or ten years from now; secondly, people could move out of the County, but indumt=y and jobm were local and they Could not be shipping people out of town; and thirdly, there was high density. It was nothing new and it was a concept used right after the war years. In order to again be able to build the 700-, 800- or 900-square foot homes for people moving out and those moving back down, the only answer was high density. He also confirmed for Councilwoman Kaywood tha: he was a realtor and prior to that had been in the banking business for seven years. After Mr. Teno's presentation, Mayor Seymour stated he would be interested, before finalizing the decision, to hear from the business community as to what they were facing relative to the labor market and the transportation problem created by the housing problem. 81-263 City Hall, Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mr. Mike Dietch, attorney, office--18411 South Crenshaw, Suite 422, Torrance. He represented a group of people who owned mobile homes. They had affordable housing and they were the people who would be displaced by high density housing. He represented a group of approximately 65 senior citizens who had lived in Anaheim for 10 to 15 years who at the present time had been served notices of eviction to make way for high density housing. No one had addressed reloca- tion of those people and what would happen to their jobs, the medical facili- ties they frequented in the immediate area, and the fact that they had spent their life savings for their home. Also not addressed was the fact that if the mobile home park was closed, there would be a reduction in their mobile homes ~o a value equal to approximately 20 to 25% of the value they put into their homes. They had expended somewhere between $30,000 and $60,000 in the last two years on those mobile homes and yet the mobile home owners had been served with notice of eviction by the property owner in existence at the time they bought their homes with no prior notice given. They had been denied the righ~ to speak at a previous hearing or having a representative speak. He asked what would happen now and ten years from now to people who had afford- able housing who would be displaced to make way for new people in new so-called affordable housing. He clarified for the Mayor that he represented the tenants of the Westwinds Trailer Park. Councilman Bay noted that Mr. Dietch stated the tenants were not allowed to speak their views at a public hearing, a statement which was of concern to him. Mr. Dietch explained that he was present at a public hearing which took place approximately a month ago (see minutes of Planning Commission, December 1, 1980). At that time, the Chairman of the Planning Commission announced that since thi~ was the third hearing on the subject, all public discussion would be closed and the subject matter would be restricted to arguments and quemtions to the attorney for the developer. He had not attended the two previous meettngm on the matter before :he Planning Commission (see Planning Commission minutes of October 20, November 3 and December 1, 1980). Commissioner Charlene Barnes interjected and stated that everyone who wanted to speak at the other two meetings had an opportunity to do so and she believed that almost everyone in the audience at the last meeting had spoken before. She remembered distinctly that :he Chairman asked if there was anything new and different to add before closing the hearing. She felt they were given ample opportunity to speak and they heard hours and hours of testimony. Mayor Seymour stated that they were going to be hearing the matter on March 10, 1981, and they would permit a full hearing. Mr. Dietch had made his point and raised some very good questions. He challenged him to provide the Council with the best answer that he could at some future date. Councilman Overholt stated the point he felt Mr. Dietch was mRking and the only one that wa~ really relevant was the fact that they may be encouraging more condominium construction to provide affordable housing and in the same action would be destroying, affordable housing of mobile home occupants. He felt that was the only point relevant to the present proceeding. 81-264 City Hall~ Anaheim~ California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mr. Wal~ Forsy~he, real estate broker in Anaheim. He commended s~aff relative to their recommendationm to amend the RM-3000 zoning requirements, but he felt strongly about taking issue with them on the 150-foot setback from residential and residential/agricultural. He agreed with Commismioner Herbst. He found no real difference in condominium-townhouse dwellers and single-family detached home dwellers. In view of ~he fact that 6 to 8% of the developable land west of the river involved in-fill parcels, in moat cases, those were the parcels that were going to be coming before the Planning Commission and Council for affordable houming. The economics of purchasing parcelm in the hill and canyon. area was going to force higher denmity because that was the only way they were going ~o be developed because of the cost of the land. In view of that, a very large percentage of those in-fill parcels west of the river were parcels abutting residential property. They were going to have to look at the 150-foot setback because of that reason. He did not think it was fair to the developers and people who owned the property to not have a set policy but instead to look at those on a case-by-case basis. As Mr. Bettencourt stated, it was time to mod- ernize and not compromise. The 150-foot setback was too restrictive. He did not have the answer but to take every project on a case-by-came basis was asking for trouble. Councilman Bay felt that if the standards were lower, developers were still going to ask for a 30-foot or 50-foot setback and then lower it to the point where they would want five feet. Decreasing the setback was not going to stop the request for variance~ and waivers. Commissioner Paul King stated that 150 feet was acceptable in the "old days", but today land was scarce and every square foot should be utilized to the utmost to provide housing for young people and the elderly. Mayor Seymour then recounted all that had transpired in the past year relative to the question of affordable housing and discussions that had taken place regarding the 150-foot setback to the present. It was because of all that had taken place that they decided to get together to see if they could come up with a new set of rules they could all agree to. They could then start to move in an orderly fashion one more time. It wa~ the pursuit of that goal of unanimity that the present discumsion was taking place. Councilman Bay did not disagree, but the only thing he wanted to warn against was that when they set up a policy he did not want a "rubber ruler". If they reached a point of agreement that modernize the Codes and then they would still look at 8, 10, and 12 variances on every project that came in, they would not have done anything to reach an agreement. Mr. Benjamin Lujan, 1709 We$~ Cris. He first briefed the Council and Commission relative to his background specifically explaining the fact that he had lived in four states since he was a child, noting the reason he and his family had moved. He had been a resident of Anaheim for 13 years and he did not want to live in a crowded environment with 220 units in his backyard with cars parked in residential streets all around him, wi~h an increame in the crime rate and in traffic congestion. He did not have any answers relative to the population crunch they were experiencing in Anaheim. On the other hand, he had four children and questioned if he wam going to have to drive 50 miles to see hi~ children when they left home. He felt they should be able to live somewhere clome by. 81-265 City Hall, Anaheim~ California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Before concluding, Mr. Lujan clarified that the 220-unit project about which he was speaking was the one proposed at Cerritos and Euclid, very close to his home. He was concerned because affordable housing was going to be built in his backyard. (During the discussion, it was confirmed that the project about which Mr. Lujan was speaking was scheduled to be heard by the Council at a public hearing on February 24, 1981 at 7:00 p.m.--Reclassification No. 80-81-13 Conditional Use Permit No. 2119, Tentative Tract No. 11053). At the conclusion of Mr. Lujan's presentation, both Councilman Overholt and the Mayor emphasized that he (Lujan) had described the entire problem with which they were dealing at the hearing. He did not want a higher density on one hand, but on the other, he wanted his children to be able to live nearby. Mr. Jim Sauls, 137 Linden, stated he was a real estate bmoker, but he sold in the San Bernardino-Fontana-Upland area. It was possible to provide affordable housing in Anaheim, but there were only a couple of ways i~ could be done. When market conditions dictated the high price of land, the first way was to increase density and the second was to reduce the size. They did no~ need restrictions on resale and all the government programs. All they needed to do was have free private enterprise. He was 100% in favor of higher density and that would not be a lowering of standards, but an updating of adequate standards for the housing needs of Anaheim's citizens. In the canyon, there was adequate area for all of the high density projects in the world and instead of driving 50 miles to San Bernardino, it would be possible to drive to the canyon in a shorter period of time and to provide affordable housing in Anaheim for the workers who now worked in the City and for those people who had kids on the way up. Mr. Ross Atcheson, owner of property at 923 West Lincoln. Relative to the. 25% bonus, it seemed to be giving a false sales price. Part of the problem could be alleviated by making the whole project lower income housing by re- moving pools, recreation centers, common area maintenance with association fees, etc. Also, the City and State could reduce processing time. Those factors could possibly bring all the costs to all of the housing and such projects down, as well as high density, smaller units, dedication of some of the streets and sidewalks making no common areas and still achieving detached housing. He would like to know wha~ the City government could do to speed up the processing time on new construction. Mr. Jim Orr, 2514 East LaSienna, realtor and travel agent, gave an analogy be- tween housing and the automobile and land to gasoline. If they looked at the situation in that context, they would have an advantage because they were running out of gasoline quicker than land. With government controls, the luxurious car with good mileage had dropped down to 8 or 9 miles to the gallon and was becoming economically infeasible, and fuel had become increasingly expensive just as with land. Smaller cars were being built but it was still possible to travel in them. Reducing the size of the lots was not going to be the answer to housing. There were alternatives in housing which were also be- yond the scope of what the Council could handle at this time. Gasoline was a diminishing quantity just as land, but it was diminishing more rapidly and if they looked at the car as a house in size and saw what was happening to that, he felt they could see what had to happen to the housing industry although it might not be the ultimate answer. 81-266 City Hall~ Anaheim, California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. Mrs. Clara Simpson, 935 South Nutwood. She was a housewife and had six children. She was concerned with high density and did not want her children to live in a high density condominium. She realized there was a housing problem but did not think high density was the answer. She was opposed to changing the RM-3000 zone standards. She referred to the two maps posted on the Chambers wall, map A and map B. On the back of map B, it was explained that Anaheim was divided into two areas--Area A and B. Also, it stated among other things that the goal for the Santa Ana Canyon area was to provide for and maintain a safe, attractive and desireable living environment and insure optimu~ health and well being for all residents of the Santa Ana Canyon area of Anaheim. The back of map A was blank. The red pins on map A denoted the affordable projects already approved for the City. The two green pinm were under construct-ion, and they were probably more in the Planning Department awaiting the results of the meeting. The three yellow pins denoted the three school sites recently sold to developers by the School Board. Thus, all of the affordable housing in existence must be in Area A which was already 97% developed according to information given this evening. Most of the residents living in the A area had owned their home for 20 to 30 years, and they protested the high density affordable projects. It was proposed that density be increased 18% in the flatland areas which she assumed was Area A. She questioned if the residents of Anaheim Area B were being asked to make the same unselfish sacrifice and would the Code be changed there as well. If Anaheim must provide affordable housing, it should be at least spread out in less dense areas and not impact one area of the City. Mayor Seymour explained what the staff was reco~nending were standards that would be applied City-wide. He noted she had referred to map B, the City's General Plan. He asked if she found disfavor with that General Plan. Mrs. Simpson answered, not if it included the entire City as a whole. She was opposed to changing the RM-3000 standards. Mayor Seymour stated again it was his understanding that relative to map B, if the plan was carried out with the standards being recommended by staff, that would be what they would get. He reiterated if the standards were implemented they would apply City-wide. Councilwoman Kaywood stated she did not understand if the staff recommendation was approved that they would get map B. Mayor Seymour stated he was referring to the General Plan and it was his under- standing that if the City Council were to adopt staff's recommendations, those recommendations would not exceed what had already been approved density-wise in the City's General Plan. Staff confirmed that was true. Additional discussion followed between several Council Members and Mrs. Simpson with comments by Commissioner Bushore at the conclusion of which, Mayor Seymour stated at this point it would be him recommendation that they meet again as soon as possible on the subject matter. By a consensus of t'he Council and Planning Commission, Thursday, March 5, 1981 at 7:00 p.m., was the date and time met for a continuation of the subject work- shop. 81-267 City Hall~ Anaheim,. California - COUNCIL MINUTES - February 18, 1981, 7:00 P.M. The Mayor asked that staff notify those who spoke tonight and had signed the list provided. ADJOURNMENT - PLANNING COMMISSION: By general consent the City Planning Com- mission adjourned. ADJOURNMENT - CITY COUNCIL: Councilman Bay moved to adjourn. Councilman Overholt seconded the motion. MOTION CARRIED. (11:45 P.M.)