Sonoma housing 2021: A new reality

New rules, streamlined applications, and simplified design standards will radically transform the housing approval process in Sonoma.

 

Looking west at the three-acre Doyle property fronting Napa Road at Fifth Street East, where a proposed 59-unit development may be Sonoma’s next big housing battle.

A preliminary proposal by DeNova homes to annex land into the City of Sonoma and build 59 units on a three-acre parcel at the corner of 5th Street East and Napa Road has prompted scores of neighbors to organize in opposition. Such opposition is not unusual for Sonoma, but development of the so-called “Doyle” property is occurring in circumstances far different than large developments of the past. New state housing laws, implications of the recently passed Urban Growth Boundary, and an urgent housing affordability crisis all come to bear on this proposal, and highlight a new reality for housing in the City of Sonoma.

In order to understand the changes, it’s necessary to review some history of housing policy, particularly affordable housing. Affordable housing is of two types: government regulated (AH) and market regulated (MRH). Government-regulated affordable housing includes various provisions covering levels of rent if rental housing and levels of the sales price if sold, the latter deed-restricted in price for at least 55 years.

In the past, AH was subsidized by the government through the use of redevelopment agency funding; 20% of redevelopment funds were required to be used to facilitate the creation of AH. The State of California eliminated all funding for redevelopment agencies in 2011, and the city did not develop programs to in part replace that funding until 2019 using increased hotel taxes and housing impact fees charged for all types of development. At present, very little has accumulated.

In addition, for the past 30-plus years, the City of Sonoma has operated under the regulation of the Growth Management Ordinance, which limits the average number of housing units built in the city, to 65. For the most part, this ordinance is based on the availability of water and sewer service, and the pace of growth that can be reasonably sustained by existing infrastructure each year.

Over the past 20 years, the actual average number of housing units built has been 27. Each year, property owners desiring to develop their land with housing are granted housing development allocations, up to 20 each year. The Doyle property owner, for example, has received allocations during each of the past three years, as have other property owners, in varying quantities.

In large developments (over five units), the city’s inclusionary requirement mandates that 20 percent of the units be AH. Such housing is measured out in percentages of Sonoma County’s Average Median Income (AMI = approx $70,000/one person household to $102,000/family of four), from extremely low (20%+ AMI) to moderate (80-120% AMI). Most developments are not yet required to include the extremely low and very low categories, only the moderate level, which at times is equal to the market rate.

An important player in local housing development is and has been ABAG, the Association of Bay Area Governments. It has the responsibility for determining the minimum number of housing units, both AH and MRH, that each county and municipality in the Bay Area should strive to see created.

These ABAG Regional Housing Number Allocation (RHNA) targets are revised with new numbers every eight years; the new target proposed for the next eight years beginning in 2021 is around 330 units, a mix of AH at varying income levels and MRH. No upper limit is set by ABAG, only a minimum. Essentially, ABAG requires that land be identified, zoned and available to accommodate their target numbers, not that counties and cities build the actual housing; housing is built by for-profit market-rate developers, non-profit AH developers, and individual property owners, generally not by cities and counties themselves.

Finally, the Urban Growth Boundary (UGB), first passed in 2000 and recently renewed by nearly 80 percent of Sonoma voters for another 20 years, draws a line around the city beyond which development is not allowed, except for 100 percent affordable housing, up to 20 acres over the 20-year lifetime of the UGB. From its inception, the UGB has been intended to preserve Greenbelt and open space by encouraging city-centered growth, infill, and higher densities where water, sewer, and transportation are already in place.

The Doyle property is within the UGB but outside of city limits, thus an annexation application has been made. Simply put, it will be easier to get the development built under city rules than if the land remains subject to County rules.

Clearly, housing creation is complicated. Between California Environmental Quality Act (CEQA) provisions, state law, regional governance, city regulation, and economic market forces, many factors come to bear, and large housing developments like that proposed for the Doyle property take many years. In light of the need for housing, the state recently passed new legislation that seeks to reduce the regulatory burden on developers and create a quicker path to housing approvals and creation. Among this legislation are new rules governing Accessory Dwelling Units (ADU) and California Senate bill 330 (SB-330).

The new ADU rules permit any single family property owner or commercial property owner to construct various types of ADU using a streamlined approval process. Any ADU under 1,000 square foot in size is now essentially permitted unless that unit is on property within the historic zoning district, which then requires that an application come before Sonoma’s Planning Commission.

The streamlining means that approval to construct an ADU requires no public notice or hearings. Conversion of a stand-alone garage into an ADU can be applied for and built quickly, with reduced fees and fast permitting. Such an ADU can be used by the property owner for rental income, or personal use. No additional parking is required for an ADU, even when a garage is converted.

SB-330 carries major implications for housing creation, including some “streamlining” provisions of its own and the redefinition of the ways proposed housing projects are allowed to be evaluated. Formal project applications are now limited to a maximum of five formal public hearings, during which all factors of approval must be evaluated and decisions completed. Historically, large projects have required more than five such hearings; new rules mean fewer opportunities for public input, and reduced modification of proposals.

The evaluation of project applications under SB-330 is also highly significant; the new law mandates that such applications be evaluated using “objective” standards only. Objective standards are those that are quantifiable, such as specific, measurable size limits, setbacks, floor-area to lot size ratios, and the like. “Subjective” standards, such as appearance, style, colors, neighborhood compatibility and so forth are no longer allowed to be considered in project evaluation, except in the Historic Overlay Zone. Based upon this, the city is currently engaged in re-writing its development code to remove all non-objective criteria.

The new ADU rules, streamlining and the objective standard provisions of SB-330 will radically transform the housing approval process in Sonoma; local control has been greatly reduced. Ultimately, the effects of the new rules on the pace, style, and type of housing created remain to be revealed.