Housing Element

Since 1969, Housing Elements have been mandatory portions of general plans and are considered of vital statewide importance by the state legislature. A Housing Element provides an analysis of a community’s housing needs for all income levels and provides strategies to respond to provide for those housing needs. State Law establishes that each city accommodate its fair share of affordable housing as an approach to distributing housing needs throughout the state. State Housing Element law also recognizes that in order for the private sector to address housing needs, local governments must create plans that provide opportunities for, and do not unduly constrain, housing development.

Housing Elements are unique in that they are required to be updated every eight years and are subject to detailed statutory requirements and mandatory review and approval by a State agency — HCD (Department of Housing and Community Development). Rules regarding Housing Elements are found in the California Government Code Sections 65580-65589. 

Based on information collected over the next few months and the land plan being studied in the EIR, a draft the housing element will be prepared for public review. To meet the state mandated deadline, a draft Housing Element must be submitted to HCD by October 15, 2021.

RHNA

A critical component of the Housing Element is the Regional Housing Needs Assessment (RHNA), which is a quantification of future housing needs for all income levels in a jurisdiction. Every jurisdiction must plan for its RHNA allocation. The Southern California Association of Governments (SCAG) is the organization tasked with developing a RHNA allocation plan for the Southern California region. If you would like additional information about RHNA and the Housing Element, please see the following link for tutorials: https://www.occog.com/housing-orange-county

According to the RHNA adopted by SCAG, Fountain Valley must plan to accommodate 4,839 housing units, including 2,093 lower income units, during the 2021-2029 planning period. This includes:

  • 1,307 very low (<50% AMI)
  • 786 low (50-80% AMI)
  • 834 moderate (80-120% AMI)
  • 1,912 above moderate (>120% AMI)
  • OC area median income (AMI): $103K

The Housing Element must identify “adequate sites” and set forth policies and programs that will accommodate the RHNA. Although the City is required to allow for this growth, as well as report to the State annually as to its progress, the City is not required to construct these units itself. That is the role of the private sector.

Although the City submitted many formal opposition letters, supported draft legislation, and submitted a formal appeal of its RHNA allocation, the appeal was denied on January 19, 2021, and SCAG adopted the final RHNA allocation on March 4, 2021. Click HERE for the City’s appeal materials.

At its May 27, 2021, Board meeting, the OCCOG Board of Directors unanimously voted to file a writ of mandate against the California Department of Housing and Community Development. The writ was filed June 21, 2021. Information about OCCOG’S lawsuit vs. HCD can be found at: https://www.occog.com/

Affordable Housing

In broad terms, affordability is simply the relationship between housing costs and income. The generally accepted measure for housing affordability is spending less than 33% of one’s gross household income on housing costs (including utilities, principle and interest). In the context of Housing Elements, affordable housing generally focuses on housing for extremely low, very low, low and moderate income households. In Fountain Valley, those income levels break down as follows:
Affordable Levels in Fountain Valley

  1. Impact of Affordable Housing and Surroundings

In response to concerns that affordable housing could lead to increases in crime and/or lowering of property values in Fountain Valley, please see the following information:  

The biggest takeaway from this research is that: Concentrating large amounts of affordable housing in areas of poverty can lead to lower property values and higher crime rates in those areas of poverty. On the other hand, placing affordable housing in affluent or high opportunity areas, like Fountain Valley, does not lower property values or increase crime rates.

2016 Study on Affordable Housing and Property Values

Summary: 

  • Trulia conducted a comprehensive study of property values near low-income housing developments and found that there was no significant difference in home prices of nearby properties compared with those further away. The study evaluated “3,000 projects financed using the federal low- income housing tax credit program between 1996 and 2006 in 20 of the most expensive U.S. metro areas.  
  • “Trulia researchers measured the change in home values for properties within a 2,000-foot radius of the low-income units as well as an outer ring between 2,000 and 4,000 feet.”  
  • “Across the 20 metro areas, the study found no significant difference in price per square foot when looking at properties closest to the low-income units and those farther out.” 
  • The researchers noted that the impact of low-income housing developments on surrounding property values varies from city to city based on existing poverty levels. 
  • “Large concentrations of low-income units in already-distressed areas will likely cause a deterioration in prices, while a less concentrated approach in more stable neighborhoods leads to a boost in property values across the board.” 

2019 Study on Affordable Housing and Crime

Summary: 

  • Uneven Distribution of Criminal Activity. “First, and similar to other studies examining crime within a homogeneous set of facilities or land uses (e.g., Eck et al., 2007; Sherman et al., 1989 Weisburd et al., 2014), low-income housing developments in San Antonio were not uniformly criminogenic, with 5% of housing developments accounting for approximately 72% of all violent crime, 87% of all drug crime, and 72% of all property crime. As predicted, housing developments with more security and design features that control access, enforce rules, facilitate surveillance, and generally increase the risks and efforts associated with offending had lower levels of violent, drug, and property crime.”  
  • Crime and Poverty Levels. “Second, low-income housing developments located in areas with high levels of concentrated disadvantage and low levels of residential stability had higher levels of violent, drug, and property crime. Theoretically, this indicates that low-income housing developments are not isolated havens, but rather part of the larger community in which they are embedded, and thus vulnerable to deleterious neighborhood conditions.”  
  • Varying Efficacy of Security Measures and Poverty Concentration. “The relationship between security and design features and crime at the housing development varies by neighborhood concentrated disadvantage. In other words, the crime-reducing benefits of these efforts will be stronger in low-income housing developments located in more prosperous communities and weaker in developments located in more disadvantaged communities. Additional efforts may need to be made at developments located in neighborhoods suffering from high levels of concentrated disadvantage.”  
  • Recommendation for De-Concentration of Poverty. “Our findings support changes to federal policy aimed at incentivizing the development of subsidized housing in eco- nomically diverse and stable communities and moving away from previous practices of concentrating low-income housing in poor communities.”  

Consequences of Non-Compliance

If HCD determines that a Housing Element fails to substantially comply with the State’s Housing Element Law, there are potentially serious consequences. When a jurisdiction’s Housing Element is found to be out of compliance, its General Plan is at risk of being deemed inadequate, and therefore invalid. If a jurisdiction is sued over an inadequate General Plan, the court may impose requirements for land use decisions until the jurisdiction brings its General Plan into compliance. Potential consequences include:

  • More frequent updates of housing element (4-year update cycle instead of every 8 years)
  • Increased legal liability (Attorney General may bring suit to compel compliance, with fines of at least $10K to a maximum of $100K/month)
  • Loss of local control (Open to lawsuit by private parties due to GP inadequacy and the court may step in and approve housing projects, including projects in locations that may not be wanted by the local community)
  • Ineligibility for grant funds (Some state funding programs may require compliance)

Draft Land Plan that Accommodates our RHNA

Since 2018, the GPAC and public have been investigating areas where a change in land use could be possible. Originally, 13 sites were considered. Over time, some sites were deemed not to be viable and additional sites were discovered. When the RHNA was announced in late 2019, the focus became how to accommodate the large RHNA while still addressing other community desires, such as economic sustainability and community gathering places.

On April 28, 2021, at a joint meeting of the Planning Commission and City Council, a land use plan that accommodates the RHNA was selected for environmental study in the Environmental Impact Report (EIR). This plan accommodates the RHNA allocation on 11 sites (157 acres) while addressing the City’s key issues/values/vision. Click HERE for the draft plan.

A number of strategies were employed to identify suitable sites (appropriately zoned or rezoned for housing) and accommodate the RHNA:

  • Account for existing/proposed projects (e.g. Prado Family Homes)
  • Utilize appropriate vacant and underutilized land. If developed but underutilized, HCD requires evidence of likelihood to transition to housing by 2029 such as property owner interest, market evidence, and vacancy
  • Maximize the assumptions for the amount of Accessory dwelling units (ADUs) that can be counted toward the RHNA. Requires special consideration from HCD. See the Evaluation of the ADU Potential for the City of Fountain Valley Housing Element.
  • Adopt an inclusionary housing ordinance. While this is still being created, this ordinance will likely be a requirement that projects of a certain size (over 10-20 units for instance) provide at least 15% of new units as affordable for at least 30 year term
  • New General Plan land use designations:
    • Very High Density Residential. 
      • 30 to 40 du/ac without additional affordable housing (beyond potential 15% inclusionary) Proposed Land Use Plan July 2021
      • Up to 65 du/ac with 50%+ affordable housing
      • Max height: 5 stories
  • Mixed-Use:
    1. Sites smaller than 5 acres (MU-1)
      • 65 units per acre
      • 10%+ of ground floor for commercial/office
      • Max FAR: 1.9
      • Max height: 5 stories / 52 ft
    2. Sites 5 acres or larger (MU-2)
      • 40 du/ac averaged over the entire project site
      • Single family attached and multifamily products
      • 20%+ of ground floor for commercial/office. Incentive: 55 du/ac average with 30%+ commercial/office
      • Maximum FAR: 2.2
      • Max height: 6 stories / 62 ft
    3. Warner Square & Boomers sites: allow max density from 65 to 100 du/ac