For the past six months the Economic Vitality Corporation, the Home Builders Association of the Central Coast and the San Luis Obispo Chamber of Commerce have worked together to study, research and devise strategies that would create more housing options for the SLO County workforce.

The collaborative effort was in response to a unanimous vote cast by the SLO County Board of Supervisors in November of 2015 directing staff to research potential solutions to the housing affordability crisis on the Central Coast.

To identify and prioritize policy solutions the three organizations held numerous meetings with County officials, as well as working sessions with stakeholders who have expertise in land-use planning, housing development and affordable design. Additional information was made available through an affordable housing survey conducted by the County’s Planning and Building Department.

The resulting 30-page “Housing Policy Solutions” report was shared with County administrators and has been included in the “Affordable Housing – Policies and Programs” staff report that was presented to the Board of Supervisors to be considered for policy and program amendments on October 4.

The report created by the EVC, HBA and Chamber recognizes the many housing challenges facing the community, and proposes solutions that would open the door to new housing options in SLO County. These solutions are summarized below and you can see the entire report here.

Zoning: Zone for Large Scale Projects

Over the past 20 years San Luis Obispo County, and the cities therein, have produced housing at a rate below what is suggested by the County Regional Housing Needs Allocation, with most new housing projects focused on small infill sites rather than large-scale project sites.

The report proposes zoning for larger scale housing projects as well as potential sphere of influence expansion to accommodate more residential units.

Zoning for larger projects would allow developers to create more housing stock per project and therefore would allow them the opportunity to be more cost efficient, resulting in lower housing costs.

The plan also calls for a planned development process. This would encourage creative new community planning and provide a process for developers to submit plans for County consideration that, if supported, would allow for specific plans, detailed studies and long-term land-use and economic development plans.

With the larger parcel projects comes the discussion on whether the cities should expand their sphere of influence.

Working with the San Luis Obispo Local Agency Formation Commission (LAFCO), the County can lead the identification of areas where expanding a city’s sphere of influence is consistent with their policies. Identifying potential expansion areas would create opportunities and spur larger development opportunities.

Process Time: Streamline Process Calendar

Another contributor to high housing costs is the time that it takes to get a new project approved. The study found that it is not unusual for a project to take 10-15 years from inception to actual housing development. These delays create added expenses to the developer resulting in higher housing costs.

The proposed solution is to create a process that holds both the developers and the staff accountable with established project milestones, an approval process at the senior staff level and staffing plan agreements.

Process Time: Establish Floor on Housing Growth

The County does not currently have a growth floor to ensure that housing development keeps pace with population growth in the County.

The County needs to create an objective, quantitative floor that includes minimum annual numbers for housing that are anticipated to be built within a specific timeframe. This will commit the County to a plan and process that will match its stated goals in job growth.

Fees: Scale Fees to Unit Size

Many fees that the developer pays are based on the number of units as opposed to the size of the units. Therefore, when building smaller, more affordable units the fees become a higher percentage of the cost per unit, and as a result the developer is incentivized to build larger, less affordable, units.

The County should assess the fee based upon the square footage of each unit instead of a flat fee per unit.

Fees: Revise Timing of Payment within Fee Schedule

Currently, fees are required to be paid during the beginning stages of a project, this creates a higher financial risk for developers and prevents some residential projects from going forward.

Nearly 50 local jurisdictions in California have adopted fee deferrals, delaying fee collection until a final inspection is completed. By joining these other jurisdictions, the County would eliminate the cost of financing the impact fees for the developer, and therefore reducing their carrying costs and dropping the cost of building each unit.

Infrastructure: Regional Approach to Funding and Spending

Developers are often tasked with updating or building the infrastructure needed for the project they are planning. Often this makes sense, as when the only people benefiting from the infrastructure are those buying the houses. More often however, this gets complicated, as when the infrastructure will benefit more than just the homeowners, or when it crosses city lines falling into multiple jurisdictions.

The report recommends using the San Luis Obispo Council of Government’s model which includes representation to ensure collaboration with all jurisdictions in the county. This approach lends itself to exploring all funding opportunities including state programs, grants and discretionary funding to name a few.

CEQA: Administrative Draft Review of EIR

The County does consult the applicant during the preparation of the Administrative Draft Environmental Impact Report, however it does not allow for applicant review of the document before the Public Review Draft EIR is prepared. This can result in significant errors and omissions resulting in the recirculation of the EIR.

The applicant should be allowed to communicate with staff during the EIR process, to minimize any significant errors in advance of the final published EIR.