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Extracted from Consolidated Report

This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.

Nevada County Grand Jury • 2003-2004

Rebuilding the Dream: Solving California’s Affordable Housing Crisis makes this observation: “Two fundamental problems

Published: June 30, 2004 11 pages

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⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.

⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.

Findings 9 findings

Review of the prior housing element: a. Grass Valley has made progress in the last three years to accommodate its regional housing needs allotment, with the following projects: • Cedar Park Apartments (under construction), 65 low-income units, and 16 very low-income units • Glenbrook Apartments (approved), 41 low-income units, 11 very low-income units b. From January 2000 to January 2003, Grass Valley built about 38% of their regional housing allotment. However, no housing units were built for households of moderate-income levels and about 10% of housing units allocated to very low- income households were built. Housing units constructed/under construction/approved are shown in the table below. Progress in Meeting Housing Allocation (Units Constructed/Under Construction/Approved January 2000 - January 2003) Income Level Housing Units Remaining Allocation Allocation Very low 274 27 241 Low 261 106 145 Moderate 333 0 333 Above 580 417 163 Moderate Total 1,448 550 898 Source: City of Grass Valley (definition of income levels not provided in Housing Element)

Housing needs assessment: According to the Sierra Planning Organization (SPO), Grass Valley is responsible for accommodating 1,448 additional housing units between 2001 and 2009, of which 535 units should be affordable to very low, and low-income households. This represents approximately 37% of Grass Valley’s total share of regional housing needs. The table below shows the number and percentage of housing units allocated for the planning period 2001 through 2009 by income category. Regional Housing Needs Allocation. Number of Income Category Units Percentage Very Low (below $29,500) 274 19% Low ($29,500 to $47,200) 261 18% Moderate ($47,200 to $70,800) 333 23% Above Moderate (above $70,800) 580 40% Totals 1,448 100% Source: SPO and California Department of Housing and Community Development

Constraints on housing: a. According to the Housing Element, governmental regulations, local policies and regulations are putting constraints on affordable housing that impact price and availability. However it also states, “Perhaps one of the greatest constraints to the production of housing affordable to lower-income households is the chronic shortage of state and federal financial assistance for such housing.” b. Permit and mitigation fees affect housing costs. The fee structure for Grass Valley is shown in the table below. Government Fees Single Family Home 1200 sq. ft. Building Permit $1,200 City AB 1600 Fees (Fire, Police, Parks & Recreation, 2,150 etc.) Regional Traffic 630 School Mitigation 2,572 Sewer Connection 7,860 Water Connection 3,300 Total $17,712 Source: City of Grass Valley - December 2003

General topics: “Many unique circumstances face our community and the provision of adequate housing for all residents is dependent upon creating a program that adequately addresses these issues. Grass Valley has experienced a substantial rise in housing costs since the late 1990’s; however, median household income in the City continues to fall well short of that in the rest of the County, including Nevada City and Truckee. The community also has a much higher percentage of rental housing than the County, and must ensure that new programs meet the needs of both future homeowners and renters alike.” Income statistics are shown in the table below. Jurisdiction Median Household Income Nevada County $45,864 Grass Valley $28,182 Nevada City $36,667 Truckee $58,848 Source: Census 1990, 2000

Local housing program goals: Housing goals and policies are established to guide the development, rehabilitation and preservation of housing to meet the needs of the city. Grass Valley has proposed 28 housing programs to help increase the affordable housing stock within the city. Seven programs depend on general fund monies, nine programs are funded from state and federal grants, six programs are funded from fees, five programs are funded from a combination of grants and fees, and one program is funded from Tax Exempt Bonds. As an example, Program 13 (The Density Bonus) is to be revised by December 31, 2005 to offer a 25% increase in density and at least one other financial or regulatory incentive whenever a developer proposes a residential project that meets the program requirements. CONCLUSIONS

Implementation of the housing policies proposed by Grass Valley would requires funding from a broad base of funding sources that include the city’s general fund (25%), state and federal grants (28%), application fees (21%) and a combination of grants and fees (18%). This “even” spread of funding sources could help to ensure the production of affordable housing units.

The Grass Valley permit and mitigation fee structure adds an additional $17,712 to the cost of a 1200 sq. ft. housing unit. These fees provide benefits to the City as a whole, but they also work to raise the bar of affordability for low and moderate-income households.

The proposed housing density bonus could serve to encourage the construction of affordable housing. However, the mood of the community, as expressed at three recent public hearings, favors a reduction in housing density for any given housing project.

Secondary Units are the only category where there appears to be any possibility of implementation, and these must be rentals.

Recommendations 10

R1

The Grass Valley City Council should direct the Department of Community Development to follow their Workforce Housing Study (Program 12), and apply the results of that study to address the problem of housing for low and moderate-income families.
R2

The Grass Valley City Council should direct the Department of Community Development to look beyond the planning stage of affordable housing, and focus on the actual building of affordable housing.
R3

The Grass Valley City Council should direct the Department of Community Development to pursue additional state and federal grants that would increase the affordable housing stock in the city.
R4

The Grass Valley City Council should adopt a Below Market Rate (BMR) Ordinance and/or revise the present density bonus to require a fixed percentage of affordable housing units in all new single-family housing developments.
R5

The Grass Valley City Council should direct the Department of Community Development to consider a waiver or reduction of permit and/or mitigation fees to encourage the development of affordable housing. RESPONSES Grass Valley City Council
R6

The Nevada City Council should adopt a Below Market Rate (BMR) Ordinance to require a fixed percentage of affordable housing units in all new single-family housing developments. The Nevada City Council should direct the Planning Commission to examine other housing programs such as the Grass Valley Workforce Housing Project and apply the best features of these programs to Nevada City's housing needs.
R7

The Truckee Town Council should direct the Department of Community Development to continue the policy of waiving permit and mitigation fees for housing projects that qualify for the Town's incentive programs. RESPONSES Town of Truckee Town Council by October 4, 2004 \gamma_{i_1} = Y . 1
R8

The Nevada City Council should direct the Planning Commission to waive and/or reduce permit and/or mitigation fees to encourage the development of affordable housing. RESPONSES Nevada City, City Council by October 2, 2004 . 4 - 22 Town of Truckee Affordable Housing 1 * (4) ٠ ŉ X . ı ķ )) × ĺ è 1 5 8 1 - 92
R22-32

150 150 120 Secondary Units Source: Housing Element 5. Constraints on housing: a. "Historically, small second units in single-family homes were interspersed in the City's neighborhoods. These second units blended in well with the diversity of housing types typically found in each neighborhood. In 1978, a City survey was taken in order to install water metering throughout the town. At that time, 61 second units were identified. Over the years, several of those units were lost, usually because new owners chose not to continue them. In 2003, the City bills for water and/or sewer 41 homes with seconds units and five homes with two second units each (sic)." b. Secondary units have a maximum range of 300 to 640 square feet, must have one parking space, and when the unit is sold or no longer rented to moderate/low income residents, the owner will be required to pay all the deferred fees, in some cases with interest. c. Permit and mitigation fees affect housing costs. The fee structure for Nevada City is shown in the following table. * * 1 12
R33-37

11-13 11 - 12 11 - 12 Multi Family Units 101-110

Conclusions 8

CL1 Page 5

The City of Grass Valley can address the affordable housing issue in three ways: • Locate available land, create zoning and develop policies and procedures to encourage the construction of affordable housing. Free-market forces will then dictate the type of housing that actually is built. • Develop financial incentives and the political will to encourage the construction of affordable housing. These actions will work to increase the affordable housing stock. • Develop financial assistance programs to help residents purchase affordable housing. These actions will help residents get a “jump-start” into the housing market.
CL2 Page 6

Free-market forces appear to be a major deterrent to the production of housing affordable to people in very low, low, and moderate-income levels. For these households, single- family home ownership will remain an unfulfilled dream unless Grass Valley becomes an advocate for the production of affordable housing.
CL3 Page 6

Without state, federal, and local financial subsidies, few housing units affordable for the very low, low, and moderate-income families will be built. Consequently, cities are concentrating on meeting the needs of their local workforce population with housing to accommodate the above moderate-income level households.
CL4 Page 6

The median income of Grass Valley residents for 2000 was $28,182, which was $17,500 less than the median income of Nevada County. This statistic means Grass Valley residents will be at a disadvantage when competing in the local housing market.
CL5 Page 6

Implementation of the housing policies proposed by Grass Valley would requires funding from a broad base of funding sources that include the city’s general fund (25%), state and federal grants (28%), application fees (21%) and a combination of grants and fees (18%). This “even” spread of funding sources could help to ensure the production of affordable housing units.
CL6 Page 6

The Grass Valley permit and mitigation fee structure adds an additional $17,712 to the cost of a 1200 sq. ft. housing unit. These fees provide benefits to the City as a whole, but they also work to raise the bar of affordability for low and moderate-income households.
CL7 Page 6

The proposed housing density bonus could serve to encourage the construction of affordable housing. However, the mood of the community, as expressed at three recent public hearings, favors a reduction in housing density for any given housing project.
CL8 Page 5

The Grass Valley Housing Element addresses the issue of affordable housing from the perspectives of geography, population demographics, workforce mix, free-market forces, employment growth, community values, and the availability of vacant land. These perspectives tend to dictate the local solutions to addressing the issue of affordable housing.

No Responses Found 1

Government entities assigned to respond to this report. No response documents have been linked in our database.

Grass Valley City