City of Novato California August 23, 2023*

More housing in Marin is needed and ADUs are one solution. Response: Agree.

Many homeowners lack information and knowledge about ADU development, and Marin's jurisdictions are not always helpful to homeowners seeking information about ADU development. Response: Disagree. Homeowners have access to a wide range of resources related to ADUs and should have no reason to be unfamiliar with the basic elements of developing an ADU. Indeed, a simple Internet keyword search using "ADU California" or "Accessory Dwelling Unit California" in Google returns volumes of information and resources regarding ADUs. In the City's experience speaking with hundreds of homeowners over the past decade about development of an ADU most perform their own research, form a basic understanding of developing an ADU generally, and then contact staff with specific questions regarding local regulations and/or to discuss circumstances unique to their desired ADU or property. It is rare for a homeowner contemplating an investment of hundreds of thousands of dollars in an ADU to not be reasonably self-informed prior to contacting staff. The City recognizes the importance of developing new ADUs to provide a variety of housing choices for residents and the potential contribution of these units towards meeting the City's Regional Housing Needs Allocation (RHNA) goals. Accordingly, the City has invested significant staff and legal counsel time in drafting its ADU ordinance with a focus on distilling the convoluted and poorly organized language of State ADU law into a form that can be readily navigated by property owners and design professionals. This effort is supplemented by an experienced staff that understand State ADU law, the City's implementing ADU ordinance, and applicable provisions of the California Building Code. Staff is available by phone, email, walk-in hours, and appointment to provide general information regarding developing an ADU in Novato or to provide more specific guidance on a particular ADU proposal or question. Novato staff is always helpful to homeowners seeking information about developing an ADU.

It is often difficult, if not impossible, for a Marin homeowner to determine the planning, building, connection, capacity and impact fees associated with developing an ADU in a particular jurisdiction. Response: Disagree. City staff regularly provides guidance on fees applicable to ADUs, including producing fee estimates on request. Such assistance is necessary since development impact fees and building permit charges require calculations that are unfamiliar to the majority of property owners. While it would be challenging for a homeowner to calculate their own development impact fees, it is not impossible nor difficult for a homeowner in Novato to request and receive a fee estimate as City staff is available and capable of addressing such an inquiry. A property owner need only provide minimal information regarding the ADU they are contemplating, such as desired floor area, the floor area of the primary residence, and the estimated construction cost. With this information, staff can provide a property owner with a reasonable fee estimate. The City has gone to great lengths to integrate our permitting process with the special districts which provide services to our residents (fire, water, and sewer). However, the City does not attempt to quote fees on behalf of other public agencies, so customers need to contact those agencies separately for fee calculations. In our experience, homeowners are more than capable of accomplishing this task.

Many Bay Area cities and counties, for example Napa and Sonoma, have implemented comprehensive websites and related support to help homeowners create ADUs. Response: Agree. The City is aware that many cities and counties have websites dedicated to the development of ADUs. The City currently does not have its own website or webpage focused on ADUs. However, the City participates in ADU Marin. ADU Marin offers a variety of ADU related resources on par with many other cities and counties. The City intends to create its own ADU website pursuant to Program 1.B of Novato's Housing Element (January 2023). Program 1.B directs the expansion of efforts to encourage and streamline the construction of ADUs, including providing more expansive information and resources.

ADUs may be rented affordably and provide additional benefits for older adults and their caregivers. Response: Agree.

Most Marin jurisdictions could provide better resources offering or identifying financing incentives for ADU development. Response: Agree. Please see response to F4.

Impact, connection, and capacity fees vary considerably throughout the County and such fees can be a disincentive to homeowners considering ADU development. Partially Disagree. Response: The City agrees that fees can vary widely across the county. This is due, in large part, to the number of special districts whose sole focus is providing services to rate payers. These agencies do not have the same obligations under State law to incentivize housing development as do the towns, cities or County. The City charges development impact fees for only those ADUs exceeding 749-square feet in floor area. The development impact fee charged to an ADU exceeding this floor area is applied proportionately as a percentage of the square footage of the primary dwelling unit. This approach is compliant with State ADU law (California Government Code Section 65852.2(f)(3)(A)). The following is an example of the City's development impact fee applied to an ADU over 749 square- feet in floor area: A homeowner adds an 850 square-foot ADU to their existing 2,000 square-foot primary residence. Accordingly, the ADU represents 42.5% of the floor area of the primary residence and is therefore subject to paying 42.5% of the development impact fee otherwise applicable to a multi-family dwelling. This would equate to a fee of $8,746.49 based on a multi-family dwelling fee of $20,579.98. Novato's development impact fee for ADUs is a flat fee (regardless of ADU floor area) based on 50% of the fee amount applicable to a multi-family dwelling unit. Given this circumstance, the Community Development Department caps the impact fee for an ADU at 50% of the multi-family dwelling fee regardless of whether an ADU exceeds 50% of the floor area of a primary dwelling. The City notes the ADU fee example published in its 6th Cycle Housing Element did not fully explain how development impact fees are applied to ADUs, but rather stated the maximum possible fee amount. The City does not consider its development impact fee to be a disincentive to developing an ADU on the basis that homeowners have the option of building an ADU of 749 square-feet or less in floor area that, by State ADU law, is not subject to payment of development impact fees. This circumstance is reflective of the California Legislature's purposeful decision to incentivize the development of smaller ADUs on the basis that such units command more affordable rents compared to larger ADUs. Otherwise, State law would have flatly prohibited the application of impact fees. The City agrees with the Legislature's perspective.

Not every jurisdiction in Marin has updated its planning and building policies to conform with current California ADU laws. Response: Partially Disagree. The City has not audited the currency of ordinances of other agencies around the County. However, The City of Novato's ADU ordinance is current through State ADU laws effective in 2022. The City is currently in the process of amending its ADU ordinance to meet amended State ADU law effective 2023. Notwithstanding pending amendments, State ADU law always controls and is relied upon by the City as necessary. City staff regularly advise homeowners of newly adopted ADU law, disclose where an update(s) is necessary to the City's ordinance, and then provide guidance on the application of State law until local ordinance updates are completed. No applicant or prospective applicant for an ADU has been disadvantaged by a circumstance where the City's ordinance has not yet been updated to reflect or incorporate newly adopted law. In other words, because an agency's ADU ordinance requires an update, it does not mean the agency is violating State law. The Governor signs new legislation typically at the end of the legislative cycle in October. Most ADU related bills and other housing laws are effective January 1 of the ensuing year. At best, agencies are left with approximately 6-weeks' time, accounting for holidays, to interpret the new law, consult with legal counsel, draft revised ordinance language, conduct required noticing, and hold hearings before their planning commission and elected legislative body. In addition, ordinances require an introduction and second reading with an effective date 30-days from this reading. Accounting for all of these steps and statutory requirements, agencies do not have a reasonable amount of time to update local ordinances by the effective date of new state ADU law. Nevertheless, the City works diligently to update its ADU ordinance as soon as practically possible balancing against many other competing demands for staff time, including other housing related projects and ordinance updates.

Granting amnesty, following safety inspection, to existing non-conforming second units could help Marin meet its housing obligations. Disagree. Response: The Report does not correctly apply the term "non-conforming" within the context of discussing an amnesty program. A non-conforming ADU is an ADU that was previously permitted by an agency, but due to subsequent changes in law no longer conforms to current development or building standards. Accordingly, a non-conforming ADU does not require amnesty and is already recognized as a legal dwelling unit. The Report does not quantify or otherwise estimate the number of unpermitted ADUs that are thought to exist in Marin County. However, the Report suggests the number of unpermitted ADUs is perhaps significant based on the assertion that 40% to 70% of all construction activity in Marin --- occurs without permits. In the City's experience, unpermitted ADUs are rare based on the City's former residential resale inspection program which uncovered relatively few unpermitted dwelling units. That is not to say that unpermitted work is rare, only that unpermitted dwelling units are rare. This raises the question of whether dedicating resources to an amnesty program is a worthwhile effort when compared to other options which encourage the development of ADUs, such as devoting time to develop permit ready construction plans. It is unclear what is meant by "safety inspection." It is quite possible that unpermitted work cannot be made building code compliant without considerable re-design and reconstruction. Both of these come at considerable time and expense to homeowners. Dwelling units must be safe to occupy and a superficial inspection may not uncover potential dangers, such as electrical wiring, that are now covered-up by construction. A safety inspection does not replace a review of building plans and regular inspections which determine design, materials and methods are compliant with State law.

ADU Marin and HelloADU are a good start. However, compared to several other Bay Area cities and counties, for example Napa and Sonoma, they could be substantially enhanced and expanded. Response: Agree RESPONSE TO GRAND JURY RECOMMENDATIONS - - - - - - - - - - - - - - - - - - -