HomeMy WebLinkAbout2020-03-24; City Council; ; 2019 Housing Element Annual Progress Report.~ CITY COUNCIL
~ Staff Report
Meeting Date:
To:
From:
Staff Contact:
Subject:
March 24, 2020
Mayor and City Council
Scott Chadwick, City Manager
Corey Funk, Associate Planner
corey.funk@carlsbadca.gov or 760-434-4645
2019 Housing Element Annual Progress Report.
Recommended Action
CA Review ~ /J.___
Adopt a resolution accepting the 2019 Housing Element Annual Progress Report.
Executive Summary
The Housing Element Annual Progress Report is an information report prepared annually that
details the status of the city's progress meeting its share of regional housing production goals
and implementing the programs of its Housing Element. California Government Code Section
65400(a)(2) requires the City Council to consider this report at a public meeting.
Discussion
The attached 2019 Housing Element Annual Progress Report (Attachment A to Exhibit 1) has
been prepared to fulfill the reporting requirements of the state (Government Code Section
65400(a)(2)) and the city's Housing Element Program 3.18. In addition, preparing and
submitting the reports enables the city to apply for certain grants administered by the
-California Department of Housing and Community Development (HCD) and San Diego
Association of Governments (SAN DAG), including:
• SANDAG -Smart Growth Incentive Program
• SANDAG -Active Transportation Grant Program
• HCD -Infill Infrastructure Grant Program
• HCD -Housing-Related Parks Program
• HCD --SB2 Planning Grant
The 2019 Housing Element Annual Progress Report (Attachment A to Exhibit 1) includes:
• A list of housing development applications deemed complete in the reporting year,
along with the number of units included, approved, and disapproved in each application
(Table A of the report).
March 24, 2020 Item #2 Page 1 of 33
• A list of housing projects, and their respective number of units, that were issued a
completed entitlement, a building permit, and/or an approved final inspection, in the
reporting year (Table A2 of the report)
• The income category that each new housing unit satisfies in Tables A and A2 of the
report, as defined by the federal Department of Housing and Urban Development and
the state Department of Housing and Community Development (i.e., very low, low,
moderate, and above-moderate income categories);
• Housing Production Status (Table B of the report) -Provides the status of housing
production in the city and. the city's progress in meeting its share of regional housing
needs during Calendar Year (CY) 2019.
• Program Implementation Status (Table D of the report) -Provides the status of and the
city's progress toward implementing the City of Carlsbad 2013-2021 Housing Element
programs during CY 2019.
• Requirements that did not apply to Carlsbad and were left unreported (Tables C, E, F
and G of the report)
Also included with this staff report is Exhibit 2-Description of Terms and Methods, which
provides additional information about the Regional Housing Needs Assessment and the housing
income levels.
Fiscal Analysis
Accepting this informational report has no fiscal impact.
Next Steps
Staff will provide this report to the California Office of Planning and Research, HCD, SAN DAG
and the City of Carlsbad Planning Commission.
Environmental Evaluation (CEQA}
This report is categorically exempt from environmental review as per CEQA Guidelines Section
15306, which states that information collection activities are exempt from the provisions of
CEQA.
Public Notification and Outreach
This item was noticed in accordance with the Ralph M. Brown Act and was available for public
viewing and review at least 72 hours prior to scheduled meeting date.
Exhibits
1. City Council resolution
2. Description of Terms and Methods
March 24, 2020 Item #2 Page 2 of 33
RESOLUTION NO. 2020-050
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD,
CALIFORNIA, ACCEPTING THE 2019 HOUSING ELEMENT ANNUAL PROGRESS
REPORT
EXHIBIT 1
WHEREAS, the Annual Housing Element Progress Report has been prepared to comply with
Government Code Section 65400(a)(2), meet the grant funding requirements of certain San Diego
Association of Governments, and California Department of Housing and Community Development
programs, and implement Housing Element Program 3.18. The purpose of the report is to provide
information to the City Council, the State Office of Planning and Research, the State Department of
Housing and Community Development, San Diego Association of Governments and the public as to the
status of the Housing Element programs, as well as mark the City's progress in meeting its share of the
region's housing needs.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad, California, as
follows:
1. That the above recitations are true and correct.
2. That the report (Attachment A) is accepted, and the City Planner is directed to submit
the report to the California Office of Planning and Research, the California Department
of Housing and Community Development, and the San Diego Association of
Governments.
PASSED, APPROVED AND ADOPTED at a Regular Meeting of the City Council of the City of
Carlsbad on the 241h day of March 2020, by the following vote, to wit:
AYES:
NAYS:
ABSENT:
Hall, Blackburn, Bhat-Patel, Schumacher
None
None
:.,
BARBARA ENGLESON, City Clerk
(SEAL)
March 24, 2020 Item #2 Page 3 of 33
Jurisdiction Carlsbad
Reporting Year 2019 (Jan. 1 -Dec. 31)
Project Identifier
1
Prior AP!< CurrentAPN Street Address Project Name•
Summarv Row: Start Data Entrv Below
2072304600 4816 Kelly Dr HOOVER LEE
2061601300 4269 Hillside Dr MURRAY RESIDENCES
2155022000 1730 Cereus Ct LEWISTON ADU
2042320400 3677 Garfield ST HERNANDEZ
RESIDENCE
2041502600 34 72 Garfield St GARFIELD STREET
ADU
2061400800 1145 Harborview Ln HALLBERG ADU
2033020400 786 Grand Ave GRAND JEFFERSON
155221 1200 570 Laguna Dr LAGUNA DRIVE
SUBDIVISION
2120405600 1205 Aviara PkWY AVIARA APARTMENTS
2042100300 3535 Harding St HARDING & PALM
TOWNHOUSE
2040310100 Madison St MADISON FIVE
2153702800 El Fuerte St EL FUERTE VIEW
2033031600 2975 JEFFERSON 2975 JEFFERSON
ST STREET
2040911300 540 Chestnut 540 CHESTNUT SFR +
ADU
2161701400 Viejo Castilla Wy RESORT VIEW
APARTMENTS
1560511200 2297 HIGHLAND
DR
2154202200 2719 OBELISCO
CT
2073503300 4810 REFUGIO
AVE 100
1671220600 3510 CHARTER
OAK DR
2051203600 1389 BASSWOOD
AVE
1675632400 4373 TUOLUMNE
PL
1562313600 1330 KNOWLES FERRI RESIDENCE
AVE
1672803400 3744 LONGVIEW
DR 150
2231405100 3213 LA COSTA
AVE
2061924900 4575 PARK DR
2052204100 3516 HIGHLAND
DR
2042702800 333 REDWOOD
AVE
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 §6202)
Table A
Note: "+" indicates an optional field
Cells in grey contain auto-calculation formulas
Housing Development Applications Submitted
Date
Unit Types Application Proposed Units -Affordability by Household Incomes
Submitted
2 3 4 5
Tenure Date Very Low-Very Low-Low-Income Low-Income Moderate-Moderate-Above Local Jurisdiction Unit Category Income Non Income Non (SFA,SFD,2 to Application Income Deed Deed Non Deed Income Deed Moderate-Tracking 10• R=Renter Deed Deed 4,5+,ADU,MH) O=Owner Submitted Restricted Restricted Restricted Restricted Restricted Restricted Income
0 0 86 1 0 31 318
ADU Renter 1 CDP 2019-0014 6/3/2019
CDP 2019-0028 SFD Owner 12/18/2019 3
ADU Renter 10/30/2019 1 CDP 2019-0026
CDP 2019-0023 SFD Owner 12/18/2019 1
CDP 2019-0022 ADU Renter 1
8/28/2019
CDP 2019-0031 ADU Renter 11/20/2019 1
CT 2018-0008 5+ Owner 6
7/3/2019
CT 2018-0006 SFD Owner 1/7/2019 13
EIR 2018-0001 5+ Renter 9/30/2019 82 247
CT 2017-0008 SFA Owner 1/11/2019 6
CT 2019-0002 5+ Owner 5/10/2019 5
MS 2018-0010 SFD Owner 11/4/2019 4
RP 2018-0009 2/4/2020 Renter 2/14/2019 1
V 2018-0010 SFD Owner 11/7/2019 1 1
SOP 2018-0022 5+ Renter 11/21 /2019 4 22
CBR2019-0898 ADU Renter 4/17/2019 1
CBR2019-1032 ADU Renter 4/30/2019 1
CBR2019-0633 ADU Renter 3/20/2019 1
CBR2019-0016 ADU Renter 1/4/2019 1
CBR2019-0046 ADU Renter 1/8/2019 1
CBR2019-2191 ADU Renter 8/15/2019 1
CBR2019-0409 SFD Owner 2/21/201 9 1
CBR201 9-2407 ADU Renter 9/3/2019 1
CBR2019-0499 ADU Renter 3/5/2019 1
CBR2019-1257 SFD Owner 5/20/2019 1
CBR201 9-2740 ADU Renter 10/1/2019 1
CBR2019-2950 ADU Renter 10/18/2019 1
Attachment A
Total Total
Approved Disapproved
Units by Units by Streamlining Notes
Project Project
6 7 8 9 10
Total Was APPLICATION
Total Ql§AfPRQVEO SUBMITTED
Total PRQPOSED UnitS by Project Pursuant to GC APPRQVED Notes• Units by Project (Auto-calculated 65913.4(b)? Units by project Can Be (S835
Overwritten) Streamlining)
436 30 0 0
1 1 0 No
3 0 No
Under review
1 1 0 No
1 0 No
Under review
1 1 0 No
1 0 No
Under review
6 0 No
Under review
13 0 No
Under review
329 0 No
Under review
6 6 0 No
5 5 0 No
4 0 No
Under review
1 1 0 No
2 2 0 No
26 0 No
Under review
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
1 1 0 No
March 24, 2020 Item #2 Page 4 of 33
Total was ADDI 1r.1.noN
Unit Category Tenure Date Very Low-Very Low-Low-Income Low-Income Moderate-Moderate-Above Total Dlii!APPROV§Q !21.!iMII!l;D Local Jurisdiction Income Non Income Non Total PRQ~§D Units by Project Pursuant to GC PrlorAPN• CurrentAPN Street Address Project Name• Tracking 10• (SFA,SFD,2 to R=Renter Application Income Deed Deed Deed Non Deed Income Deed Deed Moderate-Units by Project APPROVED (Auto-calculated 65913.4(b)? Notes•
4,5+,ADU,MH) O=Owner Submitted Restricted Restricted Restricted Restricted Restricted Restricted Income Units by project Can Be (S836
Overwritten) Streamlinlng)
2162403300 2405 TORREJON CBR2019-3028 ADU Renter 10/25/2019 1 1 1 0 No
PL
2232500100 7553 ESFERA ST CBR2019-1049 ADU Renter 5/1/2019 1 1 0 No
Under review
2081603200 5067 ASHBERRY CBR2019-2622 ADU Renter 9/19/2019 1 1 0 No
RD Under review
2071202600 3872 VALLEY ST CBRA2019-0038 ADU Renter 1/30/2019 1 1 0 No
Under review
2156102900 7129 AVIARA DR SEHGAL RESIDENCE CBR2019-0014 SFD Owner 1/3/2019 1 1 0 No
Under review
2054303200 3832 MARGARET CBR2019-3427 ADU Renter 12/4/2019 1 1 0 No
WAY Under review
2644812100 3561 CORTE CBR2019-1352 ADU Renter 5/30/2019 1 1 0 No
ESPERANZA Under review
2154600500 2700 ARGONAUTA 2700 ARGONAUTA CBR2019-0988 SFD Owner 4/25/2019 1 1 0 No
ST RESIDENCE Under review
2050201800 1389 OAK AVE OAK AVENUE PARCEL CBR2019-2901 SFD Owner 10/15/2019 1 1 0 No
MAP Under review
1562317400 1463 BUENA CBRA2019-0332 SFD Owner 11/15/2019 1 1 0 No
VISTA WAY Under review
2050511100 3293 HIGHLAND CBRA2019-0275 ADU Renter 9/18/2019 1 1 0 No
DR Under review
2050809700 3217 MAEZEL LN CBR2019-3686 ADU Renter 12/30/2019 1 1 0 No
Under review
2225923900 2813 VIA CBR2019-2012 ADU Renter 7/31/2019 1 1 0 No
CONQUISTADOR Under review
2053303500 2073 LEE CT CBR2019-1436 ADU Renter 6/6/2019 1 1 0 No
Under review
2050805400 1892 BASSWOOD CBRA2019-0343 ADU Renter 12/2/2019 1 1 0 No
AVE Under review
1562317400 1465 BUENA CBRA2019-0333 ADU Renter 11/15/2019 1 1 0 No
VISTA WAY Under review
2050522500 1310 BASSWOOD CBR2019-2961 ADU Renter 10/21/2019 1 1 0 No
AVE Under review
2156901500 1305 CASSINS ST CBR2019-0577 ADU Renter 3/14/2019 1 1 0 No
Under review
2050205700 1286PINEAVE 1284 PINE AV LOT CBRA2019-0141 ADU Renter 517/2019 1 1 0 No
SPLIT Under review
2152311200 7287 ALMADEN LN CBR2019-3120 SFD Owner 11/4/2019 1 1 0 No
Under review
2154600600 2670 ARGONAUTA ABEDI MOGHADDAM CBR2019-1401 SFD Owner 6/4/2019 1 1 0 No
ST FAMILY RESIDENCE Under review
1551603700 1112 BUENA CB R2019-3369 ADU Renter 11/26/2019 1 1 0 No
VISTA WAY Under review
2050205700 1284 PINE AVE 1284 PINE AV LOT CBRA2019-0140 SFD Owner 5/7/2019 1 1 0 No
SPLIT Under review
2051900900 1082 PALM AVE THIRKELL ADU CBR2019-1940 ADU Renter 7/23/2019 1 1 0 No
Under review
March 24, 2020 Item #2 Page 5 of 33
Jurisdiction Carlsbad
Reporting Year 2019 (Jan. 1 -Dec. 31)
Project Identifier
1
Local
PriorAPN• CurrentAPN Street Address Project Name• Jurisdiction
Tracking ID+
Summary Row: Start Data Entry Below
2033031600 2975 2975 RP2018-0009 JEFFERSON ST JEFFERSON ST
2033510300 3050 MADISON 4 PLUS 1 RP150016 ST LUXURY LIVING
2040911300 540 CHESTNUT 540 CHESTNUT V2018-0010 SFR+ADU
2041502600 3472 GARFIELD GARFIELD ST CDP2019-0022 ST ADU
HARDING AND
2042100300 3535 HARDING PALM CT2017-0008 ST TOWNHOUSE
PROJECT
2070221100 4246 HILLSIDE HILLSIDE DRIVE CDP2019-0002 DR RESIDENTIAL
2155022000 1730 CEREUS LEWISTON ADU COP2D19-0026 CT
2040310100 MADISON ST MADISON FIVE CT2019-0002
2052102200 1196 NAYLOR MS150001 MAGNOLIA AV JORDANTPM
2050201800 1391 OAK AVE OAK AVENUE MS201S-0002 PARCEL MAP
2122720100 Twain Ave. OCEAN VIEW GPA15002 POINT
2031013500 2569 ROOSEVELT CT2017-0006 ROOSEVELT ST TOWNHOMES
2070640200 3960 SLOWIK ADU CDP2017-0064 SUNNYHILL DR
2031012000 2646 ST ATE ST THE SEAGLASS CT2018-0004
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 ~6202)
TableA2
Annual Building Activitv Report Summarv -New Construction, Entitled, Permits and Comoleted Units
Unit Types Affordability by Household Incomes -Completed Entitlement
2 3 4
Tenure Unft Category Very Low-Very Low-Low-Income Moderate-Moderate-Low-Income (SFA,SF0,2 to R=Renter Income Deed Income Non Deed Restricted Non Deed Income Deed Income Non
4,5+,AOU,MH) Restricted Deed Restricted Restricted Restricted Deed Restricted O=Owner
0 0 0 0 0 5
2/4/2020 Renter
2/4/2020 Renter
SFD Owner 1
ADU Renter 1
SFA Owner
SFD Owner 1
AD~ Renter 1
5+ Owner
SFD Owner
SFD Owner
SFD Owner
SFA Owner
ADU Renter 1
SFA Owner
Note: "+" indicates an optional field
Cells in grey contain auto-calculation formulas
Housing with Financial Housing without Term of
Streamlining Infill Assistance and/or Deed Financial Assistance Affordability or Demolished/Destroyed Units Notes Deed Restrictions or Deed Restrictions Restriction
5 6 13 14 15 16 17 18 19 20 21
Was Project For units affordable
without financial Term of
How many of the ~ Assistance assistance or deed Affordability or Above Entitlement using GC Programs for Deed Resbiction Number of DemolishedtDest # of Units issued units were Infill Units? restrictions, explain how Deed Restriction OemoJiahed or Moderate-Date Aeeroved Extremely Low 65913.4(b)? YIN• Each Type tho locality determined tho (years) [If affordable Demolf1hed1Dest Destroyed Units+ royedUnils Notes•
Income Entitlements (S835 Development (see instructions) rayed Untts• Owner or Rentet Income?• units were affordable In peq,etulty enter streamlining) (HO Instructions) (see instructions) 1000)' YIN
41 46 0 0 5 0 0
1 4/5/2019 N
1
2 1/10/2019 2 N 2 Demolished
1 12/23/2019 2 N Developer survey
9/12/2019 1 N Developer sU1vey
5 9/4/2019 N 1 Demolished
5
1 12/23/2019 N Developer survey
2
11/13/2019 1 N Developer survey
5 7/18/2019 5 N
1 7/25/2019 1 N
1 8/5/2019 1 N
13 8/20/2019 13 N
4 4/3/2019 N 1 Demolished
4
2/6/2019 1 N Developer survey
7 4/17/2019 7 N 1 Demolished
March 24, 2020 Item #2 Page 6 of 33
--- --...Ill ~ Ill - -
....-Yl7lll"JIJV"1Ul"71~
WasPro)eol A1'si&tllnCII without financial Term of ,.._ Very Low-Moderate-HO}Ymanyol ~ Pn>gr-fOr Dead asslmnoe or dee!I Afforrlab!Uty or Number of l)emOllsl,etl/0 l.!>l>al u111u;a11190,y Very Low-Income Non Low-Income Low-Income Moderate-Income Non Above Building # of Units the units we"' using GC 1111111 Units? Each Rnlriotioll n1111riclll>ns, e,cplaln Deed Restriclion Qamollslle<II Dalll~ e&tropad PtlorAPN• CUn'entAPN Strut Address ProjecJ Nllnie• .lur"ISdlctien (8FA.Sl'D~ lo ~ Income Deed Deed Deed Non Deed Income Deed Deed Moderate-Permits Date Issued Building EKtremely Low 65913.4(1>!? YIN' Dewlopment fype howthdo!llllit,v (rears) (If Oestroyecl or Dai>tfo,-.1 1.11111s Owner NDm•
TrllGkiJll'tD' 4.5~,IIDU,MH) Restricted Restricted Restricted Restricted Income Issued Permits (BB3J (See decermlneJI the unilll affordable in uni.• O,,Own11r Restricted Restricted tnceme?' swamllnlngj {see IIISWUDtlonsj wet<>affGAl!lble f"'rpelUrtyel)ler Units' Gtftelllar'
YIN inSb'uctionsj (see lpstructions) 1000,•
SHERIDAN PLACE CBRA2017-2060424700 3913 SHERIDAN PL SINGLE FAMILY SFD Owner 1 3/2212019 1 N
RESIDENCE 0152
2042804505 430 TAMARACK AVE TAMARACK BEACH CBRA2018-SFD HOMES 0244 Owner 3 4/15/2019 3 N 2 Demolished
2070731000 4054 SKYLINE RD THOMPSON CBR2018-3474 ADU Renter 1 8/28/2019 1 N Developer survey GEESBREGHT ADU
2040701100 3355 TYLER ST TYLER STREET CBRA2019-SFA RESIDENCES 0053 Owner 6 9/12/2019 6 N 2 Demolished
2132621858 6066 COLT PL 105 UPTOWN BRESSI CBRA2019-SFA Owner 17 62 4/23/2019 79 N INC RANCH 0120
2041321709 350 WALNUT AVE WALNUT BEACH CBRA2018-SFA HOMES 0220 Owner 8 9/18/2019 8 N 2 Demolished
1562205900 1760 YADA PL YADA FARM CBRA2018-SFD Owner 11 6/27/2019 11 N 0055
1562200100 1732 YADA PL YADAFARM CBRA2018-ADU 0077 Renter 2 4/17/2019 2 N INC
March 24, 2020 Item #2 Page 8 of 33
Jurisdiction
epo mg
Year
PriorAPN'
Carlsbad
2019
CurrentAPN
Summarv Row: Start Data En
1562310100
1561522900
1561522900
2050804700
2146312500
2042703200
2231700700
1670531600
1562314500
1673920300
2052209700
2073503300
2152205600
2232840500
1560511200
1560320800
2054401900
1671220600
2070532400
2152205900
2041111100
1670406134
2042310600
1675314500
1675315200
1670404524
1670406221
1670404600
2033032101
2042341500
1561426000
2061804100
2071206600
2232500700
2060423500
2231305000
2042804401
1563512500
1563512500
2070640300
2052208600
2030230400
2030230400
2081951100
2081951000
2150431600
(Jan. 1 -Dec. 31)
Project Identifier
1
Street Address Project Name+
rv Below
1289 BUENA VISTA
WAY
2605 CREST DR
2607 CREST DR
3237 MAEZEL LN
6760 STRAWBERRY
PL
392 TAMARACK AVE
7722 F AROL PL 102
3357 RIDGECREST
DR
2552 GREGORY DR
2726 NAPLES CT 102
3687 VALLEY ST
4810 REFUGIO AVE
100
2155ALGARD
7437 TRIGO LN
2297 HIGHLAND DR
2362 CIPRIANO LN
1642 BRADY CIR
3510 CHARTER OAK
DR
3910 MONROE ST
2139ALGA RD 2139 ALGA ROAD
906 PINE AVE 906 PINE AVENUE
3125 SALINA RD ACACIA AT THE
PRESERVES
163 ACACIA AV ACACIA ESTATES
3108AFTON WAY AFTON WAY
3110AFTONWAY AFTON WAY
3394 CAMPO AZUL AGAVE AT THE
CT PRESERVE
3281 VESTRA WAY BLUE SAGE CONDOS
3066 VILLETAAVE CYPRESS AT THE
PRESERVE
741 GRAND AVE GRAND MADISON THE
157 CHESTNUT AVE KIM RESIDENCE
REMODEL
1610 BUENA VISTA KING PROPERTY WAY
4422 ADAMS ST KLOVANISH
RESIDENCE
3987 PARK KOBAYASHI SOU
3325 VENADO ST LO RESIDENCE
LONG PLACE
3998 LONG PL ACCESSORY
DWELLING UNIT
3111 CADENCIA ST LOT 213 LA COSTA AVE
707 MAGNOLIA AVE MAGNOLIA
TOWNHOMES
1228 LANAI CT MILES PACIFIC
SUBDIVISION
1230 LANAI CT MILES PACIFIC
SUBDIVISION
4012 SUNNYHILL DR NAUGLER ADU
1655 CHESTNUT AVE OZAKI PARCEL 2
250 NORMANDY LN RANCHO PARADISO
252 NORMANDY LN RANCHO PARADISO
2600 GAGE DR ROBERTSON RANCH
WEST VILLAGE
2514 WEST RANCH ROBERTSON RANCH
ST WEST VILLAGE
6659 PEREGRINE PL SEASCAPE
Local
Jurisdiction
Traclclng w•
CBR2017-1350
CBRA2017-
0123
CBRA2017-
0124
CBR2018-2110
CB163973
CBR2018-2113
CBR2018-0407
CBRA2018-
0145
CBR2018-0526
CBR2018-0785
CBRA2018-
0023
CBR2019-0633
CBR2018-3106
CBRA2018-
0209
CBR2019-0898
CBR2018-2692
CBR2018-2044
CBR2019-0016
CBR2018-1656
CBR2017-1415
CBR2016-0348
CBRA2017-
0337
CB161771
CBRA2017-
0070
CBRA2017-
0249
CBRA2017-
0231
CBRA2017-
0343
CBRA2017-
0139
CBRA2017-
0322
CBRA2018-
0042
CBR2017-2481
CBR2017-1231
CBR2017-0589
CB161829
CBR2018-1561
CBR2018-0464
CB162031
CB152653
CB160932
CBR2018-1869
CB163118
CBRA2017-
0018
CBRA2017-
0016
CB153566
CB160131
CB160500
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
/CCR Title 25 &62021
Table A2
Annual Building Activity Report Summary -New Construction, Entitled, Permits and Completed Units
Unit Types Affordability by Household Incomes -Certificates of Occupancy
2 3 10
Tenure Very Low-Moderate-Urlll category Very Low-Low-Income Low-Income Moderate-Above Income Non Income Non (SFA,SFD,2 to R=Renter Income Deed Deed Deed Non Deed Income Deed Deed Moderate-
4,5+.ADU,MH) O=Owner Restricted Restricted Restricted Restricted Restricted Restricted Income
0 0 111 0 56 22 359
ADU Renter 1
SFD Owner 1
ADU Renter 1
ADU Renter 1
SFD Owner 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
SFD Owner 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
ADU Renter 1
SFD Owner 1
2/4/2020 Renter 2
SFA Owner 12
2/4/2020 Owner 1
SFD Owner 7
ADU Renter 1
SFA Owner 22
SFA Owner 19
SFD Owner 17
5+ owner 11
ADU Renter 1
SFD Owner 1
SFD Owner 1
ADU Renter 1
SFD Owner 1
ADU Renter
1
SFD Owner 1
SFA Owner 7
SFD owner 1
ADU Renter 1
ADU Renter 1
SFD Owner 1
ADU Renter 1
SFD Owner 1
5+ Renter 101
5+ Renter 56 207
SFD Owner 5
Note: "+" indicates an optional field
Cells in grey contain auto-calculation formulas
Housing with Financial Housing without Term of
Affordability Streamlining Infill Assistance and/or Deed Financial Assistance or or Deed Demolished/Destroyed Units Notes
Restrictions Deed Restrictions Restriction
11 12 13 14 15 16 17 18 19 20 21
Certificates of # of Units was Project Assistance For uni!$ affordable without Term of
Occupancy or issued How many of ~ Programs for Deed llnanchll assistance or deed Affordability or Number of DemoUshed/D other forms of uslngGC Restriction restllctions, explain how the Deed Restriction DemoHohed Certificates of tlleunltswont Infill Units? Each Demolished/ estroyed readiness Occupancy or Extremely Low 85913.4(1>)? YIN• Development Type locality determined the units (yeers) or Destroyed or Destroyed Units OWner Notes•
{see other forms of Income?" (8835 (see (see were affordable affordable In Units• Units• or Renter• instructions) Streamlining) instructions) (see Instructions) pe,petuity enter
~ readiness YIN Instructions) 1000)'
548 0 0 6 0 0
4/23/2019 1 N Developer survey
3/6/2019 1 N
3/6/2019 1 N Developer survey
2/14/2019 1 N Developer survey
1/30/2019 1 N
4/1/2019 1 N Developer survey
1/31/2019 1 N Developer survey
10/22/2019 1 N Developer survey
7/30/2019 1 N Developer survey
4/23/2019 1 N Developer survey
2/1/2019 1 N
8/9/2019 1 N Developer survey
10/17/2019 1 N Developer survey
10/29/2019 1 N Developer survey
11/18/2019 1 N Developer survey
11/18/2019 1 N Developer survey
8/12/2019 1 N Developer survey
10/17/2019 1 N Developer survey
3/19/2019 1 N Developer survey
3/11/2019 1 N
12/30/2019 2 N 2 Demolished
11/20/2019 12 N
8/16/2019 1 N 2 Demolished
4/22/2019 7 N 1 Demolished
4/23/2019 1 N INC
4/8/2019 22 N
1117/2019 19 N
817/2019 17 N
6/3/2019 11 N
4/4/2019 1 N Developer survey
9/18/2019 1 N
12/17/2019 1 N
3/5/2019 1 N Developer survey
7/16/2019 1 N
5/28/2019 1 N
Developer survey
7/19/2019 1 N
12/9/2019 7 N 1 Demolished
317/2019 1 N
317/2019 1 N INC
8/29/2019 1 N Developer survey
8/12/2019 1 N
10/23/2019 1 N Developer survey
10/23/2019 1 N
3/25/2019 101 N INC
1/2/2019 263 N INC
3/18/2019 5 N
March 24, 2020 Item #2 Page 9 of 33
Certificates of # of Units Was Project Assistance For units affordable Without Term of
Tenure Very LOW• Moderate• Occupancy or issued How many of aeeBm!s!t Programs for Deed financial assistance or deed Atronlablllty or Number of Demolished/D Local Unit Category Very LOW· Low.Jncome Low-Income Moderate-Above other forms of uslngGC Restriction restrlcUons, explain how tbe Deed Restriction Demollshed Income Non Income Non Certificates of the units were Infill Units? Each Demolished/ estroyed PrlorAPN• CummtAPN Street AdclTess Project Name• Jurisdiction (SFA,SFD,2 lo Income Deed Deed Non Deed Income Deed Moderate-readiness 68913.,i(b)? Type locality determined the units {years) (If or Destroyed Notes• R=Renter Deed Deed Occupancy or Extremely Low YM Development Destroyed Units Owner Tracking 10• 4,5+ ,ADU,MH) O-OWner Restricted Restricted Restricted Restricted Restricted Restricted Income (see other forms of Income?• (SB35 (see , ... were-able affordabl8 In Units• Units• or Renter" Instructions} Streamlining) Instructions) {see instructions) pe,pewfty enter
~ readiness YIN instructions) 1000).
2150432200 6684 PEREGRINE PL SEASCAPE CB160515 ADU Renter 1 3/5/2019 1 N INC
2081910100 2558 GLASGOW DR THE BLUFFS CBRA2016-SFD Owner 6/24/2019 1 N 0036 1
2081922100 4844 NELSON CT THE RIDGE CBRA2017-SFD Owner 4/25/2019 7 N 0252 7
2081934300 4734 CHASE CT THE TERRACES CBRA2018-SFD Owner 1/30/2019 7 N 0062 7
2081915100 2519 WELLSPRING THE VISTAS CBRA2017-SFD Owner 9/17/2019 1 N ST 0272 1
21326=15 6082 COLT PL 104 UPTOWN BRESSI CBRA2019-SFA Owner 12/16/2019 22 N INC RANCH 0113 5 17
2072301900 4812 KELLY DR WHITE ADU CBR2018-0119 ADU Renter 1 3/26/2019 1 N Developer survey
1562206100 1710YADAPL YADAFARM CBRA2018-SFD Owner 11/6/2019 5 N 0057 5
1562200100 1732YADA PL YADAFARM CBRA2018-ADU Renter 11/5/2019 2 N INC 0077 2
March 24, 2020 Item #2 Page 10 of 33
Jurisdiction Carlsbad
Reporting Year 2019 (Jan. 1 -Dec. 31)
1
RHNA Allocation Income Level by Income Level 2013
I
Deed Restricted 912 35
Very Low Non-Deed Restricted
Deed Restricted 693 27
Low Non-Deed Restricted 2
Deed Restricted 1062 Moderate Non-Deed Restricted 104
Above Moderate 2332 1136
Total RHNA 4999
Total Units 1304
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 §6202)
Table B
This table is auto-populated once you enter your jurisdiction name and current year data. Past
year information comes from previous APRs.
Please contact HCD if your data is different than the material supplied here
Regional Housing Needs Allocation Progress
Permitted Units Issued by Affordability
2 3
Total Units to 2014 2015 2016 2017 2018 2019 2020 2021 Date (all years)
7 44 2
6 9 163 8 4 47 272 1 2 1 2
56 316 13 20 18 18 28 59
235 200 439 624 210 212 3056
255 229 683 652 243 322 3688
Note: units serving extremely low-income households are included in the very low-income permitted units totals
Cells in grey contain auto-calculation formulas
4
Total Remaining
RHNA by Income
Level
868
421
746
0
2035 I
March 24, 2020 Item #2 Page 11 of 33
Jurisdiction
Reporting Year
APN
Carlsbad
2019
en:1 - uec.
31)
Project Identifier
1
Street Address Project Name ..
Summary Row: Start Data Entry Below
Date of Rezone
2
Local
Jurisdiction Date of Rezone
T~eklnnlO•
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 §6202)
Table C
Sites Identified or Rezoned to Accommodate Shortfall Housina Need
RHNA Shortfall by Household Income Category Type of
shortfall
3 4 5 . 6
Very LOW• Moderate-I Above Type of Parcel Size General Plan Low-Income Moderate-Shortfall Income Income Income (Acrest Designation
0 0 0 0 ..
'· ~-~~ ,,. .. ,
.. ., . .. ,
•· •.·
•, .•.
~ •• °: • • ~. ;-_t;:,
Sites Description
7 8 9 10 11
Minimum Maximum Realistic Vacant#Nonvac Description of Zoning Density Density
ADowed a......., Capacity ant Existing Uses
0
March 24, 2020 Item #2 Page 12 of 33
Jurisdiction
Renortlna Year
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 ~6202'
Carlsbad
2019 (Jan. 1 -Dec. 31 l I
Table D
Program Implementation Status pursuant to GC Section 65583
.................... -Rlport
Describe pn,giw of al piog1•111 lncludq local elorls to nimove govemmeial COi ..... to .. melnlll•a. lmpnMlmenl. and dallelapmant of hauling• ldlnllllad In a. hoUllng---.
1 I s 4
..... ., Program ~ llMfl ........ .......,,,..... ..............
The city will continue to discourage and/or restrict condominium
conversions when such conversions would reduce the number of low or
1.1 -Condominium moderate income housing units available throughout the city. All The city considers condominium conversions on a case by case basis. In 2019, there
Conversion condominium conversions are subject to the city's lnclusionary Housing 0 were no condominium conversions approved. Ordinance; the in-lieu fees or actual affordable units required by the
ordinance would be used to mitigate the loss of affordable rental units
from the city's housing stock.
The city will continue to implement the city's Residential Mobile Home
1 .2 -Mobile Home Park zoning ordinance (Municipal Code Chapter 21.37) that sets 0 The city continues to implement the mobile home zoning ordinance. No applications for
Park Preservation conditions on changes of use or conversions of mobile home parks, change in use or conversion of a mobile home park were received in 2019.
consistent with Government Code Section 66427 .5.
The city will also assist lower income tenants of mobile home parks to
research the financial feasibility of purchasing their mobile home parks
so as to maintain the rents at levels affordable to its tenants.
1.3 -Acquisition/ The city will continue to provide assistance on a case-by-case basis to Requests for acquisition/rehabilitation of rental properties are considered on a case by Rehabilitation of preserve the existing stock of lower and moderate income rental 0
Rental Housing housing, including: case basis.
Provide loans, grants, and/or rebates to owners of rental In Spring of 2019, the City Council approved the CDBG Annual Action Plan to authorize
properties to make needed repairs and rehabilitation. the purchase of existing affordable housing units in Carlsbad. In 2019, the city
purchased three units with these funds in the Mulberry community of Bressi Ranch.
As financially feasible, acquire and rehabilitate rental
housing that is substandard, deteriorating or in danger of being
demolished. Set-aside at least 20 percent of the rehabilitated
units for extremely-and/or very low income households.
March 24, 2020 Item #2 Page 13 of 33
............... OIIIN•• ,,..,._ .. tf.E ..... .......................... I
As appropriate and determined by City Council, provide
deferral or subsidy of planning and building fees, and priority
processing. Priority will be given to repair and rehabilitation of
housing identified by the city's Building Division as being
substandard or deteriorating, and which houses lower income '
and in some cases moderate income households.
As the housing stock ages, the need for rehabilitation assistance may
increase. The city will provide assistance to homeowners to rehabilitate
deteriorating housing. Eligible activities under this program include
1.4 -Rehabilitation of such things as repairing faulty plumbing and electrical systems, The city has implemented a Minor Home Repair Grant Program for low-income owner-
Owner-Occupied replacing broken windows, repairing termite and dry-rot damage, and 0 occupied properties that provides loans of up to $5,000, which are forgiven after five
Housing installing home weatherization improvements. Assistance may include years. In 2019, the city assisted one household.
financial incentives in the form of low interest and deferred payment
loans, and rebates. Households targeted for assistance include lower-
income and special needs (disabled, large, and senior) households.
One project within the city-Santa Fe Ranch Apartments-may be
considered as at risk if the owner pays off bonds early. While this is
unlikely since the current income at affordable levels is not substantially
1.5 -Preservation of lower than the potential income at market rates, the city will nonetheless In 2016, the property owners of the Santa Fe Ranch Apartments paid off the bonds,
At-Risk Housing monitor its status. Through monitoring, the city will ensure tenants C removing the affordability provisions. Given that there are no more ·at risk" housing
receive proper notification of any changes. The city will also contact units in the city, this program is considered to be completed.
nonprofit housing developers to solicit interest in acquiring and
managing the property in the event this or any similar project becomes
at risk of converting to market rate.
The city will continue to monitor the absorption of residential acreage in The city reviews residential development applications for compliance with meeting the
2.1 -Adequate Sites all densities and, if needed, recommend the creation of additional minimum densities on which the city relies to meet its share of regional housing needs.
to Accommodate the residential acreage at densities sufficient to meet the city's housing 0 Consistent with state law and the city's land use policies, the city shall not approve
RHNA need for current and future residents. Any such actions shall be applications below the minimum densities established in the Housing Element unless it
undertaken only where consistent with the Growth Management Plan. makes the following findings:
March 24, 2020 Item #2 Page 14 of 33
... of~ Ollf■cllwe 1111■ .... ln H.E ............................... l
The analysis in Section 10.3 (Resources Available) identifies examples a. The reduction is consistent with the adopted general plan, including the housing
of how housing has been built on very small sites, such as in the Village element.
and Barrio. However, to expand opportunities for additional affordable
housing, the city will encourage the consolidation of small parcels in b. The remaining sites identified in the housing element are adequate to
order to facilitate larger-scale developments that are compatible with accommodate the city's share of the regional housing need pursuant to
existing neighborhoods. Specifically, the city will continue to make Government Code Section 65584.
available an inventory of vacant and underutilized properties to
interested developers, market infill and redevelopment opportunities The city continues to make available an inventory of vacant and underutilized
throughout the city, including the Village and Barrio, and meet with properties and works with interested developers on infill and redevelopment
developers to identify and discuss potential project sites. opportunities.
The Planning Division, in its review of development applications, may
recommend waiving or modifying certain development standards, or
propose changes to the Municipal Code to encourage the development
2.2 -Flexibility in of low and moderate income housing. The city offers offsets to assist in The city considers density increases, waivers and modifications to development Development the development of affordable housing citywide. Offsets include 0
Standards concessions or assistance including, but not limited to, direct financial standards to assist in the development of affordable housing on a case by case basis.
assistance, density increases, standards modifications, or any other
financial, land use, or regulatory concession that would result in an
identifiable cost reduction.
In 2019, the following projects were reviewed or approved and included density
increases and/or modifications to development standards:
· The city is currently reviewing the EIR 2018-0001 -Aviara Apartments, which is
proposing a density increase of 105 units above the General Plan allocation of 224
units, for a total of 329 units. The project is currently proposing 82 affordable units,
which exceeds the requirements of the lnclusionary Housing ordinance. The Aviara
Apartments project proposal includes a request for a modification to the following
development standards: building height, fence/wall height, parking ratios, side yard
setback for carport structures, and parking lot perimeter landscape buffer
requirements.
The city will encourage mixed-use developments that include a
2.3 -Mixed Use residential component. Major commercial centers should incorporate, 0 The city considers mixed use developments on a case by case basis.
where appropriate, mixed commercial/residential uses.
The following mixed-use projects were under review or approved in the Village area in
2019:
RP 15-16 4 Plus 1 Luxury Living was approved, which includes four residential
units and 1,105 square feet of commercial space.
March 24, 2020 Item #2 Page 15 of 33
Nameof ......... _.. Tlmlfl•••IIIHJ! ...... of ............ , •• ... •• I
SOP 2019-0015 Jefferson Street Apartments was under review, which proposes
15 residential units and 2,625 square feet of commercial space.
CT 2019-0003 Carlsbad Station was under review, which proposes 79 residential
unfts and 9,777 square feet of commercial space.
CT 2018-0008 Grand Jefferson was under review, the city reviewed CT 2018-0008
Grand Jefferson, which proposes six residential units and 1,823 square feet of
commercial space.
Outside of the Village area, the following mixed-use projects were under review or
approved in 2019:
EIR 2017-0001 -Marja Acres was under review, which proposes 248
town homes, 46 senior affordable apartments, and 10,000 sf of commercial space and
community recreation uses.
EIR 2018-0004 North County Plaza was under review, +which proposes to
redevelop an existing shopping center by demolishing a portion of the center (approx.
40,000 sf of commercial space) and adding 272 apartment units, resulting in a mixed
use site.
The city has established requirements, programs, and actions to
improve household energy efficiency, promote sustainability, and lower The city continues to implement its 2015-adopted Climate Action Plan (CAP). In 2019,
2.4 -Energy utility costs. The city shall enforce state requirements for energy 0 the City Council adopted ordinances identified in the CAP to promote energy efficiency
Conservation conservation, including the latest green building standards, and and renewable energy use in new residential construction and in existing development
promote and participate in regional water conservation and recycling undergoing major upgrades. The ordinances become fully enforceable on Jan. 1, 2020.
programs.
Create a coordinated energy conservation strategy, including
strategies for residential uses, as part of a citywide Climate Action
Plan.
In the Village, encourage energy conservation and higher density In 2018, the California Building Standards Commission approved amendments to the
development by the modification of development standards (e.g. California Energy Code requiring installation of photovoltaic systems in all new low-rise
parking standards, building setbacks, height, and increased density) residential construction, beginning in January 2020. Carlsbad is enforcing this new
as necessary to: Energy Code requirement as of Jan. 1, 2020.
-Enable developments to qualify for silver level or higher
LEED (Leadership in Energy and Environmental Design) In 2019, 1,279 building permits for photovoltaic panels on residential structures were Certification, or a comparable green building rating, and to
maintain the financial feasibility of the development with such completed.
certification.
March 24, 2020 Item #2 Page 16 of 33
Name GI Program Ollljullwe TIIMl'I•• Ill H.E .... o1,....... .... , .......... I
-Achieve densities at or above the minimum required if the
applicant can provide acceptable evidence that application of the In 2019, the city adopted the 2019 California Building Codes, which incorporates the
development standards precludes development at such latest energy efficiency standards as established by the CEC.
densities.
Facilitate resource conservation for all households by making
available, through a competitive process, CDBG funds to non-profit In 2019, the city reviewed and approved several infill projects in the Village and Barrio organizations that could use such funds to replace windows, areas (see comments in Programs 2.1 through 2.3 above.) plumbing fixtures, and other physical improvements in lower-income
neighborhoods, shelters, and transitional housing.
Encourage infill development in urbanized areas, particularly in
the Village and Barrio, through implementation of the Village Master
Plan and Design Manual and the allowed density ranges in the Barrio.
The city will continue to implement its lnclusionary Housing Ordinance, On Dec. 17, 2019, the City Council introduced Ordinance No. CS-368 to restore the
which requires a minimum of 15 percent of all ownership and qualifying city's ability to apply inclusionary housing requirements to residential rental units. Prior to
3.1 -lnclusionary rental residential projects of seven or more units be restricted and 0 passage of AB 1505 in 2017, cities and counties were barred from imposing affordable
Housing Ordinance affordable to lower income households. This program requires an housing requirements to rental projects, as a result of the appellate court decision in
agreement between all residential developers subject to this Palmer/Sixth St. Properties, L. P. v. City of Los Angeles. AB 1505 revoked the Palmer
inclusionary requirement and the city which stipulates: decision by allowing cities to impose affordability restriction to new rental housing again.
The city continues to implement its lnclusionary Housing Ordinance. In 2019, building
The number of required lower income inclusionary units; permits were issued for 47 dwelling units that were required to be affordable through
lnclusionary requirements for the following projects:
The designated sites for the location of the units;
A phasing schedule for production of the units; and Yada Farm -one low income ADU
The term of affordability for the units. Uptown Bressi Ranch -17 low income condominiums
Poinsettia 61 -five low income ADUs
March 24, 2020 Item #2 Page 17 of 33
..... .,.....,... OlljntM ,_,. ......... ......, ............... 111ft I
For all ownership and qualifying rental projects of fewer than seven
units, payment of a fee in lieu of inclusionary units is permitted. The fee
is based on a detailed study that calculated the difference in cost to Magnolia Brady -one low income ADU produce a market rate rental unit versus a lower-income affordable unit. Miles Buena Vista -one low income ADU As of 2013, the in-lieu fee per market-rate dwelling unit was $4,515. Casa Aldea -20 low income senior apartments The fee amount may be modified by the City Council from time-to-time Beachwalk at Roosevelt -two low income condominiums and is collected at the time of building permit issuance for the market
rate units. The city will continue to utilize inclusionary in-lieu fees
collected to assist in the development of affordable units.
The city will apply lnclusionary Housing Ordinance requirements to Work was completed on significant affordable housing projects that began construction rental projects if the project developer agrees by contract to limit rent as in 2016: consideration for a "direct financial contribution" or other form of
assistance specified in density bonus law; or if the project is at a density Construction was completed for the 101 unit low income senior apartments (Portola that exceeds the applicable GMCP density, thus requiring the use of Senior Apartments) and 56 moderate income apartments (Montecito Apartments) in "excess dwelling units," as described in Section 10.3 (Resources Robertson Ranch West Village Master Plan. Available).
In 2019, building permits were issued for the following projects that were required to
purchase lnclusionary Housing credits at existing affordable apartments:
EIR 15-03 Poinsettia 61 -four credits
CT 2018-0001 Walnut Beach Homes -two credits
CY 2017-0002 Tyler Street Residences -one credit
In 2019, the in-lieu fee per market rate dwelling unit remained at $4,515, which has not
changed since 1996.
Pursuant to City Council Policy Statement 43, the city will continue to Through its continued implementation of the Growth Management Plan, the city tracks
3.2 -Excess Dwelling utilize "excess dwelling units," described in Section 10.3 (Resources development and the Excess Dwelling Unit Bank in its monthly Development Monitoring
Available), for the purpose of enabling density transfers, density 0 Report. As of December 2019, the excess unit balance was 533 dwelling units inside Units increases/bonuses and General Plan amendments to increase allowed the Village and 425 units outside of the Village. These units are available for qualifying
density. projects, which include affordable housing and density bonuses.
Based on analysis conducted in Section 10.4 (Constraints and
Mitigating Opportunities), the city can accommodate its 2010-2020
RHNA without the need to utilize excess dwelling units to accommodate
the RHNA at each household income level.
March 24, 2020 Item #2 Page 18 of 33
..... ofPl'opan ~ ~11111.E -of P,..,_ II -••111111111 l
Consistent with state law (Government Code sections 65913.4 and
65915), the city continues to offer residential density bonuses as a
means of encouraging affordable housing development. In exchange
for setting aside a portion of the development as units affordable to
3.3 -Density Bonus lower and moderate income households, the city will grant a density 0/C The city continues to make available density bonuses in compliance with state density
bonus over the otherwise allowed maximum density, and up to three bonus law (SDBL). In 2019, six SDBL applications were either received or under review:
financial incentives or regulatory concessions. These units must
remain affordable for a period of no less than 30 years and each project
must enter into an agreement with the city to be monitored by the
Housing and Neighborhood Services Division for compliance.
EIR 2017-0001 Marja Acres, which proposes 248 townhomes, 46
' affordable senior apartments and 10,000 sf of commercial space.
The density bonus increases with the proportion of affordable units set
aside and the depth of affordability (e.g. very low income versus low
income, or moderate income). The maximum density bonus a SOP 2018-0004 Romeria Pointe Apartments, which proposes 3 very
developer can receive is 35 percent when a project provides 11 percent low units and 20 market rate units.
of the units for very low income households, 20 percent for low income
households, or 40 percent for moderate income households.
EIR 2018-0004 North County Plaza, which proposes to redevelop an
existing shopping center by demolishing a portion of the center (approx.
40,000 sf of commercial space) and adding 272 apartment units, resulting in
a mixed use site.
Financial incentives and regulatory concessions may include but are not
limited to: fee waivers, reduction or waiver of development standards, in SOP 2018-0022 Resort View Apartments, which proposes 4 low kind infrastructure improvements, an additional density bonus above income units and 22 market rate units. the requirement, mixed use development, or other financial
contributions.
CT 2019-0003 Carlsbad Station, which proposes 12 low income units
and 67 market rate units.
The city is currently amending its density bonus regulations (Municipal SOP 2019-0015 Jefferson Street Apartments which proposes 3 low Code Chapter 21.86) to ensure consistency with recent changes to
state density bonus law. income and 15 market rate units.
The city also offers density increases through its inclusionary housing program as
provided for in Municipal Code Chapter 21.85, see Program 2.2 -Flexibility in
Development Standards.
March 24, 2020 Item #2 Page 19 of 33
...... or,-...,...
3.4 -City-Initiated
Development
3.5 -Affordable
Housing Incentives
3.6 -Land Banking
The city, through the Housing and Neighborhood Services Division, will
continue to work with private developers (both for-profit and non-profit)
to create housing opportunities for low, very low and extremely low
income households.
The city will consider using Housing Trust Funds on a case-by-case
basis to offer a number of incentives to facilitate affordable housing
development. Incentives may include:
Payment of public facility fees;
In-kind infrastructure improvements, including but not
limited to street improvements, sewer improvements, other
infrastructure improvements as needed;
Priority processing, including accelerated plan-check
process, for projects that do not require extensive engineering or
environmental review; and
Discretionary consideration of density increases above the
maximum permitted by the General Plan through review and
approval of a site development plan (SDP).
The city will continue to implement a land banking program to acquire
land suitable for development of housing affordable to lower and
moderate income households. The land bank may accept contributions
of land in-lieu of housing production required under an inclusionary
requirement, surplus land from the city or other public entities, and land
otherwise acquired by the city for its housing programs. This land
would be used to reduce the land costs of producing lower and
moderate income housing by the city or other parties.
Tlln1hnle Ill H.E
0
0
0
..... .,,,..,.. ............. .
The city's density bonus regulations (Municipal Code Chapter 21 .86) have been
amended consistent with state law through 2019. These amendments had their first
reading on 12/17/19 and were approved by the city council 1/28/20. Additional revisions
are being prepared for consistency with state law changes through 2020.
The city continues to provide information and work with developers to assist them in
creating additional housing opportunities for lower income households.
The city continues to offer incentives to facilitate affordable housing, including those
listed in Program 2.2 above and Program 3.5.
The city continues to implement a land banking program to acquire land suitable for
development of housing affordable to lower and moderate income households. In 2019,
there were no offers to donate land for affordable housing.
I
March 24, 2020 Item #2 Page 20 of 33
3.7 -Housing Trust
Fund
3.8 -Section 8
Housing Choice
Vouchers
3.9 -Mortgage Credit
Certificates
The city has identified a list of nonprofit developers active in the region.
When a city-owned or acquired property is available, the city will solicit
the participation of these nonprofits to develop affordable housing.
Affordable housing funds will be made available to facilitate
development and the city will assist in the entitlement process.
The city will continue to maintain the Housing Trust Fund for the
fiduciary administration of monies dedicated to the development,
preservation and rehabilitation of affordable housing in Carlsbad. The
Housing Trust Fund will be the repository of all collected in-lieu fees,
impact fees, housing credits, loan repayments, and related revenues
targeted for proposed housing as well as other local, state and federal
funds.
The city will explore additional revenue opportunities to contribute to the
Housing Trust Fund, particularly, the feasibility of a housing impact fee
to generate affordable rental units when affordable units are not
included in a rental development.
The Carlsbad Housing Authority will continue to administer the city's
Section 8 Housing Choice Voucher program to provide rental
assistance to very low income households.
The city participates in the San Diego Regional Mortgage Credit
Certificate (MCC) Program. By obtaining a MCC during escrow, a
qualified homebuyer can qualify for an increased loan amount. The
MCC entitles the homebuyer to take a federal income tax credit of 20
percent of the annual interest paid on the mortgage. This credit
reduces the federal income taxes of the buyer, resulting in an increase
in the buyer's net earnings.
The city will continue to encourage a wide variety of senior housing
opportunities, especially for lower-income seniors with special needs,
through the provision of financial assistance and regulatory incentives
3.10 -Senior Housing as specified in the city's Housing for Senior Citizens Ordinance
(Municipal Code Chapter 21.84). Projects assisted with these
incentives will be subjected to the monitoring and reporting
requirements to assure compliance with approved project conditions.
0
0
C
0
I
The city continues to maintain the Housing Trust Fund, which had a total balance of
approximately $17.8 million as of December 31, 2019. However, the available balance
is approximately $13.6 million as the city had committed $4.25 million for the affordable
Oak Veterans Housing and Harding Veterans Housing projects in 2017.
In 2019, the city did not approve any requests for Housing Trust Fund money for
affordable housing projects.
The Housing Authority continues to operate Section 8 Housing Choice Voucher
Program. The $6.5 million federally funded program assisted approximately 600
households in 2019.
The city no longer participates in the MCC Program.
The city continues to encourage senior housing opportunities through financial
assistance and regulatory incentives.
March 24, 2020 Item #2 Page 21 of 33
3.11 -Housing for
Persons with
Disabilities
3.12 -Housing for
Large Families
In addition, the city has sought and been granted California Constitution
Article 34 authority by its voters to produce up to 2Q0 senior-only, low-
income restricted housing units. The city would need to access its
Article 34 authority only when it provides financial assistance and
regulates more than 51 percent of the development.
The city has an adopted ordinance to provide individuals with
disabilities "reasonable accommodation" in land use, zoning and
building regulations. This ordinance seeks to provide equal opportunity
in the development and use of housing for people with disabilities
through flexibility in regulations and the waiver of certain requirements
in order to eliminate barriers to fulfilling this objective.
The city will continue to evaluate the success of this measure and
adjust the ordinance as needed to ensure that it is effective. Moreover,
the city will seek to increase the availability of housing and supportive
services to the most vulnerable population groups, including people with
disabilities through state and federal funding sources, such as HUD's
Section 811 program and CDBG funding.
In those developments that are required to include 10 or more units
affordable to lower-income households, at least 1 0 percent of the lower
income units should have three or more bedrooms. This requirement
does not pertain to lower-income senior housing projects.
Carlsbad will continue to facilitate and assist with the acquisition, for
3.13 -Housing for the lease or sale, and development of suitable sites for emergency shelters
Homeless and transitional housing for the homeless population. This facilitation
and assistance will include:
0
0
0
..... .,.....,_ .............. .
In 2019, progress was made on the following senior housing projects:
Casa Aldea/Cannon Road Senior Housing (MP 02-03(H)/ SOP 15-19) -the city
issued building permits in 2019 and the project is curre_ntly under construction. The
project consists of 98 unit senior apartments, of which 20 units will be restricted to low
income residents.
As part of the inclusionary requirement for the Robertson Ranch West Village
Master Plan, construction was completed for the 101 unit Portola Senior Apartments.
The project includes one and two bedroom units that are restricted to 70 percent of
AMI, and is now open and completely leased up.
The city reviewed an application for EIR 2017-0001 -Marja Acres, which proposes
46 senior affordable apartments as part of a mixed use project.
The city continues to consider requests for "reasonable accommodation' in land use.
zoning and building regulations on a case by case basis. One reasonable
accommodation request was received in 2019.
The city continues to implement this program as part of its inclusionary housing
ordinance. In 2019, 13 permits were issued for three-bedroom affordable units.
Solutions for Change continues to operate a 16-unit apartment complex that provides
permanent affordable housing opportunities for homeless families who have graduated
from the Solutions University. In 2015, the property was acquired (with financial help
from the city) and families began moving into the property.
Catholic Charities continues to operate the La Posada de Guadalupe emergency
shelter, of which a portion of the facility (50 beds) is devoted to serving homeless men.
l
March 24, 2020 Item #2 Page 22 of 33
3.14 -Supportive
Services for
Homeless and
Special Needs
Groups
Participating in a regional or sub-regional summit(s) including
decision-makers from north San Diego County jurisdictions and
SAN DAG for the purposes of coordinating efforts and resources to
address homelessness;
Assisting local non-profits and charitable organizations in securing
state and federal funding for the acquisition, construction and
management of shelters; and
Continuing to provide funding for local and sub-regional homeless
service providers that operate temporary and emergency shelters.
The city will continue to provide CDBG funds to community, social
welfare, non-profit and other charitable groups that provide services for
those with special needs in the north San Diego County area.
Furthermore, the city will work with agencies and organizations that
receive CDBG funds to offer a city referral service for homeless shelter
and other supportive services.
The city will continue to implement its Second Dwelling Unit Ordinance
3.15 -Alternative (Section 21 .10.015 of the Carlsbad Municipal Code) and will continue to
Housing support alternative types of housing, such as hotels and managed living
units to accommodate extremely-low income households.
Tllawrt&..elftH.I
0
0
I
The city continues to implement the Homeless Response Plan, which has established
key principles and system responses that the city employs to address the community
impacts of homelessness. The plan provides strategies to:
1. Prevent, reduce and manage homelessness in Carlsbad;
2. Support and build capacity within the city and community to address
homelessness;
3. Encourage collaboration within the city, community partnerships and
residents; and
4. Retain, protect and increase the supply of housing.
In 2018, a Housing Set-Aside pilot program was launched at the city-owned Tyler
Court senior affordable apartment community whereby ten (10) units were set-aside
specifically for formerly homeless seniors. Staff identified and transitioned six (6)
individuals into permanent housing. The pilot program was discontinued in summer
2019. As of Dec. 31 , 2019, five of those residents were still successfully housed at Tyler
Court.
During the 2019-2020 CDBG program year, the city allocated $74,872in funding
assistance to five social service providers in North County which provide shelters and
support services for the homeless community.
The city continues to implement the Second Dwelling Unit Ordinance and consider
alternative types of housing. In 2019, building permits were issued for 33 accessory
dwelling units.
The city is currently in process preparing zoning code amendments to address changes
in state laws pertaining to accessory dwelling units that were signed into law in 2019 and
became effective January 1, 2020 (SB 13, AB 68, AB 881, AB 670, AB 587 and AB
671).
A one-year seniors home share matching program was launched in 2019. Seven
residents were matched to a home provider during the year.
March 24, 2020 Item #2 Page 23 of 33
..... .,.....,.. OlljmM TlmaflwM In H.& ...._.,......,_llllpl1n•lll1n I
The city will assure that information on the availability of assisted or
3.16 -Military and below-market housing is provided to all lower-income and special needs The city provides information on assisted and below market housing to individuals and groups. The Housing and Neighborhood Services Division will provide 0 groups needing that information. Student Referrals information to local military and student housing offices of the
availability of low-income housing in Carlsbad.
As a function of the building permit process, the city will monitor and
record Coastal Zone housing data including, but not limited to, the
following:
1. In 2019, building permits were issued for 77 dwelling units in the Coastal Zone:
Four units in 2-4 unit structures 1. The number of housing units approved for construction, 16 accessory dwelling units conversion or demolition within the coastal zone after January 1, Eight single family attached dwellings 1982. 49 single family detached dwellings
2. The number of housing units for persons and families of low or 2. In 2019, building permits were issued for five accessory dwelling units that were moderate income, as defined in Section 50093 of the Health and required to be affordable at the low income level through the lnclusionary Housing Safety Code, required to be provided in new housing developments Ordinance (as a part of the EIR 15-03 Poinsettia 61 project). within the coastal zone.
3.17 -Coastal 0 Housing Monitoring 3. The number of existing residential dwelling units occupied by
persons and families of low or moderate income that are authorized 3. None. to be demolished or converted in the coastal zone pursuant to
Section 65590 of the Government Code.
4. The number of residential dwelling units occupied by persons
and families of low or moderate income, as defined in Section
50093 of the Health and Safety Code that are required for
replacement or authorized to be converted or demolished as 4. None. identified above. The location of the replacement units, either
onsite, elsewhere within the city's coastal zone, or within three
miles of the coastal zone in the city, shall be designated in the
review.
First, to retain the Housing Element as a viable policy document, the
Planning Division will review the Housing Element annually and
schedule an amendment if necessary. As required by state law, city The city will continue its annual reporting. staff will prepare and submit annual progress reports to the City
Council, SANDAG, and California Department of Housing and
Community Development (HCD).
March 24, 2020 Item #2 Page 24 of 33
...... GfProgram Olljectlve TIIMhmelnH.E ...... Gf..,...... ......... , .... 111 I
Second, Senate Bill 575 requires that a jurisdiction revise its housing
element every four years, unless it meets both of the following criteria:
(1) the jurisdiction adopted the fourth revision of the element no later
than March 31 , 201 O; and (2) the jurisdiction completed any rezoning The mid-planning period (2017-2021) Housing Element update was completed in 2017.
contained in the element by June 30, 2010. While implementation of On December 20, 2016, HCD issued a letter stating that the update meets the statutory
3.18 -Housing the city's 2005-2010 Housing Element satisfied the first criterion, it did requirements of State housing element law, and the Housing Element update was
Element Annual not meet the second. Although rezoning was completed before the end adopted by the City Council in March 2017.
Progress Report and of the extended Housing Element period (April 30, 2013) to satisfy the
Mid-Planning Period adequate sites program, it was not completed in time to meet the SB 0
Housing Element 575 requirement.
Update
The city will build on the annual review process to develop a mid-The city has selected a consultant for the 2021-2029 Housing Element update and kick-planning period (four-year) Housing Element update that includes the
following: off meetings are scheduled for February 2020.
Review program implementation and revision of programs and
policies, as needed;
Analysis of progress in meeting the RHNA and updates to the
sites inventory as needed;
Outcomes from a study session that will be held with the Planning
Commission to discuss mid-period accomplishments and take public -
comment on the progress of implementation. The city will invite
service providers and housing developers to participate.
With assistance from outside fair housing agencies, the city will
continue to offer fair housing services to its residents and property
owners. Services include:
Distributing educational materials to property owners, apartment
managers, and tenants; With the assistance of a CDBG grant, the city contracts with the Legal Aid Society of
Making public announcements via different media (e.g. newspaper San Diego (LASSO), a non-profit organization dedicated to serving the needs of our
4.1 -Fair Housing ads and public service announcements at local radio and television community, to provide their services to Carlsbad residents and property owners. LAS SD
Services channels); 0 serves as advocates for fair housing and mediating tenanVlandlord issues. Through the
Fair Housing Initiatives Program, LASSO assists clients with potential discrimination
Conducting public presentations with different community groups; claims and will provide guidance on fair housing laws. Annually, residents are invited to
call LASSO at no charge and receive assistance.
Monitoring and responding to complaints of discrimination (i.e.
intaking, investigation of complaints, and resolution); and
Referring services to appropriate agencies.
March 24, 2020 Item #2 Page 25 of 33
Jurisdiction Carlsbad
Reporting Period 2019 (Jan. 1 -Dec. 31)
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 §6202)
Table E
Commercial Development Bonus Approved pursuant to GC Section 65915.7
Description of
Project Identifier Units Constructed as Part of Agreement Commercial
Development
Bonus
1 2 3
Local Description of
APN Street Address Project Name• Jurisdiction Very Low Low Moderate Above Moderate Commercial
Tracking 10• Income Income Income Income Development
Bon11"'
Summary Row: Start Data Entry Below 0 0 0 0
Commercial
Development
Bonus Date
Annroved
4
Commercial
Development
Bonus Date
Annroved
March 24, 2020 Item #2 Page 26 of 33
NOTE: This table must only be filled out if the housing element sites inventory contains
Jurisdiction Carlsbad a site which is or was owned by the reporting jurisdiction, and has been sold, leased, or
Rep-0rting Period ... _______ _ 201 ?_.~-~----,~~ (J~ 1_ -Dec. 31)_ • otherwise disposed of during the reporting year.
ANNUAL ELEMENT PROGRESS REPORT
Housing Element Implementation
(CCR Title 25 §6202)
Table G
Locally Owned Lands Included in the Housing Element Sites Inventory that have been sold, leased, or otherwise disposed of
Project Identifier
1
APN Street Address Project Name• Local Jurisdiction Tracking Realistic Capacity Identified Entity to whom the site
10· in the Housing Element transferred
Summary Row: Start Data Entry Below
4
Intended Use for Site
March 24, 2020 Item #2 Page 28 of 33
Jurisdiction Carlsbad
Reporting Year 2019 (Jan. 1 -Dec. 31)
Building Permits Issued by Affordability Summary
Income Lev.el Curr«ttYear
Deed Restricted 0
Very Low 2 Non-Deed Restricted
Deed Restricted 47
Low
Non-Deed Restricted 2
Deed Restricted 0
Moderate
Non-Deed Restricted 59
Above Moderate 212
Total Units 322
Note: Units serving extremely low-income households are included in the very low-
income permitted units totals
Housing Appfi<:ations Summary
Total Housing Applications Submitted: 51
Number of Proposed Units in All Applications Received: 436
Total Housing Units Approved: 30
Total Housing Units Disapproved: 0
Use of SB 35 Streamlining Provisions
Number of Applications for Streamlining 0
Number of Streamlining Applications Approved 0
Total Developments Approved with Streamlining 0
Total Units Constructed with Streamlining 0
Unita Constructed -se 35 StreamHnina Permits
Income Remaf Owrlerebif) Total
Very Low 0 0 0
Low 0 0 0
Moderate 0 0 0
Above Moderate 0 0 0
Total 0 0 0
Cells in grey contain auto-calculation formulas
March 24, 2020 Item #2 Page 29 of 33
o Single Family-Attached Unit {SFA) -a one-unit structure attached to
another unit by a common wall, commonly referred to as a townhouse,
half-plex, or row house. The shared wall or walls extend from the
foundation to the roof with adjoining units to form a property line. Each
unit has individual heating and plumbing systems.
o 2-, 3-, and 4-Plex Units per Structure (2-4) -a structure containing two,
three, or four units and not classified as single-unit attached structure.
o 5 or More Units per Structure (5+} -a structure containing five or more
housing units.
o Accessory Dwelling Unit (ADU} -means a unit that is attached, detached
or located within the living area of the existing dwelling or residential
dwelling unit which provides complete independent living facilities for one
or more persons. It shall include permanent provisionsfor living, sleeping,
eating, cooking, and sanitation on the same parcel on which the single-
family dwelling is situated pursuant to Government Code section 65852.2.
An ADU also incl4des the following: an efficiency unit, as defined in
Section 17958.1 of the Health and Safety Code or a manufactured home,
as defined in Section 18007 of the Health and Safety Code.
4 March 24, 2020 Item #2 Page 33 of 33
Council Memorandum
March 24, 2020
To:
From:
Via:
Honorable Mayor Hall and Members of the City Council
Geoff Patnoe, Assistant City Manager
Scott Chadwick, City Manager
{city of
Carlsbad
All Receive -Agenda Item # ~
For the Information of the:
~f~1;,COUNC~
Dat~CA_V_ CCC~
CM ~M ~M (3) L----'
Re: Additional Materials Related to Staff Report Item No. 2 -2019 Housing Element Annual
Progress Report
This memorandum provides recommended clarifying edits to the 2019 Housing Element Annual
Progress Report (Agenda Item No. 2, Exhibit 1 of the staff report), and answers several questions
related to the staff report Item No. 2.
Staff recommended changes to Item No. 2, Exhibit!, the 2019 Housing Element Annual Progress
Report
Page 18, Program 3.1 -Jnclusionary Housing Ordinance. In the column "Status of Program
Implementation", modify the last sentence to read:
In 2019, the in-lieu fee per market rate dwelling unit remained at $4,515, which has not
changed since 1996.
Page 23, Program 3.13 -Housing for the Homeless. In the column "Status of Program
Implementation", modify the last paragraph to read:
In 2018, a Housing Set-Aside pilot program was launched at the city-owned Tyler Court senior
affordable apartment community whereby ten (10) units were set-aside specifically for
formerly homeless seniors. Staff identified and transitioned six (6) individuals into permanent
housing. The pilot program was discontinued in summer 2019. As of Dec. 31, 2019, five of
those residents were still successfully housed at Tyler Court.
Questions and Answers related to Item No. 2
Question 1: Page 16, Program 2.3 -Mixed Use, and page 19, Program 3.3 -Density Bonus. What
is the current status of the proposed mixed-use redevelopment of North County Plaza?
Answer: The application was submitted on December 20, 2018 and remains incomplete. The
project applicant is working with the wildlife agencies, Coastal Commission and the City of
Carlsbad regarding compliance with required buffers from Buena Vista Creek. Resolution of the
buffer requirement is needed prior to making further design changes to the proposed project.
North County Plaza is located just west of the Shoppes at Carlsbad Mall (tenants include
Marshalls, Olive Garden and Souplantation).
Community Services Branch
Community Development Department
1635 Faraday Avenue I Carlsbad, CA 92008 I 760-602-4600 t
Honorable Mayor Hall and Members of the City Council
March 24, 2020
Page 2
Question 2: Page 22, Program 3.10-Senior Housing. Twenty of the 98 apartments in the Casa
Aldea/Cannon Road Senior Housing project will be restricted to low-income residents. For what
income level will the other 78 apartments be rented?
Answer: Twenty of the apartments will be rent-restricted to be affordable to low-income
seniors. The remaining 78 apartments will not be restricted and may rent at market rates.
Question 3: Page 25, Program 3.18-Housing Element Annual Progress Report and Mid-Planning
Period Housing Element Update. Were there any significant changes to the Housing Element that
resulted from the 2017 Housing Element update?
Answer: The 2017 Housing Element Update was prepared by Planning Division staff and
presented for public hearings and consideration by the Housing Commission, Planning
Commission and City Council. The 2017 Housing Element updated information about: recent
changes in housing-related laws, demographics and housing needs, a list of affordable and
market rate housing constructed, under construction and in planning; updated sites inventory to
confirm adequate housing capacity remained t.o meet regional housing needs (RHNA); and minor
updates to Housing Element programs. There were no changes to Housing Element goals and
policies, and no additional housing sites or land use changes were needed to accommodate the
city's RHNA.
Question 4: Page 31, Exhibit 2, Description of Terms and Methods. What discretion does the city
have to determine income levels for affordable housing?
Answer: The city administers several affordable housing programs authorized under federal and
state laws, and local ordinance, including: the federal Section 8 Rental Assistance Program, State
Density Bonus Law, and the Carlsbad lnclusionary Housing Ordinance. With one exception
described below, each of these programs is required to abide by an income categories
framework defined in federal and state law and is not discretionary. Income categories are
defined for extremely-low, very-low, low, and moderate incomes. These categories are
determined as percentages of an area's median income (AMI), which is calculated annually by
the U.S. Department of Housing and Urban Development (HUD). The AMI calculations vary by
region throughout the nation according to formula set by federal law. For the San Diego region
(including Carlsbad), the 2019 AMI for a family of four is $86,300. From this baseline median
income, HUD then calculates income limits for the defined categories and adjusts for household
size according to a methodology set by law.
There is one exception where the city exercises discretion to determine income levels. Under the
city's lnclusionary Housing Ordinance, the maximum affordable low-income rent is limited to 70
percent of AMI. HUD calculates 50 percent (very-low income) and 80 percent (low income) AMI,
but not 70 percent AMI. To implement the lnclusionary Housing Ordinance, the city must
determine the 70 percent income limits, and incorporate them into the HUD-required income
limit schedules for all other income categories. To remain consistent with HUD's income
framework, city staff calculates the household size-adjusted 70 percent income limit by the
following formula:
Honorable Mayor Hall and Members of the City Council
March 24, 2020
Page 3
70% AMlannual = {80% AMlannuai-50% AMlannua1}*l.S, rounded to nearest $50 increment
The resulting 70 percent income limits by household size are then used to determine affordable
rent for the lnclusionary Housing Program.
cc: Celia Brewer, City Attorney
Gary Barberio, Deputy City Manager, Community Services
Jeff Murphy, Community Development Director
Don Neu, City Planner
David de Cordova, Housing Services Manager
Corey Funk, Associate Planner
Sheila Cobian
From:
Sent:
To:
Cc:
Subject:
Attachments:
Importance:
Sheila Cobian
Tuesday, March 24, 2020 3:40 PM
'Barbara Engleson'; Celia Brewer; Gary Barberio; Paz Gomez; Laura Rocha; Scott
Chadwick; Geoff Patnoe
Robin Nuschy; Mia De Marzo; Kristina Ray; Cindie McMahon; Tammy Cloud-McMinn;
Andrea Dykes; Morgen Fry; Jeff Murphy; Shelby Nelson; Kaylin McCauley; David De
Cordova
Additional Information Relating to Item #2 -Affordable Housing Impact Fee Nexus
Study
1601 Sndh -Carlsbad_Nexus Study Update_Report_FINAL_2-18-16.pdf
High
Good Afternoon Mayor & City Council Members,
In response to a City Council Member request, please find attached the Affordable Housing
Impact Fee Nexus Study.
Thank you,
Sheila Cobian, MMC
City Clerk Services Manager
760-434-2917
BC: Mayor & City Council Members
Confidentiality Notice: Please note that email correspondence with the City of Carlsbad, along
with any attachments, may be subject to the California Public Records Act, and therefore may
be subject to disclosure unless otherwise exempt.
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1
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
Carlsbad, California
Prepared for
City of Carlsbad
Keyser Marston Associates, Inc.
February 2016
TABLE OF CONTENTS
SUMMARY AND RECOMMENDATIONS ......................................................................................... 3
INTRODUCTION ............................................................................................................................... 4
APPENDIX I: RESIDENTIAL NEXUS ANALYSIS .............................................................................. 19
INTRODUCTION AND OVERVIEW .................................................................................................. 20
A. Market-Rate Units and Gross Household Income ................................................................... 23
B. The IMPLAN Model .................................................................................................................. 34
C. The KMA Jobs Housing Nexus Model ...................................................................................... 38
D. Mitigation Costs ....................................................................................................................... 49
E. Total Nexus Costs ..................................................................................................................... 51
ADDENDUM: NOTES ON SPECIFIC ASSUMPTIONS .................................................................... 54
APPENDIX II: RESIDENTIAL VALUES-MARKET AND AFFORDABLE.. ......................................... 58
INTRODUCTION AND OVERVIEW ................................................................................................. 59
A. Market Values ......................................................................................................................... 59
B. Affordable Values .................................................................................................................... 76
C. Affordability Gaps ................................................................................................................... 80
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INTRODUCTION
The Summary and Recommendations provides an overview of the analysis and a discussion of
the findings of a residential nexus analysis conducted for the City of Carlsbad (City) to estimate
the impact of market-rate rental housing on the need for affordable housing. As illustrated in
Exhibit 1, the residential nexus analysis quantifies the linkages between new market-rate rental
units and the demand for affordable housing:
Exhibit 1: Nexus Analysis Concept
• newly constructed units
• new households
• new expenditures on goods and services
• new jobs, a share of which are low paying
• new lower income households
• new demand for affordable units ]
The conclusion of the nexus analysis reflects the maximum mitigation impact fee supported to
offset affordable housing demand caused by the development of market-rate rental housing.
A 2009 Court of Appeal ruling stated that a City cannot impose rent control through an
inclusionary requirement on new housing. (Palmer/Sixth Street Properties v. City of Los Angeles
{Palmeri). Nonetheless, market-rate rental housing creates a demand for affordable housing.
The purpose of the nexus study is to analyze the nexus between new market-rate rental
housing development and the need for affordable housing and to calculate a nexus-based
housing impact fee.
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The materials have been prepared by Keyser Marston Associates (KMA) for the City pursuant to
a contractual agreement. The residential nexus analysis addresses market-rate rental housing
developments in the City; the analysis quantifies the linkages between new market-rate rental
units and the demand for affordable housing in Carlsbad.
The City of Carlsbad's existing lnclusionary Housing Ordinance requires all new ownership
residential projects to set aside at least 15% of units so as to be restricted in terms of
occupancy and affordability to lower income households. Lower-income households include
Low-income, Very low-income, and Extremely low-income households, whose gross income
does not exceed 80% of Area Median Income (AMI) for San Diego County as determined
annually by the U.S. Department of Housing and Urban Development (City of Carlsbad
Municipal Code §21.85.020). In accordance with the Palmer ruling, the City of Carlsbad
amended its lnclusionary Housing Ordinance in 2010. As a result, the City no longer applies its
lnclusionary Housing Ordinance to rental developments unless the developer has received
direct financial assistance or other development incentives or concessions from the City and the
developer agrees by contract to limit rents for below market-rate rental units. Developers may
also voluntarily agree to provide inclusionary rental units. A new fee is being considered for
application to market-rate rental developments of any size, which create a need for affordable
housing for low income households.
The Nexus Concept
The underlying nexus concept is that the newly constructed market-rate rental units represent
new households in Carlsbad. These households represent new income in Carlsbad that will
consume goods and services, either through purchases of goods and services or by
"consuming" governmental services. New consumption translates to new jobs; a portion of the
jobs are at lower compensation levels, low compensation jobs translate to lower income
households that cannot afford these market-rate units in Carlsbad and therefore need
affordable housing.
Impact Methodology and Models Used
The analysis is performed using two models. The IMP LAN model is a commercially available
model developed in 1979 and refined over time to quantify the impacts of changes in a local
economy, including the employment impacts of changes in personal income. The IMPLAN
model is "inputted" with net new personal income in Carlsbad and moves through a series of
adjustments to disposable income, a distribution of expenditures, and ultimately produces a
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quantification of jobs generated by industry. The KMA jobs housing nexus model, which was
developed over 20 years ago to analyze the income structure of job growth, is used to
determine the household income of new employee households, identifying how many are at
lower-income and housing affordability levels.
Organization of this Document
• Following the Summary and Recommendations is the technical nexus analysis report
(Appendix I) and a detailed discussion of market-rate and affordable residential values
(Appendix II). The Summary and Recommendations is not intended as a stand-alone
document and should not be printed or distributed without the appendices explaining all
the analyses and underlying assumptions.
• Appendix I contains the full Residential Nexus Analysis report and all the tables that are a
part of the analysis.
• Appendix II -Residential Values -Market and Affordable is a background section that
establishes the market values of various types of attached residential units or "projects"
· based on surveys of new units renting in Carlsbad. This appendix also contains a discussion
of affordable rent levels at various affordability levels, per the current Area Median Income
(AMI), and contains a calculation of affordability gaps.
This report has been prepared using the best and most recent data available. Local data and
sources were used wherever possible. See Appendices I and II for more information.
Analysis Summary
The Prototypes
Four residential rental prototypes, presented in detail in Appendix II, were identified for
Carlsbad based on input from City staff. The four prototypes are summarized below:
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• A town home unit, built at an average density of 12 units to the acre. Includes a mix of two
and three bedrooms, averaging 1,250 square feet (SF), renting for $2,360.
• A garden apartment unit in a project with an average density of 20 units per acre. Includes
one, two, and three bedroom units averaging 860 SF. Market rent is estimated at $1,972
per month.
• A stacked flat apartment unit in a project with an average density of 30 units per acre.
Includes a mix of one and two bedroom units, averaging 820 SF, renting for $1,987 per
month.
• Mixed-use stacked flats over ground floor retail with an average density of 28 units per
acre. Includes one and two bedroom units averaging, 750 SF, and 3,000 SF of retail space
on the ground floor. Average market rent is estimated at $2,091 per month for the
residential component and $3.00 per SF per month triple-net (NNN) for the commercial
component.
Household Income
From the rent level of the four prototypes, the household income of the renter is readily
estimated using standard housing policy and lending standards established by local, State, and
Federal affordable housing programs. Renters are assumed to spend 30% of their household
income on total housing expenses.
Household income for each prototype unit is estimated in Exhibit 2.
Exhibit 2: Household Income
Garden Stacked Flat Mixed-Use
Townhome Apartments Apartments Rental
Gross Household Income $97,000 $81,000 $82,000 $86,000
As would be expected, the higher rent units translate to higher household income.
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This study references "Extremely low, "Very low," "Low," and "Lower" household incomes.
These terms and their descriptions are as defined in the lnclusionary Housing Ordinance,
Carlsbad Municipal Code §21.85.020.
Jobs Generated
The next step in the nexus analysis is to adjust gross household income to disposable income,
or income after State and Federal ta xes, Social Security and Medicare deductions, and personal
savings.
To simplify the presentation of results, the analysis is run for building modules of 100 housing
units. This avoids awkward fractions, especially at the detailed level by job industry. The
IMPLAN model output provides jobs by industry; the total numbers of jobs generated are
shown in Exhibit 3. The geographic area of job generation is San Diego County.
Exhibit 3: Jobs Generated per 100 Units
Garden Stacked Flat Mixed-Use
Townhome Apartments Apartments Rental
Gross Household Income $97,000 $81,000 $82,000 $86,000
Income Available for Household $66,000 $55,000 $55,000 $58,000 Expenditures
Total Jobs Generated, 100 units 50.3 42.5 42.5 44.9
The IMP LAN model quantifies jobs generated at establishments that serve new residents
directly (i.e. supermarkets, banks, or schools), jobs generated by increased demand at firms
which service or supply these establishments (wholesalers, janitorial contractors, accounting
firms, or any jobs down the service/supply chain from direct jobs), and jobs generated when
the new employees spend their wages in the local economy and generate additional jobs.
Compensation Levels of Jobs and Household Income
The output of the IMPLAN model -the numbers of jobs by industry -are then "input" into the
KMA jobs housing nexu s analysis model to quantify the compensation level of new jobs and the
income of the worker households. The KMA model sorts the jobs by industry into jobs by
occupation, based on national data, and then attaches wage distribution data to the
occupations, using recent San Diego County data from the California Employment Development
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Department (EDD). The KMA model also converts the number of employees to the number of
employee households, recognizing that there is, on average, more than one worker per
household, and thus the number of housing units in demand for new workers is reduced.
As shown in Exhibit 4, the output of the model is the number of new worker households by
income level expressed in relation to AMI attributable to the new market-rate rental units and
new households in Carlsbad.
Exhibit 4: New Worker Households by Income Level per 100 Marl<et-Rate Units
Garden Stacked Flat Mixed-Use
Household Income Category Townhome Apartments Apartments Rental
Very low Up to 50% AMI 9.2 7.8 7.8 8.2
Low Greater than 50% but 8.1 not exceeding 80% AMI 6.9 6.9 · 7.2
Total, Not exceeding 80% AMI 17.3 14.6 14.6 15.4
Greater than 80% AMI 11.0 9.3 9.3 9.9
Total, New Households 28.4 24.0 24.0 25.3
Affordable Units Required to Mitigate Impact of Market-Rate Rental Housing
Some developers may choose to mitigate the impact of their developments by providing
affordable rental housing rather than paying a fee. The analysis findings identify how many
lower income households are generated for every 100 market-rate rental units. As shown in
Exhibit 5, these findings are adjusted to percentages to show the percentages of affordable
rental housing needed to mitigate the impact of market-rate development. The percentages
are calculated including both market-rate and affordable rental units (for example, 25
affordable units per 100 market-rate rental units translates to 125 total rental units; 25
affordable units out of 125 units eqtJals 20%).
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Exhibit 5: Affordable Units Required to Mitigate Rental Housing Development
Garden Stacked Flat Mixed-Use
Household Income Category Townhome Apartments Apartments Rental
Very low Upto 50% AMI 8.4% 7.2% 7.2% 7.6%
Low Greater than 50% but 6.4% 5.6% 5.6% 5.8% not exceeding 80% AMI
Lower Not exceeding 80% AMI 14.8% 12.8% 12.8% 13.4%
The conclusion of the analysis is that a market-rate rental development would need to provide
12.8% to 14.8%1 of units affordable to lower-income households to mitigate the development's
impact.
Fee Levels Supported by the Nexus Analysis
The last step in the analysis puts a dollar amount on the cost of mitigating the affordable
housing impacts. The conclusions of the nexus analysis, expressed as the number of worker
households by income affordability category, are linked to the cost of delivering housing to the
households in need. The impact fee revenues could be used by the City to assist in producing
rental units to mitigate the impacts of new market-rate rental units.
KMA developed an affordable unit prototype designed to represent the type of rental unit
typically assisted by the City. Appendix II presents the survey materials, methodology, and
findings as well as affordable rent calculations. For the nexus ana lysis, KMA assumes that
households needing affordable housing will be housed in garden apartments. They are the
least expensive and represent the product type that the City is most likely to assist in the
future.
The cost of developing new residential units in Carlsbad was assembled from a number of
sources. Land costs were gathered from recent land sa les data collected by KMA. KMA is also
actively working on a number of multi-family projects in various locations in San Diego County
and has recent developer proforma financial analyses from which to draw cost information.
1 The range of impact shown in Exhibit 5 in terms of demand for affordable housing is less than the 15%
requirement in the City's lnclusionary Ordinance applicable to new market-rate ownership housing (and previously
applied to new market-rate rental housing as well).
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Each income or affordability tier is associated with a subsidy needed to produce and deliver a
unit at the specified affordability level. These subsidies are equal to affordability gaps, or the
difference between the cost of development and the unit value supported by the rent that can
be paid by a household at the specified income level.
When the affordability gap conclusions for each income tier are linked to the number of
affordable units required as a result of market-rate development (as indicated in Exhibit 4), the
result is a total nexus cost per new market-rate rental unit. Specifically, the maximum
supported fee level per market-rate unit is derived from the calculation shown in Exhibit 6.
Exhibit 6: Maximum Supported Fee Per Market-Rate Rental Unit Calculation
Affordability
gap per
affordable
unit
X
Affordable
units required
per market-
rate rental
unit
The results per unit are shown in Exhibit 7:
. -.
Exhibit 7: Maximum Supported Fee Level Per Market-Rate Rental Unit
Affordability Garden
Household Income Category Gap Townhome Apartments
Very low Up to 50% AM I $134,000 $12,300 $10,400
Greater than
Low 50% but not $137,800 $11,200 $9,400 exceeding 80%
AMI
Maximum Supported Fee $23,500 $19,800 Level
--
Maximum
supported fee
level per
market-rate
rental unit
Stacked Flat Mixed-Use
Apartments Rental
$10,400 $11,000
$9,400 $10,000
$19,800 $21,000
As shown in Exhibit 7, the residential nexus analysis supports maximum fee levels ranging from
$19,800 to $23,500 per market-rate rental unit, depending on the development prototype. The
per-unit maximum fees indicated in the table above result in a predictably higher fee per unit
associated with the bigger or more expensive rental housing unit and the higher income (and
expenditures) of the more affluent households.
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The total nexus costs indicated above may also be expressed on a per-square-foot level. The
square foot (SF) areas of the prot otype units used throughout the analysis become the basis for
the calculation. Again, see Appendix II for more discussion of the prototypes. Exhibit 8
presents t he results per square foot:
Exhibit 8: Total Nexus Costs Per Square Foot
Stacked
Affordability Garden Flat Mixed-Use
Household Income Category Gap Townhome Apartments Apartments Rental
Prototype Size (SF} l ,250SF 860SF 820SF 750SF
Up to 50% AMI $134,000 $10 $12 $13 $15
Greater than 50% but not $137,800 $9 $11 $12 $13 exceeding 80% AM I
Total Nexus Costs (ll $19 $23 $24 $28
(1) Allow for rounding error.
The calculated fee levels indicated above are maximum fees supported by the nexus analysis.
Establishing the appropriate fee level for the City is a policy matter that will be determined by
the City Council.
Potential Fee Levels for Consideration
When considering fee levels, there are several economic or real estate factors that may be
take n into account in determining potential fee l levels. A primary concern is t hat the fee levels
not be so onerous that they significa ntly constrain the development of new rental units.
As discussed, the nexus analysis establishes the maximum supportable fee level from a legal
nexus perspective. The KMA methodology employs a series of conservative assumptions
designed to ensure that the analysis does not overstat e the impact of residential housing
construction on the demand for new affordable housing. KMA recommen ds that cities select a
fee level that leaves a margin between the fee and the maximum established by t he nexus
analysis. This allows for minor changes t o the many input s, assumptions, and calculations
employed in the nexus analysis while assuring that the adopted fee remains below the
supported nexus amount.
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In order to provide the City with a framework for setting fee levels, KMA considered three
approaches: (1) the nexus supported fee amounts; (2) the funding level required for the City to
implement affordable housing development off-site; and (3) a comparison with the economic
impact of incorporating affordable housing development on-site. Each of these approaches is
briefly reviewed below.
Nexus Supported Fee Amounts -The nexus supported fee amounts represent the maximum
supportable fee from a lega l nexus perspective. As shown below, for the four development
prototypes, the maximum supported fee for market-rate rental housing is estimated to range
between $19,800and $23,SOOper unit, or $19 to $28 per SF. The average supported fee is
$21,025 per unit or $24 per SF. The City is likely to adopt a single impact fee applicable to all
market-rate rental housing development, regardless of product type. Therefore, as shown in
Exhibit 9, the appropriate maximum fee level supported by the residential nexus analysis is the
lowest of the four prototypes, or $19,800 per unit or $19 per SF.
Exhibit 9: Maximum Nexus Supported Fee Amounts
Prototype 1 Prototype 2 Prototype 3
Garden Stacked Flat
Townhomes Apartments Rentals
Per Unit $23,500 $19,800 $19,800
Per SF $19 $23 $24
Prototype 4
Mixed-Use
Rentals
$21,000
$28
Average
$21,025
$24
• Funding Level Required for City to Develop 15% Affordable Housing Off-Site -This approach
estimates the funds that the City would need to receive in order to develop affordable
rental housing in a separate off-site location from a market-rate rental development. As
noted previously, each low-income rental unit has an estimated financing gap of
$137,800. In other words, for the City to undertake development of the affordable housing
units, it would need to collect $137,800 per affordable rental unit required. This gap figure
equates to $20,670 per market-rate rental unit developed (15% times $137,800}. As shown
in Exhibit 10, depending on the market-rate rental development prototype, this required
funding level translates to a range from $17 to $28 per SF, or an average of $24 per SF. If
the City adopts fees below this level, it would not be able to keep pace with its goal of
developing 15% affordable units off-site.
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Exhibit 10: Funding Level Required for City to Develop 15% Affordable Housing
Off-Site
Prototype 1 Prototype 2 Prototype 3 Prototype 4
Garden Stacked Flat Mixed-Use
Townhomes Apartments Rentals Rentals
Per Unit $20,670 $20,670 $20,670 $20,670
Per SF $17 $24 $25 $28
Average
$18,510
$24
• Economic Impact of Incorporating 15% Affordable Housing On-Site -The economic impact
to market-rate rental developments resulting from incorporation of 15% affordable housing
on-site, should owners choose to do so in compliance with the Costa-Hawkins Act, can be
measured using each of the financial proformas for the four prototypes evaluated in this
study. As shown in Exhibit 11, KMA estimates this economic impact to range between
$17,100 and $27,500 per unit, or $20 to $34 per SF. The average economic impact is
$22,850 per unit or $26 per SF. Notably, the economic impact figures vary more widely
than the funding level requirements shown in Exhibit 10. The figures in Exhibit 11 assume
that developers are building comparable product for both the market-rate and affordable
rental units. The figures in Exhibit 10 assume that the City is building affordable rental units
in a garden apartment configuration.
Exhibit 11: Economic Impact of Incorporating 15% Affordable Housing On-Site
Prototype 1 Prototype 2 Prototype 3 Prototype 4
Garden Stacked Flat Mixed-Use
Townhomes Apartments Rentals Rentals
Per Unit $27,500 $17,100 $21,000 $25,800
Per SF $22 $20 $26 $34
Average
$22,850
$26
In view of the above approaches, KMA recommends that the City consider an impact fee that
does not exceed $20,000 per unit or $20 per SF.
Exhibit 12 below provides a graphical illustration of the nexus analysis using the Garden
Apartments prototype.
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EXHIBIT 12
Overview of Nexus Analysis
Figures in Chart Apply to the Garden Apartments Protoype
Starting Point:
100 New Market
Rate Units
Market Rent: $1,972
100 New
Households
Avg. Income $81,000/Year
($8.1 M for 100 HHs)
New Demand for
Goods and Services
($5.5 M new spending
after deductions for
taxes, etc.)
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Adjust from number of
workers to Households at
1.77 Workers per
Household
42.5 jobs/ 1. 77 =
24.0 Households
Distinguish Housing
Need by Affordability
Tier
15 units needed through
80%AMI
(based on compensation
levels for new
service jobs)
Multiply by Net Cost
to Produce
Affordable Units
(Affordability Gap)
Nexus Findin :
Maximum Fee Levels
$19,800 per unit
$23 per SF
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Potential Indices for Fee Level Adjustment
There are a number of potential indices that could be used to adjust fee levels in the future.
Some objectives that could potentially be taken into consideration in selecting an appropriate
index for the fee are as follows:
Administrative Objectives
• Simple and easily administered
• Clear and objective, not subject to interpretation
• Tied to readily accessible and neutral third party published source
Potential Policy Objectives
• Maintain ability to mitigate impacts/fund affordable housing over long-term
• Maintain consistent fee burden over long-term
• Respond to economic cycles: fee relief during economic downturn, increased fees with a
strong economy
Exhibit 13 reviews a range of potential indices that could be used to adjust the fee in the future.
Exhibit 13: Potential Indices for Fee Level Adjustment
Index Concept / Description
#1 Fees go up or down based on
building construction costs.
Building Cost
Index (BCI) Published by Engineering News
Record (ENR).
Available at national average and
for 20 cities (not Carlsbad or San
Diego; Los Angeles is nearest city
available).
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Advantages
Very well established.
Consistent fee burden
over time relative to
construction costs.
Disadvantages
May not trend with
changes in non-
construction
development costs
(land, other soft
costs).
May not trend with
cost to produce
affordable units.
Only addresses cost
side of the equation.
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Exhibit 13: Potential Indices for Fee Level Adjustment
Index Concept / Description Advantages Disadvantages
#2 Also published by ENR and Same as above. Same as above.
similar to Building Cost Indices
Construction but with different weighting of
Costs Index labor and material cost
(CCI) categories.
#3 Published by the U.S. Burea u of Very well established. May not trend with:
Labor St atistics. Available for
Consumer major metro areas including San Generally tracks with -Co nstru ction costs
Price Index Diego. inflation. (consistent fee
(CPI) Produced by neutral burden)
governmental agency. or
-Cost to produce
affordable units
(consistent ability
to mitigate
impacts)
#4 BLS publishes "producer price Opportunity for index Different indices for
indices" for a long list of tied to specific types of different uses
Bureau of industries. construction. somewhat more
Labor Statistics complicated
(BLS) Produced by neutral
Construction governmental agency. Only addresses cost
Indices side of the equation
#5 Metric tied to housing Maintains consistent Would not maintain
affordability. level of mitigation. co nsistent fee burden.
Housing
Affordability Fees go up as housing becomes Revenue increase as Requires special
Index less affordable. cost to produce unit calculation by the City
increases. of Carlsbad and not
Based on what median produced by a neutral
household can afford versus third party.
median housing cost
For purposes of simplicity, the City may want to consider an annual adjuster based on one of
the readily ava ilable, third party indices listed above. However, the affordability gaps are a very
large determinant of the overall nexu s amounts. Indices such as #1 through #4 above only
address the cost side of the affordability gap equation. Measures of affordability ga p, on the
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other hand, typically require formulas using a variety of inputs and assumption that have to be
determined each year.
KMA recommends that the City adopt a fee program which enables the City Manager to make
the determination whether to implement the annual adjustment each year, up to the amount
supported by the index that is ultimately selected by the City.
Regardless of the index used by the City, it is important that the indexed fee should remain
under the ceilings established by the nexus analysis. It is difficult to predict exactly how the
maximum fees supported will be affected by changes in the economy and the housing market.
KMA also recommends that the City conduct a re-evaluation of the fee every five to eight years.
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APPENDIX I: RESIDENTIAL NEXUS ANALYSIS
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INTRODUCTION AND OVERVIEW
Keyser Marston Associates (KMA) has prepared this residential nexus analysis for the City of
Carlsbad (City) per a contractual agreement. This residential nexus analysis addresses market-
rate residential rental projects and the various types of rental units that could be subject to the
lnclusionary Housing Ordinance, and quantifies the linkages between new market-rate units
and the demand for affordable housing generated by the residents of new units.
The Carlsbad Context and Purpose of Report
The purpose of Appendix I is to provide an overview of the analysis and a discussion of the
findings of a residential nexus analysis conducted for the City of Carlsbad (City). The residential
nexus analysis quantifies the linkages between new market-rate rental units and the demand
for affordable housing. The conclusion of the nexus analysis reflects the maximum mitigation
impact fee supported to offset affordable housing demand caused by the development of
market-rate rental housing.
Court rulings in 2009 questioned whether a city can impose an inclusionary ordinance on a
market-rate rental development (Palmer/Sixth Street Properties v. City of Los Angeles [Palmer]),
and the legitimacy of affordable housing in-lieu fees (Building Industry Association of Central
California vs. City of Patterson [Patterson]).
Under Palmer, the California Court of Appeals ruled in July 2009 that local inclusionary housing
requirements when applied to rental housing violate State laws governing rent controls. As a
result, many cities have restructured their inclusionary housing rental programs into mitigation
(or impact) fee based programs. The residential nexus analysis takes into consideration the
Palmer decision and demonstrates the impact fee levels supported from a nexus perspective.
The Patterson case invalidated in-lieu affordable housing fees if "no reasonable relationship" is
found between the construction of market-rate housing and the need for affordable housing.
As such, instead of establishing fees based on a city's citywide need for affordable housing,
affordable housing impact fees must be rationally related to the impact caused by market-rate
housing. The purpose of the nexus study is to analyze the nexus between new market-rate
rental development and to calculate a nexus-based housing impact fee.
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The City of Carlsbad's existing lnclusionary Housing Ordinance requires all new ownership
residential projects to set aside at least 15% of units so as to be restricted in terms of
occupancy and affordability to lower income households. Lower-income households includes
Low-income, Very low-income, and Extremely low-income households, whose gross income
does not exceed 80% of median income for San Diego County as determined annually by the
U.S. Department of Housing and Urban Development (City of Carlsbad Municipal Code
§21.85.020). In accordance with the Palmer ruling, the City of Carlsbad amended its
lnclusionary Housing Ordinance in 2010. As a result, the City no longer applies its lnclusionary
Housing Ordinance to rental developments unless the developer has received direct financial
assistance or other development incentives or concessions from the City and the developer
agrees by contract to limit rents for below market-rate rental units. Developers may also
voluntarily agree to provide inclusionary rental units. Subdivisions with fewer than seven units
are allowed the payment of an in-lieu fee to fulfill their inclusionary housing obligations. The
fee is based on the difference in cost to produce a market-rate rental unit versus a lower-
income affordable unit. As of September 1, 2015, the in-lieu fee per market-rate for-sale unit
was $4,515. This fee was established in 1996 and has not been updated since. This fee is
currently paid by developments of six (6) units or less, which also have an inclusionary
requirement per the City's lnclusionary Ordinance. This fee is not proposed for change at this
time. A new fee is being considered for application to market-rate rental developments of any
size, which are not subject to the City's lnclusionary Ordinance but create a need for affordable
housing for low income households.
The Nexus Concept
The underlying nexus concept is that the newly constructed residential units represent new
households in Carlsbad. These households represent new income in Carlsbad that will consume
goods and services, either through purchases of goods and services or "consumption" of
governmental services. New consumption translates to jobs; a portion of the jobs are at lower
compensation levels; low compensation jobs generate new lower-income households that
cannot afford market-rate units in Carlsbad and therefore need affordable housing.
Use of This Study
An impact analysis of this nature has been prepared for the limited purpose of determining
nexus support for consideration of a rental housing impact fee. It has not been prepared as a
document to guide policy design in the broader context.
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Methodology and Models Used
The methodology or analysis procedure for this nexus analysis starts with the rental rate of a
new market-rate residential unit, and moves through a series of linkages to the gross income of
the household that rented the unit, the disposable income of the new household, the annual
expenditures on goods and services, the jobs associated with the purchases and delivery of
services, the income of the workers doing those jobs, the household income of the workers
and, ultimately, the affordability level of the housing needed by the worker households. The
steps of the analysis from household income to jobs generated were performed using the
IMPLAN model, a model widely used for over 30 years to quantify the impacts of changes in a
local economy, including employment impacts from changes in personal income. From job
generation by industry, KMA used its own jobs housing nexus model to quantify the income of
worker households by affordability level.
To illustrate the linkages by looking at a simplified example, we can take an average household
that rents a unit at a certain rent. From that rent, we estimate the gross income of the
household and the disposable income of the household. The disposable income, on average,
will be used to "purchase" or consume a range of goods and services, such as purchases at the
supermarket or services at the bank. Purchases in the local economy in turn generate
employment. The jobs generated are at different compensation levels. Some of the jobs are
low paying and as a result, even when there is more than one worker in the household, there
are some lower-and middle-income households who cannot afford market-rate housing in
Carlsbad.
The IMPLAN model quantifies jobs generated at establishments that serve new residents
directly (e.g., supermarkets, banks, or schools), jobs generated by increased demand at firms
which service or supply these establishments, and jobs generated when the new employees
spend their wages in the local economy and generate additional jobs. The IMPLAN model
estimates the total impact combined.
Net New Underlying Assumption
An underlying assumption of the analysis is that households that rent new units represent net
new households in Carlsbad. If renters have relocated from elsewhere in the City, vacancies
have been created that will be filled. An adjustment to new construction of units would be
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warranted if Carlsbad were experiencing a significant level of demolitions or loss of existing
housing inventory. However, the rate of housing unit removal is so low as to not warrant an
adjustment or offset.
Since the analysis addresses net new households in Carlsbad and the impacts generated by
their consumption expenditures, it quantifies net new demands for affordable units to
accommodate new worker households. As such, the impact results do not address nor in any
way include existing deficiencies in the supply of affordable housing.
Geographic Area of Impact
The analysis quantifies impacts occurring within San Diego County. The IMPLAN model
computes the jobs generated within the County and sorts out those that occur beyond the
County boundaries. The results therefore slightly underestimate the total impact of new
housing on the total need for affordable housing.
Job impacts, like most types of impacts, occur irrespective of political boundaries. And like
other types of impact analyses, such as traffic, impacts beyond city boundaries are experienced,
are relevant, and are important. See Addendum for further discussion.
Disclaimer
This report has been prepared using the best and most recent data available at the time of the
analysis. Local data and sources were used wherever possible. Major sources include the U.S.
Census Bureau: 2011-2013 American Community Survey, California Employment Development
Department, and the IMPLAN model, which we believe are sufficiently accurate for the
purposes of the analysis.
A. MARKET-RATE UNITS AND GROSS HOUSEHOLD INCOME
This section describes the prototypical market-rate rental units and the income of the renter
households assumed in KMA nexus analysis. Household income is the input to the IMPLAN
model described in Section B of this report. These are the starting points of the chain of
linkages that connect new market-rate rental units to incremental demand for affordable
residential units.
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This section provides a summary of the prototypes and household income. More description
and supporting tables are provided in Appendix II.
Recent Housing Market Activity and Prototypical Units
In identifying residential prototypes, KMA undertook a survey of residential rental units
currently being marketed throughout the City. KMA accessed readily available data on
apartment rents. Four rental prototypes were identified, representing projects currently being
proposed, developed, or that have the potential for development in the foreseeable future.
Like much of San Diego County, Carlsbad is experiencing a resurgence in development interest
in rental apartments. As of this writing in 2016, economic and investment conditions for
apartment development are the healthiest they have been in years. Rents continue to move in
an upward direction, while vacancies remain fairly stable. In short, there is robust demand
within the rental market, with significant new construction underway or anticipated in many
submarkets within the coming years.
For the purposes of the nexus analysis, the prototypes are as follows:
• A townhome unit in a project with an average density of 12 units to the acre. Unit sizes
averages 1,250 SF, a mix of two and three bedroom units, renting for $2,360 per month.
• A garden apartment unit in a project with an average density of 20 units per acre. Unit size
averages 860 SF, a mix of one, two and three bedroom units, renting for $1,972 per
month.
• A stacked flat apartment unit in a project with an average density of 30 units per acre.
Includes a mix of one and two bedroom units, averaging 820 SF, renting for $1,987 per
month.
• Mixed-use stacked flats over ground floor retail with an average density of 28 units per
acre. Includes one and two bedroom units averaging 750 SF and 3,000 SF of retail space on
the ground floor. Average market rent is estimated at $2,091 per month for the residential
component and $3.00 per SF per month triple-net (NNN) for the commercial component.
Reference is made to the market survey material in Appendix II.
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Summary
Exhibit 14 presents the prototypes tested in the nexus analysis:
Exhibit 14: Summary of Prototypes
Garden Stacked Flat Mixed-Use
Townhome Apartments Apartments Rental
Average Unit Size 1,250 SF 860 SF 820 SF 750 SF
Average No. of Bedrooms 2.5 1.8 1.6 1.5
Average Rent $2,360 $1,972 $1,987 $2,091
Commercia l Rent/SF $3.00 ------------
Income of Housing Unit Renter
The next step in the analysis is to determine the income of the renting households in the
prototypical units. The gross household income of the renters is the input to the IMPLAN
model.
The standard used by lending institutions and Federal, State, and local affordable housing
programs for relating annual rent to household income is 30%. While leasing agents and
landlords may permit rental payments to represent a slightly higher share of total income, 30%
represents an average. This is based on the fact that renters are also likely to have other debt,
and that many do not choose to spend more than 30% of their income on rent, since, unlike an
ownership situation, the unit is not viewed as an investment with value enhancement potential.
The resulting relationship is that annual household income is 3.3 times annual rent.
The estimated gross household incomes of renters of the prototype units are calculated in
Appendix I -Tables A-1 through A-4, and summarized in Exhibit 15.
Exhibit 15: Household Income
Gross Household Income
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Garden
Townhome Apartments
$97,000 $81,000
Stacked Flat
Apartments
$82,000
Mixed-Use
Rental
$86,000
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Gross household income is then converted to disposa ble income by accounting for State and
Federal income taxes, Social Security and Medicare (FICA) taxes, and personal savings. The
percent of income available for expenditures is estimated at 71% as ca lcu lated in Appendix I -
Table A-5.
The nexus ana lysis is conducted on 100-unit building modules for ease of presentation, and to
avoid fractions. Appendix I -Table A-6 and Exhibit 16 summarize the conclusions of this section
and calculate the total household expenditures available for the 100-unit building modules.
This is the input into the IMPLAN model.
Exhibit 16: Income Available for Expenditures
Income Available for
Household Expenditures
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Townhome
$66,000
Garden
Apartments
$55,000
Stacked Flat
Apartments
$55,000
Mixed-Use
Rental
$58,000
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TABLEA-1
ANNUAL HOUSEHOLD INCOME, PROTOTYPE 1 -TOWNHOMES
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Market Rent
Monthly $1.89 /SF 1,250 SF 1
Utilities 2
Monthly Housing Cost
II. Annual Housing Cost
Ill. % of Income Spent on Rent
IV. Annual Household Income Required
V. Annual Rent to Income Ratio
Prototype 1
Townhomes
$2,360
.$.§2
$2,429
$29,148
30% 3
$97,000
3.3
(1) Based on results of the market survey. Represents rent levels applicable to new units.
(2) Monthly utility estimate includes landlord reimbursements and direct-billed utilities.
APPENDIX I
(3) While landlords may permit rental payments to represent a slightly higher share of total income, 30% represents an average.
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TABLE A-2
ANNUAL HOUSEHOLD INCOME, PROTOTYPE 2 -GARDEN APARTMENTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Prototype 2
Garden Apartments
I. Market Rent
Monthly
Utilities 2
Monthly Housing Cost
II. Annual Housing Cost
Ill. % of Income Spent on Rent
$2.29 /SF 860 SF 1 $1,972
ill
$2,031
$24,372
30% 3
IV. Annual Household Income Required $81,000
V. Annual Rent to Income Ratio
(1) Based on results of the market survey. Represents rent levels applicable to new units.
(2) Monthly utility estimate includes landlord reimbursements and direct-billed utilities.
3.3
APPENDIX I
(3) While landlords may permit rental payments to represent a slightly higher share of total income, 30% represents an average.
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TABLEA-3
ANNUAL HOUSEHOLD INCOME, PROTOTYPE 3 -STACKED FLATS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Market Rent
Monthly $2.42 /SF 820 SF 1
Utilities 2
Monthly Housing Cost
II. Annual Housing Cost
Ill. % of Income Spent on Rent
IV. Annual Household Income Required
V. Sales Rent to Income Ratio
Prototype 3
Stacked Flats
$1,987
.$.2.§
$2,043
$24,516
30% 3
$82,000
3.3
(1) Based on results of the market survey. Represents rent levels applicable to new units.
(2) Monthly utility estimate includes landlord reimbursements and direct-billed utilities.
APPENDIX I
(3) While landlords may permit rental payments to represent a slightly higher share of total income, 30% represents an average.
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TABLE A-4
ANNUAL HOUSEHOLD INCOME, PROTOTYPE 4 -MIXED-USE RENTAL
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Market Rent
Monthly $2.79 /SF
Utilities 2
Monthly Housing Cost
II. Annual Housing Cost
Ill. % of Income Spent on Rent
IV. Annual Household Income Required
V. Annual Rent to Income Ratio
750 SF 1
Prototype 4
Mixed-Use Rental
$2,091
ill
$2,146
$25,752
30% 3
$86,000
3.3
(1) Based on results of the market survey. Represents rent levels applicable to new units.
(2) Monthly utility estimate includes landlord reimbursements and direct-billed utilities.
APPENDIX I
(3) While landlords may permit rental payments to represent a slightly higher share of total income, 30% represents an average.
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APPENDIX I
TABLEA-5
INCOME AVAILABLE FOR EXPENDITURES'
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Prototype 1
Town homes
Gross Household Income $97,000
Gross Income 100%
Less:
Federal Income Taxes 2 10.6%
State Income Taxes 3 3%
FICA Tax Rate 4 7.65%
Savings & other deductions 5 8%
Percent of Income Available 71%
for Expenditures 6
{Input to IMPLAN model]
Prototype 2 Prototype 3 Prototype 4
Garden Stacked Mixed-Use
Apartments Flats Rental
$81,000 $82,000 $86,000
100% 100% 100%
10.6% 11% 10.6%
3% 3% 3%
7.65% 7.65% 7.65%
8% 8% 8%
71% 71% 71%
1 Gross income after deduction of taxes and savings. Income available for expenditures is the input to the IMPLAN model which is used to
estimate the resulting employment impacts. Housing costs are not deducted as part of this adjustment step because they are addressed
separately as expenditures within the IMPLAN model.
2 Reflects average tax rates (as opposed to marginal) based on U.S. Internal Revenue Services, Tax Statistics, Tables 1.1 and 2.1. Renter
households are assumed to take the standard deduction. For the four prototypes, the average rate for AGI of $7S,000 to $100,000 for tax
payers not itemizing deductions is applied at 10.6%.
3 Average tax rate estimated by KMA based on marginal rates per the California Franchise Tax Board and ratios of taxable income to gross
income estimat!;!d based on U.S. Internal Revenue Service data. Average tax rates are based upon an average of single and married tax
schedules weighted based upon the percentage of married households living in San Francisco per the 2009-2013 ACS.
4 For Social Security and Medicare. Conservatively assumes all income will be subject to Social Security taxes. The current ceiling on
applicability of Social Security taxes is $117,000 (ceiling applies per earner not per household).
5 Household savings including retirement accounts like 401k / IRA and other deductions such as interest costs on credit cards, auto loans,
etc, necessary to determine the amount of income available for expenditures. The 8% rate used in the analysis for households earning less
than $225,000 is based on the average over the past 20 years computed from U.S. Bureau of Economic Analysis data, specifically the
National Income and Product Accounts, Table 2.1 "Personal Income and Its Disposition." Households earning more than $225,000 are
assumed to save a higher percentage of their income, based on data published by the National Bureau of Economic Research, "Wealth
Inequality in the United States Since 1913: Evidence From Capitalized Income Tax Data," October 2014.
6 Deductions from gross income to arrive at the income available for expenditures are consistent with the way the IMPLAN model and
National Income and Product Accounts (NIPA) defines income available for personal consumption expenditures. Income taxes,
contributions to Social Security and Medicare, and savings are deducted; however, property taxes and sales taxes are not. Housing costs
are not deducted as part of the adjustment because they are addressed separately as expenditures within the IMPLAN model.
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APPENDIX I
TABLE A-6
NEW MARKET-RATE RESIDENTIAL HOUSEHOLD SUMMARY
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
100 Unit
Per Unit Per SF Building Module
I. Prototype 1: Townhomes
Units 100Units
Building SF (gross) 1,250 125,000
Rent
Monthly $2,360 $1.89 /SF $236,000
Monthly with Utilities $2,429 $243,000
Annual with Utilities $29,148 $2,915,000
Rent to Income Ratio 3.3 3.3
Gross Household Income $97,000 $9,700,000
Income Available for Expenditure 1 71% of gross $69,000 $6,890,000
Expenditures adjusted for vacancy 2 5% vacancy $66,000 $6,500,000
II. Prototype 2: Garden Apartments
Units 100Units
Building SF (gross) 860 86,000
Rent
Monthly $1,972 $2.29 /SF $197,000
Monthly with Utilities $2,031 $203,000
Annual with Utilities $24,372 $2,437,000
Rent to Income Ratio 3.3 3.3
Gross Household Income $81,000 $8,100,000
Income Available for Expenditure1 71% of gross $58,000 $5,750,000
Expenditures adjusted for vacancv2 5% vacancy $55,000 $5,500,000
(1) Represents net income available for expenditures after income tax, payroll taxes, and savings. See Table A-5 for derivation.
(2) Allowance to account for standard operational vacancy.
Source: Tables A-1 through A-5.
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TABLE A-6
NEW MARKET-RATE RESIDENTIAL HOUSEHOLD SUMMARY
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Ill. Prototype 3: Stacked Flats
Units
Building SF (gross)
Rent
Monthly
Monthly with Utilities
Annual with Utilities
Rent to Income Ratio
Gross Household Income
Income Available for Expenditure1 71% of gross
Expenditures adjusted for vacancl 5% vacancy
IV. Prototype 4: Mixed-Use Rental
Units
Building SF (gross)
Rent
Monthly
Monthly with Utilities
Annual with Utilities
Rent to Income Ratio
Gross Household Income
Income Available for Expenditure1 71% of gross
Expenditures adjusted for vacancy 2 5% vacancy
APPENDIX I
100 Unit
Per Unit Per SF Building Module
100Units
820 82,000
$1,987 $2.42 /SF $199,000
$2,043 $204,000
$24,516 $2,452,000
3.3 3.3
$82,000 $8,200,000
$58,000 $5,820,000
$55,000 $5,500,000
100 Units
750 75,000
$2,091 $2.79 /SF $209,000
$2,146 $215,000
$25,752 $2,575,000
3.3 3.3
$86,000 $8,600,000
$61,000 $6,110,000
$58,000 $5,800,000
(1) Represents net income available for expenditures after income tax, payroll taxes, and savings. See Table A-5 for derivation.
(2) Allowance to account for standard operational vacancy.
Source: Tables A-1 through A-5.
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B. THE IMPLAN MODEL
Consumer spending by residents of new housing units will create jobs, particularly in sectors such
as restaurants, health care, and retail, which are closely connected to the expenditures of
residents. The widely used economic analysis tool, IMPLAN (IMpact Analysis for PLANning), was
used to quantify these new jobs by industry sector.
IMPLAN Model Description
The IMPLAN model is an economic analysis software package now commercially available through
the Minnesota IMPLAN Group. IMPLAN was originally developed by the U.S. Forest Service, the
Federal Emergency Management Agency, and the U.S. Department of the Interior Bureau of Land
Management and has been in use since 1979 and refined over time. It has become a widely used
tool for analyzing economic impacts from a broad range of applications from major construction
projects to natural resource programs.
IMPLAN is based on an input-output accounting of commodity flows within an economy from
producers to intermediate and final consumers. The model establishes a matrix of supply chain
relationships between industries and also between households and the producers of household
goods and services. Assumptions about the portion of inputs or supplies for a given industry likely
to be met by local suppliers, and the portion supplied from outside the region or study area, are
derived internally within the model using data on the industrial structure of the region.
The output or result of the model is generated by tracking changes in purchases for final use (final
demand) as they filter through the supply chain. Industries that produce goods and services for
final demand or consumption must purchase inputs from other producers, which in turn, purchase
goods and services. The model tracks these relationships through the economy to the point
where leakages from the region stop the cycle. This allows the user to identify how a change in
demand for one industry will affect a list of over 400 other industry sectors. The projected
response of an economy to a change in final demand can be viewed in terms of economic output,
employment, or income.
Data sets are available for each county and state, so the model can be tailored to the specific
economic conditions of the region being analyzed. This analysis utilizes the data set for San Diego
County. As will be discussed, much of the employment impact is in local-serving sectors,
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such as retail, eating and drinking establishments, and medical services. The employment impacts
will extend throughout the County and beyond based on where jobs are located that serve
Carlsbad residents.
Application of the IMPLAN Model to Estimate Job Growth
The IMPLAN model was applied to link gross household income to household expenditures to job
growth occurring in San Diego County. Employment generated by the household income of
residents is analyzed in modules of 100 residential units to facilitate communication of the results
and avoid fractions. The model distributes spending among various types of goods and services
(industry sectors) based on data from the Consumer Expenditure Survey and the Bureau of
Economic Analysis Benchmark input-output study, to estimate employment generated.
Job creation, driven by increased demand for products and services, was projected for each of the
industries that will serve the new households. The employment generated by this new household
spending is summarized in Exhibit 17.
Exhibit 17: Jobs Generated per 100 Units
Garden Stacked Flat Mixed-Use
Townhome Apartments Apartments Rental
Gross Household Income $97,000 $81,000 $82,000 $86,000
Income Available for Household $66,000 $55,000 $55,000 $58,000
Expenditures
Total Jobs Generat ed, 100 units 50.3 42.5 42.5 44.9
Appendix I -Table B-1 provides a detailed summary of employment generated by industry. The
table shows industries sorted by projected employment. Expenditure patterns vary by income
level, and the IMPLAN resu lts are calculated according to the income bracket. In the case of the
Carlsbad prototypes, garden apartment and stacked flat households are in one income category,
and townhome and mixed-use rental households are in a second. Estimated employment is
shown for each IMP LAN industry sector representing 1% or more of total employment. The jobs
that are generated within the County are heavily in the retail industries, in restaurants and other
eating establishments, and in industries that provide local services such as hea lth care and real
estate.
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The jobs counted in the IMPLAN model cover all jobs, full and part time, similar to the U.S. Census
and all reporting agencies (unless otherwise indicated).
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TABLE B-1
EMPLOYMENT GENERATED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Per 100 Market-Rate Units
Prototype 2: Prototype 3: Prototype 4:
Prototype 1: Garden Stacked Mixed-Use
Town homes Apartments Flats Rental
Household Expenditures (100 Market-Rate Units) 1 $6,500,000 $5,500,000 $5,500,000 $5,800,000
Jobs Generated by Industry 2
Offices of physicians 0.0 1.5 1.5 1.6
Offices of dentists 0.7 0.6 0.6 0.6
Offices of other health practitioners 0.8 0.7 0.7 0.7
Home health care services 0.6 0.5 0.5 0.5
Hospitals 1.6 1.4 1.4 1.5
Nursing and community care facilities 1.3 1.1 1.1 1.2
Subtotal Healthcare 5.1 5.8 5.8 6.1
Retail -Motor vehicle and parts dealers 0.6 0.5 0.5 0.5
Retail -Building material and garden equipment and supplies store! 0.6 0.5 0.5 0.5
Retail -Food and beverage stores 1.5 1.3 1.3 1.3
Retail -General merchandise stores 1.3 1.1 1.1 1.2
Retail -Miscellaneious store retailers 0.6 0.5 0.5 0.6
Retail -Nonstore retailers 0.6 0.5 0.5 0.5
Subtotal Retail 5.2 4.4 4.4 4.6
Full-service restaurants 3.0 2.5 2.5 2.6
Limited-service restaurants 2.8 2.4 2.4 2.5
All other food and drinking places 1.5 1.3 1.3 1.4
Subtotal Food Services 7.3 6.2 6.2 6.5
Wholesale trade 1.4 1.2 1.2 1.2
Other financial investment activities 1.2 1.0 1.0 1.1
Insurance agencies, brokerages, and related activities 0.6 0.5 0.5 0.6
Real estate 2.3 1.9 1.9 2.0
Legal services 0.5 0.4 0.4 0.5
Employment services 0.7 0.6 0.6 0.6
Services to buildings 0.9 0.7 0.7 0.8
Junior colleges, colleges, universities, and professional schools 0.6 0.5 0.5 0.6
Other educational services 0.6 0.5 0.5 0.5
Individual and family services 1.7 1.4 1.4 1.5
Automotive repair and maintenance, except car washes 0.9 0.7 0.7 0.8
Personal care services 1.1 1.0 1.0 1.0
Other personal services 0.8 0.7 0.7 0.8
Private households 0.8 0.7 0.7 0.7
All Other 18.6 14.2 14.2 15.0
Total Number of Jobs Generated 50.3 42.5 42.5 44.9
1 Estimated employment generated by expenditures of households within 100 prototypical market-rate units. Employment estimates
are based on the IMPLAN Group's economic model, IMPLAN, for San Diego County. Includes both full-and part-time jobs.
2 For Industries representing more than 1% of total employment.
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APPENDIX I
%of
Jobs
4%
1%
2%
1%
3%
3%
14%
1%
1%
3%
3%
1%
1%
10%
6%
6%
3%
15%
3%
2%
1%
5%
1%
1%
2%
1%
1%
3%
2%
2%
2%
2%
33%
100%
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C. THE KMA JOBS HOUSING NEXUS MODEL
This section presents a summary of the analysis linking the employment growth associated with
residential development, or the output of the IMPLAN model (see Section B), to the estimated
number of lower-income housing units required in two income categories, for each of the four
residential prototype units.
Analysis Approach and Framework
The analysis approach is to exa mine the employment growth for industries related to consu mer
spending by residents in the 100-unit modules. Then, through a series of linkage steps, the
number of employees is converted to households and housing units by affordability level. The
findings are expressed in terms of numbers of affordable households per 100 market-rate units.
The analysis addresses the affordable unit demand associated with new market-rate rental
housing units in Carlsbad. Exhibit 18 shows the 2015 San Diego County Area Median Income (AMI)
limits for the two categories that were evaluated --50% AMI and 80% AMI --as well as the County
median for comparison purposes.
Exhibit 18: 2015 Income Limits for San Diego County 111
Household Size (Persons)
Household Income Category 1 2 3 4 5 6
Very low (2)
Upto 50% $28,350 $32,400 $36,450 $40,500 $43,750 $47,000
AMI
Greater than
Low (2)
50% but not $45,400 $51,850 $58,350 $64,800 $70,000 $75,200 exceeding
80%AMI
Median (3) 100%AMI $53,150 $60,700 $68,300 $75,900 $81,950 $88,050
(1) The 2016 San Diego County Area Median Income limits were not yet released when KMA completed its analysis.
{2) Source: U.S. Department of Housing and Urban Development {HUD). Limits adjusted for high housing cost area.
(3) Source: State of California Department of Housing and Community Development.
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The analysis is conducted using a model that KMA developed and has applied to similar
evaluations in many other jurisdictions. The model inputs are all local data to the extent possible,
and are fully documented in the following description.
Analysis Steps
Appendix I -Tables C-1 through C-3 at the end of this section present a summary of the nexus
analysis steps for the prototype units. Following is a description of each step of the analysis.
Step 1-Estimate of Total New Employees
Appendix I -Table C-1 commences with the total number of employees associated with the new
market-rate units. The employees were estimated based on household expenditures of new
residents using the IMPLAN model (see Section B).
Step 2 -Adjustment from Employees to Employee Households
This step (Appendix I -Table C-1) converts the number of employees to the number of employee
households, recognizing that there is, on average, more than one worker per household, and thus
the number of housing units in demand for new workers is reduc~d. The workers-per-worker-
household ratio eliminates from the equation all, non-working households, such as retired persons,
students, and those on public assistance. The County average of 1.77 workers per worker
household (from the U.S. Census Bureau: 2011-2013 American Community Survey) is used for this
step in the analysis. The number of jobs is divided by 1.77 to determine the number of worker
households. (Average workers related to all households is a lower ratio because all households
are counted in the denominator, not just worker households; using average workers per total
households would produce greater demand for housing units.) The 1.77 ratio covers all workers,
full and part time.
Step 3 -Occupational Distribution of Employees
The occupational breakdown of employees is the first step to arrive at income level. The output
from the IMPLAN model provides the number of employees by industry sector. The IMPLAN
output is paired with data from the Department of Labor, Bureau of Labor Statistics, May 2014,
Occupational Employment Survey (OES) to estimate the occupational composition of employees
for each industry sector. Industry refers to the economic activity in which workers are primarily
engaged, such as retail or manufacturing; occupation describes the jobs of the workers in the
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industry, such as sales clerks or managers in retail stores and machine operators and managers in
manufacturing (each industry has its own distinct cross section of occupations or occupational
mix).
Pairing of OES and IMPLAN data was accomplished by matching IMPLAN industry sector codes
with the four-digit North American Industry Classification System Code (NAICS) used in the OES.
Each IMPLAN industry sector is associated with one or more NAICS codes, with matching NAICS
codes ranging from two to five digits. Employment for IMPLAN sectors with multiple matching
NAICS codes was distributed among the matching codes based on the distribution of employment
among those industries at the national level. Employment for IMPLAN sectors where matching
NAICS codes were only at the two-or three-digit level of detail was distributed using a similar
approach, among all of the corresponding four-digit NAICS codes falling under the broader two-or
three-digit categories.
National-level employment totalsfor each industry within the OES were pro-rated to match the
employment distribution projected using the IMPLAN model, which varies by income category.
Occupational composition within each industry was held constant. The result is the estimated
occupational mix of employees.
As shown on Appendix I -Table C-1, new jobs will be distributed across a variety of occupational
categories. The three largest occupational categories are office and administrative support
positions (17%), food preparation and serving jobs {15%), and sales positions (13%). Step 3 of
Table C-1 indicates both the percentage of total employee households and the number of net new
employee households by occupation associated with 100 new market-rate units.
Step 4 -Estimates of Employee Households Meeting the Very Low and Lower Income
Definitions
As shown on Step 4 of Appendix I -Table C-2, occupation is translated to income based on recent
San Diego County wage and salary information from the California Employment Development
Department. This step in the analysis calculates the number of employee households that fall into
each income category for each household size.
Individual employee income data was used to calculate the number of households that fall into the
income categories by assuming that multiple earner households are, on average, formed of
individuals with similar incomes. KMA notes that there is potential for wide variation in the mix of
earner incomes within a multiple earner household, such as situations where young adults are
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living at home with their parents. Overall, KMA has found that this assumption is a reasonable
representation of the average situation.
Employee households not falling into one of the major occupation categories are assumed to have
the same income distribution as the major occupation categories.
Step 5 -Estimate of Household Size Distribution
In this step, household size distribution was input into the model in order to estimate the income
and household size combinations that meet the income definitions for San Diego County. The
household size distribution utilized in the analysis is that of worker households in San Diego
County derived using American Community Survey (ACS) data. The model employs a distribution
of the number of workers per household by household size. For example, four-person worker
households can have one, two, three, or four workers in the household. The model uses ACS data
to develop a distribution of the number of the workers per worker household, by household size.
Step 6 -Estimate of Households that Meet Size and Income Criteria
For this step KMA built a cross-matrix of household size and income to establish probability factors
for the two criteria in combination. For each occupational group a probability factor was
calculated for each income level and household size/number of workers combination, and
multiplied by the number of households. Appendix I -Tables C-2 and C-3 show the result after
completing Steps 4, 5, and 6. The calculated number of households that meet the size and income
criteria for the under 50% of AMI category generated by 100 market-rate prototype units are
shown in Appendix I -Table C-2. The methodology was repeated for the 50% to 80% AMI income
tier, as shown in Appendix I -Table C-3.
Summary Findings
Appendix I -Table C-4 presents the results of the analysis for the residential prototype units. The
table estimates the number of households generated in each affordability category and the total
number of households over 80% of AMI.
According to Appendix I -Table C-4, approximately 60% of new worker households generated by
the expenditures of new residents have incomes below 80% of AMI, with approximately half of
these households earning less than 50% of AMI. The finding that the jobs associated with
consumer spending tend to be low-paying jobs where the workers will require housing affordable
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at the lower income levels is not surprising. As noted above, direct consumer spending resu lts in
employment that is concentrated in lower paid occupations including food preparation,
administrative, and retail sales.
The findings in Appendix I -Table C-4 are summarized in Exhibit 19, which shows the total demand
t
for afford ab le housing units associat ed with 100 market-rate units.
Exhibit 19: New Worker Households by Income Level per 100 Market-Rate Units
Garden Stacked Flat Mixed-Use
Household Income Category Townhome Apartments Apartments Rental
Very low Upto 50% AMI 9.2 7.8 7.8 8.2
Low Greater than 50%
but not exceeding 8.1 6.9 6.9 7.2
80%AMI
Total, Less than 80% AMI 17.3 14.6 14.6 15.4
Greater t han 80% AM I 11.0 9.3 9.3 9.9
Total, New Households 28.4 24.0 24.0 25.3
Affordable Units Required to Mitigate Impact of Market-Rate Rental Housing
Some developers may choose to mitigate the impact of t heir developments by providing
affordable rental housing rather t han paying a fee. The analysis findings identify how many lower
income households are generated for every 100 market-rate units. These findings are adjusted to
show the percentages of affordable rental hou sing needed to mitigate the impact of market-rate
development. The percentages are calculated including both market-rate and affordable units (for
example, 25 affordable units per 100 market-rate units translates to a project of 125 units; 25
affordable units out of 125 units equals 20%}.
Exhibit 20 presents the results of the analysis, drawn from Appendix I -Table C-5, which contains
greater detail. Each tier is cumulative, or incl usive of the tiers above.
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Exhibit 20: Affordable Units Required to Mitigate Rental Housing Development
Garden Stacked Flat Mixed-Use
Household Income Category Townhome Apartments Apartments Rental
Very low: Up to 50% AMI 8.4% 7.2% 7.2% 7.6%
Very low Greater than 50%
but not exceeding 14.8% 12.8% 12.8% 13.4% and Low 80%AMI
The conclusion of the analysis is that a market-rate rental development would need to provide
13% to 15% of units affordable to lower-income households to mitigate the development's
impact. This range of impact in terms of demand for affordable housing is less than the 15%
requirement in the City's lnclusionary Housing Ordinance applicable to new market-rate
ownership housing (and previously applied to new market-rate rental housing as well).
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APPENDIX I
TABLE C-1
EMPLOYEE HOUSEHOLDS GENERATED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Prototype 2: Prototype 4:
Prototype 1: Garden Prototype 3: Mixed-Use
Town homes Apartments Stacked Flats Rental
I. Step 1 -Employees' 50.3 42.5 42.5 44.9
II. Step 2 -Adjustment for Number of Households (1.77)2 28.4 24.0 24.0 25.4
Ill. Step 3 -Occupation Distribution
Management Occupations 4.4% 4.4% 4.4% 4.4%
Business and Financial Operations 4.8% 4.8% 4.8% 4.8%
Computer and Mathematical 1.4% 1.4% 1.4% 1.4%
Architecture and Engineering 0.5% 0.5% 0.5% 0.5%
Life, Physical, and Social Science 0.3% 0.3% 0.3% 0.3%
Community and Social Services 1.8% 1.8% 1.8% 1.8%
Legal 0.8% 0.8% 0.8% 0.8%
Education, Training, and Library 2.7% 2.7% 2.7% 2.7%
Arts, Design, Entertainment, Sports, and Media 1.7% 1.7% 1.7% 1.7%
Healthcare Practitioners and Technical 7.2% 7.2% 7.2% 7.2%
Healthcare Support 4.5% 4.5% 4.5% 4.5%
Protective Service 1.3% 1.3% 1.3% 1.3%
Food Preparation and Serving Related 15.2% 15.2% 15.2% 15.2%
Building and Grounds Cleaning and Maint. 5.5% 5.5% 5.5% 5.5%
Personal Care and Service 6.5% 6.5% 6.5% 6.5%
Sales and Related 13.0% 13.0% 13.0% 13.0%
Office and Administrative Support 16.6% 16.6% 16.6% 16.6%
Farming, Fishing, and Forestry 0.1% 0.1% 0.1% 0.1%
Construction and Extraction 1.0% 1.0% 1.0% 1.0%
Installation, Maintenance, and Repair 3.9% 3.9% 3.9% 3.9%
Production 1.7% 1.7% 1.7% 1.7%
Transportation and Material Moving 5.3% 5.3% 5.3% 5.3%
Totals 100.0% 100.0% 100.0% 100.0%
Management Occupations 1.2 1.1 1.1 1.1
Business and Financial Operations 1.4 1.2 1.2 1.2
Computer and Mathematical 0.4 0.3 0.3 0.4
Architecture and Engineering 0.1 0.1 0.1 0.1
Life, Physical, and Social Science 0.1 0.1 0.1 0.1
Community and Social Services 0.5 0.4 0.4 0.5
Legal 0.2 0.2 0.2 0.2
Education, Training, and Library 0.8 0.6 0.6 0.7
Arts, Design, Entertainment, Sports, and Media 0.5 0.4 0.4 0.4
Healthcare Practitioners and Technical 2.0 1.7 1.7 1.8
Healthcare Support 1.3 1.1 1.1 1.1
Protective Service 0.4 0.3 0.3 0.3
Food Preparation and Serving Related 4.3 3.6 3.6 3.8
Building and Grounds Cleaning and Ma int. 1.6 1.3 1.3 1.4
Personal Care and Service 1.8 1.6 1.6 1.6
Sales and Related 3.7 3.1 3.1 3.3
Office and Administrative Support 4.7 4.0 4.0 4.2
Farming, Fishing, and Forestry 0.0 0.0 0.0 0.0
Construction and Extraction 0.3 0.2 0.2 0.3
Installation, Maintenance, and Repair 1.1 0.9 0.9 1.0
Production 0.5 0.4 0.4 0.4
Transportation and Material Moving 1.5 1.3 1.3 1.4
Totals 28.4 24.0 24.0 25.4
Estimated employment generated by expenditures of households within 100 prototypical market rate units. Employment estimates based on economic model,
IMPLAN.
Adjustment from number of workers to households using average of 1.77 workers per worker household derived from the U.S. Census American Community Survey
2011 to 2013.
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TABLE C-2
VERY-LOW INCOME EMPLOYEE HOUSEHOLDS1 GENERATED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Per 100 Market-Rate Units
Prototype 1:
Town homes
Prototype 2:
Garden
Apartments
I. Step 5 & 6 -Very-Low Income Households (under 50% AMI) within Major Occupation Categories
Management
Business and Financial Operations
Computer and Mathematical
Architecture and Engineering
Life, Physical and Social Science
Community and Social Services
Legal
Education Training and Library
Arts, Design, Entertainment, Sports, & Media
Healthcare Practitioners and Technical
Healthcare Support
Protective Service
Food Preparation and Serving Related
Building Grounds and Maintenance
Personal Care and Service
Sales and Related
Office and Admin
Farm, Fishing, and Forestry
Construction and Extraction
Installation Maintenance and Repair
Production
Transportation and Material Moving
II. Very Low Income Households -Major Occupations
Ill. Very Low Households1 -all other occupations
IV. Total Very Low Households1
0.01
0.01
0.16
0.02
0.45
2.43
0.69
0.86
1.41
1.15
0.15
0.65
7.99
1.22
9.21
1 Includes households earning from zero through 50% of San Diego County Area Median Income.
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0.01
0.01
0.14
0.02
0.38
2.05
0.58
0.73
1.20
0.97
0.12
0.55
6.76
1.03
7.79
Prototype 3:
Stacked Flats
0.01
0.01
0.14
0.02
0.38
2.05
0.58
0.73
1.20
0.97
0.12
0.55
6.76
1.03
7.79
APPENDIX I
Prototype 4:
Mixed-Use
Rental
0.01
0.01
0.15
0.02
0.40
2.16
0.62
0.77
1.26
1.02
0.13
0.58
7.13
1.09
8.22
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TABLE C-3
LOW INCOME EMPLOYEE HOUSEHOLDS1 GENERATED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Per 100 Market-Rate Units
Prototype 1:
Town homes
Prototype 2:
Garden
Apartments
APPENDIX I
Prototype 4:
Prototype 3: Mixed-Use
Stacked Flats Rental
I. Step 5 & 6 -Low Income Households (greater than 50% but not exceeding 80% AMI) within Major Occupation Categories
Management 0.07 0.06 0.06 0.07
Business and Financial Operations 0.13 0.11 0.11 0.12
Computer and Mathematical
Architecture and Engineering
Life, Physical and Social Science
Community and Social Services
Legal
Education Training and Library 0.21 0.18 0.18 0.19
Arts, Design, Entertainment, Sports, & Media
Healthcare Practitioners and Technical 0.13 0.11 0.11 0.12
Healthcare Support 0.44 0.37 0.37 0.39
Protective Service
Food Preparation and Serving Related 1.38 1.17 1.17 1.23
Building Grounds and Maintenance 0.52 0.44 0.44 0.46
Personal Care and Service 0.63 0.53 0.53 0.56
Sales and Related 1.13 0.96 0.96 1.01
Office and Admin 1.58 1.34 1.34 1.41
Farm, Fishing, and Forestry
Construction and Extraction
Installation Maintenance and Repair 0.31 0.26 0.26 0.27
Production
Transportation and Material Moving 0.50 0.43 0.43 0.45
II. Low Income Households -Major Occupations 7.03 5.95 5.95 6.27
Ill. Low Households1 -all other occupations 1.07 0.91 0.91 0.96
IV. Total Low Households1 8.10 6.86 6.86 7.23
1 Includes households earning from 50% through 80% of San Diego County Area Median Income.
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APPENDIX I
TABLE C-4
EMPLOYEE HOUSEHOLDS GENERATED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Per 100 Market-Rate Units
Prototype 2: Prototype 4:
Prototype 1: Garden Prototype 3: Mixed-Use
I. Number of New Households1 Town homes Apartments Stacked Flats Rental
Under 50% Area Median Income 9.2 7.8 7.8 8.2
50% to 80% Area Median Income 8.1 6.9 6.9 7.2
Subtotal through 80% of Median 17.3 14.6 14.6 15.4
Above 80% Area Median Income 11.0 9.3 9.3 9.9
Total Employee Households 28.4 24.0 24.0 25.3
II. Percent of New Households 1
Under 50% Area Median Income 32% 32% 32% 32%
50% to 80% Area Median Income 29% 29% 29% 29%
Subtotal through 80% of Median 61% 61% 61% 61%
Above 80% Area Median Income 39% 39% 39% 39%
Total Employee Households 100% 100% 100% 100%
Households of retail, education, healthcare and other workers that serve residents of new market-rate units.
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TABLE C-5
INCLUSIONARY REQUIREMENT SUPPORTED
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Prototype 1:
Town homes
Prototype 2:
Garden
Apartments
I. Affordable Unit Demand Per 100 Market-Rate Units -Cumulative Through
50% of Median Income 9 Units 8 Units
80% of Median Income 17 Units 15 Units
11. On-Site lnclusionary Percentage Supported -Cumulative Through 1
50% of Median Income 8.4% 7.2%
80% of Median Income 14.8% 12.8%
APPENDIX I
Prototype 3: Prototype 4:
Stacked Mixed-Use
Flats Rental
8 Units 8 Units
15 Units 15 Units
7.2% 7.6%
12.8% 13.4%
1 Calculated by dividing the supported number of affordable units by the total number of market-rate and affordable units.
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D. MITIGATION COSTS
This section takes the conclusions of the previous section on the number of households in the
Very low and Low-income categories associated with the market-rate rental units and identifies
the total cost of assistance required to make housing affordable. This section puts a cost on the
units for each income level to produce the "total nexus cost."
A key component of the analysis is the size of the gap between what households can afford and
the cost of producing new housing in Carlsbad, known as the 'affordability gap.' Affordability
gaps are calculated for each of the categories of Area Median Income (AMI): households
earning up to 50% of AMI (Very low income households), and between 50% and 80% of AMI
(Low-income households). A detailed description of the calculation of affordability gaps is
contained in Appendix II. A brief summary is included below.
Project Descriptions
In order to determine the affordability gap, there is a need to match a household at each
income level with a unit type and size according to government regulations and policies. The
underlying concept is that the City will use rental housing impact fee revenues to assist in the
provision of affordable units to mitigate the impacts of market-rate rental housing. The
analysis assumes that housing for Very low-and Low-income households will be provided in
garden apartments, the least expensive units. The prototypical affordable housing garden
apartment project is designed to represent what the City is most likely to assist in the future.
A detailed description of the affordable housing development prototype, including
development costs, affordable values, and the affordability gap calculations, can be found in
the tables at the end of this section. The affordable housing prototype was assumed as garden-
style apartments with wood-frame construction, built at a density of 25 units to the acre, with
one, two, and three-bedroom units, averaging 826 SF. Parking is provided at 1.5 spaces for the
one bedroom units, 2.0 spaces per unit for the two and three bedroom units, and 0.25 spaces
per unit for visitors.
For Very low-income households (households earning up to 50% AMI), rents are set at 30% of
50% of Area Median Income. For Low-income households (households earning up to 80% AMI),
maximum rents are calculated at 30% of 70% of Area Median Income. These are standards
widely used in affordable housing _analysis and are consistent with current City policy. These
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are also conservative assumptions, which produce a lower affordability gap than reality since
not all households have income at or near the top end of the range.
Development Costs
The cost of developing new residential units in Carlsbad was assembled from a number of
sources. Land costs were gathered from recent land sales data collected by KMA. KMA is also
actively working on a number of multi-family projects at various locations in the San Diego area
and has recent developer proforma financial analyses from which to draw cost information.
From the above sources, KMA prepared a summary of total development costs, broken down
into the major cost components: acquisition, direct or construction costs, indirect costs, and
financing costs. Housing development costs are intended as averages and generally reflect
rising construction costs, which have outpaced general economic inflation in 2014 and 2015, a
trend that is expected to continue in the next few years.
Affordability Gap
The KMA financial proforma estimating the affordability gap for a garden style apartment is
presented in Appendix II Tables B-1 through B-5. The proforma contains:
i. A project description;
ii. Estimates of development costs;
iii. Stabilized net operating income based on maximum rents at 70% AMI and 50% AMI;
iv. Estimates of maximum warranted investment; and
v. The resulting financing gap generated reflective of the difference between warranted
investment and development costs.
The inputs and assumptions used in the KMA proformas are based on KMA's experience with
comparable developments throughout San Diego County. In particular, KMA notes the
following:
• The cost estimates do not assume a prevailing wage requirement.
• The KMA proforma assumed land costs of $35 per square foot of land, reflecting project
location and achievable density.
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• As specific sites have not been defined for this study, KMA assumed an allowance for off-
site improvements at $3 per SF of site area, and an allowance for on-site improvements at
$10 per SF of site area.
• The Very low income units (for households earning up to 50% AMI) are assumed to be
financed with Low Income Housing Tax Credits and tax-exempt bond financing. The Low-
income units (for households earning up to 80% AMI) are assumed to be financed using
conventional debt and equity financing sources.
Exhibit 21 provides a summary of the affordability gaps used in the analysis:
Exhibit 21: Affordability Gap Per Unit -Garden Apartments
Very low-income Low-income
$134,000 $137,800
E. TOTAL NEXUS COSTS
The last step in the nexus analysis marries the findings on the numbers of households in each of
the lower income ranges associated with the four prototypes to the affordability gaps, or the
costs of delivering rental housing to them in Carlsbad.
Appendix I -Table E-1 summarizes the analysis. The affordability gaps are drawn from the prior
discussion. The "nexus cost per market-rate unit" shows the results of the following
calculation: the affordability gap times the number of affordable units demanded per market-
rate rental unit. (Demand for affordable units for each of the income ranges is drawn from
Table C-5 in the previous section and is adjusted to a per-unit basis from the 100-unit building
module.)
The total nexus costs for the four prototypes are presented in Exhibit 22:
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Exhibit 22: Maximum Supported Fee Level Per Market-Rate Unit
Affordability Garden Stacked Flat Mixed-Use
Household Income Category Gap Townhome Apartments Apartments Rental
Ve ry low Upto 50% AMI $134,000 $12,300 $10,400 $10,400 $11,000
Low Greater than
50% but not $137,800 $11,200 $9,400 $9,400 $10,000 exceeding 80%
AMI
M aximum Supported Fee $23,500 $19,800 $19,800 $21,000 Level
These costs express the total nexu s costs for the four prototype developments in the City of
Carlsbad. These total nexus costs represent the ceiling for any requirement placed on market-
rate development. The totals are not recommended levels for fees; they represent only the
maximums established by this analysis, below which fees may be set.
The total nexus costs indicated above may also be expressed on a per-square-foot level. The
square foot area of the prototype unit used throughout the analysis becomes the basis for the
calculation. Again, see Appendix II for more discu ssion of the prototypes. Exhibit 23 provides
the results per square foot:
Exhibit 23: Total Nexus Cost Per Square Foot
Household Income Category
Prototype Size (SF)
Very low Upto 50%AMI
Low Greater than
50% but not
exceeding 80%
AMI
Total Nexus Costs
(1) Allow for rounding error.
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Affordability
Gap
$134,000
$137,800
Garden
Townhome Apartments
1,250 SF 860 SF
$10 $12
$9 $11
$19 $23
Stacked Flat
Apartments
820SF
$13
$12
$24
Mixed-Use
Rental
750SF
$15
$13
$28
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TABLE E-1
SUPPORTED FEE/ NEXUS SUMMARY PER SQUARE FOOT
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Household Income Level
Under 50% Area Median Income
50% to 80% Area Median Income
Total Supported Fee/ Nexus
Affordability
Gap Per Unit
Avg. Unit Size (SF)
Household Income Level
Under 50% Area Median Income $134,000 1
50% to 80% Area Median Income $137,800 1
Total Supported Fee/ Nexus
Prototype 1:
Town homes
$12,300
$11,200
$23,500
Prototype 1:
Town homes
1,250 SF
$9.90
$8.90
$18.80
Nexus Cost Per Market Rate Unit
Prototype 2:
Garden
Apartments
$10,400
$9,400
$19,800
Prototype 3:
Stacked Flats
$10,400
$9,400
$19,800
Nexus Cost Per Square Foot2
Prototype 2:
Garden Prototype 3:
Apartments Stacked Flats
860 SF 820 SF
$12.10 $12.70
$11.00 $11.50
$23.10 $24.20
1 Assumes affordable rental units. Affordability gaps represent the remaining affordability gap after tax credit financing.
Prototype 4:
Mixed-Use
Rental
$11,000
$10,000
$21,000
Prototype 4:
Mixed-Use
Rental
750 SF
$14.70
$13.30
$28.00
2 Nexus cost per square foot computed by multiplying affordable unit demand from Table C-4 by the affordability gap and then dividing by
the average unit size.
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APPENDIX I
Page 53
ADDENDUM: NOTES ON SPECIFIC ASSUMPTIONS
Geographic Area of Impact
The analysis quantifies impacts occurring within San Diego County. The IMPLAN model
computes the jobs generated within the County and sorts out those that occur beyond the
County boundaries.
Job impacts, like most types of impacts, occur irrespective of political boundaries. And like
other types of impact analyses, such as traffic, impacts beyond city boundaries are experienced,
are relevant, and are important. Without an area-wide program to mitigate affordable housing
impacts of all development, Carlsbad can ensure that those affordable housing impacts created
by development within its jurisdiction are at least partially mitigated.
Economic impact analyses are often conducted to demonstrate the jobs and dollar costs and
benefits of major projects, such as, say, a sports stadium or the closing of a military base. It is
standard practice in economic impact analyses to identify the geographic area or areas for
which the impacts are being computed. In this case, the job impacts within San Diego County
are quantified and where the job holders (or worker households) live is not identified but would
be within commuting distance to San Diego County. Whether a jurisdiction chooses to mitigate
none, all, or a share of the impacts of its actions or activities is a matter of policy.
For clarification, counting all impacts associated with new rental housing units does not result
in double counting, even if all jurisdictions were to adopt similar programs and charge
affordable housing fees. The impact of a new housing unit is only counted once, in the
jurisdiction in which it occurs. Obviously, within a metropolitan region, there is much
commuting among jurisdictions, and cities house each others' workers in a very complex web of
relationships. The important point is that impacts of residential rental development are only
counted once. For jurisdictions that have housing programs on both residential and non-
residential development, such as San Diego, KMA provides an analysis to demonstrate that
double counting has not occurred. However, Carlsbad does not charge a commercial linkage
fee to non-residential development.
Affordability Gaps
The use of the affordability gap for establishing a maximum fee supported from the nexus
analysis is grounded in the concept that affordable units will be built to mitigate impacts. The
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nexus analysis has established that units will be needed at one or more different affordability
levels and, per local policy, the type of unit to be delivered depends on the income/affordability
level. Most commonly, Very low-and Low-income households are assumed accommodated in
rental units.
The rental units assisted by the public sector for affordable households are usually small in
square foot area (for the number of bedrooms) and modest in finishes and amenities. As a
result, in some communities these units are similar in physical configuration to what the market
is delivering at market-rate; in other communities (particularly very high income communities),
they may be smaller and more modest than what the market is delivering. Parking, for
example, is usually the minimum permitted by the code. ln_some communities where there is a
wide range in land cost per acre or per unit, it may be assumed that affordable units are built
on land parcels in the lower portion of the cost range. KMA tries to develop a total
development cost summary that represents the lower half of the average range, but not so low
as to be unrealistic.
If the affordability gap is the difference between total development cost and sources of funds,
the question sometimes arises as to how total development cost is defined. KMA defines total
development costs as including land costs, construction costs, site improvements, architectural
and engineering, financing and all other indirect costs, and an allowance for an industry profit
(non-profit developers receive a development fee instead).
Non-profit developers usually experience the same land and construction costs but do have
differences in their financing costs, other indirect expenses, and fee structures. The end result,
on average, is a total cost that is comparable to that experienced by for-profit developers. No
prevailing wage requirement is assumed for either case. It is sometimes thought that the cost
structure for non-profits is higher than for for-profit developers; for purposes of an affordability
gap average, we take the position that costs are essentially the same.
Development of market-rate rental units has been constrained for a number of years now in
many California cities. However, current market rent levels in Carlsbad are strong enough to
cover the costs of new development. As a result, total development cost summaries for rental
units are drawn from current construction costs and the full complement of indirect costs that
would be necessary to build an apartment structure. Affordability gaps are the difference
between the value of the unit at restricted or affordable rent levels and the development costs.
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Excess Capacity of Labor Force
At the time this analysis has been conducted, the national, regional, and local economy are all
experiencing continued recovery from a severe recession. Unemployment in California
averages just over 6.3%. In this context, the question has been raised as to whether there is
excess capacity in the labor force to the extent that consumption impacts generated by new
households will be, in part, absorbed by existing jobs and workers, thus resulting in fewer net
new jobs.
In response, an impact analysis of this nature is a one-time impact requirement to address
impacts generated over the life of the project. The economic downturn was temporary
condition; a healthy economy is returning and its impacts will be experienced.
Additionally, the economic cycle self-adjusts. Development of new residential units will occur
as conditions continue to improve. When this occurs, the improved economic condition of the
households in the local area will absorb the current underutilized capacity of existing workers,
employed and unemployed. By the time new units become occupied, current conditions will
have likely improved.
The Burden of Paying for Affordable Housing
The City's housing programs, including the existing inclusionary program and proposed impact
fee, do not place all burdens for the creation of affordable housing on new residential
construction. The burden of affordable housing is borne by many sectors of the economy and
society. A most important source in recent years of funding for affordable housing
development comes from the Federal government in the form of tax credits (which result in
reduced income tax payment by tax credit investors in exchange for equity funding).
Additionally there are other Federal grant and loan programs administered by the Department
of Housing and Urban Development and other Federal agencies. The State of California also
plays a major role with a number of special financing and funding programs. Much of the State
money is funded by voter-approved bond measures paid for by all Californians.
Local governments have increasingly played a greater role in affordable housing. In addition,
private sector lenders play an important role. Then there is the non-profit sector, both
sponsors and developers that build much of the affordable housing.
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To date the City has assisted in the production of 2,105 affordable units, including 1,871 units
produced as a result of the City's inclusionary housing requirements.
In summary, all levels of government and many private parties, for-profit and non-profit,
contribute to supplying affordable housing. Developers of market-rate rental housing are not
being asked to bear the burden alone any more than they are assumed to be the only source of
demand or cause for needing affordable housing in our communities. The City's Regional
Housing Needs Allocation indicates the need for over 1,605 Very low-and Low-income units.
The City's inclusionary program and proposed impact fee program will result in the
construction, or funding, of only a small percentage of the affordable housing needed in the
City of Carlsbad.
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APPENDIX II: RESIDENTIAL VALUES-MARKET AND AFFORDABLE
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INTRODUCTION AND OVERVIEW
This appendix section provides the building blocks for the values used in other sections of this
report, by establishing both market values and affordable values for various types of residential
units or projects potentially developed in the City of Carlsbad.
Market values are based on surveys of residential units or developments in the City of Carlsbad
covering a range of residential types. Affordable values are formula-based, starting from the
San Diego County Area Median Income and amounts "affordable" for housing per State and
local policies. The difference between market and affordable values for any given residential
unit type, assuming a fixed unit size and occupying household, is referred to as the affordability
gap. The affordability gaps play a major role in the calculation of the maximum supportable fee
based on this nexus study.
A. MARKET VALUES
Market Surveys and Timing Issues
The surveys summarized in Appendix II Table A-1 were conducted in Fall 2015. As of the time of
this writing, the multi-family housing market in Carlsbad continues its upward growth, as
measured by rent and vacancy factors.
As of this writing in early 2016, conditions in the multi-family housing market in San Diego are
strong with rents continuing to move in an upward direction, while vacancies have remained
fairly stable in the 3% range. Strong employment growth and in-migration into the region have
further strengthened pent-up demand for apartments. In short, the rental market is projected
to continue to strengthen, with significant new construction underway or anticipated within the
next two years.
Market Value Conclusions
The market value conclusions, based on aH the surveys and indices, for analysis and program -
design purposes are presented in Appendix II -Tables A-2 through A-15 and are as follows:
• A townhome unit, built at an average density of 12 units to the acre. Includes a mix of two
and three bedrooms, averaging 1,250 square feet (SF) renting for $2,360.
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• A garden apartment unit in a project with an average density of 20 units per acre. Includes
one, two, and three bedroom units averaging 860 SF. Market rent is estimated at $1,972
per month.
• A stacked flat apartment unit in a project with an average density of 30 units per acre.
Includes a mix of one and two bedroom units, averaging 820 SF, renting for $1,987 per
month.
• Mixed-use stacked flats over ground floor retail with an average density of 28 units per
acre. Includes one and two bedroom units averaging 750 SF and 3,000 SF of retail space on
the ground floor. Average market rent is estimated at $2,091 per month for the residential
component and $3.00 per SF per month triple-net (NNN) for the commercial component.
The rent required for the rental projects represents the upper end of current rent levels in the
City of Carlsbad (see Appendix II Table A-1). Based on our analysis, rents will have to
approximate the level used in this analysis for new construction (without government
assistance) to be feasible.
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TABLE A-1
SURVEY OF RENTAL APARTMENT DEVELOPMENTS, CARLSBAD (1)
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
:.
Wel&hted Avera11es .
oevelooment/OWner
Adams Street Apartments
Oakley Parker
Bluwater Crossing
Riverstane Residential Group
Carlsbad Coast
G. W. Williams
Costa Ponte
Dolphin Beach Apartments
Jeff Hermanson
Eaves Carlsbad
Avalon Bay Communities Inc.
Elan Alicante La Costa
Turf Club View Limited
Elan Beach Pointe
Mark Gosselin
Flower Fields
Alliance Residential Company
Marbella
Irvine Company
Pacific View Apartment Homes
Irvine Company
Park Place -Carlsbad
Dwiaht Spiers
Ridgeview Condos
Edward Boseker
Rising Glen Apartments
R & V Manaqement
Santa Fe Ranch
Henderson Global Investors
Seagate Village Condominiums
HG Fenton Companv
Seascape Apartment Homes
Irvine Company
Sommerset La Costa
Silverado Canyon Partners
The Arbors -Carlsbad
The Bluffs At Carlsbad
Triumph Management Company
The Tradition Apartment Homes
Con Am Group of Companies
The Village Apartments
Villaae Properties
The Villas At Carlsbad
United Dominion Realtv Trust (UDR)
Villas La Costa
TNT Gibralter Ltd./Barbara Ahlers
Windsor At Aviara
Windsor Communities
Carlsbad
(1) As of third quarter 2015.
(2) Excludes affordable units.
Source: MarketPointe Realty Advisors
Prepared by: Keyser Marston Associates, Inc.
Rent .. SF' ..
$1,331 725
$3,277 2,311
$1,641 768
$3,020 1,762
$2,100 1,200
$1,455 759
$1,953 1,054
$1,708 788
$1,800 1,013
$2,173 957
$2,269 961
$1,698 976
$1,517 1,103
$1,847 875
$1,806 858
$1,956 1,103
$1,704 817
$2,000 1,100
$1,839 1,078
$1,436 571
$2,317 1,277
$1,115 800
$1,632 885
$1,548 1,053
$2,082 893
$1,919 947
Filename: i: Carlsbad_Nexus Study Update_ Technical Analysis_v1;2/18/2016;1ag
$/SF
$1.84
$1.42
$2.14
$1.71
$1.75
$1.92
$1.85
$2.17
$1.78
$2.27
$2.36
$1.74
$1.38
$2.11
$2.10
$1.77
$2.09
$1.82
$1.71
$2.51
$1.81
$1.39
$1.84
$1.47
$2.33
$2.03
APPENDIX II
Rani!! Vaclil'icy
Rent SF $/sF· .· Units Rate'
$1,250 655 $1.85 74 1.4%
$1,450 785 $1.91
$2,570 1,354 $1.30 66 3.0%
$3,650 2,767 $2.01
$1,148 415 $1.79 72 5.6%
$1,913 900 $3.34
$2,550 1,326 $1.61 49 0.0%
$3,295 2,042 $1.92
$2,100 1,200 $1.75 40 2.5%
$2,100 1,200 $1.75
$1,325 400 $1.80 450 7.8%
$1,615 848 $3.31
$1,845 1,000 $1.85 74 6.8%
$2,245 1,200 $1.87
$1,400 420 $1.90 44 4.5%
$1,900 1,000 $3.33
$1,607 668 $1.84 132 6.8%
$2,145 1,074 $2.41
$1,930 667 $1.94 143 4.9%
$2,785 1,240 $2.89
$1,840 662 $1.97 434 4.8%
$2,985 1,378 $2.89
$1,675 954 $1.72 44 0.0%
$1,725 988 $1.76
$1,500 1,085 $1.32 69 0.0%
$1,700 1,292 $1.38
$1,722 678 $1.86 195 5.6%
$2,200 1,182 $2.54
$1,640 679 $1.89 320 1.6%
$1,748 924 $2.42
$1,935 1,084 $1.72 272 2.9%
$2,530 1,145 $2.31
$1,765 670 $1.99 -208 4.3%
$1,890 950 $2.63
$2,250 1,100 $2.05 48 4.2%
$2,250 1,100 $2.05
$1,510 640 $1.41 58 0.0%
$2,120 1,500 $2.52
$1,365 451 $2.29 163 2.5%
$1,535 670 $3.03
$2,130 1,123 $1.54 157 5.7%
$2,440 1,380 $1.99
$1,115 800 $1.39 98 0.0%
$1,115 800 $1.39
$1,250 500 $1.46 102 2.9%
$2,000 1,300 $2.50
$1,548 1,050 $1.46 24 0.0%
$1,548 1,060 $1.47
$1,715 625 $1.89 288 3.8%
$2,915 1,546 $2.79
$1,115 400 $1.30 3,624 4.1%
$3,650 2,767 $3.34
Page 61
Market-Rate Prototypes
Town homes
Affordable Housing Impact Fee Nexus Study
City of Carlsbad
TABLE A-2
PROJECT DESCRIPTION
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Site Area 12.00 Acres
II. Gross Building Area
Residential Area 180,000 SF
Common Area Q SF 100%
Total Gross Building Area (GBA) 180,000 SF 0%
100%
Ill. Unit Mix # of Units
One Bedroom 0 Units 0%
Two Bedroom 72 Units 50%
Three Bedroom 72 Units 50%
Total 144 Units 100%
IV. Number of Stories 2 Stories
V. Density 12.0 Units/Acre
VI. Construction Type TypeV
VII. Parking
Parking Type Attached Garage
Number of Spaces
Two and Three Bedroom 2.0 Spaces/Unit 288 Spaces
Visitor 0.25 Spaces/Unit 36 Spaces
Total Spaces 324 Spaces
Prepared by: Keyser Marston Associates, Inc.
Filename i:\Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
APPENDIX II
TOWN HOMES
Unit Size
1,100 SF
1.400 SF
1,250 SF
Page 62
TABLE A-3
ESTIMATED DEVELOPMENT COSTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Acquisition Costs
II. Direct Costs (1)
Off-Site Improvements (2)
On-Site Improvements/Landscaping
Parking
Shell Construction
Amenities/FF&E
Contingency
Total Direct Costs
Ill. Indirect Costs
Architecture & Engineering
Permits & Fees (3)
Legal & Accounting
Taxes & Insurance
Developer Fee
Marketing/Lease-Up -Residential
Contingency
Total Indirect Costs
IV. Financing Costs
V. Total Development Costs
(1) Does not include the payment of prevailing wages.
(2) KMA gross estimate. Not verified by KMA or the City.
(3) Per City.
Prepared by: Keyser Marston Associates, Inc.
Totals Per Unit
$13,068,000 $90,800
$1,568,000 $10,900
$5,227,000 $36,300
$0 $0
$18,000,000 $125,000
$100,000 $700
$1,245,000 $8,600
$26,140,000 $181,500
$1,046,000 $7,300
$2,232,000 $15,500
$261,000 $1,800
$261,000 $1,800
$1,046,000 $7,300
$360,000 $2,500
$156,000 $1,100
$5,362,000 $37,200
$2,614,000 $18,200
$47,184,000 $327,700
Filename: Carlsbad_Nexus Study Update_Technical Analysis_vl\2/18/2016;1ag
APPENDIX II
TOWN HOMES
Notes
$25 Per SF Site
$3 Per SF Site
$10 Per SF Site
Included above
$100 Per SF GBA -Res.
Allowance
5.0% of Directs
$145 Per SF GBA
4.0% of Directs
$12 Per SF GBA
1.0% of Directs
1.0% of Directs
4.0% of Directs
Allowance
3.0% of Indirects
20.5% of Directs
10.0% of Directs
$262 Per SF GBA
Page 63
TABLE A-4
NET OPERATING INCOME AND FINANCING SURPLUS/(DEFICIT)
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Gross Scheduled Income (GSI)
Two Bedroom Townhome
Three Bedroom Townhome
Total/ Average
Add: Other Income
Total Gross Scheduled Income (GSI)
(Less) Vacancy
Effective Gross Income (EGI)
II. Operating Expenses
(Less) Operating Expenses
(Less) Property Taxes (1)
(Less) Replacement Reserves
Total Expenses
Ill. Net Operating Income (NOi)
IV. Capitalized Value
Net Operating Income
Capitalization Rate
Capitalized Value
(Less) Cost of Sale
(Less) Developer Profit
Net Sales Proceeds
V. (Less) Development Costs
VI. Financing Surplus/(Deficit)
Unit Size
1,100 SF
1,400 SF
1,250 SF
#of
Units
72
72
144
$/Month
$1.94 $2,130
$1.85 $2,590
$1.89 $2,360
$12 /Unit/Month
5.0% ofGSI
$4,200 /Unit/Year
$3,764 /Unit/Year
$250 /Unit/Year
$8,215 /Unit/Year
30.4% of EGI
$376,600 /Unit
3.0%
10.0%
$0 /Unit
(1) Based on capitalized income approach; assumes a 1.0% tax rate and 5.0% cap rate.
Prepared by: Keyser Marston Associates, Inc.
Filename i: \Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
APPENDIX II
TOWN HOMES
Annual
$1,840,700
$2,238,000
$4,078,700
$21,000
$4,099,700
{$205,000)
$3,894,700
($605,000)
($542,000)
{$36,000}
($1,183,000)
$2,711,700
$2,711,700
5.0%
$54,234,000
($1,627,000)
{$5,423,000)
$47,184,000
{$47,184,000}
$0
Page 64
Market-Rate Prototypes
Garden Apartments
Affordable Housing Impact Fee Nexus Study
City of Carlsbad
APPENDIX II
TABLE A-5 GARDEN APARTMENTS
PROJECT DESCRIPTION
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Site Area
II. {:jross Building Area
Residential Area
Common Area
Total Gross Building Area (GBA)
Ill. Unit Mix
One Bedroom
Two Bedroom
Three Bedroom
Total
IV. Number of Stories
9.00 Acres
154,800 SF 95%
8,147 SF 5%
162,947 SF 100%
# of Units Unit Size
54 Units 30% 700 SF
108 Units 60% 900 SF
18 Units 10% 1,100 SF
180 Units 100% 860 SF
2 - 3 Stories
V. Density 20.0 Units/Acre
VI. Construction Type TypeV
VII. Parking
Number of Spaces
One Bedroom 1.5 Spaces/Unit 81 Spaces
Two and Three Bedroom 2.0 Spaces/Unit 252 Spaces
Visitor 0.25 Spaces/Unit 45 Spaces
Total 378 Spaces
Parking Type
Garage Spaces 25% of Total 95 Spaces
Carport Spaces 1.0 Space/Unit 180 Spaces
Surface Spaces 103 Spaces
Total 378 Spaces
Prepared by: Keyser Marston Associates, Inc.
Filename i:\Carlsbad_Nexus Study Update_ Technical Analysis_v1;2/18/2016;Iag Page 65
TABLE A-6
ESTIMATED DEVELOPMENT COSTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Totals
I. Acquisition Costs $11,761,000
II. Direct Costs (1)
Off-Site Improvements (2) $1,176,000
On-Sites/Landscaping $3,920,000
Parking -Carport $360,000
Parking -Garage $950,000
Shell Construction $18,739,000
FF&E/ Amenities $100,000
Contingency $1,262,000
Total Direct Costs $26,507,000
Ill. Indirect Costs
Architecture & Engineering $1,060,000
Permits & Fees (3) $2,790,000
Legal & Accounting $265,000
Taxes & Insurance $265,000
Developer Fee $1,060,000
Marketing/Lease-Up $450,000
Contingency $177,000
Total Indirect Costs $6,067,000
IV. Financing Costs $2,651,000
Per Unit
$65,300
$6,500
$21,800
$2,000
$5,300
$104,100
$600
$7,000
$147,300
$5,900
$15,500
$1,500
$1,500
$5,900
$2,500
$1,000
$33,700
$14,700
V. Total Development Costs $46,986,000 $261,000
(1) Does not assume payment of prevailing wages.
(2) KMA gross estimate. Not verified by KMA or the City.
(3) Per City.
Prepared by: Keyser Marston Associates, Inc.
Filename: i: Carlsbad_Nexus Study Update_ Technical Analysis_v1;2/18/2016;1ag
APPENDIX II
GARDEN APARTMENTS
Comments
$30 Per SF Site
$3 Per SF Site
$10 Per SF Site
$2,000 Per Carport Space
$10,000 Per Garage Space
$115 Per SF GBA
Allowance
5.0% of Directs
$163 Per SF GBA
4.0% of Directs
$17 Per SF GBA
1.0% of Directs
1.0% of Directs
4.0% of Directs
Allowance
3.0% of Indirects
22.9% of Directs
10.0% of Directs
$288 Per SF GBA
Page 66
TABLE A-7
NET OPERATING INCOME AND FINANCING SURPLUS/(DEFICIT)
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Gross Scheduled Income (GSI)
One Bedroom
Two Bedroom
Three Bedroom
Total/ Average
Add: Other Income
Total Gross Scheduled Income (GSI)
(Less) Vacancy
Effective Gross Income (EGI)
II. Operating Expenses
(Less) Operating Expenses
(Less) Property Taxes (1)
(Less) Replacement Reserves
Total Expenses
Ill. Net Operating Income (NOi)
IV. Capitalized Value
Net Operating Income
Capitalization Rate
Capitalized Value
(Less) Cost of Sale
(Less) Developer Profit
Net Sales Proceeds
V. (Less) Development Costs
VI. Financing Surplus/(Deficit)
Unit Size
700 SF
900 SF
1,100 SF
860 SF
# of
Units
54
108
18
180
APPENDIX II
GARDEN APARTMENTS
$/Month
$2.35 $1,650
$2.31 $2,079
$2.25 $2,480
$2.29 $1,972
$15 /Unit/Month
5.0% of GSI
$4,400 /Unit/Year
$3,000 /Unit/Year
$250 /Unit/Year
$7,650 /Unit/Year
33.8% of EGI
$300,000 /Unit
3.0%
10.0%
$0 /Unit
Annual
$1,069,000
$2,654,550
$536,000
$4,259,550
$32,400
$4,291,950
($214,600)
$4,077,350
($792,000)
($540,000)
($45,000)
($1,377,000)
$2,700,350
$2,700,350
5.0%
$54,007,000
($1,620,000)
($5,401,000)
$46,986,000
($46,986,000)
$0
(1) Based on capitalized income approach; assumes a 1.0% tax rate and 5.0% cap rate.
Prepared by: Keyser Marston Associates, Inc.
Filename i: \Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;rks Page 67
Market-Rate Prototypes
Stacked-Flats
Affordable Housing Impact Fee Nexus Study
City of Carlsbad
TABLE A-8
PROJECT DESCRIPTION
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Site Area 7.00 Acres
II. Gross Building Area
Residential Area 172,200 SF
Common Area 19,133 SF
Total Gross Building Area (GBA) 191,333 SF
Ill. Unit Mix # of Units
One Bedroom 84 Units
Two Bedroom 126 Units
Three Bedroom Q Units
Total 210 Units
IV. Number of Stories 3 Stories
V. Density 30.0 Units/Acre
VI. Construction Type TypeV
VII. Parking
Number of Spaces
One Bedroom 1.5 Spaces/Unit
Two and Three Bedroom 2.0 Spaces/Unit
Visitor 0.25 Spaces/Unit
Total
Parking Type
Garage Spaces 25% of Total
Carport Spaces 1.0 Space/Unit
Surface Spaces
Total
Prepared by: Keyser Marston Associates, Inc.
90%
10%
100%
Unit Size
40% 700 SF
60% 900 SF
0% 1,100 SF
100% 820 SF
126 Spaces
252 Spaces
53 Spaces
431 Spaces
108 Spaces
210 Spaces
113 Spaces
431 Spaces
Filename i:\Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;Iag
APPENDIX II
STACKED-FLA TS
Page 68
TABLE A-9
ESTIMATED DEVELOPMENT COSTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Acquisition Costs
II. Direct Costs (1)
Off-Site Improvements (2)
On-Site Improvements/Landscaping
Parking -Carport
Parking -Garage
Shell Construction
Amenities/FF&E
Contingency
Total Direct Costs
Ill. Indirect Costs
Architecture & Engineering
Permits & Fees (3)
Legal & Accounting
Taxes & Insurance
Developer Fee
Ma rketi ng/Lease-U p
Contingency
Total Indirect Costs
IV. Financing Costs
V. Total Development Costs
(1) Does not include the payment of prevailing wages.
(2) KMA gross estimate. Not verified by KMA or the City.
(3) Per City.
Prepared by: Keyser Marston Associates, Inc.
Totals Per Unit
$12,197,000 $58,100
$915,000 $4,400
$3,049,000 $14,500
$420,000 $2,000
$1,080,000 $5,100
$24,873,000 $118,400
$250,000 $1,200
$1,529,000 $7,300
$32,116,000 $152,900
$1,285,000 $6,100
$3,255,000 $15,500
$321,000 $1,500
$321,000 $1,500
$1,285,000 $6,100
$525,000 $2,500
$210,000 $1,000
$7,202,000 $34,300
$3,212,000 $15,300
$54,727,000 $260,600
Filename: Carlsbad_Nexus Study Update_Technical Analysis_vl\2/18/2016;1ag
APPENDIX II
STACKED-FLA TS
Notes
$40 Per SF Site
$3 Per SF Site
$10 Per SF Site
$2,000 Per Carport Space
$10,000 Per Garage Space
$130 Per SF GBA
Allowance
5.0% of Directs
$168 Per SF GBA
4.0% of Directs
$17 Per SF GBA
1.0% of Directs
1.0% of Directs
4.0% of Directs
Allowance
3.0% of Indirects
22.4% of Directs
10.0% of Directs
$286 Per SF GBA
Page 69
TABLE A-10
NET OPERATING INCOME AND FINANCING SURPLUS/(DEFICIT}
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Gross Scheduled Income (GSI}
One Bedroom
Two Bedroom
Total/ Average
Add: Other Income
Total Gross Scheduled Income (GSI)
(Less) Vacancy
Effective Gross Income (EGI)
II. Operating Expenses
(Less) Operating Expenses
(Less) Property Taxes (1)
(Less) Replacement Reserves
Total Expenses
Ill. Net Operating Income (NOi}
IV. Capitalized Value
Net Operating Income
Capitalization Rate
Capitalized Value
(Less) Cost of Sale
(Less) Developer Profit
Net Sales Proceeds
v. (Less) Development Costs
VI. Financing Surplus/(Deficit)
Unit Size
700 SF
900 SF
820 SF
# of
Units
84
126
210
APPENDIX II
STACKED-FLATS
$/Month
$2.50 $1,750
$2.38 $2,145
$2.42 $1,987
$15 /Unit/Month
5.0% ofGSI
$4,600 /Unit/Year
$2,995 /Unit/Year
$250 /Unit/Year
$7,848 /Unit/Year
34.4% of EGI
$299,500 /Unit
3.0%
10.0%
$0 /Unit
Annual
$1,764,000
$3,243,700
$5,007,700
$37,800
$5,045,500
($252,300)
$4,793,200
($966,000)
($629,000)
($53,000)
($1,648,000)
$3,145,200
$3,145,200
5.0%
$62,904,000
($1,887,000)
($6,290,000)
$54,727,000
($54,727,000)
$0
(1) Based on capitalized income approach; assumes a 1.0% tax rate and 5.0% cap rate.
Prepared by: Keyser Marston Associates, Inc.
Filename i: \Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag Page 70
Market-Rate Prototypes
Mixed-Use Rental
Affordable Housing Impact Fee Nexus Study
City of Carlsbad
TABLEA-11
PROJECT DESCRIPTION
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Site Area
II. Gross Building Area
Residential Area
Common Area
Total Residential
Retail Area
Total Gross Building Area
Ill. Unit Mix
One Bedroom
Two Bedroom
Three Bedroom
Total
IV. Number of Stories
Residential
Retail
Total
V. Density
VI. Construction Type
VII. Parking
0.50 Acre
10,500 SF 95%
553 SF 5%
11,053 SF 100%
3,000 SF
14,053 SF
# of Units
7 Units 50%
7 Units 50%
Q Units 0%
14 Units 100%
2 Stories
1 Story (ground floor)
3 Stories
28.0 Units/Acre
TypeV
Unit Size
650 SF
850 SF
1,000 SF
750 SF
Parking Type Surface and Tuck-Under
Number of Spaces -Residential
One Bedroom
Two and Three Bedroom
Visitor
Total
Number of Spaces -Retail
Total Number of Spaces
Prepared by: Keyser Marston Associates, Inc.
1.5 Spaces/Unit
2.0 Spaces/Unit
0.25 Spaces/Unit
1.0 Space/300 SF
10.5 Spaces
14 Spaces
.1 Spaces
28 Spaces
10 Spaces
38 Spaces
Filename i:\Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;Iag
APPENDIX II
MIXED-USE RENTAL
Page 71
TABLE A-12
ESTIMATED DEVELOPMENT COSTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Acquisition Costs
II. Direct Costs (1)
Off-Site Improvements (2)
Demolition
On-Site Improvements/Landscaping
Parking
Shell Construction -Residential
Shell Construction -Retail
Tenant Improvements -Retail
Amenities/FF&E
Contingency
Total Direct Costs
Ill. Indirect Costs
Architecture & Engineering
Permits & Fees (3)
Legal & Accounting
Taxes & Insurance
Developer Fee
Marketing/Lease-Up -Residential
Marketing/Lease-Up -Retail
Contingency
Total Indirect Costs
IV. Financing Costs
V. Total Development Costs
(1) Does not include the payment of prevailing wages.
(2) KMA gross estimate. Not verified by KMA or the City.
APPENDIX II
MIXED-USE RENTAL
Totals Per Unit Notes
$1,307,000 $93,400 $60 Per SF Site
$65,000 $4,600 $3 Per SF Site
$50,000 $3,600 Allowance
$218,000 $15,600 $10 Per SF Site
$95,000 $6,800 $10,000 Per Space @ 25%
$1,658,000 $118,400 $150 Per SF GBA -Res.
$345,000 $24,600 $115 Per SF GBA -Retail
$75,000 $5,400 $25 Per SF -Retail
$35,000 $2,500 Allowance
$127,000 $9,100 5.0% of Directs
$2,668,000 $190,600 $190 Per SF GBA
$160,000 $11,400 6.0% of Directs
$253,000 $18,100 $18 Per SF GBA
$27,000 $1,900 1.0% of Directs
$27,000 $1,900 1.0% of Directs
$107,000 $7,600 4.0% of Directs
$35,000 $2,500 Allowance
$24,000 $1,700 $8 Per SF GBA -Retail
$18,000 $1,300 3.0% of Indirects
$651,000 $46,500 24.4% of Directs
$267,000 $19,100 10.0% of Directs
$4,893,000 $349,500 $348 Per SF GBA
(3) Per City. Reflects $15,474 per unit and $36,000 for the retail and parking components.
Prepared by: Keyser Marston Associates, Inc.
Filename: Carlsbad_Nexus Study Update_Technical Analysis_vl\2/18/2016;1ag Page 72
TABLE A-13
NET OPERATING INCOME AND CAPITALIZED VALUE -RESIDENTIAL
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Gross Scheduled Income (GSI)
One Bedroom
Two Bedroom
Total/Average
Add: Other Income
Total Gross Scheduled Income (GSI)
(Less) Vacancy
Effective Gross Income (EGI)
II. Operating Expenses
(Less) Operating Expenses
(Less) Property Taxes (1)
(Less) Replacement Reserves
Total Expenses
Ill. Net Operating Income (NOi)
Unit Size
650 SF
850 SF
750 SF
#of
Units
7
z
14
APPENDIX II
MIXED-USE RENTAL
$/Month Annual
$2.90 $1,884 $158,235
$2.70 $2,300 $193,000
$2.79 $2,091 $351,235
$25 /Unit/Month $4,200
$355,435
5.0% ofGSI {$18,000)
$337,435
$4,600 /Unit/Year ($64,000)
$3,214 /Unit/Year ($45,000)
$250 /Unit/Year {$4,000)
$8,071 /Unit/Year ($113,000)
33.5% of EGI
$224,435
(1) Based on capitalized income approach; assumes a 1.0% tax rate and 5.0% cap rate.
Prepared by: Keyser Marston Associates, Inc.
Filename i: \Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag Page 73
TABLE A-14
NET OPERATING INCOME AND CAPITALIZED VALUE -RETAIL
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Gross Scheduled Income (GSI}
Total Retail GSI 3,000
(Less) Vacancy -Retail
Total Effective Gross Income
(Less) Unreimbursed Expenses -Retail
II. Net Operating Income (NOi)
Prepared by: Keyser Marston Associates, Inc.
Filename:Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
Rent/SF
$3.00 /SF/Month/NNN
10.0% of GSI -Retail
5.0% of EGI -Retail
APPENDIX II
MIXED-USE RENTAL
Total
Annual
$108,000
($10,800)
$97,200
($5,000)
$92,200
Page 74
TABLE A-15
FINANCING SURPLUS/(DEFICIT)
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Financing Surplus/(Deficit)
Net Operating Income -Residential
Net Operating Income -Retail
Total Net Operating Income
Capitalization Rate
Capitalized Value
(Less) Cost of Sale
(Less) Developer Profit
Net Sales Proceeds
(Less) Development Costs
II. Financing Surplus/(Deficit)
Prepared by: Keyser Marston Associates, Inc.
Filename: Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
3.0%
12.0%
$0 /Unit
APPENDIX II
MIXED-USE RENTAL
$224,435
$92,200
$316,635
5.5%
$5,757,000
($173,000)
($691,000)
$4,893,000
($4,893,000)
Page 75
B. AFFORDABLE VALUES
Affordable rent levels are a function of the income level for which the unit is aimed to be
affordable; the calculations are formula-based according to a combination of statute and policy,
both local and Statewide.
The Area Median Income is the starting point for the affordable rent calculation. The U.S.
Department of Housing and Urban Development (HUD) publishes the Area Median Income
(AMI) for each county annually. Appendix II -Table 8-1 presents the income limits for
households at 50% AMI and 80% AMI.
Affordable Rent Levels
The ca lculation of affordable rents at 50% and 80% AMI is presented in Appendix II -Table 8-2.
The calculation of affordable rents incorporates the following key assumptions:
1. Assignment of family size (number of persons) vs. unit size (number of bedrooms) based on
the number of persons exceeding the number_9f bedrooms by one.
2. Calculation of affordable rents based on the formulas shown in Exhibit 24.
Exhibit 24: Affordable Rent I.eve/ Calculations
Household Income
Very-low: 50% of AMI
Low: 80% of AMI
Affordable Rent Calculation
30% of 50% AM I
30% of 70% AM I
3. 50% and 70% income figures extrapolated from the figures shown in the Income Limits for
2015, published by the U.S. Department of Housing and Urban Development as of March,
2015.
4. Utility allowances as determined by the County of San Diego, assuming a common utility
profile for newer units.
Keyser Marston Associates, Inc.
16018ndh
11060.010.001
February 2016
Page 76
Based on the above assumptions, affordable rent levels for Very low-and Low-income
households are shown in Exhibit 25:
Exhibit 25: Affordable Rent Levels -Very Low-and Low-Income
Number of Bedrooms Very low-income Low-income
One $710 $1,085
Two $850 $1,215
Three $977 $1,342
The rent levels so defined (by unit size and income category) govern the maximum rent that a
building owner may charge for a particular unit.
Keyser Marston Associates, Inc.
16018ndh
11060.010.001
February 2016
Page 77
TABLE B-1
INCOME DEFINITIONS, 2015
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
Family Size 50%AMI
1 Person $28,350
2 Persons $32,400
3 Persons $36,450
4 Persons $40,500
5 Persons $43,750
80%AMI
$45,400
$51,850
$58,350
$64,800
$70,000
Source: U.S. Department of Housing and Urban Development (HUD), effective March 6, 2015.
Prepared by: Keyser Marston Associates, Inc.
Filename: i: Carlsbad_Nexus Study Update_Technical Analysis_vl;2/18/2016;rsp
APPENDIX II
Page 78
TABLE B-2
AFFORDABLE RENTS, 2015
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
APPENDIX II
GARDEN APARTMENTS
Affordable
I Number of Bedrooms One Two Three
I. Low Income Housing Tax Credits· 50% AMI
Percent of AMI
II.
Ill.
Family Size
Household Income (Rounded) (ll
Income Allocation to Housing
Monthly Housing Cost (2)
(Less) Utility Allowance (3)
Low Income Housing Tax Credits• 60% AMI
Percent of AMI
Family Size
Household Income (Rounded) (1)
Income Allocation to Housing
Monthly Housing Cost (2)
(Less) Utility Allowance (3)
Households earning u~ to 80% AMI
Percent of AMI (4)
Family Size
Household Income (Rounded)
Income Allocation to Housing
Monthly Housing Cost
(Less) Utility Allowance (3)
50.0%
1.5
$30,375
30%
$759
fi1fil
60.0%
1.5
$36,450
30%
$911
fi1fil
70.0%
2.0
$45,360
30%
$1,134
~
50.0% 50.0%
3.0 4.5
$36,450 $42,125
30% 30%
$911 $1,053
1illl filfil
60.0% 60.0%
3.0 4.5
$43,740 $50,550
30% 30%
$1,093 $1,263
1illl filfil
70.0% 70.0%
3.0 4.0
$51,030 $56,700
30% 30%
$1,276 $1,418
1illl filfil
{1) California Tax Credit Allocation Committee 2015 maximum income levels for projects placed in service on or after March 6, 2015.
(2) California Tax Credit Allocation Committee 2015 maximum rents for projects placed in service on or after March 6, 2015.
(3) Per the San Diego County Department of Housing and Community Development 2015 Utility Allowance Schedule, July 1, 2015.
Electric Heat
Gas Cooking
Gas Water Heater
Other Electric
Total Utilities
One Two Three
$9 $11 $14
$3 $3 $4
$10 $12 $15
ill lli ~
$49 $61 $76
(4) State of California Department of Housing and Community Development {HCD) 2015 income limits.
Prepared by: Keyser Marston Associates, Inc.
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C. AFFORDABILITY GAPS
The calculation of affordability gap for an affordable housing prototype development is
presented in Appendix II -Tables C-1 through C-4. The affordability gaps were calculated
assuming affordable housing in the City is provided in an garden apartment development at
two income levels: (1) all units affordable to Very low-income households (earning up to 50%
AMI); and (2) all units affordable to Low-income households (earning up to 80% AMI).
The Very low-income units are assumed to be financed with Low Income Housing Tax Credits
and tax-exempt bond financing. The Low-income units are assumed to be financed using
conventional debt and equity financing sources.
The resulting financing gap generated reflects of the difference between warranted investment
and development costs. In the nexus study, the affordability gap is the amount of subsidy
dollars required to bridge the difference between the two va lues.
Exhibit 26 provides a summary of the affordability gaps used in the analysis: ~
Exhibit 26: Affordability Gap Per Unit -Garden Apartments
Very-low income
$134,000
Keyser Marston Associates, Inc.
16018ndh
ll060.010.001
Low-income
$137,800
February 2016
Page 80
TABLE C-1
PROJECT DESCRIPTION -GARDEN APARTMENTS
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I. Site Area
II. Gross Building Area
Residential Area
Common Area
Total Gross Building Area (GBA)
Ill. Unit Mix
One Bedroom
Two Bedroom
Three Bedroom
Total
IV. Number of Stories
5.00 Acres
103,250 SF 95%
5,434 SF 5%
108,684 SF 100%
# of Units
25 Units 20%
62 Units 50%
38 Units 30%
125 Units 100%
3 Stories
APPENDIX II
GARDEN APARTMENTS
Affordable
Unit Size
550 SF
800 SF
1,050 SF
826 SF
V. Density 25.0 Units/Acre
VI. Construction Type
VII. Parking
Number of Spaces
One Bedroom
Two and Three Bedroom
Visitor
Total
Parking Type
Carport Spaces
Surface Spaces
Total
Prepared by: Keyser Marston Associates, Inc.
1.5 Spaces/Unit
2.0 Spaces/Unit
0.26 Spaces/Unit
1.0 Space/Unit
TypeV
38 Spaces
200 Spaces
32 Spaces
270 Spaces
125 Spaces
145 Spaces
270 Spaces
Filename i:\Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;Iag Page 81
APPENDIX II
TABLE C-2
GARDEN APARTMENTS
ESTIMATED DEVELOPMENT COSTS Affordable AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
50%AMI 80%AMI
Totals Per Unit Comments Totals Per Unit Comments
I. Acquisition Costs $7,623,000 $61,000 $35 Per SF Site $7,623,000 $61,000 $35 Per SF Site
II. Direct Costs (1)
Off-Site Improvements (2) $653,000 $5,200 $3 Per SF Site $653,000 $5,200 $3 Per SF Site
On-Sites/Landscaping $2,178,000 $17,400 $10 Per SF Site $2,178,000 $17,400 $10 Per SF Site
Parking -Carport $250,000 $2,000 $2,000 Per Space $250,000 $2,000 $2,000 Per Space
Shell Construction $13,586,000 $108,700 $125 Per SF GBA $13,586,000 $108,700 .$125 Per SF GBA
FF&E/ Amenities $200,000 $1,600 Allowance $200,000 $1,600 Allowance
Contingency $843,000 $6,700 5.0% of Directs $843,000 $6,700 5.0% of Directs
Total Direct Costs $17,710,000 $141,700 $163 Per SF GBA $17,710,000 $141,700 $163 Per SF GBA
Ill. Indirect Costs
Architecture & Engineering $1,063,000 $8,500 6.0% of Directs $1,063,000 $8,500 6.0% of Directs
Permits & Fees (3) $1,938,000 $15,500 $18 Per SF GBA $1,938,000 $15,500 $18 Per SF GBA
Legal & Accounting $177,000 $1,400 1.0% of Directs $177,000 $1,400 1.0% of Directs
Taxes & Insurance $266,000 $2,100 1.5% of Directs $266,000 $2,100 1.5% of Directs
Developer Fee $2,500,000 $20,000 14.1% of Directs $708,000 $5,700 4.0% of Directs
Marketing/Lease-Up $313,000 $2,500 Allowance $313,000 $2,500 Allowance
Contingency $188,000 $1,500 3.0% of Indirects $134,000 $1,100 3.0% of Indirects
Total Indirect Costs $6,445,000 $51,600 36.4% of Directs $4,599,000 $36,800 26.0% of Directs
IV. Financing Costs $2,657,000 $21,300 15.0% of Directs $2,214,000 $17,700 12.5% of Directs
V. Total Development Costs $34,435,000 $275,500 $317 Per SF GBA $32,146,000 $257,200 $296 Per SF GBA
(1) Does not assume payment of prevailing wages.
(2) KMA gross estimate. Not verified by KMA or the City.
(3) Per City.
Prepared by: Keyser Marston Associates, Inc.
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TABLE C-3
NET OPERATING INCOME
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
50%AMI
I. Gross Scheduled Income (GSI)
One Bedroom @ 50% AMI
One Bedroom @ 60% AMI
One Bedroom @ 80% AMI
Two Bedroom
Two Bedroom
Two Bedroom
Th ree Bedroom
Three Bedroom
Th ree Bedroom
Total/Average
Add: Other Income
@50%AMI
@60%AMI
@80%AMI
@50%AMI
@60%AMI
@80%AMI
Total Gross Scheduled Income (GSI)
(Less) Vacancy
Effective Gross Income (EGI)
II. Operating Expenses
(Less) Operating Expenses
(Less) Property Taxes
(Less) Replacement Reserves
Total Expenses
Ill. Net O eratin Income NOi
8
17
19
43
12
26
$/Month
$710
$862
$850
$1,032
$977
$1,187
125 $741
$1S /Unit/Month
5.0% of GSI
$5,000 /Unit/Year
$0 /Unit/Year
$250 /Unit/Year
$5,248 /Unit/Year
60.9% of EGI
(1) Assumes developer will partner with a non-profit organization.
(2) Based on capitalized income approach; assumes a 1.0% tax rate and 5.5% cap rate.
Prepared by: Keyser Marston Associates, Inc.
Filename i: \Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
$68,200
$175,800
$193,800
$532,500
$140,700
$370,300
$1,111,000
$22,500
$1,133,500
($56.700)
$1,076,800
($625,000)
$0 (1)
($31,000)
($656,000)
$421,000
80%AMI
$/Month
25 $1,085
62 $1,215
38 $1,342
125 $1,227
$15 /Unit/Month
5.0% of GSI
$5,000 /Unit/Year
$1,368 /Unit/Year
$250 /Unit/Year
$6,616 /Unit/Year
46.7% of EGI
APPENDIX II
GARDEN APARTMENTS
Affordable
$325,500
$903,800
$611,700
$1,841,000
$22,500
$1,863,500
($93,200)
$1,770,300
($625,000)
($171,000) (2)
($31.000)
($827,000)
$943 000
Page 83
TABLE C-4
FINANCING SURPLUS/(DEFICIT)
AFFORDABLE HOUSING IMPACT FEE NEXUS STUDY
CITY OF CARLSBAD
I
I. Sources of Funds
Permanent Loan
Market Value of Tax Credits
Deferred Developer Fee
Tot al Sources of Fu nds
II. (Less) Development Costs
Ill. Financing Surplus/(Deficit)
Per Unit
Prepared by: Keyser Marston Associates, Inc.
50%AMI
$6,045,000
$11,094,000
$500,000
$17,639,000
($34,435,000)
($16,796,000)
($134,000)
Filename: Carlsbad_Nexus Study Update_Technical Analysis_v1;2/18/2016;1ag
80%AMI
I. Capitalized Value
Net Operating Income
Capitalization Rate
Capitalized Value
II. (Less) Development Costs
(Less) Cost of Sale
(Less) Developer Profit
Net Sales Proceeds
3.0%
10.0%
APPENDIX II
GARDEN APARTMENTS
Affordable
$943,000
5.5%
$17,145,000
($32,146,000)
($514,000)
($1,715,000)
($34,375,000)
($17,230,000)
($137,800)
Page 84