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HomeMy WebLinkAboutAgenda Packet - CC - 2023.06.14 Special MeetingCITY v 0 ticow � � rPORATED Wednesday, June 14, 2023 City of Burlingame Meeting Agenda - Final City Council BURLINGAME CITY HALL 501 PRIMROSE ROAD BURLINGAME, CA 94010 6:30 PM Burlingame Community Center - Maple Room & Online Annual Joint Meeting of the City Council and Planning Commission Consistent with Government Code Section 54953, this Joint Meeting of the City Council and Planning Commission will be held via Zoom in addition to in person. To maximize public safety while still maintaining transparency and public access, members of the public can observe the meeting from home or attend the meeting in person. Below is information on how the public may observe and participate in the meeting. To Attend the Meeting in Person: Location: Burlingame Community Center - Maple Room 850 Burlingame Avenue, Burlingame, California 94010 To Observe the Meeting via Zoom: To access the meeting by computer. Go to www.zoom.us/join Meeting ID: 828 3799 3865 Passcode:976968 To access the meeting by phone: Dial 1-346-248-7799 Meeting ID: 828 3799 3865 Passcode:976968 To Provide Public Comment in Person: Members of the public wishing to speak will be asked to fill out a "Request to Speak" card located on the table by the door and then hand it to staff. The provision of a name, address, or other identifying information is optional. Speakers are limited to three minutes each, however, the Mayor may adjust the time limit in light of the number of anticipated speakers. To Provide Public Comment via Zoom: During the meeting, public comment may be made by members of the public joining the meeting via Zoom. Zoom access information is provided above. Use the 'Raise Hand" feature (for those joining by phone, press "9" to 'Raise Hand) during the public comment period for the agenda item you wish to address. The Zoom Host will call on people to speak by name provided or last 4 digits of phone number for dial -in attendees. Speakers are limited to three minutes each, however, the Mayor may adjust the time limit in light of the number of anticipated speakers. City of Burlingame Page 1 Printed on 611212023 City Council Meeting Agenda - Final June 14, 2023 To Provide Public Comment via Email: Emailed comments should include the specific agenda item on which you are commenting, or note that your comment concerns an item that is not on the agenda. The length of the comment should be commensurate with the three minutes customarily allowed for verbal comments, which is approximately 250-300 words. To ensure that your comment is received and read to the City Council and Planning Commission for the appropriate agenda item, please submit your email no later than 5:00 p.m. on June 14, 2023. The City will make every effort to read emails received after that time, but cannot guarantee such emails will be read into the record. Any emails received after the 5:00 p.m. deadline which are not read into the record, will be provided to the City Council and Planning Commission after the meeting. 1. CALL TO ORDER - 6:30 p.m. - Burlingame Community Center - Maple Room/Online 2. ROLL CALL 3. REQUEST FOR AB 2249 REMOTE PARTICIPATION Announcements/consideration and approval of requests by Councilmembers and Planning Commissioners to participate remotely pursuant to AB 2449 (Government Code SEction 54943(0) 4. DISCLOSURE OF SB 1439 CONFLICTS (Government Code Section 84308) 5. MEETING OVERVIEW (Kevin Gardiner, Community Development Director) 6. PUBLIC COMMENTS, NON -AGENDA Members of the public may speak about any item not on the agenda. Members of the public wishing to suggest an item for a future Council or Planning Commission agenda may do so during this public comment period. The Ralph M. Brown Act (the State local agency open meeting law) prohibits the City Council and Planning Commission from acting on any matter that is not on the agenda. 7. DISCUSSION TOPICS a. Broadwav Specific Plan Overview (45 minutes Attachments: Staff Report b. HOPE Community Advisory Committee Report (45 minutes) Attachments: Staff Report HOPE CAC Report FAQ C. General Plan Buildout Evaluation (15 minutes) 8. ADJOURNMENT - 8:30 p.m. City of Burlingame Page 2 Printed on 6/12/2023 City Council Meeting Agenda - Final June 14, 2023 Notice: Any attendees who require assistance, a disability related modification, or language assistance in order to participate in the meeting should contact Meaghan Hassel -Shearer, City Clerk by 10:00 a.m. on Wednesday, June 14, 2023 at (650) 558-7203 or at mhasselshearer@burlingame.org. Any individual who wishes to request an alternate format for the agenda, meeting notice, or other writings that are distributed at the meeting should contact Meaghan Hassel -Shearer, City Clerk by 10:00 a.m. on Wednesday, June 14, 2023 at (650) 558-7203 or at mhasselshearer@burlingame.org. Notification in advance of the meeting will enable the City to make reasonable arrangements to ensure accessibility to the meeting, the materials related to it, and your ability to comment. NEXT CITY COUNCIL MEETING Regular City Council Meeting on Tuesday, June 20, 2023 at 7:00 p.m. VIEW REGULAR COUNCIL MEETING www.burlingame.org/video NEXT PLANNING COMMISSION MEETING Regular Planning Commission Meeting on Monday, June 26, 2023 at 7:00 p.m. Any writings or documents provided to a majority of the City Council/Planning Commission regarding any item on this agenda will be made available for public inspection via www.burlingame.org or by emailing the City Clerk at mhasselshearer@burlingame.org. If you are unable to obtain information via the City's website or through email, contact the City Clerk at (650) 558-7203. City of Burlingame Page 3 Printed on 6/12/2023 BURLINGAME STAFF REPORT AGENDA NO: 7a _11 MEETING DATE: June 14, 2023 To: Honorable Mayor, City Council, and Planning Commission Date: June 14, 2023 From: Kevin Gardiner, Community Development Director — (650) 558-7253 Joseph Sanfilippo, Economic Development & Housing Specialist — (650) 558-7264 Subject: Broadway Specific Plan Overview Broadway is one of two primary commercial destinations in the city and is known for its distinct, small-town main street character. The surrounding residential neighborhoods support these businesses with foot traffic. And although Broadway is a primary connection for vehicles traveling between Highway 101 and El Camino Real, the roadway's narrow width and tree canopy work to maintain lower traffic speeds that support the pedestrian environment. Broadway's charm is in its scale, focus on an active street front, and mixture of neighborhood and community -serving rather than regional -serving businesses. The Envision Burlingame General Plan calls for Broadway to maintain its character as a vibrant, pedestrian -friendly, mixed -use district that supports and encourages local businesses and local investment, and that serves as a gathering place for Burlingame residents and a quaint destination for visitors (Goal CC-7). Furthermore, the General Plan prioritizes the creation of a specific plan for Broadway (Implementation Program IP-3). The specific plan will address issues and opportunities presented by the restoration of full service of Caltrain at the Broadway station, as well as the proposed grade separation project for the existing at -grade railroad crossing. Both of these initiatives promise to have implications on land use and circulation in the neighborhood. While the Burlingame General Plan addresses the Broadway corridor in terms of goals and policies, the specific plan will take the next step by articulating the vision. In order for Broadway to become a functional transit -oriented neighborhood, the specific plan would not only focus on land use and development standards, but also economic development. For Broadway to be successful, it needs to be economically viable, with businesses that are responsive to the needs of a local resident population. Given the changes in retail commerce (both prior to the pandemic and since), there is interest in determining what type of commercial uses can be viable in a neighborhood -serving district such as Broadway. There is also a need to create a district -wide parking strategy. While there are existing city -owned parking lots in the commercial district, unlike Downtown there is not a parking district or other Broadway Specific Plan June 14, 2023 mechanism that would relieve projects from providing on -site parking. This has inhibited transit - oriented infill development, as many properties are too small to accommodate parking on site. The objective is to develop a specific plan that can poise Broadway to become an economically -viable transit -oriented neighborhood, with policies and standards that can accommodate additional housing and sustainable, infill development. Figure 1 below illustrates the proposed boundaries of the specific plan. The plan would encompass the Broadway commercial corridor, as well as one residential block to the north and south. FIGURE 1 PROPOSED BROADWAY SPECIFIC PLAN BOUNDARIES &S , '�V 40 �0� �a ^ 6r x� .�4 �� @440 I&— �r4, e - *4 2 Broadway Specific Plan June 14, 2023 The specific plan process will include a range of community input opportunities, including workshops, stakeholder meetings, and a Community Advisory Committee (CAC). CAC members will be a representative group of residents (to the extent possible, both renters and homeowners), employees of local businesses, community -based organizations, social service providers, members of the Broadway BID and Chamber of Commerce, and other involved community members in the plan area and in surrounding neighborhoods. The CAC will also include liasons from the Planning Commission, Traffic Safety & Parking Commission, and Parks & Recreation Commission. The committee will act in an advisory capacity to City staff, consultants, and the Planning Commission and the City Council as the project moves forward, reviewing the draft plan materials and serving as conduits to their respective organizations. The specific plan is being funded primarily through an Association of Bay Area Governments/Metropolitan Transportation Commission (ABAG/MTC) planning grant. ABAG/MTC in coordination with the City of Burlingame issued a Request for Proposals (RFP) in 2022. A consultant team led by MIG planning consultants was selected to prepare the specific plan. The MIG team includes specialists in planning, urban design, economic development, transportation, parking, and historic resources. MIG previously prepared the General Plan Update and Zoning Code Update, and is very familiar with Burlingame and Broadway. The MIG team is currently assembling an evaluation of existing conditions, and the Joint City Council/Planning Commission meeting is the first community engagement in the process. For the joint meeting, representatives from the MIG team will make a presentation providing an overview of the specific plan process, and be available for questions. Councilmembers and commissioners will be asked to provide suggestions for community outreach activities, including the composition of the CAC. There will also be an opportunity to comment on objectives for the specific plan. 3 BUR— IN�AAGENDA NO: STAFF REPORT MEETING DATE: June 14, 2023 To: Honorable Mayor, City Council, and Planning Commission Date: June 14, 2023 From: Kevin Gardiner, Community Development Director — (650) 558-7253 Joseph Sanfilippo, Economic Development & Housing Specialist — (650) 558- 7264 Subject: Consideration of Housing Fund Subcommittee Report BACKGROUND The Housing, Opportunity, Priorities and Education (HOPE) Community Advisory Committee was created to help prioritize investments in affordable housing that use funds collected from fees on new development. The primary intent of the housing funds is to create homes for workers in Burlingame whose wages cannot cover market rate rents or home prices, including: • People who work in Burlingame now and have to commute in from a location with a lower cost of living; • People who live in Burlingame now and are precariously housed due to high cost of rents compared to their wages; and • People who lived or worked in Burlingame previously, and would like to return if they could find housing that they could afford. The HOPE committee was formed at the suggestion of the City Council Affordable Housing Fund Ad Hoc Subcommittee with the intent to direct policies and programs for use of commercial linkage fees and residential impact fees that have been collected from new development projects (the "Affordable Housing Fund"). Mayor Brownrigg and Vice Mayor Colson comprise the Subcommittee. Given the large sums and the many possible uses of the funds, the Subcommittee indicated interest in forming an advisory committee to discuss the use and prioritization of housing funds. Formation of the HOPE committee was supported by the full City Council. The HOPE Committee, which was comprised of community volunteers from a wide range of backgrounds, met four times from January to May 2023. Susan Clark of Common Knowledge, who also facilitated the "Burlingame Talks Together About Housing" series in 2018, facilitated the HOPE Committee meetings, with technical support provided by Sandy Council of Good City Company. A summary of the committee's work and its findings is attached. A Frequently Asked Questions (FAQ) was also prepared for the committee, and is also attached. 1 HOPE Committee June 14, 2023 DISCUSSION Affordable housing impact fees are used to support and build new homes for lower -income residents. The fees can be charged to developers of new residential projects and used for land purchase, construction costs, or site rehabilitation related to providing workforce housing. On June 19, 2017, the City Council adopted an ordinance establishing commercial linkage fees for new commercial development in Burlingame, and on April 1, 2019, it adopted residential impact fees for new residential development in Burlingame. Over time, these fees will provide a dedicated source of funding for programs supporting workforce housing in Burlingame. For new commercial development, the adopted linkage fees are $7.00 per square foot for new retail development, $12.00 per square foot for new hotel development, $18.00 per square foot for office projects of 50,000 square feet or less, and $25.00 per square foot for office greater than 50,000 square feet. For developers who utilize prevailing wages or area standard wages, the fees are $5.00 per square foot for new retail development, $10.00 per square foot for new hotel development, $15.00 per square foot for office of 50,000 square feet or less, and $20.00 per square foot for office greater than 50,000 square feet. For new residential development, the adopted residential impact fees vary from $14.00 to $45.00 per square foot, depending on residential density (units per acre) and whether the project is rental or for sale. There is also an "in -lieu" option where the developer can choose to provide an affordable unit or units on site in lieu of submitting the impact fee: • For Rental Multifamily projects, at least ten percent (10%) of the units on site must be affordable to moderate income households (in this instance 80% - 120% AMI) for a period of 55 years in order to waive the residential impact fee. • For Sale Multifamily (Townhome/Condominium) projects, ten percent (10%) of the units on site must be affordable to above -moderate income households (in this instance 120% - 150% AMI, with the price set at the 135% AMI level) for a period of 55 years in order to waive the residential impact fee. Staff has been working with Seifel Consultants to evaluate the residential impact fees and in -lieu program. The study will be completed by the end of this summer. Fund Balance and Protections: The Affordable Housing Fund currently has a net balance of approximately $7,200,000, resulting from commercial linkage fees collected from the 250 California Drive, 220 Park Road (former Post Office), and 567 Airport Boulevard development projects. (Technically the balance is approximately $8,700,000, but $1,432,000 has been allocated to the Eucalyptus Grove affordable housing development at 1875 California Drive.) There are a number of development projects in various stages of review that will contribute additional fees. Fees are collected prior to the issuance of the building permit for the project. The table below indicates projects subject to commercial linkage fees that are currently approved or under review. Because collection of fees is linked to building permit issuance, it can be difficult to anticipate the timing of receiving fees, but estimates are provided in the table based on current project status and typical permitting timelines: 2 HOPE Committee June 14, 2023 TABLE 1: PROPOSED PROJECTS SUBJECT TO COMMERCIAL LINKAGE FEES JUNE 2023 Project Application Square Feet Linkage Fee Potential Building Permit Issuance/Collection of Fees Base With Prevailing / Area Wage Top Golf — approved Restaurant/Retail Entertainment 71,074 $355,370' $355,370 2023 1699 Bayshore Highway & 810 Malcom Road — under construction Office/R&D 1431,000 $ 11,342,250 $8,620,000 2023 777 Airport Boulevard — approved Office/R&D 403,425 $10,085,000 $9,073,800 2023 620 Airport Boulevard — under review Office/R&D 1481,660 $9,370,369 $7,465,855 2024 1200-1340 Ba shore Highway — under review Office/R&D 11,420,000 $31,045,200 $24,836,190 20242 1499 Ba shore Highway — under review Office/R&D 304,354 $6,023,325 $4,821,860 2025 Total $68,221,514 $55,173,075 Based on experience with large commercial projects currently under construction, staff anticipates that most if not all of the above projects will utilize prevailing/area wages. This is due to the scale and complexity of the construction, and the necessary labor expertise. Therefore, staff suggests that the figure of $55,173,075 is more likely provided all projects are approved and advance to construction. To date, all residential projects subject to residential impact fees have utilized the on -site in -lieu option. However, at least one developer has indicated they typically pay fees rather than build the affordable units on site. Such fees would be above and beyond those projected from commercial projects. HOPE Committee Meetin_p Materials: Each HOPE meeting included a detailed slide presentation providing information on potential uses of housing funds, financing of affordable housing, regulatory programs such as State Density Bonus, and determining priorities. Presentation slides may be found at www.burlingame.org/HOPE. The web page also includes the FAQ attached to this staff report, as well as earlier meeting summaries. ' Prevailing/Area Wage to be used per agreement. A portion of the fees noted here will offset other community benefits as negotiated in the term sheet adopted previously by Council. 2 Timing of Housing Fund payments may be phased over several years depending on structure of Development Agreement. VJ HOPE Committee June 14, 2023 NEXT STEPS The Joint City Council/Planning Commission meeting will include a presentation summarizing the HOPE Committee's work and findings. Councilmembers and Commissioners will have the opportunity to ask questions and provide feedback. On June 20, 2023, there will be a follow-up item at the regular City Council meeting. Councilmembers will continue the discussion, and be asked to provide preliminary direction for next steps towards implementation. Depending on Council direction and the nature of the uses of funds, HOPE Committee members may be invited to reconvene on an ad -hoc basis to provide input on specific housing initiatives. Attachments: • HOPE Community Advisory Committee Members' Input to Burlingame City Council • Frequently Asked Questions (FAQ) C HOPE Community Advisory Committee Members' Input to Burlingame City Council June 9, 2023 The City of Burlingame convened a Community Advisory Committee (CAC), known as the "Housing Opportunity, Priorities, and Education (HOPE)" committee, to help the Burlingame City Council shape guidelines for the disbursement of the City's housing funds. The Council Affordable Housing Fund Ad Hoc Subcommittee, comprised of Mayor Michael Brownrigg and Vice Mayor Donna Colson, identified community members representing a range of experiences and relationships with different parts of the Burlingame community. Over a dozen community members participated in some part of the HOPE committee's proceedings. Nine CAC members have chosen to be part of an ongoing discussion with staff and the Council Subcommittee. The following report shares highlights from the Committee's four public meetings. BACKGROUND: THE OPPORTUNITY & CONTEXT The City's affordable housing funds are generated by commercial linkage fees, which are a non -recurring source of revenue, tied to what commercial development projects get approved and built. These funds complement other ways that affordable housing can be provided in Burlingame for people who have incomes below the Area Median Income (AMI) — such as affordable units built as part of market rate residential developments in lieu of impact fees or "naturally occurring affordable housing" from landlords who charge rents below market rate. Another current example of a way to stimulate affordable housing is the Village at Burlingame where the City donated land to a development instead of direct financial support. The City of Burlingame recently completed its first draft Housing Element for the 2023-2031 cycle. Providing access to homes for people with very low and extremely low income was identified as a priority. During the HOPE CAC discussions and with support from industry experts, it has been clarified that the housing funds generated by commercial linkage fees need to have a use that relates to providing housing for Burlingame's workforce, based on the premise that commercial development generates new jobs and, by extension, increased housing demand. Therefore, the Committee referred these funds as funds affordable workforce housing to be clear about intent. Burlingame HOPE Community Advisory Committee Report June 2023 HOPE COMMUNITY ADVISORY COMMITTEE INPUT Committee members were invited in to join the HOPE Community Advisory Committee in January 2023. The first two meetings were conducted on Zoom (January 25 and February 15) and the third and fourth meetings were in person on March 29 and April 12 at the Burlingame Community Center. The HOPE CAC has a webpage and Q&A resources (www.burlingame.org/HOPE). While the group was not charged with reaching consensus, many interests and perspectives overlapped through the four meetings. 1 — CLARIFYING PURPOSE — The Who and Why Committee members were presented with the demographics of who lives and works in Burlingame, as well as information about pay rates for different types of jobs compared to Adjusted Area Median Income (AMI). Affordable housing policy and financing uses the nomenclature of Extremely Low Income (ELI), Very Low income (VL), Low and Moderate. Across the Committee, there was broad confirmation of a deep-seated interest in helping Burlingame both retain and increase socio-economic and occupational diversity. Multiple voices explicitly stated respect for the value and dignity of all professions, independent of pay scale. When asked whether they wanted to prioritize housing opportunities for ELI, VL, Low or Moderate income, a majority of Committee members expressed an interest in wanting to help all of those categories. Some were particularly dedicated to helping extremely low and very low-income households because they need the most assistance. A few others specifically indicated that they wanted to include housing opportunities for people earning closer to the median income because they see a "missing middle" in terms of housing supply. Burlingame HOPE Community Advisory Committee Report June 2023 Several of the meetings included discussion of specific types of households and work categories that could be supported. Examples of what was shared: - People making less than $50,000 (<50% of Area Median Income (AMI)) - Households making 60-80% of AMI (income range for professions such as teachers, public service employees, etc.) - Low-income families (single head of household as well as other family configurations) — a recurring theme was to provide children with a stable home with access to good schools and expanded opportunities - Essential workers making minimum wage — e.g., caregivers; early childhood educators - Employees that sustain small businesses — retail, restaurants - Low -wage workers for larger employers, such as housekeepers at hotels, to reduce long commutes By the fourth CAC meeting, after several specific types of potential residents were discussed, a majority of the Committee landed on a broad priority category of "people who work in Burlingame" as long as they met the income criteria. Some specifically called out public employees as a first priority, but most preferred a less restrictive criteria screen since the need for workforce housing crosses all sectors of employment. For a given set of affordable homes that would be offered, some suggested an eligibility hierarchy of: - People who work in Burlingame - People who live in Burlingame - People who work in San Mateo County - People who live in San Mateo County The above were discussed as criteria for eligibility to be offered and move into an affordable home. After that, Committee members did not want residents to have to move out if they got a raise, got married or increased their income in other ways. Several on the HOPE CAC articulated different approaches to give people a chance to improve their opportunities. For example, if household income increased, hold rent stable to enable savings to add to education tuition and/or build a nest egg for future home ownership. Another way the Committee thought through the "who" for these affordable housing funds was to discuss the "why" of how Burlingame as a community will benefit. Across the four meetings CAC members identified these important benefits from providing more accessible housing for the priority groups: - Community diversity - Social and economic diversity - Inclusion - Sustaining the labor pool that sustains small businesses and/or local businesses - Greater responsiveness and stability in public services - Burlingame can continue to be a model for pro -housing practices - Providing current/new residents with low income more access to quality schools and pathways to success - Reducing long commutes and associated negative impacts on the environment and also on social/emotional well-being Burlingame HOPE Community Advisory Committee Report June 2023 2 - BALANCING PRIORITIES - The What: Preferred Possibilities Many approaches were considered about how to achieve community value from these funds for affordable workforce housing. During the committee meetings, staff and members shared examples that clustered into these basic categories: Contributing to Building of new housing - Multi -unit, 100% affordable - Multi -unit, mixed rate developments - ADUs on Single Family Properties if able to be Deed Restricted for low income workers Buying existing multi -unit housing Leveraging/partnering with other resources and funds, especially including publicly owned land. Any given project will have a lot of technical details and unknowns. During the Committee's discussions, participants acknowledged that they knew they were not recommending any specific project or scenario, but instead creating considerations and guidelines as future opportunities for affordable housing for workers are pursued and/or are presented to the City. While considering different options, the entire Committee indicated interest in a mix of possibilities, balancing projects the City could actively pursue and complete more quickly, as well as those which would require more collaboration with a longer time frame. Two types of scenarios generated the greatest interest among the CAC members: - Purchasing existing multi -unit housing in Burlingame to be able to preserve low rents and/or reduce rents - Developing City -owned land or land owned by other public agencies (e.g., possibly the school district or health care district) CAC members noted that the City purchasing existing multi -family housing would likely provide fewer units at a higher cost per unit, as opposed to a gap financing scenario where the City contributes funding to a project led by an outside developer. Some in the group envisioned an additional longer -term outcome from the City purchasing existing housing: once the City owned the land, it could redevelop it into more units overall. And it was again acknowledged that everything would be on a case -by -case basis as specific opportunities are identified. The second of the two preferred scenarios, developing multi -unit housing on public land, was a high priority for the Committee because of how it could take advantage of underutilized resources and possibly allow the City to have more control over the levels of income provided in the development. It should be noted that the Committee did not engage in any discussion of specific parcels owned by other public agencies that might be available for collaboration. That is an example of a future discussion for the Council Housing Fund Subcommittee. Of additional interest to the CAC members were scenarios of working with developers to create 100% percent affordable housing developments, or affordable housing in a mixed rate development. The housing funds generated from Burlingame's commercial linkage fees have already contributed to one of these types of projects, Eucalyptus Grove Apartments, which presented a very favorable "gap financing" way for the City to leverage $1.43 million to achieve 69 very low-income (VLI) and extremely low-income (ELI) units. During the discussions, it seemed that CAC members were better able to visualize the Burlingame HOPE Community Advisory Committee Report June 2023 4 scenarios where the City was in a leadership role as a purchaser or collaborator on development. There were many more unknowns about the wide variety of rules, regulations, pools of layered financing and developer incentives that could come together to make a developer -led promising project. Yet, if another favorable gap financing opportunity appeared, it could likely meet the group's criteria. There was also thoughtful discussion about subsidizing building of ADUs by single-family homeowners. Many on the Committee expressed concern about spending public funds to subsidize private gain (i.e., subsidizing ADUs for homeowners who are in a high enough income bracket that they would be able to afford to build one anyway). Yet during the conversation about this possible option, a few members were interested in pursuing this to determine interest in a scenario where a homeowner on a constraining fixed income could receive financing to build an ADU on their property if the owner would move into it themselves, and then rent the larger main home to a low-income family. In multiple meetings, some CAC members spoke to the idea of using the affordable housing funds to support homeownership. They liked the idea of helping low and middle income households build equity. Other CAC members indicated that they thought that other funds, rather than the commercial linkage housing fees, would be better for that goal. The committee found more common ground on the approach mentioned above of not raising rents as income increases so that people could build savings. One idea was to help people "bank" part of their rent in an account dedicated toward a future Burlingame home. 3 - SHAPING PROCESS - The How of Creating/Responding to Priorities As noted, the dynamic nature of these housing funds is such that the Community Advisory Committee understood that they were not in a position to define specific housing projects but instead had been asked to provide criteria for how to evaluate opportunities as they arise. In addition to guidance on the "who, why and what", across the four meetings, the following types of "how" criteria have emerged for the City Council, subcommittee and staff to take into consideration for these housing funds: - Agile/responsive to changing market conditions and government policies Burlingame HOPE Community Advisory Committee Report June 2023 Attend to Cost/Unit and the total number of new homes that can be created, supporting the City's housing goals Amount of leverage, and what kind of "good deal for the money" the City can arrange Temper focus on cost per unit with attention to whether the City is gaining a long-term asset with future development possibilities Regarding timing, many CAC members urged the City to begin utilizing funds as soon as possible because the need is great. At the same time, there was discussion that speed should not lead to overpaying if market conditions are not yet right. Some committee members expressed interest in a possibility of using other City funds as an advance loan (for future commercial linkage fees not yet realized) if the right project presents itself. Several spoke to different ways that the City could proactively explore possibilities rather than waiting for project opportunities to arise. Regarding implementation, the HOPE Community Advisory Committee did not envision the City acting as a landlord in any scenario. If a property was purchased, there was Committee discussion about how the City of Burlingame should engage a competent cost-effective entity to manage the property. CAC members were particularly attentive to who might be displaced and urged the City to be extremely thoughtful about how people are asked to move to make new housing available. At the end of the fourth meeting on April 12, many CAC members shared their gratitude for being invited to participate in this Committee and how much they learned through the process as they grappled with potential trade-offs. In turn, Council Affordable Housing Fund Ad Hoc Subcommittee members Brownrigg and Colson expressed their gratitude to the group and what was gained through the successive discussions. As future decisions arise, the Council Affordable Housing Fund Ad Hoc Subcommittee indicated that it may contact HOPE CAC members for additional guidance and that Committee members will be invited to milestone events for Burlingame housing. Burlingame HOPE Community Advisory Committee Report June 2023 6 HOPE Community Advisory Committee Members: Many of these committee members have multiple affiliations. What is shown is for identification purposes. CAC members were invited to serve based on their care for the community and low-income workers in Burlingame. Rhovy Lyn Antonio & Angelina Soldatos, California Apartment Association Susan Baker, resident and SFO/Burlingame Chamber of Commerce Elizabeth Barnard, resident and Housing for All Burlingame Cathy Baylock, resident and former Councilmember Tish Busselle, St. Paul's Episcopal Church Burlingame and Samaritan House Board Member Heather Cleary, Peninsula Family Services Dave Hopkins, resident and Sares Regis Athan Rebelos, resident and Traffic, Safety and Parking Commissioner Walker Shores, newer resident and newly appointed Planning Commissioner Burlingame City Council Subcommittee: Mayor Michael Brownrigg Vice Mayor Donna Colson City staff Kevin Gardiner, Community Development Director Joseph Sanfilippo, Economic Development & Housing Specialist Consultant support: Affordable Housing Programs Consultant: Sandy Council, Good City Company Meeting Process Design & Facilitation: Susan Stuart Clark, Common Knowledge Burlingame HOPE Community Advisory Committee Report June 2023 7 An Overview of Burlingame's Housing Trust Funds for the HOPE Community Advisory Committee February 8, 2023 1. What is the purpose of the Housing, Opportunity, Priorities and Education (HOPE) Community Advisory Committee? The purpose of the HOPE committee is to help prioritize investments in affordable housing that use funds collected from fees on commercial development (aka the "Housing Fund"). 2. Where did these new funds come from? How much money is it? Fees are assessed on new commercial development. The fees vary depending on the type of commercial development (office, retail, hotel, etc.). The Current balance is $7.3 million. It could grow to $62+million by 2025 if all projects currently under review are built. These are one-time funds and are not a regular stream of income. 3. What are these funds intended to be used for? The primary intent is to create homes that are for workers in Burlingame whose wages cannot cover market rate rents or home prices. Some examples (not necessarily exhaustive): • People who work here now and have to commute in from a location with a lower cost of living • People who live here now and are precariously housed due to high cost of rents compared to their wages • People who lived or worked in Burlingame previously 4. Have any of the funds been allocated so far? Yes. The City has provided funds towards a project called Eucalyptus Grove Apartments that will have 69 units that will be affordable to households at 50% of Area Median Income 1 (AMI) or less. The City is investing approximately $1.5M to allow the project to be fully - funded (an example of "gap financing"). This is about $21,739 contributed by the City per unit. 5. How is "affordable" defined? What types of affordability will the CAC consider? The County of San Mateo established rates for Average Median Income (AMI). These rates change each year based on the incomes in the county. In 2022 the AMIs for San Mateo County were: • $116,200 household of 1 • $123,800 household of 2 • $149,400 household of 3 • $166,000 household of 4 Housing that would be affordable at the AMI would be classified as "100% AMI' and would be included in the "Moderate Income" category. The Moderate Income category spans from 80% AMI to 120% AMI. Housing that is above the 120% AMI level is termed 'Above Moderate" and can also be termed "Market Rate." More specifically, the term "Market Rate" refers to units that are not deed -restricted in terms of setting rent levels or sales prices, so are therefore priced at what the market can bear. Discussion of income levels can seem abstract when referencing the various percentages of AMI. To provide better understanding, attached to this document is a table providing occupation salary examples for a single wage earner. Some examples: • Hotel Housekeeper - $30,000 (in the range of the Extremely Low Income/30% AMI category) • Office Assistant - $62,000 (in the range of the Very Low Income/50% AMI category) • Police Officer - $107,000 (in the range of the Median Income/100% AMI category) • Finance Services Manager - $136,000 (in the range of the Moderate Income/120% AMI category) 6. What are the levels of affordability in projects currently under construction or approved in Burlingame? There are currently 2,412 units either under construction, approved (but not yet issued building permits), or under review in Burlingame. Together, these are referred to as the "pipeline" as they indicate the units that could be completed in coming years. 2 For the upcoming Housing Element, the City is obligated to provide sufficient zoning capacity for 3,257 units at a range of income levels. The table below indicates the Housing Element allocation, the units in the "pipeline," and the unmet need per the Housing Element allocations: Income Level Housing OE� mim Very Low Income (50% AMI) Element 863 Pipeline" Unmet I 147 Nee 716 Low Income (60% AMI) 497 188 309 Moderate Income (80% AMI) 529 72 457 Above Moderate Income (120% AMI) 1,368 2005 - 637 7. What makes it difficult to have more affordable housing for current workers in occupations with wages below the San Mateo County/Silicon Valley Region averages? Both rents and sales prices of homes on the Peninsula and in California have risen significantly faster than incomes. While the City of Burlingame's policies can help encourage the supply of more affordable housing, the City does not currently build housing or serve as a landlord for residential buildings (though this can be explored, similar to the partnership in building the Village at Burlingame). What types of housing are available are determined by private investments and/or non-profit organizations. Developers of residential properties need to cover their costs and most also need to make a profit to stay in business. The cost to build a new unit of housing with prevailing material costs and wages can be three or four times as expensive as what a person with very low income can spend on rent or a mortgage. That is a big disparity. Plus, the cost of a down payment for purchase is out of reach for many households. Home purchases have become increasingly unaffordable for larger percentages of the population, compared to decades past. The Burlingame housing funds present an opportunity to provide more homes that are below market rate. 3 B. How can these funds be used? The intent of the funds is to provide housing to serve increased demand from new commercial development. Funds may be used for either new construction or existing structures, or a mix of both. If funds are used for existing structures, it would likely be for multi -family buildings. However, it is also possible to create incentives for single family homeowners to build Accessory Dwelling Units (ADUs) with below market rents, provided those ADUs are deed - restricted at affordable rents for a specified period of time). As potential examples for types of investments, the City could use the funds: • As a co -investor with other partners — aka providing 'gap" on financing new construction (such as Eucalyptus Grove Apartments). • As a purchaser of a existing housing that some other entity would likely manage) • As a purchaser of land • To increase the share of affordable units in new developments (e.g. subsidizing units to increase the number of affordable units in a project, or similar financing mechanisms) • To provide incentives for existing properties to provide below market rents 9. What kinds of considerations and trade-offs will this committee be exploring? Each potential use of funds has benefits and shortcomings. The committee will be exploring these as it develops recommendations for the prioritization of funds. These may include: • Which kinds of use of funds/incentives will attract willing partners (e.g., among developers, current property owners and other kinds of collaborators)? • What are examples of innovative/effective/sustained affordable housing from other communities? • How many new homes can be supported at what level of affordability? • What level of income does the City hope to target? Particular sectors can also be targeted (people with developmental disabilities, public sector workforce, etc.) • Do these new homes also provide services/amenities for the residents? For the community? 51 San Mateo County Area Median Incomes (AMI) May 2022 Occupation Salary Examples Single Wage Earner 1 Person HH 2 Person HH 3 Person HH $39,150 Bank Teller (38K)* Medical Reception (38K)* Hotel Housekeeper (30K)* $44, 750 Janitorial Supervisor (42K)* Hotel Clerk (40K)* Phlebotomist (44K)* $50,350 Bookkeeper (50K)* Retail Mgr. (50K)* Case Worker (49K)* $63,250 Library Assist I (63K) Office Assist I (62K) Rec Coordinator I (62K) $74,600 Acct Assist II (71 K) Parking Enforce Officer (70K) Police Clerk II (71 K) $83, 900 Elem Teacher (80K) Admin Assist (79K) Street Maint Work (75K) * Zip Recruiter - Averages for Burlingame All other: Mid range salaries from City of Burlingame, BSD or SMUHSD $104,400 HS Teacher (104K) Librarian II (91 K) Accountant II (94K) $119,300 School Occup Therapist (1 15K) HR Analyst II (1 1 OK) City Arborist (1 18K) $134,200 Middle School Dean (133K) Police Services Mgr. (134K) Assoc Engineer (122K) $116,200 School Social Worker (109K) Bldg Inspector 1 (105K) Police Officer (107K) $132,800 Police Sergeant (130K) Water Div Mgr. (128K) Fleet Mgr. (125K) $149,400 Deputy Finance Dir. (149K) Transport Program Mgr. (136K) Vice Prin Elem School (149K) $139,450 Rec Superindentent (135K) Finance Service Mgr. (136K) Library Services Mgr. (135K) $159,350 Chief Bldg Official (158K) Planing Mgr. (153K) Elementary Principal (159K) $179,300 City Engineer (169K) Assist City Attorney (166K) HS Assist Principal (174K)