Mountain View will spend $1M to update its housing plans under new state requirements

New state housing requirements are forcing the city of Mountain View to take a close look at its housing stock and residential zoning to accommodate heavy growth. And it looks like that work is going to cost far more than expected.

City Council members are expected to approve a budget next week for updating Mountain View’s Housing Element, a document that will have to show the city could reasonably support 11,135 additional housing units over the next eight years. City officials thought it would cost about $300,000, but are now asking for just over $1 million.

Like most cities across the Bay Area, Mountain View is being asked to grow far faster than in previous years under the 2023-2031 Regional Housing Needs Allocation (RHNA). The process requires Mountain View to zone for 11,135 additional units, about four times as many as the previous eight-year cycle, that are affordable across a broad spectrum of income levels.

Early on, city officials were banking on an update to the city’s “R3” zoning in order to account for some of that residential growth. But City Council members opted to hit the brakes and solicit more public feedback on the zoning overhaul, meaning R3 changes won’t be baked into the Housing Element.

What’s more, the city may not be able to lean entirely on the North Bayshore and East Whisman precise plans, which include a massive portion of the Mountain View’s future housing growth. Developers — specifically Google — have proposed market-rate units with little in the way of affordable housing, prompting city officials to identify other places that affordable housing could be built.

The upshot is that Mountain View may have to do what it’s calling “targeted rezonings” and will need a detailed update on its site inventory.

Between the possible rezoning and the sheer quantity of units Mountain View is being asked to build, the city will have to conduct a rigorous environmental review that was previously deemed unnecessary. City officials say a full environmental impact report will be needed to assess the effects of additional housing, which is expected to cost upwards of $371,000.

In a bid to create more housing statewide and enforce the RHNA process, the California Department of Housing and Community Development (HCD) is taking a closer look at whether the newly zoned housing is feasible and stands a chance of actually getting built in the next eight years. Mountain View is required to analyze what HCD considers “constraints” on housing, which can include onerous fees, taxes and zoning standards that can drive up costs.

That analysis will dig into financial challenges facing developers, including a new tax under consideration by the Mountain View Whisman School District that places heavy property taxes on all new homes north of Central Expressway. The school district and the city have both grappled with how to pay for new schools that would support residential growth and the students it will generate.

The economic analysis, like the environmental review and the site inventory, is also pushing up costs, and is expected to add $37,000 to the budget. All told, the city anticipates it will cost $1,004,000 to carry out the housing element update. Council members are expected to approve the budget at the Jan. 25 City Council meeting.