|
Getting your Trinity Audio player ready...
|
Mountain View City Council reluctantly supported a housing project on San Antonio Road after the applicant initially presented two options to meet its affordable housing obligation, only to withdraw one of the options part way through the Oct. 25 meeting.
The project, located on the corner of San Antonio and California Street at 334 San Antonio Road, would replace the existing Valero gas station with a five-story building of flat-stacked, ownership condos, accompanied by 2,000 square feet of ground-floor commercial space.
Though the city’s development standards only allow for up to four stories, the proposed fifth floor is allowed under the state’s density bonus law, which lets developers build higher in exchange for making some of the units affordable.
While the market rate units are estimated to be listed in the $1 to $1.3 million price range, sale prices for the below market rate (BMR) units are expected to be between $200,000 to $460,000, depending on the buyer’s income level and the number of bedrooms in the unit.
The applicant initially proposed including 13 BMR units in order to comply with the state density bonus law and the city’s affordable housing ordinance. But after concerns were raised to the Environmental Planning Commission about the BMR units not being equitably distributed or proportional to the overall bedroom mixes, the applicant offered an alternative approach: including only 10 BMR units instead of the originally proposed 13 units, but with a better mix of bedroom counts.
Both city staff and the Planning Commission recommended option 2, with 10 BMR units, to the city council, though both code-compliant options were still on the table as the council began discussing the item on Oct. 25. Council member Ellen Kamei made a motion to support option 1 over option 2, and Council member Pat Showalter seconded the motion.
“I think that the biggest component was trying to grapple with the number of BMR units,” Kamei said. “I’m really more compelled toward more units. … So for me, I’m compelled to move forward the staff recommendation (but) with the original project BMR option, which would be the 13 units.”
But before the council could deliberate further and take a vote, the applicant Mircea Voskerician asked to speak, which is not typically allowed during council deliberation. City Attorney Jennifer Logue granted the request. Voskerician then revealed that he strongly prefers option 2, and wanted to withdraw option 1 from consideration, despite Kamei having already made a motion in support of it.
Logue said that while it’s “unfortunate that this was not made clear in their presentation,” both options are compliant with state and city laws, so the council is bound to accept the project with the option put forward.
Showalter made a new motion to support the project with option 2, adding, “I can’t say I really appreciate this behavior on the part of the developer, but at the same time, I do think this is a good project.” Council member Alison Hicks seconded the motion, echoing Showalter’s frustrations.
“I’ll vote for the project. It is compliant,” Kamei said. “… I’d also like to say to the applicant, this is not how we do things in Mountain View. We do not change things in real time during the meeting when it’s in deliberation. I find it really unacceptable to be put in a situation where we’re given two options and then be told that those two options no longer exist.”
Council member Lisa Matichak added that she agrees with Kamei and found the last minute withdrawal of option 1 to be “incredibly disappointing.”
Despite their frustrations, the council voted unanimously to support the project with option 2, which offers 10 BMR units.
“We do not change things in real time during the meeting when it’s in deliberation.” Unless they do, and they obviously did. What is to be gained by voting for this even though everyone who was voting said they “didn’t appreciate” the bait and replace method? Were they paid off? Are they given first dibs on a slot to use for an investment? “Power tends to corrupt; absolute power corrupts absolutely.”
@MyFeelz — state law prohibits cities from denying projects that comply with local and state regulations. We did not have the discretion to reject the project. I would encourage you and others to read about the Housing Accountability Act in particular. A technical assistance document from the state is available here: https://tinyurl.com/2p8msefh
A project using the State Density Bonus Law is deemed compliant with regulations even if it exceeds development standards in zoning or the governing precise plan. Consequently, we could not make legally defensible findings to support project denial.
Lucas Ramirez
Greater San Antonio Area
@Lucas Ramirez – true, but you could have approved the also-fully-compliant Option 1 that the developer proposed and was under motion to consider. The developer submitted a proposal with two options – they don’t get to change their mind in the middle of the meeting. Council could have approved Option 1. If the developer didn’t like it, they could withdraw their application or try to come back another time to amend it. I would also point out that the removal of Option 1 from consideration Council action was not properly noticed per the Brown Act, so the Council may have put themselves into some jeopardy there.
@Ellen Kamei (“I’d also like to say to the applicant, this is not how we do things in Mountain View. We do not change things in real time during the meeting when it’s in deliberation. I find it really unacceptable to be put in a situation where we’re given two options and then be told that those two options no longer exist.”) – Uh, apparently it IS how we do things in Mountain View and YOU DO find it acceptable. And UNANIMOUSLY APPROVABLE! However, I’m sure the developer feels really ashamed after of their conduct after you approved their project.
Mayor Ramirez, you wrote: “state law prohibits cities from denying projects that comply with local and state regulations. We did not have the discretion to reject the project.”
Does the City Council have any ideas and/or plans to pass local regulations to change this situation going forward? It is highly frustrating to watch the City Council “reluctantly” approve project after project.
Developers appear to have more power than that City Council! They can treat you shamefully, even change major details at the last second, and you still are required to approve their proposals? Is this truly what state politicians want for a community such as Mountain View? Can we bring this to the attention of Gov. Newsom, and ask for his help?
Over the last 8-year RHNA cycle, almost 90% of housing units were for expensive, market-rate units, a grossly disproportionate amount considering that over HALF of MV households qualify for the bottom three RHNA lower-income targets. This is FAR TOO LITTLE, and this developer just took 3 precious BMR units off the table. There is no way that we will achieve our RHNA targets for low-income households if developers are allowed to behave in this manner. No way.
If we can’t get developers to build at least 15% of units in a project as BMR, which the city requires (?) but fails to achieve (!), can you pass an emergency ordinance to halt construction of all new offices in MV until the jobs/housing imbalance reaches an acceptable level? Every new office project increases demand for housing, and drives the cost of rent higher.
Do you have any ideas to change the dynamics of this situation?
I heartily agree with Leslie Bains proposal that City Council stop approving more office space until we get the housing imbalance dealt with. And her point about the percentage of low-income households in MV vs the amount of BMR housing being built should be well-taken by City Council. Likewise, I agree with SCParent’s comment that the developer could have been told it was too late to take Option 1 off the table because the proposal was already in deliberation. I respect our Council and appreciate their frustration when their hands truly are tied legally in terms of having to approve development plans. It’s time to fix that. We need a more streamlined way of establishing City regulations regarding development that’s in keeping with current needs.
Council, you need to ‘rein in’ your city attorney. That attorney works for you, and not ANY developer. Mayor Rameriz, it is appropriate for you (or any Council member) to ask that a legal item, that might be a future legal contention, to be discussed in Closed Session between you’al and your lawyer. Then you can come back into Public Session.
[ref, League of California Cities / Open & Public / pg 44
“Before holding a closed session under the pending litigation exception, the legislative body must publicly state the basis for the closed session by identifying one of the following three types of matters: existing litigation, anticipated exposure to litigation, or anticipated initiation of litigation.18″
‘Anticipated exposure to litigation against the local agency
Closed sessions are authorized for legal counsel to inform the legislative body of a significant exposure to litigation against the local agency, but only if based on “existing facts and circumstances” as defined by the Brown Act.20 The legislative body may also meet under this exception to determine whether a closed session is authorized based on information provided by legal counsel or staff. In general, the “existing facts and
circumstances” must be publicly disclosed unless they are privileged written communications or not yet known to a potential plaintiff.”
Perhaps – a Council member needs to Add an Item to the next meeting / “performance review – city attorney” and then you’al can talk this out! Good performance / or poor? (for protecting the interests of a city council).
/// Agenda Items may EASILY be Moved to Defer to the next Council Meeting. (need ‘more thought’?)
LCC “Counsel and Council” revised 2022
https://www.calcities.org/docs/default-source/city-attorneys/cc-counsel-council-2022-ver4.pdf?sfvrsn=ffd5aa65_3
Pardon my skepticism but I’d have to believe that the developer planned this chess move well in advance of the council meeting. And probably popped open a bottle of Cristal afterwards to celebrate that it even worked.
But yeah, agreed. Option 3 would have been to put the brakes on this thing during the meeting and have the developer resubmit the plan choices for later.
Just an observation,
Until the actual housing elements are built and are checked for quality, they are STILL vaporware.
A “commitment” is NOT a housing element yet.
Google promised as much as 10,000+ housing units as far back as 2007. Nothing exists yet.
Since the GDP is still rising, the Fed has been given the green light to continue raising rates. It is almost assured that by Jan 2023 the mortgage rates will be 8.5%. And all other loans will raise accordingly. This pattern means we could see the fed rate increase by at least 3% moving forward, reaching 6%.
That means that either the suppliers are going to have to cut prices, or they wind up with inventory that they can’t sell.
And they will have to stop borrowing money because credit is going to dry up or it is too expensive. This is a major problem because at least 50% of all businesses are moderately overleveraged with debt. 25% are called ZOMBIES for this reason
This is not going to be saved like the last time in 2007-8 because the market failed to fix itself. No bail outs this time. Prices WILL eventually correct for the future, and those prices are going to be a LOT lower than what many bet they would be.
So we do not have any new pizzas at this time, so there is no slices available to anybody.
That’s Mr. Voskerician’s problem now, not the Council’s. Council had to approve the project (last-minute shenanigans over unit count notwithstanding).
First, replacing a gas station with housing is a good development for Mountain View (less traffic, better air quality …. and more housing)
Second, city council’s only choice was between accepting the project or being sued (and more than likely lose). Dura lex sed lex.
Third, options 1 and 2 provide the same amount of affordable housing when counted in number of bedrooms. IMO, option 2 was better as it will help more families in an area served by the Los Altos School District.
That said, City Council was fully justified to be annoyed by the developer’s volte faces: adding option 2 at the last minute before the EPC meeting, pulling Option 1 at the 11th hour during Council Meeting, proposing a bigger project after agenda is noticed….
Oh boy, more $2.5 Million condos….
Just an observation,
Since the GDP was above 2.5% and still more than 6% inflation, along with no significant job losses the FED is still going to be VERY stubborn and increase the rate by at least .75% in November, and VERY likely to do the same in December.
That will raise the Fed rate to 4.5% which is at best only .5% below housing cap rates.. Cap rates require SIGNIFICANT effort to reach those goals. But with only about 11% improvement that effort is really a loss. Time equals money.
If you invest $1M in Fed notes where they are currently at 4.3% for a 2 year or you invest in a housing business and you get 5% while at the least investing 500 hours a year for that yerarly earnings.
That means you can get $43,000 with no work or $50,000 investing 500 hours. The real earnings are $50,000-$43,000 or $7,000 divided by 500 hours equates to only $14. an hour. Less than minimum wage and if you are lucky.
This is why real estate is becoming the biggest bubble in this area. Just understand the Mortgage rates are likely to increase by at least 1.5% by the end of the year. That kind of cost to borrow is possibly going to cancel many projects because they cannot sell the new housing without eating a major loss.
And current owners are in serious trouble too, when mortgage companies see their contracts collateral lose money, they have no choice but to pull the mortgage. Because they are no longer secure, it can be a multimillion dollar cred card debt that they cannot afford to charge only the mortgage rates to be financially sound. These firms have to pay for insurance to cover the original cost and not any updated values that are going down.
For example 184 Centre Street was purchased for $5M in 2016, but the recent tax bill was for only $3.8M with a 45% depreciation on the building of the property. The mortgage company still has to pay for the $5M regarding insurance even though. The mortgage is underwater by 24%.