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Carlsbad ADU Policy

Hat tip to Peter for sending in this article:

CARLSBAD — The city finalized its policy regarding accessory dwelling units to reflect changes in state law.

During its Sept. 1 meeting, the City Council approved amendments to the zoning and municipal codes, in addition to the Village and Barrio Master Plan and Local Coastal Program.

The changes to the city’s municipal code align with six new state laws aiming to spur construction of ADUs, or “granny flats,” and create more affordable housing options for residents.

Don Neu, Carlsbad city planner, said ADUs are secondary residential units on an existing property and the city’s recent approval is keeping in line with the new state laws.

The latest California laws (AB 68, AB 881, SB 13, AB 587, AB 670 and AB 671) allow for ADUs on any lot with single-family or multi-family dwellings to include junior ADUs — units within the walls of a single-family home with a maximum size of 500-square feet — along with ADUs, which are detached units up to 1,200-square feet.

Other changes include setbacks, heights, lot coverage allowing for 800-square-foot units and prohibiting ADUs being used as short-term rentals, Neu said. Also, homeowner’s associations must allow both types of ADUs and state-mandated Housing Elements must include incentives for ADUs, Neu said.

“The processing time to act on a permit request for an accessory unit has been reduced from 120 days to 60 days,” Neu said.

The council also approved the attached ADUs to be 50% of the main dwelling or a maximum of 1,200-square feet, whichever is less. For detached units, 1,200-square feet is the maximum, which is in line with state law, Neu said.

These new guidelines also regulate height limits, which are 16 feet for both detached and attached units, and the city will default to the height allowed by the current zoning. As for landscaping, city ADUs must apply the same requirements as applied to the development of the property, while the architecture must be consistent with the main dwelling.

As of Nov. 2019, Neu said there were 425 ADUs in the city with rent running between $1,416 for a studio and $1,618 per month for a one-bedroom unit. Of the 425, there are 184 that are deed-restricted for lower-income residents and the rest are counted as affordable to moderate-income households.

“These were accessory units that were constructed to satisfy the inclusionary ordinance,” he said.

According to the staff report, the new state law also includes a requirement for the California Department of Housing and Community Development to review the city’s accessory dwelling unit ordinance for compliance.

The city will be given 30 days to respond and indicate if it will either change the ordinance to comply with the state housing department’s findings or adopt it as-is. If no response is made within 30 days, the state may notify the attorney general the city is in violation of state law.

https://thecoastnews.com/carlsbad-updates-municipal-code-to-align-with-states-new-granny-flat-laws/

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Peter also noted this detail which should help to appease the NIMBYs:

Title 21 Zoning Chapter 21.10.030 ADUs has a unique permit requirement:

2g. An owner signed and notarized a notice of restriction, to be recorded against the property, declaring that:

  • The property owner(s) shall reside in either the primary dwelling unit or the accessory dwelling unit, unless a lessee leases both the primary dwelling and the accessory dwelling unit; and
  • The obligations and restrictions imposed on the accessory dwelling unit per the chapter are BINDING ON ALL PRESENT AND FUTURE PROPERTY OWNERS.

Tamarack Tunnel

For a city that has $100 million-plus in the bank and paid $16 million in 2001 for the Farmers Insurance building that still sits vacant, spending $3 million on this must be seen as pennies?

Questions about safety, costs and the possibility of flooding appear to have stalled plans to dig a pedestrian tunnel beneath Carlsbad Boulevard to connect the Tamarack State Beach parking lot with trails along Agua Hedionda Lagoon.

The Carlsbad City Council agreed last week to proceed to the next stage of work on a proposal to build two access ramps to the beach, but they decided to hold off on the $3 million tunnel portion of the project until they have more information about other options.

Councilwoman Cori Schumacher said she was “uncomfortable” with the tunnel. Over the years, it could be affected by storms and sea-level rise, she said, and she asked whether a road-level pedestrian crossing would require less long-term maintenance.

Other council members also had questions about including the tunnel in the beach access project.

“My main concern is the maintenance,” said Councilman Keith Blackburn, who asked about lighting, public safety, graffiti and trash in the passageway.

(more…)

San Diego Housing Bond

This potential bond issue (and resulting property-tax payments) is for the City of San Diego only.  From the U-T:

Supporters of a $900 million housing bond say they will continue pursuing the measure for the November ballot, despite the sharp economic downturn reducing incomes for many San Diego property owners who would be paying the tax increase.

The decision was based primarily on a new telephone poll of 850 likely voters that showed 69 percent support the measure, just above the 66.7 percent needed for approval and a drop in support of only 2 percent since last November.

“Until we saw the poll results, it was totally up in the air,” said Stephen Russell, who is spearheading the effort for the San Diego Housing Federation.  “When we went to poll, we thought we were going to see cratering in the numbers. It was compelling that we are only two points lower than our polling in November.”

Some critics say that an economic downturn is the wrong time to burden property owners with higher property taxes. Russell said the people most affected by the downturn are low-wage workers who pay rent and are most vulnerable to becoming homeless.

The proposal would raise taxes on San Diego property owners to pay for roughly 7,500 subsidized apartments, 2,800 units for the formerly homeless and 4,700 units for veterans, senior citizens, the disabled and low-income families. In addition to the local money it would raise, the measure would help San Diego secure a greater share of state and federal money devoted to homelessness and affordable housing, by providing local matching funds.

The bond measure would cost property owners $19 per year for every $100,000 of assessed value. The average homeowner with a $600,000 property would pay $115 per year, he said.

But owners of large amounts of commercial, industrial or residential property would pay significantly more.

(more…)

Fix Zoning

There aren’t many (if any) of the larger parcels left for big developments, but if the government was an easier and cheaper component, then new infill projects and the repurposing of commercial/industrial properties into residential could benefit – an excerpt from a CalMatters commentary:

If we want to begin to climb our way out of this housing crisis, where do we start? We can begin by fixing zoning, curbing the worst abuses of legacy environmental laws and lowering the mandatory fees that stifle homebuilding at the permit counter.

(more…)

Carlsbad Business-Loan Program

Let’s also survive the effects of the corona!

We (Klinge Realty Group) have been fortunate to stay in full operation and be very productive this year, so we haven’t had layoffs or cutbacks.  In fact, our team has grown – daughter Natalie is now on board!

But for those businesses that need assistance, the City of Carlsbad might be able to help:

The City Council approved $4.4 million for business loans as a part of the Economic Recovery and Revitalization Initiative focused on recovery from the COVID-19 health emergency.

Microloans will be made available for businesses with gross revenue of $2 million or less and 15 employees or fewer with loan amounts ranging from $5,000 to $10,000. Repayment rates are outlined below:

      • 0% interest if paid back within 6 months
      • 1% interest if paid back within 12 months
      • 2% interest if paid back within 18 months

Small business recovery loans will be made available for businesses with gross revenue of $3 million or less and 50 or fewer employees with loan amounts ranging from $10,000 to $25,000. Repayment rates are outlined below:

      • 2% interest if paid back within 12 months
      • 3% interest if paid back within 30 months

All applicants must hold a valid business license with the City of Carlsbad as of March 1, 2020 and be in good standing with the city.

To begin the first step in the application process, please go to http://carlsbadca.gov/loan. We will review your information and respond within five business days with a determination on whether you can proceed with the application process. 

In preparation for the next step in the application process you may want to gather documentation regarding the length of time your business has been in operation, the financial impact that the COVID-19 health emergency has had on your business, at least six-months of bank statements, and your plan for using the funds if awarded

The city will hold a webinar on June 3 at 3:00pm to answer questions regarding the loan program. Please click here to register.

The City of San Diego has closed their loan window already, but they have the list of federal, state, and local financial resources available for businesses here:

https://www.sandiego.gov/economic-development/resources/relief

Upzoning

Here is a relatively-neutral look at the unaffordability problem in America’s bigger cities, and implementing the idea of upzoning to fix it. Backyard accessory homes could really help out here:

Tax-Filing Relief

Image result for uncle sam irs

Federal: Congress is working through several fiscal policy proposals. It is very likely that whatever relief is passed will include tax incentives that will need to be carefully planned for.

The Treasury and IRS announced on March 17 that the tax deadline will be extended 90 days, to July 15, and the IRS will waive interest and penalties for certain taxpayers. The delay is available to people who owe $1 million or less and corporations that owe $10 million or less.

California: The state has granted extensions to individual filers, partnerships and LLCs and quarterly estimated tax payments: Filing and payment is due June 15. The Employment Development Department and California Department of Tax and Fee Administration have also released guidelines.

Housing and Pot

From the MND:

It seems as though legalized marijuana is said to be good for almost everything. Now a new study from the National Association of Realtors (NAR) has added real estate to the list. The impact is clearer when it comes to commercial properties, but agents saw differences in the residential sector as well where medical and/or recreational use of the substance has been legalized.

The NAR study, Marijuana and Real Estate: A Budding Issue (yes, NAR went there) grew out of a survey conducted with over 150,000 of its members, equally divided between those who operate in the commercial area (including building owners and managers) and those who practice residential real estate.

The study looked at states where marijuana has been legalized for medical purposes, for recreation, and for both, examining how it is grown, harvested, stored, sold, and consumed within those states. NAR found more impacts from legalization over time so divided some of the findings according to whether it occurred after or prior to 2016 which accounts for the dual percentages reported.

“As more states legalize marijuana, the real estate market will progressively have to adjust,” said Dr. Jessica Lautz, vice president of demographics and behavioral insights for NAR. “From property owners, to manufacturers, to those who simply want to engage for leisure – it all touches real estate in some form.”

In states were marijuana is legal in some form, between 9 percent and 23 percent of members who responded to the survey said they believe the inventory of available homes is tight for multiple reasons, including all-cash purchases from within the marijuana industry. While most respondents hadn’t seen any changes in property values near dispensaries, between 7 percent and 12 percent said they had seen an increase in values while 8 percent to 27 percent said they had seen values decline.

“Residential practitioners are getting used to the new normal of having marijuana legally used within rental properties, while homeowner associations are tasked with setting new rules to address consumption and growth,” said Lautz.

The majority of respondents reported that homeowner associations have rules that place certain restrictions on smoking and growing marijuana in homes or common areas. Only around 3% answered that specific homeowner associations do allow growing or smoking in home or common areas.

Three-quarters of members had never tried selling a grow house but among residential practitioners who had, 29 percent said they had a difficult time doing so. Twenty-seven percent of those in more recently legalized states reported difficulty compared to 25 percent in states that legalized before 2016.

Because Federal banking laws prohibit use of checks or credit cards to purchase marijuana, it is usually an all-cash business. About one-fifth to a quarter of landlords said they were unwilling to accept cash for rent in any instance, while about 10 percent said they would only refuse cash from an illegal federal activity. Forty-two percent of those in states where only medical marijuana is legal would accept cash rent, as would two-fifth of those where both medical and recreation use is allowed.

Among commercial practitioners, NAR found an increased demand for land, warehouses and store fronts that are intended for marijuana. In states where both uses are legal, more than a third of those polled said they saw an uptick in requests for warehouses or properties used for storage. In those same states, up to one-quarter of members said the demand for storefronts grew, while one-fifth said there was a greater demand for land.

“When the business of marijuana is discussed, some have a tendency to focus on only the buyers and sellers of the product,” said Lautz. “However, these numbers show that marijuana has been a boon to commercial real estate.”

Marijuana as a business has prospered for more than a decade and that growth continues to evolve. In the states where medical and recreational marijuana have been legalized for three years or more, each saw increases in the demands for commercial properties. As in residential uses, the effect on commercial property values near dispensaries was mixed, but about 20 percent reported an increase. There were fewer reports of declines.

Many respondents said leases had been modified to accommodate the marijuana industry, especially where legalization occurred prior to 2016. About half of respondents in medical marijuana states reported no issues leasing a property previously used to grow marijuana as did 35 to 49 percent of those where both uses were legalized. The most common problem among these properties were lingering odors, followed by moisture issues. Both matters were more common in areas where recreational marijuana has been legal for a longer period of time.

It reminds me of this REO we saw on the way to Valley Center. It sold for $950,000 with 5% down in 2005, was foreclosed and sold for $276,500 in 2009 (when this video was taken), and just resold for $775,000 in September.  What a country!  This video has 27,500+ views too!

SB50 Fails

The California Association of Realtors were backing SB50, but it died in the State Senate today.  Hat tip to SM for sending in this article – an excerpt:

California’s controversial housing bill, which would have required cities and counties to change local zoning laws to allow for new, denser housing near job centers and public transportation, died in the state Senate Thursday morning, four votes shy of the support needed to advance the legislation to the Assembly.

The measure has deeply divided stakeholders for more than a year, and lively debate on the Senate floor before an initial vote was taken on Wednesday stretched to two hours. The bill was narrowly defeated 18-15 on Wednesday afternoon, with six senators declining to vote, including Republican leader Shannon Grove, R-Bakersfield, who was in Washington, D.C. It was re-introduced Thursday morning in a final effort to get the bill through before the Jan. 31 deadline, but still failed.

Introduced in December 2018, the bill has failed to pass in the Senate in the past two legislative sessions despite lengthy discussion. It aimed to address California’s severe housing shortage that is driving increases in homelessness in the state, creating a financial crunch for many residents and contributing to urban sprawl that clogs freeways with commuters who live far from their workplaces, according to Sen. Scott Wiener, D-San Francisco, who authored the bill. He argues that local zoning laws are undermining the state’s efforts to address the issue.

The legislation took aim at restrictive zoning and would have required counties with more than 600,000 residents to approve permits for more construction of multi-story housing and streamline the approval process for apartment buildings in neighborhoods near public transportation.

It would have required local governments to approve four-story buildings within half-mile of transit and five-story buildings within a quarter-mile. SB 50 also would give the state more power to curb local parking requirements in favor of more housing, and enable more building in high-income areas. Smaller cities, with less than 50,000 people, would have to add up to 15 extra feet of height to their permits, essentially adding an extra floor of housing, in areas within half-mile from transit.

The bill was endorsed by a diverse group of advocates, including pro-housing organization California YIMBY, the California Labor Federation, and the California Chamber of Commerce.  The bill also garnered support from environmental organizations, including Natural Resources Defense Council and California PIRG, because of its potential to reduce the carbon pollution that comes from long driving commutes.

Senator Toni Atkins (who is the CA Senate President pro Tem, and represents District 39: San Diego, Coronado, Del Mar & Solana Beach) is committed to finding more solutions – this issue isn’t going away:

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