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HomeMy WebLinkAboutHCDC 10.30.17 Agenda Housing and Community Development Commission Monday, October 30, 2017 – 6:30 P.M. Senior Center, Room 202 28 S. Linn Street, Iowa City Use the Washington Street entrance or 2nd floor skywalk via Tower Place parking garage 1. Call meeting to order 2. Approval of the September 21, 2017 minutes 3. Public comment for topics not on the agenda 4. Consider amendments to FY2016-2020 CITY STEPS 5. Discuss staff recommendations for addressing neighborhood stability following HF134 6. Staff/Commission Comment 7. Adjournment If you will need disability-related accommodations to participate in this program/event, please contact Kristopher Ackerson at kristopher-ackerson@iowa-city.org or 319-356-5247. Early requests are strongly encouraged to allow sufficient time to meet your access needs. MINUTES PRELIMINARY HOUSING AND COMMUNITY DEVELOPMENT COMMISSION SEPTEMBER 21, 2017 – 6:30 PM SENIOR CENTER, ROOM 202 MEMBERS PRESENT: Syndy Conger, Charlie Eastham, Vanessa Fixmer-Oraiz, Christine Harms, John McKinstry, Harry Olmstead, Maria Padron, Paula Vaughan MEMBERS ABSENT: Bob Lamkins STAFF PRESENT: Kris Ackerson, Tracy Hightshoe OTHERS PRESENT: Maryann Dennis, Megan Carr, Nikki Sand RECOMMENDATIONS TO CITY COUNCIL: By a vote of 8-0 the Commission recommends commitment of $330,000 in local funds to Low Income Housing Tax Credit project proposed by Del Ray Ridge LP. CALL MEETING TO ORDER: Olmstead called the meeting to order at 6:30 PM. APPROVAL OF THE AUGUST 17. 2017 MINUTES: Eastham moved to approve the minutes of August 17, 2017. Harms seconded the motion. A vote was taken and the motion passed 7-0. (Maria Padron not present for the vote). PUBLIC COMMENT FOR TOPICS NOT ON THE AGENDA: Maryann Dennis (The Housing Fellowship) stated that the annual meeting of the Johnson County Affordable Homes Coalition will be Friday, September 29 at noon in room 203 of the Johnson County Health and Human Services Building. TENTATIVE SCHEDULE OF PROJECT MONITORING VISITS IN FY18: Ackerson shared the schedule for the projects that have already been funded in the packet and will invite the project sponsors to update the Commission. Eastham asked if the Commission would receive a summary of the project application and the work that is expected to be completed. Ackerson said he could distribute the applications to the Commissioners for review. CONSIDER A RECOMMENDATION TO CITY COUNCIL REGARDING COMMITMENT OF LOCAL FUNDS TO PROPOSED LOW-INCOME HOUSING TAX CREDIT PROJECTS: Ackerson noted that at the last meeting the Commission discussed the City has set aside local funds to award to developers who are proposing low income housing tax credit projects. Ackerson stated that the funds that were set aside last year were not allocated so t hose funds have been added to the funds to be allocated this year for a total of $330,000 to a project, or multiple projects. Ackerson said they received two proposals, which were distributed to the Commission. Ackerson reviewed a table in the meeting packet with basic information about each proposal: Housing and Community Development Commission August 17, 2017 Page 2 of 9 Project Del Rey Limited Partnership Sand Companies, Inc Planning district Downtown North East Units 28 50 Affordable 20 TBD Market rate 8 TBD Rezoning required No Yes Project cost $5,813,496 $10,441,216 City funds requested $330,000 $330,000 Target demographic Low income families Low income families Sidewalk access Yes Yes Transit service Yes Yes Walking distance to elem. 0.9 miles 0.9 miles Eastham noted that the table doesn’t indicate site control for either of the projects. Hightshoe replied that site control is not required for the application to the City, it will be required at the time the developer applies to IFA (Iowa Finance Authority). Site control means that the developer has a purchase offer or owns the site. Eastham asked if property zoning was required as part of the application process and Ackerson replied it was not. Vaughn noted that on the Sand Companies, Inc. application it doesn’t indicated how many of the units will be affordable, so when will that be decided. Megan Carr (Sand Development, LLC) stated that they are proposing 49 units, 5 would be market rate units and the remaining 44 would be affordable units. 30, 40, and 60 percent income rent limits for the tax credit units. They are still finalizing how many units will be in each category but the latest projections are five 30% units, eight 40% units, and thirty-one 60% units. Padron asked what the percentages mean. Carr stated the rent limit is based on the percentage of the area median income of the tenant so how much the rent can be including all utilities. Olmstead asked if they would be accepting Housing Choice Voucher tenants and Carr confirmed they would. Carr also stated they have the 5 market rate units to gain a higher score in the IFA ratings for funding. Eastham asked what the actual rents would be for each level of units. Carr stated the rents are projected to be: Unit type Range 1 bedroom (8 total) $448 - $940 2 bedroom (17 total) $532 - $1120 3 bedroom (18 total) $619 - $1300 4 bedroom (6 total) $741 - $1400 Housing and Community Development Commission August 17, 2017 Page 3 of 9 Carr stated with regards to utilities the tenants are responsible for electric. Sand Companies will provide heat, Wi-Fi internet, water, and underground parking. There will be balconies on all the units and full appliance package (including washer and dryers in units). All units will be accessible and they will meet the requirements for IFA. Olmstead asked if the units would have one-year leases and Carr confirmed they would and security deposits would be equal to one-month rent. Vaughn asked if there was an existing transit service to the area already. Carr stated that there is not currently but when meeting with the City they noted the land parcel is on a major roadway so there is a potential of expansion of bus service to the area, but there was no guarantee. Padron noted that it is a very busy street and dangerous for bicycle traffic. Ackerson noted that there is a bus stop on Scott Boulevard about three blocks from the proposed site. Hightshoe noted that the area is indicated in the Comprehensive Plan to accommodate multi - family, the parcel is not currently zoned that but since it is near a major arterial road it is a location that can be zoned multi-family. Carr stated that Sand Companies has developed over 30 low income tax credit properties over the last 20 years and are currently in the process of building a site in Coralville at the old Lantern Park Nursing Home site that should be open in November. It will be a senior community but with the similar mix of 30, 40 and 60 percent units. Eastham asked if a rezoning application has been submitted yet for this site. Carr stated they have not because IFA does not require the rezoning to happen prior to the application and they do plan to have more discussions with the City in the coming weeks to determine the next steps. She noted that the current owners of the site have not annexed the property into the City as there are certain tax implications if they were to annex and rezone the property prior to the sale. Eastham asked how many buildings would be on the site. Carr said they are submitting the application for one building however would like to add a second building in the future. They are only purchasing on section of the site, the current property will be divided into three parts. The current home on the property will be one parcel and Sand Companies will own just the northern parcel. There will be roadways added to connect all the properties to other street s north/south and east/west. Eastham asked what the length of affordability are they offering, Carr replied 30 years. Carr noted that in all the time they have been doing this they have only had one building come out of compliance. It was a 15-year building and when they were allocating credits they went back into that building and did renovations to put in back into compliance for another 30 years. All properties have an annual inspection and their goal is to keep the buildings affordable for eternity, not just the 30 years. Maryann Dennis (The Housing Fellowship) discussed the Del Ray Ridge LP proposal. They will also be applying to IFA for the non-profit set-aside tax credits which is required by the IRS (10% of all of the credits awarded in the United States are automatically set-aside for qualified non-profits). Dennis noted they have a signed letter of intent with the seller and the property is already zoned correctly. The development team is ready and they have already received $800,000 from the Johnson County Housing Trust Fund for the land acquisition. She noted that the new qualifications required by IFA does not award any points on the application for local Housing and Community Development Commission August 17, 2017 Page 4 of 9 government assistance. Dennis said it is a small site in the Riverfront Crossings Distr ict (628 South Dubuque Street) so there is the affordable housing requirement additionally for the Riverfront Crossings District. Eastham asked about site control. Dennis stated they have a willing seller and a letter of intent and will have a purchase option by the application date. Eastham stated Del Ray included a rent table in their application and he has a few questions regarding the proposed interest rate on the City’s LIHTC funds perhaps a lower interest rate for the Trust Fund to better reduce the rents on some of the units. Dennis said the Trust Fund is not likely to reduce their interest rate, but if the City wanted to that would be great. Dennis noted that as far as affordability, it is required that the units remain affordable for 30 years. After the 15 years when the syndicators and investors are out there is a rule for the right of first refusal for a qualified nonprofit to purchase those units. Therefore The Housing Fellowship fully intends to purchase the units to make sure they remain affo rdable for the life of the property. Dennis noted there is a table in the Commissioners’ packets that shows the rent breakdown for the units. These amounts are what are proposed now, by the time they are rented up it will be 2019 so it could change a bit. Eastham asked if Dennis could talk about The Housing Fellowships experience with the demand for one bedroom versus two bedroom units. Dennis replied that currently they do not own any one bedroom units and they receive a lot of calls for one bedroom uni ts. They currently own two, three, and four bedroom units and their vacancy rates run annually under four percent. Dennis confirmed that all the units would be equipped with all appliances including a washer and dryer in each unit. Dennis noted that the State agency that awards the credits has a large detailed application that is scored by points and it is very competitive. She noted it is also very expensive to even apply for the credits. The decisions are based on points, so each applicant wants to include everything in their project they can to gain the most points on their applications. Vaughn asked Carr to speak about the size of the units for the Sand Companies project since The Housing Fellowship had their listed in their application. Carr replied that their one bedrooms 718 square feet, two bedrooms are 1100 square feet, three bedrooms are 1400 square feet, and four bedrooms are 1700 square feet. She added that the one bedroom units will have Housing and Community Development Commission August 17, 2017 Page 5 of 9 just one bathroom but all other units will have two bath rooms and that all units will have patios or balconies. Padron noted that the Sand Companies project has a playground for children and asked if The Housing Fellowship project would as well. Dennis replied that their project will not have a dedicated children play area as since they are one and two bedroom units they do not anticipate a lot of children. Eastham moved to recommend commitment of local funds to the proposed Low-Income Housing Tax Credit project submitted by the Del Ray Ridge LP. Vaughn seconded the motion. A vote was taken and the motion passed 8 -0. Padron noted that the other application (Sand Companies) has no bus service to their project and that is a concern. Hightshoe acknowledged that is true, but when the City looks at land banking for affordable housing the fringe areas are where they look because while there might not be transit service now, in 10-15 years when the area is built out there likely will be adequate transit service. Eastham noted that if the concern is the fringe areas be ing developed without affordable housing included then City Council should commit to including that in development areas. Eastham discussed the City interest rate on the project and suggests that Council reduce the City’s interest rate to 0% and have the applicant reduce the rents so they really are affordable noting that people making less than $20,000 per year still could not afford these units. Hightshoe noted that the City does not require the applicant to pay interest on the funds, the applicant put it in their application. Dennis commented that the way the credits are allocated so the investors can enjoy the income tax credits they receive and if there is a grant in the funding sources that is not an eligible basis for the investors to receive the credit. Therefore, the funding has to be some type of loan, but it could be a 0% loan. However, until the final project budget is finalized she cannot guarantee even with the 0% loan can they make the rents affordable to an individual making less than $20,00 0 per year. CONSIDER APPROVAL OF THE FY17 CONSOLIDATED ANNUAL PERFORMANCE & EVALUATION REPORT (CAPER) – ONLINE AT WWW.ICGOV.ORG/ACTIONPLAN Ackerson noted that the Consolidated Annual Performance & Evaluation Report is something Staff compiles at the end of every fiscal year. At the beginning of each fiscal year the Commission awards funds and Staff then tracks projects that are funded in the Annual Action Plan. At the end of the year this report is provided as a summary of the projects to the Commission, HUD, and the public to show how the funds were used and what was accomplished. The document has been published for two weeks for public comment, once approved by the Commission it will be filed with HUD. The report includes two tables that summarize the CDBG and HOME projects and show at-a-glance what has been accomplished. Fixmer-Oraiz questioned the table on page 8 regarding racial and ethnic composition of families assisted and that it states it meets the requirements and have been successfully marketed to African American households but none of the families assisted were African American or people of color except Hispanic and Not Hispanic. Hightshoe noted the table does not that 2100 African American citizens are assisted under the CDBG funding, but none were assisted under HOME funding. Hightshoe noted the difference is the City does owner -occupied housing rehab with the HOME funding and typically they see almost all white households, occasionally a Hispanic household but rarely get African American homeowners that apply for that program. CDBG funding is used for rental assistance and that is where they see more African American applications. The census shows Housing and Community Development Commission August 17, 2017 Page 6 of 9 a higher percentage of white population in our City as well as a lot of the owne r-occupied rehab housing is for elderly and that percentage of white population is even higher. Fixmer-Oraiz asked how the program is marketed. Ackerson said every project is a bit different. Some are through referrals such as the Mayor’s Youth program, System’s Unlimited, etc. Hightshoe noted that when the Habitat for Humanity units are report, those are often persons of color. Eastham asked if the CAPER was to report on projects still in progress and Hightshoe said they only report on projects completed in that fiscal year. Vaughn asked if there was any re-evaluation done on how many successful projects were completed and how many were assisted by the projects. Ackerson explained that the annual action plans are part of a five-year consolidated plan (the current plan will go through 2020) and at the time of drafting a new consolidated plan is when all the data will be compiled and reviewed. Hightshoe noted the affordable housing chart (on page 15) just shows the one-year goals and FY17 projects. Currently there are 133 affordable units underway, yet to be finished and under the HOME program they are given four years to complete projects. Eastham suggested that the City publish a report showing each project in progress, the beneficiary, and funding. Ackerson said he can export from the system a report showing race, ethnicity, and income. He noted this will also be part of the Assessment of Fair Housing that will provide data for the next five-year consolidated plan. Fixmer-Oraiz moved to approve the FY17 Consolidated Annual Performance & Evaluation Report (CAPER) with edits discussed, Harms seconded the motion, a vote was taken and the motion passed 8-0. UPDATE ON INVEST HEALTH INITIATIVE: Hightshoe noted that last year the City applied to the Robert Wood Johnson Foundation (one of the largest healthcare foundations in the United States) for an Invest Health Grant. Out of 180 cities that applied, they selected fifty and Iowa City was chosen. There are five members on the Iowa City committee. Hightshoe represents the City as one of the members on the committee, there is a person from The University of Iowa College of Public Health, someone from The University of Iowa Hospitals and Clinics, Pauline Taylor from the Iowa City Council, and Maryann Dennis fro m The Housing Fellowship as the community development housing specialist. Their application to Invest Health was based on the idea to improve neighborhoods. They concentrated on asthma and mental health and looked at poverty data (where they are living), concentration of minorities, and the data regarding emergency visits to The University of Iowa Hospitals for asthma. The committee overlaid this information on a map and four neighborhoods had concentrations. The areas we are concentrating efforts on are: Pheasant Ridge, Towncrest, Broadway, and Hilltop mobile home park. Hightshoe noted that according to the school district, asthma is highest in the Lemme and Lincoln elementary attendance areas but those are not the same children going to the emergency rooms with severe persistent chronic asthma problems. The committee worked with a bunch of stakeholders in the community (the University, medical provides, free medical clinic, neighborhood advocates, etc.) and they surveyed three of the neighborhoods (they were unable to survey Pheasant Ridge because they could not take on that capacity) of over 600 households and received responses from about 20%. The surveys showed that people have financial stress, they are worried about their housing, and in some neighborhoods over 50% of the folks are stressed, angry, depressed, or suffer from other mental health issues. Some of the neighborhoods also reported issues with mold, pest infestations, and other things that trigger asthma and respiratory problems. Hightshoe will circulate the summary of the survey results with the Commission as some of the responses were surprising. For example, for mental health issues, the primary contact for some of the respondents were their church minister or Housing and Community Development Commission August 17, 2017 Page 7 of 9 pastor (not a health professional). Hightshoe noted that it wasn’t all bad, but there were some problems in the neighborhoods. One area was social isolation, as seen in the Broadway neighborhood (30% didn’t know who their neighbors were). The committee has been brainstorming with the stakeholders group on how to move forward. In December they need to have a pipeline of projects prepared that will address the problems they have identified and then they must present their business plan to obtain funding. They have been working with Iowa City Compassion to prioritize the issues and narrowed the list to a top 20 that could be addressed reasonably with the resources available. The committee then took that list of 20 projects to the neighborhoods to see what they would prefer and no matter where they presented this list, the top five were the same each time. (1) Affordable daycare centers; (2) more decent and safe affordable homes without rent increases; (3) safe place for activities in immediate neighborhoods for small children; (4) center for th ose with mental health and substance abuse issues and; (5) promote public art and events in neighborhoods. After those five were identified the committee looked at their capacity and what they could present for funding, they narrowed it down to three projects and now are discussing how they develop these three projects with a business plan and a way forward. Those three projects are (1) behavior access center (an alternative to jail or emergency room); (2) affordable daycare and improving the birth to five year child care system as it is such a huge financial stress for working citizens. They are working with Kirkwood, the County, and other stakeholders for a public space. And; (3) working with a College of Nursing adjunct faculty member and using the building on Arthur Street to provide a holistic service for those with chronic mental illness in both counseling services and primary care. So the committee is looking at these three projects and working on getting business plans in place to present to the Invest Health people in December. Hightshoe noted that along with these three projects, they are also looking at what they might be able to do on a local level. This partnership with The University of Iowa College of Public Health and UIHC has allowed them to also create two initiatives recently. (1) The Free Wheels initiative where Police, Neighborhood Services, and World of Bikes worked together and 15 low-income junior high kids could receive 15 bikes the police had impounded and World of Bikes had fixed up. World of Bikes also taught the kids bike safety, safe routes to school, and how to maintain the bikes. The City provided the kids with helmets and locks. The Police have indicated they will be taking this program over and sustaining it year after year. (2) They applied to The Housing Trust Fund of Johnson County for a Healthy Homes grant and was awarded $75,000 and are partnering with the College of Nursing to identify children with asthma and have a qualified healthy home air quality inspector go with a nurse to the home to inspect the house and the nurse will provide in-home asthma care instructions. They have five applicants so far and will see how the process goes. Hightshoe also stated that with the daycare idea the City is taking part in The Bloomberg Challenge. Former New York City Mayor Bloomberg has a foundation where they give money through a competition showing new initiative to help others. The City is going to enter their daycare idea into this competition. UPDATE ON ANNUAL INPUT FOR CONSOLIDATED PLAN - IC COMPASSION BACK- TO-SCHOOL EVENT: Ackerson noted that it was an event that they attended and used it as a source to survey for the Invest Health initiative grants discussed above. STAFF/COMMISSION COMMENT: Padron as a new member of the Commission introduced herself and told a little about herself. Housing and Community Development Commission August 17, 2017 Page 8 of 9 Hightshoe stated at the Council’s last work session meeting they address zoning occupancy changes due to the State no longer allowing cities to zone by familial status (not allowing more than three unrelated persons in one home). Council is questioning what they can now to maintain neighborhood stabilization and most concerned about student housing in the single family and duplexes in the downtown area. This will likely be on the agenda for the next meeting to see if the Commission has any recommendations. CORRESPONDENCE: None. ADJOURNMENT: Eastham moved to adjourned. Vaughn seconded, a vote was taken and the motion passed. Housing and Community Development Commission September 21, 2017 Page 9 of 9 Housing and Community Development Commission Attendance Record 2017 - 2018 Key: X = Present O = Absent O/E = Absent/Excused --- = Vacant or prior commissioner Name Terms Exp. 10/20 11/17 12/15 1/19 2/9 2/16 3/7 4/20 6/15 8/17 9/21 Conger, Syndy 7/1/2018 O/E X X X O/E X X X X X X Eastham, Charlie 7/1/2020 --- --- --- --- --- --- --- --- --- X X Fixmer-Oraiz, Vanessa 7/1/2020 --- --- --- --- --- --- --- --- --- X X Harms, Christine 7/1/2019 X X X X X X X X X X X Lamkins, Bob 7/1/2019 O/E X O/E X O/E X X O/E X X O/E McKinstry, John 7/1/2020 X X X X X X X O/E X X X Olmstead, Harry 7/1/2018 O/E X X X X X X X X X X Padron, Maria 7/1/2018 --- --- --- --- --- --- --- --- --- O/E X Vaughan, Paula 7/1/2019 O/E X X X X X X X X X X   Date: October 13, 2017 To: Housing and Community Development Commission From: Community Development Staff Re: October 19 Meeting The following is a short description of the agenda items. If you have any questions about the agenda, or if you are unable to attend the meeting, please contact Kris Ackerson at 356-5247 or Kristopher-Ackerson@Iowa-City.org. Consider amendments to FY2016-2020 CITY STEPS Each year the City is required to consider amendments to the adopted Consolidated Plan (CITY STEPS). At your meeting on September 21 you received a summary of input gathered at a back-to-school event hosted by IC Compassion and other Invest Health summer activities. Staff does not propose any amendments at this time. Discuss staff recommendations for addressing neighborhood stability following HF134 City staff has spent the past two months drafting possible code and policy changes that would address potential implications of State House File 134. The staff memo to City Council is attached for discussion purposes. CITY OF IOWA CITY MEMORANDUM DATE: 9/14/2017 TO: City Council FROM: City Manager and Department of Neighborhood and Development Services RE: Recommendations for Addressing Neighborhood Stability Post HF134 INTRODUCTION Last spring the legislature adopted HF 134 amending Iowa Code Section 414.1 to prohibit municipalities, after January 1, 2018, from adopting or enforcing any regulation or restriction related to occupancy of residential rental property that is based upon the existence of familial or nonfamilial relationships between the occupants of such rental property. This limitation threatens the stability of Iowa City's neighborhoods that are impacted by their proximity to the University of Iowa campus and the pressures of the rental housing market. On June 8, 2017 the City Council adopted ordinance no. 17-4710 establishing a moratorium in a defined area until December 31, 2017 on the issuance of new rental permits and building permits that would result in the enlargement of an existing rental dwelling in single family zones. The purpose of the moratorium ordinance was to give the City time to "study how to mitigate the impacts of rental housing and increasing occupancy levels on neighborhood stability, housing affordability, public and tenant safety, urban congestion, blight, risk to public peace and order, conflicts between rental and owner-occupied housing and excessive demands upon public safety, infrastructure and municipal services." This memo will summarize staff's efforts and recommendations to date. ANALYSIS Public safety and housing inspection data suggest that concentrations of rentals have a destabilizing effect on single family neighborhoods. Due to the high demand for rental housing near the University of Iowa campus, the mix of rental housing in the nearby neighborhoods includes high density apartments, duplexes, rooming houses, and many older single family homes that have been divided up into apartments or operate as de facto rooming houses. While the private market response has provided needed rental housing, it has also decreased the availability of affordable options for permanent residents of diverse demographic and socio-economic statuses. This has had a destabilizing effect on neighborhoods that will be accelerated if the City does not proactively respond to HF 134. In 2012, due to an increasing number of nuisance, disorderly house, and noise complaints, as well as safety concerns expressed by students and the University, the City adopted a number of changes to better manage the occupancy, residential density, and parking requirements for multi-family dwellings. These changes have opened up new opportunities for multi-family 1 development with a wider range of apartment sizes. In addition, in 2014, the City adopted a new form-based code for Riverfront Crossings that has facilitated a building boom in higher quality, high density apartments in areas close to downtown and the Ul campus. Much of the new multi-family development is designed to serve the university-centric housing market. The decision to facilitate new rental opportunities in non-single-family zoning districts was purposefully made to help relieve pressure on nearby single-family neighborhoods that were experiencing destabilizing effects of increased rentals. The immediate concern created by HF 134is the predicted acceleration of destabilizing effects in the central and next ring single family neighborhoods that surround the campus and downtown. Map #1 and Map #2 (attached) illustrate the intensity of the rental permits and noise and nuisance complaints in Iowa City, respectively. The boundaries identified on the maps are the City's neighborhood open space districts, which provide already defined areas at the neighborhood level. Map #3 shows the percentage of single family and duplex units in each neighborhood that have a rental permit. These maps demonstrate a positive correlation between the number of rental permits and the number of destabilizing noise/disorderly house and nuisance complaints in the areas closest to downtown and the Ul campus. As many cities do, in the current City Code, a single family house or duplex unit can be rented to one "household". Single family homes and neighborhoods are intended for occupancy by persons who function as a relatively permanent single household unit or family. To this end, under the current code, a "household" may include no more than 3 unrelated persons. With the change in the law this tool is no longer available and both the afford ability and desirability of the core neighborhoods to permanent residents is diminished with a resulting destabilizing effect on the neighborhood. There will be greatly increased economic pressure to convert owner-occupied housing to rental housing due to the additional value created by the additional occupancy allowances, and it is reasonable to assume based on the attached maps that the additional rental opportunities will result in more nuisance complaints. To summarize, the main destabilizing effects of concentrations of rentals in single family neighborhoods near the University of Iowa campus are: 1. A higher percentage of renters versus owner-occupants in these single family neighborhoods results in fewer people that are invested in the long term health of the neighborhood, a less stable population of families with children to support neighborhood elementary schools, gradual deterioration in the upkeep of homes and properties, and an increase in nuisance issues that discourages investment in housing from a diverse array of demographic and socio-economic backgrounds. Such diversity is key to establishing healthy neighborhoods and supporting diversity and stability in the business offerings in nearby commercial districts. 2. Concentrations of single family and duplex rental units, coupled with the economic realities created by a removal of occupancy restrictions, will dissuade owner occupants from purchasing in the vicinity and make it difficult for an existing owner occupant to sell 2 their home to another owner occupant in the future. This will lead to further destabilization in the neighborhoods. Staff's recommendations reflect a four-prong approach to address these destabilizing effects: 1. Establish a maximum percentage of single family and duplex rentals allowed per neighborhood in neighborhoods most susceptible to rental pressures due to their proximity to campus. ("Impact area"). Once a neighborhood reaches that threshold, no new rental permits for single family and duplex units will be issued (with certain exceptions and exemptions). 2. Establish a minimum spacing requirement for single family and duplex rental units within zones that allow such uses in neighborhoods in the impact area that are not already prohibited from additional rentals (with certain exceptions and exemptions). 3. Adopt a number of changes to zoning and housing code standards that will prevent high occupancy single family and duplex rentals and limit the size and scale of enlargements, and thus keep a more level playing field between students and other populations who want to rent or own homes in the community. 4. Increase life/safety inspections and enforcement of noise and nuisance issues. RECOMMENDATIONS Rental Permit Limits 1. Within the Impact Area, establish a cap on rental permits for single family and duplex units in neighborhoods that reach a certain threshold percentage of single family/duplex rental units On the attached maps, staff used the neighborhood open space district boundaries as a reasonable means to define neighborhood boundaries for the purposes of monitoring the relative percentage of single family and duplex rentals versus owner-occupied units. It is clear that some neighborhoods have reached or exceeded the tipping point where the imbalance between rental and owner occupied housing is already causing neighborhood instability. In these areas, staff recommends that no new rental permits for single family homes or duplexes be issued (with some exceptions noted below). In addition, in other neighborhoods where the university most clearly influences the housing market, the percentage of rental versus owner- occupied single family homes and duplex units should be monitored; if these neighborhoods reach the defined threshold percentage of rentals, no new rental permits would be issued. Staff has drawn a recommended boundary on attached map #3 that defines the area of university influence. The threshold percentage for the cap will need to be determined, but based on our analysis should probably fall somewhere between 35-50% rentals versus owner-occupied units. Once a neighborhood reaches that threshold, no new rental permits for single family or duplex units will be issued, with the following exceptions: 3 • accessory apartments as defined and regulated by the City; • homes rented temporarily while the owner is on an extended vacation, leave or sabbatical; • owner-occupied duplexes, where the owner lives in one half and leases out the other unit; • Approved bed and breakfast homestays and inns. 2. In the Impact Area. establish a minimum spacing between single family/duplex rental units and between single family/duplex rental units and any other residential rental properties within zones that allow single family and duplexes. Staff is in the process of mapping the existing single family and duplex rentals for each neighborhood district within the Impact Area and evaluating various spacing standards from 75 feet to 150 feet. The distance will be measured in all directions similar to how we require separation of drinking establishments. The exceptions noted above regarding the rental cap will also apply to the spacing requirement. If Council concurs with this spacing recommendation staff will provide additional detail when the ordinance is presented for Council consideration. Housing Code Changes. In addition to the rental permit limits identified above, which would be implemented as amendments to the Housing Code, staff recommends the following amendments to the Housing Code applicable to rental units throughout the City to enhance safety and provide some measure of control of residential occupancy of rental units. 1. Adopt: No more than 30% of the habitable floor area of a dwelling can be bedrooms. Other habitable space may not be used as a bedroom Current Requirement: None. Reason for Recommendation: Ensure a minimum amount of the structure being used as common space. Prevent property owners from using dining rooms, living rooms, and other areas as bedrooms that would lead to overcrowding and little shared living space within the home. Mitigate single family houses from being over occupied and used as a de facto rooming house. 2. Adopt: Minimum bedroom size of 100 sf for new rental units, and for new bedrooms in existing rental units. Current Requirement: 70 sf minimum bedroom size. 4 Reason for Recommendation: Discourage existing rental units, particularly single family and duplex rentals, from being chopped up to increase the number of bedrooms, while reducing the overall quality of the living space within the home. This will also ensure a more livable bedroom standard for future rental units. 3. Adopt: Any bedroom over 200 sf in size will count as two bedrooms based on 100 sf per bedroom. Current Requirement: The number of bedrooms within a multi-family unit is currently limited to 3. Reason for Recommendation: Experience is that bedrooms over 200 sf in size contain two occupants. This change will discourage developers from building really large bedrooms in order to house multiple tenants within each bedroom, thus causing overcrowding and reduced quality of life for residents. Standard would be used to determine required parking. 4. Adopt: Require interconnected smoke alarms (hardwired or wireless) in rental units with four or more bedrooms (would apply to new rental units and to existing units adding bedrooms). Current Requirement: None. Reason for Recommendation: Life safety. Single Family/Duplex are not designed for high rental occupancy. 5. Adopt: Require duplex units to have permanently installed and maintained physical separation between units. Current Requirement: The Building Code requires complete separation; however, the Housing Code has not required separation to be permanent which is often only with a lock. Reason for Recommendation: Life safety and privacy. Also prevents duplex units from functioning as one large house. 6. Adopt: Require dead bolts or other locks which can be operated from inside the dwelling unit. Current Requirement: None. 5 Reason for Recommendation: Safety. Requested by UISG (University of Iowa Student Government). 7. Adopt: All properties with more than one roomer/renter will be required to have a rental permit, notwithstanding whether the property is occupied by an owner. Current Requirement: Owner-occupied properties are not required to have a rental permit. For example, if a person on the deed lives in the house, no rental permit is required, even if four friends also live in the house and pay the owner rent. Reason for Recommendation: Improve safety. Ensure housing code requirements are met in higher occupancy rental properties, notwithstanding owner occupancy. Rental permits require inspections. With no limit on the number of occupants based on familial relationship, the number of unrelated persons living in single family homes will likely increase. Single family and duplex units are not designed for high rental occupancy. 8. Amend the rental sanctions section of the Housing Code to consider disorderly house and other violations over a 24-month period as opposed to the current 12-month period this amendment to be effective January 1, 2018. In practice, staff currently uses only criminal complaints to pursue rental permit sanctions-begin to also use significant property maintenance violations as spelled out in Housing Code Section 17-5-16-8b. Zoning Code Changes Staff anticipates making the following recommendations to the Planning and Zoning Commission this fall: 1. Establish maximum building depth and width standards for new single family and duplex structures based on form-based standards for house-scale buildings. This will keep structures and additions consistent with house-scale dimensions in single family neighborhoods. 2. Increase the rear yard setback and establish a minimum amount of impervious surface in the rear yard. These standards will help keep structures and additions consistent with house-scale dimensions in single family neighborhoods and ensure a minimum amount of rear yard space is preserved as usable open space. 3. Amend parking requirements to be based on the number of bedrooms, as opposed to the number of unrelated persons. Establish parking placement standards for detached garages and surface parking areas. This combined with the limits on 6 building size and preserved rear yard space will discourage single family homes from being converted and/or enlarged into de facto rooming houses. 4. Amend the Zoning Code to be consistent with changes to the Housing Code related to bedroom size. 5. Amend the Zoning Code to remove definitions of 'family,' and update household definitions and use categories to bring our zoning code into compliance with the restrictions imposed by the State legislature. Enforcement For public safety and neighborhood stabilization purposes, staff recommends increasing enforcement of the Housing Code, nuisance code, Zoning Code and other related neighborhood quality code provisions by: 1. Conducting annual inspections for multi-family properties older than 1996, rooming houses, group homes, public housing units, and single-family and duplex properties with 4 or more bedrooms beginning July 1, 2018 (exempt if the property meets the current building code}. Staff proposes reducing the permit and inspections fee for affordable units and properties that are part of an affordable public or non-profit housing program. 2. Adding two full time housing inspection staff and one half time police officer to be able to better enforce nuisance violations, including during evenings and weekends beginning next fiscal year, July 1, 2018. Additional Housing Code Changes Staff anticipates recommending the following amendments to the Housing Code to City Council in early 2018 applicable to rental units of all types (i.e., just not Single Family/Duplex) throughout the City: 1. Require the information and disclosure form to be submitted to the City at the time of rental permit issuance. Previously this document, which is used to ensure tenants are aware of general City rules and regulations, was required to be produced upon request. 2. Require a designated agent for each rental property to be available 24-7 to address issues that may arise. 7 3. Clarify timeframe and steps for suspension and/or revocation of a rental permit. Increased enforcement of nuisance and other violations may result in revocation of a rental permit and loss of non-conforming occupancy status. CONCLUSION The above-outlined steps will ensure the City Council's interest in maintaining healthy neighborhoods that are appealing to a diverse population is met. In addition, the City is in the process of evaluating our housing rehabilitation and UniverCity programs to ensure those are also being appropriately targeted to contribute to this same goal. Staff believes this multi- faceted response will adequately protect and enhance our neighborhoods in a manner that steers clear of the familial relationship regulations that the State of Iowa has now prohibited. We look forward to talking to you about these recommendations at your work session on September 19. Attachments-3 maps Copy to: City Clerk w/att. 8 3: en 0 ct lr ::::> :z: IWVRDSW Data Source: Active rental permits as of July, 2017 Map #1: Number of Rental Permits _, .... , ... .. ~r ! 0~~~--\LO ~-'""'fQN .. REK &&.; -. ~ ' ··---· .. Legend ··--. 1 •.• ..: Iowa City City Limits c::J Open Space Districts Number of Rental Permits High : 270 -Low : 0 I ! -:.;.-.l !~.wi;e:llt ~-··Sf~ _,.,., CITY OF IOWA CITY s Author: Sylvia Bochner ~~Ff~OOVER HWY SE "" I I I i.J i I LOWER WEST BRAN ROSE I -·· w en w ~ ~ . ~--.... , r-·---·• "'·• I I .. ~ ~ I 0 1.5 ••-===••••-Miles 0.375 0 .75 Department: Neighborhood and Development Services Projection : NAD 1983 State Plane Iowa Sout h This map is intended to serve as an aid in graphic representation only. This information is not warranted for accuracy or other purposes. Map #2: Nuisance and Noise Complaints ~ (/) 0 a:: !r: ::> J: IWVRD SW Data Sources: Iowa City police calls , 1/1/2013-9/9/2016 ~H s~ 10n\ "I :J:. l3 giH ST J:~ ~ ~(/) m ~ 8TH S-,. ;t: w s.,..,.., I:~ S)' 7TH ST Noise and nuisance compliants include Legend police calls for loud parties , fireworl<s , and general noise complaints , as well as nuisance i' · ~ Iowa City City Limits complaints for the following : r=; . . Couches stored outside L...-J Open Space D1stncts House code issues No rental permit Number of Complaints Maximum : 226 Complaints through ICGovExpress, 4/1912013-3/3012017 On street parl<ing violations Parl<ing on unapproved surfaces Snow removal Tall grass and weeds Vehicle street storage -Minimum: 1 s Author: Sylvia Bochner lf"~ • ~~ff~OOVER HWY SE ~ I I I i.J i I LOWER WEST BRANC ROSE I -·· w (/) w ~ t: ~ .. r-·--··• I I r.. i'...; ~M"HI ST pl ~ ! I I w --·-~ 1;-Q >< IS-~ ::> '1)-Q 6' (/) 0 0.375 0.75 1.5 ••-==::::~•••••M iles Department: Neighborhood and Development Services Projection : NAD 1983 State Plane Iowa South This map is intended to serve as an aid In graphic representation only. This information is not warranted for accuracy or other purposes. Map #3: Percentage of Single Family and Duplex Units that have a Rental Permit - Data Source: Active rental perm its as of July, 2017 i .......... I ' c.---. .• .a ,~i ' •~ L-·--~ Legend C Un iversity Impact Area i:~.J Iowa City City Limits CJ Open Space Districts 21 Wetherby Pheasant Hill / Lemme 6.8 Court Hill I Lucas Author: Sylvia Bochner 0 1.5 ••-===••••-Miles 0 .37 5 0 .75 Department: Neighborhood and Development Services Projection: NAD 1983 State Plane Iowa South This map is intended to serve as an aid in graph ic representat ion only. Th is information is not warranted for accuracy or other purposes .