Santa Clarita planners are recommending the city allow the developer less space between homes, more time to build and more flexibility in general on MetroWalk, a Canyon Country project being proposed for a 20-acre lot near Lost Canyon Road.
But the city can’t recommend New Urban West be allowed to pay a fee to get out of the project’s affordable-housing requirement, according to city officials.
The developer requested a plan amendment last year due to what the project’s principal described as “market forces”: The financing for the affordable and rental components of the development hasn’t been available, according to New Urban West.
A recent city Development Committee meeting discussed the potential for accepting a proposed in-lieu fee — money for the city in exchange for not having to build the affordable-designated units — which the developer has offered, but the city can’t recommend that at this time.
Planners gave several reasons why, according to Tuesday’s Planning Commission agenda. The first being, they’ve never done that before.
During a recent City Council meeting, Councilwoman Marsha McLean said she’d appreciate an updated discussion on the city’s housing policies. City Manager Ken Striplin said such a policy discussion is being scheduled for after the council’s summer recess.
Plans change
Things have changed quite a bit in terms of marketplace demand since a nearly 500-unit MetroWalk was first proposed in 2020, according to the developer.
The plans had called for a mix of market-rate apartments and townhomes (179), townhomes for sale (150), age-qualified apartments (119) and affordable senior apartments (49 plus one housing manager) in four planning areas.
The funding isn’t there to build apartments from the sources that usually fund them, according to letters to the city from Jonathan Frankel, a vice president for New Urban West.
“Now, given market constraints on financing and insurance for multifamily construction, the developer is looking to make a change,” said senior city planner Erika Iverson, “so they want to add single-family detached condos and duplexes to the allowable use types.”
In order to move the project along, the developer wants permission to have more flexibility on its plan, which city staff is recommending.
The apartments and townhomes in the first phase, 298 units in total, should be 127 for-sale townhomes, Frankel wrote in a previous letter to the city.
The plan would essentially eliminate planning areas for the project, and while it wouldn’t change the minimum number of homes built, the developer was asking about the potential for a waiver to get out of the affordable senior homes.
Jason Crawford, community development director for the city, has said the developer indicated a desire to build the affordable component, but was denied several rounds of state grant funding for the project.
There’s another round of state funding currently being sought, which the developer would know more about later this year, he said at a Development Committee discussion of the plans.
Based on the current recommendations, the income-restricted senior units are still listed as a planning condition.
In-lieu fee
There’s also a chance the development could deplete the city’s affordable-housing buffer by 49 units if those homes are removed. The city’s “buffer” has to do with state laws that govern how many homes a city must have planned for approval to be legally compliant with its housing element.
The city has multiple ways to address fewer homes in this respect.
One way to do that is to charge the developer an in-lieu fee, but city staff recognized a few problems with that plan with the explanation of its recommendation in the agenda.
The first is a lack of precedent, which also creates a few challenges.
The city looked at several other “benchmark” cities for comparison, such as Ventura, Thousand Oaks and Glendale, which use the fee.
But the city hasn’t done an in-depth study to look at how those cities are using the fee, any other factors that might offset the cost necessary to subsidize more affordable housing or how Santa Clarita would use that fee to further its affordable housing, which is explained in a staff report.
Using the estimates from benchmark cities, which have a square-footage formula to determine the in-lieu fee, the project would garner anywhere from $692,615 to $1,482,250.
The city also hasn’t done a study to determine what its subsidy cost would be on the 50 homes. But New Urban West’s offer was quickly deemed to be not nearly enough to subsidize a future affordable housing development.
The developer’s offer of $800,000 — which comes to about $16,237 for each of the 49 units — would be considered “laughable” if the city were to offer that to another developer as an incentive to finance affordable units, Striplin said during the Development Committee discussion of the project last month. The estimate given by the city for the current subsidy cost at the meeting was approximately $100,000 to $200,000 per unit.
The city also doesn’t have a plan in place on how it would use such fees, due to the aforementioned lack of precedent. The agenda for Tuesday also states the city’s Housing Element “includes a program to explore the feasibility of an inclusionary housing program, which could include an in-lieu fee and any consideration of an in-lieu fee should follow that exercise.”
Among other recommendations from the city is allow a developer request to adjust the space between units from 10 feet to 7 feet. “The reduction in building-distance separation would maximize the number of duplex or single-family detached condo units that could be built on-site,” according to the agenda.
In terms of the affordable units, the staff seems to be recommending more time, according to the project’s final condition.
“The permittee must secure a building permit for constructing the income-restricted senior apartments concurrently, or before, the (city) issues a final certificate of occupancy for the 240th dwelling unit. The (city) must issue a final certificate of occupancy for all 50 income restricted units before or concurrently with the final certificate of occupancy for the 270th dwelling unit.”
