The purpose of this memorandum is to transmit for City Council and Redevelopment Agency Board (hereinafter referred jointly as Agency) consideration recommendations for an affordable housing strategy prepared by the Agency-appointed Blue Ribbon Task Force on Affordable Housing (Task Force).

Having reviewed several studies on affordable housing conditions and program options, the Agency indicated that additional public participation was warranted. The Agency concluded that it had become increasingly apparent that the litany of issues and proposed programs associated with affordable housing should receive further public comment. Council and Agency members, consequently, indicated their interest in forming a task force that would provide recommendations on programs to expand affordable housing.

In order to ensure a broad range of representation from the disparate segments of the community affecting or affected by housing affordability, the Task Force was comprised, in addition to Agency members Marsha Ramos, who served as the chairwoman, and David Golonski, of the following representatives.

• Resident tenants from the Section 8 Housing Assistance Program (two tenants) and from market rate apartments (two members)

• Representation from the following residential developers (nonprofit and for-profit) and housing advocate groups:

Apartment Owners Association of Southern California

Burbank Association of Realtors

Burbank Council on Disabilities

Burbank Housing Corporation

Burbank Senior Board

Cusumano Real Estate Group (multifamily housing developer)

Fair Housing Council of San Fernando Valley

Landlord - Tenant Commission

The Simmons Group (multifamily housing developer)

Wesley Community Corporation

• Representation from the Burbank Unified School District Board of Education and the Burbank Planning Board.

Over six months from July 17 to January 8, the Task Force held eight meetings during which members were exposed to affordable housing issues, toured sites to better understand zoning and planning concepts and visit projects in several neighborhoods, such as Peyton-Grismer. The Task Force was provided with background material, such as the Housing Profile and Housing Elements, that framed discussion supplemented with presentations from the development community, The Olson Company and RTKL, Agency staff and Karen Warner Associates.

The Task Force was formulated to inculcate public participation into the process of developing an overall housing strategy for increasing the supply of affordable housing. In developing this strategy, the Task Force strove to integrate affordability in all forms of housing for ownership and rentals and all income levels and special needs populations.

The Task Force recognized Burbank, as a built-out community, faces a high demand for housing that has eroded housing affordable to low and moderate-income households. In this environment, the Task Force concluded that housing stock growth should be directed primarily along commercial corridors and the downtown, areas associated with non-residential uses better accommodated to more intensive residential products, while also preserving the integrity of single-family neighborhoods. The Task Force also thought it important to continue several programs: acquisition/rehabilitation efforts with the Burbank Housing Corporation, residential rehabilitation, homeownership assistance and Section 8 rental assistance. Finally, the Task Force has put forth several recommendations to regulate development, such as mixed-use zoning guidelines and an inclusionary housing ordinance that requires private developers to include a percentage of affordable units within market rate housing developments.

What follows are specific program recommendations implementing one or more of these objectives:

• Create Community in Conjunction With Housing
• Encourage Balance and Variety In Housing
• Facilitate Mixed-Use and In-Fill Development
• Preserve Existing Affordable Housing
• Sustain and Strengthen Neighborhoods
• Expand Homeownership Opportunities
• Promote Affordable and Accessible Housing to Special Needs Populations

OBJECTIVE 1. CREATE COMMUNITY IN CONJUNCTION WITH HOUSING

This is the most critical of all of the Task Force's recommendations, for it forms the foundation upon which rests all of the other recommendations by creating a sense of community in concert with the development of housing. In addition to supporting affordable housing projects, this objective proposes different types of community serving uses/services be introduced to "enhance community sharing and interaction, thereby improving the overall quality of life in an area."

Two programs are recommended to implement this overarching objective, one that provides service-enhanced housing and the other recommending sustainable building practices.

• Program: Integrate community-serving uses with housing development

The Task Force suggests that fostering community-building in conjunction with new or revitalized housing by integrating community serving uses, such as after-school achievement/activity centers in the Elmwood and Verdugo neighborhoods, is critical to stabilizing these neighborhoods.

• Program: Encourage sustainable building practices

The Task Force also suggests that the creation of community in conjunction with housing can be stimulated by encouraging "environmentally sound, sustainable building" through the City�s incorporation of green building design that emphasizes, for instance, "affordable housing development that is sustainable, facilitates walking and/or use of transit, uses water-efficient landscaping, and maximizes use of the southern California climate for heating and cooling." The City's Building Division is already actively pursuing several of these suggestions.

The Task Force noted that it was important to encourage balance and variety in housing to meet the housing needs of Burbank's diverse population. To do so two programs are suggested that create incentives for the private sector to assist in the balanced development of housing by incorporating units affordable to various economic segments of the community.

• Program: Adopt Inclusionary Zoning to integrate affordable units within market rate developments.

A regulatory tool adopted by over 75 California jurisdictions, inclusionary zoning increases the supply of affordable housing in conjunction with market rate development by requiring developers to include an established percentage of affordable units within new residential developments. Sensitive to market conditions, inclusionary ordinances are most productive in a strong housing market, such as Burbank, by capitalizing on market demand when market rate development is focused primarily on upper income households.

Inclusionary programs often allow modified development standards and offer financial assistance for the affordable units. Typically, inclusionary programs allow as well one or more of the following alternatives to on-site construction of affordable units to mitigate the financial impact on developers.

• Payment of an affordable housing in-lieu fee¹,
• Dedication of land for affordable housing, or
• Development of affordable housing at another location, such as in partnership with a non-profit developer.

Recommendation: Develop a draft Inclusionary Housing Ordinance and in-lieu fee structure for consideration by City Council. Target a 15 percent affordability requirement, and income targeting to very low, low and moderate-income households.

The Task Force thought it important that, in addition to the 25 percent State-mandated density bonus, an ordinance be adopted setting forth specific development incentives for the provision of affordable units. This Ordinance could work in concert with the Inclusionary Ordinance and could include such incentives as density increases, parking reductions, expedited processing and fee deferrals. The Ordinance would specifically delineate the types of additional regulatory incentives the City would offer, e.g., decreased parking standards, smaller unit sizes, reduced setbacks, and fee reductions/deferrals. The Ordinance could also be used as a tool to encourage development of special needs housing, offering added incentives for the provision of housing for the disabled, seniors, large families, and single-parent households.

Recommendation: Develop a draft Affordable Housing Incentives Ordinance for consideration by City Council that conforms to state density bonus law and defines affordable housing cost. Once adopted, promote the availability of the Ordinance among the development community.

OBJECTIVE 3. FACILITATE MIXED-USE AND IN-FILL DEVELOPMENT

Burbank is a built-out community with virtually no under developed residential land. New housing, though, can be channeled towards the downtown, to underutilized commercial areas and on scattered residential sites, thereby accommodating needed housing while preserving existing neighborhoods and hillside areas. The Redevelopment Agency could assist in assembling sites for development and the City could provide flexible zoning mechanisms in support of mixed-use and in-fill development. The Agency already has begun assembling parcels for development of affordable and mixed-income housing in the South San Fernando Redevelopment Project Area with these projects: the Senior Artists Colony (141 units), Burbank Accessible Apartments (18-unit independent living facility) and the Lance site (33 attached condominiums).

• Program: Site assembly/reuse of existing structures in Downtown for mixed-use development.

In addition to sites identified in the Burbank Center Plan, mixed-use development can also be achieved in the Downtown through Redevelopment Agency acquisition of underutilized properties, and potentially through retrofitting existing commercial buildings as live/work options or artists' lofts. The Burbank Center Plan has been successful in bringing urban housing to the Downtown, thereby contributing to its regeneration as evidenced, for example, by the planned development of Burbank Village Walk on the Old Police Block downtown.

Recommendation: Continue to assist in the assemblage of land for mixed-use development in the Downtown. Integrate affordable units within Redevelopment Agency assisted projects.

• Program: Site assembly along commercial corridors for residential in-fill.

The Task Force concluded that the Burbank's commercial corridors could support residential in-fill and mixed-use development. Today, the older strip commercial uses along these corridors is of marginal quality and, "with the advent of Media Center, Downtown retail and now Empire Center, the economic viability of many of these uses is faltering." The Task Force concluded that integrating residential uses would revitalize Burbank's corridors (such as Burbank and Magnolia Boulevards where residential development is permitted), and that small lot single-family projects in mid-block locations along with commercial and higher density mixed-use developments concentrated at pivotal intersections was the type of housing most appropriate.

Recommendation: As part of 2003 update of the City�s Land Use Element, define appropriate locations and product types for residential and mixed-use in-fill along commercial corridors. Assist with site assembly through the Redevelopment Agency to facilitate in-fill activity in targeted areas in exchange for affordability covenants on a portion of the units.

• Program: Adopt mixed-use zoning standards, including live/work options, and standards for small lot development.

The Task Force felt introducing new zoning tools, such as a mixed-use zone district with standards that complement mixed-use development and varied from the City�s standard zoning regulations, would be better able to facilitate mixed-use development and would be an integral element to spur mixed-use and in-fill development. The Task Force observed mixed-use zoning, coupled with design and development standards that ensured residential and commercial uses were compatible, had already been implemented in many jurisdictions.

The Task Force was informed that developers frequently were required to redesign and seek multiple variances in constructing a small lot single-family housing product in a standard residential zoning designation. Consequently, a small lot in-fill ordinance with accompanying standards is proposed by the Task Force to accommodate in-fill housing along commercial corridors, as well as scattered sites within residential neighborhoods.

Recommendation: Direct the Planning Division to draft a mixed-use development ordinance, including provisions for live/work units, and a small lot in-fill ordinance for review by the Planning Board and City Council.

• Program: Buy-down of debt on existing apartment buildings in exchange for affordability covenants.

Under this program, the Agency would extend a loan to reduce or "buy-down" the mortgage debt on an owner�s existing multifamily property in exchange for affordability covenants. The owner realizes a greater cash flow (reduced debt) to offset reduced rental income resulting from the affordability covenants attached onto the owner�s property. Additionally, the owner could divert a portion of the Agency�s assistance for necessary repairs and improvements. The Task Force liked the concept of this program, and felt it offered particular potential when multi-family properties are sold to a new owner and rents are typically increased to cover debt.

Recommendation: Direct Housing Division staff to research Debt Buy-Down programs implemented in other jurisdictions, and discuss the logistics of structuring of such a program with local lenders and realtors. Present recommended program guidelines to City Council.

The Task Force recognizes the critical importance of the Section 8 Program in extending housing assistance payments on behalf of very low-income tenants to reduce rents to an affordable rate. The Task Force also noted that Section 8 assistance is particularly essential in the current environment of escalating rents evidenced by the Housing Authority�s allocation of 1,014 Section 8 vouchers against a demand of 9,000 households on the waiting list.

Recommendation: Pursue additional Section 8 funding allocations as they become available, and continue to provide priority assistance to households currently residing or working in Burbank.

• Program: Acquisition/rehabilitation in focus neighborhoods.

For five years, the Agency has funded the Burbank Housing Corporation (BHC) to acquire, rehabilitate and operate rental properties within certain geographically targeted areas or focus neighborhoods. Agency assistance is provided in exchange for covenants that are placed on properties acquired by the BHC to ensure long-term affordability and strong property management. In the Elmwood and Lake/West Verdugo focus neighborhoods, selective acquisition was combined with development of activity centers to service-enrich these areas.

The Task Force recommends the continued partnership between the Agency and BHC to revitalize neighborhoods and particularly the integration of community-serving uses. The Task Force also supports the expansion of current focus area boundaries as appropriate, and identified a potential new Focus Area at Lake Street west of Alameda Avenue for consideration.

Recommendation: Continue to support acquisition and rehabilitation activities in Focus Neighborhoods, with an emphasis on community building through integration of neighborhood serving uses. Explore expansion of Focus Areas, and the addition of a new area at Lake/Alameda as appropriate.

The Task Force encourages the continued use of Agency funds to extend rehabilitation assistance to private property owners. This program consists of the following components: a) deferred loans that provide below-market interest rates (BMIR) to lower-income owner-occupants of single-family dwellings that postpone the payment until the property is conveyed; b) amortized loans that extend BMIR financing to moderate income owner-occupants of single-family dwellings; and c) multi-family loans offering BMIR deferred loans that are partially forgiven at the end of the 15-year period in exchange for 25 percent of the units being affordable to lower-income households. The Agency also funds grants to very low-income owner-occupants for minor rehabilitation to single-family dwellings.

Recommendation: Continue to implement an active residential rehabilitation program as a key tool to sustaining existing neighborhoods. Consistent with the Agency�s Implementation Plan, seek to provide assistance to approximately 40-50 households annually.

The Task Force is recommending a range of programs aimed at providing homeownership to all income levels, including site assembly in the downtown, on commercial corridors and on scattered residential sites to support development of mixed income ownership housing, as well as adoption of an Inclusionary Housing Ordinance to provide affordable ownership opportunities in within market rate developments. Through site assembly and other assistance, it was noted that the Agency is currently assisting Burbank Cottages (20 single-family units/10 moderate-income), Riverside Drive (20 condos & townhomes/10 moderate-income), Lance Site (33 townhomes/10 moderate-income), and Burbank Village Walk (140 condos/14 moderate- income).

A potential constraint discussed with the Task Force regarding the use of Agency housing funds concerns limitations imposed by State legislation (AB 637). The expenditure of housing funds must now be made in at least the same proportion as the total number of housing units needed for persons of very low, low and moderate-income as defined by the regional housing needs contained in the Housing Element. Based upon Burbank�s Housing Element, 36 percent of all units produced should be affordable to moderate-income households. This would translate to restricting housing funds so that no more than 36 percent of the funds are used for moderate-income households, the typical target population for homeowner programs.

Recommendation: Continue to assist in the assemblage of land in support of mixed income homeownership developments within the parameters established under AB 637.

• Program: Homeownership assistance to low and moderate-income purchasers.

The Task Force also supports the continuation of another Agency program, Mortgage Assistance Program (MAP), which provides homeownership assistance through low-interest second mortgages. The MAP is designed to assist low and moderate-income families with the monies necessary to bridge the gap between the mortgage amount a homebuyer can qualify for and the actual purchase price of a single-family detached home, townhouse, or condominium in Burbank.

Recommendation: Continue to offer ownership assistance on a citywide basis, as well as in conjunction with development of Agency-assisted ownership housing. Develop recommended refinements to the MAP program to enhance utilization for consideration by the Agency. Consistent with the Agency�s Implementation Plan, seek to assist 20 households annually.

The Task Force also recommends the promotion of affordable and accessible housing to special needs groups, such as the disabled, seniors, large families, single-parent households and victims of domestic violence. These segments of Burbank�s population face greater obstacles in obtaining adequate housing due to their special housing needs and, as such, the Task Force has put forth the following programs in support of this population.

• Program: Provide housing for special needs populations, including the disabled, large families, single-parent households, seniors, and victims of domestic violence.

Construction of special needs housing through the Affordable Housing Incentives Ordinance outlined earlier and through Agency financial assistance and site assembly combined with the integration of community-serving uses with housing can also provide needed support services to allow special needs populations to live independently. Currently, the Agency is assisting in the development of the Burbank Accessible Apartments, Burbank Cottages and Childcare Center (three-bedroom, large family units) and the Senior Artists Colony.

Other special needs housing, such as transitional housing facilities for victims of domestic violence, are better suited for the re-use of existing structures, where the Agency could extend rehabilitation. Construction incentives and conversion of bedrooms through acquisition and rehabilitation activities both can assist large family renters.

Recommendation: Continue to support the provision of special needs housing through new construction and re-use of existing structures, and through coordination with non-profit housing providers.

While newly constructed and substantially rehabilitated housing are subject to the Americans with Disabilities Act (ADA) requirements, Burbank�s rental housing is largely inaccessible to persons with physical disabilities, limiting housing options for many disabled persons and resulting in others residing in housing which inadequately meets their physical needs. The Agency funds the Home Secure Program administered by Jewish Family Services, which provides free home safety and security services to homeowners and renters on fixed incomes, including grab bars, hand-held shower hoses, and adjustable shower chairs. The Task Force suggested that the Agency could also provide funding for accessibility improvements, installation of ramps, widened doorways and lowered countertops.

Recommendation: Develop program guidelines for expansion of the Agency�s current Rehabilitation Program to include assistance for accessibility improvements, and present to Council for consideration. Contact Jewish Family Services regarding potential expansion of their Home Secure Program to encompass Agency funded accessibility improvements.

A Blue Ribbon Task Force Recommendations