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HomeMy WebLinkAboutStaff Report 14867 City of Palo Alto (ID # 14867) City Council Staff Report Report Type: Action Items Meeting Date: 12/12/2022 City of Palo Alto Page 1 Summary Title: Action Item: ADU Code Changes to PAMC Title: PUBLIC HEARING/LEGISLATIVE: Adoption of Amendments to Palo Alto Municipal Code Chapter 18.09, Accessory and Junior Accessory Dwelling Units due to State Law Changes and Direction from the California Department of Housing and Community Development. Environmental Assessment: Exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21080.17 and CEQA Guidelines sections 15061(b)(3), 15301, 15302 and 15305. Planning and Transportation Commission Recommended Approval of the Ordinance. From: City Manager Lead Department: Planning and Development Services Recommendation Staff recommends the City Council adopt the attached Ordinance (Attachment A) amending Palo Alto Municipal Code Title18 (Zoning) regulations for Accessory Dwelling Units (ADUs) and Junior Accessory Dwelling Units (JADUs) to reflect changes in state law and direction from the California Department of Housing and Community Development (HCD). Report Summary/Background On October 26, 2020, the City Council adopted the updated Palo Alto’s Accessory Dwelling Unit and Junior Accessory Dwelling Unit (ADU and JADU) Ordinance. These were consolidated into Palo Alto Municipal Code (PAMC) Chapter 18.09. On October 26, 2020, Council also directed staff to continue working with stakeholders and to present any additional changes to the Planning and Transportation Commission (PTC). The PTC held multiple hearings to discuss potential ADU/JADU code changes, and the PTC staff reports, meeting minutes, and videos are viewable on the City’s PTC webpages.1 1 Link to 2022 PTC Staff reports, meeting minutes, and videos https://www.cityofpaloalto.org/Departments/Planning-Development-Services/Planning-and-Transportation- City of Palo Alto Page 2 In September 2022, the Governor signed the California State legislature’s three new bills regarding ADU/JADU regulations (SB897, AB2221, and AB157). The laws will go into effect on January 1, 2023; they are intended to incentivize housing unit development. In addition, there was a Budget Act that appropriates $100 million to bolster CalHFA’s ADU grant program that provides up to $40,000 for low- and moderate-income homeowners to cover pre-development costs. On September 28, 2022, the PTC recommended Council approve a draft ordinance incorporating the new state legislation and direction from HCD as well as other changes the PTC discussed in public hearings. The attached ordinance, however, is limited only to the code updates necessary to comply with the new state law and direction from HCD. The other policy recommendations will follow early next year. The reason staff is separating these ordinances is to focus on the more time sensitive state-mandated changes to avoid having the City’s local ADU/JADU ordinance invalidated, which arguably would be the case if the City does not adopt an ordinance by January 1, 2023. The attached draft Ordinance (Attachment A) enables the Council to adopt the State’s 2022 ADU legislation. Discussion This staff report touches on the staff response to a California Department of Housing and Community Development (HCD) letter received in late 2021, as well as describing the 2022 State legislation regarding ADUs and JADUs. Staff Response to HCD Letter On December 23, 2021, the City received a letter from HCD regarding the ordinance the City adopted in November 2020 (Attachment B). HCD raised 12 issues with the City’s ordinance where it thought the ordinance conflicted with state law or required further clarification. On February 3, 2022, City staff met with HCD staff to discuss HCD’s comments and concerns as well as to explain the structure and intent of the language incorporated into the City’s ordinance. Following that discussion, City staff provided detailed responses to the HCD letter, indicating areas where the City would incorporate changes and where staff required clarification (Attachment C). Staff has sought updates from HCD on this request for additional feedback over the past year but has not received HCD’s response. Many of the HCD’s changes were minor clarifications, which appear in the draft ordinance as noted in comment bubbles. In many cases, the proposed adjustments clarify existing policy to Commission-PTC/Current-PTC-Agendas-Minutes; the most recent PTC hearing was September 28, 2022. Earlier PTC hearings in 2022 were July 13, 2022 and August 10, 2022. City of Palo Alto Page 3 provide assurance to the state and the public that the City’s ordinance should be interpreted in a manner consistent with state law. Other items (such as #3, #4, and #5 in the HCD letter) are more significant changes to City policy, where February 2022 meeting left staff uncertain about the HCD’s direction. Staff awaits further clarification from HCD before proposing an ordinance change for those items. While staff believes that there are strong arguments in support of the City’s position on these issues, it is possible that HCD’s eventual response will require further modifications to the ordinance. Given the uncertainty around when the City can expect a detailed response from HCD, staff recommends proceeding with the ordinance update, though further ordinance revisions may be required based on any additional HCD feedback received. Inclusion of 2022 State ADU Legislation The Governor signed the following three bills pertaining to ADUs: • SB 897 allows two-story ADUs in some places, prevents local governments from posting unnecessary notices, and prevents a local government from changing the Group R occupancy status as that relates to building codes, among other important changes. • AB 2221 prevents local governments from imposing front setbacks, establishes a 60-day timeline for a complete review of ADUs that are denied, and makes other important changes noted below in the AB 2221 summary section. • AB 157, a late addition to budget trailer bills, requires CalHFA to convene a working group of experts to recommend next-phase updates to CalHFA's ADU grant program so that more homeowners can benefit. Two of these bills, now laws, are incorporated into provisions of the attached draft ordinance - SB897 and AB2221. AB 2221 and SB 897 both amended Government Code section 65852.2. AB 2221 was chaptered at 650, and SB 897 was chaptered at 664. SB 8972 (GC 65852.2 amendment @664) Requires That: • The City must allow a height of 18 feet for a detached ADU on a lot with an existing or proposed single-family or multifamily dwelling unit that is within one-half mile walking distance of a major transit stop or a high-quality transit corridor3, as those terms are defined in Section 21155 of the Public Resources Code. An additional two feet in height shall be provided to accommodate a roof pitch on an ADU that is aligned with the roof pitch of the primary dwelling unit. • The City must allow a height of 18 feet for a detached ADU on a lot with an existing or proposed multifamily, multi-story dwelling, regardless of proximity to a transit stop or 2 Link to Summary of SB897: https://legiscan.com/CA/text/SB897/2021 3 See Attachment D for a map of the major transit stops and high-quality transit corridor City of Palo Alto Page 4 high-quality transit corridor. This would not affect properties with multifamily, single- story dwellings. • The City must allow a height of 25 feet or the height limitation in the underlying zone district that applies to the primary dwelling, whichever is lower, for an ADU that is attached to a primary dwelling. The ADUs shall not exceed two stories in height. • The City cannot require modification to an existing, noncomplying, multi-family residential dwelling to satisfy the height limit or rear or side setback of four feet for an ADU. • The City cannot reject an ADU application because an existing multi-family residential dwelling exceeds the maximum height or rear or side setbacks of less than four feet. • The City cannot impose parking standards on an ADU that is included in an application to create a new single-family dwelling unit or new multi-family residential dwelling on the same lot, provided the ADU meets other specified requirements. • Enclosed uses within the proposed or existing single-family residence, such as attached garages, are considered part of the proposed or existing single-family residence. • A JADU that does not include a separate bathroom must include a separate entrance from the main entrance to the structure, with an interior entry to the main living area. • The City cannot deny an application for JADU due to the correction of nonconforming zoning conditions or building violations, or unpermitted structures that do not present a threat to public health and safety and are not affected by the construction of the JADU. • The City cannot deny a permit for an unpermitted ADU constructed before January 1, 2018, because, among other things, the unit is in violation of building standards or state or local standards applicable to ADUs, unless the local agency makes a finding that correcting the violation is necessary to protect the health and safety of the public or occupants of the structure. This prohibition does not apply to a building that is deemed substandard under specified provisions of law. AB 22214 (GC 65852.2 amendment @650): • Clarifies that an ADU may be attached to or located within a detached garage for the primary dwelling. • Specifies that the permitting agency action must be approval or denial of the application. If a permitting agency denies an application for an ADU or JADU, the law requires a permitting agency to return in writing a full set of comments to the applicant with a list of items that are defective or deficient and a description of how the application can be remedied by the applicant within the same timeframes. The law defines “permitting agency” for its purposes. 4 Link to Summary of AB2221: https://legiscan.com/CA/text/AB2221/2021 City of Palo Alto Page 5 • Prohibits a local agency from enforcing front setbacks, where such setbacks would preclude the creation of an ADU of at least 800 square feet, with four-foot side and rear setbacks and 16 feet in height. Significant Changes The most significant effects of these state law changes pertain to the increased height allowances for attached ADUs and detached ADUs located within a half-mile distance from high-quality transit in the City. In Palo Alto, these areas primarily occur near the University and California Avenue Caltrain Stations and along El Camino Real, as shown in Attachment D. The increased height in these areas will inevitably create greater privacy and massing impacts on adjacent properties that the City is unable to control or prevent. This is, however, consistent with the approach the state has taken to encourage ADU development in California and will likely continue to be expanded in the future. While other new state laws seek to limit a local jurisdiction’s ability to require front yard setbacks, staff believe that the current phrasing built into the state code only provides that ability as a last resort to homeowners, when the ADU follows a four-foot side and rear yard setback, but they would still be unable to create minimum sized 800 square foot ADU. Staff does not anticipate that this will become a prevalent issue. Many of the state law revisions do not affect the City’s ADU/JADU ordinance because they are requirements the City already established in the code and practices staff follow for processing ADU/JADU applications. Quarterly ADU report dated June 20, 2022 The Council received a quarterly report on ADUs5. In the report, the average size of ADUs was reported to be around 552 square feet which is an increase largely associated with the additional flexibility the State provides for minimum sizes of second units that homeowners can develop by right. Environmental Review The adoption of the Draft Ordinance would be exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section 21080.17 and CEQA Guidelines sections 15061(b)(3), 15301, 15302 and 15305 because it meets requirements related to accessory dwelling units as established in Government Code Section 65852.2, and these changes are also likely to result in few additional dwelling units dispersed throughout the City. As such, it can be seen with certainty that the proposed action will not have the potential for causing a significant effect on the environment. 5 Link to June 2022 quarterly ADU report to Council: https://www.cityofpaloalto.org/files/assets/public/agendas- minutes-reports/agendas-minutes/city-council-agendas-minutes/2022/20220620/20220620pccsm-amended-final- final.pdf#page=820 City of Palo Alto Page 6 Public Notification, Outreach & Comments The PAMC requires notice of this public hearing to be published in a local paper and mailed to owners and occupants of property within 600 feet of the subject property at least 10 days in advance. Notice of a public hearing for this project was published in the Daily Post on December 2, which is 10 days in advance of the meeting. Attachments: ATTACHMENT A - Ordinance Amending Title 18 (Zoning) of the PAMC to Amend Requirements Relating to Accessory Dwelling Units and Junior Accessory Dwelling Units (PDF) ATTACHMENT B - HCD Letter on ADU Ordinance (PDF) ATTACHMENT C - Staff Response to HCD (PDF) ATTACHMENT D - Half Mile Buffer from High Quality Transit (PDF) *NOT YET APPROVED*  1  0160097_20221128_ay_16  Ordinance No. _____    Ordinance of the Council of the City of Palo Alto Amending Title 18 (Zoning) of  the Palo Alto Municipal Code to Amend Requirements Relating to Accessory  Dwelling Units and Junior Accessory Dwelling Units      The Council of the City of Palo Alto does ORDAIN as follows:    SECTION 1.  Findings and Declarations.  The City Council finds and declares as follows:    A. Housing in California is increasingly unaffordable. In 2017, the average  California home cost about 2.5 times the national average home price and the monthly rent  was 50% higher than the rest of the nation. Rents in San Francisco, San Jose, Oakland, and Los  Angeles are among the top 10 most unaffordable in the nation.    B. Housing in Palo Alto is especially unaffordable. The average Palo Alto home  currently costs about 8 times the national average home price and the monthly rent is about  2.5 times the national average.    C. Palo Alto has a jobs/housing imbalance. When addressing this imbalance, the  City must not only provide housing but also ensure affordability.    D. Assembly Bill (“AB”) 2221 and Senate Bill (“SB”) 897  (“State ADU Law”) pertain to  accessory dwelling units (“ADUs”) and junior accessory dwelling units (“JADUs”) and were  approved by the California Legislature in 2022 and signed by the Governor on September 30,  2022.  These bills, codified primarily in California Government Code sections 65952.2 and  65952.22, are intended to spur the creation of lower cost housing by easing regulatory barriers  to the creation of ADUs and JADUs. The City adopted Ordinance 5507 (now Palo Alto Municipal  Code Chapter 18.09), which brought the City’s municipal code into conformance with state laws  AB 68, 587, 671 and 881, and SB 13.   SB 897 allows two‐story ADUs in some places, prevents local governments from  posting unnecessary notices, and prevents a local government from changing the  Group R occupancy status as that relates to building codes, among other  important changes.   AB 2221 adds front setbacks to the list of standards that must give way to permit  an 800sf ADU, establishes a 60‐day timeline for complete review of ADUs that are  denied, and makes other important changes.    E. This ordinance is adopted to incorporate changes in state law that have occurred  since the adoption of Ordinance 5507, respond to comments the City has received from the  California Department of Housing and Community Development regarding its ADU regulations,  respond to additional policies advocated by members of the public, and issues staff has noticed  *NOT YET APPROVED*  2  0160097_20221128_ay_16  when reviewing permits. This ordinance is also adopted to establish a program for deed‐ restricted affordable ADU/JADUs.    SECTION 2.  Chapter 18.09 (Accessory Dwelling Units and Junior Accessory Dwelling Units)  of Title 18 (Zoning) of the Palo Alto Municipal Code (“PAMC”) is amended to read as follows  (additions underlined and deletions struck‐through):    18.09.010 Purpose    The intent of this Chapter is to provide regulations to accommodate accessory and  junior accessory dwelling units (ADU/JADU), in order to provide for variety to the city's housing  stock and additional affordable housing opportunities. These units shall be separate, self‐ contained living units, with separate entrances from the main residence, whether attached or  detached. The standards below are provided to minimize the impacts of units on nearby  residents and throughout the city, and to assure that the size and location of such dwellings is  compatible with the existing or proposed residence(s) on the site and with other structures in  the area.    18.09.020 Applicable Zoning Districts    The establishment of an accessory dwelling unit is permitted in zoning districts when  single‐family or multi‐family residential is a permitted land use. The development of a single‐ family home, ADU, and/or a JADU on a lot that allows for single‐family development shall not be  considered a multifamily development pursuant to PAMC Section 18.04.030, nor shall they  require Architectural Review pursuant to other sections of Chapter 18.    18.09.030 Units Exempt from Generally Applicable Local Regulations    (a) Government Code section 65852.2, subdivision (e) provides that certain units shall  be approved notwithstanding state or local regulations that may otherwise apply. The following  types of units shall be governed by the standards in this section. In the event of a conflict between  this section and Government Code section 65852.2, subdivision (e), the Government Code shall  prevail.      i. An ADU and or JADU within the existing space of a single‐family dwelling or an  ADU within the existing space of an accessory structure (i.e. conversion without  substantial addition).  ii. An ADU and or JADU within the proposed space of a single‐family dwelling.  iii. A detached, new construction ADU on a lot with a proposed or existing single‐ family dwelling, provided the ADU does not exceed 800 square feet, sixteen feet  in height, or four‐foot side and rear (i.e. interior) setbacks.  iv. ADUs created by conversion of portions of existing multi‐family dwellings not used  as livable space.  v. Up to two detached ADUs on a lot with an existing multi‐family dwelling.  Commented [SG1]: Response to HCD item #2  Commented [SG2]: Response to HCD item #2  *NOT YET APPROVED*  3  0160097_20221128_ay_16    (b) The Development Standards for units governed by this section are summarized in  Table 1. Regulations set forth in section 18.09.040 do not apply to units created under 18.09.030.  The minimum and maximum sizes indicated in Table 1 do not prohibit units that are greater than  800 square feet. These sizes simply serve to distinguish when a unit transitions from regulations  set forth in Table 1 and section 18.09.030 to regulations set forth in Table 2 and section  18.09.040.     Table 1: Development Standards for Units Described in Government Code Section 65852.2(e)   Single‐Family Multi‐Family   Conversion of  Space Within an  the Existing  Space of a  Single‐Family  Home or  Accessory  Structure  Construction of  Attached ADU  Within the  Proposed Space  of a Proposed  Single‐Family  Home  New  Construction of  Detached ADU   Conversion of  Non‐Habitable  Space Within  Existing Multi‐ family Dwelling  Structure  Conversion or  Construction of  Detached(4) ADU  Number  of Units  Allowed  1 ADU and 1 JADU   25% of the  existing units  (at least one)  2  Minimum  size(1) 150 sf  Maximum  size(1) N/A2 800 sf N/A  Setbacks  N/A, if condition  is sufficient for  fire and safety  Underlying zone  standard for  Single Family  Home    (ADU must be  within  allowable space  of Single‐Family  Home)(7)  4 feet from side  and rear lot  lines;  underlying  zoning for front  setback  N/A  4 feet from side  and rear lot  lines; underlying  zoning for front  setback  Daylight  Plane N/A N/A  Maximum  Height(3) N/A 16(5)3 N/A 16(4)(5)(6)  Parking None  State Law  Reference 65852.2(e)(1)(A) 65852.2(e)(1)(A) 65852.2(e)(1)(B) 65852.2(e)(1)(C) 65852.2(e)(1)(D)    (1) Lofts where the height from the floor level to the underside of the rafter or finished roof  surface is 5' or greater shall count towards the unit’s floor area.  (2) Up to 150 sf may be added for the purpose of ingress and egress only.  Commented [SG3]: Response to HCD item #5, #10, #11,  #12  Commented [SG4]: Response to HCD item #1  *NOT YET APPROVED*  4  0160097_20221128_ay_16  (3) Units built in a flood zone are not entitled to any height extensions granted to the primary  dwelling.  (4) Units must be detached from existing primary dwellings but may be attached to each  other.  (5) A height of 18 feet for a detached ADU on a lot with an existing or proposed single family  or multifamily dwelling unit that is within one‐half of one mile walking distance of a major  transit stop or a high‐quality transit corridor, as those terms are defined in Section 21155  of the Public Resources Code. An additional two feet in height shall be provided to  accommodate a roof pitch on an ADU that is aligned with the roof pitch of the primary  dwelling unit.  (6) A height of 18 feet for a detached ADU on a lot with an existing or proposed multifamily,  multistory dwelling.  (7) A height of 25 feet or the height limitation in the underlying zone district that applies to  the primary dwelling, whichever is lower, for an ADU that is attached to a primary  dwelling. These ADUs shall not exceed two stories in height.    (c) Development standards stated elsewhere in this Section or Title 18, including  standards related to FAR, lot coverage, and privacy, are not applicable to ADUs or  JADUs that qualify for approval under this section.    (d) The establishment of accessory dwelling units and junior accessory dwelling units  pursuant to this section shall not be conditioned on the correction of non‐conforming  zoning conditions; provided, however, that nothing in this section shall limit the  authority of the Chief Building Official to require correction of building standards  relating to health and safety.    (e) The installation of fire sprinklers shall not be required in an accessory dwelling unit if  sprinklers are not required for the primary residence. Nothing in this section shall  preclude the Fire Marshal from accepting fire sprinklers as an alternative means of  compliance with generally applicable fire protection requirements.    (f) Rental of any unit created pursuant to this section shall be for a term of 30 days or  more.    (g) Attached units shall have independent exterior access from a proposed or existing  single‐family dwelling. Except for JADUs, attached units shall not have an interior  access point to the primary dwelling (e.g. hotel door or other similar  feature/appurtenance).    (h) Conversion of an existing accessory structure pursuant to Government Code section  65852.2(e)(1)(A) may include reconstruction in‐place of a non‐conforming structure,  so long as the renovation of reconstruction does not increase the degree of non‐ compliance, such as increased height, envelope, or further intrusion into required  setbacks.  Commented [SG5]: SB 897 and AB 2221 Changes  *NOT YET APPROVED*  5  0160097_20221128_ay_16    (i) Street addresses shall be assigned to all units prior to building permit final to assist in  emergency response.    (j) The unit shall not be sold separately from the primary residence.    (k) Replacement parking is not required when a garage, carport, or covered parking  structure is converted to, or demolished in conjunction with the construction of, an  ADU.    (l) JADUs shall comply with the requirements of Section 18.09.050.    18.09.040 Units Subject to Local Standards    (a) This section shall govern applications for ADUs and JADUs that do not qualify for  approval under section 18.09.030 and for which the City may impose local standards  pursuant to Government Code section 65852.2, subdivisions (a) through (d). Nothing  in this section shall be interpreted to prohibit an ADU of up to 800 square feet, at the  heights stated in Table 2, with a four foot side and rear setbacks.    (b) The Development Standards for units governed by this section are provided in Table  2. These regulations do not limit the height of existing structures converted into  ADU/JADUs unless the envelope of the building is proposed to be modified beyond  any existing legal, non‐conforming condition.    Table 2: All other Units   Attached Detached JADU  Number of Units  Allowed1 1 1  Minimum size 150 sf  Maximum size  900 sf (1,000 sf for two  or more bedrooms);  no more than 50% of  the size of the single‐ family home  900 sf (1,000 sf for  two or more  bedrooms)  500 sf  Setbacks 4 feet from side and rear lot lines;  underlying zone standard for front setback  Daylight Plane   Initial Height 8 feet at lot line  Angle 45 degrees  Maximum Height3     Res. Estate (RE)  30 feet   Open Space (OS)  25 feet   Commented [SG6]: Response to HCD item #6, #9; SB 897  change re height  Commented [SG7]: Response to HCD item #5  *NOT YET APPROVED*  6  0160097_20221128_ay_16  All other eligible  zones  16 feet(5)(6)(7)   Parking None  Square Footage  Exemption Up to 800 sf(4) Up to 500 sf(4)    (1) An attached or detached ADU may be built in conjunction with a JADU on a lot with an  existing or proposed single family home. One attached or detached ADU may be built in  conjunction with an existing or proposed multifamily building.  (2) Lofts where the height from the floor level to the underside of the rafter or finished roof  surface is 5' or greater shall count towards the unit’s floor area.  (3) Units built in a flood zone are not entitled to any height extensions granted to the primary  dwelling.  (4) Lots with both an ADU and a JADU may exempt a maximum combined total of 800 square  feet of the ADU and JADU from FAR, Lot Coverage, and Maximum House Size calculations.  (5) A height of 18 feet for a detached ADU on a lot with an existing or proposed single family  or multifamily dwelling unit that is within one‐half of one mile walking distance of a major  transit stop or a high‐quality transit corridor, as those terms are defined in Section 21155  of the Public Resources Code. An additional two feet in height shall be provided to  accommodate a roof pitch on an ADU that is aligned with the roof pitch of the primary  dwelling unit.  (6) A height of 18 feet for a detached ADU on a lot with an existing or proposed multifamily,  multistory dwelling.  (7) A height of 25 feet or the height limitation in the underlying zone district that applies to  the primary dwelling, whichever is lower, for an ADU that is attached to a primary  dwelling. These ADUs shall not exceed two stories in height.    (c) A single‐family dwelling shall exist on the lot or shall be constructed on the lot in  conjunction with the construction of an ADU/JADU.    (d) ADU and/or JADU square footage shall not be included in FAR, Lot Coverage, and  Maximum House Size calculations for a lot with an existing or proposed single family  home, up to the amounts stated in Table 2. ADU and/or JADU square footage in excess  of the exemptions provided in Table 2 shall be included in FAR, Lot Coverage, and  Maximum House Size calculations for the lot.    (e) Attached units shall have independent exterior access from a proposed or existing  single‐family dwelling.  Except for JADUs, attached units shall not have an interior  access point to the primary dwelling (e.g. hotel door or other similar  feature/appurtenance).    (f) No protected tree shall be removed for the purpose of establishing an accessory  dwelling unit unless the tree is dead, dangerous or constitutes a nuisance under  Commented [SG8]: Response to HCD direction.  Commented [SG9]: SB 897 and AB 2221 Changes  *NOT YET APPROVED*  7  0160097_20221128_ay_16  Section 8.04.050. Any protected tree removed pursuant to this subsection shall be  replaced in accordance with the standards in the Tree Technical Manual.    (g) For properties listed in the Palo Alto Historic Inventory, the California Register of  Historical Resources, the National Register of Historic Places, or considered a historic  resource after completion of a historic resource evaluation, compliance with the  appropriate Secretary of Interior’s Standards for the Treatment of Historic Properties  shall be required.    (h) Noise‐producing equipment such as air conditioners, water heaters, and similar  service equipment. All such equipment shall be insulated and housed, except that the  planning directorDirector may permit installation without housing and insulation,  provided that a combination of technical noise specifications, location of equipment,  and/or other screening or buffering will assure compliance with the city’s Noise  Ordinance at the nearest property line. All service equipment must meet the city’s  Noise Ordinance in Chapter 9.10 of the Municipal Code.    (i) Setbacks  1. Detached units shall maintain a minimum three‐foot distance from the  primary unit, measured from the exterior walls of structures.  2. No basement or other subterranean portion of an ADU/JADU shall encroach  into a setback required for the primary dwelling.  3. Projections, including but not limited to windows, doors, mechanical  equipment, venting or exhaust systems, are not permitted to encroach into  the required setbacks, with the exception of a roof eave of up to 2 feet.    (j) Design  1. Except on corner lots, the unit shall not have an entranceway facing the same  lot line (property line) as the entranceway to the main dwelling unit unless the  entranceway to the accessory unit is located in the rear half of the lot. Exterior  staircases to second floor units shall be located toward the interior side or rear  yard of the property.  2. Privacy  A. Second story doors and decks shall not face a neighboring dwelling  unit. Second story decks and balconies shall utilize screening barriers  to prevent views into adjacent properties. These barriers shall provide  a minimum five‐foot, six‐inch, screen wall from the floor level of the  deck or balcony and shall not include perforations that would allow  visibility between properties.  B. Second story windows, excluding those required for egress, shall have  a five‐foot sill height as measured from the second‐floor level, or utilize  obscured glazing on the entirety of the window when facing adjacent  properties.  Second story egress windows shall utilize obscured glazing  on the entirety of the windows which face adjacent properties.  *NOT YET APPROVED*  8  0160097_20221128_ay_16  C. Second story windows shall be offset from neighbor’s windows to  maximize privacy.    (k) Parking  1. Replacement parking is not required when a garage, carport, or covered  parking structure is converted to, or demolished in conjunction with the  construction of, an ADU.  2. Replacement parking is required when an existing attached garage is  converted to a JADU. These replacement spaces may be provided as  uncovered spaces in any configuration on the lot including within the front or  street side yard setback for the property.  A. The Director shall have the authority to modify required replacement  parking spaces by up to one foot in width and length upon finding that  the reduction is necessary to accommodate parking in a location  otherwise allowed under this code and is not detrimental to public  health, safety or the general welfare.  B. Existing front and street side yard driveways may be enlarged to the  minimum extent necessary to comply with the replacement parking  requirement above. Existing curb cuts shall not be altered except when  necessary to promote public health, safety or the general welfare.  3. When parking is provided, the unit shall have street access from a driveway in  common with the main residence in order to prevent new curb cuts, excessive  paving, and elimination of street trees, unless separate driveway access will  result in fewer environmental impacts such as paving, grading or tree removal.  4. If covered parking for a unit is provided in any district, the maximum size of the  covered parking area for the accessory dwelling unit is 220 square feet. This  space shall count towards the total floor area for the site but does not  contribute to the maximum size of the unit unless attached to the unit.    (l) Miscellaneous requirements  1. Street addresses shall be assigned to all units prior to building permit final to  assist in emergency response.    2. The unit shall not be sold separately from the primary residence.    3. Rental of any unit created pursuant to this section shall be for a term of 30  days or more.    4. The installation of fire sprinklers shall not be required in an accessory dwelling  unit if sprinklers are not required for the primary residence. Nothing in this  section shall preclude the Fire Marshal from accepting fire sprinklers as an  alternative means of compliance with generally applicable fire protection  requirements.    *NOT YET APPROVED*  9  0160097_20221128_ay_16  18.09.050 Additional Requirements for JADUs    (a) A junior accessory dwelling unit shall be created within the walls of an existing or  proposed primary dwelling.    (b) The junior accessory dwelling unit shall include an efficiency kitchen, requiring the  following components: A cooking facility with appliances, and; food preparation  counter and storage cabinets that are of reasonable size in relation to the size of the  junior accessory dwelling unit.    i. A cooking facility with appliances shall mean, at minimum a one burner  installed range, an oven or convection microwave, a 10 cubic foot refrigerator  and freezer combination unit, and a sink that facilitates hot and cold water.  ii. A food preparation counter and storage cabinets shall be of reasonable size in  relation to a JADU if they provide counter space equal to a minimum 24‐inch  depth and 36‐inch length.    (c) For the purposes of any fire or life protection ordinance or regulation or for the  purposes of providing service for water, sewer, or power, a junior accessory dwelling  unit shall not be considered a separate or new unit.    (d) The owner of a parcel proposed for a junior accessory dwelling unit shall occupy as a  primary residence either the primary dwelling or the junior accessory dwelling.  Owner‐occupancy is not required if the owner is a governmental agency, land trust,  or housing organization.    (e) Prior to the issuance of a building permit for a junior accessory dwelling unit, the  owner shall record a deed restriction in a form approved by the city that includes a  prohibition on the sale of the junior accessory dwelling unit separate from the sale of  the single‐family residence, requires owner‐occupancy consistent with subsection (d)  above, does not permit short‐term rentals, and restricts the size and attributes of the  junior dwelling unit to those that conform with this section.    SECTION 3.    Section 18.10.030 (Land Uses) of Chapter 18.10 (Low‐Density Residential) of Title 18  (Zoning) of the Palo Alto Municipal Code (“PAMC”) is amended to read (additions underlined,  deletions struck‐through, and omissions noted with bracketed ellipses):    18.10.030   Land Uses    Table 1 shows the permitted and conditionally permitted uses for the low‐density residential  districts.        *NOT YET APPROVED*  10  0160097_20221128_ay_16  TABLE 1  PERMITTED AND CONDITIONALLY PERMITTED LOW‐DENSITY RESIDENTIAL USES    [P = Permitted Use ‐‐ CUP = Conditional Use Permit Required]     R‐E R‐2 RMD Subject to  Regulations in:  ACCESSORY AND SUPPORT USES  [. . .] [. . .] [. . .] [. . .] [. . .]  Accessory Dwelling  Units  P P(2) P(2) 18.0942.040  Junior Accessory  Dwelling Units  P P(2) P(2) 18.0942.040  [. . .] [. . .] [. . .] [. . .] [. . .]  Footnotes:  (1) Sale of Agricultural Products: No permanent commercial structures for the sale or  processing of agricultural products are permitted.  (2) Junior Accessory Dwelling Units in R‐2 and RMD Zones: An accessory dwelling unit or a A  Junior Accessory Dwelling Unit is permitted only in conjunction with a single family residence,  subject to the provisions of Chapter 18.09.associated with a single‐family residence on a lot in  the R‐2 or RMD zones is permitted, subject to the provisions of Section 18.42.040, and such  that no more than two units result on the lot.  [. . .]  (4) Two Unit Development Pursuant to California Government Code Section 65852.21 (SB 9,  2021): Construction of two units is permitted on an RE‐zoned lot, subject to the regulations in  Section 18.42.180 .    SECTION 4.    Section 18.12.030 (Land Uses) of Chapter 18.12 (Single‐Family Residential District)  of Title 18 (Zoning) of the Palo Alto Municipal Code (“PAMC”) is amended to read (additions  underlined, deletions struck‐through, and omissions noted with bracketed ellipses):    18.12.030   Land Uses    The permitted and conditionally permitted uses for the single family residential districts are  shown in Table 1:    Table 1  PERMITTED AND CONDITIONAL R‐1 RESIDENTIAL USES     R‐1 and all R‐1  Subdistricts  Subject to  Regulations for in:  ACCESSORY AND SUPPORT USES  [. . .] [. . .] [. . .]  *NOT YET APPROVED*  11  0160097_20221128_ay_16  Accessory Dwelling Units P(1) 18.0942.040  Junior Accessory Dwelling Units P(1) 18.0942.040  [. . .] [. . .] [. . .]    Footnotes:  (1) An Accessory Dwelling Unit or a Junior Accessory Dwelling Unit associated with a single‐ family residence on a lot is permitted, subject to the provisions of Chapter 18.09Section  18.42.040, and such that no more than two total units result on the lot.    SECTION 5.    Section 18.13.030 (Land Uses) of Chapter 18.13 (Multiple‐Family Residential  Districts) of Title 18 (Zoning) of the Palo Alto Municipal Code (“PAMC”) is amended to read  (additions underlined, deletions struck‐through, and omissions noted with bracketed ellipses):    18.13.030   Land Uses    Table 1 specifies the permitted and conditionally permitted land uses in the multiple‐family  residence districts.    Table 1  Multiple Family Residential Uses  [P = Permitted Use • CUP = Conditional Use Permit Required]   RM‐20 RM‐30 RM‐40 Subject to  Regulations in:  ACCESSORY AND SUPPORT USES  [. . .] [. . .] [. . .] [. . .] [. . .]  Accessory Dwelling Unit  when accessory to  permitted single‐family  residence  P(1) & (4) P(1) & (4) P(2) & (4) 18.0942.040  [. . .] [. . .] [. . .] [. . .] [. . .]  Footnotes:  (1) Permitted use only on lots less than 8,500 square feet in size.  [. . .]  (4) An accessory dwelling unit associated with a single‐family residence on a lot is permitted if  it is contained within the existing space of a single‐family residence or an existing accessory  structure in accordance with and pursuant to Section 18.42.040(a)(5), subject to the  provisions of Section 18.42.040 and such that no more than two total units result on the lot.    SECTION 6.    Any provision of the Palo Alto Municipal Code or appendices thereto inconsistent  with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is  hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.    Commented [YA10]: Response to HCD direction  *NOT YET APPROVED*  12  0160097_20221128_ay_16  SECTION 7.    If any section, subsection, sentence, clause, or phrase of this Ordinance is for any  reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction,  such decision shall not affect the validity of the remaining portions of this Ordinance. The City  Council hereby declares that it would have passed this Ordinance and each and every section,  subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard  to whether any portion of the ordinance would be subsequently declared invalid or  unconstitutional.    SECTION 8.    The Council finds that the adoption of this Ordinance is exempt from the provisions  of the California Environmental Quality Act (CEQA) pursuant to Public Resources Code Section  21080.17 and CEQA Guidelines sections 15061(b)(3), 15301, 15302 and 15305 because it  constitutes minor adjustments to the City’s zoning ordinance to implement State law  requirements related to accessory dwelling units as established in Government Code Section  65852.2, and these changes are also likely to result in few additional dwelling units dispersed  throughout the City. As such, it can be seen with certainty that the proposed action will not have  the potential for causing a significant effect on the environment.     SECTION 9. This ordinance shall be effective on the thirty‐first date after the date of its adoption.    INTRODUCED:        PASSED:    AYES:    NOES:     ABSENT:    NOT PARTICIPATING:     ATTEST:         ____________________________    ____________________________  City Clerk       Mayor    APPROVED AS TO FORM:      APPROVED:  ____________________________    ____________________________  Assistant City Attorney      City Manager            ____________________________          Director of Planning and           Development Services  STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY GAVIN NEWSOM, Governor DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT DIVISION OF HOUSING POLICY DEVELOPMENT 2020 W. El Camino Avenue, Suite 500 Sacramento, CA 95833 (916) 263-2911 / FAX (916) 263-7453 www.hcd.ca.gov December 23, 2021 Jonathan Lait, Planning Director Planning Department City of Palo Alto 250 Hamilton Avenue – Fifth Floor Palo Alto, CA 94301 Dear Jonathan Lait: RE: Review of Palo Alto’s Accessory Dwelling Unit (ADU) Ordinance under ADU Law (Gov. Code § 65852.2) Thank you for submitting the City of Palo Alto (City) accessory dwelling unit (ADU) ordinance (Ordinance No.5507) adopted September 26, 2020, to the California Department of Housing and Community Development (HCD). The ordinance was received on October 20, 2020. HCD has reviewed the ordinance and is submitting these written findings pursuant to Government Code section 65852.2, subdivision (h). HCD has determined that the ordinance does not comply with section 65852.2 in the manner noted below. Under the statute, the City has up to 30 days to respond to these findings. Accordingly, the City must provide a written response to these findings no later than January 23, 2022. HCD will review and consider any written response received from the City before that date in advance of taking further action authorized by Government Code section 65852.2. The adopted ADU ordinance meets many statutory requirements. However, the ordinance must be revised to comply with State ADU Law (Gov. Code, § 65852.2), as follows: • Section 18.09.030(a)(3) Units Exempt from Generally Applicable Local Regulations: The text of this Section and the applicable portion of Table 1 indicate the maximum size of a newly constructed detached ADU is 800 square feet. Although a local agency may establish minimum and maximum size requirements for ADUs pursuant to subdivision (c)(1) of Government Code section 65852.2 within limits, a local agency shall not establish a maximum square footage requirement for either attached or detached ADUs that is less than 850 square feet and 1,000 square feet for an ADU that provides more than one bedroom. (Gov. Code, § 65852.2, subd. (c)(2)(B).) Therefore, all relevant Jonathan Lait, Planning Director Page 2 sections of the ordinance must be amended to comply with this mandate in State ADU Law. • Section 18.09.030 Units Exempt from Generally Applicable Local Regulations: There appears to be a conflict between the text of this section and Table 1. The number of allowable units are correctly noted in Table 1 as “1 ADU and 1 JADU.” The text of section 18.09.030(a) appears to limit allowable units to “an ADU or JADU.” Government Code section 65852.2, subdivision (e)(1)(A), requires an ordinance to allow “one ADU and one JADU per lot… .” The City must amend the ordinance to correct this inconsistency, clarifying that “one ADU and one JADU” are permitted if all the conditions of section 65852.2, subdivision (e)(1)(A) apply. • Section 18.09.030(b) Application of Development Standards: Local agencies may establish standards for ADUs pursuant to Government Code section 65852.2, subdivision (a); however, these standards do not apply to ADUs constructed pursuant to subdivision (e). Table 1 impermissibly applies “underlying zoning” “for front setback[s]” to subdivision (e) ADUs. (Mun. Code, §18.09.030(b).) Subdivision (e)(1) describes permitted setbacks in full. Unless underlying zoning for all residential areas conforms to subdivision (e) limits, this table must be amended to comply with statute. (Gov. Code, § 65852.2, subd. (e)(1)(A).) • Section 18.09.030(b)(1) ADU Height in Flood Zones: The City has impermissibly restricted the height of ADUs. It appears that the City establishes minimum elevations for the first floor of structures in the flood zone, which is essentially the entire city to varying degrees. To account for this, the zoning code allows most residential structures to exceed otherwise maximum allowable heights for development. The City does not extend this accommodation to ADUs. Currently, Table 1 states that the maximum height for new, detached ADUs is 16 feet, but includes a caveat that “units built in a flood zone are not entitled to any height extension.” (Mun. Code, § 18.09.030(b).) In many instances, this would operate as an impermissible restriction on ADUs. Under State ADU Law, the City must accommodate an ADU of at least 800 square feet and 16 feet in height. Thus, the caveat in Table 1 is potentially confusing and could restrict the height to less than 16 feet. If it would in fact operate to effectively limit the height of ADUs to less than 16 feet, it would operate as an impermissible restriction on ADUs. As such, Table 1 should be revised to clarify that this limitation does not apply where necessary to permit an 800-square foot ADU that it at least 16 feet tall. (Gov. Code, § 65852.2, subds. (c)(2)(C) and (e)(1)(B)(ii).) • Section 18.09.040(b) Daylight Plane and ADU Height Standards: Table 2 states that “daylight plane” acts as a limit on the height of ADUs. In many instances, Jonathan Lait, Planning Director Page 3 this may not be a problem; however, daylight plane concerns cannot be used to unduly limit the height of an ADU. ADUs are permitted up to 16 feet high. (Gov. Code, § 65852.2, subds. (c)(2)(C), (e)(1)(B)(ii).) Therefore, in considering restrictions that the City is imposing on ADUs for daylight planes, the ordinance should note the 16-foot height allowable for ADUs. This Table must be amended to clarify this point. • Section 18.09.040(b) Units Subject to Local Standards: Table 2 sets out the development standards for ADUs that do not qualify under section 18.09.030. Although the City has more freedom to establish development standards for these ADUs, that is not without limitation. This section, and Table 2, must be amended to clarify that—notwithstanding the development standards—an ADU of at least 800 square feet, 16 feet in height, and with four-foot rear and side-yard setbacks is permitted as required by State ADU Law. (Gov. Code, § 65852.2, subd. (c)(2)(C).) • Section 18.09.040(b) Floor Area and JADUs: Development standards can account for ADUs in their measurement of the floor area restrictions or ratio (FAR). But these standards may not account for or consider JADUs. A JADU may not be included in this calculation, because a JADU is a unit that is contained entirely within a single-family residence. (Gov. Code § 65852.22, subd. (h)(1).) Footnote 4 of Table 2 impermissibly includes JADUs as part of the FAR calculations. This footnote must be amended to clarify this point. • Section 18.09.040(h) Noise-Producing Equipment: Local agencies may impose development standards on ADUs; however, these standards shall not exceed state standards. Section 18.09.040(h) states that noise-producing equipment “shall be located outside of the setbacks.” This section must be revised to only refer to ADUs since setbacks are not required for JADUs. In addition, this setback for noise-producing equipment for ADUs must be revised to make clear that this setback requirement will not impede the minimum state standards of four-foot setbacks. (Gov. Code, § 65852.2, subd. (c)(2)(C).) • Section 18.09.040(i)(2) Setbacks: Currently, this section states, “No basement or other subterranean portion of an ADU/JADU shall encroach into a setback required for the primary dwelling.” Under state law, new attached and detached ADUs have maximum four-foot rear and side-yard setbacks. (Gov. Code, § 65852.2, subds. (a)(1)(D)(vii), (c)(2)(C), (e)(1)(B), and (e)(1)(D).) Local agencies may impose setback requirements if the minimum rear and side-yard setbacks established by state law are not exceeded. This restriction is concerning on a number of grounds. First, setbacks may not be required for JADUs as they are constructed within the walls of the primary dwelling. Second, this requirement imposes excessive restrictions on ADUs converted from an existing area of the primary dwelling or accessory structure with a basement or subterranean space. Again, these Jonathan Lait, Planning Director Page 4 structures are not subject to setback requirements. Finally, this section would violate State ADU Law if the side or rear setback requirement for an ADU or JADU located in a basement or other subterranean structure exceeded four feet. Requiring ADUs and JADUs to meet the side and rear setbacks for the primary dwellings could exceed the maximum four-foot setbacks set out in State ADU Law. The ordinance must be revised to eliminate these concerns. • Section 18.09.040(j) Design: This section states, “Except on corner lots, the unit shall not have an entranceway facing the same lot line (property line) as the entranceway to the main dwelling unit unless the entranceway to the accessory unit is located in the rear half of the lot. Exterior staircases to second floor units shall be located towards the interior side or rear yard of the property.” These standards appear to apply only to the creation of ADUs and may unduly restrict the placement of an ADU on some lots. Local development standards provided by ordinance pursuant to subdivisions (a) through (d) of Government Code section 65852.2 do not apply to ADUs created under subdivision (e). Please consider eliminating this restriction or modifying it such that it applies “when feasible.” • Section 18.09.040(j)(2)(A) Privacy: The section states, “Second story doors and decks shall not face a neighboring dwelling unit.” This limitation, however, may place an impermissible constraint on an ADU. For example, excessive constraints would be placed on the creation of a second story ADU if residential units were located on all adjacent parcels. In addition, when operating in conjunction with Section 18.09.040(j), noted above, this restriction may prohibit ADUs created under subdivision (e) of Government Code section 65852.2. Accordingly, this provision must be revised to allow for more flexibility. The City could revise the first sentence of this section to state, “Second story doors and decks shall not face a neighboring dwelling unit, where feasible.” • Section 18.09.040(k)(4) Parking: The ordinance indicates if covered parking for a unit is provided in any district, the maximum size of the covered parking area for the accessory dwelling unit is 220 square feet. Further, under this section, the space for the covered parking count towards the total floor area for the site and the ADU if attached to the unit. Covered parking should not count towards the total floor area of the site as if it would unduly limit the allowable size of an ADU established by state law, nor should it directly count toward the area available for the ADU. Although standards within an underlying zone may apply when noted in the adopted ADU ordinance, they may not be more restrictive than those contained in state statute. (See, e.g., Gov. Code, § 65852.2, subs. (a)(1)(B), (a)(1)(D)(vii), (a)(1)(D)(x), (c), and (e).) The portion of this section stating “unit unless attached to the unit” should be deleted, or the section should otherwise be modified to comply with state law. Jonathan Lait, Planning Director Page 5 In these respects, revisions are necessary to comply with statute. HCD will consider any written response to these findings, such as a revised ordinance or a detailed plan to bring the ordinance into compliance with law by a date certain, before taking further action authorized pursuant to Government Code section 65852.2. Please note that HCD may notify the Attorney General’s Office in the event that the City fails to take appropriate and timely action under section 65852.2, subdivision (h). HCD appreciates the City’s efforts in the preparation and adoption of the ordinance and welcomes the opportunity to assist the City in fully complying with State ADU Law. Please contact Lauren Lajoie of our staff, at (916) 776-7495 or at Lauren.Lajoie@hcd.ca.gov if you have any questions or would like HCD’s technical assistance in these matters. Sincerely, David Zisser Assistant Deputy Director Local Government Relations and Accountability PLANNING & DEVELOPMENT SERVICES 250 Hamilton Avenue, 5th Floor Palo Alto, CA 94301 (650) 329-2441 February 3, 2022 Lauren Lajoie Housing & Community Development Division of Housing Policy Development 2020 W. El Camino Avenue, Suite 500 Sacramento, CA 95833 Lauren.Lajoie@hcd.ca.gov Dear Ms. Lajoie, This letter represents the City of Palo Alto’s response to your letter dated December 23, 2021 received by email, and received by hard copy on January 27, 2022. The content of the Housing and Community Development’s letter is italicized. The City of Palo Alto’s responses are bolded. 1. ADU Size - Section 18.09.030(a)(3) Units Exempt from Generally Applicable Local Regulations: The text of this Section and the applicable portion of Table 1 indicate the maximum size of a newly constructed detached ADU is 800 square feet. Although a local agency may establish minimum and maximum size requirements for ADUs pursuant to subdivision (c)(1) of Government Code section 65852.2 within limits, a local agency shall not establish a maximum square footage requirement for either attached or detached ADUs that is less than 850 square feet and 1,000 square feet for an ADU that provides more than one bedroom. (Gov. Code, § 65852.2, subd. (c)(2)(B).) Therefore, all relevant sections of the ordinance must be amended to comply with this mandate in State ADU Law. PAMC Section 18.09.030 is intended to describe the requirements for ADUs built under Gov. Code 65852.2, subdivision (e). This is not intended to create any limitation on ADUs built under subdivisions (a)-(d), which are governed by PAMC Section 18.09.040. The City will add clarifying language to this effect at the top of PAMC Section 18.09.030. 2. ADU & JADU - Section 18.09.030 Units Exempt from Generally Applicable Local Regulations: There appears to be a conflict between the text of this section and Table 1. The number of allowable units are correctly noted in Table 1 as “1 ADU and 1 JADU.” The text of section 18.09.030(a) appears to limit allowable units to “an ADU or JADU.” Government Code section 65852.2, subdivision (e)(1)(A), requires an ordinance to allow “one ADU and one JADU per lot… .” The City must amend the ordinance to correct this inconsistency, clarifying that “one ADU and one JADU” are permitted if all the conditions of section 65852.2, subdivision (e)(1)(A) apply. The City will update its ordinance to reflect the changes made by AB 3182 with respect to 1 ADU and 1 JADU. 3. Front Setback - Section 18.09.030(b) Application of Development Standards: Local agencies may establish standards for ADUs pursuant to Government Code section 65852.2, subdivision (a); however, these standards do not apply to ADUs constructed pursuant to subdivision (e). Table 1 impermissibly applies “underlying zoning” “for front setback[s]” to subdivision (e) ADUs. (Mun. Code, §18.09.030(b).) Subdivision (e)(1) describes permitted setbacks in full. Unless underlying zoning for DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 CITY OF PALO ALTO | 250 HAMILTON AVENUE, PALO ALTO, CA. 94301 | 650-329-2441 all residential areas conforms to subdivision (e) limits, this table must be amended to comply with statute. (Gov. Code, § 65852.2, subd. (e)(1)(A).) During our conversation on February 2, 2022, you explained that local rules may apply for front setbacks, including ADUs built under subdivision (e), and that it is not HCD’s position that subdivision (e) ADUs must be allowed at the front lot line. You explained that the issue with the current City ordinance is that it does not make clear that “underlying zoning” is only for front setbacks. The City will clarify this point in its ordinance. 4. Height - Section 18.09.030(b)(1) ADU Height in Flood Zones: The City has impermissibly restricted the height of ADUs. It appears that the City establishes minimum elevations for the first floor of structures in the flood zone, which is essentially the entire city to varying degrees. To account for this, the zoning code allows most residential structures to exceed otherwise maximum allowable heights for development. The City does not extend this accommodation to ADUs. Currently, Table 1 states that the maximum height for new, detached ADUs is 16 feet, but includes a caveat that “units built in a flood zone are not entitled to any height extension.” (Mun. Code, § 18.09.030(b).) In many instances, this would operate as an impermissible restriction on ADUs. Under State ADU Law, the City must accommodate an ADU of at least 800 square feet and 16 feet in height. Thus, the caveat in Table 1 is potentially confusing and could restrict the height to less than 16 feet. If it would in fact operate to effectively limit the height of ADUs to less than 16 feet, it would operate as an impermissible restriction on ADUs. As such, Table 1 should be revised to clarify that this limitation does not apply where necessary to permit an 800-square foot ADU that it at least 16 feet tall. (Gov. Code, § 65852.2, subds. (c)(2)(C) and (e)(1)(B)(ii).) For purposes of health and safety, the City of Palo Alto requires structures built in a flood zone to have a minimum finished floor height based on FEMA regulations. For a primary residence, the City provides an extra height allowance of 50% the minimum finished floor height. The City does not provide this allowance for any accessory structures, including ADUs. Nevertheless, ADUs in the flood zone can still be built to a height of 16 feet. It is unclear to the City how the failure to provide additional height above 16 feet represents an impermissible restriction on ADUs. During our conversation, you related that HCD prefers to have as few restrictions as possible on ADU production. The only restriction here is on finished floor height in the flood zone, which cannot be waived or relaxed without impacts on health and safety. Even in areas requiring the most extreme height above the base flood elevation, an ADU remains feasible within the 16 foot height limit. 5. Daylight Plane - Section 18.09.040(b) Daylight Plane and ADU Height Standards: Table 2 states that “daylight plane” acts as a limit on the height of ADUs. In many instances, this may not be a problem; however, daylight plane concerns cannot be used to unduly limit the height of an ADU. ADUs are permitted up to 16 feet high. (Gov. Code, § 65852.2, subds. (c)(2)(C), (e)(1)(B)(ii).) Therefore, in considering restrictions that the City is imposing on ADUs for daylight planes, the ordinance should note the 16-foot height allowable for ADUs. This Table must be amended to clarify this point. Please note that the City’s daylight plane regulations do not apply to subdivision (e) ADUs, which are governed by PAMC Section 18.09.030. The City will add a clarifying sentence at the top of Section 18.09.040 explaining that none of the regulations in PAMC 18.09.040 apply to subdivision (e) ADUs. In addition, the City will add a clarifying statement that the regulations in PAMC 18.09.040 are not intended to limit the conversion of existing structures to ADUs or JADUs. For all other ADUs, however, the City has requested clarity on HCD’s position on daylight plane on numerous occasions, most recently by email dated August 8, 2021. Please see this email, which is DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 CITY OF PALO ALTO | 250 HAMILTON AVENUE, PALO ALTO, CA. 94301 | 650-329-2441 attached, for an explanation of the City’s position. The City looks forward to continued discussion of this topic. 6. Clarify - Section 18.09.040(b) Units Subject to Local Standards: Table 2 sets out the development standards for ADUs that do not qualify under section 18.09.030. Although the City has more freedom to establish development standards for these ADUs, that is not without limitation. This section, and Table 2, must be amended to clarify that—notwithstanding the development standards—an ADU of at least 800 square feet, 16 feet in height, and with four-foot rear and side- yard setbacks is permitted as required by State ADU Law. (Gov. Code, § 65852.2, subd. (c)(2)(C).) The City will add a clarifying statement to this effect. 7. Floor Area & JADUs - Section 18.09.040(b) Floor Area and JADUs: Development standards can account for ADUs in their measurement of the floor area restrictions or ratio (FAR). But these standards may not account for or consider JADUs. A JADU may not be included in this calculation, because a JADU is a unit that is contained entirely within a single-family residence. (Gov. Code § 65852.22, subd. (h)(1).) Footnote 4 of Table 2 impermissibly includes JADUs as part of the FAR calculations. This footnote must be amended to clarify this point. Footnote 4 of Table 2 provides additional FAR on a site for ADUs and JADUs. This is an incentive to promote production of such units without limiting the development potential of a primary unit. Because a JADU is contained entirely within the space of a single-family residence, it would normally be included in the floor area of the primary unit. Footnote 4 provides an opportunity for a property owner to exempt all JADU square footage from the calculation of floor area for the primary unit. The removal of JADUs from footnote 4 would only serve to restrict the development of JADUs. The City will attempt to clarify the language of this footnote. 8. Noise-Producing Equipment - Section 18.09.040(h) Noise-Producing Equipment: Local agencies may impose development standards on ADUs; however, these standards shall not exceed state standards. Section 18.09.040(h) states that noise-producing equipment “shall be located outside of the setbacks.” This section must be revised to only refer to ADUs since setbacks are not required for JADUs. In addition, this setback for noise-producing equipment for ADUs must be revised to make clear that this setback requirement will not impede the minimum state standards of four-foot setbacks. (Gov. Code, § 65852.2, subd. (c)(2)(C)). As noted above, the City will add a clarifying statement that the regulations in PAMC 18.09.040 are not intended to limit the conversion of existing structures to ADUs or JADUs. For new construction, however, the City permits JADUs to build at a lesser setback than a single-family home normally would. Therefore, the removal of JADUs from this section will only serve to restrict the development of JADUs. Additionally, the City’s ordinance states that noise producing equipment needs to be placed outside the setback for an ADU or JADU. This means that the noise producing equipment itself cannot be placed closer than four-feet to a property line for either type of structure; not that the ADU or JADU cannot be placed at those locations. This is consistent with the state setback requirements for an ADU. 9. Basements - Section 18.09.040(i)(2) Setbacks: Currently, this section states, “No basement or other subterranean portion of an ADU/JADU shall encroach into a setback required for the primary dwelling.” Under state law, new attached and detached ADUs have maximum four-foot rear and side- yard setbacks. (Gov. Code, § 65852.2, subds. (a)(1)(D)(vii), (c)(2)(C), (e)(1)(B), and (e)(1)(D).) Local DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 CITY OF PALO ALTO | 250 HAMILTON AVENUE, PALO ALTO, CA. 94301 | 650-329-2441 agencies may impose setback requirements if the minimum rear and side-yard setbacks established by state law are not exceeded. This restriction is concerning on a number of grounds. First, setbacks may not be required for JADUs as they are constructed within the walls of the primary dwelling. Second, this requirement imposes excessive restrictions on ADUs converted from an existing area of the primary dwelling or accessory structure with a basement or subterranean space. Again, these structures are not subject to setback requirements. Finally, this section would violate State ADU Law if the side or rear setback requirement for an ADU or JADU located in a basement or other subterranean structure exceeded four feet. Requiring ADUs and JADUs to meet the side and rear setbacks for the primary dwellings could exceed the maximum four-foot setbacks set out in State ADU Law. The ordinance must be revised to eliminate these concerns. As noted above, the City will add a clarifying statement that the regulations in PAMC 18.09.040 are not intended to limit the conversion of existing structures to ADUs or JADUs. In addition, as with the previous section, the inclusion of JADUs here only serves to increase flexibility of JADU production. As noted above, the City will add a clarifying statement an ADU of at least 800 square feet, 16 feet in height, and with four-foot rear and side- yard setbacks is permitted as required by State ADU Law. With these clarifications the City does not believe it would violate State ADU Law to require that a newly constructed ADU limit any below-grade space to a setback greater than 4 feet. It is the City’s understanding that it could simply state that basements are not permitted for ADUs built under subdivisions (a)-(d), so long as it was still feasible to construct an ADU of at least 800 square feet. If this is the case, the City should have the lesser authority to direct the placement of below-grade development. The City has significant concerns about basements in general, and those concerns extend to basements constructed as part of ADUs. Due to a high water table throughout most of Palo Alto, the construction of basements requires dewatering (pumping water from the construction site). While this is allowed, there are significant restrictions on timing and procedures taken during the dewatering process. Secondly, development of homes in Palo Alto often includes requirements for the planting and maintenance of trees used to enhance privacy between properties. Placing ADUs with basements as close as 4 feet from the property line may jeopardize the health of these trees on the subject property as well as trees on adjacent properties. The trees could fail, which would both diminish the tree canopy—important for our environment and adaptation to climate change—and diminish the privacy between properties. Building below ground is not required in order to achieve a unit which follows the requirements in Section 65852.2 and can lead to potential impacts on adjacent lots, such as to large stature trees on adjacent lots which is a common occurrence in Palo Alto. Building a basement in these scenarios may cause the tree to fail which is a life, safety, and health hazard which would unduly affect both homeowners as a result of the action by one individual. There are construction methods which can be implemented for above ground construction to help limit root damage caused by this construction to preserve trees but that is not possible for below ground construction and can lead to significant impacts as noted above. DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 CITY OF PALO ALTO | 250 HAMILTON AVENUE, PALO ALTO, CA. 94301 | 650-329-2441 10. Corner Lots - Section 18.09.040(j) Design: This section states, “Except on corner lots, the unit shall not have an entranceway facing the same lot line (property line) as the entranceway to the main dwelling unit unless the entranceway to the accessory unit is located in the rear half of the lot. Exterior staircases to second floor units shall be located towards the interior side or rear yard of the property.” These standards appear to apply only to the creation of ADUs and may unduly restrict the placement of an ADU on some lots. Local development standards provided by ordinance pursuant to subdivisions (a) through (d) of Government Code section 65852.2 do not apply to ADUs created under subdivision (e). Please consider eliminating this restriction or modifying it such that it applies “when feasible.” As noted above, the City will add a clarifying sentence at the top of Section 18.09.040 explaining that none of the regulations in PAMC 18.09.040 apply to subdivision (e) ADUs. The City will clarify this is not applicable for subsection (e) ADUs. We are not aware of any evidence that this simple design requirement creates an excessive constraint on ADU production and that has not been our experience. 11. Privacy - Section 18.09.040(j)(2)(A) Privacy: The section states, “Second story doors and decks shall not face a neighboring dwelling unit.” This limitation, however, may place an impermissible constraint on an ADU. For example, excessive constraints would be placed on the creation of a second story ADU if residential units were located on all adjacent parcels. In addition, when operating in conjunction with Section 18.09.040(j), noted above, this restriction may prohibit ADUs created under subdivision (e) of Government Code section 65852.2. Accordingly, this provision must be revised to allow for more flexibility. The City could revise the first sentence of this section to state, “Second story doors and decks shall not face a neighboring dwelling unit, where feasible.” As noted above, the City will add a clarifying sentence at the top of Section 18.09.040 explaining that none of the regulations in PAMC 18.09.040 apply to subdivision (e) ADUs. We are not aware of any evidence that this simple design requirement creates an excessive constraint on ADU production and that has not been our experience. The City will clarify this is not applicable for subsection (e) ADUs. We are not aware of any evidence that this creates an excessive constraint and that has not been our experience. 12. Parking - Section 18.09.040(k)(4) Parking: The ordinance indicates if covered parking for a unit is provided in any district, the maximum size of the covered parking area for the accessory dwelling unit is 220 square feet. Further, under this section, the space for the covered parking count towards the total floor area for the site and the ADU if attached to the unit. Covered parking should not count towards the total floor area of the site as if it would unduly limit the allowable size of an ADU established by state law, nor should it directly count toward the area available for the ADU. Although standards within an underlying zone may apply when noted in the adopted ADU ordinance, they may not be more restrictive than those contained in state statute. (See, e.g., Gov. Code, § 65852.2, subs. (a)(1)(B), (a)(1)(D)(vii), (a)(1)(D)(x), (c), and (e).) The portion of this section stating “unit unless attached to the unit” should be deleted, or the section should otherwise be modified to comply with state law. As noted above, the City will add a clarifying sentence at the top of Section 18.09.040 explaining that none of the regulations in PAMC 18.09.040 apply to subdivision (e) ADUs. Currently, all covered parking in the single-family zones counts towards floor area for the site and dwelling unit. The City does not understand how this creates a standard that is more restrictive than that contained in state statute; none of the subsections cited in your letter speak to whether a garage for an ADU must be exempted from the unit size for the ADU. Moreover, this provision does DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 CITY OF PALO ALTO | 250 HAMILTON AVENUE, PALO ALTO, CA. 94301 | 650-329-2441 not create a constraint on ADU production, as a property owner may always choose to provide a detached garage, uncovered parking, or no parking at all for the ADU. The City has concerns that allowing attached garages onto these structures will incentivize individuals to illegally expand the unit into the garage, which would both exceed the City’s ordinance, contain unpermitted construction, and potentially place the health and safety of the occupants at risk. Sincerely, Jonathan Lait Director of Planning and Development Services DocuSign Envelope ID: 26247F48-AB81-46DC-AE75-91A87A8EE538 Certificate Of Completion Envelope Id: 26247F48AB8146DCAE7591A87A8EE538 Status: Completed Subject: Please DocuSign: 2022-02-02 Draft HCD ADU Letter response.docx Source Envelope: Document Pages: 6 Signatures: 1 Envelope Originator: Certificate Pages: 2 Initials: 0 Madina Klicheva AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 Madina.Klicheva@CityofPaloAlto.org IP Address: 199.33.32.254 Record Tracking Status: Original 2/3/2022 4:39:53 PM Holder: Madina Klicheva Madina.Klicheva@CityofPaloAlto.org Location: DocuSign Security Appliance Status: Connected Pool: StateLocal Storage Appliance Status: Connected Pool: City of Palo Alto Location: DocuSign Signer Events Signature Timestamp Jonathan Lait Jonathan.Lait@CityofPaloAlto.org Interim Director Planning and Community Environment City of Palo Alto Security Level: Email, Account Authentication (None) Signature Adoption: Uploaded Signature Image Using IP Address: 99.88.42.180 Sent: 2/3/2022 4:42:20 PM Viewed: 2/3/2022 4:42:59 PM Signed: 2/3/2022 4:43:06 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Garrett Sauls Garrett.Sauls@CityofPaloAlto.org Associate Planner Security Level: Email, Account Authentication (None) Sent: 2/3/2022 4:43:08 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign Rachael Tanner Rachael.Tanner@CityofPaloAlto.org Assistant Director of Planning and Development Services Security Level: Email, Account Authentication (None) Sent: 2/3/2022 4:43:08 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign Witness Events Signature Timestamp Notary Events Signature Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 2/3/2022 4:42:20 PM Certified Delivered Security Checked 2/3/2022 4:42:59 PM Signing Complete Security Checked 2/3/2022 4:43:06 PM Completed Security Checked 2/3/2022 4:43:08 PM Payment Events Status Timestamps R-1 R-1 RE R-1 R-1 RE R-1 R-1 (8000) R-1 (10000) R-1 (10000) R-1 R-1 RE RE RM-30 (D) R-1 (7000) R-1 R-1 R-2 R-2 R-1 (S) R-1 (10000) R-1 (8000) R-1 (S) RM-30 R-1 (8000)(S) R-1 (7000)(S) RM-30 PC-4426 R-1 RT-35 R-1 R-1 (8000) RM-30 R-1 (S) RE R-1 (S) RM-20 RM-20 R-1 (20000) PC-2711 RM-30 R-1 R-1 (7000)(S) R-1 (8000)(S) R-2 R-1 RM-20 RM-40 RM-40 RM-30 RM-30 RM-30 R-1 PC-4917 RM-20 R-1 (10000) RMD (NP) RM-30 R-1 (7000) RM-30 R-2 RM-40 R-1 (8000)RM-20RM-20 RM-30 RM-20 PC-2640 AMF PC-3023 RM-30 RM-20 R-1 (10000) RM-20 RM-20 R-1 (7000) RM-20 R-1 (S) R-1 (S) RM-20 RM-30 R-2 RM-30 RM-20RM-20 R-1 (10000) RM-40 DHS PC-2930 RM-20 PC-2836 DHS RM-40 RM-30 RM-20 RM-30 RMD (NP) RM-20 R-2 RM-30 RM-30 PC-1752 RM-20 PC-2744 R-2 RM-30 R-2 R-2 RM-20 R-2 RM-30 RM-30 RM-40 R-1 (8000) RM-20 PC-8659 R-2 R-2 RM-30 PC-2656 RM-30 R-2 R-1 (7000) R-2 PC-3036 RM-30 R-2 PC-2649 RM-20 PC-2236 PC-5116 RM-20 RM-30 RM-20 RM-30 R-1 (7000) DHS RM-20 RM-40 RM-20 R-2 RT-50 RM-20 PC-2218 PC-4374 R-2 PC-3183 AMF RM-20 RM-20 R-2 RM-30 RM-20 RM-40 PC-4511 RM-40 RM-30 RM-40 RM-20PC-4173 RT-50 PC-2130 R-2 R-1RM-30RM-30 PC-4779 PC-4243 RM-20 RM-20 PC-4463 R-2 PC-4831 R-2 R-2 R-2 RM-20 R-2 RM-30 R-2 RM-30 R-2 R-2 R-2 RM-30 PC-4354 RM-30 PC-4339RMD (NP) R-2 RM-30 R-2 PC-3028 RM-30 PC-3133 PC-2968 R-2 PC-4268 RM-20 R-2 RM-20 R-2 R-2 PC-5034RM-20 RM-30 PC-2145 PC-4053 RM-30 PC-2967 RM-20 RM-30 AMF (MUO) R-2 R-2 RM-20 PC-3429 R-2 RM-30 RM-30 R-2 PC-2049 PC-4782 PC-2952 R-2 RMD (NP) RM-20 R-2 RM-40 PC-4283 PC-3111 RT-50 PC-2666 RM-20 RM-30 PC-4973 PC-2666 PC-3623 RM-30 RM-30 (L) PC-3571 PC-3693 PC-3726 PC-4262 RM-30 (L) PC-4195 Middlefield RoadEl Camino Real Page Mill Road Sand Hill Road Oregon Expressway Foothill Expressway Hill v ie w A v e n u e E m barcadero Road Quarry Road Page Mill Road Foothill Expressway Cowper Street Waverley Street Louis Road Ross Road Webster Street Bryant Street Channing Avenue East Bayshore Road Lincoln Avenue Newell Road Seale Avenue South Court High Street Park Boulevard East Meadow Drive Stanford Avenue Colorado Avenue West Bayshore Road Hanover Street Miranda A venue Fabian Way Hamilton Avenue Homer Avenue Greer Road Ramona Street Edgewood Drive Loma Verde Avenue Churchill Avenue Matadero Avenue Lowell Avenue Center Drive Los Robles Avenue California Avenue Barron Avenue Welch Road Kingsley Avenue Maybell Avenue Wilkie Way Hansen Way Coleridge Avenue Byron Street Ely Place Manuela Avenue Oregon Avenue Amarillo Avenue Marion Avenue North California Avenue Emerson Street Embarcadero Road Pitman Avenue Laguna Avenue Ferne Avenue Nelson Drive Porter Drive Castilleja Avenue Quarry Road Chimalus Drive Hale Street College Avenue Amherst Street Seneca Street Lane 66 Bowdoin Street Alexis Drive Harker Avenue Deer Creek Road Ames Avenue El Dorado Avenue La Para Avenue Clark Way Birch Street Coyote Hill Road Clara Drive Columbia Street Georgia Avenue Rhodes Drive Cambridge Avenue El Verano Avenue La Donna Street Parkinson Avenue Kipling Street Pasteur Drive Heather Lane Alger Drive Florales Drive Oxford Avenue Forest Avenue Greenwood Avenue Cornell Street Amaranta Avenue Hillview Avenue Nathan Way Donald Drive Harvard Street Iris Way Hopkins Avenue Dana Avenue Fife Avenue Fulton Street Sutherland Drive Lambert Avenue Vineyard Lane Josina Avenue Marshall Drive (none) David Avenue Old Adobe Road Ge ng Roa d Orme Street El Carmelo Avenue Walnut Drive Princeton Street Maddux Drive Wildwood Lane Morris DriveMariposa Avenue Stanley Way Fernando Avenue Moreno Avenue Barbara Drive Arbutus Avenue Chaucer Street Shopping Center Way Walter Hays Drive Jackson Drive Kenneth Drive Martin Avenue Patricia Lane Cereza Drive Guinda Street Transport Street Old Trace Road Ilima Way Santa Ana Street Encina Grande Drive Los Palos Avenue Lois Lane Gailen Avenue Whitsell Street Janice Way Southampton Drive Pomona Avenue San Antonio Road Evergreen Drive Ivy Lane Rorke Way Stelling Drive Ashton Avenue Military Way Robb Road Jefferson Drive Santa Rita Avenue Saint Claire Drive Rinconada Avenue Seminole Way Manuela Court Garland Drive Kings Lane Oak Hill Avenue Nevada Avenue Madison Way Southwood Drive Richardson Court Lupine Avenue Campesino Avenue La Calle Suzanne Drive Vernon Terrace Celia Drive Washington Avenue Dennis Drive Rambow Drive Portage Avenue Elwell Court Stern Avenue Maclane Fallen Leaf Street Wells A ven ue Tulip Lane Ross Court Acacia Avenue Tasso Street Stone Lane Lane D East Mark Twain Street Maple Street El Cerrito Road Foothill Expressway La ura L ane Lane D West Primrose Way May Court Baker Avenue Melville Avenue Corina Way Palm Street Wellesley Street Wright Place Pistache Place Peral Lane Bret Harte Street Carmel Drive Arcadia Place Varian Way Saint Francis Drive Cardinal Way Timlott Lane Marlowe Street Shauna Lane Corporation Way Plum Lane Randers Court (none) Dana Avenue Oregon Avenue Fulton Street Ramona Street Kipling Street North California Avenue Bryant Street Park Boulevard Colorado Avenue Tasso Street Ramona Street South Court Guinda Street Byron Street Los Altos Stanford University Los Altos Hills Menlo Park Mountain View East Palo Alto Atherton This map is a product of City of Palo Alto GIS [ 0 0.4 0.80.2 Miles Half Mile Buffer fromMajor High Quality Transit Legend Area within Half-Mile of High Quality Transit Caltrain Station Platforms High-Quality Transit Corridor Residential Zoning Districts City Limit §¨¦280 £¤101 UniversityDowntown Station CaliforniaStation San AntonioStation