HomeMy WebLinkAbout04-044 CondoConvOrd
AGENDA STATEMENT
PLANNING COMMISSION MEETING DATE: JANUARY 11,2005
SUBJECT:
ATTACHMENTS:
RECOMMENDATION:
PROJECT DESCRIPTION:
PUBLIC HEARING - P A 04-044 Condominium Conversion
Ordinance A Þ /
(Report prepared by: Jeff Baker, Associate Planner)UfY
1.
Resolution Recommending that the City Council Adopt an
Ordinance Regulating the Conversion of Existing Apartments
in the City to Condominiums.
Urgency Condominium Conversion Ordinance
Condominium Conversion Ordinance (Non urgency
ordinance)
Alternative Urgency Condominium Conversion Ordinance
Alternative Condominium Conversion Ordinance (Non
urgency ordinance)
Notice of Public Hearing to Consider Initiating Proceedings
to Adopt a Condominium Conversion Ordinance.
List of Dublin Apartments
City Council Staff Report (dated September 7,2004)
City Council Staff Report (dated November 16, 2004)
without attachments
City Council Resolution 181-04, Initiating Proceedings to
Adopt an Ordinance Regulating the Conversion of Existing
Apartments in the City to Condominiums.
City Council Meeting Minutes of November 16,2004
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
1.
2.
3.
4.
5.
Open public hearing;
Receive Staff Presentation;
Question Staff, Applicant and the public;
Close Public Hearing and Deliberate; and
Adopt Resolution (Attachment 1) Recommending City
Council Adopt an Ordinance Regulating the Conversion of
Existing Apartments in the City to Condominiums.
Background:
On September 7,2004, the City Council adopted a Resolution (Resolution #181-04) initiating proceedings
to adopt an ordinance regulating the conversion of existing apartments in the City to for-sale
condominiums (Attachment 10). Following that meeting, Staff studied the various mechanisms for
regulating condominium conversions. This Study included a complete review of the Subdivision Map
Act, City of Dublin General Plan Housing Element and Condominium Conversion Ordinances from
different cities throughout California, including the cities of Livermore and Walnut Creek. Based on this
Study, Staff developed a series of policy alternatives for the City Council to consider. On November 16,
2004, Staff presented these policy alternatives to the City Council (Attachment 9). The City Council
provided Staff with direction regarding the development of the proposed Condominium Conversion
Ordinance. The City Council further directed Staff to hold a meeting with the owners of apartments
G:\P A#\2004 \04-044 Condo Conversion ZOA \pcsr 1-11-05.doc
COPIES TO:
P A File
ITEM NO. h
within the City of Dublin in order to inform them of these policy recommendations and solicit their
comments. On December 9, 2004, Staff held a meeting with these property owners and other interested
parties. Staff utilized the feedback received at this meeting to further develop the proposed Condominium
Conversion Ordinance (Attachments 2-5). Feedback from the property owners is included in the analysis
section of this Staff Report.
Apartment units provide a type of housing that is a key to a healthy diversity of housing stock in the
community. Apartments provide housing for all levels of affordability in the community and are a
valuable tool for providing work force housing. Staff believes that the conversion of one or two of the
City's apartment communities could have a major impact on the diversity of the City's housing stock in
that it would remove from the market a significant percentage of the existing rental units. If sold rather
than rented, the units would no longer be available to a segment of the community that is not in a position
to purchase such units. In addition, the loss of these units would likely decrease the vacancy rate, may
increase rents, and this may in turn further exacerbate the City's shortage of affordable rental units. This
might cause a lasting imbalance in the diversity of housing stock in the City.
In the past 10 years the City has seen the development of approximately 1,500 residential apartment
units, for an overall total of approximately 3,172 units throughout the City. It should be noted that
approximately 1,119 of these units are already mapped for condominiums but continue to operate as
apartment communities (Attachment 7). However, the California Department of Real Estate (DRE) has
not issued a Public Report for these properties. The Public Report vests the property owner's right to sell
the units individually. These apartment communities remain subject to new City ordinances until the
property owner has received a Public Report from the DRE. If all of these units converted, the ratio of
apartments to ownership units would be greatly reduced.
In the past seven months, Staff has received inquiries from several existing apartment owners indicating
their intent to file subdivision documents to convert their projects to condominiums. The City is currently
processing subdivision applications to convert the following apartment projects to for-sale condominiums.
Current Subdivision Applications
Iron Horse Trail Apartments (Dougherty Road) -
Archstone - Emerald Park Apartments (Hacienda Drive) -
Total
11 7 units
324 units
441 Units
Process:
At the present time should a property owner wish to convert an existing apartment complex to for-sale
condominiums, the property owner must record a Condominium Map and obtain a Public Report from the
Department of Real Estate (DRE). The application for a Condominium Map would be processed in
accordance with State law under the Subdivision Map Act. The Map Act contains provisions that require
the property owner to give notice to tenants and gives tenants the right to purchase their existing units
before they are placed on the market for-sale to the general public. State law permits the City to expand
upon these basic requirements through the adoption of a condominium-conversion ordinance. State law
provides that cities have the responsibility to use the powers vested in them to facilitate the improvement
and development of housing to make adequate provision for the housing needs of all economic segments
of the community. (See Gov. Code, § 65580(d)). For example, a condominium conversion ordinance
could limit conversions to maintain a balance of housing stock and could require the provision of
affordable units under the City's Inclusionary Zoning Ordinance.
Both of the subdivision applications referenced above would only be subject to the Condominium
Conversion Ordinance if it is adopted before the City takes action on these subdivision maps. Ordinarily,
under the Subdivision Map Act, the City may only apply standards in effect at the time that an application
for a tentative subdivision map is deemed complete (Gov. Code, § 66474.2(a)). However, the City
Council adopted a Resolution initiating proceedings to adopt a condominium-conversion ordinance
2
(Attachment 10). This Resolution was designed to prevent those that file subdivision applications to
convert existing apartments to condominiums from avoiding the pending condominium-conversion
ordinance. The Resolution permits the City to apply the Condominium Conversion Ordinance in effect on
the date the City approves or disapproves a tentative map (Gov. Code, § 66474.2(b)). The Subdivision
Map Act requires the City to take action on maps within 50 days of deeming an application complete. At
the time that this Staff Report was prepared, the subdivision applications referenced above had not been
deemed complete.
Neighboring Jurisdictions:
Cities throughout California have adopted Condominium Conversion Ordinances including the cities of
Livermore and Walnut Creek. Both of these cities adopted conversion ordinances that contain provisions
which restrict the conversion of apartments to condominiums and provide relocation benefits to displaced
tenants. The following is a synopsis of the policy components contained in these ordinances:
The City of Livermore:
· Application of the ordinance: Projects with 2 or more units.
· Limitations on Conversions: The City Council must annually determine the maximum number of
apartments that are permitted to convert.
· Limitations on Rent Increases: Rent increases are not permitted from the date a tentative map
application is filed until the tenant relocates.
· Relocation Assistance: All tenants receive financial relocation assistance equal to 2-months rent.
Seniors are offered rent controlled lifetime leases. Low and moderate income tenants shall be
offered a minimum of a 3-year, rent controlled lease. Tenants with school aged children receive a 6-
month lease extension.
· Building Code Requirements: Projects shall conform to the applicable building code in effect at the
time the last building permit was issued.
· Site Development Review: Landscaping and buildings shall be reviewed by the Planning
Department and refurbished and restored to achieve a high degree of appearance.
The City of Walnut Creek:
· Application of the ordinance: Projects with 2 or more units.
· Limitations on Conversions: Conversion is limited to no more than 5% of the City's potentially
convertible rental stock in anyone calendar year.
· Limitations on Rent Increases: Rent increases are not permitted for a period of 2-years from the date a
tentative map application is filed with the city.
· Relocation Assistance: All tenants receive financial relocation assistance equal to 2-months rent.
Seniors are offered rent controlled lifetime leases. Low and moderate income tenants shall be offered
a minimum of a 3-year, rent controlled lease.
· Building Code Requirements: Projects shall conform to the applicable building code in effect at the
time the last building permit was issued.
· Site Development Review: Landscaping and buildings shall be refurbished and restored to achieve a
high degree of appearance.
Proposed Policy Components:
In consideration of the potential impacts from conversion Staff has prepared a Condominium Conversion
Ordinance to regulate the conversion of rental apartments to for-sale condominiums. The key components
of the proposed Condominium Conversion Ordinance are as follows:
· Application of the Condominium Conversion Ordinance
· Limitations on Conversions
· Limitations on Rent Increases
· Tenant Relocation Assistance Plan
3
· Inclusionary Zoning Regulations
· Tenant's Right to Purchase Units
· Building Code Requirements
· Site Development Review
Staff recommends that the City Council adopt the attached Urgency Condominium Conversion Ordinance
to ensure that it is in effect before the City takes action on the current subdivision applications
(Attachment 2 or 4). Approval of an ordinance typically requires two readings before the City Council
and then takes effect 30-days following the second reading. However, the City Council may cause the
Ordinance to take effect immediately by adopting it as an urgency ordinance if the City Council
determines that the conversion of these apartments to condominiums might frustrate the City's goal and
State law obligation to adequately provide for the housing needs of all economic segments of the
community. There is the potential that the urgency ordinance could be challenged. Therefore, Staff
recommends that the City Council also adopt a non urgency Condominium Conversion Ordinance
(Attachment 3 or 5). The non urgency ordinance will provide the City with a backup ordinance in the
event that the urgency ordinance is challenged.
ANAL YSIS:
The following is a discussion of the key policy components of the proposed Condominium Conversion
Ordinance (Attachments 2-5). The discussion of each component includes an analysis of the policy along
with associated comments received at the meeting with the property owners, and a discussion of the
financial impacts of implementing these provisions.
A. Application of the Condominium Conversion Ordinance
The following criteria would be used to identify multi-family properties that are subject to the
proposed Condominium Conversion Ordinance:
·
Developments containing 20 or more dwelling units under the same ownership that are held
for lease to the general public (Attachment 2 - Section 8.54.020);
Residential rental projects in which units have been occupied as rental units (Attachment 2 -
Section 8.54.030); and
Projects that have not received a public report from the Department of Real Estate (Attachment
2 - Section 8.54.030).
·
·
Analysis: The provision to make all projects with 20 or more rental units subject to the
Condominium Conversion Ordinance is consistent with the threshold that has been established for
the existing Inclusionary Zoning Regulations (Section 8.68). This would exclude duplexes and
small apartment buildings from the ordinance. The Alders Apartments is the smallest apartment
building in the City with only 8 units. The Evan Alan Apartments is the next smallest with a total of
20 units.
The conversion of units that have already been occupied could result in the displacement of
residents. Therefore, apartments would be subject to the ordinance if they have already been
occupied. Tenants that would be displaced by conversion would be eligible to receive relocation
benefits required by the proposed Condominium Conversion Ordinance.
The requirement to obtain a public report from the DRE would make units that have already been
mapped for condominiums subject to the proposed Condominium Conversion Ordinance. State law
provides that only the Public Report vests the building owners' rights to sell the units individually.
Without the Public Report, the development remains subject to new City ordinances regardless of
whether the building is already mapped. At the time that this Staff Report was prepared, the DRE
4
had not issued a Public Report for any units within the City that have been mapped for
condominiums. However, if all of these units were converted, the ratio of apartments to ownership
units would be greatly reduced and a significant number of tenants would be displaced.
Implementation of this provision would reduce the potential impact to these tenants. This approach
to regulating the conversion of mapped apartments to condominiums that is not currently used by
surrounding jurisdictions but is common in Southern California.
The City Council recommended including the provision as described above in the Condominium
Conversion Ordinance.
Property Owner '5 Feedback: At the meeting held with the property owners on December 9, 2004,
several of the owners expressed concern about applying the proposed Condominium Conversion
Ordinance to properties that have already processed a Final Map with the City. These property
owners indicated that approval of their existing condominium maps implied certain approvals from
the City and that application of a Condominium Conversion Ordinance would effectively reverse
these approvals and devalue their properties. Additionally, one property owner requested that the
ordinance apply to properties with 21 or more units in order to exclude the Evan Alan Apartments.
The Evan Alan Apartments has 20 units and has processed a Final Condominium Map but does not
have a Public Report from the DRE. The property owner(s) also expressed concern that they were
not notified of the City Council meeting, held on September 7, 2004, in which the City initiated the
development of the proposed ordinance. The City sent a public hearing notice to the leasing office
at each property advising them of the City Council hearing. However, the property owner(s) were
inadvertently not sent a copy of hearing notice. Staff has updated the address list for the public
hearing notices to include each property owner. All property owners were sent a notice advising
them of the Planning Commission hearing on January 11, 2005.
Staff has prepared an alternative ordinance (Attachments 4 & 5) that would exclude properties with
an approved condominium map from the conversion ordinance. This alternative ordinance is
available should the Planning Commission decide to recommend to the City Council the approval of
a Condominium Conversion Ordinance that excludes properties with approved condominium maps.
Fiscal Impact: Implementation of these policy components would not have an impact on their own.
However, Staff time would be required in order to implement the overall ordinance.
B. Limitations on Conversions
Section 8.54.040 of the proposed Condominium Conversion Ordinance would permit conversions if
the minimum number of rental units within the City of Dublin exceeds 30% of the total housing
supply. Conversions would not be permitted to reduce the total number of rental units below 30% of
the total housing supply.
Analysis: This provision sets clearly defined standards that can be used to determine if rental units
may be converted to condominium units and continue to preserve diversity in the housing stock.
When the General Plan Housing Element was updated in 2000, there were 9,597 residential units
within the City of Dublin. Multi-family rental units represented 2,921 or approximately 30% of the
total housing supply. This ratio was consistent with the composition of the nationwide housing
supply at that time and ensures a diversity of housing types to meet the needs of different economic
segments of the community. Implementation of this provision in the ordinance would preserve a
core stock of rental housing consistent with the housing ratio identified in the Housing Element.
The ratio of existing rental housing has changed since the General Plan Housing Element was
updated in 2000. As of October 2004, the City has issued or finaled building permits for 15,447
residential units. Approximately 25% of the residential permits that have been issued were for
5
multi-family rental housing. Therefore, no condominium conversions would be permitted until
additional multi-family rental units are constructed and the ratio of these units exceeds 30% of the
total housing supply.
Staff has estimated the City's housing ratio at built out utilizing 2000 Census data, Association of
Bay Area Governments (ABAG) projections, and the current General Plan Land Use Map. Multi-
family rental units are anticipated to represent a maximum of approximately 36% of the total
housing supply when the city is fully built out. This ratio is based on the assumption that all
undeveloped parcels with existing Medium/High and High Density General Plan Land Use
designations will consist of rental units. However, it is likely that for-sale condominiums will be
built on some of these parcels. The construction of for-sale condominiums rather than rental
apartments would therefore reduce the ratio of rental units below 36%. The ultimate housing ratio
will effect the ability of property owners to convert apartment to condominiums.
The policy alternatives that were presented to the City Council on November 16, 2004, also included
a recommendation that would require as a prerequisite to conversion that the City wide vacancy rate
exceed 5% (Attachment 9). The City of Dublin General Plan Housing Element (Appendix A,
Dublin Housing Stock) indicates that a vacancy rate of 5% is considered ideal for adequate
consumer mobility and to ensure that alternative housing is available for tenants that are displaced
by conversion. The City Council recommended that this provision be included in the draft
ordinance. However, Staff has discovered a number of implementation issues associated with this
provision. Vacancy rates are difficult to track. Professional vacancy reports do not typically track
smaller apartment complexes and would not necessarily give an accurate representation of the
overall vacancy rate within the City. Staff could periodically survey property owners in order to
determine the vacancy rate. However, this would be a labor intensive task and it would be difficult
to verify the accuracy of the information that is collected.
Property Owner 's Feedback: The property owners indicated that vacancies are at least partially a
reflection of the rents that a property is charging. Therefore, the vacancy rate can be manipulated by
an increase or decrease in rent. Based on these concerns and the difficulty in tracking vacancy rates,
Staff has decided to recommend against including a vacancy requirement in the proposed
Condominium Conversion Ordinance.
Fiscal Impact: A minimal amount of Staff time would be required to calculate the current housing
ratios. The City already collects the information that is needed to calculate the ratio. The cost of
Staff time needed to calculate the ratio would be recovered through the pre application fee described
in Section 8.54.040.A of the ordinance.
C. Limitations on Rent Increases
Section 8.54.100 restricts rent increases from the date the property owner provides each tenant with
a Notice of Intent to Convert pursuant to Section 8.54.050 until twelve months following the
approval of the Condominium Conversion Permit or six months following the issuance of a public
report by the Department of Real Estate (DRE), whichever occurs later.
Analysis: Restricting the property owner's ability to raise rent will limit the potential for property
owners to encourage tenants to vacate early in order to avoid the noticing requirements of the
Subdivision Map Act and the proposed City of Dublin Condominium Conversion Ordinance. Rent
would be held in place for a minimum of 6-12 months under this provision. The City Council
directed Staff to include this provision in the proposed Condominium Conversion Ordinance.
Property Owner '5 Feedback: The property owners did not express concern regarding this specific
provIsIOn.
6
Fiscal Impact: A self reporting process would be utilized and a minimal amount of Staff time would
be required to implement this policy. The property owner would be required to notify each tenant of
the limitation on rent increases and provide Staff with a copy of the notice as described in Section
8.54.050.A of the proposed ordinance.
D. Tenant Relocation Assistance Plan
Section 8.54.110 of the proposed ordinance requires the Applicant to implement a Tenant
Relocation Assistance Plan. The relocation plan shall be prepared by the Applicant and indicate the
Applicant's commitment to provide tenants with the benefits required by the Condominium
Conversion Ordinance. These benefits include financial assistance with moving expenses and an
extension of lease terms for qualified tenants.
Financial Relocation Assistance
Section 8.54.11 O.D of the proposed ordinance requires the property owner to provide each tenant
with a payment equal to 3 months rent to help cover moving expenses. The property owner is
required to make this payment within 10 days ofthe tenant's waiver to purchase their existing unit.
Anažvsis: The Subdivision Map Act does not require property owners to provide relocation
assistance to displaced tenants. However, there are costs associated with the physical act of moving
and setting up new utilities. The payment of moving expenses is intended to reduce the financial
burden that is placed on tenants as a result of the property owner's decision to convert and the
tenants' subsequent need to relocate.
The policy alternatives that were presented to the City Council on November 16, 2004, included a
recommendation to pay moving expenses equal to 2-months rent within 14-days of relocation.
However, the City Council directed Staff to require a payment equal to 3-months prior to relocation.
This provision has been included in the proposed ordinance as requested by the City Council.
Property Owner's Feedback: Concern was raised by the property owners regarding the requirement
to provide financial relocation assistance. Several property owners that were present at the meeting
stated that the annual tenant turnover rate was between 50% and 80%. These property owners do
not feel that they should be required to pay relocation expenses for tenants that would likely move
regardless of a conversion. They suggested that relocation benefits be limited to longtime tenants.
However, as demonstrated by these property owners, as much as 50% of their tenants remain for
more than one year. Even tenants that might plan to move in a given year could be forced to move
early as a result of a conversion. These tenants will incur moving expenses that they might not have
otherwise incurred if the property was not converted. Many of these residents may not have the
financial resources to pay moving expenses. Therefore, Staff continues to recommend the financial
relocation assistance provision for all tenants.
Fiscal Impact: A self reporting process would be utilized and a minimal amount of Staff time would
be required to implement this policy. The property owner would be required to notify each tenant of
their relocation benefits and provide Staff with a copy of the notice as described in Sections 8.54.050
and 8.54.110 of the draft ordinance.
Continued Tenancy for Qualified Tenants
Section 8.54.110.E of the proposed ordinance requires property owners to provide a 12-month
extension of tenancy to all eligible tenants beyond the 180 day period required by the Subdivision
Map Act (Section 66427.1 (c). This 12-month extension shall be provided if the head of household
or spouse meets the following eligibility criteria:
7
· Has attained age 62 or older;
· Has a disability as defined by Section 54 ofthe California Civil Code;
· Is a resident of an inclusionary housing unit; or
· Is residing with one or more minor dependent children.
Anažvsis: There is a limited amount of housing that meets the needs of senior, disabled and low-
income tenants. For example, a disabled tenant may require an apartment on the ground floor.
Ground floor apartments are harder to find and it may require an extended period of time to locate
such a unit. The Subdivision Map Act requires property owners to give tenants a 180-day notice to
vacate an apartment prior to terminating a tenancy due to a condominium conversion. However,
180-days may not be a sufficient amount of time for a displaced tenant with special needs to find
suitable replacement housing in Dublin. Similarly, the 12-month extension for families with school
aged children will provide them with flexibility to schedule their move and potentially avoid moving
during the school year and disrupting the education process. The 12-month extension included in
the proposed Condominium Conversion Ordinance would provide these tenants with additional time
to find housing within the community and further reduce the potential negative impacts of moving.
The policy alternatives that were presented to the City Council, included a recommendation to
provide a 3-year lease extension to tenants that were seniors, disabled or low income (Attachment
9). However, the City Council expressed concern that a 3-year extension may be overly burdensome
to property owners and result in discrimination against renting to these tenants. The City Council
recommended the 12-month extension that is included in the proposed ordinance.
Property Owner's Feedback: The property owners agreed that a 3-year lease extension was
burdensome and also questioned the need to provide any type of time extension.
Fiscal Impact: A minimal amount of Staff time is required to implement this policy. The property
owner is required to demonstrate that they have entered a binding lease extension or that the tenant
has refused an offer for an extension. The cost of Staff time needed to review this documentation
could be billed to the Applicant on a time and materials basis.
E. Inelusionary Zoning Regulations
Section 8.54.130 of the proposed Condominium Conversion Ordinance treats condominium
conversions as new residential development projects. As new residential development projects,
these converted properties would be required to comply the Inc1usionary Zoning Regulations. The
current Inclusionary Zoning Regulations require new developments to provide 12.5% of the units as
affordable (Section 8.68). However, if the project had complied with the Inclusionary Zoning
Regulations in effect at the time the project was built, the converted project will only be required to
make up the difference. Thus, if the project has complied with a 5% inclusionary requirement at the
time it was constructed, then the conversion would be required to satisfy the remaining 7.5%
inclusionary obligation under the existing ordinance.
Analysis: The conversion from apartments to condominiums could result in a substantial loss of
market rate and affordable rental units. However, condominiums are often seen as an affordable
form of homeownership. The conversion of apartments to condominiums will provide the
community with additional affordable ownership opportunities. In addition, the provision to require
converted properties to conform to the Inclusionary Zoning Regulations will make 12.5% of the
units affordable to a segment of the market that might not otherwise be able to purchase a
condominium unit.
The policy alternatives that were presented to the City Council, included a recommendation to
8
require converted properties to comply with current Inclusionary Zoning Regulations. The City
Council directed Staff to include this provision in the proposed Condominium Conversion
Ordinance.
Property Owner's Feedback: Staff discussed this provision with the property owners at the meeting
on December 9th. The property owner's comments were limited to receiving credit for the portion of
any affordable obligation that has already been met.
Fiscal Anažvsis: A substantial amount of Staff time could be required to implement this policy if a
large number of units are permitted to convert at one time. However, this Staff time could be billed
to the applicant on a time and materials basis.
F. Tenant's Right to Purchase Units
The proposed ordinance (Section 8.54.090.B) requires property owners to provide tenants living in
inclusionary units with an exclusive right to contract for the purchase of the unit occupied by the
tenant at the sales price set forth in the Inclusionary Zoning Regulations based on the tenant's
annual household income.
Analysis: The Subdivision Map Act requires property owners to provide tenants with an exclusive
right to contract for the purchase of their existing unit upon the same terms and conditions that such
unit will initially be offered to the general public or on terms more favorable to the tenant.
However, the Subdivision Map Act does not address inclusionary units. The provisions of the
proposed Condominium Conversion Ordinance will provide tenants that reside in inclusionary units
with the same preferential treatment that market rate tenants receive. The purchase price would be
based on the tenant's household income in accordance with the Inclusionary Zoning Regulations
(Section 8.68). This could enable tenants that rent affordable units to purchase their existing unit at
an affordable purchase price and avoid being displaced by the conversion.
The policy alternatives that were presented to the City Council on November 16, 2004, included a
recommendation to extend the right to purchase to inclusionary tenants at a price consistent with the
Inclusionary Zoning Ordinance. The City Council directed Staff to include this provision in the
proposed Condominium Conversion Ordinance.
Property Owner's Feedback: Staff discussed this provision with the property owners at the meeting
on December 9th. The property owners did not provide comments to Staff regarding changes to this
prOVISIOn.
Fiscal Analysis: A substantial amount of Staff time could be required to implement this policy if a
large number of units are permitted to convert at one time. However, this Staff time could be billed
to the applicant on a time and materials basis.
G. Building Code Requirements
Section 8.54.080 of the proposed Condominium Conversion Ordinance requires converted units to
meet the building code requirements in effect at the time of construction. Any retrofitting or
remodeling work would be required to meet current building code requirements in effect at the time
that building permits were issued. Converted units would also be required to meet the current
Housing Code as defined by the Dublin Municipal Code.
Analysis: Many existing residential dwellings, including apartments, within the City of Dublin were
built prior to the current building code requirements. These dwellings are considered safe and
inhabitable structures. Therefore, the City does not typically require costly retrofitting of these
9
properties to bring them up to current building code requirements. Conversion of existing
apartments to condominiums does not substantially change the use of these structures in a way that
would make them less safe or inhabitable. However, any remodeling or retro fitting work that the
property owner performs would be required to meet current building code requirements. Housing
Code provides basic safety requirements. Existing apartments are required to meet these current
Housing Code requirements. Converted units would be required to conform to the housing code at
the time of conversion.
The City Council discussed this policy component at the City Council hearing on November 16,
2004. The City Council directed Staff to include in the ordinance a provision that requires buildings
to be in conformance with the Building Code at the time that the units were constructed. Staff
discussed this provision with the property owners.
Property Owner's Feedback: The property owners did not express concern with this provision.
Fiscal Impact: None. The ordinance requires the property owner to provide the City with a report
on the condition of each structure and any variation in the code requirements. The cost for a City
inspector to review the property and the report would be billed to the property owner on a time and
materials basis as part of the cost for a Condominium Conversion Permit. The property owner
would be required to obtain a building permit for retrofitting work. The cost of building inspections
is included in the building permit fees.
H. Site Development Review
Section 8.54.060 of the proposed Condominium Conversion ordinance requires Site Development
Review (SDR) concurrent with a request to convert to condominiums. The SDR will allow the City
to evaluate the physical appearance of the property and require work to refurbish and restore the
project as necessary to achieve a high degree of appearance, quality and safety.
Analysis: A Condominium Map is required in order to convert an existing apartment complex to
condominiums. However, the map process does not provide a mechanism to evaluate the physical
appearance of a property. For example, the City could receive an application to convert an existing
apartment complex with deferred maintenance that creates an eyesore within the community. This
deferred maintenance could include external painting and landscape maintenance to repair sparse or
overgrown landscaping. The SDR permit will provide the Planning Commission with a mechanism
to evaluate the physical appearance of the property and impose conditions that require remedial work
to maintain the visual appearance of the City of Dublin.
Staff presented this policy alternative to the City Council for consideration. The City Council
directed Staff to include a provision requiring a Site Development Review permit in this ordinance.
Property Owner's Feedback: The property owners raised concern that the Site Development
Review process might provide the City with the arbitrary power to make modifications beyond
simply rehabilitating the property. However, the language in the proposed ordinance limits the
City's evaluation to maintenance and conformance with prior site and architectural approvals. The
intent of this provision is not to reopen full site development review but simply to ensure that the
property remains in conformance with existing approvals.
Fiscal Impact: Community Development Department Staff time would be required to perform a
physical inspection of the property and review proposed improvements. However, the cost of this
review would be included in the application fee for a Condominium Conversion Permit.
10
ENVIRONMENT AL REVIEW:
The California Environmental Quality Act (CEQA), together with the State guidelines and City
environmental regulations require that certain projects be reviewed for environmental impacts and that
environmental documents be prepared. This project has been found to be exempt from the California
Environmental Quality Act (CEQA), pursuant to CEQA Guidelines Section 15061(b)(3), because it can
be seen with certainty that there is no possibility that the proposed changes to the Municipal Code will
have a significant effect on the environment.
CONCLUSION:
Apartment units provide a type of housing that is a key to a healthy diversity of housing stock in the
community. Staff believes that the conversion of one or two of the City's apartment communities could
have a major impact on the diversity of the City's housing stock in that it would remove from the market a
significant percentage of the existing rental units. In consideration of the potential impacts Staff has
prepared the attached Condominium Conversion Ordinance. The proposed ordinance would regulate the
conversion of rental apartments to for-sale condominiums and mitigate relocation impacts to tenants.
As previously discussed, Staff has prepared two alternative versions of the Condominium Conversion
Ordinance for consideration by the Planning Commission (Attachments 2-5). Attachments 2 and 3
contain a provision that would make a project with a condominium map subject to the ordinance if the
Department of Real Estate (DRE) has not issued a public report. Attachment 2 is an urgency ordinance
and Attachment 3 is a non urgency ordinance. Attachments 4 and 5 are included should the Planning
Commission decide to recommend adoption of an ordinance that exempts projects with condominium
maps regardless of whether or not the DRE has issued a public report. Attachment 4 is an urgency
ordinance and Attachment 5 is a non urgency ordinance.
Staff recommends that the Planning Commission recommend to the City Council adoption of both an
urgency ordinance and a non urgency ordinance (Attachments 2 and 3 or Attachments 4 and 5). The
urgency ordinance would take effect immediately and ensure that the ordinance is in effect before the City
takes action on the current subdivision applications for condominium conversions. The non urgency
ordinance will provide the City with a backup ordinance in the event that the urgency ordinance is
challenged.
RECOMMENDA TION:
Staff recommends that the Planning Commission: 1) open public hearing; 2) receive Staff presentation; 3)
question Staff and the public; 4) close the public hearing and deliberate; 5) adopt a resolution (Attachment
I) recommending that the City Council adopt a resolution adopting an ordinance regulating the
conversion of existing apartments in the City to condominiums.
G:\PA#\2004\04-044 Condo Conversion ZOA \pcsrl-II-05.doc
11