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CA Department of Housing and Community Development (HCD)

Dear Mr. Campora: 

            This letter is submitted on behalf of the Novato Homeowners Association (NHA). We represent the interests of residents that live in Novato and own homes throughout Novato. We are part of a grassroots effort to reach out to state and local government to have a voice in the creation of the Housing Element and the update of the General Plan. Our members include participants in the Ad Hoc Working Group that developed the list of sites offered to HCD for the current housing element. We are involved and caring individuals that want to support zoning for affordable housing that blends seamlessly with the existing neighborhoods in Novato. We do not represent developers or any entities that stand to profit from these ventures. 

             The city of Novato and its residents have spent a great deal of time and energy, with much public discourse, to complete the current Housing Element submitted for your approval. Novato has identified sites that are appropriate, and can be easily built in a good faith effort to meet the RHNA requirements. We have made one significant request in the development of the Housing Element and that is a density that fits both the character of our city and the manner in which future housing will be zoned. Our city planners have done an excellent job of providing evidence to support the feasibility of the sites proffered being developed at this lower rate. They have shown that the current areas that were developed all fall within that density range. They have offered zoning changes to support and streamline AH development to insure timely and cost effective projects. They have done an outstanding job of creating a plan that can lead to more affordable housing projects here in Novato. 

            Our request in this housing cycle for flexibility on the density issue has been challenged by groups that consist of the same residents who claim that no matter how much affordable housing Novato develops it is not enough to meet the needs of the entire county's growth. These groups have members that will profit from Affordable Housing that is developed in Novato. They have already influenced the planning process by bringing their complaints to HCD before the Housing Element had even left the offices of the city planners. It would seem that no reasonable amount of compromise is possible though we have continued to try and negotiate with them. At this point we have responded by saying it is not our role to provide all of Marin with a single city in which to put the remaining affordable housing that is needed but rather to build housing based on our ability to support the families that will live here. In other words we need fiscally sustainable planning to become a part of our commitment to Affordable Housing in Novato. 

            While we understand that ABAG has given Novato a density of metropolitan due to its inclusion in Marin County, its population, and its proximity to San Francisco, we wish to acknowledge the suburban nature of our town. The information submitted below demonstrates that we are indeed financially and physically a suburban community.   We hope you will agree that we have done and are doing all the necessary work to provide a valid housing element and to encourage AH developers to work within our city on projects that will serve low income families such as seniors, people with disabilities and individuals and families living below the poverty level. As a matter of record, much of the information below would clearly indicate that Novato has created sufficient housing to meet the needs of its residents. If Novato were allowed to develop organically it would likely do so at a much slower pace than what ABAG estimates but in order to meet state mandates we have provided exactly what has been asked of us. 

            The following information is submitted to show why the current Housing Element, as drafted, is not only reasonable but exceeds the actual needs and requirements of Novato. Moreover we do not wish to endanger the fiscal stability of our city. We recognize and acknowledge our obligation and have provided a plan that will both meet the state requirements and at the same time create community support for affordable housing development in Novato. Please understand the extent to which community support is fragile if there is no compromise offered based on the request to look at lower density as a means of achieving smart growth. 

  1. 1.Novato has overbuilt affordable Housing in Marin, especially in the categories of “very low” and “low”. 

            The state of California addresses the distribution of low and very low housing in an equitable manner in Government Code Section 65584(d). This requires “Increasing the housing supply and the mix of housing types, tenure, and affordability in all cities and counties within the region in an equitable manner, which shall result in each jurisdiction receiving an allocation of units for low- and very low income households.” This was clearly not the case from 1999 to 2006. Even though Novato is 20% of the population of Marin County, the fact is that from 1999 to 2006 the city created 51.4% of the affordable housing in Marin County.   The Association of Bay Area Governments (ABAG) report: “A Place to Call Home: Housing in the San Francisco Bay Area 2007” provides a breakdown of affordable housing Regional Housing Needs Allocations (RHNA) and Permits Issued by cities in the county of Marin from 1999 to 2006. 

            RHNA allocated 1,241units with the category of Very Low Income Housing for Marin County. During this element, a total of 528 permits were issued and 297 were from Novato or 56%. Five of the eleven cities in Marin (Belvedere, Corte Madera, Fairfax, Ross and San Anselmo) had no permits issued. Larkspur had 13% of their allocated goal, San Rafael had 6% and Tiburon had 15%. 

            RHNA allocated 618 Low Housing for Marin County. A total of 751 permits were issued, and 527 were from Novato or 85%. Six of the eleven cities in Marin (Belvedere, Corte Madera, Fairfax, Ross, San Anselmo and Sausalito) had no permits issued. Novato was allocated 242 Low Housing units and 527 permits were issued or 218% more than allocated by RHNA. Larkspur had 21% of their allocated goal, San Rafael had 42% and Tiburon had 21%. 

            RHNA allocated 1,726 Moderate Housing for Marin County. A total of 1040 permits were issued and 496 were from Novato or 48%. Six of the eleven cities in Marin (Corte Madera, Fairfax, Ross, San Anselmo, Sausalito and Tiburon) had no permits issued. Larkspur had 4% of their allocated goal, San Rafael had 69% and Mill Valley had 73%. 

            RHNA allocated 2,930 Above Moderate Housing for Marin County. A total of 3,453 permits were issued and 1,646 were from Novato or 48%. All eleven cities in Marin had permits issued. Novato was allocated 1,130 Above Moderate Housing units and 1,646 permits were issue or 146% more than allocated. 

  1. 2.The Housing Novato has created, and the housing they are now being requested to build simply does not correlate to the actual census data from 2000 to 2010.

             The census data (www.bayareacensus.ca.gov) indicates Novato population from 2000 - 2010 grew from 47,630 to 51,904 which is an 8.97% growth and an increase of 4,274. The average household was 2.52 persons. This implies a total household growth of 1,755. In the 1999 - 2006 housing cycle Novato built 2,966 affordable housing units. Thus Novato built 1,211 more affordable housing units in a seven year span than the TOTAL household increase in this time period. More importantly, to directly complete a comparison for 2000 – 2010 for affordable housing and households affordable housing in 1999 would have to be removed and the affordable housing built in 2007, 2008, 2009 and 2010 would have to be added and I do not have this information. Given one year (1) would be removed and four (4) years added it is expected the 1,211 difference would be the minimum difference. (See attached worksheet.) 

            The current housing element plans to build another 1,241. Thus, from 1999 to 2014 Novato is being asked to build a combined number of 4,207 affordable housing units while total household growth from 2000 to 2010 was a total of 1,755 households? The total number of units proposed far outstrips the growth in total households, effectively making Novato the “epicenter” for Affordable Housing in Marin, which is contrary to both State Law as well as common sense.

            The combine affordable housing of 4,207 units times the 2.52 average existing household size yields total affordable housing that would house 10,602 people, or nearly 20% of the City’s population. This is coming at a time when Census data shows that in 2000 to 2010 the population of Novato only grew by 4,274. A large part of that growth was obviously not natural market forces (given the well documented issues with housing), but was obviously driven by policies in place that favor building of housing by “non-profits” at a time when “for profit” builders could not build a feasible number of units due to issues with natural demand, financing, etc. The “non-profit” developers of affordable housing have a built in advantage over “for profit” developers, given the simple fact the properties they develop are granted tax exempt status for 55 years, essentially yielding no ongoing revenue to the City, and thus further straining budgets for the City (whose largest single revenue item is property taxes). The proposed level of housing simply is inequitable, and makes no sense for Novato. Each new household added adds to city expenses, and adding to expenses without a commensurate increase in revenue will either result in lower level services provided by the city, or the need for additional revenue from other sources. Both the Novato city budget and the Novato Unified school district currently have structural budget deficits, which will only be exacerbated with material additions of non property tax paying housing. The likely end result will be a likely decline in homeowner property values, and escalating structural deficits. The code simply calls for the projects to be feasible, and (by inference) that should also include being financially appropriate for all stakeholders in Novato.

 3.Novato cannot fiscally support more affordable housing with the city budget. Novato has the lowest city revenue per person of all of Marin as well as the surrounding counties.

             Novato’s current general fund budget (from all sources) hovers at approximately $30MM per year, and property taxes represent the single largest revenue source, followed by sales taxes. Novato’s budget indicates general fund revenue (2010) of under $416 per resident, which is at only 44% of the remaining cities of Marin (excluding Novato), whose average is at $952. In fact, Novato is also well below the Sonoma County City average of $489. Novato is designated as Metropolitan, while Sonoma is designated as Suburban, which makes absolutely no sense. 

            Isolating the general fund overall budget to residents (excluding businesses from the analysis to simplify) results in the following: Novato has revenues of just under $1,480 per resident, and expenses essentially mirror this (as they must). When property taxes (again isolating businesses) comprise approximately $600 per resident (or 40% of revenues)-the ultimate sustainability of Novato to carry such a disproportionate burden in comparison to the remainder of the County is, ultimately, a strategy that will ultimately yield either higher costs to existing residents or reduced overall service levels-with service levels having already been deeply cut, there is scant ability to reduce further.

 4.Novato’s schools are currently running a $3.3 million dollar structural deficit. As we add more socioeconomically disadvantaged students to the public schools system in Novato we are not able to provide them with education sufficient to meet their needs. Limited proficiency in English Language Arts and Math is demonstrated by the state test scores and the fact that the district is in its third year of Program Improvement (PI).

             Each year the district's deficit grows bigger because we cannot afford to lose more teachers and yet we cannot afford to pay teachers salaries that will keep them in our schools once they are trained. The attrition rate is approximately 25% due to teacher salaries being the lowest in the county. In 2011 we closed Hill Middle School and redistributed the students to our two remaining middle schools in an effort to cut costs. We have been told that school consolidation is one of the remaining means we have to balance our budget. Consolidation is "code" for school closures. The children whose education is most impacted as shown by schools in Program Improvement, are children from low income families. Their scores fall significantly below their peers. There is no clear explanation of why this persists or what must be done to fix the problem. NUSD's historically poor success rate in educating children from socioeconomically disadvantaged families has created schools in Program Improvement because federal goals based on No Child Left Behind are not being met.

             Our district is in its third year of PI, and we have three separate elementary schools in PI, two in their second years and one it its fifth year. Our lack of success in educating these children is reflected in test scores where proficiency rates are only 25% to 30% in English Language Arts.

Only 15% of this population is English Language Learners. That means low income English speaking students are not mastering the language at a sufficient rate to meet federal NCLB goals. Since 2003 the percentage of students receiving Free and Reduced Lunch has gone from 16% to 28%. Out of 8000 students approximately 28% to 30% belong to the socioeconomically disadvantaged subgroup. This is huge jump and while overall enrollment of other subgroups is declining, enrollment of economically challenged children is increasing. This is reflected by the fact that Novato's market rate housing is still far more reasonably priced that market rate housing in other cities in Marin.

             Reviewing this information outlined above, it is absolutely clear that the result of this mandated housing distribution in Marin County resulted in Novato serving as the prime source of both “very low” and “low” affordable housing, as well as all other affordable housing, for the other cities in Marin. The increased concentration of affordable housing in Novato results in not less traffic but actually more traffic in Marin. This requires people to commute from Novato to other Marin cities due to the lack of affordable housing in those other cities and is directly at odds with the stated goals of SB 375. Further, this also appears to be in violation of Government Code Section 65584(d).

We sincerely believe it is absolutely essential that the HCD reviews for Novato in the current cycle be flexible, respect the thousands of hours of hard work completed, and acknowledge that all citizens of Novato be respected and treated equally. We would like to formally request that the submitted housing element be approved as submitted, without need for additional density or sites.

Please provide your response to:

Novato Homeowner Association

P.O. Box 1251

Novato, CA 94948-1251

 

 

Sincerely,

 

 

Al Dugan

On behalf of the Novato Homeowners Association

 

Cc:      City Council of Novato

                        Governor Brown

                        Ms. Melinda Coy

 

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