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some of the - HOUSING Needs Plan2007-2014

Housing Need Allocation Method

The region’s total housing need is allocated to Bay Area jurisdictions through an allocation method. The method contains two distinct components, mathematical equations and rules.
There are two mathematical equations in the allocation method. The first equation is used to allocate total units among jurisdictions. This equation consists of factors, each weighted to indicate relative importance. The second equation is used to divide each jurisdiction’s total need, based on the first formula, into the four income categories, as defined by state law.16
The allocation method also contains a set of rules. These rules address how to allocate units by income, how to handle units in spheres of influence and voluntary transfers of units between jurisdictions and subregions.17
This chapter covers the first mathematical equation, the primary one used to allocate units to jurisdictions. The next several chapters cover the income allocation formula and the allocation rules.

Math Equation Factors

RHNA law delineates the specific factors that must be considered for inclusion in the mathematical equation component of the housing needs allocation method.
These factors are:
1. Water and sewer capacity
2. Land suitable for urban development or conversion to residential use
3. Protected open space - lands protected by state and federal government
4. County policies to protect prime agricultural land
5. Distribution of household growth
6. Market demand for housing
7. City-centered growth policies
8. Loss of affordable units contained in assisted housing
9. High housing cost burdens
10. Housing needs of farm workers
11. Impact of universities and colleges on housing needs in a community.
In devising the formula for allocating units to jurisdictions, staff and members of the Housing Methodology Committee (HMC) had to consider how each of these statutory factors could be incorporated into the mathematical equation component of the allocation method.
Staff and HMC members, as required by law, sought input on the factors and how they could be

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used from every jurisdiction in the Bay Area. On September 15, 2006, ABAG staff surveyed all Bay Area planning directors. Forty-two local jurisdictions responded to the survey. They
offered input on individual factors and had ideas
for additional factors that could be considered. (A detailed summary of survey responses is available at http://www.abag.ca.gov/planning/ housingneeds.)
A second survey was conducted in December

2006. This survey was in response to a new state law (passed in Spring of 2006) requiring that the impacts of either California State Universities or University of California campuses be considered in the housing need allocation method. As a new factor, ABAG staff was required to survey local governments about their student populations.

Staff and most housing methodology committee members agreed that by using household population statistics in the methodology, the appropriate student populations were considered. Household population estimates are inclusive of the entire household population and would therefore account for all people living in homes - including students.
Only the “group quarters” population - those living in college dormitories - are not included
in household population counts. Group quarters population is taken into account in the “total population” estimates. Therefore, the allocation methodology does not propose a specific factor to represent the impact of student populations.
The final allocation method adopted by ABAG’s Executive Board includes factors related to housing, employment and public transit. 18
Each factor is given priority relative to the others through “weighting” in the formula. For example, if one of the factors, e.g., household growth, is determined to be more important than another factor, e.g., transit, the methodology would give household growth a higher weight than transit. If
two or more factors are determined to be of equal priority, they would be equally weighted. State law also allows for “zero weighting” of a required factor,
if an appropriate rationale for the zero weight can be offered by the Council of Governments.
For the Bay Area’s allocation formula, the selected factors and their respective weights are:
• Household growth (45%)
• Existing employment (22.5%)
• Employment growth (22.5%)
• Household growth near existing transit (5%)
• Employment growth near existing transit (5%)

Household growth, existing employment and employment growth are each forecasted in the region’s job, household and employment forecast, Projections 2007.
By applying these factors and weights in the allocation formula, housing would be allocated
to jurisdictions in a manner consistent with state RHNA objectives, statutory requirements, local land use and regional policies. Jurisdictions would then be required to plan for their allocated number of housing units within the housing elements of their general plans.
Specifically, the selected factors result in:
• Housing units directed to areas where local governments are planning housing growth;
• Housing and job growth being planned together and existing jobs-housing imbalances being
addressed;
 

Income Allocation Method

Two primary objectives of the state’s regional housing needs process are to increase the supply of housing and to ensure that local governments consider the housing needs of persons at all income levels.
The income allocation portion of the Regional Housing Needs Allocation method is designed to ensure that each jurisdiction in the Bay Area plans for housing for people of every income.
The method is based on the region-wide distribution of household income. It also considers existing concentrations of poverty within the region.
The percent of households within the Bay Area that fall within each of the state-defined income categories are:

Very-Low, 23 Percent

Up to 50 percent of Median Income

16 Percent, Low

Between 50 and 80 percent of Median Income

19 Percent, Moderate

Between 80 and 120 percent of Median Income

Once a jurisdiction’s total need is calculated, using the formula listed in the last chapter, those total units are then divided using an income allocation method, based on region-wide income distributions. To address concentrations of poverty, each jurisdiction is given 175 percent of the difference between their 2000 household income distribution and the 2000 region-wide household income distribution.

Income Allocation Formula

The first step in calculating the income distribution of a jurisdiction’s housing need allocation is to determine the difference between the regional proportion of households in an income category and the jurisdiction’s proportion for that same category. Once determined, this difference is then multiplied by 175 percent. The result becomes that jurisdiction’s “adjustment factor.”
The jurisdiction’s adjustment factor is added to the jurisdiction’s initial proportion of households in each income category. The result is the total share
of the jurisdiction’s housing unit allocation for each income category.
Using Oakland as an example: the city’s percent of household in the very low income category is 36 percent. The regional percentage in this category is
23 percent of households. The difference between
23 and 36 is -13. This is multiplied by 175 percent
(the adjustment factor) for a result of -22.75. This number is then added to Oakland’s original distribution of 36 percent, for a total share of about
13 percent.

A similar calculation for Piedmont, which has a relatively low proportion of households in the “very- low” income category, results in their adjustment factor amounting to 24. That amount is added to their proportion of households in the “very-low” income category. When added together, Piedmont’s total percent of housing units in that category then becomes 33 percent. Therefore, 33 percent of their allocation must be affordable to families with very- low income.

42 Percent, Above-Moderate

Above 120 percent of Median Income

Jurisdiction Regional Adjustment Total

City Proportion Proportion Difference Multiplier Factor Share

Oakland 36 23 -13 175% -23 13 Piedmont 9 23 14 175% 24 33

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Spheres of Influence

Every city in the Bay Area has a “sphere of influence” or SOI. The SOI boundary is designated by the county’s Local Area Formation Commission (LAFCO). The LAFCO influences how government
responsibilities are divided among jurisdictions and service districts within a county.
A city’s SOI can be either contiguous with or go beyond the city’s boundary. A city is responsible for planning for all areas within its SOI. The SOI is considered the probable future city boundary.
Spheres of Influence must be considered in the regional housing needs allocation process via a “rule” in the Regional Housing Needs Allocation method, if there is projected growth within a city’s SOI. Most SOI areas within the Bay Area
are anticpated to experience growth.
The primary SOI rule for the RHNA method is that each local jurisdiction with land-use permitting authority over its SOI should plan for all the housing needed to accommodate housing growth, existing employment and employment growth within their SOI.
A 100 percent allocation of the housing need to the jurisdiction that has land use control over the area would ensure that the jurisdiction that plans
for accommodating the housing units also receives credit for any units built during the RHNA period.
There are variations in the Bay Area in terms of whether a city or county has jurisdiction over land use and development within unincorporated SOIs. In response to these variations, the following SOI rules apply:
1. In Napa, Santa Clara, Solano, and Sonoma Counties, the allocation of housing need generated by the unincorporated SOI will be assigned to the cities.
2. In Alameda and Contra Costa Counties, the allocation of housing need generated by the unincorporated SOI will be assigned to the county.

3. In Marin County, 75 percent of the allocation of housing need generated by the unincorporated SOI will be assigned to
the city; the remaining 25 percent will be assigned to the county.
These rules reflect the general approaches to SOIs in each county. Adjustments may be needed to better reflect local conditions. To allow flexibility, the methodology includes the following criteria:
1. Adjustments to SOI allocations shall be consistent with any pre-existing written agreement between the city and county that allocates such units, or
2. In the absence of a written agreement, the requested adjustment would allocate the units to the jurisdiction that has permitting authority over future development in the SOI.
Two requests for SOI allocation adjustments arose during the RHNA revision period. These requests were between the County of Santa Clara and the cities of Palo Alto and Mountain View. The final RHNA numbers, in Appendix A, reflect adjustments made to each city and to Santa Clara County.

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When transfering units, jurisdictions are required to retain some very-low and low income units. Jurisdictions also must maintain the same income distribution as initially allocated when transfering units. Both of these requirements ensure that all jurisdictions in the region provide for their “fair share” of affordable housing. Through a transfer, a city or county may not abdicate its responsibility to provide affordable units.

Transfer of Units


After the initial allocation, each local jurisdiction may request that it be allowed to transfer units with one or more willing partners. The transfer must take place in a way that maintains the total need allocation amongst all transfer parties, maintains income distribution of both retained and transferred units, and includes a package of
incentives to facilitate production of housing units.
The transfer rule allows for the transfer of housing need between willing jurisdictions in conjunction with financial and non-financial resources.
It maintains the integrity of the state’s RHNA objectives by preventing any jurisdiction from abdicating its responsibility to plan for housing across all income categories.
Request for transfer of RHNA allocations between jurisdictions must adhere to the following provisions:
1. Have at least two willing partners and the total number of units within the group requesting the transfer cannot be reduced.
2. Include units at all income levels in the same proportion as initially allocated.
3. All members of the transfer group must retain some allocation of very low and low income units.
4. The proposed transfer must include a specifically defined package of incentives and/or resources that will enable the jurisdiction(s) receiving an increased allocation to provide more housing choices than would otherwise occur absent the transfer and the accompanying incentives or resources.
5. If the transfer results in a greater concentration of very low or low income units in the receiving jurisdiction, the effect must be offset by findings by the members of the transfer group that address the RHNA objectives.
For example, the findings might include: (a) there is such an urgent need for more housing choices in those income categories that the opportunity to effect more housing choices in these categories offsets the impacts of over-concentration; or (b) the package of incentives and/or resources are
for mixed income projects; or (c) the package of incentives and/or resources are for “transitional” housing for very low or low income households

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being relocated for rehabilitation of existing very low or low income units; or (d) the package of incentives and/or resources are for additional
units that avoid displacement or “gentrification” of existing communities.
6. For the transfer of very low and low income units, there are restrictions that ensure the long- term affordability of the transferred units.

7. Transfers must comply with all other statutory constraints and be consistent with the RHNA objectives.
 

Innovative, Sustainable Micro-Infill

When in doubt about how your city may accommodate its new housing allocation, going small may be an option.

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San Mateo Subregion


The County of San Mateo, in partnership with all twenty cities in the county, formed a subregion. The formation of a subregion, for the purposes of conducting the RHNA, is allowed by state law.
The San Mateo subregion designated the City/ County Association of Governments (C/CAG) as the entity responsible for coordinating and implementing the subregional RHNA process.
Upon the State’s determination of the total regional need, as required by law, ABAG assigned a share
of the regional need to the San Mateo subregion. According to the law, the subregion’s share is to
be “in a proportion consistent with the distribution of households” from 2007-2014 in Projections

2007. San Mateo’s share of units was also assigned by income category. The income distribution was determined by the regional average distribution of income.

San Mateo County’s household growth during the RHNA period, 2007-2014, is estimated at 12,184 households. Household growth in the region over the same period is estimated at 166,060. San
Mateo County’s regional share of household growth is 7.3 percent.
Applying this percent to the total regional housing need of 214,500 units gives San Mateo County a minimum subregional housing need assignment of
15,738 units, or 7.3 percent of the total regional need.

Subregion Allocation Method

The San Mateo subregion was responsible for completing its own RHNA process. Their process paralleled, but was separate from, the Bay
Area’s RHNA process. San Mateo created its own methodology, issued draft allocations, and handled the revision and appeal processes. They also issued final allocations to members of the subregion.
Although the subregion worked independently
of the regional RHNA process, ABAG is ultimately responsible for ensuring that all of the region’s housing need is allocated. Thus, if the subregion were to fail at any point in its attempt to develop a final RHNA allocation for the subregion, ABAG
would have had to complete the allocation process for the members of the subregion.

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The San Mateo subregion housing allocation method mirrored ABAG’s final method. The same factors and weights were used, as documented on page 23 of this report.
Once units were allocated, using the ABAG formula, several cities in San Mateo agreed to transfer units. Transfering cities were subjected to the same rules regarding transfers, as listed on page 37.
Final city-level allocations for the San Mateo
Subregion are listed in Appendix A.

San Mateo Subregion Allocation

Very Low 3,588

Low 2,581

Moderate 3,038

Above-Moderate 6,531

Total 15,738

Concluding RHNA


The Regional Housing Needs Plan, as fully described in this document, took over two years to develop. This plan’s success is largely due to the commitment and hard work of the many individuals involved.

We arrived at the final methodology only after numerous committee and public meetings that took place throughout the region. Outside of committee or public meetings, we provided information to people over the telephone, through newsletters, emails and our web site.
This outreach generated many comments on our regional population, household and job forecast, Projections 2007. We also received feedback on numerous draft RHNA methodologies.
Even now, with our method complete and after all the housing needs numbers have been allocated, our outreach continues. There remains great interest in the RHNA process, how the allocation formula works and what is now required of local governments.
Once draft allocations for individual jurisdictions were produced, only 19 of the Bay Area’s 109 jurisdictions asked for revisions to their numbers. Out of those requests, one was granted. Five of the
19 jurisdictions then appealed their allocations
to an ABAG Executive Board RHNA Appeals Sub- committee. This sub-committee was made up of local elected officials.
Of the five appeals, one was granted. Another appeal was resolved through a trade made between jurisdictions. Limited appeals are evidence of a highly constructive RHNA process.
While RHNA may have its difficulties and be perceived as controversial in many jurisdictions, our process was widely recognized as fair, professional, cooperative and open. And in the end, many would agree that this 2007-2014 RHNA is progressive
in addressing our region’s significant housing, transportation and environmental issues.
We hope you have found this report useful in explaining all aspects of RHNA. If further information is needed, please visit our Bay Area RHNA web site at: www.abag.ca.gov/planning/ housing needs.
Thank you.

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Endnotes

1 All data in the “San Francisco Bay Area” chapter, except where noted, is from Association of Bay Area Governments, Projections 2007

2 Affordability percentages calculated using California Association of Realtors “First-time Buyer Housing Affordability Index”, Available at http://www.car.org/index.php?id=MzcxMTU= Note: Formula adjusted to reflect no more than 30 percent of income toward total mortgage vs. recommended 40 percent; May 2008

3 California Home Sale Activity by City, Home Sales Recorded in the Year

2007, DQNews, Available at http://www.dqnews.com/Charts/Annual- Charts/CA-City-Charts/ZIPCAR07.aspx

4 California State Department of Finance, E-5 Report, City/County

Population and Housing Estimates, January 1, 2008

5 All transportation data cited in the “Transportation” section comes from the Metropolitan Transportation Commission, Bay Area Transportation: State of the System 2006, p. 3-4

6 Affordability percentages calculated using California Association of Realtors “First-time Buyer Housing Affordability Index”, Available at http://www.car.org/index.php?id=MzcxMTU= Note: Formula adjusted to reflect no more than 30 percent of income toward total mortgage vs. recommended 40 percent; May 2008

7 Metropolitan Transportation Commission, Transportation 2030, percentages calculated from 2005-2030

8 Bay Area Air Quality Management District. BAAQMD Bay Area 2005

Ozone Strategy. January 2006.

9 Bay Area Air Quality Management District. Ambient Air Quality Standards & Bay Area Attainment Status. January 2007. Available at: www.baaqmd.gov/pln/air_quality/ambient_air_quality.htm.

10 Cummins, S. K. and Jackson, R. “The Built Environment and Children’s

Health.” 2001. Pediatric Clinics of North America 48(5): 1241-1252.
11 California Department of Transportation. 2004 HICOMP Report. June
2006: California Department of Transportation, District 4, Office of Highway Operations. “Information Memorandum: Year 2002 Bay Area Freeway Congestion Data.” 2003

12 2005 American Community Survey. U.S. Census Bureau.

13 Ewing, Reid, Bartholomew, Keith, et al. “Growing Cooler: The Evidence of

Urban Development on Climate Change.” Urban Land Institute, p. 4.

14 California Department of Housing and Community Development, Overview of Housing Element Law, Available at: http://www.hcd.ca.gov/hpd/housing_ element/index.html

15 Fassinger, Paul, 2007-2014 Regional Housing Need Allocation, Staff memo to ABAG’s Executive Board, April 17, 2007

16 Very-low income is 50 percent or less of area median income (AMI), low- income is 50 to 80 percent of AMI, moderate-income is 80 to 120 percent of AMI, above-moderate is 120 percent or more of AMI.

17 For more details about these sections of the methodology, see ABAG’s website at www.abag.ca.gov/planning/housingneeds.

18 Adopted by ABAG’s Executive Board, January 2007.

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Appendix A: Regional Housing Needs Allocation, 2007 to 2014

San Francisco Bay Area Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

SF Bay AreaTotal

48,840

35,102

41,316

89,242

214,500

Alameda County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Alameda

482

329

392

843

2,046

Albany

64

43

52

117

276

Berkeley

328

424

549

1,130

2,431

Dublin

1,092

661

653

924

3,330

Emeryville

186

174

219

558

1,137

Fremont

1,348

887

876

1,269

4,380

Hayward

768

483

569

1,573

3,393

Livermore

1,038

660

683

1,013

3,394

Newark

257

160

155

291

863

Oakland

1,900

2,098

3,142

7,489

14,629

Piedmont

13

10

11

6

40

Pleasanton

1,076

728

720

753

3,277

San Leandro

368

228

277

757

1,630

Union City

561

391

380

612

1,944

Unincorporated

536

340

400

891

2,167

Alameda Total

10,017

7,616

9,078

18,226

44,937

43

Contra Costa County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Antioch

516

339

381

1,046

2,282

Brentwood

717

435

480

1,073

2,705

Clayton

49

35

33

34

151

Concord

639

426

498

1,480

3,043

Danville

196

130

146

111

583

El Cerrito

93

59

80

199

431

Hercules

143

74

73

163

453

Lafayette

113

77

80

91

361

Martinez

261

166

179

454

1,060

Moraga

73

47

52

62

234

Oakley

219

120

88

348

775

Orinda

70

48

55

45

218

Pinole

83

49

48

143

323

Pittsburg

322

223

296

931

1,772

Pleasant Hill

160

105

106

257

628

Richmond

391

339

540

1,556

2,826

San Pablo

22

38

60

178

298

San Ramon

1,174

715

740

834

3,463

Walnut Creek

456

302

374

826

1,958

Unincorporated

815

598

687

1,408

3,508

Contra Costa Total

6,512

4,325

4,996

11,239

27,072

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Marin County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Belevedere

5

4

4

4

17

Corte Madera

66

38

46

92

244

Fairfax

23

12

19

54

108

Larkspur

90

55

75

162

382

Mill Valley

74

54

68

96

292

Novato

275

171

221

574

1,241

Ross

8

6

5

8

27

San Anselmo

26

19

21

47

113

San Rafael

262

207

288

646

1,403

Sausalito

45

30

34

56

165

Tiburon

36

21

27

33

117

Unincorporated

183

137

169

284

773

Marin Total

1,095

754

977

2,056

4,882

45

Napa County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

American Canyon

169

116

143

300

728

Calistoga

17

11

18

48

94

Napa

466

295

381

882

2,024

St. Helena

30

21

25

45

121

Yountville

16

15

16

40

87

Unincorporated

181

116

130

224

651

NapaTotal

879

574

713

1,539

3,705

San Francisco County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

San Francisco

6,589

5,535

6,754

12,315

31,193

San Francisco Total

6,589

5,535

6,754

12,315

31,193

46

San Mateo County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Atherton

19

14

16

34

83

Belmont

91

65

77

166

399

Brisbane

91

66

77

167

401

Burlingame

148

107

125

270

650

Colma

15

11

13

26

65

Daly City

275

198

233

501

1,207

East Palo Alto

144

103

122

261

630

Foster City

111

80

94

201

486

Half Moon Bay

63

45

53

115

276

Hillsborough

20

14

17

35

86

Menlo Park

226

163

192

412

993

Millbrae

103

74

87

188

452

Pacifica

63

45

53

114

275

Portola Valley

17

12

14

31

74

Redwood City

422

304

358

772

1,856

San Bruno

222

160

188

403

973

San Carlos

137

98

116

248

599

San Mateo

695

500

589

1,267

3,051

South San Francisco

373

268

315

679

1,635

Woodside

10

7

8

16

41

Unincorporated

343

247

291

625

1,506

San Mateo Total

3,588

2,581

3,038

6,531

15,738

47

Santa Clara County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Campbell

199

122

158

413

892

Cupertino

341

229

243

357

1,170

Gilroy

319

217

271

808

1,615

Los Altos

98

66

79

74

317

Los Altos Hills

27

19

22

13

81

Los Gatos

154

100

122

186

562

Milpitas

689

421

441

936

2,487

Monte Sereno

13

9

11

8

41

Morgan Hill

317

249

246

500

1,312

Mountain View

571

388

488

1,152

2,599

Palo Alto

690

543

641

986

2,860

San Jose

7,751

5,322

6,198

15,450

34,721

Santa Clara

1,293

914

1,002

2,664

5,873

Saratoga

90

68

77

57

292

Sunnyvale

1,073

708

776

1,869

4,426

Unincorporated

253

192

232

413

1,090

Santa ClaraTotal

13,878

9,567

11,007

25,886

60,338

48

Solano County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Benicia

147

99

108

178

532

Dixon

197

98

123

310

728

Fairfield

873

562

675

1,686

3,796

Rio Vista

213

176

207

623

1,219

Suisun City

173

109

94

234

610

Vacaville

754

468

515

1,164

2,901

Vallejo

655

468

568

1,409

3,100

Unincorporated

26

16

18

39

99

Solano Total

3,038

1,996

2,308

5,643

12,985

49

Sonoma County Housing Needs Allocation, 2007 to 2014

Very Low, <50%

Low, <80%

Moderate, <120%

Above Moderate

Total

Cloverdale

71

61

81

204

417

Cotati

67

36

45

109

257

Healdsburg

71

48

55

157

331

Petaluma

522

352

370

701

1,945

Rohnert Park

371

231

273

679

1,554

Santa Rosa

1,520

996

1,122

2,896

6,534

Sebastopol

32

28

29

87

176

Sonoma

73

55

69

156

353

Windsor

198

130

137

254

719

Unincorporated

319

217

264

564

1,364

Sonoma Total

3,244

2,154

2,445

5,807

13,650

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