Healdsburg to let voters decide annual growth cap

The Healdsburg City Council took several steps this week to try to spur the construction of workforce and even upper-middle-class housing in a town with some of the highest real estate prices in Sonoma County and scant rental vacancies.

After previously agreeing to ask voters to scrap an annual growth cap that limits the number of new market-rate homes to an average of 30 per year, the council voted 3-1 vote late Monday to work on a new ordinance that would allow more than twice as many new homes, or an average of 70 units per year.

But selling the idea to voters could prove challenging.

“We will run a very aggressive campaign against this proposal,” said Jim Winston, the retired businessman who authored the current Growth Management Ordinance approved by voters in 2000. It was enacted amid concern that growth needed to be more orderly and steady in light of the large Parkland Farms subdivision that had just been built at the edge of town.

But a majority of City Council members view the current growth cap as too restrictive. They say it hampers efforts to encourage multifamily housing development at a time when building permits are limited.

Councilman Eric Ziedrich said growth controls in Healdsburg have led to a dearth of middle-class housing.

“We are building subsidized housing and McMansions. Everything else hasn’t been built,” he said.

The city has been struggling for years to come up with a new formula that would stimulate construction of less expensive housing, but provide assurance it would not lead to rampant development and threaten Healdsburg’s cherished smalltown charm.

The latest version would allow for 420 units to be built over a six-year period beginning in 2017. Most of those - 240 units - would be reserved for multifamily units. The rest - 180 - would be for single-family housing.

But skeptics like Winston said the new ordinance will be “toothless” because “it can be changed at the whim of the City Council. It only takes three votes.”

He asserted the only people who will support the “gutting” of the existing growth ordinance “will be those who will benefit from all this explosive growth and financial gain.”

Councilwoman Brigitte Mansell also expressed reservations about having growth restrictions that can be changed at any time by future City Councils. “Who will be up here?” she said of the composition of the council.

Plus, she said, “I don’t know if it will resolve our problem in terms of getting the right kind of housing.”

Winston worried the added new building permits could be eaten up all at once.

But Councilman Gary Plass said it is unlikely all of the available 420 units will be snapped up immediately, or that it will induce sprawl. He said the city is constrained by an urban growth boundary and barriers such as the Russian River to the east, agricultural lands to the north and west, and Windsor to the south.

The council was unanimous Monday on another front to address the affordable housing crunch. Council members agreed to ask voters in November to raise the city’s hotel room tax by 2 percentage points, from the current 12 percent to 14 percent. But because the hoteliers and inns already charge an extra 2 percent to pay for marketing and promotion, the effective room tax would go to 16 percent, the highest in Sonoma County.

The estimated $530,000 it would raise annually would be directed to affordable housing programs and services.

As a special tax, it would require two-thirds voter approval.

Mayor Tom Chambers said the tax hike will provide credence the city is serious about addressing the affordable housing issue.

City Council members are also in agreement to expand the income guidelines for what defines deed-restricted, affordable housing units that can be subsidized by the city, as well as be exempt from a new growth cap. Instead of affordable housing being considered 120 percent or less of median income, it would be expanded to 121 percent to 160 percent of median, which ranges from between about $100,000 and $132,009 for a family of four.

Chambers said many people in that income range need help to afford a $525,000 house even if they could find one that low in Healdsburg.

Some speakers on Monday said lower income earners, like hotel and restaurant workers who need housing the most, could be overlooked if the income limits defining affordable housing are raised.

The city has been looking at a number of other changes to spur lower cost units, such as revising the housing impact fee schedule.

The city’s Housing Action Plan recommends creating more middle income housing in part by requiring developers to have 30 percent of their projects be affordable, instead of the current 15 percent requirement.

Developers could still opt out of building the units themselves by paying an “in lieu” fee. But that would be $47,000 per unit, up from the current maximum fee of $15,000.

You can reach Staff Writer Clark Mason at 521-5214 or clark.mason@pressdemocrat.com