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070 of 1995 - Enacting 18.67: Mitigation of Residential Housing Loss from Rezoning • 0 95-1 , 0 95-30 SALT LAKE CITY ORDINANCE No. 70 of 1995 (Housing Mitigation) WHEREAS, commercial expansion into established residential neighbors has materially reduced the stock of affordable housing in the City, particularly in the Central City and Capitol Hill neighborhoods which have lost nearly 30, 000 units over the past 30 years; and WHEREAS, the loss of housing has a significant deleterious impact on the vitality and economic health of the City; and WHEREAS, the City has experienced a decline of population of about 10 , 000 persons for each decade since 1960, despite Salt Lake County' s growth from approximately 383, 000 to 726, 000 persons between the years 1960 and 1990; and WHEREAS, despite growth in the gross number of housing units existing within the City, demographic changes in the size of household members has resulted in a shortage of affordable housing, particularly near the University of Utah, in the Central City area, and in the Capitol Hills neighborhoods; and WHEREAS, the forces driving the demolition of existing housing units include : (a) commercial and institutional enterprises ' expansion in areas near or within residential neighborhoods; and (b) land speculators ' assemblage of land for future commercial development or exploitation; and WHEREAS, housing stock that has been demolished, due to such economic and growth forces, has not been replaced; and WHEREAS, the City recently adopted a new zoning ordinance that is intended to align regulations and master planning policies in order to substantially reduce the need to approve nonresidential parking lots in residential zones or to rezone residential properties containing dwelling units to nonresidential zoning classifications; and WHEREAS, City changes in zoning, to permit commercial uses that involved the demolition of existing housing stock, has almost always resulted in substantial increases in economic value to the landowner/developer; and WHEREAS, sometimes existing housing may be allowed to deteriorate, because profit incentives exist in the form of expense avoidance and accelerating or forcing commercialization to remedy the contrived blight; and WHEREAS, the City has commissioned and accepted a study from Wilkstrom Economic and Planning Consultants, Inc . , which study analyzes the causes and potential mitigation options regarding the loss of affordable housing; and WHEREAS, the City Council is of the opinion that housing loss mitigation should be an essential precondition to future legislative actions that would rezone land that would result in the demolition of existing housing stock, in order to offset the resulting harm to the City; and WHEREAS, any such mitigation must lawfully accommodate constitutionally protected property rights; NOW, THEREFORE, the Municipal Council of Salt Lake City 2 adopts the following Housing Mitigation Ordinance . AN ORDINANCE ENACTING CHAPTER 18 . 97 OF THE SALT LAKE CITY CODE, RELATING TO MITIGATION OF RESIDENTIAL HOUSING LOSS FROM REZONING. Be it ordained by the City Council of Salt Lake City, Utah: SECTION 1 . That Chapter 21 . 94 of the Salt Lake City Code, relating to housing loss mitigation, be, and the same hereby is, enacted as follows : 18 .97 . 010 Purpose. The City has experienced a loss of important affordable housing stock, particularly in its Central City and Capitol Hill areas due to commercial expansion. It is the objective of the City to mitigate the adverse impacts of such losses, when zoning changes are sought to accommodate an expansion of commercial uses, with due consideration for vested or protected property rights . 18 .97 . 020 Housing Mitigation Condition Precedent to Rezoning or Permits for Parking Lots, in Areas Containing Residential Units. A. Housing Mitigation Plan. Any petition for a conditional use permit to authorize or expand vehicle parking in residential zones and any petition for a zoning change that would permit a non-residential use of land, that includes within its boundaries residential dwelling units, may not be approved until a Housing Mitigation Plan shall have been approved by the City. The Housing Mitigation Plan shall be proposed and submitted to 3 the City' s Planning Director and the Director of Community and Economic Development by the petitioner not less than 20 days prior to final action by the City on such a petition and be accompanied by a Housing Impact Statement . B. Housing Impact Statement. The Housing Impact Statement shall : (a) identify the essential adverse impacts on the residential character of the area subject of the petition; (b) identify by address any dwelling units targeted for demolition, following the granting of the petition; (c) separately for each dwelling unit targeted for demolition, state its current fair market value, if that unit were in a reasonable state of repair and met all applicable building, fire and health codes; (d) state the number of square feet of land zoned for residential use that would be rezoned or conditionally permitted to be used for purposes sought in the Petition, other than residential housing and appurtenant uses; and (e) specify a mitigation plan to address the loss of residential zoned land, residential units or residential character. 18 . 97 . 030 Options for Mitigating Residential Loss. Petitioners subject of this chapter may satisfy the need for mitigation of any residential housing unit losses by any one of the following three methods : A. Replacement housing. The petitioner may agree, in a legal form satisfactory to the City Attorney, to construct the same number of/residential dwelling units proposed for demolition, within: (1) the City Municipal Council district in 4 which the land subject of the petition is located; or (2) an adjoining council district, if the mitigation site is within a one(1) mile radius of the demolition site. Any such agreement shall include adequate security to guarantee completion, within two years of the granting of any rezoning or conditional use permit. B. Fee Based on Difference Between Housing Value and Replacement Cost. The petitioner may pay to the City Housing Trust Fund the difference between the fair market value of the housing units planned to be eliminated or demolished and the replacement cost of building new units of similar square footage and meeting all existing building, fire and other applicable law, excluding land values. C. Fee, Where Deteriorated Housing Exists, Not Caused by Deliberate Indifference of Landowner. (1) Request by Petitioner for Flat Fee Consideration. In the event that a residential dwelling unit is targeted or proposed for demolition is in a deteriorated state from natural causes, such as fire, earthquake or aged obsolescence and not occasioned by the deliberate acts or omissions to act on the part of the petitioner or his predecessors in interest, which reduces a dwelling unit's fair market value or habitability as a residential dwelling unit, the petitioner may request an exemption from the above two methods of mitigation from the Director of the City's Department of Community of Economic Development, as provided 5 below. (2) Required Facts of Natural Deterioration; Increase Fair Market Value of Units to be Demolished. The petitioner may submit to the Director of the City's Department of Community and Economic Development every fact known to support the proposition that the residential dwelling units were not purposely allowed to deteriorate by lack of reasonable maintenance, ordinary and prudent repairs or other acts or omissions to act, the value of the units targeted or proposed for demolition may be increased to the fair market value that the units would have, if each unit was in a state of habitability and minimally meeting applicable building codes and other applicable law, excluding land value. This enhanced value will then be applied in thus computing any housing mitigation payment provided in subsection "B", above. (3) Flat Fee Mitigation Payment. In the event that the petitioner actually and reasonably demonstrates to the City's Director of Community and Economic Development that the costs of calculating and analyzing the various methods of mitigation are unreasonably excessive in relationship to the rough estimated costs of constitutionally permitted mitigation, the Department Director may recommend to the City Council that a flat rate be paid by the petitioner to the City's Housing Trust Fund a sum not in excess of $3,000 per dwelling unit to be demolished. The $3,000 flat fee 6 shall be adjusted for inflation as of January 1 of each calendar year following the adoption of the ordinance, based on the Consumer Price Index for the previous 12 months, or 3 percent, whichever result is less. 16.97.040 Housing Mitigation Justification to Council. A. Report to City Before Rezoning Hearings. The Director of the Department of Community and Economic Development shall prepare a report justifying the method of housing mitigation recommended by the Director, including the factual basis upon which it is premised and a factually based justification for the recommendation. This report will be submitted to the Planning and Zoning Commission in sufficient time for its deliberation concerning the advisability of effectuating the petitioner's request for a zoning change. The Petitioner may, likewise, submit its proposal and the factual and legal justification for mitigation, if any, or why the Director's recommendations are appropriate or should be modified. The Commission will include in its evaluation an evaluation of the adequacy of the housing loss mitigation plan, proposed by the petitioner and that recommended by Director of the Department of Community and Economic Development. B. Report to Planning Director on Conditional Use Permit Petitions. In the event of a conditional use permit, said report will be submitted to the City's Planning Director. The report will be duly evaluated, considered and included in the decision regarding any conditional use permit. The Planning Director will 7 memorialize, in writing, the factual basis supporting any decision dealing with the housing mitigation component of any such conditional use permit and include this finding and evaluation in the file for due consideration should there be an appeal relating thereto. 18.97.050 Nature and Review of Alleged Unconstitutional or Illegal Housing Loss Mitigation. Should any petitioner or other person, corporation or entity claim that this Chapter 97 or any application of it is illegal, unconstitutional or may constitute or effectuate an unconstitutional taking of property without appropriate compensation, either per se or as applied, the City shall be notified as soon as practicable and the provisions of Chapter 66, Title 2 of the City Code complied with, regarding each such claim. SECTION 2. This Ordinance shall become effective on its first publication. Passed by the City Council of Salt Lake City, Utah, this 19th day of September , 1995 CHA PERSO ATTEST: C44 CITY R CORDE I Gh e Dept-Ill 8 Transmitted to the Mayor on September 20, 1995 Mayor's Action: XXX Approve etoed 242 MAYOR ATTEST: CITY RECORDER/Cihtec Oepu+j ter r�'�7RAfc Bill 70 of 1995. Published September 27, 1995. 9