Lapse in SLO law led to boom in secondary housing units, angering neighbors

Jeff Eidelman has lived in his San Luis Obispo home on Kentucky Street for 17 years, watching his neighborhood increasingly surround him with mostly student renters.

But he has reached his tipping point with the congestion, and he plans to move because of a six-month lapse in a city law in 2017 that temporarily allowed property owners to build secondary dwellings without having to live on the parcel themselves.

The neighbor's second home, he says, will rise over the fence, looking directly into his property, invading his privacy; he expects the tenants to be students, like in the existing house on the same property.

"Unfortunately, the bottom line is that many good people who have spent a majority of their lives here in SLO have and will suffer, due to this one specific problem," Eidelman said. "The City Council has not paid enough attention and respect to neighborhood wellness (quality of life). Our city grows faster than we can cope."

Seventy-seven applications were submitted to the city to construct accessory dwelling units (ADUs), also known as granny flats, from January to June 2017. The applications came after a new state law relaxed regulation on ADUs, including changes to parking and allowable size, and nullified local laws, pending new city ordinances.

The city has granted about 40 of those permit applications during the lapse already, and construction is underway.

The defaulting California law had no owner-occupancy requirement, as the city's previous policy and current ordinance both stipulate, which tends to deter real estate investors from building ADUs as purely rental properties, according to slow-growth advocates.

Critics say more ADUs will lead to traffic, noise and congestion, and ruin the city's quality of life.

"Property owners are going to build these ADUs in backyards and stock them full of more and more students," said Kathy Borland, who heads a group called Preserve the SLO Life. "The city's staff does not give a satisfactory answer as to why it took them so long to revise their ordinance. The bottom line is they want to promote ADUs as another source of affordable housing. But this won't help the problem until Cal Poly steps up and builds a lot more housing on campus."

Borland said some longtime residents in the Ferrini Heights neighborhood, north of Foothill Boulevard, are leaving the neighborhood, because landlords have filed ADU applications on several properties, likely to be filled by student renters.

Borland, a retired nurse and Buckley Road resident, said the city should have implemented an emergency order to stop the ADU applications until it passed its new ordinance, saying that was done in other cities in California, pending implementation of new local laws.

Her group's research shows that in the 10 months since the city's new ordinance was adopted on July 7, 2017, the city has received 24 applications for ADUs in comparison to the 77 submissions during the six-month window.

Community Development Director Michael Codron said the temporary lapse occurred as the city worked its way through internal city staff and public processes on how best to proceed, including public hearings.

Codron said the city didn't alert developers to the lapse in the law, as some residents have rumored. The city also held a meeting in early 2017 to discuss ADUs, without receiving concerns from members of the public.

He said the city also was learning about the laws and, in hindsight, might have asked the City Council to weigh in on permitting regulations during the gap period, but city officials were still gaining information about policy options.

But Codron noted that state legislation could soon override the city's efforts anyway, citing Senate Bill 831, which has a condition removing cities' ability to require owner occupancy.

"These issues continue to be a challenge to balance neighborhood wellness with the city’s goals for housing production," Codron said. "Very little growth happened in the city of SLO between 1990 until more recently, and not a lot of housing was built statewide for that matter. There are a lot of communities where state legislation that is intended to thwart local ability to control growth is having a real impact on people’s perceptions of neighborhood quality and quality of life."

Codron said the city will have to work "closely with the community in the future to figure out how to address those issues."

City Manager Derek Johnson said at an April 10 City Council meeting that 130 housing bills were introduced in California in 2017, many of which were enacted, as the state pushes cities to build more housing, citing 180,000 fewer units available than needed across California.

Johnson said the city's timing on a new ordinance was faster than usual with land-use policy.

"I know people are disappointed with the pace," Johnson said. "... I want the City Council to know and the community that we are watching these bills and we reacted very quickly — six months to bring forward an ordinance amendment for a housing law. That's pretty quick in the city of San Luis Obispo."

Codron said the city is working closely with Cal Poly to tie enrollment growth to campus housing, meaning the university should not grow its campus to a level that outpaces its ability to provide residences for students.

Cal Poly projects that it will house 65 percent of all of its students on campus within the next 20 years, capping enrollment at 25,000. Cal Poly reported 22,188 students enrolled this fall.

About 38 percent of Cal Poly students live on campus (all freshmen and 60 percent of sophomores). A new dorm housing 1,475 freshmen will open in the fall.

"Cal Poly strongly believes that housing more students on campus is good for the students themselves as well as for the city and its neighborhoods," said Matt Lazier, Cal Poly's spokesman said in April.

This story was originally published May 7, 2018 at 6:09 PM with the headline "Lapse in SLO law led to boom in secondary housing units, angering neighbors."