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Home My WebLink About08. Conduct an appeal hearing of a staff decision re Capacity Feeds due for an ADU on a property in Martinez Page 1 of 4 Item 8. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: NOVEMBER 3, 2022 SUBJECT: CONDUCTA HEARING TO CONSIDER MS. JODI LEWIS AND MS. MISHA SAFRAN'S APPEAL OF A STAFF DECISION THATA CAPACITY FEE IS OWED FOR AN ACCESSORY DWELLING UNIT (ADU)AT 1241 GREGORY STREET IN MARTINEZ SUBMITTED BY: INITIATING DEPARTMENT: THOMAS BRIGHTBILL, SENIOR ENGINEER ENGINEERING AND TECHNICAL SERVICES- PDS-RATES AND FEES REVIEWED BY: DANEA GEMMELL, PLANNING AND DEVELOPMENT SERVICES DIVISION MANAGER Roger S. Bailey Kenton L. Alm General Manager District Counsel ISSUE Ms. Jodi Lewis and Ms. Misha Safran submitted a Central San application for the legalization of an Accessory Dwelling Unit (AD U) constructed by a previous property owner on their parcel at address stated above. Central San staff determined that under the current District Code and Capacity Fee schedule, sewer Capacity Fees of $8,713.72 are owed. District Code section 1.16.010 allows that any person may appeal a final staff decision to the Board of Directors (Board). BACKGROUND On August 16, 2022, Ms. Jodi Lewis and Ms. Misha Safran submitted an application for sewer service for an existing AD on their parcel at 1241 Gregory Avenue in Martinez. Ms. Lewis and Ms. Safran explained that only after completing the purchase of the property did they find out that no permits had been obtained November 3, 2022 Regular Board Meeting Agenda Packet- Page 51 of 245 Page 2 of 4 from the City of Martinez for the construction of the ADU. Central San staff confirmed that no permits appear to have been issued by Central San for the ADU. Central San Capacity Fees for ADUs On October 8, 2017, Senate Bill 229 (SB 229)was signed into law. SB 229 extended certain reductions in Capacity Fees forADUs to special districts such as Central San. In response to SB 229, Central San held a public hearing on November 16, 2017 to amend the District Code and revise the Capacity Fee schedule effective January 1, 2018. The revised District Code included section 6.12.030 (E), Capacity Fees for Unpermitted Work, which states: 1. Capacity Fees for all other uses for which the District did not receive a request for a connection permit or building plans for review shall be charged at the rate that is current at the time of discovery. 2. Capacity Fees for an Accessory Dwelling Unit constructed prior to January 1, 2018 for which the District did not issue a permit shall be charged as a multi-family residential unit. Several factors resulted in the specific language used in section 6.12.030 (E)(2) including: • the new State Law did not address work done prior to the effective date; • the new State Law included provisions that • projects which involved conversion of an existing space into an ADU were generally exempt from paying sewer Capacity Fees, and • projects for new construction of an ADU would be subject to payment of a significantly reduced sewer Capacity Fee; and • Central San staff believed that property owners who failed to obtain permits for their projects should not benefit from new fee reductions when other property owners who obtained permits for projects prior to the ADU legislation paid sewer Capacity Fees without any discounts. The Current Appeal Staff has had several discussions with Ms. Lewis and Ms. Safran about the project and the associated fees. Ms. Lewis and Ms. Safran have repeatedly expressed their desire to get the ADU properly permitted with both the City of Martinez and with Central San. They indicated that they anticipate using the ADU as a rental unit and have held off on renting the unit until all the permitting and fee issues have been resolved. Ms. Lewis and Ms. Safran have also indicated that the full Capacity Fee of$8,713.72 would be a difficult burden for them in light of the recent expenses associated with purchasing the property and some additional unanticipated repairs which have been discovered since the property was purchased. During discussions with staff, Ms. Lewis and Ms. Safran have indicated that payment of sewer Capacity Fees at the current ADU rates shown on Central San's current Capacity Fee schedule would be reasonable to them and have asked for that accommodation. If the current capacity fees for new construction of an 481 square foot ADU were applied to their project, the Capacity Fee would be $2,791.04. Effect of the Current Appeal on District Code, if Granted If the Board is amenable to granting relief to Ms. Lewis and Ms. Safran, it may wish to revise District Code to allow sewer Capacity Fees for unpermitted ADUs constructed by a prior property owner to be charged at the discounted rate for new ADU construction. Staff would need to develop specific language and bring November 3, 2022 Regular Board Meeting Agenda Packet- Page 52 of 245 Page 3 of 4 that language to a Board Committee for review prior to scheduling a public hearing with the full Board as a separate matter. The Board of Directors may also wish to consider adding a nominal penalty which could be charged in addition to the reduced Capacity Fee. ALTERNATIVES/CONSIDERATIONS The Board of Directors could: 1. Grant Ms. Lewis and Ms. Safran's appeal; or (Staff Recommends) 2. Deny Ms. Lewis and Ms. Safran's appeal; or 3. Provide some other direction to staff regarding the appeal. I n addition, the Board of Directors may wish to consider providing direction to staff about a future change to District Code regarding Capacity Fees for unpermitted ADUs created by previous property owners. FINANCIAL IMPACTS If the appeal is approved by the Board and the Capacity Fee is reduced to $2,791.04, then $5,922.68 in Capacity Fees would not be collected. COMMITTEE RECOMMENDATION District Code Section1.16.030 states that appeals of staff decisions are to be heard "at a regular meeting of the Board of Directors." Therefore, this matter was not reviewed by a Board Committee. RECOMMENDED BOARD ACTION Conduct the appeal hearing and provide direction to staff by selecting one of the alternatives summarized above. Strategic Plan re-In GOAL TWO: Environmental Stewardship Strategy 1 -Achieve compliance in all regulations ATTACHMENTS: 1. Request for Appeal of Capacity Fees November 3, 2022 Regular Board Meeting Agenda Packet- Page 53 of 245 Page 4 of 4 Thomas Brightbill From: Misha &Jodi xoxo <wegiggle2gether@gmail.com> Sent: 10 10, 2022 05:18 PM To: Danea Gemmell Cc: Katie Young; Thomas Brightbill Subject: Re: Unpermitted ADU at 1241 Gregory Ave, Martinez Hello Danea, We hope that you had a wonderful weekend. We are writing to you as suggested by Thomas Brightbill to appeal the high fees being asked of us. We are not suggesting we not pay any fees but ask that they be significantly reduced based on the below circumstances. We are the new homeowners of 1241 Gregory Avenue. Part of the reason we purchased the house was because it was listed as having a lower studio which could be rented. This was important to us to help sustain homeownership and make necessary ongoing repairs on the property. Because of our ethics and wanting to ensure that the property is safe, we decided to seek a permit for the studio.This was despite many people's suggestions that we just rent the space without having permits for it. We were led to believe that we may expect to have to pay around one thousand dollars. We,thus, started the process of obtaining a permit for the ADU. Given that Jodi works for a non-profit agency and Misha is disabled and self-employed we were quite distressed when we received the email from Central San asking us to pay$8,713.72 in order to legalize the existing ADU on our property. We, therefore, replied to Central San and asked Rigo to explain the fees. Rigo then put us in touch with Thomas.Thomas and Misha met via zoom to discuss as Thomas outlined in his email. We still don't understand why we are being asked to pay such a high fee given that we were not the ones to build the unit, nor were we the ones to live here for years without permitting it. It feels punishing to us as new homeowners when we are trying to do the right thing for ourselves, potential tenants, and the community. As it is we have unexpected repairs, including a new furnace because the prior owners inappropriately by-passed the emergency shut off valve. Misha has fibromyalgia and cannot live without heat so this is another expense that we have. We recognize that this added expenditure is not Central Sans issue or fault. We, however, hope that you will consider the fact that the unit not previously having permits is also not our fault. We are trying to do the right thing by permitting the rental unit. Though we appreciate the offer of a payment plan,this is still a huge expense for us even if it is paid overtime and not one that we feel is equitable because the studio was pre-existing. We hope that we can work with you to determine a reasonable fee in order for us to obtain a permit for the apartment. Thank you in advance for your consideration, Misha &Jodi On Mon, Oct 10, 2022 at 3:34 PM Thomas Brightbill <tbrightbill@centralsan.org>wrote: I November 3, 2022 Regular Board Meeting Agenda Packet- Page 54 of 245