Vacaville study session weighs modest inclusionary requirement, in-lieu fees and performance metrics

Vacaville staff and consultants on Tuesday presented findings from a phase‑one feasibility study on an inclusionary housing ordinance, outlining options for a modest requirement, potential in‑lieu fee structures and program safeguards. The Planning Commission provided detailed feedback and asked staff to return to City Council on Feb. 25 with the study session record and recommendations for next steps.

Joshua Abrams of Community Planning Collaborative summarized the consultant team’s analysis of residential and commercial feasibility, outreach and recommended next steps. Abrams said the firm modeled typical development “prototypes” to test whether a local inclusionary requirement would make projects infeasible. He told the commission that the market analysis suggests Vacaville can likely support a modest requirement and that strong options and alternatives for developers tend to make adoption more workable.

The study session highlighted three broad compliance paths: (1) on‑site affordable units, (2) off‑site or clustered affordable units near the project, and (3) in‑lieu fees to pool money for larger affordable projects. The consultant recommended starting conservatively — the presentation suggested a 10% set‑aside as an example — and re‑assessing after roughly three years. For rental units the study modeled affordability targets near 60% of area median income (AMI); for ownership units the suggested affordability level was higher, consistent with common practice.

Abrams said the consultant modeled five residential product types (single‑family for sale, single‑family rentals with ADUs, townhomes, multifamily rental and cottage court) and concluded that most product types remain feasible under a modest requirement, though multifamily rental was described as the tightest margin in the current market assumptions. The team also modeled a potential commercial linkage fee at a modest level (the report referenced roughly $0–$5 per square foot as an initial range for consideration) but noted commercial development in Vacaville is uneven now and that a blanket commercial fee could affect competitiveness.

Public comment included remarks from Todd Chambers of Lewis Group of Companies, who said large master‑planned projects make it easier to provide affordable units and cautioned that requiring developers to provide units or pay fees shifts costs into market‑rate housing. Chambers said his firm would propose land for affordable housing in an East of Leisure Town project and noted several approved but unfunded affordable projects in Vacaville.

Commissioners probed several issues: how other cities measure program performance, what success indicators to use, whether deed‑restricted ownership effectively serves low‑ and moderate‑income households over time, whether in‑lieu fees accumulate fast enough to fund sizable projects, how to avoid geographic concentration of affordable units, and how state law and pipeline projects interact with an adopted local ordinance. Staff and consultants noted examples of comparable cities (including American Canyon, Davis, Napa City and others), emphasized the need for options (in‑lieu, clustering, off‑site) to increase feasibility, and said the ordinance would apply prospectively to new entitlements (i.e., not to projects already vested).

Staff flagged two local affordable projects with funding gaps — Allison Apartments (about 135 units) and Oak Grove Apartments (about 60 units) — that could be candidates for pooled in‑lieu funds, but warned in‑lieu fee funds often accumulate slowly. Commissioners asked staff to provide more case studies that show measurable performance metrics (units produced, time-to-occupancy, measures of displacement, and long‑term affordability outcomes) and to return with scenarios that estimate the ordinance’s likely output against the city’s housing needs and pipeline projects.

Next steps: staff will summarize the Planning Commission’s feedback and present the study session record to City Council on Feb. 25. If Council directs staff to continue, the consultant would prepare a draft ordinance (phase 2) with in‑lieu fee analysis, detailed options, and targeted outreach.