City of Morgan Hill Fiscal Years 2020- 2022 Recommended Operating and CIP Budgets

Development Services

Introduction to Department The operations of the Development Services Department include activities of the City related to the built environment: Building, Building Inspection, Current and Long-range Planning, Code Compliance, Economic Development and Affordable Housing/Homelessness, as well as related Administrative Support Services. Development Services provides collaborative leadership on City Council Strategic Priorities of Economic Development, Transportation, and Housing and Homelessness, as well as the Ongoing Priorities; Enhancing Public Safety, Protecting the Environment; and Supporting our Youth, Seniors and Entire Community and Advancing Regional Initiatives. Development Services also provides the comprehensive long-range planning required to accommodate specific transportation enhancements, economic development attraction and retention to increase jobs and expand the City's tax base, tourism as well as affordable housing preservation and development, and homelessness services and prevention. The 2018-19 and 2019-20 fiscal years witnessed a continued high demand for land development planning, building, and engineering activity as the strong housing development-oriented local economy continued. The residential development market remains vigorous, but the commercial/ industrial market accounted for just over 20 percent of building permit activity. For Morgan Hill, the health in the economy led to the completion of development of many residential projects that had been awarded allocations through the Residential Development Control System (RDCS), however, new legislation (SB 330) adopted in September of 2019, effective January 1, 2020, placed a 5 year sunset (January 1, 2025) on the City’s ability to regulate the pace and number of housing permits via Measure S that could be constructed each year. This legislation also required that the City create objective design standards for new housing development as well as expedite the Design Permit review process timeline to comport with the rigorous expectations of the law. In the FY 2018-19 and FY 2019-20 timeframes, the surge of activity was mitigated in some cases by contract and part-time services facilitating more than 9,777 building inspections in FY 2018-19 and 9,841 building inspections for the first three quarters of FY 2019-20. Contract and part-time planning services were used to assist private development activities as well as to supplement staff as energies were directed towards preparation for SB 330 changes on January 1, 2020 and community education about those changes. One staffing change occurred in FY 2019-20; a Building Plan Check Engineer position was added to the Building Division. To date, Morgan Hill has not been successful recruiting for this open position. As a result, contract services and staff dedication to plan check vs. inspection remains a challenge. As the City gears up for implementation of SB 330, the 2019 Housing Crisis Act, it is clear that we will need to augment the Building Team with full time plan check services, and by doing so, allow our skilled team to deploy with greater flexibility to building/fire inspection, specifically allowing the Building Official and Supervising Building inspector less time with plan check functions and more time in the field assisting with the more complex, combined inspections required of our commercial/industrial development.

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