SAN RAFAEL CITY COUNCIL AGENDA REPORT

Transcription

1 Agenda Item No: 6.b Meeting Date: July 17, 2017 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: COMMUNITY DEVELOPMENT Prepared by: Paul Jensen, Director Thomas Ahrens, Chief Building Official City Manager Approval: TOPIC: SUBJECT: Residential Building Resale Report (RBR) Program Residential Building Resale (RBR) Program Six-Month Progress Report. RECOMMENDATION: Accept report. BACKGROUND: History: In 1973, the City Council adopted Ordinance 1128, which established the City s Residential Building Resale (RBR) Program. The provisions and requirements of the RBR Program are codified in San Rafael Municipal Code (SRMC) Chapter (Report of Residential Building Record). SRMC Section requires that prior to the sale or exchange of any residential building, the property owner is required to obtain a report of residential building record (resale report). The program includes a City inspection for which the findings are incorporated in the resale report. While the RBR Program is not a common service and practice in most California cities, this program is in place in all local jurisdictions in Marin County, except for the County of Marin. In 2016, the California State Auditor s Office completed a performance audit on the residential resale programs for San Rafael and two other California cities (Pasadena and Novato). The performance audit report focused on five topic areas for evaluation: a) the qualifications of City staff (inspectors) completing the inspections for the resale reports; b) an analysis of fees charged for the resale reports (audit found that the City is likely undercharging for inspections of single-family and condominium dwellings. ); c) an assessment of the consistency in reports issued to the same property over time; d) the timeliness of the inspections and reports; and e) the value of the resale report to all parties involved in the property sale. In response to the State performance audit, in mid-2016, the City Council directed the Community Development Department to study RBR Program options including the continuation, modification, or elimination of the program. Following two study sessions, the City Council determined that the RBR FOR CITY CLERK ONLY File No.: Council Meeting: Disposition:

2 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2 Program should be retained but that substantial improvements were warranted. Staff was directed to return to the City Council with a revised ordinance that incorporates a list of updated policies and practices including, among others, a defined resale inspection checklist, an appeal process, and a list of unpermitted improvements work encountered during the RBR inspection that could be grandfathered. Updated RBR Program On December 5, 2016, the City Council held a public hearing to review revisions to SRMC Chapter and a substantially-revised RBR Program. Following public testimony, on a unanimous vote, the Council adopted Ordinance 1945 setting forth new municipal code provisions for the RBR Program. In tandem with this action, the Council adopted: a) Resolution 14243, which sets forth adopted policies, practices and procedures for administering and enforcing the RBR Program; and b) Resolution 14244, which updates the RBR Program fee schedule. Ordinance 1945 and Resolution are attached. The December 5, 2016 City Council staff report and video stream of the public hearing can be accessed at the following links: The following is a list of key changes to the RBR Program that were adopted as part of the City Council action: To reduce inconsistencies in City inspections, a regular or fixed-term employee should be assigned to conduct the RBR inspections rather than use of temporary/seasonal employees. A Resale Inspection Checklist should be developed to: a) ensure consistent City inspection practices; and b) provide the customer (owner and buyer) with an understanding on what the City inspector will or will not be looking for during the inspection. The list of unpermitted work encountered during the RBR inspection that would be grandfathered (exempt from obtaining a retroactive permit) should be broadened and expanded. The period of time a property owner is given to correct or remedy a violation should be extended to 180 days and upwards of 365 days for the property owner that inherited the violation from a previous owner. An appeal process should be established for the property owner who wishes to dispute the findings of the resale report. A refund of the RBR fee should be offered the property owner that has been issued a clean resale report with no cited violations or corrections. An amnesty program needs to be periodically implemented to offer a property owner the opportunity to correct or remedy a violation without paying penalties or fines. An educational component is critical and should be implemented. Tools/measures such as informational handouts and a video posted on the City website should be developed, along with the hosting of a Coffee & Codes.

3 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3 Further, the City Council directed that six months following adoption of the updated RBR Program, staff shall prepare a progress report on the implementation of the program, and present the report to the City Council for review. Six-Month Review The updated RBR Program commenced on January 17, Per City Council direction, staff is presenting a six-month progress report on the updated program. City Council Resolution (Attachment 2) includes a list of measures that City staff committed to implement. The following is a summary of the program progress: 1. Dedicated RBR Inspector. The Building Division has assigned one, full-time department employee (DJ Heckler, Code Enforcement Officer III) to serve as the RBR Inspector. At present, Mr. Heckler devotes about 50% of his worktime to the program. He conducts all of the requested RBR inspections except during peak times when a back-up inspector provides assistance. Mr. Heckler has worked for the City of San Rafael for over 10 years and has a reputation for providing good customer service. Management staff has received compliments about Mr. Heckler s efficient and consistent inspection practices, as well as his pleasant demeanor. The devotion of a single inspector to conduct the resale inspections coupled with use of the Resale Inspection Checklist (Attachment 3) has significantly increased inspection and report consistency. 2. Quality Control. All draft resale reports are reviewed by the department management staff (either the Community Development Director or Chief Building Official) before they are finalized and posted. This review has provided a high level of quality control as it affords an opportunity to: a) compare the report findings with the permit record and past resale reports; and b) correct any inconsistencies. This quality control review will continue. 3. RBR Activity. Since commencement of the updated program in January 2017 the Building Division has processed and issued 315 resale reports, which is about reports per month (January 17 through June 30, 2017). An additional 31 applications are pending. The following table provides a breakdown on the number of clean reports that were issued, along with reports issued with minor violations (resale report Section B violations requiring minor or routine permits) and more major violations (resale report Section C violations requiring abatement or correction with a major building permit): Resale Report Activity Total Total number of clean resale reports issued: 150 Total number of resale reports issued with minor violations (Report Section B): 85 Total number of resale reports issued with major violations (Report Section C): 80 TOTAL NUMBER OF REPORTS ISSUED: 315 For this period, a total of 90 Code Enforcement cases were opened for the reports with major violations (along with several reports with minor violations) to initiate follow-up correction to cited violations. To date, 30% of those cases have been resolved. 4. Notice of Compliance. As adopted, the updated RBR Program includes the issuance a Notice of Compliance to properties that have been issued a clean resale report or when cited violations have been corrected. Since the commencement of the updated RBR Program, the Building Division has issued a Notice of Compliance for 151 properties. Please note that the Notice of Compliance is the very last step before the file is closed. So, there is a lag time between the issuance of a resale report and the issuance of this notice.

4 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 4 5. Appeals & Complaints. Since commencement of the updated RBR Program, the Community Development Director has received one appeal, which was denied. Staff has received very few complaints. 6. Fees and Refunds. To date, nine RBR fee refunds have been issued for properties that were issued clean resale reports for a total amount of $2,435. A summary of the fees collected during this period is provided in the Fiscal Impact section of this report. 7. Education & Outreach. As recommended, a number of education and outreach measures have been implemented. First, a Coffee & Codes was hosted by the Building Division on April 5, The Coffee & Codes event provided property owners and real estate professionals a summary of the updated RBR Program including available resources, the Resale Inspection Checklist, and the suggested steps to take to prepare for a resale inspection and report (see Attachment 3). The event was attended by property owners and real estate professionals. Second, informational handouts and the RBR report template, and the Frequently-Asked Questions have been updated. These documents have been posted on an updated RBR Program webpage, which can be accessed at the following link: There are several additional procedural measures listed in Resolution 14243, which have yet to be implemented. An informational video has not yet been developed, but is part of the Building Division work program for this year. Also, the Building Division will launch the first bi-annual amnesty program structured to encourage property owners to file for retroactive permits for un-permitted improvements. The first bi-annual amnesty program is scheduled for late fall 2017/early winter 2018, which is the slow season for building permit activity. ANALYSIS Overall, staff finds that the updated RBR Program is progressing successfully and consistent with the City Council direction. As the City is seven months into the updated program, staff would like to offer the following observations: 1. The use of a single RBR Inspector has been well-received and staff has received positive feedback on our assigned inspector. 2. It is apparent that property owners (property owners) are being more proactive at the front end of the property sale process. Real estate professionals are urging sellers to resolve unpermitted improvements and violations, and sellers are requesting City permits (mostly retroactive building permits) before filing a request for a resale report. By doing so, sellers are seeking to avoid or minimize fines/penalties or delays in property sales with the goal of obtaining a Notice of Compliance. So, the program messaging that has been encouraged by City staff appears to be effective. 3. As noted above, City staff has received few complaints about the updated program. For now, no changes are recommended but staff will continue to monitor the program. COMMUNITY OUTREACH: As this is a status report on the progress of the RBR Program, no formal notification was published or implemented, However, staff contacted the Marin Association of Realtors (MAR) to inform the Association of the six-month report and this City Council review.

5 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 5 FISCAL IMPACT: The administration of the RBR Program is financially sustained by fees. As noted above, the City Council in December 5, 2016 included an update of the RBR Program fee schedule. The adopted RBR fees are presented in the following table: RBR Service Report Fee Resale Report- Single-Family Residential Resale Report- Multiple-Family/Apartments First Unit. Each additional Multiple-Family Dwelling/Apt. Unit $290 $270 $30 Resale Report- Condominiums $255 Appeal $100 Year-to-date, the City has collected $97,645 in program fees. Regarding the 100% refund that is issued for clean reports, to date, of the 150 clean resale reports issued (48% of the total), the City has issued nine refunds for a total amount of $2,435. The applicant of the resale report (typically either the seller or the listing agent) must request a refund as refunds are not automatically processed and issued. Further, refunds are not granted until the Notice of Compliance has been issued. As reported to the City Council in December 2016, approximately 50% of the resale reports issued annually are clean reports. With an annual average of resale reports issued annually, application fee refunds could be upwards of $95,000-$100,000. So far, this fiscal impact has not been realized. However, as the program continues, knowledge of the refund policy may increase. Staff will continue to monitor the refund activity and periodically report back to the City Council. OPTIONS: The City Council has the following options to consider regarding this matter: 1. Accept the report; or 2. Accept the report but direct staff to return with additional information; or 3. Direct staff to return with additional information; or 4. Reject the report. RECOMMENDED ACTION: Accept Report. ATTACHMENTS: 1. Ordinance Resolution RBR Program Policies, Practices and Procedures with Exhibit A- Resale Inspection Checklist 3. Informational Handouts - Resale Inspection Checklist & What to Inspect from Your Resale Inspection

6 ATIACHMENTI ORDINANCE SRMC CHAPTER (RBR PROGRAM)

7 ORDINANCE NO AN ORDINANCE OF THE CITY OF SAN RAFAEL AMENDING SAN RAFAEL MUNICIPAL CODE TITLE 12 (BUILDING REGULATIONS) TO REPEAL CHAPTER THEREOF IN ITS ENTIRETY AND REPLACE IT WITH NEW CHAPTER (REPORT OF RESIDENTIAL BUILDING RECORD) WHEREAS, in 1973, the San Rafael City Council adopted Ordinance 1128 adding Chapter (Report of Residential Building Record) to Title 12 (Building Regulations) of the San Rafael Municipal Code ("SRMC"), establishing a program (referred to as the "RBR Program") requiring that, upon the resale of any residential property within the City, the seller shall obtain from the City a report of the City permit records and City inspection of the property. The report provides an added level of disclosure to the purchaser of the property; and WHEREAS, throughout the subsequent years following adoption, the City has administered the RBR Program employing various levels of inspection and reporting; and WHEREAS, in March 2016, the California State Auditor's Office completed and published a performance audit report on the City's RBR Program, which report also assessed similar residential resale programs in the City of Pasadena and the City of Novato. The performance audit report recommended that the City of San Rafael amend the RBR Program to incorporate additional processes and procedures to improve and formalize program administration, inspection and reporting; and WHEREAS, on April 4, 2016, the performance audit report was presented to the City Council. In respond to a review of the performance audit report findings and public comment, the City Council directed staff to study options to the RBR Program including the continuation, modification, or elimination of the program; and WHEREAS, the Community Development Department prepared five RBR Program options, which were presented to the City Council and public at two City Council Study Sessions held on August 1,2016 and September 6, 2016; an WHEREAS, based on comments received in the City Council Study Sessions, staff recommended that there is value to the community in retaining an RBR Program but recognized that there is need for change and improvement. Changes and improvements include the need to formalize policies and practices so as to reduce the potential for future inconsistencies in the RBR Program implementation and administration; and WHEREAS, on November 7, 2016, the City Council reviewed a report of the Community Development Department presenting the five program options and a staff recommendation to retain the RBR Program with significant improvements. As part of this review, the City Council considered the oral and written public testimony, ultimately accepting the agenda report. The City Council directed staff to proceed with preparing: a) amendments to SRMC Chapter to reflect the staff recommendation to retain the RBR Program with improvements; b) a resolution outlining the recommended policy, practices and procedures for improving the program; and c) an amendments to the RBR Program fees; and WHEREAS, the proposed amendments to Title 12 will repeal current Chapter in its entirety and replace it with a new Chapter 12.36; and WHEREAS, the proposed amendments to SRMC Chapter do not propose any changes to City policies or regulations that would result in a direct or indirect physical,

8 environmental impact; therefore it has been determined that this amending ordinance is exempt from environmental review under the California Environmental Quality Act (CEQA) pursuant to the general rule in CEQA Guidelines Section 15061(b)(3) that CEQA applies only to projects which have the potential for causing a significant effect on the environment; and WHEREAS, on December 5, 2016, the City Council held a duly noticed public hearing to consider this ordinance, and considered all oral and written public testimony and the written report of the Community Development Department; and WHEREAS, the City Council hereby makes the following finding that support the amendments to SRMC Chapter adopted herein: 1. The public interest is served by the proposed municipal code amendments as they would allow the continuation of the RBR Program with substantial improvements that are critical in maintaining an aging housing stock and providing an additional level of disclosure and protection to the residential property purchaser. In addition, there is general value to the RBR Program which is in the public interest in that the program: a) has been administered for over 40 years and is a program that is common to all local jurisdictions in Marin (except the County of Mann); b) offers a unique service to the purchaser that is not provided by the real estate professionals or the privately-commissioned home inspectors; c) provides City access to the community's housing stock, which assists in identifying unpermitted work and pursuing code compliance; and d) is supported by the California State Auditor's Office performance audit report as a means of providing "consumer protection to home purchasers and to enhance the enforcement of zoning and health and safety regulations before the property ownership is transferred." 2. The municipal code amendments would be consistent with the San Rafael General Plan 2020, specifically Housing Element Policy H-8 (Housing Conditions and Maintenance) and Neighborhood Element NH-4 (Improve Property Maintenance) in that the RBR Program, as amended, would: a) would assist in protecting the housing stock by enforcing the housing and building codes; b) require property owners to maintain their properties in good condition to eliminate unsafe and unhealthy conditions. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN RAFAEL DOES HEREBY ORDAIN AS FOLLOWS: DIVISION 1. AMENDMENTS. San Rafael Municipal Code Chapter (Report of Residential Building Record) is hereby repealed in its entirety, and replaced with a new Chapter 12.36, to read in its entirety as follows: Chapter REPORT OF RESIDENTIAL BUILDING RECORD Sections: Purpose. The city finds that it is necessary to maintain and upgrade the condition of the aging housing stock within the city to ensure the basic health and life safety of its residents. A report of residential building record, prepared and issued upon the resale of residential property provides a reasonable and effective method of disclosing building conditions, unpermitted improvements, and mandatory items of correction to meet the city codes governing basic health and life safety. 2

9 In addition, the city finds that a report of residential building record provides a valuable disclosure of building conditions to the purchaser, and an opportunity for the city to enforce building and zoning codes Definitions. (a) "Building official" means the chief building official, an authorized deputy, designated building inspector or other designated employee of the community development department building division charged with enforcement and administration of this chapter. (b) "Owner" means any person, co-partnership, association, corporation or fiduciary, or their authorized agent(s) having legal or equitable title or any interest in any real property. (c) "Purchaser" means any person, partnership, association, corporation or fiduciary, or their authorized agent(s) acquiring legal or equitable title or any interest in any real property. (d) "Report" means the report of residential building record. (e) "Residential building" means any improved property designed or permitted to be used for dwelling purposes (e.g., single-family dwelling, two-family [duplex] dwelling or multiple-family dwelling [apartment], or townhome), situated in the city and shall include all the buildings or structures located on the improved real property Report required. Prior to the sale or exchange of any residential building, the owner thereof shall obtain from the city a report of residential building record, which documents the findings of a city permit records search and city inspection Application for report. An owner required by this chapter to obtain a report shall file an application to the community development department, building division, on forms provided by the department containing stich information that may be deemed necessary ,050 - Fees. A report shall be subject to an application fee made payable upon application to the city by the owner. The filing fee for the report shall be as set forth in the city's master fee schedule Contents of report. Upon application of the owner and payment of the fee, the building division shall review pertinent city records and inspect the premises in question. Upon completion of the review and the inspection, the building division shall make available to the owner a written report of residential building record, which shall contain in respect to the residential building and property the following information: (a) The street address and assessor's parcel number of subject property; (b) A statement documenting the zoning district classification for the property and a list of the zoning permits and/or approvals that have been granted to the property; (c) A list of the record of construction permits that are on file with the building division and, if any, the active or expired building permits that have been issued for work not yet completed on those premises; (d) A list of past code enforcement cases and actions taken by the city; (e) A statement confirming the type and number of residential buildings and dwelling units observed at the time of the city inspection; 3

10 (f) A statement as to whether there are any nonconformities or illegalities in the structures on the property or the uses such as, but not limited to, undocumented dwelling units or unpermitted improvements observed at the time of the city inspection; (g) A statement listing any violation~ observed at the time of the city inspection and the required remedy for such violations (e.g., obtaining retroactive permits or abatement); (h) A statement of advisory notation~ from the city on improvements observed at the time of the city in~pection; (i) The name of the city building inspector that conducted the city inspection supporting the report finding~, along with the name and contact information of the building division employee that is available to assist in addressing questions and issues; 0) The dates of report issuance and expiration; and (k) A return receipt and buyer's certification form. (I) A notification of the appeal process available to the owner who wishes to contest the contents of the report Policies, practices and procedures for administering the report program. The report program shall be administered and enforced by the community development department consistent with city policies, practices and procedures adopted by resolution of the city council. The adopted policies, practices and procedures shall address and incorporate, among others, the following: (a) Time frames and procedures for report processing and remedies; (b) The specifics on the scope of the city in,pection for owner and purchaser awareness and to minimize redundancy with the privately-commissioned inspection reports prepared as part of the resale transaction; (c) A list of unpermitted improvements disclosed during the city inspection that are waived from obtaining a retroactive permit(s); (d) Policies for fees for the report application, appeals, refunds and waivers; and (e) Measures to facilitate customer awareness and knowledge of the report program Delivery and receipt of report to purchaser. When completed, the report shall be made available to the seller (owner) or their authorized agent(s) who shall acknowledge receipt of the same. The owner or their authorized agent(s) shall deliver the report to the purchaser or transferee prior to the consummation of the sale. The purchaser or transferee shall execute an acknowledgment of receipt of the report and deliver a copy of said receipt to the community development department building division Appeals. The report results and/or findings may be appealed to the community development director by the owner or his or her authorized representative. All appeals must be filed in writing with the community development department within five (5) working days of the date of issuance of the report and accompanied by an appeal fee as set forth and adopted in the city's master fee schedule. The community development director shall review and render a written determination on the appeal within 10 working days of the filing date of the appeal Expiration and extension. The report of residential building record shall be valid for a period of six (6) months from the date of issuance by the city. Prior to the expiration date of the report, the owner may request and the city may is~ue one extension of up to three (3) additional months. There shall 4

11 be no fee for the issuance of the extension. In the event the property is not sold and is remarketed after the report has expired, a new report shall be requested and issued by the City Exceptions. The provisions of this chapter shall not apply to: (a) The first sale of any residential building if such sale is within a twelvemonth period from the recordation of the notice of completion of the residential building; (b) A re-conveyance by a trustee pursuant to the provisions of a deed of trust; (c) A transfer of property made without valuable consideration (e.g., transfer by reason of death or transfer into or out of a revocable trust); (d) A transfer of property made solely between co-owners; and (e) The transfer of a mobile home or trailer occupying land pursuant to a month - to-month rental or annual lease agreement, which does not involve the transfer or can veyance of real property Compliance with law. No statements contained in a report of a residential building record issued by the city shall authorize the use or occupancy of any residential building contrary to the provisions of any law or ordinance. Every report issued under this chapter shall contain a provision stating that the issuance of such report shall not constitute a representation by the city that the property or its present use is or is not in compliance with the law, and that the report does not constitute a full disclosure of all material facts affecting the property or the desirability of its sale Failure to obtain a report. Except as provided in this chapter, it is un lawful for the owner of a residential building in the city to sell or exchange the same without first having obtained a report pursuant to this chapter and delivering it to the purchaser. Any person violating any of the provisions of this chapter is guilty of an infraction and upon conviction thereof shall be punished by a fine not exceeding five hundred dollars ($500.00). DIVISION 2. SEVERABILITY. If any subsection. sentence clause or phrase of this ordinance amendment is, for any reason, held to be invalid, such decision shall not affect the validity of the remaining portions of this added ordinance section. DIVISION 3. PUBLICATION; EFFECTIVE DATE. A summary of this Ordinance shall be published and a certified copy of the full text of this Ordinance shall be posted in the office of the City Clerk at least five (5) days prior to the Council meeting at which it is adopted. This ordinance shall be in full force and effect thirty (30) days after its final passage, and the summary of this ordinance shall be published within fifteen (15) days after the adoption, together with the names of those Council members voting for or against same, in the Marin Independent Journal. a newspaper of general circulation published and circulated in the City of San Rafael. County of Marin, State of California. 5

12 Within fifteen (15) days after adoption, the City Clerk shall also post in the office of the City Clerk, a certified copy of the full text of this ordinance amendment along With the names of those Council members voting for or against the amendment. AITEST: ESTHER C. BEIRNE, City Clerk The foregoing Ordinance No was read and introduced at a regular meeting of the City Council of the City of San Rafael on December 5, 2016 and was ordered passed to print by the following vote, to wit: AYES: Councilmembers: Bushey, Colin, Gamblin, McCullough & Mayor Phillips NOES: Councilmembers: None ABSENT: Council members: None and will come up for adoption as an Ordinance of the City of San Rafael at a Regular Meeting of the Council to be held on the 19th day of December ESTHER C. BEIRNE, City Clerk Ord 1945_adopted (RBR) 6

13 ATIACHMENT2 RESOLUTION RBR PROGRAM POLICIES, PRACTICES AND PROCEDURES

14 RESOLUTION NO RESOLUTION OF THE SAN RAFAEL CITY COUNCIL ADOPTING POLICIES, PRACITCES AND PROCEDURES FOR ADMINISTERING AND ENFORCING THE RESIDENTIAL BUILDING RECORD PROGRAM ("RBR PROGRAM") SET FORTH IN SAN RAFAEL MUNICIPAL CODE TITLE 12 (BUILDING REGULATIONS), CHAPTER (REPORT OF RESIDENTIAL BUILDING RECORD) WHEREAS, in 1973, the San Rafael City Council adopted Ordinance 1128 adding Chapter (Report of Residential Building Record) to Title 12 (Building Regulations) of the San Rafael Municipal Code (SRMC) establishing a program (referred to as the "RBR Program") requiring that, upon the resale of any residential property within the City, the seller shall obtain from the City a report of the City permit records and City inspection of the property. The report provides an added level of disclosure to the purchaser of the property; and WHEREAS, throughout the subsequent years following adoption of Ordinance 1128, the City has administered the RBR Program employing various levels of inspection and reporting. Further, throughout the years, the laws regulating and the practices employed in residential property sales have changed significantly to protect the consumer (purchaser of property). Today, nearly all residential property resale transactions in Marin County include a privatelycommissioned Contractor's Inspection Report, which address basic health and life-safety; and WHEREAS, in March 2016, the California State Auditor's Office completed and published a performance audit report on the City'S RBR Program, which report also assessed similar residential resale programs in the City of Pasadena and the City of Novato. The performance audit report recommended that the City of San Rafael amend the RBR Program to incorporate additional processes and procedures to improve and fonnalize program administration, inspection and reporting; and WHEREAS, on November 7, 2016, the City Council reviewed a report of the Community Development Department presenting five program options and a staff recommendation to retain the RBR Program with significant improvements. As part of this review, the City Council considered the oral and written public testimony, ultimately accepting the agenda report. The City Council directed staff to proceed with preparing: a) amendments to SRMC Chapter to reflect the staff recommendation to retain the RBR Program with improvements; b) a resolution outlining the recommended policy, practices and procedures for improving the program; and c) an amendments to the RBR Program fees; and WHEREAS, on December 5,2016, the City Council introduced for adoption Ordinance No amending San Rafael Municipal Code Title 12 by adopting new Chapter (Report of Residential Building Record). It is anticipated that the City Council will adopt Ordinance No on December 19, The provisions of this ordinance require that the RBR Program be administered and enforced by the Community Development Department consistent with City policies, practices and procedures adopted by resolution of the City Council; and WHEREAS, on December 5,2016, the City Council held a duly noticed public hearing to consider the proposed RBR Program Policies, Practices and Procedures, and considered all oral and written public testimony and the written report of the Community Development Department; and WHEREAS, in considering the municipal code amendments set forth in Ordinance No. 1945, the City Council acknowledged and concurred with the Community Development

15 Department's recommendation to monitor the administration and enforcement of the RBR Program consistent with the RBR Program Policies, Practices and Procedures presented herein for a period of six months following adoption of the ordinance; NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby adopts the following RBR Program Policies, Practices and Procedures for administering and enforcing the RBR Program: A. SCOPE AND PURPOSE The scope and purpose of the RBR Program Policies, Practices and Procedures is to provide and ensure consistent administration, inspections and enforcement of the RBR Program, and to address basic health and life safety by: eliminating redundancy with privately-commissioned inspection reports; providing the City's property permit record; identifying unpermitted alteration andlor construction, or City code violations; and providing remedies. B. PROCESS The following processing steps shall be implemented by the Community Development Department, Building Division: I. A standard resale report template shall be maintained and updated when necessary and shall address/include the following: a. To eliminate redundancy or inconsistency with the privately-commissioned Contractor's Inspection Report that is typically prepared during the sales transaction, the resale report template will not include property inspection and compliance with basic health and life safety conditions that are covered or addressed in the privately-commissioned inspection report. Rather, the resale report will focus on determining that the property is in conformance with the City's permit record. b. To streamline the process and minimize inconsistent messaging, the name, position and contact information for a designated Building Division employee shall be provided on the report template. This one designated employee shall serve as the City "clearinghouse" and point of contact to the owner (seller) or their representative (e.g., their real estate agent, contractor or design professional) for all questions, inquiries or disputes regarding the resale report. 2. An application form for a resale report shall be made available at the Community Development Department and on the City website. An application shall be accompanied by the RBR application fee. An application can be filed by the owner (seller) or their representative such as their real estate agent. It is encouraged that the owner (seller) or their representative make an application for resale report early in the sales process or prior to the property listing. 3. Upon receipt of an application, the Community Development Department staff shall complete a research of the property permit records (Building and Planning Division permits) and code enforcement cases on file with the City. The results of the records search, along with other property information (e.g., property zoning, Assessor's Parcel Number) shall be entered into the City's RBR report form/template for use by 'the inspector. 2

16 4. Within seven (7) business days following the receipt date of the application, the Community Development Department staff shall contact the owner (seller) or their representative to schedule a date and time for City inspection. 5. During the property inspection, the City inspector shall: a. Take photographs of the property improvements for the City records. To protect the privacy of the property owner, the photographs shall be stored on a City server that is not accessible to the public. b. Focus the inspection on those items listed in RBR template form Sections A (Residential Dwelling Units [observed] at the Time of Inspection), B (Violations Requiring Routine Pennits, Inspection and Approval) and C (Violations Requiring Plans, Permits, Inspection and Approval). See "C" below and attached EXHIBIT A for the "Resale Inspection Checklist." c. Verbally report to/inform the owner (seller) or their representative of violations or unpennitted improvements observed during the inspection that do not appear to match with the property permit records. 6. Following the property inspection, the City inspector shall complete the resale report by entering the findings of the inspection. For quality control, an internal staff review of the report shall be completed to ensure that all infonnation and findings are complete and correct. 7. It is the City's goal to complete the resale report and make it available to the owner (seller) andlor their representative within three (3) working days of the City inspection. 8. If the owner (seller) or their representative should dispute the findings of the resale report, they can file an appeal with the Community Development Director. All appeals shall be filed in writing to the Community Development Department within five (5) business days of the date of issuance of the resale report, and shall be accompanied by an appeal fee. The Community Development Department shall review and render a written determination on the appeal within 10 business days of the filing date of the appeal. The written determination shall be in letter or memorandum form, which shall be posted in the resale report file. In the event the appeal action results a changes to the findings or information in the resale report, a revised resale report shall be issued. 9. An executed copy of the receipt acknowledging that the buyer has received and reviewed the resale report shall be returned to the Community Development Department, Building Division. The Building Division shall monitor the return of the executed receipts until this document is submitted to the City. C. INSPECTION POLICIES AND PRACTICES The following policies and practices shall be implemented by the Community Development Department, Building Division to ensure consistent City inspection practices, minimize redundancy with privately-commissioned inspection reports and to provide some relief to the owner in connection with unpennitted improvements: 1. For all resale inspections, the City inspector shall utilize the "Inspection Checklist" presented in attached EXHIBIT A. The Inspection Checklist identifies what the City inspector wilvwill not be reviewing during the City inspection. 3

17 2. Recognizing that the housing stock in San Rafael is aging and that past City inspection policies and practices have been inconsistent, the City has broadened/expanded the list of unpermitted improvements that are considered "grandfathered" and for which no retroactive permits will be required. This list includes: a. Kitchen and bathroom remodels 'over 25 year old b. Decks under 30" in height constructed prior to 2005; c. Replacement of kitchen countertops (over original cabinets); d. Bathroom vanities and shower enclosures with no other upgrades; and e. Expired permits for water heaters and furnaces provided that the RBR inspector determines that they were installed correctly and to-code. No retroactive permit will be required for the following, as a thorough City inspection cannot be performed without deconstruction, or the scope of work is unclear: f. Roof replacements and new exterior siding replacement; and g. Expired building permits where there was no final inspection and no plans to confirm work. The above unpermitted improvements will be documented and noted in the resale report. 3. To promote consistency in inspection practices, the City shall strive to use a regular or fixed-term employee to conduct the property inspections. D. REMEDIES FOR VIOLATIONS & UNPERMITTED IMPROVEMENTS To ensure that the report recipient is aware of and understands the available remedies for resolving violations and unpermitted improvements, the Community Development Department, Building Division shall implement the following: I. The resale report template shall include an informational statement or handout describing the follow-up steps, requirements (what to expect such as a formal City Notice & Order to abate or correct the violation), remedies and timelines for addressing violations and unpermitted improvements. This informational statementlhandout shall also offer that if the owner (seller or buyer) intends on remodeling or pursuing home improvements that would replace the unpermitted improvements, the owner can inform the City in-writing of their intent to do so, which may negate the requirement for corrections or retroactive permits. 2. A standard notice detailing the violation(s) and recommended remedies shall be mailed to the owner within 10 calendar days following availability and delivery of the resale report to the owner. 3. For unpermitted improvements that have been identified, not less than 180 days will be provided to the owner (seller or buyer) to correct, permit or abate before code enforcement actions are initiated by the City. 4. For unpermitted improvements that have been identified and determined to have existed prior to the current owner's [seller's] purchase of the property but had not been disclosed/identified in previous City-issued resale report), not less than 365 days will be provided to the owner (seller or buyer) to correct, permit or abate before any code enforcement actions are initiated by the City. 4

18 5. An amnesty program shall be established and implemented on a bi-annual basis commencing in The amnesty program shall provide the opportunity for an owner to file for and obtain retroactive permits for unpermitted improvements. During the amnesty period, penalties will be waived; however, the property owner will be required to pay for all regular building permit-related fees. An announcement of the bi-annual amnesty program shall be noticed in the Marin Independent Journal and posted on the City website and/or other City media sources. The Marin Association of Realtors, the Marin Builder's Association and local neighborhoodlhomeowner associations shall be provided notice of the amnesty program. E. NOTICE OF COMPLIANCE In cases where no violations are noted in the resale report, or when the owner completes all corrections or remedial actions to resolve violations or unpermitted improvements, the Community Development Department Building Division shall issue a "Notice of Compliance." The Notice of Compliance shall be issued to the owner and a copy shall be stored in the City's property address/permit file. The intent of this notice is to establish that the subject property and all structures or improvements on said property, have been legally constructed, inspected and approved by the City and is in confonnance with the official permit records at the time of issuance. If illegal improvements which may have been overlooked or concealed are later identified which predated the issuance of the certificate, the City may provide written notice to the current owner detailing the matter, and post a copy of that notice in the property record for the benefit of any future owners of the property; however the City will not pursue any enforcement action to compel the property owner to legalize or abate the illegal improvement. F. FEES As adopted by separate City Council resolution, the City of San Rafael Master Fee Schedule includes an RBR application fee and an appeal fee for the owner or purchaser that wishes to appeal the results and/or findings of the issued resale report. The following fee policies shall apply: I. The Community Development Department shall offer a refund of the application fee where a "clean" resale report has been issued citing no violations or required corrections. 2. The Community Development Department shall waive permit fees and penalties for a violation(s) that existed prior to the current owner's (seller's) purchase of the property, where the violation had not been disclosed or identified in previous resale report. To obtain a waiver of fees and penalties, the owner is required make such a request before a building permit application is filed with the Building Division. The request must be accompanied by proof that the violation existed prior to their purchase of the property. G. PUBLIC EDUCATION The Community Development Department shall make every effort to provide the public with adequate, complete and up-to-date infonnation on the RBR Program. To facilitate this effort, the following shall be implemented: I. Staff shall prepare, maintain and update as necessary, an informational handout "How to Prepare for an RBR Inspection", which: a) explains the purpose and scope of the resale report and inspection; b) provides a list of what the City inspectors wilvwill not be looking for during an inspection ("The Checklist" referenced above); c) notes what the owner or purchaser should look for in the privately-commissioned 5

19 inspection reports to address basic health and life/safety; and d) lists resources for researching property permit history. The informational handout shall be posted and maintained on the City website and hardcopies shall be made available at the Community Development Department. The informational handout and any periodic updates to the handout shall be distributed to the Marin Association of Realtors. 2. A "How to Prepare for an RBR Inspection" video shall be produced and posted on the City website. 3. Staff shall expand, maintain and update (as necessary) a list of "Frequently Asked Questions" (FAQ) about the RBR Program. The FAQs shall be posted and maintained on the City website. 4. At the beginning of each calendar year, the Community Development Department shall host a "Coffee and Codes" workshop providing an educational refresher on the RBR Program. The Coffee and Codes shall be targeted for the real estate professional, public (seller and buyer), as well as the design and construction trades. H. SIX-MONTH PROGRESS REPORT AND REVIEW Six months following the adoption of Ordinance No. 1945, the Community Development Department shall prepare a progress report on the RBR Program. The progress report shall be presented to the City Council for review. BE IT FURTHER RESOLVED that any and all amendments to the RBR Program Policies, Practices and Procedures as deemed necessary from time-to-time shall be adopted by resolution of the City Council. I, ESTHER C. BEIRNE, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was adopted at a regular meeting of the City Council on the 5" day of December AYES: NOES: ABSENT: Councilmembers: Bushey, Colin, Gamblin, McCullough & Mayor Phillips Councilmembers: None Councilmembers: None ESTHER C. BEIRNE, City Clerk EXHffiIT A: "RESALE" INSPECTION CHECKLIST CC Resa 14243_adapted (RBR) 6

20 ATTACHMENT 3 RBR PROGRAM INFORMATIONAL HANDOUTS

21 "Resale" Inspection Checklist The primary focus of the resale inspection is to ensure that all structures and improvements meet basic health and life-safety standards as mandated through enforcement of State building codes. The City inspection will identify any improvements that may have been constructed without benefit of City permits, so as to ensure that they meet these minimum health and life-safety standards such as: proper foundations and structural framing to assure maximum survivability in an earthquake safe electrical installations to prevent fire or shock proper san itary installations for public health proper gas installations to prevent fire or personal injury appropriate fire resistance proper exiting - such as in case of fire or disaster room sizes and minimum light and ventilation to assure a healthy environment The City inspection report may include any of the following types of improvements: o Verification on the land use and number of dwelling units (e.g., inspecting for unpermitted/illegal Dwelling Units) o Basement and/or Attic Conversions (conversion of storage/crawlspace to habitable space) o Garage Conversion (the minimum size of a garage cannot be diminished by any improvements per the zoning ordinance - 2 car garage minimum 20 x 20; 1 car garage minimum 10 x 20; 2 car carport 18 x 19; 1 car carport 9 x 19) o Building Addition(s) (Additional square footage added) o Exterior Stairway(s) / Deck(s) / Balconies constructed or reconstructed o Outlets Added / Recessed Lighting / Circuits for Appliances Added (all electrical work requires inspection) o Plumbing fixtures added - water and sewer connections o o o Kitchen Remodeled (New cabinetry constitutes remodeling). Plumbing and electrical connections Bathroom Remodeled - Tub, Shower, Vanity (Vanity only is typically not enforced) Hot Tubs/ Spas. Electrical connections and grounding. Hot tubs on elevated decks can create a structural hazard. o Wood Stoves/Fireplace Inserts New gas line? New electrical? o Water Heater / Boiler Replaced o Furnace / Heat Pump / AC / Wall Heater Replaced o Carports / Patio Covers/ Trellis'/ Arbors/ Accessory Structures to ensure sound and safe foundation/framing and that there is no fire exposure to neighboring properties o Windows / Exterior doors added or replaced to ensure that appropriate windows are safety glazed, adequate ventilation is provided, and fire exiting is provided for the safety of the residents

22 What to expect from your 'Resale' Inspection A home resale inspection is not intended to serve as a structural, systems, or safety inspection. The private home inspector, if commissioned, will address those items. The City of San Rafael resale inspection is for the sole purpose of providing the buyer with a comprehensive list of all building, planning, and construction related code enforcement actions on record for the property. It is also to verify that any construction, alterations or repairs completed to the home, and/or accessory structures were performed with required permits and inspected by City staff. This effort ensures everyone is complying with state law for construction standards and the built environment is safe for our citizens. Prior to the actual resale inspection, City staff will research all permit records for the property and prepare a draft report for the inspector to bring to the inspection. The inspector wi ll visually inspect the home and accessory structures to determine that all existing improvements match the City's permit records. Non-permitted work will be noted in the final report and will need to be resolved. Every attempt is made to schedule the resale inspection on a date and time convenient for the owner or realtor. The inspection itself should usually take no more than 30 minutes or so. After the inspection is completed, the inspector will summarize their observations and may ask questions for clarification. Generally, within 3-4 business days of the inspection, the final report will be posted on the City website, and can be downloaded if desired. Please note: the last page of the report is a "Buyer's Certification" form. This form must be executed by both seller and buyer then returned to the City within 10 days of report issuance. Some common examples of unpermitted items found which are relatively easy to resolve include: Replacement Furnaces Replacement Water heaters Electrical: New main service / new recessed lighting / hot tub or spa tub; Replacement windows or Replacement exterior doors. These types of unpermitted work can be resolved by obtaining a retroactive permit any time during business hours (8:30 a.m. to 4:30 p.m.) at our building permit counter on the 3rd floor of City Hall located at th Avenue. Items requiring a permit will incur a penalty fee for work completed without first obtaining the appropriate permit. After the permit is obtained, an inspection needs to be scheduled for which a building inspector will come to the home, inspect the work completed and "sign off' the permit. If the installation is not per code requirements, corrections may be needed before the permit can be finaled. If corrections are required, the City will come back to the home to reinspect the work at no additional charge.