Menlo Park needs to work on its draft housing element before it can get approved by the California Department of Housing and Community Development (HCD), proving it can actually build what's in the plan.

The housing element update is a state-mandated process that occurs once every eight years — and this time around the state is strongly enforcing the regulations. The housing element requires cities to build according to projected growth, with an eye towards balancing jobs and housing. Menlo Park's housing target, also known as the Regional Housing Needs Allocation (RHNA), close to 3,800 new housing units by 2031.

Menlo Park submitted its housing element to the state in July, which predicted Menlo Park would not only reach its RHNA requirements, but exceed it by over 2,000 units.

According to Jeremy Levine, policy manager for the Housing Leadership Council of San Mateo County, the HCD is looking for cities to make substantial policy changes, rather than "analyze their way into compliance."

The HCD has requested more information from Menlo Park in its letter, including what mechanisms the city has to monitor and analyze projects in the development pipeline since it is relying on the units to meet RHNA allocations. The city is anticipating 3,644 housing units from projects that are already in the works — either proposed, approved or under construction — of which 594 are designated for affordable housing. Four of those projects are already under construction, comprising 925 units and including 140 units of affordable housing. Among those projects is Menlo Uptown on Jefferson Drive, which is an eight-story, mixed-use building proposal with about 15,000 square feet of office space and commercial space.

The HCD says that Menlo Park's capacity estimates are unrealistic and is requiring a methodology from the city to calculate the "realistic" residential capacity on each site.

Levine agrees that Menlo Park's sites were not realistically measured in the housing element draft.

"(The suggested sites) range from the unrealistic to the absurd," Levine said. "Menlo Park has a huge opportunity to build housing on public land. They own a ton of prime land in their downtown that is currently wasting away for cars instead of people ... Menlo Park doesn't make a coherent plan to dedicate land."

Another 454 units of affordable housing are coming from projects that have been proposed but aren't yet under construction, notably the Parkline SRI redevelopment project and Meta's Willow Village. Menlo Park has designated 85 units of Accessory Dwelling Units (ADUs) that could be built, of which 77 are affordable housing. One program encourages the city to adopt policies that incentivize the building of ADUs.

There are 2,153 units listed at so-called opportunity sites, where housing could be possible go in the future, of which 2,108 are designated as affordable housing. One notable opportunity site is the Flood School lot, which has sparked contentious community debate and become a focal point for both proponents and adversaries of the controversial initiative Measure V, which would revoke the Menlo Park City Council's ability to change the zoning of single-family lots unless voters approve it in an election. Some critics say that this would halt future developments for high-density housing in large swaths of the city.

The HCD also mentioned Measure V, telling the city to keep a watchful eye on the initiative and alleviate the impacts if the measure passes.

"If (Measure V) passes, the element must add a program to include outreach and mitigation measures for the impact of the ballot measure on housing development throughout the planning period," the letter states.

Levine concurred that Measure V posed a danger to housing in the community, particularly low-income housing.

"A referendum to build affordable housing is like a death sentence because no affordable housing developer wants to go through a time-consuming and expensive vote of the people just so that they can get their application approved," Levine said.

"It's completely prohibitive."

If Menlo Park does not adopt a compliant housing element by January 31, 2023 it runs the risk of allowing developers to use the so-called Builder's Remedy in the city, which allows for residential projects to move forward even if they do not comply with local development standards. This occurred in Santa Monica, during which time 16 projects and 4,562 units were proposed, according to the Santa Monica Daily Press.

Menlo Park will be reviewing the housing element and creating another draft for public comment.