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RM JM BM EA WPFiles\StaID-pt\StaITq:il\HR&A Rpt JUl 0 8 1991
Councll Meeting July 8, 1997 Santa Monica, California
To Mayor and CIty Council
From City Staff
Subject Recommendation to Authorize the City Manager to Negotiate and Execute a Sole
Source Contract With Hamilton, RabinOVitz, and Alschuler (HR&A) in an Amount
Not to Exceed $98,740 for Preparation of Analyses Related to an Amended
Inc1usionary Housing Ordmance
INTRODUCTION
TIns report recommends that the CIty Council authorize the City Manager to negotiate and
execute a contract with Hamilton, RabInOVitz, and Alschuler (HR&A) on a sole source basis in an
amount not to exceed $98,740 to prepare analyses related to modifications of the City's
InclusIOnaty Housmg Ordinance which implements the requirements ofProposItlon R
BACKGROUND
The Draft Housmg Element (program Section 2 a) calls for studying modifications to the
Inclusionary Housmg Program In addition to calling for an analysis of expansion of the m-lieu
fee OptIOn, the program lays out a number of additional optlons to be considered Examples of
these are zomng mcentives in exchange for construction of30% affordable units on site, the
ability to satisfy the inc1usionary obligation by meetmg the reqUIrements of State density bonus
law, and the abllity to satisfy the incIusIOnary obligation by complyIng With the reqUirements of
tax exempt bond financing The study must mclude, but shall not be limited to, these issues
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JUl 0 8 1997
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DISCUSSION
In order to comprehensively analyze the vanous Inc1usionary Housing Program modificatIons
proposed in the Draft Housmg Element, financial modeling of prototypical resIdential
developments IS necessary AddItionally, analysis of the effect of zoning requirements on the
physical development of typical residential development projects will be necessary Similar
analyses have already been prepared by HR&A as part of the Housing Element Update In
particular, HR.&A has prepared the following related analyses an assessment of the City's current
Inclusionary Housmg Program (specifically, Ordinance 1615) as a potential constraint on the
development of housing, an assessment of residential rezoning actions as potential constraints on
development, and, an analysis of the R2 zone district bwldable envelope In preparing these
analyses, HR.&A created financial models to assess the feasibility of building on-site incluslOnary
units under a variety of development scenarios Also as part of these analyses, HR&A explored
the effects ofvanous zoning standards (such as allowable height, setbacks, and lot coverage)
upon the feasibility of developmg all inclusionary urnts on site
Because HR&A has already performed these analyses, the firm already has detailed knowledge of
several key Issues required for the new analyses Not only is HR&A versed in the complex issues
associated with the required studies, the firm has existing financial models which can be easily
adapted to perform the new analyses
Previously, Council has directed staff to prepare an amended Inclusionary Housing OrdInance
whIch could be adopted contemporaneously with adoption of the Housing Element. In order to
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meet this goal, work must begm as soon as possible Not only does HR&A have the experience
and staff capacity to deliver the analyses on a timely basis, but has been previously involved with
the development of similar financial modeling studies for Santa Moruca as well as other cities
FINANCIAL/BUDGET ARY IMPACT
Sufficient funds are available in account number 01-210-266-00000-5506-00000
CONCLUSION
It is recommended that City Council authorize the City Manager to negotiate and execute a
contract WIth HR&A In an amount not to exceed $98,740 for preparation of analyses related to a
revised IncluslOnary Housing Ordmance
Prepared by J eft'Mathieu, Director of Resource Management
Bob Moncrief, Housmg Manager
Ellen Alderman Comis, Senior Administrative Analyst
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