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SR-8-A (197)F:ppd/share/ccreport/reconstl Council Meeting: April Z9, 1994 TO: City Council FROM: City Staff Santa Monica, California APR 1 9 ~ SUBJECT: Recommendation to Adopt an Ordinance for Repa~r and Reconst~uct~.an af AesXdential and Non-residential Buildings Damaged by the January 17~ 1994 Northridge Earthquake INTRODUGTION On March 1, 1994, the City Council directed staff to prepare an o~dinance ~rhi.ch ~,aould fac~la.ta~e recovery from the Narthridge earthquake by establishing deveiopment review standards for the r~pair and reconstruction of damaged buildings. In addit~on, the C~uncil directed staff to study various issue~ related to the repair and recanstructias~ star~dards and rev~ew emergency ordinances previously adopted in respanse ~a the Northridge eax-thquake. This staff report provides the results of the studies requested by Council concerning on-site park~ng, reeonstruct~on bonuses, and the finar~cial impact of the recanstruction standards and incentzv~s, and discusses the specific provisions af the earthquake recovery ordinance. APR 1 9 ~ ~ BACKGRDUND On March 1, I994, the City Cquncil r~vze:ti~ed the general parameters of a progra~ presented b}r staff for tl~e repair and reconstruction of residentlal and non-residential bui~dings damaqed by the Northridqe earthquake and dzrected staff ta prepare an ordinance ta implement thi~ prograr~. 'The Council additior~ally asked staf~ to study cer~ain issues related to the proposed repa~r and recanstruct.~Qn standards and return to Co~zncil :ti~ith th~ results of ~ts evaluations. The propos~d program~ is des~.gned to achieve the goals of facil~tat~ng a rapzd r~covery, r~azntainzng affordable housinq, and preserving the resldential and commercial character of Santa Manica. ~n c~eneral, th~ pragram provides for expedited perrnit pracessing f~r earthquake-reZated repairs and recon~tructian, aZlows damaged buildings to be rebuilt tv their pre-earthquake cond~tions (even ~ahen these cond~.tions do not conform to presen~ zaning standards), and ~stab~ishes ~nc~nt~ves for the rapid recon~truct~on of r~ulti-family ren~a~ developr~ent5. At the same time, the prograr~ es~ablzshes threshalds for compliance with building codes. This staff report is argan~zed around three major issues: 1) the results of the staff et~aluation o£ issues related to possibla parkzng r~quirer~ents and aev~lop:~ent bonuses for reconstructed btzildings; 2} a discusszon cf the results of a fYnanc~.al analysYs 2 af development incentives fo~ recanst~uction; and, 3) a descriptlon af the provisions of the proposed repair and reconstruction ordinance. The key r~comme~dations of thzs report are as folla4:s: a In-ki~d Repair and RecQnstruction; A~lo:a ~or in-klnd repair and reconstruction of legal non-can~ormzng structures and expedited permat processing; a Parkinq: Requir~ replace:~ent of pre-earthquak~ parkzng spaces~ but no add~tional park~ng; a Incentiv~s for Repair and Reconstructio~: For multi-family rental hous~ng, allo;~r a 15 percent square foatage bonus, a f~ve-foot heaght bonus, and decreased setbacks, as long as se~}~ack non-conformity is not increased, ar the pxa~ect complies wi~h t}~e mir~~mum setbacks ~n the Zonxng Ordir-ance. a AffordabZs Housing: 4:her~ affardable hausing rec~u~remer-ts are not imposed by Ren~ Con~.ro~, require tha~ 25 percent of the reconstructed units in residential housinq projects be affordable t~ lo~r- and :noderate-~ncor~e hauseho~ds. ISSUES ~'OR STLTDY In con~unction ~~i~h the dlrectian ~o prepare ~he ordinance, Counca~ d~rected staff to ~valuate specY~a.c ~.ssues related to the prapo5ed repair and recanstruction d~velopment standards, zncludang: 1) the need and desirab~lity of requ3ranq additional parkzng for 3 earthquake-damaged build~ngs havi~g substandard parking, 2) the feasibility of floar area bonuses ta encouraqe reconstruction of multi-family residential pra~ects, and 3) th~ f~nancia~ ~mpact of allowing developnent incentives for multi-family rental developments. Pazkinq Sta~f exa~ined pre-earthquake parking con~itzans in yello~~:- and red-tagged buildzngs in order to determ~ne th~ extent of underpaxk~ng. Util~z~ng co~struc~lon date~ obta~ned from asses~or fi~es, staff compared building dates ~•~ith applicable City parking standards at th~ time of constructi4n to estimate the amount of parking at each site. Residential Structures A reviettiT of the City's histor~cal parking require~^ents sho~•~s that there w~re no parking requirements for multi-fam~il~ resid~ntial development until 1937. In tha~ year, the C~ty adopted a requ~reraent of Z space per unzt for r~ulti-far~zly residential deve~.opment~ which repres~nts approx~na~e~y 50 percent of the City's current s~tandazd. In 1a48, this standard ~~•ras madif~.ed ~a require 1 space per every t~;o units far pro7ects above 5 units in the R2 zone, and 1 space per e~ery three units for pro~ects abave 10 units in the R3 and R4 zone, effecti~.;el~ reducing the amount of required park~nc~ for larger pra3ects. In 1960, the parking requirement fQr multi-far~~ly reszdential de.~relapment *:ras raised ta ~ ~ and 1/2 spaces per un~t, rr~~ese:~t~ng approxzmately 75 percent of ~he current star~dard. Ir: i975, ~he Czty began to require 2 spaces per un~t for un~~s ~r~~'.: ~wo or more be~rooms. Carrentiy, for multi-family a~a~-~~:e~~ ~eve?apr;ent, the C~ty requires 1.5 spaces per ane-bedroo~, 2 spaces per 2 or more bedrooms, and vis~tor parkxng for gro~ects of f~ve units or more. For condomim~ums, the C~ty requ~res 2 spaces per or.e or more bedrooms. Table I shows when iY:e red- and yellow-tagged multz-famaly buzldings were bu~lt in rela~zor~ to the time periods corresponding to different parking sta::dards. Nearly half of the build~.ngs were built przor =o ~937 when ~he City had no specific parkzng requirements. Appraximat~ly 19 percent were buslt between 1937 and 1959 when the Clty required approxamately 1 space per unit. Anoth~r 22.2 percent w~re built dur~ng the 196Q--~975 perlod when the C~t~r r~~u~red one and one-half spaces per unit. Less than 5 percent were constructed under the requirement of two spaces p~r unit far one- and two-bedraom un~ts. Sxte ~.nspections of several of the buildings showed that ~ndeed many of the pre-1937 developments provide substantially less parkzng than curre:t cod~ requ~res. For example, the Charmant apart:nents and ~ov~~e~gn apartments have no on-s~t~ parking. On the other hand, ~he E3 Cortez apartments provide 23 parking spaces for 90 units. However, tne E1 Cortez apartmenCs appear ta be the exception rat?~er than the rule for pre-1937 residential buil~ings. Mast are 5everely ~u::d~rparked and rely on stree* park~r_g. 5 TABLE I Construction Dates and Appticable Qn-Site Parki~ag Stanc~ards for a~l Yet~ow and Red Tagged 11tu!#i-Famil~~ Residential Builafngs ~s of 3/13I9~3 Time Period #} ~`c App~icab~e Parking 5t~~tida~d of BIdgs, of B1dgs. (generalized~`) Pre 1937 91 50 ~ E I~To required Parking 1937 - 1959 38 19 ~9 Approximately 1 spaceiun~t 1960 - 1975 41 ~? `' ~ 1 1!' spaces; un~t 1975 - preser~t 6 3 3 ~• .approx~rnatzly 2 5paces,'unit ;~'o date a~~a~iable ~ 6 7 ~ Total 180 1 QD ~ "~tandards may ~~a~ dependfng ~por~ un~t ~quare toataae a~d n~nnber of ~edrooms Ylease cansult applicable ordinances ~ t `•pp~`~share~~ccreport!~-zlrzct Non-residen~ial Structures Prio~ ~0 19~8, the City had na spec~fic ~zni~~um parking require~ents for retaal and office develop~ent. Beginn~ng in 1948i the City required or.e ~pace per 1,000 ~quare E~et for buildings ~arger than 2,500 s~~ar~ ~eet. ~n I96o, the requir~~ent was increased to one space per 30D square feet of off~ce and retai~ developmant~ which is the same as the City's current requir~ment. Table II sho~~rs that approximately 67 percent of the non-residential red- and yello~:--tagged bui~dings were lauilt prior to the tame that the City i~ad any applica~le park~ng requ~rements. F~nother 9.7 pexcent .aere constructed c~urzng the Z~=~8-1~59 per~od ~•.~hen the City required 1 space per 1,0~~ square feet, or app~oxir,lately one-third of th~ cu~rent requ~rement. anly 18 percent ~1ere built under requirements similar to current sta:~dards. Although a~arc~e prapartian of the non-residential buzldings in the City ~~°ere canstructed prior ta ~he im~osition of park~.ng requirernents, most stitl appear to provide some on-site parking. Site inspections of several af the pre--1948 buildings revealed ~hat on-si~e parkinq at:~ounted ta betT.~.een 30 and 6~ percent of the current o~-~~te parkzrq require:~er.~s. T'his r~ay be because o~.ners have provided parkinc; voluntar~l~.~ for bus~ness purpases, Qr because they have ]~een requared by the C~ty to increase parking as part of development applicat~ons. G TABLE II Construction Dates and Applicable Qn-5ite Parking Standards far Non-Reside~~t'sa! Red and Fel1o~~- Tagged Buildings as af 3I13/9~ Time Period # ~lo App[icable Parking Standat•d of Bldgs. of Bldgs. (generatized~} Pre - 19~$ 101 70 1~ No required P~r~:~n; 19~8 -1959 15 IO ~% 1 space/1,OQ0 s r for develapment abo~~e '',~00 s f 1960 - Present 26 1 S 0`~ 1 spacei 300 5 f No date ava~lable ' 1~ ~ Total 14~ 1 ~0 ~ f '.p}xl`~•chare`,ccreporr`~redyel Pazkinq Recomme~dation Even thouqh ~any of ~he earthquake~damaged buildings, especially residential bu~~dinqs, may have substandard on-site park~ng, staff does not recomnen~ requiring additZOna~ pa~king as ~art of the reconstxuction ordinance. Th~ prz~ary goal of the City's repair and reconstruc~iqn progra~ is to allc:~.~ pr~perty o~hners to promptly restare properties to their pre-earthquak~ conditions. In many cases, requiring additional parking cauld result in a substantial chanqe in bui~ding design and costs, ~~~hich cou~d in turn ~mpede the C~.ty~s goal of fac~latatinq rapid repair anc~ reconstruction. It is th~ opinion of experts cantact~d by City staff that lenc~~rs will be forgiving in terms of substandard parkzng, t~ the extent that they, toa, are eager to facilita~e rebuaiding. Moreover, since the number of residential units cannot be ~ncreased, and square fOOtage cannot be added to co~:~ercial s~ruct4res, the der~and for parking w~ll be no greater ~Y~an that exzsting priar to the earthquake. wnere a res~dential rental property o~~~ner :;ish~s to volun~arily increase pa~'king, or ~.here the lender r~ay require r~ore park~,ng as a condition af lending to such an at.~ner, the pr~posed ordinance a11a~•rs for an increase in pazk~ng. other Data on Red- and Yellow-Taqqed Buildinqs ~n order to deterri~ne key d~r,7en~ions of the ]~uildings that were damaged by the earthquake, data o~ the number of storles and nu~tber of units per buildinc~ ~rere gathered and analyzed. Table II~ sha~,as 7 Tabte Iii Bre~kdo~~~n by l~umber of Stories of Rer~-and-Yellow Tagged ~•ii~tti-Family Bui~dings as of 3/13194 ~1 of Staries # of A~Iult1-Fam~ly Bu11d~~as % Total 1 32 24.6 2 74 ~6.9 3 15 11 5 4 2 1.5 S 3 2.3 6 1 .7 Not Available 3 2 3 Totat 130 100~'0 Source• ly~b Janbarn Maps f lppolsharelccrepart`•.tab3 the number and proportion of red- and yelloL~-tagged buildings by number of storie5. The table sho°ti.s that the ma~ority (56.9 percent) of the buzldangs have t~~To stories. Approxlmately ane- quart~r {24.6 percent) have only one stary, wh~le another 11.5 percent have three stories. Less than five percent are ~ore than three s~ories. Tab1e I57 shows the breakdo~~.n among red- and yelloti~~-tagged buildings by number of unzts in the bui~d~ng. Among 177 residential damaqed buildings including s~ngle-famzly homes, approxiraately 34 percent cons~st of on~ flr t*,.~o F1T]Z~S~ th~a~, the r:a~ority have three or more units. Approxir~ately 18 percent of the bui~d~ng5 consist of betG~een 3 and 5 units; 3-.4 percent cons~st of bet,.~een 5 and 15 units. Approxir~ately 10 percent have bets~:een 16 and 3o units. Few buildings have more than 30 un~ts. Feasibility af Develapmen~ Bonuses The Council. directed staff to ~nvestigate the f~asibilaty and impact of per~itt~ng a developnent bonus as an incentive for the reconstruct~on of residential developnent. Zn evaluating the appropriateness of allo,•-ing ar. increase ~.n the pre-~arthquake size of rasidential build~.ngs, staff first determined that such an incer.tzve ,~ou1d be mast appropriate for multi-far~ily rental developm~ent. This ls due primarily to potential fox sign~fzcant loss of this type of housing as a result 8 Table IV i~Tu~~~ber of Red-and Yello~~-T~gged Residential Buildings by Number of Units in Building* # of Bldgs % # of Blc~gs ~ # oi Bldgs % ft Units Yellow- Tagged Yellow- Tagged Red- Ta~ged Red- Tagged Total Total 1-2 59 42 8% 2 5 1~ 51 34. 5~ 3-S 22 15.9% 11 28.2~a 33 18 b% 6-9 30 21 7 ~ 9 23 0~ 39 22.D% 1D-IS 17 12 3~O 5 12 $~ 2Z 12 4% I6-20 4 2.9% 3 7 b% 7 3 9% 2i-3a 4 2 9% 6 15 3~ 10 5 6% 31-40 Q 1 4~ 1 2 5~ 1 5% 41 + 2 1 4~ 2 5 1~ 4 2 3% TOTAL 138 100~10 39 100~/'o I77 1(}0% ~ As or s~ lsiy~ f lppolsharalccreportly~tr of the earthquake, and the goal art~culated by the City Cauncil to mainta3n a~fordabl~ housing. The develop~ent bonus dzd not seem necessary for can~o~inzun dev~lopm~n~ and s~ngle-family hames due to the fact that the candominium and single-family homeo~~ner, by virtue of the fact that s/he qenerally resides in the unit, already has a strang incentive to recanstruct; and, due to the practical di~ficulty of deterrnining ho~.,~ to distribu~te the banus ar.~ong the numerous condominiu~ns. The approach ut~lized by staff ~a deterr~ine the zncremental increasE in square footage that T,~:auld be necessary to pravide a signifacant ~.ncentive to enco~rage affordable housing develapment i~ described in detail zn t~e next section of this report. It sh4uld be noted that ri=h~le the sq~are ~ootac~e bonu~ -::i11 perrzt an ~ncrease ~n building square footage, it ~~:ill not perr~it an increase in the number of d;~~ellinq units. The City Attcrney has rev~e~•rpd the applicable State ZdGti' and determined that the 5tate ~ensity bonus provisions ~•-i11 not apply ta reconstruc~ion unc~er this ordinance. FINANC~AL ANALYSIS OF DEVELOPMEN`I' iN~ENT~VES The City C~uncil directed staff to eva~uate the financial impact of various alternative develop:~ent standards incent~ves for reconstruction. The analysis ~•:ould adentify a s~t of devela~ament 9 standards vrhzch c•:ould provide a sign~ficant financial incent~ve tQ encaurage rapid reconstruction ~•:hile sir~ultaneously achieving the City's goal af maintaining affordable housang. The fsnancial incentive F~ould equal or exceed other investment options, thereby providing a ~evel of econor.:ic return tha~ ~~ould be highly attractive to the o~,Tner. The firm of Katin, Regan ~ r?ouch~y (KRM) , Inc. was cont~acted to conduct the anaZysis. BEfore descr~bing the :~ethodology and results oF this analysis, it should be noted that there are many tactors Erhich go into the decisian of :.rhether to reconstruct. Thes~ include the exter~t to which earthquake insurance is available, the nature and t~rms of the d~bt encu~bering the praperty, and the fznancial circumstances af the o~aner, along F~ith the size, density, and configuration of the existing development. It ~•,ould not be passible in an analysis of this sart to capture all the possib~e cambinatians of fznancial and other clrcumstances facing an a,.~ner. rleverthel~ss, the analysis performed ~aas deszgned to capture a reasonab~e range of alternatives and dep~ct the rela~i~Te zmpact of different polic~es. Belor~~, the development sc~narios and assumpt~ons contained in the analys~s are described, the f~nancial ,=~ethodology and assumpt~ans are disctzssed, and a summary o~ the results are ~-eported. Developm~nt Scenarios and Assumptians The ana~ysas focuses en reconstruction, as opposed to repair. ~t 10 assumes that each structure ~•.•311 be demolished and reconstructed to its pre-~arthquake dir-~nsions, including numb~r of units and on- site parking spac~s; that all projects will b~ subject to a the req~irements af one af t~:ra rent contral removal processes; and, that al1 pro~ects W1~~ be eligible for a reconstructian bonus. Five r~ul~.i-fa:~ily develap~ents in the Caty that .~~re either red- or yellow-tagged as a result of tne earthquake tirere used as prototyp~s in the analys~s. In order to reflect the diversity of r~ulti-family housa.ng developments ln the C~ty, these pro~.otypes vary in size and lnclude 8, 10, 16, 24, and 42 unzts, respectlve~y. Four of the five developments are locat~d north af t:ilshire, :•~here the na~ority of the red- and yel~o:,~-tagged re~id~ntial bu~ldings are lacated. The reconstruct~on scenar~os focus on the different~al impacts of twa key variables: square footage bonuses and affordable ho~sing requirements. Square footage banuses af 4, 10, 15, 2D, and 25 perc~nt ~Jere analyzed. Tt .•~as assumed that there ti~:a~zld b~ no increase in the o~rerall nu~~ ber of units zn each developr~ent, and that the increm~ntal squar~: footage fro~ the bonus ~Tould be absorbed by the individual units. ~q~are footage bonuses would anly apply to existing ~ulti-family apar~.ment develo~~ents. Alte~native affordable haus~ng requiremer-ts o~ Of i5, 20, and 25 percent are analyzed. The 1~ percent affordable requirement scenaria, applicable to an ~arthquake Category D rer,lova~, assurnes 1~ that the affordable uni~s 1:auld be affardable to lov~er-income households (i.e., househo~ds earning 80 percent of the Los Angeles County med~an inco~e). This scenarzo also assumes that the remaining 85 percent of the un~ts init~ally would be rented at market rate and thereafter be sub~ect ~o rent control. Applicable ta an Earthquake Category C removal, the 20 and 25 percent alternative affordable requirements assume that exactly half of th~ afforc~able units :•~ould be affordable to :r,oderat~-income households (i.E., hous~holds ~arning 100 perc~nt of the Caunty ~ed~an hausehold inco~^e) , ~-rhYle thn renaining half c~ould be affordable ta IbT]-11']COi`le househo~ds (i.e. ~ hauseholds earn~ng 60 percent of the Caunt~.~ r~edia:~ household zncor~e) . I'he balance of units in each de~>elopment ~•~oald be ~:~arket rate ~nzts and not subject to rent control. Affordable units ~,,rere asssmed to be 600 square feet for one- bedroor~s, 850 square feet f~r 2-bedroo?-~s, 1, 080 square feet for 3- bedrooms, and 1, 260 for 4-bedrooms. The nur.~sber of affordable un~~s in each d~velopment ~:~as deter~~lneci by using a 0.5 round-up factor. For the 25 percent affoxdable hous~ng requirenent scenarios, ~t 4~as assur,~ed that the first affordabie unit E•:auld be affordable to a maderate-ineome household, the second unit to a lo4•:-income household, and thereafter alternating. Financia~ Methadoloqy and Assumptions The financial ar~alysis focuses upan the cost of reconstruction fror~ I2 the perspecti~e of the existang property o~Jner. The objectlve of the analysis ;,~as to determine if the propert}= o,:~ner cou].d recover original (pre-earthquake} net operatinq incame (P3oI) and also obtain a significant additional financial return on investment to ~ncourag~ reconstruct~.on. Origanal net operating ~nco:~~ (r:ol} ~aas calculat~d using gross rent levels pr~v~ded by the Rent Cantro~ Departr-~ent _ operat~ng expenses u~er~ estimated based on an average af $.27 per square foot per month. NO~ was calculated by reciuc~.ng total rental incame by operating expenses. The new NOI (that is, the NOI from the ne~r~y reconstruct~d bui~ding) ~s calculated based upon xnco~~ from ne~~~ rents minus operating expenses. Margznal income, or the d~fference b~ts;,reen rental incorie genera~ed after r~construc~ion and r~ntal inco:~e prior ta the ~arthquake, ::as th2n caleulated by subtracting the original NOI fror•: the ne:,• :~lOI. I'aking the :~arginal incam~ and dividing by the cost of rebuild~ng yields the return on investr-~ent (ROI} on ne43 invest~ent capital. The analysis considers only the return on investment durzng the f~rst year. Threshold ROI In order to establish a threshold return on investr~en~, three main factors must be consi~ered: the availability and eos~ of equity capYtal; the availab~lity ar~d cast of debt flnanc~ng; and, the 13 expectatian of future rents. ~ar the purposes of thzs analysis, a Ioan-to-value ratio of 85 gercent is assumed, Xt is also assumed that debt f~naneing ~~°ould be obtained at a rate o~ 8~ereent, .vh~ch assumes a combinatiQn of market rate and Snall Business Ad~~n~stration (SBA) loans. Equ~ty capital--that is, the por~ion ~f funds needed to cover the remaining 15 percent of the cost of reconstruction--is assumed to require a rate of retuxh af at least 20 percent. In o~~Qr words, in order to provid~ tY:e o:•,n~r s~gnificant incentives ta reconstruct as opposed ta in~~est ~he sar~e cap~ta~ in anather investr~ent, s/he would need to real3ze at least ?0 percen~ return on that capital through recan~truct~on. The chart balow~ sha.L~s ha~r.~ the threshold return, or ~he minimuri financial return required in order to prortpt investr-~errt~ is calculated on the investment n~cessary ?n order for the o:•~ner to meet the deb~ serv~.ce on an ~ percEnt loan and still obtain 20 p~rcent return on the eq~ity portiors of the investment. Calculating Threshold ROI on Entire Financing (Debt plus Equity} A. Debt Portian: 85~ Loan x 8~ Interest Ra~e b.8~ B. EquiLy Portion: ia~ ~o;.n payment x 20~ Return on Investment 3.0° A + B = 9.So 14 The table shovrs that the co~b~ned threshold ROI far the debt and equity portion of the investm~en4 is 9.8 pe~cent. Th~ threshold ROI of 9.8 p~rcent also assumes ~ha~ apart~ent rents would increase :•rith the norr.-~al irsflat~an rate. Ho~n~ever, threshald ROI ~•:au~d be same~•:hat higher ~or units Tr~ith contro3led rents. Based on the City's prior experience •~ahereby controlled rents increased at approx~mate~y 70 percer~t of the CPI, KR~~ has estimated that the thr~shold RpI ~•~ould have ta be ad~usted by .7a percent to provxde a property o:•~ner ~•,~th an equivaJ.ent long-ter~n rate of return, thereby req~z~r~ng a 1~~ ~~ R~I ior un~ts su~~ect ta rent cantrol. Other Assumptions A numb~r of other assumptions factor into the analyszs, including assu~nptions about market rents, aperating expenses, design and construction costs, park~nq costs, and overhead costs, amonq others. Ihe standard assu;npt~ons used in the analys~s and a sample profarma are eambined ln r~tachment A. Because of the na~ure of the assumpt~ons utilized ~n this analysis (~.e., cansideration af pre--earthquake net operacing ircome and exclusion o~ land costs), the appraach taken is not transferabl~ t~ an d1~131'y'S15 of the financial feaszbilit~~ cf n~;r constracr.icn. ~~ Results Table V shot~-s th~ r~~u~4s of this analysis far the different affardab~e and square footage bonus levels. In order to interpret the table, it is ~mportant to keep ir~ mind the applicable threshald ROI at which netiv development is likely to occur under each tk'pe of Rent Control removal perr~at: for Earthquake Category D removal, 1a.55 percent (9.8 percent p~us 7~ percent to factar for addYtional return requzred for the rent controlied ~nzts}; for the Earthquake Cat~gory C removal, 9.3 perc~nt. Staff utiliz~d Table V to ident~fy an appropriate combination of squax'e fbotage bonus and affordable hausing requirements that u:ou~c~ meet the threshoid RoI und~r either a Cateqory C removal, w~th a 2~ percent affor~~able r~q~irer~ent, or ~.h~ Category D re:~oval, .+rith a ~5 percent af~ordable rEquzrement. The ta}~le sha~~:s that severa~ combinataons of affordable requirements and squar~ footage bonuses r:eet the threshold ROI. Far example, nearly all protot~:pes provide sufficient financ~a~ return under the 20 and 2~ percent sc~uare faatage banuses and a~.1 affoxdable housing requirer~,ent l~ve~s to encou~age reconstruction. In addition, all but one prototype would meet the threshold ROI. In particular, under the 15 percent square footage bonus allo~tiTance, the threshold ROI ~s me~ for four of the fir.~e proto~ypes under a 15, 20, or 25 percent aFfor~able housing reqa~re~~~ent. More specifieall.y, the threshald RaI is :net for Prototypes 1, 3, and 4 16 ~~r~n.Re~n d~ Maw:hly. ~NC i Ta b 1 e tr SUMMARY OF RE5ULT5 SCENAR IO: Market Rents & Replace Original Parking Inclusionary Units Cafculated with Moderate Income Units First ~ PB0T07YPE PROTOTYPE PltOTOTYPE PROT07YPE ~ PRaTOTYPE APARTMEMT CHARACTER15T1CS No f No 2 No. 3 No 4 No. 5 Number nf Pre-Qu~ke Umts 10 units 8 umts 24 wuts 42 umts 16 umts Aver.~e Pre-Quake Un~t Si~c 118U sq ft 774 sq ft 755 sq fi 144p sg !t u11 sq ft I'otal Lul Svc 7500 sy ft 75U0 sq R 223GU sq (C. 34640 sq ft. 108VU sq Ft Tntal Pre-Quake Parkuig Spaces 15 spaces 5 spaces lo spaces 84 spaces 19 spacx,~s Tntal Req Spac~rs iF ISldg Replaced 75 spaces 5 spac-~~c 10 spaces 84 sFuoes '19 spaocs R6PLACEMENT OF STItUC7URE5 ~ e urn on - e~CTon ~ e~um on e~ urlE~ n an ~ e urn oe AVERACE Returnonlnwstmr.nl lnvestment Invesfinent Investment Investrnent InMestment VALUES ~~~ NO DENSITY BONUS CRANTED '~ No Inciusionary Un~ts Req'd {ren[ c.ontroll 12 ~3q5 F! 7ry5 9 7°~ 9 9% 9 096 10 096 15°~ of Unrtc are Inclusioriary Srent conlrol} 12 79~ 8 7qo 9 3°yo 9 3qb ff 7% 9 796 20~, of [lmts are Inclusionary 12 4% E! Sryb 9 39~ 9 1 ryb fS 4ryG 9 G96 25'~ nf Unlts arc iACluswnary 12 5% 8 59a S 9ry5 8 9yb 8 39~ 9 4qo i 4q6 DET~15llY BONUS GRAAITED No Inclusionary Unrts Rirq'd (rent contrcil) 13 6ryo 9 4go 70 G96 10 7$6 16 Oqo 10 9'9a 1S%of Umts are Indusionary Srenl cohlrol) 13 4% 9 5q5 10 3qo 10 2°~ 9 7~0 1Q G96 20%nf Un~ts are Inclusionary 13 1;6 9 3y~ 7p 390 10 135 ~3 935 10 Syd 25%oF llmts arc Incius~aiary rt3 2% 4 3% 70 0% 9 S~b 9 496 10 396 159o DENl51YY BONUS GRANTED hRo Indusux~ary Units Req'd (reo~t control) 13 990 9 7qb 11 OqG 11 1% 10 4qG 11 2% '{5~0 of Umis arc Inclusionary (rent cx,ntrol~ 13 7qo 9 89~ 10 796 10 G% 10 2~ 71 096 2o%of Uni~s arc Indusionary 13 490 9 696 10 796 1Q 596 10 396 10 9% 25~ oF Unlts arC Inclusionary 13 Sryo 9 G96 10 4qk 10 396 9 896 1U 7q6 2D% DENSITY BONUS GRANTED No Inclusionary tlnrts Req'd (rent c.'orllyd} 14 19G 10 09L 11 4q6 7 l 5~, 10 8qo 11 G%o 15% of Un~ts arc inclusionary (rent contrrrl) t 3 9% 70 1 ry6 11 196 1 T 09b 10 6% 11 3'% 2096 nf tJn~ts are Inclus~onary 13 7qS~ 9 9go 11 130 14 ti% 10 7qb 11 296 25%uf Un~ts are lnclus~onary 13 iS'yb 9'.?96 10 A96 70 7% 1~ 33u 11 196 25% ~ENlSITY 84iVUS GRANTEp No Indusionary Uni~s Req'd qrent cantrol) 14 496 10 3% 11 896 17 F~% i1 296 19 99b 159b uf Umts are Inclusionary (rent oontrd~ 94 296 1q 4% 11 5% 11 3% 71 095 11 790 24% a( Units arc Inc.lusionary 14 096 14 2y6 1 i 5% 11 296 11 29b 71 696 z5%o( Units are Inclusionary 14 9% 70 2% w.~.~ 11 2q6 ~ 11 0% ~~..~ 10 7gb ~ t1 496 ~ oaroaroa Fae SMC9aqNnNM1C]pFl1SUM1ULIY[2[ f4epgiedfOrf.Ryo(SanpMonks with a 15 percent affordab?e housing reauirement, and for prototype 5 with a 25 ~ercent affardable hous~ng requ~re~ent. At the same time, the table suggests th~t, ~:ath a 15 percent square footage banus, ar~ aPfordable housing requirement above 25 percent u~auld nQt provide the thr~shold ROI desired to encourage reconstruction. Consist~nt ~f~ith the program goal of :~a~.ntaining the character af existing developr7ent and neighbornaod~, staff recar-mends allawing the minirtur~ square foo~age bcr:us needed to ~-eet the threst~old RaI. Based an prec~c~ing analy~sis, th~s ~s ~5 percent. The 15 percent bonus ~;rould provide sufficienL financial returns either at the 15 percent or 25 percent afforda3~le housing ~equ~rerr.ent level to stimulate r~construction. Th~refax-e, staff is recommending a 15 percent square footage bonus along ~,~ith the follo.:ing affardable housing requirer~er~ts for reconstruction: o For Earthquake Cateqory D re:~ovals, 15 percent of the units shall be affordai~le t~ lo-aer-incon~e nausehoids, and, o~or Earthquake Category C rer~~ova~s, 25 percent of the units shal]. be deed-rEStric~ed for affordabl~ housing~ GTith ha~f affordable to t~~oaerate-income households and ha?f affordable ta lo~~:-inccr:e households. 1~ REPAIR/RECONSTRUCTI~N ORDINANCE PRpVISIONB The key sectlons of th~ Re~air a~d Recons~ructzon Standards Ord~nance are as fa~lo:•.~s: ~Yndings and Purppse ~Section 1), Definitions (Section 2) , Develop:;~ent Standards and Use Restrictians (Section ~}, Affordable Housing Obligation (Sect~an 5), Permit Application ar~d Revieti•r prccesses (S~ctions 6 and 7}, Standards for Revie~r (Section 8), and Buildlr.g Stand~rd Compliance (Section 11}: The fo1lo~:ing discussior cutlires the key pravisions af the praposed ordznance. Key Provisions In the int~rest of rav~ng clear and rea~il~ understar.dable rules that w~l~ fac~~atate re~?air and reconstrsction, the proposed ordir-ance se~s forth a sincsle set of standards and procedures for repair and recor:struction :-°hich o~;~errzde the exxsting ZanYng Ordinance. In for~u~ating these developr„ent standards, staff has attempted to considex a range of re~ui~d~n~ 5cenarios to address a ~~ariety of s~tuations that :~iaht reas~nably ]~e expected to accur. Nev~r~hel~ss, as applications for repa~r and reconstruction are pracessed, ~t r-iay beca~e apparent that nodif~cations and requi,rerzents are necessary Staff believes that the Cit~= shauld be open ta such modlfscatians ~~hen it is apparent that they could improve and expedite the recc~.~er}~ prccess. ~s The provisions of t~e praposed ord~nance, including the repair and reconstructian threshold criterYa and revze.~~ procedares, and the building and safety requiremer~s, are descr?bed jn deta~l belo.~. Repair/Reconstruc~ion Thresholds and Review Process The proposed ordinance estabZishes a four-tier revieTf~ pracess for repazr or reconstruction, t•:ith the requzred Iev~l o£ r~VZ2W continqent upon the extE?~t and cost of tne damage and the scope of changes ta the project. i:~hile scme ~ra~ects r~ay be sub~ect to mare than one af the follo::~ing steps, a11 pro~eets ~f:ill ultimately require at least a plan check. Plan Check Only The falla<<Ting pro~ects ar~ sub~ect to a plan check re~iew process only: 1. Structures ...~here the repazr c~sts are l~ss than 500 of the est~mat~d replace:t-~ent value of the structure and are reconstructed to the hezght, setbacks, denszty, number of and type of un~~s (apartr~ents, condom~niums), design and parking that existecl prior to the earthquake. 2. Structures ,~~here the r~~alr ccsts are greater than 50% of the estlmated replace~ent value of the structure, and ~•rh~re less th~n 50% of the ex~.erior wa11s tyill be demolished, and t?~e bui~dinq is reeonstructed to the height, setbacks, density, nur~ber anc~ ty~e of units (apartments, condo~~niu~s), design, and parking that existed pr~or to the earthquake, ~xpedited ARB or LandmarkJARB Review The folloG:ing pra~ects are sub~ect ta an expedited Architectural Rev~e~•: Board process, or Landmark/ARB re~iew pxocess if applicable, and 4he;~ sub~ect t~ a plan check revie~,~ 19 pracess. l. 5tructures ;ahere the repair costs are qreater than 5a o of the esti~nated replacer~~ent valu~ of the structure, and UThere more than 50 0 of the exterior :aalls Lrill be demolished, and the ne~T development ~s belottir the d~velopr~~ent revie,: thresh~ld for the distr~ct in e.h~ch it is located. Tt:~ Land~ark Co:~:~ission members are required ta rev~e.~ and vote o~ the praject as part of the ARB revae;~~ process if the pro~ect involv~s a landmark or potential iand~^ark. Expedited Administrative R~view If the pro~ect is cons~ste:~t c•Tith ~he above threshoids, yet the project moc~~fies the flooa~- area, hezght, or fontprint by no raore that 1~ ~, th~ pro~ect :.~ill be sub~ect t~ an expedited adm~nl~strat~ve revie„ pr~cess. A~t~r cor;p'e~ion of the administrative revle,-~, t?-~e pro~ect ,~.ill be sub~ect to the ARB or ARB/Landr;ark Revie~•r ar;d plan check process~s outli~ed abo~e. Expedited P~anninq Commission Re~iet~r The follo~~.ing pro~ects are sub~ect to an expedited Planning Cor~mission revie~,,~ ana tren subject ta a plan check revieNr. 1. Structures 4rherz the repair costs are qreater than ~0 o af the estir-~ated replace:~~ent ~Talue of the structure, and ~~here mar~ tnan ~C% of tr,~ exterior ;.~a~ls ~h~ll be de?~alished~ ard the structure is abov~ the developr:lent revie~,~ thresholc~ for t~e d~strict in T.~hzch it is located. Requirements Unique ~o Residential Uses The develapm~nt threshalds and re~Tie:4~ processes are nearly zdentical fcr reszc~ential and ~~n-residential deve~opr~ent. 20 However, the pravisions for the repaar and reconstruction af mult~- family rental deveiop~~ent dzffer ~n that they a~la~:~ ~evelop~ent incentives for recorstruction and, ~ahere afifardable housing r~quirements are not iTMpo~ed ~~- Rent Control, establ~sh ad~itzonal requirements for a~fordable hou~~n~. BUildinq Code S~andards The proposed ard~nance contains ~he fo11a4~,=ing bu~ldinq standards as directed by the Counc~l. These standards are bas~d in large part upan the 5tate I~~ode~ Ord~nances. o bvhen the estimated value of repazr cloes not exceed 100 of the replacen,ent value of the structure, oniy the c~amaged portions may b~ restored to ~ne~r pre-disaster condition This appZzes except ~•~hen the dar~aged elements include suspend~d cexling syster~s, in tiahzch case the repair must comply with the current technical code. o When the estimated value of t?~e re~air is greater than 10% but less tnan 50% of the re~lacement value of the struc~ure~ the damaged e le~ettts , as ~~~ ~ 1 as the cr i~. ica ~ t ies , supported ele:~ents and suppart3ng elem~nts associated ~~ith the dar~agEd elements, shall be repasred and/or brought into conformance ~~~th s~ructu~-al requ~rer-ents of the c~rrer~t technlcal code. o Gdhen the estlr~ated value of repa~r is 50% ox nore of the r~placer~~ent value of tl~~ structure, the ent~re structure shal~ be braught into canfart~anc~ ;•~ith the eurrent technical code. o Landr.:axk el~r~ible buildirgs sha11 comply :•~t'.: the above provisions; ho::~ever, ar. oT,r,er r:ay rec~uest a~odificatzan to the abave pravis~ons as long as the modzf~cation is consistent with Part S, T~t~e 2-, C~,~f~rn~~ Cad~ of R~;~ulat~ans, the State of Califarnia Histcric Build~ng Code_ Other Provisions The repair and reconstructior ordinance contains various ather provisions t•~hic~ are descr~be~ beifl~-:. 21 o Environmental Revie~: (CEQA): The City's existing admin3strat~ve C~.QA Gu~ddlines do no~ pro~,;ide for an exemption for reconstructian af~er a natural d~sas~~r. Therefore, the proposed ordinance esta~~l~shes a cat~gorical e~e:~ption for all pxo~ects receiving an Earthquake Recovery Permit. o Parkanq: The ~roposed ardir~ance requires that the a~rount ~f on-~ite park~nq be no less than that prov~ded priaz to the earthquake. o Riqht of Re-Occupancy: The pro~aased ordinar:ce establishes procedural requare~ents governzng the r~ght af reoccupancy of res~.dential rental units by tenants displaced fram these un~ts due to an owner's need to repa~r or reconstruct an earthquake damaged structure. o Non-confcrminq Uses: The same use that eXlstecl prior to the earthquake may be re-estab~ished. For non-residential structures, noncanforming uses r~ay pe resurred after repair or reconstruct~on, or may be replaced ~:ith conform~ng uses. Conforming ~ases ray be changed ta other confor~ing uses so ~ong as the park.zng _reqti~rement for the ne~~.~ use does not exceed the parking require~~nt for the pre-ea:.-tr~~uake use. o Non-conform~nq bu~ldinqs: G~h~~e the proposed ordi~ance will perrit the "in-k~nd°T reconstruction and lir~ited ~xpans~on 2? of existang, non-ccnfor~ang bul~d~ngs, any expans~on in the non-canforming building beyond the li~its spec~fied in the proposed ardinance L,7ould be sub~ect to the non-confar~~ng sectian (Sectian 9.Q4.18) of the Zoninq Ordinance. o Demolition: DemolitYdn c•~ould be perr~itted as ~art of an Earthquake Recovery Permit and only upon issuance of a bu].lding perr~~t. pemolzt~ons zn any other circumstances tiaill be proeessed accordinq_ to the existzng City procedures unless the de~o~iticn ,~as ordere~ b~,~ the City`s r:uisance Abatement Board. o Timefrar~e for Re~aairs• Consistent with Council directian, the ~roposed ordinar~ce :•~i~ ~ requ~.re that building per:~its for repair or recanstruct~.on be issued ,:zth~n t:•.o years of date of the ordinance. o Tzr~e Lamit for Permit Proeessana: The City C~uncil asked staff to cons~der and Yeco~r~end appropriate time limits for the processing of perr~~ts for reconstruction. Hoti.ever, until the volume af app~ications is knof=n, staff zs ~eluctant ta comr~i~ ta a specific ~imefrar-~e ~rithi~ an ard~nance. Staff will pracess the ~p3~liC3tlOT7S ~xp~dit~~usly and, once the volume is better kna.•~n, develo}a timelines for pub~ic distri~ut~on. o Construct~.on Hours: The council or~ginaily d~rectec~ the 23 establishment of t°~.o 5ets af cons~ruct~an ~ours, on~ for resident~~l and th~ ather for non-r~sidential deveiopment. Hot.~ver, due to the dlfficulty af enforcYng t4~o sets of standards, staff is reco~~ending a single standard for all development, as follo:•~s: from 7:00 a.m, to 7:00 p.m. on ti~eekdays, and 7:G0 a.m. to 6:Ofl p.r~. on Satuxdays. o Repair or Reconstruction Pra~ects Sub~e~t ~o ~xist~ng Zoning Ordinance Standards: Any structure that does not qua~~fy for an Earthquake Reco~Tery Perr~~t shall ~e sub~ect to the present Zoning Ordinance stan~a~-ds. o Suspensian of ?lorth of i;?ilsh~~-e Construction Rate Proqrar~: T~e pxoposed ordinance exempts all repair and recanstruc~.ion pro 1 ects in tlze ~r orth of G•. i Z sY~, i re area f rot~ the North of ti~ilsf~ire Construc~ion Rate Proqra:~. o~'erificat~on of p?-e-existinc~ bu~.ld~nc~ d~rtiens~ons: At ~east t4JO sources of docur~ntati~n des~~onstratir~q the prior ~evelop:~ent con~i~ions of th~ bua~dinc~ sha~l be required. a D~terTM~ininq R~aar and Reco__nstruct~on_Costs: For purposes of deterr-kinznq th~ cost of recor~struution, tne p~-operty a~:ner ~.ill b~ r~quire~ ~o s~bmit a~.~ai~d contrac~ .lith a licensed contractor for the repazr s.rork and t:•,o est~:~ates fron praperly licens~d contractars for the repair t:ork. I'he estimates ~aall 24 be r~quir~d to conta~n suff~cient detail to ascertain the scope of the proposed :-:ork and ~nclude prof~t, overhead and insurance cost. The City t,Yl~ de~er~zne the replacefient cost by using the quarterly ad~usted, natio~all~~ recogn3zed, construct~on cost ~ndicators for bulldings af s~~~11ar use, constr~ction and ar~~it~~5. o Increasinq the s~z~ and numb~r of reszdent~al units: For res~den~ia~ uses, the square foatage and number of bedxooms af ~nd~v~dual unlts ~ay be znczeased. HoTti~ever, th~ number of units m~ay no~ be incr~ased. a Heiqht and Setback .~~o:~~f ica~ian~ for buildznq and safety reasans: Bui~d~ng ~o~ifications ~;auld be perr~it~ed in order to comply :.ith te~hnical consCruc:.t~.on eodes even though Lhis may result in r~odYf~cations to ~he height and setbacks. o Fee ?r:aiver: Th~ propos~d ordinance au~horizes the City r~anager ta G~aive an~~ and all ~er~~_it process~ng f~es r,ti~hich r~ay other~a~se be necessary for the repair and reconstruction af earthquake-damaqed buiidinqs. This is consistent ~aith th~ Cour~e~l's pre~tious ~c~icn. The proposed ordinance does not prevent pr~perty o~.nezs ,~~ho have purchased theZr propert}l aLter t~e 3anuary 17 eartnquake from applying far an Earthquake R~covery Per=~~t. 25 Finally, the praposed crdinance ~odifies the C~ty's standard se~erability clause ~n that lt stlpulates that if any section of the ordinance is found tQ be inva~a.d or unconst~tutional, the ent~.re ordinan~e shall be considered ir,tiral~d. STATUS ~F QTHER EMERGENCY ORDINANCES Since the Nor~hr~dqe earthq~iak_e ~he C~ty Counczl a~lopted several emergency ordzr~ances t~ a~~ress the posti-earthquake conditians. The follo4Ting sumt~arizes the status of the adoptea ordlnances: brdinance 172a: Jr~anar.ce s~<aivzng de~ela~*~~nt related fees. T'his ordznance is being rep~aled in Sec~ion ~~ af the prapased ordinance. I'he fee s,ai~rer provisions are no.a included in Section 15 af the propose~ ardinan~e. Ordlnance 1722: Ordinance requ~ring structural engineering r~ports and restoration oi v~tal build~ng systems. This cr~inance is being repealed since the propose~ ordinance no~; reqair~s the subr~ission of a structural eng~neerirg report ~,r~or to the ~ssuance of an earthquake recovery perr~it. =~ requ~r~ment to restore vital building functions for gr~En-tagged build~nqs is no Zonger necessary. Ordinance ~723; Orcii::ar:cz reguia4ir.g price inczeases. This ardinance ~•,i11 remain ~n °ffec~. 26 Cr~~__~~_ve - ~ ~ ~~r:.---_ _ ~ - ~~_Ct~.~: C. ~ril~7 ~~..~.~~1:....__.~~ Zn'.`~'_.~L-'.~~CQ _1~ rl_..~".. FJ rl7uVC ~~ ~'i~~ ~oard a~:~~r~ss th~s ~ss~~. _~~~.~_ _j~_~ ,"~ ~ ~:,r~ _.~~,.'r .,. ±E~G~_ _~ %_-~~~:ila '~~; '~"r~~=..1 ~:l'_:1,~ ~__~ u'ri..'~-~~.1'•~rEJ ._~u~'..~'C G~_'~A G~.l'.i~rC~.l 1.:~` _._ - _"K~=~1~ ~-v _~r~il O~d~_~~~^e = Y~ ~:~ru~.=~~n~~ r~-µ~l-~r~i-_n r~ .~_~ ar_ __~.~r_~~~LCt,.-,~ prcce~~ares _~_ aa~~u~u ~t~t~~tt~-~.~. `~~is ~r.~~n~~~~ ~s ~e-r_g repeGled s~:-ce ~~r~ ~Y~ v4Y ~Y~_r_~~vv ~~ ~_ _~rtr~ _--~ =~~~7 f~.. sta^~ :r~~ . CEQA Un~~r ~ec_i~__~ =~~~~~;, y-_ "~"', .___ i =~' = ot ~r= ~a-==~.,--_~a =_1t~~r~~r,.~.~. t~~ ~Y:; ~_-t- : ^'- , _ :}_-y ~r~ ,-- --~~;~r A- .-~~ai~~. ~ J~~~..~ .~_ c'_T`'_"C~~1: cv a_-~l^-- .,_ a-- ~z_ _~ ~.~~_~ ~~ ~~L~=~_ ~~L~~~~~ disa~r2r, r~~s--d~~g _~rc~~-~« ~_re ~.,:r~_ - -~~~:r =r~°--Y.~~: --r_tal ~~.--~,•,~. BUDGET/FINANCIAL IMPACT T::e ~ec~~:r~r~ _~G`-~--., ~-- _=-_~ _ ~='~ : _~_ _i : `e ~ ~-~~__..~~~ _:-~~~c~ c~s~ tG t.i~ .n_ . ~ ~ ~- . ~iI°~~ t:- _~ _~ _"-_ , 1 ~ l~ ~ _•_- ~ _ -_.,, =::cr =~1~5 .,_-- r_o~ ~,~ ~ ~i~~r_~~~~~:_-- _- " _- _~ RECOI~KENDATION 5~~~~ r~~~r~~-~~~a.a~ ~:~~~ ~--- .-- ~ ~-~.----_- .~_..:~.~* a ~~~_~~ ~.-.~~ir_~ a:_? ~~~^-~~ ~~e _~r~:.~uG~=~ r~ _i: .~ a ___._~=`fi`'~-~=--- _~a_::~r_~-. F~?FGr~a ~, ~...~..u---=~ ~ r-~=~, i~:=~. =-~~v~~=r ~'c'_.l _,~5~ '~ --"r-1: .,~.Y1=^~r' ~_c:'~:7cr `~a~ _ v .~i, =_~_ ~~~t= --u:.~~r' ~ttacr~~r~t~ __ - F=r~T-, ,- _ ,F~.,~,- ;ra~ ~i~ _ _~~mrr= __~ ~r.~ ~'_.. E'~__-~~. ~ - - ~ - Re~ar_ _ _.~, _ ~-_---~-_-___~.~_~ :,Ya~.aa_ ~~ A TTA CHMENT A SENT ~Y~K~?IN REGAN ~~UCHLY ; ~-i1-~4 : 4~17PM ~ 1310~ZC1743y ~1~45$339p~~ ? Attachment A SANTA MbNICA A~'ART~+iENT REC~N~TRUCT~ON ANALYS~S KRM an~iyzed the fi~anclal lmpact of recan~cttor~ af earthquake damaged unit~ fram the per~pet~ve of ~e ori~~na! owner. The vbjec~ive oF th~ analy6is was tc~ d~te~mine tf the prop~~ty own~rs ca~~d recover th~ir prior Net C7p~rating l~aome {NO!) and ~till obtain an ad~uatr additicn~l financial return tv provide a flr~andai tnc:entive to rehuilci. In ~rder to da this, we e~rrated arigina~ Het O~~r~ti ng income by ~sing ~re-earthquake gros~ rent ~e~~ls prarrided by the Rer1t Cor~tro~ Department and deducaing ~t~mac€~ of prevlous operating exper~ses. Q~d aperating exp~sesw~re e~timated based on an average of 5~7 per sq~are ~at per m~nth. The new h~l from reca~stru~tfon ts determined from the new rer~: ar~a expense assumpc~ans aut~ined b~low. ~-4~rginai i~come r~presents t~e ~urplus generated by sub~ractEng ti~e a~~naJ hlDl ~tim~e~ before the earthquake from the new NC]i Tak~n~ the marg~nai income ancf dividing by ti~~ s~t p# r~c.v~strustian yields the ROI on new inv~stment capiral dur~ng the first full y~ar af o~eratio~s Deveia~ment Assumptions Mar~cet Rents - North of l~AClshire Market Rents - S~uth of 11V[lshire Vacancy ~~ - Market ~ni~ Vaca~c~r Rate , Inclusionary Unit~ Uperating Expense.s Prope~+~tjr Tax Fixed F,~cpenses Managemen# ~-Y .~4/sf 31.2~/s` 59E 7% 7.~59~ o~ value $1,rt0 p~r sq~are fc~at 5.2596 af r~rrt De~~gn an~ C~s~rurSi~n Cast Parking ~st (tudc undery Qve~head Ca~trs (no :.ity iees) Loa~ Feea ~~s.ao~t ~s,~00i5~a0~ t~c'sstir~g spaces only) 5g~ of hard cc~sts ~.5% ~•+~~ IES~CSatlwP+b~G4-S 77t~1( IfoLn, Regan & Mouchly, Inc POST-QUAKE APAR7MENT ANALYSIS Md~EL APARTMEti'T SGREE\'INC MODEL Last Run 04/08/94 10 27 ASSUMPTEONS PRpTpTYPE APARTMEM1T ho 5 25% Inclusartary Scenano LocaLOn North of Wifshire Low Inc @% o€ Cp Medan Inc 6096 Number o# Unrts 16 Mod Inc Q%of Co Median Inc 1009G ~at Area 1 Q800 Sq Ft Parkmg Lot Costs fPer Spacef 58,000 # of Unffs {Bns Inc ) 16 Rehudd Gosts (Per Sq F[ 1 558 00 Total Lot Size in An~ 0 25 Reqwred Parkmg Spaces 13 7ear povvn.~Budd New 100% a{ value County Media~ Inc {~ 009G1 448,30Q PRQJECT PROFILE Cak'd Res~deM~al E;ses No of Bon~ Total Size R~t Umts UnNS Units SqFt f994 S's Reni Levek ---- --- - ---- --- °----- Studp Units (low mc ) D 0 0 D S~ 9 Bedraom Unrts {low mc ) 1 0 y 600 558U 2 Bedroorn l;nrts (low ux } 1 0 1 850 5688 3 Bedroam UnKS pow mc } 0 0 Q Q S~ 4 Bedioorn Unds (low ux } 0 0 6 Q $U Stud~o Units {~ i~ ) 0 0 0 Q $0 1 Bedroom Un~rs Imod mc } t 0 1 b4p 584~ Arfwdable @ Mod Jnc = 5966 whr~ ~s ~earer than Marlaet 2 Bedroom Un~ (mod inc ) 1 0 1 BSU $1,747 3 Bedraom l:rnts (mod inc } 0 0 U a SO 4 Bedroorn Unrcs [mod inc ) ~ 0 0 D $0 Studro Unrts (mkt} 0 0 ~ D $U ~ Bedroom tJn~ts (mkt) S 0 8 928 bt,299 2 Bedraom L'nrts (mld) 4 0 4 1,148 $1,6fl7 3 Bedroorrk Unrts (mf~ D 0 0 D b~ 4 Bedroom Lnrts (rroid) 0 0 0 0 50 CALCI.LATEU70TAL5 16 p 16 14,41$ E20,080 PROTOTYPE 5 ULCI.iATEDAVERAGES 9sz S~,zss RESTORAT{ON SCENARIO Replacement TOTALBL:ILDIhG512E tia,9ys PERCENTINC~USIONARY 2596 DENSIN BONUS 1596 INCLUSIONAI2YMIJC Moderatelst Month~y Macellaneous Income (Per Und} y2 ~urauon oF Lease-Up 3 months Stabd¢ed vacancy Rate 4 0096 OPERAT1045 In(lat~on Rate 0 OD96 Years to lnFlate For StakHl¢ed incqme t year Property Tax Rate 1 25% OperaEing ~xpense Fixed Component ($1s(} i 10 Marragemeni F.xpense Vanable Comppnent aQ 5 25qo 0 85 Calnilated Operating Total Experues DEBT t]e6t Ser+nce Coverage Rata 1 20 Permanerrt Laan Term 30 Percnanerrt Loan IMeresE Rate (market- 8 08% Pemranent Loan Fee 1 50% DEVELDPMEn"T CQST Bq515 Land Value 5723,604 Plannmg & Predevelopmerrt o Common Area FacdiLes p Budd~ng ConstrucLan 865,232 Parking 104,000 Marketing 0 General & Admm~stratrve 48,452 Deprenable 8aas 1,o17,594 ~ ~~~5;~'i~~ii~~~~~i~511~~~~~~~~~'~i'~~~~'t~~~~~~~'~ti~~~~~~~t 1~~~~~~~~~~~~~ ~~~`~~1~~~~~~~ ~~~~~~~~~~ ~i~~~~~~~~~~~~ ~~~~~~t5'~1%~S~5~ti~1~t1~1 ~~:11~i~~~~~~~~~i~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~i~ii~ MEASURES QF RETURN Development Costs & Loan Fees 1,p4B,883 Sta6ihzed ~et Dperating Inmme INOI) 781,369 Pre-Quake VOI 7B,t73 ~'et NOI 103,197 ROI on Marginal Irnestment *~et ~OI;'tRe6wld Costs) 9 B% 04/08/94 14 Zb ?ile SMC 94~'SMAWWIODEL~PRO-SA WQ+ A T TA CHMEN T B CA:atty~muni\iaws1mhs\eqrec Santa Monica, Galifornia City Council Meeting 4-19-94 ORDINANCE NUMBER (City Council Series) AN EMERGENCY 4RDINANCE 4F THE CITY COUNCIL OF THE CITY OF SANTA MONYCA ENTiTLED "THE EARTHQL3AKE RECOVERY ACT," ESTABLISHING PR~CEDURES AND STANDARDS FOR REPAIR AND RECONSTRUCTION OF EARTHQUAIiE DAMAGED STRUCTURES THE PRESENCE OF AN EMERG~NCY THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES ORDAIN AS FOLLOWS: SECTIDN 1. Findinqs and Purpose. The City Council finds and declares: (ay Numeraus residential and commercial bui~.dinqs in the City af Santa Monica experienced substantia~ damage due to the January 17, 1994 Northridge earthquake and its aftershacks. Citywide, more than 2000 dwelling units and 135 non--residential structures were significantly damaged. As a resu~t, residents have been dispiaced from their homes and businesses, and owners face the task of rebuilding damaged structures. Without a streamlined permit process, families may be ieft homeless, neighborhoads wil~ continue to experience the negative effects of unrepaired buildings, and economic hardsh~ps will result from the delay in reconstruction. 1 (b) Many o~ the buildings which were damaqed are currently nonconfarming with respect to density, setbacks, height, floor area ratio~ or other code requirements. Under existing zaning ordinance provisions. if damage to a structuxe equals ar exceeds one-half of replacement costs immediate~y prior to such damage, the structure must conform to current zaning upan rebuilding. Adherence to these aoning provisions would significantly delay rebui~ding and recavery. {c) In additian, numerous damag~d buildings contain more housing units than allowed by current zoning. If current rebuilding pravisions were followed, there is the patential for a lass of housing units on these sites. (d) In order to preserve the City's hausing stock, t~ encourage rapid rebui].ding Qf residential and commercial structures, to maintai.n the City's existing residentia~ and coinmercial character, and to otherwa.~e promate the public welfare, it is necessary to adopt an expedited permit process for rebuilding, and reconstruction standards which encourage rebuilding. (e) This Ordinance creates a new permit, an Earthquake Recovery Permit, whieh wi~l be availab~e for the next two years. An Earthquake Recovery Permit wil]. authorize repair and reconstr~ction af eaxthquake damaged structures to their pre- earti~quake candition. The Ordinance also establishes an expedited review process, in which the level af re~iew depends upon the extent of damage to the structure and the averall size of the 2 project. This Ordinance sets praperty development standards, allowinq in-kind repair or reconstruction of Iegal nonconforming structures without complying with current zoning requirements. The Ordinance also d~lineates the building standards applicable t4 repair and reconstruction, which depend upon the magnitude of damage to the structure. The Ordihance establishes reoccupancy rights for displaced residenti~i tenants of buildinqs requiring repair or reconstructian. (f) In arder to pre5erve same level of affordability af residential rental units, and at the same time provide an incentive ta rebuild, this Ordinance allows residentia~ rental structures which are demolished and reconstructed to increase in size by fifteen percent (15~). An affordable housing abligation is also created ~or structures requiring a removal permit from the Rent Cantrol Board. The obligation may be satisfied by complying with any Rent Control Board imposad a~fardab~e housing obZigatio~, o~ by deed restricting twenty-five percent (25~~ of the units to be affordable to l.ow and moderate income households, with the remainder of the units uncontrolled at market rents. {g) FinaZly, this Ordinance repeals the majority of the emergency ordinances adopted since the Northridge earthquake, and incorporates key provisions of those ordinances which axe intended to remain in effect. SECTION 2. Definitions. Wo~ds used zn this Ordinance shall be defined as provided in this Section. Words not specifically 3 def~ned in this Ordinance sha~l ~e defined as set forth in the 2aning ardinance. (a) Aftordab~e Housinq IInit. A rental unit meeting the requirements of Section 5 of this ordinance which is affordable to a household with low or moderate incQme. (b) Chanqe of Use. For residential structures, a change to non-residential use or a change fram apartments to condominiums; for nan-residential structures, any use with a different parking requirement. (c) Cvst of Repair. The estimated cost to repair ar reconstruct to be determined by the City based upon infarmation provided pursuant to Sectian 6(a) af this Ordinance. Cost af repair shall include the cost af including any additionai square foatage allawed as a size incentzve pursuant ta this ordinance. (dj Current Technical Codes. The provisions af Santa Monica Municipal Code Chapter 8.04, and any other construction related technical codes adopted by the City, in effect at the time of issuance af the building permit. (e) Earthquake Damaqea Structures. Structures damaged by the Northridge earthquake or its aftershocks far which the cost of repair exceeds $1.Od per square foat of building area. (f) Earthquake RecQVery Pe~mit. A permit to repair, ar remove and reconstruct, earthq~ake damaged struct~res or partions of earthquake damaged structures, issued pursuant to this ordinance. 4 (g) In-kind. In-kind means that, excluding any 5ize Incentive allowed by this ordinance, and except as nec~ssary to comply with required Current Technical Code provisions, the square footage of the proposed stzucture does not exceed the amaunt which existed in the building pre-earthquake; the number of dwelling units is no greater than the number existing pre-earthquake (although the number of b~drooms or configurations of units ~ay vary); the height o€ the structure is no greater than that which existed pre-earthquake; the setbacks are no less than those which existed pre-earthquake; the number af parking spaces pr~vided is no less than the parking provided pre-earthquaka (unless the structure ~s Iocated in the Dawntown Parking Assessment District); ~ot ca~erage is no greater than that which existed pre-earthquake; landscaping, trash and recyc~ing enclosures are substantially simi~ar ta thase existing pre-earthquake; and that th~re is na change in use except as specificalZy allowed by this Ordinance. (h) Landmark eZiaible. A structure meeting one or more of the fallowing criteria: (1) Listed on the Natianal Register af Historic Places; {2) Listed on the Caiifornia Register of Hiatorical Resources; (3) Designated as a City Landmark; (4) Identified in the City of Santa Monica Historic Resources Inventary and evaluated as: {a) eligible for the Natianal Register of Historic Places as an individual structure or as part af a district or (b) eligible for designation as a City Landmark. 5 {i) New Construction. F~r nan-residential structures, any construction which is not in-kind; for residential structures, any construction which, excluding any Size Incentive allowed by this ordinance, is not in-kind. {j) Pre-earthquake. The conditzons existing immediately prior to the January 17, 1994 Northridge eaxthquake. (k) Reconstruction. The demolition of an earthquake damaged structure and construction of an in-kind replacement structure. (1) Repair. The in-kind restaratian o€ an earthquake damaged structure in which tata~ cost of repair is less than fifty percent (50~) af the replacement va~ue of the structure, or in which 1~55 than fifty percent (54~) of the exterior walls are removed to the foundatian. {m) Re~lacement Value. The estimated cost of replacing th~ earthquake damaged structure, to be determined by the City using the most current Building Valuation Tabl~ p~blished by the In~ernational Conference af Building officials. (n) Residentzal Rental Pro~ect. A parcel containing two ar more rental dwelling units ~ot held in condominium o~ cooperative ownership. (o) Siqnifica~t Desiqn Chanqe. The architectural style of a building, building faotprint, or the majarity of the exterio~ building materials are substantia~ly different from that whzch existed pre-earthquake. {p) Size Incentive. An incentive allowing a totaZ square footage increase of up to fifteen percent (15~) over pre-earthquake 6 square f~otage on the parcel, a tatal flaar area ratia (FAR) increase o~ up to f~fteen percent (15~) over pre-earthquake FAR on the parcel, a total height increase of five feet per structure on the parcel~ but not allowing any increase in the number af dwelling units. (q) ~enant. Any tenant, subtenant, lessee, sublessee, or any oth~r person occupying a rental hausing unit pursuant to a rental hausing agreement. SECTION 3. Applicability. This Ordinance authorizes the issuance of an Earthquake Recovery Permit only for InRkind repair or reconstruction of earthquake damaged structures. Any application fQr repair, demolitian, or replace~ent af earthquake damaged structures involving ather than in-kind repair or reconstruction shall be considered an applicatian for New Construction. An applicatian for an Earthquake Recovery Permit shall be processed and evaluated pursuant to the provisions of thi5 Ordinance. The provisions of this Ordinance shall not apply to applications far New Construction. An application for New Construction shall be processed and evaluated under app~icable Municipal Code provisions, including Subchapter 9.04.18 of the Zoning Ordinance concerning the repair and alteration of nonconforming building and uses. 7 SECTION 4. Earthquake Recoverv Permit Development Standards and Use Restrictions. An Earthquake Recovery Permit authorizes ~n- kind repaix or reconstruction, ~ubject to the foll~wing provisions: (a~ Nonconformina Suildinqs and Structures. Any legal nonconforming building ar structure otherwise quaiifyinq for an Earthquak~ Reco~ery Permit may be recanstructed ta its previous noncontarming status. Any residential unit created without a building permit, and registered with the Santa Monica Rent Cantral Board (a "baotleg unit"j, may be repaired provided the unit meets minimum habitabi~ity standards. Residential Rental Projects which are reconstructed pursuant to this Ordinance and which contain one or more bootleg units may count those units in the total number af units which may be reconstructed provid~d all reconstructed units meet the requirements of the Current Technical Codes. (b) Chanqe in Use. No change in use shall be allowed for a residential structure. Far a non-residential structure, a nonconforming use may be resumed after repair or reconstruetion, or may be replaced with a conforming use; and a canforming use may be changed to another confarmir~g use so long as the parking requirement for the new use does not exceed the parking requirement for the pre--earthquake use. Notwithstanding the above, nonconforming o~fice use shall not be replaced with nonconfozming retail use, and nonconforming retail use shall not be replaced with nonconforming office use. (c) Size Incentive. A Residential Renta~ Project qualifying for an Earthquake Recovery Permit is entitled to a Size Incentive. S A Size Incentive allows a total square foatage increase of up to fifteen percent (15~) over pre~earthquake square foatage an the parcei, a total floor area ratio (FAR) increase vf up to fifteen percent {15$) over pre-earthquake FAR on the parcel, and a tatal height increase af five (5) feet per structure an the parcel, but daes not allow any increas~ in the number of bedrooms. A reconstructed building qualifying for a Size Incentive may have lot ca~rerage or setbacks which vary from those of the pre-earthquake structure, but no new nonconformity in lot cove~-age or setbacks may be created, or any existing nonconformity in ].ot caverage or setbacks be increased. A si~e incentive may not be used tn construct an additionai structure or structures on the parcel which did nat exist pre-earthquake. SECTION 5. Affordable Housinq Obliqation. The provisiar~s of the City's Inclusionary Hausing Prngzam, Chapter 9.28 of the Municipal Code, shall not appiy to any project obtaining an Earthquake Recov~ry Permit, except as specifically incargorated in this Section. An affardab~e housing abligation shall apply to any Residential Rental Pro~ect obtaining an Earthquake R~covery Permit which also requires a removal permit from the Santa Monica Rent C~ntrol Board. The ~ollawing affordable hausing obligation sh~ll apply: (a} If the project has an affordable housing abligatinn imposed by the Rent Control Board, such obligatian shall satisfy the requirements of this Section. 9 (b) If no affordable housing o~ligation is imposed by the Rent Control Board, not less than twenty-five percent (25$) of the total number of dwellinq units in the Residential Rental Praject sha11 be affordable to law and maderate income households. Law and moderate income levels shall be defined as set forth in Santa Monica Municipal Code Section 9.28.020. (c) In determining the number of affordable units required, the fol~awing chart shall he utilized: No. of Units Reconstructed Low Income Maderate Income 2 0 1 3 0 1 4 0 1 5 0 1 6 1 1 7 1 1 $ 1 1 9 1 1 1o i 2 11 1 2 12 1 2 ~3 1 2 14 2 2 15 2 2 16 2 2 i~ z z ia ~ ~ io 19 2 3 2~ 2 3 For mare than twenty (20) units, the number of affordable units required shall equal twenty-five percent (25g) of the number of units built; any decimal fraction of 0.5 ar mare rounded up to the nearest Whole number, and any decimal fraction of less than 0.5 rounded down to the nearest whole n»mher. The first affordable unit required nZay be affordable to lo~,~- ar maderate income hou5eholds, and alt~znating thereafter. {d) Affordable units may have reduced size or amenities as long as there are no significant identifiable differences between thE affordable units and mark~t rate units visible from the exterior of the dwe~ling e~nits, and each of the affordable units satisfy the following minimum total floar area: 4 be3roam 50p square f eet 1 bedroam 600 square feet 2 bedroams 850 square feet 3 bedrooms 1080 square feet 4 bedrooms l~Qfl square feet. (e) The mix of bedraam sizes of affordable units shall be substantially similar to the mix of bedroom sizes af the market rate units in the project. (f) Affordable units shall also cornply with the requirements for inclusionary units set forth in Santa Monica MunicipaZ Code 5ections 9.28.050{c), 9.28.100, 9.28.110, 9.28.130, and 9.28.140. 11 SECTION 6. Earthauake Recove~y Permit Application. To request an Earthquake Recovery Permit, the applicant must submit a camplete applicatian on a form provided by ~he Planning and Zoning Divisian in addition ta any other material, reparts, dimensioned plans, or other information required to take action an the application. Each applicatian shall also include: (a) Two estimates of the cost of repair or reconstruction from properly lic~nsed contractors. The estimates must contain sufficient detail tv ascertain the scope of the proposed work and include the contractor~s profit, ~verhead and insurance cost. {b) For structures that have been posted with either a no entry notice {Red-tagged} or limited entry notice (Yellow-tagged), a written structural analysis of the structure prepared by a licansed engineer in accordance with the standards providad by the Building and Safety Division. (c) Two sources of documentation af the pre-earthquake condition of the property or structure sufficient to enab~e the City to determina whether the project involves in-kind repair or recnnstruction. Documentation may ~nclude: approved building permits; approved construction drawings; surveys from licensed surveyars; coun~y assessor informatian; certified property appraisals; Sanbarn maps; reports or drawings prepared by an insurance company to suppart damage claims; photographs; City plann~ng xecards; or any other varifiabla information. 12 SECTION 7. Review brocess. Each application for an Earthquake Recovery Permit shall require plan check approval as the final review prior to issuance af the Earthquake Recovery Pez-mit. In addition~ th~ fallowing pracedures shall apply: (a) Where the cost of repair is less than fi.fty percent (50~) of the replacement value of the structure, ar where less than fifty percent (50~) of the exterior walls ara remaved ta tha faundation (regardless Qf cast af repair), the follawing review or reviews will be required: (1) If there is not a significant design change from the original design, plan check only. (2) If the project includes a Size Incentive, Administrative Approval ("AA"j is required. (3) If there is a significant design change, Architectural Review Board ("ARB") review is required. Single family hames arQ not subject to P,RB review pursuant to this subsectiqn unless the structure is also landmark eligible. If an application requires bath AA and ARB review, AA review shall precede ARB review. {b) where the cost of repair equals ar exceeds fifty percent (54~) of the replacement value of the structure, and fifty pereent (50$) or more af the exterior walls are removed to the foundation, but the development on the parcel is be~ow the develapment review thrashold for the district in which it is ~ocated, ARB review shall be required. If the project incZezdes a Si~e Ince~tive, A~ Reviaw shall also be required prior to ARB review. 13 (cy Where the cast of repair equals or exceeds fifty percent (50~) of the replacement value and fifty percent (50$) or more of the exterior wa~ls are removed to the foundation, and the development on the parcel is above the deve~apment review threshold for the district in which it is located, Planning Commission review is required pr~ar to plan check. ARB review shaZl not be required far any project requiring Planning Commission review. (d) Hearinus and Notice. Review la~ the ARB or Planning Comn~issian shaZl require a public hearing, to be noticed and conducted substantially in compliance with the provisions of Section 9.32.180 of the Municipal Code for ARB hearings, and Part 9.04.20.22 of the ZOning Ordinance far Planning Com~nission haarings. For Planr~ing Cammission hearings, notice shali be given to all owners and residential and commercial tanants of property within a radius of 30D feet from the exteriar boundaries of the property involved in the application. (e) Issuance af Build~nq Permit. A building permit shall be issued anly after the application has received all appravals required under this Section, and after approval is granted fram the California Coastal Commission if required. A project may appl.y for an Earthquake Reco~ery Permit before obtaining a removal perinit or determinatian that a removal permit is not required from the Rent Contro~. Board. A bu~.lding perznit shall not i.ssue, hawever, until such remaval p~rmit or determination is granted. (f) Demalition Permit. Projects receiving a Earthquake Recovery Permit pursuant to this Ordinance shall not 7require a 14 separate demo~ition permit. Demolition may occur at any time after the building permit is granted, and while the building permit is still va~id. Demolition ather than pursuant to an Earthquake Recovery Permit shall require a demalition permit pursuant to applicable M~nicipal Code provisions unless the demolition was ordered by the Gity's Nuisance Abatement Baard. (g) Annea~s. Action of the ARB and Planning Commission shall be appealable pursuant to the provisions of Section 9.32.160 of the Municipal Code and Part 9.04.24 of the Zoning Ordinance~ except that the appeal af any ruling of the ARB or Planning Comrnission must be made within five (5) days of the date that such ruling is made. SECTION 8. Standards for Review. The ~'ollawing standards sha~l govern the review of an application for an Earthquake Recavery Pern-it: (ay AA Review. AA approval shall be granted if the project plans reflect in-kind repair or recanstruction, and any additional square footage, height ar FAR complies with the Size Incentive requirements of this Ordinance. (b} ARB Review. The ARB, or Planning Commission on appeal, shall grant approvaZ if both of the following findings can be made: (1) The structure's architectural design is substantially similar to the pre-earthquake design; or, if a significant design change is invalved, the structure's 15 architeatural design is compatible with the qenera~ area in which it is lacated. (2) I~ the structure is landmark eligible, the repair will not unduly campromise the architectural or historical inteqrity of the structure or patential district; or, if recanstructian is invalved, based upon an estimate from a professional experienced in rehabilitation of historic structures, it is nat economically feasible to repair the structure. {c) P~anninq Commissian R~view. The Planning Cammission, or City Council on appeal, shall grant approval if both of the fallowing findings can be made: (1) The structure's architectural design is substantially si~ilar to the pre-earthquake design; or, if a sign~ficant d~sign change is invalved, the structure's architectural design is compatible with the genera~ area in which it is located, [2) If tha structure is landmark eligible, the repair will not unduly compramise the architectural ar historical integrity of the str~cture or potential district; or, if reconstruction is invalved, based upon an estimate from a professionaZ experienced in rehabi~itation of histaric structures, it is not economically feasible to repair the structure. (d) Plan Check. Plan check review wi1~ be 3imited to the issue of whether the project complies with the requiremants of this Ordinance. 16 (e) Conditidns of A~~roval. In granting approval of an Earthquake Recovery Permit, the ARB, Planning Commissian, or City Council on appeal, may impase anly such conditions as may be deemed necessary to bring tha project into compliance with this ordinance, or as necessary to enable the required findings for approval to be made. SECTIaN 9. Duratian of Permit. The rights granted by an Earthquake Recavery Permit shall expire if a building permit is not issued within two (2) years of the effective date of this ordinance, or if the bui~ding per~it expires. No extensions of an Earthquake Recovery Permit shall be granted. After expiration af an Earthquake Recovery Permit, any subsequent application shall be considered an application for Ne~a CQnstruction. SECTION I0. Composi.tion of ARB. For purpases of ARB review of an applicatian for an Earthquake Recovery Permit involving a landmark e~igible structuze, structure af inerit, structure within a historic di.strict, or structure identified on the City Hi,staric Resources In~entoxy, Volumes 1, 2, and 3 as of January 17, 1994, twa (2) members of the Landmarks Commissian, appainted by that bady, shall serve as additional voting members of the Architectural Review Board. Five (5) affir~ative votes shall be required far approval. 17 SECTION 11. Buildinq Standard Comnliance. The following buildinq standards govern any work performed pursuant ta an Earthquake Recovery Permit: (a) When the cost of repair does not exceed ten percent (10~} af the replacement ~alue of the structure, only the damaged portion af the structure may be restored to the pre-earthquake Candition without complying with Current Technical Codes. Notwithstanding the above, when the repair includes repair to suspended ceiling systems, the repair must camply with Current Technical Codes. (b) When the cast of repair is greater than ten percent (10~} but less than fifty percent (50$} of the replacement value of the structure, the damaged ~lements, as well as the essential ties and support elements associated with the damaged elements, shall be brought into conformance with the structural xequirements of the Current Technical Codas, (c) When the cost of repair exceeds fifty percent (50$) of the replacement value of the structure, the entire structure shaZl be brought into canfarmance w~th the Current Technical Cades. (d) Landmark eligible buildings shall comply with subsections (a) through (c) above; hawever, an owner may request a modification of the above standards which shall be gxanted so long as the requested modificatian is consistent with Part 8, Title 24, California Code of Regulations, the State o~ Califarnia Historical Building Code. {e) Notwithstanding (a) -(c) above, the grovisions of Ordinance Number 1729(CCS) concerning repair and recanstruction 18 criteria far unreinfarced chimneys and walls over 42 inches in height shall apply to any project obtaining an Earthquake Recovery Permit. (f) The standards of this Section shall constitute minimum standards. Nothing in this Section 11 shall be construed to prohibit an awner from repairing or reconstructing a structure ta a higher standard than set forth in this Section. SECTION 12. Compliance With Other Laws. Except as otherwise specificaily provided in this Ordinance, projects obtaining an Earthquake Recavery Permit shall nat be requ~red to comply with the following provisions of the Santa Monica Municipal Code: (a) Chapter 7.10 concerning Urban Runoff Pollutian; (b~ Chapter 9.Q4 concerning Zoning Regulations; (c) Chapter 9.28 concerning Inciusionary Housing; (d) Chapter 9.32 concerning Architectural Review; (e) Chapter 9.36 concerning Landmarks and Histaric Districts; and (f~ Chapter 9.40 concerninq the Third Street Neighborhoad Historic Di,strict Standards. Except as specifacally exempted in this 5ection, projects obtaining an Earthquake Recovery Permit sk~a~l comply with the Municipal Code and alI other applicable ~aws and regulations. For purposes vf Chapter 9,52, the Santa Moni.Ga Sign Qrdinance~ nanconforming signs remaved during work performed pursuant to an I9 Earthquake Reco~ery Permit shail not be replaced, or sha~l be modified to canf~rm to the requirements of the Sign Ordinance. SECTION 13. Riqht of Displaced Tenant to Reoccupv Residential Housin~ Unit. A tenant displaced from a residential housing unit in an earthquake damaged structure shall be entitled to reoccupy the unit in accordance with the following provisions: (a) Any owner who reconstructs a residential housing unit pursuant to an Earthquake Recovery Permit shall first offer the reconstructed unit for rent or lease to any tenant who has been displaced from the unit due ta the need to undertake the rec~nstruction. This requirement shall apply only if the tenant within thirty (30} days of the displacement or the adoption af this Ordinance~ whichever is later, has provided the owner with written notice of his or her desire to consider an affer ta renew the tenancy and has furnished the owner with an address to which that offer is to be directed. That tenant may advise the owner at any time during the disp~ace~ent period of a change of address to which an affer is to be directed. (b) Within fifteen {15) days after final City sign-off on the bui~ding permit authorizing the recons~ruc~ion, the owner shall submit a goad faith affer to renew a rental agreement or lease on terms permitted by law to any displaced tenant wh~ has complied with the requizemEnts of sulzdivision (a) of this Section. The owner shall aZso inform the tenant of the expected date that the unit will be available. 20 (c) This offer shall be deposzted in the United States mail, by reqistered or certified first class mail with postage prepaid, addressed to the displaced tenant at the address furnished to the owner as pravided in this Section and sha1~ describe the terms af the affer. The displaced tenant shall have thirty (30) days from the deposit of the offer in the mail to accept the offer by personal delivery af that aeceptance or by deposit of the acceptance in the United States mail by registered or certified first class mail with postage prepaid. (d) The City shall make availab~e official forms to tenants entitled "Notice of Desire to Renew Tenancy" and "Notice of Change of Address" which may be utilized by tenants to meet the requisite notice requirements of this Section. (e~ Within five (5) days after final City siqn-off on the building permit autharizing the repair of an earthquake damaged structure, any Qwner wha was required to recover possession of a residential housing unit due to the need to undertake the repairs shall natzfy the displaced tenant that the unit is ready for reoccupancy. Priar to displacement ar wi~hin thirty {30) daya after adoption of this ordinance, whichever is later, the owner shall obtain an address to which the tenant notification is to be directed. Any tenant who has been displaced from such a unit for a periad exceading fourteen (14) days shail have fourteen (i4) days from the receipt of the owner's natice to reoccupy the unit and recommence rental payments in the amount established by the R~nt Control Board. An owner shall be relieved of the obligations 21 specified in this subsection an~y if the tanant has previously terminated his ar her tenancy in the unit in a manner authorized by law. (f) A copy o€ any natice required to }~e p~rovided to an owner or a displaced tenant under this Section shall be pro~ided to the Santa Manica Rent Control Baard within two {2f business days after it is provided to the owner or dispiaced tenant. (g} No owner or agent of the owner ~hall rent a rasidential housing unit in an earthquake damaged structure to a new tenant unless the owner has complied with the terms of this Sectian or is otherwise excused from complying with this Section. (h) Ar~y displaced tenant may prosecute a civil actian to enfarce this Section. The relief available to the tenant in such an action shall include money damages, equitable relie€, and reasonahle attarneys' fees. (i) The right of a displaced tenant to reo~cupy a residential housing unit as established in this Sect~on is in addition ta any right to r~occupancy that may otherraise be authorized by law or c~ntract. (j} Notwithstanding any prov~sion of Section 5 of this Drdinance to the contrary, a displaced tenant may have priority for the rentaZ of affordable housing units. This priarity will be established by administrative regulation to be adopted by the City's HQUSing and Redevelopmen~ Division. 22 SECTION ~4. Construction Hours and Canstruction Rate Proqram. CQnstructian hours for all construction, ~hether gursuant ta an Earthquake Recovery Permit or otherwise, shall be 7 a.m. to 7 p.m. Monday through Friday, and 9 a.m. through 6 p.m. on Saturday. The provisions of the North of Wilshire Construction Rate Program shall not apply. The provisions of this Section 14 shall no longer be effective two years from the effective date of this Ordinance. SECTION I5. Californ~a Enviranmental Quality Act ("CEQA") Exemption. Natwithstanding existing City CEQA Guidelines, pursuant ta Sectivn 15269 of the State CEQA Guidelines and the State of Emergency declared by the Governor of Califarnia, pxojects undertaken pursuant ta an Earthquake Recavery Permit shall be considered categorically exempt fram the requirements of CEQA. SECTION 16. Fee Waivers. Th~ City Council authorizes the City Manager or his or her designee to waive payment of any permit processing fees o~ such other applicable fees as may otherwise be necessary for the repair and reconstruction of earthquake damaged buildings or structures~ if the City Manager in his ar her sale discretion deems such waiver apprflpriate to facilitate the speedy repair or rec~nstructian of any building or other structure damaged by the January ~7, 199~ earthquake or its aftershvcks. SECTI~N 17. Ordinance Numbers 1720(CCS), 1722(CCS), 1725~CCS), and 1730(CCS} are hereby repealed. 23 SECTION 18. Any prov~sian or provisions of the Santa Monica Municipal Code or appendices thereta, incansistent with the provisions of this Ordinance, to the extent af such incansistencies and no further, are hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance. SECTION 19. This Ordinance is declared ta be an urgency measure adopted pursuant ta the provisions of Section 615 of the Santa Manica City Charter. It is necessary for preserving the public health, safety, or welfare as set farth in the Findings and Purpose section of this Ordinance. SECTI~N 2Q. If any section, subsection, sentence, clause, or phrase of this Ordinance is €or any reason held to be invalid ar unconstitutianal by a decision of any court af any competent jurisdiction, such decision sha11 not affect the validity of a~l remaining portions of this Ordinance. The City Council hereby declares that it would not have passed this Ordinance if any portian, section, subsection, sentence, clause, or phrase would subsequently be declared invalid or u~constitutional. 24 SECTION 21. The Mayor shall sign and the City C2erk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Qrdinance shall ~e effective upon its adoption. APPROVED AS TO FORM: `~ t ~.,,, ~~ ~ ~~°_ [ _S `v ~. ~ ~. vu~~ ~ ''1 C'~ ~ :~.~ MAR~IA ~TONES{~~IOUTRIE ' T ~ City Attorney 25