SR-8A (55)
g--A
F \HOUSING\SHARE\WPFILES\STAFFRPT\INCLlNT2 WPD
Council Meeting December 16, 1997
DEe 1 6 fQ97
Santa MOnica, California ....
TO Mayor and Members of the City Council
FROM City Staff
SUBJECT Ordinance for Introduction and First Reading Amending the City's
Incluslonary Program (Ordinance 1615) and a Recommendation to Adopt a
Resolution Establishing an 1 ncluslonary Unit Base Price for Purposes of
Calculating an In Lieu Fee Option for Moderate Income Units
INTRODUCTION
ThiS report recommends that City Council adopt an Interim ordinance amending Ordinance
1615 that would allow newly constructed multIfamily residential proJects to satisfy theIr
Incluslonary hOUSing obligation for both low- and moderate-Income Units by payment of an
In lieu fee ThiS report also recommends that the City Council adopt the attached reso-
lutlon establishing the Incluslonary base price for purposes of calculatIng the In lieu fee
optIon for moderate Income units
BACKGROUND
On November 6, 1990 the voters of the City of Santa MOnica approved ProposItion R,
adding Section 630 to the City Charter Proposition R proVides that the City Council at all
times reqUire that not less than 30% of all multIfamily reSidential hOUSing newly constructed
In the City, on an annual baSIS. be permanently affordable to and occupied by low and
moderate Income households It further reqUires that at least 50% of those Units be
affordable to "low Income households" defined as not exceeding 60% of median Income,
-t
I
i~A
DEe t 6 1997
and the remainder be affordable to "moderate-Income" households defined as not
exceeding 100% of median Income
On March 4, 1992, Ordinance 1615 was adopted It reqUires the provIsIon of on site
mcluslonary Units, or payment of an In lieu fee In limited circumstances, but for the required
low-income units only
On Apnl 15, 1997, the City Council approved In concept the 1998-2003 Draft Housmg
Element and directed staff to prepare an amended Incluslonary HOUSing Ordinance
Program 2 a ofthe City's Draft HOUSing Element requires review and revISion ofthe City's
Incluslonary HOUSing Ordmance Specifically, the HOUSing Element states "Study modifi-
cations of the City's Incluslonary Housmg Program (Ordinance 1615) which would help
support new hOUSing production In a way that balances this productIon wIth maintenance
and conservation of eXisting hOUSing stock, while complYIng with Proposition R "
On July 8,1997, City Council approved the selection of Hamilton Rabinovitz and Alschuler
(HR&A) to prepare analyses relating to modifications of the City's Incluslonary HOUSing
Ordmance HR&A's scope of work was structured to occur m three phases, lastIng from
mid-July through February 1998 These phases Include 1) research and analysIs pnor to
articulation of preliminary concepts, 2) review and presentation of preliminary concepts
through public workshops, study sessions and public hearings, and 3) specific Imple-
mentation program options, which will be reViewed with deCISion makers Phases one and
two of the Incluslonary reVISion process have been completed HR&A IS now formulating
2
specific options, all of which will Include fee and performance alternatives that will enable
the City to fulfill the PropositIOn R reqUirements
On November 11, 1997. the CIty Council dIrected staff to prepare an interim ordinance that
would revise the In lieu fee component of Ordinance 1615 In response to concerns that
Ordinance 1615 may be in conflict With specific provisions of the Costa Hawkins Rental
Housmg Act of 1995 ResolVing this apparent confhct requires 1) making the eXisting
option to pay the In lieu fee for required lOW-income umts less restrictive, and 2)
establishing a new fee for the required moderate-Income Units.
DISCUSSION
This Interim ordinance would allow payment of an In lieu fee Instead of requiring
developers of new multifamIly reSIdentIal developments to proVide any Incluslonary unIts
on site A base In heu fee was set at $51,000 for the lOW-income umt In 1992 The fee IS
adJusted by the Consumer Price Index (CPI) at the time an In heu fee payment IS made,
per the terms of Ordinance 1615 Currently, the In heu fee for a lOW-Income Incluslonary
unit IS $56.055
There IS no base In heu fee for a moderate-Income Unit In Ordinance 1615, because aU
reqUired moderate-Income umts must be provided on site As part of Its more
comprehensive review of the City's Incluslonary HOUSing Program, HR&A has developed
several alternative approaches to calcuiatmg in lieu fees, which can be applied to an
Interim fee for the moderate-Income Units
3
The Moderate-Income In Lieu Fee Amount
There are at least three approaches the CIty Council could consIder In setting an mterlm
In lieu fee for the moderate-Income Units
The first IS to use the same fee now In effect for the low-Income unit, or $56,055
II The second IS a fee based on the actual cost required for a non-profit developer to
provide a moderate-Income Unit, taking Into account the development cost that can
be supported by the maximum affordable moderate-Income rent
III The third approach IS a fee based entirely on the cost of developing a
moderate-Income unit Without regard to the portion of the total development cost
that can be supported by maximum affordable moderate-Income rent
Using the Existing Low~/ncome Fee. The City Council could decide that, as an interim
measure for a penod of about SIX months until the Ordinance 1615 reVISIon project IS
completed, the in-lieu fee for moderate-Income units should be equal to the fee that IS now
charged for a lOW-income mcluslonary Unit Although thiS may appear to be the simplest
approach, the fee amount would bear no relatIonshIp to the actual cost of developIng a
moderate-Income Unit
FollOWing the adoption of Ordinance 1615, the City Council adopted Resolution 8414
(CCS) In June 1992. setting the In-lieu fee at $51 ,000 ThIS fee has been Increased since
then by the monthly change In the CPI, and now stands at $56,055 The onglnal fee
amount was based on the average amount of City subSidy spent to develop four new
4
ATTACHMENT B
ZOl'i1NG TEXT At"IENDl\lENTS
PEDESTRIAN-ORIENTED DESIGN
add language in [tallcS"
9.04 10.02.440
Pedestrian-Oriented Design.
Each structure required by this Code to be designed wah pedestnan-orientatlOn shall
Incorporate the followmg design elements:
(a) Highly anzculatedfacades at the groundfloor street frontage.
(b) A mimmum offifty-percent of the facade 10 a heIght of eight (8) feet shall be
visually transparent mto the bUlldmg or prOVide a nummum depth of three (3)feetfor WIndOW
merchandise display. No merchandise storage shall be allowed In the storefront windows.
(c) Signage oriented and scaled to the pedesman.
(d) Extenor lzghllng which proVldesfor a secure mghmme pedestrian enVironment
by reinforcing entrances, publlc sidewalks and open areas with a safe level ofllluminatlOn
which aVOids off-sue glare.
(e) Stnlcrures that contam commercwl or other pedestrian-onented uses shall have
a mmimum of one public entrance at the ground floor address frontage and shall minimize the
n.umber and the WIdth of driveways from the street frontage. Only intenor and extenor security
grates or gnlles that are recessed and completely concealed when retracted are permuted.
(/) ReSIdentlal uses at the ground floor street frontage shall mcorporate plamed
areas, porches, from statrs and/or other elements that contribute to a pedestnan environment.
Pedesman-onented design elements may also include street furnuure or other seating suifaces
on pnvate property and deSign amentues scaled to the pedestnan such as awmngs, paseos,
arcades, colonnades, plazas, publ1c or prIvate art and altemanve pavmg matenals In areas of
pedestrian access.
In order to encourage quallly, creanvlty and companbilllY, the Architectural Review
Board may allow exceptlOnsfrom the reqUirements of (a) through (f) above if all of the
followmgfindmgs offacl can be made man affinnatlve manner:
(a) That the smct appl1catlOn of the prOViswns of thiS Chapter would result In
pracllcal difficultIes or unnecessary hardships InConsistent with the general purpose and mtent
of thIS Chapter or that there are excepnonal circumstances or condlllons applicable to the
proposed development that do not apply generally to other developments covered by thiS
Chapter.
(b) That the granting of an excepllon would not adversely affect surrounding
propemes or be detrlmenlal to the dmnct's pedestrian-oriented enVironment.
-'!~
--033
of that cost that can be amortized by the maximum affordable moderate-Income rent, but
also recognizing that there are no other non-City sources offunds avaIlable at this Income
level The cost for a non-profit to develop a moderate-Income Unit can vary significantly
due, In particular, to land cost and the size ofthe umts AnalysIs prepared by HR&A (see
Attachment A) mdlcates that the per-unit total development cost could range from about
$182,000 (I e , two-bedroom, one-bath Units on less expensive R2 land In the central and
eastern sections of the City) to about $273,000 (I e , three-bedroom, two-bath Units on
more expensIve R2 land In the northern part of the City) The maximum affordable rent for
a moderate-Income household (I e., $770 per month for a two-bedroom Unit and $1,283
for a three-bedroom unit), after deducting vanous operatmg costs and accountmg for a
reasonable debt coverage ratio, can support a construction loan that accounts for between
half {three-bedroom unIt In a hIgh cost area) and two-thIrds (two-bedroom umt In a lower-
cost area) of the total development cost Depending upon the blend of Unit size and land
cost assumptions, HR&A estimates that the remalnmg amount--the development cost gap
to be filled by an In lieu fee--could range from $68,659 to $147,511 per umt (see
Attachment A), or a weighted average of $85,000 per Unit, as shown In Attachment A
The weighted average assumes that non-profit developers would, on average, bUild three
two-bedroom Units for every three-bedroom Unit, two lower-cost two-bedroom Units for
every higher-cost two-bedroom Unit, but no higher cost three-bedroom Units Once agam,
thiS amount IS higher than the current fee for a low-income Unit, because development of
a moderate-Income Unit affordable to a household at 100% of the median family Income
cannot qualify for any of the non-City funding that IS available for a low-income unit
6
A Fee Based on the Total Cost of Developing a Moderate-Income Unit. The third
approach IS similar to the first, In that It IS based on the total cost of developing a moderate-
Income umt, but would not consider the portIon of that cost that can be amortized by maxI-
mum affordable rent The In lieu fee would therefore be equal to the total development
cost per Unit, as noted above (I e , from $182,000 to $273,000) In addItion to resulting In
a substantIally hIgher fee than eIther the fIrst or second approach, thIS thIrd optIon would
be entirely inconsistent wIth past City practice by overstating the amount actually needed
to deliver an affordable unit
The T otall n Lieu Fee
For the above reasons, City staff recommends that the In lieu fee for a moderate Income
mcluslonary Unit be set inItially at $85,000 The eXisting on-sIte mc1uslonary Unit table In
Section 9 28 060 of Ordmance 1615 can be used to determine the total Incluslonary In lieu
fee requirement for a project Attachment B shows 1) the lnc1uslonary requirement of a
project, and 2) application of the Interim In lieu fee optIon which would Include a total fee
for both the newly developed moderate Income umt In lieu fee ($85,000) and the eXIsting
[ow Income Unit In lieu fee ($56,055), by specific project Size For illustration purposes, the
follOWing table shows the mcluslonary requirement and total fees that flve- through mne-
Unit multifamIly reSIdentIal projects, the most tYPIcal sIze of new apartment and
condomInium projects, would pay under the Interim ordInance
7
Table 1
Calculation of Proposed In Lieu Fees for Five- through Nine-Unit Multifamily Projects
Low In Lieu Fee Moderate In Lieu Fee
Number Income For Income For Total
of Units Units Low Unit Units Moderate Unit Fee
BUilt Required Requirement Required Requirement ReqUired
5 1 $ 56,055 0 $ 0 $ 56,055
6 1 $ 56,055 1 $ 85,000 $ 141,055
7 1 $ 56,055 1 $ 85,000 $ 141,055
8 2 $ 112,110 1 $ 85,000 $ 197,11 0
9 2 $ 112,110 1 $ 85,000 $ 197,110
- - > - - - ,. - . . -. ________ . .
Projects Subject to the Intenm Ordinance
It IS proposed that the In lieu fee option, avaIlable on an Intenm basIs, apply to any project
whIch has an mcluslonary obligatIon under Ordmance 1615 and has not receIved Admlnl-
stratlve Approval or Planning Commission approval as of the effectIve date of the Intenm
ordinance, and obtains a BUilding Permit whIle thiS Intenm ordinance IS stili In effect
These amendments are expected to be In place for about SIX months, until the City Council
adopts a new Incluslonary HOUSing Program ordmance Fees under the new program
could be higher or lower than the Intenm fees proposed here
BUDGETARY/FINANCIAL IMPACT
The amount of fee revenue produced as a result of these amendments depends on the
number and scale of projects that apply for permits dUring the effective dates ofthe mtenm
ordinance In lieu fees collected pursuant to thiS Intenm ordinance will be deposIted Into
a deferred revenue account untIl they can be programmed for use In accordance WIth
8
established budget procedures and necessary Council approvals Approval ofthe Intenm
ordmance does not have a financIal or budgetary Impact at thiS time
RECOMMENDA TION
It IS recommended that the CIty Council
1 Introduce for first reading an rnterlm ordinance amendmg Chapter 9 28 of the
S M M C relatmg to mcluslonary housmg (Attachment C)
2 Adopt the attached Resolution establishing the Incluslonary base pnce for purposes
of calculating the In lieu fee optIon for moderate-Income units (Attachment D)
Prepared by
Jeff Mathieu. Director, Resource Management Department
Robert T Moncrief. Housmg Manager
Johanna Gullick. Housing Coordinator
Barry Rosenbaum, Deputy City Attorney
Attachments
Attachment A
Attachment B
Attachment C
Attachment D
HR&A Capital SubSidy AnalYSIS for a Moderate-Income UnIt
Calculation of In Lieu Fee USing Interim Ordmance - December 1997
Interim OrdInance Amending Chapter 9 28 of the S M M C
Resolutron Establishmg Incluslonary Base price for Moderate-Income
Units
9
Attachment A
ATTACHMENT A
- I
i
t
~m g ~g ~~w ~ =OG. ~DU. ~N-
i! i ii fl! i iiii li;1 !f~
I ~ !I f i ~ I' ~
~l i j i~ j Ii ~II~ ~
i 1 ii i In
I I -f 12
! i - ~
~: _ _~ ~_ M __MM *_ M _ _
I. I ~ ~ _ - ~_~
fl I 'I iig ! ~]~~ ~'i~ .,.
_~ _ M ._._ __ _ _ _
'" '"
.. "'..
9 ~ i _ - ~ ~
~ .~ ~~: t ~~;= ~.ow ~R~
~ s ~~o N ~~~~ . SD ~~~
M __ M _ .... __ M _ ~
.. ~
2 H ~ - - ~ ~
; 'I ~!g I ~~J~ ! iH ala
I
~~ M _ __M_ __ . _ .
... ...
.. 5"
. ~ ~
.. .. Ji _ .... ...- -__-
~ 'i ~io f igjj S'.I .I~
i
.t
I'
if I ! '1 f!( ~ if If ~ft! ~~~
tll ~ II :!iJ ~ iJII !il.l !J!
iff i r ! ! 11 I I I If
Iii ji · I i iil ~f jl
Ii if I 1 ~ tl' II 'f
il I) I ~ ~ I r. II
1 I 1 II Ii
i ~ 1 tl I
~ I I ·
I j i ~
i I"
f f
.;z .a
f 1
;:; .
!Il
I
..
B
I
~ I
i
c~
Ii
!!
ilia
Ii
.~ il!l
~EC:
I~!
~s'"
II!
-51
'....
Ii
Ii
c
!
J ~ IliJIIJiJi ! IIli~ IJIJlfi1i11 Ijl~JII lili1il,
I il,ci ill I i I I IIi t"
. ...1 If 1 l I
,Ii' J!. tI
I
- J ; ... z
ii !Jii .. In .. lUu li!r; ~ r ;
Ui1lm I rlfffflr: UliNI ~
III .. I
I I f ~
.... ........................ ... .......... ...................... .............. ............... -I i ;
,. - -
J ....a:illlfhnl i .... .. is...::=...........1: Jc~ii;; I- I n
:i fl.. i~i. e iAi5 ;a.~"laa.g Alln.. ifllliU I !
.. M.................. .. .............. .----..-.... ............... ............. l frUit I
! = - -.....-- o _ -,.. - ... iii-otl;l !;s !S;: J 1...~
l !!!IIISi~~ ! Iilllll ii"WI"sWU";i I I~IR h:.lr:~1
Ill;: II ;: III
1111111 ~ c~
.. :II J I~N" (1
ii ~Iii .. ~n .. mn ;;ifi i Ili!I~1 i
Ui1lm I rrrrfflli -4
.. II
ijl .. i III~ I
I I ;
.1;1 'I .~II
- ................-.. .. ........ ........--....... --........ M_........
..
p ICilss :" .. I 'i'~ I
J i~,.li.I;1J ; ii.i Ili.siiii; liiiill
i II i I IIi 11 ~i if
I _ ............... ... ...... -................ .......... ............. I III
I !:! - .. - i,..~.i I .-
i ~!Iiliiii ... - -... - .. II~
f 'Ullll ~i;liiali~ IJi. II li..~1 ·
..il
lllllfff I III 111111111 11111 l'l'[ IIi
iiii.. i Iii 9iiliiiii 1'11' 1111!
11111511 I I IIII111II Ii iliil II
JJJJII~~ J J JIIIJJIJJ J JJ IJJJi
i
III1II11 i I 1IIIII111 I II nm I
(fulfil I IIIIIIIII f 1111'"
111111 2 I1II111I1 1 1111
ir
I i
1
i
~
I"
i
.
~
I
J ~ It1i!illli I IIJi~ 111'1111111 li~~JII Ilr:lll
· JIJiHi I iil r ~ii Ii I:f hi, I K
Ililliff i III I1111 lilt lifll Ililf I
- --___~Ma~ _ M_M~ MM........ MMM_MM ______ ~
i iiiii;i;; i i'li ~ii)iiiii; iCilli ~illll l
- .M..__... M ._M. ._._MM.... ______ MM....
B ~ - ~.~N W - ~.. .. - . i..H. B B~-
I !~!~IDlije ! ~I~I 1~~ili~ESI allglE =5~BDI iN
i
rriljiff I Irl rrrrrrrrf lillr
- -_____.-_ _ M__. ________~_ M_____
i ~iiii;iii i ii.i Gliiiiiii; Ililli
- M__~..___ _ ____ __.___.___ ______
I .5!iliiii i il~' ii~i.j~g!i ;i&;le
llll'lff I l~l ~llllllll 11111
IIIIIS(I f 'I' I1II1111I I'J)I
JIIIJ!~~ J J JIIIIIJII I II
11!!lill,. i I II!IIIIII I ii
Illtl1iii I lllllllll I
if
,Ii
I
iii
i
~
J
i
.
I:
iI
iiif;
III ..
............... ...
~ ~ l
liiiJI i
M._M._
I ~;::
I;!ical
lll'l
11111
iiiil
IUh
iIIl; I
1111
... z
1 I
nt*H ~
[ I
II"fiil I
I lS"i) I
It1!!U ;
11111 BJ .:
1111: !
..i I
i,ll ,{
'tl-: iI
Iii ;1
n
!
c~
z~
!i
I::
gii
liaC:
~I!
II~
-I!
'11
II
~
c
!!
Attachment B
Attachment B
Calculation of In Lieu Fee Using Interim Ordinance - December 1997
Low In Lieu Fee Moderate In Lieu Fee
Number Income For Income For Total
of Units Units Low Unit Units Moderate Unit Fee
BUilt Required ReqUirement Required Requirement Required
2 1 $ 56,055 0 $ 0 $ 56,055
3 1 $ 56,055 0 $ 0 $ 56,055
4 1 $ 56,055 0 $ 0 $ 56.055
5 1 $ 56,055 0 $ 0 $ 56.055
6 1 $ 56,055 1 $ 85,000 $ 141,055
7 1 $ 56,055 1 $ 85,000 $ 141,055
8 2 $ 112,110 1 $ 85,000 $ 197,110
9 2 $ 112,110 1 $ 85,000 $ 197,110
10 2 $ 112,110 1 $ 85,000 $ 197,110
11 2 $ 112,110 2 $ 170,000 $ 282,110
12 2 $ 112,110 2 $ 170,000 $ 282,110
13 2 $ 112,110 2 $ 170,000 $ 282,110
14 2 $ 112,110 2 $ 170,000 $ 282,110
15 3 $ 168,165 2 $ 170,000 $ 338,165
16 3 $ 168,165 I 2 $ 170,000 $ 338,165
I 17 I 3 $ 168,165 2 $ 170,000 $ 338; 165
18 3 $ 168,165 3 $ 255,000 $ 423,165
19 3 $ 168, 165 3 $ 255,000 I $ 423,165
;
20 3 $ 168,165 3 $ 255,000 $ 423,165
Attachment C
f \atty\mum \law\bany\housing 2
City Council Meeting 12-16-97 Santa Monica, Cahforrua
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA
AMENDING SANTA MONICA MUNICIPAL CODE SECTIONS 928030,
9 28 050, AND 9 28 070 OF THE SANTA MONICA ~1UNICIP AL CODE
RELATING TO THE IN-LIEU FEE REQUIREMENTS OF
THE INCLUSIONARY HOUSING PROGRA.l\1
WHEREAS, on Apn115, 1997, the City Council gave conceptual approval to the 1998-2003
Draft Housmg Element, and
WHEREAS, Program 2 a of the City's Draft Housmg Element reqUIres re\.1ew and reVISion of
the City's Inclusionary Housmg Ordmance dunng 1998-1999, and
WHEREAS, thiS program calls for the study of a number of potential modIfications to the
City'S Inc1usionary Housmg Ordmance, mcludlOg expansIOn of the Ill-heu fee optIOn, providmg
zoning lOcentlves in exchange for constructIon ofth1l1y percent (30%) affordable uruts on Site,
satisfYing the mclusionary obhgation by meetmg the reqUlfements of the State density bonus law,
and satIsfyIng the Illclusionary oblIgation by complymg WIth the reqUIrements oftax exempt bond
financmg, and
WHEREAS, at the Apn115, 1997 City CouncIl meetmg, the City Councll also directed staff to
uumedtately commence preparation of an ordmance amendmg the Inclusionary Housmg
Ordinance, and
I
WHEREAS, on July 8, 1997, the City Councll approved the selection ofHamllton, RabinovItz
and Alschuler ("HR&A") to prepare analyses relatmg to modifications to the CIty'S IncluslOnary
Housmg OrdInance, and
WHEREAS, HR&A was subsequently directed to provide an analysIs of the policy, financial,
phYSical and admimstrative ImphcatIOns of alternative strategies for Implementmg an mclusionary
housmg ordmance, and
WHEREAS, HR&A's scope of work was structured to occur m three phases, lasting from
mid-July 1997 through February 1998, and
WHEREAS, HR&A has completed the first two phases and IS currently undertakmg the final
phase of ItS scope of work - formulatton of specIfic ImplementatlOn program options, and
WHEREAS, SIX pOSSible alternatives to the City's Inclusionary Housmg OrdInance have been
presented at pubhc meetmgs before the City Housmg Commission on September 18, 1997, the
Planrung CommiSSiOn on September 10, 1997, and the CIty CouncIl on October 28, 1997, and
WHEREAS, staff antICipates returnmg to the Planrung CommissIon and the HOUSIng
Comnussion In January 1998 to present specIfic optIOns for reViSing the IncluslOnary Housing
Ordinance, and
WHEREAS, staff further antiCipates returlllng to the CIty Council m early 1998, at or about
the same time the City Council Will be consldenng approval of the 1998-2003 Housing Element,
with a detailed conceptual plan for amendmg the City's Inc1uslonary Housmg Ordmance,
developed at a suffiCient level of detaIl to enable the preparatIOn of a draft ordmance mmledlately
followmg CIty Counctl approval of the conceptual plan, and
2
WHEREAS, on November 11, 1997, the City Couned directed staff to prepare an intenm
ordmance which would revise the in-lieu fee component of the City's eXlstmg lnelusionary
Housmg Ordmance in response to concerns that the eXIsting law may be m conflIct with the Costa
Hawkins Rental Housing Act, CIV11 Code Section 195450 et seq , and
WHEREAS, HR&A subsequently prepared an analysIs of the appropnate tn-heu fee for a
moderate income urnt by assessmg the actual costs to develop a moderate Income unit, takmg into
account the portIOn of that cost that can be amortized by the maximum affordable rent, and
WHEREAS, the CIty Couned intends for thIS mtenm ordmance (heremafter "1997
ReVISIons") to be effectIve only untIl the CIty completes Its comprehenSIve reVIew of the CIty's
IncluslOnary Housmg Ordmance currently bemg undertaken and adopts a revIsed IncIuslOnary
Housmg Ordmance,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA J\10NICA DOES
ORDAIN AS FOLLOWS
SECTION 1 Santa Moruca MUniCIpal Code SectIOn 9 28 030 IS amended to read as follows
(a) An mclusionary requirement shall apply to aU projects fur w~lKh a. 0cvclupmcilt appIicatiuil
~Wa.S dtciiit:ct C0iilplctt: iinti rt1:huiliY 11, 1992, InvolVIng new constructlOn of two or more
residential market rate dwelhng units or condOlmrnum or cooperative converSIon of two or more
dwelhng units, or Involvmg new constructIOn of a smgle-famtly home when It IS replacing more
than one dwelling umt in a multifamlly dlstnct and more than one dwellmg umt would be allowed
on the property under the requirements of the Zoning OrdInance An mcluslOnary umt
reqUirement shall not, however, apply to tenant partlclpatmg conversions governed by the
proVisions of the Tenant OwnershIp Rtghts Charter Amendment, ArtIcle XX of the Santa MOllica
3
City Charter
Il" 1 !..' I' l- 1(..
""'. 'III" ... .-
""
I,
, .11,. I' '.. I
" I h.t.1 ~ il' ,
II '.
I..;' . ""I ,'~'I h'l h
III I I. ~ III ,d., \' ., " I, h:
I .. ~
. I
I'''. ..I
. .....
... I......... I i. I" ~ J l. .
",.:..Ih"i)
1'::1 Il , .....11,'1
\..1.. '\'.1.1\':..:,
I ...11 "....".. ;";
" II . I I'.. I I .l I ( , I
.- '. .lp;.'I...... I ;"1,,11
1,1 llll' t.n~."....l. ,:.m' ,': . Ic", ',- H\..I'I I..
. ~J I. ..[. "I.....
I.. .1
" I I II .. I. h,
-, I{. . I. I..' i ,I . (
I" .... I
.........1
tbJ (c) A project not subject to the 1')'(,' It!..\ .hll." tillS Clliipttc pursuant to subdlVlslOn fa) (b)
ofth1s Section shall be subject to the provisions of tIns Chapter as they eXisted on the date the
apphcatIOn for the project was deemed complete, except that with lespect to ailY piOJect fOi
whidl iiii applicatioil has beeil fUed but not aPPioved iit the tUlle tIllS Chaplel becomes effective,
the applicdiii cail elel,,;i to ha-ve the pluViSiOf6 of thiS Chaptef apply to tht:; pfojed
SECTION 2 Santa Momca :Mumclpal Code SectIOn 9 28 050 IS amended to read as follows
(a) The reqUirements of SectIon 9 28 040 shall be met either by provldmg on-site mclusIOnary
units meetmg the reqUIrements of SectIon 9 28 060 {'I ", I "" ~.... .-!i~' I :,', 1:11.\' I I J n...,.
I\.' ill I,: II." .... ,.1 ~l'. , "I' :....... . Jl eill1c{ of the foHuWiilg Cilcumstanct:;s
(1) Tl1e project j5 0il a ~iL:e fUJ- w]lich il0 CaleguIY C fC:J.YIOva~ pcfiiiIi "....as i~Sti~~ privi tu fctiUaiy
t%, 1992 (Oi was is;;ued aftt:;f F chl Ual Y 1 g, 1992;-but apphed fOf prior to feLL ua. y 18, 1992), alld
wttich tht:; developt:;d 'u5e on fetcLiafY 18, 1992, was illu]i.failliIy-h0u5iili; itild al ~t:;it5i. Oile dwel~ijlg
urLit was re.iii.~d at level;; aITviJaMt:; to housdl0~ds OfillLllienite iilCuiiie levels Oi if
vaCiLiii uii f' ~tluaiJ :i Ht 1992, Wh.efl last fcflted
4
(2) Tli~ pi-0j~Ct iiiv01v~5i I;h~ C0ii5iii-uCti0ii 0fiw~l1iy 0i- ir-.Or~ iiiili-k.;t i-ate dwellmg ulUts, excludmg
ai-IY deiisiiy t0iiu5i uiiii5i i0 whicli ilii appliCfuit i5i entitled under Go."erhnlent C",dt: $cCii0ii GS915
(b) TIi.;;. recfuii-ciiicfll;5i vf $cCtlvii 9 28 040 5ihan ue iiici ciili.;;.i- by piWvidiflg Oii-5i~ic ii..;:;h.iSi0iiillj
uml,s iiict:iiUi; ilic i-equii-ciii.;;.iit5i 0f Sectiun 9 23 060, 0f by 5iaiisfymg ihe requireiiit:iiis of9 28 070,
tfbvili ofth..:: fvlk,wiii8 clieUiii5iifuiCeS applY'
tl1 The pivject is 11vi 0ii a site a5i de5icribcd iii SUtdivi5iivii (a)(1) ufthi5i Se..:.i.iun-
(2) The project illVolvc5i the COii5il:i~uctioii ones5i thaii tWciity iiiiUkcl: rate dwenliig Uiiit5i,
t:XC:Udiug allY deilSity t0iiUS UiutS to which iiU ilpphCiii-lt i5i eiititled ur..1ei- Gvvei-ilii-IClit C0de
Sectlon G5915
(e) \.'v1ieuever ii-Ielu5ii0iiiliy Uiiit5i ili-e pi-0viclect 0il-5ilie, 5iuell Uiiit5i iiitist coiiiply With the
reqUii"~ii-It:i-It5i of St:cti0ii 9 2g OGO
(d-) V..'"l.lcii.;;."vci- illc p<i.yill.;;ilt vi ali iil-lieu &.;; i5 iiH0w.;;d by tlii5 Chapici", such paYTlleiil: iiiust
comply With the requifcmeiits of Section 9 23 070
teJ (b) At the tlme offilmg an applICatIOn with the CIty'S Planmng Department for penmsslOn
to develop multIfarmly market rate dwelhng umts, the developer shall specity the number, type,
locatIon, size and constructIon schedule of all dwelling umts proposed to be developed and shall
mdlcate which ofthe dwelhng umts, If any. are mtended to satisfy the mc1uslOnary housmg
requirements ofthfS Chapter
5
tf} (c) Once the developer of a project has elected to satisfy the reqUIrements of this Chapter
through the provision of mcluslOnary units on-sIte, or through the payment of an in~heu fee, such
opllon is determmatlve for the hfe of the project
SECTION 3 Santa Monica Mumclpal Code SectIOn 9 28 070 IS amended to read as follows
(a) Whenever 1...'\.', pl.1 d '.I".~ ',. ~ ,n~,' ','
,'~' I' ., ," tills Chapter by paying iilluw~
the payment of an m-heu fee, the"' 1
I.
requif~d II
'" :"_.:' ihclusionary unit nUliIDer shall be
determmed as follows 1,1':, ',I .: I .. I" I'~' II II..
I ,,'" II I ... .': I:. . ..
...\.:... IL.~.I':i
"II. ..... ~I .11,1 l" "',". ','I )"'1-' , I ,I II ,II., ", ,.
II " , ,\. ,I. 1 '"
. I"l :..... '" . -: I",
.:.," 1.1,1:. ...111 ... ~h'l....1 P.. I . .1 I.... .1 Ii... '\
. 1 ."
,
II
I , h: '
. I :.
,. ,
. .
I ... I,,: ..... I" \, : I. ...... II l
..' c... _' l II .1 'J _'.;., ,: I
I .,"" , .\
..
I...
n .. '" :.. ..
.,.. ._'" .... I'" ....I; I. 11
. ,1-, lid,
I I.'
:.......1 I....., I. = "
11111 '" ..,: I
1\ " I.,
, \
,
, "
I I' ."
\,.;" 1"."1 , "', - ",
. I
....! ,..1
, :. ,1. ,I.: I."
...1: ..:_1I "I !!:) ,.1,'1 - ...~~!.
....T__.-_L_.._ _r"_____...._ ~__ ....,__ ____~__.L /____1__..1____ ..J_____.L__ L______ _ _~.L~'\__
'1UlllU~J VI Ullll;:> HJ un;; pJUJ\;;\,;l "~A~IUUHlO U\;;H::>JlY UUUU::> UlllL:I) ....
30% = lequired iiiduSIuiliilj unIt fllii-IILer The first IhcluslOnary UhJt lequired sllall be affordable
to-luw iiiCuilie huusehulds, ai-ld the secui-u,i 1;0 iiloder ate lllcome hOi.i~ehulds Addrttuiici1
mdusiuiialj uiiilS ~hall alle1llate belwef:iiluw iiilct iYlude1at~ iiiCuiil~ uiiit~ Aiiy fi-aCLJuii uf a uiiii
requti~u s~iaH iiut be Cuii~idel~d ~ithe1 a luw U1 muct~iat(:; tilCullie i.mit
-Ari iii-lieu f(:;e iiiay 01.':; paid onty fui-lu\.v iflCuiiie uiiiis i-eyuired. aiid aiiy fraciiuii uf a. \.Iiiii i-equii-ed
All iiLucteiCiie iilcuiiie l:uiiis i~ytii1ed slia.H be pi0Vict~d Oil-Siie TIl.e fee sliaH be d~teiiiiiiied a.~
foHuws-
(1) I'ui iLiiY ~uw iflC0iiie uiiii, the iil.-lieu fe~ Pd.YJIl.cil.l ieqwicd sha:~ equal th~ iiidu5i0iiiiiY uiiti:
base pi-ice, as e~iabl:ished iii ~utdiViSiuil. (c) ufthls Section-
6
tz1 Fu{ ailY fli&Ci:iull uf a uilit lcqui{~d> thc iil-h.;:u fee shaH equiit the iiiCh.1S1vililiy UfUL tas~ pi-ic~
.....~__ _ _ ...1_ _ .L!'__ _.. _ __ _~ _ __~_.J ___ _ ____.J
Llll'\;;~ ~1J\;; U U..,UVH V.L U UUll . "''i Ull \;ill
(b) Tlic fulh.lwiiig Clliui ilh.isiiilics ihc .Ili-hcu fcc payilbl~, the ilUf(lbci uf 0il-Sit~ melusiuiiiiLj Ullll~
reqUilect, il.tlll wlJ.;i:licl such units i-llUSt be affurdable tu luw vi llivueritte ..IiC0iYlI.:; levds, uSiilg, fui
IllustI atlV e pUl poses on~y > afl mduSiOiiai)' UfLiI: bilSe p{iCe of Sixty thOW;iiild dolLafs-
N u. "IT iiil5 Built
l'YIudi:;rate
Fee
T"'I___.__...I~__ _....... ____~..1 _
L",uuunl~ .l.l't:Il~UJ'
fndu5h;li~h)' Uilits
...... - - -- -
.an,tIlU3
Oil Site
2 0 $ JG,OOa
3 0 54,000
4 0 72,000
S 0 90,000
G 0 108,000
7 1 GG,OOO
g 1 94,000
9 1 lG2,CatJ
10 1 - 12G,GGe
tc1 (b) For purposes of thIS SectIOn, the mcluslonary umt base pnces ,'I .. 1 ..
"" II ..
r...~,.'.'"'' , .,1" .".1 ,'1.. ,I
I
'.I~
, ",
I .
... .. I
"hall be estabhshed and adjusted from
7
time to time by resolutIOn of the City CouncIl based upon \.1 , ,..;, '~.lll '.. lhe cost to the City
of subsidizing the constructlOn of new I ' \ ,I~ 'I ~. II 1 '..., , ;: ."n " : ." residentIal umts Any fee
reqUIred pursuant to thIs Section shall be adjusted for mflatlOn by the percentage change In the
Consumer Pnce Index ("CPI") between the date of adoption of the Resolution estabhshing the
inclusionary umt base pnce through the month In whIch payment IS made For purposes of this
Section, "CPI" shall mean the index for Urban Wage Earners and Clencal Workers for All Items
for the Los AngelesfLong Beach! Anaheim statistIcal area, as published by the United States
Department of Labor, Bureau of Labor StatistIcs
W (c) Fifty percent (50%) of any fee reqUired pursuant to thiS SectIon shall be paId pnor
to the Issuance ofa BUlldmg PermIt for the project The remalrnng fifty percent (50%) shall be
paid In full before a certificate of occupancy IS Issued for any urnt m the housmg project
(eJ (d) Any fee reqUIred by thIS Section shall be secured by executIon of an Irrevocable
letter of credit in favor of the City or other secunty acceptable to the CIty for the total amount of
the oblIgation The letter of credIt or other acceptable secunty shall be delIvered to the City pnor
to the issuance of a bUlldmg permt for the housing development The letter of credIt or other
security shall be released and returned to the developer nnmedmtely upon payment in full of the
in-lieu fee
(f) (e) Any payment made pursuant to trus Section shall be deposited m a Reserve
Account separate from the General Fund to be used only for development of1o~
,
, . . ..
II I.. I.. . lit.
Income housmg
8
(g1 (t) If an lfi-lieu fee IS paId pursuant to thIs Section, such payment shall not be
consIdered provislOn of mclusionary units for purposes of determining whether the housmg
development qualifies for a density bonus pursuant to Government Code SectIOn 65915
SECTION 4 Any provision of the Santa MOnica MunicIpal Code or appendices thereto
inconsistent with the proVISions oftms Ordmance, to the extent of such mconSlStenCles and no
further, IS hereby repealed or modified to that extent necessary to effect the provisions of tlus
Ordmance
SECTION 5 If any sectlon, subsectIOn, sentence, clause, or phrase of thIs Ordmance IS
for any reason held to be mval1d or unconstitutional by a deCISIOn of any court of competent
Junsdictton, such deelSlon shall not affect the vahdlty of the rernammg portIOns of this Ordmance
The City CouncIl hereby declares that It would have passed this Ordmance and each and every
sectIOn, subsection, sentence, clause, or phrase not declared invahd or unconstltutional without
regard to whether any portion of the ordmance would be subsequently declared mvahd or
unconstituttonal
SECTION 6 The Mayor shall sIgn and the City Clerk shall attest to the passage of this
Ordmance The CIty Clerk shall cause the same to be pubhshed once in the offiCIal newspaper
WIthin 15 days after its adoptton Tills Ordmance shall become effectIve 30 days from ItS
adoption
APPROVED AS TO FORM
lrJ'/AAJ~~
~SHA JO~OUTRIE
City Attorney
9
Attachment 0
r .- '..._'
f \atty\muni\law\barry\housmg.res
City Councll Meeting 12-9-97
Santa MOlliCa, Cahfoffila
RESOLUTION NUMBER __ (CCS)
(City CouncIl Senes)
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF SANTA MONICA ESTABLISHlNG THE
INCLUSIONARY UNIT BASE PRICE FOR
A MODERATE INCLUSIONARY UNIT
WHEREAS, the City Council of Santa Monica adopted Ordmance Number 1615 (CCS)
on March 3, 1992, the City'S InelusIOnary Housmg Ordmance; and
WHEREAS, Santa Monica Mumclpal Code SectIon 9 28 070( c) of the Inclusionary
Housmg OrdInance provides that the City CouncIl by ResolutIOn shall estabhsh and adjust from
time to tIme the inc1usionary unit base pnce for purposes of determInIng m heu fees based on the
cost to the City of SUbSIdIZIng the construction of a new resIdentIal unit, and
WHEREAS, the City CouncIl adopted Resolution Number 8414 (CCS) on June 9, 1992
wluch established the m- heu fee amount for the construction of a low mcome umt at $51.000 00;
and
WHEREAS, tlus Ill-heu fee is adjusted by the Conswner Price Index ("CPI") at the time
that an In-lieu fee payment IS made and the current In-heu fee for a low Income melusIOnary urnt
IS $56,055.00.
WHEREAS, the City CouncIl has not prevIOusly established an m-lieu fee amount for the
constructIOn of a moderate income unit since the InelusIOnary Housmg Ordinance reqUIred that
all moderate income units be constructed on site, and
....-.... ~.
WHEREAS, the C1ty COUllCll now des1res to establIsh an in-heu fee amount for a
moderate Income urnt; and
WHEREAS, the C1ty Council finds that the weighted average CIty subsidy per unIt that
would be required to construct a moderate Income unit is approximately $85,000.00,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES RESOLVE AS FOLLOWS:
SECTION 1, The mcluslOnary unit base price for the purpose of deternnmng In heu fees
for moderate income umts pursuant to Santa Monica MuniCipal Code Section 9 28.070(c) 1S
$85,000 00
SECTION 2 The City Clerk shall certIfy to the adoptIOn of this ResolutIOn, and
thenceforth and thereafter the same shall be m full force and effect.
APPROVED AS TO FORM
, (
1'1 ."" I ) .
,J rltlL{)L..{L f~L<--oI!4:"V\. --!~,
MARSHA JONBs MOUTRIE
City Attorney