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SR-212-001-01 , . . . "'7 /.--. ...?- / ~ ~ .:::::~) / - c? /' i-c.- .. CA:RMM:l14BOb/hpc City council Meeting 2-20-90 FEB 4 7 1990 Santa Monica, California ~ 1 ?, ~C(., 1 --0 t STAFF REPORT TO: Mayor and City council FROM: City Attorney SUBJECT: ordinance Implementing Policy 45 of the city's Draft Local Coastal Program Establishing Mitigation Fees for the Removal of Low Cost Lodging Accommoda- tions in the Santa Monica Coastal Zone At its meeting on February 13, 1990, the city Council introduced for first reading an ordinance establishing a fee to mitigate the loss of affordable hotel and motel rooms within the Coastal zone, as required by the City'S Draft Local Coastal Program. The ordinance is now presented to the City Council for adoption. RECOMMENDATION It is respeetfully recommended that the accompanying ordinance be adopted. PREPARED BY: Robert M. Myers, City Attorney Laurie Lieberman, Deputy City Attorney i-C FER 2 ': :.990 . ~BEFelRE DISTRIBUTION C....:::K CONTENT DISTRIBUTION OF RESOLUTION * Council Meeting Date % 7 (,If f-e Was it amended? fro OF ALL FOR CITiltLERK1S ACTION ORDINANCE # / SI G Introduced: q7h? /1 Z) Adopted: o/=? 7/9 () ALWAYS PUBLISH ADOPTED ORDINANCES Cross out Attorney's approval Agenda Item # VOTE: Affirmatlve: ~ ,r Negatlve: Abstain: Absent: e:~~~ ~ PROOF VOTES WITH ANOTHER PERSON BEFORE ANYTHING DISTRIBUTION: ORIGINAL to he slgned, sealed and flIed ln Vault. ~-r:~ ,~;~t-~ J ;:-~I ~--. NEWSPAPER PUBLICATION (Date: ) I Department orlginatlng staff report( Laurie Lleberman) Ordlnances only for Attorney ( Claudla Thompson) 2 Management Servlces Lynne Barrette ORDINANCES ONLY 1 Agency mentioned ln document or staff report (certified?) SubJect fl1e (agenda packet) 1 Counter file 1 Others: (Revlew Alrport AuditorlUTI1 for departments who need to know). Parking Auth. Personnel BU11dl.ng Dept. Plannl.ng I C/ED Police Finance Purchaslng General Servo Recr/Parks Llbrary Transportatlon Manager Treasurer Fire 4..-.? 6~ } - SEND FOUR COPIES OF AI.L ORDINANCES TO: CODED SYSTEMS 120 Mal.n Street Avon, New Jersey 07717 4 SEND FOUR COPIES OF ALL ORDINANCES TO: 4 Debra Myrlck Santa Monica Munlclpal Court 1725 Ma2n Street, Room 118 Santa Monlca, CA 90401 Total Copies , .., $"-- 'r" . . 1 CA:RMM:lld580jhpc city Council Meeting 2-20-90 Santa Monica, California ORDINANCE NUMBER ~(CCS) (City council series) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA IMPLEMENTING POLICY 45 OF THE CITY OF SANTA MONICA DRAFT LOCAL COASTAL PROGRAM ESTABLISHING MITIGATION FEES FOR THE REMOVAL OF LOW COST LODGING ACCOMMODATIONS IN THE SANTA MONICA COASTAL ZONE THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES ORDAIN AS FOLLOWS: SECTION 1. Findings and Purpose. The City Council finds and declares: (a) In recent years, there has been a significant shift in the development of visitor accommodations within the Santa Monica Coastal Zone from low cost lodging accommodations to luxury lodging accommodations. Since 1984, six luxury hotels containing 1,109 rooms have received City approvals within the Coastal Zone while no new low cost rooms have been proposed in this area. (b) The City of Santa Monica has experienced a significant reduction in the number of low cost lodging accommodations due to demolition and conversion of existing units and construction of office development and luxury lodging accommodations. since 1984, approximately 355 low cost rooms in the Coastal Zone have been demolished and not replaced, representing a loss of forty-five percent (45%) of the low cost rooms existing in the Coastal Zone as of 1984. - 1 - J -.. . . j , J .. (c) The vast majority of visitor accommodations in the Coastal Zone removed from the market due to demolition are low cost lodging accommodations. Cd) The demolition of low cost lodging accommodations in combination with the replacement by, and new construction of, luxury lodging accommodations has altered the balance and has contributed to the scarcity of affordable visitor accommodations in the City. Only fifteen percent (15%) of the total hotel-motel accommodations which will exist in the Coastal Zone once the new ci ty-approved accommodations are completed, will be low cost accommodations. Ce) Policy 45 of the Draft Local Coastal Program provides for a mitigation fee where new development removes low cost lodging accommodations. (f) Pursuant to the police power, the City has the authority to address both the imbalance created by the removal of existing low cost lodging accommodations and the overall need for affordable visitor accommodations in the City. (9) The purpose of this Ordinance is to reduce the negative impact on affordable visitor accommodations caused by new commercial and new hotel and motel development which requires demolition of existing visitor accommodations. (h) New commercial and new hotel and motel development which requires demoli tion of existing low cost lodging accommodations is generating a reduction in the city's affordable visitor accommodations, and increases the imbalance between coastal activities and affordable visitor accommodations in the City. - 2 - I .". ~. -- - . . (i) The City has a continuing need for low cost visitor accommodations and such need is exacerbated by the demolition and conversion of such units and construction of new commercial developments. (j) Any fees collected pursuant to this Ordinance shall be used only to finance the construction of low cost lOdging accommodations. (k) The fee requirements of this Ordinance will help diminish the overall loss of low cost lodging accommodations in the city and to mitigate the adverse consequences of removal of low cost lOdging accommodations in the Coastal Zone. (1) The facts and evidence presented in the Draft Local Coastal Program dated October, 1989, in the "santa Monica Coastal Zone Motel and Hotel Room Survey" prepared by willdan Associates, dated January 18, 1990, and in the california Coastal Act of 1976, establish that there is a reasonable relationship between the need for the replacement of low cost visitor accommodations which is removed by demolition and the fee established by this Ordinance, and also that there is a reasonable relationship between the use of the fee and the type of development for which the fee is charged. (m) The fees required by this Ordinance do not exceed the reasonable costs of constructing replacement units as demonstrated by the II Evaluation of Financial Assistance Requirements for the City of Santa Monica's Overnight Affordable Accommodations program," a studied prepared by Natelson Levander Whitney, Inc., dated December 11, 1989. - 3 - , ~ . . I SECTION 2. Definitions. The following words or phrases as used in this Ordinance shall have the following meanings: (a) Fee. A fee paid to the City by a developer pursuant to this Ordinance to mitigate the removal of low cost lodging accommodations. (b) Low Cost Lodqinq Accommodation. Any hotel or motel unit designed, occupied, or intended for occupancy, as a temporary lodging place for individuals for less than thirty (30) consecutive calendar days for which the room rate was Eighty Dollars ($80.00) or less as of December 12, 1989, or as of the last day of operation if the hotel or motel was not in operation as of that date. (c) Remove or Removal. The demolition of low cost lodging accommodations or the conversion of such units to other use. (d) Santa Monica Coastal Zone. The approximately 1.5 square miles bounded on the west by the Pacif ic Ocean, on the south by the City's southern boundary, on the east by Lincoln Boulevard south of Pico Boulevard, and by 4th Street north of pico Boulevard as far north as San Vicente Boulevard. Along the San Vicente Boulevard centerline, the boundary goes inland to 7th street to the northern City boundary. (e) site. One or more contiguous parcels under common ownerShip which have been used, developed, or built upon as a unit. - 4 - -.. . . SECTION 3. Kitiqation Fee Requirement. (a) No person shall remove low cost lodging accommodations in the Santa Monica Coastal Zone unless the person has complied with the provisions of this Ordinance. (b) No permit, license, or other approval shall be issued or granted by the city for the development or use of any property from which any low cost lodging accommodations have been removed until the person seeking the license, permit, or other approval has complied with this Ordinance. SECTION 4. Applicability. This Ordinance shall apply to: (a) Any development, project, or other activity involving the removal of any low cost lodging accommodations in the Santa Monica Coastal Zone. For purposes of this Ordinance, development, project, or other activity shall include the creation of a parking lot, open space, or vacant land on a site previously occupied by low cost lodging accommodations. (b) Any site located in the Santa Monica Coastal Zone from which the removal of low cost lodging accommodations has been approved and as to which a condition requiring the payment of a mitigation fee has been imposed by the California Coastal commission. SECTION 5. Fee. (a) The low cost lodging mitigation fee required by this Ordinance shall be satisfied by payment of a fee to the city in the amount required by this section. (b) The amount of fee required pursuant to this section shall be based on the number of units to be removed. For each - 5 - . . f ! .' . low cost lodging unit removed, a fee of Eiqht Thousand Dollars ($8,000.00) shall be required. (c) Any fee payment required pursuant to this Section shall be adjusted for inflation by the percentage change in the Consumer price Index ("CPI") mUltiplied by .65 plus the percentage change in land cost multiplied by .35 between the date of adoption of this Ordinance through the month in which payment is made. (1) For purposes of this Section, cpr shall mean the index for Urban Wage Earners and Clerical Workers for the Los Angeles/Long Beach/Anaheim statistical area, as published by the United States Department of Labor, Bureau of Labor Statistics. (2) For purposes of this Section, "land cost" shall mean the average purchase price per square foot for commercially zoned property, as determined through an independent survey performed for the Community and Economic Development Department by a qualified real estate consultant and adjusted on an annual basis. SECTION 6. Payment of Fee. (a) At the time of application for a demolition permit or other approval necessary for the removal of low cost lodging accommodations located in the santa Monica Coastal Zone, the developer shall enter into a compliance agreement for payment of the fee in accordance with the provisions of this section. (b) The compliance agreement shall contain the following requirements: - 6 - . . (1) At least fifty percent (50%) of the fee shall be paid prior to issuance of a demolition or building permit for a project on the site. (2) The balance of the fee shall be paid prior to issuance of the certificate of occupancy for any development or conversion on the subject site. If no certificate of occupancy is required for the conversion or other new activity on the subject site, the balance of the fee shall be due upon commencement of the new activity or within one year, whichever occurs sooner. (3) The agreement shall create a lien on the property which shall be binding on the developer and any successor of the developer, including any person acquiring an interest in the property by foreclosure, trust sale, or other proceeding. (4) Payments shall be adjusted annually for inflation pursuant to section 5. (5) The compliance agreement shall be recorded. (6) Such other provisions as are reasonably deemed necessary by the city to ensure payment of the fees required by this Ordinance. (c) The fee required by this Ordinance shall not become effective until sixty (60) days from its adoption, pursuant to Government Code section 65962(a}. SECTION 7. pursuant to this Account separate Deposi t and Use of Fee. Any payment made Ordinance shall be deposited in a Reserve from the General Fund to be used only for - 7 - ~ --~ . . ! development of low cost lodging accommodations in the Santa Monica Coastal Zone. Any interest income earned by monies in snch account shall be expended only for development of low cost lodging accommodations in the Santa Monica Coastal Zone. SECTION 8. Applicability of other City Ordinances and RegulatioDs. None of the provisions in this Ordinance are intended to supersede any provisions of the city Charter, ordinances, regulations, or resolutions concerning demolition of residential housing, relocation of displaced tenants, rent control removal within fifteen (15) days after its adoption. SECTION 9. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, are hereby repealed or modified to that extent necessary to affect the provisions of this ordinance. SECTION 10. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of any competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The city Council hereby declares that it would have passed this Ordinance, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional. - 8 - , -'" . . SECTION 11. The Mayor shall siqn and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause the same to be published once in the official newspaper within ~5 days after its adoption. This ordinance shall become effective 30 days from the date of its adoption. APPROVED AS TO FORM: ~VY\..~~ _ ROBERT M. MYERS \J City Attorney - 9 - . ... ~ . . J t ~ Adopted and approved this 27th day of February, 1990. ~~- Mayor Pro Tempore I hereby certify that the foregoing Ordinance No. 1516(CCS) was duly and regularly introduced at a meeting of the City council on the 20th day of February 1990~ that the said Ordinance was thereafter duly adopted at a meeting of the city Council on the 27th day of February 1990 by the fallowing Council vote: Ayes: Councilmembers: Abdo, Finkel, Jennings, Katz, Reed Noes: Councilmembers: None Abstain: Councilmembers: None Absent: Councilmembers: Genser, Mayor Zane ATTEST: cl .Ms.. c~. Clerk