SR-400-005-13 (6)
PCD:SF:JT:AS:PF\f:\plan\share\council\strpt\drthresholds2.doc
Council Mtg: October 24, 2000 Santa Monica, California
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Adopt an Emergency Interim Ordinance to Modify
Article IX of the Santa Monica Municipal Code Relating to Development
Review Thresholds in the RVC Residential Visitor Commercial District, BCD
Broadway Commercial District, C2 Neighborhood Commercial District, C4
Highway Commercial District, C5 Special Office Commercial District, C6
Boulevard Commercial District, CM Main Street Commercial District, CP
Commercial Professional District, M1 Industrial Conservation District and
LMSD Light Manufacturing and Studio District.
INTRODUCTION
This report recommends that the City Council introduce for first reading an emergency
interim ordinance to reduce the development review thresholds in the RVC Residential
Visitor Commercial District, the commercial districts which abut residential districts and the
industrial zoning districts throughout the City. Staff recommends adoption of an
emergency interim ordinance to allow for a comprehensive planning process to revise the
development review thresholds in these areas on a permanent basis.
BACKGROUND
A Development Review Permit is required for the construction of certain projects for which
the design, siting and size could result in an adverse impact on the surrounding area. The
permit allows for the review of the location, size, massing and placement of the proposed
structure on the site, particularly as it relates to the existing context of the area in which it
is located. The Zoning Ordinance establishes threshold criteria by zoning district for
discretionary review of projects exceeding certain sizes. The development review permit is
reviewed and acted upon by the Planning Commission following a noticed public hearing.
Since approval of a development review permit requires a discretionary action by the
Planning Commission, the proposed project is also subject to the provisions of the
California Environmental Quality Act (CEQA) in accordance with Section 15061(b) of the
CEQA Guidelines.
Based on the size and impact of recent development, the City Council has expressed
concern that the current development review thresholds in the commercial corridors of the
City are too high. The City Council also requested information on the definition of a project
under the California Environmental Quality Act (CEQA), specifically as it relates to
development on adjacent and nearby parcels. Developers can now make multiple
applications for a series of smaller projects on adjacent properties rather than a single
application for the full development contemplated, resulting in project approvals that are
not subject to environmental review or public hearings. On June 13, 2000 the City Council
discussed the impacts of these issues on the City. In particular, Council noted that, in the
commercial corridors, the 30,000 square foot development review threshold allows for
administrative approval of projects adjacent to residential areas that result in adverse
impacts on residential neighborhoods.
This staff report provides analysis from the CEQA Guidelines regarding:
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The definition of a project under CEQA;
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Projects that are subject to environmental review; and
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Segmentation or the dividing of larger projects into smaller developments.
In addition, this report provides:
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An analysis of the development review thresholds City-wide;
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A summary of development trends in the City over the past 4 1/2 years, and
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Proposed changes to the development review thresholds.
The proposed interim ordinance modifying the development review thresholds is contained
in Attachment A.
DISCUSSION
CEQA Guidelines and Definition of a Project
The CEQA Guidelines, the Public Resources Code, and case law establish how projects
are defined, when projects are considered ministerial and discretionary, and what
constitutes segmentation, or the dividing of larger projects into smaller components.
In relation to development projects, CEQA defines a project as an activity which may cause
either a physical change in the environment, or a reasonably foreseeable indirect physical
change in the environment. Development permits are a “project” subject to CEQA in that
they qualify as an activity that involves the issuance to a person of a lease, permit,
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license, certificate, or other entitlement for use by one or more public agencies.
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Exemptions
CEQA provides statutory and categorical exemptions for various project types. Projects
qualifying for the exemptions are not subject to CEQA and are not required to prepare
environmental documents.
A commonly used exemption is for ministerial projects (Public Resources Code Article 18,
Statutory Exemptions, Section 15268). Ministerial projects are reviewed solely in relation to
established standards or other objective measurements and typically include such actions
as building permits or administratively approved development permits. CEQA defines
“ministerial” as a governmental decision involving little or no personal judgment by the
public official as to the wisdom or manner of carrying out the project. The public official
merely applies the law to the facts as presented but uses no special discretion or judgment
in reaching a decision. CEQA allows public agencies to establish their own thresholds for
determining when ministerial or discretionary review is required:
the determination of what is ministerial can most appropriately be made by the
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particular public agency involved, based upon its analysis of its own laws, and
each public agency should make such a determination either as part of its
implementing regulations or on a case-by-case basis.
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The City of Santa Monica has established different discretionary review thresholds for
multi-family residential, commercial and industrial districts (Attachment C). Projects that
fall below the thresholds are ministerial and exempt from CEQA. Projects that either
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exceed the thresholds or require a variance, conditional use permit or other discretionary
permit are subject to CEQA.
Legal, Environmental, and Planning Concerns
In Santa Monica, where projects have been sized to fall below the square footage
thresholds that require development review, there are legal concerns regarding
segmentation and environmental concerns regarding incremental impacts of development
that are not fully addressed. Additionally, there are planning concerns regarding projects
that have been designed to avoid discretionary review by limiting the project size to just
below the zoning district’s development review threshold.
Segmentation
Segmentation for purposes of CEQA is the division of a large project into many little ones,
each with a minimal potential impact on the environment but which cumulatively can have
a significant impact. In Santa Monica, segmentation could result when multiple projects in
close proximity are approved that are less than 30,000 square feet is size. Over the last six
years, projects have been developed on adjacent parcels where the cumulative total
square footage meets the discretionary review thresholds but individually fell below the
threshold. As a result, the projects were subject to administrative review and exempt from
CEQA. The Zoning Ordinance does not define “project” or specify when development on
adjacent parcels under common ownership constitutes a single project. Therefore, nothing
in the Zoning Ordinance directly supports an assertion that development on adjacent
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parcels constitutes a single project and consequently, no zoning regulation requires
discretionary review of such contiguous projects. There are at least two ways to address
the issue of contiguous projects, one would be to initiate a text amendment defining the
circumstances under which development on more than one parcel would be considered a
single project. For instance, projects that share resources such as parking, access, or
open space could be considered to be part of a larger project. However, if adjacent
projects have no shared resources, they would not be viewed as segmented components
of a larger project. Another way would be to lower the development review thresholds to
require discretionary review of smaller projects as is recommended here.
Incremental impacts of development that are not fully addressed
Since CEQA contains statutes that exempt many projects from environmental review, the
incremental impacts of each new development project may not be fully analyzed and
mitigated. For example, additional vehicle trips added to the roadway network by
ministerial projects are not individually calculated or analyzed. The result is that these
projects are not held responsible for mitigating adverse environmental impacts
Development Size
Currently, the City’s development review thresholds range from 30,000 square feet in the
downtown area, C5 and C6 districts, to 25,000 square feet in the C4 district, and 22,500
square feet in the BCD and CP districts. The lower density, C2 neighborhood commercial
district and CM Main Street districts allow an 11,000 square foot development review
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threshold. Since these thresholds still enable a developer to construct a moderate size
project, developers often opt to build projects that fall just below the district threshold
specifically to avoid discretionary review. While smaller projects have the potential to
produce a more dynamic and varied city environment, developments on small lots, due to
the physical limits of a smaller land area and associated economics, are generally less
likely to integrate a mix of land uses or provide substantial on-site amenities. With the
increased flexibility afforded by a larger lot, there is greater potential to provide a mix of
uses, shared parking, and useable common open spaces. Larger developments may not,
however, complement adjacent and nearby development in terms of design aesthetics,
proportion and context.
Options
The Citys Zoning Ordinance could be modified to define when adjacent projects are
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considered to be components of a larger project. The criteria could be related to shared
facilities, common ownership, timing of development, or type of use. One potential
problem is that the first project in a series of projects may be exempt, while ensuing
projects would trigger the need for environmental review.
The easier and more effective alternative to prevent segmenting on an interim basis is to
lower the Development Review threshold to require review and approval by the Planning
Commission with concurrent CEQA review.
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Development Review Thresholds
The City’s development review thresholds vary from 5,000 square feet in the C2 district
along Montana Avenue (recently reduced from 11,000 square feet by Ordinance 1978) to
30,000 square feet in the “downtown” zoning districts (BSC, C3 and C3C), the industrial
zoning districts, the C5 Special Office District, portions of the RVC Residential Visitor
Commercial District and the C6 district along Wilshire Boulevard (Attachment C). The
thresholds are based upon the floor area of a project, consistent with the floor area
definition contained in the Zoning Ordinance. However, for purposes of calculating floor
area for development review thresholds, any residential square footage in the RVC and all
commercial districts except the BCD and C5 is counted at 50%. This policy reflects the
City’s desire to encourage the development of multi-family residential units within mixed-
use projects.
Recent Project Approval History
Development projects which are below a district’s development review threshold undergo
administrative review and approval. This review is considered a ministerial activity as
discussed earlier in this report. Ministerial review ensures that projects comply with all
established regulations and standards before project approval. These projects include both
the construction of new buildings and additions to existing buildings. Exceptions include
those buildings or additions constructed for a use that requires a discretionary approval
such as a Conditional Use Permit for an automobile dealership or a Design Compatibility
Permit for a condominium.
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Analysis of Administrative Approvals issued from January, 1996 through June, 2000 for
projects in commercial and industrial districts determined that the largest projects have
occurred in the downtown districts. Consistent with the City’s General Plan, these districts
have the highest allowable floor area ratio (FAR). Attachment D shows that 69
Administrative Approvals were issued during the study period for both new buildings and
additions throughout the City. The average (mean) new building project size was 16,782
square feet with the median project size at 11,348 square feet. Additions to buildings
averaged 6,823 square feet with a median size of 3,586 square feet.
The average new building size approved during the study period is over twice the square
footage and taller in height (up to 5 stories in the downtown) than the typical residential
project, which is generally 2-stories and approximately 7,500 to 8,000 square feet. The
disparity in size and height could create compatibility issues if located next to or in close
proximity to residential properties. Larger scale projects have the potential for adverse
noise, traffic, parking, aesthetic, privacy, light and air, and shade and shadow impacts on
nearby residential uses.
The following discussion provides a summary of development activity in the City by area.
“Downtown” Area Commercial Districts
In the Bayside Commercial District (BSC), new buildings approved during the study period
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averaged 19,263 square feet. Additions to existing buildings averaged 8,226 square feet.
New buildings that were approved include the recently completed 28,372 square foot retail
building at 214 Wilshire Boulevard and the 22,853 square foot, mixed-use building at 1207
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4 Street. These projects were administratively approved.
The C3 zoning district has been an active area of the City for administratively approved
development during the study period. The predominant building type consists of a mixed-
use development with commercial space at the ground floor (less than 2,000 square feet)
and residential units on the upper floors. Approved buildings averaged 37,812 square feet.
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Examples include the projects located at 1519 6 Street (45,907 square feet), 1535 6
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Street (55,303 square feet) and 1530 7 Street (59,908 square feet). These projects have
used the floor area bonus afforded the residential component of mixed-use developments
in commercial districts. The floor area bonus was instituted by the City to encourage
development of multi-family housing. The physical development at these sites far exceeds
the 30,000 square foot C3 threshold because the residential square footage was
calculated at 50% for development review purposes. Additions to buildings during the
study period averaged 10,477 square feet.
The C3C district had one approved project during this time frame. This 25,701 square foot,
mixed-use project contained ground floor commercial and 28 one bedroom apartment units
on the upper floors.
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Other Commercial Districts
In the other commercial districts, the approved projects during the study period have
typically not been as large, but have still been significant. With the exception of a private
school project in the BCD Broadway Commercial District and an office project in the C5
Special Office District, the largest of the developments have also included some
component of residential use.
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In the BCD district, the average approved new building contained 9,908 square feet
(there were no additions to buildings during the study period). One of the larger
projects was an 11,250 square foot mixed-use building.
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In the C2 Neighborhood Commercial District, approved buildings averaged 6,739
square feet with one building addition of 1,947 square feet. The largest approved
projects were mixed-use commercial/residential projects at 720 Montana Avenue and
1230 Montana Avenue. Both projects were just under 11,000 square feet (the
development review threshold before adoption of Ordinance 1978).
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The largest new building projects in the C4 Highway Commercial District during the
study period were 2 housing projects – a 20-unit, 19,592 square foot affordable
housing project at 708 Pico Boulevard and a 22-unit, 14,685 square foot apartment
project at 1005 Pico Boulevard. Both projects were far larger than the 8,149 square foot
average new building approved during the study period. There was a single building
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addition approved during the study period of 2,675 square feet.
The remaining commercial districts have had less development activity during the study
period. In the CM, C5, C6 and CP districts, a total of 5 new buildings were administratively
approved with an average size of 9,979 square feet. Two building additions were approved
in the CM and CP districts which averaged 2,417 square feet. Although considered a
residential district by Code, the RVC district is intended to provide commercial visitor
serving uses. During the study period, a 3,237 square foot addition to “The Lobster”, was
approved.
Industrial District activity
New buildings approved in the M1 Industrial Conservation and LMSD Light Manufacturing
and Studios Districts were also analyzed. Three new buildings were approved in the M1
district averaging 7,083 square feet; however, that average was made significantly higher
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by an 11,352 square foot industrial/office building approved at 1607 16 Street. There was
a single building addition approved in the M1 during the study period of 2,198 square feet.
The average new building approved in the LMSD district was 1,135 square feet; however,
building additions averaged 8,843 square feet with the average increased dramatically due
to a 21,341 square foot production facility expansion at 3301 Exposition Boulevard.
Development Review Threshold Modifications
The Council directed staff to assess the possibility of lowering the development review
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thresholds to 5,000 square feet for projects located adjacent to residential districts in order
to provide for public review and comment on development projects and to require
environmental review under CEQA.
Requiring a Development Review Permit subjects projects to the provisions of CEQA.
However, CEQA also provides for “Categorical Exemptions” to environmental review for
certain classes of projects which are generally smaller in size and judged to have no
significant impact on the environment. Section 15303(b) exempts multi-family projects of 6
units or less in urbanized areas such as Santa Monica. Section 15303(c) exempts
commercial projects that are 10,000 square feet or less in floor area if the project does not
use significant amounts of hazardous materials. Therefore, although a Development
Review Permit will require a project to comply with CEQA, no environmental analysis will
be prepared unless a proposed commercial or industrial project exceeds 10,000 square
feet in floor area. There are exceptions to these exemptions, however. CEQA Section
15300.2 does not exempt projects from environmental review that:
1. are located in an environmentally sensitive area;
2. are successive similar projects in the same place;
3. produce significant effects due to unusual circumstances;
4. significantly affect a scenic highway;
5. are located on a hazardous waste site; and
6. significantly affect an historical resource.
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With the exception of the C2 district along Montana Avenue, a 5,000 square foot
development review threshold is a significant reduction from those currently in place. As
shown in Attachment C, the existing thresholds range from 11,000 square feet in the C2
districts (other than Montana Avenue) and the CM Main Street Commercial District, to
30,000 square feet in the RVC (along Ocean Avenue), BSC, C3, C3C, C5, C6, M1 and
LMSD districts.
Lowering development review thresholds to 5,000 square feet would have resulted in a
Planning Commission public hearing for 42 of the 69 Administrative Approvals (61%)
issued during the study period in the RVC, commercial and industrial districts.
Commercial Districts Abutting Residential Areas and Industrial Districts
A Development Review threshold of 30,000 square feet can lead to projects that are not
compatible with the neighborhood context of nearby residential districts and have not been
subject to public review and comment. The Development Review process evaluates a
project’s location, size, massing and placement on the site to ensure that the development
is compatible with and relates harmoniously to the surrounding neighborhood. Reducing
the Development Review thresholds will facilitate close review of these issues and enable
the public to participate in this analysis. Staff believes this will result in new development
that provides a more sensitive transition between commercial and residential uses. The
typical lot size in the commercial zones is 7,500 square feet. A DR threshold of 7,500
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square feet is appropriate for the RVC, the commercial districts that abut residential
districts and in the industrial districts (See Attachment C). Commercial projects 7,500
square feet or less in floor area are smaller scale developments which generally do not
produce adverse impacts on nearby residential neighborhoods such as noise, traffic,
parking, aesthetic, privacy, light and air, and shade and shadow impacts and are generally
compatible in scale with nearby multi-family developments, where the typical 5 to 7 unit
project approved during the study period ranged from approximately 5,400 square feet to
8,200 square feet. The proposed threshold would allow up to 1.0 FAR, or a one story
building occupying the entire lot or a two story building occupying a portion of the lot. This
level of development is consistent with the scale of existing older developments.
Staff also recommends a 7,500 square foot DR threshold for the industrial districts. The
LMSD and M1 zoning districts include large, sometimes under utilized parcels which are
likely to be redeveloped in the near future. There has been a trend in recent years of
production studio and post production facility development in these areas. A 7,500 square
foot DR threshold will provide for a more comprehensive review of these projects so that
the impacts associated with the new uses can be assessed.
Although commercial and industrial projects that are 10,000 square feet or less are exempt
from the provisions of CEQA, staff believes that public participation and Planning
Commission review is warranted to ensure the siting and placement of new development is
compatible with the existing neighborhood context.
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Within the commercial districts abutting residential areas (RVC, BCD, C2, C4, C5, C6, CM,
and CP) and industrial districts (M1 and LMSD), a 7,500 square foot DR threshold would
have required 13 of the 39 projects (33%) approved during the study period to obtain a
Development Review Permit. A 5,000 square foot development threshold would have
required development review for 17 of the 39 projects (44%).
Downtown Areas
The objectives of the Land Use Element require that the City’s policies “reinforce the
downtown area as the focus of the City, supporting the greatest concentration of activity”.
Consistent with this policy objective, the Zoning Ordinance permits higher development
intensity in this area, therefore, a higher development review threshold is warranted.
Staff does not recommend development review threshold reductions in the downtown
districts where larger developments are permitted by Code, are more in scale with existing
development and are not in close proximity to residential neighborhoods. These areas
include the BSC, C3, and C3C districts. Land Use Element Objective 1.3 states that the
City’s land use policies should “Reinforce Downtown as the focus of the City, supporting
the greatest concentration of activity”. Land Use Element Policy 1.3.5 supports this
objective by stating that City’s policies should “Encourage residential uses in Downtown
other than at the ground floor street frontage and encourage the provision of neighborhood
commercial uses to serve the Downtown residential community”. This policy envisions
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mixed-use developments with ground floor commercial uses and residential uses above,
with residents living and working in the downtown. Such developments would have positive
impacts on parking, traffic and vehicle circulation.
An alternative to reducing the development review thresholds in the commercial districts
abutting residential districts and industrial areas would be to eliminate the FAR bonuses
for residential components and/or eliminate the discount afforded residential uses for
development review purposes. The development standards in the BCD, C2, C4, C6 and
CM commercial districts allow for increased density through FAR bonuses when at least
30% of a project includes residential uses. In the RVC, C2, C4, C6, CM and CP districts,
residential square footage is counted at 50% for development review purposes. These
provisions of the Code reflect the City’s policy to encourage housing development,
particularly in mixed-use projects. The vast majority of projects that used these bonuses
during the study period (13 of 17 projects) occurred in the downtown area, where
reductions in the DR thresholds are not recommended. Without these incentives,
developers may choose to develop commercial projects rather than mixed-use or
residential projects. Staff does not recommend eliminating or modifying these Code
provisions in light of the City’s need for housing.
Workload Impacts
It is not anticipated that lower DR thresholds will lead to fewer applications, but fewer
projects could be approved administratively. The Planning Commission caseload would
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increase and the discretionary projects would require more time to process. Development
Review permit processing involves more detailed project analysis, including, in some
cases, environmental review which could range from an Initial Study/Negative Declaration
to an Environmental Impact Report depending upon the size, scope and location of the
project. Using the proposed 7,500 square foot DR thresholds, approximately 74% (29 of
39) of the projects approved during the study period in the affected districts would not
require environmental analysis pursuant to exemptions provided by the CEQA guidelines
based upon size (10,000 square feet or less) and use (affordable housing). Administrative
Approvals require on average approximately 3 months to review and process for approval.
Development Review Permits require from 9 months to more than a year to process
depending upon the level of environmental analysis required for the project. While all
projects already require staff work and analysis, lowering the DR thresholds will
incrementally increase staff workload and project processing timeframes.
CONCLUSION
The proposed emergency interim ordinance is necessary to allow for a comprehensive
planning process that will address the issue of compatibility of new projects through
permanent modifications to development review thresholds in the commercial corridors and
industrial districts of the City. The proposed emergency interim ordinance will not reduce
the size of any potential projects as allowable floor areas are unaffected. Rather, the
emergency interim ordinance will change only the process by which some projects are
reviewed and approved. By lowering the discretionary review thresholds, the emergency
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interim ordinance will ensure that a larger number of new developments in the City,
particularly those which have the potential to be incompatible with existing neighborhoods,
will be reviewed and approved within a public process and will be subject to the provisions
of CEQA.
BUDGET/FINANCIAL IMPACT
The recommendation presented in this report could have incremental budget impacts in
that it could require additional staff and related resources in the long term. While it is not
possible to predict the exact impacts at this time, staff will evaluate the issue in the context
of FY 01-02 budget discussions.
PUBLIC NOTIFICATION
As an emergency interim ordinance, public notification is not required prior to the public
hearing. However, notice of the public hearing was published in the Westside Weekly and
mailed to all neighborhood groups and interested persons contained in the City’s
comprehensive mailing list.
RECOMMENDATION
It is respectfully recommended that the City Council adopt the emergency interim
ordinance included in Attachment A.
Prepared by: Suzanne Frick, Director
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Jay M. Trevino, AICP, Planning Manager
Amanda Schachter, Principal Planner
Paul Foley, Associate Planner
Planning and Community Development Department
Attachment: A. Proposed Emergency Interim Ordinance
B. Notice of Public Hearing
C. Development Review Thresholds by Zoning District
D. Administrative Approvals Approved – January, 1996 to July, 2000 (by
Zoning District)
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