SR-401-000
PCD:SF:AA:f:\plan\admin\ccreport\da guidelines.doc
Council Mtg: December 16, 2003 Santa Monica, California
TO: Mayor and Councilmembers
FROM: City Staff
SUBJECT: General Guidelines for Development Agreement Applications
INTRODUCTION
This report recommends that the City Council approve the attached general guidelines
for development agreement applications.
BACKGROUND
On November 11, 2003, the City Council discussed the history and purpose of
development agreements in Santa Monica, as well as relevant local and state law. The
previous staff report is attached for reference. Following its discussion, Council
identified the types of projects and situations that would generally warrant Council
consideration for a development agreement, as well as expectations for public
participation.
DISCUSSION
While the municipal code allows any applicant to apply for a development agreement,
staff will use the attached guidelines to help prospective applicants understand whether
a proposed project would likely be considered appropriate for the development
agreement process.
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BUDGET/FINANCIAL IMPACT
The recommendation presented in this report does not have any budget or fiscal impact.
RECOMMENDATION
It is recommended that the Council approve the attached general guidelines for
development agreements.
Prepared by: Suzanne Frick, Director, Planning and Community Development
Andy Agle, Assistant Director, Planning and Community Development
Attachments:
A. Proposed General Guidelines for Development Agreements
B. November 11, 2003 Staff Report
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Attachment A
General Guidelines for Development Agreements
Development agreements are generally reserved for projects proposed
for the City’s commercial and industrial districts that involve at least one
of the following project attributes:
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Complex multi-phase or multi-site projects;
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Complex projects of significant scope and scale (at least 50,000
square feet or 50 residential units);
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Complex projects that are expected to provide significant public
benefits; or
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Projects involving extraordinary conditions or circumstances that
make code compliance and text amendments inappropriate.
Prospective development agreement applicants are expected to host at
least one broadly noticed community meeting prior to initial
consideration of the project concept by the Planning Commission and
City Council.
Attachment B
November 11, 2003 Staff Report
Council Mtg: November 11, 2003 Santa Monica, California
TO: Mayor and Councilmembers
FROM: City Staff
SUBJECT: Policy Discussion on Development Agreement Applications
INTRODUCTION
This report recommends that the City Council discuss and provide direction to staff on
the scope and size of projects eligible for development agreements.
BACKGROUND
Both state and local law govern development agreements. In general, state law
authorizes cities to make development agreements and to adopt procedures for doing
so. Government Code Section 65856. State law also establishes, among other things,
that the approval of a development agreement is a legislative act and that no findings
are necessary to reject a proposed development agreement.
In Santa Monica, the Municipal Code establishes application and processing
procedures and sets forth requirements for monitoring, modifying and terminating
development agreements. SMMC Chapter 9.48. The code provisions do not limit
development agreements to specific classes of projects. Thus, under current law, an
application may be submitted for any type of project.
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After a submission, the code requires the Planning Director to prepare a staff report
including a recommendation as to whether the City should approve, reject or seek to
modify the proposed agreement. The code further specifies that the Planning
Commission, after conducting a hearing, shall formulate a recommendation to the
Council. That recommendation must state whether the proposed agreement would
meet certain general criteria set forth in the code such as consistency with the General
Plan, compatibility with other uses, and furtherance of the public health, safety and
welfare.
After conducting a public hearing, the City Council may accept, modify or disapprove
the agreement. The Council's discretion is unfettered except that an agreement may
not be approved if it conflicts with the General Plan or any specific plan. Thus, the
Council has absolute discretion to disapprove any development agreement.
The City has entered into eleven development agreements over the last twenty years.
The agreements consisted of a range of residential and commercial projects. Some of
the common characteristics of projects warranting a development agreement were
multi-phase developments, complex commercial projects, residential projects on
multiple sites, or mixed-use residential and commercial projects. The smallest
commercial project is a 54,000 square foot mixed use project located at 1541-51 Ocean
Avenue, and the smallest residential project was 52 condominiums and apartments
located on two separate sites.
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Development agreements are among the least common land use applications reviewed
by the City Council and the most staff intensive. Because development agreements
override the Zoning Ordinance, they are an attractive way to permit development which
otherwise would be inconsistent with the Zoning Ordinance. Because of this, the City
has been selective about the type of project qualifying for a development agreement.
There is a growing interest from applicants in the use of development agreements for
project processing. Because of this, staff is requesting Council direction on the type of
project that should be eligible for a development agreement.
DISCUSSION
An excellent new publication by the Institute for Local Self Government in Sacramento –
Development Agreement Manual: Collaboration in Pursuit of Community Interests
(2002), provides some relevant information. The entire manual is available on-line at
http://www.ilsg.org/userfiles/godoc/5116.FinalDevAgreement4-5-02.PDF. The following
excerpts are germane:
What Are Development Agreements?
(p. 9)
Development agreements are contracts negotiated between project proponents
and public agencies that govern the land uses that may be allowed in a particular
project.Although subject to negotiation, allowable land uses must be consistent
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with the local planning policies formulated by the legislative body through its
general plan, and consistent with any applicable specific plan.
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Neither the applicant nor the public agency is required to enter into a
development agreement. When they do, the allowable land uses and other terms
and conditions of approval are negotiated between the parties, subject to the
public agencies’ ultimate approval. While a development agreement must
advance the agencies’ local planning policies, it may also contain provisions that
vary from otherwise applicable zoning standards and land use requirements.
The development agreement is essentially a planning tool that allows public
agencies greater latitude to advance local planning policies, sometimes in new
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and creative ways. While a development agreement may be viewed as an
alternative to the traditional development approval process, in practice it is
commonly used in conjunction with it. It is not uncommon, for example, to see a
project proponent apply for approval of a conditional use permit, zone change
and development agreement for the same project.
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See Cal. Gov’t Code §65864 and following
2
See Cal. Cov’t Code §65867.5
What Does a Development Agreement Cover?
(p. 26)
MENTGREEMENT
R?
COVE
Permitted uses of the property;
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Density or intensity of use;
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Maximum height and size of proposed buildings;
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Provisions for reservation or dedication of land for public purposes;
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Terms and conditions relating to financing of necessary public
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improvements, as well as provisions for subsequent reimbursement for
that financing, as appropriate;
Timeframes for commencement and completion of construction, or any
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phases of construction;
Subsequent discretionary approval provisions, as long as those approvals
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do not prevent development of the project as described in the agreement;
and
The duration of the agreement
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The Advantages And Disadvantages Of Development
Agreements
(p. 11)
Development agreements have three defining characteristics:
They allow greater latitude than other methods of approval to advance
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local land use policies in sometimes new and creative ways;
They allow public agencies greater flexibility in imposing conditions and
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requirements on proposed projects; and
They afford project proponents greater assurance that once approved,
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their projects can be built
Although these characteristics can be advantageous, they can also present
challenges. The purpose of this chapter is to discuss potential advantages and
disadvantages of development agreements, from the perspective of both the
public agency and project proponent.
Advancing Land Use Policies
(p. 11)
Because development agreements are themselves ordinances, they may
supersede existing land use regulations as long as they are consistent with the
general plan and any applicable specific plan. As a result, they can afford the
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public agency and project proponent greater latitude concerning allowable land
uses in a particular instance. However, there are potential advantages and
disadvantages associated with having this flexibility.
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Cal. Gov’t Code § 65867.5.
See
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Potential Advantages: The Ability To Better Implement Planning
Policies
(p. 12)
From a planning perspective, development agreements have been instrumental
in allowing creative and award-winning land use projects because the
agreements can facilitate projects that would not have been allowed under
otherwise applicable zoning regulations. The approval of creative land use
concepts — and the construction of resulting projects — have advanced the state
of urban planning, and allowed public agencies to better combat the visual and
aesthetic impacts of “cookie-cutter” development.
In a similar vein, there are instances in which literal compliance with zoning
ordinance provisions can thwart promotion of general plan policies. For example,
the general plan may encourage the existence of open space, whereas the
applicable zoning district does not allow sufficient density to accommodate the
clustering of residential units necessary to accommodate an open space
component.
There may also be instances in which the legislative body wishes to promote
unwritten policies, such as those involving growth management. As long as the
project is consistent with the local planning policies formulated by the legislative
body through its general plan, the development agreement can provide greater
latitude to incorporate land use concepts and components that are tailored
specifically to address particular community concerns.
In each of these cases, the ability to vary from strict adherence to otherwise
applicable zoning provisions can help ensure that the public agency’s land use
policies are being advanced, in sometimes new and innovative ways. These
advantages are shared by the public agency and project proponent alike.
Potential Disadvantages: May Promote Bad Planning
(p. 14)
The latitude afforded the parties through use of a development agreement may
also have potential disadvantages. For example, the agency’s staff and
legislative body may become convinced that, in exchange for the significant sales
tax revenue the agency is likely to receive from a particular project, or in
consideration of the fact that the project proponent is willing to construct a new
city park or other significant public amenity, the agency should agree to
compromise its planning standards in a manner that could reduce the quality of
life in the community. The pressure to compromise may be especially great in the
case of a “friendly developer” who has a popular presence in the community.
From the project proponent’s perspective, it is possible that the legislative body
may decide to disallow uses that would otherwise be allowed, and which are
appropriate from a conventional planning perspective.
The suggestions that appear in this manual are intended to help avoid misusing
development agreements. They are based on the premise that from the outset,
the planning policies and objectives that have been embraced by the community
through adoption of the general plan, and those included in any applicable
specific plan, should be an integral part of the discussions and negotiations
between the parties to a development agreement.
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By identifying applicable planning policies early on, and continuing to use them
as yardsticks in determining what land uses are appropriate, the parties should
be able to avoid unacceptable compromises when negotiating development
agreements.
Imposing Conditions
(p. 14)
Development agreements provide public agencies greater flexibility in imposing
requirements on proposed development, such as development conditions,
exactions and fees, because constraints and uncertainties that affect a local
agency’s ability to unilaterally impose such requirements do not apply to mutually
agreed upon development agreement provisions.
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See
Cal. Gov’t Code § 66000(b) (excluding “fees collected under development agreements” from the
type of fee covered under the Mitigation Fee Act).
Conclusion
Entering into a development agreement is a significant undertaking involving staff from
the City Attorney’s Office, Planning and Community Development and other City
departments as required. In the past, the process has been reserved for complex,
multi-phase projects. If this becomes a more commonly employed method for project
processing, it will impact staff resources and Council agenda management. It has the
potential to make planning decisions a patchwork of ad hoc uses, undermining the
framework of general plan and zoning polices.
Staff is requesting Council direction on the following issues:
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Size of an eligible project. Examples include number of units or square
footage.
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Type of eligible project. Examples include single family, apartments,
condominiums, office, retail or mixed use.
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Location of eligible projects. Examples include single family, multiple
family, commercial or industrial districts.
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Rationale for development agreement vs. standard review.
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BUDGET/FINANCIAL IMPACT
The recommendation presented in this report does not have any budget or fiscal impact.
RECOMMENDATION
It is recommended that the Council discuss the scope and type of projects that should
be considered eligible for a development agreement, providing direction to staff when
developers should pursue a development agreement.
Prepared by: Suzanne Frick, Director, Planning and Community Development
Department
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