SR-407-000-06 (3)~_ . .
City Council Report
~ City of
Santa Monica~
City Council Meeting: May 25, 2006
Agenda Item: ~~
To: Mayor and City Council
From: Marsha Jones Moutrie, City Attorney
Subject: Ordinance Amending the Affordable Housing Production Program
Recommended Action
In response to a City Council direction, Staff recommends that the City Council review
the attached ordinance amending Chapter 9.56 of the Municipal Code, the Affordable
Housing Production Program ("AHPP"), to require the onsite or offsite development of
affordable housing units in conjunction with new multifamily developments of four or
more units. Staff also recommends that the City Council direct staff to modify the
proposed ordinance, including limiting the onsite requirement to condominium projects,
limiting the ordinance's application to specified zoning districts, such as multi-family
residential zoning districts, and adjusting the income eligibility threshold for affordable
units.
Executive Summary
Council directed preparation of the attached ordinance (Attachment A) which would
amend Chapter 9.56 of the Municipal Code to restrict the circumstances in which an
Affordable Housing Fee may be paid and to require the onsite or offsite development of
affordable housing units in conjunction with new multifamily developments of four or
1
more units, with limited exceptions. The proposed ordinance would establish three
options for developers: (1) 20% of the total number of units in developments of four to
fifteen units are affordable to low income households with this percentage increasing to
25% for developments greater than fifteen units, or (2) 100% of the units are restricted
to moderate income households, or (3) the affordable units are constructed offsite from
the subject development provided, in part, that the number of units constructed is twice
the number that would have been constructed onsite. However, based on legal
considerations, staff recommends that the Council not mandate the production of
affordable rental units in this manner and that the Council consider other modifications
to the proposed ordinance as detailed below.
Discussion
On May 10, 2005, staff reported to Council on its evaluation of the Affordable Housing
Production Program and on various alternatives for updating this program to help attain
the goals of Proposition R. That report included a summary of several important legal
considerations. A copy of the report is attached as Attachment B.
On May 17, 2005, the City Council directed staff to prepare for Council consideration
an ordinance amending the Affordable Housing Production Program (Section 9.56 of
the Municipal Code) to require that multifamily developments satisfy their obligation to
contribute to affordable housing by constructing affordable units within a given
development (onsite) or offsite in another multifamily development. The City Council
direction established the parameters of the proposed ordinance.
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A draft ordinance consistent with this Council direction is attached. It provides
developers of multifamily housing of four or more units with three options to satisfy their
affordable housing obligation under the Affordable Housing Production Program.
The first option establishes that for developments of four to fifteen units, 20% of the total
units shall be affordable to low income households, and in developments of 16 units or
greater, 25% of the total units shall be affordable to low income households. "Low
Income" is defined as those households whose income does not exceed 60% of the Los
Angeles County median income, as established by the United States Department of
Housing and Urban Development ("HUD"). In calculating the number of affordable units
required in a development, any fraction of 0.75 or greater will be rounded-up and
counted as a whole unit. For calculations which result in a fraction of 0.74 or less, the
developer may elect to pay a fee for that fractional unit based on the City's average cost
to develop a unit of housing affordable to low-and moderate income households. The
City's affordable housing unit development cost is presently approximately $240,000 per
unit. This fee will be established by resolution of the City Council and adjusted annually
to reflect changes in land costs and construction costs. Finally, in the event the
developer has the option of paying a fee for a fraction of a unit (0.74 or less), this fee
may be eliminated in exchange for constructing the required affordable units with three
or more bedrooms rather than the minimum two-bedroom requirement currently
imposed. A table is provided as Attachment C showing the number of affordable
housing units required pursuant to this option for developments of forty units or less.
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The second option permits a developer to restrict all of the units in a development to
moderate income households. "Moderate Income" is defined as those households
whose income does not exceed 100% of the Los Angeles County median income, in
limited equity ownership projects or 80% of the Los Angeles County medium income in
rental projects, as established by HUD. If this option is chosen, the project is exempt
from the requirement to provide low income units.
Finally, the third option allows developers to satisfy their affordable housing obligation
by constructing the affordable units offsite from the subject development, so long as two
conditions are met. One condition requires that the offsite units be built within one-
quarter mile of the subject development (and in Santa Monica). The other condition
requires that the number of offsite affordable units be twice the number of onsite
affordable units that otherwise would have been required in the subject development.
Developers are not required to pay a fee for any fractional unit.
In addition to the three options described above, developers of multifamily housing of
two or three units may also elect to meet their entire obligation by paying an affordable
housing fee or by acquiring land for affordable housing as currently authorized by the
Affordable Housing Production Program.
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Alternatives
In considering the proposed ordinance, legal parameters should be borne in mind. For
example, as explained in the May 10th staff report, the language of the Gosta-Hawkins
Rental Housing Act appears to preclude cities from controlling rents on inclusionary
housing [absent a contractual agreement to the contrary]. Additionally, the state's
Housing Element Law establishes restrictions. For instance, state law imposes
procedures for amending housing elements, including requiring review of proposed
amendments by the California Housing and Community Development Department.
Additionally, when housing elements are being adopted or amended, state law
authorizes state scrutiny of local laws and policies which operate as "constraints" on
housing production. Opponents of the ordinance have urged that it would, if adopted,
constitute a de facto amendment of the City's Housing Element. As such, they contend
that the City must first formally process a Housing Element amendment and undertake
a constraint analysis as part of that amendment process prior to adopting the ordinance.
Staff has assessed both the legal constraints and the comments from opponents of the
ordinance. Based upon these considerations, staff recommends that the Council
consider declining to mandate production of affordable rental units and, instead, limit
production mandates to condominium projects. Additionally, Council may wish to
consider whether requirements should vary in different areas of the City and whether
the income eligibility threshold for affordable units should be adjusted. To aid in
Council's consideration of these options, staff has completed a preliminary assessment
of the potential financial impact of on-site affordable units on condominium development
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in the R2 district based on four illustrative prototypes. (Attachment D). Overall,
amending the existing law more selectively will significantfy reduce the likelihood of
successful chal.lenge to the Council's action. Staff is prepared to revise the proposed
ordinance at the May 25t" meeting if Council wishes to pursue any of these alternatives.
Budget/Financial Impact
The amount of the Affordable Housing Fees collected pursuant to the Affordable
Housing Production Program would likely decrease subsequent to the implementation
of the proposed ordinance.
Prepared by: Marsha Jones Moutrie, City Attorney
Attachments: A: Proposed Ordinance
B: May 10, 2005 Staff Report
C: Affordability Requirements Table
D: Financial Analysis of Condominium Prototypes
E: Public Notices
f:\atty~nuni\strpts~njm\affordablehousingreport3.doc
6
Approved: Forwarded to Council:
ATTACHMENT A
F:atty\muni\laws\barry\affordablehousingamendord5-25-06-1.doc
City Council Meeting 05-25-06 Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA AMENDING SANTA MONICA MUNICIPAL CODE SECTIONS
9.56.020, 9.56.030, 9.56.040, 9.56.050, 9.56.060 AND 9.56.070 TO MODIFY THE
OPTIONS FOR MEETING AFFORDABLE HOUSING REQUIREMENTS
WHEREAS, Santa Monica is a coastal city in a prime location, being bordered by
the City of Los Angeles to the north, east and south; and
WHEREAS, the combination of a scenic oceanside location, excellent climate,
and the ready availability of urban facilities, services and entertainment make Santa
Monica an extremely desirable place to live; and
WHEREAS, land area of the City is very small - approximately eight square
miles; and
WHEREAS, Santa Monica is already a fully built-out city, with only thirty-three
vacant residential parcels and a population of approximately ninety-one thousand five
hundred; and
WHEREAS, Santa Monica's population density, eleven thousand two hundred
persons per square mile, is the second highest among neighboring and nearby
jurisdictions, and is the densest among coastal communities in Los Angeles County;
and
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WHEREAS, the vast majority of new market rate multi-family development in the
City is not affordable, with the average cost of a new market rate condominium in the
City is now approaching $1,200,000.00; and
WHEREAS, market conditions, including the high cost and lack of residential
land, construction costs, and the availability and cost of financing, make the
development of affordable housing in the City extremely difficult; and
WHEREAS, the vast majority of housing units have been and will continue to be
produced by the private housing industry; and
WHEREAS, new market rate multi-family housing in Santa Monica
accommodates upper-income households almost exclusively because of the high rent
or purchase price required to occupy it; and
WHEREAS, because the City is fully built-out, land available for residential
development in the City is extremely limited; and land which could be used for
development of housing for affordable households is being depleted by development of
high cost housing resulting in a continued rise in land costs; and
WHEREAS, continued new residential development which does not include or
contribute toward the cost of affordable housing development will only serve to further
exacerbate the current affordable housing shortage; and
WHEREAS, the lack of affordable housing production by market-rate
development has a direct impact upon the health, safety, and welfare of the residents;
and
WHEREAS, the failure to provide adequate affordable housing for lower-wage
workers can force these workers to live in less than adequate housing within the City,
2
pay a significantly disproportionate share of their incomes to live in adequate housing
within the City, or commute ever-increasing distances to their jobs from housing located
outside the City; and
WHEREAS, requiring developers to assist in the production of affordable housing
is also consistent with the City's long-standing commitment to achieve and maintain a
suitable living environment including decent housing for persons at all economic levels;
and
WHEREAS, this municipal commitment conforms with State and Federal policies
and is a principal goal of the City's 2000-2005 Housing Element Update and the 2005-
2010 Consolidated Plan; and
WHEREAS, California's Housing Element law requires each city and county to
develop local housing programs designed to address its "fair share" of existing and
future housing needs for all income groups; and
WHEREAS, the City's 2000-2005 Housing Element Update establishes the City's
fair share at 2,208 housing units of which 1,281 should be affordable; and
WHEREAS, the City has historically effectuated this commitment to affordable
housing through extraordinary efforts manifest in various City laws, poticies and
programs; and
WHEREAS, for instance, the City's voters have adopted initiative measures
which strive to maintain and promote affordable housing in the City; the Rent Control
Charter Amendment, adopted in 1979, has as its primary purpose the protection of
affordable housing and has historically been the City's most important legislative tool for
maintaining a supply of affordable housing; and, similarly, Proposition R, adopted by the
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voters in 1990, mandates that thirty percent of all new multi-family housing units
constructed in the City each year be affordable; and
WHEREAS, the City's zoning laws and policies also include substantial
incentives for the production of affordable housing, including height and density
bonuses and reduced parking requirements; and
WHEREAS, the City operates a number of programs which facilitate the
production of affordable housing, including loans to private, non-profit agencies to
created through acquisition and rehabilitation, or construct new affordable housing units;
and
WHEREAS, the Housing Element Update catalogues a dozen funding sources
that the City utilizes to assist in the development and rehabilitation of affordable housing
totaling almost $70,000,000.00; and
WHEREAS, despite this significant commitment by the City, the City's total
housing needs exceeds its available resources and the City's ability to meet these
needs; and
WHEREAS, despite the City's prime location and high real estate values, the City
has historically been successful in maintaining economic diversity; and
WHEREAS, based on census data in the 2000-2005 Housing Element Update,
23.0 percent of the City's households were very low income, 16.1 percent were low
income, 20.7 percent were moderate income, and 40.1 percent were upper income; and
WHEREAS, fifty-three percent of households residing in rent-controlled
apartments in the City were very low- and low-income; and
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WHEREAS, this diversity is an essential element of the City's character; it sets
the City apart from all other similarly situated coastal cities in California; and
WHEREAS, notwithstanding the City's ongoing commitment and efforts, changes
in State and Federal law and market conditions are making it increasingly difficult for the
City to ensure a continued supply of affordable housing; and
WHEREAS, in 1986, the State enacted the Ellis Act which enables a property
owner to cease operating property as residential rental property and, more recently, in
1995, the State enacted the Costa-Hawkins Rental Housing Act which eliminated the
limits on the rents which a property owner may charge when re-renting voluntarily
vacated units; and
WHEREAS, between 1986 and 2005, over sixteen hundred controlled rental
units have been permanently withdrawn from the rental market pursuant to the Ellis Act;
and
WHEREAS, Costa-Hawkins has had a devastating impact on the City's
affordable housing stock because between 1999 and 2005, 13,183 controlled rental
units, or about 48 percent of the total, have been rented at market rates; and
WHEREAS, 8,444 of these units had formerly been affordable to low-income
households including 5,351 units which had formerly been affordable to very low-
income households; and
WHEREAS, the median monthly rents upon re-rental have increased to
$1,300.00 from $735.00 (77%) for one bedroom units; $1,748.00 from 946.00 (85
percent) for two bedroom units and $2,248.00 from $1,192.00 (89 percent) for three or
more bedroom units; and
5
WHEREAS, had the 13,183 units not been rented at market, the median MAR's,
including the 1999-2005 general adjustment, for these units would have been affordable
to households making 80% of inedian income; and
WHEREAS, none of the post-increase-medians are affordable at this income
category; and
WHEREAS, after these increases, the median Maximum Allowable Rents
("MARs") of the 0-bedroom units are only affordable at 100% of inedian and above; and
WHEREAS, the median MARs of 1-bedroom units are only affordable to
households at 120% of inedian and above while the median rents for 2 and 3-bedroom
units are not even affordable to that income level; and
WHEREAS, this law is having and will continue to have a significant impact on
the City's supply of affordable housing; and
WHEREAS, there is an extremely low vacancy rate for the existing affordable
rental housing stock; and
WHEREAS, according to the annual report to the City Council concerning the
City Affordable Housing Production Program and Proposition R, only 17% of the units in
multifamily developments completed during FY03/04 were affordable; and
WHEREAS, based on the building permits that have been issued for new
multifamily developments, only 6% of these units will be affordable; and
WHEREAS, Section 9.56.150 of the Affordable Housing Production Ordinance
provides that when the provisions of Proposition R have not been met, the City Council
shall take action to ensure that its provisions are met in the future; and
6
WHEREAS, reductions in State and federal funding for affordable housing,
changes in these programs, and the potential expiration of controls on rents in federally-
assisted projects all hinder the City's ability to provide or promote affordable housing
threatening the City's existing affordable housing stock; and
WHEREAS, the decline in the affordability of this housing stock is further
exacerbated by the production of luxury market rate housing; and
WHEREAS, between 1998-2005, 62% of new residential development has
occurred in the City's commercial districts; and
WHEREAS, 84% of the residential units with building permits issued as of
December 2005 will be located in the City's commercial districts; and
WHEREAS, given current economic conditions and the general desirability of the
City; the price of new housing will only continue to increase, thereby further
exacerbating the growing shortage of affordable housing in the City; and
WHEREAS, this Affordable Housing Production Program will benefit the City as a
whole since each development which contributes to affordable housing through the
provisions of this Chapter augments the City's housing mix, helps to increase the supply
of housing for all economic segments of the community, addresses the affordable
housing need generated by the development, helps meet the voter mandate expressed
in Proposition R and thereby supports a balanced community which is beneficial to the
public health, safety and welfare of the City,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
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SECTION 1. Santa Monica Municipal Code Section 9.56.020 is hereby amended
to read as follows:
9.56.020 Definitions.
The following words or phrases as used in this
Chapter shall have the following meanings:
Affordable Housing Fee. A fee paid to the City by a
multi-family project applicant pursuant to Section 9.56.070 of
this Chapter to assist the City in the production of housing
affordable to very low-, low-, and moderate-income
households.
Affordable Housing Unit. A housing unit developed
by a multi-family project applicant pursuant to Sections
9.56.050 or 9.56.060 of this Chapter which will be affordable
to very low-, low-, or moderate-income households.
Affordable Housinq Unit Development Cost. The
City's averaqe cost to develop a unit of housing affordable to
low- and moderate income hauseholds.
Dwelling Unit. One or more rooms, designed,
occupied or intended for occupancy as separate living
quarters, with full cooking, sleeping and bathroom facilities
for the exclusive use of a single household. Dwelling unit
8
shall also include single-room occupancy units as defined in
Santa Monica Municipal Code Section 9.04.02.030.790.
Floor Area. Floor area as defined in Santa Monica
Municipal Code Section 9.04.02.030.315.
HUD. The United States Department of Housing and
Urban Development or its successor.
Income Eligibility. The gross annual household
income considering household size and number of
dependents, income of all wage earners, elderly or disabled
famify members, and afl other sources of household income.
Industrial/Commercial District. Any district
designated in the Santa Monica Zoning Ordinance as a
commercial or industrial district.
"Low," "Very Low," and "Moderate" Income
Levels. Income levels determined periodically by the City
based on the United States Department of Housing and
Urban Development (HUD) estimate of income for a 4-
person household in the Los Angeles-Long Beach Primary
Metropolitan Statistical Area. The major income categories
are: "low-income" (sixty percent or less of the area median),
"very low-income" (fifty percent or less of the area median),
9
and "moderate-income" (one hundred percent or less of the
area median in limited equity ownership proLects and eightx
percent or less of the area median in rental projects).
Adjustment shall be made by household size as established
by the City.
Market Rate Unit. A dwelling unit as to which the
rental rate or sales price is not restricted by this Chapter.
Maximum Affordable Rent. A monthly housing
charge which does not exceed one-twelfth of thirty percent of
the maximum very low-, low-, and moderate-income levels
as defined in this Chapter and adopted each year by the
City. This charge shall represent full consideration for
housing services and amenities as provided to market rate
dwelling units in the project, whether or not occupants of
market rate dwelling units pay separate charges for such
services and amenities. Housing services and common area
amenities include, but are not limited to, the following:
parking, use of common facilities including pools or health
spas, and utilities if the project is master-metered.
Notwithstanding the foregoing, utility charges, to the extent
individually metered for each unit in the project, may be
passed through or billed directly to the occupants of
affordable housing units in the project in addition to
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maximum allowable rents collected for those affordable
housing units.
Multi-family Project. A multi-family residential
development, including but not limited to apartments,
condominiums, townhouses or the multi-family residential
component of a mixed use project, for which City permits
and approvals are sought.
Multi-family Project Applicant. Any person, firm,
partnership, association, joint venture, corporation, or any
entity or combination of entities which seeks City
development permits or approvals to develop a multi-family
project.
Multi-family Residential District. Any district
designated in the Santa Monica Zoning Ordinance as a
multi-family residential district.
Parcel: Parcel as defined in Santa Monica Municipal
Code Section 9.04.02.030.570.
Vacant Parcel. A parcel in a multi-family residential
district that has no residential structure located on it as of
August 20, 1998 or which had a residential structure located
on it on that date which was subsequently demolished
11
pursuant to a demolition order of the City. No demolition of
structures shall be permitted except in accordance with
Santa Monica Municipal Code Section 9.04.10.16 et seq.
SECTION 2. Santa Monica Municipal Code Section 9.56.030 is hereby amended
to read as follows:
9.56.030 Applicability of chapter.
{~-}~ The obligations established by this
Chapter shall apply to each multi-family project for which a
development application was dee~e~ determined complete
on or after March a; a 9~ 16, 2006 involving the construction
of two or more market rate units. No building permit shall be
issued for any multi-family project unless such construction
has been approved in accordance with the standards and
procedures provided for by this Chapter.
(2) Multi-family projects for which a development
application was ~ee+~aed determined complete prior to March
~-;~~~~ 16, 2006 shall be subject to the provisions of Santa
Monica Municipal Code Section ~ 9.56.01 Q et seq. as
they existed on the date the application for the project was
~~er~ed determined complete.
SECTION 3. Santa Monica Municipal Code Section 9.56.040 is hereby amended
to read as follows:
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9.56.040 Affordable housing obligation.
All multi-family project applicants ~~ ~hior+ tn +ho
. . shall
cam~ly with - the
requirements of this Chapter in the following manner:
ta} Multi-famil~project applicants with multi-family
roiects of four or more units shall choose one of the
following o~tions:
(-a}~ Providing affordable housing units on-site in
accordance with Section 9.56.050;
{~}~ Providing affordable housing units off-site in
accordance with Section 9.56.060;
(b) In addition to the aptions established in
subdivisions t1~ and (2~of subsection (a), multi-famil~project
applicants with multi-family projects of less than four units
may also choose one of the followinq options:
(c) Paying an affordable housing fee in
accordance with Section 9.56.070;
(d) Acquiring land for affordable housing in
accordance with Section 9.56.080.
13
A multi-family project application will not be dee~
determin~d complete until the applicant has submitted ~la~s
a+~- a written proposals which demonstrates the manner in
which the requirements of this Chapter will be met.
SECTION 4. Santa Monica Municipal Code Section 9.56.050 is hereby amended
to read as follows:
9.56.050 On-site option.
a##er~a~~~e~si+ag-~~~IigatiQ -
~e~+~~
t~e-~~v~g-~re~E~+~e+~aPr~lsThe followinq requirements must
k~e met to satisf~the onsite provisions of this ~hapter:
(a) The multi-family project applicant agrees to
construct at least: (1) twenty percent of the total units of a
project for low-income households if the muiti-family ~roject
less than sixteen units, or (2) ~e+a twenty-five percent of the
total units of a project for Wery-low income households if the
multi-family proiect is sixteen units or rc~eater, or (3) one
hundred percent of the total units of a project for moderate-
income households +~ . Any
fractional affordable housing unit that results from the
formulas of this subsection that is 0.75 or hiqher shall be
14
treated as a whole affordable housing unit (i.e.: any resulting
fraction shall be rounded up to the next larger integer) and
that unit shall also be built pursuant to the provisions of this
section. Any fractional affordabte housing unit that is less
than 0.75 can be satisfied by the payment of an affordable
housinq fee for that fractional unit only pursuant to Section
9.56.070(a~(4) or by constructingthe mandatory on-site
affordable units with three or more bedrooms. The Planning
and Community Development Department shall make
available a list of very low-, low-, and moderate-income
levels adjusted for household size, the corresponding
maximum affordable rents adjusted by number of bedrooms,
and the minimum number of very low- or low-income units
required for typical sizes of multi-family projects, which list
shall be updated periodically.
(b) The multi-family project applicant may reduce
either the size or interior amenities of the affordable housing
units as long as there are not significant identifiable
differences between affordab{e housing units and market
rate units visible from the exterior of the dwelling units,
provided that all dwelling units conform to the requirements
of the applicable Building and Housing Codes. However,
each affordable housing unit provided shall have at least two
15
bedrooms unless (1) the proposed project comprises at least
ninety-five percent one bedroom units, excluding the
manager's unit, in which case the affordable housing units
may be one bedroom, (2} the proposed project comprises at
least ninety-five percent zero bedroom units, excluding the
manager's unit, in which case the affordable housing units
may be zero bedroom units, a~ (3) the proposed project
comprises zero and one bedroom units, excluding the
manager's unit, in which case the affordable housing units
must be at least one bedroom units, or (4) the multi-family
praiect applicant has elected nat to pay the af#ordab{e
housina fee qursuant to Section 9.56.070(al(4). in which
case the affordable housina units must be at least three
"bedroom units. The design of the affordable housing units
shall be reasonably consistent with the market rate units in
the project. An affordable housing unit shall have a minimum
total floor area, depending upon the number of bedrooms
provided, no less than the following:
0 bedrooms 500 square feet
1 bedroom 600 square feet
2 bedrooms 850 square feet
3 bedrooms 1080 square feet
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4 bedrooms 1200 square feet
Affordable housing units in multi-family projects of one
hundred units or more must be evenly disbursed throughout
the multi-family project to prevent undue concentrations of
affordable housing units.
(c) All affordable housing units in a multi-family
project or a phase of a multi-family project shall be
constructed concurrently with the construction of market rate
units in the multi-family project or phase of that project.
(d) On-site affordable housing units must be
rental units +~-~~~~a-~ pfejes~- except I~ where one hundred
ercent of the total units af a aroiect are restricted to
moderate-incame householdsavdt~er~hi~--p~~e}eets, these
affordab{e housing units may be either rental units or
ownership units. Affordable housing ownership units shall
comply with requirements concerning sales price, monthly
payment, and limited equity and resale restrictions as
established by resolution of the City Council to ensure that
subsequent purchasers are also income-qualified
households.
(e) Each multi-family project applicant, or his/her
successor, shall submit an annual report to the City
17
identifying which units are affordable units, the monthly rent
(or total housing cost if an ownership unit), vacancy
information for each affordable unit for the prior year,
verification of income of the household occupying each
affordable unit throughout the prior year, and such other
information as may be required by City staff.
(fl A multi-family project applicant who meets
the requirements of this Section shall be entitled to the
density bonus development standards established in Santa
Monica Municipal Code Section 9.04.10.14.040.
(g) All residential developments providing
affordable housing on-site pursuant to the provisions of this
Section shall receive priority building department plan check
processing by which housing developments shall have plan
check review in advance of other pending developments to
the extent authorized by law.
SECTION 5. Santa Monica Municipal Code Section 9.56.060 is hereby amended
to read as follows:
9.56.060 Off-site option.
-A-~I~+-~a+~ i~-- .
a
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~k~~elle~n~a~--r~~~ir°,~;M~n~The following requirements must
be met to satisfy the off-site option of this Chapter:
(a) The multi-family project applicant shall agree
to construct ~- ^m~ two times the number of affordable
housing units as specified in Section 9.56.050.
(b) The multi-family project applicant shall
identify an alternate site suitable for residential housing
which the project applicant either owns or has site control
over (e.g., purchase agreement, option to purchase, lease)
subject to City review to ensure that the proposed
development is consistent with the City's housing objectives
and projects.
(c) The off-site units shall be located within a
one-quarter mile radius of the market rate units.
(d) The off-site units shall satisfy the
requirements of subsections (b) through (fl of Section
9.56.050.
(e) The off-site units shall not count towards the
satisfaction of any affordable housing obligation that
development of the alternative site with market rate units
would otherwise be subject to pursuant to this Chapter.
19
(fl Exceptions to the location of the off-site units
specified in this Section may be granted by the Planning
Commission on a case-by-case basis upon a showing by the
multi-family project applicant, based upon substantial
evidence, that the location of off-site units in a location
different from that specified in this Section better
accomplishes the goals of this Chapter, including maximizing
affordable housing production and dispersing affordable
housing throughout the City.
(g) The Housing Division of the Resource
Management Department sha11 prepare administrative
guidelines to implement this Section.
SECTION 6. Santa Monica Municipal Code Section 9.56.070 is hereby amended
to read as follows:
Section 9.56.070. Affordable housing fee.
A multi-family project applicant eligible to ~ meet
the affordable housing obligations established by this
Chapter by paying an affordable housing fee shall pay the
fee in accordance with the following requirements:
(a) An affordable housing fee may be paid in
accordance with the following formulas:
20
(1) Multi-family Projects in Multi-family Residential
Districts:
affordable housing unit base fee x floor area of multi-
family project;
(2) Multi-family Projects in Multi-family Residential
Districts on Vacant Parcels:
affordable housing unit base fee x floor area of multi-
family project x 75%;
(3) Multi-family Projects in Industrial/Commercial
Districts on Parcels that are either not already developed
with multi-family housing or are already developed with
multi-family housing, but the multi-family project preserves
the existing multi-family housing or a Category C Removal
Permit has been obtained for the existing multi-family
housing:
affordable housing unit base fee x floor area of project
devoted to residential uses x 50%.
(4) Multi-famil~pro~ects with fractional affordable
housinc~units of less than .75 based on the formula
established in Section 9,56.050(a}:
21
City's Affordable Housing Unit Development Cost x
Fractional Percentage
(b) For purposes of this Section, the affordable
housing unit base fee shall be established by resolution of
the City Council. Commencing on July 1, 2006 and on July
1 of each fiscal year thereafter, the affordable housing unit
base fee shall be adjusted based on changes in construction
costs and land costs. No later than July 1, 2010, and
approximately every five (5) year period thereafter, the City
will conduct a comprehensive study of these fees and the
results of the comprehensive study shall be reported to the
City Council. The amount of the affordable housing fee that
the multi-family project applicant must pay shail be based on
the affordable housing unit base fee resolution in effect at
the time that the affordable housing fee is paid to the City.
cl For auraoses af this Section. the Citv's
Rffordable HousinqUnit Development Cost shall be
established bv resoiutian of the Citv Councii. Commenci
on .!u{y 1, 2007 and an Ju4y 1 af each fiscal year thereafter,
the Citv's Affordable Housina Unit Develoament Cost shall
be adiusted based an chanqes in construction costs and
land costs. No later than Julv ~, 2010 and approximate
every five (5~year period thereafter, the City will conduct a
22
comprehensive study of these fees and the results of the
comprehensive study shall be reported to the CitYCouncil.
The affordable housina fee that the multi-familv pro
applicant must paY shalf be based on the Affardable Housing
Unit Development Cost resolution in effect at the time of
payment to the Cit~
~~e-} The amount of the affordable housing unit
base fee may vary by product type (apartment or
condominium) and shall reflect, among other factors, the
relationship between new market rate multi-family
development and the need for affordab{e housing.
~{d-} The affordable housinq fee shall be paid in
full to the City prior to the City granting any approval for the
occupancy of the project, but no earlier than the time of
building permit issuance.
~{-e~ The City shall deposit any payment made
pursuant to this Section in a Reserve Account separate from
the General Fund to be used only for development of very
low- and low-income housing, administrative costs related to
the production of this housing, and monitoring and
evaluation of this Affordable Housing Production Program.
Any monies collected and interest accrued pursuant to this
23
Chapter shall be committed within five (5) years after the
payment of such fees or the approval of the multi-family
project, whichever occurs later. Funds that have not been
appropriated within this five-year period shall be refunded on
a pro rata share to those multi-family project applicants who
have paid fees during the period. Expenditures and
commitments of funds shall be reported to the City Council
annually as part of the City budget process.
~{~} An affordable housing fee payment pursuant
to this Section shall not be considered provision of affordable
housing units for purposes of determining whether the multi-
family project qualifies for a density bonus pursuant to
Government Code Section 65915.
SECTION 7. 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, is hereby repealed or modified to that extent necessary
to effect the provisions of this Ordinance.
SECTION 8. 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 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,
24
or phrase not declared invalid or unconstitutional without regard to whether any portion
of the ordinance would be subsequently declared invalid or unconstitutional.
SECTION 9. The Mayor shall sign 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 15 days after its adoption. This Ordinance shall become
effective 30 days from its adoption.
APPROVED AS TO FORM:
1 n T ~ n .~
A S A JO~ S M UT E
City ttorney ~
25
F:atty\muni\laws\barry\affordablehousingamendordrev5-25-06-1 a.doc
City Council Meeting 05-25-06 Santa Monica, California
ORDINANCE NUMBER (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA AMENDING SANTA MONICA MUNICIPAL CODE SECTIONS
9.56.020, 9.56.030, 9.56.040, 9.56.050, 9.56.060 AND 9.56.070 TO MODIFY THE
OPTIONS FOR MEETING AFFORDABLE HOUSING REQUIREMENTS
WHEREAS, Santa Monica is a coastal city in a prime location, being bordered by
the City of Los Angeles to the north, east and south; and
WHEREAS, the combination of a scenic oceanside location, excellent climate,
and the ready availability of urban facilities, services and entertainment make Santa
Monica an extremely desirable place to live; and
WHEREAS, land area of the City is very small - approximately eight square
miles; and
WHEREAS, Santa Monica is already a fully built-out city, with only thirty-three
vacant residential parcels and a population of approximately ninety-one thousand five
hundred; and
WHEREAS, Santa Monica's population density, eleven thousand two hundred
persons per square mile, is the second highest among neighboring and nearby
jurisdictions, and is the densest among coastal communities in Los Angeles County;
and
1
WHEREAS, the vast majority of new market rate multi-family development in the
City is not affordable, with the average cost of a new market rate condominium in the
City is now approaching $1,200,000.00; and
WHEREAS, market conditions, including the high cost and lack of residential
land, construction costs, and the availability and cost of financing, make the
development of affordable housing in the City extremely difficult; and
WHEREAS, the vast majority of housing units have been and will continue to be
produced by the private housing industry; and
WHEREAS, new market rate multi-family housing in Santa Monica
accommodates upper-income households almost exclusively because of the high rent
or purchase price required to occupy it; and
WHEREAS, because the City is fully built-out, land available for residential
development in the City is extremely limited; and land which could be used for
development of housing for affordable households is being depleted by development of
high cost housing resulting in a continued rise in land costs; and
WHEREAS, continued new residential development which does not include or
contribute toward the cost of affordable housing development will only serve to further
exacerbate the current affordable housing shortage; and
WHEREAS, the lack of affordable housing production by market-rate
development has a direct impact upon the health, safety, and welfare of the residents;
and
WHEREAS, the failure to provide adequate affordable housing for lower-wage
workers can force these workers to live in less than adequate housing within the City,
2
pay a significantly disproportionate share of their incomes to live in adequate housing
within the City, or commute ever-increasing distances to their jobs from housing located
outside the City; and
WHEREAS, requiring developers to assist in the production of affordable housing
is also consistent with the City's long-standing commitment to achieve and maintain a
suitable living environment including decent housing for persons at all economic levels;
and
WHEREAS, this municipal commitment conforms with State and Federal policies
and is a principal goal of the City's 2000-2005 Housing Element Update and the 2005-
2010 Consolidated Plan; and
WHEREAS, California's Housing Element law requires each city and county to
develop local housing programs designed to address its "fair share" of existing and
future housing needs for all income groups; and
WHEREAS, the City's 2000-2005 Housing Element Update establishes the City's
fair share at 2,208 housing units of which 1,281 should be affordable; and
WHEREAS, between 1998 and 2005, 62% of new residential developments were
constructed in the City's commercial districts; and
WHEREAS, 84% of the residential units with building permits issued as of
December 2005 will be located in the City's commercial districts; and
WHEREAS, the City has historically effectuated this commitment to affordable
housing through extraordinary efforts manifest in various City laws, policies and
programs; and
3
WHEREAS, for instance, the City's voters have adopted initiative measures
which strive to maintain and promote affordable housing in the City; the Rent Control
Charter Amendment, adopted in 1979, has as its primary purpose the protection of
affordable housing and has historically been the City's most important legislative tool for
maintaining a supply of affordable housing; and, similarly, Proposition R, adopted by the
voters in 1990, mandates that thirty percent of all new multi-family housing units
constructed in the City each year be affordable; and
WHEREAS, the City's zoning laws and policies also include substantial
incentives for the production of affordable housing, including height and density
bonuses and reduced parking requirements; and
WHEREAS, the City operates a number of programs which facilitate the
production of affordable housing, including loans to private, non-profit agencies to
create through acquisition and rehabilitation, or construct new affordable housing units;
and
WHEREAS, the Housing Element Update catalogues a dozen funding sources
that the City utilizes to assist in the development and rehabilitation of affordable housing
totaling almost $70,000,000.00; and
WHEREAS, despite this significant commitment by the City, the City's total
housing needs exceed its available resources and the City's ability to meet these needs;
and
WHEREAS, despite the City's prime location and high real estate values, the City
has historically been successful in maintaining economic diversity; and
4
WHEREAS, based on census data in the 2000-2005 Housing Element Update,
23.0 percent of the City's households were very low income, 16.1 percent were low
income, 20.7 percent were moderate income, and 40.1 percent were upper income; and
WHEREAS, fifty-three percent of households residing in rent-controlled
apartments in the City were very low- and low-income; and
WHEREAS, this diversity is an essential element of the City's character; it sets
the City apart from all other similarly situated coastal cities in California; and
WHEREAS, nofinrithstanding the City's ongoing commitment and efforts, changes
in State and Federal law and market conditions are making it increasingly difficult for the
City to ensure a continued suppfy of affordable housing; and
WHEREAS; in 1986, the State enacted the Ellis Act which enables a property
owner to cease operating property as residential rental property and, more recently, in
1995, the State enacted the Costa-Hawkins Rental Housing Act which eliminated the
limits on the rents which a property owner may charge when re-renting voluntarily
vacated units; and
WHEREAS, between 1986 and 2005, over sixteen hundred controlled rental
units have been permanently withdrawn from the rental market pursuant to the Ellis Act;
and
WHEREAS, Costa-Hawkins has had a devastating impact on the City's
affordable housing stock because befinieen 1999 and 2005, 13,183 controlled rental
units, or about 48 percent of the total, have been rented at market rates; and
5
WHEREAS, 8,444 of these units had formerly been affordable to low-income
households including 5,351 units which had formerly been affordable to very low-
income households; and
WHEREAS, the median monthly rents upon re-rental have increased to
$1,300.00 from $735.00. (77%) for one bedroom units; $1,748.00 from $946.00 (85
percent) for finro bedroom units and $2,248.00 from $1,192.00 (89 percent) for three or
more bedroom units; and
WHEREAS, had the 13,183 units not been rented at market, the median
Maximum Allowable Rents ("MARs"), including the 1999-2005 general adjustment, for
these units would have been affordable to households making 80% of inedian income;
and
WHEREAS, none of the post-increase-medians are affordable at this income
.
category; and
WHEREAS, after these increases, the median MARs of the 0-bedroom units are
only affordable at 100% of inedian and above; and
WHEREAS, the median MARs of 1-bedroom units are only affordable to
households at 120% of inedian and above while the median rents for 2 and 3-bedroom
units are not even affordable to that income level; and
WHEREAS, this law is having and will continue to have a significant impact on
the City's supply of affordable housing; and
WHEREAS, there is an extremely low vacancy rate for the existing affordable
rental housing stock; and
6
WHEREAS, according to the annual report to the City Council concerning the
City Affordable Housing Production Program and Proposition R, only 17% of the units in
multifamily developments completed during FY03/04 were affordable; and
WHEREAS, based on the building permits that have been issued for new
multifamily developments, only 6% of these units will be affordable; and
WHEREAS, Section 9.56.150 of the Affordable Housing Production Ordinance
provides that when the provisions of Proposition R have not been met, the City Council
shall take action to ensure that its provisions are met in the future; and
WHEREAS, reductions in State and federal funding for affordable housing,
changes in these programs, and the potential expiration of controls on rents in federally-
assisted projects all hinder the City's ability to provide or promote affordable housing
threatening the City's existing affordable housing stock; and
WHEREAS, the decline in the affordability of this housing stock is further
exacerbated by the production of luxury market rate housing; and
WHEREAS, given current economic conditions and the general desirability of the
City; the price of new housing will only continue to increase, thereby further
exacerbating the growing shortage of affordable housing in the City; and
WHEREAS, this Affordable Housing Production Program will benefit the City as a
whole since each development which contributes to affordable housing through the
provisions of this Chapter augments the City's housing mix, helps to increase the supply
of housing for all economic segments of the community, addresses the affordable
housing need generated by the development, helps meet the voter mandate expressed
7
in Proposition R and thereby supports a balanced community which is beneficial to the
public health, safety and welfare of the City,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Santa Monica Municipal Code Section 9.56.020 is hereby amended
to read as follows:
9.56.020 Definitions.
The following words or phrases as used in this
Chapter shall have the following meanings:
Affordable Housing Fee. A fee paid to the City by a
multi-family project applicant pursuant to Section 9.56.070 of
this Chapter to assist the City in the production of housing
affordable to very iow-, low-, and moderate-income
households.
Affordable Housing Unit. A housing unit developed
by a multi-family project applicant pursuant to Sections
9.56.050 or 9.56.060 of this Chapter which will be affordable
to very low-, low-, or moderate-income households.
8
Affordable Housinq Unit Development Cost. The
Citv's average cost to develop a unit of housinq affordable to
low- and moderate income households.
Dwelling Unit. One or more rooms, designed,
occupied or intended for occupancy as separate living
quarters, with full cooking, sleeping and bathroom facilities
for the exclusive use of a single household. Dwelling unit
shall also include single-room occupancy units as defined in
Santa Monica Municipal Code Section 9.04.02.030.790.
Floor Area. Floor area as defined in Santa Monica
Municipal Code Section 9.04.02.030.315.
HUD. The United States Department of Housing and
Urban Development or its successor.
Income Eligibility. The gross annual household
income considering household size and number of
dependents, income of all wage earners, elderly or disabled
family members, and all other sources of household income.
Industrial/Commercial District. Any district
designated in the Santa Monica Zoning Ordinance as a
commercial or industrial district.
9
"Low," "Very Low," and "Moderate" Income
Levels. Income levels determined periodically by the City
based on the United States Department of Housing and
Urban Development (HUD) estimate of income for a 4-
person household in the Los Angeles-Long Beach Primary
Metropolitan Statistical Area. The major income categories
are: "low-income" (sixty percent or less of the area median),
"very low-income" (fifty percent or less of the area median),
and "moderate-income" (one hundred percent or less of the
area median). Adjustment shall be made by household size
as established by the City.
Market Rate Unit. A dwelling unit as to which the
rental rate or sales price is not restricted by this Chapter.
Maximum Affordable Rent. A monthly housing
charge which does not exceed one-twelfth of thirty percent of
the maximum very low-, low-, and moderate-income levels
as defined in this Chapter and adopted each year by the
City. This charge shall represent full consideration for
housing services and amenities as provided to market rate
dwelling units in the project, whether or not occupants of
market rate dwelling units pay separate charges for such
services and amenities. Housing services and common area
amenities include, but are not limited to, the following:
10
parking, use of common facilities including pools or health ~
spas, and utilities if the project is master-metered.
Nofinrithstanding the foregoing, utility charges, to the e~ent
individually metered for each unit in the project, may be
passed through or billed directly to the occupants of
affordable housing units in the project in addition to
maximum allowable rents collected for those affordable
housing units.
Multi-family Project. A multi-family residential
development, including but not limited to apartments,
condominiums, townhouses or the multi-family residential
component of a mixed use project, for which City permits
and approvals are sought.
Multi-family Project Applicant. Any person, firm,
partnership, association, joint venture, corporation, or any
entity or combination of entities which seeks City
development permits or approvals to develop a multi-family
project.
Multi-family Residential District. Any district
designated in the Santa Monica Zoning Ordinance as a
multi-family residential district.
11
Parcel. Parcei as defined in Santa Monica Municipal
Code Section 9.04.02.030.570.
Vacant Parcel. A parcel in a multi-family residential
district that has no residential structure located on it as of
August 20, 1998 or which had a residential structure located
on it on that date which was subsequently demolished
pursuant to a demolition order of the City. No demolition of
structures shall be permitted except in accordance with
Santa Monica Municipal Code Section 9.04.10.16 et seq.
SECTION 2. Santa Monica Municipal Code Section 9.56.030 is hereby amended
to read as follows:
9.56.030 Applicability of chapter.
(~-}~ The obligations established by this
Chapter shall apply to each multi-family project for which a
development application was ~ee~aed determined complete
on or after ~a~s# ~~ May 25, 2006 involving the
construction of two or more market rate units. No building
permit shall be issued for any multi-family project unless.
such construction has been approved in accordance with the
standards and procedures provided for by this Chapter.
(~~ Multi-family projects for which a development
application was ~ee+~ae~ determined complete prior to ~I~
12
-~~ Mav 25, 2006 shall be subject to the provisions of
Santa Monica Municipal Code Section ~ 9.56.010 et seq.
as they existed on the date the application for the project
was ~ee~e~ determined complete.
SECTION 3. Santa Monica Municipal Code Section 9.56.040 is hereby amended
to read as follows:
9.56.040 Affordable housing obligation.
All multi-family project applicants
. . shall
comply with the
requirements of this Chapter in the following manner:
~a) Multi-family project applicants for multi-family
ownership pro~ects of four or more units in multi-family
residential districts shall choose one of the two followinq
o tp ions:
{a-}~ Providing affordable housing units on-site in
accordance with Section 9.56.050;
{-b-}~ Providing affordable housing units off-site in
accordance with Section 9.56.060;
(b) In addition to the options established in
subdivisions (1) and (2) of subsection (a), atl other multi-
13
family proiect applicants may also choose one of the
following options:
(e~ Paying an affordable housing fee in
accordance with Section 9.56.070;
(~~ Acquiring land for affordable housing in
accordance with Section 9.56.080.
A multi-family project application will not be deer~e~
determined complete until the applicant has submitted ~s
a~- a written proposal~ which demonstrates the manner in
which the requirements of this Chapter will be met.
SECTION 4. Santa Monica Municipa{ Code Section 9.56.050 is hereby amended
to read as follows:
9.56.050 On-site option.
+ho f„~~,,,.,;n~ roni ~iromon~~The followinq requirements must
be met to satisfir the onsite provisions of this Chapter:
(a) For ownership projects of at least four units but
not more than 15 units in multi-family residential districts:
14
The multi-family prolect applicant agrees to construct
at least: (i) twentv percent of the total units as ownership
units for moderate-income households or as an alternative
(2) twenty percent of the total units as rental units for low-
income households if these rental units are voluntarilv
provided bv the applicant pursuant to Civil Code Sections
1954.52(b) and 1954.53(a)(2).
~b) For ownership proiects of 16 units or more in
multi-family residential districts:
The multi-family project applicant aqrees to construct
at least (i) twentv-five percent of the total units as ownership
units for moderate-income households, or as an alternative,
(ii) twenty-five percent of the total units as rental units for
low-income households if these rental units are voluntarilv
provided by the applicant pursuant to Civil Code Sections
1954.52(b) and 1954.53(a)(2).
(c) For all other multi-family applicants:
The multi-family project applicant agrees to construct
at least (i) ten percent of the total units of the project for
very-low income households or (ii) twenty percent of the total
units of the project for low income households or (iii) one
15
hundred percent of the total units of a project for moderate
income households in an Industria{/Commercial District.
(d) Any fractional affordable housing unit that resuits
from the formulas of this Section that is 0.75 or more shall be
treated as a whole affordable housing unit (i.e.: any resulting
fraction shall be rounded up to the next larger integer) and
that unit shaN also be built pursuant to the provisions of this
section. Any fractional affordable housing unit that is less
than 0.75 can be satisfied by the payment of an affordable
housinq fee for that fractional unit onlv pursuant to Section
9.56.070(a)(4) or by constructinq all the mandatarv on-site
affordable units with three or more bedrooms. The Planning
and Community Development Department shall make
available a list of very low-, low-, and moderate-income
levels adjusted for household size, the corresponding
maximum affordable rents adjusted by number of bedrooms,
and the minimum number of very low- or low-income units
required for typical sizes of multi-family projects, which list
shall be updated periodically.
~ The multi-family project applicant may reduce
either the size or interior amenities of the affordable housing
units as long as there are not significant identifiable
differences between affordable housing units and market
16
rate units visible from the exterior of the dwelling units,
provided that all dwelling units conform to the requirements
of the applicable Building and Housing Codes. However,
each affordable housing unit provided shall have at least two
bedrooms unless (1) the proposed project comprises at least
ninety-five percent one bedroom units, excluding the
manager's unit, in which case the affordable housing units
may be one bedroom, (2) the proposed project comprises at
least ninety-five percent zeco bedroom units, excluding the
manager's unit, in which case the affordable housing units
may be zero bedroom units, e~ (3) the proposed project
comprises zero and one bedroom units, excluding the
manager's unit, in which case the affordable housing units
must be at least one bedroom units, or (4) the multi-family
project applicant has elected not to pay the affordable
housing fee pursuant to Section 9.56.070(a)(4), in which
case the affordable housing units must be at least three
bedroom units. The design of the affordable housing units
shall be reasonably consistent with the market rate units in
the project. An affordable housing unit shall have a minimum
total floor area, depending upon the number of bedrooms
provided, no less than the following:
0 bedrooms 500 square feet
17
1 bedroom 600 square feet
2 bedrooms 850 square feet
3 bedrooms 1080 square feet
4 bedrooms 1200 square feet
Affordable housing units in multi-family projects of one
hundred units or more must be evenly disbursed throughout
the multi-family project to prevent undue concentrations of
affordable housing units.
,~f~ All affordable housing units in a multi-family
project or a phase of a multi-family project shall be
constructed concurrently with the construction of market rate
units in the multi-family project or phase of that project.
,(g1 On-site affordable housing units must be
rental units in rental projects. In ownership projects, these
affordable housing units may be either rental units or
ownership units. Affordable housing ownership units shall
comply with requirements concerning sales price, monthly
payment, and limited equity and resale restrictions as
established by resolution of the City Council to ensure that
subsequent purchasers are also income-qualified
households.
18
~(ee~ Each multi-family project applicant, or
his/her successor, shall submit an annual report to the City
identifying which units are affordable units, the monthly rent
(or total housing cost if an ownership unit), vacancy
information for each affordable unit for the prior year,
verification of income of the household occupying each
affordable unit throughout the prior year, and such other
information as may be required by City staff.
~~ A multi-family project applicant who meets
the requirements of this Section shall be entitled to the
density bonus development standards established in Santa
Monica Municipal Code Section 9.04.10.14.040.
~(g) All residential developments providing
affordable housing on-site pursuant to the provisions of this
Section shall receive priority building department plan check
processing by which housing developments shall have plan
check review in advance of other pending developments to
the extent authorized by law.
19
SECTION 5. Santa Monica Municipal Code Section 9.56.060 is hereby amended
to read as follows:
9.56.060 Off-site option.
+ho fnlln~~iinn roir~ ~iromon~oThe followinq requirements must
be met to satisfy the off-site option of this Chapter:
(a) The multi-familv proiect applicant for
ownership proiects of four or more units in multi-familv
residential districts shall aqree to construct 25% more
affordable housinq units than number of affordable housinq
units required by Section 9.56.050(a) and (b).
(b) For all other multi-familv project applicants, the
applicant shall aqree to construct the same number of
affordable housing units as specified in Section 9.56.050(c).
_(c) The multi-family project applicant shall identify
an alternate site suitable for residential housing which the
project appiicant either owns or has site control over (e.g.,
purchase agreement, option to purchase, lease) subject to
20
City review to ensure that the proposed development is
consistent with the City's housing objectives and projects.
~{~} The off-site units shall be located within a
one-quarter mile radius of the market rate units.
~{~} The off-site units shall satisfy the
requirements of subsections ~{~} through ~{#} of Section
9.56.050.
~f {e~ The off-site units shall not count towards
the satisfaction of any affordable housing obligation that
development of the alternative site with market rate units
would otherwise be subject to pursuant to this Chapter.
~4#} Exceptions to the location of the off-site
units specified in this Section may be granted by the
Planning Commission on a case-by-case basis upon a
showing by the multi-family project applicant, based upon
substantial evidence, that the location of off-site units in a
location different from that specified in this Section better
accomplishes the goals of this Chapter, including maximizing
affordable housing production and dispersing affordable
housing throughout the City.
21
~{~~ The Housing Division of the Resource
Management Department shall prepare administrative
guidelines to implement this Section.
SECTION 6. Santa Monica Municipal Code Section 9.56.070 is hereby amended
to read as follows:
Section 9.56.070. Affordable housing fee.
A multi-family project applicant eliqible to ~ meet
the affordable housing obligations established by this
Chapter by paying an affordable housing fee shall pa~the
fee in accordance with the following requirements:
(a) An affordable housing fee may be paid in
accordance with the following formulas:
(1) Multi-family Projects in Multi-family Residential
Districts:
affordable housing unit base fee x floor area of multi-
family project;
(2) Multi-family Projects in Multi-family Residential
Districts on Vacant Parcels:
affordable housing unit base fee x floor area of multi-
family project x 75%;
22
(3) Multi-family Projects in Industrial/Commercial
Districts on Parcels that are either not already developed
with multi-family housing or are already developed with
multi-family housing, but the multi-family project preserves
the existing multi-family housing or a Category C Removal
Permit has been obtained for the existing multi-family
housing:
affordable housing unit base fee x floor area of project
devoted to residential uses x 50%.
~4) Multi-family proiects with fractional affordable
housing units of less than 0.75 based on the formula
established in Section 9.56.050(d):
Citv's Affordable Housing Unit Development Cost x
Fractional Percentaqe
(b) For purposes of this Section, the affordable
housing unit base fee shall be established by resolution of
the City Council. Commencing on July 1, 2006 and on July
1 of each fiscal year thereafter, the affordable housing unit
base fee shall be adjusted based on changes in construction
costs and land costs. No later than July 1, 2010, and
approximately every five (5) year period thereafter, the City
will conduct a comprehensive study of these fees and the
23
results of the comprehensive study shall be reported to the
City Council. The amount of the affordable housing fee that
the multi-family project applicant must pay shall be based on
the affordable housing unit base fee resolution in effect at
the time that the affordable housing fee is paid to the City.
~c) For purposes of this Section, the City's
affordable housing unit development cost shall be
established by resolution of the City Council. Commencing
on Ju1v 1, 2007 and on Julv 1 of each fiscal year thereafter,
the Citv's affordable housing unit development cost shall be
adiusted based on chanaes in construction costs and land
costs. No later than Jufy 1, 2010 and approximately every
five (5) year period thereafter, the City will conduct a
comprehensive study of these fees and the results of the
comprehensive study shall be reported to the City Council.
The affordable housinq fee that the multi-family proiect
applicant must pav shall be based on the affordable housing
unit development cost resolution in effect at the time of
pavment to the Citv.
~Ec-} The amount of the affordable housing unit
base fee may vary by product type (apartment or
condominium) and shall reflect, among other factors, the
24
relationship befinreen new market rate multi-family
development and the need for affordable housing.
~{-d} The affordable housinq fee shall be paid in
full to the City prior to the City granting any approval for the
occupancy of the project, but no earlier than the time of
building permit issuance.
~f {e~ The City shall deposit any payment made
pursuant to this Section in a Reserve Account separate from
the General Fund to be used only for development of very
low- and low-income housing, administrative costs related to
the production of this housing, and monitoring and
evaluation of this Affordable Housing Production Program.
Any monies collected and interest accrued pursuant to this
Chapter shall be committed within five (5) years after the
payment of such fees or the approval of the multi-family
project, whichever occurs later. Funds that have not been
appropriated within this five-year period shall be refunded on
a pro rata share to those multi-family project applicants who
have paid fees during the period. Expenditures and
commitments of funds shall be reported to the City Council
annually as part of the City budget process.
25
~g~,{~} An affordable housing fee payment pursuant
to this Section shall not be considered provision of affordable
housing units for purposes of determining whether the multi-
family project qualifies for a density bonus pursuant to
Government Code Section 65915.
SECTION 7. 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, is hereby repealed or modified to that extent necessary
to effect the provisions of this Ordinance.
SECTION 8. 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 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 unconstitutiorial.
SECTION 9. The Mayor shall sign 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
26
official newspaper within 15 days after its adoption. This Ordinance shall become
effective 30 days from its adoption.
APPROVED AS TO FORM:
. ,~ (
~°~~ ~/ p~~~'
MA SHA J S MOUT E
City ttorne~i
27
ATTACHMENT B
Council Meeting: May 10, 2005
TO: Mayor and City Council
FROM: City Staff
Santa Monica, Califomia
SUBJECT: Strategies to Increase the City's Supply of New Affordable Units
INTRODUCTION
This report discusses the Affordable Housing Production Program and other policies
and programs that the City Council may want to consider updating so that annual
affordable housing production better fulfills the goafs of Proposition R.
BACKGROUND
The City Council directed staff to evaluate the Affordable Housing Production Program
and/or other City programs and policies, and suggest ways to update these provisions
to facilitate meeting the Proposition R affordable housing goals (that 30% of all newly
constructed multifamily housing each year be affordable to low and moderate income
households).
As a matter of law and policy, the City of Santa Monica is committed to producing and
preserving affordable housing. This commitment is effect~ated, in part, through the
City's Affordable Housing Production Program (SMMC Chapter 9.56). This program
requires that developers of new market-rate multifamily housing within the City include
affordable housing units on-site, construct them off-site, pay an affordable housing fee
to the City, or acquire and dedicate land to the City for construction of affordable units.
1
DISCUSSION
Changes in the realities of housir~g production and in Califomia law yield. new
constraints and opportunities for the City concerning affordable housing requirements.
Pursuant to Council direction, staff has worked with a consultant to review options for
updafing the Affordable Housing Production Program (AHPP), including revising its
affordable housing fees, and considering incentives that might encourage more
developers of market-rate muttifamity housing to canstruct affordable hausing units.
There are several options involving revisions to the AHPP, zoning regulations, permit
procedures and other City policies that the City Counci! may discuss and consider.
These options are categorized as follows:
1. Update the affordable housing fees
2. Make other adjustments to the affordable housing fee
3. Increase the density bonus
4. Further reduce parking requirements
5. Waive, reduce or defer various permit fees
6. Broaden permit streamlining
7. Amend Proposition R
8. Require on-site affordable units
~
~
On February 17, 2005, the Housing Commission considered the information presented
in this staff report. On March 17, 2005, the Housing Commission and the Planning
Commission held a joint meeting to consider and discuss these options. The purpose of
the March 9 7~' meeting was for the two Commissions to make recommendations to the
City Council regarding these options. The Housing Commission and the Planning
Commission reached a consensus recommending that Council adopt four of the
proposed fifteen options ident~ed in this report:
1) Increase the affordable housing fee to the highest supportable level
(Option 1);
2) Eliminate the current affordable housing fee discounts (Option 2.a);
3) Incorporate an annual inflation adjustment to the affordable housing fee
(Option 2.c); and
4) Allow payment of the affordable housing fee for fractional units (Option 2.d).
The two Commissions also reached a consensus that two other proposed options
should not be pursued:
1) City permit fees should ~ot be waived, reduced or deferred (Option 5); and
2) Broadened streamlining is not endorsed at this time but, Council should revisit
that option in the future (Option 6).
Finally, the Commissions recommended that City Council should direct staff to continue
researching the legal feasibility of mandating some affordable units (whether on-site or
off-site) for all new multifamily developments (Option 8).
~
~
The remaining options that the Commissions did not reach consensus are: ~
1) Adjust the fees to account for construction and land cost inflation to time of
use (Option 2.b);
2) Vary the fees by City subarea (Option 2.e);
3) Change the basis of fee impasition to a percent of sale price for
condominiums. (Option 2.f);
4) Require affordabie housing fee payment when obtaining building permit
{Option 2.g);
5) Allow market rate multi-family developers to purchase "credits" in affordable
housing developments built by other parties (Option 2.h);
6) Increase the density bonus (Option 3);
7) Further reduce parking requirements (Option 4); and
8) Amend Proposition R(Option 7).
All of the options presented to the Housing Commission and Planning Commission are
explained below in further detail.
1. Update the Affordable Housin4 Fee
Since tf~e adopfion of the AHPP, most developers, and particuiarly developers of
condominium projects, have elected to pay the affordable housing fee rather than
construct affordable units on-site or off-site. These fees are deposited into the City's
4
.
Housing Trust Fund and are then provided as grants or (oans to developers of
affordable housing, who usually leverage City funds with other financial resources.
Thus, the amount of the affordable housing fee bears a direct relationship to the number
of affordable units that can be constructed.
The current housing fees have not been updated for several years. The fee applicable
to apartments was first established in July 1998 at $6.14 per square foot and has never
been updated. The condominium fee was originally established in July 1998 at $7.13
per square foot and was then updated in March 2000 to $11.01 per square foot. These
fees were established based on a study prepared by Hamilton, Rabinovitz & Alschuler,
Inc. (HR&A) that focused exclusive(y on the relationship between the demand for goods
and services created by households who occupy new market-rate multifamily
development in the City, the number of low-wage workers needed to satisfy this
demand, and the costs of producing the affordable housing needed by these workers
who reside in low-income households. The study estabiished the fee range per square
foot that could be imposed on new market-rate multifamily development to help finance
the devefopmenf of affordable housing needed to meet the demand created by market-
rate multifamily housing development. The calculation approach was thoroughly peer
reviewed, at the request of the City Councii, and has received favorable commentary in
the professional literature.
The formula for caiculating the affordabls housing fees was based primarily on the
income and spending patterns of households in new market-rate housing, the (ower-
5
.
wage labor demand needed to support this spending, and the cost of construc#ing
multifamily housing affordable for those lower-wage workers who reside in low-income
households. A detailed explanation of these factors is included in Attachment A. Since
the adoption of the current affordable housing fee for apartment and condominium
developments, new household income and spending and other data have become
available, and the costs of constructing, renting, and purchasing multifamily housing
have all increased significantly. A detailed explanation of the changes in the data used
to recalculate the affordable housing fees since the last fee update is included in
Attachment B.
Based upon the HR8~A's study formula and current data detailed in Attachments A and
B, and broadening the labor demand analysis to also include moderate-income
households (up ta 100% x area median income {AMI}), consistent with Proposition R,
the resulting new fe~ for apartments would be approximately $21.68 per square foot
and the new fee for condominiums would be approximately $25.63 per square foot
subject to additional adjustments discussed subsequently in this report and any further
refinements of the analysis. The preliminary calculations represent an increase of
approximately $15.54 and $14.62 per square foot, respectiveiy.
2. Ofher Adiusfinents to the Affordable Housinq Fee Option ~
There are several other refinements to the AHPP's affordable housing fee that should
be considered to ensure that it constitutes an equivafent affordable housing obligation
as on-site or off-site construction.
b
.
, ~
a) Eliminate the affordable housing fee discounts. The fee discounts contained
in the AHPP may no longer be necessary. Currentiy, the AHPP includes a
twenty-five percent (25%) discount on fees imposed on developments
constructed on vacant land in residential zones, and fifty percent (50%) discount
for developments constructed on non-residential sites (that do not already
contain multifamily units). These fee disco+~nts were intended to help steer new
multifamily development away from underdeveloped sites in multifamily
neighborhoods and toward commercial areas. Muftifamily deveiopment activity
since the fee discounts were established has occurred primarily in the non-
residential areas of the City, particularly the downtown. This trend likely reflects
the higher densities allowed in the downtown and not the fee discounts.
Therefore, the fee discounts no {onger appear necessary or justified.
b) Adiust the fees to account for construction and land cost inflation to time of
use. Affordable housing fee revenue is deposited in the City's Housing Trust
Fund and often takes a few years to accumulate until sufficient funds are
available to fund new affordable housing. During this interim, the fee revenue
loses some of its purchasing power due to constructio~ and other development
cost inflation including increased land costs. The fee amount could be adjusted
upward by an annual inflation factor for the average time the funds remain in the
account prior to expenditure. The inflation adjustmeni should, ideally, reflect a
combination of factors such as changes in construction costs, area median
7
- income, and land value based on data that is readily availabie. The inflation
factor formula may need to account for any interest earnings the City receives on
the deposit of such funds.
c) Annua! inflation adiustment. The AHPP provides for periodic recalculation of
the fees to account for changed housing market circumstances, but this is not
automatic and historically has not been perFormed annually. The program could
provide for an automatic annual inflation adjustment to the base fee amounts
between periodic recalculations, just as the office development affordable
housing fee is adjusted. This would be in addition to the inflation factor described
above, which accounts for the time that the fee revenues are held in the Housing
Trust Fund. Once again, the inflation factor should reflect a combination of
factors such as changes in construction costs, area median income, and land
value based on data that is readily available for calculating the annual
adjustment.
d) Allow fees for fractional inclusionarv units. For developers who elect to
include units in their developments, but application of the percentage
requirement resuits in a fraction of a unit, consider applying the fee formula to the
fractional unit. This wauld eliminate an on-site production disincentive in
situations where the affordable percentage calculation results in a fraction of a
unit that then must be rounded up to the next integer and treated as a whole
8
affordable housing unit. This would not diminish the affordable housing
requirement.
e) Vary the fees bv Citv subarea. Fees could be established for several
subareas of the Cityr, as defined by housing market differences (e.g., average
land values, rents and/or purchase prices). As is current practice, the affordable
housing fee update considers such differences and then averages across them
for a City-wide apartment and condominium development fee per square foot.
This averaging approach has the effect of slightly under-pricing the fee in higher-
cost areas of the City (e.g., north of Wilshire) and slightly over-pricing the fee in
lower-cost areas. Since the adoption of the AHPP, more market rate units have
been constructed in higher-priced or rapidly appreciating areas. To the extent
that this continues to be the case, the City may be losing fee revenue. Setting
the fees at rates spec~c to their submarket areas would eliminate this
circumstance. The City Council could also consider adopting a uniform fee
based on a weighted average.
fl Chanqe the basis of fee imposition to a percent of sale price for condominiums.
The current affordable housing fee is imposed per gross square foot of new
multifamily development. This means that the fee has a relatively larger impact
on small developments and developments located in fower-price areas compared
with the impact on larger developments or developments located in higher-price
areas. One way to minimize such effects, and allow the fee to move
9
automatically in tandem with changes in the real estate market, is to impose the
fee as a percentage of the sale price. For example, the updated fee for a typica!
five-unifi condominium development north of Wilshire Boulevard is equivalent to
about four and nine tenths percent (4.9%) of the average sale price in that area.~
This approach, however, would be more complicated to administer and difficutt to
enforce.
g) Require affordable housina fee pavment when obtainin4 buildin4 permi#.
Currently the affordable housing fee payment is not due until the development is
compieted. The City uses these fees to subsidize affordable units, and the ideal
scenario is to have the development of such units happen concurrenUy with the
associated market-rate units. Therefore, requiring developers to pay the
affordable housing fee at the time they obtain a building permit for their market-
rate units assists in achieving the concurrent development scenario.
h) Allow market rate multi-familv developers to purchase "credits" in affordable
housing developments built by other parties. Another option for meeting the
affordable housing obligation would be for developers to pay non-profit or for-
profit developers of affordable housing developments for some of the units in
those developments provided the payment is essential to completing the
financing of the development and complies with other elements of the AHPP.
This approach would be an alternative to paying an affordable housing fee to the
' Assumes the recalculated citywide average condominium affordable housing fee per square foot applied to a five-
unit North of Wilshire condo project with average sale prices of $816,969 per unit (i.e., [$25.63ls.f. x 7,800 s.f.] /
[$S 16,969 x 5 vnits] = 4,9%).
la
City, and could result in faster construction of affordabie housing since the
payment would be used ta complete the financing for a development already
under way. In addition to amending the AHPP, such a credit system woufd
require establishing new administrative guidelines to ensure that the payment for
credits is at least equai to the amount of the otherwise applicable affordable
housing fee, and that the payment will result in relatively prompt construction that
would not otherwise result. All other requirements for off-site affordable units,
inciuding type, size, iocation reiative to the market rate deveiopment~ occupying
household income and price restrictions, would also apply. City monitoring of
such pri~ate transactions would be required. This "credit" concept is a feature of
the inclusionary housing ordinance in Santa Cruz (Santa Cruz Municipal Code
Section 24.16.030).
3. Increase the DensitY Bonus
Currently, if a multifamily development satisfies its AHPP affordable housing obligation
by including affordable units on-site, other sections of the Zoning Code provide a
minimum density bonus of twenty-five percent (25%) above the under~ying zoning
standard for that site. Until January 15' of this year, the density bonus allowed in that
instance was the same as that mandated by State law, and was commonly referred to
as the State density bonus. To be eligible for this density bonus a development had to
have at least ten percent (10%) of the units affordable to very low-income households or
twenty percent (20%) of the units affordable to low-income households, which are the
same thresholds for the affordable requirements in the AHPP.
11
The density bonus now mandated under State law that became effective January 1S`
provides for a siiding scale of density bonus depending on the percentage of affordable
units included in a development. The density bonus sliding scale ranges 'from a
minimum of twenty percent (20%) to a maxirnum of thirty-five percent (35%). However,
the~ minimum eligibility criteria for the new density bonus have been relaxed. A
multifamily development that includes only five percent (5%) of the units affordable to
very low-income households (lowered from the previous 10% requirement), ten percent
(10%) of the units affordable to low-income households (lowered from the previous 20%
requirement), or ten percent (10%) affordable to moderate-income households in a
condominium development, is now eligible for a minimum finrenty percent (20°l0) density
bonus (lowered from the previous 25% density bonus). State law now allows a
maximum density bonus of thirty-five percent (35%) to a development that dedicates
either eleven percent (11 %) of its units to very low-income households; twenty percent
(20%) to low-income households; or twenty-five percent (25%) of the units in a
condominium development to moderate-income households.
The State law revision also requires that between one and three "incentives or
concessions" must be provided to a developer, depending upon the percentage of
affordable units included in the development.
It appears that the City's zoning regulations may need to be amended to be consistent
with the new State density bonus law, and this increased density bonus (from 25% to
12
35%) for meeting the AHPP requirernents may provide a sufficient incentive for more
inclusion of affordable units in developments, rather than payment of an affordable
housing fee. Planning staff is preparing a more detailed analysis of the implications of ~
this State law on current City requirements for future Council consideration.
4. Further Reduce Parkinq Recruirements
Another incentive to consider for developments that inciude affordable units is a
reduced parking space requirement. The City zoning regulations current)y allow a
reduced parking requirement, but only for each affordable unit. However, multifamily
developments also have a parking requirement regarding guest spaces, and the current
zoning regulations do not allow for this requirement to be reduced when affordable units
are included in the development. The new State density bonus law discussed above
mandates that developments qualifying for the density bonus must also be granted a
reduced parking requirement. Again, it appears that the City's zoning regulations may
require amendment to be consistent with the new State density bonus law. Because
the cost of parking, most often in subterranean levels in Santa Monica~ is a significant
development cost, this change mandated by State law may also provide an incentive for
developers to include affordable units in their developments.
5. Reduce Defer or Waive Various Permit Fees and Taxes
There are various fees and taxes associated with multifamily housing development
involving planning and zoning applications, building permits, utility and sewer hook-ups
and parks and recreation fees. These fees pay for City services provided in reviewing
13
planning applications, building pians, construction inspections, and other services.
These fees amount to tens of thousands of dollars for small developments and
hundreds of thousands of dollars for larger developments. Developers typically have to
pay these fees and taxes out of the equity contribution to the development, because
payment is required prior to the time a construction loan can be obtained, and these
costs are not always reimbursable from the construction loan.
One incentive to consider would be to reduce, defer or waive such fees and taxes on a
proportional basis to reduce the cost to the developer of providing affordable units in
their developments or constructing them off-site. The AHPP already provides for a
waiver of the Condominium Tax and the Park and Recreational Facilities Tax for
constructed affordable units. A similar approach could be applied to planning permit
fees, building permit fees and other public works-related fees. Altematively, these fees
could be reduced by some percentage, or payment could be deferred to issuance of the
certificate of occupancy, rather than at issuance of the building permit. Although such a
policy woutd reduce the cost for those developments containing affordable units, the
City services represented by these fees would still have to be provided, and the loss of
revenue from these fees could create a budget problem and ultimately affect staff
availability for these functions.
6. Broadened Permit Sfreamlininq
The time required to complete the City's permit processes also adds to the cost of
development, and any time savings for developments that include affordable units might
14
serve as an effective incentive. Currently the AHPP provides that developments which
include affordable units are to receive priority plan check review (i.e:, buiiding permit
process). However, a development begins at the planning application. stage and ends
at the completion of construction. Another incentive to consider involves permit
streamlining for the planning approval process (and any appeals involving a public
hearing) and priority construction inspections. The entitlement process~ plan check
process and the construction inspection process all take time that adds to the cost of
development. To the extent that a development timeline can be reduced~ there are cost
savings to a developer that may mitigate some of the cost of providing affordable units.
7. Amend Proaosition R
Proposition R requires that thirty percent (30%) of all new multifamily housing on an
annua! basis be affordable to low and moderate income households. Proposition R
could be amended to allow existing units that are rehabilitated and dedicated as
affordable (via recorded covenants) ~o count toward the thirty percent goal. For
example, the City uses a portion of its housing trust funds to subsidize the acquisition
and rehabilitation of units by the nonprofit housing community. This effort does not
count toward the achievement of Proposition I~ goals, even though the number of
affordable units is increased by this activity. Dedication of existing units furthers the
goals of preserving and creating affordable housing, whether undertaken by nonprofit or
market-rate developers.
IS
Proposition R could also be amended so that the thirty percent requirement must be
achieved over a multi-year average, rather than the current annual basis. For example,
some years the percentage of affordable units created on an annual basis may ~
significantly exceed the thirty percent requirement (as in the 1990's), while more
recently, production has been below the thirty percent requirement. However, on an
aggregate basis to date, actual affordable housing production has exceeded the
Proposition R mandate, achieving an affordable housing rate of approximately forty
percent (40%). Therefore, allowing the thirty percent standard to be met using a multi-
year average would level the year-tayear highs and lows associated with real estate
market cycles and financial packaging for affordable developments, and may provide a
more rational basis for evaluating the results of the City's overall affordable housing
programs. Since Proposition R is a City Charter provision, any amendment would
require a vote and majority approval by the City's residents,
8. ReQUire On-Site Afforo-ab/e Units
Ordinance No. 1fi15 (City Council Series), the City's Affordable Housing Production
Ordinance that preceded Ordinance No. 1918 (CCS) mandated that affordable housing
units be developed on-site with limited exception. When Ordinance No. 1918 (CCS)
was adopted, the City Council chose to expand the options for compliance with the
affordable housing obligation for both policy and legal reasons. As discussed below,
the legal concems have not changed appreciably since Ordinance No. 1918's adoption.
16
Lec~at issues
A city's authority to adopt an affordable housing production ~program was most recently
affirmed in Home Buiiders Association of Northem California v. Citv of Naaa. However~
the specific requirements of these programs may still be subject to judicial scrutiny. In
considering possible amendments to the AHPP, several potential legal issues have
been raised. No doubt other issues will arise as the City proceeds to evaluate and
update its affordable housing production ordinance.
One issue concems the ability of a city to mandate on-site inclusionary rental units. The
legal uncertainty regarding a city's ability to impose a mandatory on-site requirement
has not changed substantially since the City adopted its AHPP. More specifically, as to
apartments, the issue remains whether the Costa-Hawkins Rental Housing Act ("Costa-
Hawkins Act°) prevents a local authority from controlling the rents on inclusionary
housing units. While the Costa-Hawkins Act was certainly not drafted with this purpose
in mind, its broad language might be read to affect this result. Moreover, efforts in the
State legislature to modify the law to eliminate this possibility have failed. Also, the
applicability and utility of the Costa-Hawkins Act exception for contracts with developers
is unclear. Finally, it should be noted that the Cit~r's prior inclusionary ordinance.
Ordinance No. 1615 (CCS), which required on-site units was challenged under the
Costa-Hawkins Act. Although no final decision was rendered since the City changed
the ordinance while the case was pending, the trial court had preliminarily concluded
that Costa-Hawkins applied to inclusionary units. These concems do not apply to for-
sale affordable condominiums.
1?
The second issue concerns nexus requirements. Current case law continues to require
a connection befinreen any exaction imposed upon a private developer and the impacts
of that development, although the relationship befinieen means and ends does not have
to be as thoroughly established for legislatively imposed fees as for ad hoc,
development-specific fees.
For instance, in San Remo Hotel v. Citv and Countv of San Francisco (a case which
chailenged San Francisco's residential hotel conversion law), the California Supreme
Court reiterated the necessity of a cor~nection between development mitigation fees and
development impacts. While the Court held that the heightened scrutiny established by
the United States Supreme Court in Nolan v. Californi~ Coastal Commission need not
be met, development mitigation fees must still bear a reasonable relationship in both
intended use and amount with the deleterious impacts of the development. The Court
stated that this requirement was both a matter of statutory law and constitutional law.
In City of Napa, the California Court of Appeal rejected a facial takings challenge to
Napa's inclusionary housing ordinance which required that ten percent (10%) of the
housing units be affordable on site. The Napa ordinance provided altematives.
Developers of single-family units could satisfy the requirements through other means
(e.g., land dedication, units at another site, affordable housing fees). Developers of
multi-family units had to seek City Council authorization to pursue an altemative. In
upholding the law, the Court noted that the ordinance imposed a relatiyely modest
18
exaction and provided significant benefits to developers. More importan~y, the
ordinance expressly allowed developers to challenge the ordinance's requirements
based on a lack of nexus by applying for a reduction, adjustment or waiver. Thus,
although the case is certainly favorable for cities, it does not stand for the proposition
that no nexus is necessary. Rather, it upholds a local ordinance which shifts the burden
to developers to show the absence of a nexus instead of requiring cities to perform
nexus studies before adopting an inclusionary ordinance.
Another issue concems the impact of the EIlis Act on inclusionary housing
requirements. To the extent that the requirements are based on the loss of existing
housing stock removed pursuant to the Ellis Act, the ordinance may be subject to
challenge, based on the decision in Bullock v. Cit~r and Countv of San Francisco. A
recent Court of Appeal decision reaffirmed the Bullock decision, Reidy v. Citv and
Countv of San Francisco. However, since the San Francisco conversion ordinance
challenged in Bullock and Reidv required a one-for-one replacement of residential hotel
units or payment of a substantial affordabie housing fee, neither of these cases provides
clear guidance on the remaining extent of municipal power to foster the replacement of
affordable units lost to Eilis withdrawals.
19
Budaet/Financial Impact
No budget or financial impact is incurred as a result of action on this recommendation.
Future budget or financial impact will be identified and reported.
RECOMMENDATION
It is recommended that the City Councii consider and discuss the various affordable
housing strategies outlined in this report including the recommendations of the Housing
and Planning Commissions, and provide direction to staff to prepare applicable
amendments to the Affordable Housing Production Program and/or other City policies or
programs, for subsequent Council action.
Prepared by: Jeff Mathieu, Director, Resource Management Department
Ron Barefield, Acting Housing & Redevelopment Manager
Jim Kemper, Acting Housing Administrator
ATTACHMENTS
Attachment A: Overview of the HR&R's Affordable Housing Impact Analysis
Approach **
Attachment B: Changes to Prior Application of the Affordable Housing Impact
Calculation Approach **
**Attachments to 5/10/OS Staff Report omi:tted from this Attachment B
20
ATTACHMENT C
Attachment C
: Total Un~ts m
~' '~ ~ 1~k `s~" ~ ,3'
~roJe~~~. ~ ~
~ r 2~`~.a a ~ ~, -
.. ~ .,qs ~ a" .5'FE' :~
~
ry
,,.. ..a,c .-.,. ,.,,...
~ Percent
~ ,
~, i . ~` +`Yt }
`~ Affordablex
r~;~ . ~ ~~ . r ,,y,$f~s
k. `~' ~' ~- C .z.•Y+i'` 3 u~
4'
' r ,¢ .:. `3" 's,.
,,. ., n~..>, z,. , ., .~_
Calculation,~
~ ~
~. : j I
~ Resul# '
~ ~ ~- ~
+' < ' Y
... ,_ ~ _
_ .. ......, .. _
~~# of Required~-
~ ~
'v.s z ~' k~2~.~i. ~ ^~ v~~,. ~`~~,,.s.{
}Affordable~.l~n~ts~
: ~#~ '~y ~ ~ "~ ~- -~z~~.~' -
.y 4~j'~.~ ~,~ tf-~ ~ '~
~
5 `~
~` t~- a ~_ _~i ~ ~,
. .~.., ,. . .
"F g
ract~on 4E1~~ ~bl~
y~t '-n-~~~~s9A~ ~"'~S'$~3k+~`.
~~`or Feg,~P~~lmer~t`
N ~.~~s°~ ~~ .~'-~~ ~'~~ .
~~~-~__} ~ Y" ~'~~ ~ ~ X ~" ~ y
u d +
: ~ ~~"~~,~`~Y~,-~
~
_. _,....,..~_. , ....
3 or less Onsite or Offsite Units not required; may pay Affordable Housing Fee
4 20% 0.80 1 0.00
5 20°~O 1.00 1 0.00
6 20°r6 1.20 1 0.20
7 20°~ 1.40 1 0.40
8 20% 1.60 1 0.60
9 20°~ 1.80 2 ~.00
10 20% 2.00 2 0.00
11 20°~ 2.20 2 0.20
12 20% 2.40 2 0.40
13 20°,6 2.60 2 0.60
14 20°k 2.80 3 0.00
15 20°~ 3.00 3 0.00
16 25°k 4.00 4 0.00
17 25°~ 4.25 4 0.25
18 25°~ 4.50 4 0.50
19 25% 4.75 5 0.00
20 25°~ 5.00 5 0.00
21 25°k 5.25 5 0.25
22 25°~ 5.50 5 0.50
23 25°~ 5.75 6 0.00
24 25°k 6.00 6 0.00
25 25°k 6.25 6 0.25
26 25°r6 6.50 6 0.50
27 25% 6.75 7 0.00
28 25 % 7.00 7 0.00
29 25% 7.25 7 025
30 25°k 7.50 7 0.50
31 25 °~ 7.75 8 0.00
32 25% 8.00 8 0.00
33 25 % 8. 25 8 0.25
34 25% 8.50 8 0.50
35 25 °~ 8.75 9 0.00
36 25°r6 9.00 9 0.00
37 25°~ 9.25 9 0.25
38 25°r6 9.50 9 0.50
39 25°~ 9.75 10 0.00
40 25°~ 10.00 10 0.00
f:\atty\muni\strpts\mjm\affordablehousingreport3attachC.doc
ATTACHMENT D
;~nr~lyz~3. ,~dvisc_ Act.
HAMILTON, RABINOVITZ 8i ALSCHULER, INC.
Policy, Financial8c Management Consultants
MEMORANDUM FOR: Barry Rosenbaum, Senior Land Use Attorney
MEMORANDUM FROM: Paul J. Silvern
SUBJECT: Preliminary Assessment of On-Site Inclusionary
Requirement Financial Feasibility
DATE: May 17, 2006
At your request, Hamilton, Rabinovitz & Alschuler, Inc. (HR&A) has completed a
preliminary assessment of the degree to which it would be financially feasible for developers of
new, market rate condominium projects to include affordable units in a new construction
project.l Consistent with your direction, we have limited this assessment to four illustrative R2
District prototypes - a one lot and a two-lot scenario on sites located north of Wilshire
Boulevard; and a one lot and two-lot scenario located in the central part of the City of Santa
Monica ("City"). The assessment reflects our general familiarity with development costs,
condominium sales prices and minimum thresholds of developer feasibility, based on related
prior work we have performed for the City in the past, and a limited degree of research on
current market conditions. This analysis can be further refined in response to the City Council's
policy direction to staff.
Our assessment involved constructing a fmancial feasibility simulation model for a"base
case" version of each scenario that includes only the maximum number of market rate units
allowed by current zoning regulations (i.e., five units for the one-lot scenarios and 10 units for
the two-lot scenarios). We than modified each scenario to include 20 percent of the allowed
units as for-sale units affordable to low-income households, defined as those that earn 60 percent
of the Los Angeles County area median income. For the one-lot scenarios this means one
affordable unit, and two affordable units for the two-lot scenarios. The inclusion of the
affordable units triggers the new 35 percent State density bonus requirement and provision of
incentives/concessions consistent with the City's Density Bonus Interim Ordinance.
' In this context, financial feasibility is an assessment of the point at which a City program, individually or
in combination with other City programs, imposes costs to a degree that would cause well-informed and experienced
developers not to proceed with an otherwise financially viable, typical multi-family housing project.
2800 28"' Sz~xEE'r, Sui~ 325, SANTA MONICA, CEv,iFO~ 90405 •'I~t: 310.581.0900 • F.v~: 310.581.0910
Los Angeles No. Califomia Washington, D.C New York
Our test for "feasibility" uses the same "gross margin" benchmarks we have utilized in
previous analyses of this type. That is, the ratio of profit to gross sales proceeds, where "profiY'
is equal to gross sales minus cost of sales minus total development cost. For total development
cost, we have used an abbreviated schedule of assumptions for land cost, construction cost,
"soft" costs (e.g., professional fees) and fmancing costs. "Asking prices" for condominiums are
assumed to be $800 per square foot for the scenarios located north of Wilshire Boulevard (i.e.,
$1.1 million to $1.2 million for a 1,400 net s.f. unit) and $700 per square foot for the scenarios
located in Mid-City (i.e., $966,000 to $1.0 million for a 1,400 net s.f. unit). These prices are
based on our review of recent condominium sales in recently completed projects and
conversations with local real estate brokers. The price for the affordable units is assumed to be
$130,289, based on the calculation procedures specified in the Administrative Guidelines for the
Affordable Housing Production Program. Other principal calculation assumptions are included
in Table 1 and Table 2. Table 1 presents the "base case" for each scenario (i.e., 100% market
rate units). Table 2 presents the scenarios in which 20 percent of the base units are affordable
and the density bonus units are also included.
Based on these four illustrations, we conclude that it would be financially feasible for
developers to include 20 percent of the units in a one-lot condominitun project as affordable (i.e.,
one unit), and 20 percent affordable in a two-lot project, provided that: (1) market rate units sell
at prevailing asking prices typical of new construction in each neighborhood tested; (2) the
developer takes advantage of the density bonus process recently adopted by the City Council to
obtain a somewhat larger development envelope; and (3) the measure of "feasibility" is a gross
margin equal to or greater than 15 percent.
HAMILTON, RABINOVITZ & ALSCHLTLER, INC. Page 2
Tabie 1
Base Case Condominium Scenarios
Scenario 1 2 3 4
Location No. of Wilshire No. of Wilshire Mid-City Mid-City
# Lots 1 2 1 2
Development Type Townhouse Stacked Flats Townhouse Stacked Flats
# Units 5 10 5 10
Market Rate 5 10 5 10
Afforable - - - -
Gross Bldg. Area 7,800 15,000 7,800 15,000
Net Units Area 7,176 13,800 7,176 13,800
Land CosUSF land $225.00 $225.00 $150.00 $150.00
Hard CosbS~ btdg. $160.00 $160.00 $160.00 $160.00
Subt. Parking/SF bldg. $37.02 $40.25 $37.02 $40.25
Soft Costs 20% x Hard + Land 20% x Hard + Land 20% x Hard + Land 20% x Hard + Land
Financing Costs' Calculated Calculated Calculated Calculated
Land Cost $1,687,500 $3,375,000 $1,125,000 $2,250,000
Hard Cost $1,248,000 $2,400,000 $1,248,000 $2,400,000
Subt. Parking Cost $288,750 $603,750 $288,750 $603,750
Soft Costs $644,850 $1,275,750 $532,350 $1,050,750
Financing Costs 234 322 569 303 193 443 468 897
Total Development Cost (TDC) $4,103,422 $8,223,803 $3,387,543 $6,773,397
Sale Prices
Market Rate (per net SF) $800 $800 $700 $700
Affordable (each) NA NA NA NA
Sales Expense (°/a x sales) 5% 5% 5% 5%
Gross Sales
Market Rate $5,740,800 $11,040,000 $5,023,200 $9,660,000
Affordable NA NA NA NA
Less: Sales Expense - 287 040 - 552 000 - 251 160 - 483 000
Net Sales $5,453,760 $10,488,000 $4,772,040 $9,177,000
Less: Total Development Cost (TDC) -$4.103.422 -$8.223,803 -$3,387.543 -$6.773.397
Profit $1,350,338 $2,264,197 $1,384,497 $2,403,603
Gross Margln 23.5% 20.5% 27.6% 24.9%
Feasible 'rf 15%+ YES YES YES YES
' 85% loan to value; 12 or 16 mos. construction; 7.5% interest rate; 65% out; 1.5% loan points; 0.75% other financing costs.
Source: HR&A, Inc.
HAMILTON, RABINOVITZ & ALSCHLJLER, INC. Page 3
Table 2
20°!o Inclusionary Condominium Scenarios
Scenario 1 2 3 4
Location No. of Wilshire No. of Wilshire Mid-City Mid-Ciry
# Lots 1 2 1 2
Development Type Townhouse Stacked Flats Townhouse Stacked Fiats
# Units 7 14 7 14
Market Rate 6 12 6 12
Afforable 1 2 1 2
Gross Bldg. Area 8,982 16,860 8,982 16,860
Net Units Area 8,266 15,512 8,266 15,512
Land CosUSF land $225.00 $225.00 $150.00 $150.00
Hard CosUSF bldg. $160.00 $160.00 $160.00 $160.00
Subt. Parking/SF bldg. $40.92 $48.27 $40.92 $48.27
Soft Costs 20% x Hard + Land 20% x Hard + l.and 2Q°1o x Hard + Land 20°1o x Hard + Land
Financing Costs~ Calculated Calculated Calculated Calculated
Land Cost $1,687,500 $3,375,000 $1,125,000 $2,250,000
Hard Cost $1,437,120 $2,697,600 $1,437,120 $2,697,600
Subt. Parking Cost $367,500 $813,750 $367,500 $813,750
SoftCosts $698,424 $1,377,270 $585,924 $1,152,270
Financing Costs 253 790 500 465 212 910 1 706
Total Development Cost (TDC) $4,444,334 $8,764,085 $3,728,454 $7,332,326
Sale Prices
Market Rate (per net SF) $800 $800 $700 $700
Affordable (each) $130,289 $130,289 $130,289 $130,289
Sales Expense (% x sales) 5% 5% 5% 5%
Gross Sales
Market Rate $5,932,800 $11,049,600 $5,191,200 $9,668,400
Affordable $130,289 $260,578 $130,289 $260,578
Less: Sales Expense - 303 154 - 565 509 - 266 074 - 96 449
Net Sales $5,759,935 $10,744,669 $5,055,415 $9,432,529
Less: Total Development Cost (TDC) -$4.444.334 -$8.764.085 -$3.728.454 -$7.332.326
Profit $1,315,601 $1,980,584 $1,326,961 $2,100,203
Gross Margin 21.7°/a 17.5% 24.9% 21.2%
Feasible if 15%+ YES YES YES YES
~ 85% loan to value; 12 or 16 mos. construction; 7.5% interest rate; 65% out; 1.5% loan points; 0.75% other financing costs.
Source: HR&A, Ina
HAMILTON, RABINOVITZ & ALSCHi1LER, INC. Page 4
ATTACHMENT E
B8 MONDAY, MAY 15, 2006
~~ ~OTICE OF PU~LIC NEAR~NG ~EFORE
~ T~E SANTA MONICA CITI( COUNCIL
Ka~~i. Nwnfa~` .
SUBJECT: Consideration oi potential amendments to the City's Aflordable Housing ProducUon
Program which would require onsite or offsitE affordable units for new mullifartdly
housing devefapments oi four or more unifs.
WHEN: Thursday, May 25, 2006 (previousty scheduled tor May 9th)
5:45 P.M.
WNEAE: Santa Monica Ciry Hall, Council Chambers, Room ~'213
1685 Main Street
San1a Maiica, Caiitornia
PROJECT DESCRIPTION
7he Ciry Council will conduct a public hearing regarding potential amendments to the Ciry's
AHordable Housing Production Program which would require the onstle or oflsite development
oi attordable housing units In ooniunction wilh new multitamiiy developments of four or more
units. The potential amendmeats voould estabiish three opi'rons. The first option would provide
lhat for deveiopments o1 tour to fiHeen uniis, 20 percent oi the lotal uniis shaN be affordable to
low income households, and in developments oi 16 units or greatsr, 25 percertt o( the total units
shaii be afto~dable to low income househoids. The second option would permit a developer !o
restrict ail the unlis In a development to moderate income households. The third option woutd
aliow developers io construct the afiordaMe units oftsite so long as !he otisite units are within
orre-quarter miio oi the market-rate development and the number ot ottsite af(ordable units is
twice tha number of onsite units that would have boen requlred. The City Council commenced
consideration oi this matter on May 17, 2005 and on that date approved a motion directing City
statl to rerorn to the Ciry Council wiih these amendments to the Affordabie Housing ProducGon
Program for Counpl consiAewtion.
HOW TO COPAMENT:
The City of Santa Monica encourages public comment on this matter. You or your
representative, or arry other persons may comment at the City Council's public ~earinq or by
writing a letter.
Letlars should be addressed to:
Mayor and City Councit
City Hail
1685 Maln Street
Santa Monica, CA 9Q401
MORE INFOHINATiON
Further information may be obtained from lhe City Housinq 8 RedevelopmeM Division at ihe
address above or by callin9 (310) 458-8702.
The meeting facility Is handicapDed accessible. If you have arry special oeeds such as sign
lan9uage iMerpreting, please contact me OHice ot'the Disabkd ai (370} 458-8701.
Pursuant to California Gavernment Code Section 65009~b), i( this matter is subsequently
cha(fenged In Court, the challenge may be limiled lo only those issues raised at the P.ubiic
Nearing described in this notlce, or in written correspontlence delivered to the City of Santa
Monica, at or prior to me Pubtic Hearinq.
ESPANOL
Eslo es una noticia de una audiencia publica para aumentar una tar+fa sobre el desarropo de
alojamiento "multi-familiar" en Santa Monip. Si deseas mas intormacihn, tavor de Ilamar a
Lupe Madrid en la ~Ivisidn de Vivlendas y Desarrollo al numero (310) A58-8702.
LOS ANGELES TIMES
HEL.P lJS ?'A9CE DIABET~S RESEARCH
T'O T~BE NE7CT LE1/EL.
JOIN OUR RESE,4RCH STUDY.
We are looking for men and women to participate
in clinical research to test an investigationa{
medication for the treatment of diabetes. You may
qualify to participate if you:
a are 18 -70 years ofd
0 were diagnosed with type 2 diabetes at least 3
months ago
o treat your diabetes with diet and/or exercise OR
stabie metformin monotherapy
• have not taken lipid towering drugs like statins
or fibrates in the last 3 months
The study lasts approximately 19 weeks and
inclucles 10 visits to the clinic. Qualified study
participants wifl not be charged for study-related
office visits, medical evaluations, or study
medication. .
66~ LONG ~~V~ Y~U ~EEN T~NpIN~tNG
~~~~~ ~ ~ ~~~l~~~~ r99
B8 FRIDAY, MAY b, 2006
LOS ANGELES TIMES
i ..•-
_ .
~. . ~M,~. ...._...~]non I c1tAr.T~ ..._:_
~ .. ... _... ,
~-°~ NOTICE OF PUBlIC HEARiNG ~EFORE
~ ~ r TH~ SANTA M~NICA C1TY C~UNCIL
~ ~ SUB.IECT: Considerafion oi potentlal amendments to the Ciry's Aftordable Housing Productlon
Program which wouid require onsite or oflsite attordable units for new multifamily
housing developments ot four w more unNs.
, WHEH: 7hursday; May 25, 2UU6 {previousry sche0uled tar May 9th)
5:45 P.M.
-~ WHERE: Sank Monip Ciiy Nail, Council Chambers, floom f213 ~
1685 Maln Street
Santa Monica, Calitomia ,
PflOJECT DESCRIPTIQN
~, 1'he Cily Cooncii witi conduct a. pubiic hearing regard'mg potentiai amendments ta ihe Ciry's
Aftadable Housing Productian Program which would require flie onsite or ottsite development
i, ot aftordabie housinp units in conjunc[ion with nevd multifamiiy develnpments of faur pr mo~e
~ unfts. The potenUal amendments would establish three optfons. The first option would pmvide
that for developments ot four io fiReen unEts, 20 percent of the total units shall be aHo~da0le to
''' low income househoMs, and in devefopments at 16 units or greater, 25 perceni ot ihe iotal untts
~,. , shatl be atSmdabte to.lovi income househoWs. The second option would permit a developer 20
_ rasfrict all the uaits in a development to moderate income househalds. The thfrd nption wnuld
aliow devebpers to consiruct the attordaDle units offsHe so fong as the ot(site units are wilhin
one-quarter mile of the market-rate devebpment and the number of ohsite affordable units is
-wice the number ot onsite un8s that would have been required. The Ciry Council commenced
`cansWeration of this maKes pn May 77, 2005 and on that date approved a motlon directing City
staft to return.to the Gity Council with thesa amendments to the AffadaWe Housing ProducHon
Program tor Councfl consideration.
HOW TO COtAMEHT: ~
The City of Sante Monica encourages public comment on thls matter. You or your
represemative, or any oiher persons may commeM at the Ciry Council's public Bearing or by
wrAing a ~etter. ~
Letie~s should Oe addressed to:
AAayor and.Ciry Cou~il
City Hall .
7685 Main Street
Sama Monica, CA 90401
MDRE INFOAblATfON
Funher informafion may be obiained trom the Ciry Hausinq & Redevelopment Division at the
' address ebave or by caliing (310) 458-8702.
The meeting tacility is handicapped accessible. If you have any specfal naeds such as stign
language interpreting, please contact the Oflice ot the Disabled at {310) 45&6701.
Pursuant to Calffornia Government Code Section 65009(b), H ihis matter is subsequent7y
chatlenged in Court, the chaUenge may be timited to or~iy those issues raised at ihe Public
Heating described in this notice, or in written correspondence deGveretl to the Gily ot S~ma
Morrica, at or priorto 1he Pubitc Hearing.
ESPAl~U!
Esto es una noticia de una audiencia p~blka para aumentar una tarNa sobre ei dasarroHo de
alo~amiento "mu4ti,-tamiliar" en Santa Monica. Si drseas m5s informad6a, tavor da Namac a
Lupe Maddd en la Divisi6n de UvienOas y Desarroilo al n8mero (310) 458-8702.
~~wx,; :; ,,r ~ .~. "'~``°' ~ -.r
. ~=ti~~=-"r.; r "
~
~~.`:~!~!'~.:~QiT Z__~:l1L]C'~ :
years, ~ts staffhas quadxupled to: ..
Dfsney and both them~
about; 20,000: Meanwhiie; the: :: '
.
pool of; surrimer job Candldates : ` D7sney Resort.'employn~e
has sfirunk because Of low unem- ; .' Estimated; tiy decade;;:;::::: :
ployrrieht rates. . ' `
Disneylandhasbeenforcedto 20,000 ..::.........._..:.........:.;...,
recivit more ereatively and ag-
gressively. This year, for the Slrst :
time.theresortisofferinginterri-' '
shfps that allow students to earn' 15,000:• ::.....:.::....::::....::.:::.....
college credit for warIring~ and :; ,:.. . , .. . :.. ; : . 12,0
Gaidng courses, at the park, ac-;. .` .
~
cot+ding to guidelines by an ac- . io,ooo:.:.::-.i.:_;.::.:-•-:::~:::;:.
crediting organizataon. 7,000 '
Interns can earn ~ up to six.' :` . 6,000 `
credits for seven months of work 5,000 :.::•••••<•
and up to three credits by a~
tending eight-week marketing . : , .. .. 1,300
and leadership ciasses taught by : :: ... o
Dlsriey.
` In' coining weeks, DLsney re :.
1955 1975 1985 19
CJ1]I~CI'3 Wlll Vj31t AYIOll~i 50 C01> ., . NOTE: Fig~ire for 1965 fs unavaila
~ 1~S 3Tld universitles 111 .
Southem California About 200 . . Source: Dianey Resorl. Cyraphi
; Tenorecnyb~ n.,os ~os~aa
n
students .w11 be accepted into ;< r.~ eR
the first intern class, which runs.: :
fi~om M~y to Aecember. About ney World interns. wh
three dozen have been chosen al= :: summer jobs into caieer
ready., ney management. Gary
Patterned after a successfiil tf, Disneyland's food an
program at. Florida's Watt Dis- ~ age.manager, began a5
ney Wodd, Disneyland'a intem- . Cntise sldpper during hif
ship is uruque among 3outhem . more yesr as a Northern.
Californ~a's biggest theme parks, ' University sLudent.
all of which struggle to fill suzr% "The college. progra
mer openings. perfect for me," Maggetti
When Aisneyland recruiters . got exposure to all the int
sell their new program to candi- of the resort, and I learn
dates, they point to severat D1s- about guest service and ~
i
Driver Charged
in PCH Crash
That Killed 2
By AItIN CrEN CER'.'
TYmes StqJJ'bv~r3ter .
A 40-yesi-oId Orarige Coiinty
motorlst has been ctiarged wlth
two'counts of misdemeanor ve-
h:n,.i.... ..... _ _...,. .. .
2 Mari
,, ,`
~
> ~ 'x ~
- _ .~
',ti ; y
_ _ _. . ... r.' . .._ _.
j '; i
.:.-~..__.___._.;:~ . ~
B6 THITRSDAY, MARCH 1B, 2006
LOS ANGF.7.T:c mT~,rz+~ ~~
. _. .. :
w~ ~
_....
The,bultet fired at Velasquez ---._._...
punctured a m~jor artery in hls
leg and he bied to death, Wood-.
ward said.
Cortez said Woods may have
been prompted by an "economic
motive" but gave no fiuther de-
tails.
He said pallce have na evf-
dence that Woods was connected
to the restaurant, its employees
or any of its customers. The act
had the marks of "a random act
ofviolence,°' Cortez said.
Norton said the events un-
foided quick~y. "It was over in a
matter of seconds," he said. A se-
curity camera captured the en-
tire episode on videotape.
PIsmo Beach 3s a cliff-side
beach toum of 8,600 people, riorth
snoc~cuig~ t..,.:~....~,~.. _~.. _r. --- ~
could hear the shots from his car
-- "quit~ a few of thezn" - and
pulled wer to see people pouring
out of the restaurant.
"They were saying, `Oh my
GodS Oh uyy GodS' " he said,
Times stafjphotographer 5te-
ghen Osmond a~ed stajf writer
Jill Leovy contrabuted to this re-
por~
which ~are tainted by irrlgation
water, as well as in human breast
milk and baby formula.
Out of 33 samples of millt pur-
chased in I,os Angeles and
Orange counties in 2004, per-
chlorate was found in aR but one,
according to tests by the Envi-
ronmental Working C3roup, an
environmental health advocacy
agena ,o•
priate agt
"It's ti
up and
and i~ts
Perchlo
dren at
Rezte2
Working
talned t
j NOTICE OF PUBtiC HEARIR6
` •--» BEFOAE THE SAHTA MOHICA CI71i COIINCIL
SUBJECT: Gonsideeration of poten~al amendmeots to ihe Cit~s Atlordable Housing Aroductia~ Pmgram which
woob require orisite or otlsite aftoNaMe units for ne~v mul6tamify fausing develop~nis of four ar more unils.
• • r e o - ~ •
WNEN: Tuesday, Apr@ 25, 20~, 6:45P.M.
;I1 ~• ' I 1 1 I• 1'~'
WHERE: Sartta A4oaica Cdy H~i, Counal Chambers, Rown #213,1685 Main Streat, Santa Mauca, Califorroa
a~~
Have you eve~ been a smoker or YES NO ppO~CT OESCRIPT~ON ~a~°g:
how s
exposed to 2nd hand smoke? ~~ The C~y Counce vn11 conduct a pub~c hearing regarding poten~al amendments to the Gtys Affordable Housing
PruducGon Program which ~rould require'the o~ite ar otfs~te devebpment of affordaMe housing units in d~~av :
Do you have a family histoty of heart disease? ~~, ~i~~h~ with new multtl~niy developmenis oi fa,r a more unas. The patential amenaments would free re;
cstabiish three opho~s. T~e first option wouW provitle that for develo~menis of four to fAteen units, 20 percent Drugs '
ls there a history of cancer In your family?
^^ oi U~e total un~s sMall be affardab~ ta bw income households, and in devdop~nts of 16 un~s or greaisr, 25
p¢rcent ol ihe total unfts slraU be afforGable ta lovr income Irous~wlds. The second option wodd pwmit a T~~d `
a~d c6ncemed.
Are ou over fort ears of:a e
J
Y Y a~~r to resutct a{I the uni~.in a devetopment ro maderate incame housdialds. The third option wou~d
i
i
'
'
o
'
,
:
Y
"
' ~ ~ ~
al~Y devebpers
tn
i
nsiruct the attwdaMe unils oilsRe so bng as the oifs
te units a~e v~hin o~+e qaarter m ~
. ourfiealth? ;
':
about the, eneral state:of
9 Y
of tf~ merrket-rate deuekpmenf and ihe numtier of ot(site afladable units is M~ce 1he number of ons~e units
r~ yeu ansxrered,°ves (o any,oitaesa quesiions yarr snaum cons~dera st'scan trom PoMS; ` fhat eroultl have been required. The Ciry Ca~nc~ commenced cans+deraGon ot ihis matter a~ May.17, 2005 antl
un ihai date approved a motion directing Cilq staff to retum to ihe Ciry Council wrth t~ese amendments to the
~
~
. AftardabN Housing Pro6uction P~agram for Councii cansidera~ioa ~T~ ;
1
~
' j
HOWTO
COMA'~NT:
'
+• ,
.
Tfie (~ty of Santa Monia encou~aga puMic eomment on this mattec Yau or ywu represemative, or amr dher
~' per'sans roay car~t at the CEy Couocp's pub6c hearing a by wriHng a kttec ~~ ;
~ s e ~ ~ • lette~sshouidbeaddressedta MayeraR~CityCoaecN ~~~,
i . Clty!l811,1b&5lb~aiaSlreet ~q
s~~onr~, ca~er co„
` 866~GET•POMS
~ '$~6~4~8~~TSG?
M
• ~OREINfDAMATION
Further informa6on may be abW~eed irom the City Housing & Redevelopment Divi~on at the address above or
Dyailinp(310jd58-8702 Prebid :
&
~ ' geye~~y ~j~~g The meeting taciliry is hamiicapped ~cessiMe. It you have any special neeGs such as siqn langu2ge
M~rin~ de! Rey interpret'mg, ~ease contad the Ofliee af the Disabted at (310) 456-8701.
Pursuanl to Ca~fomia Government Code Section 65009 (b), d tha matter is subsequenty chapenped in Coud,
PEACE OF MIIUD• SCANS North Hollywood tt~ challenqe may be Nmifed to oMy those issues raised at the Pub~C Nearing descr~ed in this no~ce, ar in ~~
Pasadelta writteo conesponderxe deGvered to Ihe C~y ol Santa Monica, at or prior to the.Pubr~ Neanng. ~;
Ofange County
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