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SR-04-14-2015-4A - 400-004/400-001-10City Council Meeting: April 14, 2015 Agenda Item: 4-A To: Mayor and City Council From: David Martin, Director, Planning and Community Development Subject: Study Session on the Draft Zoning Ordinance, Proposed Land Use and Circulation Element Amendments, Draft Official Districting Map, and Draft LUCE Land Use Designation Map Amendments Recommended Action Staff recommends that the City Council review, comment, and provide direction on the following: 1) Draft Zoning Ordinance; 2) Proposed Land Use and Circulation Element ( "LUCE ") Amendments; 3) Draft LUCE Land Use Designation Map Amendments; 4) Appeals of Planning Commission Denials of Specified LUCE and Designation Map Amendments; 5) Draft Official Districting Map; and 6) Negative Declaration. Staff further recommends that Council direct staff to return on May 5, 2015 with a Zoning Ordinance for 1St reading, LUCE amendments, LUCE Land Use Map amendments, and the Official Districting Map. Executive Summary Since December 2013, the City has been engaged in an extensive public review process to update the City's current Zoning Ordinance and related land use chapters of Article 9 of the Santa Monica Municipal Code. This process has involved 33 Planning Commission public hearings, including a Town Hall meeting, to review and discuss the Draft Zoning Ordinance, potential LUCE amendments, potential LUCE Land Use Designation Map amendments, the proposed Official Districting Map, and the environmental analysis for this project. 1 This report provides background on this sixteen month process and then focuses principally on those issues which generated significant community discourse throughout these proceedings and which, in many instances, continue to elicit strongly -held, diverging opinions. These issues are being presented to Council for further discussion and to facilitate consensus on the Ordinance recommendations. These issues include: • Determining residential density • Location and standards for child care and early education facilities • Treatment of existing hotels in the R2 /R3 • Multi -unit density limitations • No story limitation for 100% residential projects above the ground floor • CUP requirements for office uses on the boulevards • Development on multiple parcels • Tier 2 community benefits • Legal non - conforming use provisions • Parking, loading, and circulation standards • Auto dealer standards • Medical Marijuana dispensaries • Major modifications for Landmarks /Structures of Merit • Neighborhood Conservation Overlay District Additionally, there are 11 proposed LUCE amendments for Council's consideration, including but not limited to, Wilshire Boulevard activity centers and Tier 3 development standards. The latter three amendments relate only to current LUCE provisions and are not incorporated in the Draft Zoning Ordinance. Staff will be prepared to discuss any other aspect of the Draft Zoning Ordinance, proposed LUCE amendments, and related documents as the Council determines appropriate. Based on these discussions, Council may identify additional potential revisions to the Draft Zoning Ordinance and additional information it may wish to receive prior to the first reading of the Ordinance scheduled for May 5, 2015. The Draft Zoning Ordinance is Attachment A. K Background On July 10, 2010, the City Council adopted the LUCE. It was the culmination of a multi- year planning process that commenced in 2004 and substantially revised the City's land use, policies, goals, and standards necessitating a comprehensive update of the City's Zoning Ordinance, Chapter 9.04 of the Santa Monica Municipal Code. After a thorough review process that included public outreach and meetings with the community, frequent users of the current code, and various City boards and commissions, the initial public review draft of the Zoning Ordinance Update ( "Initial Public Review Draft ") was released in November 2013. Planning Commission hearings on this initial draft commenced in December 2013 and continued through October 2014 with 20 Planning Commission hearings on the Initial Public Review Draft and related documents, during which time the Planning Commission preliminarily reviewed all of the Draft's provisions. Based on the Planning Commission's discussions, public comments, and continued staff analysis, hundreds of redline edits were made to the Initial Public Review Draft. On October 22, 2014, the Zoning Ordinance Update Redline Public Review Draft ( "Redline') was released (Attachment B). The Public Correspondence Chart (Attachment E) and the Zoning Ordinance Cross Reference Chart (Attachment F) were also released on the same date. A Town Hall on the Redline was subsequently held on November 19, 2014. This Town Hall meeting, with over 200 people in attendance, was conducted under an untimed, open comment format. The Planning Commission commenced its formal review of the Redline on December 3, 2014, conducting a total of 11 hearings, during which time major additional modifications were preliminarily approved ( "Greenline Modifications ", Attachment C). On March 4, 2015, the Planning Commission adopted a resolution recommending to Council approval of the Redline as modified by the Greenline Modifications. At this same meeting, the Planning Commission considered six potential amendments, described in full on pages 7 and 8 of this report, to the LUCE and recommended to Council that it adopt five of these amendments. Subsequently, on March 18, 2015, the Planning Commission considered five additional potential amendments, described in full on pages 8 and 9. It recommended that the Council 3 adopt two of these amendments. The Planning Commission also considered and recommended that the Council adopt a new Official Districting Map ( "Zoning Map ") and amend the LUCE Land Use Designation Map ( "Land Use Map "). The Planning Commission's decisions not to recommend four of the proposed LUCE amendments and not to amend the Land Use Map designation of certain parcels in the downtown, have been appealed to Council by Planning Commissioners and members of the public. Although the Draft Zoning Ordinance represents a significant change in format and style from the current Zoning Ordinance, it largely carries forward the existing substantive regulations governing development in the City, particularly as these regulations relate to development in the City's residential neighborhoods, as well as related regulations including the Affordable Housing Production Program, Architectural Review, the Child Care Linkage Program, and the Transportation Impact Fee Program. Indeed, most of the fervent opposition to the proposals during the Planning Commission hearings did not focus on the Draft Zoning Ordinance. Instead it focused on certain existing LUCE provisions, primarily Tier 3 and Activity Centers, that are not directly addressed in or implemented by the Draft Zoning Ordinance. However, each of these LUCE provisions is before Council for its consideration. Structure & Content of the Draft Zoning Ordinance ( "Attachment A ") The Draft Zoning Ordinance is organized into five divisions. Each division contains chapters covering specific topics. The table of contents for the Draft Zoning Ordinance and other land use and zoning - related matters provides the complete list of chapters within each division. Division 1 — Introductory Provisions. This Division includes Authority and Applicability regulations, and Rules for Measurement, such as measuring height and floor area, to assist in understanding and administering the Zoning Ordinance. Division 2 — Base and Overlay Districts. Division II establishes district specific standards, including use allowances and restrictions, height and density limits, and C! other development standards. The presentation of information in this Division represents a notable change from the current Zoning Ordinance. Regulations are largely organized in a chart format with districts grouped together by category in order to improve usability of the document. Division 3 — General Regulations. Division III includes regulations that apply to all development such as height exceptions, setback projections, and outdoor living area, as well as regulations applicable to certain types of uses, including parking requirements, auto dealership standards, and alcohol sales. Division 4 — Administration and Permits. Division IV includes provisions for different types of permits and other regulatory mechanisms and activities, such as Conditional Use Permits, Development Review Permits, Development Agreements, specific plans, and Zoning Ordinance amendments. Furthermore, new permit types such as Minor and Major Modifications, Waivers, and Minor Use Permits are included. Division 5 — General Terms. Includes use categories and classifications, which define the types of uses regulated in the Zoning Ordinance, and other definitions for terms used through the Ordinance. This represents a significant expansion and reorganization of similar information in the current Zoning Ordinance with intent to capture a broader variety of uses and to clarify definitions to minimize the need for interpretation. Division 6 — Related Provisions (Attachment D). These chapters are land use and zoning - related and include the Transportation Demand Management ( "TDM ") Program, Architectural Review, Landmarks and Historic Districts, and the Affordable Housing Production Program. As is currently the case, these chapters would continue to be included in Article 9 of the Municipal Code but would not technically be part of the Zoning Ordinance itself. In large measure, these chapters have not been altered other than to reflect the new numbering system being utilized. However, changes have been made to comport with State law, to be consistent with new provisions in the draft Zoning Ordinance, to implement the LUCE, to correct clerical errors, or to clarify ambiguity. Of 5 all of these chapters, only the TDM Program has been significantly revised because of its intricate relationship to the parking section of the Draft Zoning Ordinance. It was reviewed by the Planning Commission and included in the Redline. Other chapters of Division 6 were not reviewed in detail by the Planning Commission or included in the Redline. Since these chapters are not part of the Zoning Ordinance, none of them were part of the Commission's formal recommendation. Because of these factors, substantive changes to these other Division 6 chapters are now shown in red. Discussion On July 6 2010, Council adopted the LUCE after over 6 years of community engagement. Since the LUCE substantially revised the City's land use policies, goals, and standards, substantive conflicts arose between the City's Zoning Ordinance and the LUCE. Hence, after adoption of the LUCE, the City commenced a comprehensive update of the City's Zoning Ordinance. This is the first comprehensive update since 1988. The overarching objectives of this update are to ensure that it is consistent with and implements the policies and objectives of the LUCE, addresses administrative and interpretation issues that arose with the current Zoning Ordinance, is easier to use, and clearly sets forth the City's zoning requirements. The Initial Public Review Draft was released to the public for review in November 2013. Since the Zoning Ordinance is the predominant set of municipal laws governing land use, and because land use and development issues are among the top issues of concern for the community, the update process has resulted in significant community engagement. This is reflected by the 33 public hearings (Attachment J, Commission Minutes), encompassing almost 150 hours of public testimony, 600 public speakers, and the submittal of hundreds of written comments (Attachments E and G). During this process, a number of issues were the predominant focus of community input and Planning Commission discussion. For these reasons, staff recommends that Council discuss the issues identified in this report and either confirm general agreement with the approach taken by the Planning Commission on these issues or provide direction on necessary modifications. With this 2 direction, staff will revise the Draft Zoning Ordinance and related documents accordingly for the Council's commencement of the formal review process on May 5, 2015 Planning Commission Recommendations Over the course of the extensive public hearing process, the Planning Commission reviewed and discussed the Initial Public Review Draft, the Redline, the Greenline Modifications, and hundreds of written comments; viewed multiple staff presentations; and heard testimony from hundreds of concerned community members. Given that the City has rarely conducted comprehensive Zoning Ordinance updates, and the time commitment to this endeavor was immense, each of the Planning Commissioners provided a significant and noteworthy public service. Through this dedicated effort, the Commission adopted a resolution recommending that the City Council approve the Redline as modified by the Greenline Modifications on March 4, 2015. At this same meeting, the Planning Commission considered six potential amendments to the LUCE and recommended that the Council adopt five. Subsequently, on March 18, 2015, the Planning Commission considered five additional potential amendments. It recommended that the Council adopt two. The Planning Commission also considered and recommended that the Council adopt a new Zoning Map and amend the Land Use Map. More specifically, on March 4, 2015, through the adoption of formal resolutions, the Commission recommended that Council undertake the following actions to amend the LUCE. 1. Amend the title of all "Building Height Standards" graphics in Chapter 2.1 of the LUCE to `Building Height Guidelines" to clarify that the graphics do not establish mandatory development standards. 2. Strike the following text from throughout Chapter 2.1 of the LUCE: "similar to the established stepback standards of the zoning ordinance in effect as of May 27, 2010 ". 3. Clarify throughout the LUCE that Tier 1 is baseline, by -right development up to the discretionary review thresholds established by the Zoning Ordinance. 7 4. Eliminate the requirement that Tier 2 Residential Projects and Mixed -Use Projects with Residential Only above the first floor be processed by development agreement unless the projects provide nonresidential uses above the first floor. 5. Eliminate the provisions stating that Tier 2 discretionary review be undertaken by a Conditional Use Permit and clarify that this discretionary review can be undertaken by a development review permit or its equivalent. The Planning Commission also recommended that Council adopt the Negative Declaration that was prepared for this project. On the same date, the Planning Commission voted not to recommend that Council adopt the following amendment: 6. Amend the text on LUCE page 2.1 -41 (first bullet on the left) to include the following: "and a 3 -foot height bonus above the 32 -foot base height'. Subsequently, on March 18, 2015 the Planning Commission adopted Resolutions recommending the Council approve the following additional amendments to the LUCE: 7. Establish that a project, which preserves a City- designated landmark or structure of merit in a portion of the R2 District that had historically been zoned R3, shall receive a 6 -foot height bonus, allowing for an additional floor of housing. 8. Establish that when a project would preserve a City- designated landmark or structure of merit, the project may be reviewed by a discretionary review process other than development agreement so long as the project does not exceed the FAR for Tier 2 projects. The Planning Commission voted not to recommend that the City Council adopt the following amendments: 9. Eliminate the two Activity Centers on Wilshire Boulevard located at Wilshire Boulevard/Centinela Avenue and Wilshire Boulevard /14th Street. Staff recommended, and continues to recommend, removal of these two Activity Centers. 10. Remove Tier 3 from the Mixed -Use Boulevard (MUB) land use designation in certain areas of the City or modifying the MUB development standards for Tier 3 in these areas of the City. n 11. Remove Tier 3 from the Mixed -Use Boulevard Low (MUBL) land use designation in certain areas of the City or modifying the MUBL development standards for Tier 3 in these areas of the City. Staff recommended, and continues to recommend, removal of the Tier 3 with the exception of the following MUB areas: ® Lincoln Boulevard south of Wilshire Boulevard • Wilshire Boulevard west of Lincoln Boulevard • 4th Street between the 1 -10 freeway and Pico Boulevard ® Within the area bounded by Colorado Avenue, Olympic Boulevard, 20th Street, and Cloverfield Boulevard Staff recommended, and continues to recommend, removal of the Tier 3 with the exception of the following MUBL areas: ® Broadway ® Colorado Avenue ® Within any remaining Activity Center Additional Planning Commission Recommendations In addition to the Planning Commission's formal recommendations, the Commission also directed City staff to request that Council direct staff to: 1. Initiate a planning process to create new comprehensive zoning standards for a Pico Neighborhood Zoning District which would provide additional protection to that neighborhood; 2. Identify any provisions of the new Zoning Ordinance that need revision based on the City's implementation experience and return to the Planning Commission, and Council, within one year of the Ordinance's adoption; 3. Clarify that the standards set forth in Section 9.11.030 (Active Commercial Design Standards) of the Draft Zoning Ordinance only apply to commercial properties that front the commercial boulevards and that parcels within a P commercial district which front a side street would not be required to provide Active Commercial Design. The result of this clarification would be to authorize residential uses on the ground floor of these properties and to provide for better transitions between commercial and residential districts; 4. Give careful consideration to the appropriate LUCE Land Use Designation, and resulting zoning designation, for the St. Monica's Catholic Community parcel located between Washington Boulevard and California Boulevard. City Council Discussion Issues The following issues represent topics that generated substantial discussion during Planning Commission review. This discussion generally follows the order where these issues are found in the Draft Zoning Ordinance. Determining Residential Density— Section 9.04.920 In July 2014, Council adopted interim zoning standards to modify certain multi - family residential development standards in the Pico and Mid -City Neighborhoods. This was undertaken in response to concerns regarding the need to promote the preservation of existing multi - family residential housing units and to maintain the scale and pattern of existing multi - family residential development in certain areas of the Pico Neighborhood and Mid -City Neighborhood in proximity to the Expo Light Rail line. In addition to other proposed changes discussed subsequently in this report, the Draft Zoning Ordinance would continue this approach by modifying the method of calculating residential density. Presently, the maximum number of dwelling units allowed on any site is determined by dividing the area of the site, including half the area of an abutting rear alley, by the number of square feet for each dwelling unit that is required in the zoning district in which the site is located. However, the Draft Zoning Ordinance would alter this approach in the R2, R3, and R4 districts so that no portion of the alley would be used to calculate the area of the site in these districts. By not including the alley, the overall site area would be reduced, which could have the effect of limiting the density on certain parcels depending on existing site conditions. This recommendation responds to 10 community concern regarding residential density, and would be further reinforced by the establishment of density caps, discussed later in this report. This latter standard is also consistent with the Interim Zoning Ordinance It should also be noted that rear setbacks for parcels with rear parcel lines abutting an alley are currently measured from the center line of the alley. As the rear alley provides an existing buffer between parcels, this method of determining rear setbacks has not presented compatibility issues and would remain unchanged. Child Care and Early Education Facilities in the R110121- Section 9.07.020 Family Day Care Large Standards - Section 9.31.140 Childcare and Early Education Centers Standards - Section 9.31.120 During the Planning Commission's review of the Draft Zoning Ordinance, the appropriate location and standards for Family Day Care and Child Care and Early Education Facilities were addressed in detail. Although raising many policy issues, the assessment of these issues is significantly influenced by governing State law. The State Legislature enacted the California Child Day Care Act, Health & Safety Code Section 1597.30 et. seq., in 1984 to encourage the expansion of child care services, to regulate child care services in the State, and to limit local control. Since enactment of the legislation, California Department of Social Services has changed family day care to family child care. Pursuant to the Act, a city is prohibited from regulating small family child care homes — those providing care for up to six children (up to eight in specified circumstances), including children under the age of 10 years who reside at the home. A small family child care home is considered a residential use of property and must be permitted in all zones which allow residences — including zones with single - family dwellings, apartments, and condominiums. The Draft Zoning Ordinance complies with these requirements. it A large family child care home is one that provides for care for up to twelve children (up to fourteen in specified circumstances), including children under the age of 10 years who reside at home. It must be treated as a residential use. Local regulation of large family child care homes is permitted, but is limited to only four areas: noise, parking, traffic, and spacing /concentration. A city must set forth specific standards in each of these areas and the use must be granted if the applicant meets these standards. Given these State regulations, the Large Family Day Care is listed in the Draft Zoning Ordinance as a Permitted use in all single -unit and multi -unit residential zoning districts. Standards have been established addressing each of the subject areas authorized by State law, such as hours of operation and concentration (300 feet) to ensure that this use in residential districts does not adversely impact the adjacent neighborhoods. Child Care and Early Education Facilities may be regulated differently. These facilities include infant centers, preschools, and school age day care facilities in both a full and part -day setting. State law does not pre -empt local zoning regulations of Child Care and Early Education Facilities. As such, the City may use its traditional zoning powers to regulate the location and operation of such facilities. All of these facilities are licensed by the Community Care Licensing Division of the Department of Social Services of the State of California. In the current Zoning Ordinance, Child Care and Early Education Facilities, denominated as Day Care Centers, are allowed subject to the review and approval of a Conditional Use Permit ( "CUP ") in multi - family residential districts. Child Care and Early Education Facilities are considered similar to school uses which are also currently conditionally permitted uses in the residential districts, consistent with other municipalities in the State. This approach would be continued in the Draft Zoning Ordinance. Discretionary review of any potential Child Care and Early Education Facility, along with additional standards for such uses, would provide the review body with full discretion to add additional conditions to ensure the safety of children attending these facilities and preserve the character of the surrounding neighborhoods. 12 The Draft Zoning Ordinance would allow this use throughout the City's multi -unit districts, subject to the approval of a CUP, and would establish concentration limits on Large Family Day Care that would prohibit a new facility within 300 feet of an existing facility and would restrict outdoor play hours from 8 am to 6 pm Monday through Friday and from 9 am to 4 pm on weekends for both Large Family Day Care and Child Care and Early Education Facilities within or adjacent to residential districts. The Draft Zoning Ordinance would not authorize Child Care and Early Education Facilities in R1 or OP1 Districts. City staff believe adoption of these latter restrictions are inconsistent with the City's longstanding commitment to early childhood education and the Land Use and Circulation Element adopted Goals and Policies to integrate child care and early education in to the city's land use policies. Specifically: 1. Child Care and Early Education Facilities within or adjacent to residential districts and Large Family Day Care should be allowed to have outdoor play from 8 am to 8 pm, Monday through Friday and weekends from 9 am — 4 pm. The Draft Zoning Ordinance would require Large Family Day Care to comply with noise standards contained in Chapter 4.12, Noise of the Municipal Code. It should be noted that outdoor play does not always mean loud physical activity and high quality early childhood programs employ outdoor space as a unique classroom environment. In addition, a new safeguard in the Draft Zoning Ordinance requires all Child Care and Early Education Facilities to designate an on -site contact person to serve as a neighborhood liaison to address any neighborhood concerns, including outdoor play hours. 2. State law requires Family Day Care home providers to live in their residence differentiating it from a Child Care and Early Education Facilities. Maintaining the 100 linear feet concentration in the current Zoning Ordinance continues to prevent Large Family Day Care to be on adjoining parcels. The Draft Zoning 13 Ordinance would also continue the requirement for Large Family Day Care to comply with parking, loading and circulation requirements and while the current Zoning Ordinance requires an evaluation of each Family Day Care's passenger loading plan, the Draft Zoning Ordinance would provide further protection by requiring a passenger loading plan subject to the approval of the Director. 3. Given the City's long standing commitment to early childhood and recognition that education does not begin at kindergarten, removing obstacles to the provision of child care in all residential zoning districts with safeguards would be consistent with the LUCE. The consideration to allow Child Care and Early Education Facilities in the R1 and OP1 single unit residential districts is based on the established safeguards in the CUP process. Thus, allowing Child Care and Early Education Facilities, subject to the approval of a CUP requires each application to be considered in a residential area regarding 1) site design including fences and walls, 2) adequate parking requirements, 3) passenger loading, 4) organized play activity or other impacts resulting from daily schedules and 5) lighting. This review process is in addition to the rigorous state licensing requirements for indoor and outdoor space. For these reasons, staff recommends that Council reconsider these recommended changes in the Draft Zoning Ordinance to conform to the LUCE goal and policies for supporting high quality Child Care and Early Education Facilities and Small and Large Family Day Care to meet the needs of those who live or work in Santa Monica. Modifying the Draft Zoning Ordinance to allow Child Care and Early Education Facilities as expressed in items 1, 2, and 3 above would continue to advance the City's commitment to child care and early education, which is a key component of the Santa Monica Cradle to Career (SMC2C) Initiative. Treatment of Existing Hotels in R2 1R3- Section 9.08.020 While the existing Zoning Ordinance prohibits hotels in the R2 and R3 zoning districts, it categorizes existing hotels in existence as of January 1, 1995 as permitted uses. This MA provision allows such existing hotels to remain and be rebuilt or expand consistent with the governing development standards. The Draft Zoning Ordinance would change this categorization of existing hotels from permitted to legal non - conforming. As with all legal non - conforming uses, this change would not require these uses to cease operation and such uses would be authorized to be rebuilt if damaged or destroyed through any non - voluntary event. Thus, characterizing such hotels as legal non - conforming would not alter the existing operation of these establishments, but would prevent their expansion or intensification. In this regard, these existing hotels would be in the same position as any other legal non - conforming use in the City. Such treatment of hotels is also not uncommon. All existing hotels in the City's Proposition S zone have been considered legal non - conforming since the adoption of Proposition S in 1990. R2 1R3 1R4 Density Limitation- Section 9.08.030 As previously noted, much of the discussions during the public hearings on the draft Zoning Ordinance was focused on ensuring that the City's existing residential neighborhoods were protected. In response to these concerns, the Draft Zoning Ordinance would establish density standards, consistent with the Interim Zoning Ordinance, as follows: ® Maximum Unit Density: In R2, the lesser of one unit per 2,000 SF of parcel area or 4 units total. In R3, the lesser of one unit per 1,500 SF of parcel area or 5 units total. In R4, the lesser of one unit per 1,250 SF of parcel area or 6 units total. This standard would limit the density of new residential projects more than the existing Zoning Ordinance and ensure density that does not exceed the neighborhood scale of existing multi -unit residential districts. In addition to the other neighborhood protection standards addressed earlier in this report, Determining Residential Density, other standards to address neighborhood scale and density would include establishing a 10,000 square foot Development Review threshold in all residential districts. This would reduce the existing residential Development Review thresholds, which range from 15,000 in the R2 Zone to 25,000 15 square feet in the R4 Zone. Residential parcel consolidation would also be limited to address neighborhood scale as described later in this report. No Floor Limitation for Projects with all Residential above First Floor in Commercial Districts- Section 9.11.020 The existing Zoning Ordinance has historically not limited the number of stories in a project in commercial districts if the project was designed and constructed with at least one floor of residential use above the ground floor. This provision provided an incentive for the creation of residential units within commercial zones and mixed use developments. One of the primary objectives of the LUCE is to create housing along commercial and transit rich corridors. Although the LUCE caps Tier 1 development to no more than 2 stories, with specified exceptions, the LUCE does not establish a story limitation for Tier 2 development. The Draft Zoning Ordinance would continue to incentivize housing by establishing no limitations on the number of stories for any project that provides 100% residential uses above the ground floor for the mixed use commercial districts as well as the Oceanfront District. The Draft Zoning Ordinance would establish a firm cap on the number of stories for all other development and projects with 100% residential uses above the ground floor would still be subject to all other development standards including established standards for discretionary review. Requiring CUP for Office Use in MUB/MUBL/GC /NC- Section 9.11.020 The Draft Zoning Ordinance would establish that all new medical and dental offices, general offices, and creative offices, in newly constructed buildings within the commercial and mixed -use corridor districts, must obtain CUPs. This change was intended to promote the creation of active pedestrian oriented commercial boulevards at the street frontage and reflects input received regarding traffic and parking impacts created by the frequency of visits generated by office uses, especially medical and dental office uses. WR Development on Multiple Parcels — Section 9.29.030 The Interim Zoning Ordinance also established a limitation on parcel consolidation. More specifically, the interim standards prohibited parcels to be consolidated or tied if such consolidation or lot tie resulted in a parcel that exceeded 7,500 square feet in size. The Planning Commission concurred with this approach, and in an effort to maintain consistency with existing standard sized residential parcels found throughout the muti- unit residential neighborhoods and to limit new larger and incompatible developments on multiple parcels, the Draft Zoning Ordinance would apply this standard to all residentially zoned parcels in the City. This 7,500 square -foot limitation on parcel consolidations, however, could create the unintended consequence of significantly inhibiting the development of new residential courtyard housing. Commission and public discussion has supported the creation of courtyard housing. Consequently, the Draft Zoning Ordinance would create an exception to the parcel consolidation provisions if courtyard housing is proposed that meets the minimum courtyard requirements found in Section 9.08.030(F) and would allow courtyard housing to be built based on the total maximum number of units allowed on each of the parcels prior to consolidation. Furthermore, 100% Affordable Housing projects would also be exempt from this provision. Tier Two Community Benefits - Chapter 9.23 The LUCE identified five core categories of community benefits including: • Affordable and Workforce Housing • Trip Reduction and Traffic Management • Community Physical Improvements • Social and Cultural Facilities • Historic Preservation In order to attain the community benefits, the LUCE established a community benefits structure based on three Tiers. The LUCE sets development baselines that align with lower intensity development and allow for increases in height and density within the 17 area context. The LUCE contemplated the creation of a Tier 2 regulator community benefits system in the Zoning Ordinance to ensure that medium- and larger -sized development would provide benefits to the community through a "Tier" structure of project review. In this structure: • Tier 1: Generally allows buildings up to 32 feet, with variation for on -site housing, through ministerial (staff - level) review. • Tier 2: Requires community benefits, typically through legislatively imposed zoning standards, with Planning Commission review. • Tier 3: Requires additional community benefits. With limited exception, Tier 3 development would not be authorized by the Draft Zoning Ordinance, but would be governed exclusively by the LUCE and authorized only pursuant to development agreement, a form of review that provides the Planning Commission and the City Council the most discretion in reviewing a proposed project. The Planning Commission reviewed the community benefits chapter of the Draft Zoning Ordinance on May 14 2014, August 13 2014, and February 4 2015. The proposed community benefits system would be based upon an increase in on -site and off -site affordable housing, an increase above the adopted fees for certain development impact fees, and augmented TDM requirements. A full explanation of each impact fee included in the community benefits system is provided in the May 14, 2014 Planning Commission staff report. At the first two hearings, the Planning Commission was also presented with feasibility analyses of fourteen development prototypes including commercial prototypes in Downtown and Wilshire, and mixed -use residential /retail prototypes on Wilshire, Downtown, Pico, Santa Monica, and Lincoln. These analyses were prepared by HR &A Advisors, Inc. to test the community benefits proposal and concluded that existing City impact fees could be increased by 14% for Tier 2 projects while still resulting in a financially feasible project. The community benefits system recommended by the Planning Commission addresses the LUCE priorities of Affordable Housing, Transportation, and Open Space. The recommended community benefits system attempts to include all five priority categories of community benefits identified by the LUCE, where feasible and is based on the following concepts: • Affordable Housing Production Program (AHPP) on -site and off -site option: 50% increase above minimum percentage of total units for on -site and off -site affordable housing (e.g. 5% of total units for 30% income households would increase by an additional 2.5 % for a total of 7.5% of total units affordable to 30% income households). • Affordable units must be for 30 %, 50 %, or 80% income households. • Off -site units must be owned by a non - profit housing developer and have Certificate of Occupancy issued before or concurrent with market rate units. • No more than 20% of the total number of units of the residential or mixed use project shall be studio units and at least 40% of the total number of units shall be two - bedroom or three - bedroom units. • Elimination of AHPP fee option: Tier 2 projects have no option to pay an Affordable Housing Fee. • Affordable Housing Commercial Linkage Fee: 14% above adopted fee. • Parks and Recreation Impact Fee: 14% above adopted fee. • Transportation Impact Fee: 14% above adopted fee. • Augmented TDM requirements. Adding more potential fees or exactions for capital infrastructure community benefits to the list would also require a new nexus study and may require an equivalent reduction in the fees that are proposed. Other fees for the operation or maintenance of programs, such as tuition subsidies for early childhood education, or programs supporting historic preservation efforts, are not included in the proposed community benefits system as such contributions are best negotiated through a development agreement. Moreover, historic preservation is incentivized through other provisions established in the Draft Zoning Ordinance. The community benefits system could be changed over time as other community priorities are identified or funding needs are met. At the Tier 2 level, it would likely be more efficient and legally defensible to focus on community priorities that can be addressed through physical facilities, such as parks, affordable housing, and transportation infrastructure since a nexus can be more clearly established. A more 19 detailed summary of the differences between Tier 1 and Tier 2 project requirements is in Attachment L. During the Planning Commission's review of the Draft Zoning Ordinance, the City Council considered a request to allow the reinstitution of a legal non - conforming use in a City- Designated Historic Resource. The current Zoning Ordinance prohibits the continuation of legal non - conforming uses after the use has ceased operations for a period of at least one -year. While this prohibition serves to prevent the reinstitution of uses that may no longer be appropriate in a given zone, it may conflict with other important objectives such as City's historic preservation goals. More specifically, a landmark building, if vacant for more than a year, could lose its grandparented right to maintain a historic use if zoning standards have changed. This situation could make reuse of the historic building challenging. In response, Council directed staff to address this issue in the Draft Zoning Ordinance. Staff presented this issue to the Planning Commission and an exception was added to the Draft Zoning Ordinance that would allow a non - conforming use of a City- Designated Historic Resource to be resumed, reestablished, or reopened with the approval of a Conditional Use Permit, even after the one -year timeframe has elapsed, subject to specific findings. In order to protect existing residential uses, the non - conforming use could not be resumed, reestablished, or reopened if the property was in residential use as of December 16, 2014, the date when Council first discussed this issue. Some community concern has been expressed about this date. However, staff believes inclusion of this date would protect the neighborhood by preventing a property owner of a City - Designated Historic Resource from terminating the residential use of the property in order to take advantage of this new exception. Furthermore, the Draft Zoning Ordinance includes additional findings to give the Planning Commission, and City Council on appeal, substantial latitude to consider the compatibility of use with the neighborhood, in addition to other findings to protect the surrounding area. 20 Parking, Loading and Circulation - Chapter 9.28 Chapter 9.28 would prescribe the provision, design, and use of parking, loading, and circulation on private property. This Chapter would be administered in tandem with the Public Works chapter of the Santa Monica Municipal Code to ensure consistency with the Municipal Code and compatible design between public and private property. The standards in Chapter 9.28 would both update existing Zoning Ordinance standards and add new requirements that reflect the emphasis on multimodal access and transportation demand management expressed in the LUCE. Parking requirements are a key component of private property development standards. Much of Santa Monica's commercial building stock was constructed before the current parking requirements, as is true for many multi - family residential buildings. Sufficient parking is an important issue for residents and businesses. The City has invested heavily in the creation of shared public parking resources and active management of existing parking. The LUCE identifies the need to provide sufficient parking for new and existing uses and to utilize different strategies to optimize parking resources. The Draft Zoning Ordinance would establish requirements for the amount and design of parking to ensure adequate availability and usability while maintaining the community's commitment to sustainability. The appropriate number of parking spaces to require was a primary topic of discussion through the Planning Commission process. The Planning Commission recommended that parking requirements be determined by use and whether a property is located within "Mixed Use Transportation Districts," consisting of commercially zoned properties within proximity to Expo Light Rail stations and the high service transit intersections of Lincoln Boulevard at Pico Boulevard and 4th Street at Santa Monica Boulevard, and "Residential and Commercial Conservation Districts," consisting of all other zoning districts. Properties within the former would require relatively less parking than in the latter. A parking maximum would also be established, allowing a relatively small proportion of additional parking spaces to be provided by right with the two exceptions: 1) additional parking being permanently provided as public parking or 2) replacement parking fulfilling the requirement for another use. 21 Additional provisions of the Draft Zoning Ordinance would require passenger and commercial loading based on size and use, unbundled parking for commercial development and residential developments of more than three units once the preferential parking section of the Municipal Code is amended to exclude certain residential uses from purchasing permits, and short-term and long -term bicycle parking based on size of different uses. As discussed previously, the TDM Program contained in Division VI would also be significantly revised. While the Employer sections of the TDM chapter are deeply rooted in the South Coast Air Quality Management District's (SCAQMD) Rule 2202, the Developer sections of the TDM chapter stem from Los Angeles County Congestion Management Plan (CMP) requirements. In addition to being responsible for meeting the requirements of regional air quality and congestion management agencies, the Draft Zoning Ordinance includes changes to the TDM Program that support the land use and circulation policies set forth in the LUCE. From an employer perspective, the Draft Zoning Ordinance would lower the threshold at which an Emission Reduction Plan is required from 50 or more employees to 30 or more employees; for developers the threshold for requiring an annual TDM plan would be 7,500 square feet for non - residential projects and 16 or more units for residential projects; and the intensity of TDM that is required for a project/employer would be based on the proximity to transit services with higher Average Vehicle Ridership targets in transit -rich districts. Santa Monica's TDM Program would continue to exceed what is required by the SCAQMD and CMP, and reflects feedback from the Commission with regards to the thresholds for applicability and the TDM performance targets. SCAQMD has been consulted throughout this revision process. Auto Dealer Standards — Sections 9.08.020 & 9.39.070 During the course of the Planning Commission's review of the proposed Automobile Dealerships Standards, a majority of the Planning Commission's discussion focused on the development and operational standards for existing auto dealerships that occupy adjacent residentially zoned parcels, ( "Qualifying Parcels ") and what regulations should 22 apply for new development, expansion, or intensification of the existing auto dealerships on these Qualifying Parcels. Examples of the development and operational standards examined included parcel coverage, setbacks, design standards, and allowable uses on the Qualifying Parcels. Significant discussion also concentrated on land use entitlement thresholds (Conditional Use Permit, Development Review Permit) for the expansion of existing auto dealerships on both commercially and residentially zoned lots. The Draft Zoning Ordinance would address these issues. Auto Dealerships' expansion need within the context of limited land availability and close proximity to sensitive residential uses would be balanced by protections for adjacent residential neighborhoods, as summarized below. Development and Operational Standards on Qualifying Parcels ® Increase minimum side setback adjacent to a Qualifying Parcel from 10 feet to 15 feet. • Eliminate the maximum 50% parcel coverage on a Qualifying Parcel to allow the minimum required setbacks to establish the overall maximum building footprint. • Modify the prohibition of vehicular ingress /egress to /from a Qualifying Parcel to allow vehicular access on the Qualifying Parcel at least 40 feet away from an adjacent residential use if there is only one Qualifying Parcel; however, if there are multiple Qualifying Parcels then vehicular access may only be permitted on the Qualifying Parcel that is furthest from the nearest adjacent residential lot. Land Use Entitlement Thresholds • Removal of the CUP requirement for the expansion of an existing auto dealership on a commercially zoned (i.e. allow the expansion by right). • Retain the Development review threshold of 15,000 square feet for new development. • Retain the CUP requirement to establish a new auto dealership within the GC zoning district along Santa Monica Blvd. from Lincoln Blvd. to 20t Street. • Allow the expansion of an existing auto dealership onto a Qualifying Parcel for any associated auto dealership operation (excluding Major Auto Body Repair) with the approval of a CUP. 041 Medical Marijuana Dispensaries - Section 9.31.185 The City's current Zoning Ordinance does not authorize medical marijuana dispensaries. On August 13, 2013, the City Council directed staff to explore authorizing a limited number of such dispensaries. In the Initial Public Review Draft, the proposed regulations for Medical Marijuana Dispensaries would have allowed a maximum of two Medical Marijuana Dispensaries in the non - residential zoning districts within the Healthcare District subject to approval of a Conditional Use Permit. After extensive discussion, the Commission directed staff to revise the Initial Public Review Draft to allow the two Medical Marijuana Dispensaries in an expanded area and to review the standards currently utilized by the City of West Hollywood in regulating such a use. The Redline reflected this direction and it was further amended after Planning Commission review. The Draft Zoning Ordinance would authorize a maximum of two Medical Marijuana Dispensaries subject to approval of a Conditional Use Permit, with the locations of these dispensaries limited to the following areas as identified in Table 9.11.020: ® MUB District along Wilshire Boulevard between Lincoln Boulevard and Centinela Avenue ® GC District along Santa Monica Boulevard between Lincoln Boulevard and 20th Street ® MUBL District along Santa Monica Boulevard between 23`d Street and Centinela Avenue Written recommendations from a doctor authorizing medical marijuana use could not be obtained on site, and a maximum of 15% of the total floor area of a dispensary could be used for on -site cultivation of medical marijuana. On -site sales or consumption of alcohol or tobacco would be prohibited, and dispensary owners would be required to authorize reasonable City inspection of the property by City Code Enforcement and Police staff or other agents or employees of the City to ensure compliance with the conditions of approval for a dispensary. 24 Major Modification for Landmarks /Structures of Merit- Section 9.43.100 The Draft Zoning Ordinance would authorize modification of numerous development standards (e.g. building height, number of stories, setbacks, parcel coverage), subject to specified findings, as part of a project that preserves a City- Designated Historic Resource. This provision is patterned after an existing variance procedure established in the current Zoning Ordinance. Pursuant to the draft, modification of the height standards would only be authorized if a City- designated Landmark or Structure of Merit is being preserved. Moreover, two different height modification allowances would be established: (a) six feet above the height otherwise authorized in the LUCE in the portions of the R2 District generally bound by 4th Court to the west, 14th Court to the east, Montana Avenue to the north, and Wilshire Boulevard to the south, if developed in that area, or (b) the height permitted in the LUCE for the highest tier for the applicable land use classification so long as the FAR does not exceed the limitations established for Tier projects in the same land use classification. The boundaries specified in the first provision represent areas of the City that were historically zoned R3, resulting in an existing more intensive built development pattern than seen in a historically R2 zoned area. These proposed height allowances mirror and are contingent on adoption of the proposed LUCE amendments for historic resources discussed on pp. 34 and 35 of this report. Neighborhood Conservation Overlay District - Chapter 9.47.030 A Neighborhood Conservation Overlay District (NCOD) would be an individual overlay district to the standards of the underlying zoning district. The regulations of a NCOD would apply to specifically delineated areas of the City for the purpose of identifying, conserving, maintaining, strengthening, and enhancing a neighborhood's cohesive and distinctive physical characteristics. The focus of a NCOD would be to maintain certain standards in the district, such as the broader characteristics that provide neighborhood 25 character including building heights, setbacks, massing, open space, repetition of building and streetscape elements, and landscaping. Public input regarding NCODs principally addressed the criteria for designating NCODs. Much of this discussion focused on how to determine the minimum size of these overlay districts. The Draft Zoning Ordinance would establish that the area within the district must include at least one block face. Using a minimum area of one side of the block length -wise seems an appropriate size for such an overlay district. An NCOD could be initiated by the Planning Commission, the Landmarks Commission, or tenants and /or property owners representing at least 50% of the parcels within the proposed district. LUCE Amendments Twelve possible LUCE amendments were identified by staff, the community, and the Planning Commission during course of the public hearings. Each potential LUCE amendment was initiated through Resolutions of Intention. More specifically, on November 5, 2014, December 10, 2014, February 18, 2015, and February 25, 2015, the Planning Commission adopted Resolutions of Intention to formally consider these LUCE amendments and consider making formal recommendations to Council. The Planning Commission then formally considered 11 of these amendments, ultimately recommending 7 and not recommending 4. Council will formally consider these amendments, including all the amendments which were appealed, on May 5, 2015. The following are the areas and topics of the potential LUCE amendments: ® Amendment of the title of all "Building Height Standards" graphics in Chapter 2.1 of the LUCE to "Building Height Guidelines" to clarify that the graphics do not establish mandatory development standards. Throughout Chapter 2.1 of the LUCE, graphics are utilized to illustrate building height concepts for each land use designation. These concepts include, but are not limited to, maximum building heights, minimum ground floor heights, minimum floor -to -floor heights, and building stepbacks. The figures complement the text of the standards found in Chapter 2.1 but in some cases provide numerical standards that are not identified in the text or are more rigid than the text standards. Confusion has resulted as 26 to whether the numerical values illustrated in the figures are requirements or guidelines. These figures should be treated as examples to illustrate the concepts described by the text in the LUCE, and changing the titles of these figures from "Building Height Standards" to "Building Height Guidelines" would eliminate the confusion. The Planning Commission recommended this LUCE amendment on March 4, 2015 and the Draft Zoning Ordinance reflects this recommendation. ® Amendment striking the following text throughout Chapter 2.1 of the LUCE: "similar to the established stepback standards of the zoning ordinance in effect as of May 27, 2010 ". In the non - residential land use designation sections in Chapter 2.1 of the LUCE, the development parameters require buildings to be stepped back from the boulevard above the maximum street wall height in a manner that will minimize the visual bulk of the overall building "similar to the established stepback standards of the zoning ordinance in effect as of May 27, 2010." However, the existing stepback standards significantly limit the allowable building volume envelope for buildings over 31 feet in height by requiring upper level stepbacks ranging between a nine -foot average stepback to a 27 -foot average stepback. The established standard is rigid and limits design flexibility for new buildings. As the LUCE development parameter also states that "guidelines or standards for the building mass above the streetwall shall be established in the zoning ordinance" and since new proposed standards have been crafted in the Draft Zoning Ordinance, the text referencing the established stepback standard should be deleted from the LUCE. The Planning Commission recommended this LUCE amendment on March 4, 2015 and the Draft Zoning Ordinance reflects this recommendation. ® Amendment clarifying throughout the LUCE that Tier 1 is baseline, by -right development up to the discretionary review thresholds established by the Zoning Ordinance. This amendment would clarify that only Tier 1 projects that do not exceed the discretionary review threshold identified in the Draft Zoning Ordinance are by- right. A 27 project may meet Tier 1 height and FAR standards, but could still be a large project that might not be compatible with its surroundings. Requiring discretionary review for such larger projects would allow examination of the location, size, massing, and placement of a proposed structure on the site, particularly as the project relates to the existing context of the area in which it is located. The precise discretionary review thresholds would vary between the zoning districts and would be intended to ensure that larger projects are compatible with surrounding development. While most Tier 1 projects would remain by- right, those that exceed the discretionary review thresholds would require discretionary review. The Planning Commission recommended this LUCE amendment on March 4, 2015 and the Draft Zoning Ordinance reflects this recommendation ® Amendment eliminating the two Activity Centers on Wilshire Boulevard located at Wilshire Boulevard /Centinela Avenue and Wilshire Boulevard /14"h Street. Activity Center Overlay areas are identified in the LUCE as strategic opportunities for property owners and /or the City to "foster dynamic spaces by enabling the creation of mixed -use development at transportation crossroads on parcels of sufficient size to support creative design and to provide active and passive open space, affordable and market -rate housing, and shared parking facilities ". Five Activity Center Overlay Districts are identified in the LUCE, two of which are located along Wilshire Boulevard at Centinela Avenue and 14th Street. Both of these proposed activity centers would allow development at a level that could be considered significantly out of scale with'the surrounding residential neighborhood as well as involve the conversion of several residential parcels to commercial parcels. Additionally, the initiation of an activity center at these locations would have required significant coordination and cooperation among multiple property owners, something that has been a significant challenge with other planning efforts. The potential loss of any housing or development opportunity would likely be made up by shifts towards transit hubs like Downtown /Civic Center and Bergamot. 28 There was substantial public testimony during the review of the Draft Zoning Ordinance supporting the elimination of the two activity centers at Wilshire Boulevard /Centinela Avenue and Wilshire Boulevard /14th Street. Some testimony in support of the retention of these Activity Centers was also provided. On March 18, 2015, the Planning Commission voted not to recommend this LUCE amendment. In its discussion, the majority of the Commission supported the LUCE vision to encourage housing in this manner along the boulevards as well as mixed use centers within walking distance of neighborhoods. However, this decision has been appealed by the Northeast Neighbors and Planning Commissioner Kennedy and therefore this LUCE amendment is before Council for its consideration. Since an activity center would only be established through an area plan and subsequent development agreement, the Draft Zoning Ordinance contains no standards governing potential activity centers. Staff continues to support the removal of the Wilshire Boulevard activity centers given the substantial community concerns raised regarding the potential size and scope of development in these areas in close proximity to residential areas. Further, Tier 2 standards would allow the development of mixed use projects with housing consistent with the LUCE vision. ® Amendment removing Tier 3 from the Mixed -Use Boulevard (MUB) land use designation with the exception of the following MUB areas: ® Lincoln Boulevard south of Wilshire Boulevard • Wilshire Boulevard west of Lincoln Boulevard • 4th Street between the 1 -10 freeway and Pico Boulevard ® Within the area bounded by Colorado Avenue, Olympic Boulevard, 20« Street, and Cloverfield Boulevard Through the course of reviewing the Draft Zoning Ordinance, the Planning Commission discussion and public testimony have called into question the appropriateness of allowing Tier 3 level development in certain MUB districts. The MUB land use 29 designation is primarily located along Wilshire Boulevard and along Lincoln Boulevard. The MUB designation along Lincoln Boulevard is located within the Downtown Specific Plan (DSP) area where development is generally taller and of a higher intensity than the rest of the City; therefore, Tier 3 development in this area would still appear appropriate. Also, the area along Wilshire Boulevard, west of Lincoln Boulevard, would also be governed by the DSP. However, for the remaining MUB designated area along Wilshire Boulevard, Tier 3 development may be out of scale with existing commercial development along Wilshire Boulevard. Moreover, Tier 3 development may be incompatible with existing adjacent multi - family residential development to the north and south of Wilshire Boulevard. Removing the option for Tier 3 development in this area could ensure appropriately scaled development that is compatible and consistent with existing adjacent residential neighborhoods, thereby preserving the scale, character, and quality of life in these neighborhoods. Furthermore, the LUCE Tier 3 maximum height and FAR standards of 55 feet and 2.75 FAR represent a notable increase when compared to existing C6 zoning along Wilshire Boulevard (ranging between .8 -2.0 FAR 130 -45 feet in height, depending on parcel size and project type); the Bergamot Area Plan (ranging between 1.0 -2.5 FAR /32 -86 feet in height, depending on parcel size and project variation); and the proposed Wilshire Transition standards of the Draft Downtown Specific Plan (ranging between 1.5 -2.25 FAR /39 -50 feet in height) (Attachment N). Tier 2 standards of 2.25 FAR/ 50 feet in height would provide adequate development opportunities for mixed -use housing projects with ground floor neighborhood serving uses along the boulevards consistent with the LUCE vision. The development of housing in the Downtown and Bergamot areas would also continue to occur. Even if Council were to decide to eliminate Tier 3 in the areas proposed, Council could consider retaining Tier 3 standards for 100% affordable housing projects. On March 18, 2015, the Planning Commission voted not to recommend this LUCE amendment. In its discussion, the majority of the Commission supported the LUCE vision to encourage housing in this manner along the boulevards as well as mixed use 30 centers within walking distance of neighborhoods. However, this decision has been appealed by Northeast Neighbors and Planning Commissioner Kennedy and therefore this LUCE amendment is before Council for its consideration. Since Tier 3 development is almost exclusively established through a development agreement which must be consistent with the General Plan, the Draft Zoning Ordinance does not set forth standards for Tier 3 development. Staff continues to support the amendments to Tier 3, however, Council may want to consider retaining Tier 3 standards for 100% Affordable Housing projects and Tier 3 height standards for City- Designated Landmarks and Structures of Merit. ® Amendment removing Tier 3 from the Mixed -Use Boulevard Low (MUBL) land use designation with the exception of the following MUBL areas: ® Broadway • Colorado Avenue ® Within any remaining Activity Center boundaries For the same reasons supporting the potential removal of Tier 3 from certain MUB designated areas, this amendment would remove Tier 3 from certain MUBL designated areas to ensure appropriately scaled development that is compatible with the character and quality of life of the adjacent residential neighborhoods. The MUBL areas listed above would not be subject to the removal of Tier 3 as the commercial corridors along Broadway and Colorado Avenue are located close to the Expo line and adjacent to existing Medium Density Housing and Industrial Conservation areas that transition more appropriately away from the commercial corridors than lower density residential areas. The remaining Activity Centers containing MUBL designations would also retain Tier 3 possibilities as the Activity Centers are envisioned to accommodate larger scaled development. Even if Tier 3 were to be removed in the areas proposed, it could be retained for 100% affordable housing projects. On March 18, 2015, the Planning Commission voted not to recommend this LUCE amendment. In its discussion, the majority of the Commission supported the LUCE 31 vision to encourage housing in this manner along the boulevards as well as mixed use centers within walking distance of neighborhoods. However, this decision has been appealed by Northeast Neighbors and Planning Commissioner Kennedy therefore this LUCE amendment is before Council for its consideration. Since Tier 3 development with limited exception is established through a development agreement which must be consistent with the General Plan, the Draft Zoning Ordinance does not set forth standards for Tier 3 development. Staff continues to support the amendments to Tier 3, however, Council may want to consider retaining Tier 3 standards for 100% Affordable Housing projects and Tier 3 height standards for City- designated Landmarks and Structures of Merit. ® Amendment to the text on LUCE page 2.1 -41 (first bullet on the left) to include the following: "and a 3 -foot height bonus above the 32 -foot base height ". This amendment would add an incentive for affordable housing projects in the Neighborhood Commercial designation that was not included in the original text. In all of the other commercial land use designations, a height bonus is granted above the Tier 1 base height allowing for an additional floor of housing for projects building the required affordable housing units in accordance with percentage requirements specified in the City's Affordable Housing Production Program for the project as a whole. In this case, the proposed amendment would only provide this height bonus to 100% affordable housing projects. Staff notes that in the Neighborhood Commercial designation along Main Street, this would allow for an increase in height of eight feet above the proposed base height of 27 feet to accommodate an additional floor of housing. On March 18, 2015, the Planning Commission voted not to recommend this LUCE amendment. However, this decision has been appealed by Planning Commissioners Parry and Ries and therefore this LUCE amendment is before Council for its consideration. The Draft Zoning Ordinance assumed that this amendment would be adopted and consequently it would need to be revised should the City Council decide not to authorize it. r«a Staff continues to support the amendment. ® Amendment eliminating the requirement that Tier 2 Residential Projects and Mixed - Use Projects with Residential Only above the first floor be processed by development agreement unless the projects provide nonresidential uses above the first floor. The tier system for new development in the LUCE requires that Tier 2 projects be subject to a discretionary review process. A Development Agreement is required for Tier 2 residential projects in residential land use districts, and in specified circumstances, for Tier 2 residential and mixed -use projects in commercial land use districts. This formulation of the LUCE was established in recognition of the restrictions imposed by Government Code Section 65589.50) and is intended to protect local land use control by ensuring that the reviewing bodies retain discretionary control over a project to the maximum extent desired. However, the proposed development standards and community benefits provisions in the Zoning Ordinance Update may establish adequate parameters for the review of new housing and mixed -use projects such that reliance on the development agreement process in all instances would not be necessary. The Planning Commission recommended this LUCE amendment on March 4, 2015 ® Amendment to eliminate the provisions stating that Tier 2 discretionary review be undertaken by a Conditional Use Permit and clarify that this discretionary review can be undertaken by a development review permit or its equivalent. (pp. 3.2 -4, 3.2 -5, 3.2 -6). Since the Tier system of the LUCE establishes development standards for buildings at certain heights and floor area ratios, and does not govern land uses, a Development Review Permit ( "DRP ") is the appropriate discretionary process and application type for the Tier 2 development review. Specifically, the purpose and findings for a DRP are more appropriate and are geared towards review of new construction, building form, and siting and design. The purpose of a Conditional Use Permit is to consider the impact of uses that may have an effect on the general welfare or safety of the public. 33 The Tier system represents the fundamental processes by which new development is reviewed in Santa Monica. While it is true that a CUP is a discretionary process, the same is true for a DRP. In fact, both a CUP and DRP are processed in a similar manner, reviewed and decided by the Planning Commission and, if appealed, by the City Council. However, the Draft Zoning Ordinance establishes an Architectural Review Board concept review as the initial public process for Development Review Permits. Therefore, since there are minimal differences between the two applications in terms of review authority and the appeal procedure, and public process is more extensive with a DRP, the critical components are the findings under which the application is evaluated, forming the basis for the determination. Since the findings for a DRP specifically address the physical attributes of a development, such as the size, massing, location, and placement of buildings to ensure the structure relates to the surrounding area and adjacent buildings, the DRP is best suited to evaluate new construction. The Planning Commission recommended this LUCE amendment on March 4, 2015. ® Amendment to establish that a project, which preserves a City- designated landmark or structure of merit in a portion of the R2 District that had historically been zoned R3, shall receive a 6 -foot height bonus, allowing for an additional floor of housing. ® Amendment to establish that when a project would preserve a City- designated landmark or structure of merit, the project may be reviewed by a discretionary review process other than development agreement so long as the project does not exceed the FAR for Tier 2 projects. Since the LUCE identifies historic preservation as a Community Benefit priority, the Draft Zoning Ordinance contains incentives to promote appropriate additions to and adaptive reuse of historic buildings. During the Zoning Ordinance Update process, the public articulated the need for an incentive of additional new development height, on sites where a historic resource would be retained. Specifically, certain portions (4th Court to the west, 14th Court to the east, Wilshire Boulevard to the south, and Montana Avenue to the north) of the City's R2 District were identified as an area where City- designated landmarks and structures of merit could benefit from further preservation incentives. Since these areas were historically zoned 34 R3, the historical development pattern of this area is different, with taller and more dense development. Since the LUCE authorizes a base maximum height not to exceed 30 feet in the R2 District, and does not establish the possibility of a higher tier, a potential LUCE amendment was proposed to authorize a 6 foot height bonus. This height bonus would allow an additional floor of housing beyond that otherwise authorized in this district. The amendment would have the effect of encouraging the retention of City- designated landmarks and structures of merit in this area by supporting additions to and adaptive reuse of these resources. Discretion regarding the massing of the project relative to the surrounding neighborhood and compatibility of the addition relative to the landmark or structure of merit would continue to be retained by the Zoning Administrator, or the Planning Commission on appeal, and the Landmarks Commission. This is an appropriate LUCE amendment consistent with the LUCE goal of historic preservation. The Planning Commission also recommended a LUCE amendment to allow for added height for properties in certain commercial areas, when a designated City landmark or structure of merit is being preserved. Specifically, as proposed the discretionary review process would be modified for a project that requests Tier 3 height. Since Tier 3 development is only authorized through approval of a development agreement, with limited exception, members of the public, especially the historic preservation community, believe that elimination of this requirement is necessary and appropriate to adequately incentivize certain projects that would preserve City- Designated Landmarks or Structures of Merit and that the requested FAR would not exceed the limitations established for Tier 2 projects. It has been suggested that establishing an alternative discretionary review process would be less complicated than a development agreement and would be a preservation incentive. However, the reviewing bodies would relinquish some discretion in exchange for this preservation incentive. The elimination of Tier 3 on the boulevards would limit the scope of this amendment unless, as suggested with 100% Affordable Housing, Council establishes an exception to authorize Tier 3 height for City- Designated Landmarks and Structures of Merit. 35 The Planning Commission recommended these LUCE amendments on March 18, 2015 Other Potential Amendments One of the potential amendments that the Planning Commission also included in the Resolution of Intention adopted on November 5, 2014 would have authorized market rate housing through a discretionary review process in the Industrial Conservation and Office Campus Districts. Currently the LUCE does not allow residential development in the Industrial Conservation District except for one hundred percent affordable housing in limited areas. It is unclear whether the LUCE authorizes any housing in the Office Campus District. This limited allowance for housing in the IC land use designation raised legal issues. More specifically, concerns were raised that only authorizing the provision of affordable housing may run afoul of Costa Hawkins, Civil Code Section 1954.50 et. seq., and to address this concern, market rate housing should also be permitted in these districts. However, upon further analysis, it was determined that allowing market rate housing in these employment districts could trigger the need for additional environmental analysis, which could not be undertaken in a timely fashion. Consequently, to address the potential Costa Hawkins issue the Planning Commission did not move forward with this potential LUCE amendment. Instead, the issue will revisited at a later time after further analysis and review. Consequently, the Draft Zoning Ordinance does not authorize one hundred percent affordable housing or market rate housing in these two districts. Draft LUCE Land Use Designation Map (Attachment I) A City -wide Land Use Designation Map was adopted as part of the adoption of the LUCE on July 6, 2010. During the public review process and in the course of analyzing the boundaries of the newly created zoning districts, inconsistencies between the adopted LUCE Land Use Designation Map and the existing Official Districting Map were identified. As a result, staff compared the LUCE Map with the existing Official Districting Map for all 23,500 parcels in the City, to generate a listing of inconsistent parcels. The Planning Commission reviewed these inconsistent parcels in detail on June 18, 2014 and October 1, 2014. 36 Exhibit A of Attachment K 3 is a table that lists the parcels in the City whose LUCE land use designations have been identified as being inconsistent with their existing zoning and uses as well as with adjacent parcels. The parcels are listed in the table with their address, existing zoning, existing LUCE designation, and the Planning Commission's recommendation as to what the appropriate LUCE designation should be for the parcels. This list contains 115 parcels. The majority of these inconsistent parcels, #1 -84 on Exhibit A of Attachment K 3, are parcels in the City whose land use designations were changed to a commercial designation with the adoption of the LUCE Land Use Designation Map and are now inconsistent with their predominantly residential zoning or partial residential zoning. As shown in Exhibit A of Attachment K 3, the recommendation is for these LUCE commercial land use designations to be changed back to LUCE residential land use designations to make them consistent with the existing residential zoning of these parcels. The remainder of these inconsistent parcels, #85 -115 on Exhibit A of Attachment K 3, includes parcels in the City whose LUCE land use designations are inconsistent with their existing commercial and industrial zoning and uses as well as with adjacent parcels. Of the 115 parcels, the Planning Commission recommended retaining the existing commercial land use designation of three parcels: ® 1127 2nd St ( #5 on Exhibit A of Attachment K 3) ® 11292 Id St ( #6 on Exhibit A of Attachment K 3) ® 11372 nd St ( #7 on Exhibit A of Attachment K 3) These parcels are currently zoned R3 (Medium Density Multiple Family Residential), with the southern end of 1137 2nd Street also zoned C3 (Downtown Commercial). The residential portions of these parcels also contain "A" overlay designations and are currently used for surface parking and a small office building. All three parcels, however, are currently designated Downtown Core under the existing LUCE land use designation M map, are commercially used, and are within the boundaries of the pending Downtown Specific Plan area. As the LUCE provides that the specific uses, height, FAR, and development standards for buildings and uses within the Downtown Core will be addressed by a Specific Plan, the Planning Commission voted not to recommend that these parcels be changed and would retain their LUCE commercial land use designation. Commissioner Kennedy appealed this action. A significant amount of public correspondence has been received regarding 1801 Wilshire Boulevard ( #90 on Exhibit A of Attachment K 3). Although the entire parcel is currently zoned C6 (Boulevard Commercial) and is currently occupied by multi -story commercial and office buildings with multi -level parking, the existing LUCE Land Use Designation Map identified the rear of the parcel as Low Density Housing. The Commission's recommendation is to change the rear portion of the parcel to a Mixed - Use Boulevard (MUB) LUCE land use designation to provide consistency with the existing MUB designation of the majority of the parcel, the existing zoning of the entire parcel, and the existing commercial, office, and parking uses on the parcel. No existing residential uses would be included in this LUCE land use designation correction at 1801 Wilshire Boulevard. A draft Official Districting Map (Attachment H) is attached that corresponds to the Draft LUCE Land Use Designation Map. Additional Issues In addition to the issues discussed above that were the subject of robust discussion and debate, several other issues were identified and resulted in revisions that resolved the concerns that were raised. Residential Uses on Commercial Parcels Adjacent to Residential Districts or Active Commercial- Section 9.29.200 This revision addresses situations where residential uses are located within commercial districts. Specifically, if a commercial parcel immediately adjacent to a residential district has only been residentially used since July 10, 2010, any redevelopment of a OR commercial parcel adjacent to this parcel, shall be designed in accordance with the development standards (minimum setbacks and daylight plane) as if the development were occurring next to a residential zoned parcel. Essentially, this provision protects residentially used parcels from having a zero setback when an adjacent commercially zoned parcel redevelops. It also extends to the adjoining parcel deeper into the commercial zoning if it is also residentially used. Live/Work and Home Occupation- Section 9.31.170 Section 9.31.170 establishes regulations and standards for creating and operating Live - Work units as a primary commercial /industrial use in which the occupant resides as a secondary land use activity. This is similar to standards for regulating artist studios in the existing Zoning Ordinance that treats artist studios principally as places of work while allowing living quarters. The proposed Live -Work standards in the Draft Zoning Ordinance generally continue the concepts currently in place for artist studios but broadens their applicability, requires that they be used for both work and residency, and establishes standards and regulations to allow additional commercial uses in Live -Work units. During the course of its review, the Commission expressed concern that while the proposed standards would appropriately allow for more types of uses within Live -Work units, particular attention should be paid to encouraging artists to occupy such units and also to how these units are utilized. The Draft Zoning Ordinance would include standards requiring that the Live -Work units be marketed specifically to artists initially and on an ongoing basis. New design guidelines have also been added to require design elements including, but not limited to, floor drains, appropriate flooring and finishes, and proper ventilation within these units that will help accommodate the range of activities associated with Live -Work units. In response to concerns about the number of persons who would be allowed to work in the unit while not residing there, the Draft Zoning Ordinance has been revised to reduce this allowance to three persons. 39 Demolition Standards- Chapter 9.25 The Draft Zoning Ordinance would refine what is considered a demolition. The provisions identifying demolitions typically have related to exterior wall elements including, but not limited to, the subsurface or non - decorative cladding necessary for structural support, columns, studs, cripple walls, or similar vertical load- bearing elements and associated footing, windows, or doors. In the context of potentially historic structures, these standards have been problematic since exterior cladding can be an integral feature of these potential resources. Consequently, the Draft Zoning Ordinance would add new provisions establishing heightened review before a building or structure over forty years of age and identified on the City's Historic Resources Inventory can be demolished. Specifically, in assessing whether a demolition has occurred, the removal of walls now includes the removal of exterior cladding. In addition, a property owner and contractor would be required to sign an affidavit acknowledging that they are aware of the City's definition of a demolition and the penalties associated with an unlawful demolition, and a developer would be required to submit written verification from a structural engineer certifying that the exterior walls shown to remain are structurally sound and will not have to be removed. Historic Resources - 9.01.050 In order to preserve and protect historic resources and /or properties on the Historic Resources Inventory in the City through the City's land use decision - making process, the Draft Zoning Ordinance would authorize flexible zoning standards and modifications to development standards for these resources. This Draft Zoning Ordinance would also establish heightened review before a building or structure over 40 years of age can be demolished and impose a more stringent definition of "demolition" for buildings or structures on the City's Historic Resources Inventory. Listed below are the provisions throughout the Draft Zoning Ordinance focused specifically on historic resources: 1. Section 9.07.020 Bed and Breakfast within Designated Landmarks in R1 Only 2. Section 9.25.030 Demolition Defined 3. Section 9.25.040 Requirements for Approval of Demolition Permit 40 4. Section 9.27.030(C) 5. Section 9.27.030(F)(1) 6. Section 9.27.040(A) 7. Section 9.28.180(A) 8. Chapter 9.33 9. Section 9.42.040 Replacing Nonconforming Features or Portions of Buildings Demolition and Rebuilding Damaged Structure Restoration Application Reduction of Required Parking Historic Resource Disclosure Required Findings for Variances 10. Chapter 9.43 Modification and Waivers 11. Section 9.48.050 Unauthorized Demolition of Historic Resources 12. Section 9.52.020 13. Section 9.52.020 14. Section 9.52.020 15. Section 9.52.020 16. Section 9.52.020 17. Section 9.52.020 18. Section 9.52.020 19. Section 9.52.020 Definition of Attic Definition of City- Designated Contributing Building or Structure Definition of City- Designated Historic Resource Definition of City- Designated Landmark Definition of City- Designated Structure of Merit Definition of Historic Resource Definition of Historic Resources Inventory Definition of State Historical Building Code Request for Review of Residential Development Standards Throughout the Draft Zoning Ordinance Update process, the Planning Commission and city staff received input from various neighborhood representatives seeking specific zoning standards reflecting the uniqueness of their respective neighborhoods. Specifically, North of Wilshire Neighborhood, the Sunset Park Neighborhood, the Ocean Park Neighborhood, the Pico Neighborhood, and the South Beach Tract Neighborhood, have all requested new zoning standards. The issues that have prompted requests for specific standards have included lot sizes, hillside slopes, housing types, social and economic revitalization, and proximity to mass transit. If specific standards were to be established on a neighborhood -by- neighborhood basis, as with the Ocean Park Neighborhood standards developed in 1989 and the North of Montana Neighborhood standards developed in 1999, then staff recommends using similar focused planning processes to engage the neighborhoods rather than establishing limited specific 41 regulations through the Draft Zoning Ordinance process. Similar processes could be established for other neighborhoods should the Council believe that to be appropriate. As previously stated, the Planning Commission specifically recommended that staff request Council direct staff to establish a planning process to examine the Pico Neighborhood zoning standards in its work plan. Community Outreach A total of 33 public hearings have been conducted to review and discuss the Draft Zoning Ordinance. Planning Commission public hearings commenced on December 11, 2013 and continued through October 2014, with 20 Planning Commission hearings on the Initial Public Review Draft and related documents. On October 22, 2014, the Redline was released. A Planning Commission town hall meeting was held on November 19, 2014 to allow the public to provide its initial input and comments on the Redline. Formal Planning Commission hearings to review the Redline began on December 3, 2014 and the final hearing was conducted on March 18, 2015, totaling 12 additional hearings. Each hearing was publicly noticed in the Santa Monica Daily Press and each Planning Commission agenda and staff report was available through the City's website, at the public hearing, and at the City Planning Division. Environmental Analysis On July 6, 2010, Council certified the LUCE Program EIR (State Clearinghouse Number #2009041117), adopted CEQA findings and a statement of overriding considerations, and adopted the LUCE. The LUCE Program EIR analyzed the environmental impacts of future changes that would reasonably occur with implementation of the LUCE. In accordance with CEQA and the CEQA Guidelines, preparation of a Negative Declaration may occur if the City, as lead agency, finds that there is no evidence that the Project would not have a significant effect on the environment. Such determination can be made only if "there is no substantial evidence, in light of the whole record before the lead agency, that such an effect may occur (Section 21080 (c), Public Resources Code). 42 Section 15152 of the CEQA Guidelines allows an EIR or ND to tier from the environmental analysis of an earlier EIR or ND as follows: "Tiering refers to using the analysis of general matters contained in a broader EIR with later EIRs and negative declarations on narrower projects; incorporating by reference the general discussions from the broader EIR; and concentrating the later EIR or negative declaration solely on the issues specific to the later project.... Tiering is appropriate when the sequence of analysis is from an EIR prepared for a general plan, policy or program to an EIR or negative declaration for another plan, policy, or program of lesser scope, or to a site - specific EIR or negative declaration." Additionally, Section 15168(c)of the State CEQA Guidelines, a program EIR can be used in compliance with CEQA to address the effects of a subsequent activity so long as the activity is within the scope of the project covered by the program EIR and no new effects are found and no new mitigation measures would be required. Pursuant to CEQA, the City prepared an Initial Study /Negative Declaration (IS /ND) to evaluate the potential environmental effects of the proposed Zoning Ordinance Update (Attachment M). This IS /ND addresses all environmental issues listed in Appendix G of the CEQA Guidelines. Since the Zoning Ordinance Update is entirely consistent with the 2010 LUCE, the IS /ND tiers with and incorporates, by reference, the City's previously certified Program Environmental Impact Report [EIR] (June 2010) prepared for the Land Use and Circulation Element (LUCE) pursuant to CEQA Guidelines Sections 15150 (Incorporation by Reference), 15152, and 15168. The Draft Zoning Ordinance would make revisions, additions, corrections and clarifications to various sections of the Zoning Ordinance to ensure consistency with and successful implementation of the LUCE. The proposed Zoning Ordinance Update sets forth land use regulations for Tier 1 and Tier 2 projects only and would not permit land uses of greater density or height than permitted under the LUCE and would not allow new development in areas where such development is prohibited under the LUCE. Further, the City has adopted the Bergamot Area Plan and is in the process of 43 preparing a Downtown Specific Plan and Memorial Park Neighborhood Plan, each of which would require separate environmental review. Future land uses allowed pursuant to the Draft Zoning Ordinance would be subject to permitting and project specific use, development and design conditions as governed by the Zoning Ordinance, as updated. Additionally, future land uses would be subject to review on a project -by- project basis to determine compliance with CEQA. If necessary, project -level CEQA review will be required to determine project- specific impacts. Evaluation of future project -level impacts would be too speculative to include in the IS /ND (see CEQA Guidelines Section 15145). Based on the analysis provided within the Initial Study /Negative Declaration, the City has concluded that adoption of the Draft Zoning Ordinance would not result in new significant impacts on the environment that have not been previously examined or adequately addressed in the LUCE Program EIR. Additionally no new mitigation measures would be required; mitigation measures that were adopted for the LUCE Program EIR continue to remain applicable. The draft Initial Study/ Negative Declaration (IS /ND) for the Zoning Ordinance Update was circulated for review and comment by the public, agencies, and organizations for a 30 -day public review period that began on December 20, 2013, and concluded on January 20, 2014 in accordance with CEQA Guidelines Section 15073. The Notice of Intent (NOI) to adopt the ND was posted with the Los Angeles County Clerk and the State Clearinghouse, made available on the City's Planning and Community Department website, distributed to all relevant public agencies, and mailed to all City neighborhood groups. Three comment letters were received from California Department of Fish and Game, Native American Heritage Commission, and Southern California Edison. Responses to comments have been provided to each comment letter received. As has been discussed, commencing in December 2013 and continuing through October 2014, multiple Planning Commission hearings occurred on the draft Zoning Ordinance Update and related documents, during which time the Planning Commission preliminarily reviewed all provisions of this Update. Based on the Planning 011 Commission's discussion, public comments, and continued staff analysis, redline edits were made to the Initial Public Review Draft and on October 22, 2014, the Redline was released. Since that time, further Planning Commission review has occurred, resulting in additional ( "Greenline ") edits to the Redline and review of potential amendments to the City of Santa Monica's Land Use Circulation Element. The proposed negative declaration examines each of these proposed amendments and determines that no new physical impacts that were not already analyzed in the LUCE EIR would occur as a result of these amendments. These revisions and review have resulted in the addition of new information to the negative declaration which merely clarifies, amplifies, or makes modifications to the negative declaration and were not to such extent that the substance of the analysis in the IS /ND needed to be reconsidered. Pursuant to Section 15073.5 of the CEQA Guidelines, recirculation of the IS /ND is not necessary. Next Steps With the Council's direction, staff will revise and return with the following on May 5, 2015: ® Introduction and First Reading of an ordinance adopting the Zoning Ordinance and related land use and zoning related provisions ® A Resolution to adopt the Official Districting Map ® A Resolution to amend the LUCE Land Use Designation Map, after consideration of the appeals ® A Resolution to amend the LUCE, after consideration of the appeals ® A Resolution to adopt the Negative Declaration 45 Financial Impacts & Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Prepared by: Amanda Schachter, Planning Manager Barry A. Rosenbaum, Senior Land Use Attorney Bradley J. Misner, AICP, Principal Planner Tony Kim, Acting Special Projects Manager Approved: AV Director, Planning & Community Development Attachments Forwarded to Council: �\f- P Elaine Pola hek Interim City Manager A. Draft Zoning Ordinance B. 'Redline" Draft Zoning Ordinance C. "Greenline" Changes to Redline Public Review Draft D. Division 6, Land Use and Zoning Related Provisions E. Public Correspondence Document F. Cross - reference Chart G. Public Correspondence since December 3, 2014 (Volume 1 and 2) H. Draft Official Districting Map I. Draft LUCE Land Use Designation Map J. Planning Commission Minutes K. Planning Commission Resolutions 1. Resolution 15 -003 (PCS) 2. Resolution 15 -004 (PCS) 3. Resolution 15 -007 (PCS) 4. Resolution 15 -008 (PCS) 5. Resolution 15 -009 (PCS) 6. Resolution 14 -004 (PCS) 7. Resolution 14 -005 (PCS) L. Tier 1 and Tier 2 Comparison Chart M. Negative Declaration N. Development Standards Comparison Charts EM Reference: All Attachments A —N Are filed with Staff Report 04/14/2015, Item 4 -A Within Legislative file 400 -004