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O2670DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 1 City Council Meeting: March 9, 2021 Santa Monica, California ORDINANCE NUMBER 2670 (CCS) (City Council Series) AN EMERGENCY INTERIM ZONING ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA TO TEMPORARILY PROHIBIT NON- RESIDENTIAL USES CITYWIDE AND SINGLE-UNIT DWELLINGS IN COMMERCIAL ZONES TO PRESERVE POTENTIAL HOUSING SITES IN PREPARATION OF THE 6TH CYCLE HOUSING ELEMENT WHEREAS, the State is experiencing a housing supply crisis, with housing demand far outstripping supply; and WHEREAS, in 2018, California ranked 49th out of the 50 states in housing units per capita; and WHEREAS, the housing crisis has particularly exacerbated the need for affordable homes at prices below market rates; and WHEREAS, the housing crisis has resulted in increased poverty and homelessness, especially first-time homelessness, forced lower income residents into crowded and unsafe housing in urban areas, and forced families into lower cost new housing in greenfields at the urban-rural interface with longer commute times and a higher exposure to fire hazard; and WHEREAS, California needs an estimated 180,000 additional homes annually to keep up with population growth, and the Governor has called for 3.5 million new homes to be built over 7 years; and DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 2 WHEREAS, the City is in the process of updating the Housing Element to its General Plan for the 6th Cycle, covering the period from 2021 to 2029; and WHEREAS, the City has received a Regional Housing Needs Assessment (“RHNA”) allocation for the 6th Cycle Housing Element of approximately 8,895 housing units, with approximately 70 percent allocated as affordable housing; and WHEREAS, this RHNA allocation will require the City to permit approximately 1,000 housing units annually between 2021 and 2029, 700 of which are required to be affordable housing, representing an increase of approximately five times over the City’s RHNA allocation for the 5th Cycle Housing Element (2013-2021); and WHEREAS, on July 6, 2010, the City Council adopted the Land Use and Circulation Element of the City’s General Plan (“LUCE”) which designates the proposed general distribution, location, and extent of land uses within the City; and WHEREAS, the LUCE was adopted after an extensive planning process and addresses neighborhood conservation and enhancement; integrated land use and transportation; proactive congestion management; complete neighborhoods with increased open space; community benefits; quality urban character and form; preservation of historic resources; and growth management; and WHEREAS, the LUCE sets forth a strategy that focuses new housing development in areas with the greatest access to high frequency transportation systems – the commercial boulevards and the areas surrounding the Expo Light Rail stations – Downtown, Bergamot, and Memorial Park; and DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 3 WHEREAS, the LUCE strategy for housing development was implemented through the City’s new Zoning Ordinance, Chapters 9.01 through 9.52 of Article 9 of the Santa Monica Municipal Code (“Zoning Ordinance”), which became effective on July 24, 2015, and the Downtown Community Plan (“DCP”), which was adopted on July 25, 2017; and WHEREAS, the LUCE also established the Industrial Conservation (“IC”) land use designation, which was intended to conserve small light industrial and service/commercial uses that have traditionally populated the IC District and formed part of Santa Monica’s employment base and to support existing and new creative businesses reliant on the affordable workspace created from adaptive reuse of former industrial buildings; and WHEREAS, the Zoning Ordinance, consistent with the LUCE’s vision for the IC land use designation, prohibits housing in the IC District, in part out of concern that introducing residential uses could have the potential to increase real estate speculation, thereby displacing the creative industries and small-scale industrial uses supported by affordable workspace; and WHEREAS, the LUCE’s strategy for housing development, along with the exclusion of housing in the IC District, results in approximately 12 percent of the City’s total land area being available for residential growth, all of which is zoned to allow both commercial and residential uses; and WHEREAS, the City has recently developed a preliminary Suitable Sites Inventory (“SSI”) analysis as part of the 6th Cycle Housing Element update that prioritizes parcels for their likelihood to produce housing; and DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 4 WHEREAS, the preliminary SSI analysis has resulted in an even smaller subset of parcels, representing approximately three percent of the city’s total land area, being identified as potentially having the highest housing potential; and WHEREAS, in the past five years, the City has approved 11 projects consisting of approximately 184,000 square feet of non-residential uses; and WHEREAS, in addition, the City has received applications for non- residential development on possible housing sites, predominantly consisting of 319,000 square feet of total office space, but also including a hotel use and electric vehicle charging facility on two surface parking lots; and WHEREAS, these recent development trends favoring commercial development over residential in areas targeted by the LUCE for residential growth are supported by preliminary findings for a feasibility analysis conducted by for the City in 2019 which studied the likelihood that an applicant would choose to pursue a housing development based on the City’s existing development standards and inclusionary housing requirements and demonstrated that housing projects were less likely than commercial projects to proceed; and WHEREAS, the City currently permits single-unit dwellings in commercial areas, even on parcels that could support more housing development potential; and WHEREAS, the BC (Promenade) and BC (2nd & 4th Streets) Districts, which include the areas surrounding the Third Street Promenade Area, are considered the pedestrian and economic heart of the City due to their vibrant urban DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 5 atmosphere supported by a broad mix of building types, office space, entertainment, retail, restaurants, cafes, salons and exercise studios; and WHEREAS, the area within the IC District and 500 feet of the I-10 freeway has not historically seen development, and may not be suitable for housing due to its proximity to the freeway and because it may require extensive environmental remediation, which raises environmental and social justice concerns; and WHEREAS, schools are an essential component of a balanced community, and must be allowed to establish and expand during times of residential growth; and WHEREAS, the economic impacts of the COVID-19 closures of and limitations on businesses have been devastating to the local Santa Monica economy; and WHEREAS, on May 12, 2020, the City Council adopted Emergency Interim Zoning Ordinance Number 2637 (CCS) (“Interim Zoning Ordinance 2637”), which established interim zoning regulations to provide immediate relief and regulatory certainty for businesses Citywide that may have interest in looking ahead to make plans for re-opening by taking initial steps towards economic recovery that included: modifying alcohol exemption conditions in order to streamline process for alcohol service and provide flexibility in operations for eating establishments; relaxing standards related to legal, nonconforming retail and restaurant uses; relaxing requirements to provide additional parking and new loading spaces for changes of use in existing tenant spaces; eliminating the requirement for Conditional Use Permits for restaurants only due to size; and removing the DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 6 inflexibility caused by a cap of no more than 5 persons allowed for small yoga studios and gyms; and WHEREAS, on May 12, 2020, the City Council adopted Emergency Interim Zoning Ordinance Number 2636 (CCS) (“Interim Zoning Ordinance 2636”), establishing interim zoning regulations for the economic recovery of those portions of the BC (Promenade) District bounded by Second Street to the west, Broadway to the south, 4th Street to the east and Wilshire Boulevard to the north, including the Third Street Promenade (the “Third Street Promenade Area”) which established interim zoning regulations to provide immediate relief and regulatory certainty for businesses in the Third Street Promenade area that may have interest in looking ahead to make plans for re-opening by taking initial steps towards economic recovery that included: minor modifications to land use regulations to provide additional business opportunities and increased flexibility for existing businesses; eliminating the requirement of a Conditional Use Permit for the conversion of eating and drinking establishments to other uses; easing standards related to legal, nonconforming restaurant and retail uses; relaxing Alcohol Exemption conditions and processes; and allowing for alternate compliance with loading standards; and WHEREAS, on November 10, 2020, the City Council adopted Emergency Interim Zoning Ordinance Numbers 2657 (CCS) and 2658 (CCS) to extend the emergency interim zoning regulations adopted by Emergency Interim Zoning Ordinance Numbers 2636 and 2637 and make other minor changes to further encourage economic recovery; and DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 7 WHEREAS, allowing additions to and changes of uses in existing structures will support continued maintenance and investment in existing commercial buildings that are unlikely to be housing sites while also ensuring that the flexibility in changes of use afforded by Interim Zoning Ordinance Numbers 2657 and 2658 remains to support tenanting of vacancies throughout the City; and WHEREAS, the City Council finds and declares that a current and immediate threat to the public health, safety, and welfare exists due to the State’s ongoing and unprecedented housing crisis, which has resulted in the City’s very large RHNA allocation of 8,895 units, and with only three percent of the City’s total land area available as the highest potential for housing, the approval of additional subdivisions, use permits, variances, building permits, or any other applicable entitlement on even one of the sites with housing potential would result in that threat to public health, safety, or welfare because the loss of a suitable site to non- residential development or underproduction of housing units would jeopardize the City’s ability to have sufficient sites for the SSI, adopt a Housing Element compliant with State law requirements, and plan for the production of 8,895 units over the next eight years. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Effect on Previously Approved Projects and Projects in Process. The following projects that would otherwise be affected by the temporary prohibitions set forth in this Interim Zoning Ordinance shall not be subject to this Interim Zoning Ordinance: DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 8 (a) Previously Approved Development. The erection, construction, enlargement, demolition, moving, conversion of, and excavation and grading for any building or structure, or establishment of use, for which a valid planning entitlement or permit or building permit, including plan check, was issued prior to January 12, 2021 and which does not subsequently expire. A permit or entitlement that does not contain an express limit on the time for exercising the permit shall be deemed valid only if a building permit, including plan check, is obtained by January 12, 2021. (b) Applications for Projects in Progress. For projects that do not require a planning entitlement, any application for a building permit, including plan check, determined complete on or before January 12, 2021. (c) Automobile Dealerships. Parcels located on Santa Monica Boulevard between Lincoln and 20th Street that are currently in use as automobile dealerships or for services ancillary to automobile dealerships. (d) Development Agreements. Parcels subject to pending development agreements. SECTION 2. Temporary Prohibition on Non-residential Uses. (a) Temporary prohibition. Notwithstanding anything to the contrary in the land use regulations set forth in Santa Monica Municipal Code Sections 9.07.020, 9.08.020, 9.09.080, 9.10.040, 9.11.020, 9.13.020, 9.14.020, or 9.15.020, and subject to the exceptions set forth in paragraph (b), Non-Residential Use Classifications, as listed in 9.51.030, are prohibited in all Districts in the City. DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 9 (b) Exceptions. The temporary prohibition set forth in paragraph (a) shall not apply to the following: (1) Parcels located within: (A) The BC (Promenade) District; (B) The BC (2nd & 4th Streets) District; and (C) The Industrial Conservation District that have boundaries located entirely within 500 feet of the I-10 Freeway, as more fully depicted in Exhibit A, attached hereto, and incorporated herein by reference. (2) Schools, as defined by Santa Monica Municipal Code Section 9.51.030(A)(11), including expansions and additions to schools and facilities operated by schools. (3) Projects consisting of: (A) A Change of use in an existing structure. (B) An attached addition to an existing structure, or a free- standing addition on a parcel with an existing structure, that is no larger than the floor area of the existing structure. SECTION 3. Temporary Prohibition on Single-Unit Dwellings in Nonresidential Districts. Notwithstanding anything to the contrary in the land use regulations set forth in Santa Monica Municipal Code Sections 9.10.040, 9.11.020, 9.13.020, 9.14.020, or 9.15.020, single-unit dwellings, as defined by Santa Monica Municipal Code Section 9.51.020(A)(1)(a), are prohibited in all Nonresidential Districts in the City. DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 10 SECTION 4. Any provision of the Santa Monica Municipal Code or any appendix thereto inconsistent with the provisions of this Emergency Interim Zoning Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Emergency Interim Zoning Ordinance. SECTION 5. If any section, subsection, sentence, clause, or phrase of this Emergency Interim Zoning Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Emergency Interim Zoning Ordinance. The City Council hereby declares that it would have passed this Emergency Interim Zoning Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 6. The Mayor shall sign and the City Clerk shall attest to the passage of this Emergency Interim Zoning Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Emergency Interim Zoning Ordinance shall become effective immediately upon adoption. /// /// DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 11 SECTION 7. This Emergency Interim Zoning Ordinance shall be of no further force or effect after April 23, 2021 unless it is otherwise extended pursuant to California Government Code Section 65858. APPROVED AS TO FORM: GEORGE S. CARDONA Interim City Attorney DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C 12 Exhibit A Parcels within Industrial Conservation District that Have Boundaries Located Entirely within 500 Feet of the I-10 Freeway [Behind this page] DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C DocuSign Envelope ID: ED93ECBC-AB3F-4801-B740-B3212D65F53C Approved and adopted this 9th day of March, 2021. Sue Himmelrich, Mayor State of California ) County of Los Angeles ) ss. City of Santa Monica ) I, Denise Anderson-Warren, City Clerk of the City of Santa Monica, do hereby certify that the foregoing Ordinance No. 2670 (CCS) had its introduction and adoption at the Santa Monica City Council meeting held on March 9, 2021, by the following vote: AYES: Councilmembers Brock, Davis, De la Torre, McKeown, Parra, Mayor Pro Tem McCowan, Mayor Himmelrich NOES: None ABSENT: None ATTEST: 3/16/2021 Denise Anderson-Warren, City Clerk Date A summary of Ordinance No. 2670 (CCS) was duly published pursuant to California Government Code Section 40806.