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R11371DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 1 Planning Commission Meeting: October 12, 2021 Santa Monica, California RESOLUTION NUMBER 11371 (CCS) (City Council Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA ADOPTING THE 6TH CYCLE (2021-2029) HOUSING ELEMENT OF THE CITY’S GENERAL PLAN WHEREAS, State Housing Element Law, California Government Code Sections 65580 et seq., requires the City to review and update the Housing Element of its General Plan every eight years; and WHEREAS, as the City prepares its 6th Cycle (2021-2029) Housing Element (the “6th Cycle Housing Element”), 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 DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 2 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 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 (2013-2021) Housing Element; and WHEREAS, in September 2020, the City commenced a public outreach process for the 6th Cycle Housing Element, which has consisted of creation of a dedicated website, presenting informational webinars, seeking input through questionnaires and surveys, forming two technical working groups, and conducting a series of study sessions with the Planning Commission, Housing Commission, Rent Control Board, and the City Council; and WHEREAS, on or about May 24, 2021, City staff published a draft 6th Cycle Housing Element (“Draft Housing Element”) built around four primary principles: 1) housing production—providing access to increase housing production, with an emphasis on affordable housing; 2) housing stability—ensuring that existing residents are protected from displacement; 3) location—incentivizing and locating housing close to daily services DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 3 and amenities like parks and schools in addition to places around the city that have historically not accommodated housing; and 4) equitable housing access—overcoming historic patterns of segregation by expanding access to housing choices in high opportunity areas; and WHEREAS, the Draft Housing Element includes a variety of goals and policies based on these four principles related to new housing production for all income categories, the preservation of existing housing, ensuring equitable housing access to all neighborhoods, providing housing for the homeless and housing assistance and supportive services to low-income households, and eliminating housing discrimination; and WHEREAS, the Draft Housing Element sets forth a range of programs to implement such goals and policies, including, but not limited to, procedural changes to streamline the review of housing projects, updates to development standards and the City’s Affordable Housing Production Program (“AHPP”) to ensure housing projects are feasible as the City achieves is affordable housing production goals, providing opportunities for housing in areas of the City that do not currently permit housing, incentivizing housing in areas of the City that have not historically supported housing production, amending the City’s density bonus ordinance to ensure consistency with State law and integration into the City’s land use system, and committing to the production of affordable housing on City-owned/publicly owned land; and WHEREAS, on June 2 and 3, 2021, the Planning Commission conducted a public hearing on the Draft Housing Element and made recommendations to the City Council; and DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 4 WHEREAS, on June 15, 2021, the City Council conducted a public hearing to discuss the Draft Housing Element and directed staff to transmit the Draft Housing Element to the California Department of Housing and Community Development (“HCD”) with revisions; and WHEREAS, on July 1, 2021, City staff transmitted the Draft Housing Element, as revised by the City Council, to HCD for a 60-day review period; and WHEREAS on August 4, 2021, in accordance with Santa Monica Municipal Code Section 9.45.060(A), the Planning Commission adopted a Resolution of Intention, Resolution Number 21-006 (PCS), declaring its intention to consider recommending to the City Council that the City Council adopt the 6th Cycle (2021-2029) Housing Element of the City’s General Plan and amendments to the Land Use and Circulation of the City’s General Plan, the Bergamot Area Plan and the Downtown Specific Plan for consistency with the goals, policies and programs set forth in the Housing Element; and WHEREAS, on August 30, 2021, in accordance with Government Code Section 65585, HCD issued a letter to report on its review of the Draft Housing Element; and WHEREAS, HCD’s review concluded that the draft Housing Element addressed many statutory requirements, but that revisions would be necessary to substantially comply with State Housing Element Law; and WHEREAS, in its review letter, HCD set forth recommended revisions to the Draft Housing Element to, among other things, provide additional information and analysis of the City’s: housing needs, resources, and constraints related to fair housing; population and employment trends; household characteristics; Suitable Sites Inventory (“SSI”); DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 5 zoning regulations for a variety of housing types; governmental and nongovernmental constraints on housing; special housing needs; and “at risk” housing units; and WHEREAS, HCD further recommended that the City make revisions to housing programs set forth in the Draft Housing Element to: demonstrate adequate capacity for the RHNA allocation; address, and where legally possible, remove, constraints to the maintenance, improvement and development of housing; promote and affirmatively further fair housing; and preserve assisted housing development for low-income households; and WHEREAS, on September 8, 2021, the Planning Commission held a discussion to consider HCD’s review and recommendations and to discuss concepts that would address those recommendations; and WHEREAS, on September 20, 2021, the Planning Commission conducted a discussion to review proposed revisions to the Draft Housing Element to address HCD’s recommendations; and WHEREAS, on September 24, 2021, Planning Commission conducted a duly noticed public hearing, and after considering oral and written testimony, adopted a Resolution of Recommendation, Resolution Number 21-011 (PCS), recommending to the City Council that the City Council adopt the 6th Cycle Housing Element; and WHEREAS, on October 12, 2021, the City Council conducted a duly noticed public hearing to consider HCD’s comments and the recommendation of the Planning Commission. DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 6 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS: SECTION 1. Pursuant to Santa Monica Municipal Code Section 9.45.080, after consideration of all oral and written testimony presented on October 12, 2021, including, but not limited to, public comments received by the City and compiled by City staff in accordance with Government Code Section 65585(b)(2), the City Council does hereby adopt the 6th Cycle (2021-2029) Housing Element as set forth in Exhibit A, attached to this Resolution and incorporated herein by reference. SECTION 3. Pursuant to Government Code Section 65585(e), the City Council has considered the findings and recommendations set forth HCD’s letter dated August 30, 2021, which determined, in part, that the Draft Housing Element required revision in order to substantially comply with Housing Element Law. In accordance with Government Code Section 65585(f)(1), the Draft Housing Element was revised to incorporate HCD’s recommendations for substantial compliance with Housing Element Law prior to adoption of the 6th Cycle Housing Element by the City Council. SECTION 4. Pursuant to Government Code Section 65583.2(g)(2), based on substantial evidence set forth in Chapter 4, Summary of Land Available for Housing, and Appendix F, Suitable Sites Inventory Report of the 6th Cycle Housing Element, the existing uses on nonvacant sites identified in the SSI to accommodate lower income housing are likely to be discontinued during the planning period, and therefore do not constitute an impediment to additional residential development during the period covered by the Housing Element. DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 7 A. Parcels with existing uses that were not likely to be discontinued during the planning period were not examined for suitability, as follows: • Parcels in the RMH (Residential Mobile Home) and OS (Open Space) Districts; • Parcels with existing historic resources; • Parcels that are under construction, or have recently completed projects, approved entitlements, or pending entitlements for commercial uses only; • Parcels that have unique land uses, such as Santa Monica City Hall, Los Angeles County Courthouse, Civic Auditorium, hospitals, cemetery, schools, parks, churches/religious facilities, utilities, government offices, libraries, police/fire stations, transportation infrastructure/Metro Expo Light Rail, and airport; • Parcels developed with affordable housing, condominium units, and rent control units; and • Parcels with newer buildings developed post 1980. B. All remaining parcels (approximately 1,300) were placed into categories and examined for suitability. Parcels with existing uses were selected for the SSI based on the following factors and evidence: 1. Category 1 (Approved/Pending Project Sites): Sites for which entitlements have been issued for housing development projects or applications have been received for housing development projects; evidence that in the previous planning period, only 10 percent of approved or pending projects are withdrawn and/or have had permits expire. DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 8 2. Category 2 (Prior 5th Cycle Housing Element Sites): Evidence that property owners have expressed past or current development interest; the properties are underdeveloped below current maximum floor area ratio (“FAR”) allowed, or have single tenants. Evidence that past and current proposed housing projects all occurred on similar nonvacant sites with existing uses consisting of older buildings (at least 40 years of age) or surface parking lots. Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and recent financial feasibility studies that concluded residential projects will be more likely to occur than commercial projects with increased development potential (i.e., greater permitted FAR and height) for housing development projects, as proposed by Program 1 J of the Housing Element. 3. Category 3 (Downtown Community Plan buildout): Evidence that the sites have low assessors value ratio (“AVR”) (less than 0.5), are developed with low-scale buildings more than 40 years of age, are developed below current maximum FAR allowed, are located in proximity to many other recent housing projects in the Downtown, and have been previously identified as high potential for redevelopment in the 2017 Downtown Community Plan. Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and that past and current proposed housing projects all occurred on similar nonvacant sites with existing uses consisting of older buildings (at least 40 years of age) or surface parking lots. DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 9 4. Category 4 (City-owned Sites): Evidence that these City-owned sites do not have long-term leases with outside parties that extend beyond the 6th Cycle Housing Element planning period and do not have existing uses that are non-City operated. 5. Category 5 (Parking Lot Sites): Evidence that these surface parking lots do not serve existing uses that have demonstrated longevity (e.g., uses that are more unique in a particular location such as a successful grocer in a residential neighborhood, a popular restaurant, long-standing reputable business, etc.) and that past and current proposed housing projects occurred on similar nonvacant sites with existing uses consisting of surface parking lots. Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and recent financial feasibility studies that concluded residential projects will be more likely to occur than commercial projects with increased development potential (i.e., greater permitted FAR and height) for housing development projects, as proposed by Program 1 J of the Housing Element. 6. Category 6 (Auto Inventory Sites): Evidence that property owners of such sites have expressed past or current development interest; there is common ownership with adjacent parcels, or there are other multiple parcels located elsewhere that are also owned by the same property owner. Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and recent financial feasibility studies that concluded residential projects will be more likely to occur DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 10 than commercial projects with increased development potential (i.e., greater permitted FAR and height) for housing development projects, as proposed by Program 1 J of the Housing Element. 7. Category 7 (Recently Sold/For Sale Sites): Evidence that the sites are for sale or recently sold, and existing buildings on the sites are vacant and have upcoming expiring lease terms. Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and recent financial feasibility studies that concluded residential projects will be more likely to occur than commercial projects with increased development potential (i.e., greater permitted FAR and height) for housing development projects, as proposed by Program 1 J of the Housing Element. 8. Categories 8, 9, and 10 (Underutilized Sites, Remaining Large Parcels, Remaining Sites with 0.5 AVR or Less): Evidence that the existing buildings on the sites are low-scale buildings and more than 40 years old, have single tenancy or minimal tenancy, there is known developer interest, or the existing use does not appear to have longevity (e.g.,uses that are more unique in a particular location such as a successful grocer in a residential neighborhood, a popular restaurant, long-standing reputable business, etc.). Evidence that in the past decade development in Santa Monica has trended towards new residential development rather than new commercial development, and recent financial feasibility studies that concluded residential projects will be more likely to occur than commercial projects with increased development potential (i.e., greater DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 11 permitted FAR and height) for housing development projects, as proposed by Program 1 J of the Housing Element. SECTION 3. The City Council hereby authorizes staff to make non-substantive changes to the Housing Element as necessary to make it internally consistent, in conformity with the final City Council action, and approved as to form by the City Attorney. Should HCD require substantive changes to the Housing Element adopted herein, staff shall bring such changes back to City Council for review and adoption. SECTION 4. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: JOSEPH LAWRENCE Interim City Attorney DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F 12 EXHIBIT A CITY OF SANTA MONICA 6TH CYCLE (2021-2029) HOUSING ELEMENT City of Santa Monica 6th Cycle (2021-2029) Housing Element Appendix A Appendix B Appendix C Appendix D Appendix E Appendix F Appendix G Appendix H Appendix I DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34 DocuSign Envelope ID: 55E37FC8-1BEC-4745-857A-FC1DCE739B9F Adopted and approved this 12th day of October 2021. Sue Himmelrich, Mayor I, Denise Anderson-Warren, City Clerk of the City of Santa Monica, do hereby certify that Resolution No. 11371 (CCS) was duly adopted at a meeting of the Santa Monica City Council held on the 12th day of October 2021, by the following vote: AYES: Councilmembers Brock, de la Torre, Negrete, Parra, Mayor Himmelrich NOES: Councilmember Davis, Mayor Pro Tem McCowan ABSENT: None ATTEST: Denise Anderson-Warren, City Clerk DocuSign Envelope ID: 55C39E87-90EB-48C6-AE50-2A93CA33EC34