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O27351 City Council Meeting: January 10, 2023 Santa Monica, California ORDINANCE NUMBER 2735 (CCS) (City Council Series) AN EMERGENCY INTERIM ZONING ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA EXTENDING INTERIM ZONING REGULATIONS TO UPDATE DENSITY BONUS REQUIREMENTS FOR 100% AFFORDABLE HOUSING DEVELOPMENTS WHEREAS, the State is experiencing a housing supply crisis, with housing demand far outstripping supply; 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 a 7-year period; and WHEREAS, the City of Santa Monica has long been committed to ensuring that Santa Monica is an inclusive and affordable community despite mounting market pressures; and DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 2 WHEREAS, the City’s Land Use and Circulation Element, adopted in 2010, and Zoning Ordinance, adopted in 2015, demonstrate this commitment through providing extra bonuses and incentives for one hundred percent affordable housing; and WHEREAS, on October 9, 2019, the Governor signed 18 bills into law to stimulate housing production, including: AB 1763, which amends the State Density Bonus Law, California Government Code Section 65915 et seq. (“SDBL”), to provide for increased density bonuses and incentives and concessions for housing developments that contain one hundred percent of all units in the development, including total units and density bonus units, but exclusive of a manager's unit or units, are for lower income households, except that up to 20 percent of the units in the development, including total units and density bonus units, may be for moderate-income households (“100% affordable housing developments”); and WHEREAS, AB 1763, in part, provides that the City may not impose maximum controls on density on 100% affordable housing developments located within one-half mile of a major transit stop, and that those 100% affordable housing developments shall also receive a height increase of up to three additional stories, or 33 feet; and WHEREAS, AB 1763 further provides that 100% affordable housing developments that received unlimited density are not eligible for additional waivers or reductions of development standards; and WHEREAS, on September 8, 2020, the City Council adopted Ordinance Number 2649 (CCS) which, in part, incorporated provisions of AB 1763, including the prohibition against waivers for 100% affordable housing developments that receive unlimited density; and DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 3 WHEREAS, AB 2345, which became effective on January 1, 2021, amended the SDBL to allow a city to authorize a developer to request additional waivers or reductions of development standards for 100% affordable housing developments that receive unlimited density; and WHEREAS, the City received a Regional Housing Needs Assessment (“RHNA”) allocation for is 6th Cycle (2021-2029) Housing Element (“6th Cycle Housing Element”) of 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, on October 11, 2022, the City Council adopted Resolution Number 11469 (CCS), adopting an amended 6th Cycle Housing Element, which was certified by the State on October 14, 2022; and WHEREAS, the 6th Cycle Housing Element represents the City’s longstanding commitment to affordable housing, tenant protection, housing and services for special needs groups, homeless services, sustainable development, and fair housing; and WHEREAS one of the four key principles of the 6th Cycle Housing Element is to increase housing production for all, with an emphasis on affordable housing; and WHEREAS, through Housing Element Program 2D, the City has committed to updating its density bonus ordinance to ensure consistency with SDBL and integration into the City’s land use system no later than October 15, 2023; and DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 4 WHEREAS, on August 4, 2021, the Planning Commission adopted Resolution Number 21-007 (PCS) declaring its intention to consider recommending to the City Council that the City Council amend the text of the Zoning Ordinance for consistency with the goals, policies, and programs set forth in the 6th Cycle Housing Element, including Program 2D; and WHEREAS, the Planning Commission has been conducting discussions on implementation of the Housing Element, and it is anticipated that the Commission will make a formal recommendation to the City Council in January 2023; and WHEREAS, if the Planning Commission makes a formal recommendation to the City Council in January 2023, it is anticipated that amendments to the Zoning Ordinance to implement Program 2D would not be presented to Council before February 2023, with a likely effective date of April 2023; and WHEREAS, agreeing to additional waivers or reductions of development standards for 100% affordable housing developments that receive unlimited density will facilitate the development of affordable housing within the City, consistent with the key principles of the 6th Cycle Housing Element and Program 2D; and WHEREAS, 100% affordable housing projects, with challenges in available funding, often turn to financing sources such as tax credits, which establish a strict schedule for obtaining entitlements and building permits; and WHEREAS, if the City does not agree to waivers or reductions of development standards before the anticipated effective date for implementation of Program 2D in the Spring of 2023, it could jeopardize the production of 100% affordable housing DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 5 developments within the City as well as the City’s ability to meet its RHNA allocation goals; and WHEREAS, on December 13, 2022, the City Council adopted Emergency Interim Zoning Ordinance Number 2732 (CCS) (“IZO 2732”) to allow a housing development that (a) receives a waiver from any maximum controls on density, and up to three additional stories or 33 feet in height; and (b) is not located in the Pico Neighborhood Area, as outlined in Figure 9.40.020.A, to seek additional waivers or reductions of development standards in accordance with the provisions of SDBL and Santa Monica Municipal Code Chapter 9.22; and WHEREAS, a current and immediate threat to the public health, safety and welfare continues to exist due to the State’s ongoing and unprecedented housing crisis, which has resulted in the City’s RHNA allocation that heavily focuses on affordable housing production; and WHEREAS, adoption of this emergency Interim Zoning Ordinance to extend the interim zoning regulations adopted by IZO 2732 is necessary to preserve public peace, health, safety and welfare as it will remove barriers to production of housing, particularly 100% affordable housing developments as the City completes implementation of Housing Element Program 2D. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Interim Zoning Regulations. Notwithstanding anything to the contrary in Santa Monica Municipal Code Section 9.22.070(C), a housing development that (a) receives a waiver from any maximum controls on density pursuant to Santa Monica DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 6 Municipal Code Section 9.22.050(B)(3)(d)(ii), and up to three additional stories or 33 feet in height in accordance with 9.22.060(A)(4), and (b) is not located in the Pico Neighborhood Area, as outlined in Figure 9.40.020.A, shall be eligible for, and may receive, additional waivers or reductions of development standards in accordance with the provisions of SDBL and Santa Monica Municipal Code Chapter 9.22. SECTION 2. Any provision of the Santa Monica Municipal Code or any appendix thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance. SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective immediately upon adoption. Pursuant to Sections 615 and 619 of the City Charter, and Section 9.46.090 of the Municipal Code, for the reasons stated in the recitals above, the staff report accompanying this ordinance, oral and written testimony received by the City Council, and City Council discussion, the City Council declares this ordinance to be DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 7 necessary as an emergency measure for preserving the public peace, health, and safety, with the result that this ordinance shall be introduced and adopted at the same meeting and shall become effective immediately upon its adoption. SECTION 5. This Ordinance shall be of no further force or as of May 31, 2023, unless it is otherwise extended pursuant to Santa Monica Municipal Code Section 9.46.090(C). APPROVED AS TO FORM: _________________________ DOUGLAS SLOAN City Attorney DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F Approved and adopted this 10th day of January, 2023. _____________________________ Gleam Davis, 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. 2735 (CCS) had its introduction and adoption at the Santa Monica City Council meeting held on January 10, 2023, by the following vote: AYES: Councilmembers Brock, de la Torre, Parra, Torosis, Zwick Mayor Pro Tem Negrete, Mayor Davis NOES: None ABSENT: None ATTEST: _____________________________________ _________________ Denise Anderson-Warren, City Clerk Date A summary of Ordinance No. 2735 (CCS) was duly published pursuant to California Government Code Section 40806. DocuSign Envelope ID: 29F753FC-E164-4D2A-93FF-6871003EDE8F 1/14/2023