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SR 03-15-2022 4A City Council Report City Council Meeting: March 15, 2022 Agenda Item: 4.A 1 of 22 To: Mayor and City Council From: David Martin, Director, Administration Subject: Study Session on California Senate Bill 9: The California Housing Opportunity and More Efficiency ("HOME”) Act Recommended Action Staff recommends that the City Council: 1) Review and comment on the impacts of Senate Bill 9, the California Housing Opportunity and More Efficiency (HOME) Act, in Santa Monica; 2) Provide direction to staff regarding concepts to be considered in an implementation ordinance; and 3) Direct staff to return with an ordinance to codify regulations for implementation of SB 9 that are within the City’s discretion. Summary The California Housing Opportunity and More Efficiency (“HOME”) Act, Senate Bill 9 (“SB9”), was signed by Governor Newsom on September 16, 2021, and became effective on January 1, 2022. SB9’s provisions largely are directed towards providing an incentive for homeowners to add more units to properties with an existing single-unit dwelling, by either adding an additional dwelling unit or splitting an existing lot in two. SB9 applies only to the City’s single-unit dwelling zoning districts (i.e., R1 and OP1 zones) and requires cities to issue approvals without public hearings for qualifying projects if they meet: • State and local law requirements, • Certain pre-conditions as specified in SB9, and • City’s zoning ordinance and codes, to the extent they do not conflict with SB9. 4.A Packet Pg. 7 2 of 22 SB9 has two primary pathways for applicants: 1. Option 1 - “Duplex”: Constructing two units on an existing single-unit zoned parcel; or 2. Option 2 - “Lot Split”: Subdividing a single-unit zoned parcel into two lots. These pathways are further described in this report and can be used together such that an applicant could subdivide a lot and add two units on each parcel, for a total of no more than four units. The summary of SB9’s key provisions and how they apply to Santa Monica largely repeats the information presented in the SB9 Information Item, dated December 29, 2021. Staff has analyzed SB9 and identified areas where SB9 appears to provide opportunity for the City Council to exercise local control. The purpose of this study session is to receive policy direction from the City Council regarding options that staff has identified in the course of reviewing the bill. Based on direction given at the study session, staff will return to Council with an ordinance to implement SB9 within the City. Background While SB9 requires the City to issue approvals without public hearings for qualifying projects, the one exemption is if the project would have a specific, adverse impact on public health and safety or the physical environment, as specified in Government Code Section 65589.5(d)(2). Per guidance from the State legislature, the conditions under which a project could be denied are intended to be rare. SB9’s overarching requirement is that the City’s objective municipal code standards must be applied in a manner so as not to preclude a project applicant from achieving two units of at least 800 square feet on a single lot. While SB9 includes a list of pre-conditions that projects must meet to be eligible to proceed, it is important to note that all SB9 projects will be subject to the local, regular entitlement and plan review process that applies to any new construction in Santa Monica that is subject to ministerial review. Projects will still be reviewed by various City Departments (e.g., Community Development, Fire, Public Works, Rent Control, 4.A Packet Pg. 8 3 of 22 Department of Transportation, etc.) to ensure compliance with applicable municipal code standards and technical codes (i.e., Building Code & Fire Code). Unlike State Accessory Dwelling Unit (ADU) law, SB9 does not exempt SB9 units from the City’s fees. This means that existing standards and fees would be applied to SB9 projects, including but not limited to: 1) Existing R1/OP1 Standards: The City’s existing R1 and OP1 zone standards will apply to all SB9 projects. In 2019, after an extensive public process, the R1 zone standards were updated to address concerns regarding the size of new homes and have standards that encourage remodel over new construction. 2) Existing Affordable Housing Production Program (AHPP) In-Lieu Fees: Santa Monica’s Affordable Housing Production Program, which requires the payment of an affordable housing in-lieu fee for projects involving the construction of two or more units, would apply to SB9 projects that result in two dwelling units. As a result, the City will be able to collect affordable housing in-lieu fees without any changes to the AHPP. 3) Existing Development Impact Fees and Requirements: SB9 allows the City to charge generally applicable impact fees such as Transportation and Parks and Recreation Impact Fees, utility connection fees, school fees, and fees for water neutrality and energy reach codes that require net zero energy buildings and more energy efficient buildings, and AHPP in-lieu fee payments, as applicable. The only express exception from local requirements that SB9 provides is with respect to lot splits: in this scenario, the City cannot require dedication of new rights-of-way or off- site improvements. Past Council Actions On February 9, 2021, Council took a formal position to oppose SB9, as drafted, due to concerns regarding the lack of affordability requirements in the bill and concern 4.A Packet Pg. 9 4 of 22 regarding the potential effects in Santa Monica (Attachment A). In response to Council’s stated concerns regarding SB9 as drafted at the time and as indicated in the City Manager’s report on December 7, 2021, staff has been taking a conservative approach in the interim period in order to be consistent with Council’s prior direction on SB9. The full text of SB9 is provided in Attachment B. Summary of Planning Commission Discussion and Direction On February 16, 2022, the Planning Commission held a study session to review possible concepts for consideration in an implementing ordinance for SB9. The Commission voted 4-0 (2 abstained) that it was the sense of the Planning Commission that the City Council’s implementation of SB9 ought to facilitate the certification of the Housing Element. The following summarizes the Planning Commission’s recommendation on key issues to consider in the SB9 ordinance: • Do Not Allow Accessory Dwelling Units (ADUs) in Combination with SB9 Projects o Allow applicants to add ADUs to all SB9 projects as an incentive in North of Montana, Northeast, and Sunset Park R1 neighborhoods where lots may be large enough to accommodate the units. However, do not allow applicants to add ADUs to all SB9 projects in Pico and Ocean Park where lot sizes tend to be smaller, on average. o The Commission’s recommendation was within the context of Housing Element certification and intended to expand SB9’s provisions in certain R1 neighborhoods as a strategy to demonstrate the City’s efforts to Affirmatively Further Fair Housing. • Deed Restriction for Rental Units o The Commission did not come to a consensus recommendation on this issue but there was general support for this concept as a way to ensure new units are used as permanent housing. o Commissioners who did not support this concept were: ▪ Concerned requiring SB9 units to be rental units could be a constraint to feasibility of SB9 projects. 4.A Packet Pg. 10 5 of 22 ▪ More interested in finding ways to support SB9 units as ownership units instead. • Owner Occupancy for Duplex Path o The Commission discussed the challenges in implementing and enforcing a requirement that an applicant only needs to intend to occupy one of the SB9 units as their primary residence. o One Commissioner also expressed concern that requiring owner occupancy in the duplex path would make that option infeasible as it would not allow a homeowner to demolish an existing home and replace it with two units. • Increase Demolition Allowance for Duplex Path and Reconcile with Demolition Thresholds for Properties on Historic Resources Inventory (HRI) o The Commission did not come to a consensus recommendation on this issue but generally did not support increasing the demolition limits for the duplex path beyond 25% unless there are effective ways to protect HRI properties. • Require that an Occupant of a SB9 Unit Must be Natural Person o Planning Commission supports this concept. • Update Land Division ordinance o Planning Commission supports this concept. Discussion SB9 Eligible Properties SB9’s provisions only apply in single-unit dwelling zones. In Santa Monica, these are the R1 and OP1 zones as shown in Figure 1. In Santa Monica, single-unit dwelling zones are designated as R1 and OP1, which represent approximately one-third of Santa Monica’s land area. 4.A Packet Pg. 11 6 of 22 Figure 1: Map of Single-Unit Dwelling Zones Where SB9 Projects Could be Proposed (note that there are pre-conditions that must be met that might disqualify some parcels) What Does SB9 Allow? Option 1 – Duplex Path Option 1 allows the establishment of two units on a single-family zoned property. Cities are required to issue by-right approvals for two residential units within a single-unit zoned parcel, provided the project meets the following requirements: 1) Restrictions on Location - The parcel is not located in any of the following restricted areas (note: most conditions do not apply to Santa Monica): a. Farmland b. Wetlands c. Very high fire hazard severity zone d. Hazardous waste site 4.A Packet Pg. 12 7 of 22 e. Earthquake fault zone unless the development complies with applicable seismic protection building code standards f. Special flood hazard area or regulatory floodway, unless certain Federal Emergency Management Agency (FEMA) requirements are met g. Lands identified for conservation in an adopted natural community conservation plan h. Habitat for protected species i. Lands under conservation easement j. Within a historic district or is a designated historic resource (this includes resources designated under the SMMC Chapter 9.56, the Landmark and Historic District Ordinance of the City of Santa Monica) 2) Anti-Displacement Measures - SB9 includes limitations on the types of single- unit dwellings that are eligible for redevelopment as part of an SB9 project as well as the applicant pool that may utilize SB9’s provision in an effort to reduce displacement of tenants and to restrict speculative investor use of SB9. SB9 projects must not include demolition of: a. Housing with an affordable housing deed restriction. b. Rent-controlled housing or housing subject to any form of price control. In addition to Santa Monica’s Rent Control law, AB1482 was enacted by the State in 2019 and established Statewide rent control. AB1482’s provisions contain limited exemptions for owner-occupied single-unit dwellings including where ADUs or JADUs are rented. However, AB1482 only applies to units that are owned by a real estate investment trust, a corporation or LLC in which at least one member is a corporation. c. Housing occupied by a tenant in the last three years. 3) Parcel has not had Ellis Act removal within 15 years from date of application. 4) Does not require demolition of more than 25% of existing exterior structural walls unless: a. The local ordinance allows more than 25% demolition b. Site has not been occupied by tenant in the last three years 4.A Packet Pg. 13 8 of 22 What Does SB9 Allow? Option 2 – Lot Split Path Option 2 allows the subdivision of a single-family zoned parcel into two lots. Like the duplex path, cities are required to issue by-right approvals for lot splits within a single- unit zoned parcel, provided the project meets all of the same requirements for the duplex path and the following additional requirements: 1. Lot Split Standards: a. The resulting lots are at least 1,200 square feet b. Both lots are approximately equal in size c. Neither lot is less than 40% of the original lot size d. Meet all of the City’s requirements that would apply to subdivisions, including, but not limited to, requirements that parcels have access to a public right-of-way and utility or access easements e. The property has not previously been split through SB9 (a lot can only be split once using SB9) f. The same applicant may not split adjacent properties in succession 2. Owner Occupancy: The owner must reside on the parcel for three years from the date of approval of the lot split. Owner occupancy restrictions are intended to ensure that the applicant intends to occupy one of the housing units as their principal residence. It should be noted that the statute is not clear about how this requirement where the applicant must occupy one of the units as their principal residence for three years from approval of the lot split would be practically applied in the case of a proposed demolition and replacement of the primary residence as part of an SB9 project and in the case of vacant land. Approval of the lot split is not the same as approval of building permits for structures on the resulting lots, which will occur sometime after the lot split is approved. It appears that the lot split pathway could only be used by property owners with an existing dwelling unit on the parcel that is to be split. For example, the language could be read to mean that: 4.A Packet Pg. 14 9 of 22 a) A dwelling unit must remain on the property as part of the SB9 lot split to provide a primary residence for the applicant to occupy. This has the practical effect of preventing an applicant from purchasing a single-unit dwelling, have a lot split approved, and then propose a duplex project that requires the demolition and replacement of the dwelling unit on the property. If the plan review and construction process take three years, it is possible that the applicant would never occupy the property for three years after approval of the lot split; and b) In no case could a vacant lot (i.e. no existing dwelling units on the lot) be subdivided under SB9. This is because SB9’s requirement that the applicant intend to occupy one of the units as their principal residence three years from the approval (emphasis added) of the lot split. If there are no units for the applicant to reside at the time of the lot split’s approval, it appears this condition cannot be met. SB9 prohibits the City from requiring a dedication of right-of-way or construction of off- site improvements as a condition of approving the lot split. The City Engineer, however, retains full authority, in accordance with Santa Monica Municipal Code (“SMMC”) Section 7.04.800, to require improvements to provide proper access for users and to prevent congestion and other hazards related to new development such as alleys, curbs, gutters, street trees, replacement of damaged existing sidewalks in addition to other off-site improvements that would be generally required of any new development. Standards and Process to Review SB9 Projects: Existing Objective R1/OP1 Zoning Standards SB9 generally allows the City to apply it’s “objective zoning standards”, “objective subdivision standards” and “objective design review standards” to projects seeking approval under SB9 so long as the standards to not conflict with the provisions of SB9 or prevent the establishment of two dwelling units on a single parcel of at least 800 square feet. The City’s existing Zoning Ordinance contains objective development standards for both the R1 and OP1 zones. These standards regulate new construction, 4.A Packet Pg. 15 10 of 22 including additions to existing structures, in all R1 and OP1 zones. The R1 standards were updated in 2019 in response to community concern regarding the size of new home construction. The R1 standards update was intended to address the size of new home construction, incentivize the retention of existing homes, and make the standards more user-friendly. Some of the key changes included: • Revisions to maximum allowable parcel coverage – this standard controls how much of the parcel homes can cover in addition to their overall floor area; • Exempting ADUs from parcel coverage calculations – this was intended to incentivize retention of existing homes and encourage the production of ADUs; • Revisions to maximum building height; • Increased minimum front and side upper-story stepback areas – this standard results in the second floor of homes to be smaller than the first floor; and • Size limitations on upper-story outdoor spaces – this standard places a limit on second floor outdoor spaces like balconies and decks. The City’s current R1 standards also already allow for a duplex to be proposed in the R1 zone with a Minor Use Permit (requires Zoning Administrator approval, which is a public hearing). Duplexes are not a permitted use in the OP1 zone. A duplex is defined in SMMC Section 9.51.020(A(1)(c) as: A single building that contains 2 dwelling units or 2 single unit dwellings on a single parcel. This use is distinguished from accessory dwelling units and junior accessory dwelling units, which are accessory residential units as defined by State law and Division 3, Section 9.31.025, Accessory Dwelling Units and Junior Accessory Dwelling Units. As a result, SB9 would make duplexes that satisfy SB9’s minimum requirements a permitted use that do not require a public hearing. Figure 2 illustrates the review process for SB9 Projects. 4.A Packet Pg. 16 11 of 22 Figure 2: Review Process for SB9 Projects Using Duplex and/or Lot Split Paths Allowable Objective Standards The City cannot apply objective standards that would have the effect of physically precluding the construction of two units of at least 800 square feet each or that directly conflict with the provisions of SB 9. Existing Santa Monica Zoning Code objective standards that directly conflict with SB9 are shown in Table 1. Table 1: Comparison of SB9 Standards vs. Santa Monica Zoning Code Standard SB9 Santa Monica Zoning Code (Briefly summarized from R1 standards in SMMC Section 9.07.030) Setbacks • None required for: o Existing structure, or o Structure constructed in same location in the same dimensions as existing structure • Option to require up to max of 4 feet from side and rear parcel lines for new construction • Cannot require correction of non- conforming zoning conditions, but the project also cannot increase an existing non-conformity • Side, generally 10% of parcel width • Would typically require reconstructed structures in same location to conform to current zoning standards Accessory • Not permitted if SB9 project utilizes both • Local ADU ordinance in SMMC 4.A Packet Pg. 17 12 of 22 Dwelling Units (ADUs) and Junior Accessory Dwelling Units (JADUs) “duplex” and “lot split” pathways, i.e., the parcel has been split into two lots and a duplex is constructed on both lots. • Not permitted to add an ADU or JADU if there are already two existing units on a parcel that has been split. This includes a scenario where there is a single-unit dwelling and ADU or JADU already on a parcel that is subject to a lot split under SB 9. Section 9.31.025, based on State law, which allows multi-unit properties to either convert existing non-habitable space to ADUs or add two detached ADUs All other development standards would apply to SB9 projects, as they would apply for any new development, to the extent the objective standards do not prevent the construction of two units with a minimum 800 square feet each, including: height, parcel coverage, and limitations on upper-story outdoor space that are already established in the Zoning Ordinance for R1 and OP1 zones. Parking SB9 does not permit the City to impose a minimum parking requirement in areas that are within one half-mile of a high-quality transit corridor or major transit stop. High quality transit corridors are defined as a corridor with fixed route bus service with service interval no longer than 15 minutes during peak commute hours. (Public Resources Code Section 21155(b).) Major transit stops are defined as a site containing any of the following: • An existing rail or bus rapid transit station. • A ferry terminal served by either a bus or rail transit service. • The intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods. (Public Resources Code Section 21064.3) As depicted in Figure 3, nearly all of Santa Monica is located within one-half mile walking distance of a high-quality transit corridor or major transit stop, except for some limited R1 areas that are north of Montana and a portion of Sunset Park. Areas located within one-half mile walking distance of a high-quality transit corridor or major transit 4.A Packet Pg. 18 13 of 22 stop are collectively referred to as High Quality Transit Areas (HQTAs). The City is not permitted to impose a minimum parking requirement on SB9 projects in those HQTAs. However, SB9 does permit the City to require one parking space for each SB9 unit that is not in an HQTA. Properties located within the Coastal Zone will be required to obtain a Coastal Development Permit, which may have parking requirements in accordance with the provisions of the California Coastal Act. Figure 3: Map of High Quality Transit Areas in Santa Monica. These represent areas where the City cannot impose minimum parking requirements for SB9 projects (based on current bus schedules). Leasing of SB9 Units Pursuant to SB9, the City must require that the rental of any unit created pursuant to SB 9 be for a term longer than 30 days. The City does not need to enact any additional regulations in this regard. The SMMC already has prohibitions on short-term rentals, 4.A Packet Pg. 19 14 of 22 except as provided in Chapter 6.20 related to home-sharing. The City’s home-sharing regulations would prohibit a host from residing in one unit created on a parcel under SB 9 and renting out the other unit created under SB 9 as a home-share. Further, Chapter 6.22 sets forth the City’s residential leasing regulations which require that all residential housing units be leased unfurnished, to a natural person, for an initial term of a minimum of one year, as the tenant’s primary residence. Feasibility of Requiring On-Site Affordable Housing Units in SB9 Projects in Santa Monica As part of the Housing Element update process, HR&A analyzed several scenarios to evaluate the feasibility of increasing maximum density in the City’s R1 zones (Attachment C). The purpose was to understand the feasibility of enacting affordability requirements for any new construction in the R1 zones if additional units were allowed, and the tipping point at which on-site inclusionary units would be feasible. The analysis found that a minimum of 6-7 units would be needed to support an on-site inclusionary unit in R1 zones and that replacing single-unit dwellings in R1 zones with two- and three-unit 100% market-rate ownership (i.e. condominium) projects with no affordable units would be infeasible. Since SB9 would only allow two-unit projects that would likely be rental units, due to the requirement that applicants occupy one of the units as their primary residence or that the existing unit must be owner-occupied in the first place, it is unlikely that requiring on-site affordable housing units in SB9 projects would be feasible in Santa Monica as it would effectively prohibit the creation of any additional housing in direct conflict with the objective of SB9 by creating an obstruction to implementation. Intersection of SB9 and ADU Law: Limitations on Maximum Number of Units that the City Could Establish SB9 gives the City express authority to place limits on allowing additional ADUs/JADUs. Specifically, SB9 explicitly does not require the City to allow ADUs or Junior ADUs (JADUs) on parcels that have: 1) used the lot split pathway; and 2) either construct two dwelling units on each of the resulting parcels, or already have two units (e.g. parcels that already have a single-unit dwelling and ADU and are subject to a lot split). This 4.A Packet Pg. 20 15 of 22 particular provision of SB9 appears to place a cap of no more than four units that could be established on an existing single-unit dwelling zoned parcel. SB9 does not contain limitations on ADUs and JADUs for SB9 projects that have constructed two units under SB9 but have not split the lot. However, based on preliminary guidance from the California Department of Housing and Community Development, parcels with an existing single-unit dwelling and existing ADU are considered to have one existing unit for purposes of SB9 (the ADU is not considered a primary dwelling unit). This means that one more additional SB9 unit could be added to the parcel. In this scenario, the City could enact a local ordinance that prohibits the addition of more ADUs or JADUs. Potential Impact of SB9 in Santa Monica While some cities have taken action to enact urgency ordinances to implement SB9’s provisions, as noted above, Santa Monica has existing development review and plan check processes that will govern processing of SB9 projects. A concern that has been raised by community members is how SB9 projects may alter R1 and OP1 neighborhoods. This section provides an initial assessment based on the City’s existing rules and currently available analyses and studies. As shown in Table 2, the North of Montana neighborhood has majority lot sizes of generally 7,500-8,000 sf. A very typical lot size is 50’W x 150’D. There are larger estate-size lots north of San Vicente Boulevard and in the Palisades Tract. In Sunset Park, lot sizes are typically approximately 6,000 square feet and in Pico they are generally around 5,000 sf. 4.A Packet Pg. 21 16 of 22 Table 2: Parcel Size by Neighborhood by Number & Percentage All of the R1 standards would apply to any new development on these parcels. In the case of an applicant choosing the “duplex” path, while adding a unit may violate the 55% parcel coverage limitation, SB 9 would still require the City to approve a new unit with a maximum size of 800 square feet. In the case of a lot split, creating two lots would result in lot sizes of possibly between 2,500 to 3,750 sf with lot widths of approximately 25 feet. In this case, there may not be sufficient physical space on the parcel to build more than one single-unit dwelling other than on very large lots, of which there are a limited number in Santa Monica. SB9’s Interactions with SB8 SB8 also went into effect on January 1, 2022, and prohibits cities from reducing the intensity of land use within an existing zoning district below what was in effect as of January 1, 2018. The statute defines “reducing the intensity of land use” to include reduction in height, density, floor area ratio, new or increased open space or lot size requirements, new or increased setback requirements, minimum frontage requirements, or maximum lot coverage limitations, or any other action that would individually or cumulatively reduce the site’s residential development capacity. 4.A Packet Pg. 22 17 of 22 After review of SB8’s provisions, including its extensions of key provisions of SB330 previously adopted in 2019, staff has concluded that the City can apply all objective standards that are already applicable in the R1 and OP1 districts to the extent they do not preclude the construction of SB9 units or directly conflict with SB9. However, the City cannot adopt standards that would result in reduced residential development capacity than allowed under existing zoning (i.e., reduced parcel coverage, height, etc.). Considerations for SB9 Ordinance + Concepts for Council Direction Based on staff’s analysis of SB9’s requirements and the City’s existing codes and requirements, the following are potential concepts that could be included into an SB9 implementation ordinance. Council should consider each concept and provide direction as to whether Council agrees or disagrees with the concept as proposed by staff. Where appropriate, a table showing the range of policy options from minimum SB9 compliance to incentivizing use of SB9 is also provided with each concept. 1. Applicability of ADU law to Multiple-Unit Dwellings a. What local discretion does SB9 allow? i. ADU regulations require that the City allow the addition of up to two detached ADUs or the conversion of non-habitable space into ADUs for existing multiple-unit dwellings. SB9 does not require the City to allow an applicant to add ADUs to an SB9 project, which would be considered a multiple-unit dwelling. b. Question i. Should the City require that ADU law for multi-unit developments in R1 zones only apply to multiple-unit dwellings existing as of January 1, 2022? c. Purpose i. If yes, the purpose of this would be to ensure that the SB9 duplex path does not eventually result in the establishment of 6 units (including ADUs and JADUs) from one R1 parcel but protects the 4.A Packet Pg. 23 18 of 22 ability for single-unit dwellings in multiple-unit zones to still convert to multiple-unit development and exercise rights of ADU law. Range of Policy Options Minimum SB9 Compliance Approach Incentivize SB9 • Require that applicants choose either ADU or SB9 project • Allow applicants to combine ADU and SB9 allowances on lots of at least 7,500 sf 2. Deed restricting SB9 unit as rental unit a. What local discretion does SB9 allow? i. The duplex and lot split paths do not have any requirements that resulting SB9 units be rented or sold. Should an applicant choose to rent any resulting units, SB9 requires that the rentals be for a term longer than 30 days. Rental of residential units is already regulated by Chapter 6.20 (Home-sharing and Vacation Rentals) and Chapter 6.22 (Residential Leasing Requirements) so no change to the Municipal Code is necessary in this regard. SB9 does not prohibit cities from requiring rental or sale of resulting units, as long as it does not impede construction of the SB9 unit. The lot split path on its own would only result in land division so while not required, it would be possible for the property owner to sell one or both lots without any new development or if a homeowner wanted to sell the units constructed on the resulting lot, it would require a subdivision. b. Question i. Should the City require that the additional SB9 unit created under the duplex path or a combination lot split/duplex path be rented or sold (note that ownership units would require a subdivision)? c. Purpose i. The purpose of this would be to ensure that multiple-unit dwellings created under the SB9 duplex path will contribute to alleviating Santa Monica’s housing needs. This ensures that SB9 units actually create more housing units and aligns with the City’s 4.A Packet Pg. 24 19 of 22 Affirmatively Further Fair Housing (AFFH) strategy, adopted in the 6th Cycle Housing Element1. Range of Policy Options Minimum SB9 Compliance Approach Incentivize SB9 • SB9 contains no provisions requiring that SB9 units are rented or sold • Require that SB9 units are rented or sold • Do not impose any requirements that SB9 units be rented or sold 3. Owner Occupancy for Duplex Path a. What local discretion does SB9 allow? i. The lot split path requires that the applicant sign an affidavit stating that the applicant intends to occupy one of the housing units as their principal residence for a minimum of three years from the date of approval of the lot split. SB9 does not allow the city to impose any additional owner occupancy requirements under the lot split path. The duplex path has no owner occupancy requirements. b. Questions i. Should the City require that one of the units created under the duplex path be subject to an owner occupancy requirement? c. Purpose i. Applicants choosing to pursue a SB9 lot split are required to declare that they intend to occupy the primary dwelling unit for 3 years following approval of the subdivision. Adding this requirement to applications for the SB9 duplex path would make the requirements for both pathways consistent. Range of Policy Options Minimum SB9 Compliance Approach Incentivize SB9 4.A Packet Pg. 25 20 of 22 • SB9 does not require owner occupancy for duplex path • Similar to lot split path, require that applicants for duplex path occupy one of the resulting units as their primary residence • Do not impose any owner occupancy requirements on applicants for duplex path. 4. Increase Demolition Allowance for Duplex Path a. What local discretion does SB9 allow? i. SB9 does not require the City to allow an applicant to demolish more than 25% of the existing structure in the duplex path. b. Questions i. Should the City allow projects using the duplex path to demolish more than 25% of the existing structure? c. Purpose i. Increasing the demolition allowance beyond 25% would facilitate the demolition of existing single-unit dwellings and replacement with two units. This could result in more SB9 projects that involve demolition and replacement of existing single unit dwellings with two units instead of SB9 units that are added to parcels while retaining existing single-unit dwellings. Range of Policy Options Minimum SB9 Compliance Approach Incentivize SB9 • Do not allow more than 25% of an existing single-unit dwelling to be demolished for duplex path • Allow more than 25% of an existing single-unit dwelling to be demolished for duplex path 5. Reconcile Demolition Thresholds with Historic Resources Inventory (HRI) Properties: The HRI is an informational listing of potential historic resources throughout the city. The HRI is the result of a cursory survey of properties as visible from the public right-of-way and consists of approximately 2,000 properties, a significant percentage of which are located in the R1 neighborhoods. The City’s demolition ordinance considers an HRI property demolished if 25% of the street-facing exterior is removed. Because SB9’s duplex path only requires that cities allow a minimum of 25% of the exterior walls 4.A Packet Pg. 26 21 of 22 to be removed as a pre-condition, it is possible that this provision will nullify the intended review process for technical demolitions of HRI properties because SB9 requires only a ministerial process. Therefore, the SB9 ordinance would need to make clear that State law would override the local demolition ordinance for HRI properties. a. Purpose: Adding this clarification to the SB9 ordinance would mean that HRI properties that become technically demolished (because more than 25% of the street-facing exterior has been removed) would not be required to go through the 75-day demolition waiting period. 6. Occupant must be natural person: Clarify that the applicant who is occupying one of the units per SB9 must be a natural person. a. Purpose: This would be consistent with the requirements already established in the City’s leasing regulations (Chapter 6.22) and would reduce concern of SB9’s use by speculative investors. 7. Update Land Division ordinance: Update the land division ordinance to codify the ministerial process for SB9 lot splits. a. Purpose: There is already a defined workflow for subdivisions so this would simply restate the process, eliminate the requirement for a Planning Commission hearing, and clarify findings that don’t apply. As staff receives inquiries and possibly applications for SB9 projects, there may be other development standards that may need to be adjusted or clarified. Prior to adoption of a formal implementing ordinance, the City is still required to follow State law, including SB9’s applicable provisions related to ministerial approval of qualifying projects. However, as the City Manager explained in his oral City Manager’s Report at the Council’s December 7, 2021, meeting, due to lack of specificity in some areas of SB9, staff will take a conservative approach in the interim period in order to be consistent with Council’s prior direction on SB9. Following Council direction on these concepts, staff proposes to return with an ordinance that would apply to SB9 projects. 4.A Packet Pg. 27 22 of 22 Financial Impacts and Budget Actions There is no immediate financial impact or budget action necessary as a result of recommended action. Should additional single-unit or multi-unit units be completed, modest fees will be collected. The addition of an ADU is exempt from most of the fees beyond construction fees. Staff will return to Council if specific budget actions are required in the future. Prepared By: Jing Yeo, Planning Manager Approved Forwarded to Council Attachments: A. Attachment A - Council 13 item February 9 2021 B. Attachment B - Full Text SB9 C. Attachment C - HR&A SaMoAHPP R1 Analysis D. Written Comments 4.A Packet Pg. 28 13.C February 9, 2021 Council Meeting: February 9, 2021 Santa Monica, California 1 of 1 CITY CLERK’S OFFICE - MEMORANDUM To: Mayor and City Council From: Denise Anderson-Warren, City Clerk, Records & Elections Services Department Date: February 9, 2021 13.C Request of Councilmembers Brock, Parra, and de la Torre that Council authorize the Mayor to sign a letter of opposition to SB 9 to be sent to Senator Atkins and direct staff to reinforce opposition to this bill through lobbying efforts in Sacramento. Background 4.A.a Packet Pg. 29 Attachment: Attachment A - Council 13 item February 9 2021 (4928 : SB 9 Study Session (120 mins)) BACKGROUND AND DISCUSSION: SB 9 would override local control over zoning codes, requiring cities to ministerially approve, without public input or consideration, two residential units as well as lot splits on all single-family parcels that meet specified criteria, primarily designed to prevent the demolition of existing affordable housing or displacement of moderate, low, or very-low income families or historic properties. The bill would exempt these approvals from the California Environmental Quality Act (CEQA), which was established to require the thoughtful consideration of development on the environment and infrastructure. The bill would also exempt a local government from being required to hold public hearings for coastal development permit applications under the California Coastal Act of 1976, which recognizes that there are unique zoning and land management requirements in coastal areas. Both of these state laws specifically require community participation and input; SB 9 would eliminate the currently required community participation and input. It is for these reasons that the City Council, representing our residents, should oppose this bill. In the last legislative session, Senator Toni Atkins of San Diego wrote, and the state Legislature nearly passed SB 1120, which would require a proposed housing development that contains two residential units to be considered ministerially, without discretionary review or hearing, within a single-family zone, if the proposed housing meets certain requirements. At the start of the current legislative session, Senator Atkins introduced SB 9, which similarly circumvents local planning and zoning control and public input by requiring the ministerial approval of housing developments containing two residential units and lot splits without a public hearing. If enacted, SB 9 would undermine local land use authority by imposing state legislation on local government agencies and municipalities. The City Council should strongly oppose legislation that seeks to limit local land use authority. Given this bill’s widespread impact on the City’s ability to review certain proposed housing developments, Councilmembers Brock, Parra, and de la Torre recommend the City Council authorize the Mayor to sign a letter to Senator Atkins opposing SB 9 as drafted, and direct staff to reinforce opposition to this bill through lobbying efforts in Sacramento. 4.A.a Packet Pg. 30 Attachment: Attachment A - Council 13 item February 9 2021 (4928 : SB 9 Study Session (120 mins)) Senate Bill No. 9 CHAPTER 162 An act to amend Section 66452.6 of, and to add Sections 65852.21 and 66411.7 to, the Government Code, relating to land use. [Approved by Governor September 16, 2021. Filed with Secretary of State September 16, 2021.] legislative counsel’s digest SB 9, Atkins. Housing development: approvals. The Planning and Zoning Law provides for the creation of accessory dwelling units by local ordinance, or, if a local agency has not adopted an ordinance, by ministerial approval, in accordance with specified standards and conditions. This bill, among other things, would require a proposed housing development containing no more than 2 residential units within a single-family residential zone to be considered ministerially, without discretionary review or hearing, if the proposed housing development meets certain requirements, including, but not limited to, that the proposed housing development would not require demolition or alteration of housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income, that the proposed housing development does not allow for the demolition of more than 25% of the existing exterior structural walls, except as provided, and that the development is not located within a historic district, is not included on the State Historic Resources Inventory, or is not within a site that is legally designated or listed as a city or county landmark or historic property or district. The bill would set forth what a local agency can and cannot require in approving the construction of 2 residential units, including, but not limited to, authorizing a local agency to impose objective zoning standards, objective subdivision standards, and objective design standards, as defined, unless those standards would have the effect of physically precluding the construction of up to 2 units or physically precluding either of the 2 units from being at least 800 square feet in floor area, prohibiting the imposition of setback requirements under certain circumstances, and setting maximum setback requirements under all other circumstances. The Subdivision Map Act vests the authority to regulate and control the design and improvement of subdivisions in the legislative body of a local agency and sets forth procedures governing the local agency’s processing, approval, conditional approval or disapproval, and filing of tentative, final, and parcel maps, and the modification of those maps. Under the Subdivision Map Act, an approved or conditionally approved tentative map expires 24 94 4.A.b Packet Pg. 31 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) months after its approval or conditional approval or after any additional period of time as prescribed by local ordinance, not to exceed an additional 12 months, except as provided. This bill, among other things, would require a local agency to ministerially approve a parcel map for an urban lot split that meets certain requirements, including, but not limited to, that the urban lot split would not require the demolition or alteration of housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income, that the parcel is located within a single-family residential zone, and that the parcel is not located within a historic district, is not included on the State Historic Resources Inventory, or is not within a site that is legally designated or listed as a city or county landmark or historic property or district. The bill would set forth what a local agency can and cannot require in approving an urban lot split, including, but not limited to, authorizing a local agency to impose objective zoning standards, objective subdivision standards, and objective design standards, as defined, unless those standards would have the effect of physically precluding the construction of 2 units, as defined, on either of the resulting parcels or physically precluding either of the 2 units from being at least 800 square feet in floor area, prohibiting the imposition of setback requirements under certain circumstances, and setting maximum setback requirements under all other circumstances. The bill would require an applicant to sign an affidavit stating that they intend to occupy one of the housing units as their principal residence for a minimum of 3 years from the date of the approval of the urban lot split, unless the applicant is a community land trust or a qualified nonprofit corporation, as specified. The bill would prohibit a local agency from imposing any additional owner occupancy standards on applicants. By requiring applicants to sign affidavits, thereby expanding the crime of perjury, the bill would impose a state-mandated local program. The bill would also extend the limit on the additional period that may be provided by ordinance, as described above, from 12 months to 24 months and would make other conforming or nonsubstantive changes. The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment. CEQA does not apply to the approval of ministerial projects. This bill, by establishing the ministerial review processes described above, would thereby exempt the approval of projects subject to those processes from CEQA. The California Coastal Act of 1976 provides for the planning and regulation of development, under a coastal development permit process, within the coastal zone, as defined, that shall be based on various coastal resources planning and management policies set forth in the act. 94 — 2 — Ch. 162 4.A.b Packet Pg. 32 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) This bill would exempt a local agency from being required to hold public hearings for coastal development permit applications for housing developments and urban lot splits pursuant to the above provisions. By increasing the duties of local agencies with respect to land use regulations, the bill would impose a state-mandated local program. The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for specified reasons. The people of the State of California do enact as follows: SECTION 1. Section 65852.21 is added to the Government Code, to read: 65852.21. (a)  A proposed housing development containing no more than two residential units within a single-family residential zone shall be considered ministerially, without discretionary review or a hearing, if the proposed housing development meets all of the following requirements: (1)  The parcel subject to the proposed housing development is located within a city, the boundaries of which include some portion of either an urbanized area or urban cluster, as designated by the United States Census Bureau, or, for unincorporated areas, a legal parcel wholly within the boundaries of an urbanized area or urban cluster, as designated by the United States Census Bureau. (2)  The parcel satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4. (3)  Notwithstanding any provision of this section or any local law, the proposed housing development would not require demolition or alteration of any of the following types of housing: (A)  Housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income. (B)  Housing that is subject to any form of rent or price control through a public entity’s valid exercise of its police power. (C)  Housing that has been occupied by a tenant in the last three years. (4)  The parcel subject to the proposed housing development is not a parcel on which an owner of residential real property has exercised the owner’s rights under Chapter 12.75 (commencing with Section 7060) of Division 7 of Title 1 to withdraw accommodations from rent or lease within 15 years before the date that the development proponent submits an application. 94 Ch. 162 — 3 — 4.A.b Packet Pg. 33 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) (5)  The proposed housing development does not allow the demolition of more than 25 percent of the existing exterior structural walls, unless the housing development meets at least one of the following conditions: (A)  If a local ordinance so allows. (B)  The site has not been occupied by a tenant in the last three years. (6)  The development is not located within a historic district or property included on the State Historic Resources Inventory, as defined in Section 5020.1 of the Public Resources Code, or within a site that is designated or listed as a city or county landmark or historic property or district pursuant to a city or county ordinance. (b)  (1)  Notwithstanding any local law and except as provided in paragraph (2), a local agency may impose objective zoning standards, objective subdivision standards, and objective design review standards that do not conflict with this section. (2)  (A)  The local agency shall not impose objective zoning standards, objective subdivision standards, and objective design standards that would have the effect of physically precluding the construction of up to two units or that would physically preclude either of the two units from being at least 800 square feet in floor area. (B)  (i)  Notwithstanding subparagraph (A), no setback shall be required for an existing structure or a structure constructed in the same location and to the same dimensions as an existing structure. (ii)  Notwithstanding subparagraph (A), in all other circumstances not described in clause (i), a local agency may require a setback of up to four feet from the side and rear lot lines. (c)  In addition to any conditions established in accordance with subdivision (b), a local agency may require any of the following conditions when considering an application for two residential units as provided for in this section: (1)  Off-street parking of up to one space per unit, except that a local agency shall not impose parking requirements in either of the following instances: (A)  The parcel is located within one-half mile walking distance of either a high-quality transit corridor, as defined in subdivision (b) of Section 21155 of the Public Resources Code, or a major transit stop, as defined in Section 21064.3 of the Public Resources Code. (B)  There is a car share vehicle located within one block of the parcel. (2)  For residential units connected to an onsite wastewater treatment system, a percolation test completed within the last 5 years, or, if the percolation test has been recertified, within the last 10 years. (d)  Notwithstanding subdivision (a), a local agency may deny a proposed housing development project if the building official makes a written finding, based upon a preponderance of the evidence, that the proposed housing development project would have a specific, adverse impact, as defined and determined in paragraph (2) of subdivision (d) of Section 65589.5, upon public health and safety or the physical environment and for which there is 94 — 4 — Ch. 162 4.A.b Packet Pg. 34 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) no feasible method to satisfactorily mitigate or avoid the specific, adverse impact. (e)  A local agency shall require that a rental of any unit created pursuant to this section be for a term longer than 30 days. (f)  Notwithstanding Section 65852.2 or 65852.22, a local agency shall not be required to permit an accessory dwelling unit or a junior accessory dwelling unit on parcels that use both the authority contained within this section and the authority contained in Section 66411.7. (g)  Notwithstanding subparagraph (B) of paragraph (2) of subdivision (b), an application shall not be rejected solely because it proposes adjacent or connected structures provided that the structures meet building code safety standards and are sufficient to allow separate conveyance. (h)  Local agencies shall include units constructed pursuant to this section in the annual housing element report as required by subparagraph (I) of paragraph (2) of subdivision (a) of Section 65400. (i)  For purposes of this section, all of the following apply: (1)  A housing development contains two residential units if the development proposes no more than two new units or if it proposes to add one new unit to one existing unit. (2)  The terms “objective zoning standards,” “objective subdivision standards,” and “objective design review standards” mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official prior to submittal. These standards may be embodied in alternative objective land use specifications adopted by a local agency, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances. (3)  “Local agency” means a city, county, or city and county, whether general law or chartered. (j)  A local agency may adopt an ordinance to implement the provisions of this section. An ordinance adopted to implement this section shall not be considered a project under Division 13 (commencing with Section 21000) of the Public Resources Code. (k)  Nothing in this section shall be construed to supersede or in any way alter or lessen the effect or application of the California Coastal Act of 1976 (Division 20 (commencing with Section 30000) of the Public Resources Code), except that the local agency shall not be required to hold public hearings for coastal development permit applications for a housing development pursuant to this section. SEC. 2. Section 66411.7 is added to the Government Code, to read: 66411.7. (a)  Notwithstanding any other provision of this division and any local law, a local agency shall ministerially approve, as set forth in this section, a parcel map for an urban lot split only if the local agency determines that the parcel map for the urban lot split meets all the following requirements: 94 Ch. 162 — 5 — 4.A.b Packet Pg. 35 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) (1)  The parcel map subdivides an existing parcel to create no more than two new parcels of approximately equal lot area provided that one parcel shall not be smaller than 40 percent of the lot area of the original parcel proposed for subdivision. (2)  (A)  Except as provided in subparagraph (B), both newly created parcels are no smaller than 1,200 square feet. (B)  A local agency may by ordinance adopt a smaller minimum lot size subject to ministerial approval under this subdivision. (3)  The parcel being subdivided meets all the following requirements: (A)  The parcel is located within a single-family residential zone. (B)  The parcel subject to the proposed urban lot split is located within a city, the boundaries of which include some portion of either an urbanized area or urban cluster, as designated by the United States Census Bureau, or, for unincorporated areas, a legal parcel wholly within the boundaries of an urbanized area or urban cluster, as designated by the United States Census Bureau. (C)  The parcel satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4. (D)  The proposed urban lot split would not require demolition or alteration of any of the following types of housing: (i)  Housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income. (ii)  Housing that is subject to any form of rent or price control through a public entity’s valid exercise of its police power. (iii)  A parcel or parcels on which an owner of residential real property has exercised the owner’s rights under Chapter 12.75 (commencing with Section 7060) of Division 7 of Title 1 to withdraw accommodations from rent or lease within 15 years before the date that the development proponent submits an application. (iv)  Housing that has been occupied by a tenant in the last three years. (E)  The parcel is not located within a historic district or property included on the State Historic Resources Inventory, as defined in Section 5020.1 of the Public Resources Code, or within a site that is designated or listed as a city or county landmark or historic property or district pursuant to a city or county ordinance. (F)  The parcel has not been established through prior exercise of an urban lot split as provided for in this section. (G)  Neither the owner of the parcel being subdivided nor any person acting in concert with the owner has previously subdivided an adjacent parcel using an urban lot split as provided for in this section. (b)  An application for a parcel map for an urban lot split shall be approved in accordance with the following requirements: (1)  A local agency shall approve or deny an application for a parcel map for an urban lot split ministerially without discretionary review. (2)  A local agency shall approve an urban lot split only if it conforms to all applicable objective requirements of the Subdivision Map Act (Division 94 — 6 — Ch. 162 4.A.b Packet Pg. 36 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) 2 (commencing with Section 66410)), except as otherwise expressly provided in this section. (3)  Notwithstanding Section 66411.1, a local agency shall not impose regulations that require dedications of rights-of-way or the construction of offsite improvements for the parcels being created as a condition of issuing a parcel map for an urban lot split pursuant to this section. (c)  (1)  Except as provided in paragraph (2), notwithstanding any local law, a local agency may impose objective zoning standards, objective subdivision standards, and objective design review standards applicable to a parcel created by an urban lot split that do not conflict with this section. (2)  A local agency shall not impose objective zoning standards, objective subdivision standards, and objective design review standards that would have the effect of physically precluding the construction of two units on either of the resulting parcels or that would result in a unit size of less than 800 square feet. (3)  (A)  Notwithstanding paragraph (2), no setback shall be required for an existing structure or a structure constructed in the same location and to the same dimensions as an existing structure. (B)  Notwithstanding paragraph (2), in all other circumstances not described in subparagraph (A), a local agency may require a setback of up to four feet from the side and rear lot lines. (d)  Notwithstanding subdivision (a), a local agency may deny an urban lot split if the building official makes a written finding, based upon a preponderance of the evidence, that the proposed housing development project would have a specific, adverse impact, as defined and determined in paragraph (2) of subdivision (d) of Section 65589.5, upon public health and safety or the physical environment and for which there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact. (e)  In addition to any conditions established in accordance with this section, a local agency may require any of the following conditions when considering an application for a parcel map for an urban lot split: (1)  Easements required for the provision of public services and facilities. (2)  A requirement that the parcels have access to, provide access to, or adjoin the public right-of-way. (3)  Off-street parking of up to one space per unit, except that a local agency shall not impose parking requirements in either of the following instances: (A)  The parcel is located within one-half mile walking distance of either a high-quality transit corridor as defined in subdivision (b) of Section 21155 of the Public Resources Code, or a major transit stop as defined in Section 21064.3 of the Public Resources Code. (B)  There is a car share vehicle located within one block of the parcel. (f)  A local agency shall require that the uses allowed on a lot created by this section be limited to residential uses. (g)  (1)  A local agency shall require an applicant for an urban lot split to sign an affidavit stating that the applicant intends to occupy one of the 94 Ch. 162 — 7 — 4.A.b Packet Pg. 37 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) housing units as their principal residence for a minimum of three years from the date of the approval of the urban lot split. (2)  This subdivision shall not apply to an applicant that is a “community land trust,” as defined in clause (ii) of subparagraph (C) of paragraph (11) of subdivision (a) of Section 402.1 of the Revenue and Taxation Code, or is a “qualified nonprofit corporation” as described in Section 214.15 of the Revenue and Taxation Code. (3)  A local agency shall not impose additional owner occupancy standards, other than provided for in this subdivision, on an urban lot split pursuant to this section. (h)  A local agency shall require that a rental of any unit created pursuant to this section be for a term longer than 30 days. (i)  A local agency shall not require, as a condition for ministerial approval of a parcel map application for the creation of an urban lot split, the correction of nonconforming zoning conditions. (j)  (1)  Notwithstanding any provision of Section 65852.2, 65852.21, 65852.22, 65915, or this section, a local agency shall not be required to permit more than two units on a parcel created through the exercise of the authority contained within this section. (2)  For the purposes of this section, “unit” means any dwelling unit, including, but not limited to, a unit or units created pursuant to Section 65852.21, a primary dwelling, an accessory dwelling unit as defined in Section 65852.2, or a junior accessory dwelling unit as defined in Section 65852.22. (k)  Notwithstanding paragraph (3) of subdivision (c), an application shall not be rejected solely because it proposes adjacent or connected structures provided that the structures meet building code safety standards and are sufficient to allow separate conveyance. (l)  Local agencies shall include the number of applications for parcel maps for urban lot splits pursuant to this section in the annual housing element report as required by subparagraph (I) of paragraph (2) of subdivision (a) of Section 65400. (m)  For purposes of this section, both of the following shall apply: (1)  “Objective zoning standards,” “objective subdivision standards,” and “objective design review standards” mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official prior to submittal. These standards may be embodied in alternative objective land use specifications adopted by a local agency, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances. (2)  “Local agency” means a city, county, or city and county, whether general law or chartered. (n)  A local agency may adopt an ordinance to implement the provisions of this section. An ordinance adopted to implement this section shall not be 94 — 8 — Ch. 162 4.A.b Packet Pg. 38 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) considered a project under Division 13 (commencing with Section 21000) of the Public Resources Code. (o)  Nothing in this section shall be construed to supersede or in any way alter or lessen the effect or application of the California Coastal Act of 1976 (Division 20 (commencing with Section 30000) of the Public Resources Code), except that the local agency shall not be required to hold public hearings for coastal development permit applications for urban lot splits pursuant to this section. SEC. 3. Section 66452.6 of the Government Code is amended to read: 66452.6. (a)  (1)  An approved or conditionally approved tentative map shall expire 24 months after its approval or conditional approval, or after any additional period of time as may be prescribed by local ordinance, not to exceed an additional 24 months. However, if the subdivider is required to expend two hundred thirty-six thousand seven hundred ninety dollars ($236,790) or more to construct, improve, or finance the construction or improvement of public improvements outside the property boundaries of the tentative map, excluding improvements of public rights-of-way that abut the boundary of the property to be subdivided and that are reasonably related to the development of that property, each filing of a final map authorized by Section 66456.1 shall extend the expiration of the approved or conditionally approved tentative map by 48 months from the date of its expiration, as provided in this section, or the date of the previously filed final map, whichever is later. The extensions shall not extend the tentative map more than 10 years from its approval or conditional approval. However, a tentative map on property subject to a development agreement authorized by Article 2.5 (commencing with Section 65864) of Chapter 4 of Division 1 may be extended for the period of time provided for in the agreement, but not beyond the duration of the agreement. The number of phased final maps that may be filed shall be determined by the advisory agency at the time of the approval or conditional approval of the tentative map. (2)  Commencing January 1, 2012, and each calendar year thereafter, the amount of two hundred thirty-six thousand seven hundred ninety dollars ($236,790) shall be annually increased by operation of law according to the adjustment for inflation set forth in the statewide cost index for class B construction, as determined by the State Allocation Board at its January meeting. The effective date of each annual adjustment shall be March 1. The adjusted amount shall apply to tentative and vesting tentative maps whose applications were received after the effective date of the adjustment. (3)  “Public improvements,” as used in this subdivision, include traffic controls, streets, roads, highways, freeways, bridges, overcrossings, street interchanges, flood control or storm drain facilities, sewer facilities, water facilities, and lighting facilities. (b)  (1)  The period of time specified in subdivision (a), including any extension thereof granted pursuant to subdivision (e), shall not include any period of time during which a development moratorium, imposed after approval of the tentative map, is in existence. However, the length of the moratorium shall not exceed five years. 94 Ch. 162 — 9 — 4.A.b Packet Pg. 39 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) (2)  The length of time specified in paragraph (1) shall be extended for up to three years, but in no event beyond January 1, 1992, during the pendency of any lawsuit in which the subdivider asserts, and the local agency that approved or conditionally approved the tentative map denies, the existence or application of a development moratorium to the tentative map. (3)  Once a development moratorium is terminated, the map shall be valid for the same period of time as was left to run on the map at the time that the moratorium was imposed. However, if the remaining time is less than 120 days, the map shall be valid for 120 days following the termination of the moratorium. (c)  The period of time specified in subdivision (a), including any extension thereof granted pursuant to subdivision (e), shall not include the period of time during which a lawsuit involving the approval or conditional approval of the tentative map is or was pending in a court of competent jurisdiction, if the stay of the time period is approved by the local agency pursuant to this section. After service of the initial petition or complaint in the lawsuit upon the local agency, the subdivider may apply to the local agency for a stay pursuant to the local agency’s adopted procedures. Within 40 days after receiving the application, the local agency shall either stay the time period for up to five years or deny the requested stay. The local agency may, by ordinance, establish procedures for reviewing the requests, including, but not limited to, notice and hearing requirements, appeal procedures, and other administrative requirements. (d)  The expiration of the approved or conditionally approved tentative map shall terminate all proceedings and no final map or parcel map of all or any portion of the real property included within the tentative map shall be filed with the legislative body without first processing a new tentative map. Once a timely filing is made, subsequent actions of the local agency, including, but not limited to, processing, approving, and recording, may lawfully occur after the date of expiration of the tentative map. Delivery to the county surveyor or city engineer shall be deemed a timely filing for purposes of this section. (e)  Upon application of the subdivider filed before the expiration of the approved or conditionally approved tentative map, the time at which the map expires pursuant to subdivision (a) may be extended by the legislative body or by an advisory agency authorized to approve or conditionally approve tentative maps for a period or periods not exceeding a total of six years. The period of extension specified in this subdivision shall be in addition to the period of time provided by subdivision (a). Before the expiration of an approved or conditionally approved tentative map, upon an application by the subdivider to extend that map, the map shall automatically be extended for 60 days or until the application for the extension is approved, conditionally approved, or denied, whichever occurs first. If the advisory agency denies a subdivider’s application for an extension, the subdivider may appeal to the legislative body within 15 days after the advisory agency has denied the extension. 94 — 10 — Ch. 162 4.A.b Packet Pg. 40 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) (f)  For purposes of this section, a development moratorium includes a water or sewer moratorium, or a water and sewer moratorium, as well as other actions of public agencies that regulate land use, development, or the provision of services to the land, including the public agency with the authority to approve or conditionally approve the tentative map, which thereafter prevents, prohibits, or delays the approval of a final or parcel map. A development moratorium shall also be deemed to exist for purposes of this section for any period of time during which a condition imposed by the city or county could not be satisfied because of either of the following: (1)  The condition was one that, by its nature, necessitated action by the city or county, and the city or county either did not take the necessary action or by its own action or inaction was prevented or delayed in taking the necessary action before expiration of the tentative map. (2)  The condition necessitates acquisition of real property or any interest in real property from a public agency, other than the city or county that approved or conditionally approved the tentative map, and that other public agency fails or refuses to convey the property interest necessary to satisfy the condition. However, nothing in this subdivision shall be construed to require any public agency to convey any interest in real property owned by it. A development moratorium specified in this paragraph shall be deemed to have been imposed either on the date of approval or conditional approval of the tentative map, if evidence was included in the public record that the public agency that owns or controls the real property or any interest therein may refuse to convey that property or interest, or on the date that the public agency that owns or controls the real property or any interest therein receives an offer by the subdivider to purchase that property or interest for fair market value, whichever is later. A development moratorium specified in this paragraph shall extend the tentative map up to the maximum period as set forth in subdivision (b), but not later than January 1, 1992, so long as the public agency that owns or controls the real property or any interest therein fails or refuses to convey the necessary property interest, regardless of the reason for the failure or refusal, except that the development moratorium shall be deemed to terminate 60 days after the public agency has officially made, and communicated to the subdivider, a written offer or commitment binding on the agency to convey the necessary property interest for a fair market value, paid in a reasonable time and manner. SEC. 4. The Legislature finds and declares that ensuring access to affordable housing is a matter of statewide concern and not a municipal affair as that term is used in Section 5 of Article XI of the California Constitution. Therefore, Sections 1 and 2 of this act adding Sections 65852.21 and 66411.7 to the Government Code and Section 3 of this act amending Section 66452.6 of the Government Code apply to all cities, including charter cities. SEC. 5. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or 94 Ch. 162 — 11 — 4.A.b Packet Pg. 41 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution. O 94 — 12 — Ch. 162 4.A.b Packet Pg. 42 Attachment: Attachment B - Full Text SB9 (4928 : SB 9 Study Session (120 mins)) HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 1 R1 DEVELOPMENT STANDARDS ANALYSIS CITY OF SANTA MONICA AFFORDABLE HOUSING PRODUCTION PROGRAM 2020-2021 UPDATE JUNE 2021 4.A.c Packet Pg. 43 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 2DRAFT RESULTS ANALYTIC APPROACH HR&A, with support from two design firms, tested the feasibility of 1) permitting multifamily units within existing R1 development standards, and 2) requiring an inclusionary unit with these multifamily buildings. Danielian Associates and John Kaliski Architects developed general specifications for the physical parameters of 2 through 6-unit prototypes, aiming to respect existing R1 and/or R2 standards, but noting where flexibility would be needed. Prototype details, feasibility findings and key considerations are included in the following slides. N. of Montana Sunset Park Avg. Underutilized R1 Land Sale Price $2,900,000 ($343/SF) $1,715,000 ($270/SF) Avg. Condo/ Townhouse Sale Price $2,080,000 ($1,190/SF) $1,255,000 ($955/SF) Total Development Cost (excl. Land) $550/SF $455/SF Average Unit Size 1,775 SF 1,350 SF 4.A.c Packet Pg. 44 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 3DRAFT RESULTS FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) MISSING MIDDLE HOUSING | 2 Units within R1 Standards PROS •Maintains existing standards •No costly subterranean parking CONS •Not feasible, even for 100% market rate •Cannot support an inclusionary unit 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana -11%N/A (Market Rate not Feasible) Sunset Park -26%N/A (Market Rate not Feasible) HR&A | JKA | Danielian 4.A.c Packet Pg. 45 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 4DRAFT RESULTS FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) MISSING MIDDLE HOUSING | 3 Units within R1 Standards 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana -12%N/A (Market Rate not Feasible) Sunset Park -26%N/A (Market Rate not Feasible) PROS •Maintains existing R1 zoning standards •No costly subterranean parking CONS •Requires below-market unit sizes •Not feasible, even for 100% market rate •Cannot support an inclusionary unit HR&A | JKA | Danielian 4.A.c Packet Pg. 46 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 5DRAFT RESULTS MISSING MIDDLE HOUSING | 3 Units w/ flexibility to R1 Standards 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 11%-24.7%N/A (Mod Income not Feasible) Sunset Park -3%N/A (Market Rate not Feasible) PROS •Larger units may support feasibility North of Montana •Maintains height limits R-1 standards, but not lot coverage CONS •Costly subterranean parking •Cannot support an inclusionary unit •May not be feasible South of the 10 Fwy. (e.g., Sunset Park) HR&A | JKA | Danielian FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 47 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 6DRAFT RESULTS MISSING MIDDLE HOUSING | 3 Units w/ flexibility to R1 Standards 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 15%-19.5%N/A (Mod Income not Feasible) Sunset Park 2.1%N/A (Market Rate not Feasible) PROS •Larger units may support feasibility North of Montana •No costly subterranean parking CONS •Requires adjustments to R1 height limits for part of parcel •Cannot support an inclusionary unit •May not be feasible South of the 10 Fwy. (e.g., Sunset Park) HR&A | JKA | Danielian FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 48 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 7DRAFT RESULTS PROS •Feasible for market rate units across the City, as demonstrated by R2 construction CONS •Would require major modification to existing R1 standards •Cannot support an inclusionary unit 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 28%10%7%7%6% Sunset Park 16%-4.2%N/A (Mod Income not Feasible) HR&A | JKA | Danielian FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) INCLUSIONARY HOUSING | 4 Units w/ flexibility to R2 Standards (7,500 SF Lot) 4.A.c Packet Pg. 49 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 8DRAFT RESULTS INCLUSIONARY HOUSING | 4 Units w/ flexibility to R2 Standards (6,750 SF Lot) 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 28%10%7%7%6% Sunset Park 16%-4.2%N/A (Mod Income not Feasible) PROS •Feasible for market rate units across the City, as demonstrated by R2 construction CONS •Would require major modification to existing R1 standards •Cannot support an inclusionary unit HR&A | JKA | Danielian FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 50 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 9DRAFT RESULTS 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 31%18%16%15%15% Sunset Park 19%5%2%1%-1% PROS •Feasible for market rate units across the City •May support inclusionary unit in stronger N. of Montana market areas (or potentially Citywide with smaller MI inclusionary unit) CONS •Would require modification to existing R2 standards •Would require additional height, at least for part of lot •Cannot support an inclusionary unit in most casesHR&A | JKA | Danielian INCLUSIONARY HOUSING | 5 Units w/ flexibility to R2 Standards (7,500 SF Lot) FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 51 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 10DRAFT RESULTS 100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 36%28%26%26%25% Sunset Park 25%17%14%13%11% PROS •Feasible for market rate units across the City •Would support an inclusionary unit across the City CONS •Would require substantial modification to existing R2 standards, including additional height HR&A | JKA | Danielian INCLUSIONARY HOUSING | 6 Units w/ flexibility to R2 Standards (7,500 SF Lot) FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 52 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session HR&A Advisors, Inc.Santa Monica AHPP 2021 Update | 11DRAFT RESULTS INCLUSIONARY HOUSING | 6 Units w/ flexibility to R2 Standards (6,750 SF Lot) HR&A | JKA | Danielian PROS •Feasible for market rate units across the City •Would support an inclusionary unit across the City CONS •Would require substantial modification to existing R2 standards, including additional height100% Market 1 MI Unit 1 LI Unit 1 VLI Unit 1 ELI Unit N. of Montana 36%28%26%26%25% Sunset Park 25%17%14%13%11% FEASIBILITY IMPLICATIONS* * Based on private developer Profit Margin (12.5%+ = Feasible) 4.A.c Packet Pg. 53 Attachment: Attachment C - HR&A SaMoAHPP R1 Analysis (4928 : SB 9 Study Session 1 Vernice Hankins From:Mario Fonda-Bonardi <mario@fbharchitects.com> Sent:Tuesday, March 15, 2022 1:33 PM To:councilmtgitems Subject:4A SB9 Study session EXTERNAL  Hi Council members  The discussion on S9 revolves around how much over densification should the City allow before the character of the R1  is completely lost and it becomes effectively an R2 or R3 district?  One of the hinge points is  should each  lot split  by SB9 also be allowed to have an ADU (a single R1 lot could become 4  units:  2 single family homes plus 2 ADUs). SB9 does not REQUIRE a City to allow ADU’s in each of the split lots so it  becomes an opportunity for the CIty to exercise some discretion in protecting the character of our R‐1 neighborhoods   ADUs by themselves are over‐all beneficial, but when crammed into tiny lots already split from the normal R1‐ lot size,  they can become a plague. By state laws ADUs can already be just 4’ from side and rear setback lines and up to 24’ high,  so they can present quite an invasion of privacy for all the backyards they look into, not to mention shading and parking  overload.   Therefore I would ask that you not allow ADUs in lots already split using SB9.   However if you are forced to compromise I would argue for 3 criteria before an ADU can be allowed in a lot split by  SB9.    1.The remaining lot should be at least 5000 square feet 2.It should have at least two parking spaces (not tandem) 3.No tree with a diameter greater than 3” should be removed in building the ADU Such conditions would substantially but not perfectly protect the character of the R‐1 neighborhood.  Needless to say there is a high probability that the State will next year try to  water down the few protections (such as  this not mandating ADUs in lots split by SB9)  against overdensification that SB9 provides. There is no reason to do this  damage to ourselves now.  Your favorable consideration of this request is greatly appreciated.   Mario Fonda‐Bonardi AIA  Mario@fbharchitects.com  310‐699‐0374  Item 4.A 03/15/2021 1 of 1 Item 4.A 03/15/2021 4.A.d Packet Pg. 54 Attachment: Written Comments (4928 : SB 9 Study Session (120 mins))