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SR 08-22-2023 10C City Council Report City Council Meeting: August 22, 2023 Agenda Item: 10.C 1 of 1 To: Mayor and City Council From: Douglas Sloan, City Attorney, City Attorney's Office, Administration Subject: Second Reading and Adoption of an Ordinance Amending the Text of the Zoning Ordinance to Provide Incentives for Certain Housing Projects That Filed an Application Prior to Implementation of the City’s 6th Cycle (2021 - 2029) Housing Element Recommended Action Staff recommends that the City Council adopt the attached Ordinance. Executive Summary At its meeting on July 25, 2023, the City Council introduced for first reading an Ordinance amending the text of the Zoning Ordinance to provide incentives for certain housing projects that filed an application prior to implementation of the City’s 6th Cycle (2021-2029) Housing Element. The ordinance is now presented to the City Council for adoption. Prepared By: Bradley Michaud, Principal Legal Analyst Approved Forwarded to Council Attachments: A. CDD-ORD-Incentives for Certain Housing Projects 2d 10.C Packet Pg. 390 1 City Council Meeting: August 22, 2023 Santa Monica, California ORDINANCE NUMBER _________ (CCS) (City Council Series) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA TO AMEND THE TEXT OF THE CITY’S ZONING ORDINANCE TO PROVIDE INCENTIVES FOR CERTAIN HOUSING PROJECTS THAT FILED AN APPLICATION PRIOR TO IMPLEMENTATION OF THE CITY’S 6TH CYCLE (2021-2029) HOUSING ELEMENT WHEREAS, the Housing Element Law, California Government Code Sections 65580 et seq., requires the City to review and update the Housing Element of its General Plan every eight years; and WHEREAS, the State is experiencing a housing supply crisis, with housing demand far outstripping supply; and WHEREAS, in 2018, California ranked 49th out of the 50 states in housing units per capita; and WHEREAS, the housing crisis has particularly exacerbated the need for affordable homes at prices below market rates; and WHEREAS, the housing crisis has resulted in increased poverty and homelessness, especially first-time homelessness, forced lower income residents into crowded and unsafe housing in urban areas, and forced families into lower cost new housing in greenfields at the urban-rural interface with longer commute times and a higher exposure to fire hazard; and 10.C.a Packet Pg. 391 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 2 WHEREAS, California needs an estimated 180,000 additional homes annually to keep up with population growth, and the Governor has called for 3.5 million new homes to be built over 7 years; and WHEREAS, the City received a Regional Housing Needs Assessment (“RHNA”) allocation for the 6th Cycle (2021-2029) Housing Element of approximately 8,895 housing units, with approximately 70 percent allocated as affordable housing; and WHEREAS, this RHNA allocation will require the City to permit approximately 1,000 housing units annually between 2021 and 2029, 700 of which are required to be affordable housing, representing an increase of approximately five times over the City’s RHNA allocation for the 5th Cycle (2013-2021) Housing Element; and WHEREAS, in September 2020, the City commenced a public outreach process for the 6th Cycle Housing Element, which consisted of creation of a dedicated website, presenting informational webinars, seeking input through questionnaires and surveys, forming two technical working groups, and conducting a series of study sessions with the Planning Commission, Housing Commission, Rent Control Board, and the City Council; and WHEREAS, on or about May 24, 2021, City staff published a Draft 6th Cycle Housing Element (“Draft Housing Element”); and WHEREAS, on June 2 and 3, 2021, the Planning Commission conducted a public hearing on the Draft Housing Element and made recommendations to the City Council; and WHEREAS, on June 15, 2021, the City Council conducted a public hearing to discuss the Draft Housing Element and directed staff to transmit the Draft Housing 10.C.a Packet Pg. 392 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 3 Element to the California Department of Housing and Community Development (“HCD”) with revisions; and WHEREAS, on July 1, 2021, City staff transmitted the Draft Housing Element, as revised by the City Council, to HCD for a 60-day review period; and WHEREAS on August 4, 2021, in accordance with Santa Monica Municipal Code Section 9.46.030(B), the Planning Commission adopted a Resolution of Intention, Resolution Number 21-007 (PCS), declaring its intention to consider recommending to the City Council that the City Council adopt amendments to the text of the Zoning Ordinance for consistency with the Goals, Policies and Programs of the 6th Cycle Housing Element, and minor changes, corrections and clarifications to the text of the Zoning Ordinance related to parcel coverage limitations for existing structures in the City’s R1 (Single-Unit Residential) Districts and standards for accessory structures for consistency with Council direction to return with amendments to the City’s home-share rules; and WHEREAS, on August 30, 2021, in accordance with Government Code Section 65585, HCD issued a letter to report on its review of the Draft Housing Element; and WHEREAS, HCD’s review concluded that the draft Housing Element addressed many statutory requirements, but that revisions would be necessary to substantially comply with State Housing Element Law; and WHEREAS, in its review letter, HCD set forth recommended revisions to the Draft Housing Element to, among other things, provide additional information and analysis of the City’s: housing needs, resources, and constraints related to fair housing; population and employment trends; household characteristics; Suitable Sites Inventory (“SSI”); 10.C.a Packet Pg. 393 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 4 zoning regulations for a variety of housing types; governmental and nongovernmental constraints on housing; special housing needs; and “at risk” housing units; and WHEREAS, HCD further recommended that the City make revisions to housing programs set forth in the Draft Housing Element to: demonstrate adequate capacity for the RHNA allocation; address, and where legally possible, remove, constraints to the maintenance, improvement and development of housing; promote and affirmatively further fair housing; and preserve assisted housing development for low-income households; and WHEREAS, on September 8, 2021, the Planning Commission held a discussion to consider HCD’s review and recommendations and to discuss concepts that would address those recommendations; and WHEREAS, on September 20, 2021, the Planning Commission conducted a discussion to review proposed revisions to the Draft Housing Element to address HCD’s recommendations; and WHEREAS, on September 24, 2021, Planning Commission conducted a duly noticed public hearing, and after considering oral and written testimony, adopted a Resolution of Recommendation, Resolution Number 21-011 (PCS), recommending to the City Council that the City Council adopt the 6th Cycle Housing Element; and WHEREAS, on October 12, 2021, the City Council conducted a duly noticed public hearing to consider HCD’s comments and the recommendation of the Planning Commission, and, after considering oral and written testimony, adopted Resolution Number 11371 (CCS) adopting the 6th Cycle (2021-2029) Housing Element, which the City transmitted to HCD for review and certification; and 10.C.a Packet Pg. 394 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 5 WHEREAS, on February 8, 2022, the City received a letter from HCD determining that although the Adopted 6th Cycle Housing Element addressed “many statutory requirements,” “revisions would be necessary to comply with State Housing Element Law”; and WHEREAS, the City immediately began efforts to address HCD’s letter, including scheduling a teleconference with HCD staff on February 14, 2022 to determine the City’s required next steps in order to achieve an HCD-compliant Housing Element and conducting a Study Session with the Planning Commission on March 2, 2022; and WHEREAS, after the February 14, 2022 teleconference, the City continued to meet with HCD on a consistent basis in an effort to work toward addressing HCD’s concerns to allow for the submission of a compliant Housing Element; and WHEREAS, the City also initiated other efforts to bring the 6th Cycle Housing Element into compliance, including an April 26, 2022 study session with Council, and Study Sessions with the Planning Commission on May 11 and June 1, 2022; and WHEREAS, in consideration of the comments received in the February 8, 2022 letter, consultations with HCD, and input received during study sessions with the City Council and Planning Commission, City staff prepared draft redline revisions to the Housing Element to primarily: 1) make technical revisions; 2) address affirmatively furthering fair housing obligations; and 3) strengthen the City’s commitment to development of affordable housing on City-owned sites; and WHEREAS on June 15, 2022, the Planning Commission considered the draft redline amendments to the 6th Cycle Housing Element in response to HCD’s comments, that, among other things, made technical revisions, and proposed amendments to the 10.C.a Packet Pg. 395 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 6 element’s affirmatively furthering fair housing requirements and program related to City- owned sites, made recommended revisions, and recommended that the City Council direct staff to transmit the redline revisions to HCD for review; and WHEREAS, on June 21, 2022, the City Council reviewed the draft revisions to the 6th Cycle Housing Element, made recommended revisions, and directed staff to transmit to HCD for review and comment; and WHEREAS, on July 8, 2022, the City submitted the draft revised Housing Element to HCD for review and comment; and WHEREAS, on September 6, 2022, HCD issued a letter determining that the Draft Revised Housing Element will comply with State Housing Element Law once adopted, submitted to, and reviewed by, HCD; and WHEREAS, on September 22, 2022, Planning Commission conducted a duly noticed public hearing to consider recommending to the City Council that the City Council adopt the amended 6th Cycle Housing Element, and after considering oral and written testimony, adopted Resolution Number 22-018 (PCS) recommending that the City Council adopt the amended the 6th Cycle Housing Element; and WHEREAS, on September 26, 2022, in accordance with Government Code Section 65585(b), the City posted the final draft of the amended 6th Cycle Housing Element incorporating the Planning Commission’s recommendations for updated implementation dates on the City’s website for public review, and emailed a link to all individuals and organizations that previously requested notices relating to the City’s 6th Cycle Housing Element; and 10.C.a Packet Pg. 396 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 7 WHEREAS, on October 11, 2022, the City Council conducted a duly-noticed public hearing to consider adopting the amended 6th Cycle Housing Element, and after considering oral and written testimony, adopted Resolution Number 11469 (CCS), adopting an amended 6th Cycle Housing Element, which was certified by the State on October 14, 2022; and WHEREAS, between September 30, and October 13, 2022, the City received 15 preliminary applications for housing development projects pursuant to Government Code Section 65941.1; and WHEREAS, the applicants for the 15 housing development projects assert that the projects are eligible for processing under the “builder’s remedy” provision of the Housing Accountability Act (“HAA”), California Government Code section 65589.5(d), (the “builder’s remedy applications”); and WHEREAS, the builder’s remedy provision prohibits a local agency from disapproving a housing development project, that provides at least 20 percent of total units for very low, low-, or moderate-income households, or condition approval in a manner that renders the housing development project infeasible for development for the use of very low, low-, or moderate-income households unless the local agency is able to make certain specific findings, including, but not limited to, the housing development project is inconsistent with both the jurisdiction's zoning ordinance and general plan land use designation as specified in any element of the general plan as it existed on the date the application was deemed complete, and the jurisdiction has adopted a housing element that is in substantial compliance with State Housing Element law; and 10.C.a Packet Pg. 397 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 8 WHEREAS, 14 of the 15 builder’s remedy applications propose housing development projects are inconsistent with the City’s LUCE and Zoning Ordinance, in part, because the housing development projects would far exceed height and floor area ratio (“FAR”) maximums; and WHEREAS, the Housing Element includes a variety of programs intended to achieve goals and policies related to new housing production for all income categories and the preservation of existing housing, ensuring there is equitable housing access to all neighborhoods, housing for the homeless including housing assistance and supportive services to low-income households, and eliminating housing discrimination; and WHEREAS, the Housing Element sets forth a range of goals, policies and programs, including, but not limited to, procedural changes related to streamlining the review of housing projects, updating development standards and the Affordable Housing Production Program (“AHPP”) to ensure housing projects are feasible, providing opportunities for housing in areas of the City that do not currently permit housing, incentivizing housing in areas of the City that have not historically supported housing production, amending the City’s density bonus ordinance to ensure consistency with State law and integration into the City’s land use system, and committing to the production of affordable housing on City-owned/publicly owned land; and WHEREAS, the Housing Element requires the City to implement certain programs through amendments to the Land Use and Circulation Element of the General Plan, the Bergamot Area Plan, the Downtown Community Plan, and the Zoning Ordinance in phases, subject to specified deadlines; and 10.C.a Packet Pg. 398 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 9 WHEREAS, on August 4, 2021, the Planning Commission adopted a Resolution of Intention, 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, among other things, consistency with the goals, policies and programs of the 6th Cycle Housing Element; and WHEREAS, on February 1, 2023, the Planning Commission conducted a duly noticed public hearing, and, after considering oral and written testimony regarding the proposed amendments to the text of the Zoning Ordinance, adopted Resolution Number 23-003 (PCS), recommending that the City Council amend the text of the Zoning Ordinance; and WHEREAS, on April 11, 2023, the City Council adopted Ordinance Number 2742 (CCS), amending the text of the Zoning Ordinance for consistency with the goals, policies, and programs of the 6th Cycle Housing Element, including, but not limited to, housing development incentives such as increased height and FAR maximums in the City’s nonresidential districts and streamlined ministerial approval processes for housing projects that are consistent with the City’s objective standards; and WHEREAS, the City desires to provide an alternative means of providing housing on the sites subject to the builder’s remedy applications by allowing applicants to be eligible for the housing development incentives resulting from Housing Element implementation, including increased height and FAR maximums in the City’s nonresidential districts and streamlined ministerial approval process, subject to certain additional incentives related to offsite affordable housing requirements under the AHPP, eligibility for density bonuses for projects that provide affordable housing offsite in 10.C.a Packet Pg. 399 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 10 accordance with the AHPP, including incentives and concessions, and waiver or reduction of building standards, and parking maximums in the Downtown Community Plan area; and WHEREAS, in addition to permitting application of the Housing Element implementation, these additional incentives will provide an alternative pathway for applicants to propose housing development projects on the sites subject to the builder’s remedy applications that would be consistent with the City’s LUCE and Zoning Ordinance, or any applicable Specific Plan, including increased height and FAR maximums for housing development projects in the City’s nonresidential districts as set forth the Housing Element; and WHEREAS, on May 17, 2023, the Planning Commission adopted a Resolution of Intention, Resolution Number 23-010 (PCS), declaring its intention to consider recommending to the City Council that the City Council amend the text of the Zoning Ordinance to provide the incentives for housing projects located on sites subject to a preliminary application in accordance with Government Code section 65941.1 that was filed between September 30, and October 13, 2022; and WHEREAS, on June 21, 2023, the Planning Commission conducted a duly-noticed public hearing to consider its recommendation to the City Council; and WHEREAS, on June 21, 2023, the Planning Commission conducted a duly noticed public hearing, and, after considering oral and written testimony regarding the proposed amendments to the text of the Zoning Ordinance, adopted Resolution Number 23-011 (PCS), recommending that the City Council amend the text of the Zoning Ordinance to provide incentives for housing projects located on sites subject to a preliminary 10.C.a Packet Pg. 400 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 11 application in accordance with Government Code section 65941.1 that was filed between September 30, and October 13, 2022 based on the following findings: 1. The proposed amendments to the text of the Zoning Ordinance are consistent with the General Plan and any applicable Specific Plans in that the proposed amendments incentivize the production of housing projects that are consistent with the General Plan and any applicable Specific Plan on parcels that are subject to pending applications for housing development projects that have asserted eligibility for processing under the “Builder’s Remedy” provision of the Housing Accountability Act (California Government Code section 65589.5(d)), that were filed prior to certification of the City’s 6th Cycle (2021-2029) Housing Element. These Builder’s Remedy applications do not comply with General Plan or applicable Specific Plan standards for Floor Area Ratio or building height. The new projects that may be submitted in accordance with the text amendments would comply with General Plan and applicable Specific Plan development standards for Floor Area Ratio and building height and provide new deed-restricted affordable and market-rate housing units in Santa Monica. 2. The proposed amendments to the text of the Zoning Ordinance are consistent with the purpose of the Zoning Ordinance to promote the growth of the City in an orderly manner and to promote and protect the public health, safety, and general welfare in that the amendments will incentivize the production of General Plan, Specific Plan, 10.C.a Packet Pg. 401 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 12 and Zoning Ordinance compliant housing on parcels that are subject to pending applications for housing development projects that have asserted eligibility for processing under the “Builder’s Remedy” provision of the Housing Accountability Act (California Government Code section 65589.5(d)), that were filed prior to certification of the City’s 6th Cycle (2021- 2029) Housing Element. These Builder’s Remedy applications do not comply with General Plan or Zoning Ordinance standards for Floor Area Ratio or building height. The new projects that may be submitted in accordance with the text amendments would comply with General Plan, Specific Plan, and Zoning Ordinance development standards for Floor Area Ratio and building height and therefore promote the orderly growth of the City in a manner that protects public health, safety and general welfare in comparison to projects that exceed General Plan, Specific Plan, and Zoning Ordinance development parameters; and WHEREAS, on October 12, 2021, the City Council certified the 6th Cycle Housing Element Final Environmental Impact Report (SCH No. 20212269242021), and subsequent to certification of the Housing Element EIR, the City revised the Housing Element and prepared an addendum to the Housing Element EIR (“Housing Element Addendum”); and WHEREAS, although the certified Housing Element calls for, and the certified Housing Element Suitable Sites Inventory (“SSI”) accommodates, 13,600 units, the Housing Element Addendum “conservatively considers maximum theoretical buildout with an additional 10-percent increase, for a total of 14,565 dwelling units”; and 10.C.a Packet Pg. 402 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 13 WHEREAS, therefore, the Housing Element Addendum provides a 965-unit buffer to cover and analyze potential environmental effects for units proposed beyond those accounted for in the certified Housing Element SSI; and WHEREAS, the proposed amendments to the Zoning Ordinance will restrict the density of the eligible projects (“Ordinance Projects”) (including the related offsite affordable receiver sites) to no more than the unit capacity assumed in the SSI at the site (the “SSI Credit”) plus any additional units beyond the SSI Credit so long as the additional units collectively proposed for Ordinance Projects do not exceed the buffer of 965 units; and WHEREAS, as explained more fully in the staff report dated July 25, 2023 accompanying this Ordinance, since the proposed incentives for Ordinance Projects, with the exception of the parking incentives for projects located within the Downtown, would terminate upon issuance of Administrative Approval applications for a total of 965 additional units, the potential environmental impacts resulting from amendments to the Zoning Ordinance have been adequately analyzed in the Housing Element EIR and Addendum and do not trigger any of the conditions described in CEQA Guidelines Section 15162 that would require the preparation of a supplemental EIR or negative declaration pursuant to CEQA Guidelines Section 15168(c); and WHEREAS, on July 25, 2023, the City Council conducted a duly noticed hearing to consider the findings and recommendations of the Planning Commission, and desires to adopt the proposed Zoning Ordinance amendments as set forth below. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS: 10.C.a Packet Pg. 403 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 14 SECTION 1. Based upon the oral and written testimony presented to the City Council at the public hearing on July 25, 2023, regarding the proposed changes to the text of the Zoning Ordinance, the City Council hereby makes the following findings: 1. The amendments to the text of the Zoning Ordinance are consistent with the General Plan and any applicable Specific Plans in that the amendments incentivize the production of housing projects that are consistent with the General Plan and any applicable Specific Plan on parcels that are subject to pending applications for housing development projects that have asserted eligibility for processing under the “Builder’s Remedy” provision of the Housing Accountability Act (California Government Code section 65589.5(d)), that were filed prior to certification of the City’s 6th Cycle (2021-2029) Housing Element. These Builder’s Remedy applications do not comply with General Plan or applicable Specific Plan standards for Floor Area Ratio or building height. The new projects that may be submitted in accordance with the text amendments would comply with General Plan and applicable Specific Plan development standards for Floor Area Ratio and building height and provide new deed-restricted affordable and market-rate housing units in Santa Monica. 2. The amendments to the text of the Zoning Ordinance are consistent with the purpose of the Zoning Ordinance to promote the growth of the City in an orderly manner and to promote and protect the public health, safety, and general welfare in that the amendments will incentivize the production of General Plan, Specific Plan, and Zoning Ordinance 10.C.a Packet Pg. 404 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 15 compliant housing on parcels that are subject to pending applications for housing development projects that have asserted eligibility for processing under the “Builder’s Remedy” provision of the Housing Accountability Act (California Government Code section 65589.5(d)), that were filed prior to certification of the City’s 6th Cycle (2021-2029) Housing Element. These Builder’s Remedy applications do not comply with General Plan or Zoning Ordinance standards for Floor Area Ratio or building height. The new projects that may be submitted in accordance with the text amendments would comply with General Plan, Specific Plan, and Zoning Ordinance development standards for Floor Area Ratio and building height and therefore promote the orderly growth of the City in a manner that protects public health, safety and general welfare in comparison to projects that exceed General Plan, Specific Plan, and Zoning Ordinance development parameters. Section 2. Santa Monica Municipal Code Section 9.31.198 is hereby added to read as follows: 9.31.198 Multiple-Unit Dwelling Projects Located on Certain Sites Subject to Applications Filed Prior to Implementation of 6th Cycle (2021-2029) Housing Element The purpose of this section is to incentivize the production of housing on parcels subject to applications for housing development projects that have asserted eligibility for processing under the “builder’s remedy” provision of the Housing Accountability Act (“HAA”), California Government Code section 65589.5(d), that were filed between September 30, and October 13, 2022, prior to implementation of the 6th Cycle (2021- 2029) Housing Element. 10.C.a Packet Pg. 405 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 16 A. Applicability. Subject to the provisions of subsection G, below, this section shall apply to new multiple-unit dwelling projects with applications filed between June 1, 2023 and two years after the effective date of this Section, on parcels that meet the following requirements (“eligible projects”): 1. A preliminary application was filed for a housing development project pursuant to Government Code Section 65941.1 between September 30, and October 13, 2022; and 2. The preliminary application asserted eligibility for processing under the “builder’s remedy” provision of the Housing Accountability Act, Government Code Section 65859.5(d). B. Development Standards. All eligible projects shall be subject to the development standards established for the underlying zone. C. Affordable Housing Production Program Requirements. All eligible projects shall be subject to the provisions of Chapter 9.64, Affordable Housing Production Program, except that the applicant for any eligible project may elect to satisfy the off-site provisions of Chapter 9.64, as follows: 1. Applicant may offsite any or all of the affordable housing units associated with an eligible project at any commercially or residential zoned parcel in the City (outside of the Pico Neighborhood Area) consistent with the underlying General Plan and zoning regulations (with available State Density Bonus Law benefits available under AB 1763 [Chapter 666, Stats. 2019]) for 100 percent affordable projects) provided there are no existing residential units on the target offsite property (the “Offsite Affordable Option”). 10.C.a Packet Pg. 406 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 17 For purposes herein, the Pico Neighborhood shall be defined in the Figure 9.40.020.A: “Pico Neighborhood Area”. 2. If the applicant elects the Offsite Affordable Option for an eligible project in accordance with this subsection C, the following terms and conditions apply to the eligible project: a. Affordable Housing Units. The market rate eligible project shall provide fifteen (15) percent of the total number of market rate base density (i.e., pre density bonus) units as offsite affordable housing units (i.e., five [5] percent Very Low, five (5) percent Low and five (5) percent Moderate). The affordable housing units for the Offsite Option shall not count as the basis to award a market rate density bonus for the off-site project. However, the offsite units may be used to qualify for density bonus benefits (e.g., density bonuses, incentives/concessions, waivers of development standards and reduced parking) for a one hundred percent affordable housing project at the offsite location(s). Should the applicant elect to satisfy the affordable housing requirement onsite for any of the eligible projects, it shall be fifteen (15) percent of the base density (i.e., pre-density bonus) project units. b. State Density Bonus Benefits. If exercised, the Offsite Affordable Option would enable the applicant to receive State Density Bonus Law benefits for the eligible project (i.e., up to a fifty (50) percent market rate density bonus, three (3) permitted incentives/concessions and additional waivers of development standards) as if the affordable units were to be provided onsite. 10.C.a Packet Pg. 407 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 18 c. Timing for Completion. The Offsite Affordable project must receive a certificate of occupancy prior to issuance of a certificate of occupancy for the related market rate development. However, nothing shall prevent the market rate building from obtaining a building permit and commencing construction concurrent with or prior to the corresponding offsite affordable project. D. Parking. Notwithstanding the provisions of Section 9.28.060(A), eligible projects located in the Downtown Community Plan Area shall be subject to the following maximum parking requirements: 1. Guest = 1 space per 15 units 2. Studio, no bedrooms = 1 space per unit 3. 1 bedroom = 1 space per unit 4. 2 or more bedrooms = 1 space per unit E. Additional Requirements. Except as expressly provided in this Section, eligible projects shall comply with the requirements set forth in Section 9.31.195, Multiple-Unit Dwelling Projects. F. Termination. This Section (with the exception of subsection D “Parking”) shall terminate and be of no further force and effect upon issuance of administrative approvals for 965 “additional units”. For purposes of this Section, “additional units” means the total amount of units provided by one or more eligible projects, including market rate, affordable, on-site and off-site units, that exceed the collective unit capacity allocated to the properties associated with the eligible projects under the Suitable Sites Inventory for the City’s 6th Cycle (2021-2029) Housing Element. This provision shall not impose any limit on the number of units of the eligible projects (either individually or collectively) that 10.C.a Packet Pg. 408 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading) 19 do not utilize the offsite affordable housing benefits contained in this Section 9.31.198. In addition, subsection D “Parking” shall survive termination of this Section and continue to apply to any eligible projects identified in the settlement agreement located within the Downtown Community Plan area. SECTION 3. Any provision of the Municipal Code or appendices 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 4. 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 5. 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 30 days from its adoption. APPROVED AS TO FORM: _______________________ Douglas Sloan, City Attorney 10.C.a Packet Pg. 409 Attachment: CDD-ORD-Incentives for Certain Housing Projects 2d (5908 : Housing Element Zoning - Second Reading)