Item F-1 Agenda Report — Beverly Hills City Council, October 10, 2024 (part 1 of 3)

AGENDA REPORT
Meeting Date: October 10, 2024
Item Number:

To: Honorable Mayor & City Council
From: Christine Delostrinos, Associate Planner
Chloe Chen, Principal Planner
Subject: AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO AMEND THE

BEVERLY HILLS MUNICIPAL CODE TO REVISE OCCUPANCY

PRIORITY STANDARDS FOR ELIGIBLE AFFORDABLE HOUSING

UNITS, ADD A DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT (CEQA)
Attachments: 1. Ordinance

2. Revised Affordable Housing Guidelines: Rental Units

3. Planning Commission Resolution No. 2068

4. September 12, 2024 – Planning Commission Staff Report

5. July 11, 2024 – Planning Commission Staff Report (No attachments)

RECOMMENDATION
Staff recommends that the City Council:

1. Waive the full reading and introduce by title only, an ordinance of the City of Beverly Hills to amend the Beverly Hills Municipal Code (BHMC) to revise occupancy priority standards for eligible affordable housing units and add a definition of displacement; and

2. Adopt revisions to the City of Beverly Hills Affordable Housing Guidelines for deed restricted rental units.

BACKGROUND
Occupancy Priority Standards and Displacement Definition In 2005, the City Council adopted local residential density bonus regulations consistent with the state Density Bonus law, which included occupancy priority standards for affordable housing units. In 2017, the Planning Commission reviewed and made recommendations for a revised occupancy priority standard. The City Council then adopted the revised occupancy priority standards in 2019, which are currently in effect.

The current BHMC occupancy priority standards are listed below in Table 1.

Meeting Date: October 10, 2024

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TABLE 1. EXISTING OCCUPANCY PRIORITY

TIER HOUSEHOLD TYPE
1 Senior households displaced from project site within BH (new project) 2 Households with BHUSD students displaced from project site (new project) 3 Other households displaced from project site within BH (new project) 4 Displaced senior households from MFR within BH
5 Displaced households from MFR within BH with BHUSD students 6 Other Displaced households within BH
7 Senior households
8 Other income-qualified households
The occupancy priority standards guide the placement of qualified households into any deed-restricted affordable housing units constructed in the City, including units created per the City’s inclusionary housing ordinance, state density bonus law, and any affordable replacement units required under SB 8. After implementing the occupancy priority standards for the affordable housing placement process since 2019, staff has observed the following issues that support the proposed update:
• No qualified households for Tiers 1 through 6 - No applicants that have previously applied to and have been approved for existing affordable housing units have qualified under these tiers, with applicants only falling under either Tier 7 (Senior Households) or Tier 8 (Other Income-Qualified Households). • New state law priority for low-income households - Tiers 1, 2, and 3 are superseded by the implementation of state law requirements under SB 8. SB 8 entitles lower-income households of protected units to a right of first refusal (or the first right to return) regardless of household type. • Clarification needed on the definition of displacement - Displacement is generally defined within each occupancy priority standard tier as “incomequalified households displaced from a multi-family building in the city that have or will be displaced or evicted from a multi-family building tied to a redevelopment site.” However, the definition currently varies slightly depending on the tier. • Existing time limit provisions – There are varying existing time limit provisions when considering whether a household is displaced. These provisions are inconsistent depending on the property being actively developed (Tiers 4, 5, and 6) and are conflicting with the Rent Stabilization Ordinance (“RSO”) tenant rights for displaced tenants exercising the right of first refusal for a unit from which they were displaced from due to the Ellis Act ((BHMC § 4-5-513 (G)). • Public comments on occupancy priority standards - Staff received public comments expressing that the current occupancy priority standards are too limited in their definition of displacement. These parties have expressed a desire to prioritize Beverly Hills residents who have vacated their homes due to household damages or harmful conditions, to revise Tier 1 of the priority list to include seniors generally displaced from the City (not just seniors who are displaced from the specific project site), and to suggest increased time limits for which a household is considered and eligible for displacement.

Affordable Housing Guidelines: Rental Units
In 2016, the City Council adopted Affordable Housing Program Guidelines in response to the development of affordable housing units within housing developments and in anticipation of the future development of affordable housing units in the city. The guidelines serve as a roadmap for developers and property owners outlining Meeting Date: October 10, 2024

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requirements to ensure projects with affordable housing units are appropriately managed and designed. The guidelines also provide valuable guidance to applicants interested in renting or purchasing an affordable housing unit, offering insight on the application process, eligibility requirements, and tenant obligations.

However, over the course of implementing the guidelines for several affordable housing units, certain issues have been raised during the affordable housing placement process.

Most often, the issue would be raised because the guidelines do not explicitly address certain topics, for example, whether or not a developer can require payment for renter’s insurance. This has demonstrated a need for clarification and the addition of further information within the existing guidelines. Since all of the existing affordable housing units in the City are rental units rather than for-sale units, changes to the guidelines for rental units is being prioritized at this time.

The City has recently entered a contract with an affordable housing program administrator, Housekeys, Inc. (“Housekeys”) to assist with the affordable housing program implementation. The first task for Housekeys under its contract is a review of the Affordable Housing Guidelines to improve management of the affordable housing program. These revisions aim to guide City staff, Housekeys staff, developers, tenants, and the general public regarding the monitoring and management of deed-restricted affordable housing units for rent. The guideline revisions will occur in two phases: Phase one, the current phase, will concentrate on refining guidelines relating to developers and applicants of deed-restricted affordable housing rental units. Phase two will take place at a future date and will delve into revisions of the portion of the guidelines concerning developers and applicants of deed-restricted affordable housing for-sale units (e.g. condominium units). Staff has taken this two-phase approach in updating the guidelines since the deed-restricted affordable units that have been produced in the City are exclusively rental units rather than for-sale units.

July 11, 2024 Planning Commission Study Session
The Planning Commission previously reviewed updates to the Affordable Housing Guidelines and the occupancy priority standards during a July 11, 2024 study session.

During the study session, the Planning Commission voted 3-0 to recommend the revised Affordable Housing Guidelines be adopted by City Council. A summary of the Planning Commission’s comments and recommendations are outlined in Table 3.

TABLE 3. SUMMARY OF PLANNING COMMISSION
DIRECTION FROM JULY 11, 2024 STUDY SESSION

TOPIC PLANNING COMMISSION COMMENTS AND DIRECTION
Affordable Housing Guidelines:

Rental Units
• Address reasonable accommodations and inclusive
accessibility to the application process, including a
community outreach meeting
• Do not penalize the property manager/developer if
the tenant is no longer qualified and is resistant to
vacate the unit
• Provide a clear asset calculation
Occupancy Priority Standards
• Further clarify standards
• Incorporate SB 8 requirements for “right of first
refusal”
• Prioritize
o households displaced from project site
Meeting Date: October 10, 2024

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TABLE 3. SUMMARY OF PLANNING COMMISSION
DIRECTION FROM JULY 11, 2024 STUDY SESSION

TOPIC PLANNING COMMISSION COMMENTS AND DIRECTION
o individuals who work in the city
o existing Beverly Hills residents
Displacement
• Provide a clear definition for displacement and
means for verification
• Include provisions for involuntary vacancy such as
substandard housing, natural disasters, Ellis Act
• Include voluntary vacancy such as “cash for keys”
• Reference City of Santa Monica and City of
Pasadena definition
• Increase time limit for qualification as displaced
Updates Since July 11, 2024 - Affordable Housing Guidelines: Rental Units Since the study session on July 11, staff has worked with Housekeys and the City Attorney’s Office to address the Planning Commissioner’s comments. A summary of the Planning Commissioner’s comments and staff updates are outlined in Table 4.

TABLE 4. SUMMARY OF UPDATES FOR
AFFORDABLE HOUSING GUIDELINES: RENTAL UNITS

COMMISSION COMMENT STAFF UPDATE
Reasonable Accommodations
Housekeys has launched the City’s Housekeys website
(www.housekeys20.com) for individuals to sign up
directly once an affordable housing unit is available. On this website, individuals can request reasonable
accommodations and learn more about the program,
such as creating a Housekeys account and entering an
opportunity drawing once a unit is available. Staff has also shared the most common languages spoken in the
city with Housekeys to translate and provide
appropriate resources to potential applicants. Lastly,
the City and Housekeys plan to conduct a community
outreach meeting as another opportunity to provide
information relating to the application process for
individuals who may not have access to a computer or
those who need more assistance.

Annual Tenant Recertification:

Ineligibility
Currently, the Affordable Housing Guidelines state that it is the developer’s responsibility to ensure that an
eligible tenant is occupying the affordable housing unit.

If there is a tenant that is ineligible the developer has up to 12 months to ensure that the unit is occupied by
an eligible tenant. During the July 11 study session, the Planning Commission expressed concern that the
developer should not be penalized if they have taken
the appropriate steps to replace the ineligible tenant
but the ineligible tenant is resisting to vacate the unit and therefore exceeding the 12 month limitation. The
12 month limitation is now removed from the
guidelines. The guidelines now include a separate
section for non-compliance events that introduces the
definition of a non-compliance event and requires the
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TABLE 4. SUMMARY OF UPDATES FOR
AFFORDABLE HOUSING GUIDELINES: RENTAL UNITS

COMMISSION COMMENT STAFF UPDATE
developer to provide a remedy plan detailing the
action(s) they will take to resolve the non-compliance
event. The remedy plan is required within one week of
the notification of the non-compliance event and is
subject the City's review and approval.

September 12, 2024 Planning Commission
During the September 12, 2024 Planning Commission, the commission voted 4-0 to approve the amended Resolution No. 2068 recommending adoption of an ordinance to amend occupancy priority standards for eligible affordable housing units and add a definition of displacement. A summary of the Planning Commission’s comments and recommendations are outlined in Table 5.

TABLE 5. SUMMARY OF PLANNING COMMISSION
AMENDMENTS FROM SEPTEMBER 12, 2024

COMMISSION COMMENT AMENDMENT TO ORDINANCE
Definition of displacement
should clearly state that the
City will be the responsible
agency for deeming a unit
substandard or uninhabitable.
“Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit
unsafe to occupy on a permanent basis as deemed by
the City, including but not limited to, when occupancy
is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building
deemed substandard or uninhabitable.”
Occupancy priority standard
for tier 4 limits full-time
employees to a business and
does not include those who
work for the school district,
religious facilities and other
private or public entities.
“Individuals employed full-time by a business public
or private entity operating in the City of Beverly Hills, and whose primary work location is located within the
City of Beverly Hills. For purposes of this section, fulltime employment is defined as a minimum average of 130 hours of service per calendar month over a six
month period.

ANALYSIS
ITEM 1. Occupancy Priority Standards and Displacement Definition The revised occupancy priority standards reduce the number of tiers and will provide more clarity and direction, and also further clarify the standards for better interpretation and application during the affordable housing placement process. Additionally, the revised occupancy priority standards will include a separate definition of displacement.

Table 6 provides a summary analysis of the existing and proposed occupancy priority standards, and the definition of displacement.

The revisions for each occupancy priority standard tier establish specific criteria that do not allow a household to qualify for more than one tier. For example, the proposed Tier 1 allows for all income-qualified households directly displaced from the project site the highest priority independent of household type and where Tier 2 captures generally displaced individuals with sub-tiers as defined by the proposed definition of displacement. Therefore, a weighted tier system by ranking a household higher if the household qualifies for more than one tier is not appropriate as a household cannot qualify for more than one tier with the proposed occupancy priority standards.

Meeting Date: October 10, 2024

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TABLE 6. OCCUPANCY PRIORITY STANDARD

AND DISPLACEMENT DEFINITION ANALYSIS

EXISTING PROPOSED EXPLANATION
TIER 1 - Senior households
displaced from project site
within BH (new project).

TIER 2 - Households with
BHUSD students displaced
from project site (new project).

TIER 3 - Other households
displaced from project site
within BH (new project).

TIER 1 - Existing occupants
of protected units, as defined
in Government Code Section
66300.5(h) as it may be
amended from time to time,
who are lower-income
households on a project site
and who are displaced by a
new development on the same
site and are exercising a right
of first refusal for a
comparable unit in the new
housing development, or in
any required replacement
units associated with a new
development that is not a
housing development,
pursuant to Government Code
Section 66300.6(b)(4)(B), as
amended from time to time.

Prioritize households who are
directly displaced from the
project site and are entitled to
the right of first refusal, under
SB 8.

Replaces existing Tiers 1-3,
for households displaced from
the project site from which
they are displaced (dependent
of household type).

TIER 4 - Displaced senior
households from MFR within
BH.

TIER 5 - Displaced
households from MFR within
BH with BHUSD students.

TIER 6 - Other Displaced
households within BH.

TIER 2 - Households
displaced from a property
within the City of Beverly Hills
in the past ten years in the
following order:

Senior households (62 years
and older)
Households with student(s) in
10th grade or lower enrolled in
the Beverly hills Unified
School District
Other displaced households
Prioritize households
displaced within the City, as
defined with the proposed
definition of displacement.
10 year time period of
displacement, considering the
redevelopment process and
existing tenant rights
provisions subject to RSO.

Replaces existing Tiers 4-6,
for households displaced from
any project site (dependent of
household type).

TIER 7 - Senior households. TIER 3 - Senior households
(62 years and older).

Retains existing Tier 7.

Prioritize senior households,
which addresses the City's
special housing need to
provide housing for the senior
community.

TIER 8 - Other incomequalified households.TIER 4 - Individuals employed full-time by a public or private
entity located and operating in
the City of Beverly Hills, and
whose primary work location is
located within the City of
Beverly Hills. For purposes of
this section, full-time
employment is defined as a
minimum average of 130
hours of service per calendar
month over a six month
period.

Housing Element Goal (H2.10)
to support workforce housing.

The Internal Revenue Service
defines a full-time employee
as an individual who averages
at least 130 hours of service
per a calendar month.

Understanding the varying
service hours of retail, and
service-related industries,
which primarily make up the
commercial activities in the
Business Triangle, full-time
Meeting Date: October 10, 2024

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TABLE 6. OCCUPANCY PRIORITY STANDARD

AND DISPLACEMENT DEFINITION ANALYSIS

EXISTING PROPOSED EXPLANATION
employment will be
determined by an average
calculation over a period of six
months.

Ensures that the individual is
not remotely working within
the city while the business
location and operation is
outside of the city boundary;
therefore, individuals must
provide proof of the
employer’s business location
and operation within the city
boundary.

No defined tier for “other
income-qualified households”
as the lottery system will rank
these households after all
households have been ranked
and qualified.

Displacement is generally
defined within each occupancy
priority standard tier as
“income-qualified households
displaced from a multi-family
building in the city that have or
will be displaced or evicted
from a multi-family building
tied to a redevelopment site.”
However, the definition
currently varies depending on
the tier by placing a time limit.

For purposes of this section,
displacement or displaced
shall be defined as when
persons have permanently
vacated their primary housing
unit in the City, or are at risk of
having to permanently vacate
their primary housing unit
within the City of Beverly Hills
as a result of any of the
following:
a. Demolition of the housing
unit due to a new
development project on
the subject property;
b. Voluntary vacation of the
housing unit related to a
new development project
on the subject property
(for example, accepting
cash for keys offer);
c. Withdrawal of the housing
unit from the rental
housing market under the
Ellis Act;
d. Involuntary vacation of a
housing unit due to a
natural disaster such as
an earthquake, fire, or
flood;
e. Involuntary vacation of a
housing unit as a result of
a dangerous condition of
Recent displacements due to
involuntary vacation of
uninhabitable units have
occurred in the City. This sort
of displacement is not
captured in the current BHMC
definitions of displacement.

The revised definition of
displacement would capture
involuntary vacation. The
current City procedures to
determine whether a unit is
uninhabitable would be used
to evaluate whether
involuntary displacement has
occurred, these are:
• Community Preservation
“red tag” or determines
uninhabitable pursuant to
the California Health and
Safety Code.
• Rent Stabilization Division
determines a unit is
uninhabitable by the
Means and Method Plan
process.
• Property owner is notified,
depending on the property
owner’s actions to resolve
the conditions of the unit
tenant are at risk to be
Meeting Date: October 10, 2024

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TABLE 6. OCCUPANCY PRIORITY STANDARD

AND DISPLACEMENT DEFINITION ANALYSIS

EXISTING PROPOSED EXPLANATION
the property making the
unit unsafe to occupy on a
permanent basis as
deemed by the City,
including but not limited to,
when occupancy is no
longer permitted pursuant
to California Health and
Safety Code regulations
relating to a unit or
building deemed
substandard or
uninhabitable.
displaced temporarily or
displaced permanently.

To verify if the household was
displaced due to the unit being
uninhabitable, staff will need to
work with the Rent
Stabilization Division and
Community Preservation
Division to ensure that the unit
was inspected and deemed
uninhabitable.

Revised Occupancy Priority Standard and Displacement Definition Considering state law (SB 8), the Planning Commission’s July 11 study session direction and September 12 discussion, and recommendations from the City’s housing consultant, HouseKeys, Inc. based on their knowledge of best practices from other jurisdictions, the following revised occupancy priority standards are recommended in the draft ordinance in Table 7. The ordinance will amend: 1) BHMC §10-3-1528 (Occupancy Priority) of Article 15.2 Residential Density Bonus in Title 10, Chapter 3 (Zoning) of the BHMC to include the revised occupancy priority standards and a definition for displacement; and 2) BHMC §10-3-4802 (Applicability) Article 48. Inclusionary Housing Requirements for Residential Development in Title 10 Chapter 3 (Zoning) of the BHMC to include occupancy standards by reference to the amended BHMC §10-3-1528.

TABLE 7. RECOMMENDED OCCUPANCY PRIORITY
Occupancy priority for eligible units shall apply to income-qualified households and conform to the following tiers:

A. TIER 1 - Existing occupants of protected units on a project site who are displaced by the new development and are exercising the right of first refusal for a comparable unit in the new housing development, or in any required replacement units associated with a new development that is not a housing development and shall be in accordance with the requirements set forth in Government Code Section 66300 et seq., as amended from time to time.

B. TIER 2 - Households displaced from a property within the City of Beverly Hills in the past ten years in the following order:
i. Senior households (62 years and older)
ii. Households with student(s) in 10th grade or lower enrolled in the Beverly Hills Unified School District
iii. Other households
C. TIER 3 - Senior Households (62 years and older).

D. TIER 4 - Individuals employed full-time by a public or private entity located and operating in the City of Beverly Hills, and whose primary work location is located within the City of Beverly Hills. For purposes of this section, full-time employment is defined as a minimum average of 130 hours of service per calendar month over a six month period.

Based on public comment received, the Planning Commission’s recommendations, the sometimes-lengthy timeline of the development process, current rent stabilization ordinance tenant rights to reoccupy rental units vacated due to the Ellis Act, and in order Meeting Date: October 10, 2024

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to include individuals forced to vacate uninhabitable units, the draft ordinance proposes the following definition of displacement in Table 8.

TABLE 8. RECOMMENDED DISPLACEMENT DEFINITION
For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property;
b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer); c. Withdrawal of the housing unit from the rental housing market under the Ellis Act; d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis as deemed by the City, including but not limited to, when occupancy is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed substandard or uninhabitable.

ITEM 2. Affordable Housing Guidelines: Rental Units
The revised guidelines are provided in Attachment 2. The revisions address issues that have arisen from staff's experience administering the Affordable Housing Guidelines, and additionally, the revisions include provisions that integrate Housekeys’s best practices and recommendations. In addition, the revisions are guided by compliance with fair housing laws (SB 267, Civil Rights Act of 1866, Civil Rights Act of 1968 Title VIII, Fair Employment and Housing Act, and Unruh Civil Rights Act).

Revisions to the Affordable Housing Guidelines for Rental Units accomplishes the following:

1. Overall Document Organization
The existing guidelines include six sections outlined in Table 9 below. The revised guidelines are now reorganized into seven sections which include dedicated guideline sections for developers and applicants of for-sale and rental affordable housing units. Whereas the current guidelines are intended for developer use only and provide minimal standards for rental units. The additional sections will make the guidelines user-friendly for developers, applicants, staff, and the housing administrator.
* Guidelines for Developers – Rental Units and Guidelines for Applicants – Rental units for review.

TABLE 9. AFFORDABLE HOUSING GUIDELINES SECTION COMPARISON

EXISTING REVISED
Introduction Introduction
Definition of Terms Definition of Terms
Guidelines for Developers Guidelines for Developers – For Sale Units Affordable Unit Buyer and Renter Qualifications Guidelines for Developers – Rental Units* Requirements for Buyers and Owners of
Affordable Units
Guidelines for Applicants – For Sale Units
Exceptions and Appeals Guidelines for Applicants – Rental Units* Meeting Date: October 10, 2024

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2. Revisions to Guidelines for Developers of Rental Units The guidelines revisions incorporated into the “Guidelines for Developers – Rental Units” section focus on refining the sections previously outlined in the existing guidelines through the addition of clarifications and further detailed information.

These items include referencing state and local laws, adhering to federal regulations for the calculation of total household income assets, clarifying permissible fees and charges in addition to rent, establishing design standards for units, outlining procedures for the application and screening process, and recertification procedures.

Furthermore, the revisions transfer processing and recertification responsibilities from developers to Housekeys, and more clearly outlines the responsibilities of the City, developers, and Housekeys throughout the placement process. A summary comparing the proposed revisions with the existing guidelines is provided in Table

10. TABLE 10. GUIDELINES FOR DEVELOPERS – RENTAL UNITS

TOPIC OBJECTIVE EXISTING REVISIONS
Units for Rent
Overview, PG. 1
Provide legislative
requirements for deed
restricted affordable
housing units,
including: SB 330, SB
8, Density Bonus, and
Inclusionary Housing
Placed in the
introduction of
guidelines
Moves to “Guidelines
for Developers –
Rental Units”. Revised
language to include
additional state and
local law explanations
Application Process
for Developers, PG.
2 Provide general
entitlement procedure
Outlines application
process
Adds discussion of
Replacement Unit
Determination
process and
appropriate land
entitlement approvals;
added standard
requiring affordable
units to be
comparable to market
rate units
Housing
Agreements, PG. 2
Require the
Developer to execute
a Housing Agreement
Outlines requirements Adds the requirement
that Housing
Agreement must also
describe how the
project satisfies the
City’s Inclusionary
Housing requirement
and other state law
requirements
Procedures for
Initial Rent, PG. 4
Provide maximum
monthly rent,
including fees and
charges in addition to
rent
Does not include
discussion on
maximum monthly
rent, additional fees
and charges
Adds maximum
monthly rent
calculation, rent
increase protocol, pet
fee and deposits,
parking
fees/assignment,
renter’s insurance,
utility allowance
(required to update
annually), and
security deposit
- Exceptions and Appeals
Meeting Date: October 10, 2024

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TABLE 10. GUIDELINES FOR DEVELOPERS – RENTAL UNITS

TOPIC OBJECTIVE EXISTING REVISIONS
Marketing Plan, PG.
7 Provide requirement
and procedure to
execute the marketing
plan
Outlines management
plan requirements
Adds requirement
outline for marketing
plan (narrative
summary, application
process explanation,
selection process
explanation, leasing
training timelines,
opportunity drawing
timeline, marketing
materials, and
application packet)
and onboarding
checklist for
developers; clarifies
that developer will
work with Housekeys
to complete
Application and
Screening Process,
PG. 8
Describe
responsibilities of the
property
owner/developer for
the application and
screening process
Places the
responsibility of the
application and
screening process,
including lottery upon
the property
owner/developer;
does not include
expansive definition of
displacement
Adds detailed
description of the
application and
screening process, as
executed by
Housekeys; includes
discussion of
occupancy standards,
priority list, and
responsibility of the
property
owner/developer to
pre-screen
applications for initial
eligibility; provides
additional clarity on
the definition of
displacement
Persons Ineligible to
Occupy an
Affordable Unit, PG.
11 Describe individuals
who are disqualified
from occupancy of an
affordable unit
Outlines two
categories of
disqualified applicants
Adds disqualification
for applicants who are
convicted of a felony
and procedure for
background check
Annual Report and
Monitoring, PG. 11
Describe
responsibility of the
property
owner/developer to
provide annual report
on the affordable
housing unit and that
City will conduct site
visits and review
household income for
verification
Outlines annual
reporting and
monitoring
requirements
Adds procedures for
Housekeys as the
responsible party for
conducting annual
report with the
property
owner/developer and
the annual
recertification
process.

3. Revisions to Guidelines for Applicants of Rental Units The current Affordable Housing Guidelines do not have a dedicated section offering applicants information on rental unit requirements. While the existing guidelines Meeting Date: October 10, 2024

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contain some of this information in various sections, the proposed revisions will address this gap by introducing comprehensive guidelines specifically for rental unit applicants. This section will provide an overview of the rental unit application process, including application requirements, qualifications, household income calculation methods, credit score standards, tenant obligations, and details on the appeals procedure. Furthermore, the revisions will integrate the best practices and recommendations from Housekeys to enhance clarity and effectiveness. For a summary and overview of these revisions, please refer to Table 11 below.

TABLE 11. GUIDELINES FOR APPLICANTS – RENTAL UNITS

TOPIC OBJECTIVE EXISTING REVISIONS
Process for Renting
an Affordable Unit,
PG. 14
Provide applicant
information on the
procedures and
requirements
Outlines only in the
Guidelines for
Developers
Adds detailed
overview on
Housekeys
procedures and
information for
applicant/application
intake
Application
Requirements, PG.
16 Outline application
requirements
Places the
responsibility of the
application and
screening process,
including lottery upon
the property
owner/developer,
outlined in the
Guidelines for
Developers
Adds discussion on
household
composition and
places the
responsibility for the
application process
and lottery process
on Housekeys
Description of
Qualification
Requirements, PG.
17 Provide requirements
for eligibility of the
rental unit
Describes
qualification
requirements
Removes
requirement for
citizenship
Household Income.

PG. 17
Provide calculation
on total household
income, and provides
valid income
documentation
Outlines a minimum
and a maximum total
asset, with
percentage
calculations for each
Removes minimum
and maximum asset
total, and only
applies 10% asset
calculation per state
law
Credit Score, PG.
21 Provide credit score
protocol
Describes minimum
credit score required
Adds SB 267
explanation,
applicants receiving
government rent
subsidy are not
subject to credit
check and can
provide alternative
evidence of financial
responsibility
Occupancy Priority,
PG. 22
Identify household
prioritized by the City
Describes adopted
City Occupancy
Priority List
Removes occupancy
priority list and
referred to BHMC
Persons Ineligible
to Occupy
Affordable Housing
Unit, PG. 22
Describe individuals
who are disqualified
from occupancy
Outlines two
categories of
disqualified
applicants
Adds description on
the disqualification
for applicants who
are convicted of a
felony
Tenant Obligations,
PG. 22
Describe
responsibilities of
Discussed in
developer annual
Adds annual tenant
recertification
Meeting Date: October 10, 2024

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TABLE 11. GUIDELINES FOR APPLICANTS – RENTAL UNITS

TOPIC OBJECTIVE EXISTING REVISIONS
tenant report and monitoring requirement and
protocol for tenants
maintaining or
exceeding allowed
household income
Exceptions and
Appeals, PG. 24
Provide appeals
process
City is responsible in
managing the appeal
process
Revises the appeal
process to be
managed by
Housekeys, and then
referred to City for
review, and
arbitration as a final
step

PUBLIC OUTREACH AND NOTIFICATION
The notice for this ordinance and revisions to the Affordable Housing Guidelines for deed restricted rental units, summarized in Table 12, was provided pursuant to the requirements set forth in BHMC §10-3-2.5, et seq. Additionally, an email to the Long Range Planning and Affordable Housing Guidelines interested parties lists was sent seven days prior to the hearing date.

TABLE 12. PUBLIC NOTIFICATION TABLE
Notice Type Notice Date
• Mailed Notice (500’ radius + block face; via first class mail) N/A • On-site Posted Notice N/A
• Newspaper Notice
Beverly Hills Courier
Beverly Hills Weekly / Beverly Press
9/20/2024
9/27/2024

ENVIRONMENTAL ASSESSMENT
The draft ordinance and Affordable Housing Guidelines for deed restricted rental units were assessed for compliance with California Environmental Quality Act (CEQA), the State CEQA Guidelines, and City environmental regulations, and has been determined to be exempt from CEQA per Section 15061(b)(3) of the State CEQA Guidelines, which applies the 'general rule' that CEQA does not extend to projects with no significant environmental effect. As a result, staff recommends the City Council find that the draft ordinance and the Affordable Housing Guidelines are exempt under these provisions from further review under CEQA.

FISCAL IMPACT
There are no fiscal impacts associated with the adoption or implementation of the ordinance revising the occupancy priority standards for eligible affordable housing units and the revised Affordable Housing Guidelines for rental units.

Michael Forbes, AICP
Director of Community Development
Approved By
Attachment 1
Ordinance
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ORDINANCE NO. 24-O-_______

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT (CEQA)
WHEREAS, the City of Beverly Hills (“City”) desires to amend regulations in the Beverly Hills Municipal Code (“BHMC”) regarding priorities utilized to establish the order in which income restricted housing units will be offered to qualifying households, and include a definition of displacement from existing housing;
WHEREAS, on September 12, 2024, the Planning Commission held a duly noticed public hearing and which it adopted Resolution No. 2068 recommending that the City Council amend Article 15.2 (Residential Density Bonus) and Article 48 (Inclusionary Housing Requirements for Residential Development) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC addressing priority standards to be utilized to establish the order in which income restricted housing units will be offered to qualifying households, taking into account state law requirements, reducing the number of occupancy priority tiers, include a tier prioritizing individuals who work in the city; and to add a definition of displacement and provide a consistent time limit for Tier 2 which households are considered displaced (collectively, the “Amendments”); and WHEREAS, the City Council considered the Ordinance on October 10, 2024, at a duly noticed public hearing, as prescribed by law, at which time City staff presented the matter, and interested persons had an opportunity to and did testify either in support or against the ordinance. -2-
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Following the public hearing, the City Council considered the entire record of information received at the public hearing before the City Council.

THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. The City Council finds that the adoption of this Ordinance is consistent with the General Plan because it fulfills the following General Plan and Housing Element Goals and Policies:
• H2 Housing Supply and Diversity. Provide a variety of housing types and adequate affordable housing supply
• H 2.2 Inclusionary Housing. Continue to implement an inclusionary housing program to integrate affordable units within market rate developments, and increase the availability of affordable housing throughout the community. (Imp. 10.2) • H 2.9 Jobs-Housing Balance. Promote programs seeking to provide housing opportunities for people who work in the City as a means of reducing long commutes, easing local traffic, improving air quality and helping to achieve a balanced regional jobs-housing distribution for the western portion of Los Angeles County. (Imp. 10.6) • H 2.10 Workforce Housing. Study and develop programs to increase the amount of rental and ownership housing affordable to the local workforce. (Imp. 10.3, 10.4) • H 3 Fair Housing and Special Needs Residents. Promote equal housing opportunities for all residents; including Beverly Hills’ special needs populations, so residents have a choice of appropriate housing.
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• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and nondiscrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 2. Section 10-3-1528 (Occupancy Priority) of Article 15.2 (Residential Density Bonus) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC is hereby amended in its entirety to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

A. Income restricted affordable housing units shall be offered to households meeting the income qualification and other occupancy requirements, in the order established by the following priority tiers:

1. Tier 1 - Existing occupants of protected units, as defined in Government Code Section 66300.5(h) as it may be amended from time to time, who are lowerincome households on a project site and who are displaced by a new development on the same site and are exercising a right of first refusal for a comparable unit in the new housing development, or in any required replacement units associated with a new development that is not a housing development, pursuant to Government Code Section 66300.6(b)(4)(B), as amended from time to time.

2. Tier 2 - Households displaced from a property within the City of Beverly Hills in the past ten years in the following order:
i. Senior households (62 years and older)
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ii. Households with student(s) in 10th grade or lower enrolled in the Beverly Hills Unified School District
iii. Other displaced households

3. Tier 3 - Senior Households (62 years and older).

4. Tier 4 - Individuals employed full-time by a public or private entity located and operating in the City of Beverly Hills, and whose primary work location is located within the City of Beverly Hills. For purposes of this section, full-time employment is defined as a minimum average of 130 hours of service per calendar month over a six month period.

5. For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property;
b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer);
c. Withdrawal of the housing unit from the rental housing market under the Ellis Act;
d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
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e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis as deemed by the City, including but not limited to, when occupancy is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed substandard or uninhabitable.

6. Exceptions:

1. In the event that a density bonus is granted for specific tenants pursuant to State Density Bonus Law (California Government Code § 65915 (b)(1)(E)) then the tiered list provided in this section shall not be used to fill the affordable housing units.

2. In the implementation of these priorities, the City shall in no way discriminate against any person or family due to disability or other impermissible basis.”
Section 3. Section 10-3-4802 (Applicability) of Article 48 (Inclusionary Housing Requirements for Residential Development) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC is hereby amended to read as follows:
“10-3-4802: APPLICABILITY:

A. This article shall apply to all residential developments, as defined herein, where the lots or units will be offered for sale or for rent, and when the development application or applications for the residential development is deemed complete after the effective date of Ordinance 21-O-2850.
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B. Notwithstanding subsection A, inclusionary units shall not be required for any project for which the city enters into a development agreement or for any project that is otherwise exempt under state law.

C. All inclusionary units shall be subject to the occupancy standards set forth in BHMC §10-3-1528.

Section 4. CEQA Determination. The Amendments have been environmentally reviewed pursuant to the provisions of the California Environmental Quality Act (Public Resources Code Sections 21000, et seq.(“CEQA”), the State CEQA Guidelines (California Code of Regulations, Title 14, Sections 15000, et seq.), and the City’s Local CEQA Guidelines (hereafter the “Guidelines”). The City Council finds that the introduction and adoption of the Amendments are exempt from CEQA pursuant to Section 15061(b)(3) of the State CEQA Guidelines, which applies the 'general rule' that CEQA does not extend to projects with no significant environmental effect. As such, there is no possibility that the Amendments would result in a significant effect on the environment because the modifications do not enable any physical changes to the environment, directly or indirectly.

Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (31st) day after its passage.

Adopted:

Effective:
____________________________
LESTER J. FRIEDMAN
Mayor of the City of Beverly Hills,
California
ATTEST:
_________________________ (SEAL)

HUMA AHMED
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:
___________________________ _____________________________ LAURENCE S. WIENER NANCY HUNT-COFFEY
City Attorney City Manager
Attachment 2
Revised Affordable Housing
Guidelines: Rental Units
Affordable Units Program Guidelines-City of Beverly Hills 1 4. GUIDELINES FOR DEVELOPERS – RENTAL UNITS
The purpose of Chapter 4 is to inform Developers about the rental housing procedures in the City of Beverly Hills. In this chapter, Developers will find pertinent information about the application and screening process, marketing plan requirements, and price setting.

A majority of multi-family residential rental properties are subject to the Rent Stabilization Ordinance. Therefore, Property Owners and Tenants are subject to, and eligible for, certain restrictions, rights, and protections. Please contact the City’s Rent Stabilization Division at 310- 285-1000 or [email protected] for additional information

4.1 UNITS FOR RENT OVERVIEW
Residential Developments containing Affordable Units produced as a result of the state or local legislation (including, but not limited to, Senate Bill No. 330., Senate Bill No. 8, the City’s Inclusionary Housing Ordinance, and state Density Bonus Law), or as a result of other agreements to provide Affordable Units as part of a development project in the City, shall comply with these Guidelines.

The City will work with the developer and/or property owner to issue a Replacement Unit Determination (RUD) prior to demolishing an existing multi-family residential development with protected units and before the submittal of entitlement applications. Pursuant to Government Code Section 66300 et seq., and State Density Bonus Law, replacement affordable units in a new housing development reserved for lower-income households (very-low and lowincome) must be offered to tenants from the previously existing multi-family residential development. If an affordable unit is being filled by a previous tenant of the previously existing multi-family development, then the Occupancy Priority list outlined in these guidelines is overridden per state law requirements. If a previous tenant does not wish to exercise their first right of refusal for an affordable unit, then the Occupancy Priority list in these guidelines shall apply.

Developers requesting a Density Bonus for multi-family residential developments will need to submit a Density Bonus Permit and will need to receive approval in order to exercise any requested waivers, concessions, and incentives. During the review of the Density Bonus Permit, the appropriate calculations will be applied based on the project type to determine the number of affordable housing units and their respective affordability levels.

The City’s Inclusionary Housing Ordinance is applied to all new multi-family residential developments. The ordinance requires new multi-family residential developments to provide a certain percentage of affordable housing units in the development, dependent upon the number of units in the project. The ordinance also allows the developer to provide in-lieu fees instead of constructing the affordable housing unit in the project, if the overall project has between four and nine units total. The affordable housing units required under the ordinance are reserved for very-low, low- and moderate-income households, as determined pursuant to the ordinance.

Guidelines for Affordable Housing Program - City of Beverly Hills 2 Unit Requirements
Please note that each Affordable Unit shall include the same amenities as other units (i.e. washer/dryer), and have access to the project’s common amenities, such as, for example only, open space, gyms, and meeting spaces. The affordable units shall also be generally comparable to market rate units (square footage, bedroom size, and number of bathrooms), except in the quality of interior finish materials. Affordable units shall be interspersed among market-rate dwelling units. Residents of the affordable units shall not be charged additional fees for any other amenities that are provided at no cost to other tenants, including interior appliances (fridge, stove, microwave, washer/dryer. However, if a common laundry facility is provided for the use of all tenants, no washer/dryer shall be required in the unit.

4.2 APPLICATION PROCESS FOR DEVELOPERS
Prior to the issuance of any entitlement approvals, demolition, or building permits, the developer/applicant will need to complete the RUD process. This process will determine the number of replacement units required in the new housing development, determining the number and income level of each unit. The final determination letter is required when submitting the entitlement applications.

The entitlement application(s) will specify the project type, the number of affordable housing units, and their respective levels of affordability. The entitlement application(s) shall be submitted to the Community Development Department for project review, which may include a public hearing with the Planning Commission.

Criteria for approval of the request for a density bonus permit can be found in Article 15.2 of the zoning ordinance of the Beverly Hills Municipal Code (www.beverlyhills.org/zoning).

City staff will work with the Developer as needed to assist with the application process and respond to questions about the program guidelines.

4.3 FRACTIONAL UNITS
For the purposes of these Guidelines, all density calculations resulting in fractional units shall be rounded up to the next whole number.

4.4 HOUSING AGREEMENTS
As a condition of approval of the planning entitlements, the Developer’s final affordable housing requirement will be formalized in an Affordable Housing Agreement between the City and the Developer. The affordable housing requirements will be finalized and recorded prior to the recordation of the Development’s final map or the issuance of the Development’s first building permit, whichever occurs first.

The Developer must execute the following Housing Agreement with the City:

Guidelines for Affordable Housing Program - City of Beverly Hills 3 • Affordable Housing Agreement is an agreement between the Developer and the City for a Residential Development project that includes rental Affordable Units. Such agreements are recorded against the property containing the Affordable Units; set forth the Developer’s affordable housing requirements; and require, among other things, that the Affordable Units are reserved for occupancy by Very Low-, Low-, and/or Moderate-Income households at rents affordable to such households generally for a period of not less than 55 years.

The Housing Agreement described above sets forth the legal requirements for certain Residential Development projects for compliance with the density bonus ordinance (if/when applicable), the City’s inclusionary housing requirement, and these Guidelines. The Housing Agreements are recorded against the property on which the Residential Development is being constructed. They run with the land and survive the transfer or sale of the land.

If a Developer executes an Affordable Housing Agreement for a particular Residential Development Project but the project is not built and new entitlements are sought for the applicable property, the Developer must execute a new Affordable Housing Agreement which would replace the existing Affordable Housing Agreement.

Developers seeking a new entitlement as an alternative to finalizing the plans outlined in an approved and executed Housing Agreement, must first obtain approval, and execute a new Housing Agreement for the proposed development.

The Housing Agreement must include, but is not limited to, the following information:
• Whether the Affordable Units will be ownership or rental units; • The number of Affordable Units the Developer must construct for each income category;
• The size of the Affordable Units the Developer must construct for each income category; • How the project satisfies the City’s inclusionary housing requirement and other applicable state law requirements;
• Term of affordability for the units (if applicable); and • A requirement that the Developer is required to provide a Marketing Plan as described in Section 4.6 to the City for approval and prepare the Annual Report described in Section 4.8.

After the Housing Agreement is executed, and prior to the issuance of any building permits or approval of a final map, whichever is earlier, the Agreement must be recorded, and the Developer must prepare and submit a Marketing Plan to the City’s Planning Division for approval. The Marketing Plan must specify how the Developer plans to offer the Affordable Units for lease. Additionally, the Developer shall complete and submit all items on the Onboarding Checklist (see Appendix A) to the Administrator prior to Initial Lease-Up. This checklist shall be completed each year or when a new management company commences operation of the building, including if the building is sold.

Guidelines for Affordable Housing Program - City of Beverly Hills 4 Projects approved prior to the effective date of these guidelines shall not be required to prepare a Marketing Plan prior to issuance of building permits but must prepare one before units are marketed to prospective tenants. Otherwise, projects approved prior to the effective date of these guidelines are subject to the policies and standards set forth in this document, unless exempt under applicable law.

4.5 PROCEDURES FOR INITIAL RENT
Setting the Maximum Rental Rate
Tenant-occupied units are deemed Affordable Units if the rental rate results in annual housing expenses that do not exceed 30% of the specified income level for Very Low- and Low-Income households and that do not exceed 35% of the specified income level for Moderate-Income households.

Specified income limits per county are issued annually by the California Department of Housing and Community Development (HCD) and are adjusted according to household size. For the most updated income limits please refer to the City’s Affordable Housing website at www.beverlyhills.org/affordablehousing.

Maximum rental rates for affordable rentals are based on a designated income percentage affordable to a greater range of households in each applicable income category. Assumptions regarding security deposit, utilities, and maintenance are also considered. The assumptions and calculations are detailed below.

Maximum Monthly Rents
Each year, the city will distribute a memorandum to all Affordable Unit Rental Developments that includes updated maximum monthly rents for each unit type, according to the calculations above. These income limits and maximum rents are published once a year and are based on the HCD income limits. For the most updated maximum monthly rents please refer to the City’s Affordable Housing website at www.beverlyhills.org/affordablehousing.

The maximum rental rate is also based on the number of bedrooms in the home instead of the actual number of persons in the household as household/family size can change over time. For example, if a Developer is offering a two-bedroom unit for rent, the rental rate would be calculated under a “number of bedrooms, plus one” rule for the assumed household size, not the actual household size.

Should the Affordable Rental property decide that rents shall be increased after initial occupancy due to increases in the city’s new maximum rents, Property managers must follow all California laws and Civil codes for legal rent increase protocol. Though these units are not subject to the Rent Stabilization Ordinance (RSO), rent increases shall not exceed the RSO allowable rental increase rate applicable at the time of proposed increase, with a maximum not to exceed the Maximum Monthly Rent Calculations for the household size.

Guidelines for Affordable Housing Program - City of Beverly Hills 5 Fees and Charges in Addition to Rent
Application Fees and Credit/Background Check
The developer shall not charge an application fee to the tenant. However, the developer may charge a credit check and background screening report fee to the tenant, which may not exceed the actual cost of conducting such screening. Potential landlords and their agents are prohibited from requiring or accepting any form of deposit or other inducement to hold a unit for a prospective tenant. Guarantors on behalf of prospective tenants will not be allowed.

Pursuant to SB 2671, any applicant receiving a government rent subsidy is not subject to the use of standard financial or income assessments as part of the rental housing application process, including a credit check. The applicant may provide alternative evidence of financial responsibility and ability to pay, which includes, but is not limited to, the following:
government benefit payments, pay records, and bank statements, in instances in which there is a government rent subsidy.

Pet Fees and Deposits
The developer may charge up to $250 per pet in addition to the security deposit amount to protect against damages that may be a result of the pet but may not assess a monthly pet fee.

The developer may not charge the additional pet deposit if the pet is a service animal or emotional support animal, for which official documentation shall be provided at the time of application submittal.

Parking Fees and Parking Assignment
If all units in the project are provided with an assigned parking space, the affordable unit(s) must also receive a parking space. If an assigned parking space is a condition of the lease, but parking spaces are limited, available parking will be offered on a first-come-first-serve basis regardless of whether the unit is affordable. If the unit is provided with a parking space as a condition of their lease, and the fees are applied consistently to all residents, any parking fees shall be included in the rental cost and shall not be an added fee. If not all units are provided with an assigned parking space as a condition of their lease, the developer may not charge an affordable unit a parking fee higher rate than other units in the complex. Parking spaces must be offered fairly and equitably with the same policy across the board for all units. Additionally, and notwithstanding the foregoing, the parking spaces allocated to the affordable unit(s) must comply with any conditions of approval for any entitlements for the project, and any approved plans for the entitlements.

Renter’s Insurance
If the Developer requires renter’s insurance and does not provide this for the Resident at no cost, the total amount of renter’s insurance cost will be deducted from the total monthly rent.

Proof of renter’s insurance payment amount and receipt may be requested by Developer to 1 See Govt. Code Section 12955.

Guidelines for Affordable Housing Program - City of Beverly Hills 6 verify the total renter’s insurance deduction from the total rent is correct. If the Housing Provider provides renter’s insurance at no cost to the tenant, no reduction in rent for the payment of renter’s insurance shall be required.

If the Developer does not require renter’s insurance, it is permissible to charge a fee for insurance in addition to rent, so long as the fee is consistently applied to all units at the property. If the Resident elects to purchase Renter’s Insurance separate from the lease agreement, Resident shall provide proof of the coverage to Developer prior to occupancy.

However, it is not grounds for the Developer to deny occupancy to Renter if they do not carry Renter’s Insurance. However, if Resident opts not to carry Renter’s Insurance, Resident shall waive Resident’s right to seek damages of any kind against Developerfor any personal property losses. Resident must agree to hold Housing Provider harmless from and against any and all costs, expenses and liability (including actual attorneys' fees and court costs to defend itself) related to any losses related to personal property damage. However, this shall not apply in the event that damages are caused by the Developer’s sole negligence or willful misconduct.

Rental Utility Allowance
If the tenant is required to pay for utilities, the maximum rent must be reduced to account for the cost of those utilities (the Utility Allowance as determined by the City of Beverly Hills and as updated from time to time) not including the cost of telephone, cable TV, or internet service.

The use of Ratio Utility Billing Systems (RUBS) is permitted as long as rates charged are no higher than the utility cost based on usage. The RUBS is permitted to utilize formulas that are prorated for the unit but shall not increase the cost of utilities if there are vacant units in the building; landlord shall pay the amounts due for any vacant units. If certain utilities are included in rent (water, sewer, or garbage), the tenant must receive a Utility Allowance as determined by the City of Beverly Hills. Tenants have the right to request the Developer to provide a detailed utility usage sheet.

The monthly Utility Allowance is determined and adjusted from time to time based on the average cost of utilities for each unit size. The Utility Allowance shall be reduced from the maximum rental rate and noted in the lease agreement.

Security Deposits
Security deposits cannot exceed one month’s rent. For households with Section 8 Housing Choice Vouchers, or other federally subsidized housing programs, if the security deposit is equal to one month’s rent, it shall be the tenant’s portion of the rent and not the overall rent amount.

Guidelines for Affordable Housing Program - City of Beverly Hills 7 Pursuant to AB 12, effective July 1, 2024,2 it is prohibited to require a security deposit greater than one month’s rent from an eligible tenant. For landlords who own no more than two residential rental properties that collectively include no more than four total rental units, the limit is two times the monthly rent, but only if the landlord is a natural person or a limited liability company in which all members are natural persons.

4.6 CREATING THE MARKETING PLAN FOR RENTAL AFFORDABLE UNITS Prior to the issuance of building permits, the Developer must submit a Marketing Plan to the City for its approval. The Administrator will review and assist with the finalization and submittal of the approved Marketing Plan. The Marketing Plan must outline how the management firm will market and maintain the affordable rental units. Additionally, the Marketing Plan will include a Marketing Milestone Timeline (see Appendix B). Specifically, the Marketing Plan must contain the following information:

1. NARRATIVE SUMMARY
A one-page narrative summary suitable for advertising the availability of Affordable Units on the City webpage and other locations as specified by City staff. The summary must include:
• A description of the total number of Affordable Units and market-rate units in the Residential Development;
• The rental rate for each Affordable Unit;
• The amenities included in the unit; and
• Contact information for leasing representatives (including a name, telephone number, address, and e-mail address).

2. APPLICATION PROCESS EXPLANATION
An explanation of the application process and the deadline for entering opportunity drawings and submitting applications. If the development is phased, the Developer must establish deadlines and unit numbers for each phase of the development that include Affordable Units in each phase.

3. SELECTION PROCESS EXPLANATION
An explanation of how the Developer will implement the occupancy prioritization system as outlined in these guidelines.

4. LEASING TRAINING TIMELINE
2 See Civil Code Section 1950.5.

Guidelines for Affordable Housing Program - City of Beverly Hills 8 Timeline for the Developer’s sales staff to meet with the city or its Administrator to receive training on the tenant selection and application process. This training shall occur before City staff approval of the marketing plan.

5. OPPORTUNITY DRAWING TIMELINE
Opportunity Drawing Timeline, including the date the drawing will be open to the public, the drawing deadline, and the file submission deadline. If the development is a phased project, information must be provided on the number of phases and the timelines for those phases.

6. MARKETING MATERIALS
Copies of materials that will be used to market the Affordable Units. Marketing Plans shall include an outreach strategy. Outreach to potential tenants will occur for at least 30 days prior to the application submittal period.

7. APPLICATION PACKET
The application packet must include provisions to request the following from the applicant:
• Application for the Affordable Unit;
• Income and asset documentation;
• Complete Federal tax returns with all forms, attachments, and income verification; • Identification confirming all applicants are legal residents of the United States, including current, valid documentation identifying the applicant’s social security number/taxpayer ID;
• Unit identification: address, number of bedrooms, and rental rate; • Credit authorization, release of information, and credit report; and • Evidence of funds to be used as a security deposit.

The Developer may not market any units until the City has provided written approval of the Marketing Plan. The Developer may not market any units until the Developer’s Leasing Staff has been trained by City Staff in the application process. The Leasing Staff must be able to explain the application process to the potential tenants. Marketing materials shall direct applicants to the property’s Landing page at www.HouseKeys20.com or the city’s website at www.beverlyhills.org/affordablehousing.

After the Marketing Plan has been approved by the City, the Developer must post the Marketing Plan on the Project Place (www.housingrightscenter.org/rental-listing), City Website, the Administrator’s website, and other sites as directed by the City. Additionally, Developer will be required to submit items on the Onboarding Checklist (see Appendix A) to the Administrator prior to Initial Lease-Up.

Guidelines for Affordable Housing Program - City of Beverly Hills 9 4.7 APPLICATION AND SCREENING PROCESS
The City of Beverly Hills has contracted HouseKeys, Inc. (“Administrator”) as its program administrator for the Affordable Housing Program. As units become available, they will be marketed at www.HouseKeys20.com.

Affordable Housing Applicant Registration: Applicants interested in the City’s Affordable Housing Program shall register for an Application ID at www.myhousekeys.com to receive emails regarding upcoming opportunities, drawing entry deadlines, and instructions to apply.

Please note, only one application per household and development is allowed. Multiple applications for one development will disqualify the applicant and/or the household from the Opportunity Drawing process. In addition, vacancies will be posted at www.beverlyhills.org/affordablehousing. Application selection will be based on a lottery system using an Opportunity Drawing process managed by HouseKeys, Inc. and monitored by the City. The Developer agrees to pay a pass-through fee for any services rendered by HouseKeys, Inc. including underwriting services.

Within ten (10) days of notification of an upcoming vacancy, the Developer shall submit a vacancy notice to Administrator and City providing information regarding the property, unit size, and unit make-ready date. When an Affordable Rental Unit, or “Opportunity,” becomes available, HouseKeys, Inc. will create an Opportunity Drawing. Interested applicants with an Application ID for the Program will be notified of the drawing by email. Each Opportunity will be assigned an Opportunity Drawing (OD) Index Number. This number will be used to track the Opportunity. Applicants must enter the drawing by the Entry Deadline to be considered for the Initial Ranking. Once the Drawing deadline has passed, HouseKeys, Inc. will rank the applicants who have entered the drawing using a lottery system. The lottery system creates a randomized number that is assigned to each applicant who has entered the Drawing before the Drawing Deadline. After the applicants are randomized, the applicable City Occupancy Priority List will be added, and the applicants will be re-sorted. Applicants who meet the stated preferences in Section 6.6 of this guide will be processed first.

Once an applicant has entered an Opportunity Drawing, they will be provided with a File Submission Deadline. The applicant must adhere to this deadline and upload their completed Application Documents into their www.myHouseKeys.com File Cabinet before the deadline listed. Applicants who do not upload their Application by the File Submission Deadline will lose their initial ranking and will be processed after applicants who submit documents timely. The Opportunity Drawing will remain open until the opportunity has been filled. Questions about applying for opportunities, registering for www.myHouseKeys.com, or the drawing process, shall be directed to [email protected].

Once the Opportunity Drawing deadline has passed, HouseKeys, Inc. will complete the following steps:
• On the day of the lottery all applicants who entered before the Entry Deadline will be included in the Initial Ranking.

Guidelines for Affordable Housing Program - City of Beverly Hills 10 • All applicants included in the drawing will be sorted randomly using a randomizer. • The City Occupancy Priority List will then be applied to all applicants included in the Drawing who meet City Occupancy Priority List.
• The Ranked List will be re-sorted to place applicants with City Occupancy Priority List on the top of the List. However, the City Occupancy Priority List will be superseded by preference given to applicants pursuant to provisions of SB 330 / SB 8 (Government Code Section 66300 et seq.).

Once the Lottery is held, and the Final Ranked List is prepared, HouseKeys, Inc. will post the Final Ranked List on the project’s profile on www.HouseKeys20.com and the Applicants will be notified of their ranking. Applicants must submit their completed application no later than the File Submission Deadline indicated on the Opportunity Drawing Notification. Applications received after the File Submission Deadline will void the initial ranking and will be processed after applicants who submitted their applications promptly.

Once the lottery list has been re-sorted for the City Occupancy Priority List, the Final Ranked List will be sent to the Developer for qualification screening. The Final Ranked List and lottery is only applicable to the project that it is referencing. A lottery and Final Ranked List are conducted for each project. Applicants will be contacted in ranked order and notations will be added to the ranked list as to the dates and times of outreach and the results of such contact.

The Developer will screen applicants based on qualification factors including background screening, minimum income requirements, City Occupancy Priority List, and occupancy standards. Rental history verifications or landlord screenings are not permitted, except for a background screening. The only credit standard that may be used to deny an applicant is when the household does not meet the minimum FICO score of 620.

Once a household has been pre-approved by the Developer, the household will be sent to HouseKeys, Inc. for program eligibility screening. The Developer shall be clear with applicants that they must be screened for program eligibility before they are approved to move into an Affordable unit. Once the Developer has received confirmation of the household’s program eligibility, the tenants will be required to have an Orientation with the City or its Administrator to discuss restrictions related to living in Affordable Units.

All lease agreements must be reviewed and approved by the city before execution. The lease must include notification regarding a tenant’s annual compliance requirements and the prohibition on subleasing. Initial leases will have a term of one year but will revert to monthto-month at the initial lease’s expiration. A lease addendum prepared by the City must be attached to and made a part of the lease, and the tenant will also be required to sign a supplemental lease agreement noting certain conditions of living in an affordable unit.

If the Director of Community Development notifies the Developer/Management Company that the proposed lease is authorized and approved, the Developer/Management Company shall execute the lease of the Affordable Units within thirty (30) days after the date of lease approval by the City and shall send a copy of the fully executed lease to the City. However, the Director of Community Development may extend this time period at his/her discretion. Qualification Guidelines for Affordable Housing Program - City of Beverly Hills 11 determinations may be appealed by the Developer in accordance with the procedures described in Section 7.

Occupancy Standards
Throughout a household’s tenancy, the total number of household members in each unit shall remain within the standards listed below. The minimum occupancy shall apply only at the time of application, not ongoing tenancy, except that at least one resident remains in the home at all times.
• Studio – Minimum Household Size: 1, Maximum Household Size: 2 • One Bedroom – Minimum Household Size: 1, Maximum Household Size: 3 • Two Bedroom – Minimum Household Size: 2, Maximum Household Size: 5 Occupancy Priority
Applicants for Affordable Units will be screened by the Developer for initial eligibility based on the requirements outlined in Section 6.3. Qualified Households will then be ranked based on their level of priority, as described in the regulations in Beverly Hills Municipal Code (BHMC) §10-3-1528, as may be amended from time to time.

Displacement may also include voluntary vacation of a unit (such as accepting cash for keys payment to move out) in relation to a proposed development project on the site. It is also a valid reason for displacement if the unit vacated falls under the Ellis Act. To qualify, Applicants must provide proof of displacement, which would include a notice to vacate, an Ellis Act notice, or an agreement to accept cash for keys due to a proposed redevelopment on the site.

4.8 PERSONS INELIGIBLE TO OCCUPY AN AFFORDABLE UNIT
The following categories of persons shall be disqualified from occupying Affordable Units:
• All employees and officials of the City or its agencies, authorities, or commissions who have, by virtue of their position, policy-making authority or influence over the implementation of the Affordable Housing Program, as well as any relatives of employees of such City employees and officials, including but not limited to spouse, child, parent, grandparent, brother, sister, father-in-law, mother-in-law, son-in-law, daughter-in-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law. • Any relatives of the applicant or owner, including but not limited to spouse, child, parent, grandparent, brother, sister, father-in-law, mother-in-law, son-in-law, daughterin-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law. • Any individuals who are shareholders or members of the corporation or entity that participated in the development of the site where the affordable unit is located. • Any individuals who are convicted of a felony or do not meet minimal criteria are subject to the results of a conducted background check.

Guidelines for Affordable Housing Program - City of Beverly Hills 12 4.9 ANNUAL REPORT AND MONITORING
The management entity for the development must provide the City with an annual report in June of each year. The annual report must include the following information:
• Total Household Income for the prior year for the occupant(s) of each Affordable Unit; • Number of people residing in each Affordable Unit;
• Monthly rents charged for the prior year and proposed to be charged for the coming year for each Affordable Unit; and
• Vacancy of Affordable Units during the prior year, including which unit(s) and for how long.

This report will be collected as part of the annual project-level review completed by HouseKeys, Inc. in June of each year. Upon request from HouseKeys, Inc., the Developer will provide the information above in the form version provided to them. In addition, the Developer will provide a sample lease agreement and rental application, as well as other project-specific documents.

The city may perform an annual site visit to monitor the records of all Affordable Units. The city will provide at least two weeks’ notice to the Developer/Management Company as to the date of the site visit. Files for all Affordable Units must be made available for review at the request of the city. The purpose of the monitoring is to ensure compliance with these Guidelines, the city-approved Marketing Plan, and affordable housing requirements applicable to the Project.

The City will require tenant income verification and restriction of the Affordable Units for at least 55 years; however, the Developer/Management Company may send to the City copies of the documentation that is required and produced for other monitoring agencies.

Annual Tenant Recertification of Income
Each year, the City of Beverly Hills will require an income and occupancy certification for all Affordable Units. Management will provide an annual survey to the tenants of each Affordable Unit on or around June of each year. Each household must complete and return the survey to management along with qualifying documentation. Applicants who have recently occupied their unit within the last six (6) months will not be screened for continued eligibility until the following year. The annual tenant recertification of income will be performed by HouseKeys, Inc. and facilitated/reviewed by the city as needed. HouseKeys, Inc. will determine the tenant’s continued compliance with the City’s program and confirm the rental rate is in line with City standards.

If a household’s income rises more than 15 percent above the income limit for their unit, they will no longer be considered qualified for an Affordable Unit, and it will be the Developer’s responsibility to ensure that an Eligible Tenant is occupying the unit. When there is a finding of ineligibility, the Developer will have up to twelve (12) months to ensure that the Affordable Unit is occupied by an Eligible Tenant after complying with the applicable process for tenant Guidelines for Affordable Housing Program - City of Beverly Hills 13 selection as directed by the Administrator and the City. In a project where a mix of affordable income units are provided, and where a household’s income increases from one income category to the next (such as from a very-low to a low-income household), the household may continue to occupy the unit. However, it will be the Developer’s responsibility to ensure that the next vacancy of an affordable housing unit is a very-low income household to maintain the required number of affordable income units as originally approved in the project entitlements.

For tenants that have a decrease in income, they will not need to vacate the unit so long as they can still pay the rent.

If a Residential Development is financed through a government program that has stricter occupancy selection or documentation requirements than the city, the city may elect to rely on those requirements and associated documentation and not require additional documentation.

Guidelines for Affordable Housing Program - City of Beverly Hills 14 6. GUIDELINES FOR APPLICANTS – RENTAL UNITS
The purpose of Chapter 6 is to inform Applicants about affordable rental housing procedures in the City of Beverly Hills. Potential tenants will find information about the application process, required documentation, household size assumptions, income and asset calculation, and rental rates.

6.1 PROCESS FOR RENTING AN AFFORDABLE UNIT FOR APPLICANTS Residential Developments containing Affordable Units are produced as a result of the state or local legislation (including, but not limited to, Senate Bill No. 330., Senate Bill No. 8, the City’s Inclusionary Housing Ordinance, and state Density Bonus Law), or as a result of other agreements to provide Affordable Units as part of a development project in the City, shall comply with these Guidelines. Therefore, Affordable Units are priced reasonably for households that are at or below certain designated income levels. Pursuant to Government Code Section 66300 et seq., and State Density Bonus Law, replacement affordable units in a new housing development reserved for lower-income households (very low and low income) must be offered to tenants from the previously existing multi-family residential development.

If an affordable unit is being filled by a previous tenant of the previously existing multi-family development, then the Occupancy Priority list outlined in these guidelines is overridden per state law requirements. If a previous tenant does not wish to exercise their first right of refusal for an affordable unit, then the Occupancy Priority list in these guidelines shall apply.

The City of Beverly Hills has contracted HouseKeys, Inc. (“Administrator”) as its program administrator for the City’s Inclusionary Housing Program. As units become available, they will be marketed at www.HouseKeys20.com. Applicants interested in the City’s Inclusionary Housing Program shall register for an Application ID at www.myhousekeys.com to receive emails regarding upcoming opportunities, drawing entry deadlines, and instructions to apply.

Applicants who do not maintain an email address may request a reasonable accommodation and appropriate accommodations will be provided. Please note, only one application per household and development is allowed. Multiple applications for one development will disqualify the applicant and/or the household from the Opportunity Drawing process. In addition, vacancies will be posted at www.beverlyhills.org/affordablehousing.

When an Affordable Rental Unit, or “Opportunity,” becomes available, HouseKeys, Inc. will create an Opportunity Drawing, such as a lottery that will result in a Final Rank List. This Final Rank List is only applied to the project referenced at the time of application submittal; the list does not apply to multiple units. Interested applicants with an Application ID for the Program will be notified of the drawing by email. Each Opportunity will be assigned an Opportunity Guidelines for Affordable Housing Program - City of Beverly Hills 15 Drawing (OD) Index Number. This number will be used to track the Opportunity. Applicants must enter the drawing by the Entry Deadline to be considered for the Initial Ranking. Once the Drawing deadline has passed, HouseKeys, Inc. will rank the applicants who’ve entered the drawing using a lottery system. The lottery system creates a randomized number that is assigned to each applicant who has entered the Drawing before the Drawing Deadline. After the applicants are randomized, the applicable City Occupancy Priority List will be added, and the applicants will be re-sorted. Applicants who meet stated preferences in Section 6.6 of this guide will be processed first.

Potential applicants are encouraged to review the information in this document to determine whether they meet the qualifications to be considered for an Affordable Unit and to begin to collect relevant documents in order that they may be prepared to complete an application when units become available. In order to have an application that is considered complete, there are a number of supporting documents that are required. Any applicants presenting forged documents shall be disqualified from consideration.

When an Opportunity becomes available, HouseKeys, Inc. will prepare and distribute an Opportunity Drawing Notification. The Notification will be sent to all interested applicants with an Application ID and posted online on the project’s profile page. The new Opportunity will be posted in the Program Center of www.myHouseKeys.com, identified by its Opportunity Drawing Index Number. It is the Applicant’s responsibility to follow all instructions in the Opportunity Drawing Notification, including adhering to all deadlines. The Notification will include the file submission instructions and all deadlines that applicants must meet.

Once the applicant reviews the Opportunity Drawing information and is sure that they meet all listed requirements, the applicant shall follow all instructions on the Opportunity Drawing Notification. Applicants can only apply for one Opportunity Drawing in each Program. If they want to apply for a different drawing, they must opt out of the original drawing first before entering the next drawing on www.myHouseKeys.com. If it is discovered that an applicant has entered more than one drawing in a Program, they will be asked to select only one drawing and opt out of all others. Applicants who enter the drawing after the Entry Deadline will be considered back-ups and will be ranked by the entry’s date and time.

Once an Applicant has entered an Opportunity Drawing, they will be provided with a File Submission Deadline. The applicant must adhere to this deadline and upload their completed Application Documents into their www.myHouseKeys.com File Cabinet before the deadline listed. Applicants who do not upload their Application by the File Submission Deadline will lose their initial ranking and will be processed after applicants who submit documents timely.

Questions about applying for opportunities, registering for www.myHouseKeys.com, or the drawing process, shall be directed to [email protected]. Please note, multiple application submittals will not be allowed, and only one household composition will be allowed per applicant.

Once the Opportunity Drawing deadline has passed, HouseKeys, Inc. will complete the following steps:

Guidelines for Affordable Housing Program - City of Beverly Hills 16 • On the day of the lottery, all Applicants who entered before the Entry Deadline will be included in the Initial Ranking.
• All Applicants included in the Drawing will be sorted randomly using a randomizer. • The City Occupancy Priority List will then be applied to all Applicants included in the Drawing who meet City Occupancy Priority List.
• The Ranked List will be re-sorted to place Applicants with City Occupancy Priority List on the top of the List.

Once the Lottery is held, and the Final Ranked List is prepared, HouseKeys, Inc. will post the Final Ranked List on the project’s profile on www.HouseKeys20.com and the Applicants will be notified of their ranking. The Final Ranked List is only applicable to the referenced project listed at the time of application submittal. Applicants will be listed using their Application IDs. The Final Ranked List will be valid only for the subject development and will be utilized as the waitlist for if and when a unit is vacated in the future. Applicants must submit their completed application no later than the File Submission Deadline indicated on the Opportunity Drawing Notification. Applications received after the File Submission Deadline will void the initial ranking and will be processed after applicants who submitted their applications promptly.

Once the City has chosen tenants for the Affordable Units, the tenants will be required to have an Orientation with the City or its Administrator to discuss restrictions related to living in Affordable Units. Please note that if you are chosen to occupy an Affordable Unit, you will be required to present financial documents annually to the City to determine if you remain eligible to occupy the unit.

6.2 APPLICATION REQUIREMENTS
The completed application must include the name and address of the prospective tenant as well as the number of persons comprising their household and their names and ages. All requested income and asset documentation outlined in the application must also be submitted to determine the Total Household Income. A description of Gross Income follows in Section

6.4. In a circumstance where the applicant does not have an email address, pursuant to reasonable accommodations, Housekeys, Inc. may provide an email address for the applicant.

Household Composition
All residents who intend to reside in the home full-time will be included as household members. Regarding temporary living situations, including custody arrangements, the person would be counted towards the household and must provide copies of any custody agreements or court orders.

6.3 DESCRIPTION OF QUALIFICATION REQUIREMENTS
A household is qualified to rent an Affordable Unit if it satisfies the requirements shown in Table

6.3. Guidelines for Affordable Housing Program - City of Beverly Hills 17 TABLE 6.3

RENTAL AFFORDABLE UNIT HOUSEHOLD QUALIFICATIONS
Qualification Requirement Description
Income The household’s Total Household Income must not exceed the applicable Maximum Income outlined in Section 6.4.

Occupancy
The household must occupy the unit as its Principal
Residence within 30 days of executing the lease and shall occupy the unit continuously during the household’s leasing of the unit.

Real Property Interest (not
allowed)
No member of the Qualified Household must own any
interest in any real property, including but not limited to, any dwelling unit, commercial real estate, or land.

Execution of Lease
The Developer must execute the lease for the unit within 30 days of eligibility approval of an applicant by the City. The names of all non-dependent household members must
appear on the lease for the Affordable Unit.

6.4 HOUSEHOLD INCOME
To be eligible for an Affordable Unit, the applicant’s Total Household Income must not exceed the applicable Maximum Income adjusted for household size. Total Household Income means the household’s Gross Income plus any income derived from asset balances. Maximum Income is determined per county annually by HCD based on Area Median Income ( Gross Household Income
Gross Household Income means all income from all adult household members (18 years of age and older) derived from all sources as provided in the Internal Revenue Code (Title 26, Subtitle A, Chapter 1, Subchapter B, Part I, Section 61), whether or not such income is exempt from federal income tax. Such income includes, but is not limited to, the following:
• Compensation received from an employer;
o Compensation includes, but is not limited to, salary, overtime pay, and other pay o Other pay can include, but is not limited to, compensation for special working conditions or one-time payout of unused vacation and sick leave • Alimony or spousal and child support;
• Recurring cash payments;
• Public benefits including, but not limited to, CalWorks, SSI, unemployment benefits, and disability income;
• All interest, dividends, and royalties;
Guidelines for Affordable Housing Program - City of Beverly Hills 18 • Income derived from private businesses;
• Rental income;
• Income from pensions;
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and bonuses;
• Stipends received for participation in a mentor, learning, or education opportunity; • Gains from dealings in private and/or commercial property; • Gambling winnings;
• Annuities, life insurance, and endowment contracts;
• Income from discharge of indebtedness;
• Gross partnership contributions or distributions;
• Income from an interest in an estate or trust; and
• Regular gifts of support from family members if they have been received within six months of the application date, if not paid in cash
Exceptions
Gross Household Income does not include income earned by a household member who is between the ages of 18 and 26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member’s federal income taxes; and
• Is a full-time student (12+ units; school transcript must be provided).

Gross Household Income does not include payments to a household member from a governmental fund if all the following requirements are satisfied:
• The payments are based on the recipient’s or the recipient family’s financial need; • The payments do not represent compensation for services rendered; and • The payments are part of a governmental housing subsidy program including, but not limited to, so-called Section 8 federal housing assistance payments.

Although Section 8 vouchers do not count towards income, the tenant will still need to qualify at the time of application for the unit based on their income. Any relocation payments will also not count toward Total Household income but will count towards the overall asset calculation if it is in their accounts at the time of application.

For purposes of determining Gross Household Income, each person 18 years of age or older must present the following:
• A complete set of federal and state income tax returns and/or tax transcripts for the past two years, including all schedules (signed and dated), 1099 Forms, and W-2 forms. In the case where taxes have not been filed for any of the past two years, a letter of verification of non-filing from the Internal Revenue Service is required. In the event that tax returns Guidelines for Affordable Housing Program - City of Beverly Hills 19 are not available, tax transcripts are acceptable. (See https://www.irs.gov/individuals/get-transcript.)
• Written evidence of monetary gifts received, if applicable, if such gifts have been received at least six (6) months prior to application time, and are not cash gifts; • Four (4) most recent and consecutive pay stubs, if applicable; • Twelve (12) Month History of Child Support Payments or Proof of no Support, if applicable;
• Three (3) recent and consecutive statements for all financial accounts, including, but not limited to, savings accounts, checking accounts, retirement accounts, 401(k) accounts, stock accounts, and other accounts held in the applicant(s) name(s), whether held individually or together. Self-employed individuals must provide the six (6) most recent and consecutive statements for all financial accounts.

If a household member is self-employed, in addition to the information above, the member must submit profit and loss statements for the past three (3) years (if applicable), and a certified Year-to-Date profit and loss statement from January to the current month. Businesses shall not be lumped together; each needs its own Year-to-Date profit and loss statement.

The profit and loss statement must include this wording: “I/we certify under penalty of perjury that my/our YTD P&L is true and correct. I/we understand that HouseKeys, Inc. reserves the right to request an YTD P&L statement for any particular time frame certified/audited by a Licensed CPA at the applicant’s expense if needed.” This statement must be notarized with the Jurat Form attached.

The City may request additional financial statements or documentation in order to verify claims made in the application.

Income Calculation
The City’s housing consultant will calculate income based on the following methodology, and as documented in the income calculation worksheet utilized by the Administrator.

Wages and Salary. For employed applicants, annual income is generally derived by dividing the year-to-date gross income by the current pay period count and then annualizing over one year (12 months). Please note that a Verbal Written Verification of Employment may be required to be completed by the Employer issuing the pay statements.

If the applicant has recently changed positions with the employer, the Administrator will determine the effect of the change on the applicant’s eligibility and opportunity to receive a bonus or overtime pay in the future. If an applicant who has historically been employed on a part-time basis indicates that they will now be working full time (or vice versa), a written confirmation from the applicant’s employer may be required. A verbal verification of employment (VOE) may be required for each employer.

Guidelines for Affordable Housing Program - City of Beverly Hills 20 Tips, Overtime, Bonus, and other “variable income amounts” (amounts that change with each pay period) will be annualized separately from the base income outlined in the chart above. All income will be annualized and totaled unless the applicant can provide documentation from the employer. The employer must be available to complete a verbal verification of employment with the Administrator. In cases where the variable income item is a one-time occurrence, the amount will be removed from the annualized calculation of income and added to a one-time total to determine the annual income.

Example: An applicant earns $60,000 per year based on base monthly pay statements of $5,000 ($5,000 x 12). In addition to the base income shown, the applicant received a $2,500 one-time bonus in the year’s first quarter. If annualized, the $2,500 quarterly bonus would total $10,000 and the total income would be $70,000 ($60,000 base + $10,000 annualized bonus income). If proper documentation shows that the $2,500 is a one-time payment and the underwriter can verify and validate this information, the $2,500 would be added to the $60,000 base. The alternative total income would be $62,500 ($60,000 base + $2,500 one-time bonus).

The City may ask for additional financial records or verification from employers if income is unclear. In the case of unclear income or income that is somewhat difficult to calculate, please contact the city. The city will make the final determination as to which income calculation formula to use.

Variable Income. For applicants who are part-time employees or employees with variable hours every pay period (or variable hours less than 40 hours per week), inconsistent income or hours, frequent overtime, bonuses, and commissions, etc., their annual salary will be calculated using year-to-date income, plus the previous year’s income (from same income source or employer), divided by the number of months reviewed (up to but not exceeding 12 months) times 12 to arrive at their annual income. If there is no previous year income from the same employer, or the job was started mid-year, the current income year to date using the calculation explained above will be used.

Inconsistent or Temporary Change in Income Due to a Temporary Circumstance. If an applicant has a temporary situation that makes income calculation difficult, a Verification of Employment may be used to calculate the applicant’s income based on a normal annual period.

Alternatively, the income may be calculated based on the person’s hourly rate times their normal working hours.

Unemployed Applicants. Unemployed applicants receiving no income shall submit a ZeroIncome Affidavit in place of income statements. Applicants receiving unemployment benefits do not need to complete the Zero-Income Affidavit as unemployment benefits are considered income.

Self-Employed or Non-Corporation. A self-employed applicant is also considered to have variable income. All self-employed applicants must submit profit and loss statements for the past three years (if applicable) and a notarized Year-to-Date Profit and Loss Statement from January to the current month. If self-employed for two (2) or more years, the underwriter will Guidelines for Affordable Housing Program - City of Beverly Hills 21 use verifiable (verified using Form 4506-T) federal income tax returns and review the net income for as many as three (3) years of tax returns to determine the projected annual income.

If self-employed for less than two (2) years, the underwriter will review the submitted Profit & Loss Statement and use it to determine projected annual income. Additional documentation may be needed from the Self-Employed Household Member to determine projected annual income.

Assets
An asset test will be applied to all applicants to determine whether they satisfy the income requirements. The household’s Total Household Income will include assets in the calculation.

The asset calculation will only consider 10% of all assets, pursuant to California Code Regulations, Title 25, Chapter 6.5 Program operations, Gross Income (§ 6914).

Assets include, but are not limited to, cash, all savings and checking accounts, stocks, bonds, real property, gifts, and other sources of money. Other sources of money including PayPal, Venmo, and other electronic usage of banking will be considered and evaluated. Pensions and federally approved retirement savings accounts, such as IRAs, Roth IRAs, and 401(k)s, are excluded; however, retired applicants who collect income from their retirement account must these amounts as Gross Household Income on their application.

6.5 CREDIT SCORE
For rental Affordable Units, a credit check will be conducted on all adults (other than dependents) in the household. The Developer may charge a credit check and background screening report fee to the tenant, which may not exceed the actual cost of conducting such reports. Potential landlords and their agents are prohibited from requiring or accepting any form of deposit or other inducement to hold a unit for a prospective tenant. Guarantors on behalf of prospective tenants will not be allowed.

Creditworthiness means that:
• All household individuals shall have a minimum of three years since Chapter 7 or Chapter 13 bankruptcy discharge date and/or foreclosure/short sale and evidence satisfactory to the City of reestablished credit is provided; and • All persons appearing on the lease shall have a minimum FICO credit rating of 620 points from a reporting agency that aggregates credit scores from all three credit agencies dated within the last 6 months. A Developer may not refuse the unit to a tenant if the individual meets the minimum FICO credit score.

Pursuant to SB 267, any applicant receiving a government rent subsidy is not subject to the use of standard financial or income assessments as part of the rental housing application process, including a credit check. The applicant may provide alternative evidence of financial responsibility and ability to pay, which includes, but is not limited to, the following:
government benefit payments, pay records, and bank statements, in instances in which there is a government rent subsidy.

Guidelines for Affordable Housing Program - City of Beverly Hills 22 6.6 OCCUPANCY PRIORITY
Once the application period has ended for the applicable Opportunity Drawing, applications will be categorized by Priority Level. A lottery system shall be used to numerically rank all applications within the Priority Level if there are multiple applications that fit into one level.

Applications will be reviewed to determine whether they are eligible, starting with the topranked application in priority level one and moving down the list. In the instance where no applicants are found eligible, the City will open a new Opportunity Drawing and the steps for Occupancy Priority will occur once more until an applicant is found eligible.

Applicants for Affordable Units will be screened by Housekeys, Inc. for initial eligibility based on the requirements outlined in Section 6.3. Qualified Households will then be ranked based on their level of priority, as described in the regulations in BHMC §10-3-1528.

6.7 PERSONS INELIGIBLE TO OCCUPY AN AFFORDABLE UNIT
The following categories of persons shall be disqualified from occupying Affordable Units:
• All employees and officials of the City or its agencies, authorities, or commissions who have, by virtue of their position, policy-making authority or influence over the implementation of the Affordable Housing Program, as well as any relatives of employees of such City employees and officials, including but not limited to: spouse, child, parent, grandparent, brother, sister, father-in-law, mother-in-law, son-in-law, daughter-in-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law. • Any relatives of the applicant or owner, including but not limited to spouse, child, parent, grandparent, brother, sister, father-in-law, mother-in-law, son-in-law, daughterin-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law. • Any individuals who are shareholders or members of the corporation or entity that participated in the development of the site where the affordable unit is located. • Any individuals who are convicted of a felony or do not meet minimal criteria are subject to the results of a conducted background check.

6.8 TENANT OBLIGATIONS
Once the City has chosen tenants for the Affordable Units, the tenants will be required to attend an Orientation with the City or its Administrator to discuss restrictions and obligations related to living in Affordable Units. The household must execute the lease for the unit within 30 days of approval. The names of all non-dependent household members must appear on the lease for the Affordable Unit.

Guidelines for Affordable Housing Program - City of Beverly Hills 23 Annual Tenant Recertification of Income
Each year, the City of Beverly Hills will require an income and occupancy certification for all Affordable Units. Management will provide an annual survey to the tenants of each Affordable Unit on or around June of each year. Each household must complete and return the survey to management along with qualifying documentation. Applicants who have recently occupied their unit within the last six (6) months will not be screened for continued eligibility until the following year. The annual tenant recertification of income will be performed by HouseKeys, Inc., Inc. and facilitated/reviewed by the city as needed. HouseKeys, Inc. will determine the tenant’s continued compliance with the City’s program and confirm the rental rate is in line with City standards.

If a household’s income rises more than 15 percent above the income limit for their unit, they will no longer be considered qualified for an Affordable Unit, and it will be the Developer’s responsibility to ensure that an Eligible Tenant is occupying the unit. In a project where a mix of affordable income units are provided, and where a household’s income increases from one income category to the next (such as from a very-low to a low-income household), the household may continue to occupy the unit. However, it will be the Developer’s responsibility to ensure that the next vacancy of an affordable housing unit is a very-low income household to maintain the required number of affordable income units as originally approved in the project entitlements. For tenants that have a decrease in income, they will not need to vacate the unit so long as they can still pay the rent.

Non-compliance Event
A non-compliance event shall be defined as an event where the Affordable Unit or actions taken by the Developer or tenant are no longer in compliance with the requirements outlined in the Affordable Housing Guidelines, Affordable Housing Agreement, or project conditions of approval. This shall include, but is not limited to, the following: 1) Existing tenant does not meet income thresholds during the annual tenant recertification period; and 2) Affordable Unit is not occupied by an eligible tenant. If the City determines a non-compliance event has occurred, the Developer shall provide a remedy plan detailing the action(s) they will take to cure the noncompliance event to the City within one week of the City notifying the Developer of the noncompliance event. The City shall review and determine if such remedy plan is sufficient and may request revisions to the remedy plan to ensure the plan is appropriately addressing the non-compliance event. The City reserves all rights to seek a remedy for any non-compliance event.

Guidelines for Affordable Housing Program - City of Beverly Hills 24 7. EXCEPTIONS AND APPEALS

7.1 EXCEPTION REQUESTS
Any applicant believing that his/her situation warrants an exception to any part of these Guidelines due to circumstances outside of his/her household’s control, such as refugee status, special needs, or other hardships or special circumstances, may request an exception by submitting a written letter to the city prior to submitting an application of any kind.

The exception request must specify which particular guideline or requirement the household cannot meet for reasons beyond their control or other valid reasons, and/or describe the household’s unique circumstances that warrant one or more specific exceptions to be identified in the letter, referencing the page(s) and section(s) of these Guidelines and/or application form related to the request.

If the need for an exception arises while an application is being reviewed, a request may be submitted at such time. If the need for an exception arises only after receipt of a determination letter issued by City staff, an exception request shall be submitted as an appeal of such determination.

Exceptions related to disabilities (reasonable accommodations) may be requested according to this procedure, with a brief description of the exception(s) needed due to the applicant’s disability. Such requests will be handled in accordance with the City’s reasonable accommodations policy and these Guidelines.

The city will consider the requested exception and will provide a letter response within 10 calendar days, stating whether the requested exception can be granted in full or part and the reason for such decision.

7.2 APPEALS PROCEDURE
Each Opportunity Drawing Notification will outline an Appeal Procedure.

Applicants and Developers may appeal any determination letter, including denial of a requested exception, by providing a written explanation of the reasons for their appeal, and any supporting evidence they wish to provide. If the Applicant/Developer wishes to the appeal the determination of the Administrator, an appeal letter must be delivered by mail, e-mail, or personal delivery within 10 calendar days of issuance of the determination letter being appealed to the Director of Community Development.

Applicants/Developers will be directed to complete an Appeal Form (online or using a downloaded form) indicating that they would like to appeal a decision issued by the Administrator or the Developer. Applicants will be given 3 business days following a timely appeal submittal to submit any and all documents they wish to be considered as part of the appeal. Administrator and/or City will review the appeal within 15 business days. The Director of Community Development will review the appeal and make a determination within 15 Guidelines for Affordable Housing Program - City of Beverly Hills 25 calendar days. If denied, the Applicant/Developer may submit a request for arbitration.

Determinations by the use of an arbitrator shall be final.

Unless the appellant opened escrow to purchase an Affordable Unit prior to the timely submittal of an appeal letter, no Affordable Unit will be held or reserved for the applicant/appellant while an appeal is being considered and offers from other perspective buyers may be accepted by the seller(s) of Affordable Unit(s) during this time. If the appellant is in escrow to purchase an Affordable Unit, the City shall not issue any escrow instructions until a final determination regarding the appeal has been made, other than to inform the escrow officer that he/she may not close until further written notice from the City.

The City is not responsible for any actions of seller, lender, or other parties regarding the escrow during the appeal period which may jeopardize buyer’s ability to purchase, or sellers’ ability to sell, the Affordable Unit.

City staff is not authorized to assist applicants in drafting appeal letters, nor to provide advice in determining appropriate grounds for appeal or appropriate forms of supporting evidence, beyond advising them of the contents of these Guidelines, application forms, and other published program materials. Applicants may refer to these Guidelines and application forms and/or seek their own advisors/counsel for guidance in determining what types of documentation would be reasonable.

Guidelines for Affordable Housing Program - City of Beverly Hills 26 8. APPENDICES
APPENDIX A – ONBOARDING CHECKLIST
New Project Marketing Checklist
This Checklist must be completed and submitted before your Drawings are scheduled.

Property Name:

Property Address:

Property Phone:

Agency/Jurisdiction:

APN
Program Type: Check all that apply:
___ Low-Income Housing Tax Credit (LIHTC/Section 42)
___ Inclusionary/Zoning
___ Density Bonus
___ Redevelopment
___ HOME/PBV/Other Federal Program
___ Other: _____________________________________
Does this Project have
an Senior Restriction? YES NO
If yes, please answer the following questions:

What is the Age Requirement?
Does the Age Requirement apply to all
restricted units?
YES NO
Does the Age Requirement apply to all
household members?
YES NO

Owner/Agent Information
Property Developer Name:

Name Title Phone Number Email Address
Property Owner Name:

Name Title Phone Number Email Address
Management Agent Name:

Name Title Phone Number Email Address
Guidelines for Affordable Housing Program - City of Beverly Hills 27 Unit Mix and Selection
Total Units: Total Restricted Units:

Complete thisInformation for Restricted Units
Unit Type Unit Count Income Level Rent Level
(may differ from Income)
Does Exhibit B on the Affordable Agreement
designate the Unit Numbers for your restricted
units?
YES NO
Does the Unit Delivery Sheet match the Unit
Numbers approved by the city?
YES NO
If not, have you sought City approval for the
Unit Numbers on the Unit Delivery Sheet?
YES NO - Explain:

Lease Charges and Deposits
Application Fee: Security Deposit: Pet Deposit:

In addition to rent, what other fees or charges will the residents be required to pay:

Parking Fees Optional Non-Optional Monthly Fee:

Renters’ Insurance Optional Non-Optional Monthly Fee:

Pet Rent Optional Non-Optional Monthly Fee:

Garage Fees Optional Non-Optional Monthly Fee:

Other: Optional Non-Optional Monthly Fee:

Guidelines for Affordable Housing Program - City of Beverly Hills 28 Utility Schedule
What utilities are
paid by the
RESIDENT?
Check all that apply:

Gas
What utilities are paid by the
OWNER? Check all that apply:

Gas
Electric Electric
Water Water
Sewer Sewer
Trash Trash
Other: Other:

Does the Affordable Agreement identify a requirement to allow a Utility Allowance? YES NO
If yes, please explain the Utility Source: (e.g., PHA, CUAC, HUD) Please select the Unit Type: Semi-Detached, Rowhouse, Townhouse Low-Rise and High-Rise
Single Family Detached, Manufactured Home
Heating Source: Natural Gas
LPG/Propane
Electric
Utility Provider:

Cooking Source: Natural Gas
LPG/Propane
Electric
Utility Provider:

Water Heating Source: Natural Gas
LPG/Propane
Electric
Utility Provider:

Do residents provide their own appliances? Range/Microwave YES NO Refrigerator YES NO
Do the residents pay a Radio Billing Utility
System (RUBS) Fee?
YES NO

If yes, what is the monthly
amount paid?
What does the RUBS
Fee include?
Gas
Electric
Water
Sewer
Trash
Guidelines for Affordable Housing Program - City of Beverly Hills 29 Marketing and Opportunity Drawing Set-up
What are the Leasing Office Hours?
Does the Project intend to have an Open
House?
YES NO If yes, when:

Does the Project accept Guarantors? YES NO
If yes, please explain the requirements:

Does the project have a Minimum Income
Requirement? (e.g., 2 times rent) YES NO If yes, explain:

How many parking spaces
are provided per unit?
Is Guest parking
available?
YES NO

If yes, how many spots may a resident use?
Does the project have an
Elevator?
YES NO
Who is completing the
Underwriting? HouseKeys
Owner/Developer
Property Management Company
Other:

Property Website
Please describe the
Property’s Amenities
Washer/Dryers Washer/Dryer in
unit Hook-up in unit
Common Area Laundry Room
Other:

What Marketing Sources is
the project currently
using/intends to use?
Print Media (e.g., Newspapers, Magazine) Source:

Online (e.g.. Craigslist, Apartments.com) Source:

Radio/TV Media Source:

Local Organizations Source:

Flyers, Brochures
Property Signage
Guidelines for Affordable Housing Program - City of Beverly Hills 30 APPENDIX B – MARKETING MILESTONES SAMPLE
0 1 2 3 4 5 6
Project
Onboarding
Launch of
Marketing
Campaign
Deadline
to Enter
Drawing
(Lottery)
Rank,
Confirm
Results
and
Deliver
Ranked
List to
Site
Team
Site Team to
Complete
Tenant
Screening
Administrator
to Complete
Eligibility
Review &
Certification
Eligible Tenant
to Sign Lease
Developer
Deadline for
documents
is typically
within a
certain
number of
days after
the
Effective
Date of the
Housing
Agreement
or Required
before
Permits are
Pulled
At least 30
Days prior
to
Deadline
Provide
applicants
at least 2
weekends
to review
materials
and attend
orientation
sessions
Deliver
Ranked
List to
the Site
Team
This
process
typically
takes 5
to 7
business
days
Site Team
should have a
deadline to
deliver tenant
certifications
so that
Administrator
can complete
Eligibility
Screening
Screening
should be
good for
enough days
to account for
construction
delays
Eligibility
Screening is
based on file
volume and
this process is
typically 60
days from
when
Administrator
receives
Tenant
Screening
Eligibility
Certification
typically
good for 180
days
Within a certain
number of days
of Eligibility
Certification or
Occupancy
Clearance

Attachment 3
Planning Commission
Resolution No. 2068
1 RESOLUTION NO. 2068

A RESOLUTION OF THE PLANNING COMMISSION OF THE

CITY OF BEVERLY HILLS RECOMMENDING ADOPTION OF

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT (CEQA)
WHEREAS, the Planning Commission has considered the proposed Amendment to the City of Beverly Hills Municipal Code, as set forth and attached hereto as Exhibit A (the “Amendments”); and
WHEREAS, the Planning Commission conducted a duly noticed public hearing on September 12, 2024, at which times it received oral and documentary evidence relative to the proposed Amendments; and
WHEREAS, the Planning Commission finds that the proposed Amendments are required because of the benefit to the public interest, health, safety, morals, peace, comfort, convenience, or general welfare, and that such Amendments are consistent with the general objectives, principles, and standards of the General Plan.

NOW, THEREFORE, the Planning Commission of the City of Beverly Hills hereby finds, resolves, and determines as follows:

Section 1. The Amendments have been environmentally reviewed pursuant to the provisions of the California Environmental Quality Act (Public Resources Code Sections 21000, et seq.(“CEQA”), the State CEQA Guidelines (California Code of Regulations, Title 14, Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 2 Sections 15000, et seq.), and the City’s Local CEQA Guidelines (hereafter the “Guidelines”). The Planning Commission finds that the Amendments are exempt from CEQA pursuant to Section 15061(b)(3) of the State CEQA Guidelines, which applies the 'general rule' that CEQA does not extend to projects with no significant environmental effect. As such, there is no possibility that the Amendments would result in a significant effect on the environment because the modifications do not enable any physical changes to the environment, directly or indirectly.

Section 2. The Amendments are consistent with the objectives, principles, and standards of the following General Plan and Housing Element Goals and Policies:
• H2 Housing Supply and Diversity. Provide a variety of housing types and adequate affordable housing supply
• H 2.2 Inclusionary Housing. Continue to implement an inclusionary housing program to integrate affordable units within market rate developments, and increase the availability of affordable housing throughout the community. (Imp. 10.2) • H 2.9 Jobs-Housing Balance. Promote programs seeking to provide housing opportunities for people who work in the City as a means of reducing long commutes, easing local traffic, improving air quality and helping to achieve a balanced regional jobs-housing distribution for the western portion of Los Angeles County. (Imp. 10.6) • H 2.10 Workforce Housing. Study and develop programs to increase the amount of rental and ownership housing affordable to the local workforce. (Imp. 10.3, 10.4) Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 3 • H 3 Fair Housing and Special Needs Residents. Promote equal housing opportunities for all residents; including Beverly Hills’ special needs populations, so residents have a choice of appropriate housing.
• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and non-discrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 3. The Planning Commission does hereby recommend to the City Council the adoption of an ordinance approving and enacting the proposed Amendments substantially as set forth in Exhibit A, which is attached hereto and incorporated herein by reference.
//
//
//
//
//
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Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 4 Section 4. The Secretary of the Planning Commission shall certify to the passage, approval, and adoption of this resolution, and shall cause this resolution and his/her Certification to be entered in the Book of Resolutions of the Planning Commission of the City.

Adopted: September 12, 2024
Theresa M. Kaplan
Chair of the Planning Commission of the
City of Beverly Hills
Attest:

Masa Alkire, AICP
Secretary of the Planning Commission
Approved as to form: Approved as to content:

David M. Snow Masa Alkire, AICP
Assistant City Attorney Assistant Director / City Planner Community Development Department
EXHIBIT A: Draft Ordinance
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 5 EXHIBIT A
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -1-
[DRAFT] ORDINANCE NO. 24-O-_______

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT (CEQA)
WHEREAS, the City of Beverly Hills (“City”) desires to amend regulations in the Beverly Hills Municipal Code (“BHMC”) regarding priorities utilized to establish the order in which income restricted housing units will be offered to qualifying households, and include a definition of displacement from existing housing;
WHEREAS, on September 12, 2024, the Planning Commission held a duly noticed public hearing and at which time it adopted Resolution No. 2068 recommending that the City Council amend Article 15.2 (Residential Density Bonus) and Article 48 (Inclusionary Housing Requirements for Residential Development) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC addressing priority standards to be utilized to establish the order in which income restricted housing units will be offered to qualifying households, taking into account state law requirements, reducing the number of occupancy priority tiers, include a tier prioritizing individuals who work in the city; and to add a definition of displacement and provide a consistent time limit for Tier 2 which households are considered displaced (collectively, the “Amendments”); and
WHEREAS, The City Council considered the Ordinance on October 10, 2024, at a duly noticed public hearing, as prescribed by law, at which time City staff presented the matter, and Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -2-
interested persons had an opportunity to and did testify either in support or against the ordinance.

Following the public hearing, the City Council considered the entire record of information received at the public hearing before the City Council.

THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -3-
• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and nondiscrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 2. Section 10-3-1528 (Occupancy Priority) of Article 15.2 (Residential Density Bonus) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC is hereby amended in its entirety to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

2. Tier 2 - Households displaced from a property within the City of Beverly Hills in the past ten years in the following order:
i. Senior households (62 years and older)
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -4-
ii. Households with student(s) in 10th grade or lower enrolled in the Beverly Hills Unified School District
iii. Other displaced households

3. Tier 3 - Senior Households (62 years and older).

5. For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property;
b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer);
c. Withdrawal of the housing unit from the rental housing market under the Ellis Act;
d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -5-
e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis as deemed by the City, including but not limited to, when occupancy is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed substandard or uninhabitable.

6. Exceptions:

Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -6-
B. Notwithstanding subsection A, inclusionary units shall not be required for any project for which the city enters into a development agreement or for any project that is otherwise exempt under state law.

C. All inclusionary units shall be subject to the occupancy standards set forth in BHMC §10-3-1528.

Section 6. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the City within fifteen (15) days after its passage in accordance with Section 36933 of the Government Code, shall certify Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -7-
to the adoption of this Ordinance, and shall cause this Ordinance and his certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City. ///
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 -8-
Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (31st) day after its passage.

Adopted:

Effective:
____________________________

LESTER FRIEDMAN
Mayor of the City of Beverly Hills,
California
ATTEST:
_________________________ (SEAL)

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS.

CITY OF BEVERLY HILLS )
I, KAREN MYRON, Recording Secretary of the Planning Commission of the City of Beverly Hills, California, do hereby certify that the foregoing is a true and correct copy of Resolution No. 2068 duly passed, approved and adopted by the Planning Commission of said City at a meeting of said Commission on September 12, 2024, and thereafter duly signed by the Secretary of the Planning Commission, as indicated; and that the Planning Commission of the City consists of five (5) members and said Resolution was passed by the following vote of said Commission, to wit:

AYES: Commissioners Milkowski, Ross, Vice Chair Wolfe, Chair Kaplan NOES: None
ABSTAIN: None
ABSENT: Commissioner Demeter
________________________________

KAREN MYRON
Recording Secretary of the
Planning Commission
City of Beverly Hills, California
Docusign Envelope ID: 888F5C77-902E-47EE-B41E-6655DA22A6B4 Attachment 4
September 12, 2024
Planning Commission Staff Report
City of Beverly Hills
Planning Division
455 N. Rexford Drive Beverly Hills, CA 90210
TEL. (310) 285-1141 FAX. (310) 858-5966
Planning Commission Report
Attachments:

A. Draft Resolution (Exhibit A: Draft Ordinance)
B. Redlined Ordinance
C. 2017 Planning Commission Staff Report – Revised Occupancy Priority D. 2019 City Council Staff Report – Revised Occupancy Priority E. BHMC §10-3-1528 – Occupancy Priority
F. July 11, 2024 Planning Commission Staff Report – Study Session G. BHMC § 4-5-513 – Withdrawal of Residential Rental Structure from the Rental Market
H. California Health and Safety Code Section 17980 and 17920.3 (Substandard Conditions)
I. BHMC § 9-1-108 – Submittal Documents (Means and Method Plan) J. 2022-2024 Uninhabitable/Red Tag Units
K. General Plan and Housing Element Goals and Policies
Report Author and Contact Information:

Christine Delostrinos, Associate Planner
(310) 285-1125
[email protected]
Meeting Date: September 12, 2024
Subject: AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO AMEND

THE BEVERLY HILLS MUNICIPAL CODE TO REVISE

OCCUPANCY PRIORITY STANDARDS FOR ELIGIBLE

AFFORDABLE HOUSING UNITS, ADD A DEFINITION OF

DISPLACEMENT, AND FINDING THE ORDINANCE TO BE

EXEMPT UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY

ACT (CEQA)
The Planning Commission will consider a draft ordinance to amend the City’s regulations for occupancy priority standards for eligible affordable housing units and to establish a definition of displacement applicable to the occupancy priority standards.

Location: Citywide
Project Applicant: City-Initiated
Recommendation: Conduct a public hearing and adopt a resolution recommending the adoption of the draft ordinance to the City Council; and finding the project exempt from further review under CEQA.

REPORT SUMMARY
This report discusses a draft ordinance amending the Beverly Hills Municipal Code (“BHMC”) to:
1) Revise the current occupancy priority standards for households eligible for affordable housing units that have been produced pursuant to the City’s inclusionary housing ordinance (Article 48 in Title 10, Chapter 3 (Zoning) of the BHMC), state Density Bonus law (Article 15.2 in Title 10, Chapter 3 (Zoning) of the BHMC), and state Housing Crisis Act of 2019 (“SB 8”, California Government Code Section 66300 et seq.). 2) Add a definition of displacement to the BHMC for the purposes of defining individuals and households eligible for potential future placement in affordable housing units.

Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

Page 2 of 11 ends

The proposed amendments will revise the occupancy priority standards based on direction provided by the Planning Commission by reorganizing the tiers, making this consistent with SB 8 requirements, and introducing an additional priority for individuals who work within the city.

Specifically, the ordinance will amend: 1) BHMC §10-3-1528 (Occupancy Priority) of Article 15.2 Residential Density Bonus in Title 10, Chapter 3 (Zoning) of the BHMC to include the revised occupancy priority standards and a definition for displacement; and 2) BHMC §10-3-4802 (Applicability) Article 48. Inclusionary Housing Requirements for Residential Development in Title 10 Chapter 3 (Zoning) of the BHMC to include occupancy standards by reference to the amended BHMC §10-3-1528.

The draft ordinance will be scheduled for City Council review and adoption after this review and recommendation by the Planning Commission.

BACKGROUND
In 2005, the City Council adopted local residential density bonus regulations consistent with the state Density Bonus law, which included occupancy priority standards for affordable housing units. The occupancy priority standards provide ranking criterion for income-qualified households seeking placement in affordable housing units In 2017, the Planning Commission reviewed and made recommendations for a revised occupancy priority standard to clarify and clean up application of the standard and to align the priorities with City goals of addressing the special housing needs of seniors and households displaced by site redevelopment (Attachment C).

In 2019, the City Council adopted the revised occupancy priority standards in the BHMC §10-3- 1528 (Attachment D), which are currently in effect. The amendment revised the code to ensure that households forced to vacate a building in the city due to redevelopment are considered eligible displaced households and given first priority for placement into newly developed affordable housing units on the site from which they were displaced. The revisions added two tiers to prioritize displaced families with students in the Beverly Hills Unified School District (“BHUSD”).

The revisions also clarified that displaced households shall be ranked within each priority level by the length of residency in the building from which the household is being/was displaced. The current BHMC occupancy priority standards are listed below in Table 1, and further detail on the list can be found in Attachment E.

TABLE 1. EXISTING OCCUPANCY PRIORITY

Page 3 of 11 ends

The occupancy priority standards guide the placement of qualified households into any deedrestricted affordable housing units constructed in the City, including units created per the City’s inclusionary housing ordinance, state density bonus law, and any affordable replacement units required under SB 8. After implementing the occupancy priority standards for the affordable housing placement process since 2019, staff has observed the following issues that support the proposed update:
• No qualified households for Tiers 1 through 6 - Tiers 1 through 6 are intended to prioritize households displaced from project sites, particularly those most vulnerable, such as seniors and families that are displaced from a project site within Beverly Hills. However, no applicants have qualified under these tiers, with applicants falling under either Tier 7 (Senior Households) and Tier 8 (Other Income-Qualified Households). • New state law priority to low-income households - Tiers 1, 2, and 3 are superseded by the implementation of state law requirements under SB 8. SB 8 entitles lower-income households of protected units to a right of first refusal (or the first right to return) regardless of household type.
• Clarification needed on the definition of displacement - Displacement is generally defined within each occupancy priority standard tier as “income-qualified households displaced from a multi-family building in the city that have or will be displaced or evicted from a multi-family building tied to a redevelopment site.” However, the definition currently varies slightly depending on the tier.
• Existing time limit provisions - Tiers 4, 5, and 6 include language that places a time limit on determining whether a household is considered an eligible displaced household.

These limits can affect eligibility for priority housing. • Public comments on occupancy priority standards - Staff received public comments expressing that the current occupancy priority standards are too limited in their definition of displacement. These parties have expressed a desire to prioritize Beverly Hills residents who have vacated their homes due to household damages or harmful conditions, to revise Tier 1 of the priority list to include seniors generally displaced from the City (not just seniors who are displaced from the specific project site), and to suggest an expansion of the definition of displacement to include periods exceeding two or five years.

Planning Commission Review
The Planning Commission previously reviewed updates to the City’s Affordable Housing Guidelines and the occupancy priority standards during a July 11, 2024 study session. During that study session, concerns regarding the current occupancy priority standards and lack of a definition of displacement were introduced. As part of this discussion, staff presented a survey of three cities to compare their priority lists and priority list application processes. The detailed comparative analysis is included in the attached July 11, 2024 staff report (Attachment F). The analysis in that report compares the City’s current priority list with those of similar jurisdictions.

The comparative analysis illustrated how cities may choose to prioritize specific populations based on housing needs and other cities have implemented a clear definition of displacement.

The Commission’s discussion concluded that revisions to the Affordable Housing Guidelines were appropriate, but that the occupancy priority standards need to be revised to comply with SB 8 Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

Page 4 of 11 ends

requirements relating to households of protected units exercising their “right to first refusal” and should also include priority for individuals who work in the city. Additionally, the Commissioners recommended a separate definition of displacement that can be enforced to clarify the City’s criteria for a displaced household. The commission’s comments include expanding the time limit in which displacement is considered, including households involuntarily vacating a unit due to uninhabitable living conditions and natural disasters, households voluntarily vacating a unit due to new development such as cash for keys, and households voluntarily vacating a unit due to the unit being withdrawn from the rental market under the Ellis Act. A summary of the Planning Commission’s comments and recommendations is outlined in Table 2.

TABLE 2. SUMMARY OF PLANNING COMMISSION
DIRECTION FROM JULY 11, 2024 STUDY SESSION

TOPIC PLANNING COMMISSION COMMENTS AND DIRECTION
Occupancy Priority Standards
• Further clarify standards
• Incorporate SB 8 requirements for “right of first refusal” • Prioritize
o households displaced from project site
o individuals who work in the city
o existing Beverly Hills residents
Displacement
• Provide a clear definition for displacement and means to verify it
• Include provisions for involuntary vacancy such as
substandard housing, natural disasters, Ellis Act
• Include voluntary vacancy such as “cash for keys”
• Reference City of Santa Monica and City of Pasadena
definition
• Increase timeframe for qualification as displaced

DISCUSSION
Based on the Planning Commission’s review and recommendations, staff prepared a revised occupancy priority standard that would be applied to the placement of a household into an affordable housing unit. Table 3 provides the staff recommended Tiers for a revised occupancy priority standard in the “PROPOSED” column. The “EXISTING” column is provided to allow comparison with the existing standard.

TABLE 3. REVISED OCCUPANCY PRIORITY STANDARD COMPARED WITH EXISITNG

TIER PROPOSED EXISTING
1 Existing occupants of protected units, as
defined in Government Code Section
66300.5(h) as it may be amended from
time to time, who are lower-income
households on a project site and who are
displaced by a new development on the
same site and are exercising a right of first
refusal for a comparable unit in the new
housing development, or in any required
Senior households displaced from project site
within BH (new project).

Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

Page 5 of 11 ends

replacement units associated with a new
development that is not a housing
development, pursuant to Government
Code Section 66300.6(b)(4)(B), as
amended from time to time.
2 Households displaced from a property
within the City of Beverly Hills in the past
ten years in the following order:
i. Senior households (62 years and
older)
ii. Households with student(s) in 10th
grade or lower enrolled in the
Beverly hills Unified School
District
iii. Other displaced households
Households with BHUSD students displaced from
project site (new project).
3 Senior households (62 years and older). Other households displaced from project site within BH (new project).
4 Individuals employed full-time by a
business located and operating in the City
of Beverly Hills, and whose primary work
location is located within the City of
Beverly Hills. For purposes of this section,
full-time employment is defined as a
minimum average of 130 hours of service
per calendar month over a six month
period.

Displaced senior households from MFR within BH.
5 - Displaced households from MFR within BH with
BHUSD students.
6 - Other Displaced households within BH.
7 - Senior households.
8 - Other income-qualified households.

The occupancy priority standards were reorganized and simplified, and revised to clarify compliance with SB 8 requirements, definition of displacement, and to add a priority tier for workforce housing.

Reorganization of Occupancy Priority Standards
The proposed revised occupancy priority standard reorganizes the priority tiers as follows:
• The Tier 1 priority will prioritize households who are directly displaced from the project site and are entitled to the right of first refusal, under SB 8, the highest priority. The tier references the government code section of SB 8, and mentions potential amendments to state law requirements.
• Tier 2 will prioritize households displaced within the City, as defined with the proposed definition of displacement.

Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

Page 6 of 11 ends

• Tier 3 will prioritize senior households that maintain an occupant 62 years and older, which addresses the City's special housing need to provide housing for the senior community. • Tier 4 will prioritize workforce housing, prioritizing individuals employed full-time by a business located and operating in the City of Beverly Hills. • Please note, there is no defined tier for “other income-qualified households” as the lottery system will rank these households after all households qualified and ranked under the occupancy standards. Therefore, in a circumstance where no households are qualified for the listed occupancy standards, other income-qualified households will be reviewed.

The reorganization of the occupancy priority standards provides more clarity and direction while addressing the commission's recommendation to clarify the standards further for better interpretation and application during the affordable housing placement process.

The proposed occupancy priority standards maintain specific criteria that do not allow a household to qualify for more than one tier. For example, the proposed Tier 1 allows for all income-qualified households directly displaced from the project site the highest priority independent of household type and where Tier 2 captures generally displaced individuals with sub-tiers as defined by the proposed definition of displacement. Therefore, a weighted tier system by ranking a household higher if the household qualifies for more than one tier is not appropriate as a household cannot qualify for more than one tier with the proposed occupancy priority standards.

Households Subject to SB 8 Priority
The current occupancy priority standard for Tiers 1, 2, and 3 prioritize households displaced from the project site depending on the household type, such as senior households, households with BHUSD students, and other qualified households. While these tiers provide a right to return for certain types of households displaced due to redevelopment of the site, SB 8 requirements entitle all lower-income households of protected units (such as a rent-stabilized unit) on the project site to a right to return regardless of the household type (such as senior household, etc.). Though SB 8 supersedes the City’s occupancy priority standard and is implemented this way in practice, Tiers 1, 2, and 3 could be interpreted as conflicting with SB 8 due to the Tiers’ specified displaced household type. During the study session, the Planning Commission recommended that the occupancy priority standards align with SB 8. Therefore, Tier 1 has been revised to be consistent with SB 8 requirements, prioritizing existing occupants of protected units on a project site who are displaced by the new development and are exercising the right of first refusal for a comparable unit in the new housing development, or in any required replacement units associated with a new development that is not a housing development.

Workforce Housing Priority
The Planning Commission also provided direction at the July 11 study session that the occupancy priority standards should prioritize individuals who work within the city. Therefore, the ordinance proposes that Tier 4 prioritize individuals employed full-time by a business located and operating in the City. Full-time employment will be determined by a minimum average of 130 hours of service per calendar month over a six-month period. This recommendation is based on the following factors:

Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

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• The Housing Element includes a goal to provide a variety of housing types and access to affordable housing to meet the existing and future needs of the community, which consists of the policy to support workforce housing (H 2.10).
• The Internal Revenue Service (“IRS”) defines a full-time employee as an individual who averages at least 30 hours of service per week, or 130 hours of service per a calendar month1
.
• Understanding the varying service hours of hospitality, restaurant, retail, and servicerelated industries, which primarily make up the commercial activities in the Business Triangle, full-time employment will be determined by an average calculation over a period of six months.
• The criteria aims to ensure that the individual is not remotely working within the city while the business location and operation is outside of the city boundary; therefore, individuals must provide proof of the employer’s business location and operation within the city boundary.

Defining Displacement
Currently, the qualifying criteria for a displaced household or individual is set forth in various occupancy priority standard tiers and is not consistent throughout the tiers. Generally, these definitions define “displacement” as “income-qualified households displaced from a multi-family building in the city that have or will be displaced or evicted from a multi-family building tied to a redevelopment site.” The existing language in Tiers 4, 5, and 6 place a time limit on whether a household is considered eligible as a displaced household, whereas Tiers 1, 2, and 3 do not have a time limit. Table 4 outlines the existing displacement time limit provisions placed in Tiers 4, 5, and 6 dependent of whether the project site maintains an active entitlement, demolition permit, or if the active entitlement and demotion permit are successive which may potentially result in a seven-year period during which the displaced applicant is eligible to qualify for these tiers.

1 https://www.irs.gov/affordable-care-act/employers/identifying-full-time-employees Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

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TABLE 4. EXISTING DISPLACEMENT TIME LIMIT PROVISIONS

TIER PROVISION LANGUAGE
4, 5, and 6 (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due;
(2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements remain valid and have not expired on the date the applications for the affordable housing units are due.

EXISTING PROVISION IMPLEMENTATION
TYPE DISPLACEMENT IMPLEMENTATION PER TIER 4, 5, AND 6 TIME LIMIT Active
Entitlement
Entitlements are generally granted for an initial three-year period before they expire and typically have the option to extend for an additional two years, during which the entitlements could be active.

Up to 5 years
Demolition
Permit
Demolition of the building at the project site. Up to 2 years Successive Demolition permit and an active entitlement are successive. Up to 7 years To place an appropriate time limit on displacement for the recommended Tier 2, staff evaluated the development process for a new development and tenant’s rights subject to the Ellis Act. The way the time limits for displacement for existing Tiers 4, 5, and 6 are applied, a household could be considered displaced for up to seven years. However, in some cases, the redevelopment process on a site may exceed this seven-year period, thus a household could be disqualified from being considered as displaced. Under the Ellis Act, displaced tenants, due to the unit being withdrawn from the rental market, are entitled to exercise the right of first refusal for the unit from which they were displaced for a period of 10 years after the withdrawal of the unit from the market ((BHMC § 4-5-513 (G)), Attachment G) Therefore, the proposed tier 2 is recommended to have a 10 year definition of displacement to be mindful of that the redevelopment process can be prolonged in certain cases and to also be consistent with existing tenant rights provisions included in the city’s rent stabilization ordinance.

Involuntary Displacement Enforcement
At the July 11 study session, the Planning Commission raised the concern of finding a means to verify involuntary vacation of a unit due to uninhabitable living conditions when defining displacement. Currently, the City’s Rent Stabilization Division and Community Preservation Division maintain procedures to determine whether a unit is uninhabitable. In the last three years, Community Preservation identified eight units that were “red tagged” or determined uninhabitable pursuant to the California Health and Safety Code Section 17980I for an enforcement agency (Community Preservation) to take governmental action when determining a building [or unit] is substandard as described in Section 17920.3 (substandard living conditions) (Attachment H).

Additionally, the Rent Stabilization Division has identified 16 units as uninhabitable by the Means and Method Plan process, where property owners and contractors detail the scope of the proposed project and address concerns impacting general occupant habitability, construction Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

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impact mitigation, and compliance with regulating building codes in an effort to protect tenants during construction ((BHMC 9-1-108(L)), Attachment I).

Therefore, there are existing efforts by the Rent Stabilization Division and Community Preservation Division to identify which units are eligible as uninhabitable and substandard where governmental action takes place in notifying the property owner. This often leads to tenants being displaced temporarily or at a risk of being displaced permanently, depending on the property owner’s actions to resolve the conditions of the unit. A detailed chart of the units identified as uninhabitable or red tagged can be viewed in Attachment J. To verify if the household was displaced due to the unit being uninhabitable, staff will need to work with the Rent Stabilization Division and Community Preservation Division to ensure that the unit was inspected and deemed uninhabitable.

Revised Occupancy Priority Standard and Displacement Definition Considering state law (SB 8), the Planning Commission’s July 11 study session direction, and recommendations from the City’s housing consultant, HouseKeys, Inc. based on their knowledge of best practices from other jurisdictions, the following revised occupancy priority standards are recommended in the draft ordinance in Table 5.

TABLE 5. RECOMMENDED OCCUPANCY PRIORITY
Occupancy priority for eligible units shall apply to income-qualified households and conform to the following tiers:

D. TIER 4 - Individuals employed full-time by a business located and operating in the City of Beverly Hills, and whose primary work location is located within the City of Beverly Hills. For purposes of this section, full-time employment is defined as a minimum average of 130 hours of service per calendar month over a six month period.

Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

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TABLE 6. RECOMMENDED DISPLACEMENT DEFINITION
For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property; b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer);
c. Withdrawal of the housing unit from the rental housing market under the Ellis Act; d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis, including but not limited to, when occupancy is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed substandard or uninhabitable.

GENERAL PLAN AND HOUSING ELEMENT IMPLEMENTATION2
The General Plan and Housing Element provides goals and policies to help guide development in the city. The 2021-2029 Housing Element outlines goals, policies, and programs to meet the city's current and projected housing needs. It aligns with state legislative directives such as SB 8, state density bonus law, and the city's inclusionary housing ordinance by encouraging accommodating diverse housing needs, including housing for all income levels and special housing needs. The Housing Element implementation programs require the city to continue administering an affordable housing program to maintain and monitor existing and new deedrestricted affordable housing units. The occupancy priority standards are a critical part of the administration and affordable housing placement program, which provides guidance on which households are prioritized for placement into affordable housing (Attachment K).

PUBLIC OUTREACH AND NOTIFICATION
TABLE 7. PUBLIC NOTIFICATION TABLE
Type of Notice Required
Period Actual Period Required Date Actual Date
Mailed Notice of Public
Hearing N/A N/A N/A N/A
Newspaper Notice3 20 Days 20 Days 8/23/2024 8/23/2024
Agenda Posting 72 Hours 7 Days 9/9/2024 9/5/2024
Website 72 Hours 7 Days 9/9/2024 9/5/2024
2 Available online at www.beverlyhills.org/housingelementupdate 3 The public notice for this item was published in the Beverly Hills Courier on August 23, 2024, and in the Beverly Hills Weekly and Beverly Press on August 30, 2024.

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Affordable Housing Occupancy Priority Ordinance
September 12, 2024

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ENVIRONMENTAL ASSESSMENT
The draft ordinance was assessed for compliance with California Environmental Quality Act (CEQA), the State CEQA Guidelines, and City environmental regulations, and has been determined to be exempt from CEQA per Section 15061(b)(3) of the State CEQA Guidelines, which applies the 'general rule' that CEQA does not extend to projects with no significant environmental effect. As a result, staff recommends the Planning Commission find that the draft ordinance is exempt from any further review under CEQA.

NEXT STEPS
Staff recommends that the Planning Commission adopt the resolution recommending approval of the draft ordinance (Exhibit A of Attachment A) to the City Council. Once the Planning Commission has completed their review and made a recommendation to City Council, the draft ordinance will be presented to the City Council at a future public hearing date for adoption. Staff will also bring forth the revised Affordable Housing Guidelines to the City Council for adoption at the time of draft ordinance review.

Report Reviewed By:

Masa Alkire, AICP
Assistant Director / City Planner
Community Development Department
Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

ATTACHMENT A
Draft Resolution (Exhibit A: Draft Ordinance)
1 RESOLUTION NO.

A RESOLUTION OF THE PLANNING COMMISSION OF THE

CITY OF BEVERLY HILLS RECOMMENDING ADOPTION OF

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

NOW, THEREFORE, the Planning Commission of the City of Beverly Hills hereby finds, resolves, and determines as follows:

Section 1. The Amendments have been environmentally reviewed pursuant to the provisions of the California Environmental Quality Act (Public Resources Code Sections 21000, et seq.(“CEQA”), the State CEQA Guidelines (California Code of Regulations, Title 14, 2 Sections 15000, et seq.), and the City’s Local CEQA Guidelines (hereafter the “Guidelines”). The Planning Commission finds that the Amendments are exempt from CEQA pursuant to Section 15061(b)(3) of the State CEQA Guidelines, which applies the 'general rule' that CEQA does not extend to projects with no significant environmental effect. As such, there is no possibility that the Amendments would result in a significant effect on the environment because the modifications do not enable any physical changes to the environment, directly or indirectly.

Section 2. The Amendments are consistent with the objectives, principles, and standards of the following General Plan and Housing Element Goals and Policies:
• H2 Housing Supply and Diversity. Provide a variety of housing types and adequate affordable housing supply
• H 2.2 Inclusionary Housing. Continue to implement an inclusionary housing program to integrate affordable units within market rate developments, and increase the availability of affordable housing throughout the community. (Imp. 10.2) • H 2.9 Jobs-Housing Balance. Promote programs seeking to provide housing opportunities for people who work in the City as a means of reducing long commutes, easing local traffic, improving air quality and helping to achieve a balanced regional jobs-housing distribution for the western portion of Los Angeles County. (Imp. 10.6) • H 2.10 Workforce Housing. Study and develop programs to increase the amount of rental and ownership housing affordable to the local workforce. (Imp. 10.3, 10.4) 3 • H 3 Fair Housing and Special Needs Residents. Promote equal housing opportunities for all residents; including Beverly Hills’ special needs populations, so residents have a choice of appropriate housing.
• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and non-discrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 3. The Planning Commission does hereby recommend to the City Council the adoption of an ordinance approving and enacting the proposed Amendments substantially as set forth in Exhibit A, which is attached hereto and incorporated herein by reference.
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//
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4 Section 4. The Secretary of the Planning Commission shall certify to the passage, approval, and adoption of this resolution, and shall cause this resolution and his/her Certification to be entered in the Book of Resolutions of the Planning Commission of the City.

Adopted: September 12, 2024
Theresa M. Kaplan
Chair of the Planning Commission of the
City of Beverly Hills
Attest:

Masa Alkire, AICP
Secretary of the Planning Commission
Approved as to form: Approved as to content:

David M. Snow Masa Alkire, AICP
Assistant City Attorney Assistant Director / City Planner Community Development Department
EXHIBIT A: Draft Ordinance
5 EXHIBIT A
-1-
[DRAFT] ORDINANCE NO. 24-O-_______

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT (CEQA)
WHEREAS, the City of Beverly Hills (“City”) desires to amend regulations in the Beverly Hills Municipal Code (“BHMC”) regarding priorities utilized to establish the order in which income restricted housing units will be offered to qualifying households, and include a definition of displacement from existing housing;
WHEREAS, on September 12, 2024, the Planning Commission held a duly noticed public hearing and which it adopted Resolution No._____ recommending that the City Council amend Article 15.2 (Residential Density Bonus) and Article 48 (Inclusionary Housing Requirements for Residential Development) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC addressing priority standards to be utilized to establish the order in which income restricted housing units will be offered to qualifying households, taking into account state law requirements, reducing the number of occupancy priority tiers, , include a tier prioritizing individuals who work in the city; and to add a definition of displacement and provide a consistent time limit for which households are considered displaced (collectively, the “Amendments”); and WHEREAS, The City Council considered the Ordinance on __________, 2024, at a duly noticed public hearing, as prescribed by law, at which time City staff presented the matter, and interested persons had an opportunity to and did testify either in support or against the ordinance. -2-
Following the public hearing, the City Council considered the entire record of information received at the public hearing before the City Council.

THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. The City Council finds that the adoption of this Ordinance is consistent with the General Plan because it fulfills the following General Plan and Housing Element Goals and Policies:
• H2 Housing Supply and Diversity. Provide a variety of housing types and adequate affordable housing supply
• H 2.2 Inclusionary Housing. Continue to implement an inclusionary housing program to integrate affordable units within market rate developments, and increase the availability of affordable housing throughout the community. (Imp. 10.2) • H 2.9 Jobs-Housing Balance. Promote programs seeking to provide housing opportunities for people who work in the City as a means of reducing long commutes, easing local traffic, improving air quality and helping to achieve a balanced regional jobs-housing distribution for the western portion of Los Angeles County. (Imp. 10.6) • H 2.10 Workforce Housing. Study and develop programs to increase the amount of rental and ownership housing affordable to the local workforce. (Imp. 10.3, 10.4) • H 3 Fair Housing and Special Needs Residents. Promote equal housing opportunities for all residents; including Beverly Hills’ special needs populations, so residents have a choice of appropriate housing.
-3-
• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and nondiscrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 2. Section 10-3-1528 (Occupancy Priority) of Article 15.2 (Residential Density Bonus) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC is hereby amended in its entirety to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

2. Tier 2 - Households displaced from a property within the City of Beverly Hills in the past ten years in the following order:
i. Senior households (62 years and older)
-4-
ii. Households with student(s) in 10th grade or lower enrolled in the Beverly Hills Unified School District
iii. Other displaced households

3. Tier 3 - Senior Households (62 years and older).

4. Tier 4 - Individuals employed full-time by a business located and operating in the City of Beverly Hills, and whose primary work location is located within the City of Beverly Hills. For purposes of this section, full-time employment is defined as a minimum average of 130 hours of service per calendar month over a six month period.

5. For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property;
b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer);
c. Withdrawal of the housing unit from the rental housing market under the Ellis Act;
d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
-5-
e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis, including but not limited to, when occupancy is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed substandard or uninhabitable.

6. Exceptions:

A. This article shall apply to all residential developments, as defined herein, where the lots or units will be offered for sale or for rent, and when the development application or applications for the residential development is deemed complete after the effective date of Ordinance 21-O-2850.
-6-
B. Notwithstanding subsection A, inclusionary units shall not be required for any project for which the city enters into a development agreement or for any project that is otherwise exempt under state law.

C. All inclusionary units shall be subject to the occupancy standards set forth in BHMC §10-3-1528.

Section 6. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the City within fifteen (15) days after its passage in accordance with Section 36933 of the Government Code, shall certify -7-
to the adoption of this Ordinance, and shall cause this Ordinance and his certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City. -8-
Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (31st) day after its passage.

Adopted:

Effective:
____________________________

LESTER FRIEDMAN
Mayor of the City of Beverly Hills,
California
ATTEST:
_________________________ (SEAL)

ATTACHMENT B
Draft Redlined Ordinance
-1-
[DRAFT] ORDINANCE NO. 24-O-_______

AN ORDINANCE OF THE CITY OF BEVERLY HILLS TO

AMEND THE BEVERLY HILLS MUNICIPAL CODE TO

REVISE OCCUPANCY PRIORITY STANDARDS FOR

ELIGIBLE AFFORDABLE HOUSING UNITS, ADD A

DEFINITION OF DISPLACEMENT, AND FINDING THE

ORDINANCE TO BE EXEMPT UNDER THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT
WHEREAS, the City of Beverly Hills (“City”) desires to amend regulations in the Beverly Hills Municipal Code (“BHMC”) regarding priorities utilized to establish the order in which income restricted housing units will be offered to qualifying households, and include a definition of displacement from existing housing;
WHEREAS, on September 12, 2024, the Planning Commission held a duly noticed public hearing and which it adopted Resolution No._____ recommending that the City Council amend Article 15.2 (Residential Density Bonus) and Article 48 (Inclusionary Housing Requirements for Residential Development) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC addressing priority standards to be utilized to establish the order in which income restricted housing units will be offered to qualifying households, taking into account state law requirements, reducing the number of occupancy priority tiers, , include a tier prioritizing individuals who work in the city; and to add a definition of displacement and provide a consistent time limit for which households are considered displaced (collectively, the “Amendments”); and WHEREAS, The City Council considered the Ordinance on __________, 2024, at a duly noticed public hearing, as prescribed by law, at which time City staff presented the matter, and interested persons had an opportunity to and did testify either in support or against the ordinance. -2-
Following the public hearing, the City Council considered the entire record of information received at the public hearing before the City Council.

THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. The City Council finds that the adoption of this Ordinance is consistent with the General Plan because it fulfills the following General Plan and Housing Element Goals and Policies:
• H2 Housing Supply and Diversity. Provide a variety of housing types and adequate affordable housing supply
• H 2.2 Inclusionary Housing. Continue to implement an inclusionary housing program to integrate affordable units within market rate developments, and increase the availability of affordable housing throughout the community. (Imp. 10.2) • H 2.9 Jobs-Housing Balance. Promote programs seeking to provide housing opportunities for people who work in the City as a means of reducing long commutes, easing local traffic, improving air quality and helping to achieve a balanced regional jobs-housing distribution for the western portion of Los Angeles County. (Imp. 10.6) • H 2.10 Workforce Housing. Study and develop programs to increase the amount of rental and ownership housing affordable to the local workforce. (Imp. 10.3, 10.4) • H 3 Fair Housing and Special Needs Residents. Promote equal housing opportunities for all residents; including Beverly Hills’ special needs populations, so residents have a choice of appropriate housing.
-3-
• H 3.1 Affirmatively Further Fair Housing Practices. Promote fair housing and nondiscrimination in the sale and rental of housing by coordinating with organizations that provide information, counseling and mediation on fair housing laws and landlord-tenant disputes. (Imp. 11.1)
Section 2. Section 10-3-1528 (Occupancy Priority) of Article 15.2 (Residential Density Bonus) of Chapter 3 (Zoning) of Title 10 (Planning and Zoning) of the BHMC is hereby amended in its entirety to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

Occupancy priority for eligible units shall conform to the following eight (8) tiers.

A. Tier 1 - Senior Tenants Displaced From The Project Site: First priority shall go to income qualified households in which at least one member is a senior (62 years and older) and that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units, then the order in which the units are offered to Tier 1 applicants shall be based on the period of time that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to any Tier 1 applicants having the same period of residency at the project site.

B. Tier 2 - Tenants With Beverly Hills Unified School District Students Displaced From The Project Site: Second priority shall go to income -4-
qualified households that include as part of the household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower, and that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units, the order in which the units are offered to Tier 2 applicants shall be based on the period of time that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to any Tier 2 applicants having the same period of residency at the project site.

C. Tier 3 -Tenants Displaced From The Project Site: Third priority shall go to income qualified households that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units the order in which the units are offered to Tier 3 applicants shall be based on the period of time that longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to Tier 3 applicants having the same period of residency at the project site.
-5-
D. Tier 4 - Displaced Senior Households: Fourth priority shall go to income qualified households in which at least one member is a senior (62 years and older) and that have or will be displaced or evicted from a multi-family building in the City other than the project site for the purpose of redevelopment if either: (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due; or (2) the multifamily property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 4 applicants shall be based on the period of time that the longest tenured members of the household resided at the multi-family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 4 applicants having the same period of residency at the project site.

E. Tier 5 - Displaced Tenants With Beverly Hills Unified School District Students: Fifth priority shall go to income qualified households that include as part of the household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower, and that have or will be displaced or evicted from a multi- -6-
family building in the City other than the project site for the purpose of redevelopment if either: (1) the multi-family building was demolished for redevelopment within the two (2) years immediately preceding the date on which applications for the affordable housing units are due; or (2) the multifamily property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements, remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 5 applicants shall be based on the period of time that the longest tenured member of the household resided at the multi-family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 5 applicants having the same period of residency at the project site.

F. Tier 6 - Displaced Households: Sixth priority shall go to income qualified households displaced from a multi-family building in the City that have or will be displaced or evicted from a multi-family building in the City other than the project site for the purpose of redevelopment if either: (1) the multifamily building was demolished for redevelopment within the two (2) years immediately preceding the date on which applications for the affordable housing units are due; or (2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such -7-
redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements, remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 6 applicants shall be based on the period of time that the longest tenured member of the household resided at the multi-family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 6 applicants having the same period of residency at the project site.

G. Tier 7 - Senior Households: Income qualified households with at least one member who is a senior (62 years and older). If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 7 applicants.

H. Tier 8 - Other Income Qualified Households: Income qualified households that do not meet the requirements of Tiers 1-7. If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 8 applicants.

I. Exceptions:
a. In the event that a density bonus is granted for specific tenants pursuant to State Density Bonus Law (California Government Code -8-
§ 65915 (b)(1)(E)) then the tiered list provided in this section shall not be used to fill the affordable housing units.
b. In the implementation of these priorities, the City shall in no way discriminate against any person or family due to disability.

1. Tier 1 - Existing occupants of protected units, as defined in Government Code Section 66300.5(h) as it may be amended from time to time, who are lower-income households on a project site and who are displaced by a new development on the same site and are exercising a right of first refusal for a comparable unit in the new housing development, or in any required replacement units associated with a new development that is not a housing development, pursuant to Government Code Section 66300.6(b)(4)(B), as amended from time to time.

2. Tier 2 - Households displaced from a property within the City of Beverly Hills in the past ten years in the following order:
i.Senior households (62 years and older)
ii.Households with student(s) in 10th grade or lower enrolled in the Beverly Hills Unified School District
iii.Other displaced households
-9-

3. Tier 3 - Senior Households (62 years and older).

5. For purposes of this section, displacement or displaced shall be defined as when persons have permanently vacated their primary housing unit in the City, or are at risk of having to permanently vacate their primary housing unit within the City of Beverly Hills as a result of any of the following:
a. Demolition of the housing unit due to a new development project on the subject property;
b. Voluntary vacation of the housing unit related to a new development project on the subject property (for example, accepting cash for keys offer);
c. Withdrawal of the housing unit from the rental housing market under the Ellis Act;
d. Involuntary vacation of a housing unit due to a natural disaster such as an earthquake, fire, or flood;
e. Involuntary vacation of a housing unit as a result of a dangerous condition of the property making the unit unsafe to occupy on a permanent basis, including but not limited to, when occupancy -10-
is no longer permitted pursuant to California Health and Safety Code regulations relating to a unit or building deemed
substandard or uninhabitable.

6. Exceptions:

B. Notwithstanding subsection A, inclusionary units shall not be required for any project for which the city enters into a development agreement or for any project that is otherwise exempt under state law.
-11-
A. This article shall apply to all residential developments, as defined herein, where the lots or units will be offered for sale or for rent, and when the development application or applications for the residential development is deemed complete after the effective date of Ordinance 21-O-2850.

C. All inclusionary units shall be subject to the occupancy standards set forth in BHMC §10-3-1528.

Section 5. Severability. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this Ordinance or the application thereof to any person or place, is for any reason held to be invalid or unconstitutional by the final decision of any court of competent jurisdiction, the remainder of this Ordinance shall be and remain in full force and effect. -12-
Section 6. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the City within fifteen (15) days after its passage in accordance with Section 36933 of the Government Code, shall certify to the adoption of this Ordinance, and shall cause this Ordinance and his certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City. -13-
Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (31st) day after its passage.

Adopted:

Effective:
____________________________

LESTER FRIEDMAN
Mayor of the City of Beverly Hills,
California
ATTEST:
_________________________ (SEAL)

ATTACHMENT C
2017 Planning Commission Staff Report
Revised Occupancy Priority
City of Beverly Hills
Planning Division
455 N. Rexford Drive Beverly Hills, CA 90210
TEL. (310) 285-1141 FAX. (310) 858-5966
Planning Commission Report
October 12, 2017

AFFORDABLE HOUSING OCCUPANCY PRIORITY

ORDINANCE
An Ordinance amending Beverly Hills Municipal Code § 10-3- 1528 pertaining to the occupancy priority for affordable housing units built in the city pursuant to the City’s residential density bonus regulations.

City Initiated
Adopt the attached resolution recommending to the City Council an ordinance amending the priority list for affordable housing units in the City.

Report Author and Contact Information:

Simi Aliu, Community Development Intern
[email protected]
Timothea Tway, Senior Planner
[email protected]
(310) 285-1122
Meeting Date:

Subject:

Project Applicant:

Recommendation:

REPORT SUMMARY
The Beverly Hills Municipal Code (BHMC) outlines the order in which individuals are prioritized for consideration for affordable housing units in the City that are built pursuant to residential density bonus regulations authorized by State of California Government Code Sections 65915 and 65915.5. Staff has found that the existing priority list is unclear and may not accurately represent the priorities of the City. On May 25, 2017, the Planning Commission considered changes to the priority list at a study session and provided staff with comments. This report includes a summary of the comments received, analysis of potential changes to the City’s Code language, and an explanation of the recommended changes that staff has integrated into the attached draft Ordinance.

BACKGROUNDIn 2005 the City Council adopted Ordinance No. 05-0-2482 establishing regulations for residential Density Bonus projects in the City of Beverly Hills, consistent with a mandate to implement State Density Bonus law. The language in Ordinance 05-0-2482 also established an occupancy priority methodology for individuals and families to be placed in affordable housing units that are built in the City pursuant to Residential Density Bonus regulations (BHMC Article 15.2). The existing priority list is codified in the Municipal Code in § 10-3-1528 as follows:
70-3-1528: OCCUPANCY PRIORITY:

A. Resolution and Draft Ordinance
B. Public Comment
Planning Commission Report
Affordable Housing Priority List
October 12, 2017

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shall be given a right of first refusal to occupy any unit for which the tenant qualifies in the newly constructed or renovated building. Tenants shall be offered the units in the following priority:

1. Households in which at least one member is sixty two (62) years of age or older;

2. Households with the lowest annual income.

B. Lower And Very Low Income Households: After accommodating displaced tenants as provided in subsection A of this section, during the affordability period described in section 10-3-1529 of this article for rental units designated for lower and very low income households, and subject to any limitations imposed by federal or state law, the owner or developer shall offer the designated affordable units in the following priority:

1. Qualified households in which at least one member is:
a. Employed by the Beverly Hills Unified School District as a state certified classroom teacher; or
b. Employed by the Beverly Hills police department as a sworn law enforcement officer; or
c. Employed by the Beverly Hills fire department as a sworn firefighter;

2. Households with the lowest annual income;

3. All other qualified households.

C. Moderate Income Households: During the initial sale of units designated for sale to moderate income households, and subject to any limitations imposed by federal or state law, the owner or developer shall offer the designated units in the following priority:

2. Households with the lowest annual income;3. All other qualified households Planning Commission Report
Affordable Housing Priority List
October 12, 2017

Page 3 of 9 ends

DISCUSSION
During the May 25 Planning Commission study session on the topic, staff identified a number of deficiencies in the current priority list including:
• The priority list is not clearly written and can be confusing. • The priority list unnecessarily separates low! very low income units and moderate income units and defines low/very low income units as being for rent only, with moderate income units as being for sale only, which does not accurately capture the situations that can occur and does not align with current State law.
• Some groups included in the list, such as sworn firefighters, law enforcement officers, and certified teachers, would be unlikely to meet the State mandated income limits for placement in affordable housing in the City.
• As currently written the list results in the individual/family with the lowest income in any particular qualifying category as automatically receiving occupancy priority. A more equitable way of structuring the list would be for qualifying individuals within any qualifying category to be eligible for a lottery within that category. Addressing this issue could be more equitable and may disincentivize manipulation of applications. • Several Councilmembers and Commissioners have expressed interest in incentivizing affordable housing for seniors and addressing the need to provide housing options for those that may be displaced during the development of a new housing project. The current list does not adequately address these priorities.

In order to clarify the occupancy priority list, and bring it in line with priorities expressed by Councilmembers and Commissioners, staff recommended that the list be changed to the following:

1. First priority - Seniors (62 years and older) who are/or will be displaced from the site of development;

2. Second priority - Anyone else who is or will be displaced from the site of development;3. Third priority -Seniors (62 years and older) displaced from any recently (within the past 2 years) demolished multi-family building in the City or are living in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment;

4. Fourth priority - Anyone displaced from a recently (within the past 2 years) demolished multi-family building in the City or living in a multi-family property in the City that has recently (within past 2 years) received entitlements for redevelopment;

5. Fifth priority - Seniors that have not been displaced by a project; Planning Commission Report Affordable Housing Priority List October 72, 2017

Page 4 of 9 ends

6. Sixth priority - Permanently disabled individuals

7. Seventh priority - Income qualified individuals that do not fit into the above categories.

May 25, 2077 Planning Commission Discussion
During the May 25, 2017 Planning Commission meeting both the Planning Commission and members of the public provided staff with comments related to the revised priority list.

These comments included the following:
• General support for the suggested changes to the priority list; • Request to staff to research the possibility of changing the qualifying age of senior citizen status from 62 to 65; • Support for the change to implement a lottery system within each tier; • Request to staff to research the prioritization of exclusively senior households as opposed to multi-generational households; • Discuss whether equal priority should be given to single households and family households; • Request to research the addition of an additional priority level that prioritizes individuals displaced due to financial hardship/foreclosure; • Request to staff to research limiting the definition of disability to only include physical constraints; and • Support for the removal of City of Beverly Hills and Beverly Hills Unified School District employees as a prioritized class on the list.

In order to address the comments made by the Commission and public, staff conducted research on the relevant topic areas by consulting Federal, State, and other municipality regulations. Staff also consulted with the City Attorney regarding the legality of suggested revisions.

Several of the comments provided during the May 25, 2077 Planning Commission meeting resulted in changes that are represented in the draft Ordinance (Attachment A). Several required additional research or consultation with the City Attorney’s Office and are described below.

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Request to staff to research the possibility of changing the qualifying age of senior citizen status from 62 to 65.

Staff has conducted research both at the Federal and State level and has reviewed other city definitions of “senior citizen”. The definitions are included in the table below:

Agency/Jurisdiction Definition of “senior citizen” for the purposes of housing Housing and Urban Under federal law, senior housing is regulated by the Housing for Older Persons Act (HOPA) Development (HUD) Under HOPA, there are two types of senior housing, one for individuals 62+ and one for individuals 55+. A property is entitled to the 62 and older exemption if all residents (except disability-related caregivers) are 62 years or older. In order for a property to qualify for the “55 or older” housing exemption, a facility or community must satisfy each of the following requirements:
• At least 80 percent of the units must have at least one occupant who is 55 years of age or older; and
• The facility or community must publish and adhere to policies and procedures that demonstrate the intent to operate as “55 or older” housing; and. The facility or community must comply with HUD’s regulatory requirements for age verification of residents.

Santa Monica Depending on the property senior housing is restricted to persons 62 years of age or older, or 55 years of age or older in a senior citizen housing development.

West Hollywood Senior citizen is defined as an adult 60 years or older.

Culver City Senior housing reserved for people over the age of 62.

Inglewood Senior citizen is defined as a person 62 years or older.

State Law “Qualifying resident” or “senior citizen” means a person 62 years of age or older, or 55 years of age or older in a designated senior citizen housing development.

As illustrated in the table above, several agencies and municipalities use 62 and/or 55 as the age for senior citizen status for the purpose of housing. None of the agencies or jurisdictions use an age higher than 62 for the purposes of defining seniors. Based on this information, as well as consultation with the City Attorney, staff recommends retaining the current age of 62 for the purposes of defining a senior citizen for affordable housing in the City.

Support for the change to implement a lottery system in each tier.

During Commission deliberation at the May 25, 2017 hearing there was general agreement that using a lottery system within each priority category is the most equitable method of allocating affordable housing units in the City. The use of a lottery system has been included in the text of the draft Ordinance.
(‘)
Planning Commission Report Affordable Housing Priority List October 12, 2017

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Request to staff to research the prioritization of exclusively senior households as opposed to multi-generational households.

Commission members discussed the possibility of limiting units to exclusively senior households, where all members of the household would be required to be at or above the minimum age to qualify as a senior. Staff has identified several concerns regarding this potential change. First, the prioritization of exclusively senior households could impact households where one spouse qualifies as a senior and one does not (for example,
a couple where one member is 65 and the other is 61). Further, the prioritization of exclusively senior households over households with at least one senior member could impact a senior household where
a younger caretaker lives with
a senior in order to provide care and/or companionship. Several Commissioners expressed concern that an individual could take advantage of the availability of affordable units by moving in with a senior relative to benefit from the affordability of that unit, It is important to consider that regardless of the age of the occupants of the unit, the combined income and assets of all household members would be considered to qualify a household as low income. Because of this, it is unlikely that an individual with an income above the qualification thresholds could use a senior to obtain affordable housing and abuse the system. Staff recommends that the Planning Commission retain the proposed language, which allows a household with at least one senior member to qualify as a senior household.

Discuss whether equal priority should be given to single households and family households.

Staff recommends that the draft ordinance offer equal priority to single households and family households and not prioritize one over another.

A household with multiple members is equally deserving of housing as an individual and there is no rational argument that a single individual is
more deserving of
a unit than
a household with multiple members. Further, the combined income of all adult household members will be considered as part of the household income for the purposes of qualification, which ensures that only deserving households are considered for placement in affordable units. Additionally, establishing equal priority for both single and family household ensures that senior citizens who require extra assistance will have the option to live with their caretakers.

Request to research the addition of an additional priority level that prioritizes individuals displaced due to financial hardship/foreclosure.

The Commission requested that staff explore the addition of a priority level for those that have been recently displaced from housing in the City due to foreclosure or similar financial hardship. Staff explored this request, taking into consideration the feasibility and legality of the request. Ultimately, staff recommends against adding this tier to the priority list, due to the fact that it would be difficult to create an acceptable definition of “financial hardship” (as this term could mean different things to different people) and it would also be difficult for staff to verify financial hardship in a satisfactory manner. Alter consultation with the City Attorney, staff was advised not to include a tier specifically for households that have experienced foreclosure or financial hardship. jLS
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Affordable Housing Priority List
October 12, 2017

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ReQuest to staff to research limiting the definition of disability to only include physical constraints.

After reviewing potential methods and metrics that could be used to evaluate eligibility, staff recommends completely removing individuals with disabilities from the list largely on the basis that Community Development staff does not have the training and resources to consistently and objectively determine whether an individual’s disability meets the requirement outlined in the priority list. Evaluating an individual for a disability involves the handling and investigation of very sensitive personal information. Including this consideration leaves the City vulnerable to potential legal issues and liability. Although individuals with disabilities will not be explicitly mentioned in the priority list, this population will have an equal chance of being selected during the process.

Support for the removal of City of Beverly Hills and Beverly Hills Unified School District employees from the list.

Commission members collectively agreed with the staff recommendation to remove City of Beverly Hills and Beverly Hills Unified School District employees from the priority list because it is very unlikely that these individuals would meet the income requirements for the affordable units, and the inclusion of City and school employees on the list does not further the community goals of providing housing for those with the most need.

Draft Ordinance
The draft ordinance provides six clearly defined tiers of households that should be prioritized for affordable housing built pursuant to the City’s Density Bonus regulations. The goal of the revised priority list is to remove ambiguity or misinterpretation over who qualifies as eligible for Density Bonus affordable housing units. Staff also believes that the proposed list captures a
more accurate pool of income qualified individuals and prioritizes households that reflect the goals of the community by placing displaced households and senior households as higher priority groups on the priority list. Additionally, the proposed list is not an income based ranking system and would instead operate as a lottery system within each tier. This change is recommended as a more equitable method of distributing affordable housing that would have less potential to be manipulated in the application process.

As proposed the draft ordinance helps meet General Plan Policy H3.2 “Senior Housing” that calls for support of a provision of
a variety of housing options for seniors to foster independence and the ability of seniors to remain in the community as they age and Policy H3.4 “Housing Accessibility,” which encourages the addressing of housing for persons with disabilities.

It is important to note that individuals/families in each tier would still need to be income qualified to be eligible for placement in an affordable unit. Under the new priority list, individuals/families qualifying in any tier listed above would be eligible to be randomly selected through a lottery for
occupancy priority within the tier. The proposed tiered system outlined in the draft ordinance achieves several goals that are in line with policies included in the City of Beverly Hills General Plan and is more consistent with comments that have been made recently about housing needs in the City.

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Affordable Housing Priority List
October 12, 2017

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The Tiers recommended in the attached draft ordinance are as follows:

1. Income qualified households in which at least one member is a senior (62 years and older) who ate/or will be displaced from the site of development;

2. Income qualified household that is or will be displaced from the site of development;

3. Income qualified household in which at least one member is a senior (62 years and older) displaced from any recently (within the past 2 years) demolished multi-family building in the City or are living in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment;

4. Income qualified household displaced from a recently (within the past 2 years) demolished multi-family building in the City or living in a multi-family property in the City that has recently (within past 2 years) received entitlements for redevelopment;

5. Income qualified household with at least one member who is a senior that do not fit the above categories;

6. Income qualified individuals/households that do not fit into the above categories.

ENVIRONMENTAL ASSESSMENT
This Ordinance has been assessed in accordance with the authority and criteria contained inthe California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. The adoption and implementation of the Ordinanceappears to be eligible for a class 5 categorical exemption for minor changes in land use limitations and the Ordinance could be found to not have a significant environmental impact. Further, it can be seen with certainty that there is no possibility that the adoption and implementation of the Ordinance could have a significant effect on the environment. Staff recommends that the Planning Commission find that this Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 15305 of Title 14 of the California Code of Regulations and Section 15061(b)(3) of Title 14 of the California Code of Regulations.

PUBLIC NOTICE AND COMMENT
Notice of this hearing was published in the Beverly Hills Courier on September 29, 2017 and the Beverly Hills Weekly on October 5, 2017 and courtesy notices were emailed to interested parties. To date, staff has not received comments from the public regarding this draft ordinance. Public comment that was received prior to the Planning Commission Study Session held in May have been included in Attachment B.

Planning Commission Report
Affordable Housing Priority List
October 12, 2017

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RECOMMENDATION
Staff recommends that the Planning Commission adopt the attached resolution recommending to the City Council an ordinance amending Beverly Hills Municipal Code § 10-3-1528 pertaining to the occupancy priority for affordable housing units built in the city pursuant to the City’s residential density bonus regulations. Pursuant to the provisions set forth in the California Environmental Quality Act, the Commission will also consider adoption of a Categorical Exemption for the amendment.

Report Reviewed By:

Rych,Al,Asant Director of Community
De e ment I City Planner
Planning Commission Report
Affordable Housing Priority List
October 12, 2017
Attachment A
Resolution and Draft Ordinance

BEVERLY
HILLS
RESOLUTION NO.

A RESOLUTION OF THE PLANNING COMMISSION OF THECITY OF BEVERLY HILLS RECOMMENDING TO THE CITY

COUNCIL AMENDMENTS TO BEVERLY HILLS
MUNICIPAL CODE SECTION 10-3-1528 PERTAINING TO

THE OCCUPANCY PRIORITY FOR AFFORDABLE HOUSING
UNITS BUILT IN THE CITY PURSUANT TO THE CITY’S
RESIDENTIAL DENSITY BONUS REGULATIONS.

WHEREAS, the Planning Commission has considered the proposed amendment to the City of Beverly Hills Municipal Code, as set forth and attached hereto as Exhibit A and more fully described below (the “Amendment”); and
WHEREAS, the Planning Commission conducted a duly noticed public hearing on October 12, 2017 at which time it received oral and documentary evidence relative to the proposed Amendment; and
WHEREAS, the Planning Commission finds that the proposed Amendments are required for the public health, safety, and general welfare, and that such Amendments are consistent with the general objectives, principles, and standards of the General Plan; NOW, THEREFORE, the Planning Commission of the City of Beverly Hills does resolve as follows:

Section 1. The Amendments have been environmentally reviewed pursuant to the provisions of the California Environmental Quality Act (Public Resources Code Sections 21000, Ct seq.(”CEQA”), the State CEQA Guidelines (California Code of Regulations, Title 14, Sections 15000, et seq.), and the City’s Local CEQA Guidelines (hereafter the “Guidelines”). The adoption and implementation of the Ordinance represents minor changes in land use limitations and it can be seen with certainty that there is no possibility that the adoption and implementation of the Ordinance could have a significant effect on the environment. Therefore, the Planning Commission finds that the Ordinance is eligible for a class 5 categorical exemption for minor changes in land use limitations pursuant to Section 15305 of Title 14 of the California Code of Regulations and the Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 1506 l(b)(3) of Title 14 of the California Code of Regulations.

Section 2. As proposed, the Amendments to the Beverly Hills Municipal Code in Exhibit A would establish six tiers of prioritization for occupancy priority for affordable units built pursuant to the City’s residential density bonus regulations. The tiers prioritize households in the follow order: displaced seniors from the project site, displaced individuals or households from the project site, seniors displaced from any multi-family site due to redevelopment within the past two years, displaced individuals or households from any multi-family site because of redevelopment within the past two years, seniors (not displaced by a project), and income qualified individuals or households.

Section 3. The Amendments are consistent with the objectives, principles, and standards of the General Plan. General Plan Policies “H3 “Fair Housing and Special Needs Residents” call for the promotion of equal housing opportunities for all residents so residents have a choice of appropriate housing. Included in this goal are Policy H3.2 “Senior Housing” that calls for support of a provision of a variety of housing options for seniors to foster independence and the ability of seniors to remain in the community as they age. 2 Section 4. The Planning Commission does hereby recommend to the City Council the adoption of an ordinance approving and enacting the proposed Amendments substantially as set forth in Exhibit A, which is attached hereto and incorporated herein by reference.

Section 5. The Secretary of the Planning Commission shall certify to the passage, approval, and adoption of this resolution, and shall cause this resolution and his/her Certification to be entered in the Book of Resolutions of the Planning Commission of the City.

Adopted: October 12, 2017
Lori Greene Gordon
Chair of the Planning Commission
of the City of Beverly Hills
Attest:

Ryan Gohlich, AICP
Secretary of the Planning Commission
Approved As To Form: Approved As To Content:

David M. Snow Ryan Gohlich, AICPAssistant City Attorney Assistant Director / City Planner Community Development Department
3 17
1I[HXEI
V
[DRAFT] ORDINANCE NO. 17-0-

AN ORDINANCE AMENDING BEVERLY HILLS
MUNICIPAL CODE SECTION 10-3-1528 PERTAINING TOTHE OCCUPANCY PRIORITY FOR AFFORDABLE HOUSING UNITS BUILT IN THE CITY PURSUANT TO THE CITY’SRESIDENTIAL DENSITY BONUS REGULATIONS.

THE CITY COUNCIL OF THE CITY OF BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. On October 12, 2017, the Planning Commission held a duly noticed public hearing after which it adopted Resolution No.
recommending that the City Council
amend portions of Title 10 (Planning and Zoning) of the Beverly Hills Municipal Code to refine the occupancy priority list for affordable housing units built in the City pursuant to the City’s Density Bonus regulations (collectively, the “Amendments”). On __________,
2017, the City
Council held a duly noticed public hearing, received public testimony, and thereafter introduced this Ordinance.

Section 3. The adoption and implementation of the Ordinance represents minor changes in land use limitations and it can be seen with certainty that there is no possibility that the adoption and implementation of the Ordinance could have a significant effect on the environment. Therefore, the City Council finds that the Ordinance is eligible for a class 5 categorical exemption for minor changes in land use limitations pursuant to Section 15305 of Title 14 of the California Code of Regulations and the Ordinance is exempt from the —1—
environmental review requirements of CEQA pursuant to Section 1506 l(b)(3) of Title 14 of the California Code of Regulations.

Section 4. The Amendments are consistent with the objectives, principles, and standards of the General Plan. General Plan Policy H3 “Fair Housing and Special Needs Residents” calls for the promotion of equal housing opportunities for all residents including Beverly Hills’ special needs populations. Included in this Goal is Policy H3.2 “Senior Housing” that calls for support of a provision of a variety of housing options for seniors to foster independence and the ability of seniors to remain in the community as they age.

Section 5. The City Council hereby amends Section 10-3-1528 of Article 15.2 of Chapter 3 of Title 10 of the Beverly Hills Municipal Code to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

A. Occupancy priority for eligible units shall conform to the following six tiers.

B. Tier 1 -Senior Tenants Displaced from the Project Site: First priority shall go to income qualified households in which at least one member is a senior (62 years and older) that are or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. if the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the displaced qualified seniorapplicants.

C. Tier 2 —Tenants Displaced from the Project Site: Second priority shall go to income qualified households that are or will be required to vacate existing dwelling units -2-
on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this group exceeds the number of available units, then a lottery shall be held within this group to determine the order in which the units are offered to the displaced qualified applicants.

D. Tier 3 — Displaced Senior Households: Income qualified households in which at least one member is a senior (62 years and older) that have been displaced from any multi-family building in the City that was demolished within the past two years from the date on which the affordable housing units become available or that are living in a multi family property in the City that has received all entitlements, excluding building permits, to redevelop the site in a manner that all residents must vacate the site which entitlements remain valid and have not expired. If the number of qualified applicants in this tier exceed the number of available units, then a lottery shall be held within this tier todetermine the order in which the units are offered to the qualified displaced senior applicants.

E. Tier 4 — Displaced Households: Income qualified households displaced from amulti-family building in the City that was demolished within the past two years from thedate on which the affordable housing units become available or that are living in a multifamily property in the City that has received all entitlements, excluding building permits, to redevelop the site in a manner that all residents must vacate the site which entitlements remain valid and have not expired. if the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the qualified applicants. -3-
F. Tier 5 — Senior Households: Income qualified households with at least one member who is a senior (62 years and older). If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the qualified senior applicants.

G. Tier 6 — Other Income Qualified Households: Income qualified households that do not meet the requirements of Tiers 1-5. If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the qualified applicants.

H. Exceptions:

1. In the event that a density bonus is granted for specific tenants pursuant to State Density Bonus Law (California Government Code § 65915 (b)(1)(E) then the tiered listprovided in this section shall not be used to fill the affordable housing units.

2. In the implementation of these priorities, the City shall in no way discriminate against any person or family due to disability.

Section 6. Severability. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this Ordinance or the application thereof to any person or place, is for any reason held to be invalid or unconstitutional by the final decision of any court of competent jurisdiction, the remainder of this Ordinance shall be and remain in full force and effect.

Section 7. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the City within fifteen (15) days after its passage in accordance with Section 36933 of the Government Code, -4-
shall certify to the adoption of this Ordinance, and shall cause this Ordinance and his certification, together with proof of publication, to be entered in the Book of Ordinances of the Council of this City.

Section 8. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (3 1st) day after its passage.

Adopted:

Effective:

ULI BOSSE
Mayor of the City of
Beverly Hills, California
ATTEST:
______(
)

BYRON POPE
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:

LAURENCE S. WIENER MAHDI ALUZRI
City Attorney City Manager

SUSAN HEALY KEENE
Director of Community Development
-5-
Attachment B
Public Comment
Planning Commission Report
Affordable Housing Priority List
May 25, 2017
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To: The Planning Commission
Re: Affordable Units
My name is Julia Geib and I am
a resident in the city since 2010. As
a resident of
Beverly Hills the city I call home and deeply care about, I propose to address the following issues:
> To make the priority based on the genuine need of the qualifying individuals. The need is always based on very low income and the level of hardship. For example, elderly, people with very low income and disability should have the biggest priority. People who can demonstrate the most dire need are the ones that should be considered first. For example, single mothers who are struggling to make ends meet every month for a prolonged period of time.

Those who struggle financially and otherwise are on the verge of getting displaced due to either financial or health hardship. for example, people who already live in the city for a while and would like to remain living in the city but due to the rental increases and financial hardship cannot maintain the current residence. Those who struggle usually cannot keep up with rental increases and tap into their emergency saving for example to pay rent! > Also, in this category could be included for people with disabilities, health issues or the elderly over 62 years old. Those who need to remain in the city with children, stay at home moms who lost their husbands for example or those who are going through divorce, without a job, without retirement,
having depleted all their assets and about to go insolvent. Any individuals who can prove this kind of hardship need to have the highest priority.

It is for those people who struggle day-to-day, experienced some kind of life changing event or
a loss and are on the verge of losing roof over their head. It is for those people that getting this roof over the head will provide a muchneeded break and respite. It is for those people whom the city would be literally saving from homelessness and devastation that is associated with it.

People who were laid off from work, unemployed or those who cannot find a
job for quite some time, events that is out of people’s control. One thing is to choose to move and another is to be told to leave! More than million homes have been lost to foreclosure. There are many displaced families who were traumatized by that experience and probably exhausted all their resourced in hopes of recovery. Those people should be
a priority. Clinical psychologists define having
a roof as
a potent symbol of one’s place in the social universe,
of “how you see yourself and how you want to be portrayed in the world.

When people lose it, it is like their planet blew up. I think the job of the city in this circumstance is to rescue those individuals. They may not even be very vocal but those are the ones that need saving the most. Those people that experience loss and haven’t been able to recover from it, mothers with children... Those people should be given priority.

People with jobs are lucky to have a job. If someone has been employed like a teacher, firefighter or police officer they are lucky to have a job, they do not have a threat-hanging overhead of loosing a place to live like those who are currently experience loss or had already once lost the roof over the head in the past due to hardship!
> I would make a priority for disabled individuals, the elderly and single mothers with children.

Perhaps even on a case by case basis, because hardship is an extremely sensitive to each individual.

They have to demonstrate genuine need and city has to be vigilant about those who are going to try to take advantage of the less fortunate ones. Usually the less fortunate do not have this ability to make a lot of noise for him or herself and the city has to step up and protect those in real genuine need! Perhaps the city could build much more of those units so there is no shortage. No one should ever have the experience of being left behind and have to go through losing a home without any recompense. If someone got displaced due to construction, I am sure they got some recourse for it, it is people who were dealt an unfair hand in life and suffered tremendously, survived or barely surviving a life changing event that was out of his/her control like losing a home to foreclosure or those who are on the verge of despair with no help in sight and $20 to their name...Those are the ones that are in desperate need and need help the most!I have always admired my city of Beverly Hills and it is proud acclaim to be a health city. In this regard the city has to step in like a doctor and prevent what could bring plaque and despair on the streets of our beautiful city. Saving some individuals who are in desperate need, can only serve as a good reflection and assurance in the years to come for the well being of the city itself! Regards,
Julia Geib (resident of Beverly Hills)
May 25, 2017
Planning Commission Report
Affordable Housing Occupancy Priority Ordinance
September 12, 2024

ATTACHMENT D
2019 City Council Staff Report
Revised Occupancy Priority
Meeting Date: September 17, 2019
Item Number: F—3
To: Honorable Mayor & City Council
From: Susan Healy Keene, AICP, Director of Community Development Timothea Tway, AICP, Senior Planner
Subject: AN ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING BEVERLY HILLS MUNICIPAL CODE SECTION 10-3-1528

PERTAINING TO THE OCCUPANCY PRIORITY FOR AFFORDABLE
HOUSING UNITS BUILT IN THE CITY PURSUANT TO THE CITY’S
RESIDENTIAL DENSITY BONUS REGULATIONS.

Attachments: 1. Ordinance

2. Redlined Ordinance Showing Changes since September 10, 2019 City Council Meeting

3. September 10, 2019 City Council Staff Report

RECOMMENDATION
Pursuant to the Planning Commission’s review and recommendations, staff recommends that the City Council move to waive the full reading of the ordinance and that the ordinance entitled “AN

ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING BEVERLY HILLS MUNICIPAL CODE § 10-3-1528 PERTAINING TO THE OCCUPANCY PRIORITY FOR AFFORDABLE HOUSING UNITS BUILT IN THE CITY PURSUANT TO THE CITY’S RESIDENTIAL DENSITY BONUS REGULATIONS” be introduced and read by title only.

BACKGROUND
On September 10, 2019 the City Council considered an ordinance amending the Beverly Hills Municipal Code (BHMC) to change the occupancy priority list for affordable housing units built in the City. The staff report from the September 10 meeting is included as Attachment 3 to this report. At this meeting, the City Council received a staff report, considered public comment, and

AGENDA REPORT

Page 1 of 5 ends

Meeting Date: September 17, 2019
discussed the proposed ordinance. As a result of the discussion, the City Council directed staff to make several changes to the ordinance and return to the September 17, 2019 City Council meeting. This report summarizes the changes that have been made in response to the City Council comments received on September 10.

DISCUSSION
On September 10, 2019, staff presented an ordinance to the City Council that would create six distinct tiers to prioritize occupants for affordable housing units developed in the City. The tiers were as follows:

1. Income qualified households in which at least one member is a senior (62 years and older) who are/or will be displaced from the site of development;

2. Income qualified households that are or will be displaced from the site of development;

3. Income qualified households in which at least one member is a senior (62 years and older) displaced from any recently (within the past 2 years) demolished multi-family building in the City or are living in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment;

4. Income qualified households displaced from a recently (within the past 2 years) demolished multi-family building in the City or living in a multi-family property in the City that has recently (within past 2 years) received entitlements for redevelopment;

5. Income qualified households with at least one member who is a senior that does not fit the above categories;

6. Income qualified households that do not fit into the above categories.

More detailed information about the tiers and the process for renting the affordable units is provided in Attachment 3.

At the September 10 public hearing, the City Council directed staff to make the following changes to the ordinance language:

1. Amend the language related to displaced households (Tier 3 and Tier 4) to ensure that households that were forced to vacate a building in the City due to redevelopment are eligible “displaced households” even if the building has not yet been demolished (at the time that affordable housing applications are due), and/or the household is not currently living in the building that will be demolished.

2. Add two tiers to prioritize displaced families with students in the Beverly Hills Unified School District. The City Council requested that displaced households with students be prioritized after senior displaced households in the occupancy list. The City Council also requested that the priority clarify that the student must be a sophomore or younger.

3. Include language in the ordinance to clarify that displaced households shall be ranked within each priority level by longevity in the building from which the household is being/was Page2ofs
Meeting Date: September 17, 2019
displaced. This change would mean that if there are two senior households displaced from the site of the development, the senior household that has lived at that site for the longer period of time would be ranked higher than the other senior household.

As a result of these comments staff has amended the ordinance language. The new priority list is reflected in the attached ordinance (Attachment 1) and is as follows:

1. Income qualified households in which at least one member is a senior (62 years and older) who are/or will be displaced from the site of development. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of development. The highest ranking shall go to the household that has been residing at the site the longest period of time and so forth;

2. Income qualified households that include a legal guardian of a student(s) in the Beverly Hills Unified School District and the guardian that is/or will be displaced from the site of development. The youngest Beverly Hills Unified School District student in the household must be in grade 10 or below at the time that the affordable housing application is due. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of development.

The highest tanking shall go to the household that has been residing at the site the longest period of time and so forth;

3. Income qualified households that are or will be displaced from the site of development. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of development.

The highest ranking shall go to the household that has been residing at the site the longest period of time and so forth;

4. Income qualified households in which at least one member is a senior (62 years and older) displaced from any recently (within the past 2 years) demolished multi-family building in the City or households that are living in and will be displaced or evicted for the purpose of redevelopment of the property in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of redevelopment. The highest ranking shall go to the household that has been residing at the site the longest period of time and so forth;

5. Income qualified households that include a legal guardian of a student(s) in the Beverly Hills Unified School District and the guardian has been displaced from any recently (within the past 2 years) demolished multi-family building in the City or households that are living in and will be displaced or evicted for the purpose of redevelopment of the property in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment. The youngest Beverly Hills Unified School District student in the household must be in grade 10 or below at the time that the affordable housing application is due. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of redevelopment. The highest ranking shall go to the household that has been residing at the site the longest period of time and so forth;

Page 3 ends

Meeting Date: September 17, 2019

6. Income qualified households displaced from any recently (within the past 2 years) demolished multi-family building in the City or households that are living in and will be displaced or evicted for the purpose of redevelopment of the property in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment. If more than one household falls into this category, such households shall be ranked in order based on the amount of time that the household has resided at the site of redevelopment. The highest ranking shall go to the household that has been residing at the site the longest period of time;

7. Income qualified households with at least one member who is a senior that does not fit the above categories;

8. Income qualified households that do not fit into the above categories.

PUBLIC OUTREACH AND NOTIFICATION
Notice of this hearing was published in the Beverly Hills Courier on August 16, 2019, and the Beverly Hills Weekly on August 29, 201 9, and courtesy notices were emailed to interested parties.

ENVIRONMENTAL ASSESSMENT
This Ordinance has been assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. The adoption and implementation of the Ordinance appears to be eligible for a class 5 categorical exemption for minor changes in land use limitations and the Ordinance could be found to not have a significant environmental impact. Further, it can be seen with certainty that there is no possibility that the adoption and implementation of the Ordinance could have a significant effect on the environment. Staff recommends that the City Council find that this Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 15305 of Title 14 of the California Code of Regulations and Section 15061(b)(3) of Title 14 of the California Code of Regulations.

FISCAL IMPACTS
There are no fiscal impacts associated with the adoption or implementation of this Ordinance.

Page4of5
Meeting Date: September 17, 2019

ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING BEVERLY HILLS MUNICIPAL CODE §10-3-1528 PERTAINING TO THE OCCUPANCY PRIORITY FOR AFFORDABLE HOUSING UNITS BUILT IN THE CITY PURSUANT TO THE CITY’S RESIDENTIAL DENSITY BONUS REGULATIONS” be introduced and read by title only.

Susan Healy Keene, AICP
Director of Community Development

Page 5 ends

Attachment I
Ordinance
ORDINANCE NO. 19-0-
AN ORDINANCE Of THE CITY Of BEVERLY HILLS

AMENDING BEVERLY HILLS MUNICIPAL CODE SECTION
10-3-1528 PERTAINING TO THE OCCUPANCY PRIORITY

FOR AFFORDABLE HOUSING UNITS BUILT IN THE CITY
PURSUANT TO THE CITY’S RESIDENTIAL DENSITY
BONUS REGULATIONS.

THE CITY COUNCIL Of THE CITY Of BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. On October 12, 2017, the Planning Commission held a duly noticed public hearing after which it adopted Resolution No. 1824, recommending that the City Council amend portions of Title 10 (Planning and Zoning) of the Beverly Hills Municipal Code to refine the occupancy priority list for affordable housing units built in the City pursuant to the City’s Density Bonus regulations (collectively, the “Amendments”). On September 10, 2019, the City Council held a duly noticed public hearing, received public testimony, and directed staff to incorporate certain revisions. The Ordinance was thereafter introduced on September 17, 2019.

Section 2. This Ordinance and the Amendments were assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. The adoption and implementation of the Ordinance represents minor changes in land use limitations and it can be seen with certainty that there is no possibility that the adoption and implementation of the Ordinance could have a significant effect on the environment. Therefore, the City Council finds that the Ordinance is eligible for a class 5 categorical exemption for minor changes in land use limitations pursuant to Section 15305 of Title 14 of the California Code of Regulations and the —1—
B0785-0001\2332878v5.doc
Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 1506l(b)(3) of Title 14 of the California Code of Regulations.

Section 3. The Amendments are consistent with the objectives, principles, and standards of the General Plan. General Plan Policy H3 “Fair Housing and Special Needs Residents” calls for the promotion of equal housing opportunities for all residents including Beverly Hills’ special needs populations. Included in this Goal is Policy H3.2 “Senior Housing” that calls for support of a provision of a variety of housing options for seniors to foster independence and the ability of seniors to remain in the community as they age.

Section 4. The City Council hereby amends Section 10-3-1528 of Article 15.2 of Chapter 3 of Title 10 of the Beverly Hills Municipal Code to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

Occupancy priority for eligible units shall conform to the following eight tiers.

A. Tier 1 - Senior Tenants Displaced from the Project Site: First priority shall go to income qualified households in which at least one member is a senior (62 years and older) and that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units, then the order in which the units are offered to Tier 1 applicants shall be based on the period of time that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to any Tier 1 applicants having the same period of residency at the project site. -2-
BO785OOO1\233287$v5.doc
B. Tier 2 - Tenants With Beverly Hills Unified School District Students Displaced from the Project Site: Second priority shall go to income qualified households that include as part of the household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower, and that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. Ifthe number of qualified applicants in this tier exceeds the number of available units, the order in which the units are offered to Tier 2 applicants shall be based on the period of time that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to any Tier 2 applicants having the same period of residency at the project site.

C. Tier 3 —Tenants Displaced from the Project Site: Third priority shall go to income qualified households that have been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units the order in which the units are offered to Tier 3 applicants shall be based on the period of time that longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to Tier 3 applicants having the same period of residency at the project site.

D. Tier 4— Displaced Senior Households: fourth priority shall go to income qualified households in which at least one member is a senior (62 years and older) and that have or -3-
B0785-0001\2332878v5.doc
will be displaced or evicted from a multi-family building in the City other than the project site for the purpose of redevelopment if either: (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due or (2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements remain valid and have not expired on the date the applications for the affordable housing units are due. Ifthe number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 4 applicants shall be based on the period of time that the longest tenured members of the household resided at the multi-family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 4 applicants having the same period of residency at the project site.

E. Tier 5 - Displaced Tenants With Beverly Hills Unified School District Students:

Fifth priority shall go to income qualified households that include as part of the household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower, and that have or will be displaced or evicted from a multi-family building in the City other than the project site for the purpose of redevelopment if either: (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due or (2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements, -4-
B0785-0001\2332878v5doc
remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 5 applicants shall be based on the period oftime that the longest tenured member ofthe household resided at the multi family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 5 applicants having the same period ofresidency at the project site.

F. Tier 6 — Displaced Households: Sixth priority shall go to income qualified households displaced from a multi-family building in the City that have or will be displaced or evicted from a multi-family building in the City other than the project site for the purpose ofredevelopment if either (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due or (2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements, remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, the order in which the units are offered to Tier 6 applicants shall be based on the period oftime that the longest tenured member ofthe household resided at the multi family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 6 applicants having the same period of residency at the project site. -5-
BO785OOO1\2332878v5,doc
G. Tier 7— Senior Households: Income qualified households with at least one member who is a senior (62 years and older). If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 7 applicants.

H. Tier 8 — Other Income Qualified Households: Income qualified households that do not meet the requirements of Tiers 1-7. If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 8 applicants.

I. Exceptions:

L In the event that a density bonus is granted for specific tenants pursuant to State Density Bonus Law (California Government Code § 65915 (b)(1)(E)) then the tiered list provided in this section shall not be used to fill the affordable housing units.

2. In the implementation of these priorities, the City shall in no way discriminate against any person or family due to disability.”
Section 5. Severability. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this Ordinance or the application thereof to any person or place, is for any reason held to be invalid or unconstitutional by the final decision of any court of competent jurisdiction, the remainder of this Ordinance shall be and remain in full force and effect.

Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (3 1st) day after its passage.

Adopted:

Effective:

ATTEST:

HUMA AHMED
City Clerk
(SEAL)
JOHN A. MIRISCH
Mayor ofthe City of
Beverly Hills, California
APPROVED AS TO FORM:
lI-/
LAURENCE S. WIENER
City Attorney
APPROVED AS TO CONTENT:

GEORGE CHAVEZ
City Manager

SAN HEAL KEEN
Director of Community Development
-7-
80785-0001\2332878v5doc
Attachment 2
Redlined Ordinance Showing Changes
Since September 10, 2019 City Council
Meeting
ORDINANCE NO. 19-0-
AN ORDINANCE Of THE CITY Of BEVERLY HILLSAMENDING BEVERLY HILLS MUNICIPAL CODE SECTION 10-3-1528 PERTAINING TO THE OCCUPANCY PRIORITY
FOR AFFORDABLE HOUSING UNITS BUILT IN THE CITYPURSUANT TO THE CITY’S RESIDENTIAL DENSITYBONUS REGULATIONS.

THE CITY COUNCIL Of THE CITY Of BEVERLY HILLS HEREBY ORDAINS AS FOLLOWS:

Section 1. On October 12, 2017, the Planning Commission held a duly noticed public hearing after which it adopted Resolution No. 1824, recommending that the City Council amend portions of Title 10 (Planning and Zoning) of the Beverly Hills Municipal Code to refine the occupancy priority list for affordable housing units built in the City pursuant to the City’s DensityBonus regulations (collectively, the “Amendments”). On September 10, 2019, the City Council held a duly noticed public hearing, received public testimony, and directed staff to incorporate certain revisions. The Ordinance was thereafter introduced this Ordinance.on September 17. 2019.

Section 2. This Ordinance and the Amendments were assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. The adoption andimplementation of the Ordinance represents minor changes in land use limitations and it can beseen with certainty that there is no possibility that the adoption and implementation of theOrdinance could have a significant effect on the environment. Therefore, the City Council finds that the Ordinance is eligible for a class 5 categorical exemption for minor changes in land use limitations pursuant to Section 15305 of Title 14 of the California Code of Regulations and the —1—
BO785-OOO1\2332878v3-5doc
Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 15061(b)(3) of Title 14 of the California Code of Regulations.

Section 3. The Amendments are consistent with the objectives, principles, and standards of the General Plan. General Plan Policy H3 “Fair Housing and Special NeedsResidents” calls for the promotion of equal housing opportunities for aB residents including Beverly Hills’ special needs populations. Included in this Goal is Policy H3.2 “Senior Housing” that calls for support of a provision of a variety of housing options for seniors to foster independence and the ability ofseniors to remain in the community as they age.

Section 4. The City Council hereby amends Section 10-3-1528 of Article 15.2 of Chapter 3 of Title 10 of the Beverly Hills Municipal Code to read as follows:
“10-3-1528: OCCUPANCY PRIORITY:

Occupancy priority for eligible units shall conform to the following si*cighi tiers.

B. Tier 2 - Tenants With Beverly Hills Unified School District Students Displaced from the Project Site: Second priority shall go to income qualified households that include as part of the household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower. and that have been or will be required to vacate existing dwelling units on the site of development so that anowner or developer may perform any construction. renovation or addition pursuant to a density bonus permit. Ifthe number of Qualified applicants in this tier exceeds the numberof available units, the order in which the units are offered to Tier 2 applicants shall be based on the period of time that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to any Tier 2 applicants having the same period of residency at the project site.
cTier 23 —Tenants Displaced from the Project Site: So4Third priority shall go to income qualified households that afehave been or will be required to vacate existing dwelling units on the site of development so that an owner or developer may perfonn anyconstruction, renovation or addition pursuant to a density bonus permit. If the number of qualified applicants in this tier exceeds the number of available units-4h the order in which the units are offered to Tier 3 applicants shall be based on the period oftime that the longest tenured member of the household resided at the project site, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units -3-
BO785-OOO1\2332878v3-5doc
are offered to the displaced qualified tenant householdTier 3 applicants having the same period ofresidency at the project site.GD. Tier 3— Displaced Senior Households: IncorneFourth priority shall go to income qualified households in which at least one member is a senior (62 years and older) and that have been displaced from anyor will be displaced or evicted from a multi-family buildingin the City other than the project site for the purpose of redevelopment if either (1) the multi-family building in the City that was demolished for redevelopment within the pasttwo years fr&nimmediately preceding the date on which applications for the affordable housing units are due or that are living in a(2) the multi-family property in the City thattQ be redeveloped has received all entitlements, excluding building permits, to redevelop the site in a manner thatand such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units, thenthe order in which the units are offered to Tier 4 applicants shall be based on the period oftime that the longest tenured members of the household resided at the multi-family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the qualified displaced senior householdTier 4 applicants having the same period ofresidency at the project site.

DE. Tier 45 - Displaced Tenants With Beverly Hills Unified School District Students:Fifth priority shall go to income qualified households that include as part ofthe household a legal guardian of one or more students currently enrolled in and attending the Beverly Hills Unified School District in grade 10 or lower, and that have or will be displaced or -4-
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evicted from a multi-family building in the City other than the project site for the purpose of redevelopment if either (1) the multi-family building was demolished for redevelopment within the two years immediately preceding the date on which applications for the affordable housing units are due or (2) the multi-family property to be redeveloped has received all entitlements, excluding building permits, and such redevelopment requires all residents to vacate the site, provided that such entitlements, or subsequent entitlements. remain valid and have not expired on the date the applications for the affordable housing units are due. If the number of qualified applicants in this tier exceed the number of available units. the order in which the units are offered to Tier 5 applicants shall be based on the period oftime that the longest tenured member ofthe household resided at the multi family building to be redeveloped, from longest to shortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the Tier 5 applicants having the same period of residency at the project site.EF. Tier 6 — Displaced Households: IncorneSixth priority shall go to income qualified households displaced from a multi-family building in the City that was demolished withinthe pasthave or will be displaced or evicted from a multi-family building in the City other than the project site for the purpose ofredevelopment if either (1) the multi-family buildingwas demolished for redevelopment within the two years froiimmediately preceding the date on which the-applications for the affordable housing units are due or that are living in a(2) the multi-family property in the City thatto be redeveloped has received all entitlements, excluding building permits, to redevelop the site in a manner that and such redevelopment requires all residents to vacate the site, provided that the—such_entitlements or subsequent entitlements, remain valid and have not expired on the date thapplications -5-
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for the affordable housing units are due. If the number of qualified applicants in this tier exceedsexceed the number of available units, thenthe order in which the units are offered to Tier 6 applicants shall be based on the period of time that the longest tenured member of the household resided at the multi-family building to be redeveloped, from longest toshortest, and a lottery shall be held within this tier to determine the order in which the units are offered to the qualified displaced householdTier 6 applicants having the same period ofresidency at the project site.

EG. Tier -7 — Senior Households: Income qualified households with at least onemember who is a senior (62 years and older). If the number of qualified applicants in thistier exceeds the number of available units, then a lottery shall be held within this tier to detennine the order in which the units are offered to the qualified senior householdTier 7 applicants.

EH. Tier 6 — Other Income Qualified Households: Income qualified households that do not meet the requirements of Tiers l-&L If the number of qualified applicants in this tier exceeds the number of available units, then a lottery shall be held within this tier to detenTline the order in which the units are offered to the qualified householdTier $applicants. @1. Exceptions:

1. In the event that a density bonus is granted for specific tenants pursuant to State Density Bonus Law (California Government Code § 65915 (b)(l)(E)) then the tiered listprovided in this section shall not be used to fill the affordable housing units. -6-
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Section 6. Publication. The City Clerk shall cause this Ordinance to be published at least once in a newspaper of general circulation published and circulated in the City within fifleen (15) days afier its passage in accordance with Section 36933 ofthe Government Code, shall certify to the adoption of this Ordinance, and shall cause this Ordinance and his certification, together with proof of publication, to be entered in the Book of Ordinances of the Council ofthis City. -7-
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Section 7. Effective Date. This Ordinance shall go into effect and be in full force and effect at 12:01 a.m. on the thirty-first (3 1st) day after its passage.

Adopted:

Effective:

JOHN A. MIRISCH
Mayor of the City of
Beverly Hills, California
ATTEST:

HUMA ARMED
City Clerk
APPROVED AS TO FORM: APPROVED AS TO CONTENT:

LAURENCE S. WIENER GEORGE CHAVEZ
City Attorney City Manager

SUSAN REALY KEENE
Director of Community Development
-8-
BO785-OOO1\2332878v3-5.doc
Document comparison by Workshare 9.5 on Friday, September 13, 2019 7:39:39 AM
Input:Document 1 ID interwovenSite://RWGDM1/RWGIMAN1/2332878/3 . . #2332878v3<RWGIMAN1> - [Clean] FINAL Affordable Description . Housing_Priority_List Ordinance Document 2 ID interwovenSite://RWGDM1/RWGI MAN 1/2332878/5 #2332878v5<RWGIMAN 1> -Revised Fl NAL Affordable
Description Housing Priority List Ordinance for 9-17-19 Council Meeting
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Attachment 3
September 10, 2019 City Council Staff
Report
Meeting Date:

Item Number:

To:

From:

Subject:

Attachments:

E— 1

AGENDA REPORT
September 10, 2019
Honorable Mayor & City Council
Susan Healy Keene, AICP, Director of Community Development Timothea Tway, AICP, Senior Planner

AN ORDINANCE OF THE CITY OF BEVERLY HILLS AMENDING
BEVERLY HILLS MUNICIPAL CODE SECTION 10-3-1528

PERTAINING TO THE OCCUPANCY PRIORITY FOR AFFORDABLE
HOUSING UNITS BUILT IN THE CITY PURSUANT TO THE CITY’S
RESIDENTIAL DENSITY BONUS REGULATIONS.

1. Ordinance

2. Planning Commission Resolution

3. October 12, 2017 Planning Commission Staff Report

4. Public Comments

5. Redlined Ordinance Showing Changes Since Planning
Commission Consideration
Pursuant to the Planning Commission’s review and recommendations, staff recommends that the City Council move to waive the full reading of the ordinance and that the ordinance entitled “AN

In 2005 the City Council adopted Ordinance No. 05-0-2482 establishing regulations for residential Density Bonus projects in the City of Beverly Hills, consistent with a mandate to implement State

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RECOMMENDATION

BACKGROUND
Meeting Date: September 10, 2019
Density Bonus law. The language in Ordinance 05-0-2482 also established an occupancy priority methodology for individuals and families to be placed in affordable housing units that are built in the City pursuant to Residential Density Bonus regulations (BHMC Article 15.2). It is important to note that the occupancy priority list in the BHMC provides a priority order to place households that are income qualified for the units that are being filled. This means that first, a household will be vetted to ensure that they meet the income qualifications of the unit for which they are applying based on the approved income level of the designated unit (for example, very low income, low income, or moderate income). Once a household is determined to meet the basic income qualification standard, then the priority list is used to rank all of the income qualified households.

The existing priority list is codified in the Municipal Code in § 10-3-1528 as follows:
10-3-1528: OCCUPANCY PRIORITY:

A. Displaced Tenants: If tenants are required to vacate existing dwelling units so that an owner or developer may perform any construction, renovation or addition pursuant to a density bonus permit, then each tenant shall be given a right of first refusal to occupy any unit for which the tenant qualifies in the newly constructed or renovated building. Tenants shall be offered the units in the following priority:

1. Households in which at least one member is sixty two (62) years of age or older;

2. Households with the lowest annual income.

2. Households with the lowest annual income;

3. All other qualified households.

2. Households with the lowest annual income;

3. All other qualified households
Since the occupancy order was established, staff has identified a number of issues with the existing occupancy priority and conducted a study session with the Planning Commission on May

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Meeting Date: September 10, 2019
25, 2017. The issues identified include:

The priority list unnecessarily separates low/very low income units and moderate income units and defines low/very low income units as being for tent only, with moderate income units as being for sale only, which does not accurately capture the situations that can occur and does not align with current State law.
• Some categories included in the list, such as sworn firefighters, law enforcement officers, and certified teachers, would be unlikely to meet the State mandated income limits for placement in affordable housing in the City.
• As currently written the list results in the individual/family with the lowest income in any particular qualifying category as automatically receiving occupancy priority. A more equitable way of structuring the list would be for qualifying individuals within any qualifying category to be eligible for a lottery within that category. Addressing this issue could be more equitable and may disincentivize manipulation of income levels reported on applications to achieve the lowest income within a specific category. • Several Councilmembers and Commissioners expressed interest in incentivizing affordable housing for seniors and addressing the need to provide housing options for those that may be displaced during the development of new housing projects. The current list does not adequately address these priorities.

In order to clarify the occupancy priority list, and bring it in line with priorities expressed by Councilmembers and Commissioners, staff recommended that the list be changed to the following:

1. First priority - Seniors (62 years and older) who are/or will be displaced from the site of development;

2. Second priority -Anyone else who is or will be displaced from the site of development;

3. Third priority -Seniors (62 years and older) displaced from any recently (within the past 2 years) demolished multi-family building in the City or are living in a multi-family property in the City that has recently (within the past 2 years) received entitlements for redevelopment;

5. Fifth priority -Seniors that have not been displaced by a project;

6. Sixth priority - Permanently disabled individuals

7. Seventh priority - Income qualified individuals that do not fit into the above categories.

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Meeting Date: September 10, 2019
May 25, 2017 Planning Commission Discussion
During the May 25, 2017 Planning Commission meeting both the Planning Commission and members of the public provided staff with comments related to the revised priority list. In general, the Planning Commission was supportive of the changes recommended by staff. Several of the Commissioners and the public requested more information on a number of policy issues. In order to address the comments made by the Commission and public, staff conducted research on the relevant topic areas by consulting Federal, State, and other municipality regulations. Staff also consulted with the City Attorney regarding the legality of suggested revisions. These policy issues and the resulting discussion are outlined in the October 12, 2017 Planning Commission staff report, which is included as Attachment 3 to this report.

Some of the comments provided during the May 25, 2017, Planning Commission meeting resulted in changes that were ultimately represented in the draft Ordinance (Attachment 1).

October 12, 2017 Planning Commission Discussion
Staff returned to the October 12, 2017 Planning Commission meeting to discuss the policy issues raised by the Planning Commission further and bring forward a resolution and draft ordinance that reflected the Planning Commission direction. The Planning Commission unanimously recommended the changes to the City Council.

Work Since 2017
Since the October 12, 2017 meeting staff has been working with a consultant to amend the Beverly Hills Affordable Housing Guidelines”, a document that supplements the code section that is the topic of this report, was approved by the City Council in 2016, and further details the process that governs the rental and sale of affordable units in the City. The effort to update this document was initiated in order to address the anticipated change in the occupancy priority for affordable units and was further informed by the process of renting affordable units at the City’s first completed density bonus project located on Burton Way (late 2017/early 2018). This work on the guidelines document is still underway and is expected to be completed in the next several months.

In the meantime, staff has received indication from the developer of the 8600 Wilshire Boulevard project that the building will be completed soon and the affordable units in the building will be ready for tenants in the next several months. Staff believes it is in the City’s best interest to have the revised occupancy priority list in place prior to the rental of these units, as the new list is more in line with goals that the City has previously discussed. For this reason staff is bringing forward the ordinance at this time and will bring forward the amended Affordable Housing Guidelines document at a later date.

Through consultation with the City Attorney’s Office, several minor changes are being proposed to the draft ordinance that the Planning Commission considered. These changes are meant to provide clarification and do not materially change the ordinance that was reviewed by the Planning Commission. One of these changes clarifies that, in order to qualify as a displaced household, a household must have been displaced from a multi-family building within the past two years from the date on which applications for the affordable housing units in question are due, as opposed to two years from when “the affordable units become available”. This provides a more concrete date to applicants and staff than the language that was presented to the Planning Commission, as it is possible that there will not be a concrete date for which the units would become available, even at the time that one applies for the unit. A redlined version of the ordinance is provided in Attachment 5 for consideration.

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Meeting Date: September 10, 2019

ANALYSIS
Draft Ordinance
The draft ordinance provides six clearly defined tiers of households that should be prioritized for affordable housing built pursuant to the City’s Density Bonus regulations. The goal of the revised priority list is to remove ambiguity or misinterpretation over who qualifies as eligible for Density Bonus affordable housing units. Staff also believes that the proposed list captures a more accurate pool of income qualified individuals and prioritizes households that reflect the goals of the community by placing displaced households and senior households as higher priority groups on the priority list. Additionally, the proposed list is not an income based ranking system and would instead operate as a lottery system within each tier. This change is recommended as a more equitable method of distributing affordable housing that would have less potential to be manipulated in the application process.

As proposed the draft ordinance helps meet General Plan Policy H3.2 “Senior Housing” that calls for support of a provision of a variety of housing options for seniors to foster independence and the ability of seniors to remain in the community as they age and Policy H3.4 “Housing Accessibility,” which encourages the addressing of housing for persons with disabilities.

It is important to note that individuals/families in each tier would still need to be income qualified to be eligible for placement in an affordable unit. Under the new priority list, individuals/families qualifying in a given tier would be eligible to be randomly selected through a lottery for occupancy priority within the tier. The proposed tiered system outlined in the draft ordinance achieves several goals that are in line with policies included in the City of Beverly Hills General Plan and is more consistent with comments that have been made recently about housing needs in the City.

The tiers recommended in the attached draft ordinance are as follows:

1. Income qualified households in which at least one member is a senior (62 years and older) who are/or will be displaced from the site of development;

2. Income qualified households that are or will be displaced from the site of development;

5. Income qualified households with at least one member who is a senior that does not fit the above categories;

6. Income qualified households that do not fit into the above categories.

Implementation of Ordinance
It should be noted that the occupancy priority is the method through which the City places eligible households in affordable units when they are available. When affordable units are advertised as

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Beverly Hills City CouncilOctober 10, 2024

Beverly Hills City Council
October 10, 2024