Carmel-by-the-Sea City Council
November 4, 2025

Chapter 2.0 – Goals, Policies, and Programs 2-13
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 village. The City will require that the water rights associated with the converted hotels stay with the property–i.e., once the property is converted into mixed-income multifamily housing through the program.
 Increased development potential. The City will grant a modest increase in FAR on hotel sites that are converted into mixed-income multifamily housing through the program.  Hotel residential suites (HRS). The City will explore the possibility of allowing purchasers of hotel keys to designate a subset of the newly established hotel rooms as “hotel residential suites” – hybrid units that would be owner-occupied as market rate residential suites for a portion of the year and that would be required to be added to the hotel inventory for the rest of the year. The ability to sell these hotel residential suites would help to expand the universe of potential hotel key purchasers to include existing hotel owners (as opposed to just ownership groups newly acquiring hotels) by providing a near-term opportunity to recoup the capital invested to purchase the hotel keys and construct the new hotel rooms. These hotel residential suites are not included in the Sites Inventory or towards the City’s RHNA.  Qualified projects will benefit from streamlined review, expedited permitting, and reduced permit fees.

Program Benefits
By unlocking the value associated with the limited number of hotel keys available in the City, the program will offer property owners an above market rate of return, which will encourage widespread participation and significantly increase the likelihood of generating a substantial number of new housing units.

With its focus on the conversion of small, scattered site hotel properties, the program will integrate affordable housing into the physical and social fabric of the village.

The program is mixed-income at the property level, and is designed to create housing units for Above Moderate (i.e., market rate), Moderate, Low, and Very Low income households.

By creating an investment opportunity with a return on investment that is substantially higher than what the market would typically offer, the City can explore ways to divert resources from these transactions to other affordable housing programs with less financial viability.

The Hotel residential suites created through this program have the potential to help stem the tide of population loss by providing an alternative to the purchase of a single-family residence as a second home, many of which remain vacant for much of the year, and which would be better utilized as homes for permanent residents. Hotel residential suites would offer prospective second home buyers an alternative that would be dramatically less expensive and that would offer a number of other benefits:
e.g., lower maintenance requirements, enhanced security, easy access to restaurants and shops in the downtown area, and shared amenities.

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Chapter 2.0 – Goals, Policies, and Programs 2-14
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The same number of overnight visitor accommodating rooms to serve coastal visitor access in the City will be retained while increasing the amount of multifamily housing in the village.

The transfer of hotel keys from underperforming hotels to upgraded hotel rooms at new or existing hotels will dramatically increase the City’s transient occupancy tax (TOT) revenue.

Program 1.1.G – Hotel Employee Housing Program - AFFH
Quantified Objective: 5 Affordable Units (not included in RHNA capacity) Timeframe: Amend the Carmel Municipal Code by June 2027 Responsible Party: Community Planning and Building Department Funding Source: General Fund
The City has a number of overnight visitor accommodation properties (motels, hotels, inns) that would benefit from incorporating affordable on-site employee housing. These units would alleviate the current lack of housing many Carmel hospitality employees face. Therefore, the City will create a voluntary program to incentivize the generation of on-site employee housing at hotels, motels, and inns around the village. These potential units are not used to meet the City’s RHNA adequate sites requirements.

If the owner of an overnight visitor serving accommodation converts one or more legal guestrooms into a deed restricted affordable employee unit, the City will grant the owner the legal right to replace the hotel room on-site, sell the “hotel key”, or transfer it to another site, similar to Program 1.1.F, the Hotel-to-Residential Conversion (Hotel ‘Key’ Transfer) Program.

As noted above, Carmel’s General Plan caps the number of hotel rooms permitted to operate in the city (948 rooms as of Jan 1, 2025.) This cap is currently exceeded, meaning no additional rooms can be built in the City. This program leverages the scarcity of hotel rooms created by the General Plan cap to incentivize the development of affordable rental housing and offset the loss of revenues for participating hotel owners–all while maintaining visitor-serving coastal access. Qualifying projects may also be eligible for priority access to water allocations, expedited review, and reduced permit fees.

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Chapter 2.0 – Goals, Policies, and Programs 2-15
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 1.1.H: Accessory Dwelling Units - AFFH
Quantified Objective: 7 Extremely Low, 14 Very Low, 21 Low, 21 Moderate, 7 Above Moderate Income Units
Timeframe: December 2025 to December 2031
Monitor and report to the City Council the City’s progress in facilitating ADU production annually. Based on results of the monitoring, if by June 2028 the City is not trending to meet its established objectives for this program, the City will modify the program and/or utilize alternative strategies within six months to ensure that the City could fully accommodate its RHNA.

Responsible Party: Community Planning and Building Department Funding Source: General Fund
Issues and Opportunities
The City’s ADU ordinance was last updated in 2017 (Ord. 2017-10 §1 (Exh. A), 2017). Carmel-by-theSea is currently following the requirements of state law in the review and approval of ADUs and JADUs. The City is in the process of updating its ADU Ordinance to incorporate state laws that have expanded since 2017, and to clarify the ADU permitting process for property owners.

Program Description
The City recognizes that ADUs provide affordable housing options for family members, seniors, students, in-home health care providers, couples, small families, and friends. ADUs can also be useful to generate additional rental income for the homeowner. The City also recognizes that there are many misconceptions surrounding development regulations and water restrictions for ADUs. For example, it is not widely known that ADUs do not need a new water meter, or that the Monterey Peninsula Water Management District (MPWMD) does not charge a service connection fee for an ADU. To help combat this lack of public knowledge, the City maintains a dedicated housing webpage that includes the California Department of Housing and Community Development Accessory Dwelling Unit Handbook and that serves as a source of technical assistance to property owners.

To facilitate ADU development the City will complete the following actions between 2024 and 2031:
 The City will complete revisions to its local ADU Ordinance and incorporate guidance from the recent Senate Bill 1077 (December 2026).
 As new relevant state laws are adopted during the planning cycle, the City will amend the Carmel Municipal Code in a timely manner to reflect applicable changes in the law.  The City will develop a process for reviewing plans submitted for pre-approval pursuant to AB 1332 (2023). (June 2026)
 The City will develop a procedure for the review and approval of unpermitted ADUs pursuant to AB 2533 (2024) also known as the amnesty program. (June 2026) ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-16
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  The City will pursue implementing a pre-sales inspection program to identify unpermitted ADUs and refer them to the amnesty program. (December 2027)  If the program is determined to be feasible, establish a program within six months. (June 2028)
 The City will establish a renter match program for ADUs. (December 2029)  The program may also employ a citywide survey of ADU rental rates to help connect tenants with property owners charging more affordable rates.  Outreach activities will include promoting ADU availability to local workers.  The City will promote affordability and increase workforce housing by developing a program to incentivize homeowners to create ADUs that are affordable to, and occupied by, lower income households. One incentive could be providing the necessary water credits to serve the ADU. Other incentives would also be explored during the development of the program. (December 2026)
 The City will conduct outreach and education on an ongoing basis, including but not limited to the following efforts: holding community workshops, promoting the Property Owners Guide to Building an ADU (prepared by the AHA community group in coordination with the City of Carmel) and updating it as needed, maintaining a dedicated webpage on the City’s website with information on ADUs, conducting outreach and providing education to local architects andrealtors, and sending educational information through the mail to property owners about working with the City to develop ADUs, and clarifying common misconceptions about water availability.

Program Benefits
 Legalize unpermitted ADUs to ensure they meet minimum health and safety regulations.  Provide affordable housing options for the local workforce.  Provide additional housing options for local seniors.  Increase the proportion of ADUs that are occupied through a renter match program.  Increase the permanent housing stock.
 Encourage full-time residency within the village.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-17
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Policy 1.2: Continue to monitor and work cooperatively with regional agencies to augment infrastructure in a manner that provides adequate capacity for existing and new housing needs while preserving and improving the unique visual character of the City.

Program 1.2.A: Water Distribution Prioritization for Affordable Housing – AFFH Quantified Objective: 13 Extremely Low, 98 Very Low, 113 Low, 50 Moderate, 59 Above Moderate Income Units
Timeframe: Adopt Water Allocation Resolution by December 2025 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Historically, the greatest constraint to housing production in Carmel-by-the-Sea has been limited water resources. The City’s Regional Housing Needs Allocation (RHNA) of 349 units for the 2023-2031 planning period is estimated to require approximately 40 acre feet of water. On January 27, 2025, the Monterey Peninsula Water Management District (MPWMD) adopted Ordinance 197 allocating 14 acre feet of water to the City of Carmel-by-the-Sea. The Ordinance took effect on March 1, 2025 and the water is estimated to become available at the end of 2025 or early 2026.

Potable water is a fundamental infrastructure need for housing and has historically been a limited resource in Carmel-by-the-Sea. Water is regulated by the State Water Resources Control Board (SWRCB) and the Monterey Peninsula Water Management District (MPWMD). Few developed sites have available water credits sufficient to accommodate construction of additional residential units.

Although additional water resources are anticipated to become available in late 2025/early 2026, the current State imposed cease-and-desist order in Carmel remains in effect and California American Water (Cal-Am) is not permitted to install new water meters at this time. In an effort to address water constraints, the City will:
 Support efforts by the MPWMD to expand the water supply with new water sources that will support affordable housing development.
 Work cooperatively with MPWMD to implement water conservation methods through the building permit process (e.g., low-flow fixtures, instant hot water heaters, cisterns/rain gardens) to augment water for new development projects. The City has already received many building permit applications for remodels of older homes, which would result in water conservation.
 Update the City’s water allocations by land use in accordance with the Water Management Program (Carmel Municipal Code Chapter 17.50) to include the recent allocation from MPWMD of 14 acre feet. In establishing these allocations, the City will prioritize the allocation of water for affordable housing.

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Chapter 2.0 – Goals, Policies, and Programs 2-18
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 1.2.B: Address Infrastructure Constraints
Quantified Objective: See below in bullets
Timeframe: City’s 5-Year Capital Improvement Plan through December 2031 Responsible Party: Public Works Department
Funding Source: General Fund
Ensuring the City’s infrastructure is modernized and can accommodate future growth is a critical charge of local governments. The City’s infrastructure is continuously aging, with deferred maintenance still remaining from the COVID Pandemic. Crafting capital improvement programs to effectively address this maintenance backlog and manage the City’s infrastructure into the future is imperative. The City’s Public Works Department continues to improve City infrastructure, including roads and storm drains, through the City’s 5-Year Capital Improvement Plan process. The City will continue to work cooperatively with outside agencies, including the Pacific Gas and Electric Company (PG&E), the Carmel Area Wastewater District (CAWD), and California American Water (Cal-AM), to continue to maintain and upgrade the City’s infrastructure.

The City of Carmel proposes the following actions and timeline to address infrastructure constraints during the 6th Cycle.
 The City of Carmel, whenever possible, will collaborate with and support the undergrounding of electrical wires by PG&E in an effort to provide consistent power. The City is working with PG&E to develop an undergrounding plan, with the work estimated to be complete within 10-15 years for a small portion of the City. With a desire to underground the remainder of overhead electrical wires in the next 20-30 years, the City will continue to work with PG&E to develop a long term plan.

Quantified Objective: Underground a small portion of the electrical wires by December 2034, and work with PG&E to underground the remainder over the next 20-30 years)  The City will implement drainage and street improvements, including ADA ramps and sidewalk slope improvements through the 5-year Capital Improvement Plan.

Quantified Objective: The City will invest $2.334 million in drainage improvements and $4.969 million in street improvements by December 2026) ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-19
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Policy 1.3: Reduce or eliminate governmental constraints on the provision of affordable housing. Direct public funding resources to the conservation of existing housing units in neighborhoods where continued residential use is appropriate.

Program 1.3.A: Condominium Conversions
Quantified Objective: N/A
Timeframe: Continued ordinance implementation through December 2031 Responsible Party: Community Planning and Building Department Funding Source: General Fund
The City will continue to implement the condominium conversion ordinance, which restricts the conversion of apartments to condominiums to preserve lower-cost rental housing options (i.e., apartments) within the City. Apartments cannot be converted to condominiums unless a new apartment is being created to offset the conversion.

Program 1.3.B: Employee Housing - AFFH
Quantified Objective: N/A
Timeframe: Adoption of Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
As stated in Appendix A there is no farmwork or agricultural employment in Carmel-by-the-Sea.

Accordingly, the City has not identified a need for specialized farmworker housing beyond overall programs for housing affordability.

In compliance with the Employee Housing Act (Health and Safety Code §17000 et seq.) Sections 17021.5 and 17021.6, the City of Carmel-by-the-Sea will amend the Carmel Municipal Code to include a definition for employee housing that permits employee housing for six or fewer employees to be treated as a single-family structure and permitted in the same manner as other dwellings of the same type in the same zone.

Program 1.3.C: Manufactured Homes on a Foundation System Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
The City currently permits manufactured homes on a foundation system on lots zoned for conventional single-family residential dwellings pursuant to California Government Code §65852.3. Manufactured homes represent an affordable and cost-effective form of housing. The City will amend the Carmel Municipal Code to include manufactured homes as a permitted use in the R-1 zoning district subject to the same development standards to which a conventional single-family residential dwelling on the same lot would be subject.

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Chapter 2.0 – Goals, Policies, and Programs 2-20
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 1.3.D: Senate Bill 35 and Senate Bill 423 Processing Procedure Quantified Objective: N/A
Timeframe: Adopt a procedure by December 2026
Responsible Party: Community Planning and Building Department Funding Source: General Fund
According to Senate Bill (SB) 35 (2017), jurisdictions that have insufficient progress toward their lowerincome RHNA units must employ a streamlined ministerial approval process for proposed developments with at least 50 percent affordability. Early implementation of SB 35 did not apply to cities in the coastal zone. However, in October 2023, SB 423 was signed into law, expanding SB 35 measures to include cities located in the coastal zone and extending the operation of the streamlined ministerial approval process to January 1, 2036.

In compliance with SB 35 and SB 423, the City will establish a standard procedure for processing eligible development projects.

Program 1.3.E: Emergency Shelters
Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
In compliance with AB 2339 (2022), the City will amend Title 17 of the Carmel Municipal Code to define emergency shelters and clearly state they are a permitted use by-right, requiring no discretionary review in the CC, SC, and RC commercial districts.

California Government Code §65583 requires the identification of one or more zoning designations that allow residential uses, including mixed uses, where emergency shelters are allowed as a permitted use without a conditional use or other discretionary permit and that are suitable for residential uses.

The Carmel Municipal Code includes emergency shelters within the definition of Community Social Service Facilities and reads as follows: “Any noncommercial housing facility, such as homeless shelters or emergency shelters, which may also provide meals, showers, and/or laundry facilities. Specialized programs and services related to the needs of the residents may also be provided. This classification excludes transitional housing facilities that provide long-term living accommodations.” Carmel Municipal Code Chapter 17.14, Commercial Zoning Districts, Schedule II-B: Commercial Districts - Use Regulations, includes Community Social Service Facility as a permitted use in the Central Commercial (CC), Service Commercial (SC), and Residential and Limited Commercial (RC) Districts.

Pursuant to Subparagraph (G) of §65583, a local government with an existing ordinance or ordinances that comply with this paragraph shall not be required to take additional action to identify zoning designations for emergency shelters. The housing element must only describe how existing ordinances, policies, and standards are consistent with the requirements of this paragraph.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-21
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The City does not currently have objective standards that govern the operation and management of emergency shelters such as the maximum number of beds or persons to be permitted to be served nightly by the facility, sufficient parking to accommodate all staff working at the shelter, size and location of intake areas, provision of onsite management, proximity to other emergency shelters, length of stay, lighting, and security during the hours the shelter is in operation.

The City will amend the Carmel Municipal Code to create objective operational standards for emergency shelters.

Program 1.3.F: Forest and Beach Commission Required Findings Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Carmel Municipal Code §17.48.070, Findings Required for Significant Trees prohibits the removal of significant trees to facilitate construction or development unless one of the two following findings is met:

1. That removal of the tree is required to protect public health or safety; or

2. That the following four conditions exist:
a. The existing site is vacant or is developed to an extent less than one-third of the base floor area allowed by the zoning applicable to the site; and b. The available land area of the site not occupied by significant trees (including land within six feet of the trunk of significant trees) does not adequately and practically provide space for development of at least one-third of the base floor area allowed by the zoning for the site; and
c. The issuance of a variance for development in one or more setbacks has been considered and would not provide a remedy or would be inappropriate due to a significant overriding inconsistency with another policy or ordinance of the LCP; and d. Failure to authorize removal of the tree(s) would deprive the owner of all reasonable economic use of the property.

The findings in 2.a and 2.b have been identified as a potential constraint to the development of multifamily housing. The City will review the findings to ensure they do not impede multifamily development in the commercial and multifamily districts.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-22
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Policy 1.4: Improve Development Review and Approval Processes Program 1.4.A: Modify or Eliminate Onerous Use Permits - AFFH Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2028 Responsible Party: Community Development Department
Funding Source: General Fund
Multifamily and duplex housing units constitute approximately 13 percent of Carmel’s housing stock.

The use permit (UP) (AKA conditional use permit (CUP)) requirement is implemented as an additional regulatory tool and adds extra regulations, review, and required findings, to a variety of development standards that affect multifamily development. Carmel Municipal Code Chapter 17.64 Findings Required for Permits and Approvals includes a broad list of applicable conditional uses and incentives.

There are opportunities to reduce redundancies and facilitate residential construction while still enabling development to meet City regulations.

To address this potential constraint to the development of multifamily residential units, the City will pursue replacing subjective language in the required findings for Use Permits with objective findings, or eliminating these Use Permits altogether.

Program 1.4.B: Objective Design and Development Standards - AFFH Quantified Objective: N/A
Timeframe: Adopt Objective Design Guidelines by June 2027 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Carmel Municipal Code Chapter 17.58, Design Review describes a discretionary review process for the construction of new buildings and additions to existing buildings in the commercial districts.

There are three findings for approval: 1) Conformance to the applicable policies of the General Plan and the Local Coastal Program; 2) Compliance with all applicable provisions of the Municipal Code; and 3) Consistency with the applicable adopted design review guidelines.

In November 2023, the City received an $85,000 REAP 2.0 Local Suballocation Grant, which will be used to pursue the creation and adoption of Objective Design and Development Standards (ODDS) to reduce governmental constraints presently limiting the production of multifamily housing. The City's expectation, and desired intent, is that having ODDS in place will incentivize and accelerate the construction of qualifying affordable multifamily housing projects in the City's downtown area, including the Central Commercial (CC), Service Commercial (SC), Residential & Limited Commercial (RC), and Multifamily Residential (R-4) Districts.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-23
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 1.4.C: By-Right Approval - AFFH
Quantified Objective: N/A
Timeframe: Amend the Municipal Code to comply with state by-right requirements by December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Pursuant to Government Code §65583.2(h)(i) (AB 1397 passed in 2017), the City will amend the Carmel Municipal Code to require by-right approval without discretionary review for a housing development that includes 20 percent of the units as affordable to lower income households, applicable to the following types of sites:
 Vacant sites being used to meet the RHNA adequate sites requirements that represent a “reuse” of sites identified in two or more previous and consecutive Housing Element cycles.  Nonvacant sites being used to meet the RHNA adequate sites requirements that represent a “reuse” of sites identified in the previous cycle of Housing Element.  Sites being redesignated/rezoned after the statutory deadline of the Housing Element to accommodate the RHNA shortfall. By-right approval of these sites would be triggered by the rezoning.

For the 6th Cycle Housing Element, the City does not anticipate the need to rezone sites or utilize any sites that may be considered reuse sites to meet its RHNA. “By-right” means a jurisdiction shall not require:
 A Conditional Use Permit;
 A Planned Unit Development Permit;
 Design review, other than Objective Development Design Standards; or  Other discretionary, local government review or approval that would constitute a “project” as defined in Section 2100 of the Public Resources Code (California Environmental Quality Act “CEQA”)
ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-24
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Goal H2 Protect Affordable Housing and Improve the Housing Stock Policy 2.1: Maintain and encourage expansion of permanent residential housing stock in the Residential and Commercial Districts.

Program 2.1.A: Incentives for Mixed-Use Development - AFFH Quantified Objective: Five Moderate Income units (accounted for under Program 1.1.B and Program 1.1.D.)
Timeframe: Adopt Municipal Code amendments by June 2028 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Providing additional development capacity of any type increases project feasibility. In order to better incentivize affordable residential development, the City will amend the Municipal Code to increase the floor area bonuses from 0.15 to up to 0.25 for projects in the CC, SC, and RC Districts that include housing for Moderate, Low, or Very-Low-income households. The City will also distribute informational materials promoting the floor area bonus and other applicable incentives.

Program 2.1.B: Permanent Housing - AFFH
Quantified Objective: N/A
Timeframe: Continued ordinance implementation through December 2031 Responsible Party: Community Planning & Building Department/City Administrator Funding Source: General Fund
Short-term rentals can provide valuable coastal visitor-serving access; however, units used as short-term rentals preclude the establishment of permanent housing. The City also has a significant percentage of the housing stock that remains vacant for part of the year due to second home ownership. This creates a significant barrier for current and potential residents to enter the local housing market and further limits opportunities to correct the housing crisis, address diversity, and provide inclusive housing options.

The City’s ordinance prohibiting short-term, transient rentals, fractional ownership, and timeshares of residential dwellings in the R-1 District and allowing a limited number of short-term rentals in the commercial areas has successfully limited the proliferation of these uses. The City will continue to implement these ordinances. In an effort to address the high rate of second home ownership, the City will promote Accessory Dwelling Units and Junior Accessory Dwelling Units (see Program 1.1.G) to add affordable rental units on properties that may otherwise lie vacant, and will establish an Affordable Housing Trust Fund (see Program 2.1.D).

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-25
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 2.1.C: Monitor Affordable Housing Stock - AFFH
Quantified Objective: Monitor 50 lower income units
Timeframe: Develop a program by June 2026
Responsible Party: Community Planning and Building Department Funding Source: General Fund
The City will develop a City-managed Affordable Housing Oversight Program and continue to monitor affordable housing projects and work with the owners to preserve affordability through identification of funding sources and/or opportunities for partnerships with other housing providers. The program will formalize annual monitoring of the affordable housing stock throughout the city to ensure affordable housing is being protected and provided as required by California Government Code Section 65590. This may also include partnering with a qualified entity, like The Carmel Foundation, that already actively manages, monitors, and provides reporting for affordable housing units in the City. The City will update its databases to better track data on new construction, demolition, conversion, and replacement of housing units for Lower- and Moderate-income households including the following indicators:
 The number of new housing units approved for construction;  The number of Lower- and Moderate-income housing units required to be provided in new housing developments;
 The number of existing residential dwelling units occupied by Lower- and Moderate-income households that have been authorized to be demolished or converted; and  The number of Lower- and Moderate-income housing units required to be replaced (of those units being demolished or converted).

Additionally, in compliance with AB 1397, the City will adopt a policy to require replacement housing units subject to the requirements of Government Code §65915, subdivision (c)(3) when any new housing development project occurs on a site meeting the any of the following conditions:

1. The site currently has residential uses or within the past five years has had residential uses that have been vacated or demolished;

2. The site was subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of Low or Very Low-income; or

3. The site is subject to any other form of rent or price control through a public entity’s valid exercise of its police power, or is occupied by Low or Very Low-income households.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-26
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 2.1.D: Establish Affordable Housing Trust Fund - AFFH Quantified Objective: $1 million
Timeframe: Establish a Fund by December 2026
Responsible Party: City Administrator
Funding Source: General Fund
The City currently relies on outside agencies and organizations to fund affordable housing projects.

However, in an effort to establish a City-funded source dedicated to supporting the creation, maintenance, and rehabilitation of affordable units, the City will pursue the creation of an Affordable Housing Trust Fund. The Trust would be funded by the City, either through a dedicated revenue source or via the General Fund.

Policy 2.2: Preserve and protect the scale of established neighborhoods while encouraging property improvement
Program 2.2.A: Historic Preservation Educational Programs Quantified Objective: 25 referrals/materials distributed annually Timeframe: Continued education and ordinance implementation through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Cities have unique characteristics that develop over time. Carmel-by-the-Sea has a distinctive design tradition and form that existing residents cherish and that serves to attract new residents and visitors. In an effort to continue to encourage improvements to the existing housing stock, the City will continue to promote education programs that improve public understanding of the City’s rich cultural and design heritage, and provide zoning flexibility and incentives to facilitate rehabilitation of historic resources.

The City will continue to use the Historic Building Code to facilitate residential rehabilitation of historic residences.

Policy 2.3: Preserve and expand affordable and rental housing opportunities to enable local employees to live in the community where they work.

Program 2.3.A: Preserve and Increase Upper Floor Residential Uses - AFFH Quantified Objective: These units are accounted for under Program 1.1.B (Development on Small Sites), Program 1.1.C (Live/Work Housing), and Program 1.1.D (Mixed-Income Incentives Program)
Timeframe: Proactive outreach through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
The retail and office landscape is shifting and the City continues to experience retail and office vacancies. This shift represents an opportunity to increase the supply of housing as a preferred development form in all Commercial Districts. The City currently prohibits the conversion of existing second-floor residential units to commercial use and requires all newly constructed second-floor space ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-27
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 to be used as residential units. Housing over first-floor commercial uses is a particularly suitable solution for underutilized second-floor space. Therefore, the City will proactively work with property owners to encourage the conversion of vacant or underutilized upper floors to residential use.

Policy 2.4: Preserve the existing housing stock
Program 2.4.A: Housing Rehabilitation and Maintenance Information - AFFH Quantified Objective: 25 referrals/materials distributed annually Timeframe: Proactive outreach through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
To stay habitable and energy efficient, all buildings need maintenance. When buildings fall into an extreme state of disrepair, a more comprehensive rehabilitation is needed. Over the past few years, inflation and building supply chain issues have dramatically increased the cost of building materials.

Labor costs have also risen significantly due to a shortage of skilled construction workers and ongoing cost-of-living increases. This results in very costly rehabilitation projects.

In order to assist low-income property owners, the City will distribute information on inspection services, housing rehabilitation programs, and alternative ways to finance home repairs. Based on Code Compliance reports, the City will specifically monitor and conduct outreach to owners of residential units in need of rehabilitation and maintenance throughout the city with a focus on the southern region of the city.

Goal H3 Provide Opportunities for New Affordable and Other Special Needs Housing
Policy 3.1: Incentivize affordable housing development, with an emphasis on affordable housing built to accommodate Extremely-Low and Low-income residents.

Encourage the private sector to produce affordable housing.

Program 3.1.A: Mixed-Use Affordable Housing - AFFH
Quantified Objective: 10 Low Income Units
Timeframe: Proactive outreach through December 2031; Revise guidelines and approval processes by June 2028
Responsible Party: Community Planning and Building Department Funding Source: General Fund
The shifting retail and office landscape represents an opportunity to encourage mixed-use developments (housing over first-floor commercial uses) as a preferred development form via community outreach. The City will proactively work with property owners, property managers, and realtors to promote and incentivize upper-floor housing opportunities, including the potential of allowing a third-floor mezzanine for affordable housing. Such development would be subject to the City’s 30-foot height limit.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-28
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The City has identified the following regional affordable housing organizations to include in the discussion of revising design guidelines to promote mixed-use affordable housing in the City.  County of Monterey Housing Authority Development Corporation (HDC);  Woodman Development Company, Inc.;
 Community Housing Improvement Systems and Planning Association, Inc. (CHISPA);  Eden Housing;
 EAH Housing; and
 Mid-Peninsula Housing.

Based on the feedback received by City Staff from the development community, the City will implement the following actions:
 Revise design guidelines based on community and developer feedback;  Revise approval processes if constraints are identified during feedback gathering; and  Annually host outreach and FAQ forums for developers and community members.

Program 3.1.B: Housing for Extremely-Low Income Households - AFFH Quantified Objective: 2 Extremely Low Income Units
Timeframe: Outreach efforts ongoing through December 2031 Responsible Party: Planning and Building Department
Funding Source: General Fund
Providing housing units for Extremely-Low Income (ELI) Households earning 30 percent or less of the Area Median Income (AMI) for Monterey County has proved challenging for the City. The City will continue to place specific emphasis on the provision of multifamily housing and non-traditional housing types such as single-room-occupancy units and transitional housing. The City will encourage development of housing for ELI households through a variety of activities such as targeted outreach to for-profit and non-profit housing developers on at least an annual basis, providing in-kind technical assistance, fee deferrals, expedited/priority processing, identifying grant and funding opportunities, applying for or supporting applications for funding on an ongoing basis, reviewing and prioritizing local funding for developments that include housing for ELI households, and/or offering additional incentives to supplement the density bonus provisions in state law.

The City also has a variety of programs to encourage development of ELI units, including Accessory Dwelling Units–a portion of which are designed to provide affordable housing for Extremely-Low Income Households–and employee housing. The City has also funded a full-time permanent Associate Planner position through the General Fund to focus on long-range planning and housing needs.

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Chapter 2.0 – Goals, Policies, and Programs 2-29
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 3.1.C: Density Bonus - AFFH
Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by December 2031 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Density bonuses can provide a significant incentive to build affordable housing units. By increasing the number of units permitted to be built on a property, the financial investment required to bring the development to fruition has a higher likelihood of seeing a positive return. Given the high cost of materials, labor, and borrowing costs, increasing the number of units can make the housing project financially feasible.

Pursuant to Government Code §§65915-65918, the City will amend the City’s Density Bonus provisions to be consistent with recent changes to State Density Bonus Law. Additionally, the City will further review and revise local bonus density ordinances to clarify the regulations and increase certainty of applicability.

Program 3.1.D: Reduced Entitlement and Development Fees - AFFH Quantified Objective: Reduced fees for developments with affordable units Timeframe: Adopt a Fee Schedule by July 2026
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Entitlement and development fees paid by project applicants assist in the City’s ability to recover administrative and operating costs; however, these fees may have the unintended consequence of increasing the cost of housing. To encourage the development of affordable housing, the City will reduce the planning and building permit fees for affordable housing units in commercial areas.

Program 3.1.E: Reduced Parking Requirements - AFFH
Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Carmel Municipal Code Chapter 17.38, Off-Street Parking Requirements, Table A: Minimum Parking Requirements provides parking factors for land uses by zoning district. In the Central Commercial (CC), Service Commercial (SC), Residential and Limited Commercial (RC) and Multi-Family Residential (R-4) districts, the parking requirement for affordable housing is one-half space per unit. For senior housing, it is one-third space per unit plus 1 guest space for every 4 units. Other permanent residential uses are required to provide 1 parking space per unit in the SC District, and 1.5 spaces in the RC and R4 Districts. No parking is required in the CC District.

The City recognizes that parking requirements increase the cost of residential development and take up valuable space that can be used for housing, and has maintained a low parking ratio for residential uses.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-30
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The City will continue to offer reduced parking requirements for affordable housing developments.

Additionally, the City will clarify that affordable units are exempt from parking in-lieu fees.

Program 3.1.F: Expedited Processing Procedures - AFFH
Quantified Objective: N/A
Timeframe: Hire a consultant by December 2026; Adopt Municipal Code amendments by June 2027
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Faster permit processing times reduce overall project timelines and allow a project to get to the construction stage in a timely manner.

To enable a more efficient permit processing system, the City is committed to contracting with a qualified consultant to review the Planning Division’s current permitting procedures to identify inefficiencies and make recommendations on process improvements to streamline the permitting process. Based on the consultant’s recommendations, the City will update existing permitting procedures, including, but not limited
to, the following:
 Implement concurrent permit processing for projects that incorporate several land uses or features that would typically require two or more permit applications, to be concurrently reviewed and approved or disapproved by the highest-level review authority or joint meetings. This will expedite the review process for complex development projects.  Allow an option for affordable multifamily projects to utilize 3-D modeling or other comparable methods, in lieu of story poles, that provide objective information for the City to assess impacts of development on important coastal scenic view resources.  Prioritize projects with affordable units, assign a dedicated planner to facilitate the development process, and schedule joint public hearings when multiple decision-making bodies are involved.

Program 3.1.G: Establish Minimum Densities - AFFH
Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2028 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Establishing a minimum density can be utilized as a tool to ensure the limited available land in a City is used in an efficient manner and lower densities are avoided. The City’s intention for establishing a minimum density in the Commercial and Multi-Family Residential Districts is rooted in enabling the development of more dense housing in the City. Currently, the Commercial District (CC, SC, and RC) permits residential densities of 0-22 dwelling units per acre and the Multi-Family Residential District ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-31
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 (R-4) permits a maximum of 33 dwelling units per acre. Establishing a minimum density in these districts will result in higher yields of residential units. Recent residential developments in the City’s Commercial District have ranged in density from 22-33 dwelling units per acre. The City will revise the Municipal Code for commercial districts (CC, SC and RC) and the Multifamily Residential (R-4) District to establish a minimum density of 22 dwelling units per acre, as part of the base zoning and a maximum allowable density of 40 units per acre, with a total maximum capacity of 88 units per acre, inclusive of all local and State density bonuses. Additionally, the City will prohibit new single-family development in the R-4, CC, SC, and RC Districts. Existing single-family dwellings in these districts will be considered legal nonconforming uses. Recognizing that there is a need for housing to accommodate families, and to try and increase the mix of housing types, the City will pursue options for incentivizing the development of two- and three-bedroom units.

The City is committed to modifying development standards in the commercial and multi-family districts to ensure the standards support the minimum density and do not function as a constraint to meeting the minimum density, as necessary.

Policy 3.2: Recognize the special needs of persons with disabilities and the need to retain flexibility in the design review process to accommodate these needs.

Program 3.2.A: Reasonable Accommodation Procedures - AFFH Quantified Objective: Process 8 applications
Timeframe: Adopt a revised policy and Municipal Code amendment by December 2025
Responsible Party: Community Planning and Building Department Funding Source: General Fund
A reasonable accommodation is any change, exception, or adjustment to a rule, policy, practice or service that allows a person with a disability to have an equal opportunity to participate. Information on reasonable accommodation procedures will continue to be provided at City Hall and on the City’s website. As of September, 2025 the City is already underway evaluating and revising Policy C11-01, which describes procedures to provide reasonable accommodation, and has explored reduced or waived permit fees for persons with disabilities in compliance with the provisions of SB 520, in an effort to remove any additional barriers and encourage those with disabilities to apply. Initial conversations with the Planning Commission and City Council have been supportive of revising the policy. To eliminate subjectivity from the required findings for requests for reasonable accommodation, the City will amend the Municipal Code to remove the findings requirement for requested accommodations stating, “the requested accommodation will not result in a significant and unavoidable negative impact on adjacent uses or structures.” and develop a finding to allow for the reasonable accommodations that adequately addresses the need with the least intrusive impacts.

Further, the City will amend the definition of aggrieved parties and the appeal process in the Municipal Code, to ensure that appeals of reasonable accommodation permits do not create an undue additional barrier.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-32
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 3.2.B: Housing Mobility - AFFH
Quantified Objective: 78 live/work units (Program 1.1.C); 18 mixed income units (Program

1.1.D); 65 units on religious properties (Program 1.1.E); and 161 units through Hotel to Residential Conversion (Program 1.1.F); 5 hotel employee housing (Program 1.1.G); and 70 ADUs (Program 1.1.H) Timeframe: December 2027
Responsible Party: Community Planning and Building Department Funding Source: General Plan
The City of Carmel-by-the-Sea is committed to promoting a diverse array of housing options for all income groups throughout the community. To improve housing mobility and promote more housing choices and affordability, the City will employ a suite of strategies to create and/or enhance opportunities in various neighborhoods, including in lower density neighborhoods and in downtown Carmel. This initiative represents an effort to increase housing mobility, and extends beyond programs to meet the City's RHNA. Actions and strategies are detailed in individual programs above and include:
 Homesharing: Research and pursue a homesharing program, including coordination with non-profits and other organizations to assist with matching tenants with existing homeowners. Typically, homesharing is a service provided by nonprofit organizations to assist in matching a homeowner with a tenant. This homesharing process can also include helping homeowners rent out their ADUs. The process of identifying and screening potential tenants, developing lease agreements, and understanding the rights and responsibilities of being a landlord can be onerous. The City may facilitate presentations at The Carmel Foundation Senior Center, and other outreach assistance. The City will market and take other actions as necessary, at least annually, with the goal of generating five opportunities per year.  Program 1.1.C: Live/Work Housing
 Program 1.1.D: Mixed-Income Incentive Program
 Program 1.1.E: Affordable Housing on Religious Facility Properties  Program 1.1.F: Hotels to Residential Development
 Program 1.1.G: Hotel Employee Housing
 Program 1.1.H: Accessory dwelling units (ADUs)
 Marketing of housing resources and opportunities: Provide housing resources and information available through various City and regional in-person and virtual outlets. The City will provide this information in multiple languages based on the languages spoken by Carmel-by-the-Sea residents, as indicated in the U.S. Census Bureau's American Community Survey.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-33
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 3.2.C: Family Friendly Housing – AFFH
Quantified Objective: 5 Very Low, 5 Low, 5 Moderate Income Units Timeframe: Develop Regulatory Incentive (June 2028); Implement Family Friendly Design Guidelines (June 2028)
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Carmel-by-the-Sea is suffering from a rapid and accelerating decline in the number of families with children living within the village. Between 2012 and 2023, the number of students from Carmel-by-theSea attending Carmel River School (the local public elementary school) declined from 270 to 129.

Similarly, from 2016 to 2024, the number of students from Carmel-by-the-Sea attending Carmel Middle School and Carmel High School declined from 53 to 27 and from 90 to 47, respectively. Overall, between 2015 and 2024 the median age of residents increased from 53 to 65.

To counter this trend, the City will promote multifamily housing designs to attract households with children and larger multi-generational households by encouraging developers to include unit mixes with higher bedroom counts (including four-bedroom units) as well as other family friendly features and onsite amenities, such as usable outdoor open space for multigenerational use, and multipurpose rooms that can be used for after-school homework clubs, computer, art, or other resident activities. To boost the number of families with children residing in the village and to address potential displacement of households with four or more persons, the City will create incentives to encourage the development of larger units with multiple bedrooms.

Policy 3.3: Facilitate the provision of transitional and supportive housing in appropriate districts in the community.

Program 3.3.A: Zoning for Transitional and Supportive Housing – AFFH Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Senate Bill (SB) 2 (2007) revised Housing Element law requiring that transitional and supportive housing be permitted as a residential use, subject only to restrictions that apply to other residential dwellings of the same type in the same zone. In compliance with SB 2, the City will continue to allow transitional/supportive housing as a residential use. The City’s Municipal Code permits transitional and supportive housing by-right in all districts that permit residential uses, including the CC, SC, RC and R-4 Districts, regardless of the number of persons in the facility.

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Chapter 2.0 – Goals, Policies, and Programs 2-34
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Program 3.3.B: Low-Barrier Navigation Centers – AFFH
Quantified Objective: N/A
Timeframe: Adopt Municipal Code amendments by June 2026 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Assembly Bill (AB) 101 (2019) provides a pathway to permanent housing for people experiencing homelessness. A “Low Barrier Navigation Center” is a housing first, low-barrier, service-enriched shelter focused on moving people into permanent housing. The shelter provides temporary living facilities while case managers connect individuals experiencing homelessness to income, public benefits, health services, shelter, and housing. In order to comply with state law, the City will amend the Municipal Code to include the definition of a “Low Barrier Navigation Center” and will develop By Right procedures for processing low barrier navigation centers.

Program 3.3.C: Unlicensed Residential Care Facilities – AFFH Quantified Objective: N/A
Timeframe: Adopt Municipal Code Amendments by June 2026 Responsible Agency: Community Planning and Building Department Funding Source: General Fund
State law requires local governments to treat licensed residential care facilities (e.g. group homes) with six or fewer residents as a residential use and subject to the same development standards as a singlefamily dwelling. Furthermore, no conditional use permit, variance, or other zoning clearance shall be required of a residential care facility that serves six or fewer persons that is not also required of a singlefamily dwelling of the same type in the same zone. The residents and operators of a residential care facility shall be considered a family for the purposes of any law or zoning ordinance that relates to the residential use of a property. However, “six or fewer persons” does not include the operator, the operator’s family, or persons employed as staff. These facilities are licensed and regulated by the State of California.

The City defines Residential Care Facilities as facilities that require or are licensed by the State of California to provide living accommodations and 24-hour, primarily nonmedical care and supervision for persons in need of personal services, supervision, protection, or assistance. Living accommodations are shared living quarters with or without separate kitchens or bathrooms for each room or unit. This classification includes facilities that are operated for profit as well as those operated by public or nonprofit institutions.

Residential Care, General. A residential care facility providing 24-hour nonmedical care for more than six persons in need of personal services, supervision, protection, or assistance. This classification includes hospices, board and care homes, and similar establishments that are licensed by the State of California. These types of facilities are conditionally permitted in the SC and RC Districts.

Residential Care, Limited. A residential care facility providing 24-hour nonmedical care for six or fewer persons in need of personal services, supervision, protection, or assistance essential for sustaining ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-35
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 the activities of daily living. This classification includes only those facilities licensed for residential care by the State of California. These types of facilities are subject to the same regulations as apply to other family residential dwellings in the CC, SC, and RC Districts. In the R-1 District, they are permitted in single-family homes. In the R-4 District, they are permitted by-right with no restrictions.

Residential Care, Senior. A residential care facility providing 24-hour medical or nonmedical care for more than six persons 60 years of age or older in need of personal services, supervision, protection, or assistance for sustaining the activities of daily living. This classification includes nursing homes for the elderly, life care or continuing care homes, and similar facilities licensed for residential care by the State of California. These types of facilities are conditionally permitted in the SC, RC, and R-4 Districts.

Recognizing that larger facilities provide necessary supportive environments for a variety of households, the City will amend the Zoning Ordinance to conditionally permit unlicensed facilities of seven or more persons in all zones that allow similar residential uses.

Program 3.3.D: Single Room Occupancy (SRO) Units – AFFH Quantified Objective: N/A
Timeframe: Adopt Municipal Code Amendments by June 2026 Responsible Party: Community Planning & Building Department Funding Source: General Fund
Government Code §65583 and §65583.2 require that a city plan for a variety of housing types, including single-room occupancy units or SROs. An SRO consists of a single room dwelling unit that is the primary residence of its occupant(s). One example of an SRO could be the proposed Live/Work units in Program 1.1.C. To support the creation of SROs, the City will take the following actions:
 Adopt a definition of “single room occupancy unit” in the Carmel Municipal Code.  Amend the Carmel Municipal Code to identify the districts where SROs would be permitted as a residential use subject only to those regulations that apply to other residential dwellings of the same type in the same zone. The City may adopt specific, objective development standards applicable to SROs such as maximum number of occupants, minimum or maximum unit size, and requirements relating to food preparation facilities, and sanitation facilities.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-36
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Goal H4 Exemplify Sustainable Development and Energy Conservation Policy 4.1: Support energy and water conservation programs to reduce the consumption of these resources in housing and to reduce housing costs.

Program 4.1.A: Water Conservation
Quantified Objective: 25 referrals/materials distributed annually Timeframe: Implement the water management program through December 2031 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Even with a recent allocation of water from the Monterey Peninsula Water Management District (MPWMD), potable water remains a finite, and tightly regulated resource in the City and California at large. To responsibly allocate the City’s limited water allocation to maximize as many new residential units as possible, the City will continue to implement the Water Management Program (Carmel Municipal Code Chapter 17.50) through the building permit process, and provide information to the community on water conservation retrofits and best practices. In addition, the City will provide information on and promote water conservation education through outreach and community engagement, and retrofit rebates provided by the MPWMD.

Program 4.1.B: Energy Conservation and Green Building
Quantified Objective: 25 referrals/materials distributed annually Timeframe: Continued education and compliance through December 2031 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Conserving energy to reduce stress on the electrical grid and reduce the effects of climate change (i.e. wildfire and flooding) is increasingly critical. The City experienced significant power outages during the 2022-23 winter storms, adjacent areas were flooded, and the past few wildfire seasons have significantly impacted air quality and resulted in evacuations of neighboring communities. The City will continue to review applications for new construction and substantial alterations, taking into consideration solar orientation and access to sunlight. The City will also continue to require compliance with current state building standards for energy efficiency in all new homes. The City will further disseminate information by updating the website annually with related energy conservation and green building information.

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Chapter 2.0 – Goals, Policies, and Programs 2-37
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Goal H5 Publicize Housing Needs and Resources
Policy 5.1: Support and enforce fair housing laws. Expand fair housing choice by promoting housing opportunities and removing impediments to fair housing.

Program 5.1.A: Fair Housing Services – AFFH
Quantified Objective: 25 referrals/materials distributed annually Timeframe: Proactive outreach through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
The Fair Housing Act protects people from discrimination when they are renting or buying a home, getting a mortgage, seeking housing assistance, or engaging in other housing-related activities. The California Department of Fair Employment and Housing and the Conflict Resolution and Mediation Center of Monterey County provide fair housing services and information. These agencies advise persons in need of information on housing and employment, mediate landlord/tenant disputes and research complaints about discriminatory housing practices. The City will coordinate with these agencies to provide printed information about fair housing services at City Hall, on the City’s website, and in other public buildings such as the City’s two libraries. The City will also refer inquiries related to fair housing to these agencies and provide fair housing resources at outreach events.

Program 5.1.B: Housing Choice Voucher Program – AFFH
Quantified Objective: 25 referrals/materials distributed annually Timeframe: Proactive outreach through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Created by the Housing and Community Development Act of 1978, the Housing Choice Voucher program, formerly known as Section 8, provides assistance to eligible Low- and Moderate-Income families to rent housing in the private market. Eligibility for this program is based on the family’s gross annual income and family size. The Housing Choice Voucher rental assistance program is administered by the Housing Authority of the County of Monterey. The City will continue to facilitate use of the Housing Choice Voucher program in the community by distributing information for the program at City Hall and the Library and making referrals to the Housing Authority.

Program 5.1.C: Shared Housing Information – AFFH
Quantified Objective: 25 referrals/materials distributed annually Timeframe: Proactive outreach through December 2031
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Shared housing is another important tool to provide affordable housing options. Shared housing is generally more affordable because a portion of a residence is rented as opposed to an entire unit.

Shared housing can provide safe and secure affordable housing in a high-cost market. This model can also financially help low-income individuals who own their homes, while alleviating loneliness. The City ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-38
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 will continue to distribute informational materials from the Housing Authority of the County of Monterey and The Carmel Foundation, and will display information at City Hall, other public buildings, and on the City’s website. The City will also seek out other shared housing providers and resources to expand this housing option.

Program 5.1.D: Farmworker Housing – AFFH
Quantified Objective: N/A
Timeframe: Ongoing
Responsible Party: Community Planning and Building Department Funding Source: General Fund
Although the City does not have agricultural uses, and therefore, no housing designated specifically for farmworkers, the City supports the County of Monterey’s efforts to educate the public on resources that are available for agricultural workers. The City has identified the following resources that are available throughout the region for agricultural employees:
 Spanish Farmworkers Resource Line – provides information on a variety of resources such as legal help and medication services, stress management, support for farmworkers with disabilities.
 The Center for Community Advocacy – an organization whose mission is to support and build leadership within the community and in particular for farmworkers and their families. The Center has worked side by side with farmworkers to help improve their living conditions and advocate for more affordable housing and access to health services and resources.  Farm and Food Worker Relief Program – Catholic Charities Diocese Monterey is providing direct financial relief to eligible farmworkers in the counties of Monterey, Santa Cruz, San Benito, and San Luis Obispo. The purpose of this program is to provide direct financial relief to eligible field workers, meatpacking workers, livestock workers, and grocery store workers.

Policy 5.2: Promote public awareness and foster pride in the history of the village.

Program 5.2.A: Support Community Organizations – AFFH
Quantified Objective: N/A
Timeframe: Proactive outreach and partnerships through December 2031 Responsible Party: Community Planning and Building Department Funding Source: General Fund
Community organizations play a pivotal role to provide outreach and services to those facing housing issues. The City will continue to support community organizations that promote neighborhood involvement, including but not limited to the Carmel Residents Association, The Carmel Foundation, and the Carmel Heritage Society. The City will develop partnerships with these organizations to promote neighborhood enhancement programs, conduct and improve outreach and education, and solicit community input.

ATTACHMENT 3

Chapter 2.0 – Goals, Policies, and Programs 2-39
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025

2.5 Summary of Quantified Objectives
Table 2-1 - Quantified Objectives (2023-2031)
Program
Extremely
Low Very Low Low Moderate
Above
Moderate Total

1.1.A: Adequate Sites 113 74 44 118 349

1.1.B: Development on Small Sites 2 2 2 12 18

1.1.C: Live/Work housing 8 35 35 78

1.1.E: Affordable Housing on Religious
Facility Properties
6 29 30 65

1.1.F: Hotel-to-Residential Conversion 40 40 40 41 161

1.1.G: Hotel Employee Housing 5 5

1.1.H: Accessory Dwelling Units 7 14 21 21 7 70

1.2.A: Water Distribution Prioritization for
Affordable Housing
13 98 113 50 59 333

3.1.A: Mixed Use Affordable Housing 10 10

3.1.B: Housing for Extremely Low Income
Households
2 2
ATTACHMENT 3

Housing Needs and
Fair Housing Report
A

APPENDIX
ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-ii Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table of Contents
Appendix A Housing Needs and Fair Housing Report ................................................................................................... A-1 A.1 Introduction ........................................................................................................................................................ A-1 A.2 Population, Employment, and Household Characteristics ........................................................................... A-7 A.3 Disproportionate Housing Needs ................................................................................................................. A-31 A.4 Special Needs Groups ..................................................................................................................................... A-40 A.5 Access to Opportunity .................................................................................................................................... A-58 A.6 Housing Stock Characteristics ....................................................................................................................... A-70 A.7 Fair Housing Enforcement and Outreach Capacity ................................................................................... A-84 A.8 Fair Housing Recommendations ................................................................................................................ A-100 A.9 Conclusion ...................................................................................................................................................... A-105 Tables
Table A-1 - Population Growth Forecast by Jurisdiction, 2015-2045 ......................................................................... A-8 Table A-2 - Population Age Distribution by Jurisdiction, 2019 ................................................................................. A-10 Table A-3 - Population by Race by Jurisdiction, 2019 ................................................................................................. A-11 Table A-4 - Employment Growth Forecast by Jurisdiction, 2015-2045 .................................................................. A-20 Table A-5 - Employment by Sector, Carmel-by-the-Sea, 2010 and 2019 ................................................................. A-21 Table A-6 - Unemployment Rate, Carmel-by-the-Sea, 2019 ...................................................................................... A-23 Table A-7 - Regional Housing Needs Allocation ......................................................................................................... A-23 Table A-8 - Occupations by Mean Salary, Monterey County, 2019 .......................................................................... A-24 Table A-9 - Housing Forecast by Jurisdiction, 2015-2045 .......................................................................................... A-25 Table A-10 - Households by Income Category, Carmel-by-the-Sea, 2019 ............................................................... A-27 Table A-11 - Overview of Special Needs Groups ........................................................................................................ A-40 Table A-12 - Extremely Low-Income Households, Carmel-by-the-Sea, 2015-2019 .............................................. A-42 Table A-13 - Disability Status by Age, Carmel-by-the-Sea, 2021 ............................................................................... A-48 Table A-14 - Population with Developmental Disabilities by Age, Carmel-by-the-Sea, 2021 .............................. A-48 Table A-15 - Population with Developmental Disabilities by Residence, Carmel-by-the-Sea, 2021 ................... A-49 Table A-16 - Homeless Population by Jurisdiction, 2017-2022 ................................................................................. A-57 Table A-17 - Homelessness by Household Type and Shelter Status, Monterey County, 2019 ............................ A-57 Table A-18 - Housing Unit Growth Trends by Jurisdiction, 2010-2019 .................................................................. A-70 Table A-19 - Housing Units by Type by Jurisdiction, 2019 ........................................................................................ A-71 Table A-20 - Housing Units by Type and Tenure, Carmel-by-the-Sea, 2019 .......................................................... A-72 Table A-21 - Household Size by Tenure by Jurisdiction, 2019 .................................................................................. A-73 Table A-22 - Vacant Housing Units by Type, Carmel-by-the-Sea, 2019 .................................................................. A-75 Table A-23 - Housing Permits by Income Group, Carmel-by-the-Sea, 2015-2021 ................................................ A-75 Table A-24 - Inventory of Assisted Rental Housing .................................................................................................... A-77 Table A-25 - Median Home Value by Jurisdiction, 2019-2022 .................................................................................. A-82 Table A-26 - Average Rent by Number of Bedrooms, Carmel-by-the-Sea, 2023 ................................................... A-82 Table A-27 - Housing Affordability, Carmel-by-the-Sea, 2022 .................................................................................. A-83 Table A-28 - Distribution of Potential Hotel- to- Residential Conversion Opportunity Sites by LMI Population (2024) ...................................................................................................................................... A-94 Table A-29 - Distribution of RHNA Units by LMI Population (2024) ................................................................... A-94 Table A-30 - Distribution of Potential Hotel- to- Residential Conversion Opportunity Sites by Cost Burdened Renters (2022) .......................................................................................................................... A-97 Table A-31 - Distribution of RHNA Units by Cost Burdened Renters (2022) ....................................................... A-97 Table A-32 - Fair Housing Issues, Contributing Factors, and AFFH Programmatic Actions ........................... A-102 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-iii Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figures
Figure A-1 - Major Public and Legal Actions that Influence Fair Access to Housing .............................................. A-3 Figure A-2 - Population Growth, Carmel-by-the-Sea, 2010-2019 ................................................................................ A-8 Figure A-3 - Population Distribution by Age, Carmel-by-the-Sea, 2010-2019 ........................................................... A-9 Figure A-4 - Population by Race Compared to the County, 2019 ............................................................................. A-10 Figure A-5 - Population by Race, Carmel-by-the-Sea, 2010-2019 ............................................................................. A-12 Figure A-6 - Regional Non-White vs. White Population, 2010-2019........................................................................ A-13 Figure A-7 - Diversity Index, Carmel-by-the-Sea, 2018 .............................................................................................. A-15 Figure A-8 - R/ECAP by Census Tract, Carmel-by-the-Sea, 2009-2013 ................................................................. A-17 Figure A-9 - RCAAs by Census Tract, Carmel-by-the-Sea, 2015-2019 .................................................................... A-18 Figure A-10 - Percent Non-White by Block Group, Carmel-by-the-Sea, 2018 ....................................................... A-19 Figure A-11 - Worker Earnings by Place of Residence and Place of Work, Carmel-by-the-Sea, 2019 ............... A-22 Figure A-12 - Household by Type by Jurisdiction, 2019 ............................................................................................. A-25 Figure A-13 - Changes in Household Type, Carmel-by-the-Sea, 2010-2019 ........................................................... A-26 Figure A-14 - Households by Household Size by Jurisdiction, 2019 ........................................................................ A-26 Figure A-15 - Median Household Income by Jurisdiction, 2019 ............................................................................... A-28 Figure A-16 - Regional Median Household Income, 2010-2019 ............................................................................... A-28 Figure A-17 - Income by Category, Carmel-by-the-Sea, 2019 .................................................................................... A-29 Figure A-18 - Median Income by Block Group, Carmel-by-the-Sea, 2015-2019 .................................................... A-30 Figure A-19 - Housing Tenure by Jurisdiction, 2019 ................................................................................................... A-31 Figure A-20 - Housing Problems by Tenure, Carmel-by-the-Sea, 2015-2019 ......................................................... A-32 Figure A-21 - Severe Housing Problems by Tenure, Carmel-by-the-Sea, 2015-2019 ............................................ A-33 Figure A-22 - Overcrowding by Severity by Jurisdiction, 2019 .................................................................................. A-34 Figure A-23 - Overcrowding by Tenure and Severity, Carmel-by-the-Sea, 2019 .................................................... A-34 Figure A-24 - Overcrowded Households, Carmel-by-the-Sea ................................................................................... A-35 Figure A-25 - Cost Burden Severity by Jurisdiction, 2015-2019 ................................................................................ A-36 Figure A-26 - Cost Burden by Tenure, Carmel-by-the-Sea, 2015-2019 .................................................................... A-37 Figure A-27 - Cost Burden by Home Owners, Carmel-by-the-Sea, 2015-2019 ...................................................... A-38 Figure A-28 - Cost Burden by Renter Households, Carmel-by-the-Sea, 2015-2019 .............................................. A-39 Figure A-29 - Percent Living Below the Poverty Line by Race and Ethnicity, Carmel-by-the-Sea, 2019 ........... A-43 Figure A-30 - Senior Population by Jurisdiction, 2019 ................................................................................................ A-44 Figure A-31 - Senior Housing by Tenure, Carmel-by-the-Sea, 2019 ......................................................................... A-45 Figure A-32 - Senior Households by Income, Carmel-by-the-Sea, 2019 .................................................................. A-45 Figure A-33 - Population by Disability Status by Jurisdiction, 2021 ......................................................................... A-47 Figure A-34 - Trends in Persons with Disabilities, Carmel-by-the-Sea, 2012-2021 ................................................ A-47 Figure A-35 - Households by Size and Tenure, Carmel-by-the-Sea, 2019 ............................................................... A-50 Figure A-36 - Single-Parent Households by Jurisdiction, 2019 .................................................................................. A-51 Figure A-37 - Trends in Single-Parent Households, Carmel-by-the-Sea, 2010-2019 ............................................. A-52 Figure A-38 - Hired Farm Labor, Monterey County, 2002-2017 .............................................................................. A-54 Figure A-39 - TCAC Opportunity Composite Score, Carmel-by-the-Sea, 2022 ..................................................... A-60 Figure A-40 - TCAC Opportunity Economic Score, Carmel-by-the-Sea, 2022 ...................................................... A-61 Figure A-41 - Jobs Proximity Index, Carmel-by-the-Sea ............................................................................................. A-63 Figure A-42 - TCAC Opportunity Education Score, Carmel-by-the-Sea, 2022 ...................................................... A-64 Figure A-43 - TCAC Opportunity Environmental Score, Carmel-by-the-Sea, 2022 ............................................. A-66 Figure A-44 - Social Vulnerability Index, Carmel-by-the-Sea, 2018 .......................................................................... A-67 Figure A-45 - Housing by Type in Carmel-by-the-Sea, 2010-2019 ........................................................................... A-71 Figure A-46 - Housing Stock by Number of Bedrooms, Carmel-by-the-Sea, 2019 ............................................... A-72 Figure A-47 - Household Tenure by Race, Carmel-by-the-Sea, 2019 ....................................................................... A-73 Figure A-48 - Vacancy Rates by Jurisdiction, 2019 ...................................................................................................... A-74 Figure A-49 - Vacancy Trends, Carmel-by-the-Sea, 2010-2019 ................................................................................. A-74 Figure A-50 - Housing Stock by Age, Carmel-by-the-Sea, 2019 ................................................................................ A-79 Figure A-51 - Displacement Risk, Carmel-by-the-Sea, 2022 ...................................................................................... A-80 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-iv Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-52 - FHEO Cases Total, Monterey County, 2020 ....................................................................................... A-86 Figure A-53 - FHEO Cases, Disability Bias, Monterey County, 2020 ...................................................................... A-87 Figure A-54 - Sites Inventory ........................................................................................................................................... A-91 Figure A-55 - Sites Inventory and Non-White Population by Block Group (2022) ............................................... A-93 Figure A-56 - Sites Inventory and LMI Population by Block Group (2024) ........................................................... A-95 Figure A-57 - Sites Inventory and Cost Burdened Renters by Tract (2022) ............................................................ A-98 Figure A-58 - Sites Inventory and Displacement Risk by Tract (2022) .................................................................... A-99 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-1
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Appendix A
Housing Needs and Fair Housing Report
A.1 Introduction
The following report provides both the City of Carmel-by-the-Sea Housing Needs Assessment and Fair Housing Assessment. This analysis primarily utilizes U.S. Census Bureau American Community Survey (ACS) 5-Year Estimate data1 and California Department of Housing and Community Development (HCD) data.

Housing Needs Assessment
The Housing Needs Assessment for the City of Carmel-by-the-Sea provides an in-depth analysis of the City’s population, employment, economics, household, and housing stock conditions and characteristics. This assessment develops context for the City’s goals, programs, and policies for the 6 th Cycle Housing Element.

Fair Housing Assessment
In 2018, Governor Brown signed Assembly Bill (AB 686) which requires departments and agencies to administer programs relating to housing in a way that affirmatively furthers fair housing (AFFH).2 As of January 1, 2019, AB 686 extends the obligation to affirmatively further fair housing to all public agencies in the State of California. This affirmative duty is not limited to those agencies with relationships with the federal government and is to be broadly applied throughout agencies at the state and local level. Now, all public agencies must both (1) administer programs and activities relating to housing and community development in a manner that affirmatively furthers fair housing, and (2) take no action inconsistent with this obligation.3 AB 686 also made changes to Housing Element Law, requiring Housing Elements and General Plans to incorporate AFFH requirements.

Such requirements include an analysis of fair housing outreach and capacity, integration and segregation, access to opportunity, disparate housing needs, and current fair housing practices. 1 The primary reason for using 2019 data is because this is the data that was primarily being used by HCD in their AFFH datasets for the majority of housing needs data, including data that is pulled from CHAS datasets which range from 2013-2019. Additionally, 2020-2021 Census data may not be representative due to the COVID-19 pandemic. Largely, the data is reported for 2019 as this aligns with the supplemental data HCD has provided and allows for consistent reporting.
2 Public agencies receiving funding from the U.S. Department of Housing and Urban Development (HUD) are also required to demonstrate their commitment to AFFH. The federal obligation stems from the fair housing component of the federal Civil Rights Act mandating federal fund recipients to take “meaningful actions” to address segregation and related barriers to fair housing choice.
3 California Department of Housing and Community Development Guidance, 2021, page 9.

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Appendix A – Housing Needs and Fair Housing Report A-2
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Affirmatively Furthering Fair Housing
“Affirmatively furthering fair housing” means taking meaningful actions, in addition to combating discrimination, that overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity based on protected characteristics.

Specifically, affirmatively furthering fair housing means taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws. The duty to affirmatively further fair housing extends to all of a public agency’s activities and programs relating to housing and community development. (Gov. Code, §8899.50, subd. (a)(1).)” Source: California Department of Housing and Community Development Guidance, 2021, page 14.

History of Segregation in the Region
The United States’ oldest cities have a history of
mandating segregated living patterns. Exclusive
zoning practices were common in the early
1900s – courts struck down only the most
discriminatory and allowed those that would be
considered today to have a “disparate impact” on
classes protected by the Fair Housing Act. For
example, the 1926 case Village of Euclid v. Amber
Realty Co. (272 U.S. 365) supported the segregation
of residential, business, and industrial uses,
justifying separation by characterizing apartment
buildings as “mere parasite(s)” with the potential
to “utterly destroy” the character and desirability
of neighborhoods. At that time, multifamily
apartments were the only housing options for people of color, including immigrants.

The Federal Fair Housing Act was not enacted until nearly 60 years after the first racial zoning ordinances appeared in U.S. cities. This coincided with a shift away from federal control over lowincome housing toward locally-tailored approaches (block grants) and market-oriented choice (Section 8 subsidies, now called Housing Choice Vouchers) – the latter of which is only effective when adequate affordable rental units are available.

Figure A-1 on the following page provides a timeline of major legal and public actions that have influenced fair access to housing beginning in 1910.

This history of segregation in the region is
important not only to understand how
residential settlement patterns came
about— but, more importantly, to explain
differences in housing opportunity
among different residents.

In sum, not all residents had equal ability
to build housing wealth.

This historically unequal playing field in
part determines structural inequities
that persist today.

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x A – Housing Needs and Fair Housing Report
y-the-Sea 6th Cycle Housing Element Amendment Update Adopted Nov A-1 - Major Public and Legal Actions that Influence Fair Access to Housing oot Policy Research
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Appendix A – Housing Needs and Fair Housing Report A-4
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Monterey County and the Monterey Bay region also have an interesting past, as far as the fight to end racial segregation is concerned. Some of the segregation in the Monterey Bay area can be attributed to historically discriminatory practices, such as racial covenants,4 redlining,5 and discriminatory mortgage approvals. While Carmel-by-the-Sea itself does not have a history of racial covenants, the City’s racial characteristics do reflect persistent “structural inequities” in society, and “self-segregation” (i.e., preferences to live near similar people).

Kent Seavey’s 2007 book Carmel: A History in Architecture details the history of Carmel-by-the-Sea, from its early settlement by Spanish explorers, to its marketing as a “seaside resort for Catholics” in the 1880s, to the development of the City’s more contemporary history and architectural design.

Similar to other jurisdictions within Monterey County, Carmel-by-the-Sea does not have a high level of diversity.

Harold and Ann Gilliam describe the history of Carmel in their 1996 book Creating Carmel, The Enduring Vision. Carmel started as an artist town, with notable writers, artists and poets Mary Austin, Sinclair Lewis, Jack London and Robinson Jeffers settling in Carmel-by-the-Sea. They were drawn to Carmelby-the-Sea for its natural beauty, a quiet town among Monterey pine forest, scenic, rocky coastline, and white sand beaches. The early small cottages of the early 1900s reflect these humble beginnings, and the evolution of Carmel’s architecture, including Comstock’s notable fairy-tale style buildings, mirrors the community of artists who resided in Carmel-by-the-Sea. As Carmel-by-the-Sea grew and became a globally known tourist destination land prices began to increase. Gilliam writes, "[a]s expensive homes have replaced Carmel’s traditional cottages, the town’s demographics have changed. The artists and writers who carried on the Sterling tradition… and the low-to-middle-income residents in the old redwood cottages, have been gradually replaced by upscale business people and professionals able to afford the fantastically escalating prices of land”. In addition to historical discriminatory practices that embedded segregated living patterns throughout the Monterey Bay area, it’s also necessary to recognize the historical impacts of colonization and genocide on Indigenous populations and how the effects of those atrocities are still being felt today. Historically, the Monterey Peninsula has been home to indigenous populations for more than 10,000 years. The original inhabitants of present-day Monterey County were the Ohlone (Costanoan), Salinan, and Esselen tribes who have “…lived in communities related by language, family, and custom.”6 However, “[d]ue to the devastating policies and practices of a succession of explorers, missionaries, settlers, and various levels of government over the centuries since European expansion, these tribes have lost the vast majority of their population as well as their land.” 7 4 Racial covenants are clauses that were inserted into property deeds to prevent people who were not White from buying or occupying land.
5 Redlining is the practice of denying credit to individuals based on race, ethnicity, or other discriminatory practices. 6 From Racial Beachhead: Diversity and Democracy in a Military Town, by Carol Lynn McKibben, 2012, Stanford University Press.
7 From Indigenous Peoples of San Mateo County. San Mateo County Office of Education.

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Appendix A – Housing Needs and Fair Housing Report A-5
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The lasting influence of these policies and practices have contributed directly to the disparate housing and economic outcomes collectively experienced by Native populations today.8 The Monterey County Weekly news outlet highlights the past and present effects of restrictive covenants, along with other housing issues such as “the lack of affordable housing, generational wealth inequities and zoning issues,” as potential contributing factors to segregation within the County.9 Though restrictive racial covenants were never enacted specifically in Carmel-by-the-Sea (unlike nearby Pebble Beach and Pacific Grove), the City’s population demographics are less diverse than other jurisdictions within Monterey County. Carmel-by-the-Sea’s General Plan and Zoning Ordinance have long emphasized single-family residential patterns and consequently, the City offers a limited variety of housing types with 87 percent single family detached units. Historically, this type of development contributed to segregation patterns in part due to higher purchase costs that accompany single-family homes. Because financing for single-family properties favored educated higher income earners, purchasing property in the City remained out of reach for many lower income households and likely contributed to the demographics seen in the City today.

Enacting policies and programs that promote
AFFH and highlight the community’s assets could
attract a broader demographic to the area, and
encourage those that work in the City to live here
as well. As reflected by the 2021 Proclamation of
the City Council of Carmel-by-the-Sea: Carmel-bythe-Sea has been and will continue to be enriched and enhanced in its cultural fabric, economic
prosperity, and personal understanding of others
by having a principled and respectful community
standard towards all people.

Overview of Carmel-by-the-Sea
Over the past 10 years, Carmel-by-the-Sea has experienced growth in both population and jobs,10 which means more housing of various types and sizes is needed to ensure that residents across all income levels, ages, and abilities have a place to call home. While the number of people drawn to the City has steadily increased, housing production has not kept pace with demand, contributing to the housing shortage in the City. The following Housing Needs and Fair Housing Assessment develops context for 8 From Systemic Inequality: Displacement, Exclusion, and Segregation, by Danyelle Solomon, et al., 2019, Center for American Progress.
9 From Ribakoff, S. (2022, November 24) A new group sets out to explore the history of racist housing covenants in Monterey County. Monterey County Weekly.
10 From AMBAG Regional Growth Forecast 2022; 2010 (population: 3,722); 2015 (population 3,854); 2020 (population:
3,949).

Carmel-by-the-Sea has been and will
continue to be enriched and enhanced in
its cultural fabric, economic prosperity
and personal understanding of others by
having a principled and respectful
community standard towards all people.

July 5, 2021
Proclamation of the City Council of Carmel-By-The-Sea
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Appendix A – Housing Needs and Fair Housing Report A-6
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 the goals, programs, and policies that Carmel-by-the-Sea will implement to address inequities in the 6th Cycle Housing Element.

Summary of Population, Employment, Household and Housing Stock Characteristics The following provides a brief overview of population, employment, household, and housing stock characteristics in Carmel-by-the-Sea. These statistics help inform the existing housing needs in Carmelby-the-Sea, as well as highlighting past trends and future forecasts to develop proactive policies and programs to address the needs of the community.
 Between 2010-2019, Carmel-by-the-Sea’s population increased by 2.8 percent.11  According to the Association of Monterey Bay Area Governments (AMBAG) 2022 Regional Growth Forecast, Carmel-by-the-Sea, the population is forecast to grow by approximately three (3) percent between 2015 to 2045.
 In 2019, the predominant age group was individuals between 65 to 74 years of age.  In 2019, the population was comprised of the following racial and ethnic groups: nonHispanic White individuals (86.5 percent), Hispanic or Latino (8.2 percent), Asian populations (5.2 percent), and Black or African American (0.1 percent).  According to the AMBAG 2022 Regional Growth Forecast, Carmel-by-the-Sea is projected to experience an employment growth of 17 percent (562 new jobs) between 2015-2045.  In 2019, the unemployment rate was 0.1 percent; approximately 5 percent less than the County.
 According to the AMBAG 2022 Regional Growth Forecast, Carmel-by-the-Sea is forecast to have a household growth of approximately one (1) percent by 2045 – an increase of 42 housing units.
 In 2019, the largest household type was married-couple family households (47 percent) single-person households (40 percent), female-headed households (6 percent), Other nonfamily households (5 percent), and male-headed households (2 percent).  In 2019, above moderate-income households made up the majority of households in the City (62 percent) followed by lower-income households (28 percent), and moderate-income households (10 percent).
 In 2019, the housing stock was predominantly occupied by owner households (57 percent), compared to renter households (43 percent).
 In 2019, the majority of households (94 percent) do not experience overcrowding. Six (6) percent of households in Carmel-by-the-Sea are severely overcrowded and zero percent are moderately overcrowded.
 In 2019, 23 percent of households are cost burdened and 23 percent are severely cost burdened.
 The 2015-2019 Comprehensive Housing Affordability Strategy (CHAS) data indicates there were approximately 310 extremely low- and very low-income households living in Carmelby-the-Sea. There are approximately 140 extremely low-income households in Carmel-by11 From U.S. Census Bureau, ACS 5-Year Estimate, 2010-2019 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-7
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 the-Sea, 100 of which are owner-occupied households and 40 extremely low-income renteroccupied households.  In 2019, senior households makeup 43 percent of all households; 15 percent of seniors rent their homes.
 In 2019, 12 percent of people in Carmel-by-the-Sea have a disability of some kind.  In 2019, Carmel-by-the-Sea had 70 large households, of which 57 percent are renteroccupied households. Renter-occupied households makeup the majority of all 3-5+ person households.
 In 2019, female-headed family households comprised 75 percent of single-parent households and male-headed households accounted for 25 percent. No single-parent households fell below the poverty level.
 The number of households experiencing homelessness has decreased between 2017 to 2022 from 16 persons to one (1), respectively.
 In 2019, Carmel-by-the-Sea had 3,832 housing units, an approximate 6 percent increase from the 3,606 units that existed in 2010.
 Between 2015 and 2022, 18 housing units were issued permits in Carmel-by-the-Sea which represents 58 percent of the RHNA number of 31 units assigned in the 5th Cycle Housing Element.
 In 2019, the housing stock included the following unit types: 87 percent of homes were single-family detached; 10 percent were multifamily; 2 percent were mobile homes; and 1 percent were single-family attached.
 From 2010 to 2019, the City has experienced a stable vacancy average of 51 percent as a result of tourism and second-home ownership.
 As of 2019, 80 percent of Carmel-by-the-Sea’s vacant units were for seasonal, recreational, or occasional (second home) use.
 In 2022, the median home value was estimated to be $2,070,835. Home prices increased by 59 percent from 2019 to 2022. This reflects a 20 percent higher increase than the County, which is similar to nearby cities.12
 As of 2023, the average rent for an apartment in Carmel-by-the-Sea ranged from $2,200 (studio) to $5,459 (three bedrooms).13
A.2 Population, Employment, and Household Characteristics Population characteristics impact current and future housing needs in a community. A city’s population growth, age composition, and race and ethnicity composition help to determine the type and extent of housing needed. The following section provides analysis of population characteristics and local trends that affect housing demand in Carmel-by-the-Sea.
12 From Zillow Home Value Index, December 2019-2022
13 From Zillow Rental Price Index, March 2023
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Appendix A – Housing Needs and Fair Housing Report A-8
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Population Growth
Table A-1 shows population projections through 2045 according to the Association of Monterey Bay Area Governments (AMBAG) 2022 Regional Growth Forecast. In Carmel-by-the-Sea, the population is forecast to grow approximately 3 percent between 2015 to 2045. This reflects 11 percent less than the County, 1 percent more than Pacific Grove and 56 percent less than Del Rey Oaks.14 Population growth forecasts provide critical insight to the future demands of communities in terms of housing needs, employment, and more.

Table A-1 - Population Growth Forecast by Jurisdiction, 2015-2045 Jurisdictions
Population Change 2015-2045
2015 2020 2025* 2030* 2035* 2040* 2045* Numeric %
Monterey County 430,310 441,143 452,761 467,068 476,028 483,884 491,443 61,133 14% Carmel-by-the-Sea 3,854 3,949 3,946 3,954 3,964 3,974 3,984 130 3% Del Rey Oaks 1,663 1,662 1,693 1,734 1,859 2,330 2,650 987 59% Pacific Grove 15,460 15,265 15,290 15,395 15,530 15,676 15,817 357 2% Source: AMBAG Regional Growth Forecast, 2022 NOTE: *Projected growth values Figure A-2 illustrates population growth in Carmel-by-the-Sea between 2010-2019. Carmel-by-the- Sea’s population increased by 2.8 percent from 2010 to 2019. The City’s population steadily increased from 2010 to 2017 before experiencing a sharp decline through 2019.

Figure A-2 - Population Growth, Carmel-by-the-Sea, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2010-2019 Age Characteristics
A community’s housing needs are partly determined by preferences of age groups and household types (e.g., age, family/non-family, female-headed). When seeking housing, households may prioritize factors such as size, accessibility, and price. For instance, younger and middle-aged households may seek 14 These two cities have been chosen for comparison throughout the document based on having comparable population sizes to Carmel-by-the-Sea.

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Appendix A – Housing Needs and Fair Housing Report A-9
Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 homes that can accommodate a growing household size, whereas older adults may seek to downsize to an apartment with assistive care services or a smaller, more affordable single-family home. Disabled persons may seek homes that are accessible and include universal design or visitability features. Overall, the life stages of a population determine the housing stock that is needed in a community.

In 2010, Carmel-by-the-Sea’s predominant age
group was individuals between 65 and 74 years of
age (19 percent). Figure A-3 shows that between
2010 and 2019, the general age of the population
has been slowly increasing, with the most
populous age groups in the City being individuals
between 55 and 84 years of age. The City’s median
age has changed little since 2010, ranging from 56
in 2010, 54 in 2015, and 59 in 2019. Overall, the
City’s aging trend suggests a demand for housing
geared toward middle-aged to senior groups.

Figure A-3 - Population Distribution by Age, Carmel-by-the-Sea, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2010, 2015, 2019 Table A-2 shows population age distribution revealing that Carmel-by-the-Sea’s most populous age group in 2019 was individuals 65 to 74 years of age (21 percent). Compared to the County and nearby cities, Carmel-by-the-Sea has the largest 55 to 85+ age group (43 percent) followed by Pacific Grove (27 percent), Del Rey Oaks (23 percent), and the County (13 percent). Since 2010, Carmel-by-the-Sea’s smallest age demographic are those aged 0-14.
“When I grew up, this was a town of
children. All the property owners were
parents. All the employees in the stores
were parents. So, everything in this town
was about children, and we don't have
children anymore.”
May 24, 2023 Housing Ad Hoc Committee
Community Meeting Attendee
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Appendix A – Housing Needs and Fair Housing Report A-10 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-2 - Population Age Distribution by Jurisdiction, 2019 Jurisdiction
Population Age
0-4 5-14 15-24 25-34 35-44 45-54 55-64 65-74 75-84 85+
Monterey County 7.3% 14.8% 14.3% 14.4% 13.0% 11.8% 11.1% 7.7% 3.6% 1.9% Carmel-by-the-Sea 1.4% 9.7% 1.4% 8.1% 10.6% 11.4% 14.3% 21.3% 14.9% 7% Del Rey Oaks 5.7% 8.3% 5.7% 12.6% 12.5% 13% 18.9% 15.9% 4.4% 2.9% Pacific Grove 3.5% 12.2% 8.5% 10.0% 10.4% 13.3% 14.7% 16.5% 6.6% 4.3% Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
Race and Ethnicity Characteristics
Examining the demographic, ethnic, and racial composition of a region is integral to understanding fair housing concerns including access to economic opportunity and safe and affordable housing. Historic exclusionary governmental policies, biased mortgage lending practices, and other tactics have caused racial and ethnic segregation and spatial inequities. This section provides an overview of racial/ethnic composition and segregation patterns within Monterey County and the City of Carmel-by-the-Sea.

Understanding the racial and ethnic composition of a city is vital to ensuring equal opportunity to housing for all groups, inclusive of cultural norms and preferences. Figure A-4 illustrates the racial and ethnic composition of Carmel-by-the-Sea compared to the County.

Figure A-4 - Population by Race Compared to the County, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
When comparing the City and the County, non-Hispanic White and Hispanic or Latino populations are the most represented; however, the County presents more diversity than Carmel-by-the-Sea.

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Appendix A – Housing Needs and Fair Housing Report A-11 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Non-Hispanic White individuals comprise 87 percent of Carmel-by-the-Sea’s population followed by Hispanic or Latino (8 percent) and Asian populations (5 percent). In contrast, the County’s largest population is Hispanic or Latino individuals (60 percent) followed by non-Hispanic White (31 percent).

The City has no populations identifying as American Indian or Alaska Native or Native Hawaiian or Other Pacific Islander. Black or African American non-Hispanic individuals represent less than 1 percent of the City’s population.

Table A-3 provides a comparison of racial and ethnic composition by jurisdiction. In 2019, Carmel-bythe-Sea (87 percent) and the neighboring City of Pacific Grove (83 percent) had the largest nonHispanic White populations compared to Del Rey Oaks (75.5 percent) and the County (30.8 percent).

Compared to surrounding cities and the County, Carmel-by-the-Sea had the lowest Asian population (5 percent). Overall, Carmel-by-the-Sea is one of the least diverse when compared to the County and the nearby cities of Del Rey Oaks and Pacific Grove.

Table A-3 - Population by Race by Jurisdiction, 2019
Jurisdiction
American
Indian or
Alaska
Native
Asian,
Alone
Black or
African
American,
NonHispanicWhite, NonHispanicSome Other
Race
Hispanic or
Latino
Native
Hawaiian and
Other Pacific
Islander
Monterey County 0.2% 5.5% 2.5% 30.8% 0.1% 60.3% 0.5%
Carmel-by-the-Sea 0.0% 5.2% 0.1% 86.5% 0.0% 8.2% 0.0%
Del Rey Oaks 0.0% 7.1% 2.5% 75.5% 0.0% 13% 0.3%
Pacific Grove 0.2% 5.8% 1.0% 82.8% 0.0% 10.3% 0.1%
Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
When analyzing race and ethnicity in a city, it’s important to understand how demographics have changed over time. Figure A-5 illustrates changes in population by race between 2010-2019 in Carmelby-the-Sea. During this time frame, Carmel-by-the-Sea’s population composition experienced fluctuations in nearly all populations, and by 2019 saw a decline in each population except nonHispanic White. In 2015, the non-Hispanic White population experienced a 2 percent decrease in size, while the Asian and Hispanic or Latino populations increased 2 percent and 3 percent, respectively. In 2019, Carmel-by-the-Sea experienced a 7 percent increase in the non-Hispanic White population, and a decline in both the Asian and Hispanic or Latino populations by 4 percent and 3 percent, respectively.

Since 2015, population levels have remained less than 1 percent for Black or African American, American Indian or Alaska Native, Native Hawaiian, and Other Pacific Islander populations in Carmelby-the-Sea.

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Appendix A – Housing Needs and Fair Housing Report A-12 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-5 - Population by Race, Carmel-by-the-Sea, 2010-2019 Demographic characteristics such as the racial and ethnic composition of a city are necessary to inform the housing needs of a community inclusive of cultural norms and preferences.

Integration and Segregation
To inform priorities, policies, and actions, the housing element must include an analysis of integration and segregation, including patterns and trends. Integration generally means a condition in which there is not a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a particular type of disability in a specific geographic area. Segregation generally means the opposite condition, where concentrations of the characteristics described above are high in a specific geographic area.

Integration and Segregation
“Integration generally means a condition in which there is not a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a particular type of disability when compared to a broader geographic area.

Segregation generally means a condition in which there is a high concentration of persons of a particular race, color, religion, sex, familial status, national origin, or having a disability or a type of disability in a particular geographic area when compared to a broader geographic area.” Source: California Department of Housing and Community Development Guidance, 2021, page 31.

Residential segregation and exclusion, whether by race, ethnicity, disability, or income, is a result of numerous housing policies, practices, and procedures – both public and private – that have had ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-13 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 enduring and pervasive negative impacts. Overt and covert housing discrimination through land use policy, shifting housing markets, and patterns of investment and disinvestment, have restricted meaningful fair housing choice and equitable access to opportunity, particularly for communities of color. Historic patterns of segregation persist in California despite the long-standing federal mandate, established by the Fair Housing Act of 1968, that federal agencies and federal grantees affirmatively further the purposes of the FHA.

Past and present discriminatory policies and practices, including long-term disinvestment, have resulted in neighborhoods with concentrated poverty and poor housing stock, limited access to opportunity, unsafe environmental conditions, underfunded schools, dilapidated infrastructure, and other disproportionately experienced problems. In addition, governmental policies have subsidized the development of segregated, high-resourced suburbs in metropolitan areas by constructing new highway systems—often through lower income communities of color— to ensure access to job opportunities in urban centers. This physical and policy infrastructure supports patterns of discrimination and high levels of segregation that continue to persist in California and across the country. All of these conditions persist despite the over 50-year-old obligation to prohibit discrimination and affirmatively further fair housing.15
Figure A-6 shows the percentage of non-White and White populations throughout the region from 2010 to 2019.

Figure A-6 - Regional Non-White vs. White Population, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2010, 2015, 2019 15 California Department of Housing and Community Development. 2021. AFFH Guidance Memo. https://www.hcd.ca.gov/community-development/affh/docs/affh_document_final_4-27-2021.pdf ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-14 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 As of 2019, the City of Carmel-by-the-Sea has the highest percentage (86.5 percent) of White residents and the lowest percentage of Non-White residents (13.5 percent) when compared to the County, and the cities of Del Rey Oaks and Pacific Grove. Given the City’s status as being a “Highest Resource” city (see Figure A-17), having the highest median household income (see Figure A-16), and being a majority Senior community, Carmel-by-the-Sea recognizes the need to attract a more diverse population into the City and has identified various community resources and organizations to assist individuals that may have disparities in access to opportunity, and fall into the “special needs” category. A complete breakdown of service providers and community organizations that are available to the special needs populations is available in Section A.4 (“Special Needs Groups”) of this Appendix.

Diversity Index
The Diversity Index measures the degree to which the five major ethnic populations (non-Hispanic White, non-Hispanic Black, Asian and Pacific Islander, Hispanic, and Two or more races) are evenly distributed across a geographic area. The index ranges from 0 to 1 – where 0 is low diversity, meaning only one group is present and 1 is high diversity, meaning an equal proportion of all five groups is present).

Figure A-7 below depicts the level of diversity within the City. Carmel-by-the-Sea, along with neighboring jurisdictions have the lowest levels of diversity within the region. Carmel-by-the-Sea has a low level of diversity with 86.5 percent of the population identifying as non-Hispanic White.

Racially or Ethnically Concentrated Areas of Poverty and Affluence A Racially Concentrated Area of Poverty or an Ethnically Concentrated Area of Poverty (R/ECAP) and a Racially Concentrated Area of Affluence (RCAAs) represent opposing ends of the segregation spectrum from racially or ethnically segregated areas with high poverty rates to affluent predominantly White neighborhoods. Historically, HUD has paid particular attention to R/ECAPs as a focus of policy and obligations to AFFH. Recent research out of the University of Minnesota Humphrey School of Public Affairs argues for the inclusion of RCAAs to acknowledge current and past policies that created and perpetuate these areas of high opportunity and exclusion.16 R/ECAPs
HCD and HUD’s definition of a Racially/Ethnically Concentrated Area of Poverty is:

A census tract that has a non-White population of 50 percent or more (majority-minority) or, for non-urban areas, 20 percent, AND a poverty rate of 40 percent or more; OR A census tract that has a non-White population of 50 percent or more (majority-minority) AND the poverty rate is three times the average tract poverty rate for the County, whichever is lower.

Source: California Department of Housing and Community Development Guidance, 2021. 16 From Goetz, E. G., Damiano, A., & Williams, R. A. (2019). Racially Concentrated Areas of Affluence: A Preliminary Investigation. Cityscape: A Journal of Policy Development and Research, 21(1), 99–124 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-15 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-7 - Diversity Index, Carmel-by-the-Sea, 2018
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Appendix A – Housing Needs and Fair Housing Report A-16 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 It is important to note that R/ECAPs and RCAAs are not areas of focus because of racial and ethnic concentrations alone. This study recognizes that racial and ethnic clusters can be a part of fair housing choice if they occur in a non-discriminatory market. Rather, R/ECAPs are meant to identify areas where residents may have historically faced discrimination and continue to be challenged by limited economic opportunity, and conversely, RCAAs are meant to identify areas of particular advantage and exclusion.

RCAAs
HCD and HUD’s definition of an RCAA is a census tract 1) with a percentage of its total White population that is 1.25 times higher than the average percentage of the COG region’s White population; and 2) has a median income that is 2 times higher than the COG Area Median Income (AMI). Generally, these are understood to be neighborhoods in which there are both high concentrations of non-Hispanic White households and high household income rates.

Source: California Department of Housing and Community Development Guidance, 2023 As can be seen in the Figure A-8 and Figure A-9, the City of Carmel-by-the-Sea is not considered a R/ECAP; nor, is the City considered an RCAA. As highlighted previously, Carmel-by-the-Sea does not have a majority-minority population and thus cannot be labelled as a R/ECAP. Figure A-10 shows that less than or equal to 20 percent of the City’s population is non-White. Though Carmel-by-the-Sea’s percentage of exclusively White population and AMI are higher than the County-wide average, the median income in the City is not high enough for the jurisdiction to be considered an RCAA.17 17 To be considered an RCAA, census tracts must have a Location Quotient (LQ) of more than 1.25 and a median income

1.5 times higher than the COG AMI or 1.5 times higher than the State AMI, whichever is lower. In this case, Carmel’s median income would need to be 1.5 times greater than the State AMI of $69,021.

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Appendix A – Housing Needs and Fair Housing Report A-17 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-8 - R/ECAP by Census Tract, Carmel-by-the-Sea, 2009-2013 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-18 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-9 - RCAAs by Census Tract, Carmel-by-the-Sea, 2015-2019 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-19 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-10 - Percent Non-White by Block Group, Carmel-by-the-Sea, 2018 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-20 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Employment
Employment characteristics can significantly impact the housing needs and trends of a community from income and wage scale to job location and industry. Employment and income are determinates of a population’s ability to purchase housing including the type of housing and size, both of which can induce negative effects such as overpayment and overcrowding. Table A-4 summarizes projected employment growth for Carmel-by-the-Sea, the County, and nearby cities from 2015-2045.

Table A-4 - Employment Growth Forecast by Jurisdiction, 2015-2045 Jurisdictions
Population Change 2015-2045
2015 2020 2025* 2030 2035* 2040* 2045* Numeric Percent
Monterey County 225,268 243,015 245,054 249,613 253,918 258,553 263,437 38,169 17% Carmel-by-the-Sea 3,353 3,566 3,593 3,674 3,752 3,833 3,915 562 17% Del Rey Oaks 705 748 753 774 794 815 834 129 18%
Pacific Grove 7,470 8,016 8,061 8,152 8,244 8,343 8,445 975 13% Source: AMBAG Regional Growth Forecast, 2022
Note: *Projected growth values
According to the AMBAG 2022 Regional Growth Forecast, Carmel-by-the-Sea was projected to experience an employment growth of 17 percent (562 new jobs) between 2015-2045. This projected employment growth mirrors the County (17 percent) and is 4 percent higher than Pacific Grove (13 percent), but reflects 1 percent lower than Del Rey Oaks (18 percent). This projected increase in job growth presents an opportunity for cities to construct additional housing options for the existing and future workforce.

Table A-5 shows 2010 and 2019 employment data for Carmel-by-the-Sea by sector. Key findings in employment data include the following:
 Education services, healthcare, and social assistance industries were the largest employers of Carmel-by-the-Sea (28 percent) in both 2010 and 2019, followed by arts, entertainment, recreation, accommodation, and food services (19 percent and 15 percent, respectively);  Information industries experienced the greatest increase between 2010 and 2019 (585 percent), followed by construction (276 percent);
 Five sectors experienced drastic declines in employment between 2010 and 2019 including finance and insurance, real estate, and rental leasing (137 percent), professional, scientific, management, and administrative services (61 percent), public administration (54 percent), arts, entertainment, recreation, accommodation and food services (35 percent), and education services, healthcare, and social assistance (20 percent);  Wholesale trade (2 percent) and agriculture, forestry, fishing and hunting, and mining (0 percent) industries experienced the least amount of growth; and  Overall, there was a 19 percent decrease in employment for Carmel-by-the-Sea residents between 2010 and 2019.

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Appendix A – Housing Needs and Fair Housing Report A-21 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-5 - Employment by Sector, Carmel-by-the-Sea, 2010 and 2019 Industry Sector
2010 2019 Percent
Change
2010-2019
People
Employed
Percent of City
Employment
People
Employed
Percent of City
Employed
Agriculture, forestry, fishing and
hunting, and mining
0 0% 0 0% 0%
Construction 25 1% 94 7% 276%
Manufacturing 40 2% 67 5% 68%
Wholesale Trade 0 0% 26 2% 2%
Retail Trade 247 14% 213 15% 14%
Transportation and warehousing, and
utilities
63 4% 95 7% 51%
Information 14 1% 96 7% 585%
Finance and insurance, real estate,
and rental leasing
172 10% 73 5% -137%
Professional, scientific, management,
and administrative services
273 15% 106 7% -61%
Education services, healthcare, and
social assistance
493 28% 394 28% -20%
Arts, entertainment, recreation,
accommodation, and food services
330 19% 216 15% -35%
Public Administration 112 6% 52 4% -54%
Total Employment 1,769 100% 1,432 100% -19%
Source: U.S. Census Bureau, ACS 5-Year Estimates, 2010, 2019 Balance of Jobs to Workers
A city houses employed residents who either work in the community where they live, or work elsewhere in the region. Conversely, a city may have job sites that employ residents from the same city but more often employ workers commuting from outside of it. One measure of local imbalance is the relationship between workers and jobs. A city with a surplus of workers, “exports” workers to other parts of the region, while a city with a surplus of jobs must conversely “import” them.

Smaller cities will typically have more employed residents than jobs and will export workers as a result, while larger cities tend to have a surplus of jobs and will import workers. To some extent, the regional transportation system is set up for this flow of workers to the region’s core job centers. At the same time, as the housing affordability crisis has illustrated, local imbalances may be severe, where local jobs and worker populations are out of sync at a sub-regional scale.

A community may offer employment for relatively low-income workers but have relatively few housing options for those workers. Conversely, it may house residents who are low-wage workers but offer few employment opportunities for them. Such relationships may cast extra light on potentially pent-up demand for housing in particular price categories. A relative surplus of jobs relative to residents in a given wage category suggests the need to import those workers, while conversely, surpluses of workers mean the community will export those workers to other jurisdictions. Such flows are not inherently bad, though over time, sub-regional imbalances may appear.

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Appendix A – Housing Needs and Fair Housing Report A-22 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-11 illustrates earnings of workers in comparison to worker place of residence and place of work in Carmel-by-the-Sea. In 2019, Carmel-by-the-Sea had more low-wage jobs than low-wage residents (where low-wage refers to jobs paying less than $25,000). At the high end of the wage spectrum (i.e., wages over $75,000 per year), the City had more high-wage jobs than high-wage residents.18 This indicates the City is a net-importer of workers for both low- and high-wage jobs. It should be noted that the minimum wage has increased since 2019, from $12 to $15.50, thus increasing the annual incomes of full-time workers as well.

Figure A-11 - Worker Earnings by Place of Residence and Place of Work, Carmel-by-the-Sea, 2019
Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
According to U.S. Census Bureau data reported in a Housing Feasibility Study for the City of Carmelby-the-Sea by ECONorthwest,19 a mere 2.6 percent of workers live and work in Carmel-by-the-Sea, while approximately half of all workers live within 10 miles of the City and 26 percent commute from more than 25 miles away.20 Concentrations in hospitality and leisure services may create obstacles for local workers that earn lower-incomes and cannot afford to live in the community. Such imbalances of jobs to housing impacts an individual’s ability to integrate into the community due to long distance travel, excessive costs of travel, and reduced personal time.

Unemployment rates21 are essential to understanding the affordability needs of a community when determining housing options. Table A-6 provides a breakdown of unemployment rates for Carmel-bythe-Sea, the County, and nearby cities. Compared to the County and nearby cities, Carmel-by-the-Sea 18 The source table is top-coded at $75,000, precluding more fine-grained analysis at the higher end of the wage spectrum. 19 From ECONorthwest, Housing Feasibility Study, 2023
20 From U.S. Census Bureau Longitudinal Employer-Household Dynamics Data 21 The term unemployment refers to a person who is actively searching for employment but is not able to find work.

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Appendix A – Housing Needs and Fair Housing Report A-23 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 has the lowest unemployment rate with less than 1 percent of unemployed residents. This indicates an approximate 4.8 percent less than the County, 5 percent less than the Del Rey Oaks, and 3.8 percent less than Pacific Grove.

Table A-6 - Unemployment Rate, Carmel-by-the-Sea, 2019
Jurisdictions Unemployment Rate
Monterey County 4.9%
Carmel-by-the-Sea 0.1%
Del Rey Oaks 5.1%
Pacific Grove 3.9%
Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
The Monterey Bay Area approved Regional Housing Needs Assessment (RHNA) Methodology is broken down into four income levels:
 Very Low Income (50 percent or less of the County’s median income);  Low Income (50-80 percent of the County’s median income);  Moderate Income (80-120 percent of the County’s median income); and  Above moderate Income (120 and above the County’s median income).

Carmel-by-the-Sea’s RHNA allocation is presented below in Table A-7.

Table A-7 - Regional Housing Needs Allocation
Income Group Percentage of AMI Share
Extremely Low-Income* <30 57
Very Low-Income <50 56
Low-Income 50-80 74
Moderate-Income 80-120 44
AboveModerate-Income 120+ 118
Total 349
Source: City of Carmel-by-the-Sea, 2023
* Extremely low-income RHNA is found as a subset within the very low-income category for all other tables in this document.

In Monterey County, the median household income in 2019 was an estimated $71,015 compared to Carmel-by-the-Sea at $98,188. Table A-8 lists occupations by mean salary in Monterey County.

According to Table A-8, the occupations that fall below 50 percent of the median income are Food Preparation and Serving-Related Occupations; Personal Care and Services Occupations; and Farming, Fishing, and Forestry Occupations. The majority of occupations in Monterey County have an average income that is low (50-80 percent AMI) or very low (<50 percent AMI). If applied to Carmel-by-theSea, it should be anticipated that affordable housing is needed to accommodate potential low- and very low-income households.

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Appendix A – Housing Needs and Fair Housing Report A-24 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-8 - Occupations by Mean Salary, Monterey County, 2019 Occupation Salary
Management Occupations $117,738
Business and Financial Operations Occupations $78,900
Computer and Mathematical Occupations $96,980
Architecture and Engineering Occupations $92,554
Life, Physical, and Social Science Occupations $84,516
Community and Social Services Occupations $59,549
Legal Occupations $103,094
Education, Training, and Library Occupations $69,296
Arts, Design, Entertainment, Sports, and Media Occupations $56,599 Healthcare Practitioners and Technical Occupations $115,486 Healthcare Support Occupations $42,625
Protective Service Occupations $70,161
Food Preparation and Serving-Related Occupations $30,127 Building and Grounds Cleaning and Maintenance Occupations $36,330 Personal Care and Service Occupations $31,984
Sales and Related Occupations $42,099
Office and Administrative Support Occupations $44,239
Farming, Fishing, and Forestry Occupations $29,901
Construction and Extraction Occupations $60,870
Installation, Maintenance, and Repair Occupations $54,180 Production Occupations $41,905
Transportation and Material Moving Occupations $37,144
Source: California Employment Development Division, Occupational Wage data, 2019 Household Characteristics
Characteristics of a household include household type and size, income, affordability, and special needs groups. According to HCD, a household is defined as “All persons who occupy a housing unit. The occupants may be a single family, on person living alone, two or more families living together, or any groups of related or unrelated persons who share living arrangements.” Large families, single parent households, female-headed households, or extremely low- and low-income households may be classified as Special Needs groups. Special Needs groups are identified due to the unique nature of household characteristics and potential housing challenges faced. The following section examines household characteristics trends in Carmel-by-the-Sea and the region.

Table A-9 provides an overview of the projected housing units needed in Monterey County, Carmel-bythe-Sea, and nearby cities, Del Rey Oaks and Pacific Grove.22 Carmel-by-the-Sea is forecast to have a household growth of approximately 1 percent by 2045 – an increase of 42 housing units. 22 From AMBAG Regional Growth Forecast, 2022
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Appendix A – Housing Needs and Fair Housing Report A-25 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Compared to the County, this reflects 18 percent less projected growth and 2 percent less growth than Pacific Grove. Of the nearby cities, the City of Del Rey Oaks has the highest projected increase in housing unit growth at 61 percent.

Table A-9 - Housing Forecast by Jurisdiction, 2015-2045 Jurisdictions
Population Change 2015 - 2045
2015 2020 2025* 2030* 2035* 2040* 2045* Numeric Percent Monterey County 139,177 141,764 146,716 153,852 159,100 162,612 165,328 26,151 19% Carmel-by-the-Sea 3,417 3,437 3,437 3,442 3,450 3,453 3,459 42 1% Del Rey Oaks 741 741 762 809 848 1,052 1,195 454 61%
Pacific Grove 8,184 8,201 8,214 8,267 8,336 8,400 8,463 279 3% Source: AMBAG Regional Growth Forecast, 2022 NOTE: *Projected growth values Household Type and Size
Figure A-12 illustrates household characteristics by type in 2019 for Carmel-by-the-Sea, the County, and nearby cities, Del Rey Oaks and Pacific Grove. In Carmel-by-the-Sea, the largest household type was married-couple family households (47 percent) followed by single-person households (40 percent).

This is consistent with the County and nearby cities. Carmel-by-the-Sea has the lowest percentage of female-headed households (6 percent) compared to the County (13 percent), Del Rey Oaks (7 percent), and Pacific Grove (9 percent).

Figure A-12 - Household by Type by Jurisdiction, 2019
Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
Figure A-13 illustrates household changes between 2010-2019 in Carmel-by-the-Sea. Over the last decade, married-couple family households have remained the largest household type in the City followed by single-person households. Since 2015, married-couple family households have begun declining, while single-person households have increased. Female-headed households experienced the ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-26 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 most fluctuation between 2010-2019, showing a steady increase between 2010-2013, then slowly decreasing through 2019 to 6 percent (7 percent decrease between 2013-2019). Male-headed households have slightly increased since 2010 from zero to 2 percent in 2019. These changes in household type over time indicate a need for housing options that appeal to both family-sized and smaller-sized households (keeping affordability in mind).

Figure A-14 illustrates households by household size for Carmel-by-the-Sea, the County, and nearby cities. Carmel-by-the-Sea’s largest household type according to size is 2-person households (42 percent) followed by 1-person households (40 percent). This is consistent with findings in Figure A-13, with married-couple family households remaining the largest household type since 2010 followed by singleperson households. This reflects a demand for affordable housing units appealing to married-couple and single-person households.

Figure A-13 - Changes in Household Type, Carmel-by-the-Sea, 2010-2019 Figure A-14 - Households by Household Size by Jurisdiction, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
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Appendix A – Housing Needs and Fair Housing Report A-27 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Household Income
Affordability is a key component in determining the housing needs of a community. Household income determines the ability of a household to purchase or rent a housing unit. However, fluctuating household incomes may result in the need to spend disproportionate amounts of income on housing costs, referred to as overpayment or cost burden. As a result, this may also lead to overcrowding and/or substandard living conditions.

The following are income categories based on area median income (AMI) according to HCD:
 Extremely low-income: households earning 0-30 percent of AMI;  Very low-income: households earning 30-50 percent of AMI;  Low-income: households earning 50-80 percent of AMI;
 Moderate-income: households earning 80-100 percent of AMI; and  Above-moderate income: households earning 100-120 percent of AMI.

Government Code §65583(a) defines extremely low-income households as earning 30 percent or below area median income, and considers them as a subset of the very low-income category. The extremely low-, very low-, and low-income groups are referred to as lower-income. In Carmel-by-the-Sea 28 percent of households are considered lower-income.

Table A-10 summarizes households by income category in Carmel-by-the-Sea in 2019. Above moderate-income households make up the majority of households in the City (62 percent) followed by lower-income households (28 percent). Approximately 7 percent of households in Carmel-by-the-Sea identify as extremely low-income. This reflects a need for more affordable housing in the City, and in tandem with Figure A-13 and Figure A-14 findings, it is likely the demand for single-person households is accompanied by a need for affordable options.

Table A-10 - Households by Income Category, Carmel-by-the-Sea, 2019 Income Category
(% of County MFI) Households Percent
Extremely Low-Income (30% MFI or less) 140 7%
Very Low-Income (30-50% MFI) 170 9%
Low-Income (50-80% MFI) 235 12%
Moderate-Income (80-100% MFI) 185 10%
Above Moderate-Income (>100% MFI) 1,200 62%
Total 1,930 100%
Source: Department of Housing and Urban Development (HUD) Comprehensive Housing Affordability Strategy (CHAS), 2015-2019 Figure A-15 illustrates the median household income in Carmel-by-the-Sea, the County, and nearby cities in 2019. Carmel-by-the-Sea’s median household income was $98,188 – approximately $27,173 higher than the County ($71,015). The City of Del Rey Oaks had the second highest median household income at $95,000 followed by Pacific Grove at $88,250. Understanding Carmel-by-the-Sea’s median household income determines what income category households identify with and what affordability levels look like for the community.

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Appendix A – Housing Needs and Fair Housing Report A-28 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-15 - Median Household Income by Jurisdiction, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
Figure A-16 highlights the median household income from 2010 to 2019, throughout the region.

Between 2010 and 2015, Carmel-by-the-Sea’s median household income remained relatively stable, and saw a 31.3 percent increase between the years of 2015 and 2019. Compared to other regional jurisdictions, Monterey County has maintained the lowest median household income, showing a slight decrease from 2010 to 2015, and a 20.8 percent increase from 2015 to 2019. The Cities of Del Rey Oaks and Pacific Grove followed similar trends to Carmel-by-the-Sea in that they increased slightly between the years of 2010 and 2015, and then increased significantly between 2015 and 2019.

Figure A-17 provides a breakdown of 2019 incomes by category in Carmel-by-the-Sea. Approximately 43 percent of households are earning $100,000 or more (more than the City’s annual median income).

Conversely, 26 percent households earn an annual income less than $50,000 ($48,188 less than the City’s annual median income). Approximately 41 percent of households are earning below the City’s annual median income, of which 10 percent earn less than $25,000.

Figure A-16 - Regional Median Household Income, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2010, 2015, 2019 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-29 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-17 - Income by Category, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimates, 2019
Figure A-18 illustrates median household income across Carmel-by-the-Sea. According to the HCD AFFH Data Viewer, Carmel-by-the-Sea households experience variation in median household income based on location. Households located in the center of the City reportedly earn less than the City’s annual median income ($98,188) and households located in the north and south earn more (>$87,100 - <125,000).

The household income characteristics in Carmel-by-the-Sea reveal a demand for the development of more affordable housing options that appeal to both lower-income and above-moderate households.

Carmel-by-the-Sea is comprised primarily of above moderate-income households (62 percent), most of which identify as married-couple families (47 percent). Nonetheless, 28 percent of households are lower-income and 40 percent of households identify as single-persons. Affordable housing in Carmelby-the-Sea must accommodate these households as well despite their non-majority makeup.

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Appendix A – Housing Needs and Fair Housing Report A-30 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-18 - Median Income by Block Group, Carmel-by-the-Sea, 2015-2019 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-31 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-19 illustrates housing by tenure in Carmel-by-the-Sea, the County, and nearby cities. Fiftyseven (57) percent of households in Carmel-by-the-Sea are owners and 43 percent are renters. This reflects an approximate 6 percent higher owner household population than the County (51 percent), 11 percent higher than Pacific Grove (46 percent), and 14 percent lower than Del Rey Oaks (71 percent).

Figure A-19 - Housing Tenure by Jurisdiction, 2019
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
A.3 Disproportionate Housing Needs
Housing Problems and Severe Housing Problems
The following section details housing problems and severe housing problems in Carmel-by-the-Sea according to the Census Bureau Comprehensive Housing Affordability Strategy (CHAS).

Disproportionate Housing Needs
“Disproportionate housing needs generally refers to a condition in which there are significant disparities in the proportion of members of a protected class experiencing a category of housing need when compared to the proportion of members of any other relevant groups, or the total population experiencing that category of housing need in the applicable geographic area. For purposes of this definition, categories of housing need are based on such factors as cost burden and severe cost burden, overcrowding, homelessness, and substandard housing conditions.” Source: California Department of Housing and Community Development Guidance, 2021, page 39.

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Appendix A – Housing Needs and Fair Housing Report A-32 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The CHAS data set provides in-depth analysis on housing needs by income level according to types of households. According to CHAS, housing problems are defined as having one or more of the following variables:
 Incomplete kitchen facilities;
 Incomplete plumbing facilities;
 More than one person per room; and
 Cost burden greater than 30 percent.

Severe housing problems are defined as having one or more of the following variables:
 Incomplete kitchen facilities;
 Incomplete plumbing facilities;
 More than 1.5 persons per room; and
 Cost burden greater than 50 percent.

Additionally, CHAS defines cost burden as the ratio of housing costs to household income. The following defines cost burden by renter and owner:
 Renter Cost Burden: gross rent (contract rent plus utilities); and  Owner Cost Burden: select monthly owner costs including mortgage payment, utilities, association fees, insurance, and real estate taxes.

Figure A-20 and Figure A-21 illustrate housing problems by tenure and severe housing problems by tenure in Carmel-by-the-Sea during 2019. Approximately 60 percent of renter households have at least one of four housing problems and 36 percent have at least one of four severe housing problems. In contrast, 47 percent of owner households experience at least one housing problem and 25 percent have at least one severe housing problem.

Figure A-20 - Housing Problems by Tenure, Carmel-by-the-Sea, 2015-2019 Source: U.S. Census Bureau, CHAS Data, 2015-2019
Note: The four housing problems are: incomplete kitchen facilities, incomplete plumbing facilities, more than 1 person per room, and cost burden greater than 30%.

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Appendix A – Housing Needs and Fair Housing Report A-33 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-21 - Severe Housing Problems by Tenure, Carmel-by-the-Sea, 2015-2019 Source: U.S. Census Bureau, CHAS Data, 2015-2019
Note: The four housing problems are: incomplete kitchen facilities, incomplete plumbing facilities, more than 1.5 person per room, and cost burden greater than 50%.

Overcrowding
Understanding the prevalence of overcrowded households within a community helps determine the need for affordable and adequately sized housing units for the community. Overcrowding is defined as a household with more than one occupant per room excluding bathrooms and kitchens. Units with more than 1.5 persons per room are considered severely overcrowded. Overcrowding may occur due to a lack of available affordable and/or adequately sized housing units. Cultural norms and customs combined with low-income or lack of adequately size housing units can result in overcrowding too. For example, in Asian culture, households are often comprised of multi-generations. If this custom is also compounded by low-income or lack of adequately sized housing units overcrowding may occur.

Figure A-22 illustrates overcrowding by severity in Carmel-by-the-Sea, the County, and nearby cities in 2019. The City of Del Rey Oaks households experience the least amount of overcrowding (0.8 percent) and no severe overcrowding, compared to Carmel-by-the-Sea households that experience zero percent moderate overcrowding, but 6 percent severe overcrowding. Monterey County has a higher overall percentage of households that experience overcrowding (9 percent) and severe overcrowding (5 percent) compared to Carmel-by-the-Sea.

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Appendix A – Housing Needs and Fair Housing Report A-34 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-22 - Overcrowding by Severity by Jurisdiction, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Figure A-23 illustrates overcrowding by tenure and severity in Carmel-by-the-Sea during 2019. Renter households in Carmel-by-the-Sea experience 8 percent more overcrowding than owner households.

While renter households do not experience overcrowding (more than 1-person per room), 10 percent experience severe overcrowding (more 1.5-persons per room). Similarly, owner households in Carmelby-the-Sea do not experience overcrowding, but 2 percent do experience severe overcrowding.

Figure A-23 - Overcrowding by Tenure and Severity, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Figure A-24 illustrates overcrowded households in Carmel-by-the-Sea. According to the HCD AFFH Data Viewer, Carmel-by-the-Sea households experience no variation in overcrowding based on location.

In the City, overcrowding rates are less than 8.2 percent.

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Appendix A – Housing Needs and Fair Housing Report A-35 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-24 - Overcrowded Households, Carmel-by-the-Sea Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-36 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Cost Burden
According to HCD, overpayment or cost burden is measured as households spending more than 30 percent of their gross income including utilities for housing; severe overpayment or severe cost burden is measured as households spending 50 percent or more of their gross income for housing. For the duration of this report, overpayment will be referred to as cost burden.

The cost burden rates of owners and renters in a community provide insight to housing needs such as, the affordability of the local housing market and the availability of housing units that accommodate household needs like size and housing type. Additionally, federal and state agencies examine cost burden to determine a community’s need for housing assistance.

Figure A-25 illustrates cost burden severity in Carmel-by-the-Sea, the County, and nearby cities.

Carmel-by-the-Sea household cost burden rates are similar to the County. In Carmel-by-the-Sea, 46 percent of households experience some level of cost burdened, of which 23 percent are severely cost burdened, while the County has a cost burden rate of 22 percent and a severe cost burden rate of 18 percent. The cities of Del Rey Oaks and Pacific Grove have slightly lower rates of cost burden overall with 67 percent and 61 percent of households experiencing no cost burden, respectively.

Overall, the City of Del Rey Oaks has the lowest percent of households experiencing any type of cost burden. It is important to relate Carmel-by-the-Sea’s approximate 46 percent cost burden with its 10 percent population of overcrowded renter households, as these may be indicators of an unaffordable and homogenous local housing market.

Figure A-25 - Cost Burden Severity by Jurisdiction, 2015-2019 Source: U.S. Census Bureau, CHAS Data, 2015-2019
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Appendix A – Housing Needs and Fair Housing Report A-37 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-26 illustrates cost burden by tenure in Carmel-by-the-Sea. Renter and owner households experience similar levels of cost burden. Renter households experience 24 percent cost burden and 23 percent severe cost burden (47 percent total), whereas owner households experience 23 percent cost burden and 22 percent severe cost burden (45 percent total). This reflects a 1 percent difference between cost burden and severe cost burden for renter and owner households, respectively.

Figure A-26 - Cost Burden by Tenure, Carmel-by-the-Sea, 2015-2019 Source: U.S. Census Bureau, CHAS Data, 2015-2019
Figure A-27 illustrates cost burden of home owners in Carmel-by-the-Sea. According to the HCD AFFH Data Viewer, the highest rates of cost burden among homeowners in Carmel-by-the-Sea are concentrated in the central and southern regions of the City. In these regions, 80 percent of owner households experience cost burden. In the northern region of the City, 40-60 percent of owner households experience cost burden.

Figure A-28 illustrates cost burden of renters in Carmel-by-the-Sea. When analyzing concentrations of cost burden among renter-occupied households in Carmel-by-the-Sea, there is no variation based on location. Between 40-60 percent of renter-households experience cost burden across the City.

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Appendix A – Housing Needs and Fair Housing Report A-38 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-27 - Cost Burden by Home Owners, Carmel-by-the-Sea, 2015-2019 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-39 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-28 - Cost Burden by Renter Households, Carmel-by-the-Sea, 2015-2019 Source: California Department of Housing and Community Development, AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-40 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 A.4 Special Needs Groups
Special needs groups are those that may face particular challenges in obtaining adequate housing due to inherent circumstances such as age, disabilities, household size, income level, age, and occupation. Large families, single parent households, female-headed households, or extremely low- and low-income households, and homeless persons may be classified as Special Needs groups. Special Needs groups are identified due to the unique nature of household characteristics and potential housing challenges faced.

Table A-11 provides a summary of special needs groups in Carmel-by-the-Sea.

Table A-11 - Overview of Special Needs Groups
Special Needs Groups Count
Percent of Total
Households
Percent of Total
Population
Total population 3,830 -- 100%
Total occupied units (households) 1,925 100% --
Extremely Low-income (0-30% of HAMFI) households 140 households 7% -- Total Senior Population 1,657 persons -- 43%
Senior Owner-Households 763 households 40% --
Senior Renter-Households 283 households 15% --
Persons with Disabilities1 406 persons -- 12%
Persons with Developmental Disabilities2 <70 persons -- -- Large Households 70 households 4% --
Single-Parent Households 153 households 8% --
Single-Parent, Female Headed Households with
Children (under 18) below poverty line
0 households -- --
People Living in Poverty 111 persons -- 3%
Farmworkers3 26,929 persons -- --
Migrant Farmworkers 4,972 persons -- --
Seasonal Farmworkers 12,123 persons -- --
Permanent Farmworkers 14,806 persons -- --
Persons Experiencing Homelessness4 1 person -- --
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019; U.S. Census Bureau CHAS 2015-2019 Data; USDA Statistics Services; California Department of Developmental Services, Consumer Count by California ZIP Code and Residence Type (2021).

Notes:

1. This estimate uses U.S. Census Bureau ACS 5-Year Estimates for 2021.

2. Data provided by California Department of Developmental Services and taken at the ZIP code level.

3. Agriculture, forestry, fishing and hunting and mining industry. Farmworker data is taken of the population 16 years and older. Data provided by USDA Statistics Services and taken at the County level for 2017; includes permanent and seasonal farmworkers.

4. Total results from 2022 Monterey County Homeless County and Survey Comprehensive Report.

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Appendix A – Housing Needs and Fair Housing Report A-41 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Extremely Low-Income Households and Poverty Status
Extremely low-income (ELI) households are those
that earn less than 30 percent of the median family
income (MFI).

Very low-income households are those that earn
50 percent of less of the MFI. Extremely lowincome households typically face a combination of housing challenges related to income status, family
size/type, disability status, access to housing
opportunities, and other household characteristics.

Additionally, ELI households are more likely to
experience overcrowding, cost burden, and
substandard housing conditions. Extremely low-income households are typically minimum-wage workers, disabled persons, farmworkers, and seniors on fixed incomes.

Table A-12 provides a breakdown of extremely low-income households in Carmel-by-the-Sea. The 2015-2019 Comprehensive Housing Affordability Strategy (CHAS) data indicates there were approximately 140 ELI households (7 percent of total households) in Carmel-by-the-Sea. Of the extremely low-income households in Carmel-by-the-Sea, 29 percent are renter-occupied households and 71 percent are owner-occupied households, or 2 percent and 5 percent of all households, respectively.

When analyzing cost burden of ELI households, approximately 120 ELI households experience severe cost burden (paying more than 50 percent of median gross income on housing) and 140 experience moderate cost burden (paying more than 30 percent of median gross income on housing). Of the ELI households experiencing some form of cost burden, the majority are owner-occupied households.

Data for overcrowding by income level is not available for Carmel-by-the-Sea. However, because owner-occupied households represent the majority of ELI households and experience higher rates of cost burden, overcrowding, substandard housing issues it may be assumed that ELI households experience overcrowding.

The projected RHNA for ELI households was based on the assumption that 50 percent of very lowincome households qualify as extremely low-income households. The very low-income housing need is 113 housing units, of which the City estimates 57 housing units will accommodate the extremely lowincome housing need. “It seemed really scary when we first
looked at the [RHNA numbers] and the
idea of trying to squeeze more into this
beautiful place that’s so unique [but] I
really like the idea of coming at this from
a compassionate and creative
perspective. I really resonate with that.”
November 178, 2023 Housing Ad Hoc Committee
Community Meeting Attendee
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Appendix A – Housing Needs and Fair Housing Report A-42 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-12 - Extremely Low-Income Households, Carmel-by-the-Sea, 2015-2019 Households Number
Percentage of Total
Households
Total occupied units (households) 1,925 100%
Total Lower-income (0-80% of HAMFI) households 545 28%
Extremely Low-income (0-30% of HAMFI) households 140 7% Extremely Low-income renters 40 2%
Extremely Low-income owners 100 5%
Lower-income households paying more than 50% 270 14%
Extremely Low-income paying more than 50% 120 6%
ELI Renter HH severely cost burdened 20 1%
ELI Owner HH severely cost burdened 100 5%
Lower-income households paying more than 30% 430 22%
Extremely Low-income paying more than 30% 140 7%
ELI Renter HH moderately cost burdened 40 2%
ELI Owner HH moderately cost burdened 100 5%
Lower-income households experiencing 1 of 4 Housing Problems 450 23% Extremely Low-income households experiencing 1 of 4 Housing Problems 140 7% ELI Renter HH experiencing 1 of 4 Housing Problems 40 2% ELI Owner HH experiencing 1 of 4 Housing Problems 100 5% Source: U.S. Department of Housing and Urban Development (HUD), Comprehensive Housing Affordability Strategy (CHAS) 2015-2019.

Note: MFI = HUD Median Family Income, this is the median family income calculated by HUD for each jurisdiction, to determine Fair Market Rents (FMRs) and income limits for HUD programs. MFI will not necessarily be the same as other calculations of median incomes (such as Census number), due to a series of adjustments that are made.

The four housing problems are: incomplete kitchen facilities, incomplete plumbing facilities, more than 1 person per room, and cost burden greater than 30%.

Cost burden is the ratio of housing costs to household income. For renters, housing cost is gross rent (contract rent plus utilities). For owners, housing cost is "select monthly owner costs", which includes mortgage payment, utilities, association fees, insurance, and real estate taxes.

In 2019, approximately 111 persons were identified as living below the poverty line.23 Figure A-29 illustrates the percent of the population in Carmel-by-the-Sea living below the poverty line in 2019 by race and ethnicity. Despite being the smallest population in the City (comprising .1 percent of the population), the Black or African American population is estimated to have the highest rate of poverty (50 percent); however, the low sample size makes it difficult to draw conclusions about this population.

In contrast, the non-Hispanic White population represents 87 percent of the total population and only 2 percent is living below the poverty line. The Hispanic or Latinx population experiences the second highest rate of poverty with 13 percent living below the poverty line. 23 From U.S. Census Bureau ACS 5-Year Estimate, 2019, Table S1701 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-43 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-29 - Percent Living Below the Poverty Line by Race and Ethnicity, Carmel-by-theSea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Note: Race/Ethnicity represents percentage of the total population* In Carmel-by-the-Sea, housing costs may pose a challenge to residents that are from Extremely LowIncome households. With a median home value of $2,070,835 (compared to a median home value of $561,490 in Monterey County), ELI residents may find it difficult to achieve homeownership.

Additionally, ELI residents typically experience limited accessibility to suitable transportation services to commute from home to work.

To address the needs of ELI households, the City will adopt housing programs to facilitate the construction of affordable and supportive housing for ELI households. Policies that will directly impact ELI households in Carmel-by-the-Sea include:
 Policy 3.1: Incentivize affordable housing development, with an emphasis on affordable housing built to accommodate Extremely Low-Income residents. Encourage the private sector to produce affordable housing;
 Policy 4.1: Support energy and water conservation programs to reduce the consumption of these resources in housing and to reduce housing costs; and  Policy 5.1: Support and enforce fair housing laws. Expand fair housing choice by promoting housing opportunities and removing impediments to fair housing.

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Appendix A – Housing Needs and Fair Housing Report A-44 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The City is committed to implementing a suite of programs which emphasize the provision of multifamily housing and non-traditional housing types to provide a variety of housing types to meet the needs of ELI households, including Program 1.3.C, 3.1.B, 3.3.A, 3.3.B, and 3.3.D (see Chapter 2).

Additionally, the City has identified the following service providers and programs to assist residents that are from an Extremely Low-Income household:
 Fair Housing Education;
 Housing Choice Voucher Program;
 211 Monterey/United Way;
 Community Housing Improvement Systems and Planning Association, Inc. (CHISPA) Housing;
 Monterey-Salinas Transit; and
 Independent Transportation Network of Monterey (ITN Monterey).

Seniors
Seniors are identified as individuals 65 years and older. Senior households often experience a combination of factors that can make accessing or keeping affordable housing a challenge. They often live on fixed incomes and are more likely to have disabilities, chronic health conditions, and/or reduced mobility. Seniors who rent may be at even greater risk for housing challenges than those who own, due to income differences between these groups.

Figure A-30 illustrates the senior population in Carmel-by-the-Sea, the County, and nearby cities.

Compared to the County and nearby cities, Carmel-by-the-Sea has the highest senior population (43 percent), approximately 30 percent more than the County and 16 percent more than Pacific Grove.

Figure A-30 - Senior Population by Jurisdiction, 2019
Source: U.S. Census Bureau, 2019
Note: Senior population is defined as persons 65 years and older.

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Appendix A – Housing Needs and Fair Housing Report A-45 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-31 illustrates senior housing by tenure in Carmel-by-the-Sea during 2019. Senior households in Carmel-by-the-Sea are primarily owners (73 percent). Similarly, the senior households of the County (73 percent) and nearby cities of Del Rey Oaks (91 percent) and Pacific Grove (68 percent) are majority owners.

Figure A-31 - Senior Housing by Tenure, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, 2019
Note: Senior population is identified as persons 65 years and older.

Figure A-32 illustrates senior households by their income. 14 percent of Carmel-by-the-Sea’s senior households earn a yearly income of $200,000 or more). However, an estimated 61 percent of senior households earn less than the City’s median household income ($98,188).

Figure A-32 - Senior Households by Income, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, 2019
Note: Senior population is identified as persons 65 years and older.

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Appendix A – Housing Needs and Fair Housing Report A-46 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 In Carmel-by-the-Sea, housing costs does not necessarily pose a challenge to the City’s senior residents, as over 70 percent of the City’s senior population owns a home (see Figure A-31). However, elderly residents may be more likely experience limited accessibility to suitable transportation services, and limited mobility.

The Carmel Foundation offers a variety of recreational opportunities for the seniors of Carmel-by-theSea, including affordable lunches; activities and classes; free medical equipment loans; day excursions outside of the Monterey-Carmel area to museums, plays and shopping; free blood pressure checks; and caregiver support groups. The Foundation also provides 50 affordable apartments for low-income seniors and partners with senior-serving agencies to provide additional services including the following:
 Legal Services for Seniors, providing free legal consultations;  Alliance on Aging, providing assistance with Medicare or supplemental insurance;  Visiting Nurse Association & Hospice (VNA), providing a grief support group; and  Independent Transportation Network (ITN) Monterey County, offers rides to seniors in Monterey County.

In addition to The Carmel Foundation, the City has identified the following service providers and programs to assist seniors:
 The Salvation Army Good Samaritan Center;
 Meals on Wheels of the Monterey Peninsula;
 Seniors Helping Seniors;
 Seaside Recreation Services – Senior Center Programs;  Habitat for Humanity Monterey;
 Monterey County Aging and Disability Resource Connection (ADRC); and  Monterey-Salinas Transit Courtesy Card Rides.

People with Disabilities
People with disabilities face additional housing challenges. Encompassing a broad group of individuals living with a variety of physical, cognitive and sensory impairments, many people with disabilities live on fixed incomes and are in need of specialized care, yet often rely on family members for assistance due to the high cost of care. When it comes to housing, people with disabilities are not only in need of affordable housing but accessibly designed housing, which offers greater mobility and opportunity for independence. Unfortunately, the need typically outweighs what is available, particularly in a housing market with such high demand. People with disabilities are at a high risk for housing insecurity, homelessness, and institutionalization, particularly when they lose aging caregivers.

Figure A-33 illustrates population by disability status in Carmel-by-the-Sea, the County, and nearby cities in 2021. Twelve percent of the population in Carmel-by-the-Sea has some form of disability, which is on par with nearby cities. The cities of Del Rey Oaks and Pacific Grove each have a ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-47 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 population of 13 percent and 12 percent, respectively, with a disability. The County has the lowest percentage of persons with a disability at 9 percent.

Figure A-33 - Population by Disability Status by Jurisdiction, 2021 Source: U.S. Census Bureau, 2021
Over the last decade, the population of persons with disabilities has increased in Carmel-by-the-Sea.

Figure A-34 illustrates trends in persons with disabilities in Carmel-by-the-Sea between 2012-2021. In 2014, the population of persons with disabilities began to steadily increase from 12 percent to its highest point at 22 percent in 2018. In 2019, the upward trend in persons with disabilities began to decline reaching 16 percent, and eventually hitting 12 percent in 2021. Overall, the population of persons with disabilities has increased 3 percent since 2012.

Figure A-34 - Trends in Persons with Disabilities, Carmel-by-the-Sea, 2012-2021 Source: U.S. Census Bureau, 2012-2021
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Appendix A – Housing Needs and Fair Housing Report A-48 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-13 provides an overview of disability by type and age in Carmel-by-the-Sea during 2021.

Hearing difficulty is the most widespread disability in Carmel-by-the-Sea (41 percent) with the highest concentration in persons 65 years of age and older. Self-care difficulty is the least common disability with 7 percent experiencing this in Carmel-by-the-Sea. Overall, seniors (persons aged 65+) makeup the largest demographic with a disability (50 percent).

Table A-13 - Disability Status by Age, Carmel-by-the-Sea, 2021 Disability Type Under 18 18-64 65 and Over Total
Percent of Population
with a Disability
Hearing Difficulty 20 0 305 325 41%
Vision Difficulty 20 0 50 70 9%
Cognitive Difficulty 0 29 46 75 9%
Ambulatory Difficulty 0 0 142 142 18%
Self-care Difficulty 0 0 56 56 7%
Independent Living Difficulty 0 0 130 130 16%
Total 40 29 729 798 100%
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2021
Note: These disabilities are counted separately and are not mutually exclusive, as an individual may report more than one disability. These counts should not be summed.

State law also requires Housing Elements to examine the housing needs of people with developmental disabilities. Developmental disabilities are defined as severe, chronic, and attributed to a mental or physical impairment that begins before a person turns 18 years old. This can include Down’s Syndrome, autism, epilepsy, cerebral palsy, and mild to severe mental retardation. Some people with developmental disabilities are unable to work, rely on Supplemental Security Income, and live with family members. In addition to their specific housing needs, they are at increased risk of housing insecurity after an aging parent or family member is no longer able to care for them.

Table A-14 shows the population with developmental disabilities by age in Carmel-by-the-Sea. In Carmel-by-the-Sea, of the 798 persons with a disability, approximately less than 70 have a developmental disability. Of these, less than 31 are children/young adults (i.e., under the age of 18) and less than 36 are adults.

Table A-15 shows the population with developmental disabilities by residence in Carmel-by-the-Sea.

The most common living arrangement for individuals with developmental disabilities in Carmel-by-theSea is the home of parent/family/guardian.

Table A-14 - Population with Developmental Disabilities by Age, Carmel-by-the-Sea, 2021 Age Group Number
Age Under 18 <31
Age 18+ <36
Source: California Department of Developmental Services, Consumer Count by California ZIP Code and Age Group (2021).

Note: Universe: Population with developmental disabilities. Notes: The California Department of Developmental Services is responsible for overseeing the coordination and delivery of services to more than 330,000 Californians with developmental disabilities including cerebral palsy, intellectual disability, Down syndrome, autism, epilepsy, and related conditions. The California Department of Developmental Services provides ZIP code level counts. To get jurisdiction-level estimates, ZIP code counts were crosswalked to jurisdictions using census block population counts from Census 2010 SF1 to determine the share of a ZIP code to assign to a given jurisdiction.

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Appendix A – Housing Needs and Fair Housing Report A-49 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-15 - Population with Developmental Disabilities by Residence, Carmel-by-the-Sea, 2021 Residence Type Number
Home of Parent/Family/Guardian <38
Foster/Family Home 0
Independent/Supported Living <11
Other 0
Community Care Facility <11
Intermediate Care Facility 0
Source: California Department of Developmental Services, Consumer Count by California ZIP Code and Residence Type (2021).

Note: Universe: Population with developmental disabilities. Notes: The California Department of Developmental Services is responsible for overseeing the coordination and delivery of services to more than 330,000 Californians with developmental disabilities including cerebral palsy, intellectual disability, Down syndrome, autism, epilepsy, and related conditions. The California Department of Developmental Services provides ZIP code level counts. To get jurisdiction-level estimates, ZIP code counts were crosswalked to jurisdictions using census block population counts from Census 2010 SF1 to determine the share of a ZIP code to assign to a given jurisdiction.

In Carmel-by-the-Sea, the majority of the residents that have disabilities are also age 65 and over. The service organizations listed in the “Seniors” section above includes several resources that accommodate seniors with disabilities, including the Carmel Foundation, which provides meal delivery, assists seniors in finding in-home care resources, and more.

The City’s Municipal Code establishes procedures for persons with disabilities seeking equal access to housing including reasonable accommodation for person with disabilities. Additionally, the City follows the requirements of California Building Code Title 24 which establishes provisions for accessible building design. Currently, the City is implementing their Capital Improvement Plan (CIP), which includes sidewalk improvements, grading streets to correct slope, and installation of ADA ramps. The City’s Police Department and Carmel Youth Center are also undergoing building improvements, which include ADA accessibility features for public use.

In addition to the City’s efforts to provide an accessible community environment, the following service providers and programs are available in Monterey County to assist residents that are living with disabilities:
 Monterey County Aging and Adult Services;
 Monterey County Aging and Disability Resource Connection (ADRC);  Paradigm Adult Services;
 Special Kids Connect;
 Monterey-Salinas Transit Courtesy Card Rides;
 Independent Transportation Network of Monterey (ITN Monterey); and  MST Rides ADA Paratransit Agency.

Large Households
Large households are defined as households of five or more individuals. Large households often have different housing needs than smaller households. Household income and local housing markets can greatly impact a household’s ability to afford adequately sized housing. If a city’s rental housing stock ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-50 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 does not include larger apartments, large households who rent could end up living in overcrowded conditions. Similarly, large households may experience overpayment as a result of a high housing market and limited availability.

Figure A-35 illustrates 2019 households by size and tenure in Carmel-by-the-Sea. The City has 70 large households, of which 57 percent are renter-occupied households. Owner-occupied households makeup the majority of 1-person and 2-person households, whereas renter-occupied households makeup the majority of all 3-5 person households. This combined with a total cost burden rate of 46 percent for renter households (Figure A-25), suggests it is likely that large households in Carmel-by-the-Sea may experience overcrowding and/or overpayment.

Figure A-35 - Households by Size and Tenure, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
In Carmel-by-the-Sea, housing costs may pose a challenge to large households, as they are more likely to rent as opposed to purchasing a home, and experience higher cost-burden and overcrowding. With a median home value of $2,070,835 (compared to a median home value of $561,490 in Monterey County), large households may find it difficult to achieve homeownership. Furthermore, finding suitable transportation may be a challenge as well.

Generally, large households in Carmel-by-the-Sea can benefit from general programs and services for lower and moderate-income persons, including the Housing Authority of the County of Monterey Housing Choice Voucher program, and various community and social services provided by non-profit organizations in the region. Program 3.2.D has been included in this Housing Element to encourage the development of family friendly affordable housing units (see Chapter 2).

The City also has the ability to leverage city-owned sites to incentivize the development of larger, family friendly units that accommodate a minimum of three bedrooms per unit. The City will work with nonprofit affordable housing developers to encourage housing development that meets the needs of large ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-51 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 households. Further, the City’s parking standards are based on a per unit requirement and will not pose a constraint to the development of larger units, which in some jurisdictions is determined by unit size.

In addition to the City’s efforts to enable the development of family friendly residential units, the following service providers and programs are available in Monterey County to assist large households:
 Housing Choice Voucher Program;
 Fair Housing Education;
 Monterey County Down-payment Assistance Program;
 Monterey-Salinas Transit; and
 Monterey Dial-A-Ride Program.

Single-Parent Households
Households headed by one person are often at greater risk of housing insecurity, particularly femaleheaded households, who may be supporting children or a family with only one income.

In Carmel-by-the-Sea, the largest proportion of households are married-couple family households at 47 percent, while female-headed households make up 6 percent, and male-headed households make up 2 percent of all households (Figure A-12). Figure A-36 shows single-parent households in Carmel-by-theSea, the County, and nearby cities. Compared to the County and nearby cities, Carmel-by-the-Sea’s ratio of single-parent households is on par. Carmel-by-the-Sea’s single-parent households are predominantly female-headed family households (75 percent). Male-headed family households makeup 25 percent.

Figure A-36 - Single-Parent Households by Jurisdiction, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Over the last decade, male-headed family households have slightly increased in Carmel-by-the-Sea, while female-headed family households have decreased. Figure A-37 illustrates trends in single-parent households in Carmel-by-the-Sea between 2010-2019.24
24 The data reports female- and male-headed family household as a percentage of total households in Carmel-by-the-Sea.

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Appendix A – Housing Needs and Fair Housing Report A-52 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-37 - Trends in Single-Parent Households, Carmel-by-the-Sea, 2010-2019 During this period, male-headed households increased from zero percent in 2010 up to 2 percent by 2015. From 2016-2018, the male-headed family households remained at 1 percent until increasing to 2 percent by 2019. Comparatively, female-headed family households decreased a total of 3 percent between 2010-2019. From 2010-2013, female-headed family households steadily increased reaching its highest point at 13 percent in 2013. By 2014, the group experienced a 2 percent decrease and remained constant until 2018 when it began to decline, reaching 6 percent in 2019.

Female-headed households with children may face particular housing challenges, with pervasive gender inequality resulting in lower wages for women. Moreover, the added need for childcare can make finding a home that is affordable more challenging. In 2019, there were no single-parent households that fell in the Below Poverty Level category in Carmel-by-the-Sea.

Limited household income constrains the ability of single-parent households to afford adequate housing, childcare, health care, and other necessities. The Carmel Unified School District (CUSD) operates several programs that provide child care and early education services that may assist low income single-parent households, including the following:
 Universal Pre-Kindergarten at Carmelo School – Offers free enrollment early learning programs serving children aged four years old at several CUSD elementary sites and preschool sites.
 River Rec – Offers school age child care to assist working families in securing affordable quality child care, located at River Elementary School in Carmel. The program offers morning programs from 7:00 am to 8:40 am; afternoon programs from 2:00 pm to 6:00 pm; and full days from 7:00 am to 6:00 pm.
 Tular Rex – Offers school age child care to assist working families in securing affordable quality child care, located at Tularcitos Elementary School in Carmel Valley. The program offers morning programs from 7:00 am to 8:40 am; afternoon programs from 2:00 pm to 6:00 pm; and full days from 7:00 am to 6:00 pm.

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Appendix A – Housing Needs and Fair Housing Report A-53 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 The Carmel Youth Center, located at Torres Street and Fourth Avenue in Carmel-by-the-Sea, is a nonprofit youth center that has historically provided youth services in the community, including after school care and summer programs. The Carmel Youth Center accepts scholarship funding for lowincome households in need of affordable child care services. The Center is currently under review by the State to receive licensure and is expected to reopen by Summer 2024.

Due to the small geographical size of the city, childcare reflects the population size. Similar to many cities, demand is high for child care services in Carmel-by-the-Sea. Therefore, many lower-income residents rely on county resources, especially for subsidized child care. Monterey County Child Care provides resources for low-income households searching for subsidized child care and early learning programs. However, many resources are located outside of Carmel-by-the-Sea in the Salinas region, which may place transportation and access pressures on households in need of these services.

In an effort to relieve some of the housing and transportation issues that single-parent households may face, the City has identified the following service providers and programs to assist single-parent households:
 Housing Choice Voucher Program;
 Fair Housing Education;
 Monterey County Down-payment Assistance Program; and
 Monterey-Salinas Transit.

Farmworkers
Across the state, housing for farmworkers has been recognized as an important and unique concern.

Farmworkers generally receive wages that are considerably lower than other jobs and may have temporary housing needs. Finding decent and affordable housing can be challenging, particularly in the current housing market.

According to the U.S. Department of Agriculture Census of Farmworkers, the number of permanent farm workers in Monterey County has decreased since 2002, totaling 14,806 in 2017, and the number of seasonal farm workers has also decreased, totaling 12,123 in 2017. Figure A-38 shows hired farm labor in Monterey County between 2002-2017.

Agriculture consisting of crop farming and livestock grazing is the largest industry in Monterey County and contributes a significant amount of money to the County’s economy. Out of approximately 1.3 million acres of County land dedicated to agriculture, most of this area (approximately 80 percent) is used for grazing. The most productive and lucrative farmlands in the County are located in the North County, Greater Salinas, and Central Salinas Valley Planning Areas.

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Appendix A – Housing Needs and Fair Housing Report A-54 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-38 - Hired Farm Labor, Monterey County, 2002-2017 Source: U.S. Department of Agriculture, Census of Farmworkers (2002, 2007, 2012, 2017), Table 7: Hired Farm Labor.

Notes: Universe: Hired farm workers (including direct hires and agricultural service workers who are often hired through labor contractors). Farm workers are considered seasonal if they work on a farm less than 150 days in a year, while farm workers who work on a farm more than 150 days are considered to be permanent workers for that farm.

According to the 2021 American Census Survey (ACS) data, zero percent of individuals residing in Carmel-by-the-Sea households reported that they were employed in the Agriculture, Forestry, or Fishing and Hunting industry.25 According to the Department of Conservation’s Important Farmland Categories, the City of Carmel-by-the-Sea is entirely designated as “Urban and Built-up Land” and does not contain any important or prime farmlands.26 There are no agricultural lands or agriculturally zoned properties within the City limits. There are no farm labor housing developments in the City nor are there projects assisted with Rural Housing Administration financing; however, the City shares the responsibility for farmworker housing as farmworkers may work within 75 miles of agricultural land uses (including dairy, vineyards, and produce) and the City is within 75 miles of these uses. While HCD has no established metrics, the United States Department of Agriculture, (USDA) considers farmworkers that work at a specific location within 75 miles of their home to be “settled” and thus permanent members of their home community.

The California Institute for Rural Studies released a Farmworker Housing Study and Action Plan for Salinas Valley and Pajaro Valley in April 2018. Key findings of the Study included:
 A survey of 420 farmworkers in the laborshed as well as interviews with employers and other stakeholders was conducted to gather primary data. Among the farmworkers surveyed, men and women were relatively evenly distributed across age groups with 75 percent of the 25 Source: U.S. Census Bureau ACT 5-year Estimate, 2021, Table C24070 26 Source: California Department of Conservation Important Farmland Categories https://www.conservation.ca.gov/dlrp/fmmp/Pages/Important-Farmland-Categories.aspx ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-55 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 interviewees married. The clear majority of the immigrant farmworker interviewees had very few years of schooling. They were 92 percent immigrants (not born in the U.S.). About one fifth were follow-the-crop migrants (FTC) who had traveled outside the two-County (Monterey and Santa Cruz counties) area for agricultural employment;  Most households of farmworkers interviewed included non-family members who were for the most part other farmworkers. There are consistently stunningly high rates of residences that are above the severely crowded condition of 2.0 people per room. This is true of almost all the subgroups of the population. Often more than 5 people per bathroom;  About 40 percent of respondents live in houses, 30 percent in apartments. Another 19 percent live in rented rooms without kitchens – either in houses or apartments. Another 12 percent live in “other” types of dwellings. Eighty-nine percent of farmworkers were renters and 11 percent owners. Of those who reported as owners, a quarter owns mobile homes; and Other characteristics of those interviewed included:
 Most have only completed primary school;
 Wages ranged from a median of $12.79 per hour, mean of $13.64, with median annual income of $25,000;
 The majority do not work all year in agriculture – 7.5 months is the median;  44 percent of migrants work all year, 20 percent of non-migrants work year-round;  Average age at arrival is about 20;
 Median number of years in the U.S. is 15 years;
 Median age was 37;
 Median number of years with current employer is 4 years; a quarter worked for their employer for 8 years or more;
 Two-thirds are from four states in Mexico:
 Oaxaca 21 percent;
 Michoacan 19 percent;
 Jalisco 14 percent;
 Guanajuato 10 percent;
 13 percent self-identified as indigenous Mixtec, Triqui, Zapotec;  They work in a range of crops throughout the region;
 46 percent participate in harvest;
 16 percent are packers;
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Appendix A – Housing Needs and Fair Housing Report A-56 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  38 percent participate in all other farm-related tasks such as:
• Weeding;
• Irrigating;
• Thinning;
• Pruning;
• Loading;
• Driving; and
• Operating machines.

The farmworker housing demand model developed as part of the study calculates the total housing units needed of all types, based on target People Per Dwelling (PPD), and total permanent affordable farmworker housing based on the current rate that farmworkers access subsidized housing.

Key findings of the demand model were:
 An additional 33,159 units of farmworker housing are needed to alleviate critical overcrowding in farmworker households that are occupied at 7.00 PPD to the average PPD of 3.23 in Monterey County and the average PPD 2.60 in Santa Cruz County;  A total of 4,393 units of permanent affordable farmworker housing are needed to maintain the present “access rate” of 7.6 percent of farmworkers to subsidized housing; and  The data from this study indicate an overwhelming need for affordable permanent yearround family housing.

The housing needs of farmworkers are addressed under Carmel-by-the-Sea’s overall programs for affordability consistent with the California Institute for Rural Studies 2018 report. Although the City does not have agricultural uses, and therefore, no housing designated specifically for farmworkers – the City supports the County of Monterey’s efforts to educate the public on resources that are available for agricultural workers. The City has included Program 5.1.D to identify and publicize resources that are available throughout the region for agricultural employees. Additionally, Program 1.3.F establishes an amendment to the zoning code to define and permit employee housing, including agricultural employees, consistent with state law.

The City has identified the following regional service providers and programs to assist farm-worker households within the greater Monterey County region:
 Spanish Farmworkers Resource Line;
 The Center for Community Advocacy; and
 Farm and Food Worker Relief Program.

Persons Experiencing Homelessness
Homelessness remains an urgent challenge in many communities across the state, reflecting a range of social, economic, and psychological factors. Rising housing costs result in increased risks of community members experiencing homelessness. Addressing the specific housing needs for the unhoused ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-57 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 population remains a priority throughout the region, particularly since homelessness is disproportionately experienced by people of color, people with disabilities, those struggling with addiction and those dealing with traumatic life circumstances.

Table A-16 show changes in the homeless population between 2017-2022 in Carmel-by-the-Sea, the County and neighboring jurisdictions. According to the 2022 Monterey Homeless Count and Survey Comprehensive Report, Carmel-by-the-Sea has seen a decrease in homeless persons since 2017, totaling one person in 2022. Similarly, the Monterey Bay Area overall has seen a decrease in homeless populations with the exception of Seaside.

Table A-16 - Homeless Population by Jurisdiction, 2017-2022 Jurisdiction
Unsheltered Sheltered Total 2019-2022 %
2017 2019 2022 2017 2019 2022 2017 2019 2022 Change
Monterey (City) 292 167 74 46 37 27 338 204 101 -50%
Carmel-by-the-Sea 16 6 1 0 0 0 16 6 1 *
Del Rey Oaks 111 0 2 0 0 0 111 0 2 *
Seaside 40 126 90 58 56 62 98 182 152 -16%
Pacific Grove 35 14 29 0 0 0 35 14 29 *
Total 509 315 198 104 93 89 613 408 287 -66%
Source: 2022 Monterey Homeless Count and Survey Comprehensive Report NOTE: % change was not calculated when jurisdiction was below 25 individuals.

Table A-17 shows household type and shelter status in Monterey County in 2019. In Monterey County, the most common type of household experiencing homelessness are those without children in their care. Among households experiencing homelessness that do not have children, 83 percent are unsheltered. Similarly, the majority of homeless households with children are unsheltered (45 percent).

Table A-17 - Homelessness by Household Type and Shelter Status, Monterey County, 2019 Jurisdiction
People in Households
Composed Solely of
Children Under 18
People in Households
with Adults and Children
People in Households
without Children
Under 18
Count Percent Count Percent Count Percent Total
Sheltered –Emergency Shelter 0 0% 146 22% 218 11% 364
Sheltered – Transitional Housing 0 0% 218 33% 124 6% 342 Unsheltered 10 100% 303 45% 1,685 83% 2,340
Total 10 100% 667 100% 2,027 100% 2,704
Source: U.S. Department of Housing and Urban Development (HUD), Continuum of Care (CoC) Homeless Populations and Subpopulations Reports (2019). For the data table behind this figure, please refer to the Data Packet Workbook, Table HOMELS-01.

Notes: Universe: Population experiencing homelessness. This data is based on Point-in-Time (PIT) information provided to HUD by CoCs in the application for CoC Homeless Assistance Programs. The PIT provides a count of sheltered and unsheltered homeless persons on a single night during the last 10 days in January. Each Bay Area County is its own CoC, and so data for this table is provided at the county-level. Per HCD’s requirements, jurisdictions will need to supplement this county-level data with local estimates of people experiencing homelessness.

Housing and transportation costs can be barriers to residents that are experiencing homelessness. With a median home value of $2,070,835 (compared to a median home value of $561,490 in Monterey County), those experiencing homelessness would need wrap-around support, access to community services, and State/Federal assistance to end the cycle of homelessness. Many individuals that are ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-58 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 homeless may experience difficulties with: finding emergency shelter, having access to food and jobtraining resources. Lack of adequate transportation to commute to job interviews and appointments with social service providers may also be an obstacle to individuals experiencing homelessness.

The following facilities offer supportive housing services in Monterey County and Carmel-by-the-Sea for homeless and special needs low-income persons:
 Habitat for Humanity Monterey;
 Peacock Acres;
 Interfaith Outreach of Monterey;
 Community for Human Services – Casa De Noche Buena: A 20-35-beds year-round shelter for homeless women and families. Capacity depends on the number of children in families.

Provides case management, housing navigation, meals, laundry facilities, mail service, social recreation activities, and linkages to income, education, and employment. A partnership with Gathering for Women Monterey. Located at 1292 Olympia Ave., Seaside;  Community Human Services – Safe Place Youth Shelter: A 12-bed year-round shelter for youth ages 18-21. Case management is available to all clients. Check-in is from 7:00-9:00 pm.

Located at 590 Pearl Street, Monterey; and
 Interim, Inc. – MCHOME: Provides emergency shelter, outreach, housing, and intensive, integrated services to homeless adults with psychiatric disabilities. MCHOME’s goal is to move individuals with psychiatric disabilities off the street and into housing. Located in Monterey.

The majority of resources for the homeless population are provided at the county level due to a lack of need in the City, as well as a lack of resources to provide services at the City level.

A.5 Access to Opportunity
This section discusses disparities in access to opportunity among protected classes including access to quality education, employment, transportation, and environment. The California Tax Credit Allocation Committee (TCAC) in collaboration with HCD developed a series of opportunity maps that help to identify areas of the community with good or poor access to opportunity for residents. These maps were developed to align funding allocations with the goal of improving outcomes for low-income residents – particularly children.

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Appendix A – Housing Needs and Fair Housing Report A-59 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Access to Opportunity
“Access to opportunity is a concept to approximate place-based characteristics linked to critical life outcomes. Access to opportunity oftentimes means both improving the quality of life for residents of low-income communities, as well as supporting mobility and access to ‘high resource’ neighborhoods. This encompasses education, employment, economic development, safe and decent housing, low rates of violent crime, transportation, and other opportunities, including recreation, food and healthy environment (air, water, safe neighborhood, safety from environmental hazards, social services, and cultural institutions).” Source: California Department of Housing and Community Development Guidance, 2021, page 34.

The opportunity maps highlight areas of highest resource, high resource, moderate resource, moderate resource (rapidly changing), low resource, and high segregation and poverty. TCAC provides opportunity maps for access to opportunity in quality education, employment, transportation, and environment. Opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes.

Disparities in Access to Opportunity
As can be seen in Figure A-39, Carmel-by-the-Sea is considered a highest resource area as is much of western Monterey County. According to the HCD AFFH Data Viewer TCAC Opportunity Map, there are no areas of variation in access to opportunity across the City.

Economic
TCAC’s economic opportunity score is comprised of poverty, adult educational attainment, employment, job proximity, and median home value. Figure A-40 shows concentrations of economic outcomes in Carmel-by-the-Sea. According the HCD AFFH Data Viewer TCAC Economic Opportunity Map, all areas of Carmel-by-the-Sea have a high economic opportunity score of 0.75-1.0.

This reflects a high level of opportunity for economic advancement for residents in Carmel-by-the-Sea.

HUD’S Job Proximity index utilizes Longitudinal Employer-Household Dynamic estimates to examine the distance from a given neighborhood to all job locations within the Salinas-Monterey Area and measures the accessibility to job opportunities at the census block group level. Because the size of employment centers and the supply of labor differ across the region, the distance from any single job location is positively weighted by the size of employment (job opportunities) at that location and inversely weighted by the labor supply (competition) to that location.27 The higher the index value, the better the access to employment opportunities for residents in a neighborhood. 27 HUD. AFFH-T Data Documentation Data Version AFFHT0006 (2020).

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Appendix A – Housing Needs and Fair Housing Report A-60 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-39 - TCAC Opportunity Composite Score, Carmel-by-the-Sea, 2022 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-61 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-40 - TCAC Opportunity Economic Score, Carmel-by-the-Sea, 2022 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-62 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 As shown in Figure A-41, access to employment opportunities does not differ across Carmel-by-theSea. The entirety of the city has a jobs proximity index score of at least 80, indicating adequate access to employment opportunities for residents across the city.

According to data presented in Section A.2, Population, Employment, and Household Characteristics, the city is a net importer of workers (Figure A-11), which likely comes as a result of the small geographical size of the city and limited housing availability. Further, the city is a tourist destination, providing ample job opportunities to sustain the local economy. However, the combination of low housing stock and high job opportunity can perpetuate a jobs to housing imbalance. To encourage the development of a variety of new housing types affordable to a range of incomes, the City has developed a suite of programs, including Program 1.3.D, which encourages the development on on-site employee housing at overnight visitor accommodation centers in the city. See Chapter 2 for a full list of implementation programs.

It is intended that through the implementation of these housing programs, the City will enable local employees to obtain affordable housing in the city.

Education
TCAC’s education score is based on math proficiency, reading proficiency, high school graduation rates, and the student poverty rate. Opportunity scores are presented on a scale from zero to one and the higher the number, the more positive the outcomes.

Figure A-42 shows the level of TCAC educational opportunity across Carmel-by-the-Sea. According to TCAC’s Educational Opportunity Map, Carmel-by-the-Sea scores between 0.75-1.0 indicating a high level of positive educational outcomes for residents in Carmel-by-the-Sea.

Carmel-by-the-Sea is served by the Carmel Unified School District (CUSD), along with elementary, middle, and high schools within the City and school district. As of 2022, the State of California School Dashboard highlights a 97.9 percent graduation rate among all students enrolled in Carmel High School, which is higher than the statewide average (87.4 percent) and County average (88.5 percent).

When broken down by race/ethnicity, Hispanic and White students graduated at a high rate (97.4 percent for both groups). There is no performance data available for the graduation rates of African American, Asian, Filipino, and American Indian students at Carmel High.

Additionally, there is no performance data available for the graduation rates of students with a disability within Carmel High.

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Appendix A – Housing Needs and Fair Housing Report A-63 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-41 - Jobs Proximity Index, Carmel-by-the-Sea
Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-64 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-42 - TCAC Opportunity Education Score, Carmel-by-the-Sea, 2022 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-65 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Environment
TCAC’s opportunity areas environmental scores are based on the CalEnviroScreen 4.0 indicators, which identify areas disproportionately vulnerable to pollution sources such as ozone, PM2.5, diesel PM, pesticides, toxic release, traffic, cleanup sites, groundwater threats, hazardous waste, impaired water bodies, and solid waste sites.

Figure A-43 shows TCAC environmental outcomes across Carmel-by-the-Sea. According to the HCD AFFH Data Viewer TCAC Environmental Opportunity Map, Carmel-by-the-Sea scores between 0.75-

1.0 indicating a low level of environmental pollution burden and positive outcomes for residents in Carmel-by-the-Sea.

The Social Vulnerability Index (SVI) provided by the Center for Disease Control (CDC)ranks census tracts based on their ability to respond to a disaster and includes four themes of socioeconomic status, household composition, race or ethnicity, and housing and transportation.

Figure A-44 shows SVI levels across Carmel-by-the-Sea. Carmel-by-the-Sea scores low on the SVI (less than 0.25) indicating that the City is slightly vulnerable to disasters, but highly equipped to respond to them. Just outside of the City’s borders, however, vulnerability levels increase to 0.25-0.5. This is likely due to a difference in jurisdictional resources.

Disparities Specific to the Population Living with a Disability In Carmel-by-the-Sea, 12.3 percent of the population is living with at least one disability, compared to

8.8 percent in Monterey County. The most common disabilities in the City are: hearing difficulty (9.9 percent), ambulatory difficulty (4.4 percent), and independent living difficulty (4.3 percent). For the population 65 and over, the share of the population with hearing difficulties increases to 19.3 percent.

In an effort to improve accessibility features for residents living with disabilities, the City will allocate funding from its Capital Improvement Program (CIP) to improve curb cuts, sidewalks, and slopes within Carmel-by-the-Sea.

Disparities in Access to Transportation
Reliable public transit access and active transportation options (walking and biking) are imperative for low-income residents and/or persons with disabilities to connect to employment opportunities. Access to employment via public transit and active transportation can reduce income burden and increase housing mobility, which enables residents to locate housing in more areas.28 Lack of transportation options can impede fair housing choice and continue to reinforce barriers for low-income residents in accessing opportunities.
28 Ong, Paul and Evelyn Blumenberg. 1998. https://escholarship.org/uc/item/6d897664#author ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-66 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-43 - TCAC Opportunity Environmental Score, Carmel-by-the-Sea, 2022 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-67 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-44 - Social Vulnerability Index, Carmel-by-the-Sea, 2018 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-68 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Regional Trends
Monterey County generally has widespread access to public transit. Transportation Agency for Monterey County (TAMC) and Monterey-Salinas Transit (MST) all serve Monterey County. TAMC serves as the county’s regional transportation agency responsible for planning and financial programming of transportation projects in the county. Through local and statewide funding, TAMC provides funding for public transit services operated by MST. MST provides a variety of local bus services through a total of 36 routes where service originates from two primary locations: the Monterey Transit Plaza, in downtown Monterey, and the Salinas Transit Center, in downtown Salinas. From there, routes branch out through the western cities of Marina, Sand City, Monterey, Pacific Grove, Carmel-by-the-Sea, and then the eastern cities, including Salinas, Gonzales, Soledad, Greenfield, and King City. In addition, MST provides a connection to Watsonville Transit Center as the primary connector to Santa Cruz Metro to Santa Cruz and San Jose centers. MST offers a paratransit program (RIDES) in cooperation with the Americans with Disabilities Act for those who have a disability that prevents them from using MST’s regular fixed-route bus service. Each bus is equipped with a wheelchair lift, and a service corridor extends 0.75 mile from any of the MST bus routes throughout the Monterey Peninsula, Carmel-by-the-Sea, Carmel Valley, Salinas, Chualar, Gonzales, Greenfield, Soledad, and King City with connection to Watsonville Transit Center.

College students ride free with valid student photo identification during the Fall and Spring semesters.

Amtrak rail service has a station in Salinas as part of the Coast Starlight line that extends north as far as Seattle, Washington.

Monterey County received an average AllTransit performance score of 4.2 which equates to a low combination of trips per week and number of jobs accessible by transit.29 Nearly 73 percent of workers in the county live within 0.5 mile of transit. Almost all major employment centers in Monterey County are served by some form of public transit. However, having regional access to jobs by means of public transit does not necessarily translate into stable employment. Some residents with unique needs, such as households with children, have unique travel patterns that may prevent them from working far from home due to childcare needs, access to schools, and other considerations.

From a regional standpoint, MST services approximately 2.2 million passengers on an annual basis of which 76 percent of the passengers come from a historically underrepresented (non-White) background with an annual household income under $40,000.30 Monterey-Salinas Transit also reports that 25 percent of all trips begin in a disadvantaged community, and 20 percent of the passengers serviced by MST have a disability and are dependent on others for mobility and transport. Compared to all other jurisdictions serviced by MST, Carmel-by-the-Sea has the sixth highest monthly ridership (MontereySalinas Transit, 2023). 29 AllTransit.org. 2022. County: Monterey, AllTransit Metrics. https://alltransit.cnt.org/metrics/?addr=monterey+county 30 https://carmel.novusagenda.com/agendapublic/CoverSheet.aspx?ItemID=5838&MeetingID=1350 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-69 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Local Trends
In the City of Carmel-by-the-Sea, public transportation is serviced by Monterey-Salinas Transit (MST) which offers two fixed route bus lines in Carmel-by-the-Sea (Routes 5 and 94). Route 5 connects Carmel-by-the-Sea to the City of Monterey, operating from 6:15 am to 9:15 pm on weekdays and from 7:15 am to 7:15 pm on weekends. Route 94 connects Carmel-by-the-Sea to the cities of Monterey, Del Rey Oaks, and Seaside, operating from 9:50 am to 3:50 pm every day.

Carmel-by-the-Sea is generally accessible by local transit. The city has an AllTransit Performance Score of 5.4, which is slightly higher than overall Monterey County. According to AllTransit, 100 percent of workers live within one half mile of transit.31
Walk Score is a tool that produces a walkability index by assigning a numerical walkability score to cities and neighborhood. Walkability is measured by analyzing population density, distance to amenities, and road metrics such as block length and intersection density. Overall, Carmel-by-the-Sea has a walk score of 96, which is an above average walk score and indicates most daily errands do not require a car.

In an effort to lower the disparities in access to transit, the City has collaborated with MST to ensure that 100 percent of the City’s residents live within a half mile of transit stops. The City coordinates with the County of Monterey to provide transportation to elderly residents (through the Senior Rideshare Program), and individuals with disabilities through the Independent Transportation Network of Monterey (ITN Monterey) and the MST Rides ADA Paratransit Agency. Additionally, MST provides a Courtesy Card for riders that are 18 years of age and younger; 65 years of age and older; veterans; caregivers; and disabled individuals. Discounted GoPasses are available to commuters for monthly, weekly, and daily rates. Emergency Guaranteed Ride Home (EGRH) is also a service provided by MST, which provides a guaranteed ride home in an emergency to registered uses who use alternative transportation to get to work. The EGRH program is available to commuters who live or work in Monterey County and who ride the bus, carpool, vanpool, ride a bicycle or walk to work at least one day a week.

Housing Mobility Enhancement
Being that the City of Carmel-by-the-Sea is the highest resource community when compared to the rest of the region, the City will promote housing mobility as a means of removing barriers to higher opportunity areas and strategically enhancing access to housing choices and affordability to provide more inclusivity in the City and region. To enhance housing mobility, the City has included the following programs in Chapter 2 of the Housing Element:
 3.2.B: Housing Mobility;
 3.2.C: Local Universal Design Standards;
 3.2.D: Family Friendly Housing;
 1.1.D: Allow Religious Institution Affiliated Housing Development; 31 AllTransit.org. 2022. City: Carmel-by-the-Sea, AllTransit Metrics. https://alltransit.cnt.org/metrics/ ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-70 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  1.3.C: Accessory Dwelling Units;
 1.3.D: Overnight Visitor Accommodation - Employee Housing Program;  2.1.B: Permanent Housing;
 3.1.B: Housing for Extremely-Low Income Households;
 5.1.A: Fair Housing Services; and
 5.1.B: Housing Choice Voucher Program.

For a complete list of programs. Refer to Chapter 2 of the Housing Element.

A.6 Housing Stock Characteristics
Carmel-by-the-Sea’s housing stock is defined as all housing units within its jurisdiction. Characteristics of housing stock include housing type, age, condition, tenure, vacancy rates, costs, affordability, and growth. The following section provides an in-depth analysis of the housing stock in Carmel-by-the-Sea to determine how/if the current the housing stock meets the needs of existing and future residents.

Housing Growth
Table A-18 provides an overview of housing growth trends between 2010-2019 in Carmel-by-the-Sea, the County, and nearby cities. Between 2010-2019, Carmel-by-the-Sea housing unit estimates grew approximately 6 percent, more than the County and Del Rey Oaks, but 2 percent less than Pacific Grove. These estimates show the majority of housing growth in Carmel-by-the-Sea occurred between 2015-2019 (8 percent).

Table A-18 - Housing Unit Growth Trends by Jurisdiction, 2010-2019 Jurisdiction 2010 2015 2019
Percent Change
2010-2015
Percent Change
2015-2019
Monterey County 138,833 139,794 141,820 1% 1%
Carmel-by-the-Sea 3,606 3,532 3,832 -2% 8%
Del Rey Oaks 752 733 745 -3% 2%
Pacific Grove 7,723 8,411 8,347 9% -1%
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2010-2019 Housing Type
Table A-19 provides a comparison of housing unit types in Carmel-by-the-Sea, the County, and nearby cities. In Carmel-by-the-Sea, single-family detached units are the most common housing type (87 percent). This aligns with the County (63 percent), Del Rey Oaks (76 percent), and Pacific Grove (60 percent) having majority single-family detached units. Overall, Carmel-by-the-Sea has the highest percentage of single-family detached units compared to the County and nearby cities, but the lowest percentage of multifamily housing units (10 percent).

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Appendix A – Housing Needs and Fair Housing Report A-71 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-19 - Housing Units by Type by Jurisdiction, 2019 Jurisdiction
Single-Family
Detached
Single-Family
Attached Multi-Family Mobile Homes Total
Count Percent Count Percent Count Percent Count Percent Units Monterey County 88,721 63% 8,796 6% 37,734 27% 6,529 5% 141,820 Carmel-by-the-Sea 3,319 87% 54 1% 367 10% 92 2% 3,832
Del Rey Oaks 567 76% 49 7% 118 16% 11 2% 745
Pacific Grove 5,023 60% 497 6% 2,668 32% 159 2% 8,347
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019 NOTE: Table indicates total housing units.

Figure A-45 illustrates housing type trends in Carmel-by-the-Sea between 2010-2019. In 2010, the majority of housing types were single-family detached homes (82 percent); this has since increased to 87 percent in 2019. Multifamily housing (2+ units) has decreased by 3 percent since 2010 accounting for only 10 percent of housing types in 2019. In 2010, mobile homes comprised the smallest percentage of housing type in Carmel-by-the-Sea, and have since slightly increased to 2 percent in 2019.

Figure A-45 - Housing by Type in Carmel-by-the-Sea, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2010-2019 Due to the limited supply of adequately sized units to accommodate larger households, large families often face significant difficulty in locating adequately sized, affordable housing. Figure A-46 illustrates the existing housing stock by number of bedrooms in Carmel-by-the-Sea. As shown in Figure A-46, the majority of existing housing units are two- and three-bedroom units, followed by studio units.

Approximately 20 housing units include five or more bedrooms (1 percent); 176 housing units include four bedrooms (5 percent); 1,408 housing units include three bedrooms (37 percent); 1,503 housing units include two bedrooms (39 percent); 299 housing units include one bedroom (8 percent); and 426 housing units include no bedroom (11 percent).

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Appendix A – Housing Needs and Fair Housing Report A-72 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-46 - Housing Stock by Number of Bedrooms, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Housing Availability and Tenure
Housing tenure refers to individuals who own or rent a housing unit. The number of residents who own their homes compared to those who rent their homes can help identify the level of housing insecurity (i.e., ability for individuals to stay in their homes) in a city and region. Generally, renters may be displaced more quickly if prices increase. Additionally, housing tenure may be an indicator of housing affordability (i.e., if the local housing market has high barriers to entry, there may be more renter households than owner households).

In Carmel-by-the-Sea, the housing stock includes 828 renter-occupied housing units and 1,099 owneroccupied housing units (Table A-20). When analyzing housing unit type in tandem with tenure, the majority of all housing units are single-family detached (87 percent), of which 17 percent are renteroccupied and 32 percent are owner-occupied (Figure A-18; Table A-20).

Table A-20 - Housing Units by Type and Tenure, Carmel-by-the-Sea, 2019 Tenure
Single-Family
Detached
Single-Family
Attached Multi-Family Mobile Homes
Count Percent Count Percent Count Percent Count Percent Total Units Renter-Occupied 568 69% 19 2% 221 27% 20 2% 828
Owner-Occupied 1,076 98% 0 0% 23 2% 0 0% 1,099
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019 NOTE: Table indicates total occupied housing units.

Table A-21 provides an overview of household size by tenure for Carmel-by-the-Sea, the County, and nearby cities. In Carmel-by-the-Sea, the average household size is 2.04, of which the majority of larger households are comprised of renter-occupied units (2.13 persons/unit). An average household size of

2.04 suggests a need for more small housing units. This aligns with 82 percent of Carmel-by-the-Sea’s population being comprised of 1-2 person households (Figure A-14). Compared to the County and nearby cities, Carmel-by-the-Sea has the lowest average household size (2.04 persons/unit). The County has a high average household size of 3.27 suggesting a need for large housing units and even a need for smaller independent units such as ADUs/JADUs for extended family.

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Appendix A – Housing Needs and Fair Housing Report A-73 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-21 - Household Size by Tenure by Jurisdiction, 2019 Jurisdiction Owner-Occupied Renter-Occupied Average Household Size Monterey County 3.13 3.41 3.27
Carmel-by-the-Sea 1.97 2.13 2.04
Del Rey Oaks 2.29 2.49 2.35
Pacific Grove 2.34 2.15 2.23
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Figure A-47 illustrates 2019 household tenure by race in Carmel-by-the-Sea. Tenure by race varies some in Carmel-by-the-Sea as the majority of all households are non-Hispanic White (87 percent), of which 58 percent are owner-households and 42 percent are renter-households (Figure A-4; Figure A-45).

Hispanic or Latino households (8 percent) makeup the second largest population in Carmel-by-the-Sea, of which 72 percent are owner-households and 28 percent are renter-households. Less than 1 percent of Black or African American, Native Hawaiian or Other Pacific Islander, and American Indian or Alaska Native households are represented in the City’s housing market.

Figure A-48 illustrates vacancy rates in Carmel-by-the-Sea, the County, and nearby cities. Carmel-bythe-Sea has a vacancy rate of 50 percent. This reflects a 40 percent higher vacancy rate than the County (10 percent) and 32 percent higher than Pacific Grove (18 percent).

Figure A-49 illustrates vacancy trends in Carmel-by-the-Sea from 2010-2019. Over the course of nearly a decade, the City has experienced a stable vacancy average of 51 percent. This is staggeringly high considering the current housing crisis. Additionally, this affects the accuracy of data reporting for the City, as the majority of homeowners do not live in Carmel-by-the-Sea full time, thus resulting in skewed data collection.

Figure A-47 - Household Tenure by Race, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
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Appendix A – Housing Needs and Fair Housing Report A-74 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-48 - Vacancy Rates by Jurisdiction, 2019
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Figure A-49 - Vacancy Trends, Carmel-by-the-Sea, 2010-2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Table A-22 shows vacant housing units by type, revealing 80 percent of Carmel-by-the-Sea’s vacant units are for seasonal, recreational, or occasional use, aligning with the 51 percent average vacancy trends (Figure A-49). The high percentage of vacant housing units is largely impacted by tourism and second-home ownership. This creates a significant barrier for current and potential residents to enter the local housing market and hinders opportunities to correct the housing crisis, address diversity, and provide inclusive housing options to promote a vibrant and active community.

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Appendix A – Housing Needs and Fair Housing Report A-75 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-22 - Vacant Housing Units by Type, Carmel-by-the-Sea, 2019 Housing Unit Type Estimate Percentage
For rent 96 5%
Rented, not occupied 12 1%
For sale only 11 1%
Sold, not occupied 49 3%
For seasonal, recreational, or occasional use 1,522 80% For migrant workers 0 0%
Other vacant 215 11%
Total 1,905 100%
Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
Table A-23 shows housing permits issued by the City of Carmel-by-the-Sea by income group. Between 2015 and 2021, 18 housing units were issued permits in Carmel-by-the-Sea which represents 58 percent of the RHNA number of 31 units assigned in the 5th Cycle Housing Element.

Table A-23 - Housing Permits by Income Group, Carmel-by-the-Sea, 2015-2021 Income Group Number Percent
Very Low-Income Permits 0 0.0%
Low-Income Permits 0 0.0%
Moderate-Income Permits 0 0.0%
Above Moderate-Income Permits 18 58.0%
Total 18 58.0%
Source: California Department of Housing and Community Development (HCD), 5th Cycle Annual Progress Report Permit Summary (2022).

Note: Universe: Housing permits issued between 2015 and 2021. Notes: HCD uses the following definitions for the four income categories: Very Low Income: units affordable to households making less than 50 percent of the Area Median Income for the county in which the jurisdiction is located. Low Income: units affordable to households making between 50 percent and 80 percent of the Area Median Income for the county in which the jurisdiction is located. Moderate Income: units affordable to households making between 80 percent and 120 percent of the Area Median Income for the county in which the jurisdiction is located. Above Moderate Income: units affordable to households making above 120 percent of the Area Median Income for the county in which the jurisdiction is located.

Assisted Housing Developments At-Risk of Conversion
While there is an immense need to produce new affordable housing units, ensuring that the existing affordable housing stock remains affordable is equally important. Additionally, it is typically faster and less expensive to preserve currently affordable units that are at risk of converting to market-rate than it is to build new affordable housing.

The California Housing Partnership Preservation Database is the state’s most comprehensive source of information on subsidized affordable housing at risk of losing its affordable status and converting to market-rate housing.32 According to the database, there are no federal or state assisted units in Carmelby-the-Sea. 32 This database does not include all deed-restricted affordable units in the state, so there may be at-risk assisted units in a jurisdiction that are not captured.

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Appendix A – Housing Needs and Fair Housing Report A-76 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 A variety of affordable housing projects provided through an assortment of local programs serves the Carmel-by-the-Sea. Each of the following projects serves as an example of the methods and incentives used by the City to achieve production of affordable housing units.

Oliver White Building and Viejo Carmel
The mixed-use Oliver White building contains four residential units, one of which is a ModerateIncome unit in perpetuity. Originally this site was developed with a single-story commercial building.

The owner and City worked together to achieve a second story of residential apartments at a density of 44 units per acre.

The Viejo Carmel project is a larger example of infill development that provides affordable housing.

The 20,000 square-foot site was occupied by semi-industrial uses and offices. The site was razed and redeveloped with ten condominiums and ten apartments at a density of 44 units per acre. Without density bonuses, the site could only achieve 15 residential units. With density bonuses, an additional two Low-Income rental apartments in perpetuity were approved. Additionally, the parking requirement for the low-income units was reduced.

Norton Court Apartments
The Norton Court Apartments for seniors is operated by the Carmel Foundation. As part of this 24- unit project, the City entered into a 50-year agreement to lease the property for one dollar per year to the Carmel Foundation. This amounts to a substantial land subsidy provided by the City that offsets a large part of the cost of developing housing. The units are restricted as Low- and Moderate-Income.

Rents are maintained as affordable to lower-income seniors strictly through private donations raised by the Carmel Foundation.

Trevvett and Haseltine Courts
Trevvett and Haseltine Courts were developed with funding from the Carmel Foundation. Rents for the combined 26 rental apartments are maintained as affordable to lower-income seniors with private donations raised by the Foundation.

San Carlos Lodge
This site was granted a major addition and allowed the conversion of some existing apartments to transient overnight visitor accommodation units. As a condition, the project retained two of the existing apartments as affordable housing for Moderate-Income households in perpetuity.

The City’s inventory of affordable units is listed below in Table A-24.

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Appendix A – Housing Needs and Fair Housing Report A-77 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-24 - Inventory of Assisted Rental Housing
Development Name Total Units Household Type Provided By Expiration of
Affordability
Oliver White 1 Moderate Density Bonus In perpetuity
Viejo Carmel 2 Low Density Bonus In perpetuity
Norton Court 24 Senior Low Lease Subsidy
Specific Plan
Not defined
San Carlos Lodge 2 Moderate Condition of Approval In perpetuity Trevvett Court 14 Senior, Very-Low &
Low
Private non-profit
Specific Plan
30 years
Haseltine Court 12 Senior Private non-profit Not applicable Hasegawa 1 Low Inclusionary In perpetuity
Carl 1 Senior Inclusionary 2027
Mandurrago 2 Senior Inclusionary In perpetuity
Gonzales 1 Low Inclusionary In perpetuity
Ravel Corporation 1 Low Inclusionary In perpetuity
Trini Iye 1 Moderate Inclusionary In perpetuity
Total 62
Source: City of Carmel-by-the-Sea Community Planning and Building Department, 2023 Potential Loss of Assisted Housing Units
Housing units developed with public subsidies are an important source of affordable housing to lowerincome households. Preserving the long-term affordability of such housing units is the most costeffective means for providing decent and affordable housing in a community. Recognizing this important resource, State Housing Element law requires that a jurisdiction examine the potential loss of publicly subsidized multi-family rental housing for lower-income household due to expiration of deed restrictions, affordability covenants, and /or subsidy contracts. All of the affordable housing units in Carmel are privately funded.

Norton Court, Trevvett Court, and Haseltine Court are operated by the Carmel Foundation, a 501(c)(3) charitable organization providing affordable senior housing units. The Foundation does not accept government funding. The Foundation currently has a 5-7 year wait list on these properties and does not intend to convert any units to market rate housing within this Housing Element cycle.

Norton Court receives a subsidized property lease from the City, and is located within a Specific Plan area that requires “24 efficient and moderately priced housing units for the elderly and handicapped residents of Carmel-By-The-Sea”. Further, the Specific Plan requires 21 studio units at 500 square feet each and 3 one-bedroom units at 572 square feet each.

Trevvett Court is also located within a Specific Plan area that requires “all 14 units be reserved for senior citizens of low or very low-income status for a period of at least 30 years.” Housing units within Trevvett Court range from 400-600 square feet in size.

Units in the Oliver White Building, Viejo Carmel, and Sand Carlos Lodge are restricted as affordable housing in perpetuity.

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Appendix A – Housing Needs and Fair Housing Report A-78 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 One unit in the Carl development is listed with an expiration date of 2027. City staff are further researching the terms of this affordable unit. To maintain the existing affordable housing stock, the City can either preserve the existing affordable units or facilitate the development of new units.

Depending on the circumstances of at-risk projects, different options may be used to preserve or replace the units. Preservation options typically include: 1) construction of replacement units; 2) provision of rental assistance to tenants; 3) transfer of the project to nonprofit ownership; and 4) purchase of affordability covenants. These options are described below and the City’s focus is on construction of replacement units and rental assistance.

Construction of Replacement Units
The construction of new affordable housing units is a means of replacing the at-risk units should they be converted to market-rate units. The cost of developing housing depends on a variety of factors, including density, size of the units (i.e. square footage and number of bedrooms), location, labor, materials and land costs, and type of construction. The City is implementing a number of programs to encourage development of new affordable units to increase the City’s affordable housing stock.

Rental Assistance
Rental subsidies using non-federal (state, local, or other) funding sources can be used to maintain affordability of at-risk units. These rent subsidies can be structured to mirror the federal Housing Choice Voucher (Section 8) program. Under Section 8, HUD pays the difference between what tenants can pay (defined as 30 percent of household income) and what HUD estimates as the fair market rent on the unit. The feasibility of this alternative is highly dependent on the availability of other funding sources necessary to make rent subsidies available and the willingness of property owners to accept rental vouchers if they can be provided. Housing Choice Vouchers are available through the Housing Authority of Monterey County.

Transfer of Ownership
Transferring ownership of an at-risk project to a nonprofit housing provider is generally one of the least costly ways to ensure that at-risk units remain affordable for the long term. By transferring property ownership to a nonprofit organization whose mission includes affordable housing, the risk of losing the low-income restrictions is minimized, and the project would become potentially eligible for a greater range of governments assistance.

Purchase of Affordability Covenants
Another option to preserve the affordability of at-risk projects is to provide an incentive package to the owners to maintain the projects as affordable housing. Incentives could include bringing down the interest rate on the remaining loan balance, providing loans for capital improvements, and/or supplementing subsidies. The feasibility of this option depends on whether the complex is too highly leveraged. By providing lump sum financial incentives or ongoing subsidies in the form of rents or ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-79 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 reduced mortgage interest rates to the owner, the City can ensure that some of all of the units remain affordable.

Displacement
Because of increasing housing prices, displacement is a major concern in the Monterey Bay Area.

Displacement has the most severe impacts on low- and moderate-income residents. When individuals or families are forced to leave their homes and communities, they also lose their support network.

According to the California Department of Housing and Community Development (HCD) AFFH Data Viewer and the Urban Displacement Project 2022 estimates, Carmel-by-the-Sea renter-occupied households earning between 0-80 percent AMI are at low risk of potential displacement or gentrification in the northern region of the City. Mapping of the central and southern regions of the City show sufficient data was not captured to definitively report displacement risk. Figure A-51 illustrates displacement risk in Carmel-by-the-Sea.

Housing Age and Condition
Housing age and condition are factors considered in overall housing quality as they may affect the structural integrity and ability to adequately function for a household. Thus, the age and condition of a house may indicate the need for major repairs to the foundation, plumbing, or roof.

Figure A-50 illustrates housing stock by age in Carmel-by-the-Sea. In Carmel-by-the-Sea, 95 percent of the housing stock was built prior to 1999 and is over 20 years old. Thirty-seven (37) percent of the housing stock was built between 1940-1959 and 2 percent was built in 2010 or later.

Figure A-50 - Housing Stock by Age, Carmel-by-the-Sea, 2019 Source: U.S. Census Bureau, ACS 5-Year Estimate, 2019
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Appendix A – Housing Needs and Fair Housing Report A-80 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-51 - Displacement Risk, Carmel-by-the-Sea, 2022 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-81 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 According to historical data from Carmel-by-the-Sea’s Code Compliance Coordinator, the City estimates that there are approximately five-six (5-6) units in need of rehabilitation. This 6th Cycle Housing Element proposes the following policies and programs to address and facilitate the rehabilitation of these units.
 Policy 2.1: Maintain and encourage expansion of permanent residential housing stock in the Commercial, R-1, and R-4 Districts;
 Policy 2.2: Preserve and protect the scale and character of established neighborhoods while encouraging property improvement;
 Policy 2.3: Preserve and expand affordable and rental housing opportunities to enable local employees to live in the community where they work; and  Policy 2.4: Preserve the existing housing stock.

All programs and policies can be found in Chapter 2 of the Housing Element.

The City’s Code Compliance Officer works to educate property owners about income-based financing opportunities for the rehabilitation of substandard units. Code Compliance receives a limited number of complaints related to Health and Safety and associated substandard units. Over the last four years Code Compliance has received 11 property maintenance complaints and approximately five to six of these cases indicated a need for repairs related to substandard housing issues. Cases are complaint driven and the city does not reach out to property owners with methods to fund repairs.33 According to Code Compliance records from October 202334 and November 2023,35 the majority of property maintenance complaints include conducting remodeling work and electrical maintenance without the proper permits and authorization. Based on Code Compliance records and on-site local knowledge, the complaints are spread across the city. However, the southern region of the city has received complaints more frequently than other areas in the city.

As indicated by the 102 building permit applications received by the City in October and November of 2023 (49 building permits as of October 2023 and 53 building permits as of November 2023), many residents in Carmel-by-the-Sea are interested in maintaining the upkeep of their residences, and fixing any structural issues that may need to be repaired – to prevent their residences from becoming “substandard.” However, to the City's knowledge, all units have a functioning kitchen, indoor plumbing, and electricity, and are not “substandard.” The majority of building permit applications include new roofing; electrical repairs; plumbing repairs; water heater replacement; window replacement; bathroom remodels; foundation upgrades; and exterior repairs (new paint/siding). As a proactive measure and to assist low-income property owners, the City will distribute information on inspection services, housing rehabilitation programs, and alternative ways to finance home repairs (Program 2.4.A, see Chapter 2). Based on Code Compliance reports, the City will specifically monitor and provide resources to residential units located in the southern region of the city. 33 Correspondence with Code Compliance Officer December 15, 2023 34 https://carmel.novusagenda.com/agendapublic/CoverSheet.aspx?ItemID=5833&MeetingID=1505 35 https://carmel.novusagenda.com/agendapublic/CoverSheet.aspx?ItemID=5929&MeetingID=1543 ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-82 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Housing Costs and Affordability
Identifying the cost of owning or renting a home in a city helps determine the affordability of housing at different income levels. Understanding housing affordability also informs what types and sizes of housing are needed by the community’s households.

Home Prices and Rental Costs
Table A-25 show changes in median home values between 2019-2022 in Carmel-by-the-Sea, the County and nearby cities. According to Zillow Home Value Index data, the median home value in Carmel-bythe-Sea was estimated at $1,299,387 in December 2019. By 2022, the median home value in Carmel-bythe-Sea increased approximately 59 percent due to market demand. By comparison, the median home value in the County was valued at $561,490 in December 2019 and experienced a 39 percent increase by 2022.

Table A-25 - Median Home Value by Jurisdiction, 2019-2022 Jurisdiction
Median Home Value Percent Change
2019 2020 2021 2022 2019-2022
Monterey County $561,490 $632,834 $735,469 $778,164 39% Carmel-by-the-Sea $1,299,387 $1,450,127 $1,912,421 $2,070,835 59% Del Rey Oaks $630,204 $701,060 $779,099 $840,663 33%
Seaside $550,015 $616,786 $690,126 $729,055 33%
Pacific Grove $943,900 $1,032,675 $1,237,054 $1,294,881 37% Source: Zillow Home Value Index, 2019-2022
Note: Housing value estimates were taken from December for years 2019-2022.

Rental Affordability
Similar to home value prices, rental prices have also increased over the last decade. This significantly affects lower-income households as they are typically majority renters. High rental prices can exacerbate housing challenges such as overcrowding and cost burden if adequate rental stock is not available to suit household needs.

Table A-26 shows average rent estimates by unit size in Carmel-by-the-Sea based on 2023 Zillow rental market data. Included in the table is Housing and Urban Development’s (HUD) Fair Market Rents (FMR) for 2023, which establishes rental subsidy limits for Section 8 housing voucher recipients.

Table A-26 - Average Rent by Number of Bedrooms, Carmel-by-the-Sea, 2023 Unit Type Average Rents Fair Market Rents (HUD)
Studio $2,200 $2,112
One bedroom $2,500 $2,194
Two bedrooms $4,000 $2,675
Three bedrooms $5,459 $3,790
Four+ bedrooms n/a $4,144
Source: Zillow, 2023; HUD, Fair Market Rent Documentation System, 2023 Notes: Zillow rental value estimates were taken from March 2023. No rental units with four + bedrooms are listed as available within the Carmelby-the-Sea City boundary. Fair Market Rent values are based on Salinas, CA MSA ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-83 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Table A-27 reports the maximum monthly housing costs affordable to households according to income group in Monterey County. Income groups are based on the HCD 2022 State Income Limits Report, which considers housing affordable assuming a household can pay up to 30 percent of its monthly income toward housing. In Table A-27, maximum affordable sales prices are based on the following assumptions: 6.42 percent interest rate,36 30-year fixed loan, and a 5 percent down payment.

Table A-27 - Housing Affordability, Carmel-by-the-Sea, 2022 Income Group HCD Income Limits
Maximum Affordable Price
Monthly Rental Ownership
Extremely Low (0-30% AMI)
One Person $23,900 $598 $100,340
Two Person $27,300 $683 $114,614
Three Person $30,700 $768 $128,889
Four Person $34,100 $853 $143,163
Very Low (30-50% AMI)
One Person $39,800 $995 $167,093
Two Person $45,500 $1,138 $191,024
Three Person $51,200 $1,280 $214,954
Four Person $56,850 $1,421 $238,675
Low (50-80% AMI)
One Person $63,700 $1,593 $267,433
Two Person $72,800 $1,820 $305,638
Three Person $81,900 $2,048 $343,843
Four Person $91,000 $2,275 $382,048
Moderate (80-120% AMI)
One Person $75,650 $1,891 $317,603
Two Person $86,500 $2,163 $363,155
Three Person $97,300 $2,433 $408,497
Four Person $108,100 $2,700 $453,839
Source: California Department of Housing and Community Development, State Income Limits, 2022, Monterey County As mentioned in Table A-25, the median home price in Carmel-by-the-Sea in December 2022 was $2,070,835 which is only affordable to above moderate-income households earning approximately $495,000 or more annually (62 percent of Carmel-by-the-Sea households are categorized as above moderate-income).
36 Interest rate based on December 29, 2022 interest rate according to Freddie Mac Primary Mortgage Market Survey ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-84 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 A.7 Fair Housing Enforcement and Outreach Capacity
This section discusses fair housing legal cases and inquiries, fair housing protections and enforcement, and outreach capacity.

Fair Housing Legal Cases and Inquiries
California fair housing law extends beyond the protections in the Federal Fair Housing Act (FHA). In addition to the FHA protected classes – race, color, ancestry/national origin, religion, disability, sex, and familial status – California law offers protections for age, sexual orientation, gender identity or expression, genetic information, marital status, military or veteran status, and source of income (including federal housing assistance vouchers).

The California Department of Fair Employment in Housing (DFEH) was established in 1980 and is now the largest civil rights agency in the United States. According to their website, the DFEH’s mission is, “to protect the people of California from unlawful discrimination in employment, housing and public accommodations (businesses), and from hate violence and human trafficking in accordance with the Fair Employment and Housing Act (FEHA), Unruh Civil Rights Act, Disabled Persons Act, and Ralph Civil Rights Act.”37
DFEH receives, evaluates, and investigates fair housing complaints. DFEH plays a particularly significant role in investigating fair housing complaints against protected classes that are not included in federal legislation and therefore not investigated by HUD. DFEH’s website provides detailed instructions for filing a complaint, the complaint process, appealing a decision, and other frequently asked questions.38 Fair housing complaints can also be submitted to HUD for investigation.

Additionally, Monterey County has a number of local resource and enforcement organizations:
 The Housing Authority of the County of Monterey: A public agency that provides rental assistance and develops and manages affordable housing throughout Monterey County, California;
 South County Housing: A non-profit community development corporation. The organization’s mission is to promote viable neighborhoods that enhance healthy, sustainable communities by collaboratively providing affordable housing and promoting neighborhood services;
 Public Interest Law Project: a nonprofit support center for California legal services and other public interest law programs. The California Affordable Housing Law Project (CAHLP) is a project of the Public Interest Law Project. CAHLP concentrates primarily on the enforcement of California’s Housing Element and redevelopment statutes and of state and federal relocation assistance and fair housing laws;  Coalition of Homeless Service Providers: Advocate on the subject of homelessness with policy makers, public funders, and those with lived experience; and 37 From State of California, Civil Rights Department
38 From State of California, Civil Rights Department Complaint Process ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-85 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  California Rural Legal Assistance (CRLA): a nonprofit legal service program created to help California’s low-income individuals and communities. CRLA provides low-income rural Californians with free legal assistance and a variety of community education and outreach programs. Half of its resources are committed to multi-client cases that grapple with the root causes of poverty, with the goal of improving conditions for farmworkers, single parents, school children, the elderly, people with disabilities, and entire communities.

Between 2012 and 2017, 53 fair housing complaints in Monterey County had been filed with the California Department of Fair Employment and Housing (DFEH). Among the complaints countywide, most were related to physical disabilities (23 instances) and familial/marital status (ten instances).

Discrimination based on race was also common (seven instances). A complaint may involve multiple acts of discrimination and vice versa. A total of 57 acts of discrimination were recorded in Monterey County. Refusal to rent (17 instances), discriminatory statements (12 instances), and denial of reasonable accommodation/modifications (12 instances) were the most common discriminatory acts in the County.39
In 2020, a total of six discrimination cases were found with the Office of Fair Housing and Equal Opportunity. Fifty percent of the cases were filed on the basis of disability bias. None of the complaints alleged racial bias. Figure A-52 illustrates that out of all of the FHEO cases filed in the state of California in 2020 (398), only between 1 and 2.5 percent of the cases were filed in Monterey County.

None of the discrimination cases filed in Monterey County in 2020 took place in Carmel-by-the-Sea.40 A total of six discrimination complaints were filed within Monterey County during 2020. Of those cases, three of them alleged discrimination based on disability. Figure A-53 illustrates this statistic by showing that 40.01 to 65 percent of the cases filed in Monterey County during 2020 reflected disability bias. None of the FHEO complaints occurred in the City of Carmel-by-the-Sea.

NFHA identifies three significant trends in 2020 that are relevant for this AFFH:
 First, fair lending cases referred to the Department of Justice from federal banking regulators has been declining, indicating that state and local government entities may want to play a larger role in examining fair lending barriers to homeownership;  Second, NFHA identified a significant increase in the number of complaints of harassment – 1,071 complaints in 2020 compared to 761 in 2019; and
 Finally, NFHA found that 73 percent of all fair housing complaints in 2020 were processed by private fair housing organizations, rather than state, local, and federal government agencies – reinforcing the need for local, active fair housing organizations and increased funding for such organizations.41
39 From California Department of Fair Employment & Housing, 2018; Monterey County Regional Analysis of Impediments to Fair Housing Choice, 2019
40 City of Carmel-by-the-Sea, 2023
41 From Gentry, A. (2021, September 4). Annual fair housing report shows increase in housing harassment. NFHA ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-86 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-52 - FHEO Cases Total, Monterey County, 2020
Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-87 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-53 - FHEO Cases, Disability Bias, Monterey County, 2020 Source: California Department of Housing and Community Development AFFH Data Viewer ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-88 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Outreach and Capacity
Currently, Carmel-by-the-Sea’s website contains information about local fair housing ordinances. The website describes the steps residents should take if they feel they have faced discrimination and are seeking information about filing complaints (e.g., link to HUD’s and State of California fair housing pages). The site also references the organizations that provide fair housing services and assistance to City residents.

The following organizations offer fair housing services and assistance to the residents of Carmel-by-theSea:
 Conflict Resolution and Mediation Center;
 Legal Services for Seniors;
 California Rural Legal Assistance;
 ECHO Fair Housing Services
 HUD Housing Assistance;
 Central Coast Center for Independent Living; and
 Center for Community Advocacy.

Compliance with State Fair Housing Law
The City of Carmel-by-the-Sea complies with existing fair housing laws and regulations by ensuring all residents have equal access to housing programs, services, and resources and supporting residents in filing complains on housing discrimination. Carmel-by-the-Sea is compliant with the following State laws that promote fair and affordable housing. The City has not been alleged or found in violation of the following:
 Fair Housing Act of 1968 – The City has adopted housing policies that prohibit housing discrimination based on protected characteristics and ensuring equal access to housing programs and services.
 California Fair Employment and Housing Act (FEHA) (Part 2.8 (commencing with Section 12900) of Division 3 or Title 2) – The City complies with the Fair Employment and Housing Act by upholding policies that prohibit housing discrimination based on protected characteristics and enforces these policies by supporting residents seeking to file a complaint to the FHEO or who wish to pursue legal action.
 Government Code §65008 – The City does not discriminate or deny any individual or group of individuals the right to residence, land ownership, tenancy, or other land use on the basis of one’s membership or perceived membership in a protected class, method of financing, and/or the intended occupancy. The City has adopted housing policies that prohibit discrimination based on protected characteristics. Further, the City has received zero FHEO complaints, and is committed to conducting outreach and educating residents on Fair Housing Law. Program 5.1.A in this Housing Element commits the City to providing information on fair housing and services offered in the region (see Chapter 2).

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Appendix A – Housing Needs and Fair Housing Report A-89 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  Government Code §11135 et. seq. – The City does not discriminate or deny any individual or group of individuals access to programs or activities operated, administered, or funded with financial assistance from the state, regardless of one’s membership or perceived membership in a protected class. The City included Programs 5.1.B, 5.1.C, and 5.1.D in this Housing Element to promote affordable housing opportunities and resources, including Housing Choice Vouchers, shared housing programs, and farmworker housing resources (see Chapter 2).
 Assembly Bill 686 – The City has included this assessment of fair housing and identifies strategies to increase housing opportunities for all residents, with specific actions to reduce housing disparities for disadvantaged communities.
 Density Bonus Law – The City last updated their Density Bonus provisions in the Municipal Code in 2016. In compliance with State law, the City will update its Density Bonus provisions outlined in the Municipal Code to be consistent with recent changes to the State Density Bonus Law. Program 3.1.C will regulate this amendment to the Code.  Senate Bill (SB) 35 – The City was previously not subject to the requirements of SB 35 due to its location in the coastal zone. However, as of October 2023, SB 423 now expands SB 35 measures to cities located in the coastal zone under specific criteria. The City is now subject to SB 35 and SB 423 requirements and will comply with State law as established in this Housing Element through Program 1.3.H (see Chapter 2).
 Rehabilitation Act of 1973 – The City does not discriminate against persons with disabilities and promotes equal opportunities, accessibility, and independence for individuals with disabilities.
 American Disabilities Act – The City’s Municipal Code establishes procedures for persons with disabilities seeking equal access to housing including reasonable accommodation for persons with disabilities. The City ensures housing developers comply with the American Disabilities Act through permit process review. The City includes Program 3.2.A to amend the Municipal Code regulations related to reasonable accommodations (see Chapter 2).  Housing Accountability Act (Gov. Code. §65589.5) requiring adoption of a Housing Element and compliance with RHNA allocations – The City will comply with the Housing Accountability Act by approving any eligible housing development projects, including those with at least 20 percent affordable units to lower-income households.  No Net Loss Law (Gov. Code §65863) requiring that adequate sites be maintained to accommodate unmet RHNA allocations – The City complies with the No Net Loss Law by identifying sites that can accommodate the City’s RHNA. The City also maintains minimum density requirements for multi-family housing developments in the R-4 district. To further encourage the development of affordable housing, the City is committed to amending the Municipal Code to amend the base zoning for the SC, RC, and CC commercial districts and the R-4 multi-family residential development district to allow a minimum of 33 dwelling units per acre.

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Appendix A – Housing Needs and Fair Housing Report A-90 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025  Limits on Growth Controls Law (Gov. Code. §65302.8) – The City complies with the Limits on Growth Controls Law. The City is surrounded by County development and has not adopted any mandatory general plan elements which limit the number of housing units.  Housing Element Law (Gov. Code §65583(c)(5),(c)(10) – The City has included this analysis of fair housing and identifies strategies to increase housing opportunities for all residents, with specific actions to reduce housing disparities for lower-income households.

Housing Specific Policies Enacted Locally
The City of Carmel-by-the-Sea identified the following local policies that contribute to the regulatory environment for affordable housing development in the City:

Policy 1.1: Ensure adequate sites are available to meet the City’s projected housing growth needs.

Policy 1.3: Reduce or eliminate governmental constraints on the provision of affordable housing. Direct public funding resources to the conservation of existing housing units in neighborhoods where continued residential use is appropriate.

Policy 2.3: Preserve and expand affordable and rental housing opportunities to enable local employees to live in the community where they work.

Policy 2.4: Preserve the existing housing stock.

Policy 3.2: Recognize the special needs of persons with disabilities and the need to retain flexibility in the design review process to accommodate these needs.

Fair Housing and Sites Inventory Assessment
This portion of the Housing Needs and Fair Housing Report analyzes the relation between the housing opportunity sites and AFFH (affirmatively furthering fair housing)-related issues. Government Code §65583(c)(10) requires the housing opportunity sites to be analyzed with respect to AFFH to ensure that sites designated for low-income households are dispersed equitably throughout the city rather than concentrated in areas of high segregation and poverty or low-resource areas that have historically been underserved, and conversely, that sites designated for above moderate-income households are not concentrated in areas of high resources. By comparing the Site Inventory to the fair housing indicators in this assessment, this section analyzes whether the sites included in the Housing Element Site Inventory improve or exacerbate fair housing conditions, patterns of segregation, and access to opportunity. The City’s sites inventory is shown in Figure A-54 and includes pending projects, potential hotel-to-residential conversion sites, religious facility properties, potential live/work units and, mixed income incentive program sites, and as well as additional opportunity sites. As the specific hotels to participate in the conversion program cannot be determined at this time, this figure illustrates the location of all hotels in the City except those in single-family zones. The sites inventory is described in detail in Appendix C of this Housing Element.

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Appendix A – Housing Needs and Fair Housing Report A-91 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-54 - Sites Inventory
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Appendix A – Housing Needs and Fair Housing Report A-92 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Segregation and Integration
Race/Ethnicity
According to HCD AFFH Data Viewer 3.0 estimates (2022 Census), less than 20 percent of the population in both Carmel block groups belong to non-White groups. The northern block group has a slightly larger non-White population (14.8 percent) compared to the southern block group (5.6 percent). However, populations are predominantly White citywide. As shown in Figure A-55, opportunity sites for hotel to residential conversions are scattered throughout the City and are not concentrated in a single area. Approximately 39 percent of hotel conversion opportunity sites are in the south block group and 61 percent are in the north block group.

Amongst all other RHNA sites (pending projects, religious facility properties, live/work units, mixed income incentive program sites, and additional opportunity sites), 57 percent are in the north block group and 43 percent are in the south block group. A slightly larger proportion of lower income RHNA units are in the south block group (54 percent) compared to the north block group (46 percent).

The City’s RHNA strategy does not concentrate units of any income level in neighborhoods with heightened non-White populations. As discussed above, the City as a whole is predominantly White and sites of all types are scattered throughout Carmel-by-the-Sea.

Persons with Disabilities
According to HCD AFFH Data Viewer 3.0 estimates (2018-2022 ACS), both Carmel tracts have populations of persons with disabilities representing between 10 and 20 percent of the tract population.

Populations of pPersons with disabilities in the north and south tracts are comparable (15.6 percent and

10.5 percent, respectively). As discussed above, RHNA sites are distributed throughout the City and are not concentrated in a single neighborhood alone. Further, there are no concentrations of RHNA units of any income level in areas with uniquely high or low populations of persons with disabilities.

Familial Status
Most children (>80 percent) in both Carmel-by-the-Sea tracts live in married couple households.

Further, less than 11 percent of children in both tracts live in single-parent female-headed households.

In the southern tract, 100 percent of children reside in married couple households. A slightly larger proportion of RHNA units (not including hotel conversion sites) are in the southern tract compared to the northern (80 lower income units vs. 69 lower income units, respectively). Hotel conversion sites are distributed throughout the City and are not concentrated in a single neighborhood alone. There are no areas with acutely large populations of children residing in single-parent households. Further, the City’s sites strategy does not concentrate RHNA units of any income level in a single area of the City alone.

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Appendix A – Housing Needs and Fair Housing Report A-93 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-55 - Sites Inventory and Non-White Population by Block Group (2022) ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-94 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Income
The sites inventory and low to moderate income (LMI) populations are shown at the block group-level in Figure A-56. LMI populations are based on HCD AFFH Data Viewer 3.0 estimates (HUD 2024) and are considered tracts or block groups with LMI populations exceeding 50 percent. The block group encompassing the central area of the City has the largest LMI population of 58.3 percent and is the only block group in Carmel-by-the-Sea that is considered an LMI area.

As shown in Table A-28 and Figure A-56 below, hotel to residential conversion opportunity sites are distributed throughout the City in all four Carmel-by-the-Sea block groups. Most hotel sites (63.8 percent) are in block groups that are not considered LMI areas, while 36.2 percent are in the central block group where 58.3 percent of households are low or moderate income. Amongst all other RHNA units, 57 percent are in the block group that is considered an LMI area (Table A-29). However, RHNA units are not concentrated in the LMI area alone. Housing opportunities have been identified citywide and are not concentrated in a single neighborhood. The distribution of RHNA units throughout block groups with variable LMI household populations aims to increase housing mobility by providing new housing opportunities citywide, and serve existing communities in need of additional housing opportunities.

Table A-28 - Distribution of Potential Hotel-to-Residential Conversion Opportunity Sites by LMI Population (2024)
LMI Population (Block Group) Hotel Rooms Percent
<25% 252 25.2%
25-50% 385 38.5%
50-75% 362 36.2%
>75% 0 0.0%
Total 999 100.0%
Source: HCD AFFH Data Viewer 3.0, HUD 2024.

Table A-29 - Distribution of RHNA Units by LMI Population (2024) LMI Population
(Block Group)
Lower Moderate Above Moderate Total
Units Percent Units Percent Units Percent Units Percent <25% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
25-50% 69 46.3% 1 50.0% 32 37.2% 102 43.0%
50-75% 80 53.7% 1 50.0% 54 62.8% 135 57.0%
>75% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
Total 149 100.0% 2 100.0% 86 100.0% 237 100.0%
Source: HCD AFFH Data Viewer 3.0, HUD 2024.

Note: Includes pending projects, religious facility properties, live/work units, mixed income incentive program sites, and additional opportunity sites.

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Appendix A – Housing Needs and Fair Housing Report A-95 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-56 - Sites Inventory and LMI Population by Block Group (2024) ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-96 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Racially/Ethnically Concentrated Areas
Racially/Ethnically Concentrated Areas of Poverty (R/ECAPs) and TCAC Areas of High Segregation and Poverty
There are no HUD R/ECAPs or TCAC/HCD areas of high segregation and poverty that have been identified in Carmel-by-the-Sea. Therefore, no RHNA units are located in areas with these designations.

Racially Concentrated Areas of Affluence (RCAA)
There are no RCAAs that have been identified in Carmel-by-the-Sea. Therefore, no RHNA units are located in areas with this designation.

Access to Opportunities
Both Carmel-by-the-Sea tracts are considered TCAC/HCD highest resource areas. Therefore, all RHNA units are located in highest resource areas.

Environmental Opportunities
The TCAC/HCD Opportunity Maps include an Environmental Burden Flag layer based on the California Office of Environmental Health Hazard Assessment (OEHHA)’s CalEnviroScreen 4.0 tool (CES) indicators. Based on the 2025 TCAC/HCD maps, there are no tracts in Carmel-by-the-Sea that have the Environmental Burden Flag. The CalEnviroScreen 4.0 map for Carmel-by-the-Sea identifies the degree to which communities are considered burdened by pollution by comparing the scores of each census tract to every other census tract in the state. Both Carmel-by-the-Sea tracts scored in the highest quintile for environmental conditions, indicating more positive environmental factors.

Therefore, there are no RHNA units in areas with worse environmental conditions.

Disproportionate Housing Needs
Cost Burden
Between 40 and 60 percent of owners in both Carmel-by-the-Sea tracts are cost burdened. A slightly higher proportion of the owner population in the north tract are cost burdened (59.3 percent) compared to the south tract (45.5 percent). As discussed above, RHNA units are dispersed throughout the City and are not concentrated in a single neighborhood. Approximately 57 percent of RHNA units (pending projects, religious facility properties, live/work, mixed income incentive program sites, and additional opportunity sites) are in the southern tract where 45.5 percent of owners are cost burdened.

The sites inventory is shown in relation to cost burdened renters in Figure A-57, Table A-30, and Table A-31. A larger proportion of renters in the southern tract are cost burdened (64.8 percent) compared to the northern tract (43.6 percent). Potential hHotel conversion sites are scattered throughout the City.

Of the potential hotel conversion sites, 60.8 percent are in the northern tract where a smaller proportion of renter households experience cost burden. Conversely, a slightly larger proportion of non-hotel RHNA units (57 percent) are in the southern tract where a larger proportion of renter households are cost burdened. Of RHNA units identified through pending projects, religious facility properties, live/work units, mixed income incentive program sites, and additional opportunity sites, ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-97 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025

53.7 percent of lower income units, 50 percent of moderate income units, and 62.8 percent of above moderate income units are in the southern tract where the cost burdened renter population is more prevalent. It is also relevant to note that the northern tract, where only 43.6 percent of renters are cost burdened, has a larger overall renter population representing 53.8 percent of the tract population (438 renter households). The southern tract, where 64.8 percent of renters are cost burdened, has a renter population of only 244 households (31.6 percent of the tract population).

Overall, the City’s RHNA strategy distributes housing opportunities throughout the City and does not concentrate units of any income level in a single neighborhood alone. Further, the sites strategy does not concentrate lower income units in the southern tract where the cost burdened renter population is higher at a rate exceeding the above moderate income unit share. The sites strategy increases housing mobility by supporting housing development citywide, while also serving existing needs.

Table A-30 - Distribution of Potential Hotel-to-Residential Conversion Opportunity Sites by Cost Burdened Renters (2022)
Overpaying Renters
(Tract) Hotel Rooms Percent
<20% 0 0.0%
20-30% 0 0.0%
30-40% 0 0.0%
40-60% 607 60.8%
60-80% 392 39.2%
>80% 0 0.0%
Total 999 100.0%
Source: HCD AFFH Data Viewer 3.0, 2018-2022 ACS.

Table A-31 - Distribution of RHNA Units by Cost Burdened Renters (2022) Overpaying Renters
(Tract)
Lower Moderate Above Moderate Total
Units Percent Units Percent Units Percent Units Percent <20% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
20-30% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
30-40% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
40-60% 69 46.3% 1 50.0% 32 37.2% 102 43.0%
60-80% 80 53.7% 1 50.0% 54 62.8% 135 57.0%
>80% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
Total 149 100.0% 2 100.0% 86 100.0% 237 100.0%
Source: HCD AFFH Data Viewer 3.0, 2018-2022 ACS.

Note: Includes pending projects, religious facility properties, live/work units, mixed income incentive program sites, and additional opportunity sites.

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Appendix A – Housing Needs and Fair Housing Report A-98 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-57 - Sites Inventory and Cost Burdened Renters by Tract (2022) ATTACHMENT 4

Appendix A – Housing Needs and Fair Housing Report A-99 Carmel-by-the-Sea 6th Cycle Housing Element Amendment Update Adopted November 2025 Figure A-58 - Sites Inventory and Displacement Risk by Tract (2022) ATTACHMENT 4

Therefore, there are no RHNA units in areas where overcrowding is an issue.

Displacement
The Urban Displacement Project (UDP) designates census tracts as “sensitive communities” if the share of very low-income residents is greater than 20 percent and have any of the two following characteristics:
 The share of renters is above 40 percent
 The share of people of color is above 50 percent
 The share of very low-income households that are severely rent burdened is above the county median
 The percent change in rent is above the county median for rent increases According to the UDP, the north Carmel-by-the-Sea tract is considered an area with a lower displacement risk. The southern tract does not have displacement risk data due to the small population.

Therefore, there are no RHNA sites in areas with a heightened displacement risk.

Fair Housing and Sites Inventory Assessment Summary
The City’s sites inventory includes a variety of housing opportunities located throughout the City.

There are no RHNA units of any income levels concentrated in a single area of the City. Further, due to the relatively small footprint of the City (approximately one square mile), demographic populations are generally homogenous citywide. Due to the spread of the RHNA sites and the lack of concentrated vulnerable populations (i.e., non-White, persons with disabilities, cost burdened households), the sites inventory does not exacerbate existing fair housing conditions. Sites selected to meet the RHNA aim to serve a variety of populations (i.e., lower, moderate, and above moderate income households, live/work units, mixed income). Additionally, the location of the sites supports housing mobility by facilitating new housing opportunities suitable for all income levels throughout all areas of Carmel-by-the-Sea, while also serving existing vulnerable populations such as lower income households and cost burdened renters.

A.8 Fair Housing Recommendations
Contributing Factors and Fair Housing Action Plan
The disparities in housing choice and access to opportunity discussed above stem from historical actions, socioeconomic factors that limit employment and income growth, barriers to open housing choice, and until recently, very limited resources to respond to needs.

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g yy
solicited the input of the public with prompted questions. All responses were taken into consideration for incorporation into the Housing Element to guide policies and programs that address the housing needs of existing and future residents.

Question: How can the supply of affordable housing be increased to meet the needs of our community?
Community members offered the following solutions:
 Encourage ADUs;
 Encourage second-story additions to single-story buildings downtown specifically for affordable housing;
 Change the zoning code to allow 3-story buildings downtown specifically for affordable housing;
 Set a maximum square footage limit on housing units in downtown to spur the creation of more small units rather than just a few large units;
 Create objective (yes/no checklist-style) design standards for new housing projects that include affordable units;
 Less short-term rental places, more long-term rental options;  Build housing on the outskirts and empty parking lots;  Annex land outside City for affordable housing; and
 Continue to ensure the built environment is subordinate to the natural environment.

Question: In your experience in Carmel-by-the-Sea, what has contributed to the fair housing issues? What solutions do you envision to address these issues?  Information about affordable units.
 Down payment assistance.
 Tenant assistance resources.

Priority of Contributing Factors
The City of Carmel-by-the-Sea has prioritized the following contributing factors to the Fair Housing issues mentioned above. Table A-32 presents prioritized fair housing issues and contributing factors, as well as the City’s programs to support a solution-oriented approach to affirmatively furthering fair housing.

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A – Housing Needs and Fair Housing Report
y-the-Sea 6th Cycle Housing Element Amendment Update Adopted Novem A-32 - Fair Housing Issues, Contributing Factors, and AFFH Programmatic Actions Fair Housing Issue Contributing Factor(s) AFFH Programmatic Action P old Characteristics
by-the-Sea has significantly lower
ns of racial and ethnic minorities
d to Monterey County and the AMBAG
ack of inclusionary housing may
e to the lack of protected classes in the
ity.
 Lack of racial and ethnic diversity within the City; and  Lack of adequate affordable housing options.

Program 1.1.B: Underutilized SitesDevelopment on
Small Sites
Program 1.1.C: Live/Work Housing

1.1.D: Mixed-Income Incentive Program
Program 2.1.A: Incentives for Mixed-Use Development
Program 3.1.C: Density Bonus
Program 3.1.D: Reduced Entitlement and Development
Fees
Program 3.1.C: Density Bonus
Program 3.1.D: Reduced Entitlement and Development
Fees
Program 1.3.D: Employee Housing Program
Program 2.1.A: Incentives for Mixed-Use Development
ortionate Housing Needs
(46) percent of Carmel-by-the-Sea
lds are cost burdened households, of
percent are renter-occupied households
ercent are owner-occupied.
 Lack of affordable housing;
 Lack of adequate housing stock that meets the needs of residents; and
 Jobs-worker imbalance.

Program 1.1.B: Underutilized SitesDevelopment on
Small Sites
Program 1.1.E: Affordable Housing on Religious
Facility Properties
Program 1.1.F: Hotel-to-Residential Conversion (Home
‘Key’ Transfer)
Program 1.1.G: Hotel Employee Housing Program
Program 1.1.H: Accessory Dwelling Units
Program 3.1.B: Housing for Extremely-Low Income
Households
Program 1.3.DB: Employee Housing Program
Program 2.4.A: Housing Rehabilitation and
Maintenance Information
Program 3.1.C: Density Bonus
Program 2.4.A: Housing Rehabilitation and
Maintenance Information
Program 3.1.B: Housing for Extremely-Low Income
Households
Program 3.1.C: Density Bonus
Program 3.1.G: Affordable Housing Overlay District
Needs Groups
el-by-the-Sea, extremely low-income and
eeds groups
 Lack of affordable housing;
 Jobs-worker imbalance;
 Lack of accessible units for individuals with disabilities; and  Lack of Transitional and Supportive Housing/Emergency Shelters.

Program 1.3.E: Emergency Shelters
Program 3.1.B: Housing for Extremely-Low Income
Households
Program 3.2.A: Reasonable Accommodation
Procedures
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A – Housing Needs and Fair Housing Report
y-the-Sea 6th Cycle Housing Element Amendment Update Adopted Novem Fair Housing Issue Contributing Factor(s) AFFH Programmatic Action P ce disproportionate impacts of poverty,
g the challenge of obtaining adequate
n the City.

Program 3.2.C: Family Friendly Housing
Program 3.3.A: Zoning for Transitional and Supportive
Housing
Program 3.3.B: Low-Barrier Navigation Centers
Program 3.3.C: Unlicensed Residential Care Facilities
Program 3.3.D: Single Room Occupancy (SRO) Units
Program 5.1.D: Farmworker HousingProgram 1.3.E:

Amend the A-2 Zoning District Program 3.1.B:

Housing for Extremely-Low
Income Households
Program 3.2.A: Reasonable Accommodation
Procedures
Program 3.3.A: Zoning for Transitional and Supportive
Housing
Program 3.3.B: Low-Barrier Navigation Centers
g Stock
by-the-Sea’s lack of affordable housing
on, limited variety of housing types, and
g housing costs create barriers to enter
housing market.
 Since 2015, there have been 18 housing permits in the City for only above moderate-income households; and
 Lack of developable land, and the City is subject to coastal zone ordinances.

Program 1.1.B: Development on Small Sites
Program 1.1.E: Affordable Housing on Religious
Facility Properties
Program 1.1.F: Hotel-to-Residential Conversion (Home
‘Key’ Transfer)
Program 1.1.G: Hotel Employee Housing Program
Program 1.1.H: Accessory Dwelling Units
Program 1.4.A: Modify or Eliminate Onerous Use
Permits
Program 1.4.B: Objective Design Standards
Program 1.4.C: By-Right Approval
Program 2.1.B: Permanent Housing
Program 2.3.A: Preserve and Increase Upper Floor
Residential Uses
Program 3.1.E: Reduced Parking Requirements
Program 3.1.F: Expedited Processing Procedures
Program 3.1.G: Establish Minimum DensitiesProgram

1.3.A: Condominium Conversions Program 1.3.B:

Overnight Visitor
Accommodation (Conversion) Development Transfer
Rights
Program 1.3.C: Accessory Dwelling Units Program

1.4.A: Remove Use Permit
Requirement for Multi-Family
Development
ATTACHMENT 4

A – Housing Needs and Fair Housing Report
y-the-Sea 6th Cycle Housing Element Amendment Update Adopted Novem Fair Housing Issue Contributing Factor(s) AFFH Programmatic Action P Program 1.4.B: Objective Design Standards Program

2.1.B: Permanent Housing
Program 2.3.A: Preserve and Increase Upper Floor
Residential Uses
Program 3.1.E: Reduced Parking Requirements
Program 3.1.F: Expedited Processing Procedures
to Opportunity
duction of affordable housing in Carmel
ea limits housing choices for low-income
lds, and has a disproportionate impact on
or Latino, Asian, and Black/African
n households.
 Of the 18 housing permits issued in Carmel-by-the-Sea since 2015, zero were issued for lower-income households (lack of affordable housing); and
 Costs of land, materials, and labor which limit profitability of affordable housing.

Program 1.1.C: Live/Work Housing
Program 1.1.G: Hotel Employee Housing Program
Program 1.2.A: Water Distribution Policy Prioritization for Affordable Housing
Program 1.3.A: Condominium Conversions Program

1.3.BD: Employee Housing
Program 2.1.D: Establish Affordable Housing Trust
Fund
Program 3.1.A: Mixed-Use Affordable Housing
Program 3.1.C: Density Bonus
Program 3.2.B: Housing Mobility
Program 4.1.A: Water ConservationProgram Program

2.1.D: Establish Affordable Housing
Trust Fund
Program 3.1.C: Density Bonus Program 4.1.A: Water
Conservation
using Enforcement
ents filed fair housing complaints in
by-the-Sea, indicating a lack of cause for
t, or, alternatively, a potential lack of
ss about fair housing rights.
 Lack of access to information about fair housing rights; and  Limited knowledge of fair housing by residents.

Program 2.1.C:Monitor Affordable Housing Stock
Program 5.1.A: Fair Housing Services
Program 5.1.B: Housing Choice Voucher Program
Program 5.1.C: Shared Housing Information
Program 5.2.A: Support Community Organizations
M
ty of Carmel-by-the-Sea; EMC Planning Group
ATTACHMENT 4