Carmel-by-the-Sea City Council
July 7, 2026

Appendix B – Housing Constraints B-46
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Single-Family* Multi-Family (10 units) **
MPWMD $225 $2,250
CUSD $980 $9,800
Cal-Am $3,000 $5,000
CAWD $8,242 $82,426
TAMC $4,036 $17,386
Regional Fees Subtotal $16,483 $116,862
Total Fees $33,960 $135,729
Source: City of Carmel-by-the-Sea Fee Schedule Effective September 9, 2023; MPWMD Fee Schedule, July 2023; CUSD Developer Fees, 2023; Cal-Am Fee Schedule, 2022; CAWD Fee Schedule 2023; TAMC Fee Schedule, 2022.

Notes: *Assumed $350K valuation and 2,000 sq. ft.
**Assumed $5,000,000 valuation and 20,000 sq. ft.

City fees to develop a single-family home roughly equal the regional fees. For multi-family development, regional fees comprise the bulk of the costs. As shown in Table B-9, total development fees for a 10-unit multifamily development would total approximately $135,729, of which regional fees total $116,862 – approximately six times the City fees ($18,867). On a per unit basis, total development fees for a single multifamily unit would total approximately $13,573.

Comparatively, this is significantly less than that of a single-family unit.

While fee types in comparable and neighboring jurisdictions do not precisely align with the fee types in Carmel-by-the-Sea for side-by-side comparison, the total estimated fees as cited in Pacific Grove’s Draft 2023-2031 Housing Element Update (Table 1-42) offer comparative insight. While Carmel estimates a total fee of $33,960 for a single-family home and $135,729 for a 10-unit multi-family home, Pacific Grove estimates $68,928 and $212,350, respectively. This indicates Pacific Grove’s City fees are substantially higher than Carmel-by-the-Sea’s. The City of Monterey’s Draft 2023-2031 Housing Element (Table C-10) does not provide estimated total fees for single-family and a 10-unit multi-family development for an “apples to apples” comparison with Carmel-by-the-Sea and Pacific Grove, however, fees for a four-unit multi-family project in the City of Monterey are estimated at approximately $18,841, which is on par with the City of Carmel-by-the-Sea’s City fees, but no regional fees are included in Monterey’s estimate.

Overall, Carmel-by-the-Sea’s fees are less than neighboring jurisdictions. Regional impact fees pose the greatest constraint to the development of multifamily housing. Despite regional fees being beyond the City’s control, the City is committed to lowering the cost to develop affordable multifamily residential units. Program 3.1.D establishes and monitors the implementation of reduced entitlement and development fees for projects with affordable units (see Chapter 2).

Processing and Permit Procedures
The processing time needed to obtain development permits and required approvals varies depending on the scope of the project. The size of projects in Carmel-by-the-Sea is typically limited to the remodeling or construction of a single-family home, a minor commercial modification, or the construction of an accessory dwelling unit. The City strives to keep its permit procedures streamlined and processing times short. The Planning Division is the lead agency in processing residential development applications

Appendix B – Housing Constraints B-47
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 and coordinates the processing of those applications with other City departments such as the Building Safety Division and Public Works Department and other outside agencies as deemed appropriate, such as the fire and water districts.

Carmel-by-the-Sea has traditionally encouraged high architectural standards for new development. City zoning regulations require design review approval for any proposed additions to or the construction of new single-family homes, duplexes or multi-family developments. However, accessory dwelling units are exempt from design review by state law and must only meet the location and development standards outlined by state law (Government Code §65852.2).

Permit applications are generally processed in as an efficient manner as practical in Carmel-by-the-Sea.

Although the Historic Resources Board, the Planning Commission, and the City Council only meet once a month, determination on a project is usually reached in one or two meetings. For Track 2 Design Study applications, the City does require applicants to take part in a Forest and Beach Commission if tree removal is proposed, as well as a separate Concept hearing and Final Details hearing with the Planning Commission prior to formal approval. There is no separate Design Review Board in Carmel, with the Planning Commission conducting design review. The typical processing time for Track 2 discretionary review is four to six months, depending on the degree of completeness of submitted plans, whether tree removal or replacement is proposed, whether the property is deemed historic or eligible for historic listing, whether the property falls within the “Beach and Riparian Overlay” (Coastal Commission Appeal Jurisdiction), and whether the project requires a volume study or any other technical study be conducted. While this review procedure assists in achieving project acceptability and allows for neighborhood participation through multiple public hearings, the overall scale and level of complexity of review does provide a barrier to applicants without the financial resources and time to see a residential project through to completion.

However, the City does have a practice of moving projects with affordable housing ahead of other projects in the development processing queue when setting development review agendas. Due to Permit Streamlining law, this incentive is less powerful than it once was. However, it may reduce review time by as much as a month. Even this minor benefit attracts developer attention during preapplication meetings. Projects that include affordable housing are also expedited through the plan check process.

Carmel-by-the-Sea’s development process can be summarized in the following nine steps. All of these steps may not be necessary, depending on the nature of a project:

1. Application Submittal - The planning application submittal process begins when a developer, architect, property owner, or other applicant authorized by the property owner (Project Applicant) submits a development application, required fees, and application materials. Often times the developer will have met informally with the Planning Division to review the project and receive preliminary feedback on the proposal in advance of the formal project submittal.

Appendix B – Housing Constraints B-48
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026

2. Plan Review - After the application is received, it is routed to the relevant City Departments, including the Planning Division, Building Safety Division, Fire Prevention, and Public Works. A planner is assigned to serve as the liaison to the Project Applicant, helping to expedite the permit process and coordinating the department reviews. During a 30-day review period for completeness, individual departments assess the completeness of the application, work with the Project Applicant to correct any project deficiencies, and prepare preliminary Conditions of Approval.

3. Application Assessment - The application is assessed for its compliance with the standards of the Zoning Code (Title 17 of the municipal code) as well as the City’s Residential or Commercial Design Guidelines.

4. Environmental Review - A review of the environmental issues associated with the proposed project (as required by the California Environmental Quality Act) will also be completed during the Plan Review stage of the process.

5. Forest and Beach Commission/Historic Resources Board – If a project proposes to remove a significant tree(s), it will require review by the Forest and Beach Commission. If the property is a listed historic resource or has potential eligibility for listing as a historic resource, the project is required to be reviewed by the Historic Resources Board.

6. Planning Commission/City Council Approval - If a project is determined to require discretionary action, it will be scheduled for review by the Planning Commission. A Public Notice will be provided and all property owners within 300 feet of the project site will be notified by mail. After projects receive approval by the Planning Commission there is a ten‐ working-day appeal period during which the project may be appealed to the City Council.

The City Council decision is final, unless the project is located within the Coastal Commission appeal jurisdiction. There are different levels of planning review/approval depending on the scope of work proposed.

7. Plan Check - After the project receives all required approvals, construction plans may be submitted to the Building Safety Division for a plan check for building permits. The plans will be routed to the City’s Planning Division and Public Works Department. The project planner will review the plans for conformance with the Zoning Code, any required Conditions of Approval, and with plans approved by the Planning Commission or City Council. The Building Safety Division will verify that all building, fire, mechanical, plumbing and electrical code requirements are fulfilled in compliance with the California Code and other State requirements.

8. Building Permit - After the construction plans receive approval from the relevant departments, the Building Safety Division issues a building permit. Construction can begin after this point. Regular inspections are required throughout the construction process. The final inspection requires clearance from all relevant City departments and the Carmel Fire Department.

Appendix B – Housing Constraints B-49
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026

9. Occupancy Permit - Once the final inspection is complete, the developer needs to secure a certificate of occupancy. New buildings or structures cannot be used or occupied until the Building Official has issued a certificate of occupancy.

Typical Processing Times
Processing times for development review vary based on the size of the project and the extent of environmental review required, and a can range from six months to over a year if an EIR is required.

When an application is submitted, it is reviewed within 30 days to verify that it is complete or the applicant is notified that it is incomplete. Once the application is complete, typical processing times are as follows, in line with the requirements of the State Permit Streamlining Act of 1992. Table B-11 shows the typical processing time for a residential development application.

Table B-11 Review/Approval Requirements and Processing Times Development Type Design Study Use Permit CDP1
Typical
Processing Time2
R-1 Single-Family Residential District
Single family residence Yes No Yes 6-9 months
ADU (Subordinate Unit) Yes No Yes 1month if exempt
from Planning
Review under
State Law
Guest house Yes Yes Yes 4-6 months
Building sites exceeding 30 percent slope Yes Yes Yes 6-9 months R-4 Multi-Family Residential District
Single family residences Yes No Yes 6-9 months
Multi-family residences 0-22 units/acre Yes No Yes 8-10 months Multi-family residences 23-44 units/acre Yes Yes Yes 8-10 months Commercial Districts
Multi-family residences 0-22 units/acre Yes No Yes 8-10 months Multi-family residences 23-44 units/acre Yes Yes Yes 8-10 months Public and Quasi-Public Districts (A-2 and A-3)
Senior Citizen Housing Yes Yes Yes 8-10 months
Source: City of Carmel-by-the-Sea Community Planning and Building Department 2023 Notes:

1. CDP – Coastal Development Permit – required for all projects that increase the height and/or floor area on an existing structure by 10 percent or more.

2. Includes time for building plan check
Single-family homes, duplexes and multi-family projects go through the same zoning compliance and design review process. The review and approval of multi-family projects typically takes longer due to the complexity of a more intense development and the myriad issues that need to be considered including adequate site servicing, design review, potential tentative map review, and the more active involvement of other departments and agencies outside of Planning. Program 3.1.F has been included in this Housing Element to establish expedited permitting procedures to remove barriers to the development of multi-family housing (see Chapter 2). The program includes implementation of

Appendix B – Housing Constraints B-50
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 concurrent permit processing to avoid multiple hearings and review bodies. This will streamline the permitting process allowing for timely review and entitlement of multi-family projects.

Although there is a high level of public input on some planning applications, Carmel-by-the-Sea’s zoning standards and design review ordinance are fairly detailed. There is a level of certainty on behalf of the project applicants that if the project meets the standards and goals of the ordinances, the project will receive City support. Table B-12 shows the reviewing authority and typical processing times, in line with the requirements of the State Permit Streamlining Act of 1992.

Table B-12 Permit Streamlining Act Processing Times
Application Final Authority Typical Processing Time
Subdivision Parcel Map (Tentative) City Council 45-60 days Subdivision Parcel Map (Final) City Council 45 days
Subdivision Tract Map (Tentative) City Council 3-6 months Subdivision Tract Map (Final) City Council 2-4 months
Negative Declaration Planning Commission 3-6 months
Environmental Impact Report Planning Commission 1 year* Source: City of Carmel-by-the-Sea
Note: If the applicant modifies the application, or if the applicant submits a written request for a time extension, the maximum time period for review may be extended for up to 90 additional days.
*Upon mutual consent of the Director and the project sponsor, this one-year time limit may be extended once for a period of not more than 90 days pursuant to CEQA Guidelines Section 15108.

Environmental Review
Environmental review is required for all development projects under CEQA. Carmel-by-the-Sea has a number of environmental constraints due to its coastal location and conservative approach to preserving its unique natural surroundings. Because of these environmental constraints, larger residential projects have required preparation of EIRs. An EIR is required of all developments that have the potential of creating significant impacts that cannot be mitigated. Most residential projects in Carmel-by-the-Sea are either Categorically Exempt or require only an Initial Study and Negative Declaration. The Negative Declaration process typically takes four to eight months to complete, depending on staffing levels and workloads. Categorically Exempt developments such as accessory dwelling units require a minimal amount of time. As a result, State-mandated environmental review does not pose a significant constraint to housing development.

SB 35 Streamlining
Government Code §65913.4 allows qualifying development projects with a specified proportion of affordable housing units to move more quickly through the local government review process and restricts the ability of local governments to reject these proposals. The bill creates a streamlined approval process for qualifying infill developments in localities that have failed to meet their RHNA, requiring a ministerial approval process, removing the requirement for CEQA analysis, and removing the requirement for discretionary entitlements. Since the adoption of this section of the Government Code, the City has not received an application under these provisions.

Appendix B – Housing Constraints B-51
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 As previously noted, the entire City is located within the California Coastal Zone and therefore was not subject to early implementation of SB 35 (see Government Code §65913.4(6)), which did not apply to areas located in a coastal zone. However, as of October 2023, SB 423 was signed into order expanding SB 35 measures to apply to coastal zones under specific criteria. The City has included Program 1.3.D in the 6th Cycle Housing Element to address SB 35 and SB 423 measures (see Chapter 2). The City will create a checklist and written procedures for processing SB 35 applications to ensure efficient and complete application processing.

SB 10 Building Opportunities for All
SB 10 makes it easier for cities to zone for smaller, lower-cost housing developments of up to 10 units to address California’s housing crisis. SB 10 provides tools for local governments to zone for up to ten homes per parcel in transit-rich areas, or urban infill sites. SB 10 maintains local control, as a local legislative body must pass a resolution to adopt the plan. The City has included a program in the 6th Cycle Housing Element to address SB-10 and encourage urban infill on large properties zoned singlefamily (R-1).

SB 9 California Housing Opportunity and More Efficiency (HOME) Act SB 9, also known as the California Housing Opportunity and More Efficiency (HOME) Act, is a state bill that requires cities to allow one additional residential unit on parcels zoned for single-dwelling units.

The City has not received any inquiries of interest for SB 9 lot splits and is not currently processing any SB 9 applications.

Building and Fire Code
Building and safety codes are adopted to preserve public health and safety, and ensure the construction of safe and decent housing. These codes and standards also have the potential to increase the cost of housing construction or maintenance. The City’s Building Code is currently based on the latest, 2022 version of the California Building Code, along with all required updates (City Ordinance No. 2022-004).

The City has not made any amendments to the Code that might diminish the ability to accommodate persons with disabilities or other special-needs groups.

The 2022 California Fire Code as adopted by the City and effective January 1, 2023 (found in Chapter

15.55 of the CMC), prescribes the issuance of Fire Code Operational Permits for operations, processes, and/or activities that present higher levels of risk to life and property. Operational permits allow the City to better track specific hazards and to assure that safeguards for hazardous operations, processes, and activities are maintained in accordance with local, state, and federal regulations.

Carmel Municipal Code Title 8.32.100, Section 102.1(5) requires new structures, or existing structures to which additions, alterations or repairs are made that involve the addition, removal or replacement of 50 percent or greater of the linear length of the walls of the existing building (exterior plus interior) within a 5-year period, are required to be outfitted with an automatic fire sprinkler system. Fire sprinklers shall be addressed as part of the building permit review. It is recognized that the costs of an automatic fire sprinkler system can vary considerably based on various factors including water service

Appendix B – Housing Constraints B-52
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 capabilities, whether a new meter is required, and the type of fire suppression system required for the application in question. However, it is generally recognized by City staff that installing fire sprinklers can be expensive and can present challenges from a water flow standpoint. Parts of Carmel have low water pressure affecting the ability to install sprinklers, which in-turn significantly increases construction costs if additional on-site infrastructure is needed (e.g., water holding tanks, pumps) to serve the sprinkler system.

Additionally, vehicular access within the community is affected by steep, hilly terrain and many secondary ridge lines. Many streets are narrow and winding, restricting the speed at which a fire apparatus may safely respond and also increasing the time lapse between fire detection and apparatus arrival, during which a household will face the fire or other emergency on their own.

The State Fire Marshal’s Office, and the City of Carmel-by-the-Sea, have adopted regulations for protection of structures built in areas susceptible to wildland fires under California Building Code Chapter 7A (2019 edition). Exterior wildfire exposure protection within the City of Carmel-by-the- Sea is prescribed in Municipal Code Title 15, Buildings and Construction. Protective features include such active measures as combustible vegetation management and sprinkler systems; and passive protection features such as fire resistive roofing and building opening protection. The extent of protection is determined by the location of the property. The currently adopted (October 2008) California Department of Forestry and Fire Protection (CAL FIRE) Very High Fire Hazard Severity Zones in Local Responsibility Areas (LRA) map for Carmel-by-the-Sea, identifies a large area encompassing northern and eastern portions of the City as a “Very High Fire Hazard Severity Zone.” It should be noted that all LRA maps across the state of California are undergoing updates and according to CAL FIRE are anticipated to be released sometime in 2024. Within the areas identified in the “Very High Fire Hazard Severity Zone,” additional construction features are mandated. These typically include ignition resistant materials, spark protection for ventilation openings, and exterior window and door protection. Detailed requirements are contained in Chapter 7A of the California Building Code and in Carmel Municipal Code Titles 8 and 15.

Building Code and Zoning Code enforcement activities are undertaken on a proactive and complaint basis. The City finds that the adopted Building Code and Zoning Code and associated enforcement activities are not constraints to the development, maintenance or preservation of housing.

On-Site and Off-Site Improvement Standards
Because the City is largely built-out, all infrastructure, including curbs, gutters, sidewalks, streets and utilities are in place. Development of residential units involves hooking up to the existing utilities, which already exist in the right-of-way. All electrical distribution lines, telephone, cable television, and similar service wires or cables, which provide services to new development, are to be installed underground. Typical infrastructure costs in the CC, SC, RC, and R-4 districts are limited to sidewalk, curb, and gutter improvements, undergrounding of utility wires, stormwater drainage improvements, and landscaping. The City’s Municipal Code does not contain requirements for subdivision off-site

Appendix B – Housing Constraints B-53
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 improvements. However, the Code includes a chapter on requirements related to streets, sidewalks, and public places.

Sidewalks
Construction of sidewalks is not required in residential areas of the City. If sidewalk construction is proposed, a permit is required. The proposal must show that the construction of the sidewalk or walkway will preserve public safety, health or welfare, resolve a serious drainage problem, or that it would otherwise benefit the general public. The construction of the sidewalk or walkway must follow the natural contours of the land, and 50 percent or more of the sidewalk area in front of any building site must be retained in planting. It shall continue to be the policy of the City to avoid formal sidewalks in favor of meandering and unpaved footpaths where possible.

Driveways
Construction of a driveway requires a permit from the Department of Community Planning and Building in conjunction with the Director of Public Works and the Director of Forest, Parks and Beach.

Landscaping
Sidewalk street trees are encouraged by the City, with the City Forester determining the number of trees, species, and exact location. Sidewalk street trees should be located near the head of, and adjacent to, parallel parking spaces with the trunk of the tree located 4.5 feet back from the head of the parking space. For trees at the curb line there should be at least four feet between the trunk and the facing building or planters in front of the building. All tree planters are encouraged to be as large as possible so that additional landscaping can be incorporated into the planters.

The City also encourages including “mini-parks,” which is a park that protrudes into the street from the curb line or is in the street. The design of mini-parks must be consistent with the standards in the Forest and Beach Management Plan.

Streets
The improved portion of residential streets in Carmel are narrow in width, 26 to 34 feet, with no gutters or sidewalks. This lack of formal development of streets throughout Carmel’s residential neighborhoods has been a conscious effort on the part of residents to maintain a “village in a forest” atmosphere. As Carmel is a built-out city and new development will occur as infill or redevelopment on parcels within the established street grid, construction of new streets is not anticipated.

Therefore, street standards will have no impact on the cost and supply of housing.

Summary of Governmental Constraints
The governmental constraints to the development of affordable housing in Carmel-by-the-Sea are summarized below and outlined in Table B-13, along with implementation programs intended to address the constraints.

Appendix B – Housing Constraints B-54
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Lack of Water Resources
The primary infrastructure constraint to the development of housing in Carmel is the lack of potable water. The lack of a reliable available water supply continues to limit growth in Carmel and throughout the Monterey Peninsula region.

Location in the Coastal Zone
Carmel-by-the-Sea is located in the California Coastal Zone and is therefore subject to a host of regulations that are not present in communities outside the Coastal Zone. The presence of additional land use regulation via the Local Coastal Program, in general, means that housing development in Carmel-by-the-Sea faces a high bar to succeed. The additional hurdles presented by Coastal Zone regulations represent an additional layer of complexity to the City’s already time-consuming review process. For example, the Coastal Act requires visual analysis during the review phase of development to determine if significant coastal views are at risk of being obstructed by proposed development. The City has no control over this development requirement; however, they are able to modify what type of visual analysis is used. Program 3.1.F includes an amendment to the Municipal Code to allow 3-D modeling or other visual analysis in lieu of story poles for multi-family developments.

City Design Review and Permit Processing
Architectural design is important in Carmel-by-the-Sea. The historic character of Carmel’s built environment has been shaped by decades of careful and deliberative design review (referred to as “design study” in Carmel) that addresses such features as site design, architectural style, building materials, color palettes, fenestration, tree placement and landscaping. This attention to detail has resulted in a beautiful, forested village atmosphere that continues to capture the imagination of people from around the world who visit and even choose to make Carmel their home. The same design review process that has contributed to Carmel becoming a world-famous destination, however, has also impacted its ability to provide housing for lower-income households.

The City’s design review (design study) process may be lengthy for projects involving significant trees, historic resources, and/or underdeveloped plans. The following are governmental bodies responsible for decision-making through the course of development review:
 Forest and Beach Commission if removal of a significant tree is proposed (one hearing);  Historic Resources Board for historic properties and also for non-historic properties in the Conservation District (one hearing to ensure development is compatible with neighborhood context);
 Planning Commission: One hearing, minimum, for commercial and multi-family residential projects. Preliminary hearing/review for commercial/multi-family is optional but encouraged.

Two hearings, minimum (one Concept hearing, one Final hearing) for single-family projects;  City Council review on appeal; and
 Coastal Commission review on appeal (Coastal Zone Appeal jurisdiction only).

Appendix B – Housing Constraints B-55
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 In addition, the City’s permit process, which includes a use permit above 22 du /acre and includes both objective and subjective standards, could also pose as a constraint to developers, especially of multifamily affordable housing projects. Program 3.1.G has been included in the 6th Cycle Housing Element to establish a minimum density of 22 dwelling units per acre and a maximum density of 40 dwelling units per acre for the base zoning in the CC, SC, RC, and R-4 districts (see Chapter 2). Establishing a minimum density will enable the development of residential units at a higher yield, lending to increased feasibility to develop affordable units.

City Fees and Regional Development Fees
The City’s design review process may be financially prohibitive for lower-income households and likely most affordable housing projects. Regional development fees are exorbitant and make up the bulk of costs for multi-family developments.

Parking Requirements
Parking is limited within Carmel-by-the-Sea. Off-street parking requirements can be prohibitive to building multi-family and affordable housing.

Commercial Overnight Visitor Accommodation
The Municipal Code Section 17.56.060 limits the total number of overnight visitor accommodations (hotel/motel/inn) units which increases the value of the use and acts as a disincentive to redevelop existing older non-conforming overnight visitor accommodations to refurbished permanent multifamily residences. The limit also acts as a disincentive to add on-site employee housing because scarce square footage is more valuable as an overnight visitor accommodation use rather than a residential use that serves lower-income employees.

The City will explore the development of a program to allow the transfer of development rights of overnight visitor accommodation located in key areas of the City and, the City will develop an Employee Housing Program (Programs 1.1.F and 1.1.G).

Accessory Dwelling Units
The City of Carmel-by-the-Sea last updated it ADU ordinance in 2017, and therefore the City’s regulations addressing ADUs are out of date. The City has included a new program in this 6th Cycle Housing Element to revise its Municipal Code to be consistent with ADU and JADU state law, and develop standardized ADU plans. The City is currently updating their ADU Ordinance to comply with recent changes to state law.

The City is following State ADU law while the ADU Ordinance is being developed. The State ADU Handbook is posted on the City website and distributed to ADU applicants. ADUs/JADUs that are 800 square feet or less, 16' tall or less, with at least 4' rear and side setbacks bypass review by the Planning Division and are routed straight to the Building Division. ADUs/JADUs that do not meet these standards are subject to a ministerial Planning review to confirm the project meets City floor area

Appendix B – Housing Constraints B-56
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 standards (1,800 square feet of floor area permitted on a standard 4,000 square-foot-lot) and minimum setbacks (3' side setback, 3' rear setback if less than 15' high, 15' front setback).

ADUs/JADUs are not subject to the City's Residential Design Guidelines, which contain both objective and subjective guidelines, nor are they subject to any public hearings. Because parking is not required for ADUs located within one half-mile walking distance of public transit, ADUs in Carmel-bythe-Sea do not require parking.

Manufactured Homes and Mobile Homes
A new program to amend the Municipal Code to clarify that manufactured homes and mobile homes are allowed as a permitted use in the R-1 zoning district is included in the Housing Element.

Use Permits
There are opportunities to reduce redundancies and facilitate residential construction while still enabling development to meet City regulations. Taking an overall critical look at the application of use permits, including application to increased densities for affordable multi-family residential projects, and removing this permit requirement where it does not add any necessary regulations will remove a regulatory constraint that adds to residential developer uncertainty, extends the permit entitlement process, and overall residential development costs. The 6th Cycle Housing Element includes Program

1.4.A to eliminate unnecessary use permits.

Transitional and Supportive Housing
The 6th Cycle Housing Element includes Program 3.3.A to update the Municipal Code to further clarify that transitional and supportive housing in the R-1 and R-4 zoning district are permitted uses.

Low Barrier Navigation Centers
The 6th Cycle Housing Element includes Program 3.3.B to develop by-right procedures for processing low-barrier navigation centers.

The primary governmental constraints and the 6th Cycle Housing Element programs to address them, are shown in Table B-13.

Table B-13 Summary of Governmental Constraints
Governmental Constraint Programmatic Action
Lack of Water Resources
The primary infrastructure constraint to the development of housing in Carmel is the lack of potable water.

Program 1.2.A: Water Distribution
Program 4.1.A: Water Conservation
Location in the Coastal Zone
Carmel-by-the-Sea is located in the California Coastal Zone and is therefore subject to a host of regulations that are not present in communities outside the Coastal Zone.

Program 3.1.G: Establish Minimum Densities

Appendix B – Housing Constraints B-57
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Governmental Constraint Programmatic Action
City Design Review and Permit Processing
The historic character of Carmel’s built environment has been shaped by decades of careful and deliberative design review (referred to as “design study” in Carmel) that addresses such features as site design, architectural style, building materials, color palettes, fenestration, tree placement and landscaping.

The City’s design review (design study) process can be lengthy, impacting the City’s ability to provide housing for lower-income households.

Program 3.1.F: Expedited Processing Procedures
Program 1.4.B: Objective Design Standards
Program 2.2.A: Historic Preservation Educational Program Program 3.1.G: Establish Minimum Densities
Program 1.4.A: Eliminate Unnecessary Use Permits
Program 1.1.H: Accessory Dwelling Units
Program 1.3.B: Manufactured Homes on a Foundation System Program 3.1.B: Housing for Extremely-Low Income
Households
Program 3.3.B: Low-Barrier Navigation Centers
City Fees
The City’s design review and permitting process may be
financially prohibitive for lower income households and likely most affordable housing projects.

Program 3.1.D: Reduced Entitlement and Development Fees Program 3.1.E: Reduced Parking Requirements
Parking Requirements
Parking is limited within Carmel-by-the-Sea. Off-street parking requirements can be prohibitive to building multi-family and affordable housing.

Program 3.1.E: Reduced Parking Requirements
Commercial Overnight Visitor Accommodation Program 1.1.F: Overnight Visitor Accommodation (Conversion) Development Transfer Rights
Program 1.1.G: Overnight Visitor Accommodation – Employee Housing Program
The City’s development regulations are consistent with California housing law, and the Zoning Code enables development of affordable housing. However, because housing production has been limited in Carmel-by-the-Sea, primarily due to lack of potable water, the Housing Element Update includes programs to further incentivize development activity. Depending on site-specific conditions - such as the presence of significant trees or historic resources and degree of incompleteness of submitted plans, some applicants may find the City’s design review process to be lengthy. The City’s review fees, while comparable with those of surrounding jurisdictions, can pose a barrier for applicants without sufficient financial resources.

B.3 Non-Governmental Constraints
State law (Government Code §65583(a)(6)) requires an analysis of potential and actual governmental and non-governmental constraints to the maintenance, improvement, and development of housing for all income levels. The Housing Element must identify ways, if any, to reduce or overcome these constraints in order to meet the City’s housing needs.

Land Availability and Cost
Three primary factors contribute to high land costs on the Monterey Peninsula, and in Carmel-by- theSea in particular: 1) the area is considered a desirable place to live, 2) available land is in short supply and 3) land costs vary both between and within jurisdictions based on factors such as the desirability of the location and the permitted density. According to the real estate website, Zillow, the typical land value for a single-family home is between $800,000 and $1.2 million in the city of Monterey, but between $1.5 million and $5 million in Carmel-by-the-Sea.

Appendix B – Housing Constraints B-58
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Because land availability is limited within Carmel-by-the Sea and the City is largely built out, a number of programs have been created to creatively increase density and affordable housing potential within the City.

Construction Costs
Construction costs associated with housing development generally comprise soft and hard costs. Soft costs for housing development include the cost of architectural, engineering, accounting, legal and other professional services, as well as the cost of obtaining permits and paying government-imposed fees.

Carrying costs and the cost of construction financing can also be considered soft costs. Hard costs include the costs of labor and materials and can also include costs accumulated through permitting delays.

Hard costs are very high in Carmel-by-the-Sea, and both the high cost of labor and the high cost of materials could be considered constraints on housing development. Hard construction costs can vary significantly based on the varied and unique geographic conditions throughout the City. Hard costs can be higher than average in Carmel-by-the-Sea compared to Monterey County.

Hard and soft costs contribute significantly to the overall cost of developing new housing. High hard costs are difficult for an individual jurisdiction to mitigate.

Availability of Financing
As a stable and affluent community, private housing mortgage financing is readily available in Carmelby-the-Sea. There are no mortgage-deficient areas in the City and no identifiable underserved groups in need of financing assistance. At the time this Housing Element was drafted, interest rates for homebuyers were increasing from a low of 2.75 percent in 2020 to almost 7 percent in 2023 for a fixed rate, 30-year mortgage. The current economic climate is uncertain and still affected by increasing inflation, the possibility of a recession, geopolitical tensions, businesses rebounding and responding to changes brought on by the COVID-19 pandemic, and ongoing supply chain disruptions; however, there are a number of ways to finance residential development in the City, some of which are outlined below.

Banks, Community Development Financial Institutions Fund (CDFIs), and State Housing Agencies
Banks, Community Development Financial Institutions Fund (CDFIs), and state housing agencies all play a role in providing affordable housing.
 Banks are regulated by the Community Reinvestment Act (CRA), which requires them to provide lending and services to all segments of their communities, including low-and moderate-income borrowers. Banks can meet their CRA requirements through a variety of activities, including making loans to affordable housing developers, providing grants to community development organizations, and investing in CDFIs.

Appendix B – Housing Constraints B-59
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026  CDFIs are specialized financial institutions that provide loans, investments, and other financial services to low-income communities and individuals. CDFIs are often more flexible than traditional banks, and they can provide loans to borrowers who may not be able to qualify for financing from other sources.
 State housing agencies (SHAs) are government agencies that provide financial assistance for affordable housing development. SHAs can provide loans, grants, and tax credits to developers, and they can also help to promote affordable housing through public education and outreach programs.

Together, banks, CDFIs, and SHAs play a vital role in providing affordable housing. These organizations work to ensure that everyone has access to safe, decent, and affordable housing, regardless of their income. The California Housing Finance Agency (CalHFA) is a SHA that provides financing for affordable housing development in California. These organizations are essential partners in the fight to ensure that everyone has access to safe, decent, and affordable housing.

Housing Credits
Federal
The 4 percent and 9 percent LIHTC (Low-Income Housing Tax Credit) are federal tax credits that can be used to finance the construction or rehabilitation of affordable housing. The 4 percent credit is for the acquisition of existing buildings for rehabilitation and new construction financed by tax- exempt bonds. The 9 percent credit is generally for new construction and substantial rehabilitation with no federal subsidies. The amount of the credit is equal to 4 percent or 9 percent of the project's qualified basis, and it can be used to offset federal income taxes. The credit is claimed over a 10-year period.

The 9 percent LIHTC is more valuable than the 4 percent LIHTC, so it is typically used for larger projects. The 9 percent LIHTC is also more competitive, as there is a limited amount of 9 percent credits available each year. Both the 4 percent and 9 percent LIHTCs are important tools for financing affordable housing. They have helped to create millions of affordable housing units across the country.

State
State housing credit is a state-level program that provides tax credits to developers who build or rehabilitate affordable housing. The credits are similar to the federal Low Income Housing Tax Credit (LIHTC), but they are administered by state housing finance agencies (HFAs).

State HFAs allocate tax credits to developers through a competitive process. The credits are then sold to investors, who use them to offset their state income tax liability. The proceeds from the sale of the credits are used to finance the construction or rehabilitation of affordable housing.

State housing credit benefits both developers and low-income households. For developers, the credits provide a valuable source of financing that can help them make affordable housing projects financially feasible. For low-income households, the credits help to keep rents affordable.

Appendix B – Housing Constraints B-60
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Federal Home Loan Bank System
The Federal Home Loan Banks (FHLBs) are 11 regional banks that provide funding to financial institutions in all 50 states and U.S. territories. They were created by Congress in 1932 to help revitalize the housing market during the Great Depression.

FHLBs are cooperatively owned by their member institutions, which include community banks, credit unions, commercial banks, savings institutions, and insurance companies. These member institutions can borrow money from FHLBs at a discounted rate, which helps them to offer lower interest rates on mortgages and other loans to their customers.

In addition to providing funding, FHLBs also offer a variety of other services to their members, such as:
 Technical assistance on housing and community development  Affordable housing programs
 Letters of credit
 Mortgage purchase programs
FHLBs play an important role in the U.S. housing market. They help to ensure that there is a steady supply of affordable mortgage credit available to borrowers, and they also support community development efforts.

Federal Home Loan Bank and Affordable Housing Program
The Federal Home Loan Bank (FHLB) Affordable Housing Program (AHP) is a grant program that provides funding for the creation and preservation of affordable housing. The AHP is funded by a 10 percent contribution from each FHLB's earnings.

The AHP can be used to finance the following types of affordable housing projects.  Owner-occupied housing: The AHP can be used to finance the purchase, construction, or rehabilitation of owner-occupied housing for low-or moderate-income households.  Rental housing: The AHP can be used to finance the purchase, construction, or rehabilitation of rental housing where at least 20 percent of the units are affordable for and occupied by very low-income households.
 Mixed-income housing: The AHP can be used to finance the purchase, construction, or rehabilitation of mixed-income housing where a portion of the units are affordable for lowor moderate-income households.

The AHP is a competitive program, and applications are typically reviewed on a quarterly basis. To be eligible for an AHP grant, a project must meet the following criteria:
 The project must be located in a low-or moderate-income census tract.  The project must be affordable to low-or moderate-income households.  The project must be developed by a qualified project sponsor.

Appendix B – Housing Constraints B-61
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 The AHP is a valuable resource for developers of affordable housing. The program provides muchneeded funding for the creation and preservation of affordable housing, and it helps to ensure that lowand moderate-income households have access to safe and affordable housing.

Housing First
Supportive housing is a type of housing that provides permanent, affordable housing with on-site supportive services to help people who are homeless or at risk of homelessness. The supportive services can vary depending on the needs of the individual or family, but they may include case management, mental health services, substance abuse treatment, job training, and education.

There are a variety of supportive housing subsidy programs available in the United States. Some of the most common programs include:
 Housing Choice Vouchers (HCVs): HCVs are a federal program that provides rental assistance to low-income households. HCVs can be used to rent apartments on the private market, and they can also be used to pay for supportive housing.  Veterans Affairs Supportive Housing (VASH): VASH is a federal program that provides rental assistance and case management services to homeless veterans.  Rapid Re-housing: Rapid Re-housing is a short-term program that provides rental assistance and case management services to help people who are homeless quickly find and maintain housing.

The Housing First approach to homelessness is a philosophy that emphasizes providing permanent housing to people who are homeless, regardless of their other needs. The Housing First approach has been shown to be effective in reducing homelessness and improving the lives of people who are homeless.

The supportive housing subsidy system in the United States is a complex system, but it is an important part of the Housing First approach to homelessness. The subsidy programs help to make supportive housing affordable for people who are homeless, and they help to ensure that people who are homeless have access to the supportive services they need to succeed.

Requests to Develop at Densities Below Those Permitted
New State Housing Element law now requires the non-governmental constraints analysis to evaluate developer requests to build at densities below the density identified in the Housing Element sites inventory. Carmel-by-the-Sea assumed the base density of 22 dwelling units per acre identified in the Carmel Municipal Code for the CC, SC, and RC Districts for the 5th Cycle sites inventory. Due to small lot sizes throughout the commercial districts, this density results in estimates of 1-8 units per site, with the majority of sites accommodating 1-2 units. A total development potential of 78 units was identified for the commercial districts. While a lack of water resources generally precludes higher-density projects, a review of development trends during the 5th Cycle showed densities ranging from 7 dwelling units per acre to 44 dwelling units per acre for projects in the CC, SC, and RC Districts. Carmel-by-the-Sea did

Appendix B – Housing Constraints B-62
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 not receive requests during the 5th Cycle to develop below densities identified in the site's inventory; therefore, this is not a constraint to development. Additionally, the City identified a significant surplus of sites in the 5th Cycle Housing Element for a total capacity of 164 housing units (the 2015-2023 RHNA was 31 units), ensuring that any property that developed at a lower density than projected would not adversely impact the City's ability to maintain sufficient sites throughout the planning period to achieve the RHNA.

Small Lots and Large Units
Property within Carmel-by-the-Sea is typically smaller than a half-acre, which can be a constraint for housing production. Lot consolidation incentives may be a solution. Large multi-family units have become commonplace with recent housing proposals. Large units reduce the number of multi-family units overall, which decreases the housing variety available, and increases the number of expensive luxury housing options. The City has proposed a minimum density requirement for sites in the Central Commercial (CC), Service Commercial (SC), Residential and Limited Commercial (RC), and R-4 District (see Program 3.1.G in Chapter 2).

Seasonal Vacancies
Carmel-by-the-Sea has a 50 percent vacancy rate of which 80 percent is attributed to seasonal vacancies, given the community’s strong tourism industry. Second homeowners seeking seasonal homes skews the demand for housing, driving up rents and home prices and making it challenging for those working in Carmel-by-the-Sea to find available housing. Rising housing prices decrease the stock of housing affordable to those living or working in and around Carmel-by-the-Sea, further spurring the statewide housing shortage. Programs to address this issue are incorporated in the 6th Cycle Housing Element and include encouraging Accessory Dwelling Units and establishing of an Affordable Housing Trust Fund which could be funded in part by a vacancy tax.

Length of Time between Application Approval and Building Permit Issuance New Housing Element law now also requires an examination of the length of time between receiving approval for a housing development and submittal of an application for building permits. On average (based on City data from seven developments of vacant sites) there are 84 days between approval of a housing development and submittal of a building permit application, and 165 days between submittal of a building permit application and issuance of a building permit. The time between application approval and building permit issuance (249 days on average) is influenced by a number of factors, none of which are directly impacted by the City. Factors that may impact the timing of building permit issuance include required technical or engineering studies; completion of construction drawings and detailed site and landscape design; securing construction and permanent financing; and retention of a building contractor and subcontractors. Generally, building permits are submitted in a timely manner after planning entitlements; however larger projects have experienced longer timeframes given supply chain issues and labor shortages, neither of which the City controls.

Appendix B – Housing Constraints B-63
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Environmental Justice Element Requirement
An Environmental Justice Element or equivalent is not required for Carmel-by-the-Sea because no disadvantaged communities exist within the city’s boundaries (as defined in Gov. Code, §65302, (h)(4)(A)). “Disadvantaged communities” means an area identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code or a low-income area that is disproportionately affected by environmental pollution and other hazards that can lead to negative health effects, exposure, or environmental degradation.

Environmental Constraints
Environmental constraints affecting housing include geologic and seismic conditions and fire hazards, which are a threat to the built environment. These constraints are discussed in detail below. However, the primary environmental constraint to the development of housing in Carmel-by-the- Sea is the limited water supply, as already discussed.

Fire Hazards
Carmel-by-the-Sea is often referred to as a “Village in the Forest,” due to its extensive urban forest.

The high density of structures within the Carmel residential areas and business district among numerous trees increases the fire hazard. In addition, the Pescadero Canyon, Del Monte Forest, and Mission Trails Nature Preserve, located adjacent to the City, introduce the possibility of a wildland fire.

The currently adopted (October 2008) California Department of Forestry and Fire Protection (CAL FIRE) Very High Fire Hazard Severity Zones in Local Responsibility Areas (LRA) map for Carmel- by-the-Sea identifies a large area encompassing northern and eastern portions of the City as a Very High Fire Hazard Severity Zone. In such zones, roofs and exterior walls of new buildings must be made of noncombustible materials. It should be noted that all LRA maps across the state of California are undergoing updates and according to CAL FIRE are anticipated to be released sometime in 2024.

Obtaining insurance for structures is increasingly difficult given the Very High Fire Hazard Severity Zone, posing a constraint to residential development.

The City of Carmel-by-the-Sea is part of a regional coordination effort with other Monterey County cities, including Pacific Grove and Monterey. These neighboring agencies provide aid to each other on an as-needed basis. Fire protection for the City is provided by the City of Monterey Fire Department based out of the Carmel Fire Station located on 6th Avenue.

Emergency and Evacuation Planning
Emergency response is provided through coordinated efforts by the cities of Monterey, Pacific Grove, and Carmel. Emergency planning and evacuation pose many challenges for the City due to the precarious topography and narrow City roads. The General Plan Safety Element (both the currently adopted version and the updated Safety Element being prepared in conjunction with the 6th Cycle Housing Element) provides an in-depth analysis of emergency and evacuation planning and protocols, as well as scenario mapping and evacuation route mapping. City staff generally note that particularly in

Appendix B – Housing Constraints B-64
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Carmel, where small lots make meeting egress requirements difficult at higher densities, incentivizing lot mergers in the commercial district will help address concerns and challenges associated with emergency and evacuation planning across the City.

Seismic
The entire California Coast and Coast Range area is prone to earthquakes. Based on history, the probability of a moderate or high magnitude earthquake occurring in the greater Monterey region in the next few decades is quite likely. Faults that could present hazards to Carmel-by-the-Sea during an earthquake event include the following active or potentially active faults: San Andreas, San GregorioPalo Colorado, Chupines, Navy, and Cypress Point. The San Andreas and San Gregorio faults are two dominant faults within the Monterey County region that are considered active with evidence of historic or recent movement.

While the seismic hazards cannot be eliminated, there are a number of regulations that reduce the impact of these hazards. The Alquist-Priolo Earthquake Fault Zoning Act was passed in 1972 to mitigate the hazard of surface faulting to structures for human occupancy, by preventing the construction of buildings used for human occupancy on the surface trace of active faults. The California Building Code includes provisions associated with engineering design and building requirements that address seismic hazards. In addition, the City of Carmel-by-the-Sea General Plan includes policies addressing hazards from seismic activity.

Tsunami
The City would be minimally affected by a moderate to extreme tsunami event. This can be accredited to coastal topography along Carmel’s western boundary. The steep cliff, or a step-down in elevation between the Scenic Road and the beach, acts as a protective boundary during a tsunami event.

However, low lying portions of Carmel-by-the-Sea are susceptible to inundation from tsunami, known as waves produced from a seismic event. Only the southernmost portion of the City and the low-lying Carmel Lagoon neighborhood (within unincorporated Monterey County) could be impacted if a 21- foot-high tsunami wave were to enter the Carmel River lagoon. Impacts from tsunami could include damage to improvements from wave inundation and from wave-carried debris.

Tsunami is a potential safety hazard as well as a hazard to property. The actual areas that will be impacted from a tsunami will vary depending on factors such as the size of the tsunami wave, tide level at the time of the tsunami, the wave source location and the wave direction. In general, areas adjacent to the shoreline that are below an elevation of approximately 15 to 20 feet above mean sea level appear to have a higher level of risk.

Flooding
Carmel is located on a sloping terrain that offers good storm water runoff into both the Pacific Ocean and the Carmel River. Only a small portion of the City’s southern tip is designated as a FEMA 100- year Flood Zone. Carmel Beach is subject to flooding during high tide and beach sand is lost yearly during winter storms. The beach is clearly separated from adjacent roads and houses by a moderately

Appendix B – Housing Constraints B-65
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 steep hill. Due to that topographical feature, the coastal flooding rarely extends past the beach. There are several areas of the City, which have been identified in the City’s general plan as being prone to localized flooding. The main area subject to localized flooding is located within the Mission Trail Nature Preserve. The Mission Trail site is owned by the City and used as a park, and the City recently approved a CDP to correct flooding issues within Mission Trails Nature Preserve. This use mitigates some of the damage that would normally result from the retention of water on the site and the City recently approved a Coastal Development permit to correct some flooding issues in this area.

The City’s General Plan includes a Safety Element with policies and programs which address flooding (see policies P8-27 through P8-31). The Safety Element Update will also include and update where necessary the City’s policies and programs related to flooding. The City’s Municipal Code (Chapter

15.56 Community Floodplain) further addresses flood risks and hazards found in the City as well as identifying methods for reducing flood losses. In order to accomplish its purposes, this chapter of the municipal code includes regulations to:
1) Restrict or prohibit uses which are dangerous to health, safety, and property due to water or erosion hazards, or which result in damaging increases in erosion or flood heights or velocities;
2) Require that uses vulnerable to floods, including facilities which serve such uses, be protected against flood damage at the time of initial construction; 3) Control the alteration of natural floodplains, stream channels, and natural protective barriers, which help accommodate or channel floodwaters; 4) Control filling, grading, dredging, and other development which may increase flood damage; and
5) Prevent or regulate the construction of flood barriers which will unnaturally divert floodwaters or which may increase flood hazards in other areas. (Ord. 2018-03 § 1 (Exh. A §4), 2018).

Coastal Erosion and Landslides
Erosion on sloped inland areas and at the shoreline (beach) has been a problem for much of Monterey County, including Carmel. The hazards due to erosion are difficult to separate from those due to flooding and landsliding. In some cases, erosion is a result of flood and landslide conditions; in others, rapid water runoff and landsliding can occur in areas subject to prolonged erosion. The preventive costs of erosion are generally included within flood control measures and the overall costs of hillside development. Adoption of the present state of the art procedures for erosion prevention in hillside areas will, in most cases, eliminate losses.

Losses due to coastal erosion can be reduced most economically by avoiding construction in areas subject to severe erosion. Erosion of the beach bluffs is addressed in the City's Shoreline Management and Emergency Operations plans.

Appendix B – Housing Constraints B-66
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Summary of Non-Governmental Constraints
In summary, while Carmel-by-the-Sea is subject to the environmental constraints described above, the City’s General Plan sets forth a series of actions to minimize these constraints. Carmel-by-the- Sea incorporates this information into its land use planning and development review processes. In an effort to continue to reduce constraints to housing development, the Housing Element Update includes specific policies and programs in Chapter 2 to reduce or eliminate non-governmental constraints to the extent feasible and practical.

The primary non-governmental constraints and the 6th Cycle Housing Element programs to address them are shown in Table B-14 below:

Table B-14 Summary of Non-Governmental Constraints
Non-Governmental Constraint Programmatic Action
Land Availability and Cost
Carmel-by-the-Sea’s limited availability of land coupled with its desirable coastal location and world-renowned architecture has resulted in high cost of land and a lack of affordable housing.

Some of the primary factors that have contributed to high land costs in Carmel-by-the-Sea are its limited availably of land.

Program 3.1.A: Mixed Use Affordable Housing
Program 1.1.F: Overnight Visitor Accommodation (Conversion) Transfer of Development Rights.

Program 1.1.B: Development on Small Sites
Program 3.1.C: Density Bonus
Construction Costs
Costs of labor and materials are very high in Carmel-by-the-Sea and could be considered constraints on housing development.

Program 3.1.C: Density Bonus
Availability of Financing Program 2.1.D: Establish Affordable Housing Trust Fund Program 5.1.C: Shared Housing Information
Program 5.1.B: Housing Choice Voucher Program
Program 5.2.A: Support Community Organizations
Small Lots and Large Units Program 3.1.G: Establish Minimum Densities Seasonal Vacancies Program 2.1.D: Establish Affordable Housing Trust Fund

Sites Inventory C

APPENDIX

Appendix C – Sites Inventory C-2
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table of Contents
Appendix C Sites Inventory...............................................................................................................................C-4 C.1 Introduction........................................................................................................................................................C-4 C.2 Regional Housing Needs Allocation...............................................................................................................C-5 C.3 Regulatory Framework for Meeting the RHNA...........................................................................................C-8 C.4 Carmel-by-the-Sea Strategies for Meeting RHNA......................................................................................C-10 C.5 Summary of RHNA Strategies.......................................................................................................................C-59 C.6 Technical Background Documents...............................................................................................................C-61 Tables
Table C-1 Regional Housing Needs Allocation (RHNA) 2023-2031 ..........................................................................C-5 Table C-2 Remaining RHNA..............................................................................................................................................C-6 Table C-3 Projects Eligible for RHNA Credit.................................................................................................................C-6 Table C-4 ADU Development Trends............................................................................................................................C-11 Table C-5 Proforma of Sample Hotel-to-Residential Conversion..............................................................................C-12 Table C-6 Analysis of Hotel Key Value ..........................................................................................................................C-13 Table C-7 Carmel Hotels Grouped by Performance (RevPAR).................................................................................C-14 Table C-8 Carmel Hotels and Hotel Room Inventory .................................................................................................C-14 Table C-9 Hotel Room Conversion Potential................................................................................................................C-16 Table C-10 Affordable Housing Potential on Church Properties..............................................................................C-20 Table C-11 Distribution of Lot Sizes ..............................................................................................................................C-21 Table C-12 Affordable Housing Projects on Small Sites .............................................................................................C-22 Table C-13 Regional Redevelopment Trends ................................................................................................................C-24 Table C-14 Rent Comparison: Residential vs Commercial..........................................................................................C-26 Table C-15 Properties with Live/Work Potential for Lower-Income Housing.......................................................C-29 Table C-16 Mixed-Income Incentive Program Sites.....................................................................................................C-34 Table C-17 Past Mixed-Use Development Projects......................................................................................................C-37 Table C-18 Additional Scattered Sites.............................................................................................................................C-41 Table C-19 Site #S-1 Forest Cottages Specific Plan: Site Description ......................................................................C-42 Table C-20 Site #S-2 Court of the Fountains: Site Description .................................................................................C-44 Table C-21 Site #S-2 Court of the Fountains: Capacity Assumptions......................................................................C-44 Table C-22 Site #S-4 Office Building: Site Description...............................................................................................C-45 Table C-23 Site #S-4 Office Building: Capacity Assumptions....................................................................................C-46 Table C-24 Site #S-5 Yafa: Site Description..................................................................................................................C-47 Table C-25 Site #S-5 Yafa: Capacity Assumptions.......................................................................................................C-48

Appendix C – Sites Inventory C-3
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-26 Site #S-7 Carmel Realty Office: Site Description.....................................................................................C-49 Table C-27 Site #S-7 Carmel Realty Office: Capacity Assumptions..........................................................................C-49 Table C-28 Site #S-8 Parashis/Millard Building: Site Description.............................................................................C-51 Table C-29 Site #S-8 Parashis/Millard Building: Capacity Assumptions..................................................................C-51 Table C-30 Site #S-9 The Agency: Site Description.....................................................................................................C-52 Table C-31 Site #S-9 The Agency: Capacity Assumptions..........................................................................................C-53 Table C-32 Site #S-10 Enzos: Site Description.............................................................................................................C-54 Table C-33 Site #S-10 Enzos: Capacity Assumptions..................................................................................................C-54 Table C-34 Site #S-11 Paseo San Carlos Square: Site Description ............................................................................C-56 Table C-35 Site #S-11 Paseo San Carlos Square: Capacity Assumptions..................................................................C-56 Table C-36 Site #S-12 Carmel Office Supply & Business Center: Site Description ...............................................C-58 Table C-37 Site #S-12 Carmel Office Supply & Business Center: Capacity Assumptions ....................................C-58 Table C-38 Summary of Sites Inventory.........................................................................................................................C-59 Table C-39 Basic Pro Forma of Hotel-to-Residential Program..................................................................................C-61 Figures
Figure C-1 Trevvett Court.................................................................................................................................................C-22 Figure C-2 Examples of Underutilized Commercial Spaces........................................................................................C-26 Figure C-3 Live/Work Adaptive Re-Use Case Study ...................................................................................................C-28 Figure C-4 Mixed-Income Case Study - "Midblock" ....................................................................................................C-32 Figure C-5 Mixed-Income Case Study - "Corner Site".................................................................................................C-32 Figure C-6 Mixed-Income Case Study - "Adaptive Re-Use".......................................................................................C-33 Figure C-7 Sites Inventory Map .......................................................................................................................................C-60

Appendix C – Sites Inventory C-4
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Appendix C Sites Inventory
C.1 Introduction
The Association of Monterey Bay Area Governments (AMBAG) forecasts that the two-county (Monterey and Santa Cruz) Monterey Bay Area will add 32,867 new households between 2020 and 2045.1 For the 8-year time frame covered by this 6th Cycle Housing Element Update, the State Department of Housing and Community Development (HCD) has identified the region’s housing need as 33,274 units. The total number of housing units assigned by HCD is separated into four income categories that cover housing types for all income levels, from very low-income households to abovemoderate income (market rate) housing. This calculation, known as the Regional Housing Needs Allocation (RHNA), is based on population projections produced by the California Department of Finance (DOF) as well as adjustments that incorporate the region’s existing housing need. The adjustments result from recent legislation requiring HCD to apply additional adjustment factors to the baseline growth projection from the DOF in order for the regions to get closer to healthy housing markets. To this end, adjustments focus on the region’s vacancy rate, level of overcrowding, and the share of cost burdened households, and seek to bring the region more in line with comparable ones.

These new laws governing the methodology for how HCD calculates the 6th Cycle RHNA resulted in a significantly higher number of housing units for which the Monterey Bay Area must plan compared to previous Housing Element cycles.

Revised Sites Inventory Strategy
In April 2024, the City of Carmel-by-the-Sea adopted the 6th Cycle Housing Element, which was found to be compliant with state law by the California Department of Housing and Community Development (HCD) on April 25, 2024. In pursuing the implementation of its adopted Housing Element, the City has come to realize that certain sites may be challenging to develop and that diversifying its housing stock and better integrating new housing throughout the community will yield faster and more successful affordable housing. In response, a group of resident volunteers came together called the Affordable Housing Alternatives Group, or “AHA.” AHA is composed of a highly motivated group of residents that have devoted their energy and talents to crafting policies tailored to Carmel that will address the City’s housing needs. In partnership with City staff, the AHA Group provided thousands of volunteer hours, met with City staff on a weekly basis (often more frequently), leveraged community connections to identify property owners interested in adding new housing on their properties, attended meetings with HCD, and genuinely dedicated themselves to finding housing solutions with the best chance of becoming reality. One of the many benefits that grew out of this collaboration was the development of an alternative sites strategy for meeting the City’s RHNA that provides a more viable path to the creation of affordable housing opportunities within the village. This new Appendix C replaces the previously adopted Appendix C (April 2024) and represents the culmination of efforts by 1 Source: Final 2022 Regional Growth Forecast, AMBAG, November 18, 2020

Appendix C – Sites Inventory C-5
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 AHA members, the Carmel community, and City staff to refine the Housing Element in a way that maximizes the potential for affordable housing development in the City.

C.2 Regional Housing Needs Allocation
RHNA Summary
AMBAG adopted its Final 6th Cycle Regional Housing Needs Allocation Plan 2023-2031 on October 12, 2022. The Plan was approved by HCD on November 8, 2022. For Carmel-by-the-Sea, the RHNA to plan for in this cycle is 349 units. Details are provided below.

Carmel-by-the-Sea’s share of the regional housing need for the 8-year period from 2023 to 2031 is 349 units, which is a 1,025 percent increase over the 31 units required during the 2014 to 2023 RHNA cycle. The housing need is divided into four income categories: Very Low Income, Low Income, Moderate Income, and Above Moderate Income (i.e., market rate). Table C-1 shows Carmel-by-theSea’s RHNA for the 2023-2031 planning period.

Table C-1 Regional Housing Needs Allocation (RHNA) 2023-2031 Income Group
Carmel-bythe-Sea
Units Percent
Monterey
County
Units Percent
Monterey
Bay Area
Units Percent
Very Low Income
(<50% of AMI)
113 32.3% 4,412 21.8% 7,868 23.6%
Low Income
(50%-80% of AMI)
74 21.2% 2,883 14.2% 5,146 15.5%
Moderate Income
(80%-120% of AMI)
44 12.6% 4,028 19.8% 6,167 18.5%
Above Moderate Income
(>120% of AMI)
118 33.9% 8,972 44.2% 14,093 42.4%
Total 349 100.0% 20,295 100.0% 33,274 100.0%
Source: AMBAG 2021
Note: The Association of Monterey Bay Area Governments (AMBAG) Executive Board adopted the 2023-2031 Regional Housing Needs Allocation Plan (RHNA) on October 12, 2022 (Resolution No. 2022-24). The plan was approved by the California Housing and Community Development on November 8, 2022.

Progress Toward RHNA
The RHNA planning period for the 2023-2031 Housing Element (6th Cycle) is June 30, 2023 through December 15, 2031. The statutory adoption date for the 6th Cycle Housing Element is December 15, 2023 – 6 months after the beginning of the RHNA planning period. To account for this discrepancy, the City of Carmel-by-the-Sea can receive credits for the number of housing units entitled, permitted, or under construction since the beginning of the projection period, up to the data cutoff date for the writing of this Housing Element (December 31, 2024) and apply these to the RHNA. Accordingly, the units permitted in this 18-month period count toward the 2023-2031 Housing Element (6th Cycle) and are subtracted from the City’s RHNA of 349 units.

Appendix C – Sites Inventory C-6
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-2 provides a summary of the City’s remaining RHNA obligations after accounting for eligible credits. Table C-3 lists three housing projects (totaling 23 units) that are either permitted, underway, or constructed during the RHNA projection period, eligible for RHNA credits. Eligible credits also include 45 ADUs that have earned approval for entitlements and/or permits and will begin construction during the 6th Cycle Housing Element. Therefore, the City has a remaining RHNA of 281 units for which the City must identify adequate sites.

Table C-2 Remaining RHNA
Very LowIncome UnitsLow- Income
Units
ModerateIncome UnitsAbove ModerateIncome UnitsTotal
Units
2023–2031 RHNA 113 74 44 118 349
Units permitted between June 30,
2023 and December 31, 2024
13 13 13 29 68
Remaining RHNA 100 61 31 89 281
Source: City of Carmel-by-the-Sea, Community Planning & Building Department Table C-3 Projects Eligible for RHNA Credit
APN
Project
Name Zoning
General
Plan Land
Use Area
Min.

Density
(du/ac) VLI LI MI AM Tenure
Entitlement
Status
010138003000 Ulrika
Plaza
Service
Commercial
(SC)
Core
Commercial

0.37 33 -- -- -- 12 Rental Approved
010138021000
010145012000 JB
Pastor
Service
Commercial
(SC)
Core
Commercial

0.27 33 -- -- -- 8 Rental Conditionally
Approved 010145024000
010145023000
010146010000 Scandia
Lopez
Central
Commercial
(CC)
Core
Commercial

0.09 33 -- -- -- 3 Rental Permitted
and under
construction
Subtotal 0 0 0 23
ADUs 13 13 13 6 Rental Approved/
Permitted/
Constructed
Totals 13 13 13 29 Total RHNA Units
= 68
Source: City of Carmel-by-the-Sea, 2025
Notes: VLI = very low-income; LI = low-income; MI = moderate-income; AM = above moderate-income.

Projects Eligible for RHNA Credits
Ulrika Plaza (Site No. P-1)
The Planning Commission approved the Ulrika Plaza project on August 9, 2023. On December 13, 2024, a building permit application was submitted to the City for demolition of existing improvements to prepare the site for new construction. On March 3, 2025, a building permit application for the construction of a new mixed-use building was submitted to the City and is currently in plan check review. Demolition work to prepare the site began in early September under a separate building permit.

The project is slated to begin full construction by the end of 2025. The 16,000-square-foot (0.37 acre) project site includes a 22,400 square foot mixed-use building with 9,000 square feet of ground-floor

Appendix C – Sites Inventory C-7
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 retail, 12 market rate residential units, and 28 parking spaces in an underground garage. The project density is 33 dwelling units per acre.

The project, previously known as Del Dono and Del Dono II, resulted from merging two 8,000- square-foot lots to create a 16,000-square-foot site. In this first incarnation of the project, the original developer planned to construct a mixed-use building containing ground-floor commercial space and 16 residential units, two of which were to be affordable to moderate income households. The project density was 44 dwelling units per acre. The project was approved and broke ground in 2019. A twostory commercial building with underground parking was demolished on the north lot, and a one-story commercial building with a surface parking lot was demolished on the south lot. The developer lost their funding during construction of the underground parking structure and the property was subsequently sold and redesigned as Ulrika Plaza.

This project is an example of the redevelopment of underutilized commercial buildings and a surface parking lot in the Service Commercial (SC) District. All land use entitlements have been obtained.

JB Pastor Building (Site No. P-2)
The Planning Commission approved the JB Pastor project on April 9, 2025. The project site is a 12,000-square-foot (0.27 acre) commercial parcel. The site is composed of three legal lots of record and is currently developed with a two-story, historic community room building, surface parking, a one-story commercial building, and a two-story mixed-use building (office & residential). The Planning Commission approved demolition of all existing site improvements, excluding the historic community room, and constructing two 2-story mixed use buildings totaling approximately 12,900 square feet with ground floor commercial space, eight market rate second-floor apartments, and 12 onsite parking spaces. The project density is 29 dwelling units per acre.

On April 23, 2025, an appeal of the Planning Commission’s approval of the project was filed and on August 4 and September 8, 2025, the City Council heard the appeal, denying portions of the appeal and upholding others. Specifically, the City Council found that the developer did not sufficiently demonstrate the infeasibility of providing parking on-site and did not meet the required landscape threshold of 50% of the open space areas. The City Council remanded the project back to the Planning Commission with specific direction so that the applicant has the opportunity to make revisions to the project.

In December 2025, staff met with the Developer to review a revised project concept that includes reducing the amount of commercial square footage and increasing the number of residential units from eight to twelve inclusive of three affordable housing units. The revised project would meet the on-site parking requirements. There are no known barriers to the project being permitted in the planning period. The Developer plans on making a formal application submittal to the City in July 2026 with construction commencing in November 2027 and completing in May 2029.

This project is an example of the redevelopment of underutilized commercial properties, including a surface parking lot in the Service Commercial (SC) District.

Appendix C – Sites Inventory C-8
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Scandia Lopez/Hakim (Site No. P-3)
The Planning Commission approved additions to the historic Percy Parkes Building for three (3) new market rate apartments on July 13, 2022. The 4,000-square-foot (0.09 acres) project site includes a 2,750 square foot one-story historic commercial building. The project consists of a second floor addition to the existing commercial building and the construction of a two-story building in the courtyard behind the existing building. The project density is 33 dwelling units per acre.

This project is an example of additions to a one-story historic commercial building in the Central Commercial (CC) District to provide housing. The commercial tenant relocated to another retail space within the village prior to approval of the project. All land use entitlements have been obtained. No appeals of the project were filed. A building permit was issued in April 2025 and the project is currently under construction.

Accessory Dwelling Units
Between July 1, 2023 and December 31, 2024, the City issued certificates of occupancy and building permits, and is in the process of reviewing additional ADU applications, for a total of 45 ADUs and JADUs as documented in the City’s Housing Element Annual Progress Reports submitted to HCD.

The City continues to see a strong interest in ADUs and expects that trend to continue throughout the planning period.

In reviewing the City’s ADU construction activities between 2017 and 2024, 64 ADU applications were processed in the City. Among these units, 15 (24 percent) were for units smaller than 300 square feet and 20 (32 percent) were between 301 and 500 square feet. Also 31 (49 percent) were for conversion from existing spaces (these units tend to be smaller and less expensive to construct, and therefore are more likely to be affordable). Based on a review of rental unit sizes in Monterey County, average unit sizes in the region are:
▪ Studio - 420 square feet
▪ One-bedroom - 646 square feet
▪ Two-bedroom - 938 square feet
Overall, 41 percent of the City’s ADUs between 2017 and 2024 were significantly smaller than the average sized ADU in the region for that bedroom count. Rental rates for these smaller ADUs are reasonably expected to be lower than market rate, regularly sized units. Furthermore, discussions with local realtors indicate that many ADUs are occupied by caretakers at reduced or no costs. Therefore, the City uses the 30/30/30/10 income/affordability distribution approved for the ABAG jurisdictions and also used by most AMBAG jurisdictions for the 6th cycle Housing Element update. Overall, the 45 ADUs permitted are distributed into 13 very low income, 13 low income, 13 moderate income, and 6 above moderate income.

C.3 Regulatory Framework for Meeting the RHNA
The purpose of the Sites Inventory is to identify and analyze specific sites that are available and suitable for residential development to accommodate Carmel-by-the-Sea’s remaining assigned 281 housing

Appendix C – Sites Inventory C-9
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 units. The City is not responsible for building the housing, but must provide adequate capacity through land use policies and zoning regulation to accommodate the remaining RHNA.

Sites to Accommodate Lower-Income RHNA
Sites Used in Previous Housing Element Planning Periods Government Code §65583.2(c)
Each site includes information about whether it was used in a prior Housing Element planning period, if it is currently vacant, and the number of anticipated housing units by income category.

Appropriate Zoning
Government Code §65583.2(c)(3)
Under state law, the “default density” for suburban jurisdictions such as Carmel-by-the-Sea, is at least 20 dwelling units per acre. At this density, a project site is deemed appropriate to accommodate lowerincome housing. The General Plan designation that meets this requirement is Multi-Family Residential (and/or zoning at R-4), with a maximum density of 33 dwelling units per acre, or 44 dwelling units per acre with a local Bonus Density when affordable units are provided.

Residential uses are also permitted in the City’s CC, SC, and RC zones, up to 22 units per acre by right and 33 units per acre with a conditional use permit. Projects meeting the local Bonus Density incentive may reach 44 units per acre. A 100 percent affordable housing project may reach 88 units per acre, inclusive of all state and local bonuses.

The City is implementing Program 3.1.G to change the maximum allowable density of 33 dwelling units per acre to a maximum allowable base density of 40 units per acre in the Commercial (CC, SC, and RC) Districts and the Multi-Family Residential (R-4) District. Combining local and state density bonuses, the total capacity can reach 88 units per acre. The City is also instituting a minimum density of 22 dwelling units per acre in the Commercial (CC, SC, and RC) Districts and in the Multi-Family Residential (R-4) District. These changes will enable a higher yield of residential units, rather than larger units at a lower yield, which is likely to result in increased financial feasibility for the development of affordable units.

In addition, the City is modifying the Municipal Code to broaden the eligibility for receiving up to a total of 88 du per acre, inclusive of all state and local bonuses, in commercial zones from 100 percent affordable housing projects to projects that qualify for the Mixed-Income Incentive Program.

Site Size
Government Code Section 65583.2(c)(2)(A), (B), and (C)
Several factors outside of the City of Carmel-by-the-Sea’s control impact the availability and developability of land throughout the village. The incorporated area of Carmel-by-the-Sea is onesquare-mile, bordered by Pescadero Canyon to the north and Carmel Bay to the west. The City is located entirely within the Coastal Zone and has a certified Local Coastal Program that complies with the policies of the California Coastal Act. It is also built-out and composed of small lot sizes. The

Appendix C – Sites Inventory C-10
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 original subdivision maps for the City (recorded in 1888 and 1902) established a grid pattern of commercial lots ranging in size from 2,500 square feet (0.057 acres) to 4,000 square feet (0.09 acres).

While some parcels have been combined, many remain in their original configuration today.

No Net Loss
Government Code Section 65863
Through the 8-year RHNA planning period of the 6th Cycle Housing Element, pursuant to the State of California’s No Net Loss Law, the City is required to identify an alternative site(s) if a site on the Sites Inventory is developed at a lesser ratio of lower-income units than planned. Program 1.1.A will regulate this requirement of No Net Loss for the 6th cycle (see Chapter 2).

Reliance on Nonvacant Sites to Accommodate More than 50 Percent of the RHNA for Lower-Income Units
Government Code Section 65583.2(g)(2)
Per state law, when more than 50 percent of the sites intended to accommodate the RHNA for lowerincome households are nonvacant sites, the resolution adopting the Housing Element must include findings stating that the uses on these sites are likely to be discontinued during the planning period and outline the factors used to make that determination.

C.4 Carmel-by-the-Sea Strategies for Meeting RHNA
To fully accommodate the remaining RHNA and to foster housing opportunities throughout the community, the City is pursuing the following strategies:
▪ Promote the development of Accessory Dwelling Units (ADUs) ▪ Facilitate the conversion of underperforming hotels into affordable housing ▪ Pursue the development of affordable housing on religious facility sites ▪ Facilitate conversion of underutilized commercial spaces into affordable live/work housing ▪ Incentivize mixed-income affordable projects downtown Accessory Dwelling Units (ADUs)
Assumptions and Analysis
ADUs represent a significant opportunity for Carmel-by-the-Sea to provide affordable housing throughout the community. Pursuant to state law, local jurisdictions are able to project the number of ADUs over the 8-year planning period based on the demonstrated trend of recent ADU production.

Between 2019 and 2024 (Table C-4), the City issued building permits for 61 ADUs, with a sharply rising trend over the past 2 years, yielding an annual average of 10.2 units.

Appendix C – Sites Inventory C-11
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-4 ADU Development Trends
2019 2020 2021 2022 2023 2024 Average
Permitted ADUs 4 8 9 8 13 19 10.2
Source: City of Carmel-by-the-Sea, Community Planning & Building Department Capacity During 6th Cycle Planning Period
Based on a historical average of 10 ADUs per year, the City estimates that 70 ADUs could be constructed over the remaining 7 years (2025-2031) of the 8-year planning period.

Proactive Efforts to Accelerate Affordable ADU Development The City recognizes the significant potential role that ADUs can play in providing affordable housing.

This Housing Element includes a program to accelerate the development of ADUs, particularly affordable ADUs, during the planning period. These efforts are designed to accelerate the City’s ADU trend, which has already risen sharply in recent years. The City anticipates that this program will generate a potential 10 percent boost to its trends, resulting in an additional 7 ADUs, for a total of 77 ADUs over the remaining seven years (2025-2031) of the 8-year planning period.

Occupancy and Income/Affordability
Based on local knowledge, some ADUs are not used as rentals. Conservatively, the City discounts the ADU trend by 10 percent to account for potential ADUs with nonresidential uses. The 10 percent discount on the trend produces a conservative projected number of 70 ADUs. Using the previously discussed income/affordability distribution of 30 percent very low income, 30 percent low income, 30 percent moderate income, and 10 percent above moderate income, ADUs are projected to contribute 7 extremely low, 14 very low income, 21 low income, 21 moderate income, and 7 above moderate income units to the City’s future housing stock over the course of the planning period.

Hotel-to-Residential Conversion
Assumptions and Analysis
Hotel-to-Residential Conversion Program (Hotel ‘Key’ Transfer) – How it Works As noted in the description in Chapter 2, the goal of the Hotel-to-Residential Conversion Program is to incentivize hotel owners to convert underperforming hotels into mixed-income multifamily residential by creating a new legal right to sell the “hotel keys” associated with the converted hotel rooms (which are particularly valuable in light of the cap on the number of hotel rooms in the City). The intention is to provide property owners that undertake conversion projects with an above market return by allowing them to “sell the property twice” – i.e., by profiting from both the residual market value of the converted hotel and the market value of the hotel keys. The sample proforma in Table C-5 below illustrates the mechanics.

Consider a hypothetical 19-room hotel property with an average daily rate (ADR) of $211 and a 68% occupancy rate, equating to $143 in revenue per available room (RevPAR). In relation to other hotels in Carmel-by-the-Sea, such a hotel would operate below the 16th percentile in terms of performance (see

Appendix C – Sites Inventory C-12
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 the following section), making it a prime candidate for the Hotel-to-Residential Conversion Program.

Assume further that the hotel’s 19 rooms are converted into 16 mixed-income apartment units (a roughly 85% conversion ratio) with the following income distribution: 4 very low, 4 low, 4 moderate, and 4 above moderate income. If a developer were to acquire the hotel from the existing hotel owner at a 4.50% cap rate for $7,675,580 and invest $1,600,000 in capital expenditures to convert the hotel rooms into apartments ($100,000 per unit), the developer’s total cost basis would be $9,275,580.

Assuming a projected net operating income of $302,717 and a cap rate of 6.00%, the former hotel (now mixed-income apartments) would sell for $5,045,280, which would result in an approximately $4.2 million loss for the developer. However, when the proceeds from the sale of the 19 hotel keys is taken into consideration (an estimated $438,656 per key multiplied by 19 keys equals $8,334,464 (see below for further analysis on how the value of keys is estimated), the gross proceeds from the overall investment rises to $13,379,744, resulting in a total profit of $4.1 million and a return on investment (ROI) of approximately 44%. Such a return is substantially above market for a commercial real estate investment with this risk profile, and has already generated a high degree of interest in the program on the part of developers and local hotel owners.

Table C-5 Proforma of Sample Hotel-to-Residential Conversion Conversion of 19-Room Hotel to 16-Unit Affordable Housing Purchase Price of Hotel $7,675,580
Housing Conversion Costs (@ $100,000 per room) $1,600,000 Total Developer Investment $9,275,580
Sale of Hotel Keys (@ $438,656 per key) $8,334,464
Sale of Affordable Housing Building $5,045,280
Total Developer Return $13,379,744
Profit $4,104,164
Return on Investment (ROI) 44%
Analysis of Hotel Key Value
To estimate the value that a Carmel hotel key could be sold for – the $438,656 per key used in the proforma above – a residual land value analysis was performed with respect to the keys (Table C-6). A common valuation method in the commercial real estate space, a residual land value analysis is used to calculate how much a developer can pay for land while still hitting their target return. Here, we assume that the hotel key is being purchased by a hotel developer or operator that already owns land in Carmel, so the relevant question becomes: how much can the purchaser of the hotel key pay for the key while still hitting their target return? Let’s assume that the buyer of the hotel key projects an average daily rate of $450 and a 65% occupancy rate, equating to revenue per available room (RevPAR) of $293 and annual revenue of $106,763 for this to-be-built hotel room. If we assume that operating expenses are 45% of revenue, that would result in an annualized net operating income of $58,719. At a 6.00% cap rate, this hotel room would be worth $978,656 once constructed. Given this value, how much can the purchaser of the hotel key pay for the key while still hitting their return target? Conservatively assuming $1,000 per square foot in construction costs, the cost of a typical 400 square foot hotel room would be $400,000 If the buyer of the hotel key has an industry-standard target ROI of 35%, this equates to a target profit of $140,000. In such a scenario, the residual value of the hotel key – i.e., the most the

Appendix C – Sites Inventory C-13
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 purchaser of the hotel key could pay for the key – is $438,656, which is the number used in the proforma in Table C-5 above. It is important to note that the City has no plan to set or regulate the price of hotel keys, but is only performing an analysis to estimate what the market value of a key would be.

Table C-6 Analysis of Hotel Key Value
Residual Key Value Analysis
Average Daily Rate $450
Occupancy 65%
RevPAR $293
Annual Revenue $106,763
Operating Expenses as % of Revenue 45%
Net Operating Income $58,719
Value (@ 6% Cap Rate) $978,656
Construction Cost $400,000
Profit (@ 35% ROI) $140,000
Residual Key Value $438,656
Return on Investment (ROI) 35%
Capacity During the 6th Cycle Planning Period
Outreach and Developer and Hotel Owner Interest
In recent months the City and members of the AHA Group have held several meetings with hotel owners, affordable housing developers, and hotel developers to discuss the Hotel-to-Residential Conversion Program. These groups have expressed strong interest in the program.

The City and AHA Group have met with a mix of sophisticated, experienced developers, ranging from regional players to national firms with a broader focus. These include firms specializing in affordable housing, employee housing, and hospitality property redevelopment. They have provided valuable input on how to make the City’s incentives more attractive, highlighted similarities between the program and successful models elsewhere, and expressed active interest in participating once the program launches.

In addition to engaging with developers, the City and the AHA Group have also met with a number of hotel owners. These owners have shown a strong interest in exploring opportunities under the Hotelto-Residential Conversion Program. Hotel owners recognize that the program will allow participating developers to pay a higher price for their properties and are enticed by the potential for above-market returns.

This outreach demonstrates that there is a strong pool of capable and interested partners—both local and nonlocal—ready to collaborate with the City on converting underused hotel properties into muchneeded mixed-income housing.

Identification of Hotel Room Opportunities Based on Existing Conditions Based on data collected by the City from Transient Occupancy Tax (TOT) for Fiscal Year 2023-24, hospitality properties were graded on a curve (norm-referenced grading), based on revenue per available room or “RevPAR” (Table C-7).

Appendix C – Sites Inventory C-14
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-7 Carmel Hotels Grouped by Performance (RevPAR) RevPAR Hotels Rooms % of Total Rooms
Group 1 >$319 7 117 12%
Group 2 $231 - $318 12 287 30%
Group 3 $188 - $230 8 169 18%
Group 4 $144 - 187 8 239 25%
Group 5 $100 - $143 7 140 15%
Total 42 952
Groups 4 and 5 in the table above include properties whose revenue per available room (RevPAR) falls between 0.5 and 1.5 standard deviations below the market average. Specifically, with a market average RevPAR of $231.31 and a standard deviation of $87.56, this range encompasses properties with RevPARs between approximately $100 and $187. These hotels are considered underperformers relative to the broader market and operate below the 16th percentile of market performance. All told, there are 15 hotels that are underperforming (i.e., in groups 4 and 5). These underperforming hotels have 379 total rooms, representing approximately 40 percent of Carmel’s total hotel room inventory.

Table C-8 Carmel Hotels and Hotel Room Inventory
Site No. APN Address
Overnight Visitor Accommodation
Establishment Name
No. of
Rooms*
H-1 010148015000 Dolores & 8th Adobe Inn 20
H-2 010095010000 Junipero between 5th & 6th Best Western Carmel Bay View Inn 56 H-3 010136023000 5th & San Carlos Best Western Carmel’s Townhouse Lodge
28 H-4 010131011000 San Carlos between 4th & 5th Briarwood Inn 12 H-5 010131013000 E/S San Carlos between 4th & 5th Briarwood Inn II/Holland Court Inn 11 H-6 010136022000 San Carlos between 4th & 5th Candle Light Inn 20 H-7 010286015000 San Antonio & 13th Carmel Beach Hotel & Spa 22 H-8 010268008000 San Antonio & 8th Carmel Cottage Inn LLC 5 H-9 010124009000 SE Dolores & 3rd Carmel Country Inn LLC 12 H-10 010136021000 San Carlos @ 4th Carmel Fireplace Inn 22 H-11 010104002000 4th & Torres Carmel Garden Inn 10
H-12 010195501500 7th & Casanova Carmel Green Lantern Inn 17 H-13 010096006000 Junipero & 5th Carmel Inn & Suites 20 H-14 010097018000 Mission & 5th Carmel Oaks 17
H-15 010021024000
010021025000
010021002000
010021003000
010021026000
010021027000
010021028000
010021029000
Carpenter between 1st & 2nd Carmel Resort Inn 30
H-16 010094002000 Ocean & Junipero Carmel Village Inn/Le Petit Pali 34 H-17 010123005000 4th @ Mission Street Carmel Wayfarer Inn 17 H-18 010087002000 Junipero between 7th & 8th Carriage House Inn 13 H-19 010142002000 San Carlos @ 7th Coachman’s Inn 30
H-20 010094001000 Torres & Ocean Ave Comfort Inn Carmel by the Sea 19 H-21 010147008000 7th & Lincoln Ave Cypress Inn 44

Appendix C – Sites Inventory C-15
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site No. APN Address
Overnight Visitor Accommodation
Establishment Name
No. of
Rooms*
H-22 010287008000 San Antonio, 4 SE of 13th Edgemere Cottages Closed H-23 010085005000 SW Ocean/Torres Forest Lodge 4
H-24 010124001000
010124014000
2 NW of 4th on San Carlos Hofsas House 37
H-25 010109015000 SWC 3rd & Junipero Horizon Inn 20
H-26 010123014000 4th & San Carlos Hotel Carmel 27
H-27 010191005000 Monte Verde @ 7th L’Auberge Carmel 20 H-28 010264007000 8th & Camino Real La Playa Hotel 75
H-29 010261014000 SE Camino Real & Ocean Lamplighter Inn 6 H-30 010214032000 Ocean @ Monte Verde Lobos Lodge 30
H-31 010196027000 Monte Verde & 7th Monte Verde Inn 10
H-32 010201013000 Monte Verde @ 7th Monte Verde Inn East 7 H-33 010196001000 Ocean & Monte Verde Normandy Inn 48
H-34 010104005000 SEC 3rd & Junipero Ocean View Lodge 6 H-35 010273014000 Camino Real between 11th & 12th Sea View Inn 8*** H-36 010131028000 San Carlos at 5th Stilwell Hotel 42** H-37 010261015000 Camino Real 2 SE of Ocean Sunset House 5 H-38 010124012000 4th & San Carlos Svendsgaard’s Inn 35 H-39 010214029000 Monte Verde & 6th Tally-Ho Inn 12
H-40 010087003000 Junipero between 7th & 8th The Hideaway/Le Petit Pali @ 8th 24 H-41 010148007000 NE Corner Lincoln & 8th The Homestead 12 H-42 010213003000 Ocean between Lincoln/Monte
Verde
The Pine Inn 49
H-43 010109016000 Mission @ 3rd Ave Tradewinds Carmel 28 H-44 010136016000 Dolores & 4th Vagabond House 13
H-45 010087013000 7th & Mission Wayside Inn 22
Note: Hotels organized in alphabetical order only, not ranked. *The total number of rooms currently available in the City exceeds the cap of 948 established in the General Plan and Carmel Municipal Code Section 17.56.020
**Closed for remodel during data gathering and not included in program analysis. *** B&B and not included in the program analysis.

Capacity Calculations
There are 379 hotel rooms in the 15 underperforming hotels in Groups 4 and 5 (see Table C-7). While some of Carmel’s hotels were originally apartments with kitchenettes, a portion of these hotel rooms may need to be merged with other hotel rooms to accommodate modern apartment living or to create additional bedrooms. On the other hand, hotels have additional square footage dedicated to lobby space and back of house operations, which can be repurposed into apartment units. Due to high construction costs and developers expressing interest in maximizing density under an adaptive reuse scenario, the City anticipates a hotel to housing conversion ratio of 85% (i.e., that 85 mixed-income apartments will be generated for every 100 hotel rooms converted through the program).

A sampling of three existing hotels, ranging from 13 to 22 rooms, was conducted and identified room sizes ranging from 498 to 635 square feet. This, coupled with public and back of house spaces utilized for housing (as noted above) validates the assumption of an 85% conversion rate. Based on this information, conversion of the underperforming hotel rooms could yield a total of 322 apartments.

Appendix C – Sites Inventory C-16
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 The City’s proposed program would require that at least 75 percent of the converted units become deed-restricted affordable units. More specifically, the proposed income distribution is 25 percent very low income; 25 percent low income; 25 percent moderate income; and 25 percent above moderate income.

While initial outreach efforts have generated overwhelming support and interest, the City recognizes that not every owner of a hotel in Groups 4 and 5 will pursue this option during this Housing Element cycle. A more conservative estimate is that 50 percent of the hotel rooms will be converted to mixedincome housing through this program. Applying the conservative assumption of an 85 percent hotel room to apartment conversion ratio (379 to 322), and then a further 50 percent reduction on those hotel rooms expected to convert during the 6th Cycle Housing Element planning period (322 to 161), the City is assuming that 161 housing units could result from this program in the 6th Cycle. The foregoing notwithstanding, it should be noted that all hotels are eligible to participate in the program.

The incentives are not restricted to only the underperforming hotels.

Table C-9 Hotel Room Conversion Potential
Rooms/Units
Hotel Rooms within Groups 4 and 5 379
Hotel Rooms to Housing Units Conversion (85%) 322
Hotel Conversions During 6th Cycle Planning Period (50%) 161 Income Mix of 161 Rooms
Very Low Income (25%) 40
Low Income (25%) 40
Moderate Income (25%) 40
Above Moderate Income (25%) 41
Zoning, Infrastructure, and Environmental Constraints
Hotels identified for potential participation in this program are all located in zoning districts where residential uses are permitted. No zoning constraints are identified.

Hotel-to-residential conversions are most likely to occur through adaptive reuse of existing buildings.

These are developed properties that are currently served with infrastructure and utilities. Given that this program is unlikely to include ground-up new construction, the City does not anticipate any environmental conditions or impacts that would preclude or significantly constrain the adaptive reuse of existing properties.

Affordable Housing on Religious Facility Properties
Capacity During 6th Cycle Planning Period
Outreach and Owner Interest
The City engaged with the five churches in the community and received strong interest in exploring opportunities to develop affordable housing.

Appendix C – Sites Inventory C-17
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 On November 19, 2024, the Affordable Housing Alternatives (AHA) Group hosted the Faith & Homes community meeting at the Sunset Center. Representatives from all five Carmel-by-the-Sea churches attended the meeting and showed interest in the group's effort to integrate workforce housing throughout the community. Also in attendance were architects and developers interested in partnering with AHA and the church community to facilitate housing in Carmel. The program included presenters from various backgrounds and disciplines, all speaking with a focus on the goal of finding ways to make development of affordable housing on church sites easier.

Following the meeting, the AHA Group reached out via email to provide church representatives with additional resources and offered to meet again with representatives from individual churches to answer follow-up questions.

Two members of the AHA group formed a subcommittee to focus on engagement with the church community. In coordination with City staff, a regulatory analysis of the five church properties was undertaken to provide churches with a better understanding of the opportunities available for housing development on their sites. The analysis included a summary of state legislation and local regulations applicable to properties owned by religious institutions. The goal was to give local churches a head start on their planning efforts as they approach design professionals to start sketching out possibilities.

On March 5, 2025, AHA and city staff met with representatives of the First Church of Christ, Scientist to provide a tailored regulatory analysis of their 0.64 acre property to facilitate the development of a housing project under Senate Bill 4. The church's existing sanctuary is too large for their congregation’s current needs and they are looking to downsize their facility. They would like to give back to the community by developing the underutilized portions of their property as housing.

On March 7, 2025, AHA and City staff met with representatives of the All Saints Episcopal Church to provide a tailored regulatory analysis of their 1 acre property to facilitate the development of a housing project under Senate Bill 4. The church currently operates a day school in Monterey County and has considered building housing for its teachers, as well as other local workers, on a portion of its property.

On April 1, 2025, AHA and City staff met with representatives of the Church of the Wayfarer to provide a tailored regulatory analysis of their 0.37-acre property. This religious institution is located in the Residential and Limited Commercial (RC) District and is permitted a density of up to a total of 88 du/ac, inclusive of all state and local bonuses . The church is located in the same zoning district as Trevvett Court, a low-income senior housing project with a density of 76 dwelling units per acre. The church is considering both adaptive reuse of existing buildings and demolition and reconstruction of portions of its site. AHA and City staff have continued to meet and communicate with the Church of the Wayfarer since their initial April meeting. In a subsequent meeting, it was discovered that the original master plan for the church included a two-story building that was never constructed. Based on conversations with the property owner, the additional development potential available on-site, and the past trends by zoning district and built density (e.g. Trevvett Court), the site can realistically achieve its permitted density.

Appendix C – Sites Inventory C-18
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 To assist the churches in understanding their potential for development, the City conducted a preliminary site analysis for each church property. Churches may choose to pursue any of these options, other related options, or any combination thereof:
▪ Multi-family housing
▪ Transitional housing
▪ Supportive housing
▪ Single-room occupancy housing
To qualify for SB 4, 100 percent of the units must be affordable and deed-restricted for 55 years. Up to 20 percent of the units may be rented to moderate-income households, and up to 5 percent (per state law) may be occupied by church staff. Discussions with individual churches yielded confirmation of their intention to develop housing for lower income households.

Capacity Calculation
Two of the three church properties, which are currently zoned R-1 (All Saints and First Church of Christ, Scientist), will pursue affordable housing through an SB 4 application. For residentially zoned properties, SB 4 allows the church properties to develop housing at the State-established default density for lower income housing (20 units per acre for Carmel), without the need to rezone or amend the General Plan. The third church property (Church of the Wayfarer) is zoned RC, which allows affordable housing development up to 88 du/ac. The City has been in communication with the three churches and anticipates preliminary applications from All Saints and First Church of Christ, Scientist by the end of November 2025. The City estimates capacity based on gross density (under SB 4 for All Saints and First Church of Christ, Scientist and based on RC zoning for Church of the Wayfarer), allowing a flexible approach to accommodating housing. The churches could pursue a combination of infilling and adaptive reuse to maximize the number of units on site. Below are descriptions of the existing structures on church properties based on discussions with the churches and local knowledge.

These descriptions demonstrate how additional units can be achieved on site through a combination of adaptive reuse and new construction.

All Saints’ Episcopal Church. This church property consists of several attached and detached oneand two-story buildings with pitched roofs in a loose courtyard formation on a 1.01-acre irregular, steeply sloped site, which is the equivalent of around 11 standard Carmel lots, or 44,000 sf, in the R-1 district. The current building footprints occupy nearly one-third, or about 13,000 sf, of the site, and much of their interiors contain underutilized office, classroom, and accessory spaces. Landscaping and five parking spaces occupy the remainder of the site. Because church service parking cannot be accommodated on site, the congregation is considering eliminating some or all existing parking spaces and sponsoring a ride-share service instead. The congregation is considering both adaptive-reuse and new-construction design options and could accommodate 20 du/acre with either or both strategies.

First Church of Christ, Scientist. This church property consists of three semi- or fully-detached buildings of one and two stories, arrayed back-to-back but offset along two streets on a 0.63-acre site– the equivalent of around seven standard Carmel lots, or 28,000 sf, in the R-1 district. The current

Appendix C – Sites Inventory C-19
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 building footprints occupy approximately one quarter or 7,000 sf of the site, and consist of a freestanding “Reading Room,” a large Sunday school facility that is underutilized, and a large sanctuary that is now well over-sized for accommodating service attendance. About seventeen parking spaces occupy the remainder of the site. The congregation is considering substantially down-sizing their sanctuary, adaptively re-using other spaces, and adding new construction on their underutilized surface parking lots, which would accommodate 20 du/acre in multiple configurations.

Church of the Wayfarer. This church property consists of an L-shaped, two-story building with a pitched-roof attic space on a 0.37-acre rectangular sloped site, which is the equivalent of around four standard Carmel lots, or 16,000 square feet, in the RC district. The current building footprint occupies approximately two thirds, or 12,000 square feet, of the site, and much of its interior contains underutilized classroom and accessory spaces. There is no on-site parking and landscaping currently occupies the remainder of the site. The original church plans, which are still to be fully realized, include another wing that would transform the L-shape to a U-shape courtyard plan. The congregation is considering both adaptive-reuse and new-construction design options, yet could accommodate 88 du/acre within the envelope of the existing structure depending on unit types.

While this property is smaller than 0.5 acre, the City has experience developing 100 percent affordable housing on small properties (e.g., Trevvett Court at 0.18 acre). Regionally, similar communities have also successfully achieved affordable housing on small sites (see Table C-10, Affordable Housing Projects on Small Sites). The Church of the Wayfarer site is in fact larger than the sites identified in Table C-10.

Zoning, Infrastructure, and Environmental Constraints
Two of the church properties are currently zoned R-1 and one is zoned RC. All three churches have stated their intention to submit (or have submitted) preliminary applications to pursue affordable housing development on site. All Saints and First Church of Christ, Scientist will be pursuing affordable housing using SB 4 provisions. Church of the Wayfarer will be pursuing affordable housing as permitted by the RC zoning.

These church properties are developed with existing structures and paved parking on much of the property space. They are currently served with infrastructure and utilities. There are no known environmental conditions or impacts that would significantly constrain or preclude residential development on these sites.

Appendix C – Sites Inventory C-20
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-10 Affordable Housing Potential on Church Properties Site
No.*
Church
Address
APNs Site
Size
General Plan Land
Use
Zoning Allowable
Density
Height Estimated
Capacity
(Excluding
Density
Bonus)
Income
C-1 All Saints’ Episcopal
SWC Dolores Street &
9th Avenue
010-157-012
010-157-013

1.01 Single Family
Residential
Single
Family
Residential
(R-1)
20 du/ac 2-Story
24 feet
20 20 Lower Income
C-2 First Church of Christ,
Scientist
Monte Verde 2 NE of 6th
Avenue
010-212-004
010-212-021
010-212-026
010-212-027
010-212-028
010-212-029
010-212-030

0.63 Single Family
Residential
Single
Family
Residential
(R-1)
20 du/ac 2-Story
24 feet
13 13 Lower Income
C-3 Church of the Wayfarer
NWC Lincoln & 7th
Avenue
010-191-002 0.37 Residential/Commercial Residential
and Limited
Commercial
(RC)
88 du/ac 2-Story
26 feet
32 32 Lower Income
Total 2.01 65 65 Lower Income
(6 ELI/29 VL/30
L)
*None of these sites were utilized in the 5th cycle Housing Element sites inventory.

Appendix C – Sites Inventory C-21
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Downtown Carmel
Characteristics and Underutilization
Affordable Housing on Small Lots
State law assumes sites 0.5 acres or larger are feasible for the development of affordable housing for lower income households, but Carmel, by virtue of its original development pattern, is primarily composed of small 4,000-square-foot lots. Indeed, while Carmel has only one parcel larger than 0.5 acre when hotel and cultural/recreational sites are excluded, downtown Carmel has a large number of 8,000- square-foot lots (0.18 acre), which have been formed over the years through the merging of two 4,000- square-foot lots. As illustrated in Table C-11, excluding hotels, existing multifamily housing, and cultural and recreational facilities, downtown Carmel has 36 lots of approximately 8,000 square feet in size.

Table C-11 Distribution of Lot Sizes
Lot Size # of Parcels
<4,000 sf 120
4,001 to 7,999 sf 50
8,000 to 8,700 sf 36
10,000 to 12,000 sf 4
12,001 to 16,000 sf 3
>21,780 sf (0.5 acre) 1
Carmel, along with many similar communities, has successfully produced affordable housing on sites smaller than 0.5 acre. In exploring the feasibility of building affordable housing on small lots, the City has reviewed numerous Housing Elements of:
▪ Small communities of similar size as Carmel; and
▪ Coastal communities with similar market conditions and characteristics.

This search yielded many examples of affordable housing projects on sites smaller than 0.5 acre.

However, in citing these examples in the Carmel Housing Element, the City only considered projects that are:
▪ Recent projects (within five years) that demonstrate recent development trends; ▪ Projects that received credit toward the 6th cycle RHNA for the respective jurisdictions; and
▪ Projects on small sites that approximate typical Carmel parcel sizes.

As shown in Table C-12, affordable housing has been either built, entitled, or is otherwise in the approval pipeline on numerous small sites in the region. For those projects that most closely approximate Carmel lot sizes, an average of 32 percent of the units are affordable. The density range of these projects span a wide spectrum, from fairly low density (15 units per acre) to higher high densities at about 100 units per acre.

Appendix C – Sites Inventory C-22
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-12 Affordable Housing Projects on Small Sites
City Project
Site Size
(Acres)
Estimated
Density
Very
Low/
Low Moderate
Above
Moderate
% Lower
Income
Monterey 480 Cannery Row 0.15 340 11 0 40 28%
Monterey 449 Alvarado St 0.30 90 7 0 27 21%
Santa Cruz 2120 Mission St 0.22 64 3 0 11 21%
Santa Barbara 21 E. Anapamu 0.10 120 12 0 0 100%
Santa Barbara 116 E. Cota 0.25 116 28 0 1 97%
Pacific Grove 301 Grand Ave 0.17 65 3 0 8 27%
St. Helena 963 Hope St 0.19 26 4 1 0 80%
Ojai 408-410 Montgomery St 0.20 15 3 0 0 100%
Like these other communities in the table above, Carmel has successfully produced affordable housing on small sites. The most recent such project, a 14-unit affordable development called “Trevvett Court,” was built in 2010 on an 8,000-square-foot lot at a density of 76 units per acre and an FAR of 1.09 (see Figure C-1). The project is owned and managed by The Carmel Foundation and was developed without any public funding.

Figure C-1 Trevvett Court
Currently in Carmel only projects that are 100 percent affordable qualify for the enhanced density of 88 units per acre, while the maximum density on mixed-income projects is 44 units per acre. This represents an impediment to the production of affordable housing within the City. To address this, the City will be amending the Municipal Code to offer this same increased density to mixed-income

Appendix C – Sites Inventory C-23
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 projects (tentatively, those in which at least 30 percent of the units are affordable). See the description of the Mixed-Income Incentive Program in Chapter 2.

Methodology for Identifying Underutilized Properties Downtown Downtown Safari
To identify properties with the potential to generate new housing units via adaptive reuse/conversion or redevelopment, AHA mobilized its members to conduct site visits on every property in downtown Carmel. These site visits, which came to be known as “safaris,” were a highly organized, months-long, boots-on-the-ground undertaking in which 17 volunteers canvassed the entire commercial district of the City. Utilizing a mobile app, these AHA volunteers catalogued 218 properties and nearly 1,000 leasable spaces, collecting data for each site (e.g., current use, occupancy, and property condition).

When coupled with datasets from the City, the County, and from subscription-based commercial real estate data firms such as Reonomy, this data provided the City with an unprecedented level of precision and granularity in its effort to identify sites with housing development potential.

Objective Criteria for Identifying Underutilized Properties The City used a number of characteristics to identify properties with redevelopment and adaptive reuse potential. These include:
▪ Owner Interest: The expressed interest of property owners in pursuing residential uses indicates that the current uses on the site are not so valuable to the owner that it would hinder potential redevelopment or adaptive reuse for residential purposes—an important factor in considering a non-vacant site for inclusion in the Sites Inventory. ▪ Utilization: 10 percent or more of total leasable spaces are vacant, or 20 percent or more of total leasable spaces are vacant or under-utilized (e.g., used as storage, reduced hours, by appointment only).
▪ Age of Structure: Buildings older than 35 years (built prior to 1990) typically require major system upgrades and are not ADA-compliant. Retrofitting existing structures to meet current ADA standards is usually cost prohibitive or even physically infeasible. Buildings that face such financial or physical constraints rarely receive significant investment for modernization or systems upgrades, rendering the buildings progressively unsuitable for current trends.
▪ Condition of Structure: AHA members used a rubric derived from the Uniform Appraisal Dataset (UAD) “Appraisal Condition Rating” standardized scale to conduct a visual survey of the physical condition of every commercial property in downtown Carmel. The scale ranges from a score of “C1” to “C6”, with C6 representing properties in the worst condition. Structures rated C4, C5, and C6 are considered to have some level of impairment to their condition that makes them a more viable candidate for redevelopment:

Appendix C – Sites Inventory C-24
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 ▪ C4 (Maintained, But Requires Minor Repairs) - The property improvements show slight deferred maintenance and minor physical decline from regular wear and tear. The structure has been fairly well-kept but needs cosmetic and/or minor repairs. ▪ C5 (Functional, But Requires Repairs or Rehabilitation) – The property has not been adequately maintained but is functional. Does not have any significant safety concerns. The structure shows noticeable deferred maintenance and needs substantial repairs. While the functional utility and overall livability are somewhat diminished, the structure remains usable and functional as a residential dwelling. ▪ C6 (Poorly Maintained with Significant Damage) – The property has been poorly maintained. The improvements suffer from significant damage or deferred maintenance, with defects severe enough to impact safety, soundness, or structural integrity. Substantial repairs and rehab are required, encompassing many or most major building components.
▪ FAR: Existing FAR is less than or equal to 50 percent of allowable FAR, indicating a substantial potential for increasing leasable space.2
▪ Improvement to Land Value Ratio: An improvement to land value ratio of less than 1.0, indicating the value of the improvements (structures) is less than the value of land.

Communities often use similar factors in identifying nonvacant sites with potential for redevelopment.

As illustrated in Table C-13, the factors used by Carmel are similar to those used by other communities in the coastal region.

Table C-13 Regional Redevelopment Trends
Carmel Capitola Santa Barbara Seaside
Vacancy >10% – – –
Building Conditions Requiring repairs to
significant damage
– – –
Age of Structure 35+ Years – – 30+ Years
FAR <=50% <=50% – <= 30%
Improvement to Land Value
Ratio
<1.0 <1.0 <2.01 <0.5
After applying the factors outlined above, the City categorized viable sites as either a prospect for the City’s new Live/Work Program or for the City’s new Mixed-Income Incentive Program (See program descriptions in Chapter 2).

In evaluating the feasibility of adding residential uses (either through redevelopment or adaptive reuse), the City followed the rules described below:
2 For properties where an FAR calculation was unavailable, we created a Building Height Index as a proxy for FAR. The Building Height Index is a weighted average that takes the percentage of the site that is 0 stories and assigns a value of 0; the percentage of the site that is 1 story and assigns a value of 1, and the percentage of the site that is 2 stories and assigns a value of 2. Thus, a site with 100% lot coverage with a single-story building would have a Building Height Index of 1.0. A site with 100% lot coverage with a two story building would have a Building Height Index of 2.0.

Appendix C – Sites Inventory C-25
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 ▪ Live/Work Sites – The City anticipates that live/work units will primarily be created through the conversion of existing commercial square footage. As such, among the factors discussed above, FAR is not relevant because the City’s methodology for projecting the potential unit yield does not assume increasing building square footage. Therefore, for sites tagged as Live/Work sites, a site meeting three of the four factors would qualify a property as a viable site.
▪ MIIP Sites (Redevelopment) – In contrast to live/work sites, for redevelopment projects, the ability for the developer to substantially increase the building square footage or height is an important consideration. Therefore, FAR is included as one of the factors for consideration for sites tagged as Mixed-Income Incentive Program sites. For these MIIP sites, meeting three of the five factors would qualify a property as a viable site.

Downtown Live/Work Units
Assumptions and Analysis Based on Existing Uses
In cataloguing leasable spaces downtown, the resident volunteers on the safari teams identified 266 offstreet, upper story, or peripherally located storefronts that were either vacant or under-utilized. The lack of demand for this off-street space translates into surprisingly low rents. The market for commercial space in downtown Carmel has two tiers: the spaces with frontage on main streets, such as Ocean Avenue, which command eye-popping rents (often in excess of $7.00 per square foot NNN), and these less desirable off-street spaces, which have surprisingly low rents (typically $1.50 to $2.00 per square foot NNN). (See Figure C-2 for illustrations of underutilized commercial spaces in the commercial district.) Carmel does not currently allow a live/work use – i.e., a dual purpose space where someone lives and operates a business in the same unit – but if it did, the commercial rents for these off-street commercial spaces are so low, that in most cases, a property owner could actually command a higher rent by renting these spaces as deed-restricted affordable live/work units than as strictly commercial space.

As an example, consider a 350-square-foot off-street or upper story commercial space. As a purely commercial use, that space would rent for $1.50 to $2.00 per square foot. For the purposes of this illustration, let us assume the more conservative $2.00 per square foot figure, which equates to $700 per month. By contrast, if that same space were converted into a live/work space and deed restricted at a rental rate affordable to a low-income household, the property owner could charge approximately $1,800 per month, or 157% more. Even if the space were converted into a live/work unit affordable to a very low-income household, the property owner would still be able to charge a meaningfully higher rent–$1,040 vs. $700. The conclusion is striking: a property owner could make more money renting a small, impaired commercial space in downtown Carmel as an affordable live/work unit than as a strictly commercial space. Table C-14 extends this analysis to commercial spaces of various sizes, demonstrating the overall economic viability of the proposed program.

Appendix C – Sites Inventory C-26
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Figure C-2 Examples of Underutilized Commercial Spaces
Table C-14 Rent Comparison: Residential vs Commercial
Downtown Carmel-by-the-Sea
Live / Work Feasibility Analysis
1 Person Household
250 sf 350 sf 450 sf 550 sf
Moderate Income
Max affordable live/work rent (net of Utility Allowance) $1,970 $1,970 $1,949 $1,949 Current market rate commercial rent @ $2/sf $500 $700 $900 $1,100 Low Income
Max affordable live/work rent (net of Utility Allowance) $1,800 $1,800 $1,779 $1,779 Current market rate commercial rent @ $2/sf $500 $700 $900 $1,100 Very Low Income
Max affordable live/work rent (net of Utility Allowance) $1,040 $1,040 $1,019 $1,019 Current market rate commercial rent @ $2/sf $500 $700 $900 $1,100 To be clear, the Live/Work Program does not propose the discontinuance of all existing uses, only allowing vacant and/or underutilized spaces to be renovated/converted in such a way that a new use (residential) can be added to enhance the financial viability of the overall properties. The buildings identified for conversion have high vacancies and underutilization rates. There are no known long-term leases that would preclude owner improvements to the spaces.

Appendix C – Sites Inventory C-27
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Live/Work Case Study
Downtown Carmel has a number of examples of an unusual building type, typically two-stories, that contains multiple, compact, commercial spaces arrayed along a narrow passageway or courtyard off the main pedestrian sidewalk. In an effort to explore the physical feasibility of live/work units within this unusual configuration, local architects familiar with the City’s development regulations volunteered to conduct conversion exercises. They were asked to pursue three goals for solutions that would: 1) apply widely to different variations of this building type, 2) maintain the compact floor areas of their original commercial spaces in order to reinforce rent affordability, and 3) take advantage of existing commercial entrances in order to keep improvement costs low and comparable to typical commercial tenant improvements. Figure C-3 shows a case study on a 4,000 square-foot lot in the Central Commercial (CC) zone. Using the original commercial units and their original entrances, the architects demonstrated how the building yields eight off-street live/work units, between 350 to 430 square feet in size, while keeping the on-street commercial space intact. This adaptive-reuse approach maximizes the dwelling unit yield of this building and demonstrates how other similar buildings can do the same.

Appendix C – Sites Inventory C-28
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Figure C-3 Live/Work Adaptive Re-Use Case Study

Appendix C – Sites Inventory C-29
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-15 Properties with Live/Work Potential for Lower-Income Housing Site No.

APN Property Name GP/ Zoning
General Plan Land
Use
Property
Owner
Interest Condition
Year
Built
Improvement
to Land
Value Ratio
Potential
Live/
Work
Spaces
Conversion
Rate
Applied
Total
Potential
Units
L-1
010-135-026
Serena Court Central
Commercial (CC)
Core Commercial Yes C4 1972 0.69 7 100% 7
L-2
010-146-017
Doud Arcade Central
Commercial (CC)
Core Commercial Yes C5 1930 2.02 12 100% 12
L-3
010-131-027
Villa Carmel
mixed use
Residential &
Limited
Commercial (RC)
Residential/Commercial Yes C4 1987 0.66 13 100% 13
L-4
010-135-028
Eastwood Building Service
Commercial (SC)
Core Commercial Yes C4 1972 0.69 8 100% 8
L-5
010-138-010
El Prado de Su
Vecino
Service
Commercial (SC)
Core Commercial Yes C4 1968 1.07 10 100% 10
L-6
010-145-018
Stonehouse
Terrace
Service
Commercial (SC)
Core Commercial Yes C3 1978 5.49 12 100% 12
L-7
010-132-003
Tejido Building Central
Commercial (CC)
Core Commercial No C4 1973 1.26 10 75% 8
L-8
010-132-016
Ivy Courtyard Central
Commercial
Core Commercial No C4 1976 0.50 10 75% 8
Totals 82 78
(8 ELI/ 31 VL/ 39 L)
*None of these sites were utilized in the 5th cycle Housing Element sites inventory.

Appendix C – Sites Inventory C-30
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Capacity During 6th Cycle Planning Period
Overall, the safari efforts identified 259 potential live/work spaces in downtown Carmel – i.e., vacant or under-utilized off-street or upper story commercial spaces. The City believes that all of these spaces are potential candidates for live/work conversion; however, the City and AHA have conservatively identified eight properties with a higher concentration of potential live/work spaces which have expressed t owner interest, to designate as potential live/work “sites” for RHNA credit. For these sites, due to strongly expressed owner interest, the City assumed that all of the potential live/work units would be converted. To be eligible for participation in this Live/Work Housing program, the converted units would be required to be deed restricted as housing affordable to lower income households (8 extremely low, 35 very low income, and 35 low income).

Zoning, Infrastructure, and Environmental Constraints
Properties identified for potential conversion from commercial/retail spaces into live/work units are all located on commercially zoned properties where residential uses are permitted. No direct zoning constraints are identified. However, in an effort to make the development process easier, the City will amend the Zoning Code to specify that live/work housing is a permitted residential use.

Live/work units are expected to be created through adaptive reuse of existing vacant or underutilized commercial/retail spaces in Downtown Carmel. These are developed properties located in the City’s urban core, which is currently served with infrastructure and utilities. With little to no new construction activities associated with this program, the City does not anticipate any environmental conditions or impacts that would preclude or significantly constrain the adaptive reuse of existing properties to include residential uses.

Opportunities for the Mixed Income Incentive Program
Overall, the safari efforts identified 20 properties at least 8,000 square feet in size and appropriate for redevelopment/infill to provide housing units on site. These properties meet at least three of the factors used to determine suitability, and at 88 units per acre, these properties have a potential yield of 385 units. If following the Trevvett Court model (at 76 units per acre), these properties could accommodate 320 units.

However, this Housing Element conservatively includes only the two properties with expressed owner interest for redevelopment. These two properties have a combined capacity of 18 units at 40 units per acre (the maximum allowable density, excluding density bonus), with an income distribution of 2 very low income, 2 low income, 2 moderate income, and 12 above moderate income units (30 percent lower and moderate income).

Appendix C – Sites Inventory C-31
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Case Study Analysis
Trevvett Court (a recent 100% affordable housing site on an 8,000 square foot lot with 14 units – for a density of 76 du/acre) is a single-use senior residence. Both to test the feasibility of even higher densities on similar lots and the feasibility of introducing street-front commercial uses, which are mandatory in some downtown areas, local architects volunteered pro bono analytical services. They studied typical midblock and corner lots both with and without considering parking facilities, as newbuilds or re-use projects, and with an eye toward providing a mix of apartment sizes, including family units. Their research showed that within current allowable building envelopes, densities of up to 88 du/acre are possible throughout all downtown zones, even when including street-front commercial space (see Figures C-4, C-5, and C-6).

Zoning, Infrastructure, and Environmental Constraints
Properties identified for potential conversion from commercial/retail spaces into mixed income housing are all located in commercially zoned properties where residential uses are permitted. No zoning constraints are identified.

These are developed properties located in the City’s urban core, which is currently served with infrastructure and utilities. The City does not anticipate any environmental conditions or impacts that would preclude or significantly constrain the redevelopment of existing properties to residential uses.

Appendix C – Sites Inventory C-32
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Figure C-4 Mixed-Income Case Study - "Midblock"
Figure C-5 Mixed-Income Case Study - "Corner Site"

Appendix C – Sites Inventory C-33
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Figure C-6 Mixed-Income Case Study - "Adaptive Re-Use"

Appendix C – Sites Inventory C-34
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-16 Mixed-Income Incentive Program Sites
Site No.

APN/
Parcel Size
Property
Name Zoning
General
Plan Land
Use
Property
Owner
Interest
Utilization
(% Vacant
or Underutilized) ConditionYear
Built
Improvement
to Land Value
Ratio
FAR < / =
50% of
Allowable
Units @
40 du/ac
Income
Distribution
M-1
010-138-020
8,000 SF
Su Vecino
Court1
Central
Commercial
(CC)
Core
Commercial
Yes 0% C4 1963 0.55 No 7 1/1/1/4
M-2
010-142-001
8,000 SF
GBG
Building2
Service
Commercial
(SC)
Core
Commercial
Yes 0% C3 1975 0.51 Yes 5 1/1/1/2
Total 12
Note: 1/1/1/4 = 1 Very Low, 1 Low, 1 Moderate, 4 Above Moderate *None of these sites were utilized in the 5th cycle Housing Element sites inventory.

1. Su Vecino Court: The site contains a two-story commercial building with a mix of office uses on both floors. A total of ten commercial tenant spaces were identified, with seven appearing largely vacant or used for storage. The entries to the tenant spaces are off-street and inward-facing, fronting on a courtyard with limited to no visibility from the public way. A similar two-story building (Schultz) to the north, mirroring Su Vecino Court, is currently undergoing renovation to add an apartment to the second floor. Su Vecino Court has underground parking and is in a transition zone from Service Commercial (SC) to Single-Family Residential (R-1).

2. GBG Building: The site contains a two-story mixed-use building on one-half of the site and a parking lot on the other one-half. A retail clothing store occupies the first floor of the building with residential uses above. The owner has expressed interest in redeveloping the parking lot into apartments; however, the site lacks a sufficient water supply.

Appendix C – Sites Inventory C-35
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Additional Opportunities for Housing
In addition to the various opportunities presented in previous sections, the City also has a number of scattered sites where additional housing could be accommodated. These sites total 53 additional units, including 2 low-income and 51 above moderate-income units. Detailed descriptions of these sites are included in subsection C.6. While most of these sites were recycled from the previous Housing Element, none of these recycled sites are being used in the 6th cycle Housing Element to meet the lower income RHNA. Furthermore, many sites can be intensified with existing uses remaining by adding second story structures for residential uses.

Nonvacant Site Analysis Methodology
Government Code Section 65583.2(g)(2)
Existing Uses
Each site included in the Site Inventory has been selected by the City based on its perceived developability and/or expressed interest by a property owner. All zoning districts within the city allow residential uses.

Many sites included in the Sites Inventory are zoned commercial. This is, in part, a result of the City’s Municipal Code requirement that all newly constructed second-story floor area, including area in new buildings, remodeled buildings, and replacement, rebuilt or reconstructed buildings, be occupied by residential dwellings only and not used for any commercial purpose (CMC 17.14.050.F). Currently, the Commercial District has a number of vacant spaces in need of remodeling and building code updates.

Timing is ripe for redevelopment and/or second story additions to accommodate residential units, as remodels and repairs are currently being undertaken and are expected to continue.

These residential unit requirements have not been an impediment to development in the commercial district, and have successfully resulted in two-story structures that support residential development on the second floor and commercial on the ground floor. The City has not received applications or requests for single-story developments in the commercial district. This is in part due to land value and the cost of construction, which does not support the development of single-story commercial buildings in Carmel-by-the-Sea. The City’s effort to support mixed-use development has been a strategy to encourage the development of housing, despite its built-out nature. Many commercial property owners have expressed interest in converting underutilized second floor office space to residential use or constructing a second story to accommodate residential units. To this end, there are several programs in Chapter 2 that seek to take advantage of this emerging opportunity by leveraging the in-depth analytical data collected by the AHA safari efforts including Programs 1.1.C (Live/Work Housing), 1.1.D (Mixed Income Incentive), and 1.1.E (Affordable Housing on Religious Facility Properties).

A goal in selecting sites has been to minimize displacement. For many sites, the expectation that housing will be developed in the future is based on receipt of property owner interest in adding a second story to existing commercial structures to develop residential units. Conversion of overnight

Appendix C – Sites Inventory C-36
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 visitor serving units either through redeveloped housing sites (Program 1.1.F: Hotel to Residential Development) or construction of on-site employee housing (Program 1.1.G: Employee Housing) is another viable strategy that the City is employing to develop residential units due to actual interest. In addition, the conversion of downtown office space and parking lots appears to have a strong possibility of yielding residential units (Program 2.1.A: Incentives for Mixed Use Development and Program

2.3.A: Preserve and Increase Upper Floor Residential Use).

While the City does not anticipate the displacement of low- or very low-income households, the City is prepared to comply with the requirements of Government Code section 65915, subdivision (c)(3).

Program 2.1.C in Chapter 2 will be in effect to require replacement housing units subject to the requirements of the Government Code. Additionally, CMC 17.14.050.A prohibits the conversion or demolition of an existing residential unit unless replacement housing is provided subject to the findings in 17.64.070.

Development Trends
Historically, residential development in Carmel-by-the-Sea has been most feasible using densities ranging between 22-33 dwelling units per acre. Development trends in the City reveal successful residential development in the commercial district primarily through office conversion and secondstory additions for residential units. In the last 10 years, the City has not had any one-story developments in the commercial districts. All new construction in the commercial districts has consisted of two-story buildings with second-floor residential use (as required in CMC Section

17.14.050.F).

This has been a successful strategy utilized by the City to enable the development of residential units within the constraints of limited developable land. The following projects are examples of 5th cycle residential development in Carmel-by-the-Sea, which have been considered in determining the realistic capacity of sites identified in the Site Inventory.

Some of the most recent mixed-use development projects include:

Great Valley Holdings/Clark Apartments: In 2020, the Planning Commission approved the construction of a new two-story mixed-use building. The 3,600-square-foot site contained a 2,200- square-foot two-story commercial building with surface parking. The project consisted of demolishing the existing building and constructing a new 3,500-square-foot two-story mixed-use building for a ground-floor restaurant and two second-floor rental apartment units. The building was previously occupied on both floors by a restaurant and had been vacant for a few years. The project density is 25 dwelling units per acre.

This project is an example of redeveloping an underutilized site with a new two-story mixed-use building in the Service Commercial (SC) District. No appeals of the project were filed. The project has been constructed and received final occupancy.

Schultz: In 2020 the Community Planning & Building Director approved an interior and exterior remodel of a commercial space in a 4,500-square-foot multi-tenant two-story mixed-use building in the

Appendix C – Sites Inventory C-37
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Service Commercial (SC) District for the conversion of second-floor commercial space to a 1,160- square-foot apartment. The property is 4,000 square feet (0.09 acres). The residential density on this mixed-use parcel is 22 du/acre.

Parashis: In 2020 the Community Planning & Building Director approved minor exterior alterations to a 6,700-square-foot two-story commercial building in the Central Commercial (CC) District to facilitate the conversion of second-floor office space to a 2,118-square-foot apartment. The property is 6,400 square feet (0.15 acres). The residential density on this mixed-use parcel is 7 du/acre. Other past mixeduse development projects are shown in Table C-17.

Table C-17 Past Mixed-Use Development Projects
Project Name Year Approved Zoning District
Lot Size
(square feet)
Residential
Spaces Units Per Acre
Del Dono 2016 Service Commercial (SC) 8,000 8 44
Fink
Condominium
2017 Central Commercial (CC) 4,000 1 11
Lincoln Lane 2018 Service Commercial (SC) 8,000 2 11
Marliz Estate 2018 Central Commercial (CC) 2,750 1 17
Brigantino 2018 Residential & Limited
Commercial (RC)
3,500 2 25
MDC Real Estate 2018 Central Commercial (CC) 4,000 1 11 Brosche Building 2019 Central Commercial (CC) 3,470 2 28 Flint-Herman
Residence
2019 Residential & Limited
Commercial (RC)
3,500 1 25
Der Ling Building 2019 Central Commercial (CC) 3,000 1 16 While many of the projects listed above were approved for densities between 22-33 dwelling units per acre, some were approved at 44 dwelling units per acre (Del Dono I and Del Dono II) and a few were approved below 20 dwelling units per acre (Fink Condominium; Lincoln Lane; MDC Real Estate; Marliz Estate; Der Ling Building; and Parashis). Additionally, all but one of the projects listed above are less than 0.5 acres. These factors were taken into consideration when determining appropriate densities to apply to the Sites Inventory, and supports the City’s decision to amend the base zoning for the commercial zoning districts (SC, RC, and CC) and the multi-family residential district (R-4) to establish a minimum density of 33 dwelling units per acre. The intention of this zoning code amendment is to facilitate the development of residential units at a higher yield, rather than enabling the development of larger units at a lower yield.

Considerations for Capacity Analysis
Dry Utilities and Water Capacity
Current or planned availability and accessibility of sufficient water, sewer, and dry utilities has also been considered for each site. All sites have sufficient dry utilities. Program 1.2.A has been included to grant priority water and sewer services to proposed developments that include units affordable to lowerincome households.

Appendix C – Sites Inventory C-38
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 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 from the Pure Water Monterey/Groundwater Replenishment Project, an advanced water recycling project jointly developed by MPWMD and Monterey One Water. MPWMD anticipates that this water will be available for use by the fourth quarter 2025.

In accordance with the City’s water management program (Carmel Municipal Code Chapter 17.50), the City Council must establish a list of defined land use or project categories for which water will be made available and the quantity of water to be allotted for each category. At least 10 percent of available water resources must be reserved for projects that will create new affordable housing units for very low, low, or moderate income units. 10 percent of 14 acre feet is 1.4 acre feet of water which could serve approximately twenty (20) 1-2 bedroom/1 bath apartments. The Carmel City Council will consider establishing land use categories and the quantity of water to be allotted for each category in the Fall of 2025 (see Chapter 2).

Site Typology
Government Code Section 65583.2 (c)
This housing plan and Site Inventory provides capacity for a variety of housing types; including multifamily rental housing, factory-built housing, mobile homes, housing for agricultural employees, supportive housing, single-room occupancy units, emergency shelters, and transitional housing. The Zoning Ordinance and General Plan for the sites allow the housing types listed above. Figure C-2 illustrates the anticipated housing development types included in this site inventory.

To enable the development of a variety of housing types, the City has expanded possible options for property owners to construct, rehabilitate, convert, or add to an existing single-story structure including:
▪ Zoning changes included with Program 1.1.F in Chapter 2 that incentivize existing overnight visitor accommodation sites to be converted into multi-family housing units; and ▪ Zoning changes with Program 1.1.G in Chapter 2 that incentivize the construction of employee housing units at overnight visitor accommodation sites; and ▪ Zoning changes with Program 1.1.C in Chapter 2 that incentivize the development of “Live/Work” units in vacant and underutilized commercial spaces.

Adequate Infrastructure Capacity
Government Code Section 65583.2 (b)(5)
Sewer
The Carmel Area Wastewater District (CAWD) serves the wastewater treatment needs for Carmel-bythe-Sea. The District completed a rehabilitation project at the wastewater treatment plant to renew existing infrastructure that was originally installed in the 1970s and 1980s. The wastewater treatment plant has a permitted capacity of 3.0 million gallons per day (MGD).

Appendix C – Sites Inventory C-39
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 The CAWD uses a wastewater generation rate of 100 gallons per day (GPD) per residential unit. Based on this rate, the City’s RHNA of 349 residential units is projected to generate 40,000 GPD of wastewater. The wastewater treatment plant currently has the capacity and ability to take on the City’s RHNA (Barbara Buikema, General Manager, September 13, 2023).

Water
Carmel-by-the Sea receives its water from the California-American Water Company (Cal-Am) Central Division who pumps its water from several local water sources: groundwater from the Carmel River Aquifer, Seaside Groundwater Basin, Aquifer Storage and Recovery, indirect portable reuse from Pure Water Monterey, and desalinated water from Sand City. The majority of water received in the City is from the Carmel River and the Seaside Groundwater Basin (City of Carmel-by-the-Sea 2023b).

Cal-Am’s Final Urban Water Management Plan (UWMP) (June 2021) provides several tables illustrating normal, single- and five consecutive-dry year water supply and demands to determine the total available supply. The supply from the Carmel River Aquifer, Seaside Groundwater Basin, Sand City Desalination Plant, and Monterey Peninsula Water Supply Project (MPWSP) Desalination Plant (anticipated to be operational by 2030) are all anticipated to be reliable and provide their contractual or design supply in all year types.

Until the MPWSP Desalination Plant is online, it is expected that demands will need to be constrained through the enactment of the Water Shortage Contingency Plan (California-American Water Company 2021, p. E-4). As described in the UWMP, the Water Shortage Contingency Plan is used to provide guidance to the Monterey County District’s governing body, staff, and the public by identifying response actions to allow for efficient management of any water shortage with predictability and accountability. It provides the tools to maintain reliable supplies and reduce the impacts of supply interruptions due to extended drought or catastrophic supply interruptions.

The water demand for the UWMP was calculated based on regional population growth projections available prior to the release of AMBAG’s current RHNA. The RHNA would result in more residential units within Cal-Am’s service area than what was considered in the UWMP. According to the Monterey Peninsula Water Management District’s (MPWMD) Technical Memorandum dated June 1, 2023, the City requires 40 acre feet of water to accommodate its RHNA of 349 units. When including the 17 percent buffer in the Housing Element Update approximately 46 acre-feet of water would be needed to meet the needs of the City’s RHNA (i.e., total of 410 housing units).

On January 27, 2025, MPWMD adopted Ordinance 197 allocating 14 acre feet of water from the Pure Water Monterey Expansion project to the City of Carmel-by-the-Sea. The District anticipates that the additional water supply will be on-line by the fourth quarter of 2025.

Many of the housing sites are developed with existing businesses or residences that currently use water.

It would be speculative at this time to document the existing water use at each site and whether adaptive reuse or redevelopment of those sites would result in the need for more or less water supply.

Appendix C – Sites Inventory C-40
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Therefore, as development applications are received for the housing sites, City staff will evaluate the applications to determine if additional water supply is required, and if it is available to the project.

The City of Carmel Regional Housing Needs Allocation (RHNA) is for 231 units of moderate, low-, or very low-income housing (out of a total 349 units). Section 17.50.040.A of the City Municipal Code states that projects involving no net increase in water use or that will create new housing affordable to moderate, low-or very low-income households may be accepted and processed without regard to water allocations.

Adjustment Factors for Realistic Capacity
Government Code Section 65583.2(c)(2)
Land use controls and site improvement requirements have been analyzed for constraints within Appendix B – Housing Constraints, and necessary changes to the review process are included as programs within Chapter 2 – Goals, Policies and Programs. Additionally, the City will amend the Municipal Code base zoning for the commercial zoning districts (SC, RC, and CC) and the multifamily residential (R-4) zoning district to establish a minimum density of 22 dwelling units per acre and a maximum allowable density of 40 units per acre, with a total capacity of 88 units per acre inclusive of local and State density bonuses, to increase the potential yield of residential units. The realistic development capacity for the sites begins with assuming those process changes to be in place by or prior to July 2025. Generally, the following adjustment factors have been considered for determining realistic capacity of the sites.
▪ Site geometry and on-site improvements
▪ Age of structures and building conditions
▪ Vacancy and under-utilization
▪ Improvement-to-land value ratio
▪ FAR
The table below identifies additional opportunities for residential development. While the City has previously demonstrated that small sites are typically developed at the maximum allowable density and can be feasible to facilitate affordable housing development, the City does not rely on these small sites below to meet its lower income RHNA. Development capacity on these sites is conservatively estimated at 33 units per acre, not at the proposed change to 40 units per acre.

Appendix C – Sites Inventory C-41
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-18 Additional Scattered Sites
Site
#
Location
(Reference to ECONW Study)
APN Zoning General Plan
Land Use
Acreage Applied
Density
(DU/AC)
Minimum
Capacity
Very
Low
Low Moderate Above
Moderate
Primary Underutilized Sites
S-1 Forest Cottages Specific Plan
NE Corner of Ocean & Mountain View
010085004000 Single Family
Residential (R-1)
Single Family
Residential

0.30 20 6 -- 2 -- 4
010085005000
010085003000
Subtotal Primary Underutilized Sites 0.30 6 0 2 0 4
Sites Recycled from 5th Cycle
S-2 Court of the Fountains
NW Corner Mission & 7th
010141003000 Central
Commercial (CC)
Core
Commercial

0.37 33 12 -- -- -- 12
S-3 Deleted
S-4 Office building
NE Corner Monte Verde & 7th
010191004000 Residential &
Limited
Commercial (RC)
Residential/
Commercial

0.07 33 2 -- -- -- 2
S-5 Yafa
NW Corner Junipero & 5th
010097007000 Service
Commercial (SC)
Core
Commercial

0.18 33 5 -- -- -- 5
S-6 Deleted
S-7 Carmel Realty Office Site (#4)
NE Corner 8th & Dolores
010145008000 Residential &
Limited
Commercial (RC)
Residential/
Commercial

0.19 33 6 -- -- -- 6
S-8 (Parashis) Millard Building
NW Corner Dolores & 6th
010138006000 Central
Commercial (CC)
Core
Commercial

0.13 33 4 -- -- -- 4
S-9 The Agency
NW Corner Ocean & Dolores
010139001000 Central
Commercial (CC)
Core
Commercial

0.09 33 2 -- -- -- 2
S-10 Enzo's
San Carlos 2 SW of Ocean
010146001000 Central
Commercial (CC)
Core
Commercial

0.15 33 4 -- -- -- 4
S-11 Paseo San Carlos Square #1
San Carlos 2 NW of 7th Ave
010146003000 Central
Commercial (CC)
Core
Commercial

0.18 33 5 -- -- -- 5
S-12 Carmel Office Supply & Business Center
Lincoln SE of Ocean
010147010000 Central
Commercial (CC)
Core
Commercial

0.09 33 2 -- -- -- 2
Subtotal Recycled Sites 1.45 42 0 0 0 42
Total 1.75 48 0 2 0 46

Appendix C – Sites Inventory C-42
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site #S-1 Forest Cottages Specific Plan
The Forest Cottages site is approximately 0.30 acres and is located within a Specific Plan area. The Forest Cottages Specific Plan was adopted by the City Council in 2006 and amended in 2008. Existing uses on the site include a hotel/motel consisting of 3 rental units and 1 manager’s unit. The existing buildings were constructed in the 1920’s. Except for a reroof permit in 2024, there have been no permits issued for building upgrades in over 30 years. Based on data collected for the Hotel-toResidential Conversion program, the hotel currently operates below the market average. Based on the age of existing structures, lack of improvements, and lower hotel performance, the site is ripe for redevelopment.

The Specific Plan allows a total of 6 units, of which 4 are single-family residential units. It contains an affordable housing requirement of two multi-family residential units permanently dedicated and used to provide housing for low-income or very low-income households as defined by State statutes. The Specific Plan requires that a deed restriction be recorded establishing this requirement prior to issuance of the first building permit within the Specific Plan.

Developed at 20 dwelling units per acre, the site would allow a total of six units to accommodate two low-income units and four above-moderate income units (Table C-19). This density calculation does not account for adjustments, as the site is part of a Specific Plan that has approved densities, anticipated unit counts by income category, and existing site improvements. The Specific Plan affordable housing requirement discussed above satisfies the “interest” in developing affordable housing on the site.

Table C-19 Site #S-1 Forest Cottages Specific Plan: Site Description Site Description Site Image & Capacity Calculation
Address Northeast corner of Ocean and
Mountain View
APN 010-085-004-000
010-085-005-000
010-085-003-000
By-Right with 20%
Affordable
No, not used in the previous cycle
Size of Site 0.30 acre
Zoning R-1
Allowable Density 20 du/ac
RHNA Affordability Low-Income: 2 unit
Above Moderate-Income: 4 units
Existing Use Non-vacant; hotel/motel
Infrastructure
Availability
Yes, no constraints. Realistic Capacity = (0.30 X 20) = 6 units Specific Plan Approved Density
Environmental
Constraints
None known

Appendix C – Sites Inventory C-43
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site Description Site Image & Capacity Calculation
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Site #S-2 Court of the Fountains
The Court of the Fountains is approximately 0.37 acres. Existing uses include multi-tenant retail shops and a restaurant across multiple single-story commercial buildings. The site was included in the 5th Cycle inventory as a nonvacant site. The Court of the Fountains site has a building conditions rating of C3, which is generally well maintained with minimal wear. This is in the mid-range of the building conditions scale. The building was constructed in 1964 and is 62 years old. The existing floor area ratio is 0.46, and the current zoning allows up to 1.5. The improvement-to-land ratio is below 1.0 at 0.89.

This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Ground floor commercial uses could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 12 above moderate-income units.

When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 9 above moderate-income units (Tables C-20 and C21). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 du/acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Appendix C – Sites Inventory C-44
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-20 Site #S-2 Court of the Fountains: Site Description Site Description Site Image and Capacity Calculation
Address Northwest corner of Mission
Street and 7th Avenue
Realistic Capacity utilizing factors =
(0.37 X 38) (.90) (.95) (.95) = 9 units
75% of minimum density
APN 010-141-003-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles,
but nonvacant .

Not used to meet lower
income RHNA for 6th cycle.

Size of Site 0.37 acre
Zoning CC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income:
12 units
Existing Use Non-vacant
Infrastructure Availability Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-21 Site #S-2 Court of the Fountains: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea
Site #S-3 Removed

Appendix C – Sites Inventory C-45
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site #S-4 Office Building
The Office Building site is approximately 0.07 acres. The property is currently significantly underdeveloped. The one-store commercial building is occupied by a private foundation and used as professional office space. The site is in a transition zone from the Residential & Limited Commercial (RC) District to Single-Family Residential (R-1) District with a hotel to the north (that was originally constructed as apartments), an apartment complex to the south, and a duplex to the west. The site was included in the 5th Cycle inventory as a nonvacant site. The Office Building at Monte Verde & 7th has a building conditions rating of C4, which is maintained but requires minor repairs. This is in the lower tier of the building conditions rating. The building was constructed in 1935 and is 91 years old. The existing floor area ratio is 0.53, and the current zoning allows up to 0.95. The improvement-to-land ratio is below 1.0 at 0.49. This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. The office use could relocate during construction and return upon project completion. Ample vacant office space is available throughout the village.

The site is zoned Residential & Limited Commercial (RC), which allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 2 above moderate-income units.

When factoring in potential land use controls and site improvements, the site’s realistic capacity, and typical densities, the site’s net acreage would yield a total of 1 above moderate-income unit (Tables C-24 and C-25). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 du/acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Table C-22 Site #S-4 Office Building: Site Description
Site Description Site Image & Capacity Calculation
Address Northeast corner of Monte
Verde Street and 7th Avenue
Realistic Capacity utilizing factors =
(0.07 X 33) (.90) (.95) (.95) = 1 unit
50% of minimum density
APN 010-191-004-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles,
but nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.07 acre
Zoning RC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 2
units
Existing Use Non-vacant; office space

Appendix C – Sites Inventory C-46
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site Description Site Image & Capacity Calculation
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-23 Site #S-4 Office Building: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea
Site #S-5 Yafa
The Yafa Building is located on a corner lot totaling 0.18 acres. A restaurant currently occupies the existing single-story commercial building. The site was included in the 5th Cycle inventory as a nonvacant site. The Yafa site has a building conditions rating of C4, which is maintained but requires minor repairs. This is in the lower tier of the building conditions rating. The building was constructed in 1967 and is 59 years old. The existing floor area ratio is 0.52, and the current zoning allows up to 1.5.

The improvement-to-land ratio is below 1.0 at 0.72. This site meets all four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Ground floor commercial uses could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Service Commercial (SC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Appendix C – Sites Inventory C-47
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Developed at 33 du/acre, the gross acreage of the site would produce 5 above moderate-income units.

When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 4 above moderate-income units (Tables C-26 and C27). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 du/acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Table C-24 Site #S-5 Yafa: Site Description
Site Description Site Image & Capacity Calculation
Address Northwest corner of Junipero
and 5th Avenue
Realistic Capacity utilizing factors =
(0.18 X 33) (.90) (.95) (.95) = 4 units
80% of minimum density
APN 010-097-007-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles,
but nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.18 acre
Zoning SC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 5
units
Existing Use Non-vacant; commercial space
and parking lot
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Appendix C – Sites Inventory C-48
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-25 Site #S-5 Yafa: Capacity Assumptions
Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea
Site #S-6 Removed
Site #S-7 Carmel Realty Office
Carmel Realty Office is a 0.19-acre corner lot currently owned and used by Carmel Realty, a real estate agency, for office space. It is a single-story structure with low lot coverage, surrounded by two-story structures to the north and east. The site was included in the 5th Cycle inventory as a nonvacant site.

The Carmel Realty Office site has a building conditions rating of C3, which is generally well maintained with minimal wear. This is in the mid-range of the building conditions scale. The building was constructed in 1934 and is 92 years old. The existing floor area ratio is 0.43, and the current zoning allows up to 0.95. The improvement-to-land ratio is below 1.0 at 0.48. This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment.

The office use could relocate during construction and return upon project completion. Ample vacant office space is available throughout the village.

The site is zoned Residential and Limited Commercial (RC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 6 above moderate-income units.

When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 5 above moderate-income units (Tables C-30 and C31). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 dwelling units per acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Appendix C – Sites Inventory C-49
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-26 Site #S-7 Carmel Realty Office: Site Description Site Description Site Image & Capacity Calculation
Address Northeast corner of Dolores
Street and 8th Ave
Realistic Capacity utilizing factors =
(0.19 X 33) (.90) (.95) (.95) = 5 units
83% of minimum density
APN 010-145-008-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles, but
nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.19 acre
Zoning RC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 6
units
Existing Use Non-vacant; office space
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-27 Site #S-7 Carmel Realty Office: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea

Appendix C – Sites Inventory C-50
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site #S-8 Parashis/Millard Building
The Parashis/Millard Building is a 0.13-acre mixed-use parcel that includes one- and two-story buildings. Commercial uses primarily occupy the first floor, while professional offices historically occupied the second floor. The second floor has been undergoing a remodel for a few years. The property is now under new ownership and plans for the property include additional residential development. The Parashis/Millard Building site has a building conditions rating of C4, which is maintained but requires minor repairs. This is in the lower tier of the building conditions rating. The building was constructed in 1960 and is 66 years old. The existing floor area ratio is 1.08, and the current zoning allows up to 1.5. The improvement-to-land ratio is below 1.0 at 0.40. This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Additionally, with the recent availability of water, the property owner is actively pursuing the creation of additional residential units on this existing mixed-use site.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at a minimum of 33 du/acre, the gross acreage of the site would produce 4 above moderateincome units. When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 3 above moderate-income units (Tables C-32 and C-33). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 du/acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

City staff met with the new property owner in June 2022. They are interested in redeveloping the site with a new mixed-use building (similar to the MacDonald Gallery building one block west). As of August 2025, plans to add four apartments to the site are in design development.

Appendix C – Sites Inventory C-51
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-28 Site #S-8 Parashis/Millard Building: Site Description Site Description Site Image & Capacity Calculation
Address Northwest corner of Dolores
Street and 6th Ave
Realistic Capacity utilizing factors =
(0.13 X 33) (.90) (.95) (.95) = 3 units
75% of minimum density
APN 010-138-006-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles, but
nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.13 acre
Zoning CC
Allowable Density 0-22 du/ac**
Applied RHNA
Affordability
Above Moderate-Income: 4 units
Existing Use Non-vacant; commercial space
Infrastructure Availability Yes, no constraints.

Environmental Constraints None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-29 Site #S-8 Parashis/Millard Building: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and singlefamily and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea
Site #S-9 The Agency
The Agency is a single-story real estate office located on a 0.09-acre corner lot. It has low lot coverage and is surrounded by two-story structures to the west and by two-story structures across the street to the east. The site was included in the 5th Cycle inventory as a nonvacant site. The Agency site has a building conditions rating of C3, which is generally well maintained with minimal wear. This is in the mid-range of the building conditions scale. The building was constructed in 1945 and is 81 years old.

The existing floor area ratio is 0.68, and the current zoning allows up to 1.5. The improvement-to-land ratio is below 1.0 at 0.40. This site meets three of the four objective criteria previously discussed for

Appendix C – Sites Inventory C-52
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 selecting underutilized sites with potential for redevelopment. The ground floor office use could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 2 above moderate-income units.

When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 2 above moderate-income units (Tables C-34 and C35). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 du/acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Table C-30 Site #S-9 The Agency: Site Description
Site Description Site Image & Capacity Calculation
Address Northwest corner of Ocean and
Dolores
Realistic Capacity utilizing factors =
(0.09 X 33) (.90) (.95) (.95) = 2 units
100% of minimum density
APN 010-139-001-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles, but
nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.09 acre
Zoning CC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 2
units
Existing Use Non-vacant; retail space
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Appendix C – Sites Inventory C-53
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-31 Site #S-9 The Agency: Capacity Assumptions
Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the
site
95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental
Constraints
No adjustment No known site constraint
Source: City of Carmel-by-the-Sea
Site # S-10 Enzos
Enzo’s is a 0.15-acre corner lot adjacent to the Doud Arcade. It is a single-story structure occupied by a restaurant that could either be fully redeveloped or receive a second-floor addition. The site was included in the 5th Cycle inventory as a nonvacant site. The Enzo’s site has a building conditions rating of C4, which is maintained but requires minor repairs. This is in the lower tier of the building conditions rating. The building was constructed in 1940 and is 86 years old. The existing floor area ratio is 0.92, and the current zoning allows up to 1.5. The improvement-to-land ratio is below 1.0 at 0.85.

This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Ground floor commercial uses could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 4 above moderate-income units.

When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 4 above moderate-income units (Tables C-36 and C37). Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 dwelling units per acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Appendix C – Sites Inventory C-54
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-32 Site #S-10 Enzos: Site Description
Site Description Site Image & Capacity Calculation
Address San Carlos 2 Southwest of
Ocean
Realistic Capacity utilizing factors =
(0.15 X 33) (.90) (.95) (.95) = 4 units
100% of minimum density
APN 010-146-001-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles, but
nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.15 acre
Zoning CC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 4 units
Existing Use Non-vacant; commercial
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-33 Site #S-10 Enzos: Capacity Assumptions
Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea

Appendix C – Sites Inventory C-55
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site #S-11 Paseo San Carlos Square (Parcel 1)
Paseo San Carlos Square (Parcel 1) is a multi-tenant commercial building located on a 0.18-acre parcel.

It has low lot coverage and is a single-story structure that is surrounded by two-story structures to the west and across the street to the east. The site was included in the 5th Cycle inventory as a nonvacant site. The Paseo San Carlos site has a building conditions rating of C4, which is maintained but requires minor repairs. This is in the lower tier of the building conditions rating. The building was constructed in 1975 and is 51 years old. The existing floor area ratio is 0.75, and the current zoning allows up to 1.5.

The improvement-to-land ratio is 1.92. This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Ground floor commercial uses could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 5 above moderate units. When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 4 above moderate-income units (Tables C-38 and C-39).

Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 dwelling units per acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Appendix C – Sites Inventory C-56
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-34 Site #S-11 Paseo San Carlos Square: Site Description Site Description Site Image & Capacity Calculation
Address San Carlos 2 Northwest of 7th
Ave
Realistic Capacity utilizing factors =
(0.18 X 33) (.90) (.95) (.95) = 4 units
80% of minimum density
APN 010-146-003-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles,
but nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.18 acre
Zoning CC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 5
units
Existing Use Non-vacant; commercial space
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-35 Site #S-11 Paseo San Carlos Square: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the
site
95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental
Constraints
No adjustment No known site constraint
Source: City of Carmel-by-the-Sea

Appendix C – Sites Inventory C-57
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Site #S-12 Carmel Office Supply & Business Center
Carmel Office Supply & Business Center is a 0.09-acre parcel that includes a single-story structure that neighbors a two-story structure to the south. The building contains two commercial tenant spaces, one of which is currently vacant. The site was included in the 5th Cycle inventory as a nonvacant site. The Carmel Office Supply & Business Center site has a building conditions rating of C5, which is functional but requires repairs or rehabilitation. This is in the lower tier of the building conditions rating. The building was constructed in 1958 and is 68 years old. The existing floor area ratio is 0.97, and the current zoning allows up to 1.5. The improvement-to-land ratio is below 1.0 at 0.74. This site meets three of the four objective criteria previously discussed for selecting underutilized sites with potential for redevelopment. Additionally, the property owner has met with the City and expressed interest in adding residential uses above the ground floor commercial space. Ground floor commercial uses could be retained with the addition of second story residential uses, similar to the construction of the condominium over the one-story commercial space occupied by a restaurant on Dolores Street, south of Piccadilly Park.

The site is zoned Central Commercial (CC), which currently allows residential densities up to 22 du/acre by-right, 33 du/acre with approval of a conditional use permit, 44 du/acre under the Density Bonus law, and up to 88 du/acre if the project is 100 percent affordable. Program 3.1.G has been included in this housing element to establish a by-right density of 22-40 du/acre for residential development in the commercial districts (see Chapter 2).

Developed at 33 du/acre, the gross acreage of the site would produce 2 above moderate units. When factoring in potential land-use controls and site improvements, the site's realistic capacity, and typical densities, the site's net acreage would yield 2 above moderate-income units (Tables C-40 and C-41).

Based on recent developments, such as Ulrika Plaza and Scandia Lopez/Hakim, both located in the commercial district, the City has determined that 33 dwelling units per acre, including adjustments, is the most feasible density for development on this site. A density of 33 du/acre would be achieved through a zoning code amendment allowing a by-right density of 22-40 du/acre.

Appendix C – Sites Inventory C-58
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Table C-36 Site #S-12 Carmel Office Supply & Business Center: Site Description Site Description Site Image & Capacity Calculation
Address Lincoln Southeast of Ocean
Realistic Capacity utilizing factors =
(0.09 X 33) (.90) (.95) (.95) = 2 units
100% of minimum density
APN 010-147-010-000
By-Right with 20%
Affordable
No, used in 4th and 5th cycles,
but nonvacant.

Not used to meet lower income
RHNA for 6th cycle.

Size of Site 0.09 acre
Zoning CC
Allowable Density 0-22 du/ac*
Applied RHNA
Affordability
Above Moderate-Income: 2
units
Existing Use Non-vacant; commercial space
Infrastructure
Availability
Yes, no constraints.

Environmental
Constraints
None known
Other Constraints Shape: None
Access: None
Title Conditions: None
Historic Preservation: None
Easement: None
Source: City of Carmel-by-the-Sea
Notes: *The existing Carmel Municipal Code establishes a by-right density of 0-22 du/acre in the commercial zones (CC, SC, and RC).

Program 3.1.G establishes a by-right density of 22-40 du/acre in the commercial zones. Assumptions for site development use 33 du/acre.

Table C-37 Site #S-12 Carmel Office Supply & Business Center: Capacity Assumptions Site Description Adjustment Reasoning
Land use controls and site
improvements
90% For net acreage due to challenging site geometry, on-site improvements, and utility easement needs.

Realistic capacity of the site 95% Based on market demand for medium-density housing types such as condominiums, apartments, townhomes, and single-family and current cost of construction.

Typical densities 95% Future medium-density projects in Carmel-by-the-Sea are more likely to be built out close to maximum density due to lot sizes, limited developable sites, and very high demand for new units.

Infrastructure availability No adjustment Not applicable, no constraints Environmental Constraints No adjustment No known site constraint Source: City of Carmel-by-the-Sea

Appendix C – Sites Inventory C-59
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 C.5 Summary of RHNA Strategies
The revised Housing Element provides a comprehensive strategy to meet the City’s RHNA through diverse housing options and locations.

Table C-38 Summary of Sites Inventory
Very LowIncome
Units
LowIncome
Units
ModerateIncome
Units
Above
ModerateIncome
Units
Total
Units
RHNA Figures
Total RHNA 113 74 44 118 349
Credits (ADUs and Pipeline
Projects)
13 13 13 29 68
Remaining RHNA 100 61 31 89 281
ADUs 21 21 21 7 70
Hotel Conversion 40 40 40 41 161
Church Properties 33 32 0 0 65
All Saints’ Episcopal 10 10 0 0 20
First Church of Christ, Scientist 7 6 0 0 13
Church of the Wayfarer 16 16 0 0 32
Live/Work Units 39 39 0 0 78
Mixed-Income Incentive Program 2 2 2 6 12
Other Housing Opportunities 0 2 0 46 48
Forest Cottages Specific Plan 0 2 0 4 6
Other Market Rate Scattered Sites 0 0 0 42 42
Total Capacity 135 136 63 100 434
Over Remaining RHNA 35 75 32 11 153
% Over Remaining RHNA 35% 123% 103% 12% 54%
Source: City of Carmel-by-the-Sea, Community Planning & Building Department

Appendix C – Sites Inventory C-60
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 Figure C-7 Sites Inventory Map

Appendix C – Sites Inventory C-61
Carmel-by-the-Sea 6th Cycle Housing Element Amendment July 7, 2026 C.6 Technical Background Documents
Exhibit A - Hotel Conversion Full Proforma
Table C-39 Basic Pro Forma of Hotel-to-Residential Program Sample Hotel Operating at one standard deviation below average RevPAR in Carmel Market Rooms 19
Average Daily Rate (ADR) $ 211
Occupancy 68%
Revenue Per Available Room (RevPAR) $143
Annual Revenue $ 995,034 $ 52,370 per key
Net Operating Income (NOI) 35% $ 348,262 $ 18,330
Valuation Method
Gross Rent Multiplier (GRM) 7.7% $ 7,612,009
Cap Rate Value 4.50% $ 7,739,152
Average Valuation $ 7,675,580 $ 403,978
Sample Hotel Conversion to Affordable Housing
Hotel to Housing Conversion Ratio 85%
Affordable Housing Units Created 16
Affordable Housing Type Approx. Share Units Created
Efficiency/Studio (1) 50% 8
1 Bedroom (1.5) 50% 8
Efficiency/Studio (1) Qty Mo. Rent Mo. Revenue
Very Low 2 $ 1,159 $ 2,318
Low 2 $ 1,854 $ 3,708
Moderate 2 $ 2,168 $ 4,336
Market Rate 2 $ 2,600 $ 5,200
1 Bedroom (1.5) Qty Monthly. Rent Monthly Revenue
Very Low 2 $1,325 $ 2,650
Low 2 $ 2,120 $ 4,240
Moderate 2 $ 2,478 $ 4,956
Market Rate 2 $ 3,000 $ 6,000
Annual Housing Revenue $ 400,896 $ 25,056 per Unit
Maintenance 20% $ (80,179)
Utilities (excludes Market Rate Units) $ (18,000)
Net Operating Income (NOI) $ 302,717 $ 18,920
Cap Rate Value* 6.00% $ 5,045,280 $ 315,330
Summary
Purchase of Hotel $ 7,675,580
Conversion Costs Per $ 100,000 $ 1,600,000
Total Developer Investment $ 9,275,580
Sale of Hotel Keys Per $ 438,656 $ 8,334,464
Sale of Affordable Housing $ 5,045,280
Total Developer Return $ 13,379,744
Return on Investment (ROI) 44.25%
* Deed-Restricted Affordable Housing, compared to market rate multifamily properties which fall in the 4% range.

Review of Previous Housing Element D

APPENDIX

Table of Contents
APPENDIX D REVIEW OF PREVIOUS HOUSING ELEMENT ............................................ D-1 D.1 Introduction ........................................................................................................................... D-1 D.2 Effectiveness of the Element............................................................................................... D-1 D.3 Progress in Implementation ................................................................................................. D-2 D.4 Summary .............................................................................................................................. D-13 Tables
Table D-1 Overview of Adopted Programs ............................................................................ D-3 Table D-2 Housing Units Produced, 2015-2023 ................................................................... D-13

Appendix D Review of Previous Housing Element D-1 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Appendix D
Review of Previous Housing Element
D.1 Introduction
In order to effectively plan for the future, it is important to reflect back on the goals of the previous Housing Element and to identify those areas where progress was made and those areas where continued effort is needed. State Housing Element guidelines require communities to evaluate their previous Housing Element according to the following criteria:

Effectiveness of the Element;
Progress in Implementation; and
Appropriateness in Goals, Objectives and Policies.

D.2 Effectiveness of the Element
Goal G3-1 Preserve the existing housing stock;
Goal G3-2 Preserve existing residential units and encourage the development of new multifamily housing in the Commercial and R-4 Districts; Goal G3-3 Provide adequate sites for the development of a wide range of housing types for all citizens;
Goal G3-4 Protect the stability of residential neighborhoods by promoting year-round occupancy and neighborhood enhancement; and
Goal G3-5 Preserve and increase the supply of housing for lower- and moderate-income households, senior citizens and other special needs groups. Prohibit discrimination in the sale or rental of housing.

In order to achieve these goals, the 2015 Housing Element listed a series of policies and actions. The policies covered a range of actions, including (but not limited to): development of mixed-use projects with high-density housing; preserving existing second-floor housing over first-floor commercial uses; converting R-1 hotels to housing; enforcing -term rentals; reviewing requirements for conditional use permits on multi-family developments with

Appendix D Review of Previous Housing Element D-2 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 densities greater than 22 du/ac; using City-owned surplus sites for affordable housing; and granting water priority to affordable housing projects. The 2015 policies and programs complied with State Housing Law guidelines in effect at the time.

D.3 Progress in Implementation
To assess the progress in implementing the 2015 Housing Element, the following key areas were reviewed:

Adopted Programs;
Production of Housing;
; and
Rehabilitation of Existing Units.

Each of these areas is discussed in detail below.

Overview of Adopted Programs
Table D-1, Overview of Adopted Programs, identifies all of the actions the City committed to in the 2015 Housing Element. The table also includes a description of the progress that was made during the 2015 2023 planning period.

Production of Housing
The 2015 Housing Element identified a Regional Housing Needs Allocation of 31 housing units in the City of Carmel-by-the-Sea between January 1, 2015 and June 30, 2023. The RHNA was divided into the following income categories:
7 units affordable to extremely low- and very low-income households; 5 units affordable to low-income households;
6 units affordable to moderate-income households; and
13 units affordable to above moderate-income households.

Appendix D Review of Previous Housing Element D-3 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Table D-1 Overview of Adopted Programs
Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Goal G3-1: Preserve the existing housing stock.

Program 3-1.1.a
Housing Rehabilitation Information. Distribute information on the Inspection Services and Housing Rehabilitation programs available through Monterey County, and alternative ways of financing home repairs.

During the planning period, the City provided information on rehabilitation programs, inspection services, and home repair financing at make navigation
easier.
passive activity that can effectively educate and inform the public.

Modify to improve
effectiveness by
taking a more active
role in disseminating
information at
established venues
Market, Library
programming and
local service
organizations.

Program 3-1.1.b
Residential Inspection Services. Inspect residences in the community for structural deficiencies and repair needs at the request of the property owner.

Throughout the Planning period, the City provided residential inspection services to residents as part of Code Enforcement complaints and during the building permit process. However, the City is not staffed to provide inspections outside of the building permit process and does not maintain the required certifications to identify structural deficiencies.

Delete
Program 3-1.1.c
Housing Maintenance Information. Disseminate informational materials identifying techniques used to upgrade property consistent with health and safety standards. The informational materials will continue to be conjunction with Program 3-1.1.a.

During the planning period, the City provided housing maintenance information at City Hall and on the City website to facilitate the preservation of the existing housing stock. During the Planning period, that make
navigation easier.
passive activity that can effectively educate and inform the public. To improve program effectiveness, capture a broader audience, and take a more active role in disseminating information, the City will take programming, and local service organizations to promote available resources.

Modify and Combine
with 3-1.1.a.

Appendix D Review of Previous Housing Element D-4 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Goal G3-2: Preserve existing residential units and encourage the development of new multi-family housing in the Commercial and R-4 Districts.

Program 3-2.1.a
Incentives for Mixed-Use Development. Provide floor area bonuses of up to 15 percent for projects that include housing for Moderate-, Low- and Very-Low-income households. Distribute informational materials outlining the floor area and other applicable incentives.

The City continues to encourage affordable housing in mixed-use development. No development participated in this program and it was not effective in generating additional new units.

Modify to improve the
incentive
Program 3-2.1.b
Preserve and Increase Second Floor Residential Uses. Prohibit the conversion of existing second-floor residential floor space to commercial use. Require newly constructed floor space at the second floor to be used as residential units.

The City continues to preserve existing second floor residential uses and encourages the conversion of second floor commercial space to residential use. This was a successful program that resulted in protection of existing units and construction of new units.

Continue.

Program 3-2.1.c
Incentives for Mixed Use Affordable Housing. Explore options to further incentivize upper-story housing opportunities, such as the potential of allowing a third story when devoted to affordable housing subject to appropriate design standards, including the -foot height limit.

The City continues to look for ways to increase affordable housing opportunities. The City approved the Del Dono I and Del Dono II projects which included Moderate income units and a 3rd floor mezzanine.

Modify to specify 3rd
floor mezzanine.

Program 3-2.1.d
Multi-Family Residential Development Review. Monitor multifamily residential development applications to assess whether the CUP requirement (CUP for MFDs at densities 22 du/ac +) is posing an unreasonable development constraint. If it is determined that the CUP requirement is negatively affecting the cost and supply of housing, the City will initiate Zoning Code and LCP amendments to revise permit requirements for residential projects with densities greater than 22 du/ac to ensure permits are granted based on objective criteria.

The City monitored the review process for multi-family residential development and found that the Use Permit requirement for multi-family projects at densities between 23 and 33 dwelling units per acre was not a deterrent to development. The primary constraint to increased density remains a lack of water resources. However, the City remains open to eliminating the Use Permit requirement for all densities greater than 22 dwelling units per acre.

While the monitoring of multi-family residential development applications did not reveal an unreasonable development constraint, the elimination of the Use Permit requirement would result in cost savings for applicants who would no longer have to pay the Use Permit application fee. Additionally, the application processing time would be reduced by eliminating one of the permit entitlements.

Modify to remove the
CUP requirement for
densities up to 33
du/ac.

Appendix D Review of Previous Housing Element D-5 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Goal G3-3: Provide adequate sites for the development of a wide range of housing types for all citizens.

Program 3-3.1.a
Adequate Sites. The City will encourage and facilitate the development of new dwelling units consistent with the RHNA need by continuing to work with housing providers such as the Carmel Foundation. The City will also encourage development of new affordable units through incentives and concessions outlined in Programs 3-5.4.a, 3-5.4.b, 3-5.5.a, 3-5.5.b, and 3-5.5.c of this Housing Element.

The City encouraged the construction of new dwelling units to meet the City's RHNA requirements and promoted incentives and concessions to facilitate new construction. A lack of water resources continues to be the largest constraint to developing high-density housing.

The Carmel Foundation manages 50 affordable senior housing units in Carmel. While the City has a long-standing relationship with the Foundation, they do not accept government funding, and the operating costs of the housing units result in an annual deficit. Identification of additional funding sources and housing providers should be considered while maintaining a strong relationship with the Foundation.

City staff regularly promotes the incentives available for developing new affordable units when meeting with prospective developers and processing new development applications. The primary constraint to increased density remains a lack of water resources.

Modify. The City will
craft a policy
requiring minimum
densities.

Program 3-3.1.b
Surplus Sites. Investigate the feasibility of utilizing surplus sites for housing development and partnering with housing providers to develop housing for lower-income households and/or senior housing on appropriate surplus sites.

The City continues to evaluate the feasibility of constructing new housing on surplus land, specifically the Sunset Center parking lots (north and south). No development partners emerged during this Housing Element cycle; however, discussions remain ongoing.

Modify to identify
underutilized Cityowned sites including
Flanders Mansion,
Sunset Center
parking lots, Post
Office parking lot and
Vista Lobos.

Program 3-3.1.c
Development on Small Sites. The City will continue incentives and provisions that facilitate development on small sites including reduced parking requirements for affordable housing projects (0.5 parking spaces per unit), density bonuses that allow for development up to 88 du/ac, flexible or in some cases no required During the planning period, the City maintained reduced parking requirements for affordable housing projects and the density bonus provisions allowing high-density housing development of up to 88 dwelling units per acre. A lack of water resources continues to be the largest constraint to developing high-density housing.

Modify to continue lot
merger approval by
Director, simplify
parking requirement
reductions,

Appendix D Review of Previous Housing Element D-6 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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setbacks in the R-4 zone, and lot mergers. The City will review its Lot Merger Program to determine if any refinements should be made, including a requirement that mergers be approved by the Planning Commission rather than the Director. The City may also consider incentives for commercial lot mergers when lower-income units are provided, and eliminating any provisions of this program that have the unintended effect of restricting housing opportunities.

The City continued to promote incentives associated with lot mergers in the single-family district, including additional floor area for the primary dwelling and accessory dwelling units, additional site coverage, and an additional accessory structure. Lot merger applications continue to be approved by the Community Planning & Building Director.

No development participated in the density bonus or setback incentive in the commercial or multi-family districts.

The City did not pursue a lot merger incentive program for the commercial districts. Density bonus regulations continue to provide the greatest incentive.

Most lot merger applications were for single building sites comprised of multiple legal lots of record. Merging these sites did result in the granting of incentives
reevaluate the
density bonus and
setback incentives.

Program 3-3.2
Address Infrastructure Constraints. Work cooperatively with the Monterey Peninsula Water Management District (MPWMD) and other regional agencies to address infrastructure limitations (e.g. sewer, water, roads) that affect the ability to serve new housing development. Grant water allocation priority to those projects that assist the City in meeting its share of the regional housing need for lower- and moderate-income households.

During the planning period, the City continued to work with regional agencies such as the Monterey Peninsula Water Management District (MPWMD) and the Carmel Area Wastewater District (CAWD) to ensure adequate infrastructure is in place to accommodate new housing and maintenance of existing residential units. Additionally, the City focused Public Works Department continues to improve City infrastructure related to road maintenance and storm drains. The City continued prioritizing water allocation for lower-income units; however, no development applications were received for lower-income housing.

Lack of water resources continues to be a significant constraint to housing development. The City will establish a formal policy to prioritize water allocations to affordable housing projects.

Modify to further
prioritize water
allocation for lower
income units by
developing a new
City policy.

Appendix D Review of Previous Housing Element D-7 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Goal G3-4: Protect the stability of residential neighborhoods by promoting year-round occupancy and neighborhood enhancement.

Program 3-4.1.a
Permanent Housing. Continue to implement the ordinance
adopted in 1988 prohibiting short-term, transient rentals and timeshares of residential dwellings in the R-1 District.

The City continued to enforce the prohibition of short-term rentals in the single-family residential district. The City continues to use Host Compliance as part of the ongoing enforcement. On average, 27 violation letters were mailed annually during the planning period.

A significant percentage of single-family homes continue to remain vacant for part of the year due to second home ownership.

During the planning period, the City enforced the provisions of the Timeshare Ordinance and made minor updates to the Ordinance to increase clarity. One enforcement action was taken against a timeshare company during the planning period.

Modify to explore
methods to raise
funds including
establishing an
Affordable Housing
Trust Fund, , property
tax reduction or ADU
incentive program.

Program 3-4.1.b
Conversion of R-1 Motels. Continue to allow conversion of R-1 motel units into permanent residences with the transfer of vacated rooms to the commercial district.

During the planning period, the City allowed the conversion of R-1 motels to permanent residences. Specifically, the Happy Landing Inn was converted to a permanent residence during the planning period.

Additionally, a change in ownership of the Carmel Resort Inn resulted in a development application to downsize the footprint of the hotel property and construct 8 new single-family dwellings. Two of the 8 homes have been approved by the Planning Commission.

Modify to better
incentivize the
program to
encourage MFD.

Program 3-4.2.a
Neighborhood Compatibility. Continue to enforce height, coverage and floor area standards to ensure that new construction and remodels do not present excess visual mass or bulk to public view or to adjoining properties. Continue to enforce design standards which ensure that buildings relate to a human scale and that they avoid use of oversize design elements that make them appear dominating or monumental. Continue to require that projects not meeting adopted design guidelines be reviewed by the Planning Commission.

The City continues to review new construction for compatibility with the existing neighborhood. In 2021, the City received 26 new Track 2 Design Study planning applications for single-family units which required Planning Commission hearings.

Delete.

Appendix D Review of Previous Housing Element D-8 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Program 3-4.2.b
Support Community Organizations. Continue to support
neighborhood organizations that promote neighborhood
involvement, safety and improvement. When appropriate, develop partnerships with these organizations to promote neighborhood enhancement programs, conduct outreach, and solicit community input.

The City continues to support and partner with neighborhood organizations such as the Carmel Residents Association and the Carmel Foundation and the more recently formed Carmel Cares. These community organizations are an effective means to provide a wide variety of services to residents including meal programs, mobility equipment loans, caregiver support and general information and resources to help navigate the complex world of services and resources.

Modify to further
support outreach and
education.

Program 3-4.3.a
Neighborhood Preservation Educational Programs. Continue to use education programs to improve public understanding of the compatible housing design within existing neighborhoods, and provide zoning flexibility and incentives to facilitate rehabilitation of historic resources.

The City continues to implement the Historic Preservation Ordinance and the review of properties for historical significance upon submittal of a planning application. In 2021, the City reviewed 75 residential properties for historical significance and property improvements. The City uses the Historic Building Code to facilitate residential rehabilitation.

Continue.

Goal G3-5: Preserve and increase the supply of housing for lower- and moderate-income households, senior citizens and other special needs groups. Prohibit discrimination in the sale or rental of housing.

Program 3-5.1
Reasonable Accommodation Procedures. Continue to
implement Policy C11-01, which describes procedures to provide reasonable accommodation for persons with disabilities in compliance with the provisions of SB 520. Information on reasonable accommodation procedures shall be provided at City The City continues to promote the reasonable accommodation process to residents on a project specific basis. A number of inquiries were received throughout the planning period; however, only seven (7) applications were received. All applications were approved. The City is currently evaluating the application fee to ensure it does not discourage the use of the policy.

Modify to reduce
permit fee.

Program 3-5.2
Shared Housing Information. Distribute informational materials from the Monterey County Housing Authority to the Carmel Foundation and display information at City Hall and other public The City continues to provide information related to shared housing information . This program has
generally been effective and the Carmel Foundation has over 2,600 members, many of whom live in Carmel and the surrounding region.

Modify to clarify
intent and enhance
education and
outreach.

Appendix D Review of Previous Housing Element D-9 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Program 3-5.3a
Condominium Conversions. Continue to implement
condominium conversion policy, which restricts the conversion of apartments to condominiums to preserve the lower-cost rental housing options, typical of apartments, within the City. Apartments cannot be converted to condominiums unless a new apartment is being created to offset the conversion.

The City continues to implement the Condominium Conversion Ordinance to actively preserve and protect existing apartments. No formal applications for condominium conversions were submitted during the planning period and the Ordinance appears to be effective in halting conversions.

Continue.

Program 3-5.3.b
Section 8 Rental Assistance. Continue to facilitate use of the Section 8 program in the community by distributing information for the program at City Hall and the Library.

The City continues to provide information regarding Housing Choice Voucher (Section 8) rental assistance
and through the library.

Continue.

Program 3-5.3.c
Subordinate Units. The City's Municipal Code allows construction of new subordinate units as a permitted use on lots of 8,000 square feet or greater to provide additional rental housing in the R1 District to lower-income households. To further encourage the creation of subordinate units, the City will investigate potential amendments such as permitting subordinate units on smaller lots.

In addition, the City will implement incentives which may include waiver/reduction of certain fees, priority processing, and reduced parking and setback requirements. The City will provide informational materials on incentives and technical assistance to property owners. The informational materials will be available at City Hall
The City has a long history of permitting Subordinate Units (now called Accessory Dwelling Units). The City reviewed the subordinate unit regulations during the planning period and adopted updated regulations to facilitate new dwelling units. The amended regulations were approved Local Coastal Plan. The City is currently working on additional amendments to the regulations in accordance with State law.

During the planning period 36 applications (in 2021, the City received 18 new applications) for Accessory Dwelling Units (ADUs) were received and continues to issue building permits for ADUs. This program was effective and will be modified to further encourage ADUs and Junior ADUs.

Modify to reflect
State Laws governing
ADUs and combine
regulations for
Subordinate Units
and Guest Houses to
clarify regulations.

Allow the use of
ADUs at existing
hotels as a means of
employee housing.

Program 3-5.3.d
Monitor Affordable Housing Stock. 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.

Annually monitor the affordable housing stock in the coastal zone to ensure the affordable housing within the coastal zone is being protected and provided as required by Government Code Section 65590. The City will track data on the new construction, demolition, conversion and replacements housing units for low- and moderateincome households within the coastal zone including the following:

The City continued to monitor the existing affordable housing stock in partnership with the Carmel Foundation. Other than the defunct Del Dono I and II projects, no new affordable housing units were approved in the Coastal Zone during the planning period. Additionally, no existing affordable units were demolished or converted.

Modify to update the
City database to
better track
affordable housing
and facilitate
monitoring.

Appendix D Review of Previous Housing Element D-10 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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The number of new housing units approved for construction within the coastal zone;
The number of housing units for persons and families of lowand moderate-income required to be provided in new housing developments either within or within three miles of the coastal zone;
The number of existing residential dwelling units occupied by low- and moderate-income households required either within or three miles of the coastal zone that have been authorized to be demolished or converted; and,
The number of residential dwelling units for low- and moderateincome persons and families that have been required for replacement (of those units being demolished or converted) within or three miles of the coastal zone.

Program 3-5.4.a Density Bonus. Review and revise applicable density bonus ordinances to comply with State law.

The City adopted a new density bonus ordinance in conformance with State requirements. No development took advantage of the density bonus ordinance during the planning period possibly because the regulations are confusing and difficult to apply.

Modify to clarify
regulations.

Program 3-5.4.b
Housing for Extremely-Low Income Households. Encourage
the development of housing units for households earning 30 percent or less of the Median Family Income (MFI) for Monterey County. Specific emphasis shall be placed on the provision of family housing and non-traditional housing types such as singleroom-occupancy units and transitional housing. Encourage development of housing for extremely-low-income 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 The City continued to work with developers and promote the construction of affordable housing. Projects that included affordable housing units received expedited review. These included Del Dono I and Del Dono II.

However, no applications for lower-income households were submitted during the planning period.

During the planning period, the construction of Accessory Dwelling Units (ADUs) provided housing opportunities for extremely low-income households.

Group Residential facilities are permitted with the approval of a Use Permit in the R-4 district. Group Residential is defined as Shared living quarters without separate kitchens or bathrooms for each room or unit, including boarding houses, dormitories, and private residential clubs, but excluding guesthouses. Continue.

Appendix D Review of Previous Housing Element D-11 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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offering additional incentives to supplement the density bonus provisions in State law.

Program 3-5.5.a
Reduced Entitlement and Development Fees. Continue to
reduce the amount of fees required for projects that provide affordable housing to the extent feasible.

The City continued to waive parking requirements for apartments in the Central Commercial (CC) District. The City also provides reduced parking in-lieu fees for constructing new residential units in other commercial zones.

Fee studies are conducted every 3 years. Fees are based on staff processing time. Other than the parking in-lieu fee (which has not been collected in years), the City does not impose impact fees.

Modify to reduce fees
for affordable
residential projects.

Program 3-5.5.b
Reduced Parking Requirements. Continue to offer reduced parking requirements for affordable housing developments.

In addition, investigate the feasibility and effectiveness of further reducing existing in-lieu fees and amending the existing shared parking program to include housing units in affordable housing projects.

The City continued to offer reduced parking standards for affordable housing and senior housing units. The City also waived on-site parking requirements and payment of parking in-lieu fees for new apartments in the Central Commercial (CC) zoning district. Additionally, the City passed an Ordinance fixing the parking in-lieu fee at the 2003 rate until further notice. The regulations can be confusing and the City will work to better clarify the program.

Modify.

Program 3-5.5.c
Expedited Processing Procedures. Continue to offer expedited review procedures for residential projects that include affordable housing units.

The City continues to expedite the review of projects that include an affordable housing component. Specifically, the City expedited the review of two housing projects, Del Dono I and Del Dono II, which included 16 residential units with 2 deed-restricted moderate-income units. Unfortunately, a lack of construction funding halted the project's construction, and the properties are now under new ownership. A revised housing proposal that includes 12 apartments is under review and does not currently include any affordable housing and therefore does not qualify for expedited processing. The expedited regulations can be confusing and the City will work to better clarify the program.

Modify to clarify and
refine expedited
processing
procedures.

Program 3-5.6.a
Energy Conservation and Green Building. Continue to review applications for new construction and substantial alterations taking into consideration solar orientation and access to sunlight.

Additionally, continue to require compliance with current state building standards for energy efficiency in all new homes.

The City continues to promote energy conservation through the building plan check review process. The City will continue to implement the energy conservation requirements set forth in the Building Code and look for opportunities to promote energy conservation at City Hall and on the City website.

Modify to enhance
outreach efforts.

Appendix D Review of Previous Housing Element D-12 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Program
Number
Programs/Actions
[The text provided in this column is a synopsis only; for complete program language please refer to the 2015 Housing Element] Achievements/Effectiveness
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Program 3-5.6.b
Water Conservation. Enforce the Water Management Program and provide information to the community on water conservation retrofits and best practices. In addition, provide information on and promote water conservation education and retrofit rebates provided by the Monterey Peninsula Water Management District.

The City continues to promote water conservation in coordination with the Monterey Peninsula Water Management District. The City will continue these efforts and look for opportunities to further promote water conservation measures.

Modify to enhance
outreach efforts.

Program 3-5.7
Fair Housing Services. 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 shall coordinate with these agencies to provide printed information about fair housing services at City Hall, on the refer inquiries related to fair housing to these agencies.

The City provides fair housing information to the public at City Hall and on the City website and will continue to maintain and update the information. The City will continue to maintain, update and look for opportunities to expand the information available to the public.

Modify to enhance
outreach efforts.

Program 3-5.8
Zoning for Transitional and Supportive Housing. In compliance with SB 2, the City will continue to allow transitional/supportive housing as a residential use, subject only to those requirements of other residential dwellings of the same type in the same zone.

The City did not receive any inquiries regarding transitional or supportive housing during this planning period.

Continue and update
the Municipal Code.

SOURCE: City of Carmel-by-the-Sea

Appendix D Review of Previous Housing Element D-13 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Table D-2 provides a summary of housing units produced in the city from 2015-2023. During the 2015 2023 planning period, 18
approximately 58 percent of the
than anticipated, likely due to the lack of available water, the COVID pandemic, the cost of land, and the overall lack of support for new housing development in the community. All 18 units produced were affordable to households with above-moderate incomes.

Table D-2 Housing Units Produced, 2015-2023
Affordability New Construction
Need
Housing Units
Produced Percent Achieved
Very Low 7 0 0.0%
Low 5 0 0.0%
Moderate 6 0 0.0%
Above Moderate 13 18 100.0%
Total 31 18 58%
SOURCE: HCD Annual Progress Report Dashboard (as of May 19, 2023).

NOTE: This table should be updated prior to finalization to account for units through January 1, 2024. of information on subsidized affordable housing at risk of losing its affordable status and converting to market-rate housing.1 According to the database, there are no federal or state assisted units in Carmel-by-the-Sea. Currently, there are no affordable housing units at risk of conversion to market rate.

Rehabilitation of Existing Units
The 2015 Housing Element identified an objective of rehabilitating a total of 16 affordable units and 784 above-moderate-income units in the 2015 2023 planning period. The City issued over 250 building permits on average each year that permitted re-roofs, water heater upgrades and replacement, electrical upgrades, window repairs and replacements, and remodels.

D.4 Summary
Like many communities, the City of City of Carmel-by-the-Sea experienced strong development of single-family homes, Accessory Dwelling Units and conversion of second-floor commercial space to residential units during the 2015 2023 planning period. Of the 31 1 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.

Appendix D Review of Previous Housing Element D-14 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 RHNA, the City permitted 18 units (approximately 58 percent of the total), all of them for above moderate-income households; however, some of these units are ADUs which represent housing opportunities for lower-income housing.

The goals, objectives, and policies identified in the 2015 Housing Element were appropriate for the 2015-2023 timeframe because they complied with the program requirements mandated by State law at the time. The 6th Cycle Housing Element will be revised to address new state mandates and to put the City of Carmel-by-the-Sea on track to fully meet its housing obligations.

List of Contacted Organizations E

APPENDIX

Table of Contents
APPENDIX E LIST OF CONTACTED ORGANIZATIONS ................................................E-1 E.1 Introduction ........................................................................................................................... E-1 E.2 List of Contacted Organizations ......................................................................................... E-1 E.3 City Contact List .................................................................................................................... E-4 E.4 Tribal Consultation................................................................................................................ E-5 E.5 Service Organizations ........................................................................................................... E-7 E.6 Additional Outreach .............................................................................................................. E-9

Appendix E- List of Contact Organizations E-1 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Adopted April 8, 2024 Appendix E
List of Contacted Organizations
E.1 Introduction
This Appendix provides the names of organizations, tribal units, and other stakeholders that were contacted during the preparation of Carmel-by-the-Sea’s 6th Cycle Housing Element. In addition to these contacts, the City created a dedicated website called: “HOME Carmel-by-the-Sea” which can be found at https://homecarmelbythesea.com. This website provides a portal to all of the Housing Element-related community engagement activities that were available to members of the public during the update process. This includes information on Housing Element basics, site surveys, stakeholder surveys, and materials from community workshops.

E.2 List of Contacted Organizations
This section provides contact information for organizations and agencies in the Monterey Bay Area, stakeholder property owners, and interested parties that were contacted during the Housing Element preparation.

Organizations and Agencies
Association of Monterey Bay Area Governments
24580 Silver Cloud Court
Monterey, CA 93940
T: (831) 883-3750
Heather Adamson
Association of Monterey Bay Area Governments (ambag.org) Monterey Peninsula Water Management District
5 Harris Court, Building G
Monterey, CA 93940
T: (831) 658-5601
Stephanie Locke
Monterey Peninsula Water Management District (mpwmd.net) Carmel Area Wastewater District
3945 Rio Rd.

Carmel, CA 93922
T: (831) 624-1248
Carmel Area WasteWater District (cawd.org)

Appendix E – List of Contacted Organizations E-2 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Carmel Chamber of Commerce
Ocean Ave. between Junipero and Mission
Inside Carmel Plaza 3rd Floor
Carmel, CA 93921
(831) 624-3877
Carmel Chamber of Commerce
Carmel Foundation
SE Corner of 8th Ave. and Lincoln St.

Carmel, CA 93923
T: (831) 624-1588
Holly Zoller
www.carmelfoundation.org
Landwatch Monterey County
306 Capitol Street #101
Salinas, CA 93901
T: (831) 759-2824
Jose Torres
Monterey County - LandWatch
Stakeholder Property Owners
ƒ Esperanza Carmel, Christopher Mitchell;
ƒ Carmel Realty, Bill Mitchell;
ƒ Pine Inn, Richard Gunner & Dave Tipton;
ƒ Bruno’s, Thomas Sweeney;
ƒ 3 Garages, Judie Profeta;
ƒ First Church of Christ, Kent Wadsworth;
ƒ Café Carmel, Greg Kraft and Kim Marie Archer;
ƒ Wells Fargo, Brian Buhowsky;
ƒ GBG, Montag Ivestor;
ƒ Carmel Presbyterian, Bob Spencer;
ƒ Yafa Property, Sandy Freschi;
ƒ Levett Properties, Denny Levett & Jeanne Cox Levett;
ƒ Doud Arcade, John Plastini; and
ƒ Linggi Building / Flaherty's, Alan Buchwald.

Appendix E – List of Contacted Organizations E-3 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Interested Parties
ƒ Eric Miller Architects, Eric Miller;
ƒ Silverie Properties, Dan Silverie III;
ƒ Silcon Constructors, Dan Silverie IV;
ƒ Winter & Co, Nore Winter;
ƒ Carmel Plaza, Kristin Torrice;
ƒ Carmel Residents Association, Nancy Twomey;
ƒ Carmel Preservation Association;
ƒ Carmel Heritage Society;
ƒ Monterey Bay AIA, Executive Director;
ƒ Builders Exchange, Sandy Steele;
ƒ Christ Tescher Construction, Chris Tescher;
ƒ Carmel Boutique Inns/Vagabond House Inn, Amanda Levett; ƒ Jody LeTout;
ƒ Walker and Reed, Jim Heisinger;
ƒ American Legion, Gerry Paratore;
ƒ Cal-Clark Farms, Stu Clark;
ƒ Bennett Sculpture Carmel, Ashley Stoddard;
ƒ Sue McCloud;
ƒ Su Vecino, Shari Polovneff;
ƒ Vesuvio, Little Napoli, Carmel Bakery, Rich Pepe;
ƒ Luca/L’auberge/Carmel Beach Hotel, David Fink;
ƒ Hakim, Jack Hakim;
ƒ Mandurrago & Associates, John Mandurrago;
ƒ Forge in the Forest, Greg Profeta;
ƒ Classic Hotels, Mary Crowe;
ƒ Carmel Lodge, Mark Stilwell;
ƒ Dyar Architects, Erik Dyar;
ƒ Thomas Bateman Hood Architects, Thomas Hood;

Appendix E – List of Contacted Organizations E-4 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ƒ Justin Pauly Architects, Justin Pauly;
ƒ Cushman Wakefield Properties, Michael Schoeder;
ƒ Fred Kern;
ƒ Lewis Builders, Scott Julian;
ƒ Beesley Realty, Ben Beesley;
ƒ Visit Carmel, Amy Herzog;
ƒ Jeanne Cox Levett;
ƒ Gerard Rose;
ƒ Franklin Williams; and
ƒ Catherine and John Compango.

E.3 City Contact List
This section provides contact information for City officials that were involved with Housing Element preparation.

Elected and Appointed Officials
City Council
ƒ Dave Potter, Mayor;
ƒ Payor ProTem/Housing Ad Hoc Member, Bobby Richards;
ƒ City Councilmember/Housing Ad Hoc Member, Karen Ferlito; ƒ City Councilmember Jeff Baron; and
ƒ City Councilmember, Alissandra Dramov.

Planning Commission
ƒ Michael LePage;
ƒ Stephanie Locke;
ƒ Chris Bolton;
ƒ Robert Delves; and
ƒ Erin Allen.

Appendix E – List of Contacted Organizations E-5 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Historic Resources Board
ƒ Eric Dyar;
ƒ Karyl Hall;
ƒ Jordan Chroman;
ƒ Kathy Pomeroy; and
ƒ Esther Goodhue.

City Staff
ƒ Brandon Swanson, Director of Community Planning & Building; ƒ Marnie Waffle, AICP, Principal Planner;
ƒ Katherine Wallace, AICP, Associate Planner;
ƒ Chip Rerig, City Administrator;
ƒ Robert Harary, Public Works Director;
ƒ Gaudenz Panholzer, Fire Chief; and
ƒ Ashlee Wright, Library and Community Activities Director.

E.4 Tribal Consultation
This section provides contact information for all tribal consultation during Housing Element preparation.

Irene Zwierlein, Chairperson
Amah Mutsun Tribal Band of Mission San Juan Bautista
3030 Soda Bay Road
Lakeport, CA, 95453
Valentin Lopez, Chairperson
Amah Mutsun Tribal Band
P.O. Box 5272
Galt, CA 95632
Tony Cerda, Chairperson
Costanoan Rumsen Carmel Tribe
244 E. 1st Street
Pomona, CA, 91766

Appendix E – List of Contacted Organizations E-6 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Rudolph Rosales (Ulax Huchumas)
Indigenous Peoples Consultant
Esselen Nation
P.O. Box 647
Monterey, CA 93942
Susan Morley, Cultural Resources
Esselen Tribe of Monterey County
3059 Bostick Avenue
Marina, CA 93933
Tom Little Bear Nason, Chairman
Esselen Tribe of Monterey County
P. O. Box 95
Carmel Valley, CA, 93924
Ann Marie Sayers, Chairperson
Indian Canyon Mutsun Band of Costanoan
P.O. Box 28
Hollister, CA, 95024
Kanyon Sayers-Roods, MLD Contact
Indian Canyon Mutsun Band of Costanoan
1615 Pearson Court
San Jose, CA, 95122
Isaac Bojorquez, Chairman
Kakoon Ta Ruk Band of Ohlone-Costanoan Indians of the Big Sur Rancheria PO Box 8355
Woodland, CA, 95776
Christanne Arias, Vice Chairperson
Ohlone/Costanoan-Esselen Nation
519 Viejo Gabriel
Soledad, CA, 93960
Louise Miranda-Ramirez, Chairperson
Ohlone/Costanoan-Esselen Nation
P.O. Box 1301
Monterey, CA, 93942
Dee Dee Ybarra, Chairperson
Rumsen Am:a Tur:ataj Ohlone
14671 Farmington Street
Hesperia, CA, 92345

Appendix E – List of Contacted Organizations E-7 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Kenneth Woodrow, Chairperson
Wuksache Indian Tribe/Eshom Valley Band
1179 Rock Haven Ct.

Salinas, CA, 93906
E.5 Service Organizations
Housing Authority of the County of Monterey
123 Rico Street
Salinas, CA 93907
(831) 775-5000
Monterey County Department of Social Services
1000 South Main Street
Salinas, CA 93901
(831) 755-4448
Catholic Charities Dioceses of Monterey
922 Hilby Avenue, Suite C.

Seaside, CA 93955
Monterey Peninsula (831) 393-3110
Salinas Valley (831) 422-0602
United Way Monterey County
232 Monterey Street
Suite 200
Salinas, CA 93901
(831) 372-8026
CHISPA, Inc.
295 Main St. #100
Salinas, CA 93901
(831) 757-6251
Mid-Peninsula Housing Coalition
303 Vintage Park Drive
Suite 250
Foster City, CA 94404
(650) 356-2900
[email protected]
Habitat for Humanity Monterey Bay
108 Magnolia Street
Santa Cruz, CA 95062
(831) 469-4663
www.habitatmontereybay.com

Appendix E – List of Contacted Organizations E-8 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ECHO Fair Housing Services
580 Pacific Street
Monterey, CA 93940
(831) 566-0824
https://www.echofairhousing.org/fair-housing-services.html Central Coast Center for Independent Living
318 Cayuga Street
Suite 208
Salinas, CA 93901
(831) 757-2968
https://www.cccil.org/
Center for Community Advocacy
22 West Gabilan Street
Salinas, CA 93901
(831) 753-2324
https://cca-viva.org/
The Salvation Army Good Samaritan Center
1491 Contra Costa
Seaside, CA 93955
(831) 899-4911
https://montereypeninsula.salvationarmy.org/
Hope Services
1144 Fremont Blvd.,
Suite D
Seaside, CA 93955
(831) 393-1575
https://www.hopeservices.org/
Coalition of Homeless Service Providers
1942 Fremont Boulevard
Seaside, CA 93955
(831) 883-3080
https://chsp.org/
Monterey County Stand Down for Homeless Veterans
https://www.montereystanddown.org/
Diocese of Monterey
425 Church Street
Monterey, CA 93940
(831) 373-4345
https://dioceseofmonterey.org/

Appendix E – List of Contacted Organizations E-9 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 E.6 Additional Outreach
ƒ Website: “Housing Opportunities Made Easier (H.O.M.E.) Carmel-by-the-Sea” (homecarmelbythesea.com) launched April 5, 2023. The website is presented in English with surveys in English and in Spanish. Information continues to be posted on this website; ƒ Housing Element Website Information Published: April 2023, May 2023, June 2023; ƒ April, 2023 – ongoing: E-Notification informing the public to, “Visit our Dedicated Housing Element Website” was sent in April 2023 and included in subsequent “City Administrator Friday Letter” e-notifications on a near-weekly basis;
ƒ November 17, 2022: Housing Ad Hoc Committee Community Meeting provided a Housing Element Introduction and Overview;
ƒ February 7, 2023: City Council meeting to review the Housing Feasibility Study by ECONorthwest and enter into contract with EMC Planning Group for Housing and Safety Element updates;
ƒ March 28, 2023: Housing Ad Hoc Committee Community Meeting provided an overview of the housing feasibility study authored by ECONorthwest and constraints that limit housing production;
ƒ April 6, 2023: Housing Ad Hoc Committee Community Meeting addressed 5th Cycle accomplishments and goals, programs, and policies;
ƒ May 24, 2023: Housing Ad Hoc Committee Community Meeting discussed the importance of equity, housing needs assessment information, and potential 6th Cycle programs, and provided some strategies for sites and ways to provide feedback throughout this process; ƒ June 15, 2023: Joint City Council and Planning Commission Special Meeting hosted by the Housing Ad Hoc Committee was held to discuss the draft Housing Element and the 30-day public comment period and to provide an opportunity for the public to give verbal feedback/comments on the draft Housing Element;
ƒ July 11, 2023: City Council to provide strategic direction related to public comment received; ƒ August 1, 2023: City Council to review revised draft Housing Element before submittal to HCD; ƒ Advance (10-day minimum) public notice of all scheduled Housing Ad Hoc and Council meetings published in the local newspaper, The Carmel Pine Cone; ƒ City staff have notified all property owners of identified sites via U.S. mail and - where e-mail addresses were known - have e-mailed property owners to encourage potential redevelopment of private property; and

Appendix E – List of Contacted Organizations E-10 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ƒ The City has implemented varied methods of involvement for community members, including:
the HOME Carmel-by-the-Sea website, the Carmel-by-the-Sea City website/Long-Range Planning page, “Housing” email Listserv, “City Council” email listserv, announcements published in the City Administrator’s “Friday Letter” and vlog, public notices in The Carmel Pine Cone, a staffed table at the local Farmer’s Market; a Community Housing Stakeholder Survey made available in both English and Spanish, and seven (5) community meetings specific to the Housing Element topic and three (3) regular City Council meetings with an agendized Housing Element topic completed prior to submission of the Draft Housing Element to HCD.

Energy Conservation and Reduction of
Greenhouse Gas Emissions G

APPENDIX

Table of Contents

APPENDIX G ENERGY CONSERVATION AND REDUCTION OF GREENHOUSE GAS EMISSIONS ....................................................................................................... G-1 G.1 Introduction ........................................................................................................................... G-1 G.2 Opportunities for Energy Conservation and Reducing Greenhouse Gas Emissions . G-1 Tables
Table G-1 PG&E Programs and Incentives for Residential Properties .............................. G-3

Appendix G – Energy Conservation G-1 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Appendix G
Energy Conservation and Reduction of
Greenhouse Gas Emissions
G.1 Introduction
This chapter summarizes opportunities for energy conservation and the reduction of greenhouse gas emissions in the construction of housing in the City of Carmel-by-the-Sea.

G.2 Opportunities for Energy Conservation and Reducing
Greenhouse Gas Emissions
The city adopted a Climate Adaption Plan (CAP) and Climate Action Plan on August 2, 2022. The documents identify goals, policies, and actions that seek to increase resilience to climate change in Carmel. The CAP policy to minimize health impacts of climate change includes the following actions that address energy conservation and reduction of greenhouse gases:
ƒ Invest in Improving Resilience in Critical Facilities. Invest in sustainable backup power sources to provide redundancy and continued services for critical facilities, including City Hall, Carmel Police Department, Carmel Fire Department, the Libraries, and assisted living facilities in the event of a power outage.
ƒ Conduct a Feasibility Study for Existing Building Electrification and Back-up Power.

Perform an electrification feasibility study/existing building analysis in order to understand the potential for, and associated costs of, electrification retrofitting. Needs may include new heat pumps, on-site energy generation, and battery storage to provide more resilient back-up power supply. Establish a plan for reducing or eliminating natural gas from existing buildings, potentially through a reach code, and building resilience to potential electrical grid shutoffs. ƒ Improve Resilience in Existing Building Stock. Develop a program for identifying funding and incentives to weatherize residential and commercial buildings. The program will address severe weather protection, energy efficiency, indoor air quality improvements, and other housing improvements. Include an outreach campaign as part of this program to advertise the benefits of weatherizing and electrifying buildings.

Appendix G – Energy Conservation G-2 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ƒ Promote Funding Opportunities. Work with partners like 3CE and PG&E to identify and promote potential resilience opportunities and accessible funding and financing mechanisms to pay for building electrification, weatherization, and battery backups.

State Regulations
The City requires compliance with Title 24 of the California Code of Regulations on the use of energy efficient appliances and insulation. Through compliance with Title 24, new residential development has reduced energy demand particularly when contrasted with older building stock.

Providing energy conservation opportunities to residents who reside in less energy efficient residential units can ultimately lead to a reduction in utility-related housing costs for many households. The City processes in excess of 500 building permits per year for remodels, additions and other construction which rehabilitates the existing housing stock, increases energy efficiencies, and improves water conservation.

Central Coast Community Energy
Central Coast Community Energy (3CE) is the community electricity provider for 33 Central Coast communities in Monterey, San Benito, Santa Cruz, San Luis Obispo, and Santa Barbara counties and is governed by local elected officials serving on the Board of Directors. 3CE was formed with the mission to reduce dependence on fossil fuels by providing carbon-free, affordable, and reliable electricity, and innovative programs within the community. 3CE is on a path to sourcing 100 percent clean and renewable energy by 2030. In collaboration with regional and statewide partners, 3CE provides customers with access to energy program rebates and incentives to electrify the region’s transportation, buildings, and agricultural sector. Carmel-by-the-Sea is a member of 3CE.

Pacific Gas & Electric
Pacific Gas and Electric Company (PG&E), which provides energy efficiency services in Carmel-bythe-Sea, offers public information and technical assistance to homeowners regarding energy conservation. PG&E also provides numerous incentives for energy efficiency in new construction and home remodeling. For example, remodeling rebates exist for projects installing three or more upgrades from a flexible menu of options that earn points towards incentives and rebates. This program’s incentives range between $1,000 and $4,500.

Additionally, PG&E provides residents with information regarding energy saving measures including various incentives and programs available to developers and residential property owners. Table G-1, PG&E Programs and Incentives for Residential Properties, includes a description of the various types of financial and energy-related assistance that PG&E offers low-income customers.

Appendix G – Energy Conservation G-3 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Table G-1 PG&E Programs and Incentives for Residential Properties Program Description
Energy Savings Assistance
Program
PG&E’s Energy Savings Assistance program offers free weatherization measures and energy-efficient appliances to qualified low-income households. PG&E determines qualified households through the same sliding income scale used for CARE. The program includes measures such as attic insulation, weather stripping, caulking, and minor home repairs. Some customers qualify for replacement of appliances including refrigerators, air conditioners, and evaporative coolers.

Energy Efficiency for Multifamily
Properties
The Energy Efficiency for Multi-Family Properties program is available to owners and managers of existing multi-family residential dwellings containing five or more units.

Multifamily Properties The Energy Efficiency for Multifamily Properties program is available to owners and managers of existing multifamily residential dwellings containing five or more units.

The program encourages energy efficiency by providing rebates for the installation of certain energy-saving products.

California Alternate Rates for
Energy (Care)
PG&E offers this rate reduction program for low-income households. PG&E determines qualified households by a sliding income scale based on the number of household members. The CARE program provides a discount of 20 percent or more on monthly energy bills.

Reach (Relief for Energy
Assistance Through Community
Help)
The REACH program is sponsored by PG&E and administered through a non-profit organization. PG&E customers can enroll to give monthly donations to the REACH program. Qualified low-income customers who have experienced uncontrollable or unforeseen hardships, which prohibit them from paying their utility bills may receive an energy credit. Eligibility is determined by a sliding income scale based on the number of household members. To qualify for the program, the applicant’s income cannot exceed 200 percent of the Federal poverty guidelines.

Medical Baseline Allowance The Medical Baseline Allowance program is available to households with certain disabilities or medical needs. The program allows customers to get additional quantities of energy at the lowest or baseline price for residential customers.

SOURCE: PG&E, 2022.

Monterey Peninsula Water Management District (MPWMD)
The Monterey Peninsula Water Management District (MPWMD) was formed on June 6, 1978 under the enabling legislation found in West’s Annotated California Water Code. District functions include:
ƒ Augmenting the water supply through integrated management of ground and surface water; ƒ Promoting water conservation;
ƒ Promoting water reuse and reclamation of storm and wastewater; and ƒ Fostering the scenic values, environmental qualities, native vegetation, fish and wildlife, and recreation on the Monterey Peninsula and in the Carmel River Basin.

Appendix G – Energy Conservation G-4 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 The Water Management District serves approximately 105,911 people within the cities of Carmelby-the-Sea, Del Rey Oaks, Monterey, Pacific Grove, Seaside, Sand City, Monterey Peninsula Airport District, and portions of unincorporated Monterey County including Pebble Beach, Carmel Highlands, and Carmel Valley. The District has established five main goals:

1. Increase the water supply to meet community and environmental needs;

2. Assist California American (Cal-Am) Water in developing a legal water supply;

3. Protect the quality of surface and groundwater resources and continue the restoration of the Carmel River environment;

4. Instill public trust and confidence; and

5. Manage and allocate available water supplies and promote water conservation.

Rebates are available for water saving fixtures and appliances for homes and businesses. California American Water (Cal-Am), Seaside Municipal Water District, and other system customers within the District are eligible for a rebate when purchasing and installing water saving devices. Residential rebates are available for purchase of Qualifying Devices when funding is available. The following are residential rebates:
ƒ High Efficiency Toilet — $75;
ƒ Ultra High Efficiency Toilet — $125;
ƒ Toilet Flapper — $15;
ƒ Pint Urinal — $250;
ƒ High Efficiency Residential Dishwasher (Maximum of 3.5 gallons per cycle and has Energy Star certification) — $125;
ƒ High Efficiency Residential Clothes Washer (Water Factor of 4.3 and Energy Star Certification) — $500;
ƒ A second or subsequent rebate for replacing a High Efficiency Clothes Washer is available after 8 years;
ƒ Instant-Access Hot Water System — $200 per Qualifying Property; ƒ On-demand pump or point-of source water heater as part of an Instant-Access Hot Water System — $100 per component, to a maximum of two components per Qualifying Property; ƒ Multi-Family Dwelling Meter Split — $100/dwelling unit; ƒ Smart Irrigation Controller — $100 with four stations. Additional $10 available per station up to twenty (20) stations;

Appendix G – Energy Conservation G-5 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ƒ One or more Soil Moisture Sensor(s) on a conventional automatic Irrigation System — $25 per sensor;
ƒ Cistern water tanks — $50 per 100 gallons of water storage capacity (up to 500 gallons) in a Cistern, then $25 per 100 gallons of water storage capacity up to a maximum storage capacity of 25,000 gallons per Qualifying Property. Sites must have sufficient roof area to fill Cistern and may require an inspection;
ƒ Lawn removal and replacement with low water use plants or permeable surfaces — $1.00 per square-foot to a maximum of 2,500 square-feet per Qualifying Property. Pre-qualification, inspections and deed restrictions are required;
ƒ Rotating Sprinkler Nozzles (minimum purchase and installation of ten) — $4.00 per nozzle; ƒ Graywater Irrigation System supplied by one Clothes Washer for irrigation — $100. A site inspection is required by Building Inspector and/or MPWMD; and ƒ Graywater Irrigation System supplied by one or more Bathrooms that have a Bathtub/Shower connected to a Graywater Irrigation System — $100 per Bathroom. (Residential limit: 4) A site inspection is required by Building Inspector and/or MPWMD.

As part of the 6th Cycle Housing Element Update process, the City of Carmel-by-the-Sea will continue to implement a Water Conservation program that supports the MPWMD and also provides information to the community on water conservation retrofits and best practices.

Federal and State Programs
The Low-Income Home Energy Assistance Program (LIHEAP) is a federally funded program to assist low-income households that pay a high portion of their income on energy needs. LIHEAP is funded by the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Community Services.
ƒ The Home Energy Assistance Program (HEAP) provides one-time financial assistance to help balance an eligible household's utility bill;
ƒ The Energy Crisis Intervention Program (ECIP) provides assistance to low-income households that are in a crisis situation. Such an example would be a household receiving a 24-48 hour disconnect notice or service termination by their utility company. Another example would be a household facing an energy-related crisis that could be deemed potentially life-threatening in the household, such as a combustible appliance;
ƒ LIHEAP Weatherization provides free energy efficiency upgrades to low-income households to lower their monthly utility bills while also improving the health and safety of the household's occupants;

Appendix G – Energy Conservation G-6 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 ƒ Education on basic energy efficiency practices and instruction on the proper use and maintenance of installed weatherization measures; and
ƒ Energy budget counseling.

The Inflation Reduction Act (IRA) has provided significant federal funding to support electrification of new construction, renovations, and existing buildings over the next ten years. Enhanced amounts are provided for income-qualified residents. Support provided by IRA includes:

New Home Construction Tax Credits (single family or multi-unit) ƒ Up to $2,500 tax credit if meets Energy Star certification requirements; ƒ Up to $5,000 tax credit if meets Zero Energy Ready Homes certification requirements; and ƒ Tax credit is "per unit" for multifamily developments; maximum tax credit requires conformance with prevailing wage requirements.

Home Improvement Tax Credits (for households with tax liability) ƒ 30 percent of project cost, capped at $2,000 for heat pump installation and $1,200 for other energy efficiency appliances and improvements; and
ƒ Available January 2023 through 2032; tax credits can be claimed on a per year basis.

Home Improvement Tax Rebates (for low and moderate-income households) ƒ Rebates up to $14,000 depending on income for heat pumps, induction and electric ranges, and other energy efficient improvements; and
ƒ Available Fall 2023 through 2032.

Home Renewable Power Tax Credits
ƒ 30 percent of project cost for installation of solar panels, battery storage, and any other renewable power source on property;
ƒ Example: $19,000 to install rooftop solar panels generates $5,700 tax credit; and ƒ Retroactive to 2022, full credit sunsets in 2032; then 22 percent credit expires in 2035.

The Property Assessed Clean Energy (PACE) Financing program enables property owners to secure upfront funding for energy efficiency, water efficiency, renewable energy, and seismic improvement projects. These improvements are repaid through an up to 20-year special line item on their property taxes instead of traditional consumer credit.

The City includes programs in the 6th Cycle Housing Element to promote energy conservation and green building and to actively disseminate information about State and Federal programs.

Appendix G – Energy Conservation G-7 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Energy and Resource
Conservation Need
Programmatic Action
Energy Efficiency Program 2.4.A: Housing Rehabilitation and Maintenance Information Program 4.1.B: Energy Conservation and Green Building
Water Conservation Program 4.1.A: Water Conservation

Appendix G – Energy Conservation G-8 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 This side intentionally left blank.

Stakeholder Survey H

APPENDIX

Table of Contents
APPENDIX H STAKEHOLDER SURVEY .......................................................................... H-1 H.1 Stakeholder Survey ................................................................................................................ H-1 Attachments
Attachement A Stakeholder Survey Questions
Attachment B Open-ended Responses

Appendix H -- Stakeholder Survey H-1 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Appendix H
Stakeholder Survey
H.1 Stakeholder Survey
The Housing Element Stakeholder Survey was conducted from May 24, 2023 to July 6, 2023 to provide residents, business owners, visitors, and people working in Carmel-by-the-Sea with an opportunity to share input on what housing needs exist in Carmel-by-the-Sea and to share ideas on how the City can achieve its Regional Housing Needs Allocation (RHNA). The survey consisted of 21 questions designed to inform the City of what demographics exist in the City, what the affordable housing needs are, and how the 6th Cycle Housing Element can best meet these affordable housing needs. The survey was conducted in both English and Spanish. The survey was available online at the Carmel-by-the-Sea Housing Element page (homecarmelbythesea.com).

City of Carmel-by-the-Sea staff shared information about how to take the survey during the June 15, 2023 joint City Council and Planning Commission meeting. The survey was also distributed throughout town to local businesses in an effort to reach groups who are not typically represented, including people who work in Carmel-by-the-Sea. A total of 156 survey responses were received in English and 1 response was received in Spanish.

The survey responses discussed below represent responses from an uncontrolled sample size of selfselected community members who are considered to be motivated and interested in the 6th Cycle Housing Element. This can make it difficult to draw conclusions based on the responses received.

The following serves as a brief summary of the responses received.

Online Survey Results
Respondent Demographics
The City collected a total of 157 responses to the survey. As shown in Figure 1 below, survey respondent ages range from 18 to 75 years and older. The fewest survey responses were collected from respondents ages 18-34 (3 percent) and the majority of the survey responses collected were from respondents ages 55-74 (87 percent). This indicates an underrepresentation of younger community members in the survey results, and indicates a need for additional future outreach to target these groups.

Appendix H -- Stakeholder Survey H-2 EMC Planning Group Carmel-by-the-Sea 6th Cycle Housing Element Update Adopted April 8, 2024 Of the respondents, 74 percent identified as non-Hispanic White and 50 percent of the respondents identified as earning above $100,000. Thirty-one percent of survey respondents preferred not to disclose their annual income. In general, the majority of survey respondents are between the ages of 55-74, are non-Hispanic White, and earn over $100,000.
1%
2%
8%
8%
24%
26%
31%
0% 5% 10% 15% 20% 25% 30% 35%
$0-$25,000
$25,001-$50,000
$75,001-$100,000
$50,001-$75,000
$200,000 or more
$100,001-$200,000
Prefer not to say
Figure 2: "What is your annual household income?"
1%
3%
4%
16%
22%
55%
0% 10% 20% 30% 40% 50% 60%
35-54, 55-74
Prefer not to say.
18-34
75+
35-54
55-74
Figure 1: "How old are you?"