Hermosa Beach City Council
June 14, 2022

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RESOLUTION NO. 22-XXXX
RESOLUTION ADOPTING A LIST OF PROJECTS FOR FISCAL YEAR 2022-23 FUNDED BY SB 1: THE ROAD REPAIR AND ACCOUNTABILITY ACT OF 2017 WHEREAS, Senate Bill 1 (SB 1), the Road Repair and Accountability Act of 2017 (Chapter 5, Statutes of 2017) was passed by the Legislature and Signed into law by the Governor in April 2017 to address the significant multi-modal transportation funding shortfalls statewide; and
WHEREAS, SB 1 includes accountability and transparency provisions that will ensure the residents of the City of Hermosa Beach are aware of the projects proposed for funding in our community and which projects have been completed each fiscal year; and WHEREAS, the City of Hermosa Beach must adopt by resolution a list of projects proposed to receive fiscal year funding from the Road Maintenance and Rehabilitation Account (RMRA), created by SB 1, which must include a description and the location of each proposed project, a proposed schedule for the project’s completion, and the estimated useful life of the improvement; and
WHEREAS, the City of Hermosa Beach, will receive an estimated $444,633 in RMRA funding in Fiscal Year 2022-23 from SB 1; and
WHEREAS, this is the sixth year in which the City of Hermosa Beach is receiving SB 1 funding and will enable the City of Hermosa Beach County to continue essential road maintenance and rehabilitation projects, safety improvements, repairing and replacing aging bridges, and increasing access and mobility options for the traveling public that would not have otherwise been possible without SB 1; and
WHEREAS, the City of Hermosa Beach has undergone a robust public process to ensure public input into our community’s transportation priorities/the project list; and WHEREAS, the City of Hermosa Beach used a Pavement Management System to develop the SB1 project list to ensure revenues are being used on the most high-priority and cost-effective 350

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projects that also meet the communities priorities for transportation investment. The projects placed on the SB1 list for Fiscal Year 2022-23 involves the rehabilitation of a street with a Pavement Condition Index (PCI) ranging from 34 to 68; and
WHEREAS, the funding from SB1 will help the City of Hermosa Beach maintain and rehabilitate various streets and sidewalks throughout the City of Hermosa Beach this year and similar projects in the future; and
WHEREAS, the 2020 California Statewide Local Streets and Roads Needs Assessment found that the City of Hermosa Beach’s streets and roads are in an At Risk condition and this revenue will help us increase the overall quality of our road system and over the next decade will bring our streets and roads into Good condition; and
WHEREAS, the SB 1 project list and overall investment in our local streets and roads infrastructure with a focus on basic maintenance and safety, investing in complete streets infrastructure, and using cutting-edge technology, materials and practices, will have significant positive co-benefits statewide. Without revenue from SB1, the City of Hermosa Beach would have to otherwise delay projects throughout the community.

NOW, THEREFORE, IT IS HEREBY RESOLVED, ORDERED, AND FOUND by the City Council of the City of Hermosa Beach, state of California, as follows:

1. The foregoing recitals are true and correct.

2. The following list in Attachment 2 of newly proposed projects will be funded in-part or solely with Fiscal Year 2022-23 Road Maintenance and Rehabilitation Account revenues.

PASSED AND ADOPTED by the City Council of the City of Hermosa Beach, State of California this 14 day of June, 2022, by the following vote:
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VOTE: AYES:

NOES:

ABSTAIN:

ABSENT:

PASSED, APPROVED and ADOPTED this 14 day of June, 2021. ______________________________________________________________________________________________ PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, California ATTEST: APPROVED AS TO FORM:

City Clerk City Attorney
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Agency Contact:

Lucho Rodriguez(310) 318‐0210
LoCode: 5155 [email protected]
Pre‐ Construction
Construction Min. Max.

CIP 143 PCH Mobility Improvement
Project
This project is to improve accessibility, mobility and safety along the Pacific Coast Highway corridor.

Pacific Coast Highway within City limits 7/21/2021 10/30/2027 15 30 CIP 160 PCH Traffic Improvements
This project improves operational mobility along Pacific Coast Highway. The project also includes improvements including but not restricted to truck turning radius, ADA curb ramps, striping and pedestrian signal improvements.

Pacific Coast Highway and 14th St
7/21/2021 10/30/2022 10 20
CIP 188 Strand Bikeway and Walkway
Improvements at 35th Street
This project would provide improved accessibility and connectivity for bicyclists travelling between the Cities of Hermosa Beach and Manhattan Beach via The Strand at 35th Street.

Hermosa Ave and 35th St
7/1/2022 6/1/2026 15 30
CIP 191 Annual Street Improvements
This project proposes pavement rehabilitation of streets at various locations. The project will also address limited quantities of deteriorated concrete sidewalk, curb and gutter, curb ramps and drainage deficiencies.
7th St From Pacific Coast Highway To Prospect Ave
Bonnie Brae St From Aviation Blvd To 16th St
Joy St From Campana St To Bonnie Brae St
Campana St From Joy St To Prospect Ave
15th St From Pacific Coast Highway To Ocean Dr
Owosso Ave From Aviation Blvd To 14th St
Corona St From Aviation Blvd To 14th St
17th St From Prospect Ave To End
Golden Ave From 16th St To End
24th Pl From Valley Dr To South Park
14th St From Prospect Ave To Pacific Coast Highway
Borden Ave From 21st St To End
Alley From Rhodes St To 20th St
Alley From 21st St To 20th StCypress From 6th To End
Prospect Ave
7/1/2022 6/1/2023 10 20
CIP 195 City Sidewalk Improvements
This project provides repairs, replacements, and improvements to sidewalks throughout the City at various locations to maintain and improve safety.

Hermosa Ave From 13th St To 14th Ct
34th St From Hermosa Ave To Palm Dr
Valley Park Ave From 18th St To End
11th St From Hermosa Ave To Beach Dr
7/1/2022 10/30/2022 10 20
STATE OF CALIFORNIA • CALIFORNIA TRANSPORTATION COMMISSION Senate Bill (SB) 1 Proposed Project List Form
Local Streets and Roads Program
Agency Name: FYHermosa Beach
22/23
Summary of Proposed Project List
ProjectNo.

Project Title Project Description Project Location
Estimated Completion Date
(mm/dd/yyyy)
Estimated
Useful Life (#
of yrs)
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City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0355
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022

ADOPT A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH,

CALIFORNIA, DECLARING A DROUGHT CRITICAL CONDITION AND IMPLEMENTING DROUGHT RESPONSE LEVEL 2 CONSERVATION MEASURES PURSUANT TO HERMOSA BEACH MUNICIPAL CODE SECTION 8.56.090
(Environmental Programs Manager Doug Krauss)
Recommended Action:

Staff recommends City Council adopt a resolution declaring a Drought Critical Condition and implementing specified Level 2 conservation measures, pursuant to Hermosa Beach Municipal Code Chapter 8.56.090.

Executive Summary:

Due to persistent Statewide drought conditions, the Governor declared emergency water use restrictions and directed water purveyors to also implement restrictions. Local agencies are encouraged to implement restrictions to ensure consistent communication and enforcement strategies. The Hermosa Beach Municipal Code (HBMC) identifies drought restriction measures that can be approved by Council to address such conditions. The proposed resolution (Attachment 2) would ensure that the City’s strategies are consistent with those of the local water purveyor and the Governor’s Executive Order N-7-22 (Attachment 1).

Background:

On March 28, 2022, Governor Gavin Newsom issued Executive Order N-7-22 reiterating conservation measures issued in 2021 (Attachment 1). The order was issued in response to the ongoing drought conditions affecting much of the State. Executive Order N-7-22 requires local water purveyors to implement water shortage contingency plans and calls upon all Californians to limit indoor and outdoor water usage in the coming months.

On May 24, 2022, the State Water Board adopted an emergency regulation set to take effect on or around June 10, 2022. The emergency regulation reiterates prohibitions on overwatering of trees and watering of decorative grass with potable water. It also explicitly requires water purveyors to implement their Level 2 water reduction measures and implores other agencies to follow the requirements of local water suppliers. The emergency regulation will remain in effect for one year City of Hermosa Beach Page 1 of 3 Printed on 6/9/2022
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from the effective date, unless the State Water Board acts to end, modify, or readopt it.

Past Council Actions
Meeting Date Description
August 26, 2014 Approved Resolution Declaring Drought Emergency Conditions
Discussion:

Drought response Level 2 is declared when a water use reduction of 10-20 percent is required. A reduction is accomplished primarily through restricting landscape and lawn irrigation to no more than two days per week, and not more than 15 minutes per watering station or area. These restrictions are implemented in addition to the many permanent water conservation measures already in place per the City’s Drought Management Plan, detailed in Chapter 8.56 of the Hermosa Beach Municipal Code. These include a variety of ongoing conservation requirements such as:
· Prohibition of watering between 9:00 a.m. and 6:00 p.m.; · Prohibition of ornamental fountains that do not utilize water recycling or re-circulation; · Requirement of restaurants to provide water only upon request; · Restrictions on certain outdoor cleaning activities; and · Requirements for new buildings to install water-efficient devices.

The City also has a variety of ongoing water conservation measures already in place for its facilities and parks. Once such measure is the use of reclaimed water at its largest green areas including:

Valley Park; South Park; Clark Field; and the Greenbelt. Though reclaimed water use is not subject to conservation requirements, the City utilizes smart controllers and reduced watering schedules to reduce reclaimed water use at these facilities. The City utilizes smart irrigation controllers for most of its parks and green areas and would work with its landscaping contractor to adjust irrigation schedules to align with these new restrictions.

Staff is currently working with CalWater and West Basin Municipal Water District to identify potential turf replacement opportunities and to perform an assessment of the City’s facilities to identify other equipment replacements or adjustments to increase conservation.

The declaration of the Level 2 drought response also gives the City greater enforcement ability for these prohibited activities. If the resolution is adopted, staff would work with the City’s water purveyor, California Water Service (CalWater), to coordinate overall messaging to the community. CalWater has already begun extensive messaging to its customers and City staff would utilize its various outreach tools and media to augment this messaging. City staff would also add a feature to the GoHermosa app to allow users to report violations of these drought restrictions. The State offers a City of Hermosa Beach Page 2 of 3 Printed on 6/9/2022
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GoHermosa app to allow users to report violations of these drought restrictions. The State offers a portal at savewater.ca.gov for reporting water waste, which could be shared through the City’s outreach efforts.

The Level 2 drought restrictions would remain in place until City Council approves a resolution ending the declaration. City staff would monitor the ongoing drought conditions and communicate with CalWater, as well as State and regional agencies, to determine when an end to the declaration is appropriate.

General Plan Consistency:

This report and associated recommendations have been evaluated for their consistency with the City’s General Plan. Relevant Policies are listed below:

Sustainability and Conservation Element
Goal 5. Water conservation practices, recycled water use, and innovative water technologies support a resource efficient community.

Policies:
· 5.3 Water conservation programs. Update and improve water conservation and efficiency programs, requirements, and incentives on a regular basis. · 5.4 Conservation behavior. Maximize water conservation and efficiency upgrades through education, regulation, and incentives covering every aspect of water use Fiscal Impact:

There are no fiscal impacts associated with the recommended action.

Attachments:

1. Executive Order N-7-22

2. Draft Resolution

3. Link to August 26, 2014 Staff Report
Respectfully Submitted by: Douglas Krauss, Environmental Program Manager Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
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EXECUTIVE DEPARTMENT

STATE OF CALIFORNIA
EXECUTIVE ORDER N-7-22
WHEREAS on April 12, 202 l, May l 0, 2021, July 8, 202 l, and October 19, 2021, I proclaimed states of emergency that continue today and exist across all the counties of California, due to extreme and expanding drought conditions; and
WHEREAS climate change continues to intensify the impacts of droughts on our communities, environment, and economy, and California is in a third consecutive year of dry conditions, resulting in continuing drought in all parts of the State; and
WHEREAS the 21st century to date has been characterized by record warmth and predominantly dry conditions, and the 2021 meteorological summer in California and the rest of the western United States was the hottest on record; and
WHEREAS since my October 19, 2021 Proclamation, early rains in October and December 2021 gave way to the driest January and February in recorded history for the watersheds that provide much of California's water supply; and WHEREAS the ongoing drought will have significant, immediate impacts on communities with vulnerable water supplies, farms that rely on irrigation to grow food and fiber, and fish and wildlife that rely on stream flows and cool water; and
WHEREAS the two largest reservoirs of the Central Valley Project, which supplies water to farms and communities in the Central Valley and the Santa Clara Valley and provides critical cold-water habitat for salmon and other anadromous fish, have water storage levels that are approximately l .1 million acre-feet below last year's low levels on this date; and WHEREAS the record-breaking dry period in January and February and the absence of significant rains in March have required the Department of Water Resources to reduce anticipated deliveries from the State Water Project to 5 percent of requested supplies; and
WHEREAS delivery of water by bottle or truck is necessary to protect human safety and public health in those places where water supplies are disrupted; and
WHEREAS groundwater use accounts for 41 percent of the State's total water supply on an average annual basis but as much as 58 percent in a critically dry year, and approximately 85 percent of public water systems rely on groundwater as their primary supply; and
WHEREAS coordination between local entities that approve permits for new groundwater wells and local groundwater sustainability agencies is important to achieving sustainable levels of groundwater in critically overdrafted basins; and
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WHEREAS the duration of the drought, especially following a multiyear drought that abated only five years ago, underscores the need for California to redouble near-, medium-, and long-term efforts to adapt its water management and delivery systems to a changing climate, shifting precipitation patterns, and water scarcity; and
WHEREAS the most consequential, immediate action Californians can take to extend available supplies is to voluntarily reduce their water use by 15 percent from their 2020 levels by implementing the commonsense measures identified in operative paragraph 1 of Executive Order N-10-21 (July 8, 2021 ); and
WHEREAS to protect public health and safety, it is critical the State take certain immediate actions without undue delay to prepare for and mitigate the effects of the drought conditions, and under Government Code section 8571, I find that strict compliance with various statutes and regulations specified in this Proclamation would prevent, hinder, or delay the mitigation of the effects of the drought conditions.

NOW, THEREFORE, I, GAVIN NEWSOM, Governor of the State of California, in accordance with the authority vested in me by the State Constitution and statutes, including the California Emergency Services Act, and in particular, Government Code sections 8567, 8571, and 8627, do hereby issue the following Order to become effective immediately:

IT IS HEREBY ORDERED THAT:

1. The orders and provisions contained in my April 21, 2021, May 10, 2021, July 8, 2021, and October 19, 2021 Proclamations remain in fu ll force and effect, except as modified by those Proclamations and herein.

State agencies shall continue to implement all directions from those Proclamations and accelerate implementation where feasible.

2. To help the State achieve its conservation goals and ensure sufficient water for essential indoor and outdoor use, I call on all Californians to strive to limit summertime water use and to use water more efficiently indoors and out. The statewide Save Our Water conservation campaign at SaveOurWater.com provides simple ways for Californians to reduce water use in their everyday lives. Furthermore, I encourage Californians to understand and track the amount of water they use and measure their progress toward their conservation goals.

3. By May 25, .2022, the State Water Resources Control Board (Water Board) shall consider adopting emergency regulations that include all of the following:
a. A requirement that each urban water supplier, as defined in section 10617 of the Water Code, shall submit to the Department of Water Resources a preliminary annual water supply and demand assessment consistent with section 10632.1 of the Water Code no later than June 1, 2022, and submit a final annual water 358
supply and demand assessment to the Department of Water Resources no later than the deadline set by section 10632.1 of the Water Code;
b. A requirement that each urban water supplier that has submitted a water shortage contingency plan to the
Department of Water Resources implement, at a minimum, the shortage response actions adopted under section 10632 of the Water Code for a shortage level of up to twenty percent (Level 2), by a date to be set by the Water Board; and
c. A requirement that each urban water supplier that has not submitted a water shortage contingency plan to the
Department of Water Resources implement, at a minimum,
shortage response actions established by the Water Board, which shall take into consideration model actions that the Department of Water Resources shall develop for urban water supplier water shortage contingency planning for Level 2, by a date to be set by the Water Board.

To further conserve water and improve drought resiliency if the drought lasts beyond this year, I encourage urban water suppliers to conserve more than required by the emergency regulations described in this paragraph and to voluntarily activate more stringent local requirements based on a shortage level of up to thirty percent (Level 3).

4. To promote water conservation, the Department of Water Resources shall consult with leaders in the commercial, industrial, and institutional sectors to develop strategies for improving water conservation, including direct technical assistance, financial assistance, and other approaches. By May 25, 2022, the Water Board shall consider adopting emergency regulations defining "non-functional turf" (that is, a definition of turf that is ornamental and not otherwise used for human recreation purposes such as school fields, sports fields, and parks) and banning irrigation of non-functional turf in the commercial, industrial, and institutional sectors except as it may be required to ensure the health of trees and other perennial non-turf plantings.

5. In order to maximize the efficient use of water and to preserve water supplies critical to human health and safety and the environment, Public Resources Code, Division 13 (commencing with section 21000) and regulations adopted pursuant to that Division are hereby suspended, with respect to the directives in paragraphs 3 and 4 of this Order and any other projects and activities for the purpose of water conservation to the extent necessary to address the impacts of the drought, and any permits necessary to carry out such projects or activities. Entities that desire to conduct activities under this suspension, other than the directives in paragraphs 3 and 4 of this Order, shall first request that the Secretary of the Natural Resources Agency make a determination that the proposed activities are eligible to be conducted under this suspension. The Secretary shall use sound discretion in applying this Executive Order to ensure that the suspension serves the purpose of accelerating conservation projects that are necessary to address impacts of the drought, while at the same time 359
protecting public health and the environment. The entities implementing these directives or conducting activities under this suspension shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

6. To support voluntary approaches to improve fish habitat that would require change petitions under Water Code section 1707 and either Water Code sections 1425 through 1432 or Water Code sections 1725 through 1732, and where the primary purpose is to improve conditions for fish, the Water Board shall expeditiously consider petitions that add a fish and wildlife beneficial use or point of diversion and place of storage to improve conditions for anadromous fish. California Code of Regulations, title 23, section 1064, subdivisions ( a) ( 1) (A) (i)-(ii) are suspended with respect to any petition that is subject to this paragraph.

7. To facilitate the hauling of water for domestic use by local communities and domestic water users threatened with the loss of water supply or degraded water quality resulting from drought, any ordinance, regulation, prohibition, policy, or requirement of any kind adopted by a public agency that prohibits the hauling of water out of the water's basin of origin or a public agency's jurisdiction is hereby suspended. The suspension authorized pursuant to this paragraph shall be limited to the hauling of water by truck or bottle to be used for human consumption, cooking, or sanitation in communities or residences threatened with the loss of affordable safe drinking water.

Nothing in this paragraph limits any public health or safety requirement to ensure the safety of hauled water.

8. The Water Board shall expand inspections to determine whether illegal diversions or wasteful or unreasonable use of water are occurring and bring enforcement actions against illegal diverters and those engaging in the wasteful and unreasonable use of water. When access is not granted by a property owner, the Water Board may obtain an inspection warrant pursuant to the procedures set forth in Title 13 (commencing with section 1822.50) of Part 3 of the Code of Civil Procedure for the purposes of conducting an inspection pursuant to this directive.

9. To protect health, safety, and the environment during this drought emergency, a county, city, or other public agency shall not:
a. Approve a permit for a new groundwater well or for alteration of an existing well in a basin subject to the Sustainable
Groundwater Management Act and classified as medium- or high-priority without first obtaining written verification from a Groundwater Sustainability Agency managing the basin or area of the basin where the well is proposed to be located that groundwater extraction by the proposed well would not be inconsistent with any sustainable groundwater management program established in any applicable Groundwater
Sustainability Plan adopted by that Groundwater Sustainability 360
Agency and would not decrease the likelihood of achieving a sustainability goal for the basin covered by such a plan; or b. Issue a permit for a new groundwater well or for alteration of an existing well without first determining that extraction of groundwater from the proposed well is (1) not likely to interfere with the production and functioning of existing nearby wells, and (2) not likely to cause subsidence that would adversely impact or damage nearby infrastructure.

This paragraph shall not apply to permits for wells that will provide less than two acre-feet per year of groundwater for individual domestic users, or that will exclusively provide groundwater to public water supply systems as defined in section 116275 of the Health and Safety Code.

10. To address household or small community drinking water shortages dependent upon groundwater wells that have failed due to drought conditions, the Department of Water Resources shall work with other state agencies to investigate expedited regulatory pathways to modify, repair, or reconstruct failed household or small community or public supply wells, while recognizing the need to ensure the sustainability of such wells as provided for in paragraph 9.

11. State agencies shall collaborate with tribes and federal, regional, and local agencies on actions related to promoting groundwater recharge and increasing storage.

12. To help advance groundwater recharge projects, and to demonstrate the feasibility of projects that can use available high water flows to recharge local groundwater while minimizing flood risks, the Water Board and Regional Water Quality Control Boards shall prioritize water right permits, water quality certifications, waste discharge requirements, and conditional waivers of waste discharge requirements to accelerate approvals for projects that enhance the ability of a local or state agency to capture high precipitation events for local storage or recharge, consistent with water right priorities and protections for fish and wildlife. For the purposes of carrying out this paragraph, Division 13 (commencing with section 21000) of the Public Resources Code and regulations adopted pursuant to that Division, and Chapter 3 ( commencing with section 85225) of Part 3 of Division 35 of the Water Code and regulations adopted pursuant thereto are hereby suspended to the extent necessary to address the impacts of the drought. This suspension applies to (a) any actions taken by state agencies, (b) any actions taken by local agencies where the state agency with primary responsibility for the implementation of the directives concurs that local action is required, and (c) permits necessary to carry out actions under (a) or (b). The entities implementing these directives shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

13. With respect to recharge projects under either Flood-Managed Aquifer Recharge or the Department of Water Resources Sustainable 361
Groundwater Management Grant Program occurring on open and working lands to replenish and store water in groundwater basins that will help mitigate groundwater conditions impacted by drought, for any (a) actions taken by state agencies, (b) actions taken by a local agency where the Department of Water Resources concurs that local action is required, and (c) permits necessary to carry out actions under (a) or (b), Public Resources Code, Division 13 (commencing with section 21000) and regulations adopted pursuant to that Division are hereby suspended to the extent necessary to address the impacts of the drought. The entities implementing these directives shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

14. To increase resilience of.state water supplies during prolonged drought conditions, the Department of Water Resources shall prepare for the potential creation and implementation of a multi-year transfer program pilot project for the purpose of acquiring water from willing partners and storing and conveying water to areas of need.

15. By April 15, 2022, state agencies shall submit to the Department of Finance for my consideration proposals to mitigate the worsening effects of severe drought, including emergency assistance to communities and households and others facing water shortages as a result of the drought, facilitation of groundwater recharge and wastewater recycling, improvements in water use efficiency, protection of fish and wildlife, mitigation of drought-related economic or water-supply disruption, and other potential investments to support short- and long-term drought response.

IT IS FURTHER ORDERED that as soon as hereafter possible, this Order be filed in the Office of the Secretary of State and that widespread publicity and notice be given of this Order.

This Order is not intended to, and does not, create any rights or benefits, substantive or procedural, enforceable at law or in equity, against the State of California, its agencies, departments, entities, officers, employees, or any other person.

IN WITNESS WHEREOF I have hereunto set
my hand and caused the Great Seal of the
State of California to be affixed this 28th
day of March 2022.

I I
,:, .
l · I'
t (.1 I
l~~-~-- GAVIN NEWSOM
Governor of California
ATTEST:

SHIRLEY N. WEBER, PH.D.

Secretary of State
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65270.00001\40087803.2

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WHEREAS, the Governor of California has declared a drought emergency proclamation and the City of Hermosa Beach’s (the “City”) water provider, California Water Service, has implemented Stage 2 of its Water Shortage Contingency Plan and informed customers of certain of certain water use prohibitions; and
WHEREAS, the City enacted Chapter 8.56 of the Hermosa Beach Municipal Code in order to increase the conservation and efficient use of potable water, maximize the use of recycled water, and provide a drought management plan for the City; and
WHEREAS, the City further enacted Chapter 8.56 in order to reduce water consumption and extend available water supplies in the City, minimize the effects and hardship of water shortages on the City and the general public to the greatest extent possible, and maximize the socioeconomic and environmental benefits associated therewith; and
WHEREAS, in order to maintain consistency with the State’s emergency proclamation, in congruence with the City’s vision of an environmentally sustainable community, and to ensure customers are provided a consistent message, it is appropriate and necessary that the water users within the city increase their water conservation.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES HEREBY RESOLVE AS FOLLOWS:

SECTION 1. Pursuant to Hermosa Beach Municipal Code Section 8.56.090, the City Council declares a Drought Response Level 2, “Drought Critical Condition” and invokes all provisions of Response Level 2 of Chapter 8.56 applicable to all persons using potable water.

RESOLUTION NO. 22-XXXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH,

CALIFORNIA, DECLARING A DROUGHT CRITICAL CONDITION AND
IMPLEMENTING DROUGHT RESPONSE LEVEL 2 CONSERVATION MEASURES PURSUANT TO HERMOSA BEACH MUNICIPAL CODE SECTION 8.56.090 363
65270.00001\40087803.2

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SECTION 2. This Resolution shall take effect immediately. The City Clerk shall certify to the passage and adoption of this Resolution, shall cause the original of the same to be entered among the original resolutions of the City Council, and shall make a minute of the passage and adoption thereof in the minutes of the City Council meeting at which the same is passed and adopted.

PASSED, APPROVED and ADOPTED this 14th day of June, 2022. ____________________________________________________________________ PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, California ATTEST: APPROVED AS TO FORM:
____________________________ ____________________________ Myra Maravilla Mike Jenkins
City Clerk City Attorney
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From: Karen Nickelson
To: City Clerk
Subject: Need Hermosa Beach Water Restrictions
Date: Tuesday, June 14, 2022 1:51:53 PM
Hello,
Regarding the drought in Southern California, will you kindly provide Hermosa Beach’s latest water restrictions applicable to the address below?
2162 Circle Drive, Hermosa Beach, CA 90254
Please advise on:

What are the landscape watering days?
Watering times?
Watering duration?
Restrictions for residential pools?
Thank you!
Best regards,
Karen Nickelson
Level Four Business Management, LLC
Message Disclaimer: The content of this e-mail is intended solely for the use of the Individual or entity to whom it is addressed. If you have received this communication in error, be aware that forwarding it, copying it, or in any way disclosing its content to any other person, is strictly prohibited. If you have received this communication in error, please notify the author by replying to this e-mail immediately.
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City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0359
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022
PARTICIPATION IN BEACH CITIES TRANSIT (BCT) LINE 109

AGREEMENT, WITH NO REQUIRED FINANCIAL CONTRIBUTION
FROM THE CITY FOR FISCAL YEAR 2022-2023, WITH THE CITIES

OF EL SEGUNDO, MANHATTAN BEACH AND REDONDO BEACH,

FUNDED FROM PROPOSITION A FUNDS
(Interim Community Development Director Angela Crespi)
Recommended Action:

Staff recommends City Council:

1. Approve participation for one year along with the other beach cities, with no required financial contribution from the City for Fiscal Year 2022-2023; and

2. Direct the Mayor to sign the Agreement on behalf of the City.

Executive Summary:

The Beach Cities Transit (BCT) Line 109 provides service for a portion of former Line 439 that was discontinued by Metro in 2006. Since that time, Hermosa Beach along with the cities of El Segundo, Manhattan Beach, and Redondo Beach have participated in a cost-share agreement to provide funding for BCT Line 109 operation. BCT Line 109 route runs from Redondo Beach Riviera Village to LAX City Bus Center. The City of Redondo Beach is a municipal transit operator and annually receives dedicated transit funds under the Formula Allocation Procedures (FAP), which incorporates transit performance data to allocate transit funding. The Los Angeles County Metropolitan Transportation Authority (MTA) allocates the FAP funds, consisting of dedicated Proposition A and C, Measure R and Measure M funds, in addition to other dedicated transit funding, to the municipal transit operators. BCT Line 109 is funded through this combination of regional FAP transit funds, fare revenues from riders, and dedicated Proposition A Local Return Transportation Funds. Redondo Beach estimates BCT Line 109 would be fully funded by the dedicated transit funding and other State funds.

Background:

On July 1, 2006, Redondo Beach and Hermosa Beach entered into a Transit Service Operation Agreement to enable BCT Line 109 to take over public transportation services for the discontinued Los Angeles County MTA Line 439 for a two-year term. Redondo Beach and Hermosa Beach subsequently entered into new agreements relating to Line 109 in 2008, 2010, 2011, 2012, 2013, 2015, 2017, 2019, 2020, and 2021. The 2021 Agreement is set to expire on June 30, 2022, and the City of Hermosa Beach Page 1 of 5 Printed on 6/9/2022
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REPORT 22-0359
participating cities desire to enter into a new agreement on the terms and conditions set forth in the attached agreement.

The Agreement would be effective as of July 1, 2022 and would have a one-year term expiring on June 30, 2023. There is not a need for City fund contribution for FY 2022-2023.

Past Council Actions
Meeting Date Description
June 22, 2021 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
May 26, 2020 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
May 28, 2019 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
June 15, 2017 Approval of participation in Beach Cities Transit (BCT) Line 109 two-year agreement
June 9, 2015 Approval of participation in Beach Cities Transit (BCT) Line 109 two-year agreement
June 25, 2013 Approval of participation in Beach Cities Transit (BCT) Line 109 two-year agreement
June 16, 2012 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
April 26, 2011 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
July 27, 2010 Approval of participation in Beach Cities Transit (BCT) Line 109 one-year agreement
November 25, 2008 Approval of participation in Beach Cities Transit (BCT) Line 109 two-year agreement
June 1, 2006 Approval of participation in Beach Cities Transit (BCT) Line 109 two-year agreement
Analysis:

BCT initially estimated the FAP fund sources would fully cover the operating expenses and costs associated with the installation of Real-Time Information (RTI) capital equipment and systems, and related operation expenses. Therefore, the City’s contribution for FY 2022-23 would be $0.

Coronavirus disease 2019 (COVID-19) impacted BCT services; however, as of July 2021, BCT has City of Hermosa Beach Page 2 of 5 Printed on 6/9/2022
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REPORT 22-0359
resumed regular services including late night trips. BCT also resumed front door boarding and rear door exiting in 2021 as health orders allowed. Collection of fares is not being enforced at this time and ridership on Line 109 continues to remain low. The ridership between July 2021 and April 2022 was 112,352, which is approximately 65 percent of pre-COVID ridership.

Staff continues to monitor ridership, and COVID-19 emergency orders by the Redondo Beach City Manager, Los Angeles County, and the State to determine future BCT service schedules. Public notices and all updates regarding the service modifications were provided to the beach cities partners, posted on the Beach Cities Transit webpage and on Twitter @RedondoBeachBCT.

Redondo Beach awarded a new agreement to Transportation Concepts, Inc. on May 5, 2020 for Fiscal Years 2020-2021 through 2022-2023 with an option to extend two years through Fiscal Year 2024-25. The new agreement with Transportation Concepts would increase service costs. However, Redondo Beach would have reduced Compressed Natural Gas (CNG) fuel costs, due to the new CNG fueling station that was recently installed at the Redondo Beach public works yard. While the impacts of COVID-19 on dedicated transit funding for the next year are still being determined, BCT would receive an allocation of the Federal Coronavirus Aid, Relief and Economic Security (CARES) Act, and the American Rescue Plan Act for funding to assist with the funding of COVID-19 related expenses such as operations, cleaning and supplies, and lost revenue.

BCT would fully fund the operating expenses incurred by the transit contractor, and fuel expenses.

Operating expenses are incorporated in the service hour rates and include without limitation, driver wages, general administration and overhead, and maintenance costs. In addition, BCT awarded a contract to GMV Syncromatics to provide Real-Time Information (RTI) services on the transit buses and has installed Real-Time Information (RTI) capital equipment and systems, and related operation expenses. The system has been operational since September 2020. RTI System expenses include without limitation, capital equipment, passenger/administration interface programs, cellular and internet hosting of RTI services and report management programs. RTI allows passengers to receive real-time, up-to-date transit information provided by vehicle GPS tracking to predict when the next vehicle would arrive at any given transit stop, thereby reducing wait times and the reliance on schedules. This system improves customer service, increases customer satisfaction, and improves visibility of transit in the community. RTI can be received through phone, website, smartphone applications, and SMS text messaging. RTI is also available to users of Google Maps which would include live arrival and departure times to bus stops and service alerts.

Redondo Beach continues moving forward with enhancing future public transit in the South Bay region. Construction of the new transit center, located at 1521 Kingsdale Avenue in Redondo Beach, is anticipated to be completed fall of this year. The transit center is planned to be operational late 2022. It would include 12 bus bays, a passenger waiting area, automated transit ticket machine, driver operator lounge, bike facilities, and 339 parking spaces. The transit center would be a major transit connection, served by Metro, Torrance Transit, GTrans, Lawndale Beat, and BCT. In addition, this location is under consideration as a rail stop for the Metro Green Line Rail Extension.

General Plan Consistency:

This report and associated recommendation have been evaluated for their consistency with the City’s General Plan. Relevant Policies are listed below:

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Mobility Element
Goal 1. Complete Streets that serve the diverse functions of mobility, commerce, recreation, and community engagement for all users whether they travel by walking, bicycling, transit, or driving.

Policy:
· 1.1 Consider all modes. Require the planning, design, and construction of all modes of travel to create safe, livable and inviting environments for all users of the system.

Goal 3. Public rights-of-way supporting a multimodal and people-oriented transportation system that provides diversity and flexibility on how users choose to be mobile.

Policy:
· 3.4 Access opportunities. Provide enhanced mobility and access opportunities for local transportation and transit services in areas of the city with sufficient density and intensity of uses, mix of appropriate uses, and supportive bicycle and pedestrian network connections that can reduce vehicle trips within the city’s busiest corridors.

Fiscal Impact:

Currently, there are no funding shortfalls for the transit service, therefore Redondo Beach is not requesting a City contribution for FY 2022-2023. Since there is no contribution required for FY 2022- 2023, there is no corresponding request to Council to appropriate Proposition A funds for BCT Line 109 in the 2022-23 Preliminary Budget for BCT Line 109.

BCT Line 109 Cost Sharing Estimates Discussion for Fiscal Year 2022-2023 The estimated annual operating cost to operate regular service for BCT Line 109 is approximately $1,665,000. The services would be funded by Relief and Economic Security (CARES) Act, Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA), American Rescue Plan Act (ARPA), and Proposition A Local Return Funds.

In the past BCT Line 109 budget estimates have been provided, however due to the COVID-19 impacts on service hour operations, fare revenues, and FAP and Local Return Funding, the FY 2022- 23 budget estimates are uncertain. While BCT would also receive Federal CARES Act funding, the fund distribution estimates have not been finalized by MTA at the time of this report. Redondo Beach would provide an estimated budget when the information becomes available.

Agreement Request
Request Amount FY 2022-23 Budget Dept. Account # Total Contract Amount $0 145-3412-4251 $0
Attachments:

1. Transit Service Operation Agreement for Fiscal Year 2022-2023 Respectfully Submitted by: Carlos Luis, Senior Planner
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Concur: Angela Crespi, Interim Community Development Director Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
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1 TRANSIT SERVICE OPERATION AGREEMENT

BETWEEN THE CITY OF REDONDO BEACH AND

THE CITY OF HERMOSA BEACH
THIS TRANSIT SERVICE OPERATION AGREEMENT (this “Agreement”) is entered into by and between the City of Redondo Beach (“Redondo Beach”), on behalf of Beach Cities Transit (“BCT”), which is a division of Redondo Beach, and the City of Hermosa Beach (“Hermosa Beach”).

RECITALS
A. WHEREAS, on July 1, 2006, Redondo Beach and Hermosa Beach entered into that certain Transit Service Operation Agreement (“First Agreement”) to enable BCT Line 109 as described in Attachment A to take over public transportation services for the discontinued LACMTA Line 439 for a two (2) year term.

B. WHEREAS, Redondo Beach and Hermosa Beach subsequently entered into new agreements relating to Line 109 in 2008, 2010, 2011, 2012, 2013, 2015, 2017, 2019, 2020, and 2021 (the "2021 Agreement").

C. WHEREAS, the 2021 Agreement expires on June 30, 2022, and the parties desire to enter into a new agreement on the terms and conditions set forth below.

NOW THEREFORE, IN CONSIDERATION OF THE MUTUAL PROMISES
CONTAINED HEREIN, THE PARTIES AGREE AS FOLLOWS:

1. TERM
This Agreement shall be effective as of July 1, 2022, and shall have a one (1) year term expiring on June 30, 2023. Hermosa Beach acknowledges that an agreement in similar form to this Agreement or an amendment may be negotiated for continued Line 109 service beyond June 30, 2023. In the event Hermosa Beach intends to renew this Agreement, Hermosa Beach shall notify Redondo Beach of its intent to renew at least 182 days prior to the expiration of this term.

2. SERVICE DESCRIPTION
A. Redondo Beach shall operate Line 109 consistent with the maps shown in Attachment A, which is attached hereto and by this reference incorporated herein ("Line 109" or the "Service").

B. Redondo Beach shall operate Line 109 on the days of the week, service times and days, and frequencies of service equal to or better than that which was operated by BCT immediately prior to the effective date of this Agreement. The service schedules for Line 109, as illustrated in Attachment B is attached hereto and by this reference incorporated herein.
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2 C. Redondo Beach may adjust the route and schedule of Line 109; however, any changes or reductions to the Service in excess of 10% shall be brought to Hermosa Beach in writing for review and comment prior to implementation.

D. Redondo Beach reserves its rights, at its sole discretion, to enter into contracts for Line 109 service with any other provider of its choice at any time without the approval of Hermosa Beach. Redondo Beach shall be responsible for any and all aspects of administration of the service contract, and shall assure that the contract includes provisions pertaining to insurance, age, maintenance and operation of vehicles, driver qualifications and other similar provisions typical of an agreement of that kind.

E. Redondo Beach shall base the percentage of cost for Line 109 on the route service mile calculations, as illustrated in the attached Attachment C.

3. PASSENGER FARES
Redondo Beach may charge fares for the Service consistent with their existing fixedroute service. Redondo Beach will accept interagency transfers with adjacent transit operators and participate in the EZ Pass Program. Redondo Beach shall retain all farebox revenues. BCT Line 109 passenger fare revenues shall be used to offset operation expenses.

4. FUNDING
A. For costs associated with the operation of Line 109, Hermosa Beach shall pay Redondo Beach in accordance with this Section. Hermosa Beach shall not pay Redondo Beach for capital costs nor shall Hermosa Beach provide equipment to operate the Service.

B. FY 2022-23: Funding from Hermosa Beach shall be $0 for fiscal year 2022-23.

Service operating expenses are incorporated in the service hour rates and include without limitation, driver wages, general administration and overhead, and maintenance costs. The calculation for these estimated costs shall be in accordance with the Management Agreement for the Operation and Maintenance of Beach Cities Transit Fixed Route Transit Between the City of Redondo Beach and Parking Concepts, Inc. dba Transportation Concepts. The estimated revenues shall be based on the LACMTA funding formula and the prior fiscal year’s fare revenues for Line 109.

Real Time Information (“RTI”) system operating expenses include without limitation, capital equipment, passenger/administration interface programs, cellular and internet hosting of RTI services and report management programs.

C. Redondo Beach is responsible for all marketing and promotion of the service.

Notwithstanding the foregoing, Hermosa Beach may advertise at its sole expense, but any reference to BCT must be approved in writing by Redondo Beach prior to such reference. Only the BCT logo may be used to advertise or market the service. 372
3 D. On a quarterly basis, BCT will meet with Hermosa Beach to develop additional marketing strategies directed towards increasing BCT Line 109 ridership.

Hermosa Beach shall provide assistance for public outreach and information to target Hermosa Beach residents and non-resident community members.

5. REPORTING/INVOICING
A. Redondo Beach shall report to Hermosa Beach on a quarterly basis, all of the following data for the Line 109 Service:
(1) Passengers carried
(2) Revenue hours operated
(3) Revenue miles operated
(4) Total operating costs, including service operating expenses and RTI capital and operating expenses
B. Redondo Beach shall submit said report to the Hermosa Beach City Manager in writing within fifteen (15) days after the end of each reporting quarter.

C. Redondo Beach shall submit quarterly reports to the Hermosa Beach City Manager.

D. Redondo Beach shall incorporate Line 109 data into its Federal Transit Administration’s National Transit Data (NTD) annual report for the entire BCT fixed route transportation system. Redondo Beach shall provide to Hermosa Beach annual NTD random sampling data which provides the statistics to estimate the number of passengers boarding and alighting by stop in Hermosa Beach, and the total estimated Hermosa Beach passengers. Redondo Beach shall be responsible for any and all aspects of administration of the service contract, and shall include provisions pertaining to insurance.

E. Hermosa Beach retains the right to audit the BCT’s records of Line 109 Service, and to periodically monitor the Service.

F. Redondo Beach shall schedule quarterly joint meetings with the partnering cities of El Segundo, Hermosa Beach, and Manhattan Beach. Redondo Beach will provide a quarterly update of Line 109 services, and discuss coordinated marketing and public outreach efforts and operating and financing issues that affect BCT services.

6. INSPECTION OF RECORDS
BCT records relevant to this Agreement shall be available for inspection by Hermosa Beach at all reasonable times for a period of at least three (3) years for each year or after the termination date, whichever comes first.

7. NON-DISCRIMINATION
No person shall on the grounds of race, color, religion, national origin, ancestry, age, sex, physical or mental disability, be excluded from participation in, or be subject to discrimination in the operation of the Line 109 Service. 373
4 8. COORDINATION
A. Redondo Beach shall coordinate its BCT services, to the extent practical, so that passengers transferring between transit operators will have minimal waiting times.

This coordination will require transit agencies to communicate with each other as many weeks as possible in advance of any planned schedule change to the services that may affect passenger transfers.

B. The Hermosa Beach Project Manager for this project shall be the City Manager or his/her designee. BCT coordinator for this project shall be the Community Services Director or his/her designee.

9. WAIVER OF BREACH
The waiver of each party of any breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach of that same or any other provision.

10. NOTICES
A. All notices, requests, demands, or other communications under this Agreement shall be in writing. Notice shall be given as follows:
(1) Personal Delivery. Personally delivered to the recipient. Notice is effective on delivery.
(2) First Class Mail. First class to the last address of the recipient known to the party giving notice. Notice is effective three mail delivery days after deposit in a United States Postal Service office or mailbox.
(3) Certified Mail. Certified mail with return receipt requested. Notice is effective on receipt, if delivery is confirmed by a return receipt. (4) Overnight Delivery. Delivered by an overnight delivery service, charges prepaid or charged to the sender’s account. Notice is effective on delivery, if delivery is confirmed by the delivery service.
(5) Email. Sent by email to the last email address of the recipient known to the party giving notice. Notice is effective upon receipt.

Any notice given by email shall be deemed received on the next business day if it is received after 5:00 p.m. (recipient’s time) or on a non-business day.

Addresses for purpose of giving notice shall be as follows:

Beach Cities Transit: City of Redondo Beach
Transit Operations and Transportation Facilities Manager 374
5 Attention: Line 109
415 Diamond Street
Redondo Beach, CA 90277
Email: [email protected]
With a copy to: City of Redondo Beach
The City Clerk’s Office
415 Diamond Street
Redondo Beach, CA 90277-2836
Email: [email protected]
City of Hermosa Beach: City of Hermosa Beach
Community Development Director
1315 Valley Drive
Hermosa Beach, CA 90254-3885
Attention: Angela Crespi
Email: [email protected]
With a copy to: City Clerk
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach, CA 90254-3885
Email: [email protected]
B. Any correctly addressed notice that is refused, unclaimed, or undeliverable because of an act or omission of the party to be notified, shall be deemed effective as of the first date the notice was refused, unclaimed or deemed undeliverable by the postal authorities, messenger or overnight delivery service.

C. Either party may change its address or email address number by giving the other party written notice of the change.

11. SEVERABILITY
Should any part, term or provision of this Agreement or any document required herein to be executed be declared invalid, void or unenforceable, all remaining parts, terms and provisions hereof shall remain in full force and effect and shall in no way be invalidated, impaired or affected thereby.

12. INTEGRATION; AMENDMENT
This Agreement represents the entire understanding of Hermosa Beach and Redondo Beach as to those matters contained in it. No prior oral or written understanding shall 375
6 be of any force or effect with respect to the subject matter hereof. The Agreement may not be modified or altered except by written amendment executed by both parties.

13. INTERPRETATION
The terms of this Agreement should be construed in accordance with the meaning of the language used and should not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction that might otherwise apply.

14. GOVERNING LAW; JURISDICTION
This Agreement will be administered and interpreted under the laws of the State of California. Jurisdiction of any litigation arising from the Agreement will be in Los Angeles County, California.

15. COMPLIANCE WITH STATUTES AND REGULATIONS
BCT will be knowledgeable of and will comply with all applicable federal, state, county and city statutes, rules, regulations, ordinances and orders.

16. NON-LIABILITY OF CITIES
No officer or employee of either city shall be personally liable to the other, in the event of any default or breach thereunder.

17. INDEMNIFICATION
Each party hereby agrees to defend, protect, indemnify and hold harmless the other party, its officers, employees, volunteers, agents, elected and appointed officials, and members of boards and commissions from and against any and all loss, damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, and judgments, including reasonable attorney’s fees, expert fees and costs of suit arising directly or indirectly from or in any manner related to or in connection with or caused by the performance or failure of the party, its agents, servants or employees to perform the services required of the party’s employees under the terms of this Agreement.

18. AUTHORITY
Each party warrants that the individuals who have signed this Agreement have the legal power, right and authority to enter into and execute this Agreement on behalf of each respective party.

SIGNATURES FOLLOW ON NEXT PAGE
376
7 IN WITNESS WHEREOF, the parties have executed this Agreement in Redondo Beach, California, as of this ____ day of ________, 2022.

CITY OF REDONDO BEACH CITY OF HERMOSA BEACH
By: ______________________________ By: ______________________________ William C. Brand, Mayor Michael Detoy, Mayor

APPROVED AS TO FORM: APPROVED AS TO FORM:
______________________________ ______________________________ Michael W. Webb, City Attorney Michael Jenkins, City Attorney ATTEST: ATTEST:
______________________________ ______________________________ Eleanor Manzano, City Clerk Myra Maravilla, City Clerk

377
8 Attachment A: Line 109 Map
378
9 Attachment B: BCT Line 109 Time Schedule

379
10 Attachment C
Beach Cities Transit Line 109
Route Service Mile Calculations by City
Route Miles NB Miles SB Miles Average
Miles Per
City
Allocation
Formula %
Redondo Beach & Los Angeles 5.3 6.9 6.1 34.95%
Hermosa Beach 2.2 1.6 1.90 10.89%
Manhattan Beach 3.4 2.2 2.8 16.05%
El Segundo 7.7 5.6 6.65 38.11%
Total Miles 18.6 16.3 17.45 100.00%
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382
383
384
385
386
387
388
389
390
391
392
393
394
395
396
397
398
399
400
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City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0371
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022
ADOPTION OF FISCAL YEAR 2022-23 BUDGET
(Finance Director Viki Copeland)
Recommended Action:

Staff recommends City Council:

1. Receive public testimony regarding the Fiscal Year 2022-23 Budget (Attachment 1);

2. Approve contracts for services contained in the table herein;

3. Approve the revisions to the Preliminary Budget as shown on pages 5-6; and

4. Adopt a Resolution approving the 2022-23 Budget as presented in Exhibit A (Attachment 2).

Executive Summary:

Staff recommends a transfer of $1,313,107 from the American Rescue Plan Act Fund to the General Fund to balance the budget and the use of unspent funds of $3,232,145 from the prior fiscal year towards funding goals established in the City’s Financial Policies and Capital Improvement Projects (CIPs). The end result is a 2022-23 budget that includes: a Contingency (Rainy Day Fund) of $7,307,026, or 16 percent of appropriations per the City’s adopted financial policy; restores staffing levels to pre-pandemic levels; and adds additional essential staff, supplemental requests, and capital projects that would continue to move the City forward towards its established goals.

Background:

On April 21, 2022, a study session was held for the 2022-23 Capital Improvement Program to review the 50 projects and studies proposed for the upcoming fiscal year. The 2022-23 Capital Improvement Program totals $23.5 million, which includes $12.9 million in estimated carryover funds from 2021-22.

An additional four Public Works staff are included in the budget and would be funded from CIP funds in order to advance the existing backlog of CIP projects, and new project requests.

The City utilized an interactive online budget document for the second year. A budget workshop was held on June 2, 2022. Responses to Councilmember questions and requests may be found in the analysis section. A summary of the General Fund is also provided (Attachment 3 ).

Past City Council Actions
Meeting Date Description
April 21, 2022 City Council held the 2022–23 Capital Improvement Program Study Session
June 2, 2022 City Council held the 2022–23 Budget Workshop City of Hermosa Beach Page 1 of 9 Printed on 6/9/2022
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Past City Council Actions
Meeting Date Description
April 21, 2022 City Council held the 2022–23 Capital Improvement Program Study Session
June 2, 2022 City Council held the 2022–23 Budget Workshop Analysis:

The chart below shows the steps taken to balance the budget:

Revenue 46,454,415
Transfers In 419,382
Appropriations (44,884,724)
Transfers Out (1,385,860)
Changes to Fund Balance (273,686)
Total General Fund Balance Projected for 6/30/23 329,527 Changes in Appropriations
Supplemental Requests (626,582)
Position Requests (319,038)
Change in Fund Balance Reserves
Changes to Contingency Balances (822,014)
Use General Plan Maintenance Fees 125,000
Transfer In
American Rescue Plan Act Fund 1,313,107
Balance Projected for 6/30/2023 0
Recommended Use of 2020-21 Unspent Funds
Unassign 2020-21 Unused Fund Balance 5,834,252
Increase Compensated Absences to 25% Goal (18,362)
Transfer to Insurance Fund for Goal of $3 Million Balance (278,031) Transfer to Equipment Replacement Fund for Funding Goal (333,645) Transfer to Capital Improvement Fund (2,602,107)
Assign in General Fund for 2023-24 Budget (2,602,107)
Remaining 2020-21 Unspent Funds 0
General Fund Summary of Budget Balancing Actions for 2022-23 City of Hermosa Beach Page 2 of 9 Printed on 6/9/2022
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Revenue 46,454,415
Transfers In 419,382
Appropriations (44,884,724)
Transfers Out (1,385,860)
Changes to Fund Balance (273,686)
Total General Fund Balance Projected for 6/30/23 329,527 Changes in Appropriations
Supplemental Requests (626,582)
Position Requests (319,038)
Change in Fund Balance Reserves
Changes to Contingency Balances (822,014)
Use General Plan Maintenance Fees 125,000
Transfer In
American Rescue Plan Act Fund 1,313,107
Balance Projected for 6/30/2023 0
Recommended Use of 2020-21 Unspent Funds
Unassign 2020-21 Unused Fund Balance 5,834,252
Increase Compensated Absences to 25% Goal (18,362)
Transfer to Insurance Fund for Goal of $3 Million Balance (278,031) Transfer to Equipment Replacement Fund for Funding Goal (333,645) Transfer to Capital Improvement Fund (2,602,107)
Assign in General Fund for 2023-24 Budget (2,602,107)
Remaining 2020-21 Unspent Funds 0
General Fund Summary of Budget Balancing Actions for 2022-23 Staff recommends City Council approve the following actions to balance the 2022-23 Budget as shown in Attachment 3, Exhibit A.
· Adopt estimated revenue of $46,454,415 and revised transfers in of $1,732,489 that includes City of Hermosa Beach Page 3 of 9 Printed on 6/9/2022 powered by Legistar™404
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REPORT 22-0371
· Adopt estimated revenue of $46,454,415 and revised transfers in of $1,732,489 that includes a one-time transfer as outlined below.
· Transfer $1,313,107 from the American Rescue Plan Act (ARPA) Fund to the General Fund. At a high level, American Rescue Plan Act funds have the following eligible uses:

1. COVID-19 or a negative economic impact;

2. Premium pay for eligible workers;

3. Government Services to the extent of the loss of revenue; or

4. Investments in water, sewer, and broadband infrastructure.

The proposed use of $1.3 million in the 2022-23 Budget would be used for the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency, with falls under eligible use category three above. This would leave $997,770 for future use. The covered period for eligible expenditures is March 21, 2021 to December 31, 2024.

Adopt revised appropriations of $45,830,343 and transfers out of $4,599,643, which includes the following staffing recommendations and supplemental requests:
· Add Essential Supplemental Requests of $626,582; and
· Add Position Requests/Frozen Positions of $319,038.

As a part of the Midyear Budget Review on March 8, 2022, staff recommended assigning the unspent General Funds from 2020-21 of $5,834,252 for the 2022-23 Budget process, at which time it would be determined if the funds need to remain in the General Fund or should transfer to meet funding goals, in accordance with the City’s financial policies.

Staff recommends that these unspent funds of $3,232,145 remaining from the 2020-21 Budget be used to meet funding goals in accordance with the City’s established Financial Policies and provide funding for current and future CIPs, as described in detail below:
· $18,362 to increase the assigned Compensated Absences balance to the funding goal of 25 percent of the accrued liability for employee vacation, sick, and compensatory time; · $278,031 to increase the Insurance Fund’s net position to the funding goal of $3 million for claims above recorded claims liabilities or catastrophic losses; · $333,645 to increase the Equipment Replacement Fund balance to the funding goal, which is to maintain net position equal to the accumulated amount calculated on the equipment replacement schedules for all equipment based on replacement cost and useful life; and · $2,602,107 to the Capital Projects Fund to fund 2022-23 Capital Improvement Projects (CIPs) and future CIP funding needs.

The remaining $2,602,107 from FY2020-21 would be reserved for use in the 2023-24 Budget.

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Adopt the changes to fund balance of -$2,243,082 as outlined in Attachment 3.

City Council Follow-up Items from June 2, 2022 Budget Workshop The following items are provided as follow-up to questions or requests at the Budget Workshop on June 2, 2022:

1. Cost of the new Ford F150 EV Lightning for the Police Department in the 2022 - 2023 Budget as compared to the Ford F150 EV for Community Services approved for purchase at the May 24, 2022 Council Meeting.

The Police Department requested two Ford F150 Lightning vehicles for specific needs.

One vehicle will be used for Patrol functions, including beach patrol. This vehicle requires the long-range battery and upgraded equipment that includes vehicle accessories, lighting, sirens, prisoner cage, and paint/badging.

The second vehicle will be used for Animal Control Services and the basic model allows employees to conduct their business as required. The equipment requirements for the Animal Control truck are minimal as well.

Both estimates are based off of vehicle factory quotes and cost estimates for needed equipment and installation.

2. More information requested related to new parking meters and the pay by app software.

Staff is currently finalizing the pay by app RFP and will negotiate a contract with the vendor in the near future. The pay by app integration will overlay with our current metering systems. Without any unforeseen delays, staff anticipates a contract being presented to City Council in approximately one month. Because Hermosa Beach is primarily within the Coastal Zone, a cash payment option for meters is strongly recommended to ensure equal access for all community members.

Police Chief Paul LeBaron will be prepared to address any questions.

Revisions to Preliminary Budget
The following revisions to the Preliminary Budget are recommended and reflected in the budget summary included with the budget resolution attachment. Other formatting and grammatical corrections would be made in the Adopted Budget that do not affect the amounts in the budget summary.

Equipment Replacement Fund
· Appropriate $69,118 for the purchase of the copiers as indicated in the Contracts for Services City of Hermosa Beach Page 5 of 9 Printed on 6/9/2022
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REPORT 22-0371
· Appropriate $69,118 for the purchase of the copiers as indicated in the Contracts for Services section that follows. The copiers were budgeted as leases originally and are now changed to purchases which are more advantageous.
· Reduce the Police Department’s Equipment less than $1,000 account, account 715-2101- 5401, by $49,831 due to an amount erroneously included in the 2022-23 Department Request; · Increase the Community Resources Equipment less than $1,000 account, account 715-4601- 5401, by $588 for an item from the Communications Equipment Replacement Schedule excluded in error.

The three changes noted above will result in a reduction in the total Equipment Replacement Fund appropriations of $19,875.

Contracts for Services
The following contracts are extensions of existing contracts except for replacement of the copiers.

Rather than submitting them individually on future agendas, they are included here for approval.

Comments regarding staff’s satisfaction with the current providers are included. The contracts are on file for review in the Finance Department.

DEPARTMENT/CONTRACTOR SERVICE PROVIDED TERM/AMOUNT
City Clerk
Granicus, LLC
7/1/22–6/30/23 - $77,415
Granicus provides managed services for meeting and agenda management, video streaming, citizen participation, and closed captioning. They have met the expectations of the contract.

The contract was executed June 11, 2019. This amendment will extend the agreement for one additional year to allow the department to explore what other software options exist.

Finance
Gruber and Lopez, Inc.

Gruber and Lopez, Inc. provides independent audit services for the Finance Department. They have met the expectations of the contract. The initial contract was executed May 28, 2019 for three years. The contract has an option for an additional two years.

City Manager
Canon Financial Services, Inc.
(Equipment) and Canon Solutions
America, Inc. (Maintenance)
Canon Financial Services Inc. and Canon Solutions America provides equipment and maintenance for multifunction copiers.

The City purchased copiers in 2013 which are outdated and replacement parts are no longer available for these machines.

Canon has met the expectations of the maintenance contract.

Staff recommends a purchase agreement. Utilizing a
cooperative piggy back contract (OMNIA - formerly National IPA) eliminates the need for a RFP which creates a cost savings. Equipment purchase; $86,906, estimated 60 month maintenance agreement: $57,998 (approximately $15,168
annually).
7/1/2022–6/30/23 - $102,074 for 2022-23
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Staff Report
REPORT 22-0371

DEPARTMENT/CONTRACTOR SERVICE PROVIDED TERM/AMOUNT
City Clerk
Granicus, LLC
7/1/22–6/30/23 - $77,415
Granicus provides managed services for meeting and agenda management, video streaming, citizen participation, and closed captioning. They have met the expectations of the contract.

The contract was executed June 11, 2019. This amendment will extend the agreement for one additional year to allow the department to explore what other software options exist.

Los Angeles Society For The
Prevention of Cruelty To Animals
(SPCALA)
SPCALA provides animal sheltering and disposal services for Community Services. They have meet the expectation of the contract. The initial contract was executed September 24, 2014 and the terms of service have been amended annually. 7/1/22–8/31/2023 - $12,300
Finance
Gruber and Lopez, Inc.

Gruber and Lopez, Inc. provides independent audit services for the Finance Department. They have met the expectations of the contract. The initial contract was executed May 28, 2019 for three years. The contract has an option for an additional two years.
7/1/22–6/30/2024 - $32,960 for 2022-23
Police Department
City Manager
Canon Financial Services, Inc.
(Equipment) and Canon Solutions
America, Inc. (Maintenance)
Canon Financial Services Inc. and Canon Solutions America provides equipment and maintenance for multifunction copiers.

The City purchased copiers in 2013 which are outdated and replacement parts are no longer available for these machines.

Canon has met the expectations of the maintenance contract.

Staff recommends a purchase agreement. Utilizing a
cooperative piggy back contract (OMNIA - formerly National IPA) eliminates the need for a RFP which creates a cost savings. Equipment purchase; $86,906, estimated 60 month maintenance agreement: $57,998 (approximately $15,168
annually).
7/1/2022–6/30/23 - $102,074 for 2022-23
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Staff Report
REPORT 22-0371
General Plan Consistency:

PLAN Hermosa, the City’s long-range planning document, was adopted by the City Council in August 2017, and envisions a future where “Hermosa Beach is the small town others aspire to be; a place where our beach culture, strong sense of community, and commitment to sustainability intersect.” One of the guiding principles to achieve the vision is to make decisions and take actions that help contribute to the City’s economic and fiscal stability.

Other relevant General Plan policies are listed below:

Governance Element
Goal 1. A high degree of transparency and integrity in the decision-making process.

Policies:
· 1.2 Strategic planning. Regularly discuss and set priorities at the City Council and management level to prioritize work programs and staffing needs. · 1.6 Long-term considerations. Prioritize decisions that provide long-term community benefit and discourage decisions that provide short-term community benefit but reduce long -term opportunities.

Parks and Open Space Element
Goal 1. First class, well maintained, and safe recreational facilities, parks and open spaces.

Policy:
· 1.1 Facility upgrades. Improve and update park and open space facilities on a regular basis.

Goal 2. Abundant parks, open space, and recreational facilities to serve the community.

Policy:
· 2.6 Investment and maintenance. Prioritize the investment and maintenance of existing facilities prior to development and expansion of new facilities.

Infrastructure Element
Goal 1. Infrastructure systems are functional, safe, and well maintained.

Policy:
· 1.2 Priority investments. Use City Council established priorities and the Capital Improvement Program (CIP) to identify and allocate funding for projects identified in the infrastructure plan.

Public Safety Element
Goal 5. High quality police and fire protection services provided to residents and visitors.

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REPORT 22-0371
Policy:
· 5.2 High level of response. Achieve optimal utilization of allocated public safety resources and provide desired levels of response, staffing, and protection within the community.

Fiscal Impact:

The recommendations contained in the Preliminary Budget continue to build upon the City’s recovery efforts and reflects investments in the community through the core resources of staff, infrastructure, and systems. The 2022-23 Budget, including all funds, estimates revenue of $60,376,490 and appropriations of $78,873,082, of which $23,452,610 is for Capital Improvement Projects with $12,853,433 carried forward from prior year Capital Improvement Projects.

Attachments:

1. Link to 2023-23 Preliminary Budget

2. Resolution of Budget Adoption, including Exhibit A-Budget Summary

3. Fiscal Year 2022-23 General Fund Summary

4. Link to April 21, 2022 CIP Study Session Staff Report

5. Link to June 2, 2022 Budget Workshop Staff Report
Respectfully Submitted by : Viki Copeland, Finance Director Legal Review : Mike Jenkins, City Attorney
Approved : Suja Lowenthal, City Manager
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CITY OF HERMOSA BEACH
RESOLUTION NO. 23-XXXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA ADOPTING THE BUDGET FOR THE FISCAL YEAR 2023–24 WHEREAS, a budget for the fiscal year 2023–24 has been prepared by the City Manager, and;
WHEREAS, said budget incorporates expenditures for operating purposes, capital outlay and capital improvement projects, and;
WHEREAS, said final budget will include the appropriations limit and total annual appropriations subject to limitation as required by Section 37200 of the Government Code, and;
WHEREAS, the City Council has examined said budget and, after due deliberation and consideration, has made such amendments to the budget as it deems advisable.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA, DOES HEREBY RESOLVE AS FOLLOWS:

SECTION 1. That the City Council does hereby approve and adopt the revised budget for the 2023–24 Fiscal Year as presented in the documents entitled “City of Hermosa Beach Budget Summary 2023–24”, and attached as “Exhibit A.”
SECTION 2. This Resolution shall take effect immediately. The City Clerk shall certify to the passage and adoption of this Resolution; shall enter the same in the book of original Resolutions; and shall make a minute of the passage and adoption thereof in the records of the proceedings of the City Council meeting at which the same is passed and adopted.

PASSED, APPROVED and ADOPTED on this 13th day of June, 2023.

Mayor Raymond A. Jackson
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA 411

ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Myra Maravilla, MPA, CMC Patrick Donegan,
City Clerk City Attorney
412
Major Fund Special Revenue Funds

LIGHTING

GENERAL LANDSCAPING STATE GAS

FUND FUND TAX FUND
001 105 115

ESTIMATED REVENUE
Taxes $38,301,815 $457,649 $0
Licenses/Permits $1,238,386 $0 $0
Fines/Forfeitures $1,747,450 $0 $0
Use of Money/Property $1,381,583 $4,347 $29,255
Intergovernmental/State $106,199 $0 $1,049,690
Intergovernmental/County $0 $0 $0
Intergovernmental/Federal $0 $0 $0
Current Service Charges $9,274,197 $0 $0
Other Revenue $68,621 $0 $0
TOTAL ESTIMATED REVENUE $52,118,251 $461,996 $1,078,945 INTERFUND TRANSFERS IN $1,727,688 $468,524 $0
ESTIMATED FUNDS AVAILABLE $53,845,939 $930,520 $1,078,945

FUND BALANCE
7/1/23 $15,543,370 $30,329 $1,309,457
TOTAL FUNDS AVAILABLE $69,389,309 $960,849 $2,388,402

APPROPRIATIONS
Operating Budget $49,895,086 $949,795 $50,000
Capital Outlay $58,725 $0 $0
Capital Improvements- PY $300,000 $0 $1,134,511
Capital Improvements $0 $0 840,000
TOTAL APPROPRIATIONS $50,253,811 $949,795 $2,024,511
INTERFUND TRANSFERS OUT $4,436,047 $11,054 $357,865
TOTAL APPROPRIATIONS/TRANSFERS OUT $54,689,858 $960,849 $2,382,376

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $14,699,451 (a) $0 $6,026 (a) CLASSIFICATIONS OF FUND BALANCE:

Restricted Previous Balance Current Balance
General Plan Maintenance Fee $0 $85,000
PEG Fees, Cable Franchise $145,593 $204,414
CASp Fees $57,613 $66,700
Marquee Donation $50,000 $50,000
Committed
In Lieu Fee/ Parking Facility $462,400 $462,400
Assigned
Contingencies $7,588,784 $9,979,017
Reserve for FEMA Claims $0 $1,030,568
20-21 Year End Balance $18,460 $0
21-22 Year End Balance $3,835,617 $0
Retirement Rate Stabilization $1,021,575 $1,021,575
Retirement Trust $829,060 $829,060
Compensated Absences $294,170 $294,170
2018-19 Prop A Fund Exchange- Engineer Funding $190,321 $58,546 21-22 Prop A Fund Exchange- Engineer $259,777 $128,001
22-23 Prop A Fund Exchange $490,000 $490,000
CIP Carry Forward $300,000 $0
$15,543,370 $14,699,451
Available Fund Balance 6/30/24 $0 $0 $6,026

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
1 Exhibit A
413
Special Revenue Funds
PROP A
AB 939 OPEN SPACE TYCO

FUND FUND FUND
117 121 122

ESTIMATED REVENUE
Taxes $0 $0 $0
Licenses/Permits $0 $0 $0
Fines/Forfeitures $0 $0 $0
Use of Money/Property $9,310 $0 $427,886
Intergovernmental/State $0 $0 $0
Intergovernmental/County $0 $96,123 $0
Intergovernmental/Federal $0 $0 $0
Current Service Charges $64,000 $0 $0
Other Revenue $0 $0 $0
TOTAL ESTIMATED REVENUE $73,310 $96,123 $427,886
INTERFUND TRANSFERS IN $0 $0 $0
ESTIMATED FUNDS AVAILABLE $73,310 $96,123 $427,886

FUND BALANCE
7/1/23 $298,722 $0 $2,298,999
TOTAL FUNDS AVAILABLE $372,032 $96,123 $2,726,885

APPROPRIATIONS
Operating Budget $138,526 $0 $0
Capital Outlay $0 $0 $0
Capital Improvements- PY $0 $0 $2,494,273
Capital Improvements $0 $0 $227,200
TOTAL APPROPRIATIONS $138,526 $0 $2,721,473
INTERFUND TRANSFERS OUT $0 $44,963 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $138,526 $44,963 $2,721,473

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $233,506 $51,160 $5,412
Available Fund Balance 6/30/24 $233,506 $51,160 $5,412

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
2 414
Special Revenue Funds

PARK/ BAYVIEW DRIVE

RECREATION DISTRICT ADMIN

FACILITY TAX EXPENSE

FUND FUND
125 135

ESTIMATED REVENUE
Taxes $0 $0
Licenses/Permits $0 $0
Fines/Forfeitures $0 $0
Use of Money/Property $12,700 $226
Intergovernmental/State $0 $0
Intergovernmental/County $0 $0
Intergovernmental/Federal $0 $0
Current Service Charges $0 $0
Other Revenue $60,966 $5,000
TOTAL ESTIMATED REVENUE $73,666 $5,226
INTERFUND TRANSFERS IN $0 $0
ESTIMATED FUNDS AVAILABLE $73,666 $5,226

FUND BALANCE
7/1/23 $352,697 $5,700
TOTAL FUNDS AVAILABLE $426,363 $10,926

APPROPRIATIONS
Operating Budget $0 $1,900
Capital Outlay $0 $0
Capital Improvements- PY $183,361 $0
Capital Improvements $240,000 $0
TOTAL APPROPRIATIONS $423,361 $1,900
INTERFUND TRANSFERS OUT $0 $3,000
TOTAL APPROPRIATIONS/TRANSFERS OUT $423,361 $4,900

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $3,002 $6,026
Available Fund Balance 6/30/24 $3,002 $6,026

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
3 415
Special Revenue Funds

BEACH DRIVE DISTRICT

ADMINISTRATIVE COMMUNITY / DEV PROPOSITION PROPOSITION

EXPENSE BLOCK GRANT A C

FUND FUND FUND
139 140 145 146

ESTIMATED REVENUE
Taxes $0 $0 $554,063 $459,580
Licenses/Permits $0 $0 $0 $0
Fines/Forfeitures $0 $0 $0 $0
Use of Money/Property $168 $0 $20,309 $64,869
Intergovernmental/State $0 $0 $0 $0
Intergovernmental/County $0 $0 $0 $0
Intergovernmental/Federal $0 $366,406 $0 $0
Current Service Charges $0 $0 $732 $0
Other Revenue $4,000 $0 $0 $0
TOTAL ESTIMATED REVENUE $4,168 $366,406 $575,104 $524,449 INTERFUND TRANSFERS IN $0 $0 $0 $0
ESTIMATED FUNDS AVAILABLE $4,168 $366,406 $575,104 $524,449

FUND BALANCE
7/1/23 $3,989 $3,192 $68,079 $1,633,248
TOTAL FUNDS AVAILABLE $8,157 $369,598 $643,183 $2,157,697

APPROPRIATIONS
Operating Budget $1,500 $0 $177,857 $300,000
Capital Outlay $0 $0 $0 $0
Capital Improvements- PY $0 $233,089 $0 $1,487,678
Capital Improvements $0 $133,317 $0 $200,000
TOTAL APPROPRIATIONS $1,500 $366,406 $177,857 $1,987,678 INTERFUND TRANSFERS OUT $2,500 $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $4,000 $366,406 $177,857 $1,987,678

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $4,157 $3,192 $465,326 $170,019 Available Fund Balance 6/30/24 $4,157 $3,192 $465,326 $170,019

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
4 416
Special Revenue Funds

MEASURE R MEASURE M MEASURE W GRANT

FUND FUND FUND FUND
147 148 149 150

ESTIMATED REVENUE
Taxes $344,685 $390,643 $157,832 $0
Licenses/Permits $0 $0 $0 $0
Fines/Forfeitures $0 $0 $0 $0
Use of Money/Property $14,237 $29,103 $8,254 $636,865
Intergovernmental/State $0 $0 $0 $0
Intergovernmental/County $0 $0 $0 $0
Intergovernmental/Federal $0 $0 $0 $0
Current Service Charges $0 $0 $0 $0
Other Revenue $0 $0 $0 $0
TOTAL ESTIMATED REVENUE $358,922 $419,746 $166,086 $636,865 INTERFUND TRANSFERS IN $0 $0 $0 $0
ESTIMATED FUNDS AVAILABLE $358,922 $419,746 $166,086 $636,865

FUND BALANCE
7/1/23 $627,357 $1,070,979 $335,262 $2,770,933
TOTAL FUNDS AVAILABLE $986,279 $1,490,725 $501,348 $3,407,798

APPROPRIATIONS
Operating Budget $0 $0 $0 $50,675
Capital Outlay $0 $0 $0 $0
Capital Improvements- PY $595,345 $678,750 $308,110 $3,162,300 Capital Improvements $300,000 $690,000 $167,000 $189,849 TOTAL APPROPRIATIONS $895,345 $1,368,750 $475,110 $3,402,824 INTERFUND TRANSFERS OUT $0 $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $895,345 $1,368,750 $475,110 $3,402,824

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $90,934 $121,975 $26,238 $4,974 Available Fund Balance 6/30/24 $90,934 $121,975 $26,238 $4,974

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
5 417
Special Revenue Funds

SUPPLEMENTAL

AIR QUALITY LAW ENFORCEMENT AMERICAN RESCUE

IMPROVEMENT SERVICES FEMA CARES ACT PLAN ACT

FUND FUND FUND FUND FUND
152 153 157 158 159

ESTIMATED REVENUE
Taxes $0 $128,805 $0 $0 $0
Licenses/Permits $0 $0 $0 $0 $0
Fines/Forfeitures $0 $0 $0 $0 $0
Use of Money/Property $3,507 $16,079 $0 $0 $0
Intergovernmental/State $25,000 $0 $0 $0 $0
Intergovernmental/County $0 $0 $0 $0 $0
Intergovernmental/Federal $0 $0 $0 $0 $0
Current Service Charges $0 $0 $0 $0 $0
Other Revenue $0 $0 $0 $0 $0
TOTAL ESTIMATED REVENUE $28,507 $144,884 $0 $0 $0
INTERFUND TRANSFERS IN $0 $0 $0 $0 $0
ESTIMATED FUNDS AVAILABLE $28,507 $144,884 $0 $0 $0

FUND BALANCE
7/1/23 $128,051 $485,706 ($ (1,030,568) $310,537 $997,769 TOTAL FUNDS AVAILABLE $156,558 $630,590 ($ (1,030,568) $310,537 $997,769

APPROPRIATIONS
Operating Budget $10,000 $128,090 $0 $0 $0
Capital Outlay $0 $61,000 $0 $0 $0
Capital Improvements- PY $0 0 $0 $0 $0
Capital Improvements $0 0 $0 $0 $0
TOTAL APPROPRIATIONS $10,000 $189,090 $0 $0 $0
INTERFUND TRANSFERS OUT $0 $0 $0 $310,537 $997,769
TOTAL APPROPRIATIONS/TRANSFERS OUT $10,000 $189,090 $0 $310,537 $997,769

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $146,558 $441,500 ($ (1,030,568) $0 $0 Available Fund Balance 6/30/24 $146,558 $441,500 ($ (1,030,568) $0 $0

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
6 418
Special Revenue Funds

ASSET SEIZURE/

SEWER STORM DRAIN FORFEITURE

FUND FUND FUND
160 161 170

ESTIMATED REVENUE
Taxes $0 $0 $0
Licenses/Permits $0 $0 $0
Fines/Forfeitures $0 $0 $0
Use of Money/Property $123,006 $93,191 $24,337
Intergovernmental/State $0 $0 $0
Intergovernmental/County $8,000 $0 $0
Intergovernmental/Federal $0 $0 $0
Current Service Charges $1,196,842 $0 $0
Other Revenue $0 $0 $0
TOTAL ESTIMATED REVENUE $1,327,848 $93,191 $24,337
INTERFUND TRANSFERS IN $0 $700,000 $0
ESTIMATED FUNDS AVAILABLE $1,327,848 $793,191 $24,337

FUND BALANCE
7/1/23 $3,670,459 $2,619,535 $627,630
TOTAL FUNDS AVAILABLE $4,998,307 $3,412,726 $651,967

APPROPRIATIONS
Operating Budget $582,929 $521,215 $7,480
Capital Outlay $0 $0 $600
Capital Improvements- PY $2,653,406 $2,139,525 $0
Capital Improvements 278,540 - $0
TOTAL APPROPRIATIONS $3,514,875 $2,660,740 $8,080
INTERFUND TRANSFERS OUT $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $3,514,875 $2,660,740 $8,080

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $1,483,432 $751,986 $643,887 Available Fund Balance 6/30/24 $1,483,432 $751,986 $643,887

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
7 419
Special Revenue Funds
RTI

FIRE RTI UNDERSEA CABLE

PROTECTION UNDERSEA CABLE TIDELANDS

FUND FUND FUND
180 190 191

ESTIMATED REVENUE
Taxes $0 $0 $0
Licenses/Permits $0 $0 $0
Fines/Forfeitures $0 $0 $0
Use of Money/Property $0 $266,194 $18,072
Intergovernmental/State $0 $0 $0
Intergovernmental/County $0 $0 $0
Intergovernmental/Federal $0 $0 $0
Current Service Charges $0 $0 $0
Other Revenue $9,794 $0 $0
TOTAL ESTIMATED REVENUE $9,794 $266,194 $18,072
INTERFUND TRANSFERS IN $0 $0 $0
ESTIMATED FUNDS AVAILABLE $9,794 $266,194 $18,072

FUND BALANCE
7/1/23 $0 $1,078,302 $590,082
TOTAL FUNDS AVAILABLE $9,794 $1,344,496 $608,154

APPROPRIATIONS
Operating Budget $0 $0 $0
Capital Outlay $0 $0 $0
Capital Improvements- PY $0 $813,484 $550,335
Capital Improvements $0 $290,000 55,000
TOTAL APPROPRIATIONS $0 $1,103,484 $605,335
INTERFUND TRANSFERS OUT $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $0 $1,103,484 $605,335

DEBT SERVICE PAYMENT
ESTIMATED FUND BALANCE 6/30/24 $9,794 $241,012 $2,819
Available Fund Balance 6/30/24 $9,794 $241,012 $2,819

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
8 420
Debt Service Fd Special Revenue Funds Agency Funds

GREENWICH BAYVIEW DRIVE LOWER PIER

CAPITAL VILLAGE N DISTRICT DISTRICT

LEASE REVENUE IMPROVEMENT UNDERGROUND REDEMPTION REDEMPTION

BOND FUND FUND UTILITIES FUND FUND
201 301 313 609 610

ESTIMATED REVENUE
Taxes $0 $0 $0 $0 $0
Licenses/Permits $0 $0 $0 $0 $0
Fines/Forfeitures $0 $0 $0 $0 $0
Use of Money/Property $0 $387,144 $0 $3,200 $122
Intergovernmental/State $0 $0 $0 $0 $0
Intergovernmental/County $0 $0 $0 $0 $0
Intergovernmental/Federal $0 $0 $0 $0 $0
Current Service Charges $0 $0 $0 $0 $0
Other Revenue $0 $0 $0 $0 $0
TOTAL ESTIMATED REVENUE $0 $387,144 $0 $3,200 $122
INTERFUND TRANSFERS IN $664,416 $883,499 $0 $0 $0
ESTIMATED FUNDS AVAILABLE $664,416 $1,270,643 $0 $3,200 $122

FUND BALANCE
7/1/23 $64,184 $13,547,754 $120,898 $170,922 $31,289
TOTAL FUNDS AVAILABLE $728,600 $14,818,397 $120,898 $174,122 $31,411

APPROPRIATIONS
Operating Budget $0 $0 $0 $0 $0
Capital Outlay $0 $181,836 $0 $0 $0
Capital Improvements- PY $0 $7,562,287 $0 $0 $0
Capital Improvements $0 2,841,938 $0 $0 $0
TOTAL APPROPRIATIONS $0 $10,586,061 $0 $0 $0
INTERFUND TRANSFERS OUT $0 $0 $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $0 $10,586,061 $0 $0 $0 DEBT SERVICE PAYMENT $728,600 $0 $0 $0 $0
ESTIMATED FUND BALANCE 6/30/24 $0 $4,232,336 $120,898 $174,122 $31,411 Reserved for New Corporate City Yard Construction $1,889,278 (with contingency)
Reserve for Capital Facilities $841,393
Available Fund Balance 6/30/24 $0 $1,501,665 $120,898 $174,122 $31,411

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
9 421
Agency Funds

BEACH DRIVE BEACH DRIVE MYRTLE LOMA

DISTRICT DISTRICT AVENUE DRIVE

REDEMPTION RESERVE ASSESSMENT ASSESSMENT

FUND FUND FUND FUND
611 612 617 618

ESTIMATED REVENUE
Taxes $0 $0 $0 $0
Licenses/Permits $0 $0 $0 $0
Fines/Forfeitures $0 $0 $0 $0
Use of Money/Property $1,288 $178 $0 $0
Intergovernmental/State $0 $0 $0 $0
Intergovernmental/County $0 $0 $0 $0
Intergovernmental/Federal $0 $0 $0 $0
Current Service Charges $0 $0 $0 $0
Other Revenue $0 $0 $0 $0
TOTAL ESTIMATED REVENUE $1,288 $178 $0 $0
INTERFUND TRANSFERS IN $0 $0 $0 $0
ESTIMATED FUNDS AVAILABLE $1,288 $178 $0 $0

FUND BALANCE
7/1/23 $81,415 $1,595 $46,762 $114,807
TOTAL FUNDS AVAILABLE $82,703 1,773 $46,762 $114,807

APPROPRIATIONS
Operating Budget $0 $0 $0 $0
Capital Outlay $0 $0 $0 $0
Capital Improvements- PY $0 $0 $0 $0
Capital Improvements
TOTAL APPROPRIATIONS $0 $0 $0 $0
INTERFUND TRANSFERS OUT $0 $0 $0 $0
TOTAL APPROPRIATIONS/TRANSFERS OUT $0 $0 $0 $0

ADJUST FUND BALANCE FOR

FIXED ASSET ADDITIONS
ESTIMATED FUND BALANCE 6/30/24 $82,703 $1,773 $46,762 $114,807 Available Fund Balance 6/30/24 $82,703 $1,773 $46,762 $114,807

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
10 422
Agency Fund Internal Service Funds

BAYVIEW

DRIVE EQUIPMENT

RESERVE INSURANCE REPLACEMENT TOTAL

FUND FUND FUND (MEMORANDUM
619 705 715 ONLY)

ESTIMATED REVENUE
Taxes $0 $0 $0 $40,795,072
Licenses/Permits $0 $0 $0 $1,238,386
Fines/Forfeitures $0 $0 $0 $1,747,450
Use of Money/Property $587 $0 $0 $3,576,017
Intergovernmental/State $0 $0 $0 $1,180,889
Intergovernmental/County $0 $0 $0 $104,123
Intergovernmental/Federal $0 $0 $0 $366,406
Current Service Charges $0 $3,593,757 $2,203,341 $16,332,869 Other Revenue $0 $0 $0 $148,381
TOTAL ESTIMATED REVENUE $587 $3,593,757 $2,203,341 $65,489,594 INTERFUND TRANSFERS IN $0 $0 $1,719,608 $6,163,735
ESTIMATED FUNDS AVAILABLE $587 $3,593,757 $3,922,949 $71,653,328

FUND BALANCE
7/1/23 $4,884 $3,188,754 $9,832,982 $63,787,369
TOTAL FUNDS AVAILABLE $5,471 $6,782,511 $13,755,931 $134,689,390

APPROPRIATIONS
Operating Budget $0 $3,826,809 $2,722,255 $59,364,117
Capital Outlay $0 $0 $1,050,969 $1,353,130
Capital Improvements- PY $0 $0 $0 $24,296,454
Capital Improvements $0 $0 $0 $6,452,844
TOTAL APPROPRIATIONS $0 $3,826,809 $3,773,224 $91,466,545 INTERFUND TRANSFERS OUT $0 $0 $0 $6,163,735
TOTAL APPROPRIATIONS/TRANSFERS OUT $0 $3,826,809 $3,773,224 $97,630,280 DEBT SERVICE PAYMENT $728,600
ADJUST FUND BALANCE FOR $1,050,969 $1,050,969
FIXED ASSET ADDITIONS 2
ESTIMATED FUND BALANCE 6/30/24 $5,471 $2,995,702 $11,033,676 $37,381,479 Designated Building Maintenance Funds $551,840
Investment in Fixed Assets $5,728,229
Assigned reserve for Police Department Radio Equipment/South Bay $30,000 Interoperability Project.

Records Technology Fee $754,186
Assigned reserve for Accounting ERP $333,645
Available Fund Balance 6/30/24 $5,471 $2,955,702 $3,635,776 $12,553,457

CITY OF HERMOSA BEACH BUDGET SUMMARY
Preliminary Budget
2023-24
11 423
City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0350
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022

PUBLIC HEARING-HERMOSA BEACH LANDSCAPING
AND STREET LIGHTING DISTRICT FISCAL YEAR 2022-2023
(Public Works Director Joe SanClemente)
Recommended Action:

Staff recommends City Council:

1. Conduct a public hearing in connection with the levy of assessments for Hermosa Beach Landscaping and Street Lighting District 2022-2023; and

2. Adopt a Resolution (Attachment 1) confirming the diagram and assessment found in the Engineer’s Report (Attachment 2) for Hermosa Beach Landscaping and Street Lighting District 2022-2023 and levying an assessment for the Fiscal Year beginning July 1, 2022 and ending June 30, 2023.

Executive Summary:

The Hermosa Beach Landscaping and Street Lighting District (District) collects funds for the maintenance and operation of the citywide street lighting program and landscaping within street medians and parkways. The District must be renewed annually by following a three-step process.

Staff recommends continuation of the process for Fiscal Year 2022-2023.

Background:

The District was created in Fiscal Year 1989-1990, pursuant to the Landscaping and Lighting Act of 1972 (Street and Highway Code Sections 22500-22679). The District assessment provides funding to maintain and operate streetlights, traffic signals, and landscaping located within parkways and medians citywide. The assessment rate has not increased since the passage of Proposition 218 in 1996 and is set at $41.45 per dwelling unit.

The District must be renewed annually by following a three-step process. First, Council authorizes the Director of Public Works to prepare an Engineer’s Report containing the estimated cost of maintaining the District, the list of parcels within the District, and the method of apportionment of the assessment. At its April 12, 2022 meeting, City Council adopted Resolution No. 22-7310 authorizing preparation of the Engineer’s Report. Second, the Engineer’s Report (Attachment 2) is presented to Council for approval and the Council sets a date for a public hearing declaring the City Council’s City of Hermosa Beach Page 1 of 4 Printed on 9/12/2022
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Council for approval and the Council sets a date for a public hearing declaring the City Council’s intention to order certain improvements and to levy and collect assessments within the District for the new fiscal year. At its May 10, 2022, Council adopted Resolution No. 22-7312 approving the Engineer’s Report and Resolution No. 22-7313 declaring the City’s intention to order certain improvements, to levy and collect assessments, and to set June 14, 2022 at 6:30 p.m. as the date and time for a public hearing. The notice of the public hearing was published in the Easy Reader on May 19, 2022.

The third and final step is to hold a public hearing to accept public input on the matter of the proposed assessment and, if approved, to levy the assessment for the new fiscal year.

Past Council Actions
Meeting Date Description
April 12, 2022 City Council adopted Resolution 22-7310 authorizing the preparation of an Engineer’s Report for the Landscaping and Street Lighting District.

May 10, 2022 City Council adopted Resolution 22-7312 approving the Engineer’s Report and Resolution 22-7313 declaring the
City’s intention to order certain improvements, to levy and collect assessments, and to set June 14, 2022 as the date for a public hearing.

Analysis:

The Hermosa Beach Landscaping and Street Lighting District partially funds the maintenance and operation of the citywide street lighting program and landscaping within street medians and parkways. The City is in compliance with Proposition 218 and can continue to levy assessments without balloting requirements so long as the assessments are not increased. The assessment rate per dwelling unit has not increased since the passage of Proposition 218 in 1996 and will continue at the rate of $41.45 per dwelling unit in Fiscal Year 2022-2023.

The Council is now considering the third, and final, step in the process to hold the public hearing. If approved, the City would levy an assessment for the Fiscal Year beginning July 1, 2022 and ending June 30, 2023.

The total assessment anticipated to be collected for Fiscal Year 2022-2023 is $461,300. The difference between what is collected through the assessment and what is needed to operate the District next fiscal year would be subsidized. An additional amount of $239,245 from the RTI Undersea Cable Fund and $1,590 from the Tyco Fund would be transferred to the Landscaping and Street Lighting District Fund to maintain the District for the upcoming fiscal year.

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An additional $25,000 is included in the FY 2022-2023 Preliminary Budget to study the District rates and to consider creating a new supplemental district. The study will seek to address the annual operating deficit, so that no further subsidies from the General Fund or other discretionary funds would be required. Any proposed rate increase resulting from the study would be processed in compliance with Proposition 218.

General Plan Consistency:

This report and associated recommendation have been evaluated for their consistency with the City’s General Plan. Relevant Policies are listed below:

Mobility Element
Goal 2. A public realm that is safe, comfortable, and convenient for travel via foot, bicycle, public transit, and automobile and creates vibrant, people oriented public spaces that encourage active living.

Policies:
· 2.1 Prioritize public rights-of-way. Prioritize improvements of public rights-of-way that provide heightened levels of safe, comfortable and attractive public spaces for all non-motorized travelers while balancing the needs of efficient vehicular circulation. · 2.4 Sustainable landscape. Use consistent and sustainable landscape and streetscape designs that reflect the city’s community identity; showcase local assets and the community’s unique and vibrant culture.

Parks + Open Space Element
Goal 10. Abundant landscaping, trees, and green space provided throughout the community.

Policy:
· 10.3 Green space co-benefits. Recognize the many positive qualities provided by landscaping, trees, and green space including reduced heat gain, controlled stormwater runoff, absorbed noise, reduced soil erosion, improved aesthetic character, and absorption of air pollution.

Infrastructure Element
Goal 1. Infrastructure systems are functional, safe, and well maintained.

Policies:
· 1.1 Infrastructure systems plan. Establish and adopt an integrated, holistic systems approach City of Hermosa Beach Page 3 of 4 Printed on 9/12/2022
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to guide infrastructure development, improvement, maintenance, and resilience. · 1.4 Fair share assessments. Require new development and redevelopment projects to pay their fair share of the cost of infrastructure improvements needed to serve the project and ensure that needed infrastructure is available prior to or at the time of project completion.

Fiscal Impact:

The estimated District assessment for Fiscal Year 2022-2023 is $461,300, leaving a deficit of $240,835. The Preliminary Budget proposes a transfer of $239,245 from the RTI Undersea Cable Fund and $1,590 from the Tyco Fund (rather than the General Fund) to cover the deficit in the Landscaping and Street Lighting District Fund and maintain the Citywide Landscaping and Street Lighting District for Fiscal Year 2022-2023.

Attachments:

1. Draft Resolution

2. Engineer’s Report

3. Link to April 12, 2022 Staff Report

4. Link to May 10, 2022 Staff Report
Respectfully Submitted by: Andrew Nguyen, Associate Engineer Concur: Lucho Rodriguez, Deputy City Engineer
Concur: Joseph SanClemente, Public Works Director
Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
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1 2 RESOLUTION NO. 22-XXXX
3 4 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH 5 CONFIRMING A DIAGRAM AND ASSESSMENT AND LEVYING ASSESSMENTS FOR 6 THE FISCAL YEAR COMMENCING JULY 1, 2022 AND ENDING JUNE 30, 2023 IN 7 CONNECTION WITH THE HERMOSA BEACH LANDSCAPING AND STREET 8 LIGHTING DISTRICT 2022-2023
9 10 NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF HERMOSA 11 BEACH, CALIFORNIA, DOES HEREBY RESOLVE AS FOLLOWS:
12 SECTION 1. Pursuant to the provisions of the "Landscaping and Lighting Act of 1972," 13 Part 2 of Division 15 of the Streets and Highways Code, commencing with Section 22500, (the 14 "Act"), the City Council adopted Resolution No. 22-7310 initiating proceedings and ordering the 15 Director of Public Works to prepare and file the report required by the Act. Said report is for the 16 proposed levy of an annual assessment for the fiscal year commencing July 1, 2022 and ending June 17 30, 2023. Pursuant to Resolution No. 22-7310, such report was prepared and filed with the City 18 Clerk.
19 SECTION 2. The City Council adopted Resolution No. 22-7312, approving the report as 20 filed, and Resolution No. 22-7313 declaring its intention to order certain improvements and to levy 21 and collect assessments for the fiscal year commencing July 1, 2022 and ending June 30, 2023 and 22 appointing a time and place for hearing protests relative thereto. 23 SECTION 3. Following notice duly given in accordance with law, the City Council held a 24 full and fair public hearing at the time and place appointed therefor regarding the proposed levy of 25 assessments within the District and the report of the Director of Public Works, including the diagram 26 and assessment for the District. At the public hearing, all interested persons were afforded the 27 opportunity to hear and be heard regarding protests and objections to the levy and collection of the 28 proposed assessments against lots or parcels of real property within the District. 29 SECTION 4. The City Council considered all oral and written statements, protests and 30 communications made or filed by any interested persons. Any and all oral and written protests and 31 objections are hereby overruled by the City Council. 428

32 SECTION 5. Based upon its review of the Engineer's Report, a copy of which has been 33 presented to the City Council and which has been filed with the City Clerk, and other reports and 34 information presented to the City Council, the City Council hereby finds and determines that (i) the 35 land within the District will be benefited by the improvements described in Section 6 below, (ii) the 36 District includes all of the land so benefited, and (iii) the net amount to be assessed upon the land 37 within the District for the 2022-2023 fiscal year in accordance with the Engineer's Report is 38 apportioned by a method and formula which fairly distributes the net amount among all assessable 39 lots or parcels in proportion to the estimated benefits to be received by each such lot or parcel from 40 the improvements.
41 SECTION 6. The City Council hereby orders the proposed improvements to be made as 42 described in the Engineer's Report, which improvements are briefly described as follows: the 43 maintenance and operation of streets and sidewalks within the assessment District, including the 44 operation, maintenance and servicing of landscaping, lighting and appurtenant facilities located in 45 and along such streets and sidewalks.
46 SECTION 7. The City Council declares that the diagram and assessment in the Engineer's 47 Report are hereby confirmed as filed. The adoption of this Resolution constitutes the levy of an 48 assessment for the fiscal year commencing July 1, 2022 and ending June 30, 2023. 49 SECTION 8. The assessment is in compliance with the provisions of the Act, and the City 50 Council has complied with all laws pertaining to the levy of an annual assessment pursuant to the 51 Act. The assessment is levied for the purpose of paying the costs and expenses of the improvements 52 described in Section 6 above for fiscal year 2022-2023. 53 SECTION 9. The City Clerk is hereby authorized and directed to file a certified copy of 54 this Resolution and the diagram and assessment with the County Auditor of the County of Los 55 Angeles. Thereupon, the County Auditor shall provide for the collection of assessments at the time 56 and in the manner provided in the Act.
57 SECTION 10. The City Clerk shall certify to the passage and adoption of this Resolution, 58 shall cause the original of the same to be entered among the original Resolutions of the City Council, 59 and shall make a minute of the passage and adoption thereof in the minutes of the City Council 60 meeting at which the same is passed and adopted.
61 62 PASSED, APPROVED AND ADOPTED this 14th day of June, 2022. 63 429

64 ________________________________________________________________________ 65 PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, California 66 67
68 69 ATTEST: APPROVED AS TO FORM:
70 71
72 __________________________ __________________________ 73 City Clerk City Attorney
74 75
430
ENGINEER’S REPORT

CITY OF HERMOSA BEACH

LANDSCAPING AND

STREET LIGHTING DISTRICT
2022-2023
DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 431

ENGINEER'S REPORT

CITY OF HERMOSA BEACH

LANDSCAPING AND

STREET LIGHTING DISTRICT
2022-2023
Prepared By:

Romany Basilyous
Associate Engineer
Lucho Rodriguez, P.E.

Deputy City Engineer
May 10, 2022
DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 432

ENGINEER'S REPORT

CITY OF HERMOSA BEACH
LANDSCAPING AND STREET LIGHTING DISTRICT 2022-2023

TABLE OF CONTENTS
Certificate .................................................................................................. 1 Report........................................................................................................ 2 Part A - Plans and Specifications ................................................... 4 Part B - Estimate of Cost................................................................ 5 Part C - Assessment Roll ............................................................... 6 Part D - Method of Apportionment of Assessment.......................... 7 Part E - Property Owner List........................................................... 9 Part F - Assessment District Boundary........................................... 10 DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 433
1 ENGINEER’S REPORT

CITY OF HERMOSA BEACH
LANDSCAPING AND STREET LIGHTING DISTRICT 2022-2023
The undersigned respectfully submits the enclosed report as directed by the City Council.

DATED: May 10, 2022
BY: Joseph SanClemente
Director of Public Works
______________________________________
BY: Lucho Rodriguez, P.E.

Deputy City Engineer
______________________________________
BY: Romany Basilyous
Associate Engineer
I HEREBY CERTIFY that the enclosed Engineer's Report, together with Assessment Roll and Diagram thereto attached was filed with me on the _________ day of __________, 2022.

City Clerk, City of Hermosa Beach
Los Angeles County, California
By
I HEREBY CERTIFY that the enclosed Engineer's Report, together with Assessment Roll and Diagram thereto attached, was approved and confirmed by the City Council of the City of Hermosa Beach, California, on the _________ day of __________, 2022.

City Clerk, City of Hermosa Beach
Los Angeles County, California
By
I HEREBY CERTIFY that the enclosed Assessment Roll and Diagram were filed with the County Auditor of the County of Los Angeles, on the _________ day of __________, 2022.

City Clerk, City of Hermosa Beach
Los Angeles County, California
By
DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 2nd
June
June
2nd
434
2 FISCAL YEAR 2022-2023

CITY OF HERMOSA BEACH

ENGINEER'S REPORT PREPARED PURSUANT TO THE PROVISIONS OF THE LANDSCAPING AND LIGHTING ACT OF 1972, SECTION 22500 THROUGH 22679, OF THE CALIFORNIA STREETS AND HIGHWAYS CODE
Pursuant to Part 2 of Division 15 of the Streets and Highways Code of the State of California, and in accordance with the Resolution of Initiation adopted by the Council of the City of Hermosa Beach, State of California, in connection with the proceedings for:

HERMOSA BEACH
LANDSCAPING AND STREET LIGHTING DISTRICT 2022-2023
Hereinafter referred to as the "Assessment District" or "District", Lucho Rodriguez, Deputy City Engineer, the duly appointed ENGINEER OF WORK, submit herewith the "Report" consisting of six (6) parts as follows:

PART A
Plans and specifications for the improvements showing and describing the general nature, location and extent of the improvements.

PART B
An estimate of the cost of the proposed improvements for FY 2022-2023, including incidental costs and expenses in connection therewith.

PART C
An assessment of the estimated cost of the improvements on each benefited lot or parcel of land within the Assessment District.

PART D
The method of apportionment of assessments, indicating the proposed assessment of the total amount of the costs and expenses of the improvements upon the several lots and parcels of land within the Assessment District, in proportion to the estimated benefits to be received by such lots and parcels.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 435
3 PART E
A list of the names and addresses of the owners of real property within the Assessment District, as shown on the last equalized roll of the Assessor of the County of Los Angeles.

PART F
The Diagram of the Assessment District Boundaries showing the exterior boundaries of the Assessment District, the boundaries of any zones within the Assessment District and the lines and dimensions of each lot or parcel of land within the Assessment District.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 436
4 PART A

PLANS AND SPECIFICATIONS
The facilities, which have been constructed within the City of Hermosa Beach, and those which may be subsequently constructed, will be operated, serviced and maintained as generally described as follows:

DESCRIPTION OF IMPROVEMENTS

FOR THE HERMOSA BEACH
LANDSCAPING AND STREET LIGHTING DISTRICT 2022-2023
The proposed improvements for FY 2022-2023 may be generally described as the continued maintenance and operation of streets and sidewalks within the District, including the operation, servicing and maintenance of landscaping, lighting and appurtenant facilities that are located in and along such streets and sidewalks, including but not limited to, personnel, electrical energy, utilities such as water, materials, contracting services, and other items necessary for the satisfactory operation of these services described as follows:

Street Landscaping and Appurtenant Facilities
Landscaping, planting, shrubbery, trees and appurtenant facilities, including irrigation systems, hardscapes and fixtures in public street and sidewalk rights-of-way, including parkways and medians, within the boundaries of the Assessment District.

Street Lighting and Appurtenant Facilities
Poles, fixtures, bulbs, conduits, equipment including guys, anchors, posts and pedestals, metering devices and appurtenant facilities as required to provide street lighting and traffic signals in public street and sidewalk rights-of-way, including parkways and medians, within the boundaries of the Assessment District.

Maintenance means the furnishing of services and materials for the ordinary and usual maintenance, operation and servicing of the landscaping, lighting facilities and appurtenant facilities, including repair, removal or replacement of all or part of any of the landscaping, lighting facilities or appurtenant facilities; providing for the life, growth, health and beauty of the landscaping, including cultivation, irrigation, trimming, spraying, fertilizing and treating for disease or injury; the removal of trimmings, rubbish, debris and other solid waste; and the cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti.

Servicing means the furnishing of water for the irrigation of the landscaping and the maintenance of any of the lighting facilities or appurtenant facilities and the furnishing of electric current or energy, gas or other illuminating agent for the lighting facilities, or for the lighting or operation of the landscaping or appurtenant facilities.

The plans and specifications for the improvements, showing and describing the general nature, location, and the extent of the improvements, are on file in the office of the City Clerk and are incorporated herein by reference.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 437
5 PART B

ESTIMATE OF COSTS

LANDSCAPING AND STREET LIGHTING DISTRICT
Proposed Budget - Fiscal Year 2022-2023
The estimated cost of the operation, servicing and maintenance of the street and sidewalk improvements for fiscal year 2022-2023, as described in Part A, are summarized herein and described below.

Lighting and Landscaping Maintenance and Servicing
• Median & Pkwy Landscaping Maintenance and Servicing
• Lighting Maintenance and Servicing
• Tree Trimming $522,782
Administration Costs $11,054
Insurance $204,533
L.A. County Tax Collection Costs $2,000
Equipment Replacement $55,099
Proposed Capital Improvements $0
Expenditures Subtotal: $795,468
Appropriation from Fund balance $92,097
Amount transferred from RTI Undersea Cable Fund and Tyco Fund $240,835 Miscellaneous Revenues $1,236
Total Assessment: $461,300
Fund Balance 6/30/23 $0
Total amount of $229,790 was transferred from the RTI Undersea Cable Fund in FY 2021–

22. An additional amount of $239,245 will be transferred from the RTI Undersea Cable Fund and $1,590 will be transferred from the Tyco Fund to maintain the District for FY 2022–23.

The 1972 Act requires that a special fund be set up for the revenues and expenditures of the District. Funds raised by assessment shall be used only for the purpose as stated herein. A contribution to the District by the City may be made to reduce assessments, as the City Council deems appropriate. Any balance or deficit remaining on July 1 must be carried over to the next fiscal year.

Note: Total cost of the operation, servicing and maintenance of the Landscaping and Street Lighting District 2022-2023 is estimated to be $795,468.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 438
6 PART C

ASSESSMENT ROLL
The total proposed assessment for Fiscal Year 2022-2023 and the amount of the total proposed assessment apportioned to each lot or parcel within the District, as shown on the latest assessment roll at the Los Angeles County Assessor's Office, are contained in the Assessment Roll on file in the office of the City Clerk of the City of Hermosa Beach, which is incorporated herein by reference.

The description of each lot or parcel is part of the Los Angeles County assessment roll and this roll is, by reference, made part of this Report.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 439
7 PART D

METHOD OF APPORTIONMENT OF ASSESSMENT

GENERAL
Part 2, of Division 15, of the Streets and Highways Code, the Landscaping and Lighting Act of 1972, permits the establishment of assessment districts by cities for the purpose of providing certain public improvements which include operation, maintenance and servicing of street lights, traffic signals and landscaping.

The 1972 Act requires that maintenance assessments be levied according to benefit rather than according to assessed value. Section 22573 provides that:
“The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefits to be received by each such lot or parcel from the improvements.”
The Act permits the designation of zones of benefit within any individual assessment district if "by reason of variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvements" (Sec. 22574) Thus, the 1972 Act requires the levy of a true "benefit assessment" rather than a "special tax." Exempted from the assessment would be the areas of all publicly owned property in use in the performance of a public function. Railroad and utility rights-of-way are also exempt from assessment.

BENEFIT ANALYSIS
• Street Lighting and Traffic Signals - The proper functioning of street lighting and traffic signals is imperative for the welfare and safety of the public and property throughout the City. Proper operation, maintenance and servicing of the street lighting system benefits properties within the District by providing proper illumination for ingress and egress and safe traveling at night. Properties within the District also benefit from the proper functioning of the District's traffic signal system. Proper operation of the streetlight and traffic signal systems is imperative to public convenience, orderly traffic flow, enhanced congestion management and safety. Improved security, fuel conservation, protection of property from crime and vandalism, and reduction of traffic accidents, are special and direct benefits to all properties within the City; lighting benefits are directly related to public safety and property protection and therefore increase property values.
• Median and Parkway Landscaping and Tree Trimming - Trees, landscaping, hardscaping and appurtenant facilities, if well maintained, provide beautification, shade and enhancement of the desirability of the surroundings, and therefore increase property value.

The City maintains trees and miscellaneous shrubbery and landscaping throughout the City.

The trees, shrubbery and landscaping are located within the public street and sidewalk rights-ofway, including parkways and medians. These trees, shrubbery and landscaping provide an DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 440
8 aesthetically pleasing environment, shade, beautification, and, according to some authorities, air purification and sound attenuation. These positive attributes increase the value of all properties throughout the City.

Therefore, all property within the District receive an overall specific and direct benefit from the maintenance and servicing of the street median and parkway landscaping and street tree trimming programs.

Special benefits which are received by all parcels in the City are considered to be City-wide Benefits, and the associated costs of these special benefits are spread equally, based on Equivalent Dwelling Units, to all parcels within the District. All properties in the District benefit from the operation, maintenance and servicing of the street lighting, traffic signals, street median and parkway landscaping and street tree trimming.

The degree of benefit to each parcel of land varies depending on its land use and the size of the parcel. If assessments were spread on an individual parcel basis, not considering land use or parcel size, it would not be an equitable method of spread because a single family parcel would pay the same assessment as a 50-unit apartment parcel or a large commercial parcel.

Therefore, the method for spreading the improvement costs, which must be based on special and direct benefit, is on an Equivalent Dwelling Unit (EDU) basis. The EDU method uses the residential dwelling unit as the basic unit and compares other uses to it, as follows:
• Residential parcels are assessed based on the number of dwelling units on each parcel, where each residential dwelling unit equals one EDU
• Non-residential parcels have been converted into EDU'S, based on engineering judgment taking into consideration the size of the parcel and the amount of frontage along the street.

Every parcel is assessed a minimum of one (1) EDU.

There are a total of 11,129 EDU's within the Assessment District.

ASSESSMENT RATE CALCULATION
Based on a budget of $461,300 as shown in Part B of this report, the preliminary assessment rate for FY 2022-2023 is calculated as follows:
$461,300 ÷ 11,129 EDU's = $41.45 per EDU
The assessment for FY 2021-2022 was $41.45 per EDU.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 441
9 PART E

PROPERTY OWNER LIST
A list of names and addresses of the owners of all parcels within this District is shown on the last equalized Property Tax Roll of the Assessor of the County of Los Angeles, which by reference is hereby made a part of this report. This list is keyed to the Assessor's Parcel Numbers as shown on the Assessment Roll on file in the office of the City Clerk of the City of Hermosa Beach.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 442
10 PART F

ASSESSMENT DISTRICT BOUNDARY
The boundaries of the District are coterminous with the boundaries of the City of Hermosa Beach. A diagram showing the exterior boundaries of the District, the boundaries of any zones within the District, and the lines and dimensions of each lot or parcel of land within the District is on file in the office of the City Clerk of the City of Hermosa Beach, and is incorporated herein by reference. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the Assessor of the County of Los Angeles for fiscal year 2021-2022. The Assessor's maps and records are incorporated by reference herein and made part of this report.

DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 443
11 2022-2023
DocuSign Envelope ID: D92A85C7-E816-45D7-B319-4B12DB2306C0 444
City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0374
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022
INFORMATION REGARDING THE CITY’S

HISTORIC RESOURCES PRESERVATION PROGRAM
(Interim Community Development Director Angela Crespi)
Recommended Action:

Staff recommends City Council receive a report regarding the City’s historic resources preservation program and provide staff with feedback regarding the program as desired.

Executive Summary:

At its May 10, 2022 meeting, Mayor Mike Detoy requested Council consider directing staff to bring an item regarding the City’s historic resources preservation program including fiscal impacts, possible waiver of fees, and any information about historical designations in Hermosa Beach. The proposed future agenda item was unanimously supported by all Councilmembers in attendance. This report provides an overview of the historic resources preservation program, as well as the requested financial information.

Background:

The City’s Historic Resources Preservation Ordinance, as codified in the Hermosa Beach Municipal Code (HBMC) Chapter 17.53 was adopted in 1998. The purpose of the historic resources preservation program is to identify and ensure the long-term protection and use of local historic resources, such as buildings and structures, sites and places within the City that reflect special elements of the City's architectural, artistic, cultural, historical, political, and social heritage.

To be eligible for consideration as a landmark, a historic resource must be at least 50 years old.

However, a historic resource at least 30 years old may be eligible if the City Council determines it is exceptional or is threatened by demolition, removal, relocation, or inappropriate alteration. Per the HBMC, the resource must also meet one or more of the following criteria:
• It exemplifies or reflects special elements of the City’s cultural, social, economic, political, aesthetic, engineering, or architectural history;
• It is identified with persons or events significant in local, state, or national history; • It embodies distinctive characteristics of a style, type, period, or method of construction, or is a valuable example of the use of indigenous materials or craftsmanship; City of Hermosa Beach Page 1 of 6 Printed on 6/9/2022
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Staff Report
REPORT 22-0374
• It is representative of the notable work of a builder, designer, or architect; or • Its unique location or singular physical characteristic(s) represents an established and familiar visual feature or landmark of a neighborhood, community, or the City.

Past Board, Commission, and Council Actions
Meeting Date Description
December 17,1996 City Council adopted a two-year moratorium ordinance on the demolition or modification of historic and architecturally significant structures for the purpose of possible adoption of a historic preservation ordinance.

October 20, 1998 Planning Commission adopted a resolution recommending approval of the draft Hermosa Beach Preservation
Ordinance (PC Resolution 98-65).

October 27, 1998 City Council approved a text amendment to the zoning ordinance adding a Hermosa Beach Preservation
Ordinance (Ord. No. 98-1186). City Council adopted a
resolution establishing a list of potential historic buildings (Resolution No. 98-5937).

July 23, 2002 City Council approved the designation for the Hermosa Beach Community Center at 710 Pier Avenue (City Council Resolution 02-6216).

Discussion:

Nomination of a historic resource as a landmark may be made by the City, or by application of the property owner or property owners representing a majority or controlling interest in the property on which the resource is located. With the property owners written consent, a Historic Landmark Nomination Application may be submitted to the Community Development Department for processing.

Once the Community Development Department has determined an application is complete, meaning the application is submitted with all supporting materials and all fees have been paid, no development related permits including: building; alteration; demolition; removal; or relocation permits for any historic resource, improvement, building or structure relative to a proposed landmark shall be issued until a final determination regarding the proposed designation is made by City Council.

After receipt of a complete application, staff would schedule a public hearing before the City Council to study the proposed designation and to determine its eligibility and qualifications. The Council has no more than 70 days from the initial hearing date to approve, in whole or in part, or disapprove the proposed designation. Council carefully considers whether a proposed property meets the HBMC City of Hermosa Beach Page 2 of 6 Printed on 6/9/2022
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criteria for landmark designation, therefore, an application does not guarantee designation.

The fiscal impact of an application is reflected in the application fees, which are included in the City’s Master Fee Schedule and based directly on the cost of providing the service. In 2022, the total fees associated with a historic resource nomination is $4,298.19* and include:
· Historic Resources Review, Nomination/Application Fee $2,756; · Legal Public Hearing Noticing (300 Foot Radius) $881; · Legal Advertising in a Local Newspaper $176;
· Required Categorical Exemption of the California Environmental Quality Act $204; and · City Records Technology System Fee $281.19.
*An additional 2.75 percent processing is applied if the applicant pays by credit card.

There is no mechanism in the associated HBMC or the resolution adopting the Master Fee Schedule to waive the fees associated with an application by a property owner. Should Council desire a mechanism to waive the fees associated with a Historic Landmark Nomination Application, policy decisions including objective eligibility criteria would need to be made. Similarly, should City Council desire to initiate the nomination of a privately owned property, the same eligibility criteria would need to be established. Eligibility criteria could include considerations regarding the quality of the structure, owner income, community benefit, potential for destruction, etc.

The above outlined fees do not include the possible need to hire a historic preservation consultant to prepare a study outlining the historical or architectural significance of the proposed resource. If required, the report and recommendation from a historic preservation professional would serve as the basis for City Council action regarding whether the resource qualifies under the ordinance criteria.

The estimated cost of a professional historic preservation report is between $5,000 and $10,000. If such a consultant were deemed to be necessary, the cost would need to be reimbursed by the applicant.

Once City Council designates a property as a historic landmark, the property is listed on the local register of landmarks and all appropriate City departments are notified so that the notice of designation is incorporated into the necessary City records. Unless otherwise exempted, HBMC Section 17.53.140 requires any modification to a property listed on the City’s register of landmarks to obtain a Certificate of Appropriateness granted by the City Council. The review process for a Certificate of Appropriateness includes a City Council evaluation of whether the proposed modifications alter any of the historic defining characteristics of the structure. With the local designation, the landmark would be able to utilize the California Historical Building Code as an alternative to complying with the building standards in HBMC Title 15, Building Code.

As of June 2022, the following buildings have been designated or identified for protection under the City’s Historic Resources Preservation Ordinance:

1. The locally designated landmark ‘Bijou Theater’ at 1229-1235 Hermosa Avenue;

2. The locally significant landmark Hermosa Beach Community Center at 710 Pier Avenue (City City of Hermosa Beach Page 3 of 6 Printed on 6/9/2022
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2. The locally significant landmark Hermosa Beach Community Center at 710 Pier Avenue (City Council Resolution 02-6216); and

3. The Bank of America Building at 90 Pier Avenue and Hermosa Hotel at 20-26 Pier Avenue are designated as potential landmarks that warrant further study by Section 17.53.040(B) of the Historic Preservation ordinance (per Planning Commission Resolution No. 98-65).

Removal of a historic landmark designation status would also require an application and City Council approval. In the event of substantial destruction of a landmark, the City Council would hold a public hearing to determine whether the character defining features have been altered thus negating the historic status. The fee associated with an application to remove the historic status in 2022 would be $6,039 per the City’s Master Fee Schedule.

In Hermosa Beach, a historic landmark designation is for local purposes only and does not include State or National designation. The City does not currently participate in historic preservation incentive programs such as the Mills Act, which is a State program administered and implemented by local governments.

Where available, the Mills Act program allows cities to enter into contracts with the owner of a historic structure to provide a method of reducing property taxes by 50 percent or more, in exchange for the continued preservation of the property. To qualify for the Mills Act, a building must first be designated as a local landmark or be a contributing structure within a designated local historic district approved by the City Council.

To opt into the Mills Act program, City Council would need to adopt an ordinance to implement the Mills Act. The City would then have the authority to determine eligibility criteria, how many contracts they will allow in their jurisdiction, application procedures, and contract terms.

The City is currently undergoing a comprehensive update to the zoning code. As part of this effort, the Planning Commission and City Council will consider changes to code sections including HBMC Chapter 17.53 (Historic Resources Preservation). As currently proposed, modifications to changes to Chapter 17.53 only include minor text changes to ensure that the language is clear, concise, and easy to use. No major programmatic or policy changes are proposed as the City’s Historic Preservation Ordinance is currently in line with industry best practices.

General Plan Consistency:

This report and associated recommendation have been evaluated for their consistency with the City’s General Plan. Relevant Policies are listed below:

Land Use Element
Goal 5. Quality and authenticity in architecture and site design in all construction and renovation of buildings.

Policy:
· 5.5 Preservation and adaptive reuse. Provide incentives for the preservation or adaptive City of Hermosa Beach Page 4 of 6 Printed on 6/9/2022
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reuse of historic structures and iconic landmarks.

Goal 10. A strong sense of cultural and architectural heritage.

Policies:
· 10.1 Historic landmarks and districts. Encourage the voluntary designation of potentially historic resources as landmarks or historic districts.
· 10.2 Protect designated landmarks. Continue to use the Certificate of Appropriateness process for reviewing applications to demolish or alter designated landmarks. · 10.3 Public and institutional facilities. Consider the designation of potentially historic public or institutional resources under threat of demolition or deterioration. · 10.4 Historic resources as cultural tourism. Promote historic places and cultural tourism as an economic development strategy.
· 10.5 Adaptive reuse and sustainable development. Promote historic preservation as sustainable development and encourage adaptive reuse of historic or older properties. · 10.6 History and cultural heritage. Support and encourage efforts to document and share the cultural heritage and history of Hermosa Beach.
· 10.7 Culturally inclusive planning. Ensure that historic preservation planning is culturally inclusive and reflective of the unique background and diversity of neighborhoods in the city. · 10.8 Incentives and technical assistance. Provide expert technical assistance to owners of potentially eligible and designated historic properties with tools and incentives to maintain historic resources.
· 10.9 Salvage architectural features or materials. Encourage the preservation or reuse of historic architectural features on site or within the community. · 10.10 Archaeological and paleontological resources. Recognize the prehistory and history of the city and strive to identify, protect, and preserve archaeological and paleontological resources.

Fiscal Impact:

There is no fiscal impact associated with the recommended action.

Attachments:

1. Planning Commission Resolution 98-65

2. City Council Resolution 98-5937

3. City Council Resolution 98-1186

4. City Council Resolution 99-5980

5. City Council Resolution 99-5981

6. City Council Resolution 02-0616

7. Link to Historic Preservation Ordinance

8. Link to The California Office of Historic Preservation-Mills Act Program City of Hermosa Beach Page 5 of 6 Printed on 6/9/2022
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Respectfully Submitted by: Melanie Hall, Interim Associate Planner Concur: Angela Crespi, Interim Community Development Director Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
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City Council Hybrid Meeting
06-14-22 17:00
Agenda Name Comments Support Oppose Neutral
a) REPORT 22-0374 INFORMATION REGARDING THE CITY'S

HISTORIC RESOURCES PRESERVATION PROGRAM
(Interim Community Development Director Angela Crespi)
15 15 0 0
Sentiments for All Agenda Items
The following graphs display sentiments for comments that have location data. Only locations of users who have commented will be shown.

Overall Sentiment
Agenda Item: eComments for a) REPORT 22-0374 INFORMATION REGARDING THE CITY'S

HISTORIC RESOURCES PRESERVATION PROGRAM
(Interim Community Development Director Angela Crespi)
Overall Sentiment
Dean Nota
Location: 90254, Hermosa Beach
Submitted At: 2:57pm 06-14-22
I am an architect and have been a resident of Hermosa Beach since 1977. The original preservation ordinance, enacted in 1998, was a good beginning to a process that needs to be taken to the next level, if the historic fabric of this City is to be preserved. Back in 1998, I reviewed a list of historic buildings that was identified by a City consultant, that needs to be revisited for completeness. As I understand it, the list was assembled primarily from a "windshield survey" by the consultant. Windshield surveys are visual, cursory at best, and do not reflect the scope of the criteria for historic designation specified in the 1998 ordinance. Given the current, rapid replacement of existing buildings in the South Bay by newly constructed developments, the need for a thoughtful update to the ordinance is warranted. I urge the City Council to devote resources to the revitalization of our historic preservation process.
492
Barbara Force
Location: 90254, Hermosa Beach
Submitted At: 12:07pm 06-14-22
As a resident and property owner in Hermosa beach since 1980, I wish to keep Hermosa as the lovely coastal city we have had. I support
being able to establish landmark status on older homes. I feel the fees that are imposed just to look into this status are outrageous.

I support looking into this process, and having a review, especially regarding Marsha Majka's historic corner home. It certainly adds
to the neighborhood and I would like to see it remain as it is. Many homes in Hermosa have been in the same family for decades and are kept up and add to our history.

Anna Taylor
Location: 90254, Hermosa Beach
Submitted At: 11:14am 06-14-22
As a 50ish year Hermosa Beach resident and property owner, I am in support of reviewing our process for declaring residential properties as Historical Landmarks. I would like to keep Hermosa Hermosa as best we can.

We have had wonderful events and we have fought wars together (i.e. oil drilling) to keep Hermosa Hermosa.

That is who we are.

In addition, there are a few opportunities for us to preserve reminders of our past. That would include residential Historical Landmarks. I believe that we should facilitate homeowners who voluntarily offer their properties for this purpose. Some have spent their lives and money preserving what our ancestors built. Those homes and their stories will keep Hermosa Hermosa!
John Burk
Location: 90254, Hermosa Beach
Submitted At: 10:47am 06-14-22
Please preserve 2204 Monterey Blvd; I am in favor of saving the older homes Elka Worner
Location: 90254, Hermosa Beach
Submitted At: 9:30am 06-14-22
The city of Hermosa Beach should do everything in its power to incentivize historic preservation, especially of residential properties. Charging Marsha Majka a $4,416 fee to designate her home a historic landmark sends the wrong message to homeowners. It’s no accident that Redondo Beach has 104 Mills Act historic homes. They do not charge fees for residential landmark designations. The HB council should waive Majka’s fee and those of future conservationists.

Sent from my iPhone
Dean francois
Location:

Submitted At: 12:34am 06-14-22
Considering the unusual circumstances with this application, especially since as I understand the property tax reduction will not amount to much, the fees should be reduced or waived.

However, the historical designation process clearly needs to be revised to make the fees reasonable and waived in circumstances where there is hardly any tax reduction. We should look at ways to streamline the process to reduce the city costs, possibly utilizing the historical society for some of the initial application and reviews and delay other fees until designation has been granted.

I served as a Preservation Commissioner in Redondo and this city should be used as a good example of how a program is set up and works. Redondo has numerous landmarks and complete neighborhoods set up as historical resources. I would support and be happy to help work on such a project.

Geoff Yarema
493
Location: 90254-2630, Hermosa Beach
Submitted At: 7:52pm 06-13-22
Members of the City Council: please consider waiving the fees in connection with the application Marsha Majka is seeking to file for historic designation of her home on Monterey Boulevard. Supporting this request is a petition previously delivered to the city manager, gladly signed by 44 neighbors (a month ago, in less than 48 hours), speaking for hundreds of others. I look forward to offering thoughts by zoom tomorrow evening on action items you might consider in response to the staff report that will be before you. Thank you for your consideration.

Wayne Halford
Location: 90254, Hermosa Beach
Submitted At: 4:34pm 06-13-22
I am deeply saddened to watch our beach town disappearing one house at a time being replaced with two and three-story houses. This small-town atmosphere with its single-story beach homes is what convinced me to buy here 28 years ago. Government established an ordinance to supply incentive to people living in these vintage homes to help maintain and preserve the craftmanship used back in the day. Please give extra consideration to the very special house at 2204 Monterey Blvd. on the corner of Park Ave.; it is also a landmark location being one of the oldest, original, curved streets in town. It is truly one of the cutest homes in Hermosa, I love the front sunroom constructed with extra-large cinder blocks and wood shingles with vintage casement steel small paned, opening windows.

Please consider a way to make this affordable for Marsha Majka, in light of her fixed income, to make it possible for her to leave a bit of history to Hermosa Beach.

Thank you.
kathy dunbabin
Location: 90254, hermosa beach
Submitted At: 4:07pm 06-13-22
I support a Historic Resources Preservation Ordinance so that a homeowner can declare their home a historic property only if the home owner initiates the process. Understanding that there could be fees, the fees to process the request should be reasonable.

Amy Irwin
Location:

Submitted At: 3:21pm 06-13-22
Dear City Council,
I am writing in favor of the City Council’s Historical Resource Preservation Program to consider waiving of fees for historical designations in Hermosa Beach. I have always hoped some Hermosa Beach homes could be deemed as Historic Preservation sites for current and future residents and visitors to enjoy seeing. Our city’s charm and past history is something I feel is important for future generations to be able to see. I am hoping that you will consider making Marsha Majak’s little cottage on Monterey and Park eligible for Historic Preservation without requiring her to pay fees that are not affordable to her. Thank you for your consideration.

Sincerely,
Amy Irwin
510 24th Place
Hermosa Beach CA
Ken Irwin
Location:

Submitted At: 2:33pm 06-13-22
Honorable Hermosa Beach City Council:

It would be a shame for historical homes in Hermosa Beach, whose owners wish to designate them for preservation, to not be protected from demolition because of too many hoops to jump through in the process or the financial burden that prevents an application from ever being submitted! Clearly there are fewer and fewer structures with historical significance remaining in HB these days due to rebuilding in the beach communities. 494
Knowing that, and the lack of ANY private homes that have been designated as historical in HB since City Council’s 1998 resolution, it seems that it would be in the City’s best interest and within HB City Council’s duties to review this program and it’s application/fee structure to make it more beneficial or less of an onus to the homeowners who might be considering foregoing any future benefits and “leaving” their homes to HB as a historical landmark the citizens can be proud of and enjoy forever!!! Granted the process does have significant costs associated with it ( thanks Staff report) but to this citizen and his family, they are costs that we feel should be shared, all or in part, by the City of HB and its citizens based on the benefits we gain by the historical preservation of a portion of our Hermosa Beach identity!!! The state property tax reduction program for historical structures an owner might receive if HB chose to participate, as The Staff report points out, can, I believe, only be considered once a local historical designation is on the books. This does little to promote initial homeowner interest or lessen the initial financial outlay of the HB application process. Our understanding is that the home on the NW corner of Monterey Blvd. & Park Ave. is currently a prime example of why we have no officially designated historical homes in Hermosa Beach, the HB application fee and process obviously isn’t working!!! Thanks for your efforts on this topic and every other concern the City Council and Staff fully addresses on our behalf!!
Kenneth Irwin
Dency Nelson
Location: 90254, Hermosa Beach
Submitted At: 1:48pm 06-13-22
This issue is in front of you tonight due to the desire of our friend & neighbor of over 40 years, Marsha Majak, to have her beloved home of almost 50 years declared eligible for Historic Preservation. She isn't looking for property tax reduction for herself, which is what is one of hte things provided via the Mills Act, as her taxes are already very low. What she does want is for her beautiful home to be preserved for others to enjoy after she is gone. Most homeowners who live in similar dwellngs would want their beneficiaries to do whatever they want for the highest financial gain once the property passes on to those beneficiaries, and that almost always means tearing down and replacing the dwelling with something big and new. That has been the case with almost every wonderful little bungalow or even larger, older homes here in Hermosa Beach. Because of that we lose precious reminders of our past, like the beautiful little beach cottage that is Marsha's. Marsha is in a position that all she wants is to ensure that her little piece of Hermosa history remains on the corner of 24th & Park for generations after her to enjoy, but the fees imposed by the process make it impossible for her to do so. There must be a better way for those like Marsha to achieve the guarantee that ther homes will receive the designation they deserve, to protect them from demolition by a future owner, and to preserve these dwellings for the right homeowner to proudly own and continue to preserve. I look forward to the discussion of this agenda item to learn more about a possible solution for Marsha and for what I'm guessing will be the very few others who will want to put a lock on future develplment of their historic property, preserving it for future Hermosans and visitors to remeber as a chapter of our past. Thank you for considering this matter.

Moira Nelson
Location: 90254, Hermosa Beach
Submitted At: 12:05pm 06-13-22
As more and more of Hermosa Beach's costly residential properties undergo development, the small, charming beach cottages of the city's historic past, evidence of its one-time unique, small-town personality, are quickly disappearing. Any owners of the few remaining early homes who wish to preserve and maintain these vestiges of Hermosa's past should be aided and encouraged in doing so, for the benefit of us all, as they add interest and a special kind of beauty to our streets, perpetuating one of the distinct pleasures of living here and thus adding value to their neighborhoods.

Lee Hennis
Location: 90254, HERMOSA BEACH
Submitted At: 9:07am 06-13-22
I support preserving history. Homes like Ms. Majka that are well maintained are definitely worth preserving. I do, however, find the fee the city charges to get a historic designation a bit high. Many of these types of homes have been owned by the same person/family for a number of years and the owners are typically elderly and/or retired.

The council should consider a fee based on the owner's income vs. a single value.

Thank you. Lee Hennis.
495
Reinburg Sally
Location: 90254, Hermosa Beach
Submitted At: 4:46pm 06-12-22
I definitely support reviewing this process and allowing residents to have their home declared a Historical Landmark, but definitely only if it is their wish.
496
City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0373
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022

APPROVAL OF ADDITIONAL REFINEMENTS TO TEMPORARY OUTDOOR

PERMIT PROGRAMS RELATED TO MAXIMUM ON-STREET DECK AREAS AND

DISCUSSION OF CHANGES TO PIER PLAZA ENCROACHMENTS
(Environmental Programs Manager Doug Krauss)
Recommended Action:

Staff recommends City Council:

1. Approve the implementation of short-term refinements to the outdoor dining programs related to establishing maximum areas of on-street dining decks; and

2. Discuss and provide staff with feedback on potential changes to the temporary encroachment areas for Pier Plaza businesses.

Executive Summary:

At its May 24, 2022 meeting, City Council approved an extension through January 1, 2023 of the temporary outdoor dining and downtown lane reconfiguration programs that were created in response to the COVID-19 pandemic. Council also approved several program refinements to improve the program in the short-term. During the discussion, Council directed staff to seek additional policy refinements to address the impact on parking availability caused by the on-street dining decks. Staff recommends City Council approve additional program refinements to establish maximum on-street deck sizes to provide additional parking availability.

Background:

Expanded Outdoor Dining and Retail
The City has long supported and encouraged outdoor dining on private and public property to supplement indoor operations. With the onset of the pandemic and related health orders, businesses were limited to conducting business outdoors. Recognizing this hardship, City Council approved a program to allow expanded outdoor dining and other commercial activity. The City also suspended zoning and parking requirements to allow outdoor dining on private property and established a temporary encroachment permit program to allow encroachments into sidewalks, public streets, and Pier Plaza. Both the private property programs and encroachment program (together, the “Outdoor Permit Program”) include a basic set of guidelines addressing business hours, cleanliness, and maintenance.

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The City issued over 60 permits during the term of the Outdoor Permit Program in a variety of commercial locations. Initially, City Council allowed these uses without consideration of any encroachment area rents or reimbursement of lost parking meter revenue. Pursuant to the urgency ordinances that established and later extended the Outdoor Permit Program, the program remains in effect until terminated or superseded by ordinance. In June 2021, Council approved extension of the pilot program through December 31, 2021 and authorized implementation of a reapplication process for outdoor dining areas.

At its December 14 2021 meeting, Council approved an extension of the programs through May 31, 2022. At its January 25, 2022 meeting, Council discussed implementing new fees for the temporary outdoor dining encroachments and approved a fee of $1.50 per square foot per month to begin March 1. Four businesses decided to remove their on-street decks, one modified their deck area, and one sidewalk dining area was removed. None of the extended encroachment areas on Pier Plaza have been removed. Program revenues for the temporary encroachment areas are estimated to be approximately $400,000 annually. At its February 8, 2022 meeting, Council also approved reinstatement of the prior permanent encroachment fees. These fees generate approximately $280,000 annually.

Lane Reconfiguration
At the May 12, 2020 City Council meeting, City staff presented an item describing a concept to repurpose sections of public right-of-way to improve multimodal traffic safety and expand physicaldistancing options for the public and businesses per Los Angeles County Health orders related to the COVID-19 pandemic. The City Council moved quickly to accommodate these programs and staff developed guidelines based on information gathered from existing programs in other cities and internal review of policies and regulations.

City Council directed staff to work with the Economic Development Committee (EDC) to explore aspects of the program that could directly benefit local businesses. At meetings in August and September 2020, Council directed staff to move forward with designs of lane reconfiguration concepts for both Hermosa Avenue and Pier Avenue. These concepts included removing one through vehicle lane in each direction, addition of a bike lane, installation of a number of new on-street ADA accessible parking spots, and associated signage and pavement markings (hereafter, the “Downtown Lane Reconfiguration Program”). At the October 27, 2020 meeting, Council awarded a contract to perform the work. Work began in early January 2021 and was completed by January 16, 2021. As directed by Council, the lane reconfiguration was to be in place for at least six months starting from the completion date of the work and was to, therefore, operate until July 2021. At the July 13, 2021 meeting, Council approved a Resolution extending the Downtown Lane Reconfiguration Program through the end of the year. In December 2021, Council approved an extension of the program through May 31, 2022.

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Past Council Actions
Meeting Date Description
June 9, 2020 Approved Ordinance 20-1410U allowing temporary permit program for outdoor dining in response to pandemic.

July 14, 2020 Directed staff to proceed with development of lane closure plans.

June 22, 2021 Approved extension of the outdoor permit program through December 31, 2021.

July 13, 2021 Approved Resolution authorizing extension of lane reconfigurations.

October 26, 2021 Approved development and implementation of permanent versions of these programs.

December 14, 2021 Approved development of permanent programs, and extension of temporary programs through May 2022
January 25, 2022 Discussion and approval of new fees for temporary encroachments February 8, 2022 Approved reinstatement of existing fees for permanent encroachment areas
May 24, 2022 Approved Urgency Ordinance extending program and new program policy refinements
Discussion:

At its May 24, 2022 meeting, City Council approved an urgency ordinance extending the programs through January 1, 2023 along with eight program refinements to be implemented immediately.

These refinements related primarily to maintenance and aesthetic concerns with the decks. At this meeting, Council also provided feedback to staff on the general progress of the ongoing development of a permanent version of these programs.

City Council further directed staff to address the ongoing concerns over limited parking availability by exploring ways to reduce deck sizes or increase utilization of existing decks to ensure optimal parking conditions for the community and visitors. Staff now recommends implementation of a policy establishing limits on the number of parking spots an on-street deck can use. Specifically, this would limit decks to:

1. An individual business’s on-street outdoor dining encroachment may only occupy a maximum of two parallel on-street parking spaces or three head-in parking spaces; and

2. In cases where the on-street outdoor dining encroachments are located entirely in front of the business frontage and no permission for use is required from a neighboring property, a business may occupy a maximum three parallel on-street parking spaces or four head-in onCity of Hermosa Beach Page 3 of 6 Printed on 6/9/2022 powered by Legistar™499
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street parking spaces.

Staff discussed this recommendation internally and with local business stakeholders and reassessed all on-street dining decks to ensure the effectiveness of this policy refinement. This program refinement would apply to shared deck areas, as well as individually-operated decks. The change would address many of the ongoing parking availability concerns in the short-term and would include an immediate notice to the affected businesses with a deadline of July 15, 2022 to remove or modify existing decks to achieve compliance with this policy. Staff would continue to monitor existing and new deck installations to assess the effectiveness of this change to help inform the ongoing development of the permanent versions of these programs.

Staff also requests City Council feedback on the temporary encroachment areas provided for Pier Plaza businesses. Discussions with local businesses and stakeholders have raised equity concerns between the various temporary dining areas. These concerns include the amount of additional public right-of-way being made available and the fee structure applied to these encroachment areas.

Discussions have included the possibility of reducing these temporary expanded encroachments or increasing the fees to an amount similar or equal to the fees applied to the previous permanent encroachments. These historic encroachment fees are shown in the table below:

Location and Hours Fee per Square Foot
Pier Plaza, open after midnight $5
Pier Plaza, closed before midnight $2
Outside of Pier Plaza or snack shop $1
Staff requests City Council feedback regarding the additional refinements and possible direction to bring back more information or an agenda item at a future City Council meeting date.

General Plan Consistency:

The proposed program options match the model of “living streets”, also known as “complete streets”, and a key guiding principle of the General Plan Vision is to foster a vibrant local economy.

A living street combines safety and livability while supporting ground floor and outdoor economic activities. This centers on designing streets that can be safely shared by both vehicular and nonvehicular traffic. A living street should also contribute to an engaging public realm and a vibrant local economy.

Relevant Goals and Policies are listed below:

Governance Element
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REPORT 22-0373
Goal 6. A broad-based and long-term economic development strategy for Hermosa Beach that supports existing businesses while attracting new business and tourism.

Policies:
· 6.4 Business support. Support the Chamber of Commerce, retailers, tourist service businesses, artists, and other agencies to develop an aggressive marketing strategy with implementation procedures.
· 6.6 Pop-up shops. Develop plans and programs for underutilized spaces, such as vacant buildings, utility corridors, parkways, etc., for temporary retail, restaurant, and community promoting uses.

Mobility Element
Goal 1. Complete Streets (Living Streets) that serve the diverse functions of mobility, commerce, recreation, and community engagement for all users whether they travel by walking, bicycling, transit, or driving.

Policy:
· 1.1 Consider all modes. Require the planning, design, and construction of all new and existing transportation projects to consider the needs of all modes of travel to create safe, livable and inviting environments for all users of the system.

Goal 7. A transportation system that results in zero transportation-related fatalities and which minimizes injuries.

Policy:
· 7.1 Safe public rights-of-way. Encourage that all public rights-of-way are for all users at all times of day where users of all ages and ability feel comfortable participating in both motorized and non-motorized travel.

Fiscal Impact:

The $1.50 per square foot fee approved by Council in January is estimated to generate approximately $400,000 annually. If approved by City Council, establishing limits on the number of parking spots that an on-street deck can use would impact the square footage of the decks. The impact to the estimated encroachment fees in currently unknown. A revised 2022-23 revenue estimate would be provided with the 2022-23 Midyear Budget.

Additionally, reduction of temporary encroachment areas on Pier Plaza or an increase of fees for these areas would also impact revenue, although exact details are not known at this time. More information can be provided pending Council’s discussion and direction.

Attachments:

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Staff Report
REPORT 22-0373

1. Link to June 9, 2020 Staff Report

2. Link to July 14, 2020 Staff Report

3. Link to June 22, 2021 Staff Report

4. Link to July 13, 2021 Staff Report

5. Link to October 26, 2021 Staff Report

6. Link to December 14, 2021 Staff Report

7. Link to January 25, 2022 Staff Report

8. Link to February 8, 2022 Staff Report

9. Link to May 24 Staff Report
Respectfully Submitted by: Douglas Krauss, Environmental Program Manager Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
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City Council Hybrid Meeting
06-14-22 17:00
Agenda Name Comments Support Oppose Neutral
b) REPORT 22-0373 APPROVAL OF ADDITIONAL REFINEMENTS TO

TEMPORARY OUTDOOR PERMIT PROGRAMS RELATED TO

MAXIMUM ON-STREET DECK AREAS AND DISCUSSION OF

CHANGES TO PIER PLAZA ENCROACHMENTS
(Environmental Programs Manager Doug Krauss)
4 1 1 1
Sentiments for All Agenda Items
The following graphs display sentiments for comments that have location data. Only locations of users who have commented will be shown.

Overall Sentiment
Agenda Item: eComments for b) REPORT 22-0373 APPROVAL OF ADDITIONAL REFINEMENTS TO TEMPORARY OUTDOOR

PERMIT PROGRAMS RELATED TO MAXIMUM ON-STREET DECK AREAS AND DISCUSSION OF CHANGES TO PIER PLAZA

ENCROACHMENTS
(Environmental Programs Manager Doug Krauss)
Overall Sentiment
Raymond Dussault
Location: 90254, Hermosa Beach
Submitted At: 2:57pm 06-14-22
I am 100% in support of all of the extended dining decks. Every single one is a boon to the culture of the community. The deck below Tower 12, Loreto Plaza, turned a previously empty space, unsettling after dark, dominated by windblown trash, smokers and tokers, into a vibrant outdoor dining experience with more than ample - even despite my COVID weight gain - walkways on either side. The Baja Sharkeez Group was the first business to take a massive risk and invest significant money to create a pleasing space out of the space they were allowed. And, again, I use their walkway to traverse through all of the time. And, after dark, it's a lot less unsettling to move through the space when it's full of families dining. 503
Frank Hallstein
Location: 90254, Hermosa beach
Submitted At: 2:46pm 06-14-22
TO: City Council
This comment is in regards to Upper Pier Ave. Dining Decks, as you know the downtown area of Hermosa has close to 800 parking spaces and upper Pier Ave from Hermosa Ave. to Valley dr. has 125 spaces, When upper pier was beautified an extensive report was done ( you can google " Upper Pier Avenue Committee which required additional parking (none of which was added and others removed before pandemic days) I would say these requirement were in conjunction with coastal commission rules , These extensions keep creeping up on us and none of the non dining deck businesses are given much notice . We have been gracious with the situation while suffering the financial losses , we all have bills ( Rent , utilities , insurance ..business ..health..automobile etc.) So I say to all the restaurants on upper Pier your welcome ! So in the name of being Fair & equitable bring upper Pier ave. back to what it was . Also not mentioned in the last meeting and from what I hear was not presented to the council is the letter from a business requesting the removal of a dining deck in front of his business sernt May 3rd which was at that time was on the hands of Doug Krauss , the letter states that his signed letter of approval with the duration being until 12-31-2021(per "Temporary dining/Retail permit application " July 98,2021 update) as of today June,14,2021 he is not giving his approval and that is why he sent the letter , this needs to be addressed ,,,thank You ,,,Frank Hallstein (Hermosa Lock & Safe) (310) 951-2569
Skyler Simmons
Location: 90254, hermosa beach
Submitted At: 1:34pm 06-14-22
I think the extended patios and dining decks are a great addition and set us apart from the other beach cities considering our visitors can leave a restaurant and in seconds, find themselves on our beautiful beach. What they have done in Riviera village has completely turned that area around so backtracking here in Hermosa would be detrimental to the businesses and the community.

An additional observation I have is that all the businesses on the pier should have equal encroachment rights and currently, they do not. I don't understand why certain establishments are allowed to have additional encroachment areas while others are not? Sharkeez has an entire second floor, Palmilla has a roof-top deck, Brews Halls has the third patio in front of the bank, Tower 12 has completely taken over Laredo plaza and Playa Hermosa has a third patio adjacent to Vistas parking lot. Considering the parking situation, why are some establishments allowed to have so many extra seats?
Please allow the awesome encroachments to continue, just make it fair across the board.

Dean francois
Location:

Submitted At: 12:58am 06-14-22
It is long overdue to put some maximum deck areas and encroachments on to public plazas. But again it looks as if we are forgetting that one establishment has been able to encroach on the complete area of Loreto Plaza.

This is a public plaza and an extension of pier Plaza and the public needs to have fairness and equitable distributions on the encroachments.
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From: Raymond Dussault
To: City Council; City Clerk; Mayor Michael Detoy; Suja Lowenthal Subject: Dining Decks and unnecessary regulation
Date: Tuesday, June 14, 2022 2:37:04 PM
Dear Council:

Like most every resident, I support all the outdoor dining culture that has exploded in the wake of COVID. The patios have become not only an extension for the restaurant space but an extension of all of our neighborhoods. It is common now to find friends and family enjoying the extended dining decks and stopping to say hello.

Since the council began indicating these extensions were likely to be made permanent, they have become even nicer with restaurants investing in their space to enhance their appearance.

This is costly and I encourage you to not set this back with unnecessary and burdensome regulations.

I remember when the first extensions were approved and while we - restaurants and residents - were appreciative, I could never quite comprehend the last minute tack on of requiring restaurants to pack all of their tables and chairs into cramped establishments at 11PM. The way I remember it, no one even asked what the purpose of this bizarre controlling rule was for.

I implore you, please, if you have the urge to tack on even more restrictions and regulations, please ask yourselves:

Why is this rule needed?
What PROBLEM does it solve?
Is this a problem that actively exists or just one we think "might, possibly, maybe" happen in a wild worst case scenario?
If I put myself in the role of business owner, is this burdensome in ways I haven't thought of? (Like, have I envisioned for a single second where I expect businesses to put all this furniture?)
Making rules just for the sake of making rules is not governance, it's obstructionism.

Thank you for your time and please attach this to the agenda.

Sincerely,
Raymond Dussault
--
Raymond Dussault
33 North Ventures, Inc.

Hermosa Beach, CA 90254
Phone: (916) 205-1844
505

UPPER PIER AVENUE COMMITTEE
Final Report
Hermosa Beach, California
March 25, 2008
SUPPLEMENTAL email
for Item 14.b
506

UPPER PIER AVENUE COMMITTEE
Final Report
I. Introduction
In June 2006, work crews from the
Hermosa Beach Public Works Department
began the trial process of re-striping Pier
Avenue from four lanes to two. The
Community’s response to the trial was vocal
and immediate. Letters and phone calls
poured into the City and almost every one,
and whether favoring the changes or railing
against them, all invariably asked the same
question - Why is the City doing this?
The simple answer is that monies were
available to improve and fix long-standing
drainage and safety issues that plagued Pier
Avenue, and to their credit, our Planning
Department saw an opportunity to improve
Pier Avenue and looked to the City’s
R/UDAT Implementation Plan (1994) for
guidance on how best to proceed. The
Implementation Plan under “Street Section
Improvements” states at Page II-23: “Convert
2 lanes of traffic each way to 1 lane of traffic
each way. Transition to be made west of
green belt.” And that’s what the Public
Works Department did.

This incident highlighted a problem that
has the potential to change Hermosa Beach
into someplace other than the seaside village
we know and love. The striping issue
demonstrated that Hermosa Beach does not
have a well-articulated vision of the future for
Upper Pier Avenue. But this problem is
nothing new – the October 1992 R/UDAT
report stated one of the primary reasons for
engaging in the R/UDAT process was that
“Hermosa Beach desperately needs to
formulate a shared vision of its future.”
Stated simply, the striping issue illustrated
there was a planning gap for the development
UPAC – Final Report Page 1
Pier Avenue, a focal point through the generations
Present Day Community Center, formerly a Public School
507
of Upper Pier Avenue left after the R/UDAT planning process ended in the early 1990s. In order to bridge this gap, the City Council commissioned the Upper Pier Avenue Committee (“UPAC”) to examine the entire ecosystem on Upper Pier Avenue. The Council asked UPAC to analyze alternatives and build community-consensus about the future development of Upper Pier Avenue.

The UPAC brought the Community into direct contact with the City’s decision-makers and the professional staff. Throughout the process, residents had the opportunity to express their desires and concerns about the future of Upper Pier. Towards this end, the Committee conducted two separate “Town Hall” meetings, both of which were standing-room-only events. The UPAC surveyed and interviewed businesses on Upper Pier, as well as the property owners, to solicit their input and understand their concerns.

The UPAC gathered the input from the community, professional staff, and other experts and analyzed the available alternatives. The Committee understands that there will always be conflicts and disagreements among residents, businesses, and City Officials, but the Committee worked very hard to find common ground between the various interested groups and set a course of forward action for the City.

One final word about this report - this is an Executive Summary of the process UPAC engaged in to develop its recommendations for Upper Pier Avenue. This report is intended to highlight the Committee’s “big picture” recommendations and is not designed to recount the minute details of the Committee’s analysis. More detailed information can be found in the assembled minutes and sub-committee reports.

II. UPAC Mission
The City Council commissioned the UPAC to investigate the entire ecosystem of Upper Pier and recommend guidelines for its future development.

The Committee was also guided by the Hermosa Beach General Plan, which states its goal:
“Protect and maintain the small town beach community atmosphere of Hermosa Beach.” From this guidance, UPAC determined its Mission Statement to be:
“To develop the vision for a Specific Planning Area on Upper Pier Avenue based on research, consultation with design and planning professionals, and community input.” Based on these guiding principles, the UPAC engaged in a comprehensive, data-based analysis of Upper Pier Avenue. In the end, the recommendations in this report reflect the consensus of the Committee based on Community input and preferences.

UPAC – Final Report Page 2
508
III. Organization
The Council designated two City Council members (Kit Bobko & Pete Tucker), two Planning Commissioners (Pete Hoffman & Ron Pizer), and two Public Works Commissioners (Dan Marinelli & Janice Brittain) to serve on the UPAC.

At its first organizational meeting, the six standing UPAC members voted increase the Committee’s membership to eleven. Twenty-seven members of the public applied for selection.

At its February 2007 meeting the Committee elected Ken Klade, Larry Peha, Dean Nota, Kim MacMullan and Jerry Gross to join the UPAC.

All members of the Committee, both elected and nominated, had equal votes on all matters.

Every member of the Committee participated on at least one Sub-Committee.

IV. Methodology
From the outset, UPAC resolved to base its recommendations on analysis and data as opposed to opinions and supposition. The Committee made a concerted effort to reach consensus among its members, and to solicit as much community input as possible.

In order to accomplish this, the Committee conducted a 6-week survey of residents and visitors to Upper Pier Avenue in June-July 2007. There were a total of 571 responses to the survey, of which 479 were from Hermosa Beach residents. (405 surveys were completed on-line, 74 on paper.) The Alliance Consulting Group and CIDR Systems compiled and analyzed the collected data and presented their findings to the Committee on August 1, 2007.

The survey revealed that an overwhelming number of respondents favored development of an Upper Pier streetscape project, with new landscaping, textured sidewalks, improved signage, etc. Residents also favored widening the sidewalks, and corresponding improvement of the pedestrian-friendly atmosphere on Upper Pier. Nearly three-quarters of residents supported mixed-use development on Upper Pier.

The Committee also met with business owners on Upper Pier in two workshops in October 2007 to gather their feedback and input.

UPAC – Final Report Page 3
509
V. Analysis
The Committee determined the best, most efficient way to analyze the issues involved with Upper Pier Avenue would be to divide the project into four sub-committees: (1) traffic, circulation & parking; (2) urban design and streetscape; (3) land use and zoning, and; (4) economic development.

A. Traffic, Circulation & Parking
City Councilman Peter Tucker, Public Works Commissioners Dan Marinelli and Janice Brittain, and Mr. Jerry Gross comprised the Traffic, Circulation & Parking sub-committee (“Traffic Sub-committee”).

The Traffic Sub-committee tackled perhaps the most highly visible, and potentially divisive, aspect of the Upper Pier project. In fact, it was the City’s decision to re-stripe Upper Pier Avenue from four lanes to two that was one of the chief reasons the City Council decided to form the UPAC in the first place.

Pier Avenue is the main east-west arterial in downtown Hermosa Beach, with the average daily traffic counts ranging from 11,000 to as high as 19,000 vehicles per day. During peak load hours, there are approximately 2,000 vehicle trips on Pier Avenue. The Traffic Sub-committee found that reducing the Pier Avenue to only one lane in each direction (i.e., two-lanes) would intensify delays during the street’s peak-use periods.

The survey and feedback the UPAC gathered revealed that Hermosa residents prefer a fourlane configuration on Upper Pier Avenue. Many residents expressed the opinion that Upper Pier Avenue was the major thoroughfare through the City, and it was important to maintain traffic flow on it during peak use times. Residents also felt that reducing Pier Avenue to two lanes would cause unnecessary congestion during peak use times with the unwanted side-effect of forcing traffic onto neighboring residential streets.

Residents and businesses alike also expressed a desire for increased parking options on Upper Pier Avenue. The Traffic Sub-committee’s proposal results in no net-loss of parking on Pier Avenue.

UPAC – Final Report Page 4
510
The Traffic Sub-committee also took into consideration the residents’ express desire for a beautification (streetscape) program on Upper Pier, and the express preference for widening of the sidewalks.

Based on these considerations, the Traffic Sub-committee made the following recommendations to the UPAC, which the full Committee adopted. The recommendations are as follows:
■ Implement streetscape program for Upper Pier Avenue with pedestrian safety a priority ■ Maintain 4-lane configuration
■ Widen sidewalks to create a more pedestrian-friendly environment on Upper Pier Avenue (from existing 10 feet to approximately 14 feet)
■ Provide landscaped median island
■ Maintain diagonal parking on north side of Pier Avenue from Valley Drive to Manhattan Avenue
■ Convert diagonal parking to parallel parking on south side of Pier Avenue from Valley Drive to Manhattan Avenue
■ Reconfigure pedestrian crossings on Pier Avenue with “bulbs” to create pedestrian refuges and enhance safe pedestrian crossing
■ Create new “green space” at north and south sides of Manhattan Avenue where it intersects with Pier Avenue
■ Maintain diagonal parking on both sides of Pier Avenue from Manhattan Avenue to Hermosa Avenue
■ Create an eastbound “transition” lane from Hermosa Avenue to Pier Avenue ■ Implement a “scramble” pedestrian crossing at Pier Avenue and Hermosa Avenue. ■ Utilize multi-space parking meters on Upper Pier Avenue The Traffic Sub-committee made the following future recommendations for the City Council to consider:
■ Explore existing opportunities for alternative parking (i.e., leased lots, valet services, shuttle services, etc.) In particular, valet parking for restaurants along Upper Pier Avenue on Thursday, Friday, and Saturday nights
■ Consider changing 16 spaces on the east side of City Hall to 2-hour meters during the City’s non-business hours
■ Explore adding 15 spaces to Oak Street (by leasing or purchasing an easement from Marineland Mobile Home Park)
■ Consider expansion of the existing parking lot on 14th Street (adding potentially 53 additional spaces to the City’s parking inventory)
■ Consider issuing special “mirror hanger” permits to employees at the downtown area businesses that would allow them to park away from the downtown area and congested neighborhoods. This would potentially free almost 300 spaces for residential use ■ Explore construction of a pedestrian overpass and/or gateway over the greenbelt where it crosses Pier Avenue.

UPAC – Final Report Page 5
511
B. Urban Design and Streetscape
The two professional architects on the Committee, Dean Nota and Larry Peha comprised the UPAC’s Urban Design and Streetscape Sub-committee (“Urban Design Sub-committee”).

Upper Pier Avenue is, expectedly, dominated by the street that is wider than the Pacific Coast Highway. The right-of-way on Upper Pier Avenue is 10-feet wider than the State Highway. The street has traditionally been a thoroughfare for residents traveling west from PCH, and alternatively as an arterial channeling commuters from the residential neighborhoods back to the highway.

Currently, Upper Pier has sporadic, poorly coordinated landscaping and single-story buildings, which create a low, horizontal proportion to the street. The street lacks pedestrian amenities and scale, and subsequently suffers from weak pedestrian activity on a day-to-day basis. Long crosswalks and poor signage also plague upper Pier Avenue. Indeed, a common refrain from residents is that they feel “unsafe” crossing Upper Pier Avenue, especially with small children or pets.

And although some of these issues are a direct result of the large scale of Pier Avenue, that same scale presents unique opportunity for the development and design of the street. For example, one of the Committee’s main goals was to create a more pedestrian-friendly environment on Upper Pier Avenue without reducing the number of traffic lanes. Fortunately, the width of the street allows for this.

The Urban Design Sub-committee recommended that the expansive views from Upper Pier Avenue down to Pier Plaza should be maintained, along with the existing continuity of retail along the bend of Pier Avenue to Hermosa Avenue. The Sub-committee identified the large asphalt space at Pier Avenue and Hermosa as a place where the pedestrian experience (and safety!) would be enhanced by a reduction in the scale of the crosswalk.

Additionally, the Sub-committee recognized an opportunity to bring consistency to the landscaping and design from Hermosa Avenue to PCH, and to promote continuity in the urban design along the entire length of the street.

The Urban Design Sub-committee also suggested that Upper Pier Avenue not be designed primarily to accommodate automobiles, but rather as a shared use between automobiles and pedestrians.

Finally, the Urban Design Sub-committee recommended the City look for ways to preserve historic buildings along Upper Pier Avenue to maintain the street’s unique “Hermosa feel.” C. Land Use and Zoning
City Councilman Kit Bobko, Planning Commissioner Pete Hoffman, and architects Dean Nota and Larry Peha comprised the Land Use and Zoning Sub-committee (“Land Use Subcommittee”). This sub-committee’s examined the land uses and zoning requirements for the development of Upper Pier Avenue.

UPAC – Final Report Page 6
512
Two considerations guided the Land Use Sub-committee’s analysis. First, the subcommittee took into consideration the location of Upper Pier Avenue in relation to the rest of Hermosa Beach.1 Upper Pier Avenue is the “heart” of Hermosa Beach, and it is located in one of the most densely populated cities in Southern California. This consideration led the Subcommittee away from recommendations that would increase the density and traffic on Upper Pier Avenue. Instead, the Sub-committee’s recommendations further the idea of a small town “village center.” For example, the Sub-committee shied away from mixed-use residential uses on Upper Pier Avenue that would increase traffic and residential density in favor of mixed-use commercial uses that would increase pedestrian traffic on the street.

The second consideration was based on guidance from the UPAC Mission Statement and the City’s General Plan – to promote a pedestrian-friendly “village center” for Hermosa Beach.

Making Upper Pier Avenue more pedestrian-friendly is not a mysterious process; people will naturally walk more if useful destinations are close to their homes, and the environment is safe, interesting and pleasant. The Sub-committee (and Committee at-large) believes a diverse mix of uses and useful destinations at the center of our community would facilitate a more walkable environment.

UPAC – Final Report Page 7
1 All of the properties fronting Upper Pier Avenue are zoned C-2 (“Neighborhood Commercial”). According to the Hermosa Beach Zoning Ordinance, C-2 is zoned “to provide opportunities for a limited range of office, retail, and service commercial uses specifically appropriate for the sale and character of the downtown – a resident and visitor serving pedestrian oriented shopping/entertainment district.” HBMC §17.26.020 B (2).

UPPER PIER AVENUE — YEAR STRUCTURE BUILT
513
With these considerations in mind, the Sub-committee looked for ways to promote a coherent “village center” retail sector serving local residents and visitors, and arrived at the following recommendations:
■ Analyze the C-2 (“Downtown Commercial Zone”) permitted use list and related sign ordinances in the context of promoting pedestrian-friendly, resident-serving, day time uses consistent with the existing zone and General Plan designation ■ Encourage commercial mixed-use with service-type industries on the second floor and general commercial/retail on the ground floor
■ Retain the 30-foot height limit (from existing grade), with a strong preference towards 2 stories
■ Improve the visual aesthetics by limiting franchise architecture, promoting consistent streetscaping, minimizing bulk, scale, and massing of any new buildings on the street ■ Analyze existing parking requirements relevant to dis/incentives for redevelopment and/or redesign of existing buildings
■ Insure Conditional Use Permit (“CUP”) policies on Upper Pier Avenue are consistent with community oriented, resident serving uses – including standards for hours of operation and outdoor dining
■ Provide incentives for retention, rehabilitation, and adaptive reuse of historic buildings UPAC – Final Report Page 8
UPPER PIER AVENUE — ZONING DESIGNATIONS
514
■ Encourage “permeable” building facades to facilitate pedestrian-friendly uses/atmosphere on the street
■ Analyze impact of proposed redevelopment of Civic & Community Center sites and Pier Avenue frontages to insure consistency with UPAC design and development standards.

D. Economic Development
Two local Businessmen Ken Klade (Klade Gallery) and Jerry Gross (Branded Mortgage) and Planning Commissioner Ron Pizer comprised the Economic Development Sub-committee.

The Economic Development Sub-committee started its analysis by conferring with local business owners to understand their interests and concerns regarding UPAC. The Sub-committee met with Upper Pier business owners twice to gather their input and insure their inclusion in the process.

The Sub-committee also met with the property owners to gather their input on the UPAC.

Additionally, the Sub-committee and UPAC utilized the previous report (2002) by the Economic Development Committee to inform their analysis of the economic issues involved with Upper Pier Avenue.

Again, with an eye towards developing a pedestrian-friendly “village center” on Upper Pier Avenue, the Sub-committee made the following recommendations:
■ Create an Economic Development Commission (“EDC”) to address commercialism on Upper Pier Avenue, PCH, and other areas of the City
■ Explore the use of professional consultants to assist the EDC in attracting “village friendly” businesses to Hermosa Beach
■ Create incentives for second floor professional services to create more opportunities for ground floor, pedestrian-friendly retail uses
Additionally, one of the main concerns both the business owners and the property owners voiced during their meetings with the Sub-committee regarded “down-time” they would incur during construction on Upper Pier Avenue. The Sub-committee and City Staff agreed to coordinate with the businesses on Upper Pier to mitigate any negative effects of construction, and to provide a point-of-contact at the City who would be available to businesses during the construction phase.

UPAC – Final Report Page 9
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VI. Next Steps
The recommendations set forth in this Final Report represent more than a year of analysis, discussion and compromise by the UPAC. The Committee went to great lengths to gather and synthesize data from residents, businesses, property owners, and staff.

With all of the above-considerations in mind, UPAC respectfully makes the following recommendations to the City Council:

1. Approve the UPAC’s Traffic, Parking and Circulation recommendations. a.) Authorize the Public Works Director to solicit Requests for Proposals to select design consultants to prepare plans, specifications, and cost estimates for all street and landscaping improvements. (Note: The Committee recommends utilizing architects Dean Nota and Larry Peha to serve on the Selection Committee along with Public Works Staff.)
b.) Direct the Public Works Commission to provide guidance in developing streetscape/public facilities commensurate with the recommendations set forth in the UPAC Final Report.
c.) Direct Staff to report to Council within 180-days following the award of the design contract with preliminary plans, cost estimates, and design recommendations.

2. Authorize the Director of Public Works to implement the “scramble” cross walk at the intersection of Pier Avenue and Hermosa Avenue.

3. Refer to the Planning Commission the UPAC report with guidance to develop zoning and parking guidelines to facilitate the goals articulated in UPAC’s Final Report. (Final report regarding changes to the zoning code, parking, etc., to the City Council due within 9 months of City Council approval.)

4. Create an Economic Development Commission.

5. Maintain the UPAC as an advisory/ad hoc committee as required. # # #
UPAC – Final Report Page 10
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City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0379
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022

ADOPTION OF ECONOMIC DEVELOPMENT STRATEGY
(Interim Community Development Director Angela Crespi)
Recommended Action:

Staff recommends City Council:

1. Receive a staff presentation and public comments;

2. Approve a resolution (Attachment 1) adopting an Economic Development Strategy; and

3. Direct staff to begin work on identified first year implementation priorities.

Executive Summary:

At its April 28, 2020 meeting, City Council approved the creation of the Economic Development Committee with a two-year sunset date. Once formed, the earliest actions of the committee were to form an Economic Development Stakeholders Advisory Working Group, comprised of business representatives and commercial property owners, and to discuss urgent matters related to the pandemic. Soon after, the committee directed development of an Economic Development Strategy as specified in the Governance Element of PLAN Hermosa.

On May 2, 2022, the Economic Development Committee held its final meeting at which the committee considered, and approved, the Economic Development Strategy. The proposed strategy is hereby presented for final adoption by the City Council.

Background:

The Economic Development Strategy is the result of two years of collective efforts by the Economic Development Committee, Stakeholders Advisory Working Group, Community Development Department staff, and City Manager’s Office to identify Economic Development objectives and actions. Over the course of the last two years, the Economic Development Committee met monthly and the Stakeholders Advisory Working Group met twice per month to explore and discuss Hermosa Beach business-related topics.

An Economic and Market Study (Attachment 4) was prepared to inform the Economic Development Committee and Stakeholders for preparation of the Economic Development Strategy.

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The resulting Economic Development Strategy (Attachment 2) includes 30 strategic actions. These actions include steps that the City can take to enhance Hermosa Beach and strengthen the local economy through beautification; code changes; and other pro-active steps to encourage success and help our business partners as they serve and enhance quality of life in our community.

Past City Council, Commission, and Committee Actions
Meeting Date Description
March 4, 2020 A joint meeting of the City Council and Planning Commission was held to discuss a vision for the Downtown District, among other topics. At that meeting, it was suggested that a
subcommittee be formed, comprised of two City
Councilmembers and two Planning Commissioners to focus
on Economic Development.

April 21, 2020 Planning Commission selected Peter Hoffman and David Pedersen to be appointed as Planning Commission
representatives to the proposed committee.

April 28, 2020 City Council established the Economic Development Committee and selected Mary Campbell and Michael Detoy
to be appointed as City Council representatives, with a twoyear sunset date.

June 1, 2020 Economic Development Committee held its first monthly meeting to begin work on short-term economic recovery goals and long-term Economic Development goals to benefit the Downtown and citywide business districts. At the first
meeting, the Economic Development Committee determined
that a Stakeholders Advisory Group be formed to represent a variety of businesses and commercial districts.

September 28, 2021 City Council Received a One-Year Progress Report on the Economic Development Committee and Economic
Development Strategy initial actions approved.

May 2, 2022 Economic Development Committee held its final meeting at which the committee considered, and approved, the
Economic Development Strategy.

Analysis:

The Economic Development Committee and the Stakeholders Advisory Working Group identified 30 strategic actions in the Economic Development Strategy, including 10 priorities for implementation in the first year. The strategic actions are divided into five categories: Citywide Beautification; City of Hermosa Beach Page 2 of 5 Printed on 9/12/2022
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the first year. The strategic actions are divided into five categories: Citywide Beautification; Downtown; Municipal Code Amendments; Business Outreach; and City Economic Development work program.

The Economic Development Strategy is a long-term plan, with strategic actions divided into shortterm (1st year), mid-term (2-3 years) or long-terms (3+ years) implementation. If approved by City Council, the Economic Development Strategy would become the work plan for implementation, beginning with the identified action priorities. A list of Economic Development Strategy First-Year Implementation Priorities is included as Attachment 3.

Implementation work would be completed by staff, the Hermosa Beach Chamber of Commerce and Visitors Bureau, and occasionally with consultant assistance as described the Economic Development Strategy. The Economic Development Strategy includes an action to report to the City Council twice annually to monitor progress, prioritize actions, and consider new opportunities. This biannual report would ensure that the Council and community are updated on Economic Development Strategy implementation.

General Plan Consistency:

PLAN Hermosa, the City’s General Plan, was adopted by the City Council in August 2017. The Economic Development Strategy supports several PLAN Hermosa goals and policies listed below.

Governance Element
Goal 6. A broad-based and long-term economic development strategy for Hermosa Beach that supports existing businesses while attracting new business and tourism.

Policies:
· 6.1 Long-term economic development. Support the development and implementation of long-term economic development strategies that seek to establish and keep new businesses and a strong middle class in Hermosa Beach over the decades to come. · 6.2 Regional presence. Encourage economic development strategies that will make Hermosa Beach a driving force and jobs center behind the regional economy of the South Bay region. · 6.3 Diversified economy. Encourage economic development strategies that allow the city to move beyond reliance on its two main industries - accommodation and food service and retail trade - and transform itself to a mature mix of economic activity and job opportunities. · 6.4 Business support. Support the Chamber of Commerce, retailers, tourist service businesses, artists, and other agencies to develop an aggressive marketing strategy with implementation procedures.
· 6.5 Creative economy. Prioritize strategies that will create an economy full of diverse talents, trades and goods for the city. For long lasting economic success, a range of services, arts, City of Hermosa Beach Page 3 of 5 Printed on 9/12/2022
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entertainment and retail should be supported on all scales of the city’s economy. · 6.6 Pop-up shops. Develop plans and programs for underutilized spaces, such as vacant buildings, utility corridors, parkways, etc., for temporary retail, restaurant, and community promoting uses.
· 6.7 Retail base. Encourage economic development reflective of the character of Hermosa Beach with small and medium scale retail development within Hermosa Beach in order to create a stronger tax base and increase the City’s tax revenue.

Land Use Element
Goal 1. Create a sustainable urban form and land use patterns that support a robust economy and high quality of life for residents.

Policies:
· 1.1 Diverse and distributed land use patterns. Strive to maintain the fundamental pattern of existing land uses, preserving residential neighborhoods, while providing for enhancement of corridors and districts in order to improve community activity and identity. · 1.4 Diverse commercial areas. Promote the development of diversified and unique commercial districts with locally owned businesses and job- or revenue-generating uses. · 1.5 Balance resident and visitor needs. Ensure land uses and businesses provide for the needs of residents as well as visitors.
· 1.8 Respond to unique characteristics. Enhance the unique character and identity of the city’s neighborhoods, districts and corridors through land use and design decisions. Allow policies and programs to be focused on each unique character area of the city.

Goal 3. A series of unique, destination-oriented districts throughout Hermosa Beach.

Policies
· 3.1 Unique districts. Encourage the development of local and city-wide districts and centers that address different community needs and market sectors and complement surrounding neighborhoods.
· 3.3 Diverse retail and office centers. Provide incentives to transform existing singleuse commercial properties that are accessible into retail destinations by adding a diversity of uses, providing new pedestrian connections to adjacent residential areas, reducing the visual prominence of parking lots, making the centers more pedestrian-friendly and enhancing the definitions and character of street frontage and associated streetscapes. · 3.4 Emerging employment sectors. Strive to create districts that support increased employment activity, particularly for growing or emerging economic sectors. · 3.5 Compact office formats. New employment uses should be designed in a compact format with minimal front setbacks from the street, typical lease spans of 40 feet or less, and where feasible, combined with other commercial uses.

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Fiscal Impact:

There is no fiscal impact associated with recommended action to adopt the proposed Economic Development Strategy. Any costs associated with implementation would be included in the annual budget adoption process. Adoption and implementation of an Economic Development Strategy would be expected to increase City revenues and strengthen the local economy.

Attachments:

1. Draft Resolution

2. Economic Development Strategy-Resolution Exhibit A

3. Economic Development Strategy First Year Implementation Priorities

4. Economic and Market Study by Economic and Planning Systems, Inc.

5. Link to March 4, 2020 City Council and Planning Commission Joint Meeting Agenda

6. Link to April 21, 2020 Planning Commission Agenda

7. Link to April 28, 2020 City Council Staff Report

8. Link to June 1, 2020 Economic Development Committee Staff Report

9. Link to September 28, 2021 City Council Staff Report

10.Link to May 2, 2022 Economic Development Committee Staff Report Respectfully Submitted by: Christy Teague, Senior Planner and Business Liaison Concur: Angela Crespi, Interim Community Development Director Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
City of Hermosa Beach Page 5 of 5 Printed on 9/12/2022
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RESOLUTION NO. 22-XXXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH,

CALIFORNIA ADOPTING AN ECONOMIC DEVELOPMENT STRATEGY

THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA,

DOES HEREBY RESOLVE AS FOLLOWS
Section 1. Findings.

A. The Economic Development Committee was established by the Hermosa Beach City Council at its meeting held on April 28, 2020.

B. By direction of the Economic Development Committee, an Economic Development Strategy has been prepared including actions intended to enhance the City and strengthen the local economy through Citywide Beautification, Downtown Initiatives, Municipal Code Amendments, Business Outreach, and a City Economic Development work program.

C. The Economic Development Committee approved the Economic Development Strategy and recommended the City Council adopt the Economic Development Strategy at its meeting held on May 2, 2022.

SECTION 2. Based on the foregoing findings, the City Council hereby approves the Economic Development Strategy attached hereto as Exhibit A and incorporated herein by reference.

SECTION 3. This Resolution shall take effect immediately. The City Clerk shall certify to the passage and adoption of this Resolution; shall cause the original of the same to be entered among the original resolutions of the City Council; and shall make a minute of the passage and adoption thereof in the minutes of theCity Council meeting at which the same is passed and adopted.

PASSED, APPROVED and ADOPTED this 14
th day of June, 2022.
____________________________________________________________________________ PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, California ATTEST: APPROVED AS TO FORM:
522

___________________________________ _____________________________ Myra Maravilla, City Clerk Michael Jenkins, City Attorney

EXHIBIT A

ECONOMIC DEVELOPMENT STRATEGY
523
524
Hermosa Beach Economic Development Strategy
Introduction
Economic Development is different in each city according to its unique needs and opportunities. This Hermosa Beach Economic Development Strategy identifies a path forward as we emerge from the pandemic and post-pandemic recovery poised to facilitate business success, strengthen the local economy and improve quality of life for residents.

The Economic Development Committee directed development of a long-term Economic Development Strategy, as stated in PLAN Hermosa under Governance Goal 6: A broad-based and long-term economic development strategy for Hermosa Beach that supports existing businesses while attracting new business and tourism.

This plan will be implemented by City departments in collaboration with the Hermosa Beach Chamber of Commerce, input from the community and, in some cases, with the help of professional consultants.

Regular review with the City Council will monitor progress and provide a system to update priorities and identify new Economic Development opportunities.

Some business-friendly initiatives put in place to serve the business community are included under the category of “City Economic Development Work Program” to ensure they are continued.

Preparation of the Economic Development Strategy
The Economic Development Strategy is the result of more than a year of work with the Economic Development Committee and Stakeholders Advisory Working Group to identify Economic Development Strategy objectives and actions, supported by the City Manager’s Office and Community Development Department staff. Monthly Economic Development Committee meetings and twicemonthly Stakeholders Advisory Working Group explored and discussed relevant Hermosa Beach topics, including Gateways and Corridors, Downtown issues, Tourism, Special Events, Arts and Culture, Music and Entertainment, and Placemaking.

The Economic Development Strategy includes strategic actions; steps the City can take to enhance Hermosa Beach and strengthen the local economy through beautification, code changes, and other pro-active steps to build relationships through listening to property owners and businesses to encourage investment, business expansion and success.

The strategic actions are divided into five categories: Citywide Beautification, Downtown, Municipal Code Amendments, Business Outreach, and City Economic Development Work Program. 525
Economic and Demographic Conditions
Hermosa Beach Demographics
2010 2020
526
Hermosa Beach Employment
Hermosa Beach has more than 1,000 businesses in commercial spaces and home-based, large and small. Hermosa Beach has 12,290 workers living within its borders who work across 13 major industrial sectors. The table below shows the types of jobs they hold. The most prevalent occupational category in Hermosa Beach is Management, in which 7,580 (61.7% of total) employees work. The second-most prevalent type of work is in Sales, which employs 2,966 (24.1% of total) in Hermosa Beach.

Employment by Occupation – Hermosa Beach
Hermosa Beach as Bedroom Community
Hermosa Beach is considered a “bedroom community,” since more residents travel outside the city for work than individuals who travel to Hermosa Beach to work, with a daily net outflow of 2,475, as shown in the below table. This contributes to a smaller daytime population, especially in comparison to the adjacent Manhattan Beach, which has a daily net gain of 4,377.

However, work-from-home trends may reduce employee outflow and allow more of the community to support local businesses during the day, including for in-person meetings for coffee or lunch.

Additionally, when the Skechers North American headquarters is completed in 2023 – located at the expanded campus in Manhattan Beach and Hermosa Beach – an addition 700 employees will be in the area to support businesses with lunch and shopping during the day. These encouraging factors promise to add business and foot traffic during the daytime.
527
Hermosa Beach Daytime Population
Hermosa Beach Tourism
Visitors support local businesses and help to attract the types of businesses that residents also enjoy.

Overnight visitors pay a 14% Transient Occupancy Tax (TOT) to support city services such as the pier, beaches, parks, police and fire services, and reduce cost impacts to residents.

During the most recent City Council budget review held March 22, 2022, it is expected that 2021-2022 TOT revenues will recover to pre-pandemic levels to approximately $3.5 million.

The Hermosa Beach Chamber of Commerce and Visitors Bureau has plans to focus on attracting new overnight visitors to further support local businesses and increase awareness of Hermosa Beach as an overnight visitor destination.

Hermosa Beach Transient Occupancy Tax (TOT)
528
Two small hotels are under construction at 70 10th Street with 6 rooms and 66 11th Street with 9 rooms, which will expand visitor hotel choice and add to the Hermosa Beach hotel room inventory, currently from 480 to 495 rooms.

Hermosa Beach Hotels
Name Year Built Category Rooms
Beach House 1998 Luxury 96
Grandview Inn 1973 Economy 17
H2O Hermosa 2020 Mid-Range 30
Hampton Inn 2002 Economy 70
Holiday Inn Express 2001 Economy 80
Hotel Hermosa 1990 Mid-Range 80
Quality Inn 1986 Economy 39
Sea Sprite Ocean Front Hotel 1957 Mid-Range 39
480
Economic Development Strategic Actions
Strategic Actions have been sorted into five broad categories to ensure regular progress in each area.

Citywide Beautification
1 Wayfinding Signs
Objective: Inform and direct visitors from PCH, Aviation and Artesia to beach, pier, parking, business districts and add to sense of place.

Difficulty: Easy
Priority Timeline: 1st Year
Performance Measures: Implement wayfinding sign program along corridors and in Downtown with sidewalk details, QR codes or other pedestrian-level signs, including City branding, Responsible Staff: Public Works, City Manager’s Office, Chamber of Commerce 2 Façade Improvement Program for commercial districts
Objective: Private property investment to improve appearance of older buildings in need of refreshed exteriors.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
529
Performance Measures: Proactive outreach to property owners, Identify funding source (CDBG, Grants), Establish program with architect assistance. Program to be catalyst for improvements, encouraging new investment reducing vacancy rates, increasing property values and providing a more welcoming atmosphere.

Responsible Staff: Community Development
3 Beautification Program, including gateway entries and corridors. Seek funding sources for improvements.

Objective: Improve community quality of life, sense of pride and City image, improve appearance of all areas of Hermosa Beach.

Difficulty: Medium
Priority Timeline: Within 2-3 Years
Performance Measures: Seek street view enhancements at every opportunity, Identify and incorporate beautification projects in annual CIP budget. Seek quality private developments.

Beautification is an investment in the City to add sales tax, increase hotel occupancy rates and TOT collections, reduce vacancy rates and increase property values.

Responsible Staff: Public Works, Community Development, City Manager’s Office 4 Beautification Awards
Objective: Celebrate and encourage improvements.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Annual recognition of new or improved private and public spaces.

Responsible Staff: Mayor’s Award or Chamber of Commerce 5 Consider Arts in Public Places Program
Objective: Arts in Public Places ordinance to add public art as part of private development to increase beautification with new projects.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Arts in Public Places ordinance to add public art as part of private development to increase beautification with new projects.

Responsible Staff: Community Development, Community Resources, Chamber of Commerce. 530
6 Placemaking Community Forum, including City Council, Planning Commission and Parks, Recreation and Community Resources Advisory Commission.

Objective: Consider Placemaking principles as decision making tool for staff and commissions.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Placemaking includes activating underutilized spaces and gathering places, improving area attractiveness for all ages and abilities, and including community in decision making. BIDs can also be considered in other areas of the City.

Responsible Staff: Community Development, City Manager’s Office, Public Works, Community Resources
7 Placemaking Project Design. The City to include community through public engagement.

Objective: Community involvement in design ensures area will be enjoyed, promotes local pride and quality of life.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Training and citywide approach to seek opportunities to include community input and neighborhood enhancement opportunities.

Responsible Staff: Community Development, City Manager’s Office, Public Works, Community Resources
8 Include Beautification-related projects in the City budget and CIP to add value and for residents and visitors to enjoy. Investment in the public realm improves community quality of life and welcomes visitors.

Objective: Improve public areas appearance to enhance community quality of life and City image
and attract visitors.

Difficulty: Medium or Difficult depending on projects
Priority Timeline: Within 2-3 Years or More than 3 years depending on projects Performance Measures: Results in increased commercial and residential property values and community pride, Increased hotel occupancies, City transient occupancy tax and sales tax collection
Responsible Staff: Public Works, Finance
531
Downtown
9 Work with Business Community to Explore Formation of a Business Improvement District (BID).

Objective: Facilitate BID if desired by Downtown property owners and/or businesses. A BID can fund activities beyond City services identified by property owners and/or businesses.

Difficulty: Medium
Priority Timeline: 1st Year
Performance Measures: Initial information meeting, determine which type of BID to establish, form advisory committee to identify activities needed and associated costs to determine assessments.

Responsible Staff: Community Development, City Manager’s Office, Chamber of Commerce 10 Focused Update of Downtown Revitalization Strategy, including Preservation of Downtown Retail and Restaurants and other active uses on 1st floor.

Objective: Review document to determine what needs to be completed or added. Economic market study completed in 2021 can inform updated Downtown Revitalization Strategy.

Difficulty: Medium
Priority Timeline: 1st Year
Performance Measures: An updated strategy that aligns with emerging trends that sets the stage for a sustainable and vibrant economic future. Add incentives for active uses on 1st floor in Downtown with new Zoning Code. Will need consultant assistance after RFP and selection.

Responsible Staff: Community Development, Public Works, City Manager’s Office, Consultant 11 Develop Identity/Vision for the Downtown
Objective: Incorporate City brand with marketing and future improvements.

Difficulty: Medium
Priority Timeline: 1st Year
Performance Measures: Consistent with PLAN Hermosa and Downtown Revitalization Strategy.

May be considered concurrent with Update of Downtown Revitalization Strategy. Would require RFP and consultant contract with public outreach.

Responsible Staff: Community Development, Public Works, City Manager’s Office, Consultant, Chamber of Commerce
532
12 Comprehensive Downtown lighting evaluation with complete photometric study, design and installation. This requires a new CIP request for funding, community input for desired lighting, and public review.

Objective: Lighting plan for Downtown with overall vision to create safe and welcoming atmosphere.

Difficulty: Easy
Priority Timeline: 1st Year
Performance Measures: Include in CIP budget, RFP, include public input process in contract.

This could be an example for other areas of the City in future.

Responsible Staff: Public Works, Consultant
13 Introduce and Facilitate Downtown Experiences (activate public spaces, add interest for residents and visitors)
Objective: Enhance the special sense of place Downtown to add vibrancy and attract new business interest and investment
Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Seek opportunities for art, music and special experiences in identified Downtown locations. Added foot traffic to add customers and increase sales tax, increase hotel occupancy rates and TOT collections, reduce vacancy rates and increase property values.

Responsible Staff: Community Development, Public Works, City Manager’s Office, Community Resources, Chamber of Commerce
Municipal Code Amendments
14 Permanently Allow Outdoor Dining Areas and Lane Reconfigurations Objective: To add vibrancy of public and private outdoor spaces, enhance sense of place and continue to offer outdoor options safely and comfortably. To move traffic at safer speeds and encourage all mobility options.

Difficulty: Medium
Priority Timeline: 1st Year
Performance Measures: City Council ordinance to change codes, CEQA analysis, CA Coastal Commission approval. Require encroachment rental fees and standards, including appearance, and to allow commercial use if not in use by business.
533
Responsible Staff: Public Works, Community Development, City Manager’s Office 15 Long Term Allowance of Outdoor Music in Business Locations Objective: Allow temporary outdoor music to become permanent to attract customers, add vitality and provide unique Hermosa Beach atmosphere.

Difficulty: 2-Medium
Priority Timeline: 1st Year
Performance Measures: Amend Title 17 (Zoning). Include with permanently allowed Outdoor Dining.

Responsible Staff: Community Development, Public Works
16 Program to Allow Outdoor Music in Public Spaces
Objective: Add vibrancy and sense of place to enhance Downtown Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Develop program with designated spaces and hours for scheduled musicians. Municipal code amendments (Title 12 Streets, Sidewalks and Public Places).

Responsible Staff: Community Resources, Public Works, Community Development, Police Department, Chamber of Commerce
Business Outreach
17 Regular Communication with Key Property Owners to Encourage Reinvestment and Provide Support as Needed
Objective: Meet with property owners of prime commercial sites to discuss status and opportunities.

Difficulty: Easy
Priority Timeline: 1st Year
Performance Measures: 4 meetings per year. Work with property owners to overcome obstacles to property improvements and investment.

Responsible Staff: Community Development, City Manager’s Office, City Council Representative, Chamber of Commerce
18 Develop Business Visitation Program
Objective: Build relationships with businesses, understand and better meet needs. 534
Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Schedule regular visits to a variety of businesses such as large employers, sales tax generators, high-visibility businesses. LAEDC can supplement City efforts with business check-in calls.6-10 visits per year
Responsible Staff: Community Development, City Manager’s Office, City Council Representative, Chamber of Commerce
19 Annual Commercial Property Owner and Brokers Forum
Objective: Create opportunity to communicate with property owners and brokers to share project updates, City updates and real estate trends.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Recognize roles of property owners, brokers and City to strengthen communications and relationships through annual meeting.

Responsible Staff: Community Development, City Manager’s Office, City Council, Chamber of Commerce
City Economic Development Work Program
20 Shop Local Program
Objective: Encourage residents to support local businesses year-round to retain and grow businesses and strengthen local economy.

Difficulty: Easy
Priority Timeline: 1st Year
Performance Measures: Work with Chamber to promote local businesses through social media and other communications at holiday season, ‘Small Business Saturday” and at every opportunity year-round.

Responsible Staff: Community Development, City Manager’s Office, Chamber of Commerce 21 Provide Hermosa Beach business information to event promoters to encourage use of local vendors and distribution to participants.

Objective: Gain additional business support from day visitors attending events.

Difficulty: Easy
535
Priority Timeline: 1st Year
Performance Measures: Develop virtual business map with services provided and hours of operation to event promoters to encourage year-round patronage of local businesses.

Responsible Staff: Community Resources, Community Development, GIS, Chamber of Commerce
22 Retail Attraction Program for Competitive, Strengthened Retail Objective: Help recruit new businesses to reduce vacancies, increase foot traffic and strengthen local economy.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Identify vacancies, communicate with property owners, help recruit businesses to reduce vacancies, increase property values and maintain and increase sales tax revenue.

Responsible Staff: Community Development, City Manager’s Office, Chamber of Commerce 23 Partnership with Chamber of Commerce to enhance Visitors Bureau to develop and promote the Hermosa Beach brand and provide visitor resources.

Objective: Promote Hermosa Beach as an overnight destination.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Increase overnight visitors to support businesses year-round, increase hotel occupancy and City transient occupancy taxes. Visitors support local businesses that residents also enjoy and strengthen the local economy.

Responsible Staff: City Manager’s Office, Chamber of Commerce 24 Periodic Community Survey to Determine What Types of Shops or Goods are Desired and Residents Drive Out of Town to Patronize
Objective: Survey information to identify gaps in services or goods provided for business attraction. Survey information is a helpful tool in business recruitment since community seeks certain types of business and shows market demand.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
536
Performance Measures: Biennial survey to inform existing businesses of market needs and to help attract new businesses to reduce vacancies.

Responsible Staff: Community Development, City Manager’s Office, Chamber of Commerce 25 Explore Music Events and Activities to Celebrate Hermosa Beach Music History and Provide Musical Experiences for Community and Visitors
Objective: Celebrate unique local musical heritage for community pride and to distinguish Hermosa Beach to visitors.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Incorporate musical history into events and create new events. Events in non-summer season could attract visitors in the non-peak summer season and increase sales tax, increase hotel occupancy rates and TOT collections and strengthen local economy and Hermosa Beach brand.

Responsible Staff: Community Resources, Historical Society and Museum, Chamber of Commerce
26 Development Assistance Committee/Development Review Committee Objective: Provide early feedback and information to developers.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Formalize and promote pre-development meeting process. Early information establishes relationships and reduces development processing time.

Responsible Staff: Community Development, Public Works, Police, LA Fire as needed 27 Provide customer service training to all City staff to build a culture of excellent customer service.

Objective: Provide highest quality service to residents and businesses.

Difficulty: Easy
Priority Timeline: Within 2-3 Years
Performance Measures: Provide comprehensive customer service training with periodic updates. Include customer service consideration for job candidates. Build on shared City culture of excellent customer service by all employees.

Responsible Staff: City Manager’s Office, Human Resources 537
28 Continuous improvements to streamline processes and reduce approval times for permit processes.

Objective: Provide certainty and reduce approval times through efficiencies.

Difficulty: Easy
Priority Timeline: In Process
Performance Measures: Seek continuous staff efficiencies, Periodic Process Improvements Workshops, 1-2 per year
Responsible Staff: Community Development, Public Works, City Manager’s Office 29 Continue staff member assigned as Business Liaison
Objective: Point of contact to assist new and expanding businesses.

Difficulty: Easy
Priority Timeline: In Process
Performance Measures: Timely response to inquiries, referrals, maintain email business@ hermosabeach.gov
Responsible Staff: Community Development
30 Regular City Council Review
Objective: Continue citywide Economic Development program.

Difficulty: Easy
Priority Timeline: Continuous
Performance Measures: City Council review with identification of priorities and workplan in January and July each year to ensure progress on Economic Development Strategy Responsible Staff: Community Development, City Manager’s Office Economic Development Strategy Implementation
Implementation
The matrix below shows the Economic Development actions and ease to implement in five categories:

Citywide Beautification, Downtown, Municipal Code Amendments, Business Outreach and City Economic Development Work Program. These are rated at 1-Easy, 2-Medium and 3-Difficult. These ratings are based on factors such as budget costs, time required to complete, and level of complication including if the City will need to work with consultants or other agencies such as Coastal Commission 538
and CalTrans. This does not consider staff capacity; for example, all of the easy-rated actions could not be included in the staff work plan and completed at the same time.

Priority/Timeline
Actions’ priority and work plan determine which actions should be completed first. These are rated AWithin 1 Year, B-Within 2-3 Years, C-More than 3Years. An example of an action that is a priority but not rated as easy to implement is the “Permanently Allow Outdoor Dining” since the action requires ordinances to amend the municipal code, environmental analysis, and Coastal Commission. It is not easy to implement but has been identified as a priority. This is a working document and priorities may change as needed with periodic review.

Staff Assigned
The matrix below identifies who will be implementing the actions, including: CMO-City Manager’s Office, CD-Community Development, PW- Public Works, CR-Community Resources, PD-Police Department, and HR-Human Resources. The Chamber of Commerce and professional consultants are listed here to also work on strategic actions.

Continue Programs in Place
The Economic Development Strategy does not address or recommend changes to sustainability actions in place, including the successful Green Business Program and actions recognized as Blue City activities to continue protecting healthy waterways and oceans.

Regular City Council Review
For an Economic Development program to be successful, it needs to be a citywide priority and include multiple departments. A regular review of the Economic Development Strategy and prioritization of the work plan early in the year and mid-year ensures that the plan will continue, and Economic Development will be maintained as a City priority as intended in PLAN Hermosa. 539

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS

CITYWIDE

BEAUTIFICATION
1 Wayfinding Signs Inform and direct
visitors from PCH,
Aviation and Artesia to
beach, pier, parking,
business districts and
add to sense of place.

PW,
CMO,
Chamber
1 A
Timing
will need
to include
public
input
Implement wayfinding
sign program along
corridors and in
Downtown with
sidewalk details, QR
codes or other
pedestrian-level signs,
including City branding,
Include in CIP budget.

This may be two
different projects.
2 Beautification Program,
including gateway entries
and corridors. Seek
funding sources for
improvements.

Improve community
quality of life, sense of
pride and City image,
improve appearance of
all areas of Hermosa
Beach.

PW, CD,
CMO
2 3 for major
projects such
as sidewalks,
streets or
underground
utilities
B
B
for these
items
beyond
initial
funding
Seek street view
enhancements at every
opportunity, Identify
and incorporate
beautification projects
in annual CIP budget,
Seek quality private
developments.

Beautification is an
investment in the City
to add sales tax,
increase hotel
occupancy rates and
TOT collections, reduce
vacancy rates and
540

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
3 increase property
values.
3 Façade Improvement
Program for commercial
districts.

Private property
investment to improve
appearance of older
buildings in need of
refreshed exteriors.

CD 1 B Proactive outreach to
property owners,
Identify funding source
(CDBG, CIP, Grants)
Establish program
(architect assistance?).

Program to be catalyst
for improvements,
encouraging new
investment reducing
vacancy rates,
increasing property
values and providing a
more welcoming
atmosphere.
4 Beautification Awards Celebrate and
encourage
improvements.

Mayor’s
Award or
Chamber
1 B Annual recognition of
new or improved
private and public
spaces.
5 Consider Arts in Public
Places Program
AIPP would require
public art as part of
major commercial
developments as part
of citywide
beautification.

CD, CR,
Chamber
1 B Arts in Public Places
ordinance to add public
art as part of private
development to
increase beautification
with new projects.
541

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
4 6 Include beautificationrelated projects in the
City budget and CIP to
add value and for
residents and visitors to
enjoy. Investment in the
public realm improves
community quality of life
and welcomes visitors.

Improve public areas
appearance to enhance
community quality of
life and City image
and attract visitors.

PW,
Finance
1 2-3
depending
on projects
B
B-C
depending
on
projects
Results in increased
commercial and
residential property
values and community
pride, Increased hotel
occupancies, City
Transient Occupancy
Taxes and sales tax
collection
7 Placemaking Community
Forum, including City
Council, Planning
Commission and Parks,
Recreation and
Community Resources
Advisory Commission.

Consider Placemaking
principles as decision
making tool for staff
and commissions.

CD, CMO,
PW, CR
1 B Placemaking includes
activating underutilized
spaces and gathering
places, improving area
attractiveness for all
ages and abilities, and
including community in
decision making.
8 Placemaking Projects
Design. The City to
include community
through public
engagement.

Community
involvement in design
ensures area will be
enjoyed, promotes
local pride and quality
of life.

CD, CMO,
PW, CR
1 B Training and citywide
approach to seek
opportunities to
include community
input and
neighborhood
enhancement
opportunities.

DOWNTOWN
9 Work with Business
Community to Explore
Facilitate BID if desired
by Downtown property

CD, CMO
Chamber
2 A Initial information
meeting, determine
542

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
5 Formation of Business
Improvement District
(BID)
owners and businesses.

A BID can fund
activities beyond City
services identified by
property owners
and/or businesses.
which type of BID to
establish, form
advisory committee to
identify activities
needed and associated
costs to determine
assessments. BIDs can
also be considered in
other areas of the City.
10 Focused Update of
Downtown Revitalization
Strategy, including
Preservation of
Downtown Retail and
Restaurants and other
active uses on 1st floor
Review document to
determine what needs
to be completed or
added. Economic
market study
completed in 2021 can
inform updated
Downtown
Revitalization Strategy.

CD, PW,
CMO,
Consultant
2 A An updated strategy
that aligns with
emerging trends that
sets the stage for a
sustainable and vibrant
economic future.

Add incentives for
active uses on 1st floor
in Downtown with new
Zoning Code. Will need
consultant assistance
after RFP and selection.
11 Develop Identity/Vision
for the Downtown
Incorporate City brand
with marketing and
future improvements.

CMO, CD
PW,
Chamber,
Consultant
2 A Consistent with PLAN
Hermosa and
Downtown
Revitalization Strategy.

May be considered
concurrent with
Update of Downtown
543

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
6 Revitalization Strategy.

Would require RFP and
consultant contract
with public outreach.
12 Comprehensive
Downtown lighting
evaluation with complete
photometric study,
design and installation.

This requires a new CIP
request for funding,
community input for
desired lighting, and
public review.

Lighting plan for
Downtown with overall
vision to create safe
and welcoming
atmosphere.

PW,
Consultant
1 A Include in CIP budget,
RFP, include public
input process in
contract.

This could be an
example for other
areas of the City in
future.
13 Introduce and Facilitate
Downtown Experiences
(activate public spaces,
add interest for residents
and visitors)
Enhance the special
sense of place
Downtown to add
vibrancy and attract
new business interest
and investment.

CD, PW,

CMO, CR,
Chamber
1 B Seek opportunities for
art, music and special
experiences in
identified Downtown
locations. Added foot
traffic to add
customers and increase
sales tax, increase
hotel occupancy rates
and TOT collections,
reduce vacancy rates
and increase property
values.
544

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
7 14 Permanently Allow
Outdoor Dining Areas
and Lane
Reconfigurations
To add vibrancy of
public and private
outdoor spaces,
enhance sense of place
and continue to offer
outdoor options safely
and comfortably. To
move traffic at safer
speeds and encourage
all mobility options.

CD, PW,
CMO
2 A City Council ordinance
to change codes, CEQA
analysis, CA Coastal
Commission approval.

Require encroachment
rental fees and
standards, including
appearance, and to
allow commercial use if
not in use by business.
545

STRATEGIC ACTION OBJECTIVE STAFF EASE TO

IMPLEMENT/

DIFFICULTY
1-Easy
2-Medium
3-Difficult

PRIORITY/

TIMELINE
A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS

MUNICIPAL CODE

AMENDMENTS
15 Long Term Allowance of
Outdoor Music in
Business Locations
Allow temporary
outdoor music to
become permanent to
attract customers, add
vitality and provide
unique Hermosa Beach
atmosphere.

CD,
PW
2 A Amend Title 17
(Zoning). Include with
permanently allowed
Outdoor Dining.
16 Program to Allow
Outdoor Music in Public
Spaces
Add vibrancy and sense
of place to enhance
Downtown.

CR, PW,

CD, PD,
Chamber
1 B Develop program with
designated spaces and
hours for scheduled
musicians. Municipal
code amendments
(Title 12 Streets,
Sidewalks and Public
Places).

BUSINESS OUTREACH
17 Regular Communication
with Key Property
Owners to Encourage
Reinvestment and
Provide Support as
Needed
Meet with property
owners of prime
commercial sites to
discuss status and
opportunities.

CD, CMO,
CC rep.,
Chamber
1 A 4 meetings per year
Work with property
owners to overcome
obstacles to property
improvements and
investment.
18 Develop Business
Visitation Program
Build relationships with
businesses, understand
and better meet needs.

CD, CMO,
CC rep.,
Chamber
1 B Schedule regular visits
to a variety of
businesses such as
large employers, sales
tax generators, high546

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B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
9 visibility businesses.

LAEDC can supplement
City efforts with
business check-in
calls.6-10 visits per year
19 Annual Commercial
Property Owner and
Brokers Forum
Create opportunity to
communicate with
property owners and
brokers to share project
updates, City updates
and real estate trends.

CD, CMO,
CC,
Chamber
1 B Recognize roles of
property owners,
brokers and City to
strengthen
communications and
relationships through
annual meeting.

CITY ECONOMIC

DEVELOPMENT WORK

PROGRAM
20 Shop Local Program Encourage residents to
support local businesses
year-round to retain and
grow businesses and
strengthen local
economy.

CD, CMO,
Chamber
1 A Work with Chamber to
promote local
businesses through
social media and other
communications at
holiday season, ‘Small
Business Saturday” and
at every opportunity
year-round.
21 Provide Hermosa Beach
business information to
event promoters to
encourage use of local
Gain additional business
support from day
visitors attending
events.

CR, CD
GIS,
Chamber
1 A Develop virtual
business map with
services provided and
hours of operation to
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2-Medium
3-Difficult

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A-1st Year
B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
10 vendors and distribution
to participants.
event promoters to
encourage year-round
patronage of local
businesses.
22 Retail Attraction Program
for Competitive,
Strengthened Retail
Help recruit new
businesses to reduce
vacancies, increase foot
traffic and strengthen
local economy.

CD, CMO
Chamber
1 B Identify vacancies,
communicate with
property owners, help
recruit businesses.
to reduce vacancies,
increase property
values and maintain
and increase sales tax
revenue.
23 Partnership with
Chamber of Commerce
to enhance Visitors
Bureau to develop and
promote the Hermosa
Beach brand and provide
visitor resources.

Promote Hermosa
Beach as an overnight
destination.

CMO,
Chamber
1 B Increase overnight
visitors to support
businesses year-round
, increase hotel
occupancy and City
transient occupancy
taxes. Visitors support
local businesses that
residents also enjoy
and strengthen the
local economy.
24 Periodic Community
Survey to Determine
What Types of Shops or
Goods are Desired and
Survey information to
identify gaps in services
or goods provided for
business attraction.

CD, CMO,
Chamber
1 B Biennial survey to
inform existing
businesses of market
needs and to help
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2-Medium
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B-2-3 Years
C-3 Years+

PERFORMANCE

MEASURES
STATUS
11 Residents Drive Out of
Town to Patronize
Survey information is
helpful tool in business
recruitment since
community seeks
certain types of business
and shows market
demand.
attract new businesses
to reduce vacancies.
25 Explore Music Events and
Activities to Celebrate
Hermosa Beach Music
History and Provide
Musical Experiences for
Community and Visitors
Celebrate unique local
musical heritage for
community pride and to
distinguish Hermosa
Beach
to visitors.

CR,
Historical
Society
and
Museum,
Chamber
1 B Incorporate musical
history into events and
create new events.

Events in non-summer
season could attract
visitors in the non-peak
summer season and
increase sales tax,
increase hotel
occupancy rates and
TOT collections and
strengthen local
economy and Hermosa
Beach brand.
26 Development Assistance
Committee/Development
Review Committee
Provide early
feedback/info to
developers

CD, PW,
PD, Fire as
needed
1 B Formalize and promote
pre-development
meeting process. Early
information establishes
relationships and
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C-3 Years+

PERFORMANCE

MEASURES
STATUS
12 reduces development
processing time.
27 Provide customer service
training to all City staff to
build on culture of
excellent customer
service.

Provide highest quality
service to residents and
businesses.

CMO, HR, 1 A Provide comprehensive
customer service
training with periodic
updates. Include
customer service
consideration for job
candidates. Build on
shared City culture of
excellent customer
service by all
employees.
28 Continuous
improvements to
streamline processes and
reduce approval times
for permit processes.

Provide certainty and
reduce approval times
through efficiencies.

CD, PW,
CMO
1 In Process Seek continuous staff
efficiencies, Periodic
Process Improvements
Workshops
1-2 per year
29 Continue staff member
assigned as Business
Liaison
Point of contact to assist
new and expanding
businesses.

CD 1 In Process Timely response to
inquiries, referrals,
maintain email
business@
hermosabeach.gov
30 Regular City Council
Review
Continue citywide
Economic Development
program.

CMO, CD,
PW
1 Continuous City Council review
with identification of
priorities and workplan
in January and July
each year to ensure
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PERFORMANCE

MEASURES
STATUS
13 progress on Economic
Development Strategy
*CMO-City Manager’s Office, CD-Community Development, PW- Public Works, CR-Community Resources, CC – City Council representative, PDPolice Department, and HR-Human Resources. The Chamber of Commerce and professional consultants are listed here. 551
Economic Development Strategy as Implementation of PLAN Hermosa PLAN Hermosa, the City’s General Plan, was adopted by the City Council in August 2017. The Economic Development Strategy supports several PLAN Hermosa goals and policies that are listed below.

Governance Element
Goal 6. A broad-based and long-term economic development strategy for Hermosa Beach that supports existing businesses while attracting new business and tourism.

Policies:
• 6.1 Long-term economic development. Support the development and implementation of longterm economic development strategies that seek to establish and keep new businesses and a strong middle class in Hermosa Beach over the decades to come. • 6.2 Regional presence. Encourage economic development strategies that will make Hermosa Beach a driving force and jobs center behind the regional economy of the South Bay region. • 6.3 Diversified Economy. Encourage economic development strategies that allow the city to move beyond reliance on its two main industries – accommodation and food service and retail trade – and transform itself to a mature mix of economic activity and job opportunities. • 6.4 Business support. Support the Chamber of Commerce, retailers, tourist service businesses, artists, and other agencies to develop an aggressive marketing strategy with implementation procedures.
• 6.5 Creative economy. Prioritize strategies that will create an economy full of diverse talents, trades and goods for the city. For long lasting economic success, a range of services, arts, entertainment and retail should be supported on all scales of the city’s economy. • 6.6 Pop-up shops. Develop plans and programs for underutilized spaces, such as vacant buildings, utility corridors, parkways, etc., for temporary retail, restaurant, and community promoting uses. • 6.7 Retail base. Encourage economic development reflective of the character of Hermosa Beach with small and medium scale retail development within Hermosa Beach in order to create a stronger tax base and increase the City’s tax revenue.

Land Use Element
Goal 1. Create a sustainable urban form and land use patterns that support a robust economy and high quality of life for residents.

Policies:
552
• 1.1 Diverse and distributed land use patterns. Strive to maintain the fundamental pattern of existing land uses, preserving residential neighborhoods, while providing for enhancement of corridors and districts in order to improve community activity and identity. • 1.4 Diverse commercial areas. Promote the development of diversified and unique commercial districts with locally owned businesses and job- or revenue-generating uses. • 1.5 Balance resident and visitor needs. Ensure land uses and businesses provide for the needs of residents as well as visitors.
• 1.8 Respond to unique characteristics. Enhance the unique character and identity of the city’s neighborhoods, districts and corridors through land use and design decisions. Allow policies and programs to be focused on each unique character area of the city.

Goal 3. A series of unique, destination-oriented districts throughout Hermosa Beach. • 3.1 Unique districts. Encourage the development of local and city-wide districts and centers that address different community needs and market sectors and complement surrounding neighborhoods.
• 3.3 Diverse retail and office centers. Provide incentives to transform existing single-use commercial properties that are accessible into retail destinations by adding a diversity of uses, providing new pedestrian connections to adjacent residential areas, reducing the visual prominence of parking lots, making the centers more pedestrian-friendly and enhancing the definitions and character of street frontage and associated streetscapes. • 3.4 Diverse employment sectors. Strive to create districts that support increased employment activity, particularly for growing or emerging economic sectors. • 3.5 Compact office formats. New employment uses should be designed in a compact format with minimal front setbacks from the street, typical lease spans of 40 feet or less, and where feasible, combined with other commercial uses.
553
Thank You to All Who Contributed to This Economic Development Strategy Economic Development Committee
Councilmember Mary Campbell, Chair
Planning Commissioner Peter Hoffman, Vice Chair
Mayor Michael Detoy, Committee Member
Planning Commissioner David Pedersen, Committee Member
Economic Development Stakeholders Advisory Group
Jessica Accamando
Frank Buckley
Colin Cooley
Tony Cordi
Jon David
Dave Davis
Brian M. Dunne
Lori Ford
Bob Jones
Bob Lombardo
Anthony Morrison
Ron Newman
Peter Nolan
Laura Pena
Josh Royal
Bill Sigler
Stacy Straus
Jonathan M. Wicks
City Staff Economic Development Team
Suja Lowenthal
Ken Robertson
Angela Crespi
Melanie Hall
Doug Krauss
Carlos Luis
Sirinya Matute
Joe Sanclemente
Christy Teague
554
Economic Development Strategy
First Year Implementation Priorities
The below ten strategic actions are identified as priorities for implementation within the first year, including actions in all five categories.

Citywide Beautification
1 Wayfinding Signs
Downtown
9 Work with Business Community to Explore Formation of a Downtown Business Improvement District (BID).
10 Focused Update of Downtown Revitalization Strategy, including Preservation of Downtown Retail and Restaurants and other active uses on 1 st floor.
11 Develop Identity/Vision for the Downtown
12 Comprehensive Downtown lighting evaluation with complete photometric study, design and installation
Municipal Code Amendments
14 Permanently Allow Outdoor Dining Areas and Lane Reconfigurations 15 Long Term Allowance of Outdoor Music in Business Locations Business Outreach
17 Regular Communication with Key Property Owners to Encourage Reinvestment and Provide Support as Needed
City Economic Development Work Program
20 Shop Local Program
21 Provide Hermosa Beach business information to event promoters to encourage use of local vendors and distribution to participants. 555
Report
Hermosa Beach Economic and
Market Study Update
Prepared for:

City of Hermosa Beach
Prepared by:

Economic & Planning Systems, Inc.

EPS# 204026
June 1, 2021
556
Table of Contents

1. INTRODUCTION ......................................................................................................1

2. SUMMARY OF FINDINGS ............................................................................................4

3. COMPETITIVE CONTEXT ............................................................................................8 Socio-Economic Trends ............................................................................................ 8 Employment Trends .............................................................................................. 13

4. RETAIL TRENDS ................................................................................................... 15

5. HOTEL TRENDS.................................................................................................... 18

6. OFFICE TRENDS ................................................................................................... 22

7. DOWNTOWN HERMOSA BEACH ISSUES AND OPPORTUNITIES ............................................... 25 Area Description ................................................................................................... 25 Issues ................................................................................................................. 27 Opportunities ....................................................................................................... 28 Conclusions.......................................................................................................... 30 APPENDIX A: Business Community Input
APPENDIX B: Key Findings from 2014 Report
APPENDIX C: Supporting Market Data
557
List of Tables
Table 1 Beach Cities Demographic Comparison ............................................................. 11 Table 2 Beach Cities Residential Mix............................................................................ 12 Table 3 Jobs by Industry, 2011-2018 .......................................................................... 14 Table 4 Daytime Population, 2018 .............................................................................. 14 Table 5 Beach Cities Shopping Destinations.................................................................. 15 Table 6 Beach Cities Retail Rents, Vacancies, Inventory ................................................. 16 Table 7 Beach Cities 2018 Taxable Sales Per Capita....................................................... 17 Table 8 Beach Cities Hotel Inventory: Existing and Pipeline ............................................ 20 Table 9 Beach Cities Class B and C Office Inventory ...................................................... 23 Table 10 Hermosa Beach Sales Tax Revenue, FY 2019-20................................................ 26 Table 11 Downtown District by Land Use ....................................................................... 31 Table 12 Downtown Hermosa Beach by Ownership Pattern............................................... 33 Table 13 Downtown Hermosa Beach by Acquisition and Construction Activity...................... 35 558
List of Figures
Figure 1 Beach Cities Map........................................................................................... 11 Figure 2 Beach Cities Historical Retail Rents .................................................................. 17 Figure 3 Beach Cities Retail Vacancies .......................................................................... 18 Figure 4 Beach Cities Historical Class B and C Office Rents .............................................. 22 Figure 5 Beach Cities Historical Class B and C Office Vacancy........................................... 22 Figure 6 Downtown Hermosa Beach by Land Use ........................................................... 30 559
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1. INTRODUCTION
Economic & Planning Systems (EPS) was retained by the City of Hermosa Beach (City) to update its previous Downtown Core Revitalization Strategy: Market and Economic Analysis Report dated January 15, 2014. This updated report is intended to inform the City’s efforts in formulate a citywide economic development strategy. In addition to updating the data included in the last report, the update expands the analysis to incorporate the City as a whole. Economic and market data available through third party sources have been updated to reflect the most current information, and the updated data are incorporated in the tables and text of the full report.

Some aspects of the prior report were based on onsite research and observations. These elements have not been updated, due to the limitations of the Covid-19 pandemic in terms of observing business operations and mix with so many businesses closed or operating at a reduced level.

For the most part, the recommendations of the last study are still valid, and useful as guides to economic development strategies. However, some conditions have changed since the original report was completed, and we have attempted to reflect these in the findings of the update. The most significant changes have to do with parking requirements and strategies; the trend toward working at home, which is likely to continue post COVID-19 and represents an opportunity the City can build upon; the evolution of the business mix and the reduction of externalities from bars on Pier Plaza; and the steps the City has taken to be more proactive in economic development and improving the business climate. EPS explored the ramifications of these changes through interviews with key stakeholders in the community, and have reflected what we have learned in the summary observations described in this executive summary.

Hermosa Beach still occupies a unique position within the triad of Beach Cities located in the South Bay area of the Los Angeles basin. Situated between the highly affluent Manhattan Beach to the north and the larger more urban Redondo Beach to the south, Hermosa is the smallest of the three cities. While also quite affluent, Hermosa Beach has a younger population, a greater proportion of renters, a smaller proportion of family households, and the smallest employment base. The City is known in particular for its laid-back beach lifestyle and nightlife entertainment offerings.

All three Beach Cities began as recreation and vacation destinations characterized by modest housing and commercial services catering primarily to vacationers, day visitors, and the small local population. As Los Angeles grew, the Beach Cities became very desirable places to live year-round, with clean air, excellent schools, the beach amenity, and an improving housing stock. Manhattan Beach in particular, with its superior proximity and transportation linkages to Los Angeles employment centers and LAX, has become very upscale with high home values and a very successful retail and commercial district. Hermosa Beach has benefited from similar trends, and as the city has matured, the Downtown District has evolved as well. Compared with Manhattan Beach, however, Hermosa Beach is in a more transitional stage as downtown commercial offerings offer less diversity in retail and fine dining than would be expected given the city’s demographics and high-quality locational assets.

The findings in this Report are based on currently available data, interviews with industry professionals, site visits, and the authors’ experience with similar projects. Actual future 560
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2. DEMOGRAPHIC AND MARKET DATA UPDATE SUMMARY
P o p u l a t i o n , I n c om e a n d H o u s i n g
• The total Beach Cities population is approximately 121,000, with Redondo Beach the largest at 68,000, followed by Manhattan Beach at 36,000, and Hermosa Beach at 20,000.
• Hermosa Beach’s population grew just 0.7 percent between 2010 and 2019, but its population growth still exceeded its residential unit growth of -2.5 percent. The number of households in the City declined by 4.4 percent over the same period. • In 2020, Hermosa Beach had a median home value of $1.7 million, reflecting a 72 percent increase from 2012. Meanwhile, the median value of a home sold in Manhattan Beach increased to over $2.3 million, reflecting a price growth of 73 percent over the same period. The Redondo Beach median home value of just over $1 million is significantly lower than its Beach City neighbors but still much higher than the City of Los Angeles median of $694,000.
• Hermosa Beach’s median household income in 2019 was $137,000, nearly 40 percent higher than its figure in 2010. Manhattan Beach still possesses the highest median household income of the Beach Cities at $150,000, while Redondo Beach’s has now exceeded six figures, standing at $112,000
• As in 2010, in 2019 Hermosa Beach’s residential population is the youngest, the most transient, and the least family-oriented of the Beach Cities. The median age of Hermosa Beach residents is 39, compared with 44 in Manhattan Beach and 41 in Redondo Beach.

The percentage of owner-occupied households in Hermosa Beach is 42 percent, compared with 62 percent in Manhattan Beach and 48 percent in Redondo Beach. • Single-family homes make up 54 percent in Hermosa Beach. The number of single-family homes in Hermosa Beach has increased since 2010 as the number of multifamily homes has continued to fall. This trend, along with the dramatic increases in home values, reflects the replacement of older multi-family dwellings with larger, more expensive single-family homes, similar to the trend in Manhattan Beach.

Em p l o ym e n t
• Since 2011, job growth outpaced population growth in Hermosa Beach, with the 9 percent increase in jobs representing more than ten times the City’s population growth. • Much of the job growth in Hermosa Beach was in sectors associated with knowledge work. The combined finance, real estate, information, professional services, technical services, and executive management sectors now make up the second-largest segment in Hermosa Beach (19 percent).
• The importance of tourism, dining, and entertainment to the economies of all three Beach Cities is reflected in the job share for the accommodation and food services sectors, which contributed the largest category of Hermosa Beach jobs (24 percent). However, this category saw the largest drop in its share of total jobs since 2011, as knowledgebased jobs have grown at a faster rate. The Covid-19 Pandemic is also expected to have disproportionately impacted hospitality-related jobs.
• Despite the high growth of jobs relative to population in Hermosa Beach, the City maintained a strong bedroom community orientation with a jobs-to-household ratio of

0.71 in 2018. The U.S. Census Longitudinal Employment-Household Dynamic (LEHD) Survey reported that the City had a net commuter outflow of 2,475 that same year. 562
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• There is at least 3.7 million square feet of destination retail within nine miles of Hermosa Beach
• As of Q4 2020, Hermosa had a citywide average annual retail lease rate of $3.54 per square foot, lower than Manhattan Beach ($5.29 per square foot), but above Redondo Beach ($2.98 per square foot). Retail vacancy in Hermosa Beach is the highest among the Beach Cities at 6.1 percent.
• Total taxable sales per capita in Hermosa Beach was $12,202 in 2019, slightly higher than Redondo Beach ($11,258), but significantly lower than Manhattan Beach ($19,192).

While Hermosa performed similar to Manhattan Beach in the Food Services and Drinking Places category, it lagged behind both Manhattan Beach and Redondo Beach in General Merchandise sales.

H o t e l s
• Hermosa Beach has an estimated 480 hotel rooms as of 2021, approximately half the amount in Manhattan Beach and less than one third the amount in Redondo Beach. • The most prominent hotel in downtown Hermosa is the Beach House Hotel, located on the Strand. It serves mainly leisure, business, and group travel, rather than a vacation destination clientele. It has continued to operate during the Covid-19 pandemic, but at lower occupancies. Early check-in and late check-out have allowed some rooms to be occupied by those who want to work outside the home, but in the community. • The H2O is a new 30-room hotel on Hermosa Avenue that opened in Late 2020.

O f f i c e
• Hermosa Beach’s office inventory stands at approximately 367,000 square feet, and remains small compared to Manhattan Beach and Redondo Beach, which have about 1.6 million and 2.4 million square feet of office space, respectively. According to CoStar, all of Hermosa Beach’s office inventory is classified as Class B or C space. • Overall, the Hermosa Beach market for Class B and C office space occupies a viable segment priced below Manhattan Beach but above Redondo Beach. As of the fourth quarter of 2020, Class B and C rents in Hermosa Beach average $3.75 per square foot and are trending up, compared with $3.17 per square foot in Redondo Beach and $4.25 per square foot in Manhattan Beach.
• Hermosa Beach office vacancy rate in Q4 2020 of 11.7 percent is nearly double that of Redondo Beach (5.7 percent) and triple that of Manhattan Beach (3.9 percent). • Marlin Equities expanded its office presence in its buildings along Pier Avenue and it is further expanding its presence in its building at the intersection of Pier and Manhattan Avenues. Baker/Burton Lundy has also expanded and upgraded its office presence on Upper Pier Avenue.
• A remodeled office building on upper Pier Avenue (200 Pier) was originally intended to offer for-sale office condominiums. It has turned out to be leased space and houses numerous small businesses.
• There are a few co-working office spaces in Hermosa, including Unita on Hermosa Avenue. There are quite a few more in Manhattan Beach, and there is potential to 563
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3. KEY TRENDS: ISSUES AND OPPORTUNITIES
P a r k i n g
• Many interviewees noted that restrictive parking requirements in Hermosa Beach often prove to be a major barrier to economic growth, smart urban design, and maintaining the vitality of the historic downtown area. Relaxing the City’s parking standards in some cases would allow otherwise infeasible projects to be realized, facilitate rehabilitation and re-tenanting of historic buildings, and remove barriers to potential businesses wishing to locate in Downtown Hermosa.
• Restaurants in particular are less concerned about parking due to the growth in alternative transportation options, including ride sharing, carpooling, bicycling, and walking from nearby neighborhoods that have reduced car travel and the demand for customer parking.
• Employee parking takes up a lot of capacity that could serve patrons and visitors. Off-site employee parking could free up more customer parking and provide more parking for beach goers and visitors in the summer months.
• One of many suggestions for more strategically locating public parking is converting the tennis courts at the Community Center to structured parking. The City’s in lieu parking fee could be used to help finance parking in the Civic Center/Community Center area instead of on Lot A, north of 11th Street between Hermosa Avenue and Beach Drive.

Several interviewees stated that Lot A would be better used for mixed-use development and/or civic uses in light of its proximity to the Strand and frontage on Hermosa Avenue. • Parking uphill from the downtown commercial district would facilitate foot traffic passing by businesses. This juxtaposition has contributed to the vitality of the retail district in Manhattan Beach.
• It is generally agreed that restrictive parking requirements likely contributed to making the “Pier/Strand” hotel proposed on the Mermaid site financially infeasible. On-site parking requirements were also often cited as a major impediment to the rehabilitation and re-tenanting of older buildings that were built without off-street parking. • Alternative parking and TDM (Transportation Demand Management) strategies could alleviate the financial burden of on-site parking. TDM measures may include valet parking, shuttles, off-site employee parking, and the encouragement of bicycle and pedestrian access, for example.
• Some business owners commented that fewer parking spaces can be beneficial to their bottom line, as it sometimes translates to lower lease rates. • Interviewees were mixed in their assessment of the existing garage. While some noted that it removed demand for street and surface lot parking in the Downtown, and praised the public art component, others noted that it remains largely empty during off-peak periods and occupies a valuable piece of real estate adjacent to the Strand.

B u s i n e s s a n d L a n d U s e M i x
• As a means of identifying the appropriate tenanting strategy for Downtown, multiple interviewees suggested an organized means of obtaining residents’ input on their desired category of establishments.
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Economic & Planning Systems, Inc. 7 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx • It was overwhelmingly agreed that the public safety concerns associated with the latenight bar scene have subsided significantly in the past decade, though the problem remains to some degree, particularly late at night.
• While many hope for a continued trend away from Hermosa’s image as a nightlife destination, a few interviewees noted that some restaurants/bars depend on the post dining hours drinking to make sufficient revenue to cover their costs. • Among those hoping for a continued shift, a culinary-driven scene appears to be desired by many as a means of replicating the success of Downtown Manhattan Beach, and attracting a crowd that is less likely to cause police and EMT calls in the late hours. • One resounding point of unison among interviewees is that outdoor dining which has increased as restaurants struggle to survive during the pandemic should be retained permanently and encouraged moving forward.
• While Hermosa Beach has historically not been a strong location for Class A office space, it is in a unique position to capitalize on certain office trends given its demographic characteristics and quality of life. It was noted that the desirable environment, ample food and business services, and the trend toward business decision-makers wanting to work closer to home are supportive of the demand for Class A office space. • The likely ongoing trend of increased work from home could be augmented by coworking office space that offers an alternative to the home office some of the time. • The PCH corridor offers a general business location in an accessible South Bay coastal community, and has attracted larger users recently, including the national headquarters of the shoe company, Skechers, and Lazy Acres Natural Market. Aviation Boulevard also has potential for market-driven revitalization.
• Many businesses are shut down or operating at reduced levels due to the restrictions of the Covid-19 pandemic. However, it appears that a number of apparently closed restaurants and entertainment venues are remodeling and planning to reopen with new offerings post COVID-19.
• The Comedy and Magic Club is an iconic destination in Hermosa Beach and a valuable asset for the downtown. It is recommended that the City work to retain this unique entertainment asset.
• The Lighthouse at Pier Plaza has recently changed ownership with plans to continue as a live jazz club. Saint Rocke on PCH has also recently changed ownership with plans to return with live music. These small venues for live music or other entertainment are a benefit for the City and offer alternatives to venues that are more focused on alcohol sales.
• Other than older residential uses on the second floor of some buildings, residential uses are largely absent from the downtown core. The development of mixed-use residential on infill sites downtown would add “rooftops” to support downtown restaurant and retail businesses, and activate the streets in the downtown core, as well as provide incentives for new investment and more ground floor commercial space.

W o r k F r om H om e
• Beach cities in the LA metro area are very desirable locations due to the clean air, access to the beach as an amenity, and the charm of historic downtowns that have become increasingly vital. This is likely to increase the value and attraction of these areas for residents, but also as business locations as entrepreneurs and executives seek to reduce commuting on congested roads and highways.
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Economic & Planning Systems, Inc. 8 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx • More people are working from home as a result of the Covid-19 pandemic. As people have found that work from home is a viable option for many, this trend is likely to continue after the pandemic is over.
• Work from home increases the market support for local businesses and restaurants and should be encouraged by the City.
• Allowing and encouraging small scale coworking spaces, perhaps in mixed-use buildings could support work from home for those who need to be in an office part of the time, or prefer to have an option to work outside the home part of the time for other reasons. • Small scale vertical mixed-use buildings with ground floor commercial and shared coworking office space above could be accommodated on small, infill sites downtown.

Parking requirements could be reduced since many users would walk or bike to those locations from their homes.
• There is at least one coworking space in Hermosa, Unita, on Hermosa Avenue.

Manhattan Beach has a number of them, and it is likely more could be supported in Hermosa as an adjunct to the work at home trend.
• Multiple interviewees noted the potential benefits of converting second floor office along Upper Pier into live-work lofts. They anticipate that this will both ease some pressure on the residential market and add to the vitality of the Upper Pier commercial district, which has traditionally seen less foot traffic than the area surrounding Pier Plaza.

C i t y P o l i c y a n d R o l e o f C i v i c O r g a n i z a t i o n s • Multiple interviewees noted that, in the past, Hermosa Beach’s was not seen as a business-friendly city. Most clarified that this was no longer so, but that certain actions could be taken to further enhance the City’s image as it interacts with existing and potential businesses.
• A common theme was Hermosa’s use of conditional use permits (CUPs). Many understood that this tool was necessary to curb negative externalities of the City’s bar scene in the 2000s, but felt that conditions were often over-prescriptive, complicated the transfer of ownership for certain businesses, and that the application process to amend CUPs can be extremely cumbersome.
• Some interviewees expressed that the City does not have a comprehensive commercial strategy. However, they were heartened to hear that the city has appointed a Business Liaison and created and Economic Development Committee and a stakeholder’s group to address the business climate in the city.
• Those familiar with the Chamber of Commerce feel that the entity has a strong potential role, but has historically has not been as effective as it could be in providing guidance and advocacy for the City’s business community. Recent changes in leadership, as well as a surge in new Chamber members may reinvigorate the Chamber and make it more effective.
• Another issue mentioned during the interviews was the perception that the City has focused on Downtown Hermosa at the expense of other commercial nodes within the City. However, recent policy changes have assisted the Cypress district in the southern part of the City, and the City is looking at the PCH corridor and Aviation Boulevard, as places for larger businesses and employers, and considering how the City can help nurture reinvestment and renewal in the corridor business areas. • The City has recently made code amendments to reduce costs for new businesses, including adding a Minor Sign Review and added a Minor Conditional Use Permit process. 567
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4. COMPETITIVE CONTEXT
S o c i o-E c o n om i c T r e n d s
Hermosa Beach is one of three Beach Cities in the South Bay area of Los Angeles County. The northern-most Beach City, Manhattan Beach, is located south of El Segundo, followed by Hermosa Beach and Redondo Beach at the southern end. A sandy coastal strip forms the western boundary of Manhattan Beach, Hermosa Beach, and a portion of Redondo Beach, which also has a significant inland portion. See Figure 1 for a map of the three Beach Cities.

Each of the three Beach Cities has benefited directly from the beach location to become a highly desired place to live, work, and play. With strong access afforded by the 105 and 405 Freeways and the nearby Los Angeles International Airport, the Beach Cities have developed a strong foundation of residential neighborhoods, employment nodes, and visitor attractions to become among the most affluent communities in the County.

And while the Beach Cities show distinctive economic and demographic characteristics, they are geographically conjoined so as to function as a closely inter-related market. The distance from the Sepulveda Shopping Center in northern Manhattan Beach to Riviera Village in South Redondo Beach is five-and-half miles along Pacific Coast Highway. Alternately, the walk or bike ride from northern Manhattan Beach to the King Harbor Marina in Redondo Beach is less than four miles along the beachfront Strand. The Hermosa Valley Greenbelt, a former rail corridor turned hiking and running trail that connects Manhattan Beach to King Harbor, is one of many alternative transportation and trails in the area. For Hermosa Beach, this high degree of interconnection has positive implications for future economic development.

Of the three Beach Cities, Manhattan Beach has the strongest demographic and economic profile, due to the City’s relatively superior location. As the northern-most Beach City, Manhattan Beach is the closest to the West Side job centers in Santa Monica and Century City and to major transportation infrastructure. In addition, Manhattan Beach’s top-rated school system is an attractive draw to young families, though Manhattan Beach’s Mira Costa High School also serves Hermosa Beach. Just south of Manhattan Beach, Hermosa Beach benefits—to a slightly lesser degree—from the same geographical advantages and top-rated school system. Further south, Redondo Beach exhibits a hybrid nature, as South Redondo reflects the characteristics of a pricy beachfront community while North Redondo more closely resembles neighboring inland cities such as Torrance and Hawthorne.

As shown in Table 1, the total Beach Cities population is approximately 121,000, with Redondo Beach the largest at 68,000, followed by Manhattan Beach at 36,000 and Hermosa Beach at 20,000. Contrary to the previous decade, population in all three Beach Cities grew at a slower pace between 2010 and 2019 than the City of Los Angeles (which is used here as a baseline reference). While residential demand has slowed in recent years, the Beach Cities feature high population densities and are largely built out, which has impeded the construction of new housing units and kept pressure on the housing supply. For example, in Hermosa Beach population growth was just 0.7 percent, but it still exceeded its residential unit growth of -2.5 percent. Similarly, while Redondo Beach’s population growth was a modest 1.4 percent, it too 568
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A continuing trend among all the Beach Cities, particularly in Manhattan Beach and Hermosa Beach, is the upward spiral of median home values as a result of the constrained residential supply and high demand for beach community living. In 2020, Hermosa Beach had a median home value of $1.7 million, reflecting a 82 percent increase from 2012. Meanwhile, the median value of a home sold in Manhattan Beach increased to over $2.3 million, reflecting a price growth of 73 percent over the same period. The Redondo Beach median home value of just over $1 million is significantly lower than its Beach City neighbors but still much higher than the City of Los Angeles median of $694,000.

However, the Beach Cities have seen continued growth in household incomes as well. Hermosa Beach’s median household income in 2019 was $137,000, nearly 40 percent higher than its figure in 2010. Manhattan Beach still possesses the highest median household income of the three at $150,000, while Redondo Beach’s has now exceeded six figures, standing at $112,000.

All Beach Cities median household incomes significantly exceed the $58,000 median for Los Angeles. Levels of educational attainment in the Beach Cities have remained high as well, with over 34 percent of Manhattan Beach residents, 26 percent of Hermosa Beach residents, and 23 percent of Redondo Beach residents have graduate-level degrees, compared with 12 percent of Los Angeles residents.

While each Beach City retains a unique demographic profile, they have all seen similar trends in areas such as median age and families as a percentage of total households. As in 2010, in 2019 Hermosa Beach’s residential population is the youngest, the most transient, and the least familyoriented of the three. The median age of Hermosa Beach residents is 39, compared with 44 in Manhattan Beach and 41 in Redondo Beach. The percentage of owner-occupied households in Hermosa Beach is 42 percent, compared with 62 percent in Manhattan Beach and 48 percent in Redondo Beach. Family households in Hermosa Beach make up 46 percent of all households (up from 41 percent in 2010) as compared to 71 percent in Manhattan Beach (from 64 percent in 2010), 61 percent in Redondo Beach (from 56 percent in 2010), and 60 percent in Los Angeles (down from 61 percent in 2010).

Despite distinctions between the residential communities of each of the Beach Cities, the variances appear to be narrowing as high housing costs in Manhattan Beach cause residential demand to spill over into Hermosa Beach. Some illustration of the underlying residential dynamics can be found in Table 2, showing residential mix in each of the Beach Cities. Singlefamily homes make up 81 percent of the housing stock in Manhattan Beach, compared with 54 percent in Hermosa Beach, 55 percent in Redondo Beach, and 44 percent in Los Angeles. Since 2010, the number of single-family homes in Hermosa Beach increased as the number of multifamily homes has continued to fall: 206 new single-family homes were constructed while 459 multifamily units were eliminated. Based on anecdotal information, this was due to construction of large single-family homes on lots formerly occupied by older multifamily stock. In this environment of escalating land values, Manhattan Beach has become increasingly unaffordable, leaving Hermosa Beach as the next-best option for aspiring Beach Cities residents. 569
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Source: ESRI
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Table 1 Beach Cities Demographic Comparison
Hermosa Beach Manhattan Beach Redondo Beach City of Los Angeles 2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
General
Total Population 19,506 19,650 0.7% 35,135 35,573 1.2% 66,748 67,700 1.4% 3,792,621 3,959,657 4.4% Total Households 9,389 8,979 -4.4% 13,732 13,520 -1.5% 28,540 27,621 -3.2% 1,312,002 1,373,864 4.7% Total Housing Units 10,311 10,049 -2.5% 15,128 15,363 1.6% 30,243 29,979 -0.9% 1,415,592 1,474,043 4.1% Median Household Income $99,976 $137,188 37.2% $131,723 $150,083 13.9% $91,737 $112,271 22.4% $48,746 $58,385 19.8% Median Home Value (1) $957,000 $1,740,000 81.8% $1,379,000 $2,392,635 73.5% $640,000 $1,073,000 67.7% $374,200 $694,583 85.6% Median Rent $1,795 $2,181 21.5% $1,995 $2,628 31.7% $1,575 $2,072 31.6% $1,104 $1,450 31.3% Average Household Size 2.04 2.19 7.4% 2.50 2.63 5.2% 2.29 2.45 7.0% 2.81 2.82 0.4% Average Family Size 2.80 2.87 2.5% 3.10 3.14 1.3% 2.94 3.07 4.4% 3.53 3.62 2.5% Family/Total Households (%) 41% 46% 64% 71% 56% 61% 61% 60% Owner-Occupied/Total Units (%)(2) 42% 42% 64% 62% 49% 48% 36% 34% Labor Force Participation (%) 80% 77% 68% 64% 75% 72% 67% 66% In-City Jobs/Household 0.62 0.67 1.25 1.30 0.82 0.86 1.22 1.19 Age
Median Age 37.0 39.3 6.2% 40.9 44 7.6% 39.3 40.7 3.6% 34.1 35.6 4.4% Age 18+ (% of total) 84% 82% 75% 73% 81% 78% 77% 79%
Age 65+ (% of total) 9% 12% 13% 17% 10% 13% 10% 12%
Household Income
< $15,000 5% 5% 4% 3% 7% 5% 15% 13%
$15,000 - $49,999 18% 11% 12% 12% 19% 15% 36% 31%
$50,000 - $99,999 27% 22% 21% 20% 28% 25% 27% 27%
$100,000 - $149,999 21% 17% 18% 15% 21% 20% 11% 14%
$150,000+ 29% 46% 45% 50% 26% 35% 11% 16%
Education (Age 25+)
No High School Diploma 2% 2% 1% 2% 4% 4% 26% 23%
High School Graduate 6% 6% 7% 7% 13% 11% 19% 19%
Some College, No Degree 17% 11% 13% 11% 19% 19% 18% 18% Associate Degree 6% 5% 5% 5% 7% 8% 6% 6%
Bachelor's Degree 44% 49% 42% 40% 37% 36% 20% 22%
Master's/Professional/Phd. 25% 26% 32% 34% 20% 23% 10% 12% (2) Includes units for sale
(1) Median home values for 2012 and 2020
Sources: US Census American Community Survey 5-year Estimate 2015-2019; Economics & Planning Systems 571
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Table 2 Beach Cities Residential Mix
Hermosa Beach Manhattan Beach Redondo Beach City of Los Angeles 2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
2010 2019 '10-'19
Change
Residential Mix
Total 10,311 10,058 (253) 15,128 15,020 (108) 30,243 30,024 (219) 1,415,592 1,493,108 77,516 Single-Family
1, Detached 43% 43% (74) 69% 72% 322 40% 41% 313 39% 38% 15,540 1, Attached 8% 11% 280 8% 9% 150 14% 14% 75 6% 6% (948) Multi-Family
2 13% 12% (155) 10% 7% (379) 4% 2% (435) 3% 3% 2,925
3 or 4 11% 7% (369) 7% 5% (232) 11% 11% (159) 6% 6% 3,927 5 to 9 7% 10% 300 2% 2% (14) 7% 8% 393 9% 9% 7,421
10 to 19 6% 3% (313) 2% 2% 15 7% 7% (7) 10% 10% 1,338
20+ 11% 12% 59 2% 2% (49) 17% 16% (327) 27% 28% 46,175
Mobile Home 2% 1% (67) 0% 1% 79 0% 1% 44 1% 1% 917
Other 0% 1% 86 0% 0% 0 0% 0% (116) 0% 0% 221
Owner-Occupied Units by Value
< $50,000 1% 2% 1% 2% 1% 1% 2% 1%
$50,000 - $499,999 7% 5% 4% 2% 9% 5% 49% 32%
$500,000 + 92% 93% 95% 96% 90% 95% 49% 67%
Residential Unit Age
Built since 1980 22% 29% 30% 36% 31% 34% 21% 25%
Built 1940 to 1979 61% 59% 62% 57% 63% 62% 59% 55%
Built 1939 or earlier 16% 12% 8% 7% 6% 4% 21% 20%
(1) Median home values for 2019, and net growth from 2010 to 2019 Sources: American Community Survey 5-Year Estimates 2019; Economics & Planning Systems 572
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Historically, the Beach Cities served primarily as a vacation destination before evolving into permanent small-town communities. The Southern California aerospace industry was largely based in and near the South Bay and provided a source of high-paying jobs until the end of the Cold War, when sudden cancellation of government contracts and research initiatives helped caused an exodus of aerospace firms and resulted in recession. (However, Northrop Grumman remains the largest employer in Redondo Beach, and a cluster of aerospace firms maintain a strong presence in El Segundo to the north.) More recently, the Beach Cities have benefited from the growth of high-income knowledge workers seeking work environments that are closer to home and that offer a high quality of life.

Table 3 shows that, since 2011, job growth outpaced population growth in Hermosa Beach and Manhattan Beach: the 9 percent job growth in Hermosa Beach was more than ten times population growth, while 5 percent job growth in Manhattan Beach nearly quadrupled population growth. (Redondo Beach, with a large industrial sector, experienced continued job losses in keeping with larger structural declines in manufacturing.) Much of the job growth in Hermosa Beach and Manhattan Beach was in sectors associated with knowledge work. The combined finance, real estate, information, professional services, technical services, and executive management sectors make up the largest segment of Manhattan Beach employment (31 percent), and the second-largest segment in Hermosa Beach (19 percent). Since 2011, such knowledge workers represented the largest net gain of jobs in Manhattan Beach. The importance of tourism, dining, and entertainment to the economies of all three Beach Cities is reflected in the job share for the accommodation and food services sectors, which contributed the largest category of Hermosa Beach jobs (24 percent) the second-largest for Manhattan Beach (21 percent), and the third-largest for Redondo Beach (16 percent). However, in Hermosa Beach, this sector experienced the largest drop in employment since 2011.

Each of the Beach Cities has seen an increase in jobs per household as well as its daytime population since 2011. However, despite the high growth of jobs relative to population in Hermosa Beach, the City maintains a strong bedroom community orientation with a jobs-tohousehold ratio of 0.71 in 2018. This means that for every Hermosa Beach household, there were 0.71 jobs in the City. A normalized ratio, as reflected by the City of Los Angeles, is 1.16. A low jobs-to-household ratio typically means a daily net outflow of workers and a decline in the day population. As shown in Table 4, the population of Hermosa Beach falls 1,950 per day, or 10 percent. Redondo Beach, like Hermosa Beach, is also primarily a bedroom community and loses 10 percent of its population to out commuting daily. Manhattan Beach, by comparison, has a jobs-to-household ratio of 1.25, which results in a day population net inflow of 4,950, equivalent to a 14 percent expansion of the residential population. However, Hermosa Beach is expected to benefit from the work from home trend, which keeps more residents and increases the daytime customer base for Hermosa Beach businesses.

A large day population in an urban area often results in additional retail demand. Several retailers interviewed in Manhattan Beach and Hermosa Beach indicated that the difference in day population was a major reason why Hermosa Beach could not compete as effectively for retail tenants and restaurants.
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Table 4 Daytime Population, 2018
Hermosa Beach Manhattan Beach
2018 '11-'18
Change
Share 2018 '11-'18
Change
Share 2011 '11-'18
Change
Share Share
All Jobs 6,409 547 100% 17,579 160 100% 25,851 (2,202) 100% 100% 9% 1% -9%
Accommodation and Food Services 1,535 (266) 24% 3,335 (513) 19% 3,155 817 17% 9% FIRE (2), Infmtn, Prof./Tech., Exec.Mgmt. 1,236 210 19% 5,443 684 31% 3,602 76 16% 21% Retail Trade 899 52 14% 2,781 (314) 16% 3,090 (98) 13% 8% Health Care and Social Assistance 684 290 11% 1,889 558 11% 1,079 593 7% 16% Admin. & Support, Waste Mgmt./Remed. 492 128 6% 874 335 5% 734 (19) 3% 4% Other Services (excluding Public Admin.) 370 (20) 8% 930 (446) 5% 900 (110) 3% 6% Production (1) 325 169 2% 307 (107) 3% 990 236 1% 7%
Wholesale Trade, Transport, Warehousing 294 88 4% 385 35 6% 8,300 (1,908) 6% 9% Educational Services 249 33 5% 1,009 65 2% 1,242 146 27% 14% Arts, Entertainment, and Recreation 171 (118) 5% 178 (107) 2% 485 72 5% 4% Public Administration 154 (19) 3% 448 (30) 1% 386 (119) 2% 3% (1) Production includes Agriculture, Forestry, Fishing, Hunting, Resource Extraction, Utilities, and Construction (2) FIRE includes Finance, Insurance, and Real Estate
Source: LEHD Census, Economic & Planning Systems, Inc.

Redondo Beach L.A. Hermosa
Beach
Manhattan
Beach
Redondo
Beach
Day Population (2018)
Residential Population 19,650 35,573 67,700
Live in City, Employed Outside City (8,042) (12,101) (27,841) Employed in City, Living Outside City 5,567 16,478 21,371 Day Population 17,175 39,950 61,230
Daily Inflow/(Outflow) (2,475) 4,377 (6,470)
Daily Inflow/(Outflow) as % of Residential Population -13% 12% -10% Population Density/Square Mile
Population 13,800 9,000 10,900
Day Population 12,000 10,100 9,900
Sources: US Census, Census LEHD, ESRI, Economic & Planning Systems Inc. 574
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5. RETAIL TRENDS
The retail competitive landscape for Hermosa Beach, which includes all of the Beach Cities and parts of El Segundo and Torrance, offers a wide variety of shopping options, including large enclosed malls, open-air lifestyle centers, and downtown street retail. As shown in Table 5, there is at least 3.65 million square feet of destination retail within a 10-mile radius of Hermosa Beach.

Table 5 Beach Cities Shopping Destinations
However, the most direct retail competition for Hermosa Beach is walkable retail districts in downtown Manhattan Beach and Riviera Village in Redondo Beach. As shown in Table 6, downtown retail commands the highest rents and lowest vacancies in each of these cities. Rents in the Hermosa Beach downtown are roughly equal to the city-wide. Conversely, Manhattan Beach downtown rents exceed city-wide rents by 30 percent, from $5.29 to $6.89, and Riviera Village rents surpass the Redondo Beach average by 65 percent, from $2.98 to $4.91. In all three cases, downtown vacancies are higher than the citywide average, from 7.5 percent in Hermosa Beach to 4.0 percent in Manhattan Beach to 5.5 percent in Riviera Village. These high vacancies can likely be attributed to the Covid-19 pandemic, as they increased markedly since the beginning of 2020. The generally strong performance of downtown Manhattan Beach and Redondo Beach, as well as other walkable retail districts has encouraged pipeline projects such as the Redondo Beach Pier redevelopment and the Point lifestyle center in El Segundo, both of which have been designed to provide streetscape character.

From a competitive perspective, as indicated by Figure 2 and Figure 3, rents and vacancy rates in Manhattan Beach have consistently out-performed those in Hermosa Beach and Redondo Beach. According to brokers and local business people, this is due primarily to the more affluent demographic profile of Manhattan Beach residents, who can support higher-end retailers than neighboring cities, and to Manhattan Beach’s vibrant daytime population. Another factor may be the relative lack of retail diversity in Hermosa Beach. On a total sales-per-capita basis, as shown in Table 7, Hermosa Beach is well exceeded by Manhattan Beach, and slightly higher than Redondo Beach. While Hermosa Beach performs strongly in food and beverage stores, restaurants and bars, it appears to have retail leakage in categories including apparel, general merchandise, and large-format retail segments like garden supplies, home furnishings, auto parts, and general wholesale items. Of these leakage categories, the street retail character and small floor plates in Downtown Hermosa Beach are best suited to supporting an expansion in the apparel (including women’s fashion goods, general apparel for younger consumers, and sports Shopping Center Type of Center Miles from
Hermosa
Beach
Retail
Sq.Ft.

Key Tenants Address
South Bay Galleria Enclosed Mall 3.5 955,000 Macy's; Nordstrom; Kohls 1815 Hawthorne Blvd.; Redondo Beach, CA, 90278 Manhattan Village Shopping Center Enclosed Mall 3.4 572,837 Macy's; Williams-Sonoma; Coach 3200 Sepulveda blvd.; Manhattan Beach, CA 90266 Riviera Village Downtown Street Retail 3.4 413,000 Local boutiques and services Plaza El Segundo Open-Air Lifestyle/Big Box 3.8 400,000 Whole Foods; Anthropologie; H&M; Lululemon760 South Sepulveda Blvd; El Segundo, CA 90245 Redondo Beach Pier Downtown Street Retail 1.5 400,000 Shade Hotel, Theater Promenade on the Peninsula Open-Air Lifestyle Center 9.0 374,000 Williams-Sonoma; Banana Republic; Gap 550 Deep Valley Drive; Rolling Hills Estates, CA 90274 Downtown Manhattan Beach Downtown Street Retail 2.1 231,000 True Religion, Shade Hotel, boutiques the Point Open-Air Lifestyle Center 3.8 115,000 Mendocino Farms, True Food Kitchen 850 South Sepulveda, El Segundo Redondo Shores Open-Air Lifestyle/Big Box 1.5 102,000 Whole Foods; Rite Aid; GNC 403-419 N Pacific Coast Hwy Fisherman's Wharf Downtown Street Retail 1.5 90,000 Local restaurants and souvenir shops 415 Diamond Street; Redondo, CA 90277 3,652,837
Source: L.A. County Assessor; CoStar; Economic & Planning Systems, Inc. 575
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Ultimately, successful improvement in the retail mix will depend on a broad range of factors discussed further in Section 7.

Table 6 Beach Cities Retail Rents, Vacancies, Inventory Figure 2 Beach Cities Historical Retail Rents
As of 4Q 2020 All Retail Downtown Retail1 All Retail Downtown Retail2 All Retail Downtown Retail3 Rents (/Sq.Ft.) $3.54 $3.53 $5.29 $6.87 $2.98 $4.91
Vacancy 6.1% 7.5% 1.8% 4.0% 4.1% 5.5%
Inventory (Sq Ft.) 1,032,661 263,336 1,893,104 267,684 3,799,996 325,159 (3) "Downtown" includes Riviera Village in Redondo Beach Source: CoStar; Economic and Planning Systems, Inc.

Hermosa Beach Manhattan Beach Redondo Beach
(1) "Downtown" includes Pier Avenue, Pier Plaza, and Hermosa Ave. between 9th and 15th Streets in Hermosa Beach (2) "Downtown" includes the rectangle formed by the Strand, 10th, 13th, and Valley Blvd. in Manhattan Beach $3.54
$2.98
$5.29
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
Hermosa Beach Redondo Beach Manhattan Beach
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Table 7 Beach Cities 2019 Taxable Sales Per Capita

6.1%

1.8%

4.1%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%
Hermosa Beach Manhattan Beach Redondo Beach
Hermosa
Beach
Manhattan
Beach
Redondo
Beach
City of Los
Angeles
Population (1) 19,650 35,573 67,700 3,959,657
Total Taxable Sales (2) $263,669,054 $809,970,962 $902,091,369 $50,174,450,540 Taxable Sales Per Capita
Motor Vehicle and Parts Dealers $723 $2,326 $819 $1,243 Home Furnishings and Appliance Stores $696 $802 $747 $475 Building Material and Garden Equipment - - $113 $665
Food and Beverage Stores $1,539 $1,816 $1,393 $758
Gasoline Stations - $1,013 $892 $1,171
Clothing and Clothing Accessories Stores $590 $1,946 $1,392 $857 General Merchandise Stores (3)
- $2,725 $1,311 $735
Food Services and Drinking Places $5,219 $5,715 $3,478 $2,580 Other Retail Group (4) $3,435 $2,847 $1,213 $1,184
Total Taxable Sales Per Capita $12,202 $19,192 $11,358 $9,666 (1) U.S. Census Bureau; American Community Survey; Population, 2019 Source: State of California Board of Equalization (BOE); Economic & Planning Systems, Inc. (2) California State Board of Equalization, 2019
(3) BOE catch-all category; includes florists, office supplies, gift/novelty/souvenirs, used merchanise, and other miscellaneous items
(4) BOE category; includes wholesale taxable sales categories including agriculture, mining, construction, manufacturing, etc.
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6. HOTEL TRENDS
Hermosa Beach has the potential to become a top hotel destination in Los Angeles County.

Despite the attractiveness of the Beach Cities for visitors, there are few luxury hotels in the area.

As shown in Table 8, only the Beach House in Hermosa Beach, the Portofino in Redondo Beach and the Shade in Manhattan Beach are considered upscale or luxury. What’s more, neither the Portofino nor the Shade has beachfront exposure. In all of Los Angeles County, there are very few upscale beach-front hotels. Consequently, the opportunity in Hermosa Beach to develop an upscale beachfront hotel represents an extremely valuable option.

H2O, a 30-room “mid-range” boutique hotel located on Hermosa Beach at 15 th Street, is the
most recent hotel property developed in Hermosa Beach. The Beach House continues to perform well relative to its competitive set, and has room rates of approximately $325-$340 per night.

Owned and operated as a fractional ownership, in which rooms unoccupied by the owners are rented as typical hotel rooms, the Beach House achieved high occupancy levels of near 85-90 percent prior to the pandemic. In the latter half of 2020, it reported occupancy levels of 65 percent, despite the effects of the Covid-19 pandemic. Because ground floor rooms front directly on the Strand, the Beach House has effectively privatized strand/beach frontage for hotel guests.

As shown by Table 8, Manhattan Beach has not seen a new hotel delivery since the Shade Hotel was completed in 2012. Another Shade Hotel was completed in Redondo Beach in 2016, along with a Hilton in 2014 and a Homewood Suites in 2017. These three hotels have added nearly 380 rooms to Redondo Beach’s hotel inventory over the past seven years.

In Hermosa Beach, the envisioned Mermaid site hotel, on the other hand, had the potential to be strongly catalytic. The site on the corner of Pier Plaza and the Strand is arguably the best available commercial land between Redondo Beach and Manhattan Beach. If operated as an upscale or luxury hotel, it could become a landmark beachfront destination, generate significant economic and fiscal impacts, and provide residents and Beach City visitors with an upscale alternative to current Pier Plaza bars and restaurants. This, in turn, could influence tenanting decisions by Pier Plaza and greater downtown property owners and lead to a diversification of current uses.
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Economic & Planning Systems, Inc. 20 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Table 8 Beach Cities Hotel Inventory: Existing and Pipeline Name Year Built Category Rooms
Hermosa Beach
Current
Beach House 1998 Luxury 96
Grandview Inn 1973 Economy 17
H2O Hermosa 2020 Mid-Range 30
Hampton Inn 2002 Economy 70
Holiday Inn Express 2001 Economy 80
Hotel Hermosa 1990 Mid-Range 80
Quality Inn 1986 Economy 68
Sea Sprite Ocean Front Motel 1957 Economy 39
480
Manhattan Beach
Current
Belamar Hotel 1961 Mid-Range 134
Crimson Hotel 1988 Economy 45
Hawthorn Suites 2003 Mid-Range 53
Hi View Inn and Suites 1952 Economy 22
Manhattan Beach Marriott 1986 Mid-Range 373
Manhattan Village Inn & Suites 1986 Economy 18
Residence Inn Manhattan Beach 1985 Mid-Range 176
Sea View Inn 1962 Mid-Range 37
Shade Hotel 2012 Luxury 38
Wave Hotel 1995 Economy 44
940
Redondo Beach
Current
Best Western Plus 1979 Economy 108
Best Western Redondo Galleria 1984 Economy 51
Sonesta [1] 1986 Mid-Range 350
Hilton Garden Inn 2014 Mid-Range 147
Homewood Suites 2017 Mid-Range 184
Marriott Residence Inn 2014 Mid-Range 172
Moonlite Inn 1986 Economy 23
Pacific Coast Inn 1960 Economy 20
Portofino Hotel & Marina 1962 Upscale 161
Ramada Limited Redondo Beach 1990 Economy 40
Redondo Beach Hotel 1979 Mid-Range 112
Redondo Inn and Suites 1955 Economy 36
Redondo Pier Inn 1987 Economy 37
Seaside Motel 1962 Economy 27
Shade Redondo Beach 2016 Luxury 45
1,513
Current Total 2,933
[1] Formerly the Crowne Plaza
Source: CoStar, Hotel Websites & Staff; Economic and Planning Systems, Inc. 579
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7. OFFICE TRENDS
As shown in Table 9, Hermosa Beach’s office inventory stands at approximately 367,000 square feet, and remains small compared to Manhattan Beach and Redondo Beach, which have about

1.6 million and 2.4 million square feet of office space respectively. As of Q4 2020, Hermosa Beach’s office inventory is entirely Class B and C office space, though the construction of Skecher’s global headquarters will deliver about 75,000 square feet of Class A space in 2022.

The City’s office market inventory has grown by 5 percent in the last 10 years, a growth rate higher than both Manhattan Beach and Redondo Beach, both of which saw negligible growth over that same period.

Overall, the Hermosa Beach market for Class B and C office space in Hermosa Beach occupies a viable segment priced below Manhattan Beach but above Redondo Beach. As of the fourth quarter of 2020, as shown in Figure 4, Class B and C rents in Hermosa Beach average $3.75 per square foot and are trending up, compared with $3.17 per square foot in Redondo Beach and $4.25 per square foot in Manhattan Beach.

Historical office vacancies, as shown in Figure 5, indicate considerable volatility in the Hermosa Beach office market, compared with the other Beach Cities. As of the fourth quarter of 2020, the Hermosa Beach office vacancy rate of 11.7 percent is significantly higher than the 3.9 percent rate in Manhattan Beach and the 5.7 percent rate in Redondo Beach.

Table 9 Beach Cities Class B and C Office Inventory
As of 4Q 2020 Hermosa Beach Manhattan Beach Redondo Beach Rents (/Sq.Ft.) $3.75 $4.27 $3.17
Vacancy 11.7% 3.9% 5.7%
Inventory (Sq Ft.) 366,990 984,158 2,053,563
Sources: CoStar; EPS
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Economic & Planning Systems, Inc. 22 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Figure 4 Beach Cities Historical Class B and C Office Rents Figure 5 Beach Cities Historical Class B and C Office Vacancy $3.75
$4.27
$3.17
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
Hermosa Beach Manhattan Beach Redondo Beach

11.7%

3.9%

5.7%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%
Hermosa Beach Manhattan Beach Redondo Beach
Source: CoStar, Economic & Planning Systems, Inc.

Source: CoStar, Economic & Planning Systems, Inc.
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8. HERMOSA BEACH ISSUES AND OPPORTUNITIES
A r e a D e s c r i p t i o n
Hermosa Beach’s Downtown District is the commercial heart of the City. With approximately 18.5 acres of commercially zoned land area, the Downtown District hosts a majority of the City’s boutique retail outlets and a large proportion of its hotel and office uses. As recently as the 1980s, Downtown Hermosa Beach was marked by dilapidated and abandoned buildings, high levels of vagrancy, and recurring public safety issues associated with the area’s rough-andtumble bars. City investments in the 1990s and early 2000’s in public infrastructure, most notably the redesign of Pier Plaza and Upper Pier Avenue, helped transform Downtown Hermosa Beach into a popular daytime and nightlife destination.

The Downtown District centers on the intersection of Pier and Hermosa Avenues and extends along Pier Avenue from the Strand through Pier Plaza to Valley Boulevard and along Hermosa Avenue from 15th Street to 8th Street. The western end of Pier Avenue terminates with Pier Plaza, a large pedestrian-only area that attracts visitors from throughout the County for its access to the Pier, great outdoor dining options, events, and nightlife. Most of Downtown’s busiest restaurants and bars cluster on Pier Plaza and the Pier Avenue/Hermosa Avenue intersection, while the streets north, south, and east host a variety of retail, personal service and food serving business, and some lodging uses. The other significant retail clusters include a number of office uses on Pier Avenue and a concentration of health and beauty uses in upper Pier Avenue.

Several physical characteristics make Downtown Hermosa Beach unique. As Pier Avenue descends to the intersection with Hermosa Avenue, it follows a broad and dramatic sweep, which allows for a pleasing streetscape experience (enhanced greatly by the recently completed Pier Avenue Streetscape Project) that provides numerous focal points for commercial activity. Where Pier Avenue meets Hermosa Avenue, the grade ends, leaving a full flat block between Hermosa Avenue and The Strand, providing Pier Plaza with an unmediated connection to the beach.1 The PCH Corridor is the largest contributor to sales tax revenue in Hermosa Beach, generating nearly $1 million for the City in FY2019-2020, as shown in Table 11, which is nearly half of the City’s sales tax revenue. Downtown Hermosa Beach is also a significant contributor to the City’s fiscal base, generating nearly $648,000 for the City’s General Fund, and accounting for a third of all sales tax revenue collected by the City. However, the Downtown has seen its volume of sales tax revenue drop by over 20 percent from the prior year, the largest amount of any area in the City. This decline is likely attributable largely to the impacts of the covid-19 pandemic.

However, it should be noted that sales taxes represent a relatively small portion of the City’s overall fiscal revenues, amounting to approximately 12 percent of all General Fund revenues in fiscal 2019-20. (See Appendix C for fiscal revenue breakdowns and historical detail.) 1 Other area beachfront commercial districts in LA County, such as in Santa Monica, Malibu, Manhattan Beach, and Redondo Beach, tend to be separated from the beach by steep grades or major roads.
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Economic & Planning Systems, Inc. 24 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Table 10 Hermosa Beach Sales Tax Revenue, FY 2019-2020
I s s u e s
Despite location advantages and fiscal contributions, Downtown Hermosa Beach has not— according to area land use professionals and residents—fulfilled its potential as a commercial district for residents and visitors. Over the course of this analysis, several issues regarding the current pattern of Downtown land uses and tenanting emerged.

A common concern is over Pier Plaza tenants and whether they represent the best fit for City residents. Conflict between late-night Pier Plaza revelers and neighborhood residents led to the Measure B “Quiet Nights” ballot initiative, which aimed to reduce late-night operating hours of Pier Plaza establishments. As shown in Table 11, establishments with CUPs granting late-night operating privileges make up nearly 48,000 square feet of area in the Downtown Core, more than half of all the restaurant and bar space there. While the loss of the initiative implies that residents do not believe a mandated reduction in late-night operating hours is the best way necessarily to manage the issue, many also believe the bar scene on Pier Plaza deters visitation from families and upscale tenants. At minimum, Pier Plaza lacks sufficient alternatives to the current slate of boisterous and young adult-oriented establishments.

As noted in the retail assessment, Hermosa Beach experiences leakage in several retail categories, most notably apparel and general merchandise. This corresponds with anecdotal findings from interviewees about the lack of boutiques and women’s apparel shops of the quality found in Downtown Manhattan Beach. Indeed, as shown in Table 11, apparel occupies just 20,000 square feet or 4 percent of Downtown District commercial space. Interviewees acknowledge that while Manhattan Beach retail tenanting has become very upscale, featuring tenants more typically associated with Beverly Hills and South Coast Plaza, there is a strong and unmet opportunity in Hermosa Beach for retailers to operate at a slightly lower price-point.

Conversely, the health and beauty category2 (which includes services ranging from hair and nail salons to gyms and yoga studios) may be over-represented. With almost 52,000 square feet in the Downtown District making up 9 percent of the total commercial area, health and beauty is the largest single retail category. As shown on Figure 8, health and beauty establishments 2 Health and Beauty in this analysis is considered a retail category subset.

Geographic Area FY19-20 1-Yr Change Share
PCH $938,320 -7% 48.4%
Downtown $648,316 -22% 33.4%
Pier/Valley/Monterey $265,014 -8% 13.7%
Aviation $86,840 1% 4.5%
Source: HDL/City of Hermosa Beach, Economic & Planning Systems, Inc. 583
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Economic & Planning Systems, Inc. 25 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx cluster on upper Pier Avenue and along the eastern side of Hermosa Avenue. Health and beauty uses are typically found in neighborhood retail centers rather than shopping districts, so their concentration may be impeding development of a stronger specialty retail orientation for the Downtown District.

Downtown retail property and leasing management reflects a wide range of sophistication. While the average Downtown rent of $3.53 per square foot, actual rents—according to brokers—vary widely, from below $2 per square foot to above $6. This results in an inconsistent tenant mix with many non-competitive operators. The inconsistencies are attributable to a number of nonresidents, non-professional, long-term custodial land owners who operate their properties without close regard to market rates. As shown on Table 14, private land owners who have owned since before 2003 control 34 percent of the Downtown land area. Furthermore, fragmented land ownership, resulting in a large number of land owners, makes coordinated action difficult. Fully 63 percent of the Downtown land area is held by owners who control less than three parcels, and parcels themselves are small in size.

The Pier Avenue Streetscape project made vast improvements to the livability and walkability of Pier Avenue, but according to interviewees, there are still too few places for pedestrians and shoppers to congregate, sit, and enjoy the surroundings. In general, there is a lack of outdoor seating in the area, and the design of Pier Plaza can feel barren at less crowded times. This detracts from Downtown’s sense of place and ability to attract day-time visitors.

O p p o r t u n i t i e s
Several strategies are available to the City to realize its goal of promoting economic development in Hermosa Beach, as well as commercial districts along PCH and Aviation Boulevard. Most of these are opportunistic in nature, as they ultimately rely on market-driven change led by the private sector.

Land ownership and usage patterns in Downtown Hermosa Beach have undergone a significant amount of transition in recent years. Since 2010, 24 percent of the Downtown land has changed hands, as shown in Table 14. This activity is attributable to several driving factors: the end of the recession; the continued in-migration of wealthy residents to Hermosa Beach and the Beach in general; growth of high-paying jobs to Hermosa Beach and the Beach Cities; and public investment into streetscape improvements on Pier Avenue.

The proposed Pier/Strand Hotel at the Mermaid site hotel represent a great opportunity to catalyze change in Pier Plaza, combining strong underlying market factors with a strategic location. The site is one of the best commercial locations on the entire Strand between Redondo Beach and Manhattan Beach due to its frontage on both Pier Plaza and the Strand. The costly land assembly reflects confidence in the market to support luxury hotel rates. The site dominates the northwestern corner of Pier Plaza, so new construction will strongly influence its look and feel going forward. With very few alternatives for upscale or luxury beachfront hotels in Los Angeles County, the proposed Mermaid site hotel could become—like Shutters and Casa del Mar in Santa Monica and Terranea in Palos Verdes—a landmark destination drawing visitors from all over the country. Inclusion of ground floor public space, such as a lobby bar, could provide an amenity for locals and day visitors as well as guests, providing an upscale alternative to current Pier Plaza bars and restaurants. This, in turn, could influence tenanting decisions by Pier Plaza land owners 584
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Economic & Planning Systems, Inc. 26 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx and lead to a diversification of current uses. Finally, the economic impacts from spending by affluent guests and the fiscal impacts from new Transient Occupancy Tax (TOT) and sales tax could be very significant. City support for a top-quality hotel on the site thus presents a highleverage opportunity to effect positive change. One proactive idea would be for the City to consider leveraging its ownership of the parking lot on 13th Street east of the hotel site to enhance hotel feasibility. Use of the parcel to expand the hotel footprint—rather than for a parking structure—could allow inclusion of more amenities, enhancing its appeal to guests and the community at large. The requirement for on-site, underground parking on this site, likely contributed to the project to be deemed infeasible and shelved. Finding alternatives to on-site parking may allow a similar project to go forward.

Similarly, the City should look to encourage and support other catalytic projects Citywide as they materialize. Likewise, projects on the strategically located eastern corners of Pier Plaza currently occupied by Bank of America and Citibank, could also have a catalytic effect (although retail banks are typically long-term land users).

The compact and walkable nature of Downtown Hermosa Beach lends itself to a district parking strategy that encourages visitors to park centrally and circulate on foot. Consequently, provision of centralized public and public-private parking solutions could increase pedestrian traffic and enhance retail vitality. In addition, the option for developers to provide parking through in-lieu fees, as is already offered by the City, can help some physically constrained sites become more viable for new development. However, the current in-lieu fee which is roughly equivalent to the per-stall development cost in a parking structure, and the requirement for some on-site parking, are considered restrictive by many local land use professionals, especially given high current parking requirements mandated by city code for commercial uses, restaurants in particular. The City can ease the burden on developers by lowering in-lieu fees, by removing requirements for providing a portion of the parking requirements on-site and by lowering parking requirements outright.3 There is strong potential for the City to offset these costs with increases in sales tax, business license tax, TOT, and other taxes associated with new commercial activity.

Streetscape improvements on Hermosa Avenue and enhancements on Pier Plaza could help the area more fully realize the potential of its natural physical advantages to become a more attractive destination for day-time visitors, families, and tourists. Such improvements could enhance the sense of arrival, calm traffic, upgrade the pedestrian experience, facilitate bicycle transport, and refine the overall identity of the area. This could help create a “virtuous circle” that attracts more visitors, who increase the market potential for new tenants, who in turn draw more visitors. For example, focused improvements on the eastern side of Hermosa Avenue that encourage a more vibrant street life can help bring out the redevelopment potential represented by relatively large parcels and floorplates, frontage that defines (and extends) the edge of the Pier Plaza activity, and traffic counts consistent with the location at the nexus of the Downtown 585
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Economic & Planning Systems, Inc. 27 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx District. Furthermore, such improvements can help improve circulation between Upper Pier Avenue and Pier Plaza and facilitate a stronger commercial flow between the two areas.4 In the commercial centers along Aviation Blvd. and PCH, there is also the opportunity to improve the streetscape and pedestrian infrastructure in order to enhance their respective retail environments. It was noted that Aviation Blvd. in particular would benefit from beautification and traffic-calming measures. These commercial centers present especially attractive opportunities for investment, given their location along main arterials. This lends them a higher degree of accessibility to those living inland in Hermosa Beach, as well as residents from surrounding communities. In terms of the potential for additional retail offerings in these areas, the retail leakage statistics discussed in Chapter 5 suggest that establishments offering apparel, general goods, and garden shops have the potential to capture a market that currently shops for these items outside of Hermosa Beach.

As previously discussed, Hermosa Beach is predominantly a bedroom community with a relatively small day population. In this regard, Hermosa is at a competitive disadvantage to Manhattan Beach, which has a much larger day population, especially for higher quality restaurants that depend in part on lunch business. Nonetheless, continued growth of office space for knowledge workers in the Downtown area, whether as part of single- or mixed-use developments, can create a greater workday buzz and stimulate restaurant and retail development directly. Additionally, the trend toward working from home spurred by the Covid19 pandemic is likely to persist, and will improve spending and vitality downtown.

C o n c l u s i o n s
Realization of any of these opportunities could yield economic growth and help positively transition the Downtown Core. However, it will take a combination of actions over time by both public and private sectors before a full retail transformation will take place, coupled with a refreshed perception of the Downtown Core as a great place to visit and hang out by day, by night, and for a broad range of users including tourists, locals, and families.

With regard to business districts elsewhere in the City, Aviation Blvd. and PCH are established as commercial nodes with robust retail environments. PCH in particular generates nearly half the City’s sales tax. However, key stakeholders have noted that both corridors could benefit from visual and infrastructural improvements in order to attract higher numbers of potential customers. This is especially the case on Aviation Blvd., which is viewed as having a greater potential to cater to pedestrians but will require a higher amount of investment in the built environment. Furthermore, despite representing some of the City’s most popular businesses, business owners in these districts feel there is a disproportionate amount of attention paid to Pier Ave. and the Downtown area.
4 For a full set of streetscape improvement recommendations, see “Hermosa Beach Downtown Economic Development Strategy,” Prepared for the City of Hermosa Beach by ROMA Design Group and Economic & Planning Systems, 12/2013
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Economic & Planning Systems, Inc. 28 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Catalytic projects like new hotels, with or without the continued office development, will increase day population and demand for upscale retail and services. Public support through district parking strategies, reduced parking requirements, and possibly the provision of subsidized parking can help underwrite a desirable range of new development and rehab projects.

Additional changes to the built environment through streetscape improvements can upgrade the “sense of place” and make the City’s commercial districts more desirable destinations for both residents and visitors. Under these improved conditions, retailers will seek to exploit the new market opportunity. And because retailers tend to follow other retailers, successful early movers will quickly be joined.

Certain categories of retail in particular could be a strong fit for a revitalized Downtown, and the PCH and Aviation Corridors. As discussed earlier, women’s apparel is an area of opportunity, along with athletic clothing and sports gear. Home furnishing stores are underrepresented in the city as well. Better restaurants as well as cafes that encourage gathering and lingering would broaden Hermosa Beach’s reputation as an entertainment destination and address residents’ stated desire for more options. Ultimately, once a certain critical mass of change has occurred, anchor retailers could be attracted to become a focal point for the City’s commercial districts. 587
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Vertical
Sq.Ft.(3)
Share Vertical
Sq.Ft.(3)
Share Vertical
Sq.Ft.(3)
Share
Retail and Services
Eating and Drinking(4)
Food/Spirits Extended Hours 51,191 9% 47,773 9% 3,419 1% Food/Spirits Closes at Midnight 27,379 5% 17,236 3% 10,143 2% Food/Beer & Wine 10,084 2% 4,872 1% 5,212 1%
Food/No Alcohol 25,823 5% 19,248 3% 6,575 1%
Subtotal Eating and Drinking 114,478 20% 89,128 16% 25,350 5% Other Retail and Services
Health & Beauty 51,624 9% 23,588 4% 28,035 5%
Sports 22,100 4% 10,797 2% 11,303 2%
Apparel 20,426 4% 12,326 2% 8,100 1%
Souvenirs & Gifts 19,897 4% 1,552 0% 18,345 3%
Bank 11,314 2% 11,314 2% - 0%
Liquor 4,445 1% 2,820 1% 1,625 0%
Market 3,720 1% 2,560 0% 1,160 0%
Wine Shop 2,763 0% - 0% 2,763 0%
Subtotal Other Retail and Services 136,290 24% 64,958 12% 71,332 13% Total Retail and Services 250,767 45% 154,086 27% 96,681 17% Other Commercial
Professional Office 141,938 25% 29,514 5% 112,424 20%
Hotel 90,237 16% 81,269 14% 8,968 2%
Vacant 39,080 7% 29,767 5% 9,313 2%
Residential 36,351 6% 12,963 2% 23,388 4%
Industrial 3,476 1% - 0% 3,476 1%
Subtotal Other Commercial 311,082 55% 153,514 27% 157,568 28% TOTAL 561,849 100% 307,599 55% 254,250 45%
(1) Rectangle formed by the Strand, eastern Hermosa Avenue, 14th Street, and 10th Street (2) Pier Avenue from Hermosa Ave. to Valley Dr.; Strand to Hermosa Ave. between 14th St. and 16th Ct., 10th St. and 8th St. (3) Vertical Sq.Ft. from CoStar and EPS estimates, except as described in footnote (4) (4) Eating and drinking sub-classifications based on City of Hermosa Beach CUPs Sources: The City of Hermosa Beach, CoStar, Economic & Planning Systems Downtown District Core Downtown
District (1)
Non-Core Downtown
District (2)
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Economic & Planning Systems, Inc. 30 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Figure 6 Downtown Hermosa Beach by Land Use
Notes:
(1) Categories designated “Multiple Tenant Retail” include tenants from all eating and drinking categories as well as from the apparel, sports, souvenirs & gifts, health and beauty, and professional office categories (2) Categories designated “Office Over Retail” include professional office as well as uses in health and beauty, apparel, Food/no alcohol, and banking.
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Economic & Planning Systems, Inc. 31 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Table 12 Downtown Hermosa Beach by Ownership Pattern
Table 13 Downtown Hermosa Beach by Acquisition and Construction Activity Land Owner
MP Core 200 930,952 53 23.8%
City of Hermosa Beach 396,260 16 10.1%
Reg8 Plaza Hermosa LLC 246,712 7 6.3%
Melvin and Marie Kausen Trust 108,070 7 2.8%
Resort Sea View Hermosa LLC 96,148 6 2.5%
Daniel and Margaret Gruen Trust 74,379 5 1.9%
Iskandar Family Trust 62,458 5 1.6%
Frederic and Jean Taylor Trust 50,536 3 1.3%
Moise Hendeles Trust 48,074 3 1.2%
S and P Hermosa Parent LLC 33,947 7 0.9%
South Bay 4 LLC 17,028 6 0.4%
Damoder and Sumitri Reddy Trust 13,356 4 0.3%
John and Laura Warren Trust 12,023 3 0.3%
Refoua LLC 9,606 3 0.2%
Celina C Douglas Trust 8,486 3 0.2%
All Other Owners 1,802,463 177 46.1%
Total 3,910,500 308 100%
Sources: City of Hermosa Beach; Los Angeles County Assessor; EPS Square Footage Number of
Parcels Owned
Share
AC Sq.Ft. Share AC Sq.Ft. Share AC Sq.Ft. Share
Recent Construction(3) 0.7 31,229 4% 0.9 40,024 5% 1.6 71,253 9% Acquired After 2010 1.5 63,223 8% 2.5 107,341 13% 3.9 170,563 21% Acquired between 2004 and 2010 2.7 117,792 15% 1.9 84,111 10% 4.6 201,903 25% Acquired between 1993 and 2003 1.7 75,460 9% 1.8 77,511 10% 3.5 152,971 19% Acquired Before 1993 0.9 38,407 5% 0.7 32,359 4% 1.6 70,766 9% City-Owned Land 1.9 82,752 10% 1.1 48,353 6% 3.0 131,105 16% Transaction Data Not Available - - 0% 0.1 5,876 1% 0.1 5,876 1% Total 9.4 408,863 51% 9.1 395,574 49% 18.5 804,438 100% (1) Rectangle formed by the Strand, Hermosa Avenue, 14th Street, and 10th Street Sources: The City of Hermosa Beach; CoStar; Economic & Planning Systems, Inc. (3) "Recent Construction" refers to projects with long remaining usable life; these date from 1998 (Beach House Hotel) to 2013 (205 Pier Ave.)
Category Core Downtown(1) Other Downtown(2) Total Downtown (2) Pier Avenue from Hermosa Ave. to Valley Dr.; the Strand to Hermosa Ave. between 14th St. and 16th Ct. and between 10th St. and 8th St.
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APPENDIX A:

Business Community Input
591
• Business Community Interviewees:
o Jessica Accamando – Hermosa One / Creative Fish
o Marje Bennetts – Beach House Hotel
o Tony Cordi – The Innate Group
o Jason Cortes – The Stanton
o Jon David – Upper Pier Ave. Property Owner
o Lori Ford – Gum Tree
o Ed Hart – Maximus Salon
o Bob Jones – Financial Consultant
o Mike Lacey – Comedy and Magic Club
o Jason Muller – Beach City Capital
o Jon Starr - Starr Design
• Review of Economic Development Stakeholders Advisory Group Notes July 2020 through March 2021
• Feedback received from Economic Development Committee Meeting held March 1, 2021
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APPENDIX B
2014 Report Key Findings
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1. The Hermosa Beach Downtown District is the commercial heart of the City—at once the City’s primary shopping district, gathering area, and visitor attraction.

With approximately 18.5 acres of commercially zoned land on either side of Pier Avenue between the Strand and Valley Boulevard and along Hermosa Avenue between 8th Street and 15th Street, the Hermosa Beach Downtown District hosts a majority of the City’s retail outlets and a large proportion of its hotel and office uses. Pier Plaza, with its large assortment of bars and restaurants, is a popular nightlife destination for visitors from throughout the County. Sales tax revenues from Downtown Hermosa Beach are significant, accounting for 29 percent of all sales tax revenue collected by the City.

2. Hermosa Beach enjoys unique physical qualities that make it a highly desired destination for residents and visitors
Clean air, the broad and sandy beach, and the ocean beyond provide Hermosa Beach with its defining amenity. But unlike Manhattan Beach, Redondo Beach, or most of the other beach cities in Los Angeles County, Hermosa Beach has commercially zoned parcels that directly about the beach at grade. This gives Downtown Hermosa Beach, and Pier Plaza in particular, an intimate relationship with the beachfront that creates potential for highly differentiated hotel and retail offerings. Furthermore, Pier Avenue meets Pier Plaza after a dramatic sweeping quarter-mile descent from Pacific Coast Highway, providing a pleasing pedestrian experience and numerous focal points for commercial activity.

3. The three Beach Cities of Hermosa Beach, Manhattan Beach, and Redondo Beach share geographical proximity and demographic characteristics to function as closely inter-related markets. Consequently, area economic trends, especially those originating from Manhattan Beach, are expected to continue to influence Hermosa Beach.

Each of the three Beach Cities has benefited from the highly desired beach location to become an attractive place to live, work, and play. Compared to the city of Los Angeles, all are affluent, well-educated, and carry high property values—extremely high in the case of Manhattan Beach. Hermosa Beach is differentiated by being the smallest and most casual of the three, with the youngest residents, highest proportion of renters, lowest rate of family formation, and second-highest level of income. However, due to rapidly appreciating land costs in Manhattan Beach, Hermosa Beach has begun to absorb spill-over residential demand, which land use professionals believe will narrow the wealth gap with Manhattan Beach, reflect in increased home ownership levels, and lead to increased family representation.

4. Despite its location and demographic advantages, the Downtown Core has not fulfilled its potential as a commercial district for residents and visitors, according to area land use professionals.

Pier Plaza’s bars and restaurants host a boisterous nightlife scene that has increasingly generated conflict with neighborhood residents. According to local brokers and real estate professionals, the current Pier Plaza tenant mix has tended to discourage a broader range of retail and commercial activities. In turn, the lack of diversity in dining and shopping options has helped perpetuate the dominance of current uses. However, the decisive loss of the 594
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Economic & Planning Systems, Inc. A-2 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx proposed Measure B “Quiet Nights” ballot initiative implies that residents do not believe a mandated reduction in late-night operating hours is necessarily the best way to manage the issue. Other long-term impediments to the realization of Downtown Core potential include legacy property ownership, which has resulted in inconsistent property management and tenanting; restrictive requirements for the provision of new parking, which have encumbered new development; and a small day-time population (excluding summer weekend beachgoers), which limits potential day-time retail demand.

5. Land ownership and usage patterns in the Hermosa Beach Downtown District have undergone a significant amount of organic, market-driven transition in recent years providing momentum for further public and private investment.

For many years, land ownership in Downtown Hermosa Beach was dominated by long-term custodial land owners, which led to a generally slow pace of change. However, since 2010, 24 percent of the Downtown District land has changed hands, 18,000 square feet of new construction has occurred, and hotels proposing over 130 new rooms are in planning or under development. This activity is attributable to several driving factors: the end of the recession; the continued in-migration of wealthy residents to Hermosa Beach and the Beach Cities in general; growth in the number of high-paying jobs in Hermosa Beach and the Beach Cities; and public investment in streetscape improvements on Upper Pier Avenue. This primarily market-driven momentum for change provides a strong basis for successful revitalization strategies.

6. New hotel development in Downtown Hermosa Beach, in particular the proposed hotel for the former Mermaid site, represents the biggest opportunity for near-term transformation of Pier Plaza.

The proposed Mermaid site hotel represents a rare opportunity to catalyze change in Pier Plaza, combining strong market factors with a strategic location. The site is one of the best commercial locations on the entire Strand between Redondo Beach and Manhattan Beach, due to its frontage on both Pier Plaza and the Strand. The assembly of land, acquired in 2013 at very high cost, reflects confidence in the market to support luxury hotel rates. Because the site dominates the northwestern corner of Pier Plaza, new construction will strongly influence its look and feel going forward. With very few alternatives of upscale or luxury beachfront hotels in Los Angeles County, the proposed Mermaid site hotel could become—like Shutters and Casa del Mar in Santa Monica and Terranea in Palos Verdes—a landmark destination drawing visitors from all over the country. Inclusion of ground floor public space, such as a lobby bar, could provide an amenity for locals and day visitors as well as guests, providing an upscale alternative to current Pier Plaza bars and restaurants. This, in turn, could influence tenanting decisions by Pier Plaza land owners and lead to a diversification of current uses.

Finally, the economic impacts from spending by affluent guests and the fiscal impacts from new Transient Occupancy Tax (TOT) and sales tax could be very significant. City support for a top-quality hotel on the site presents a high-leverage opportunity to effect positive change. 595
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7. Retail revitalization and diversification in the Hermosa Beach Downtown District will likely occur gradually as a result of improvements in several underlying conditions.

Despite its high population density and affluence, Downtown Hermosa Beach has not fulfilled its potential due to factors discussed above. Consequently, the quality and diversity of many existing retail establishments is not on par with expectations of residents or potential visitors from other Beach Cities. For example, the current retail tenant mix along Pier Avenue and Hermosa Avenue appears to be over-represented in the health and beauty sector (uses more typical of a neighborhood center than a retail shopping district), and under-represented in the apparel sector, where the City exhibits significant retail leakage. Actions that increase the day-time population or create interest in the Downtown District as a day-time destination can create positive conditions that induce retail development over time. These actions may include hotel and office development, which increases the day-time population; streetscape improvements to create a better and more attractive sense of place; and public parking improvements that reduce impediments to visitation and offset the costs of new development.

8. Development of office space catering to knowledge-work sectors such as finance, real estate, and professional services, represents a meaningful opportunity for Downtown District economic development.

The office market in the City of Hermosa Beach is not as large as that in Manhattan Beach and Redondo Beach, but in the Downtown District, high rents, low vacancies, and a growing cluster of knowledge workers suggests market support for new office space there. Since 2000, over 60 percent of new office growth in the city has occurred in the Downtown District, specifically at 200 Pier Avenue, 205 Pier Avenue, 338 Pier Avenue, and 400 Pier Avenue, buildings that cater to tenants in knowledge work fields such as finance, real estate, and information. This reflects a larger trend in which knowledge workers, who can work anywhere with a network connection, are choosing workplaces closer to home in areas offering a high quality of life. Area brokers believe this trend represents a strong and continuing opportunity for the Beach Cities. One positive consequence of new Downtown office growth is increased day-time population, which generates additional demand for retail and services.

9. Provision of public shared centralized parking may help encourage catalytic projects in the Downtown Core
The compact and walkable nature of Downtown Hermosa Beach lends itself to a district parking strategy that encourages visitors to park centrally and circulate on foot.

Consequently, provision of centralized public and public-private parking solutions could increase pedestrian traffic and enhance retail vitality. In addition, the option for developers to provide some required parking through in-lieu fees, as is already offered by the City, can help some physically constrained sites become more viable for new development. However, the current in-lieu fee, which is roughly equivalent to the per-stall development cost in a parking structure, is considered restrictive by many local land use professionals, especially given high current parking requirements mandated by city code for commercial uses, in particular restaurants. The City can ease the burden on developers by lowering in-lieu fees 596
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Economic & Planning Systems, Inc. A-4 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx and by lowering parking requirements outright.5 There is strong potential for the City to offset the associated loss of revenue with increases in sales tax, business license tax, TOT, and other taxes associated with new commercial activity.

10.Public investment in streetscape improvement is a strong tool for the City to encourage catalytic projects.

Streetscape improvements on Hermosa Avenue and Pier Plaza could help the area more fully realize the potential of its natural physical advantages to become a more attractive destination for day-time visitors, families, and tourists. Such improvements could enhance the sense of arrival, calm traffic, upgrade the pedestrian experience, facilitate bicycle transport, and refresh and update the image of the area. This could help create a “virtuous circle” that attracts more visitors, who increase the market potential for new tenants, who in turn draw more visitors. For example, focused improvements on the eastern side of Hermosa Avenue that encourage a more vibrant street life can help bring out the redevelopment potential represented by relatively large parcels and floorplates, frontage that defines (and extends) the edge of the Pier Plaza activity, and traffic counts consistent with the location at the nexus of the Downtown District. Furthermore, such improvements can help improve circulation between Upper Pier Avenue and Pier Plaza and facilitate a stronger commercial flow between the two areas.6
5 For a full set of parking strategy recommendations, see “Hermosa Beach Downtown Economic Development Strategy,” Prepared for the City of Hermosa Beach by ROMA Design Group and Economic & Planning Systems, 12/2013
6 For a full set of streetscape improvement recommendations, see “Hermosa Beach Downtown Economic Development Strategy,” Prepared for the City of Hermosa Beach by ROMA Design Group and Economic & Planning Systems, 12/2013
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APPENDIX C
Supporting Data
598
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Economic & Planning Systems, Inc. A-2 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Appendix 1 Hermosa Beach Fiscal Revenues, FY10-11 to FY19-20 0 5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
40,000,000
45,000,000
FY10-11 FY11-12 FY12-13 FY13-14 FY14-15 FY15-16 FY16-17 FY17-18 FY18-19 FY19-20 Property Tax Sales and Use Tax Transient Occupancy Tax
Business License Tax Utility Users Tax Other Taxes
Licenses and Permits Fines and Forfeitures Use of Property and Money Intergovernmental/State Service Charges Other Revenue
599
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Economic & Planning Systems, Inc. A-3 Z:\Shared\Projects\LA\204000s\204026_Hermosa Beach Economic and Market Analysis\Report\EPS Updated Economic and Market Study_City Edits.docx Appendix 2 Hermosa Beach Fiscal Revenues, FY19-20 Detail Revenue Source Category FY19-20 Share
Property Tax $19,045,242 44.6%
Sales and Use Tax $3,146,342 7.4%
Transient Occupancy Tax $3,505,250 8.2%
Business License Tax $1,184,426 2.8%
Utility Users Tax $2,147,057 5.0%
Other Taxes $1,252,169 2.9%
Licenses and Permits $1,213,724 2.8%
Fines and Forfeitures $2,365,086 5.5%
Use of Property and Money $1,006,122 2.4%
Intergovernmental/State $127,256 0.3%
Service Charges $7,523,765 17.6%
Other Revenue $165,416 0.4%
Total $42,681,855 100.0%
Sources: City of Hermosa Beach; EPS
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City of Hermosa Beach
Staff Report
City Hall
1315 Valley Drive
Hermosa Beach, CA 90254
Staff Report
REPORT 22-0358
Honorable Mayor and Members of the Hermosa Beach City Council Regular Meeting of June 14, 2022

CALLING AND GIVING NOTICE AND CERTAIN OTHER

RESOLUTIONS NECESSARY FOR HOLDING

THE GENERAL MUNICIPAL ELECTION
TO BE HELD ON TUESDAY, NOVEMBER 8, 2022
(City Clerk Myra Maravilla)
Recommended Action:

Staff recommends Council:

1. Adopt Resolution calling and giving notice of the election for certain officers and one or more measures (Attachment 1);

2. Adopt Resolution to permit a special runoff election for elective officers in the event of a tie vote (Attachment 2);

3. Adopt Resolution to request the County of Los Angeles consolidate the City of Hermosa Beach General Municipal Election with the Statewide General Election and render full services to the conduct of the election (Attachment 3); and

4. Adopt Resolution to adopt regulations for candidates for election office pertaining to candidate statements (Attachment 4).

Executive Summary:

On Tuesday, November 8, 2022, the City will conduct a General Municipal Election consolidated with the Statewide General Election for the election of three members of the City Council, each to a term of four years ending in November 2026, and at least one ballot measure. Staff recommends City Council adopt the resolutions as outlined in staff’s recommendations (Attachments 1, 2, 3 and 4).

Background:

The election resolutions presented for adoption are standard actions required of the City Council per the California Elections Code and other provisions of State of California laws to hold the General Municipal Election on November 8, 2022.

The initiative petition filed by Colton Chacker to repeal the ban on cannabis in the City of Hermosa Beach will be on the ballot with the possibility of additional measure(s) submitted by the City Council.

All election resolutions containing ballot measure information, including priorities for submitting arguments and rebuttal arguments, will be presented to the City Council on or before the deadlines City of Hermosa Beach Page 1 of 4 Printed on 6/9/2022
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set forth by Los Angeles County for the printing of the Sample Ballot Booklet.

Discussion:

On November 8, 2022, the City of Hermosa Beach will conduct a General Municipal Election, conducted by the County of Los Angeles, for the election of three City Councilmembers, for full fouryear terms ending November 2026 (Attachment 3) and at least one ballot measure. The Election Information page is located on the City’s website and is regularly updated with key dates and information for members of the public to review.

The City Clerk would advertise the calling of the election (Attachment 1) through various outlets including a publication in a local newspaper, a GovDelivery notification, and the City’s social media outlets. The Candidate Workshop is tentatively scheduled to take place on the first day of the nomination period, July 18, 2022, at 10 a.m. in the Council Chambers located at City Hall.

Prospective candidates and the media are encouraged to attend and ask questions about the election process. Nomination papers will be issued to prospective candidates at the conclusion of the Candidate Workshop. Prospective candidates unable to attend the Candidate Workshop are encouraged to schedule an appointment with the City Clerk’s office during business hours, Monday through Thursday between 7 a.m. and 6 p.m.

Should there be a tie vote between two or more of the top three candidates, a special runoff election would take place (Attachment 2).

California Elections Code Section 13307 allows candidates for a nonpartisan city elective office to prepare a statement to be included with the Sample Ballot Booklet and mailed to each registered voter. State law requires that the City Council adopt a policy regarding the candidates’ obligation for payment for candidate statements and other related matters. State law permits the Council to authorize an increase of the word limitation for the statement from 200 to 400 words. Past policy has restricted the statements to 200 words as reflected in the Resolution (Attachment 4). Staff recommends City Council adopt the same word limitation, 200 words. Staff’s experience is that this word limit has been sufficient for candidates in past elections.

Additionally, the Resolution (Attachment 4) includes information about the translation of election materials. All voters who register to vote and select to receive election materials in a language other than English will automatically receive their election materials in that language.

Resolutions for Adoption:

1. RESOLUTION NO. 22- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

HERMOSA BEACH, CALIFORNIA, CALLING FOR THE HOLDING OF A GENERAL MUNICIPAL ELECTION TO BE HELD ON TUESDAY, NOVEMBER 8, 2022, FOR THE ELECTION OF

CERTAIN OFFICERS AND ONE OR MORE MEASURES TO THE VOTE OF THE PEOPLE AS

REQUIRED BY THE PROVISIONS OF THE LAWS OF THE STATE OF CALIFORNIA

RELATING TO GENERAL LAW CITIES

2. RESOLTUION NO. 22- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF City of Hermosa Beach Page 2 of 4 Printed on 6/9/2022
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2. RESOLTUION NO. 22- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

HERMOSA BEACH, CALIFORNIA, PROVIDING FOR THE CONDUCT OF A SPECIAL RUNOFF

ELECTION FOR ELECTIVE OFFICES IN THE EVENT OF A TIE VOTE AT THE GENERAL MUNICIPAL ELECTION TO BE HELD NOVEMBER 8, 2022

3. RESOLUTION NO. 22- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

HERMOSA BEACH, CALIFORNIA, REQUESTING THE BOARD OF SUPERVISORS OF THE

COUNTY OF LOS ANGELES TO CONSOLIDATE THE GENERAL MUNICIPAL ELECTION TO BE HELD IN THE COUNTY OF LOS ANGELES THE SAME DAY; TO AUTHORIZE THE BOARD

OF SUPERVISORS OF THE COUNTY OF LOS ANGELES TO CANVASS THE RETURNS OF SAID GENERAL MUNICIPAL ELECTION; AND TO REQUEST THAT THE REGISTRARRECORDER/COUNTY CLERK OF SAID COUNTY BE PERMITTED TO RENDER FULL

SERVICES TO THE CITY OF HERMOSA BEACH RELATING TO THE CONDUCT OF SAID

GENERAL MUNICIPAL ELECTION PURSUANT TO CALIFORNIA ELECTIONS CODE SECTION 10403

4. RESOLUTION NO. 22- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

HERMOSA BEACH, CALIFORNIA, ADOPTING REGULATIONS FOR CANDIDATES FOR

ELECTIVE OFFICE PERTAINING TO CANDIDATE STATEMENTS TO BE SUBMITTED TO THE VOTERS AT AN ELECTION TO BE HELD ON TUESDAY, NOVEMBER 8, 2022 General Plan Consistency:

This report and associated recommendation have been evaluated for their consistency with the City’s General Plan. Relevant Policies are listed below:

Governance Element
Goal 1. A high degree of transparency and integrity in the decision-making process.

Policies:
· 1.1 Open meetings. Maintain the community’s trust by holding meetings in which decisions are being made, that are open and available for all community members to attend, participate, or view remotely.
· 2.1 Multiple outreach methods. Consistently engage in community outreach that promote public participation and ensure Hermosa Beach events are communicated to all segments of the communities.

Goal 2. The community is active and engaged in decision-making processes.

Policy:
· 2.6 Responsive to community needs. Continue to be responsive to community inquiries, providing public information and recording feedback from community interactions.

Fiscal Impact:

Included in the 2022-23 Preliminary Budget is $110,000 to cover the cost of the November 8, 2022, City of Hermosa Beach Page 3 of 4 Printed on 6/9/2022
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REPORT 22-0358
General Municipal Election. An estimated cost of the election was generated using the election calculator provided by the Los Angeles County Registrar-Recorder/County Clerk.

Attachments:

1. Draft Resolution Calling and Giving Notice of the Election

2. Draft Resolution in the Event of a Tie Vote

3. Draft Resolution to Consolidate Election with Los Angeles County

4. Draft Resolution to Adopt Regulations for Candidate Statements

5. Election Calendar
Respectfully Submitted by: Myra Maravilla, City Clerk
Noted for Fiscal Impact: Viki Copeland, Finance Director Legal Review: Mike Jenkins, City Attorney
Approved: Suja Lowenthal, City Manager
City of Hermosa Beach Page 4 of 4 Printed on 6/9/2022
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